[House Report 104-280]
[From the U.S. Government Publishing Office]



   104th Congress 1st 
         Session        HOUSE OF REPRESENTATIVES        Report
                                                       104-280
_______________________________________________________________________

                                     


         SEVEN-YEAR BALANCED BUDGET RECONCILIATION ACT OF 1995

                               ----------                              

                              R E P O R T

                                 of the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                              to accompany

                               H.R. 2491

  A BILL TO PROVIDE FOR RECONCILIATION PURSUANT TO SECTION 105 OF THE 
        CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 1996

                             together with

               MINORITY, ADDITIONAL, AND DISSENTING VIEWS

                                     



                                Volume I
                              Titles I-XII

October 17, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
SEVEN -YEAR BALANCED BUDGET RECONCILIATION ACT OF 1995 --VOLUME I
   104th Congress 1st   HOUSE OF REPRESENTATIVES        Report
         Session
                                                       104-280
_______________________________________________________________________


 
  SEVEN-YEAR BALANCED BUDGET RECONCILIATION ACT OF 1995  --  VOLUME I

                               __________

                              R E P O R T

                                 of the

                        COMMITTEE ON THE BUDGET
                        HOUSE OF REPRESENTATIVES

                              to accompany


                                H.R. 2491

  A BILL TO PROVIDE FOR RECONCILIATION PURSUANT TO SECTION 105 OF THE 
        CONCURRENT RESOLUTION ON THE BUDGET FOR FISCAL YEAR 1996



                             together with



               MINORITY, ADDITIONAL, AND DISSENTING VIEWS






                                Volume I



                              Titles I-XII

October 17, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed
                        COMMITTEE ON THE BUDGET

  JOHN R. KASICH, Ohio, Chairman
MARTIN OLAV SABO, Minnesota,         DAVID L. HOBSON, Ohio
  Ranking Minority Member            ROBERT S. WALKER, Pennsylvania,
CHARLES W. STENHOLM, Texas             Vice Chairman
LOUISE McINTOSH SLAUGHTER,           JIM KOLBE, Arizona
  New York                           CHRISTOPHER SHAYS, Connecticut
MIKE PARKER, Mississippi             WALLY HERGER, California
WILLIAM J. COYNE, Pennsylvania       JIM BUNNING, Kentucky
ALAN B. MOLLOHAN, West Virginia      LAMAR S. SMITH, Texas
JERRY F. COSTELLO, Illinois          WAYNE ALLARD, Colorado
HARRY JOHNSTON, Florida              DAN MILLER, Florida
PATSY T. MINK, Hawaii                RICK LAZIO, New York
BILL ORTON, Utah                     BOB FRANKS, New Jersey
EARL POMEROY, North Dakota           NICK SMITH, Michigan
GLEN BROWDER, Alabama                BOB INGLIS, South Carolina
LYNN C. WOOLSEY, California          MARTIN R. HOKE, Ohio
JOHN W. OLVER, Massachusetts         SUSAN MOLINARI, New York
LUCILLE ROYBAL-ALLARD, California    JIM NUSSLE, Iowa
CARRIE P. MEEK, Florida              PETER HOEKSTRA, Michigan
LYNN N. RIVERS, Michigan             STEVE LARGENT, Oklahoma
LLOYD DOGGETT, Texas                 SUE MYRICK, North Carolina
                                     SAM BROWNBACK, Kansas
                                     JOHN SHADEGG, Arizona
                                     GEORGE P. RADANOVICH, California
                                     CHARLES F. BASS, New Hampshire

                           Professional Staff

  Richard E. May, Staff Director
 Eileen M. Baumgartner, Minority 
          Staff Director


                   V O L U M E   I   C O N T E N T S

                              ----------                              

                          Legislative Language

                                                                   Page
Title I--Provisions of General Applicability.....................     2
Title II--Committee on Banking and Financial Services............     2
Title III--Committee on Commerce.................................    28
Title IV--Committee on Economic and Educational Opportunities....    47
Title V--Committee on Government Reform and Oversight............    56
Title VI--Committee on International Relations...................    56
Title VII--Committee on the Judiciary............................    57
Title VIII--Committee on National Security.......................    58
Title IX--Committee on Resources.................................    61
Title X--Committee on Transportation and Infrastructure..........   127
Title XI--Committee on Veterans' Affairs.........................   164
Title XII--Committee on Ways and Means--Trade....................   171

                            Report Language

Introduction.....................................................   185
Title II--Committee on Banking and Financial Services............   191
Title III--Committee on Commerce.................................   221
Title IV--Committee on Economic and Educational Opportunities....   335
Title VI--Committee on International Relations...................   419
Title VII--Committee on the Judiciary............................   527
Title VIII--Committee on National Security.......................   535
Title IX--Committee on Resources.................................   553
Title X--Committee on Transportation and Infrastructure..........   727
Title XI--Committee on Veterans' Affairs.........................   877
Title XII--Committee on Ways and Means--Trade....................   929
                                                                       
104th Congress                                            Rept. 104-280
                        HOUSE OF REPRESENTATIVES

 1st Session                                                   Volume I
_______________________________________________________________________



PROVIDING FOR RECONCILIATION PURSUANT TO SECTION 105 OF THE CONCURRENT 
             RESOLUTION ON THE BUDGET FOR FISCAL YEAR 1996

_______________________________________________________________________


October 17, 1995.--Committed to the Committee of the Whole House on the 
              State of the Union and ordered to be printed

                                _______


             Mr. Kasich, from the Committee on the Budget,

                        submitted the following

                              R E P O R T

                             together with

               MINORITY, ADDITIONAL, AND DISSENTING VIEWS

                        [To accompany H.R. 2491]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on the Budget, to whom reconciliation 
recommendations were submitted pursuant to section 105 of House 
Concurrent Resolution 67, the concurrent resolution on the 
budget for fiscal year 1996, having considered the same, report 
the bill without recommendation.

              TITLE I--PROVISIONS OF GENERAL APPLICABILITY

SECTION 1001. SHORT TITLE.

    This Act may be cited as the ``Seven-Year Balanced Budget 
Reconciliation Act of 1995''.

SEC. 1002. TABLE OF TITLES.

    This Act is organized into titles as follows:

Title I--Provisions of General Applicability
Title II--Committee on Banking and Financial Services
Title III--Committee on Commerce
Title IV--Committee on Economic and Educational Opportunities
Title V--Committee on Government Reform and Oversight
Title VI--Committee on International Relations
Title VII--Committee on the Judiciary
Title VIII--Committee on National Security
Title IX--Committee on Resources
Title X--Committee on Transportation and Infrastructure
Title XI--Committee on Veterans' Affairs
Title XII--Committee on Ways and Means-Trade
Title XIII--Committee on Ways and Means-Revenues
Title XIV--Committee on Ways and Means-Tax Simplification
Title XV--Medicare
Title XVI--Transformation of the Medicaid Program
Title XVII--Reorganization of the Department of Commerce
Title XVIII--Welfare Reform
Title XIX--Contract Tax Provisions
Title XX--Budget Process

         TITLE II--COMMITTEE ON BANKING AND FINANCIAL SERVICES

SEC. 2001. TABLE OF CONTENTS.

    The table of contents for this title is as follows:

                     Subtitle A--Housing Provisions

Sec. 2101. Termination of RTC and FDIC affordable housing programs.
Sec. 2102. Elimination of FHA assignment program and foreclosure 
relief.
Sec. 2103. Reform of HUD-owned multifamily property disposition 
program.
Sec. 2104. Recapture of rural housing loan subsidies by Rural Housing 
and Community Development Service.
Sec. 2105. Reduction of section 8 annual adjustment factors for units 
without tenant turnover.

                 Subtitle B--Thrift Charter Conversion

Sec. 2200. Short title.

 Chapter 1--Bank Insurance Fund and Savings Association Insurance Fund

Sec. 2201. Special assessment.
Sec. 2202. Assessments on insured depository institutions.
Sec. 2203. Merger of Bank Insurance Fund and Savings Association 
Insurance Fund after recapitalization of SAIF.
Sec. 2204. Refund of amounts in deposit insurance fund in excess of 
designated reserve amount.
Sec. 2205. Assessments authorized only if needed to maintain the 
reserve ratio of a deposit insurance fund.

          Chapter 2--Status Of Banks and Savings Associations

Sec. 2221. Termination of Federal savings associations; treatment of 
State savings associations as banks for purposes of Federal banking 
law.
Sec. 2222. Treatment of certain activities and affiliations of bank 
holding companies resulting from this Act.
Sec. 2223. Transition provisions for activities of savings associations 
which convert into or become treated as banks.
Sec. 2224. Registration of bank holding companies resulting from 
conversions of savings associations to banks or treatment of savings 
associations as banks.
Sec. 2225. Additional transition provisions and special rules.
Sec. 2226. Technical and conforming amendments.
Sec. 2227. References to savings associations and State banks in 
Federal law.
Sec. 2228. Repeal of Home Owners' Loan Act.
Sec. 2229. Effective date; definitions.

       Chapter 3--Transfer Of Functions, Personnel, and Property

Sec. 2241. Office of Thrift Supervision abolished.
Sec. 2242. Determination of transferred functions and employees.
Sec. 2243. Savings provisions.
Sec. 2244. References in Federal law to Director of the Office of 
Thrift Supervision.
Sec. 2245. Reconfiguration of board of directors of FDIC as a result of 
removal of Director of the Office of Thrift Supervision.

                 Chapter 4--Loan Loss Reserve Treatment

Sec. 2261. Sense of the Congress.

           Subtitle C--Community Reinvestment Act Amendments

Sec. 2301. Expression of congressional intent.
Sec. 2302. Community Reinvestment Act exemption.
Sec. 2303. Self-certification of CRA compliance.
Sec. 2304. Community input and conclusive rating.
Sec. 2305. Special purpose financial institutions.
Sec. 2306. Increased incentives for lending to low- and moderate-income 
communities.
Sec. 2307. Prohibition on additional reporting under CRA.
Sec. 2308. Technical amendment.
Sec. 2309. Duplicative reporting.
Sec. 2310. CRA congressional oversight.
Sec. 2311. Consultation among examiners.
Sec. 2312. Limitation on regulations.

                     Subtitle A--Housing Provisions

SEC. 2101. TERMINATION OF RTC AND FDIC AFFORDABLE HOUSING PROGRAMS.

    (a) Repeal of Unified Program and Transfer of RTC Windup Authority 
to HUD.--Section 21A(c) of the Federal Home Loan Bank Act (12 U.S.C. 
1441a(c)) is amended by striking paragraph (17) and inserting the 
following new paragraph:
            ``(17) Transfer of authority.--The Secretary shall assume, 
        not later than December 31, 1995, and thereafter shall carry 
        out, any remaining authority and responsibilities of the 
        Corporation to recapture excess proceeds from resale of 
        properties and to monitor and enforce low-income occupancy 
        requirements or rent limitations under this subsection and 
        shall assume any direct or contingent liability of the 
        Corporation to carry out such authority and 
        responsibilities.''.
    (b) Termination of RTC Affordable Housing Program.--Section 21A(c) 
of the Federal Home Loan Bank Act (12 U.S.C. 1441a(c)) is amended by 
adding at the end the following new paragraph:
            ``(18) Termination.--
                    ``(A) In General.--On and after the date of the 
                enactment of the Seven-Year Balanced Budget 
                Reconciliation Act of 1995, the provisions of this 
                subsection (other than paragraph (17)) shall not apply 
                with respect to any eligible residential property or 
                eligible condominium property.
                    ``(B) Savings provision.--Notwithstanding 
                subparagraph (A), the provisions of this subsection 
                shall continue to apply on and after such date of 
                enactment to any eligible residential property or 
                eligible condominium property that--
                            ``(i) has been sold or otherwise disposed 
                        of by the Corporation before such date of 
                        enactment; or
                            ``(ii) is subject to a contract of sale or 
                        other disposition entered into before such date 
                        of enactment.''.
    (c) Termination of Affordable Housing Advisory Board.--Section 
14(b)(9) of the Resolution Trust Corporation Completion Act (12 U.S.C. 
1831q note) is amended by striking ``September 30, 1998'' and inserting 
``September 30, 1995''.
    (d) Repeal of FDIC Program and Transfer of Windup Authority to 
HUD.--
            (1) Repeal.--Section 40 of the Federal Deposit Insurance 
        Act (12 U.S.C. 1831q) is hereby repealed.
            (2) Transfer of windup authority.--Notwithstanding 
        paragraph (1)--
                    (A) effective December 31, 1995, the Secretary 
                shall carry out any remaining authority and 
                responsibilities of the Federal Deposit Insurance 
                Corporation under section 40 of the Federal Deposit 
                Insurance Act to recapture excess proceeds from resale 
                of properties and to monitor and enforce low-income 
                occupancy requirements or rent limitations under such 
                section and shall assume any direct or contingent 
                liability of the Corporation to carry out such 
                authority and responsibilities; and
                    (B) the Federal Deposit Insurance Corporation shall 
                consummate any sales of property under section 40 of 
                such Act that were pending under contracts of sale on 
                September 30, 1995.
    (e) FDIC Disposition of Assets as Conservator or Receiver.--Section 
11(d)(13)(E) of the Federal Deposit Insurance Act (12 U.S.C. 
1821(d)(13)(E)) is amended--
            (1) in clause (iii), by inserting ``and'' after the 
        semicolon;
            (2) in clause (iv), by striking ``; and'' and inserting a 
        period; and
            (3) by striking clause (v).
    (f) Disposition of FDIC Assets.--Section 13(d)(3)(D) of the Federal 
Deposit Insurance Act (12 U.S.C. 1823(d)(3)(D)) is amended--
            (1) in clause (iii), by inserting ``and'' after the 
        semicolon;
            (2) in clause (iv), by striking ``; and'' and inserting a 
        period; and
            (3) by striking clause (v).

SEC. 2102. ELIMINATION OF FHA ASSIGNMENT PROGRAM AND FORECLOSURE 
                    RELIEF.

    (a) Elimination of TMAP and Assignment Program.--Section 230 of the 
National Housing Act (12 U.S.C. 1715u) is hereby repealed.
    (b) Prohibition of Foreclosure Avoidance Relief.--Section 204 of 
the National Housing Act (12 U.S.C. 1710) is amended by adding at the 
end the following new subsection:
    ``(m) Prohibition of Foreclosure Avoidance Relief.--Notwithstanding 
any provision of this section, any other provision of this Act, section 
2 of the Housing Act of 1949, section 2 of the Housing and Urban 
Development Act of 1968, or any other provision of law, after September 
30, 1995, the Secretary of Housing and Urban Development may not 
provide foreclosure avoidance relief to any mortgagor who has defaulted 
in making payments under a mortgage covering a 1-, 2-, 3-, or 4-family 
residence insured under this Act.''.

SEC. 2103. REFORM OF HUD-OWNED MULTIFAMILY PROPERTY DISPOSITION 
                    PROGRAM.

    (a) In General.--Effective October 1, 1995, section 203 of the 
Housing and Community Development Amendments of 1978 (12 U.S.C. 1701z-
11) is amended to read as follows:

``SEC. 203. MANAGEMENT AND DISPOSITION OF HUD-OWNED MULTIFAMILY HOUSING 
                    PROJECTS.

    ``(a) In General.--The Secretary of Housing and Urban Development 
may manage and dispose of (1) multifamily housing projects that are 
owned by the Secretary or that are subject to mortgages held by the 
Secretary, and (2) mortgages on multifamily housing projects that are 
held by the Secretary, without regard to any other provision of law.
    ``(b) Authority to Delegate.--The Secretary of Housing and Urban 
Development may delegate to one or more entities the authority to carry 
out some or all of the functions and responsibilities of the Secretary 
in connection with the foreclosure of mortgages on multifamily housing 
projects held by the Secretary.
    ``(c) Definition.--For purposes of this section, the term 
`multifamily housing project' means any multifamily rental housing 
project which is, or prior to acquisition by the Secretary was, 
assisted or insured under the National Housing Act, or was subject to a 
loan under section 202 of the Housing Act of 1959.''.
    (b) Conforming Amendments.--
            (1) Nondiscrimination against certificate and voucher 
        holders.--Section 183(c) of the Housing and Community 
        Development Act of 1987 (42 U.S.C. 1437f note) is amended by 
        striking ``section 203(i)(2) of the Housing and Community 
        Development Amendments of 1978, as amended by section 181(h) of 
        this Act'' and inserting ``section 203(b) of the Housing and 
        Community Development Amendments of 1978 (as in effect before 
        October 1, 1995)''.
            (2) LIHPRH act of 1990.--Section 212(c) of the Low-Income 
        Housing Preservation and Resident Homeownership Act of 1990 (12 
        U.S.C. 4102(c)) is amended by striking the last sentence.
            (3) Hope homeownership program.--Section 427 of the 
        Cranston-Gonzalez National Affordable Housing Act (42 U.S.C. 
        12877) is amended by striking ``subject to--'' and all that 
        follows and inserting ``subject to the Low-Income Housing 
        Preservation and Resident Homeownership Act of 1990.''.
            (4) FHA multifamily housing mortgage insurance.--Section 
        207(k) of the National Housing Act (12 U.S.C. 1713(k)) is 
        amended by striking the third sentence.
            (5) Multifamily mortgage foreclosure act of 1981.--Section 
        367(b)(2) of the Multifamily Mortgage Foreclosure Act of 1981 
        (12 U.S.C.3706(b)(2)) is amended--
                    (A) by striking subparagraph (B); and
                    (B) by striking ``(A)''.
            (6) Preventing mortgage defaults on insured multifamily 
        projects.--Section 103(h)(2)(B) of the Multifamily Housing 
        Property Disposition Reform Act of 1994 (12 U.S.C. 1715z-1a 
        note) is amended by inserting ``(as in effect before October 1, 
        1995)'' after ``1978''.

SEC. 2104. RECAPTURE OF RURAL HOUSING LOAN SUBSIDIES BY RURAL HOUSING 
                    AND COMMUNITY DEVELOPMENT SERVICE.

    The first sentence of section 521(a)(1)(D)(i) of the Housing Act of 
1949 (42 U.S.C. 1490a(a)(1)(D)(i)) is amended by inserting ``upon the 
repayment of any loan made under this title or'' after ``assistance 
rendered''.

SEC. 2105. REDUCTION OF SECTION 8 ANNUAL ADJUSTMENT FACTORS FOR UNITS 
                    WITHOUT TENANT TURNOVER.

    Paragraph (2)(A) of section 8(c) of the United States Housing Act 
of 1937 (42 U.S.C. 1437f(c)(2)(A)) is amended by striking the last 
sentence.

                 Subtitle B--Thrift Charter Conversion

SEC. 2200. SHORT TITLE.

    This subtitle may be cited as the ``Thrift Charter Conversion Act 
of 1995''.

 CHAPTER 1--BANK INSURANCE FUND AND SAVINGS ASSOCIATION INSURANCE FUND

SEC. 2201. SPECIAL ASSESSMENT.

    Section 7(b)(6) of the Federal Deposit Insurance Act (12 U.S.C. 
1817(b)(6)) is amended--
            (1) by redesignating clauses (i), (ii), and (iii) of 
        subparagraph (A) as subclauses (I), (II), and (III), 
        respectively;
            (2) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), respectively;
            (3) by moving the left margin of such clauses and 
        subclauses (as so redesignated) 2 ems to the right;
            (4) by striking ``special assessments.--In addition to'' 
        and inserting ``special assessments.--
                    ``(A) In general.--In addition to''; and
            (5) by adding at the end the following new subparagraphs:
                    ``(B) Single additional special assessment with 
                respect to certain accounts.--
                            ``(i) In general.--The Corporation shall 
                        impose, on the basis of such factors as the 
                        Board of Directors considers to be appropriate, 
                        a single special assessment on the institutions 
                        described in the following subclauses (other 
                        than institutions exempt under subparagraph 
                        (C)):
                                    ``(I) Each Savings Association 
                                Insurance Fund member (including any 
                                Savings Association Insurance Fund 
                                member referred to in section 
                                5(d)(2)(G)).
                                    ``(II) Each Bank Insurance Fund 
                                member which has deposits which are 
                                treated, under section 5(d)(3), as 
                                deposits which are insured by the 
                                Savings Association Insurance Fund.
                            ``(ii) Amount of assessment.--The 
                        assessment imposed under clause (i) shall be in 
                        an amount equal to such percentage of the 
                        Savings Association Insurance Fund assessment 
                        base (of the institutions subject to such 
                        assessment) as of March 31, 1995, as the Board 
                        of Directors determines, in the Board of 
                        Directors' discretion, to be necessary in order 
                        for the reserve ratio of the Savings 
                        Association Insurance Fund to meet the 
                        designated reserve ratio on the 1st business 
                        day of January, 1996.
                            ``(iii) Deposit of assessment.--
                        Notwithstanding any other provision of law, the 
                        proceeds of any assessment imposed under clause 
                        (i) shall be deposited in the Savings 
                        Association Insurance Fund.
                            ``(iv) Date payment due.--The special 
                        assessment imposed under this subparagraph 
                        shall be--
                                    ``(I) due on the 1st business day 
                                of January, 1996; and
                                    ``(II) paid to the Corporation on 
                                the later of the due date or such other 
                                date as the Corporation may prescribe 
                                which may not be later than the end of 
                                the 60-day period beginning on the date 
                                of the Thrift Charter Conversion Act of 
                                1995.
                            ``(v) Savings association insurance fund 
                        assessment base defined.--For purposes of this 
                        subparagraph, the term Savings Association 
                        Insurance Fund assessment base means--
                                    ``(I) the assessment base of 
                                Savings Association Insurance Fund 
                                members on which assessments are 
                                imposed under the risk-based assessment 
                                system established pursuant to 
                                paragraph (1); and
                                    ``(II) in the case of an 
                                institution described in clause 
                                (i)(II), the adjusted attributable 
                                deposit amount determined under 
                                subparagraph (C) of section 5(d)(3) for 
                                purposes of subparagraph (B)(i) of such 
                                section.
                    ``(C) Special rules for certain exempt 
                institutions.--
                            ``(i) In general.--The Board of Directors 
                        may exempt any weak insured depository 
                        institution from the payment of the assessment 
                        imposed under subparagraph (B)(i) if the 
                        exemption would reduce risk to the Savings 
                        Association Insurance Fund.
                            ``(ii) Continuation of assessment rates 
                        applicable as of june 30, 1995.--
                        Notwithstanding any other provision of this 
                        subsection or any determination by the 
                        Corporation pursuant to paragraph (2), the 
                        semiannual assessment rate applicable under 
                        paragraph (2) during the period beginning on 
                        January 1, 1996, and ending on December 31, 
                        1999, with respect to any insured depository 
                        institution which receives an exemption under 
                        clause (i) shall be the semiannual assessment 
                        rate which would be applicable to such 
                        institution under paragraph (2) if such 
                        assessment rate were calculated in the manner 
                        in which semiannual assessment rates for 
                        Savings Association Insurance Fund members were 
                        determined by the Corporation under such 
                        paragraph as of June 30, 1995.
                            ``(iii) Special rule for oakar banks.--If 
                        an insured depository institution to which 
                        clause (ii) applies is an institution described 
                        in subparagraph (B)(i)(II), section 5(d)(3) (as 
                        in effect on September 13, 1995) shall continue 
                        to apply with respect to such institution for 
                        purposes of clause (ii) without regard to the 
                        repeal of such section by section 2202(c) of 
                        the Thrift Charter Conversion Act of 1995.
                            ``(iv) Deposit of assessment.--Assessments 
                        imposed under paragraph (2) in accordance with 
                        clause (i) on depository institutions to which 
                        such clause applies shall be deposited--
                                    ``(I) in the Savings Association 
                                Insurance Fund until such fund is 
                                merged into the deposit insurance fund 
                                pursuant to section 2203(a)(2) of the 
                                Thrift Charter Conversion Act of 1995; 
                                and
                                    ``(II) after such merger, in the 
                                deposit insurance fund.
                            ``(v) Guidelines.--
                                    ``(I) Guidelines required.--Not 
                                later than 30 days after the date of 
                                the enactment of the Thrift Charter 
                                Conversion Act of 1995, the Board of 
                                Directors shall prescribe guidelines 
                                containing the criteria to be used by 
                                the Board of Directors in making any 
                                determination under clause (i).
                                    ``(II) Publication.--The guidelines 
                                prescribed under subclause (I) shall be 
                                published in the Federal Register.
                    ``(D) Pro rata payment of special assessment by 
                exempt institutions authorized.--In the case of any 
                depository institution which receives an exemption 
                under subparagraph (C)(i) from the special assessment 
                imposed under subparagraph (B) and any successor to 
                such institution, subparagraph (C)(ii) shall cease to 
                apply with respect to such institution as of the date 
                on which the institution makes a payment to the 
                Corporation, on such terms as the Board of Directors 
                may prescribe, in an amount equal to the product of--
                            ``(i) 12.5 percent of the product of--
                                    ``(I) the Savings Association 
                                Insurance Fund assessment base of the 
                                institution which would have been used 
                                in the calculation of the amount of 
                                such special assessment if the 
                                institution had not received the 
                                exemption from such assessment; and
                                    ``(II) the percentage rate 
                                calculated by the Board of Directors 
                                under subparagraph (B)(ii) for use in 
                                determining the amount of the special 
                                assessment for depository institutions 
                                which did not receive an exemption 
                                under subparagraph (C); and
                            ``(ii) the whole number of full semiannual 
                        periods which begin after the date of such 
                        payment and end before January 1, 2000.
                    ``(E) Assessment for certain deposits.--
                            ``(i) In general.--Notwithstanding any 
                        other provision of law, in carrying out the 
                        special assessment under subparagraph (B), the 
                        Corporation may set assessment rates on the 
                        basis of the factors described in clause (iii) 
                        for deposits treated under section 5(d)(3) as 
                        deposits insured by the Savings Association 
                        Insurance Fund.
                            ``(ii) Minimum rate.--Notwithstanding 
                        clause (i), any rate assessed under such clause 
                        may not be less than 2/3 of the assessment rate 
                        imposed under subparagraph (B).
                            ``(iii) Factors.--In setting any assessment 
                        rate under clause (i), the Corporation shall 
                        consider the following factors:
                                    ``(I) The extent to which deposits 
                                treated under section 5(d)(3) as 
                                deposits insured by the Savings 
                                Association Insurance Fund do not 
                                reflect the actual amount of deposits 
                                insured by such fund because of the 
                                growth attribution rule contained in 
                                clause (iii) of such section.
                                    ``(II) The ability of an insured 
                                depository institution to demonstrate 
                                with deposit data the amount of actual 
                                deposits which should be treated as 
                                deposits insured by the Savings 
                                Association Insurance Fund 
                                notwithstanding the growth attribution 
                                rule referred to in subclause (I).
                            ``(iv) No net budget effect.--
                        Notwithstanding any other provision of this 
                        subparagraph, the Corporation shall not set any 
                        assessment rate under clause (i) that would 
                        result in an increased budget outlay or a 
                        decrease in offsetting receipts under this 
                        paragraph.''.

SEC. 2202. ASSESSMENTS ON INSURED DEPOSITORY INSTITUTIONS.

    (a) Financing Corporation Assessments on all FDIC-Insured 
Depository Institutions.--Section 21(f) of the Federal Home Loan Bank 
Act (12 U.S.C. 1441(f)) is amended--
            (1) in the portion of paragraph (2) which precedes 
        subparagraph (A)--
                    (A) by striking ``each Savings Association 
                Insurance Fund member'' and inserting ``each insured 
                depository institution (as defined in section 3(c)(2) 
                of the Federal Deposit Insurance Act)''; and
                    (B) by striking ``such members'' and inserting 
                ``such institutions''; and
            (2) by striking ``, except that--'' and all that follows 
        through the end of the paragraph and inserting ``, except that 
        the Financing Corporation shall have first priority to make the 
        assessment.''.
    (b) Assessment Rates for SAIF Members May Not Be Less Than 
Assessment Rates for BIF Members.--Section 7(b)(2)(F) of the Federal 
Deposit Insurance Act (12 U.S.C. 1817(b)(2)(F)) is amended--
            (1) by striking ``and'' at the end of clause (i);
            (2) by striking the period at the end of clause (ii) and 
        inserting ``; and''; and
            (3) by adding at the end the following new clause:
                            ``(iii) notwithstanding any other provision 
                        of this subsection, assessment rates for 
                        Savings Association Insurance Fund members may 
                        not be less than assessment rates for Bank 
                        Insurance Fund members.''.
    (c) Repeal of Exit Moratorium and Oakar Bank Provisions.--Effective 
January 1, 1998, section 5(d) of the Federal Deposit Insurance Act (12 
U.S.C. 1815(d)) is amended by striking paragraphs (2) and (3).
    (d) Technical and Conforming Amendments.--
            (1) Section 7(b)(2)(D) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1817(b)(2)(D)) is amended by striking ``Savings 
        Association Insurance Fund members'' and inserting ``members of 
        a deposit insurance fund''.
            (2) Section 21(k) of the Federal Home Loan Bank Act (12 
        U.S.C. 1441(k)) is amended--
                    (A) by striking paragraph (1); and
                    (B) by redesignating paragraphs (2) and (3) as 
                paragraphs (1) and (2), respectively.
    (e) Effective Date.--The amendments made by subsections (a), (b), 
and (d) shall take effect on January 1, 1996.

SEC. 2203. MERGER OF BANK INSURANCE FUND AND SAVINGS ASSOCIATION 
                    INSURANCE FUND AFTER RECAPITALIZATION OF SAIF.

    (a) Establishment of Deposit Insurance Fund.--
            (1) In general.--Effective January 1, 1998, section 
        11(a)(5) of the Federal Deposit Insurance Act (12 U.S.C. 
        1821(a)(5)) is amended to read as follows:
            ``(5) Deposit insurance fund.--
                    ``(A) Establishment.--There is established a fund 
                to be known as the deposit insurance fund which shall--
                            ``(i) be maintained and administered by the 
                        Corporation; and
                            ``(ii) initially consist of the assets and 
                        liabilities of the Bank Insurance Fund and 
                        Savings Association Insurance Fund which have 
                        been merged by the Corporation into the deposit 
                        insurance fund pursuant to section 2203(a)(2) 
                        of the Thrift Charter Conversion Act of 1995, 
                        other than any assets of the Savings 
                        Association Insurance Fund which have been 
                        deposited in the special reserve of the deposit 
                        insurance fund pursuant to section 2203(b)(2) 
                        of such Act.
                    ``(B) Uses.--The deposit insurance fund shall be 
                available to the Corporation for use in carrying out 
                the insurance purposes of the Corporation in accordance 
                with this Act with respect to insured depository 
                institutions.
                    ``(C) Deposits.--All amounts assessed against 
                insured depository institutions by the Corporation 
                shall be deposited into the deposit insurance fund.''.
            (2) Merger by corporation.--Except with respect to any 
        assets of the Savings Association Insurance Fund which are 
        required to be deposited in the special reserve of the deposit 
        insurance fund pursuant to subsection (b)(2), the Corporation 
        shall merge the Bank Insurance Fund and the Savings Association 
        Insurance Fund on January 1, 1998, into the deposit insurance 
        fund established by the amendment made by paragraph (1).
    (b) Establishment of Special Reserve of the Deposit Insurance 
Fund.--
            (1) In general.--Effective January 1, 1998, section 
        11(a)(6) of the Federal Deposit Insurance Act (12 U.S.C. 
        1821(a)(6)) is amended to read as follows:
            ``(6) Special reserve of the deposit insurance fund.--
                    ``(A) In general.--There is established a fund to 
                be known as the special reserve of the deposit 
                insurance fund which shall--
                            ``(i) be maintained and administered by the 
                        Corporation; and
                            ``(ii) initially consist of amounts 
                        deposited in the special reserve pursuant to 
                        section 2203(b)(2) of the Thrift Charter 
                        Conversion Act of 1995.
                    ``(B) Emergency use of special reserve.--
                            ``(i) Use authorized.--Subject to clause 
                        (ii) and notwithstanding subparagraph (C), the 
                        Corporation may, in the sole discretion of the 
                        Board of Directors, transfer amounts from the 
                        special reserve for deposit in the deposit 
                        insurance fund for use in accordance with 
                        paragraph (5)(B).
                            ``(ii) Conditions on transfer.--The Board 
                        of Directors may authorize a transfer under 
                        clause (i) only if--
                                    ``(I) the Board of Directors 
                                determines that the reserve ratio of 
                                the deposit insurance fund is less than 
                                50 percent of the designated reserve 
                                ratio; and
                                    ``(II) the Board of Directors finds 
                                that the reserve ratio of the deposit 
                                insurance will likely be less than the 
                                designated reserve ratio of the fund 
                                for each of the 4 calendar quarters 
                                beginning after the date of such 
                                determination.
                    ``(C) No refunds or other uses authorized.--Except 
                as provided in subparagraph (B), the Corporation may 
                not make any payment from the special reserve, make any 
                refund or provide any credit to any insured depository 
                institution with respect to any amount in the special 
                reserve, or use any amount in the special reserve for 
                any other purpose (including the use of any such amount 
                as security for the repayment of any obligation of the 
                Corporation).
                    ``(D) Exclusion of special reserve in calculating 
                the reserve ratio.--No amount in the special reserve 
                may be taken into account in calculating the reserve 
                ratio of the deposit insurance fund under section 7.''.
            (2) Transfer and deposit by corporation.--If, at the time 
        of the merger of the Bank Insurance Fund and the Savings 
        Association Insurance Fund pursuant to subsection (a)(2), the 
        reserve ratio of the Savings Association Insurance Fund exceeds 
        the designated reserve ratio, the Corporation shall transfer 
        from such fund to the special reserve of the deposit insurance 
        fund established by the amendment made by paragraph (1) an 
        amount equal to the amount which causes the reserve ratio of 
        the Savings Association Insurance Fund to exceed the designated 
        reserve ratio.
    (c) Technical and Conforming Amendments.--
            (1) Section 3(y) of the Federal Deposit Insurance Act (12 
        U.S.C. 1813(y)) is amended by striking ``the Bank Insurance 
        Fund or the Savings Association Insurance Fund, as 
        appropriate'' and inserting ``the deposit insurance fund 
        established under section 11(a)(5)''.
            (2) Section 11(a) of the Federal Deposit Insurance Act (12 
        U.S.C. 1821(a)) is amended by striking paragraphs (4)(A) and 
        (7).
            (3) Section 5(d)(1) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1815(d)(1)) is amended--
                    (A) in subparagraph (A), by striking ``reserve 
                ratios'' and all that follows through the period and 
                inserting ``the reserve ratio of the deposit insurance 
                fund.'';
                    (B) by striking subparagraph (B); and
                    (C) by redesignating subparagraph (C) as 
                subparagraph (B).
            (4) Section 7 of the Federal Deposit Insurance Act (12 
        U.S.C. 1817) is amended by striking subsection (l).
            (5) Section 7(b)(2) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1817(b)(2)) is amended--
                    (A) by striking subparagraphs (B), (F), and (G);
                    (B) in clauses (i) and (iv) of subparagraph (A), by 
                striking ``each deposit insurance fund'' and inserting 
                ``the deposit insurance fund'';
                    (C) in subparagraph (A)(iii), by striking ``a 
                deposit insurance fund'' and inserting ``the deposit 
                insurance fund''; and
                    (D) by inserting after subparagraph (E) the 
                following new subparagraph:
                    ``(F) Reserve ratio defined.--For purposes of this 
                subsection, the term `reserve ratio' means the ratio of 
                the net worth of the deposit insurance fund to the 
                aggregate estimated insured deposits held in all 
                insured depository institutions.''.
            (6) Section 7(b)(3) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1817(b)(3)) is amended--
                    (A) in subparagraph (A) by striking ``any deposit 
                insurance fund'' and inserting ``the deposit insurance 
                fund''; and
                    (B) by striking subparagraphs (C) and (D).
            (7) Subparagraph (A) of section 7(b)(6) of the Federal 
        Deposit Insurance Act (12 U.S.C. 1817(b)(6)) (as so 
        redesignated by section 2201 of this subtitle) is amended--
                    (A) in clause (i)--
                            (i) by inserting ``or'' after the semicolon 
                        at the end of subclause (I);
                            (ii) by striking subclause (II); and
                            (iii) by striking ``; and'' at the end of 
                        subclause (III) and inserting a period; and
                    (B) by striking clause (ii).
            (8) Section 11(a)(4)(B) of the Federal Deposit Insurance 
        Act (12 U.S.C. 1821(a)(4)(B)) is amended by striking ``Bank 
        Insurance Fund and the Savings Association Insurance Fund'' and 
        inserting ``deposit insurance fund''.
            (9) Paragraph (1) of section 11(f) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1821(f)) is amended by striking 
        ``depositor, except that--'' and all that follows through the 
        period at the end of the paragraph and inserting 
        ``depositor.''.
            (10) Section 11(i)(3) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1821(i)(3)) is amended--
                    (A) by striking subparagraph (B); and
                    (B) in subparagraph (C), by striking 
                ``subparagraphs (A) and (B)'' and inserting 
                ``subparagraph (A)''.
            (11) Section 11A(a)(3) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1821a(a)(3)) is amended by striking ``Bank Insurance 
        Fund, the Savings Association Insurance Fund,'' and inserting 
        ``deposit insurance fund''.
            (12) Section 11A(f) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1821a(f)) is amended by striking ``Savings 
        Association Insurance Fund'' and inserting ``deposit insurance 
        fund''.
            (13) Section 13(a)(1) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1823(a)(1)) is amended by striking ``Bank Insurance 
        Fund, the Savings Association Insurance Fund,'' and inserting 
        ``deposit insurance fund, the special reserve of the deposit 
        insurance fund,''.
            (14) Section 13(c)(4)(G)(ii) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1823(c)(4)(G)(ii)) is amended--
                    (A) by striking ``appropriate insurance fund'' and 
                inserting ``deposit insurance fund'';
                    (B) by striking ``the members of the insurance fund 
                (of which such institution is a member)'' and inserting 
                ``insured depository institutions'';
                    (C) by striking ``each member's'' and inserting 
                ``each insured depository institution's''; and
                    (D) by striking ``the member's'' each place such 
                term appears and inserting ``the institution's''.
            (15) Section 13(c) of the Federal Deposit Insurance Act (12 
        U.S.C. 1823(c)) is amended by striking paragraph (11).
            (16) Section 13(h) of the Federal Deposit Insurance Act (12 
        U.S.C. 1823(h)) is amended by striking ``Bank Insurance Fund'' 
        and inserting ``deposit insurance fund''.
            (17) Section 14(a) of the Federal Deposit Insurance Act (12 
        U.S.C. 1824(a)) is amended--
                    (A) by striking ``Bank Insurance Fund or the 
                Savings Association Insurance Fund'' and inserting 
                ``deposit insurance fund''; and
                    (B) by striking ``each such fund'' and inserting 
                ``the fund''.
            (18) Section 14(b) of the Federal Deposit Insurance Act (12 
        U.S.C. 1824(b)) is amended by striking ``Bank Insurance Fund or 
        Savings Association Insurance Fund'' and inserting ``deposit 
        insurance fund''.
            (19) Section 14(c) of the Federal Deposit Insurance Act (12 
        U.S.C. 1824(c)) is amended by striking paragraph (3).
            (20) Section 14 of the Federal Deposit Insurance Act (12 
        U.S.C. 1824) is amended by striking subsection (d).
            (21) Section 15(c)(5) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1825(c)(5)) is amended--
                    (A) by striking ``Bank Insurance Fund or Savings 
                Association Insurance Fund, respectively,'' and 
                inserting ``deposit insurance fund'';
                    (B) by striking ``Bank Insurance Fund or Savings 
                Association Insurance Fund, respectively;'' and 
                inserting ``deposit insurance fund;''; and
                    (C) by striking ``Bank Insurance Fund or the 
                Savings Association Insurance Fund, respectively,'' and 
                inserting ``deposit insurance fund,''.
            (22) Section 17(a)(1) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1827(a)(1)) is amended by striking ``Bank Insurance 
        Fund, the Savings Association Insurance Fund,'' each place such 
        term appears and inserting ``deposit insurance fund''.
            (23) Section 17(d) of the Federal Deposit Insurance Act (12 
        U.S.C. 1827(d)) is amended by striking ``Bank Insurance Fund, 
        the Savings Association Insurance Fund,'' each place such term 
        appears and inserting ``deposit insurance fund''.
            (24) The heading for section 17(a) of the Federal Deposit 
        Insurance Act (12 U.S.C. 1827(a)) is amended by striking ``BIF, 
        SAIF,'' and inserting ``the Deposit Insurance Fund''.
            (25) Subsections (a)(1) and (d)(1)(A) of section 24 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1831a) are each 
        amended by striking ``appropriate''.
            (26) Section 24(e)(2) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1831a(e)(2)) is amended--
                    (A) in subparagraph (A), by striking ``of which 
                such banks are members''; and
                    (B) in subparagraph (B)(ii), by striking ``of which 
                such bank is a member''.
            (27) Section 24(f)(6)(B) of the Federal Deposit Insurance 
        Act (12 U.S.C. 1831a(f)(6)(B)) is amended by striking ``of 
        which such bank is a member''.
            (28) Section 31 of the Federal Deposit Insurance Act (12 
        U.S.C. 1831h) is hereby repealed.
            (29) Section 36(i)(3) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1831m(i)(3)) is amended by striking ``affected''.
            (30) Section 38 of the Federal Deposit Insurance Act (12 
        U.S.C. 1831o) is amended by striking subsection (o).
            (31) Section 21B(f)(2)(C)(ii) of the Federal Home Loan Bank 
        Act (12 U.S.C. 1441b(f)(2)(C)(ii)) is amended to read as 
        follows:
                            ``(C) Payments by federal home loan 
                        banks.--To the extent the amounts available 
                        pursuant to subparagraphs (A) and (B) are 
                        insufficient to cover the amount of interest 
                        payments, each Federal home loan bank shall pay 
                        to the Funding Corporation each calendar year 
                        an amount equal to 22.63 percent of the bank's 
                        net earnings for the year for which such amount 
                        is required to be paid.''.
    (d) Effective Date of Amendments.--The amendments made by 
subsection (c) shall take effect on January 1, 1998.

SEC. 2204. REFUND OF AMOUNTS IN DEPOSIT INSURANCE FUND IN EXCESS OF 
                    DESIGNATED RESERVE AMOUNT.

    Subsection (e) of section 7 of the Federal Deposit Insurance Act 
(12 U.S.C. 1817(e)) is amended to read as follows:
    ``(e) Refunds.--
            ``(1) Overpayments.--In the case of any payment of an 
        assessment by an insured depository institution in excess of 
        the amount due to the Corporation, the Corporation may--
                    ``(A) refund the amount of the excess payment to 
                the insured depository institution; or
                    ``(B) credit such excess amount toward the payment 
                of subsequent semiannual assessments until such credit 
                is exhausted.
            ``(2) Balance in insurance fund in excess of designated 
        reserve.--
                    ``(A) In general.--Subject to subparagraph (B), if 
                as of the end of any semiannual period the amount of 
                the actual reserves in--
                            ``(i) the Bank Insurance Fund (until the 
                        merger of such fund into the deposit insurance 
                        fund pursuant to section 2203(a)(2) of the 
                        Thrift Charter Conversion Act of 1995); or
                            ``(ii) the deposit insurance fund (after 
                        the establishment of such fund under section 
                        2203(a)(1) of such Act),
                exceeds the balance required to meet the designated 
                reserve ratio applicable with respect to such fund, 
                such excess amount shall be refunded to members of the 
                fund by the Corporation on such basis as the Board of 
                Directors determines to be appropriate, taking into 
                account the factors considered under the risk-based 
                assessment system.
                    ``(B) Refund not to exceed previous semiannual 
                assessment.--The amount of any refund under this 
                paragraph to any member of a deposit insurance fund for 
                any semiannual period may not exceed the total amount 
                of assessments paid by such member to the insurance 
                fund with respect to such period.''.

SEC. 2205. ASSESSMENTS AUTHORIZED ONLY IF NEEDED TO MAINTAIN THE 
                    RESERVE RATIO OF A DEPOSIT INSURANCE FUND.

    (a) In General.--Section 7(b)(2)(A)(i) of the Federal Deposit 
Insurance Act (12 U.S.C. 1817(b)(2)(A)(i)) is amended in the portion of 
such section preceding subclause (I) by inserting ``when necessary, and 
only to the extent necessary'' after ``insured depository 
institutions''.
    (b) Limitation on Assessment.--Section 7(b)(2)(A)(iii) of the 
Federal Deposit Insurance Act (12 U.S.C. 1817(b)(2)(A)(iii)) is amended 
to read as follows:
                            ``(iii) Limitation on assessment.--The 
                        Board of Directors shall not set semiannual 
                        assessments with respect to a deposit insurance 
                        fund in excess of the amount needed--
                                    ``(I) to maintain the reserve ratio 
                                of the fund at the designated reserve 
                                ratio; or
                                    ``(II) if the reserve ratio is less 
                                than the designated reserve ratio, to 
                                increase the reserve ratio to the 
                                designated reserve ratio.''.

          CHAPTER 2--STATUS OF BANKS AND SAVINGS ASSOCIATIONS

SEC. 2221. TERMINATION OF FEDERAL SAVINGS ASSOCIATIONS; TREATMENT OF 
                    STATE SAVINGS ASSOCIATIONS AS BANKS FOR PURPOSES OF 
                    FEDERAL BANKING LAW.

    (a) Termination of Federal Savings Association Charters.--
            (1) In general.--Each Federal savings association shall--
                    (A) convert to a national bank charter;
                    (B) convert to a State depository institution 
                charter; or
                    (C) surrender the charter of such savings 
                association and liquidate the institution.
            (2) Conversion to national bank by operation of law.--If 
        any Federal savings association has not taken any action 
        required under paragraph (1) as of January 1, 1998, the savings 
        association shall--
                    (A) become a national bank on such date by 
                operation of law;
                    (B) immediately file articles of association and an 
                organizational certificate with the Comptroller of the 
                Currency in accordance with sections 5133, 5134, and 
                5135 of the Revised Statutes of the United States; and
                    (C) cease to exist as a Federal savings association 
                as of such date.
            (3) Prohibition on new charters of federal savings 
        associations.--The Director of the Office of Thrift Supervision 
        may not grant any charter for a Federal savings association for 
        which an application was received after the date of the 
        enactment of this Act.
    (b) Treatment of State Savings Associations as Banks For Purposes 
of Federal Banking Law.--
            (1) Amendments to federal deposit insurance act.--Section 3 
        of the Federal Deposit Insurance Act (12 U.S.C. 1813) is 
        amended--
                    (A) by striking paragraph (2) of subsection (a) and 
                inserting the following new paragraph:
            ``(2) State bank.--
                    ``(A) In general.--The term `State bank' means any 
                bank, banking association, trust company, savings bank, 
                industrial bank (or similar depository institution 
                which the Board of Directors finds to be operating 
                substantially in the same manner as an industrial 
                bank), building and loan association, savings and loan 
                association, homestead association, cooperative bank, 
                or other banking institution--
                            ``(i) which is engaged in the business of 
                        receiving deposits, other than trust funds (as 
                        defined in this section); and
                            ``(ii) which--
                                    ``(I) is incorporated under the 
                                laws of any State;
                                    ``(II) is organized and operating 
                                according to the laws of the State in 
                                which such institution is chartered or 
                                organized; or
                                    ``(III) is operating under the Code 
                                of Law for the District of Columbia 
                                (except a national bank).
                    ``(B) Certain insured banks included.--The term 
                `State bank' includes any cooperative bank or other 
                unincorporated bank the deposits of which were insured 
                by the Corporation on the day before the date of the 
                enactment of the Financial Institutions Reform, 
                Recovery, and Enforcement Act of 1989.
                    ``(C) Certain uninsured banks excluded.--The term 
                `State bank' does not include any cooperative bank or 
                other unincorporated bank the deposits of which were 
                not insured by the Corporation on the day before the 
                date of the enactment of the Financial Institutions 
                Reform, Recovery, and Enforcement Act of 1989.''; and
                    (B) in subsection (q)--
                            (i) by inserting ``and'' after the 
                        semicolon at the end of paragraph (2);
                            (ii) by striking ``; and'' at the end of 
                        paragraph (3) and inserting a period; and
                            (iii) by striking paragraph (4).
            (2) Amendments to the bank holding company act of 1956.--
        Section 2 of the Bank Holding Company Act of 1956 (12 U.S.C. 
        1841) is amended--
                    (A) by striking subparagraph (E) of subsection 
                (a)(5); and
                    (B) by striking subparagraphs (B) and (J) of 
                subsection (c)(2).
            (3) Amendments to the federal reserve act.--The 2d and 3d 
        paragraphs of the 1st section of the Federal Reserve Act (12 
        U.S.C. 221) are each amended by inserting ``(as defined in 
        section 3(a)(2) of the Federal Deposit Insurance Act)'' after 
        ``State bank''.

SEC. 2222. TREATMENT OF CERTAIN ACTIVITIES AND AFFILIATIONS OF BANK 
                    HOLDING COMPANIES RESULTING FROM THIS ACT.

    Section 4 of the Bank Holding Company Act of 1956 (12 U.S.C. 1843) 
is amended by adding at the end the following new subsection:
    ``(k) Treatment of Companies Resulting From Savings and Loan 
Holding Companies.--
            ``(1) In general.--Notwithstanding any other provision of 
        this section (other than paragraph (5)) or any other provision 
        of Federal law including sections 20 and 32 of the Banking Act 
        of 1933, a qualified bank holding company may, after such 
        company becomes a bank holding company--
                    ``(A) maintain or enter into any nonbanking 
                affiliation which such company was authorized to 
                maintain or enter into as of September 22, 1995, or was 
                authorized to maintain following a merger of insured 
                depository institution subsidiaries pursuant to an 
                application filed no later than such date; and
                    ``(B) engage, directly or through any affiliate 
                described in subparagraph (A) which is not a bank, in 
                any activity in which such company or any affiliate 
                described in subparagraph (A) was authorized to engage 
                as of September 22, 1995, or in which such company was 
                authorized to engage following a merger of insured 
                depository institution subsidiaries pursuant to an 
                application filed no later than such date,
        if the requirements of paragraph (4) are met.
            ``(2) Qualified bank holding company defined.--For purposes 
        of this subsection, the term `qualified bank holding company' 
        means--
                    ``(A) any company which--
                            ``(i) as of September 13, 1995, is a 
                        savings and loan holding company and is not a 
                        bank holding company; and
                            ``(ii) becomes a bank holding company after 
                        such date; and
                    ``(B) any bank holding company which as of 
                September 13, 1995--
                            ``(i) is a savings and loan holding 
                        company; and
                            ``(ii) is exempt from this section pursuant 
                        to an order issued by the Board under 
                        subsection (d).
            ``(3) No loss of subsection (d) exemption.--No qualified 
        bank holding company described in paragraph (2)(B) shall lose 
        the grounds for the exemption under subsection (d) because a 
        savings association which such company controlled, directly or 
        indirectly, as of September 13, 1995, becomes a bank after such 
        date so long as such bank continues to meet the requirements of 
        subparagraphs (A) and (B) of paragraph (4).
            ``(4) Prerequisites for continuation of grandfathered 
        activities and affiliations.--This subsection shall cease to 
        apply with respect to a qualified bank holding company if, at 
        any time after such company first meets the definition of a 
        qualified bank holding company--
                    ``(A) any insured depository institution controlled 
                by such company which, as of the day before the company 
                first meets the definition of a qualified bank holding 
                company, was subject to the requirements contained in 
                section 10(m) of the Home Owners' Loan Act, as in 
                effect on such date, (and regulations in effect on such 
                date under such section) for treatment as a qualified 
                thrift lender under such section fails to meet such 
                requirements;
                    ``(B) any insured depository institution controlled 
                by such company fails to comply with any limitation or 
                restriction on the type or amounts of loans or 
                investments of the institution to which such 
                institution was subject as of the date of the enactment 
                of the Thrift Charter Conversion Act of 1995; or
                    ``(C) the company or any subsidiary of the company 
                acquires more than 5 percent of the shares or assets of 
                any bank or insured institution after September 13, 
                1995.
            ``(5) Nontransferable.--This subsection shall not apply 
        with respect to any qualified bank holding company if, after 
        September 13, 1995, any person acquires, directly or 
        indirectly, control of the company or the company is the 
        subject of any merger, consolidation, or other similar 
        transaction.
            ``(6) Prohibition on certain insured depository 
        institutions identifying themselves as national banks.--
                    ``(A) In general.--Notwithstanding the requirement 
                of section 5134 of the Revised Statutes of the United 
                States--
                            ``(i) the name of an insured depository 
                        institution subsidiary of a qualified bank 
                        holding company which--
                                    ``(I) as of the date of the 
                                enactment of the Thrift Charter 
                                Conversion Act of 1995, is a savings 
                                and loan holding company described in 
                                section 10(c)(3) of the Home Owners' 
                                Loan Act (as in effect on such date); 
                                and
                                    ``(II) is subject to the 
                                restrictions contained in paragraph 
                                (3),
                        may not include the term `national'; and
                            ``(ii) such insured depository institution 
                        may not be identified as a national bank on any 
                        sign displayed by the institution or in any 
                        advertisement or other publication of the 
                        institution.
                    ``(B) Depository institution not liable for 
                fraudulent misrepresentation for not representing 
                itself as a national bank.--An insured depository 
                institution which is subject to subparagraph (A) shall 
                not be liable for any civil or criminal penalty under 
                any Federal or State consumer protection law, or in any 
                criminal or civil action, for fraudulently 
                misrepresenting the nature of the charter of the 
                institution, for falsely advertising the status of the 
                institution, for making a false statement with respect 
                to the status of the institution, or for any similar 
                offense by reason of the institution's compliance with 
                such subparagraph.
            ``(7) Enforcement.--In addition to any other power of the 
        Board, the Board may enforce compliance with the provisions of 
        this subsection with respect to any qualified bank holding 
        company and any bank controlled by such company under section 8 
        of the Federal Deposit Insurance Act.''.

SEC. 2223. TRANSITION PROVISIONS FOR ACTIVITIES OF SAVINGS ASSOCIATIONS 
                    WHICH CONVERT INTO OR BECOME TREATED AS BANKS.

    Notwithstanding any other provision of Federal law, any insured 
depository institution which, as of September 13, 1995, is a savings 
association (as defined in section 3(b) of the Federal Deposit 
Insurance Act (as in effect on such date)) and after such date converts 
to a national or State bank charter or becomes treated as a State bank 
pursuant to the amendment made by section 2221(b) may continue to 
engage, directly or indirectly, in any activity in which such 
institution was lawfully engaged as of such date during the 5-year 
period beginning on the effective date of such conversion or the 
effective date of such amendments, as the case may be.

SEC. 2224. REGISTRATION OF BANK HOLDING COMPANIES RESULTING FROM 
                    CONVERSIONS OF SAVINGS ASSOCIATIONS TO BANKS OR 
                    TREATMENT OF SAVINGS ASSOCIATIONS AS BANKS.

    Section 3 of the Bank Holding Company Act of 1956 (12 U.S.C. 1842) 
is amended by adding at the end the following new subsections:
    ``(h) Registration of Certain Bank Holding Companies.--A company 
which, as of September 13, 1995, is a savings and loan holding company 
(as defined in section 10(a)(1)(D) of Home Owners' Loan Act (as in 
effect on such date)) and is not a bank holding company shall not be 
required to obtain the approval of the Board under subsection (a) to 
become a bank holding company after September 13, 1995, as a result of 
the conversion of any insured depository institution subsidiary of such 
company into a bank or by virtue of the treatment of any insured 
depository institution subsidiary of such company as a bank pursuant to 
the amendments made by the Thrift Charter Conversion Act of 1995, if 
such company--
            ``(1) registers as a bank holding company with the Board in 
        accordance with section 5(a); and
            ``(2) does not acquire, directly or indirectly, ownership 
        or control of any additional insured depository institution or 
        other company in connection with such conversion or treatment.
    ``(i) Regulation of Qualified Bank Holding Companies.--The Board 
shall regulate qualified bank holding companies (as defined in section 
4(k)(2)) in a manner consistent with--
            ``(1) the regulation of such companies by the Director of 
        the Office of Thrift Supervision before the date of the 
        enactment of the Thrift Charter Conversion Act of 1995; and
            ``(2) the safety and soundness of insured depository 
        institution subsidiaries of such companies.''.

SEC. 2225. ADDITIONAL TRANSITION PROVISIONS AND SPECIAL RULES.

    (a) Mutual National Banks Authorized; Conversion of Mutual Savings 
Associations Into National Banks.--
            (1) In general.--Chapter one of title LXII of the Revised 
        Statutes of the United States (12 U.S.C. 21 et seq.) is amended 
        by inserting after section 5133 the following new section:

``SEC. 5133A. MUTUAL NATIONAL BANKS.

    ``(a) In General.--Notwithstanding the paragraph designated the 
``Third'' of section 5134, the Comptroller of the Currency may charter 
national banks organized in the mutual form either de novo or through a 
conversion of any stock national or State bank (as defined in section 3 
of the Federal Deposit Insurance Act) or any State mutual bank or 
credit union, subject to regulations prescribed by the Comptroller of 
the Currency in accordance with this section.
    ``(b) Regulations.--
            ``(1) Transition rules.--National banks organized in the 
        mutual form shall be subject to the regulations of the Director 
        of the Office of Thrift Supervision governing corporate 
        organization, governance, and conversion of mutual 
        institutions, as in effect on September 13, 1995, including 
        parts 543, 544, 546, 563b, and 563c of chapter V of title 12 of 
        the Code of Federal Regulations (as in effect on such date), 
        during the 3-year period beginning on the date of the enactment 
        of the Thrift Charter Conversion Act of 1995.
            ``(2) Regulations of the comptroller.--The Comptroller of 
        the Currency shall prescribe appropriate regulations for 
        national banks organized in the mutual form, effective as of 
        the end of the 3-year period referred to in paragraph (1).
            ``(3) Applicability of capital stock requirements.--The 
        Comptroller of the Currency shall prescribe regulations 
        regarding the manner in which requirements of title LXII of the 
        Revised Statutes of the United States with respect to capital 
        stock, and limitations imposed on national banks under such 
        title based on capital stock, shall apply to national banks 
        organized in mutual form pursuant to subsection (a).
    ``(c) Conversions.--
            ``(1) Conversion to stock national bank.--Subject to 
        subsection (b)(1) and, after the end of the 3-year period 
        referred to in such subsection, such regulations as the 
        Comptroller of the Currency may prescribe for the protection of 
        depositors' rights and for any other purpose the Comptroller of 
        the Currency may consider appropriate, any national bank which 
        is organized in mutual form pursuant to paragraph (1) may 
        reorganize as a stock national bank.
            ``(2) Conversions to state banks.--Any national mutual bank 
        may convert to a State bank charter in accordance with 
        regulations prescribed by the Comptroller of the Currency and 
        applicable State law.''.
            (2) Mutual bank holding companies.--Subsection (g) of 
        section 3 of the Bank Holding Company Act of 1956 (12 U.S.C. 
        1842(g)) is amended to read as follows:
    ``(g) Mutual Bank Holding Companies.--
            ``(1) In general.--A national mutual bank may reorganize so 
        as to become a holding company by--
                    ``(A) chartering an interim national bank, the 
                stock of which is to be wholly owned, except as 
                otherwise provided in this section, by the national 
                mutual bank; and
                    ``(B) transferring the substantial part of the 
                national mutual bank's assets and liabilities, 
                including all of the bank's insured liabilities, to the 
                interim national bank.
            ``(2) Directors and certain account holders' approval of 
        plan required.--A reorganization is not authorized under this 
        subsection unless--
                    ``(A) a plan providing for such reorganization has 
                been approved by a majority of the board of directors 
                of the national mutual bank; and
                    ``(B) in the case of a national mutual bank in 
                which holders of accounts and obligors exercise voting 
                rights, such plan has been submitted to and approved by 
                a majority of such individuals at a meeting held at the 
                call of the directors in accordance with the procedures 
                prescribed by the bank's charter and bylaws.
            ``(3) Notice to the board; disapproval period.--
                    ``(A) Notice required.--
                            ``(i) In general.--At least 60 days before 
                        taking any action described in paragraph (1), a 
                        national mutual bank seeking to establish a 
                        mutual holding company shall provide written 
                        notice to the Board.
                            ``(ii) Contents of notice.--The notice 
                        shall contain such relevant information as the 
                        Board shall require by regulation or by 
                        specific request in connection with any 
                        particular notice.
                    ``(B) Transaction allowed if not disapproved.--
                Unless the Board within such 60-day notice period 
                disapproves the proposed holding company formation, or 
                extends for another 30 days the period during which 
                such disapproval may be issued, the national mutual 
                bank providing such notice may proceed with the 
                transaction, if the requirements of paragraph (2) have 
                been met.
                    ``(C) Grounds for disapproval.--The Board may 
                disapprove any proposed holding company formation only 
                if--
                            ``(i) such disapproval is necessary to 
                        prevent unsafe or unsound practices;
                            ``(ii) the financial or management 
                        resources of the national mutual bank involved 
                        warrant disapproval;
                            ``(iii) the national mutual bank fails to 
                        furnish the information required under 
                        subparagraph (A); or
                            ``(iv) the national mutual bank fails to 
                        comply with the requirement of paragraph (2).
                    ``(D) Retention of capital assets.--In connection 
                with the transaction described in paragraph (1), a 
                national mutual bank may, subject to the approval of 
                the Board, retain capital assets at the holding company 
                level to the extent that the capital retained at the 
                holding company is in excess of the amount of capital 
                required in order for the interim national bank to meet 
                all relevant capital standards established by the 
                Comptroller of the Currency for national banks.
            ``(4) Ownership.--
                    ``(A) In general.--Persons having ownership rights 
                in the national mutual bank under section 5133A of the 
                Revised Statutes of the United States (including 
                paragraph 575.5 of chapter V of title 12 of the Code of 
                Federal Regulations, as in effect on September 13, 
                1995, and applicable to national mutual banks pursuant 
                to such section) or State law shall have the same 
                ownership rights with respect to the mutual holding 
                company.
                    ``(B) Holders of certain accounts.--Holders of 
                savings, demand, or other accounts of--
                            ``(i) a national bank chartered as part of 
                        a transaction described in paragraph (1); or
                            ``(ii) a mutual bank acquired pursuant to 
                        paragraph (5)(B),
                shall have the same ownership rights with respect to 
                the mutual holding company as persons described in 
                subparagraph (A) of this paragraph.
            ``(5) Permitted activities.--A mutual holding company may 
        engage only in the following activities:
                    ``(A) Investing in the stock of a national or State 
                bank.
                    ``(B) Acquiring a mutual bank through the merger of 
                such bank into a national bank subsidiary of such 
                holding company or an interim national bank subsidiary 
                of such holding company.
                    ``(C) Subject to paragraph (6), merging with or 
                acquiring another holding company, one of whose 
                subsidiaries is a national mutual bank.
                    ``(D) Investing in a corporation the capital stock 
                of which is available for purchase by a national mutual 
                bank under Federal law or under the law of any State 
                where the home office of any subsidiary bank is 
                located.
                    ``(E) Engaging in the activities permitted under 
                section 4(c).
            ``(6) Limitations on certain activities of acquired holding 
        companies.--
                    ``(A) New activities.--If a mutual holding company 
                acquires or merges with another holding company under 
                paragraph (5)(C), the holding company acquired or the 
                holding company resulting from such merger or 
                acquisition may only invest in assets and engage in 
                activities which are authorized under paragraph (5).
                    ``(B) Grace period for divesting prohibited assets 
                or discontinuing prohibited activities.--Not later than 
                2 years following a merger or acquisition described in 
                paragraph (5)(C), the acquired holding company or the 
                holding company resulting from such merger or 
                acquisition shall--
                            ``(i) dispose of any asset which is an 
                        asset in which a mutual holding company may not 
                        invest under paragraph (5); and
                            ``(ii) cease any activity which is an 
                        activity in which a mutual holding company may 
                        not engage under paragraph (5).
            ``(7) Chartering and other requirements.--
                    ``(A) In general.--A mutual holding company shall 
                be chartered by the Board and shall be subject to such 
                regulations as the Board may prescribe.
                    ``(B) Other requirements.--Unless the context 
                otherwise requires, a mutual holding company shall be 
                subject to the other requirements of this Act regarding 
                regulation of holding companies.
            ``(8) Capital improvement.--
                    ``(A) Pledge of stock of savings association 
                subsidiary.--This section shall not prohibit a mutual 
                holding company from pledging all or a portion of the 
                stock of a national bank chartered as part of a 
                transaction described in paragraph (1) to raise capital 
                for such bank.
                    ``(B) Issuance of nonvoting shares.--No provision 
                of this Act shall be construed as prohibiting a 
                national bank chartered as part of a transaction 
                described in paragraph (1) from issuing any nonvoting 
                shares or less than 50 percent of the voting shares of 
                such bank to any person other than the mutual holding 
                company.
            ``(9) Insolvency and liquidation.--
                    ``(A) In general.--Notwithstanding any provision of 
                law, upon--
                            ``(i) the default of any national bank--
                                    ``(I) the stock of which is owned 
                                by any mutual holding company; and
                                    ``(II) which was chartered in a 
                                transaction described in paragraph (1);
                            ``(ii) the default of a mutual holding 
                        company; or
                            ``(iii) a foreclosure on a pledge by a 
                        mutual holding company described in paragraph 
                        (8)(A),
                a trustee shall be appointed receiver of such mutual 
                holding company and such trustee shall have the 
                authority to liquidate the assets of, and satisfy the 
                liabilities of, such mutual holding company pursuant to 
                title 11, United States Code.
                    ``(B) Distribution of net proceeds.--Except as 
                provided in subparagraph (C), the net proceeds of any 
                liquidation of any mutual holding company pursuant to 
                subparagraph (A) shall be transferred to persons who 
                hold ownership interests in such mutual holding 
                company.
                    ``(C) Recovery by corporation.--If the Corporation 
                incurs a loss as a result of the default of any savings 
                association subsidiary of a mutual holding company 
                which is liquidated pursuant to subparagraph (A), the 
                Corporation shall succeed to the ownership interests of 
                the depositors of such savings association in the 
                mutual holding company, to the extent of the 
                Corporation's loss.
            ``(10) State mutual bank holding company.--
                    ``(A) In general.--Notwithstanding any provision of 
                Federal law, a State bank operating in mutual form may 
                reorganize so as to form a holding company under State 
                law.
                    ``(B) Regulation of state mutual holding company.--
                A corporation organized as a holding company in 
                accordance with subparagraph (A) shall be regulated on 
                the same terms and be subject to the same limitations 
                as any other holding company which controls a bank.
            ``(11) Regulations.--
                    ``(A) Transition rules.--Mutual bank holding 
                companies organized under this subsection shall be 
                subject to the regulations of the Director of the 
                Office of Thrift Supervision governing corporate 
                organization, governance, and conversion of mutual 
                institutions, as in effect on September 13, 1995, 
                including part 575 of chapter V of title 12 of the Code 
                of Federal Regulations (as in effect on such date), 
                during the 3-year period beginning on the date of the 
                enactment of the Thrift Charter Conversion Act of 1995.
                    ``(B) Regulations of the board.--The Board shall 
                prescribe appropriate regulations for mutual holding 
                companies, effective at the end of the 3-year period 
                referred to in subparagraph (A).
            ``(12) Definitions.--For purposes of this subsection--
                    ``(A) Mutual holding company.--The term `mutual 
                holding company' means a corporation organized as a 
                holding company under this subsection.
                    ``(B) Default.--The term `default' means an 
                adjudication or other official determination of a court 
                of competent jurisdiction or other public authority 
                pursuant to which a conservator, receiver, or other 
                legal custodian is appointed.
                    ``(C) National mutual bank.--The term `national 
                mutual bank' means a national bank organized in mutual 
                form under section 5133A of the Revised Statutes of the 
                United States.''.
            (3) Limitation on federal regulation of state banks.--
        Except as otherwise provided in Federal law, the Comptroller of 
        the Currency, Board of Governors of the Federal Reserve System, 
        and Federal Deposit Insurance Corporation may not adopt or 
        enforce any regulation which contravenes the corporate 
        governance rules prescribed by State law or regulation for 
        State banks unless the Comptroller, Board, or Corporation finds 
        that such Federal regulation is necessary to assure the safety 
        and soundness of such State banks.
            (4) Conversions of mutual savings associations to mutual 
        national banks by operation of law.--Notwithstanding any other 
        provision of Federal or State law, any savings association (as 
        defined in section 3 of the Federal Deposit Insurance Act (as 
        in effect on September 13, 1995)) which is organized in mutual 
        form as of the date of the enactment of this Act may become a 
        national mutual bank by operation of law if the association--
                    (A) files the articles of association and 
                organization certificate with the Comptroller of the 
                Currency before January 1, 1998, in accordance with 
                chapter one of title LXII of the Revised Statutes of 
                the United States; and
                    (B) provides such other document or information as 
                the Comptroller of the Currency may prescribe in 
                regulations consistent with this section and section 
                5133A of the Revised Statutes of the United States (as 
                added by paragraph (1) of this subsection).
            (5) Clerical amendment.--The table of sections for chapter 
        one of title LXII of the Revised Statutes of the United States 
        (12 U.S.C. 21 et seq.) is amended by inserting after the item 
        relating to section 5133 the following new item:

``5133A.  Mutual national banks.''.

    (b) Membership in Federal Home Loan Banks.--Any insured depository 
institution which--
            (1) as of the date of the enactment of this Act, is a 
        Federal savings association which, pursuant to section 6(e) of 
        the Federal Home Loan Bank Act, may not voluntarily withdraw 
        from membership in a Federal home loan bank; and
            (2) after such date converts from a Federal savings 
        association to a national bank,
shall continue to be subject to the prohibition under such section on 
voluntary withdrawal from such membership as though such bank were 
still a Federal savings association until the bank ceases to be a 
national bank.
    (c) Branches.--
            (1) In general.--Notwithstanding any provision of the 
        Federal Deposit Insurance Act, the Bank Holding Company Act of 
        1956, or any other Federal or State law, any depository 
        institution which--
                    (A) as of the date of the enactment of this Act, is 
                a savings association; and
                    (B) becomes a bank before January 1, 1998, or, 
                pursuant to the amendments made by this subsection, is 
                treated as a bank as of such date under the Federal 
                Deposit Insurance Act,
        and any depository institution or bank holding company which 
        acquires such depository institution, may continue, after the 
        depository institution becomes or commences to be treated as a 
        bank, to operate any branch which the savings association 
        operated as a branch on September 13, 1995.
            (2) No additional branches.--Paragraph (1) shall not be 
        construed as authorizing the establishment, acquisition, or 
        operation of any additional branch of a depository institution 
        in any State by virtue of the operation by such institution of 
        a branch in such State pursuant to such paragraph except to the 
        extent such establishment, acquisition, or operation is 
        permitted under the Federal Deposit Insurance Act, Bank Holding 
        Company Act of 1956, and any other applicable Federal or State 
        law without regard to such branch.
    (d) Transition Provision Relating to Limitations on Loans to 1 
Borrower.--Section 5200 of the Revised Statutes of the United States 
(12 U.S.C. 84) is amended by adding at the end the following new 
subsection:
    ``(e) Transition Provision for Savings Associations Converting to 
National Banks.--In the case of any depository institution which, as of 
September 13, 1995, is a savings association (as defined in section 
3(b) of the Federal Deposit Insurance Act (as in effect on such date)) 
and becomes a national bank on or before January 1, 1998, any loan, or 
legally binding commitment to make a loan, made or entered into by such 
institution which is outstanding on the date the institution becomes a 
national bank may continue to be held without regard to any limitation 
contained in this section during the 3-year period beginning on such 
date.''.

SEC. 2226. TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Amendments to the Federal Deposit Insurance Act.--
            (1) Section 3(z) of the Federal Deposit Insurance Act (12 
        U.S.C. 1813(z)) is amended by striking ``the Director of the 
        Office of Thrift Supervision,''.
            (2) Section 8(b) of the Federal Deposit Insurance Act (12 
        U.S.C. 1818(b)) is amended by striking paragraph (9).
            (3) Section 13 of the Federal Deposit Insurance Act (12 
        U.S.C. 1823) is amended by striking subsection (k).
            (4) Subsections (c)(2) and (i)(2) of section 18 of the 
        Federal Deposit Insurance Act (12 U.S.C. 1828) are each 
        amended--
                    (A) in subparagraph (B), by inserting ``and'' after 
                the semicolon;
                    (B) in subparagraph (C), by striking ``; and'' and 
                inserting a period; and
                    (C) by striking subparagraph (D).
            (5) Section 18 of the Federal Deposit Insurance Act (12 
        U.S.C. 1828) is amended by striking subsection (m).
            (6) The Federal Deposit Insurance Act (12 U.S.C. 1811 et 
        seq.) is amended by striking section 28.
    (b) Amendments to the Bank Holding Company Act of 1956.--
            (1) Section 2 of the Bank Holding Company Act of 1956 (12 
        U.S.C. 1841) is amended by striking subsections (i) and (j).
            (2) Section 4(c)(8) of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1843(c)(8)) is amended by striking the sentence 
        preceding the penultimate sentence.
            (3) Section 4(f) of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1843(f)) is amended--
                    (A) in paragraph (2)(A)(i), by striking ``or an 
                insured institution'' and all that follows through ``of 
                this subsection)'';
                    (B) in paragraph (2)(A)(ii)--
                            (i) by striking ``or a savings 
                        association'' where such term appears in the 
                        portion of such paragraph which precedes 
                        subclause (I);
                            (ii) by inserting ``and'' at the end of 
                        subclause (VI);
                            (iii) by striking subclauses (VIII), (IX), 
                        and (X); and
                            (iv) by striking ``(V), and (VIII)'', where 
                        such term appears in the portion of such 
                        paragraph which appears after the end of 
                        subclause (VII), and inserting ``and (V)''; and
                    (C) by striking paragraphs (10), (11), (12), and 
                (13).
            (4) Section 4(i) of the Bank Holding Company Act of 1956 
        (12 U.S.C. 1843(i)) is amended--
                    (A) by striking paragraphs (1) and (2); and
                    (B) in paragraph (3)(A), by striking ``any Federal 
                savings association'' and all that follows through the 
                period at the end of such paragraph and inserting 
                ``such association was authorized to engage under this 
                section as of September 15, 1995.''.
    (c) Other Technical and Conforming Amendments.--
            (1) Section 804(a) of the Alternative Mortgage Transaction 
        Parity Act of 1982 (12 U.S.C. 3803) is amended--
                    (A) in the portion of such subsection which 
                precedes paragraph (1)--
                            (i) by striking ``, and other nonfederally 
                        chartered housing creditors,''; and
                            (ii) by inserting ``and in order to permit 
                        other nonfederally chartered housing creditors 
                        to make, purchase, and enforce alternative 
                        mortgage transactions,'' after ``enforcing 
                        alternative mortgage transactions, ''; and
                    (B) in paragraph (1), by inserting ``(as such term 
                is defined in section 3(a) of the Federal Deposit 
                Insurance Act)'' after ``with respect to banks''.
            (2) Section 205 of the Depository Institution Management 
        Interlocks Act (12 U.S.C. 3204) is amended--
                    (A) in the portion of paragraph (8)(A) which 
                precedes clause (i), by striking ``A diversified 
                savings'' and all that follows through ``with respect 
                to'' and inserting ``A depository institution holding 
                company which, as of September 13, 1995, and at all 
                times thereafter, is a diversified savings and loan 
                holding company (as defined in section 10(1)(F) of Home 
                Owners' Loan Act, as such section is in effect on such 
                date) with respect to''; and
                    (B) by striking paragraph (9).
            (3) Section 19(b)(1)(A) of the Federal Reserve Act (12 
        U.S.C. 461(b)(1)(A)) is amended--
                    (A) by inserting ``and'' after the semicolon at the 
                end of clause (v); and
                    (B) by striking clause (vi).
            (4) Subparagraphs (A), (B), (C) of section 10(e)(5) of the 
        Federal Home Loan Bank Act (12 U.S.C. 1430(e)(5)) are each 
        amended by inserting before the period at the end ``(as such 
        section is in effect on September 13, 1995)''.

SEC. 2227. REFERENCES TO SAVINGS ASSOCIATIONS AND STATE BANKS IN 
                    FEDERAL LAW.

    Effective January 1, 1998, any reference in any Federal banking law 
to--
            (1) the term ``savings association'' shall be deemed to be 
        a reference to a bank as defined in section 3(a) of the Federal 
        Deposit Insurance Act; and
            (2) the term ``State bank'' shall be deemed to include any 
        depository institution included in the definition of such term 
        in section 3(a)(2) of such Act.

SEC. 2228. REPEAL OF HOME OWNERS' LOAN ACT.

    Effective January 1, 1998, the Home Owners' Loan Act (12 U.S.C. 
1461 et seq.) is hereby repealed.

SEC. 2229. EFFECTIVE DATE; DEFINITIONS.

    (a) Effective Date of Amendments.--The amendments made by this 
chapter shall take effect on January 1, 1998.
    (b) Definitions.--For purposes of this chapter, the terms 
``appropriate Federal banking agency'', ``bank holding company'', 
``depository institution'', ``Federal savings association'', ``insured 
depository institution'', ``savings association'', and ``State bank'' 
have the same meanings as in section 3 of the Federal Deposit Insurance 
Act (as in effect on the date of the enactment of this Act).

       CHAPTER 3--TRANSFER OF FUNCTIONS, PERSONNEL, AND PROPERTY

SEC. 2241. OFFICE OF THRIFT SUPERVISION ABOLISHED.

    Effective January 1, 1998, the Office of Thrift Supervision and the 
position of Director of the Office of Thrift Supervision are hereby 
abolished.

SEC. 2242. DETERMINATION OF TRANSFERRED FUNCTIONS AND EMPLOYEES.

    (a) All Office of Thrift Supervision Employees Shall Be 
Transferred.--All employees of the Office of Thrift Supervision shall 
be identified for transfer under subsection (b) to the Office of the 
Comptroller of the Currency, the Federal Deposit Insurance Corporation, 
or the Board of Governors of the Federal Reserve System.
    (b) Functions and Employees Transferred.--
            (1) In general.--The Director of the Office of Thrift 
        Supervision, the Comptroller of the Currency, the Chairperson 
        of the Federal Deposit Insurance Corporation, and the Chairman 
        of the Board of Governors of the Federal Reserve System shall 
        jointly determine the functions or activities of the Office of 
        Thrift Supervision, and the number of employees of such Office 
        necessary to perform or support such functions or activities, 
        which are transferred from the Office to the Office of the 
        Comptroller of the Currency, the Federal Deposit Insurance 
        Corporation, or the Board of Governors of the Federal Reserve 
        System, as the case may be.
            (2) Allocation of employees.--The Comptroller of the 
        Currency, the Chairperson of the Federal Deposit Insurance 
        Corporation, and the Chairman of the Board of Governors of the 
        Federal Reserve System shall allocate the employees of the 
        Office of Thrift Supervision consistent with the number 
        determined pursuant to paragraph (1) in a manner which such 
        Comptroller, Chairperson, and Chairman, in their sole 
        discretion, deem equitable, except that, within work units, the 
        agency preferences of individual employees shall be 
        accommodated as far as possible.
    (c) Disposition of Affairs.--
            (1) In general.--In winding up the affairs of the Office of 
        Thrift Supervision, the Director of the Office of Thrift 
        Supervision shall consult and cooperate with the Comptroller of 
        the Currency, the Federal Deposit Insurance Corporation, and 
        the Board of Governors of the Federal Reserve System, as the 
        case may be, to facilitate the orderly transfer of the 
        functions to such Comptroller, Corporation, or Board.
            (2) Continuing authority of director of the office of 
        thrift supervision.--Except as provided in paragraph (1), no 
        provision of this subtitle shall be construed as affecting the 
        authority vested in the Director of the Office of Thrift 
        Supervision before the date of enactment of this Act which is 
        necessary to carry out the duties of the position until the 
        date upon which the position of Director of the Office of 
        Thrift Supervision is abolished.
            (3) Continuation of agency services.--Any agency, 
        department, or other instrumentality of the United States, or 
        any successor to any such agency, department, or 
        instrumentality, which was providing support services to the 
        Director of the Office of Thrift Supervision on the day before 
        the date such position is abolished shall--
                    (A) continue to provide such services on a 
                reimbursable basis, in accordance with the terms of the 
                arrangement pursuant to which such services were 
                provided until the arrangement is modified or 
                terminated in accordance with such terms, except that 
                effective January 1, 1998, the Comptroller of the 
                Currency, the Federal Deposit Insurance Corporation, or 
                the Board of Governors of the Federal Reserve System, 
                as the case may be, shall be substituted for the 
                Director of the Office of Thrift Supervision as a party 
                to the arrangement; and
                    (B) consult with the Comptroller, the Corporation, 
                or the Board to coordinate and facilitate a prompt and 
                reasonable transition.
    (d) Transfer of Property.--Effective January 1, 1998, all property 
of the Office of Thrift Supervision shall be transferred to the 
Comptroller of the Currency, the Federal Deposit Insurance Corporation, 
or the Board of Governors of the Federal Reserve System, as determined 
in accordance with subsections (a) and (b).

SEC. 2243. SAVINGS PROVISIONS.

    (a) Existing Rights, Duties, and Obligations Not Affected.--No 
provision of this title shall be construed as affecting the validity of 
any right, duty, or obligation of the United States, the Director of 
the Office of Thrift Supervision, or any person, which existed on the 
day before the date upon which the position of Director of the Office 
of Thrift Supervision and the Office of Thrift Supervision are 
abolished.
    (b) Continuation of Suits.--No action or other proceeding commenced 
by or against the Director of the Office of Thrift Supervision shall 
abate by reason of enactment of this Act, except that, effective 
January 1, 1998, the Comptroller of the Currency, the Federal Deposit 
Insurance Corporation, or the Board of Governors of the Federal Reserve 
System, as the case may be, shall be substituted as a party to any such 
action or proceeding.
    (c) Continuation of Administrative Rules.--All orders, resolutions, 
determinations, regulations, interpretative rules, other 
interpretations, guidelines, procedures, supervisory and enforcement 
actions, and other advisory material (other than any regulation 
implementing or prescribed pursuant to section 3(f) of the Home Owners' 
Loan Act (as in effect on September 13, 1995)) which--
            (1) have been issued, made, prescribed, or permitted to 
        become effective by the Office of Thrift Supervision, and
            (2) are in effect on December 31, 1996, (or become 
        effective after such date pursuant to the terms of the order, 
        resolution, determination, rule, other interpretation, 
        guideline, procedure, supervisory or enforcement action, and 
        other advisory material, as in effect on such date), shall--
                    (A) continue in effect according to the terms of 
                such orders, resolutions, determinations, regulations, 
                interpretative rules, other interpretations, 
                guidelines, procedures, supervisory or enforcement 
                actions, or other advisory material;
                    (B) be administered by the Comptroller of the 
                Currency, the Federal Deposit Insurance Corporation, or 
                the Board of Governors of the Federal Reserve System; 
                and
                    (C) be enforceable by or against the Comptroller of 
                the Currency, the Federal Deposit Insurance 
                Corporation, or the Board of Governors of the Federal 
                Reserve System until modified, terminated, set aside, 
                or superseded in accordance with applicable law by the 
                Comptroller, Corporation, or Board, by any court of 
                competent jurisdiction, or by operation of law.
    (d) Treatment of References in Adjustable Rate Mortgages Issued 
Before FIRREA.--For purposes of section 402(e) of Financial 
Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C. 
1437 note), any reference in such section to--
                    (A) the Director of the Office of Thrift 
                Supervision shall be deemed to be a reference to the 
                Secretary of the Treasury; and
                    (B) a Savings Association Insurance Fund member 
                shall be deemed to be a reference to an insured 
                depository institution (as defined in section 3 of the 
                Federal Deposit Insurance Act).
    (e) Treatment of References in Adjustable Rate Mortgage Instruments 
Issued After FIRREA.--
            (1) In general.--For purposes of adjustable rate mortgage 
        instruments that are in effect as of the date of enactment of 
        this Act, any reference in the instrument to the Director of 
        the Office of Thrift Supervision or Savings Association 
        Insurance Fund members shall be treated as a reference to the 
        Secretary of the Treasury or insured depository institutions 
        (as defined in section 3 of the Federal Deposit Insurance Act), 
        as appropriate.
            (2) Substitution for indexes.--If any index used to 
        calculate the applicable interest rate on any adjustable rate 
        mortgage instrument is no longer calculated and made available 
        as a direct or indirect result of the enactment of this Act, 
        any index--
                    (A) made available by the Secretary of the 
                Treasury; or
                    (B) determined by the Secretary of the Treasury, 
                pursuant to paragraph (4), to be substantially similar 
                to the index which is no longer calculated or made 
                available,
        may be substituted by the holder of any such adjustable rate 
        mortgage instrument upon notice to the borrower.
            (3) Agency action required to provide continued 
        availability of indexes.--Promptly after the enactment of this 
        subsection, the Secretary of the Treasury, the Chairperson of 
        the Federal Deposit Insurance Corporation, and the Comptroller 
        of the Currency shall take such action as may be necessary to 
        assure that the indexes prepared by the Director of the Office 
        of Thrift Supervision immediately prior to the enactment of 
        this subsection and used to calculate the interest rate on 
        adjustable rate mortgage instruments continue to be available.
            (4) Requirements relating to substitute indexes.--If any 
        agency can no longer make available an index pursuant to 
        paragraph (3), an index that is substantially similar to such 
        index may be substituted for such index for purposes of 
        paragraph (2) if the Secretary of the Treasury determines, 
        after notice and opportunity for comment, that--
                    (A) the new index is based upon data substantially 
                similar to that of the original index; and
                    (B) the substitution of the new index will result 
                in an interest rate substantially similar to the rate 
                in effect at the time the original index became 
                unavailable.

SEC. 2244. REFERENCES IN FEDERAL LAW TO DIRECTOR OF THE OFFICE OF 
                    THRIFT SUPERVISION.

    Any reference in any Federal law to the Director of the Office of 
Thrift Supervision or the Office of Thrift Supervision shall be deemed 
to be a reference to the appropriate Federal banking agency (as defined 
in section 3(q) of the Federal Deposit Insurance Act).

SEC. 2245. RECONFIGURATION OF BOARD OF DIRECTORS OF FDIC AS A RESULT OF 
                    REMOVAL OF DIRECTOR OF THE OFFICE OF THRIFT 
                    SUPERVISION.

    (a) In General.--Section 2(a)(1) of the Federal Deposit Insurance 
Act (12 U.S.C. 1812(a)(1)) is amended to read as follows:
            ``(1) In general.--The management of the Corporation shall 
        be vested in a Board of Directors consisting of 3 members--
                    ``(A) 1 of whom shall be the Comptroller of the 
                Currency; and
                    ``(B) 2 of whom shall be appointed by the 
                President, by and with the advice and consent of the 
                Senate, from among individuals who are citizens of the 
                United States.''.
    (b) Technical and Conforming Amendments.--
            (1) Section 2(a)(2) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1812(a)(2)) is amended--
                    (A) by striking ``February 28, 1993'' and inserting 
                ``January 1, 1998''; and
                    (B) by striking ``3'' and inserting ``2''.
            (2) Section 2(d)(2) of the Federal Deposit Insurance Act 
        (12 U.S.C. 1812(d)(2)) is amended--
                    (A) by striking ``or the office of Director of the 
                Office of Thrift Supervision'';
                    (B) by striking ``or such Director'';
                    (C) by striking ``or the Acting Director of the 
                Office of Thrift Supervision, as the case may be''; and
                    (D) by striking ``or Director''.
    (c) Effective Date.--The amendments made by subsections (a) and (b) 
shall take effect on January 1, 1998.
    (d) Designation of Abolished Position.--Unless there is a vacancy 
in the position of an appointed member of the Board of Directors as of 
January 1, 1998, the President, consistent with the requirements of 
section 2(a)(2) of the Federal Deposit Insurance Act, shall designate 
which of the 3 positions of appointed member of such Board of Directors 
shall be abolished pursuant to the amendment made by subsection (a).

                 CHAPTER 4--LOAN LOSS RESERVE TREATMENT

SEC. 2261. SENSE OF THE CONGRESS.

    It is the sense of the Congress that--
            (1) one of the major obstacles to the conversion of thrift 
        institutions into banks is the tax treatment of bad debt 
        reserve deductions of thrift institutions;
            (2) as part of a comprehensive solution to the merger of 
        the Federal deposit insurance funds and thrift and bank 
        charters, section 593 of the Internal Revenue Code of 1986 
        should be repealed; and
            (3) the repeal of section 593 of the Internal Revenue Code 
        of 1986 should be accomplished in such a fashion as would 
        neither threaten the economic viability of thrift institutions 
        which convert to bank charters nor cause the Federal Treasury 
        to lose revenue.

           Subtitle C--Community Reinvestment Act Amendments

SEC. 2301. EXPRESSION OF CONGRESSIONAL INTENT.

    Subsection (b) of section 802 of the Community Reinvestment Act of 
1977 (12 U.S.C. 2901) is amended to read as follows:
    ``(b) It is the purpose of this title to require each appropriate 
Federal financial supervisory agency to use its authority, when 
examining financial institutions, to encourage such institutions to 
help meet the credit needs of the local communities in which they are 
chartered consistent with the safe and sound operation of such 
institutions. When examining financial institutions, a supervisory 
agency shall not impose additional burden, recordkeeping, or reporting 
upon such institutions.''.

SEC. 2302. COMMUNITY REINVESTMENT ACT EXEMPTION.

    The Community Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is 
amended by adding at the end the following new section:

``SEC. 809. TREATMENT OF SMALL FINANCIAL INSTITUTIONS.

    ``(a) In General.--In lieu of being evaluated under section 806A 
and receiving a written evaluation under section 807, an eligible 
regulated financial institution shall make a notice, signed by the 
president, available to the public that--
            ``(1) lists the type of credit and services that the 
        institution provides to help meet the credit needs of the local 
        community; and
            ``(2) states that the institution helps meet the credit 
        needs of the local communities in which the institution 
        operates, including low- and moderate-income neighborhoods.
    ``(b) Eligible regulated financial institutions.--
            ``(1) In general.--A regulated financial institution shall 
        be eligible for purposes of subsection (a) if the institution 
        and any bank holding company which controls such institution 
        have aggregate assets of not more than $100,000,000.
            ``(2) Annual adjustment.--The dollar amount in paragraph 
        (1) shall be adjusted annually after December 31, 1994, by the 
        annual percentage increase in the Consumer Price Index for 
        Urban Wage Earners and Clerical Workers published by the Bureau 
        of Labor Statistics.
    ``(c) Exemption From Other Requirements.--A regulated financial 
institution which has complied with the notice requirements of 
subsection (a) shall not be subject to section 804 and any regulations 
prescribed under section 806.''.

SEC. 2303. SELF-CERTIFICATION OF CRA COMPLIANCE.

    Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2903) is amended by adding at the end the following new subsection (c):
    ``(c) Self-Certification of CRA Compliance.--
            ``(1) Certification.--In lieu of being evaluated under 
        section 806A and receiving a written evaluation under section 
        807, a qualifying financial institution may elect to self-
        certify to the appropriate Federal financial supervisory agency 
        that such institution is in compliance with the goals of this 
        title.
            ``(2) Qualifying institution.--
                    ``(A) In general.--For purposes of paragraph (1), 
                the term `qualifying institution' means a financial 
                institution which--
                            ``(i) has not more than $250 million in 
                        assets;
                            ``(ii) has not been found to have engaged 
                        in a pattern or practice of illegal 
                        discrimination under the Fair Housing Act or 
                        the Equal Credit Opportunity Act for the 
                        preceding 5-year calendar period; and
                            ``(iii) received rating under section 
                        807(b)(2) of `satisfactory' or `outstanding' in 
                        the most recent evaluation of such institution 
                        under this title.
                    ``(B) Annual adjustment.--The dollar amount in 
                subparagraph (A) shall be adjusted annually after 
                December 31, 1994, by the annual percentage increase in 
                the Consumer Price Index for Urban Wage Earners and 
                Clerical Workers published by the Bureau of Labor 
                Statistics.
            ``(3) Public notice.--
                    ``(A) In general.--A qualifying institution shall 
                maintain in every branch a public notice stating that--
                            ``(i) the institution has self-certified 
                        that the institution is satisfactorily helping 
                        to meet the credit needs of its community;
                            ``(ii) the institution maintains--
                                    ``(I) at the main office of such 
                                institution, a public file which 
                                contains a copy of the self-
                                certification to the appropriate 
                                Federal financial supervisory agency; 
                                and
                                    ``(II) a map delineating the 
                                community served by the institution;
                            ``(iii) a list of the types of credit and 
                        services that the institution provides to the 
                        community served by the institution;
                            ``(iv) such other information that the 
                        institution believes demonstrates the 
                        institution's record of helping to meet the 
                        credit needs of its community; and
                            ``(v) every public comment or letter to the 
                        institution (and any response by the 
                        institution) received within the previous 2-
                        year period about the record of the institution 
                        of helping to meet the credit needs of its 
                        community.
                    ``(B) Public file.--A qualifying institution shall 
                maintain a public file containing the contents 
                described in this paragraph at the institution's main 
                office.
            ``(4) Rating.--
                    ``(A) In general.--A qualifying institution shall 
                be deemed to have a rating of a `satisfactory record of 
                meeting community credit needs' for the purposes of 
                this section and section 806A(c).
                    ``(B) Publication.--Each Federal financial 
                supervisory agency shall publish in the Federal 
                Register once each month a list of institutions that 
                have self-certified during the previous month.
                    ``(C) Publication constitutes disclosure.--
                Publication of the name of the institution in the 
                Federal Register as having self-certified shall 
                constitute disclosure of the rating of the institution 
                to the public for purposes of sections 806A and 807.
            ``(5) Regulatory review.--
                    ``(A) Assessment.--During each examination for 
                safety and soundness, a qualifying institution's 
                supervisory agency shall, as part of the agency's 
                review of the institution's loans, assess whether the 
                institution's basis for its self-certification is 
                reasonable based on the public notice and the 
                information contained in the public file pursuant to 
                paragraph (3).
                    ``(B) Examination if self-certification is not 
                reasonable.--If the agency determines that the 
                institution's basis for the institution's self-
                certification is not reasonable, the agency shall 
                schedule an examination of the institution for the 
                purpose of assessing the institution's record of 
                helping to meet the credit needs of its community.
                    ``(C) Revocation of self-certification.--If an 
                assessment pursuant to subparagraph (B) results in a 
                less than `satisfactory' rating, the agency shall 
                revoke the institution's self-certification and 
                substitute a written evaluation as provided under 
                section 807.
                    ``(D) Period of ineligibility for self-
                certification.--An institution whose self-certification 
                has been revoked may not self-certify pursuant to this 
                subsection during the 5 years succeeding the year in 
                which the self-certification is revoked.
                    ``(E) Subsequent eligibility.--After the end of the 
                period of ineligibility described in subparagraph (D), 
                an institution which meets the requirements for self-
                certification may elect to self-certify.
            ``(6) Prohibition on additional requirements.--No 
        appropriate Federal financial supervisory agency may impose any 
        additional requirements, whether by regulation or otherwise, 
        relating to the self-certification procedure under this 
        subsection.''.

SEC. 2304. COMMUNITY INPUT AND CONCLUSIVE RATING.

    (a) Conforming Amendment.--Section 804(a) of the Community 
Reinvestment Act of 1977 (12 U.S.C. 2903) is amended by inserting 
``conducted in accordance with section 806A,'' after ``financial 
institution,''.
    (b) Community Input and Conclusive Rating.--The Community 
Reinvestment Act of 1977 (12 U.S.C. 2901 et seq.) is amended by 
inserting after section 806 the following new section:

``SEC. 806A. COMMUNITY INPUT AND CONCLUSIVE RATING.

    ``(a) Publication of Exam Schedule and Opportunity for Comment.--
            ``(1) Publication of notice.--Each appropriate Federal 
        financial supervisory agency shall--
                    ``(A) publish in the Federal Register, 30 days 
                before the beginning of a calendar quarter, a listing 
                of institutions scheduled for evaluation for compliance 
                with this title during such calendar quarter; and
                    ``(B) provide opportunity for written comments from 
                the community on the performance, under this title, of 
                each institution scheduled for evaluation.
            ``(2) Comment period.--Written comments may not be 
        submitted to an appropriate Federal financial supervisory 
        agency pursuant to paragraph (1) after the end of the 30-day 
        period beginning on the first day of the calendar quarter.
            ``(3) Copy of comments.--The agency shall provide a copy of 
        such comments to the institution.
    ``(b) Evaluation.--The appropriate Federal financial supervisory 
agency shall--
            ``(1) evaluate the institution in accordance with the 
        standards contained in section 804; and
            ``(2) prepare and publish a written evaluation of the 
        institution as required under section 807.
    ``(c) Reconsideration of Rating.--
            ``(1) Request for reconsideration.--A reconsideration of an 
        institution's rating referred to in section 807(b)(1)(C), may 
        be requested within 30 days of the rating's disclosure to the 
        public.
            ``(2) Procedures for request.--Any such request shall be 
        made in writing and filed with the appropriate Federal 
        financial supervisory agency, and may be filed by the 
        institution or a member of the community.
            ``(3) Basis for request.--Any request for reconsideration 
        under this subsection shall be based on significant issues of a 
        substantive nature which are relevant to the delineated 
        community of the institution and, in the case of a request by a 
        member of the community, shall be limited to issues previously 
        raised in comments submitted pursuant to subsection (a).
            ``(4) Completion of review.--The appropriate Federal 
        financial supervisory agency shall complete any requested 
        reconsideration within 30 days of the filing of the request.
    ``(d) Conclusive Rating.--
            ``(1) In general.--An institution's rating shall become 
        conclusive on the later of--
                    ``(A) 30 days after the rating is disclosed to the 
                public; or
                    ``(B) the completion of any requested 
                reconsideration by the Federal financial supervisory 
                agency.
            ``(2) Rating conclusive of meeting community credit 
        needs.--An institution's rating shall be the conclusive 
        assessment of the institution's record of meeting the credit 
        needs of its community for purposes of section 804 until the 
        institution's next rating, developed pursuant to an 
        examination, becomes conclusive.
            ``(3) Safe harbor.--Institutions which have received a 
        `satisfactory' or `outstanding' rating shall be deemed to have 
        met the purposes of section 804.
            ``(4) Rule of construction.--Notwithstanding any other 
        provision of law, no provision of this section shall be 
        construed as granting a cause of action to any person.''.
    (c) Overall Evaluation of Institution.--Paragraph (2) of section 
804(a) of the Community Reinvestment Act of 1977 (12 U.S.C. 2903(a)) is 
amended to read as follows:
            ``(2) take such record into account in the overall 
        evaluation of the condition of the institution by the 
        appropriate Federal financial supervisory agency.''.

SEC. 2305. SPECIAL PURPOSE FINANCIAL INSTITUTIONS.

    (a) In General.--Section 804 of the Community Reinvestment Act of 
1977 (12 U.S.C. 2903) is amended by inserting after subsection (c) (as 
added by section 2303 of this subtitle) the following new subsection:
    ``(d) Special Purpose Institutions.--
            ``(1) In general.--In conducting assessments pursuant to 
        this section at any special purpose institution, the 
        appropriate Federal financial supervisory agency shall--
                    ``(A) consider the nature of business such 
                institution is involved in; and
                    ``(B) assess and take into account the record of 
                the institution commensurate with the amount of 
                deposits (as defined in section 3(1) of the Federal 
                Deposit Insurance Act) received by such institution.
            ``(2) Standards.--Each appropriate Federal financial 
        supervisory agency shall develop standards under which special 
        purpose institutions may be deemed to have complied with the 
        requirements of this title which are consistent with the 
        specific nature of such businesses.''.
    (b) Special Purpose Institution Defined.--Section 803 of the 
Community Reinvestment Act of 1977 (12 U.S.C. 2902) is amended by 
adding at the end the following new paragraph:
            ``(5) Special purpose institutions.--The term `special 
        purpose institution' means a financial institution that does 
        not generally accept deposits from the public in amounts of 
        less than $100,000, such as wholesale, credit card, and trust 
        institutions.''.

SEC. 2306. INCREASED INCENTIVES FOR LENDING TO LOW- AND MODERATE-INCOME 
                    COMMUNITIES.

    (a) In General.--Section 804(b) of the Community Reinvestment Act 
of 1977 (12 U.S.C. 2903(b)) is amended to read as follows:
    ``(b) Positive Consideration of Certain Loans and Investments.--In 
assessing and taking into account the records of a regulated financial 
institution under subsection (a), the appropriate Federal financial 
supervisory agency shall--
            ``(1) consider as a positive factor, consistent with the 
        safe and sound operation of the institution, the institution's 
        investment in or loan to--
                    ``(A) any minority depository institution or 
                women's depository institution (as such terms are 
                defined in section 808(b)) or any low-income credit 
                union;
                    ``(B) any joint venture or other entity or project 
                which promotes the public welfare in any distressed 
                community (as defined by such agency) whether or not 
                the distressed community is located in the local 
                community in which the regulated financial institution 
                is chartered to do business; and
                    ``(C) targeted low- and moderate-income 
                communities, including real property loans to such 
                communities; and
            ``(2) consider equally with other factors capital 
        investment, loan participation, and other ventures undertaken 
        by the institution in cooperation with--
                    ``(A) minority- and women-owned financial 
                institutions and low-income credit unions to the extent 
                that these activities help meet the credit needs of the 
                local communities in which such institutions are 
                chartered; and
                    ``(B) community development corporations in 
                extending credit and other financial services 
                principally to low- and moderate-income persons and 
                small businesses to the extent that such community 
                development corporations help meet the credit needs of 
                the local communities served by the majority-owned 
                institution.''.
    (b) Amendment to Definitions.--Section 803 of the Community 
Reinvestment Act of 1977 (12 U.S.C. 2902) is amended by inserting after 
paragraph (5) (as added by section 2305(b) of this subtitle) the 
following new paragraph:
            ``(6) State bank supervisor.--The term `State bank 
        supervisor' has the same meaning as in section 3(r) of the 
        Federal Deposit Insurance Act.''.
    (c) Technical Correction.--The 1st of the 2 paragraphs designated 
as paragraph (2) of section 803 of the Community Reinvestment Act of 
1977 (12 U.S.C. 2902) is amended to read as follows:
                    ``(D) the Director of the Office of Thrift 
                Supervision with respect to any savings association 
                (the deposits of which are insured by the Federal 
                Deposit Insurance Corporation) and any savings and loan 
                holding company (other than a company which is a bank 
                holding company);''.

SEC. 2307. PROHIBITION ON ADDITIONAL REPORTING UNDER CRA.

    Section 806 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2905) is amended to read as follows:

``SEC. 806. REGULATIONS.

    ``(a) In General.--
            ``(1) Publication requirement.--Regulations to carry out 
        the purposes of this title shall be published by each 
        appropriate Federal financial supervisory agency.
            ``(2) Prohibition on additional recordkeeping.--Regulations 
        prescribed and policy statements, commentary, examiner 
        guidance, or other supervisory material issued under this title 
        shall not impose any additional recordkeeping on a financial 
        institution.
            ``(3) Prohibition on loan data collection.--No loan data 
        may be required to be collected and reported by a financial 
        institution and no such data may be made public by any Federal 
        financial supervisory agency under this title.''.

SEC. 2308. TECHNICAL AMENDMENT.

    Section 807(b)(1)(B) of the Community Reinvestment Act (12 U.S.C. 
2906) is amended by striking ``The information'' and inserting ``In the 
case of a regulated financial institution that maintains domestic 
branches in 2 or more States, the information''.

SEC. 2309. DUPLICATIVE REPORTING.

    Section 10(g) of the Federal Home Loan Bank Act (12 U.S.C. 1430(g)) 
is amended by adding at the end the following new paragraph (3):
            ``(3) Special rule.--This subsection shall not apply to 
        members receiving a grade of `outstanding' or `satisfactory' 
        under section 807 of the Community Reinvestment Act of 1977.''.

SEC. 2310. CRA CONGRESSIONAL OVERSIGHT.

    (a) Sense of Congress Relating to Aggressive Oversight.--It is the 
sense of the Congress that the appropriate committees of the House of 
Representatives and the Senate should exercise aggressive oversight of 
the adoption and implementation of any regulation by any appropriate 
Federal financial supervisory agency under the Community Reinvestment 
Act of 1977 after the date of the enactment of this Act.
    (b) Agency Reports Required.--
            (1) In general.--Each appropriate Federal financial 
        supervisory agency shall submit a report to the Congress by 
        December 31, 1996, and by December 31, 1997, on the 
        implementation of all regulations prescribed by such agency 
        under the Community Reinvestment Act of 1977 after the date of 
        the enactment of this Act.
            (2) Requirements relating to preparation of reports.--In 
        preparing each report required under paragraph (1), each 
        appropriate Federal financial supervisory agency shall--
                    (A) solicit and include comments from regulated 
                financial institutions with respect to the regulations 
                which are the subject of the report; and
                    (B) include quantifiable measures of the cost 
                savings achieved under the regulations which are the 
                subject of the report and the effectiveness of such 
                regulations in achieving the purposes of the Community 
                Reinvestment Act of 1977.
            (3) Definitions.--For purposes of this section, the terms 
        ``appropriate Federal financial supervisory agency'' and 
        ``regulated financial institution'' have the same meanings as 
        in section 803 of the Community Reinvestment Act of 1977.

SEC. 2311. CONSULTATION AMONG EXAMINERS.

    Section 10 of the Federal Deposit Insurance Act (12 U.S.C. 1820) is 
amended by adding at the end the following new subsection:
    ``(j) Consultation Among Examiners.--
            ``(1) In general.--Each appropriate Federal banking agency 
        shall take such action as may be necessary to ensure that 
        examiners employed by the agency--
                    ``(A) consult on examination activities with 
                respect to any depository institution; and
                    ``(B) achieve an agreement and resolve any 
                inconsistencies on the recommendations to be given to 
                such institution as a consequence of any examinations.
            ``(2) Examiner-in-charge.--Each agency shall consider 
        appointing an examiner-in-charge with respect to a depository 
        institution to ensure consultation on examination activities 
        among all of the agency's examiners involved in examinations of 
        such institution.''.

SEC. 2312. LIMITATION ON REGULATIONS.

    Section 806 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2905) (as amended by section 2307) is amended by adding at the end the 
following new subsections:
    ``(b) Limitation on Regulations.--No regulation may be prescribed 
under this title by any Federal agency which would--
            ``(1) require any regulated financial institution to--
                    ``(A) make any loan or enter into any other 
                agreement on the basis of any discriminatory criteria 
                prohibited under any law of the United States; or
                    ``(B) make any loan to, or enter into any other 
                agreement with, any uncreditworthy person that would 
                jeopardize the safety and soundness of such 
                institution; or
            ``(2) prevent or hinder in any way a financial 
        institution's full responsibility to provide credit to all 
        segments of the community.
    ``(c) Encourage Loans to Creditworthy Borrowers.--Regulations 
prescribed under this title shall encourage regulated financial 
institutions to make loans and extend credit to all creditworthy 
persons, consistent with safety and soundness.''.

                    TITLE III--COMMITTEE ON COMMERCE

                       Subtitle A--Communications

                      CHAPTER 1--SPECTRUM AUCTIONS

SEC. 3001. SPECTRUM AUCTIONS.

    (a) Extension and Expansion of Auction Authority.--
            (1) Amendments.--Section 309(j) of the Communications Act 
        of 1934 (47 U.S.C. 309(j)) is amended--
                    (A) by striking paragraphs (1) and (2) and 
                inserting in lieu thereof the following:
            ``(1) General authority.--If, consistent with the 
        obligations described in paragraph (6)(E), mutually exclusive 
        applications are accepted for any initial license or 
        construction permit which will involve an exclusive use of the 
        electromagnetic spectrum, then the Commission shall grant such 
        license or permit to a qualified applicant through a system of 
        competitive bidding that meets the requirements of this 
        subsection.
            ``(2) Exemptions.--The competitive bidding authority 
        granted by this subsection shall not apply to licenses or 
        construction permits issued by the Commission--
                    ``(A) that, as the result of the Commission 
                carrying out the obligations described in paragraph 
                (6)(E), are not mutually exclusive;
                    ``(B) for public safety radio services, including 
                non-Government uses that protect the safety of life, 
                health, and property and that are not made commercially 
                available to the public; or
                    ``(C) for initial licenses or construction permits 
                for new terrestrial digital television services 
                assigned by the Commission to existing terrestrial 
                broadcast licensees to replace their current television 
                licenses.''; and
                    (B) by striking ``1998'' in paragraph (11) and 
                inserting ``2002''.
            (2) Conforming amendment.--Subsection (i) of section 309 of 
        such Act is repealed.
            (3) Effective date.--The amendment made by paragraph (1)(A) 
        shall not apply with respect to any license or permit for which 
        the Federal Communications Commission has accepted mutually 
        exclusive applications on or before the date of enactment of 
        this Act.
    (b) Commission Obligation To Make Additional Spectrum Available by 
Auction.--
            (1) In general.--The Federal Communications Commission 
        shall complete all actions necessary to permit the assignment, 
        by September 30, 2002, by competitive bidding pursuant to 
        section 309(j) of the Communications Act of 1934 (47 U.S.C. 
        309(j)) of licenses for the use of bands of frequencies that--
                    (A) individually span not less than 25 megahertz, 
                unless a combination of smaller bands can, 
                notwithstanding the provisions of paragraph (7) of such 
                section, reasonably be expected to produce greater 
                receipts;
                    (B) in the aggregate span not less than 100 
                megahertz;
                    (C) are located below 3 gigahertz; and
                    (D) have not, as of the date of enactment of this 
                Act--
                            (i) been designated by Commission 
                        regulation for assignment pursuant to such 
                        section; or
                            (ii) been identified by the Secretary of 
                        Commerce pursuant to section 113 of the 
                        National Telecommunications and Information 
                        Administration Organization Act.
                The Commission shall conduct the competitive bidding 
                for not less than one-half of such aggregate spectrum 
                by September 30, 2000.
            (2) Criteria for reassignment.--In making available bands 
        of frequencies for competitive bidding pursuant to paragraph 
        (1), the Commission shall--
                    (A) seek to promote the most efficient use of the 
                spectrum;
                    (B) take into account the cost to incumbent 
                licensees of relocating existing uses to other bands of 
                frequencies or other means of communication;
                    (C) take into account the needs of public safety 
                radio services; and
                    (D) comply with the requirements of international 
                agreements concerning spectrum allocations.
            (3) Notification to ntia.--The Commission shall notify the 
        Secretary of Commerce if--
                    (A) the Commission is not able to provide for the 
                effective relocation of incumbent licensees to bands of 
                frequencies that are available to the Commission for 
                assignment; and
                    (B) the Commission has identified bands of 
                frequencies that are--
                            (i) suitable for the relocation of such 
                        licensees; and
                            (ii) allocated for Federal Government use, 
                        but that could be reallocated pursuant to part 
                        B of the National Telecommunications and 
                        Information Administration Organization Act (as 
                        amended by this Act).
    (c) Identification and Reallocation of Frequencies.--The National 
Telecommunications and Information Administration Organization Act (47 
U.S.C. 901 et seq.) is amended--
            (1) in section 113, by adding at the end the following new 
        subsection:
    ``(f) Additional Reallocation Report.--If the Secretary receives a 
notice from the Commission pursuant to section 3001(b)(3) of the Seven-
Year Balanced Budget Reconciliation Act of 1995, the Secretary shall 
prepare and submit to the President and the Congress a report 
recommending for reallocation for use other than by Federal Government 
stations under section 305 of the 1934 Act (47 U.S.C. 305), bands of 
frequencies that are suitable for the uses identified in the 
Commission's notice.'';
            (2) in section 114(a)(1), by striking ``(a) or (d)(1)'' and 
        inserting ``(a), (d)(1), or (f)''.
    (d) Completion of C-Block PCS Auction.--The Federal Communications 
Commission shall commence the Broadband Personal Communications 
Services C-Block auction described in the Commission's Sixth Report and 
Order in DP Docket 93-253 (FCC 93-510, released July 18, 1995) not 
later than December 4, 1995. The Commission's competitive bidding rules 
governing such auction, as set forth in such Sixth Report and Order, 
are hereby ratified and adopted as a matter of Federal law.
    (e) Modification of Auction Policy To Preserve Auction Value of 
Spectrum.--The voluntary negotiation period for relocating fixed 
microwave licensees to frequency bands other than those allocated for 
licensed emerging technology services (including licensed personal 
communications services), established by the Commission's Third Report 
and Order in ET Docket No. 92-9, shall expire one year after the date 
of acceptance by the Commission of applications for such licensed 
emerging technology services. The mandatory negotiation period for 
relocating fixed microwave licensees to frequency bands other than 
those allocated for licensed emerging technology services (including 
licensed personal communications services), established in such Third 
Report and Order, shall expire two years after the date of acceptance 
by the Commission of applications for such licensed emerging technology 
services.
    (f) Identification and Reallocation of Auctionable Frequencies.--
The National Telecommunications and Information Administration 
Organization Act (47 U.S.C. 901 et seq.) is amended--
            (1) in section 113(b)--
                    (A) by striking the heading of paragraph (1) and 
                inserting ``Initial reallocation report'';
                    (B) by inserting ``in the first report required by 
                subsection (a)'' after ``recommend for reallocation'' 
                in paragraph (1);
                    (C) by inserting ``or (3)'' after ``paragraph (1)'' 
                each place it appears in paragraph (2); and
                    (D) by inserting after paragraph (2) the following 
                new paragraph:
            ``(3) Second reallocation report.--In accordance with the 
        provisions of this section, the Secretary shall recommend for 
        reallocation in the second report required by subsection (a), 
        for use other than by Federal Government stations under section 
        305 of the 1934 Act (47 U.S.C. 305), a single frequency band 
        that spans not less than an additional 20 megahertz, that is 
        located below 3 gigahertz, and that meets the criteria 
        specified in paragraphs (1) through (5) of subsection (a).''; 
        and
            (2) in section 115--
                    (A) in subsection (b), by striking ``the report 
                required by section 113(a)'' and inserting ``the 
                initial reallocation report required by section 
                113(a)''; and
                    (B) by adding at the end the following new 
                subsection:
    ``(c) Allocation and Assignment of Frequencies Identified in the 
Second Reallocation Report.--With respect to the frequencies made 
available for reallocation pursuant to section 113(b)(3), the 
Commission shall, not later than 1 year after receipt of the second 
reallocation report required by such section, prepare, submit to the 
President and the Congress, and implement, a plan for the allocation 
and assignment under the 1934 Act of such frequencies. Such plan shall 
propose the immediate allocation and assignment of all such frequencies 
in accordance with section 309(j).''.

       CHAPTER 2--FEDERAL COMMUNICATIONS COMMISSION AUTHORIZATION

SEC. 3011. SHORT TITLE.

    This chapter may be cited as the ``Federal Communications 
Commission Authorization Act of 1995''.

SEC. 3012. EXTENSION OF AUTHORITY.

    (a) Authorization of Appropriations.--Section 6 of the 
Communications Act of 1934 (47 U.S.C. 156) is amended to read as 
follows:

``SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

    ``There are authorized to be appropriated for the administration of 
this Act by the Commission $186,000,000 for fiscal year 1996, together 
with such sums as may be necessary for increases resulting from 
adjustments in salary, pay, retirement, other employee benefits 
required by law, and other nondiscretionary costs, for fiscal year 
1996. Of the sum appropriated in each fiscal year under this section, a 
portion, in an amount determined under sections 8(b) and 9(b), shall be 
derived from fees authorized by sections 8 and 9.''.
    (b) Travel and Reimbursement Program.--Section 4(g)(2) of the 
Communications Act of 1934 (47 U.S.C. 154(g)(2)) is amended to read as 
follows:
    ``(2) The Commission shall submit to the appropriate committees of 
Congress, and publish in the Federal Register, semiannual reports 
specifying the reimbursements which the Commission has accepted under 
section 1353 of title 31, United States Code.''.
    (c) Communications Support From Older Americans.--Section 6(a) of 
the Federal Communications Commission Authorization Act of 1988 (47 
U.S.C. 154 note) is amended by striking ``fiscal years 1992 and 1993'' 
and inserting ``fiscal year 1996''.

SEC. 3013. APPLICATION FEES.

    (a) Adjustment of Application Fee Schedule.--Section 8(b) of the 
Communications Act of 1934 (47 U.S.C. 158(b)) is amended to read as 
follows:
    ``(b)(1) For fiscal year 1996 and each fiscal year thereafter, the 
Commission shall, by regulation, modify the application fees by 
proportionate increases or decreases so as to result in estimated total 
collections for the fiscal year equal to--
            ``(A) $40,000,000; plus
            ``(B) an additional amount, specified in an appropriation 
        Act for the Commission for that fiscal year to be collected and 
        credited to such appropriation, not to exceed the amount by 
        which the necessary expenses for the costs described in 
        paragraph (5) exceeds $40,000,000.
    ``(2) In making adjustments pursuant to this paragraph the 
Commission may round such fees to the nearest $5.00 in the case of fees 
under $100, or to the nearest $20 in the case of fees of $100 or more. 
The Commission shall transmit to the Congress notification of any 
adjustment made pursuant to this paragraph immediately upon the 
adoption of such adjustment.
    ``(3) The Commission is authorized to continue to collect fees at 
the prior year's rate until the effective date of fee adjustments or 
amendments made pursuant to paragraphs (1) and (4).
    ``(4) The Commission shall, by regulation, add, delete, or 
reclassify services, categories, applications, or other filings subject 
to application fees to reflect additions, deletions, or changes in the 
nature of its services or authorization of service processes as a 
consequence of Commission rulemaking proceedings or changes in law.
    ``(5) Any modified fees established under paragraph (4) shall be 
derived by determining the full-time equivalent number of employees 
performing application activities, adjusted to take into account other 
expenses that are reasonably related to the cost of processing the 
application or filing, including all executive and legal costs incurred 
by the Commission in the discharge of these functions, and other 
factors that the Commission determines are necessary in the public 
interest. The Commission shall--
            ``(A) transmit to the Congress notification of any proposed 
        modification made pursuant to this paragraph immediately upon 
        adoption of such proposal; and
            ``(B) transmit to the Congress notification of any 
        modification made pursuant to this paragraph immediately upon 
        adoption of such modification.
    ``(6) Increases or decreases in application fees made pursuant to 
this subsection shall not be subject to judicial review.''.
    (b) Treatment of Additional Collections.--Section 8(e) of such Act 
is amended to read as follows:
    ``(e) Of the moneys received from fees authorized under this 
section--
            ``(1) $40,000,000 shall be deposited in the general fund of 
        the Treasury to reimburse the United States for amounts 
        appropriated for use by the Commission in carrying out its 
        functions under this Act; and
            ``(2) the remainder shall be deposited as an offsetting 
        collection in, and credited to, the account providing 
        appropriations to carry out the functions of the Commission.''.
    (c) Schedule of Application Fees for PCS.--The schedule of 
application fees in section 8(g) of such Act is amended by adding, at 
the end of the portion under the heading ``common carrier services'', 
the following new item:

``23. Personal communications services
        ``a. Initial or new application....................     230.00 
        ``b. Amendment to pending application..............      35.00 
        ``c. Application for assignment or transfer of          230.00 
            control.
        ``d. Application for renewal of license............      35.00 
        ``e. Request for special temporary authority.......     200.00 
        ``f. Notification of completion of construction....      35.00 
        ``g. Request to combine service areas..............    50.00''.

    (d) Vanity Call Signs.--
            (1) Lifetime license fees.--
                    (A) Amendment.--The schedule of application fees in 
                section 8(g) of such Act is further amended by adding, 
                at the end of the portion under the heading ``private 
                radio services'', the following new item:

  ``11. Amateur vanity call signs..........................   150.00''.

                    (B) Treatment of receipts.--Moneys received from 
                fees established under the amendment made by this 
                subsection shall be deposited as an offsetting 
                collection in, and credited to, the account providing 
                appropriations to carry out the functions of the 
                Commission.
            (2) Termination of annual regulatory fees.--The schedule of 
        regulatory fees in section 9(g) of such Act (47 U.S.C. 159(g)) 
        is amended by striking the following item from the fees 
        applicable to the Private Radio Bureau:

                                                                        
                                                                        
                                                                        
                              ``Amateur vanity call-signs.          7''.
                                                                        


SEC. 3014. REGULATORY FEES.

    (a) Executive and Legal Costs.--Section 9(a)(1) of the 
Communications Act of 1934 (47 U.S.C. 159(a)(1)) is amended by 
inserting before the period at the end the following: ``, and all 
executive and legal costs incurred by the Commission in the discharge 
of these functions''.
    (b) Establishment and Adjustment.--Section 9(b) of such Act is 
amended--
            (1) in paragraph (4)(B), by striking ``90 days'' and 
        inserting ``45 days''; and
            (2) by adding at the end the following new paragraph:
            ``(5) Effective date of adjustments.--The Commission is 
        authorized to continue to collect fees at the prior year's rate 
        until the effective date of fee adjustments or amendments made 
        pursuant to paragraph (2) or (3).''.
    (c) Regulatory Fees for Satellite TV Operations.--The schedule of 
regulatory fees in section 9(g) of such Act is amended, in the fees 
applicable to the Mass Media Bureau, by inserting after each of the 
items pertaining to construction permits in the fees applicable to VHF 
commercial and UHF commercial TV the following new item:

                                                                        
                                                                        
                                                                        
                                ``Terrestrial television                
                                 satellite operations.....        500''.
                                                                        


    (d) Governmental entities use for common carrier purposes.--Section 
9(h) of such Act is amended by adding at the end the following new 
sentence: ``The exceptions provided by this subsection for governmental 
entities shall not be applicable to any services that are provided on a 
commercial basis in competition with another carrier.''.
    (e) Information Required in Connection With Adjustment of 
Regulatory Fees.--Title I of such Act is amended--
            (1) in section 9, by striking subsection (i); and
            (2) by inserting after section 9 the following new section:

``SEC. 10. ACCOUNTING SYSTEM AND ADJUSTMENT INFORMATION.

    ``(a) Accounting System Required.--The Commission shall develop 
accounting systems for the purposes of making the adjustments 
authorized by sections 8 and 9. The Commission shall annually prepare 
and submit to the Congress an analysis of such systems and shall 
annually afford interested persons the opportunity to submit comments 
concerning the allocation of the costs of performing the functions 
described in section 8(a)(5) and 9(a)(1) in making such adjustments in 
the schedules required by sections 8 and 9.
    ``(b) Information Required in Connection with Adjustment of 
Application and Regulatory Fees.--
            ``(1) Schedule of requested amounts.--No later than May 1 
        of each calendar year, the Commission shall prepare and 
        transmit to the Committees of Congress responsible for the 
        Commission's authorization and appropriations a detailed 
        schedule of the amounts requested by the President's budget to 
        be appropriated for the ensuing fiscal year for the activities 
        described in sections 8(a)(5) and 9(a)(1), allocated by 
        bureaus, divisions, and offices of the Commission.
            ``(2) Explanatory statement.--If the Commission anticipates 
        increases in the application fees or regulatory fees applicable 
        to any applicant, licensee, or unit subject to payment of fees, 
        the Commission shall submit to the Congress by May 1 of such 
        calendar year a statement explaining the relationship between 
        any such increases and either (A) increases in the amounts 
        requested to be appropriated for Commission activities in 
        connection with such applicants, licensees, or units subject to 
        payment of fees, or (B) additional activities to be performed 
        with respect to such applicants, licensees, or units.
            ``(3) Definition.--For purposes of this subsection, the 
        term `amount requested by the President's budget' shall include 
        any adjustments to such requests that are made by May 1 of such 
        calendar year. If any such adjustment is made after May 1, the 
        Commission shall provide such Committees with updated schedules 
        and statements containing the information required by this 
        subsection within 10 days after the date of any such 
        adjustment.''.

SEC. 3015. INSPECTION OF SHIP RADIO STATIONS.

    (a) Authority To Designate Entities To Inspect.--Section 4(f)(3) of 
the Communications Act of 1934 (47 U.S.C. 154(f)(3)) is amended by 
inserting before the period at the end the following: ``: And provided 
further, That, in the alternative, an entity designated by the 
Commission may make the inspections referred to in this paragraph''.
    (b) Conduct of Inspections.--Section 362(b) of such Act (47 U.S.C. 
362(b)) is amended to read as follows:
    ``(b) Every ship of the United States that is subject to this part 
shall have the equipment and apparatus prescribed therein inspected at 
least once each year by the Commission or an entity designated by the 
Commission. If, after such inspection, the Commission is satisfied that 
all relevant provisions of this Act and the station license have been 
complied with, the fact shall be certified to on the station license by 
the Commission. The Commissionshall make such additional inspections at 
frequent intervals as the Commission determines may be necessary to 
ensure compliance with the requirements of this Act. The Commission 
may, upon a finding that the public interest could be served thereby--
            ``(1) waive the annual inspection required under this 
        section for a period of up to 90 days for the sole purpose of 
        enabling a vessel to complete its voyage and proceed to a port 
        in the United States where an inspection can be held; or
            ``(2) waive the annual inspection required under this 
        section for a vessel that is in compliance with the radio 
        provisions of the Safety Convention and that is operating 
        solely in waters beyond the jurisdiction of the United States, 
        provided that such inspection shall be performed within 30 days 
        of such vessel's return to the United States.''.
    (c) Inspection By Other Entities.--Section 385 of such Act (47 
U.S.C. 385) is amended by inserting ``or an entity designated by the 
Commission'' after ``The Commission''.

SEC. 3016. EXPEDITED ITFS PROCESSING.

    Section 5(c)(1) of the Communications Act of 1934 (47 U.S.C. 
155(c)(1)) is amended by striking the last sentence and inserting the 
following: ``Except for cases involving the authorization of service in 
the Instructional Television Fixed Service, or as otherwise provided in 
this Act, nothing in this paragraph shall authorize the Commission to 
provide for the conduct, by any person or persons other than persons 
referred to in paragraph (2) or (3) of section 556(b) of title 5, 
United States Code, of any hearing to which such section applies.''.

SEC. 3017. TARIFF REJECTION AUTHORITY.

    Section 203(d) of the Communications Act of 1934 (47 U.S.C. 203(d)) 
is amended by inserting after the first sentence the following new 
sentences: ``The Commission may, after affording interested parties an 
opportunity to comment, reject a proposed tariff filing in whole or in 
part, if the filing or any part thereof is patently unlawful. In 
evaluating whether a proposed tariff filing is patently unlawful, the 
Commission may consider additional information filed by the carrier or 
any interested party and shall presume the facts alleged by the carrier 
to be true.''.

SEC. 3018. REFUND AUTHORITY.

    Title II of the Communications Act of 1934 (47 U.S.C. 201 et seq.) 
is amended by adding at the end thereof the following new section:

``SEC. 230. REFUND AUTHORITY.

    ``In addition to any other provision of this Act under which the 
Commission may order refunds, the Commission may require by order the 
refund of such portion of any charge by any carrier or carriers as 
results from a violation of section 220 (a), (b), or (d) or 221 (c) or 
(d) or of any of the rules promulgated pursuant to such sections or 
pursuant to section 215, 218, or 219. Such refunds shall be ordered 
only to the extent that the Commission or a court finds that such 
violation resulted in unlawful charges and shall be made to such 
persons or classes of persons as the Commission determines reasonably 
represent the persons from whom amounts were improperly received by 
reason of such violation. No refunds shall be required under this 
section unless--
            ``(1) the Commission issues an order advising the carrier 
        of its potential refund liability and provides the carrier with 
        an opportunity to file written comments as to why refunds 
        should not be required; and
            ``(2) such order is issued not later than 5 years after the 
        date the charge was paid.
In the case of a continuing violation, a violation shall be considered 
to occur on each date that the violation is repeated.''.

SEC. 3019. LICENSING OF AVIATION AND MARITIME SERVICES BY RULE.

    Section 307(e) of the Communications Act of 1934 (47 U.S.C. 307(e)) 
is amended to read as follows:
    ``(e)(1) Notwithstanding any license requirement established in 
this Act, if the Commission determines that such authorization serves 
the public interest, convenience, and necessity, the Commission may by 
rule authorize the operation of radio stations without individual 
licenses in the following radio services: (A) the aviation radio 
service for aircraft stations operated on domestic flights when such 
aircraft are not otherwise required to carry a radio station; and (B) 
the maritime radio service for ship stations navigated on domestic 
voyages when such ships are not otherwise required to carry a radio 
station.
    ``(2) Any radio station operator who is authorized by the 
Commission to operate without an individual license shall comply with 
all other provisions of this Act and with rules prescribed by the 
Commission under this Act.
    ``(3) For purposes of this subsection, the terms `aircraft station' 
and `ship station' shall have the meanings given them by the Commission 
by rule.''.

SEC. 3020. AUCTION TECHNICAL AMENDMENTS.

    (a) Funding Availability.--Section 309(j)(8)(B) of the 
Communications Act of 1934 (47 U.S.C. 309(j)(8)(B)) is amended by 
adding at the end the following new sentence: ``Such offsetting 
collections are authorized to remain available until expended.''.
    (b) Escrow of Deposits.--Section 309(j)(8) of such Act is further 
amended by adding at the end the following new subparagraph:
                    ``(C) Escrow of deposit.--The Commission is 
                authorized, based on the competitive bidding 
                methodology selected, to provide for the deposit of 
                moneys for bids in an interest-bearing account until 
                such time as the Commission accepts a deposit from the 
                high bidder. All interest earned on bid moneys received 
                from the winning bidder shall be deposited into the 
                general fund of the Treasury. All interest earned on 
                bid moneys deposited from unsuccessful bidders, less 
                any applicable fees and penalties, shall be paid to 
                those bidders.''.

SEC. 3021. FORFEITURES FOR VIOLATIONS IMPERILING SAFETY OF LIFE.

    (a) Administrative Sanctions.--Section 312(a) of the Communications 
Act of 1934 (47 U.S.C. 312(a)) is amended--
            (1) by striking ``or'' at the end of paragraph (6);
            (2) by striking the period at the end of paragraph (7) and 
        inserting ``; or''; and
            (3) by adding at the end the following new paragraph:
            ``(8) for failure to comply with any requirement of this 
        Act or the Commission's rules that imperils the safety of 
        life.''.
    (b) Forfeitures.--Section 503(b)(1) of such Act (47 U.S.C. 
503(b)(1)) is amended--
            (1) by striking ``or'' at the end of subparagraph (C);
            (2) by striking the semicolon at the end of subparagraph 
        (D) and inserting ``; or''; and
            (3) by adding after subparagraph (D) the following new 
        subparagraph:
            ``(E) failed to comply with any requirement of this Act or 
        the Commission's rules that imperils the safety of life;''.

SEC. 3022. USE OF EXPERTS AND CONSULTANTS.

    Section 4(f)(1) of the Communications Act of 1934 (47 U.S.C. 154) 
is amended by adding at the end thereof the following: ``The Commission 
may also procure the services of experts and consultants in accordance 
with section 3109 of title 5, United States Code, relating to 
appointments in the Federal Service, at rates of compensation for 
individuals not to exceed the daily rate equivalent to the maximum rate 
payable for senior-level positions under section 5276 of title 5, 
United States Code.''.

SEC. 3023. STATUTE OF LIMITATIONS FOR FORFEITURE PROCEEDINGS AGAINST 
                    COMMON CARRIERS.

    Section 503(b)(6) of the Communications Act of 1934 (47 U.S.C. 
503(b)(6)) is amended--
            (1) by striking ``or'' at the end of subparagraph (A);
            (2) by inserting ``and is not a common carrier'' after 
        ``title III of this Act'' in subparagraph (B);
            (3) by redesignating subparagraph (B) as subparagraph (C); 
        and
            (4) by inserting after subparagraph (A) the following new 
        subparagraph:
            ``(B) such person is a common carrier and the required 
        notice of apparent liability is issued more than 5 years after 
        the date the violation charged occurred; or''.

SEC. 3024. UTILIZATION OF FM BAND FOR ASSISTIVE DEVICES FOR HEARING 
                    IMPAIRED INDIVIDUALS.

    Within 6 months after the date of enactment of this Act, the 
Federal Communications Commission shall report to the Congress on the 
existing and future use of the FM band to facilitate the use of 
auditory assistive devices for individuals with hearing impairments. In 
preparing such report, the Commission shall consider--
            (1) the potential for utilizing FM band auditory assistive 
        devices to comply with the American with Disabilities Act;
            (2) the impact on such compliance of the vulnerability of 
        such devices to harmful interference from radio licensees; and
            (3) alternative frequency allocations that could facilitate 
        such compliance.

SEC. 3025. TECHNICAL AMENDMENT.

    Section 302(d)(1) of the Communications Act of 1934 (47 U.S.C. 
309(d)(1)) is amended--
            (1) in subparagraph (A), by striking ``allocated to the 
        domestic cellular radio telecommunications service'' and 
        inserting ``utilized to provide commercial mobile service (as 
        defined in section 332(d))''; and
            (2) in subparagraph (C), by striking ``cellular'' and 
        inserting ``commercial mobile service''.

        Subtitle B--Nuclear Regulatory Commission Annual Charge

SEC. 3031. NUCLEAR REGULATORY COMMISSION ANNUAL CHARGES.

    Section 6101(a)(3) of the Omnibus Budget Reconciliation Act of 1990 
(42 U.S.C. 2214(a)(3)) is amended by striking ``September 30, 1998'' 
and inserting ``September 30, 2002''.

            Subtitle C--United States Enrichment Corporation

SEC. 3035. SHORT TITLE AND REFERENCE.

    (a) Short Title.--This subtitle may be cited as the ``USEC 
Privatization Act''.
    (b) Reference.--Except as otherwise expressly provided, whenever in 
this subtitle an amendment or repeal is expressed in terms of an 
amendment to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provision of the 
Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.).

SEC. 3036. PRODUCTION FACILITY.

    Paragraph v. of section 11 (42 U.S.C. 2014 v.) is amended by 
striking ``or the construction and operation of a uranium enrichment 
production facility using Atomic Vapor Laser Isotope Separation 
technology''.

SEC. 3037. DEFINITIONS.

    Section 1201 (42 U.S.C. 2297) is amended--
            (1) in paragraph (4), by inserting before the period the 
        following: ``and any successor corporation established through 
        privatization of the Corporation'';
            (2) by redesignating paragraphs (10) through (13) as 
        paragraphs (14) through (17), respectively, and by inserting 
        after paragraph (9) the following new paragraphs:
            ``(10) The term `low-level radioactive waste' has the 
        meaning given such term in section 102(9) of the Low-Level 
        Radioactive Waste Policy Amendments Act of 1985 (42 U.S.C. 
        2021b(9)).
            ``(11) The term `mixed waste' has the meaning given such 
        term in section 1004(41) of the Solid Waste Disposal Act (42 
        U.S.C. 6903(41)).
            ``(12) The term `privatization' means the transfer of 
        ownership of the Corporation to private investors pursuant to 
        chapter 25.
            ``(13) The term `privatization date' means the date on 
        which 100 percent of ownership of the Corporation has been 
        transferred to private investors.'';
            (3) by inserting after paragraph (17) (as redesignated) the 
        following new paragraph:
            ``(18) The term `transition date' means July 1, 1993.'';
            (4) by redesignating the unredesignated paragraph (14) as 
        paragraph (19); and
            (5) by adding the following new paragraphs after paragraph 
        (19):
            ``(20) The term `gaseous diffusion plants' means the 
        Paducah Gaseous Diffusion Plant at Paducah, Kentucky and the 
        Portsmouth Gaseous Diffusion Plant at Piketon, Ohio.
            ``(21) The term `private corporation' means the corporation 
        established under section 1503.
            ``(22) The term `Russian HEU agreement' means the Agreement 
        Between the Government of the United States of America and the 
        Government of the Russian Federation Concerning the Disposition 
        of Highly Enriched Uranium Extracted from Nuclear Weapons, 
        dated February 18, 1993.
            ``(23) The term `Suspension Agreement' means the Agreement 
        to Suspend the Antidumping Investigation on Uranium from the 
        Russian Federation, as amended.''.

SEC. 3038. EMPLOYEES OF THE CORPORATION.

    (a) Paragraphs (1) and (2).--Section 1305(e) (42 U.S.C. 2297b-4(e)) 
is amended by striking paragraphs (1) and (2) and inserting in thereof 
the following:
            ``(1) In general.--
                    ``(A) Privatization shall not diminish the accrued, 
                vested pension benefits of employees of the 
                Corporation's operating contractor at the two gaseous 
                diffusion plants.
                    ``(B) In the event that the private corporation 
                terminates or changes the contractor at either or both 
                of the gaseous diffusion plants, the plan sponsor or 
                other appropriate fiduciary of the pension plan 
                covering employees of the prior operating contractor 
                shall arrange for the transfer of all plan assets and 
                liabilities relating to accrued pension benefits of 
                such plan's participants and beneficiaries from such 
                plan to a pension plan sponsored by the new contractor 
                or the private corporation, as the case may be.
                    ``(C) Any employer (including the private 
                corporation or any contractor of the private 
                corporation) at a gaseous diffusion plant shall abide 
                by the terms of any unexpired collective bargaining 
                agreement covering employees in bargaining units at the 
                plant and in effect on the privatization date until the 
                expiration of the agreement.
                    ``(D) In the event of a plant closing or mass 
                layoff (as such terms are defined in section 2101(a)(2) 
                and (3) of title 29, United States Code) at either of 
                the gaseous diffusion plants, the Secretary of Energy 
                shall treat such plant as a Department of Energy 
                defense nuclear facility and any person employed by an 
                operating contractor on the privatization date at 
                either plant as a Department of Energy employee for 
                purposes of sections 3161 through 3163 of the National 
                Defense Authorization Act for Fiscal Year 1993 (42 
                U.S.C. 7274h-7274j).
                    ``(E) The Department of Energy and the private 
                corporation shall continue to fund postretirement 
                health benefits for persons employed by an operating 
                contractor at either of the gaseous diffusion plants at 
                substantially the same level of coverage as eligible 
                retirees are entitled to receive on the privatization 
                date, consistent with clauses (i) through (iii), except 
                that the Department of Energy, the private corporations 
                and the operating contractor shall have the right to 
                implement cost-saving measures, including (but not 
                limited to) preferred provider organizations, managed 
                care programs, mandatory second opinions before surgery 
                or other medical procedures, and mandatory use of 
                generic drugs, that do not materially diminish the 
                overall quality of the medical care provided--
                            ``(i) persons eligible for this coverage 
                        shall be limited to persons who retired from 
                        active employment at one of the gaseous 
                        diffusion plants as of the privatization date, 
                        as vested participants in a pension plan 
                        maintained either by the Corporation's 
                        operating contractor or by a contractor 
                        employed prior to July 1, 1993, by the 
                        Department of Energy to operate either of the 
                        gaseous diffusion plants and persons who, as of 
                        the privatization date, are employed by the 
                        Corporation's operating contractor and are 
                        vested participants in a pension plan 
                        maintained either by the Corporation's 
                        operating contractor or by a contractor 
                        employed prior to July 1, 1993, by the 
                        Department of Energy to operate either of the 
                        gaseous diffusion plants;
                            ``(ii) for persons who retired from 
                        employment with an operating contractor prior 
                        to July 1, 1993, the Department of Energy shall 
                        fund the entire cost of postretirement health 
                        benefits; and
                            ``(iii) for persons who retire from 
                        employment with an operating contractor after 
                        July 1, 1993, the Department of Energy and the 
                        private corporation shall fund the cost of 
                        postretirement health benefits in proportion to 
                        the retired persons' years and months of 
                        service at a gaseous diffusion plant under 
                        their respective management.''.
    (b) Paragraph (4).--Paragraph (4) of section 1305(e) (42 U.S.C. 
2297b-4(e)(4)) is amended--
            (1) by striking ``and detailees'' in the heading;
            (2) by striking the first sentence;
            (3) in the second sentence, by inserting ``from other 
        Federal employment'' after ``transfer to the Corporation''; and
            (4) by striking the last sentence.

SEC. 3039. MARKETING AND CONTRACTING AUTHORITY.

    (a) Marketing Authority.--Section 1401(a) (42 U.S.C. 2297c(a)) is 
amended effective on the privatization date (as defined in section 
1201(13) of the Atomic Energy Act of 1954)--
            (1) by amending the subsection heading to read ``Marketing 
        Authority.--''; and
            (2) by striking the first sentence.
    (b) Transfer of Contracts.--Section 1401(b) (42 U.S.C. 2297c(b)) is 
amended--
            (1) in paragraph (2)(B), by adding at the end the 
        following: ``The privatization of the Corporation shall not 
        affect the terms of, or the rights or obligations of the 
        parties to, any such power purchase contract.''; and
            (2) by adding at the end the following:
            ``(3) Effect of transfer.--
                    ``(A) As a result of the transfer pursuant to 
                paragraph (1), all rights, privileges, and benefits 
                under such contracts, agreements, and leases, including 
                the right to amend, modify, extend, revise, or 
                terminate any of such contracts, agreements, or leases 
                were irrevocably assigned to the Corporation for its 
                exclusive benefit.
                    ``(B) Notwithstanding the transfer pursuant to 
                paragraph (1), the United States shall remain obligated 
                to the parties to the contracts, agreements, and leases 
                transferred pursuant to paragraph (1) for the 
                performance of the obligations of the United States 
                thereunder during the term thereof. The Corporation 
                shall reimburse the United States for any amount paid 
                by the United States in respect of such obligations 
                arising after the privatization date to the extent such 
                amount is a legal and valid obligation of the 
                Corporation then due.
                    ``(C) After the privatization date, upon any 
                material amendment, modification, extension, revision, 
                replacement, or termination of any contract, agreement, 
                or lease transferred under paragraph (1), the United 
                States shall be released from further obligation under 
                such contract, agreement, or lease, except that such 
                action shall not release the United States from 
                obligations arising under such contract, agreement, or 
                lease prior to such time.''.
    (c) Pricing.--Section 1402 (42 U.S.C. 2297c-1) is amended to read 
as follows:

``SEC. 1402. PRICING.

    ``The Corporation shall establish prices for its products, 
materials, and services provided to customers on a basis that will 
allow it to attain the normal business objectives of a profitmaking 
corporation.''.
    (d) Leasing of Gaseous Diffusion Facilities of Department.--
Effective on the privatization date (as defined in section 1201(13) of 
the Atomic Energy Act of 1954), section 1403 (42 U.S.C. 2297c-2) is 
amended by adding at the end the following:
    ``(h) Low-Level Radioactive Waste and Mixed Waste.--
            ``(1) Responsibility of the department; costs.--
                    ``(A) With respect to low-level radioactive waste 
                and mixed waste generated by the Corporation as a 
                result of the operation of the facilities and related 
                property leased by the Corporation pursuant to 
                subsection (a) or as a result of treatment of such 
                wastes at a location other than the facilities and 
                related property leased by the Corporation pursuant to 
                subsection (a) the Department, at the request of the 
                Corporation, shall--
                            ``(i) accept for treatment or disposal of 
                        all such wastes for which treatment or disposal 
                        technologies and capacities exist, whether 
                        within the Department or elsewhere; and
                            ``(ii) accept for storage (or ultimately 
                        treatment or disposal) all such wastes for 
                        which treatment and disposal technologies or 
                        capacities do not exist, pending development of 
                        such technologies or availability of such 
                        capacities for such wastes.
                    ``(B) All low-level wastes and mixed wastes that 
                the Department accepts for treatment, storage, or 
                disposal pursuant to subparagraph (A) shall, for the 
                purpose of any permits, licenses, authorizations, 
                agreements, or orders involving the Department and 
                other Federal agencies or State or local governments, 
                be deemed to be generated by the Department and the 
                Department shall handle such wastes in accordance with 
                any such permits, licenses, authorizations, agreements, 
                or orders. The Department shall obtain any additional 
                permits, licenses, or authorizations necessary to 
                handle such wastes, shall amend any such agreements or 
                orders as necessary to handle such wastes, and shall 
                handle such wastes in accordance therewith.
                    ``(C) The Corporation shall reimburse the 
                Department for the treatment, storage, or disposal of 
                low-level radioactive waste or mixed waste pursuant to 
                subparagraph (A) in an amount equal to the Department's 
                costs but in no event greater than an amount equal to 
                that which would be charged by commercial, State, 
                regional, or interstate compact entities for treatment, 
                storage, or disposal of such waste.
            ``(2) Agreements with other persons.--The Corporation may 
        also enter into agreements for the treatment, storage, or 
        disposal of low-level radioactive waste and mixed waste 
        generated by the Corporation as a result of the operation of 
        the facilities and related property leased by the Corporation 
        pursuant to subsection (a) with any person other than the 
        Department that is authorized by applicable laws and 
        regulations to treat, store, or dispose of such wastes.''.
    (e) Liabilities.--
            (1) Subsection (a) of section 1406 (42 U.S.C. 2297c-5(a)) 
        is amended--
                    (A) by inserting ``and Privatization'' after 
                ``Transition'' in the heading; and
                    (B) by adding at the end the following: ``As of the 
                privatization date, all liabilities attributable to the 
                operation of the Corporation from the transition date 
                to the privatization date shall be direct liabilities 
                of the United States.''.
            (2) Subsection (b) of section 1406 (42 U.S.C. 2297c-5(b)) 
        is amended--
                    (A) by inserting ``and Privatization'' after 
                ``Transition'' in the heading; and
                    (B) by adding at the end the following: ``As of the 
                privatization date, any judgment entered against the 
                Corporation imposing liability arising out of the 
                operation of the Corporation from the transition date 
                to the privatization date shall be considered a 
                judgment against the United States.''.
            (3) Subsection (d) of section 1406 (42 U.S.C. 2297c-5(d)) 
        is amended--
                    (A) by inserting ``and Privatization'' after 
                ``Transition'' in the heading; and
                    (B) by striking ``the transition date'' and 
                inserting ``the privatization date (or, in the event 
                the privatization date does not occur, the transition 
                date)''.
    (f) Transfer of Uranium.--
            (1) Amendment.--Title II (42 U.S.C. 2297 et seq.) is 
        amended by redesignating section 1408 as section 1409 and by 
        inserting after section 1407 the following:

``SEC. 1408. URANIUM TRANSFERS AND SALES.

    ``(a) Transfers and Sales by the Secretary.--The Secretary shall 
not provide enrichment services or transfer or sell any uranium 
(including natural or enriched uranium in any form) to any person 
except as provided in this section.
    ``(b) Russian Heu.--
            (1) Tranfers.--Prior to December 31, 1996, the United 
        States Executive Agent under the Russian HEU Agreement shall 
        transfer to the Secretary without charge an amount of uranium 
        hexafluoride equivalent to the natural uranium component of 
        low-enriched uranium derived from at least 18 metric tons of 
        highly enriched uranium purchased from the Russian Executive 
        Agent under the Russian HEU Agreement. The quantity of such 
        uranium hexafluoride delivered to the Secretary shall be based 
        on a tails assay of 0.30 U235. Title to uranium hexafluoride 
        delivered to the Secretary pursuant to this paragraph shall 
        transfer to the Secretary upon delivery of such material to the 
        Secretary. Uranium hexafluoride delivered to the Secretary 
        pursuant to this paragraph shall be deemed to be of Russian 
        origin.
            ``(2) Contracts.--Within 7 years of the date of enactment 
        of the USEC Privatization Act, the Secretary shall enter into 
        contracts to sell the uranium hexafluoride transferred to the 
        Secretary pursuant to paragraph (1). Such uranium hexafluoride 
        shall be sold--
                    ``(A) at any time for use in the United States for 
                the purpose of overfeeding;
                    ``(B) at any time for use outside the United 
                States; and
                    ``(C) for consumption by end users in the United 
                States not prior to January 1, 2002, in volumes not to 
                exceed 3 million pounds U3O8 equivalent per year.
            ``(3) Uranium hexafluoride.--With respect to all low-
        enriched uranium that is delivered to the United States 
        Executive Agent under the Russian HEU Agreement after January 
        1, 1997, the United States Executive Agent shall, upon request 
        of the Russian Executive Agent, deliver to the Russian 
        Executive Agent an amount of uranium hexafluoride equivalent to 
        the natural uranium component of such low-enriched uranium 
        simultaneously with the delivery of such low-enriched uranium. 
        The quantity of such uranium hexafluoride delivered to the 
        Russian Executive Agent shall be based on a tails assay of 0.30 
        U235. Title to uranium hexafluoride delivered to the Russian 
        Executive Agent pursuant to this paragraph shall transfer to 
        the Russian Executive Agent upon delivery of such material to 
        the Russian Executive Agent at a North American facility 
        designated by the Russian Executive Agent. Uranium hexafluoride 
        delivered to the Russian Executive Agent pursuant to this 
        paragraph shall be deemed to be of Russian origin. Such uranium 
        hexafluoride may be sold to any person or entity consistent 
        with the limitations on delivery to end users set forth in this 
        subsection. Nothing in this subsection shall restrict the sale 
        of the conversion component of such uranium hexafluoride.
            ``(4) Independent party.--In the event that the Russian 
        Executive Agent does not request delivery of the natural 
        uranium component of any low-enriched uranium, as contemplated 
        in paragraph (3), within 90 days of the date such low-enriched 
        uranium is delivered to the United States Executive Agent, then 
        the United States Executive Agent shall engage an independent 
        party through a competitive selection process to auction an 
        amount of uranium hexafluoride equivalent to the natural 
        uranium component of such low-enriched uranium. Such 
        independent party shall sell such uranium hexafluoride to any 
        person or entity consistent with the limitations set forth in 
        this subsection. The independent entity shall pay to the 
        Russian Executive Agent the proceeds of any such auction less 
        all transaction and other administrative costs. The quantity of 
        such uranium hexafluoride auctioned shall be based on a tails 
        assay of 0.30 U235. Title to uranium hexafluoride auctioned 
        pursuant to this paragraph shall transfer to the buyer of such 
        material upon delivery of such material to the buyer. Uranium 
        hexafluoride auctioned pursuant to this paragraph shall be 
        deemed to be of Russian origin.
            ``(5) Consumption.--Except as provided in paragraphs (6) 
        and (7), uranium hexafluoride delivered to the Secretary under 
        paragraph (1) or the Russian Executive Agent under paragraph 
        (3) or auctioned pursuant to paragraph (4), may not be 
        delivered for consumption by end users in the United States 
        prior to January 1, 1998 and thereafter only in accordance with 
        the following schedule:

                                    Annual Maximum Deliveries to End 
                                            Users
``Year                              (millions lbs. U3O8 
                                            equivalent)
    1998-
                                        2 million lbs. U3O8 
                                                equivalent
    1999-
                                        4 million lbs. U3O8 
                                                equivalent
    2000-
                                        6 million lbs. U3O8 
                                                equivalent
    2001-
                                        8 million lbs. U3O8 
                                                equivalent
    2002-
                                        10 million lbs. U3O8 
                                                equivalent
    2003-
                                        12 million lbs. U3O8 
                                                equivalent
    2004-
                                        14 million lbs. U3O8 
                                                equivalent
    2005 and each year thereafter
                                        16 million lbs. U3O8 
                                                equivalent

            ``(6) Matched Sales.--Uranium hexafluoride delivered to the 
        Secretary under paragraph (1) or the Russian Executive Agent 
        under paragraph (3) or auctioned pursuant to paragraph (4) may 
        be sold at any time as Russian-origin natural uranium in a sale 
        with an equal portion of U.S.-origin natural uranium pursuant 
        to the Suspension Agreement and in such case shall not be 
        counted against the annual maximum deliveries set forth in 
        paragraph (5).
            ``(7) Overfeeding.--Uranium hexafluoride delivered to the 
        Secretary under paragraph (1) or the Russian Executive Agent 
        under paragraph (3) or auctioned pursuant to paragraph (4) may 
        be sold at any time for use in the United States for the 
        purpose of overfeeding in the operations of enrichment 
        facilities.
    ``(c) Transfers to the corporation.--(1) Before the privatization 
date, the Secretary may transfer to the Corporation without charge the 
low enriched uranium from up to 50 metric tons of highly enriched 
uranium and up to 7,000 metric tons of natural uranium, subject to the 
restrictions in subsection (b)(2).
    ``(2) The Corporation (or its successor) may not deliver for 
commercial end use--
            ``(A) any of the natural uranium transferred under this 
        subsection before January 1, 1998;
            ``(B) more than 10 percent of the natural uranium (by 
        uranium hexafluoride equivalent content) transferred under this 
        subsection or more than 4 million pounds, whichever is less, in 
        any calendar year after 1997; or
            ``(C) more than 800,000 separative work units of low-
        enriched uranium transferred under this subsection in any 
        calendar year.
    ``(d) Inventory Sales.--(1) In addition to the transfers authorized 
under subsection (b), the Secretary may, from time to time, sell 
natural and low-enriched uranium (including low-enriched uranium 
derived from highly enriched uranium) from the Department of Energy s 
stockpile.
    ``(2) Except as provided in subsections (b) and (d), no sale or 
transfer of natural or low-enriched uranium shall be made unless--
            ``(A) the President determines that the material is not 
        necessary to national security needs,
            ``(B) the Secretary determines that the sale of the 
        material will not have an adverse impact on the domestic 
        uranium mining and enrichment industries, taking into account 
        the sales of uranium under the Russian HEU Agreement and the 
        Suspension Agreement, and
            ``(C) the price paid to the Secretary will not be less than 
        the fair market value of the material.
    ``(e) Government Transfers.--Notwithstanding subsection (c), the 
Secretary may transfer or sell low-enriched uranium--
            ``(1) to a federal agency if the material is transferred 
        for the use of the receiving agency without any resale or 
        transfer to another entity and the material does not meet 
        commercial specifications;
            ``(2) to any person for national security purposes, as 
        determined by the Secretary; or
            ``(3) to any state or local agency or nonprofit, 
        charitable, or educational institution for use other than the 
        generation of electricity for commercial use.''.
            (2) Conforming Amendment.--The table of contents for 
        chapter 24 is amended by redesignating the item relating to 
        section 1408 as the item relating to section 1409 and by 
        inserting after the item for section 1407 the following:

``Sec. 1408. Uranium transfers and sales.''.

SEC. 3040. PRIVATIZATION OF THE CORPORATION.

    (a) Establishment of Private Corporation.--Chapter 25 (42 U.S.C. 
2297d et seq.) is amended by adding at the end the following new 
section:

``SEC. 1503. ESTABLISHMENT OF PRIVATE CORPORATION.

    ``(a) Establishment.--
            ``(1) In general.--In order to facilitate privatization, 
        the Corporation may provide for the establishment of a private 
        corporation organized under the laws of any of the several 
        States. Such corporation shall have among its purposes the 
        following:
                    ``(A) To help maintain a reliable and economical 
                domestic source of uranium enrichment services.
                    ``(B) To undertake any and all activities as 
                provided in its corporate charter.
            ``(2) Authorities.--The corporation established pursuant to 
        paragraph (1) shall be authorized to--
                    ``(A) enrich uranium, provide for uranium to be 
                enriched by others, or acquire enriched uranium 
                (including low-enriched uranium derived from highly 
                enriched uranium);
                    ``(B) conduct, or provide for conducting, those 
                research and development activities related to uranium 
                enrichment and related processes and activities the 
                corporation considers necessary or advisable to 
                maintain itself as a commercial enterprise operating on 
                a profitable and efficient basis;
                    ``(C) enter into transactions regarding uranium, 
                enriched uranium, or depleted uranium with--
                            ``(i) persons licensed under section 53, 
                        63, 103, or 104 in accordance with the licenses 
                        held by those persons;
                            ``(ii) persons in accordance with, and 
                        within the period of, an agreement for 
                        cooperation arranged under section 123; or
                            ``(iii) persons otherwise authorized by law 
                        to enter into such transactions;
                    ``(D) enter into contracts with persons licensed 
                under section 53, 63, 103, or 104, for as long as the 
                corporation considers necessary or desirable, to 
                provide uranium or uranium enrichment and related 
                services;
                    ``(E) enter into contracts to provide uranium or 
                uranium enrichment and related services in accordance 
                with, and within the period of, an agreement for 
                cooperation arranged under section 123 or as otherwise 
                authorized by law; and
                    ``(F) take any and all such other actions as are 
                permitted by the law of the jurisdiction of 
                incorporation of the corporation.
            ``(3) Transfer of assets.--For purposes of implementing the 
        privatization, the Corporation may transfer some or all of its 
        assets and obligations to the corporation established pursuant 
        to this section, including--
                    ``(A) all of the Corporation's assets and 
                obligations, including all of the Corporation's rights, 
                duties, and obligations accruing subsequent to the 
                privatization date under contracts, agreements, and 
                leases entered into by the Corporation before the 
                privatization date, including all uranium enrichment 
                contracts and power purchase contracts;
                    ``(B) all funds in accounts of the Corporation held 
                by the Treasury or on deposit with any bank or other 
                financial institution;
                    ``(C) all of the Corporation's rights, duties, and 
                obligations, accruing subsequent to the privatization 
                date, under the power purchase contracts covered by 
                section 1401(b)(2)(B);
                    ``(D) all of the Corporation's rights, duties, and 
                obligations, accruing subsequent to the privatization 
                date, under the lease agreement between the Department 
                and the Corporation executed by the Department and the 
                Corporation pursuant to section 1403; and
                    ``(E) all of the Corporation's records, including 
                all of the papers and other documentary materials, 
                regardless of physical form or chharacteristics, made 
                or received by the Corporation.
            ``(4) Merger or consolidation.--For purposes of 
        implementing the privatization, the Corporation may merge or 
        consolidate with the corporation established pursuant to 
        subsection (a)(1) if such action is contemplated by the plan 
        for privatization approved by the President under section 
        1502(b). The Board shall have exclusive authority to approve 
        such merger or consolidation and to take all further actions 
        necessary to consummate such merger or consolidation, and no 
        action by or in respect of shareholders shall be required. The 
        merger or consolidation shall be effected in accordance with, 
        and have the effects of a merger or consolidation under, the 
        laws of the jurisdiction of incorporation of the surviving 
        corporation, and all rights and benefits provided under this 
        title to the Corporation shall apply to the surviving 
        corporation as if it were the Corporation.
    ``(b) OSHA Requirements.--For purposes of the regulation of 
radiological and nonradiological hazards under the Occupational Safety 
and Health Act of 1970, the corporation established pursuant to 
subsection (a)(1) shall be treated in the same manner as other 
employers licensed by the Nuclear Regulatory Commission. Any 
interagency agreement entered into between the Nuclear Regulatory 
Commission and the Occupational Safety and Health Administration 
governing the scope of their respective regulatory authorities shall 
apply to the corporation as if the corporation were a Nuclear 
Regulatory Commission licensee.
    ``(c) Legal Status of Private Corporation.--
            ``(1) Not federal agency.--The corporation established 
        pursuant to subsection (a)(1) shall not be an agency, 
        instrumentality, or establishment of the United States 
        Government and shall not be a Government corporation or 
        Government-controlled corporation.
            ``(2) No recourse against united states.--Obligations of 
        the corporation established pursuant to subsection (a)(1) shall 
        not be obligations of, or guaranteed as to principal or 
        interest by, the Corporation or the United States, and the 
        obligations shall so plainly state.
            ``(3) No claims court jurisdiction.--No action under 
        section 1491 of title 28, United States Code, shall be 
        allowable against the United States based on the actions of the 
        corporation established pursuant to subsection (a)(1).
    ``(d) Board of Director's Election After Public Offering.--In the 
event that the privatization is implemented by means of a public 
offering, an election of the members of the board of directors of the 
Corporation by the shareholders shall be conducted before the end of 
the 1-year period beginning the date shares are first offered to the 
public pursuant to such public offering.
    ``(e) Adequate Proceeds.--The Secretary of Energy shall not allow 
the privatization of the Corporation unless before the sale date the 
Secretary determines that the estimated sum of the gross proceeds from 
the sale of the Corporation will be an adequate amount.''.
    (b) Ownership Limitations.--Chapter 25 (as amended by subsection 
(a)) is amended by adding at the end the following new section:

``SEC. 1504. OWNERSHIP LIMITATIONS.

    ``(a) Securities Limitation.--In the event that the privatization 
is implemented by means of a public offering, during a period of 3 
years beginning on the privatization date, no person, directly or 
indirectly, may acquire or hold securities representing more than 10 
percent of the total votes of all outstanding voting securities of the 
Corporation.
    ``(b) Application.--Subsection (a) shall not apply--
            ``(1) to any employee stock ownership plan of the 
        Corporation,
            ``(2) to underwriting syndicates holding shares for resale, 
        or
            ``(3) in the case of shares beneficially held for others, 
        to commercial banks, broker-dealers, clearing corporations, or 
        other nominees.
    ``(c) Acquisitions.--No director, officer, or employee of the 
Corporation may acquire any securities, or any right to acquire 
securities, of the Corporation--
            ``(1) in the public offering of securities of the 
        Corporation in the implementation of the privatization,
            ``(2) pursuant to any agreement, arrangement, or 
        understanding entered into before the privatization date, or
            ``(3) before the election of directors of the Corporation 
        under section 1503(d) on any terms more favorable than those 
        offered to the general public.''.
    (c) Exemption From Liability.--Chapter 25 (as amended by subsection 
(b)) is amended by adding at the end the following new section:

``SEC. 1505. EXEMPTION FROM LIABILITY.

    ``(a) In General.--No director, officer, employee, or agent of the 
Corporation shall be liable, for money damages or otherwise, to any 
party if, with respect to the subject matter of the action, suit, or 
proceeding, such person was fulfilling a duty, in connection with any 
action taken in connection with the privatization, which such person in 
good faith reasonably believed to be required by law or vested in such 
person.
    ``(b) Exception.--The privatization shall be subject to the 
Securities Act of 1933 and the Securities Exchange Act of 1934. The 
exemption set forth in subsection (a) shall not apply to claims arising 
under such Acts or under the Constitution or laws of any State, 
territory, or possession of the United States relating to transactions 
in securities, which claims are in connection with a public offering 
implementing the privatization.
    ``(c) Securities Laws Applicable.--Any offering or sale of 
securities by the corporation established pursuant to section 
1503(a)(1) shall be subject to the Securities Act of 1933, the 
Securities Exchange Act of 1934 and the provisions of the Constitution 
and laws of any State, territory, or possession of the United States 
relating to transactions in securities.''.
    (d) Resolution of Certain Issues.--Chapter 25 (as amended by 
subsection (c)) is amended by adding at the end the following new 
section:

``SEC. 1506. RESOLUTION OF CERTAIN ISSUES.

    ``(a) Corporation Actions.--Notwithstanding any provision of any 
agreement to which the Corporation is a party, the Corporation shall 
not be considered to be in breach, default, or violation of any such 
agreement because of any provision of this chapter or any action the 
Corporation is required to take under this chapter.
    ``(b) Right To Sue Withdrawn.--The United States hereby withdraws 
any stated or implied consent for the United States, or any agent or 
officer of the United States, to be sued by any person for any legal, 
equitable, or other relief with respect to any claim arising out of, or 
resulting from, acts or omissions under this chapter.''.
    (e) Additional Provisions.--Chapter 25 (as amended by subsection 
(d)) is amended by adding at the end the following:

``SEC. 1507. APPLICATION OF PRIVATIZATION PROCEEDS.

    ``The proceeds from the privatization shall be included in the 
budget baseline required by the Balanced Budget and Emergency Deficit 
Control Act of 1985 and shall be counted as an offset to direct 
spending for purposes of section 252 of such Act, notwithstanding 
section 257(e) of such Act.''.
    (f) Conforming Amendment.--The table of contents for chapter 25 is 
amended by inserting after the item for section 1502 the following:

``Sec. 1503. Establishment of Private Corporation.
``Sec. 1504. Ownership Limitations.
``Sec. 1505. Exemption from Liability.
``Sec. 1506. Resolution of Certain Issues.
``Sec. 1507. Application of Privatization Proceeds.''.

    (g) Section 193 (42 U.S.C. 2243) is amended by adding at the end 
the following:
    ``(f) Limitation.--If the privatization of the United States 
Enrichment Corporation results in the Corporation being--
            ``(1) owned, controlled, or dominated by a foreign 
        corporation or a foreign government, or
            ``(2) otherwise inimical to the common defense or security 
        of the United States,
any license held by the Corporation under sections 53 and 63 shall be 
terminated.''.
    (h) Period for Congressional Review.--Section 1502(d) (42 U.S.C. 
2297d-1(d)) is amended by striking ``less than 60 days after 
notification of the Congress'' and inserting ``less than 60 days after 
the date of the report to Congress by the Comptroller General under 
subsection (c)''.

SEC. 3041. PERIODIC CERTIFICATION OF COMPLIANCE.

    Section 1701(c)(2) (42 U.S.C. 2297f(c)(2)) is amended by striking 
``Annual application for certificate of compliance.--The Corporation 
shall apply at least annually to the Nuclear Regulatory Commission for 
a certificate of compliance under paragraph (1).'' and inserting 
``Periodic application for certificate of compliance.--The Corporation 
shall apply to the Nuclear Regulatory Commission for a certificate of 
compliance under paragraph (1) periodically, as determined by the 
Nuclear Regulatory Commission, but not less than every 5 years.''.

SEC. 3042. LICENSING OF OTHER TECHNOLOGIES.

    Subsection (a) of section 1702 (42 U.S.C. 2297f-1(a)) is amended by 
striking ``other than'' and inserting ``including''.

SEC. 3043. CONFORMING AMENDMENTS.

    (a) Repeals in Atomic Energy Act of 1954 as of the Privatization 
Date.--
            (1) Repeals.--As of the privatization date (as defined in 
        section 1201(13) of the Atomic Energy Act of 1954), the 
        following sections (as in effect on such privatization date) of 
        the Atomic Energy Act of 1954 are repealed:
                    (A) Section 1202.
                    (B) Sections 1301 through 1304.
                    (C) Sections 1306 through 1316.
                    (D) Sections 1404 and 1405.
                    (E) Section 1601.
                    (F) Sections 1603 through 1607.
            (2) Conforming amendment.--The table of contents of such 
        Act is amended by repealing the items referring to sections 
        repealed by paragraph (1).
    (b) Statutory Modifications.--As of such privatization date, the 
following shall take effect:
            (1) For purposes of title I of the Atomic Energy Act of 
        1954, all references in such Act to the ``United States 
        Enrichment Corporation'' shall be deemed to be references to 
        the corporation established pursuant to section 1503 of the 
        Atomic Energy Act of 1954 (as added by section 3036(a)).
            (2) Section 1018(1) of the Energy Policy Act of 1992 (42 
        U.S.C. 2296b-7(1)) is amended by striking ``the United States'' 
        and all that follows through the period and inserting ``the 
        corporation referred to in section 1201(4) of the Atomic Energy 
        Act of 1954.''.
            (3) Section 9101(3) of title 31, United States Code, is 
        amended by striking subparagraph (N), as added by section 
        902(b) of Public Law 102-486.
    (c) Revision of Section 1305.--As of such privatization date, 
section 1305 of the Atomic Energy Act of 1954 (42 U.S.C 2297b-4) is 
amended--
            (1) by repealing subsections (a), (b), (c), and (d), and
            (2) in subsection (e)--
                    (A) by striking the subsection designation and 
                heading,
                    (B) by redesignating paragraph (1) (as added by 
                section 3038(a)) as subsection (a), striking ``In 
                general.--'' and inserting ``In General.--'', 
                redesignating subparagraphs (A) through (E) as 
                paragraphs (1) through (5) (redesignating in such 
                paragraph, clauses (i) through (iii) as subparagraphs 
                (A) through (C)), striking ``clauses (i) through 
                (iii)'' in paragraph (5) and inserting ``subparagraphs 
                (A) through (C)'', and by moving the margins 2-ems to 
                the left,
                    (C) by striking paragraph (3), and
                    (D) by redesignating paragraph (4) (as amended by 
                section 3038(b)) as subsection (b), and by moving the 
                margins 2-ems to the left.

               Subtitle D--Waste Isolation Pilot Project

SEC. 3045. SHORT TITLE AND REFERENCE.

    (a) Short Title.--This subtitle may be cited as the ``Waste 
Isolation Pilot Plant Land Withdrawal Amendment Act''.
    (b) Reference.--Except as otherwise expressly provided, whenever in 
this subtitle an amendment or repeal is expressed in terms of an 
amendment to, or repeal of, a section or other provision, the reference 
shall be considered to be made to a section or other provision of the 
Waste Isolation Pilot Plant Land Withdrawal Act (Public Law 102-579).

SEC. 3046. DEFINITIONS.

    Paragraphs (18) and (19) of section 2 are repealed.

SEC. 3047. TEST PHASE AND RETRIEVAL PLANS.

    Section 5 is repealed.

SEC. 3048. TEST PHASE ACTIVITIES.

    Section 6 is amended--
            (1) by repealing subsections (a) and (b),
            (2) by repealing paragraph (1) of subsection (c),
            (3) by repealing subparagraph (A) of paragraph (2) of 
        subsection (c),
            (4) by redesignating subsection (c) as subsection (a), by 
        striking the subsection heading and the matter before paragraph 
        (1) and inserting ``Study.--The following study shall be 
        conducted:'', by striking ``(2) Remote-handled waste.--'', by 
        striking ``(B) Study.--'', and by redesignating clauses (i), 
        (ii), and (iii) as paragraphs (1), (2), and (3), respectively, 
        and moving them 4-ems to the left, and
            (5) by redesignating subsection (d) as subsection (b).

SEC. 3049. DISPOSAL OPERATIONS.

    Section 7(b) is repealed.

SEC. 3050. ENVIRONMENTAL PROTECTION AGENCY DISPOSAL REGULATIONS.

    (a) Section 8(d)(1).--Section 8(d)(1) is amended by striking 
subparagraphs (B), (C), and (D) and by adding after subparagraph (A) 
the following:
                    ``(B) Comments of Administrator.--Within 2 months 
                of receipt of the application under subparagraph (A), 
                the Administrator shall provide the Secretary with any 
                comments on the Secretary's application. Within one 
                month of the receipt of such comments, the Secretary 
                shall, to the extent practicable, incorporate the 
                Administrator's comments in the Secretary's 
                application. The comments of the Administrator provided 
                to the Secretary should also be transmitted to the 
                appropriate committees of jurisdiction in the House of 
                Representatives and the Senate.''.
    (b) Section 8(d) (2), (3).--Section 8(d) is amended by striking 
paragraphs (2) and (3), by striking ``(1) Compliance with disposal 
regulations.--'', and by redesignating subparagraphs (A) and (B) of 
paragraph (1), as amended by subsection (a), as paragraphs (1) and (2), 
respectively, and moving them 2-ems to the left.
    (c) Section 8(f).--Subsection (f) of section 8 is amended--
            (1) by amending the subsection heading to read ``Periodic 
        Review'', and
            (2) by amending paragraph (2) to read as follows:
            ``(2) Review by the administrator.--The Administrator 
        shall, not later than 6 months after receiving a submission 
        under paragraph (1), comment on whether or not the WIPP 
        facility continues to be in compliance with the final 
        disposition regulations.''.
    (d) Section 8(g).--Section 8(g) is amended to read as follows:
    ``(g) Engineered and Natural Barriers, Etc.--The Secretary should 
determine whether or not engineered barriers or natural barriers, or 
both, will be required at WIPP consistent with regulations published as 
part 191 of 40 C.F.R.''.

SEC. 3051. COMPLIANCE WITH ENVIRONMENTAL LAWS AND REGULATIONS.

    (a) Section 9(a)(1).--Section 9(a)(1) is amended by adding after 
and below subparagraph (H) the following:
        ``With respect to transuranic mixed waste designated by the 
        Secretary for disposal at WIPP, such waste is exempt from the 
        land disposal restrictions published at part 268 of 40 C.F.R. 
        because compliance with the environmental radiation protection 
        standards published at part 191 of 40 C.F.R. renders compliance 
        with the land disposal restrictions unnecessary to achieve 
        desired environmental protection and a no migration variance is 
        not required for disposal of transuranic mixed waste at 
        WIPP.''.
    (b) Section 9(b).--Subsection (b) of section 9 is repealed.
    (c) Sections 9(c), (d).--Subsections (c) and (d) of section 9 are 
repealed.

SEC. 3052. RETRIEVABILITY.

    Section 10 is amended to read as follows:

``SEC. 10. TRANSURANIC WASTE.

    ``It is the intent of Congress that a decision will be made by the 
Secretary with respect to the disposal of transuranic waste no later 
than March 31, 1997.''.

SEC. 3053. DECOMMISSIONING OF WIPP.

    Section 13 is amended--
            (1) by repealing subsection (a), and
            (2) in subsection (b), by striking ``(b) Management Plan 
        for the Withdrawal After Decommissioning.--Within 5 years after 
        the date of the enactment of this Act, the'' and inserting 
        ``The''.

SEC. 3054. ECONOMIC ASSISTANCE AND MISCELLANEOUS PAYMENTS.

    Section 15(a) is amended--
            (1) by striking ``to the Secretary for payments to the 
        State $20,000,000 for each of the 15 fiscal years beginning 
        with the fiscal year in which the transport of transuranic 
        waste to WIPP is initiated'' and inserting ``to the State 
        $20,000,000 for each of the 15 fiscal years beginning with the 
        date of the enactment of the Waste Isolation Pilot Plant Land 
        Withdrawal Amendment Act'', and
            (2) by adding at the end the following: ``An appropriation 
        to the State shall be in addition to any appropriation for 
        WIPP.''.

SEC. 3055. NON-DEFENSE WASTE.

    Section 7(a) is amended by redesignating paragraph (3) as paragraph 
(4) and by inserting after paragraph (2) the following:
            ``(3) Nondefense waste.--Within the capacity prescribed by 
        paragraph (4), WIPP may receive transuranic waste from the 
        Secretary which did not result from a defense activity.''.

                  Subtitle E--Naval Petroleum Reserves

SEC. 3071. SHORT TITLE.

    This subtitle may be cited as the ``Naval Petroleum Reserve 
Privatization Act of 1995''.

SEC. 3072. SALE OF NAVAL PETROLEUM RESERVES.

    (a) Sale of Reserves Required.--Chapter 641 of title 10, United 
States Code, is amended by inserting after section 7421 the following 
new section:

``Sec. 7421a. Sale of naval petroleum reserves

    ``(a) Sale Required.--(1) Notwithstanding any other provision of 
this chapter, the Secretary shall sell all right, title, and interest 
of the United States in and to the lands owned or controlled by the 
United States inside the naval petroleum and oil shale reserves 
established by this chapter. In the case of Naval Petroleum Reserve 
Numbered 1, the lands to be sold shall include sections 16 and 36 of 
township 30 south, range 23 east, Mount Diablo Principal Meridian, 
California.
    ``(2) Not later than December 31, 1996, the Secretary shall enter 
into one or more contracts for the sale of all of the interest of the 
United States in the naval petroleum reserves.
    ``(b) Timing and Administration of Sale.--(1) Not later than 
January 1, 1996, the Secretary shall retain the services of five 
independent experts in the valuation of oil and gas fields to conduct 
separate assessments, in a manner consistent with commercial practices, 
of the fair market value of the interest of the United States in each 
naval petroleum reserve. In making their assessments for each naval 
petroleum reserve, the independent experts shall consider (among other 
factors) all equipment and facilities to be included in the sale, the 
net present value of the reserve, and the net present value of the 
anticipated revenue stream that the Secretary determines the Treasury 
would receive from the reserve if it were not sold, adjusted for any 
anticipated increases in tax revenues that would result if it were 
sold. The independent experts shall complete their assessments not 
later than July 1, 1996. In setting the minimum acceptable price for 
each naval petroleum reserve, the Secretary shall consider the average 
of the five assessments regarding the reserve or, if more advantageous 
to the Government, the average of three assessments after excluding the 
high and low assessments.
    ``(2) Not later than March 1, 1996, the Secretary shall retain the 
services of an investment banker to independently administer, in a 
manner consistent with commercial practices and in a manner that 
maximizes sale proceeds to the Government, the sale of the naval 
petroleum reserves under this section. The Secretary may enter into the 
contracts required under this paragraph and paragraph (1) on a 
noncompetitive basis.
    ``(3) Not later than August 1, 1996, the sales administrator 
selected under paragraph (2) shall complete a draft contract for the 
sale of each naval petroleum reserve, which shall accompany the 
invitation for bids and describe the terms and provisions of the sale 
of the interest of the United States in the reserve. Each draft 
contract shall identify all equipment and facilities to be included in 
the sales. Each draft contract, including the terms and provisions of 
the sale of the interest of the United States in the naval petroleum 
reserves, shall be subject to review and approval by the Secretary, the 
Secretary of the Treasury, and the Director of the Office of Management 
and Budget.
    ``(4) Not later than September 1, 1996, the Secretary shall publish 
an invitation for bids for the purchase of the naval petroleum 
reserves.
    ``(5) Not later than November 1, 1996, the Secretary shall accept 
the highest responsible offer for purchase of the interest of the 
United States in the naval petroleum reserves, or a particular reserve, 
that meets or exceeds the minimum acceptable price determined under 
paragraph (1). The Secretary may accept an offer for only a portion of 
a reserve so long as the entire reserve is still sold under this 
section at a price that meets or exceeds the minimum acceptable price.
    ``(c) Future Liabilities.--The United States shall hold harmless 
and fully indemnify the purchaser of the interest of the United States 
in a naval petroleum reserve from and against any claim or liability as 
a result of ownership in the reserve by the United States.
    ``(d) Special Rules Preparatory to Sale of Naval Petroleum Reserve 
Numbered 1.--(1) Not later than June 1, 1996, the Secretary shall 
finalize equity interests of the known oil and gas zones in Naval 
Petroleum Reserve Numbered 1 in the manner provided by this subsection.
    ``(2) The Secretary shall retain the services of an independent 
petroleum engineer, mutually acceptable to the equity owners, who shall 
prepare a recommendation on final equity figures. The Secretary may 
accept the recommendation of the independent petroleum engineer for 
final equity in each known oil and gas zone and establish final equity 
interest in the Naval Petroleum Reserve Numbered 1 in accordance with 
such recommendation, or the Secretary may use such other method to 
establish final equity interest in that reserve as the Secretary 
considers appropriate. The Secretary may enter into the contract 
required under this paragraph on a noncompetitive basis.
    ``(3) If, on the effective date of this section, there is an 
ongoing equity redetermination dispute between the equity owners under 
section 9(b) of the unit plan contract, such dispute shall be resolved 
in the manner provided in the unit plan contract not later than June 1, 
1996. Such resolution shall be considered final for all purposes under 
this section.
    ``(4) In this section, the term `unit plan contract' means the unit 
plan contract between equity owners of the lands within the boundaries 
of Naval Petroleum Reserve Numbered 1 (Elk Hills) entered into on June 
19, 1944.
    ``(e) Production Allocation Regarding Naval Petroleum Reserve 
Numbered 1.--(1) As part of the contract for purchase of Naval 
Petroleum Reserve Numbered 1, the purchaser of the interest of the 
United States in that reserve shall agree to make up to 25 percent of 
the purchaser's share of annual petroleum production from the purchased 
lands available for sale to small refiners, which do not have their own 
adequate sources of supply of petroleum, for processing or use only in 
their own refineries. None of the reserved production sold to small 
refiners may be resold in kind. The purchaser of that reserve may 
reduce the quantity of petroleum reserved under this subsection in the 
event of an insufficient number of qualified bids. The seller of this 
petroleum production has the right to refuse bids that are less than 
the prevailing market price of comparable oil.
    ``(2) The purchaser of Naval Petroleum Reserve Numbered 1 shall 
also agree to ensure that the terms of every sale of the purchaser's 
share of annual petroleum production from the purchased lands shall be 
so structured as to give full and equal opportunity for the acquisition 
of petroleum by all interested persons, including major and independent 
oil producers and refiners alike.
    ``(f) Maintaining Production Pending Sale of Naval Petroleum 
Reserve Numbered 1.--Until the sale of Naval Petroleum Reserve Numbered 
1 is completed under this section, the Secretary shall continue to 
produce that reserve at the maximum daily oil or gas rate from a 
reservoir, which will permit maximum economic development of the 
reservoir consistent with sound oil field engineering practices in 
accordance with section 3 of the unit plan contract. The definition of 
maximum efficient rate in section 7420(6) of this title shall not apply 
to Naval Petroleum Reserve Numbered 1.
    ``(g) Effect on Existing Contracts.--(1) In the case of any 
contract, in effect on the effective date of this section, for the 
purchase of production from any part of the United States' share of the 
naval petroleum reserves, the sale of the interest of the United States 
in the reserves shall be subject to the contract for a period of three 
months after the closing date of the sale or until termination of the 
contract, whichever occurs first. The term of any contract entered into 
after the effective date of this section for the purchase of such 
production shall not exceed the anticipated closing date for the sale 
of the reserve.
    ``(2) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in the 
contract between the United States and Bechtel Petroleum Operation, 
Inc., Contract Number DE-ACO1-85FE60520 so that the contract terminates 
not later than the date of closing of the sale of that reserve.
    ``(3) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in the 
unit plan contract so that the unit plan contract terminates not later 
than the date of closing of the sale of that reserve.
    ``(h) Set Aside of Sale Proceeds on Account of California Claims 
Regarding Naval Petroleum Reserve Numbered 1.--(1) An amount equal to 
seven percent of the proceeds from the sale of Naval Petroleum Reserve 
Numbered 1 shall be retained in a special account in the Treasury for 
the purpose of paying any amount that may be owed by the United States 
as a result of legal action in connection with claims against the 
United States by the State of California and the Teachers' Retirement 
Fund of the State of California with respect to lands within Naval 
Petroleum Reserve Numbered 1, including sections 16 and 36 of township 
30 south, range 23 east, Mount Diablo Principal Meridian, California, 
or production or proceeds of sale from that reserve.
    ``(2) In determining the amount of the proceeds arising from the 
sale of Naval Petroleum Reserve Numbered 1, the Secretary shall deduct 
the costs incurred to conduct the sale of that reserve.
    ``(3) A payment may be made from the special account only to the 
extent that the aggregate amount of such payment is provided for in 
advance in an appropriations Act.
    ``(i) Effect on Antitrust Laws.--Nothing in this section shall be 
construed to alter the application of the antitrust laws of the United 
States to the purchaser of a naval petroleum reserve or to the lands in 
the naval petroleum reserves subject to sale under this section upon 
the completion of the sale.
    ``(j) Preservation of Private Right, Title, and Interest.--Nothing 
in this section shall be construed to adversely affect the ownership 
interest of any other entity having any right, title, and interest in 
and to lands within the boundaries of the naval petroleum reserves.
    ``(k) Congressional Notification.--Section 7431 of this title shall 
not apply to the sale of the naval petroleum reserves under this 
section. However, the Secretary may not enter into a contract for the 
sale of a naval petroleum reserve until the end of the 15-day period 
beginning on the date on which the Secretary notifies the Committee on 
Armed Services of the Senate and the Committee on National Security and 
the Committee on Commerce of the House of Representatives that the 
Secretary has accepted an offer under subsection (b)(5) for the sale of 
that reserve.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
7421 the following new item:

``7421a. Sale of naval petroleum reserves.''.

     TITLE IV--COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES

SEC. 4000. TABLE OF CONTENTS.

    The table of contents for this title is as follows:

     TITLE IV--COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES

                      Subtitle A--Higher Education

Sec. 4001. Short title; effective date.
Sec. 4002. Termination of direct lending.
Sec. 4003. Elimination of grace period interest subsidies.
Sec. 4004. Plus program reductions.
Sec. 4005. Loan transfer fee.
Sec. 4006. Lender fees to guaranty agencies.
Sec. 4007. Additional loan program changes.
Sec. 4008. Use of reserve funds to purchase defaulted loans.
Sec. 4009. Extension of period a guaranty agency must hold a defaulted 
loan.
Sec. 4010. Privatization of College Construction Loan Insurance 
Association.
Sec. 4011. Eligible institution.
Sec. 4012. Extension of program duration.

          Subtitle B--Davis-Bacon and Service Contract Repeals

Sec. 4101. Davis-Bacon Act.
Sec. 4102. Service Contract Act of 1965.

   Subtitle C--Provisions Relating to the Employee Retirement Income 
                          Security Act of 1974

Sec. 4201. Waiver of minimum period for joint and survivor annuity 
explanation before annuity starting date.

                      Subtitle A--Higher Education

SEC. 4001. SHORT TITLE; EFFECTIVE DATE.

    (a) Short Title.--This subtitle may be cited as the ``Higher 
Education Program Efficiency Act of 1995''.
    (b) Effective Date.--Except as otherwise provided therein, the 
amendments made by this subtitle shall take effect on January 1, 1996.

SEC. 4002. TERMINATION OF DIRECT LENDING.

    (a) Termination of Authority.--
            (1) Program authority.--Section 451(a) of the Higher 
        Education Act of 1965 (20 U.S.C. 1087a(a)) is amended by 
        inserting ``and ending June 30, 1996'' after ``period beginning 
        July 1, 1994''.
            (2) Termination of funding.--Section 452 of such Act (20 
        U.S.C. 1087b) is amended by adding at the end the following new 
        subsection:
    ``(e) Termination of Funding.--The Secretary shall not provide 
funds under this section for loans for any academic year beginning on 
or after July 1, 1996. The Secretary shall not pay any fees pursuant to 
subsection (b) of this section on or after January 1, 1996.''.
            (3) Termination of authority to enter new agreements.--
        Section 453(a) of such Act (20 U.S.C. 1087c(a)) is amended--
                    (A) in paragraph (1), by inserting ``and ending 
                before July 1, 1996'' after ``academic years beginning 
                on or after July 1, 1994'';
                    (B) in paragraph (2)--
                            (i) by inserting ``and'' after the 
                        semicolon at the end of subparagraph (A);
                            (ii) by striking the semicolon at the end 
                        of subparagraph (B) and inserting a period; and
                            (iii) by striking subparagraphs (C) and 
                        (D); and
                    (C) by striking paragraph (3) and redesignating 
                paragraph (4) as paragraph (3).
    (b) Administrative Cost Amendments.--Section 458 of such Act (20 
U.S.C. 1087h) of such Act is amended--
            (1) by striking subsection (d);
            (2) by redesignating subsections (b) and (c) as subsections 
        (f) and (g), respectively; and
            (3) by striking subsection (a) and inserting the following:
    ``(a) In General.--
            ``(1) Direct administrative costs.--Each fiscal year there 
        shall be available to the Secretary of Education, from funds 
        not otherwise appropriated, funds to be obligated for the 
        subsidy costs of direct administrative costs under this part, 
        subject to subsection (b) of this section.
            ``(2) Indirect administrative costs.--There shall also be 
        available from funds available from funds not otherwise 
        appropriated, funds to be obligated for indirect administrative 
        costs under this part and part B, subject to subsection (c) of 
        this section, not to exceed (from such funds not otherwise 
        appropriated) $260,000,000 in fiscal year 1994, $345,000,000 in 
        fiscal year 1995, $110,000,000 in fiscal year 1996 (of which 
        $40,000,000 shall be available for administrative cost 
        allowances for guaranty agencies for October through December 
        of 1995), and $70,000,000 in each of the fiscal years 1997 
        through 2002.
            ``(3) Reduction.--The amount authorized to be made 
        available for fiscal year 1997 under paragraph (2) shall be 
        reduced by the amount of any unobligated unexpended funds 
        available to carry out this subsection for any fiscal year 
        prior to fiscal year 1996.
    ``(b) Subsidy Costs.--For purposes of this section, `subsidy cost' 
means the estimated long-term cost to the Federal Government of direct 
administrative expenses calculated on a net present value basis.
    ``(c) Direct Administrative Expenses.--For purposes of this 
section, `direct administrative expenses' shall consist of the cost 
of--
            ``(1) activities related to credit extension, loan 
        origination, loan servicing, management of contractors, and 
        payments to contractors, other government entities, and program 
        participants;
            ``(2) collection of delinquent loans; and
            ``(3) write-off and closeout of loans.
    ``(d) Indirect Administrative Expenses.--For purposes of this 
section, `indirect administrative expenses' shall consist of the cost 
of--
            ``(1) personnel engaged in developing program regulations, 
        policy, and administrative guidelines;
            ``(2) audits of institutions and contractors;
            ``(3) program reviews; and
            ``(4) other oversight of the program.
    ``(e) Limitation on Part D Expenditures.--For any fiscal year, 
expenditures for indirect administrative expenses and for loan 
servicing for loans made pursuant to this part shall not exceed 30 
percent of funds available pursuant to paragraph (2) for such fiscal 
year.''.
    (c) Elimination of Transition to Direct Loans.--Such Act is further 
amended--
            (1) in section 422(c)(7) (20 U.S.C. 1072(c)(7))--
                    (A) by striking ``during the transition'' and all 
                that follows through ``part D of this title'' in 
                subparagraph (A); and
                    (B) by striking ``section 428(c)(10)(F)(v)'' in 
                subparagraph (B) and inserting ``section 
                428(c)(9)(F)(v)'';
            (2) in section 428(c)(8) (20 U.S.C. 1078(c)(8)), by 
        striking subparagraph (B) and inserting the following:
            ``(B) Prior to making such determination for any guaranty 
        agency, the Secretary shall, in consultation with the guaranty 
        agency, develop criteria to determine whether such guaranty 
        agency has made adequate collection efforts. In determining 
        whether a guaranty agency's collection efforts have met such 
        criteria, the Secretary shall consider the agency's record of 
        success in collecting on defaulted loans, the age of the loans, 
        and the amount of recent payments received on the loans.'';
            (3) in section 428(c)(9)(E)--
                    (A) by inserting ``or'' after the semicolon at the 
                end of clause (iv);
                    (B) by striking ``; or'' at the end of clause (v) 
                and inserting a period; and
                    (C) by striking clause (vi);
            (4) in clause (vii) of section 428(c)(9)(F)--
                    (A) by inserting ``and'' before ``to avoid 
                disruption''; and
                    (B) by striking ``, and to ensure an orderly 
                transition'' and all that follows through the end of 
                such clause and inserting a period;
            (5) in section 428(c)(9)(K), by striking ``the progress of 
        the transition from the loan programs under this part to'' and 
        inserting ``the integrity and administration of'';
            (6) in section 428(e)(1)(B)(ii), by striking ``during the 
        transition'' and all that follows through ``part D of this 
        title'';
            (7) in section 428(e)(3), by striking ``of transition'';
            (8) in section 428(j)(3)--
                    (A) by striking ``during transition to direct 
                lending''; and
                    (B) by striking ``during the transition'' and all 
                that follows through ``part D of this title,'' in 
                subparagraph (A) and inserting a comma;
            (9) in section 453(c)(2) (20 U.S.C. 1087c(c)(2)), by 
        striking ``Transition'' and inserting ``Institutional'';
            (10) in section 453(c), by striking paragraph (3); and
            (11) in section 456(b) (20 U.S.C. 1087f(b))--
                    (A) by inserting ``and'' after the semicolon at the 
                end of paragraph (3);
                    (B) by striking paragraph (4);
                    (C) by redesignating paragraph (5) as paragraph 
                (4); and
                    (D) in such paragraph (4) (as redesignated), by 
                striking ``successful operation'' and inserting 
                ``integrity and efficiency''.
    (d) Additional Conforming Amendments.--
            (1) Ability of part d borrowers to obtain federal stafford 
        consolidation loans.--Section 428C(a)(4) of such Act (20 U.S.C. 
        1078-3(a)(4)) is amended--
                    (A) by redesignating subparagraphs (C) and (D) as 
                subparagraphs (D) and (E); and
                    (B) by inserting after subparagraph (B) the 
                following new subparagraph:
                    ``(C) made under part D of this title;''.
            (2) Conforming amendments.--Section 428C(b) of such Act (20 
        U.S.C. 1078-3(b)) is amended by striking paragraph (5).

SEC. 4003. ELIMINATION OF GRACE PERIOD INTEREST SUBSIDIES.

    Section 428(a)(3) of the Higher Education Act of 1965 (20 U.S.C. 
1078(a)(3)) is amended by adding at the end the following new 
subparagraph:
            ``(C) Notwithstanding subparagraph (A), no portion of the 
        interest which accrues after the student ceases to carry at an 
        eligible institution at least one-half the normal full-time 
        academic workload (as determined by the institution) and prior 
        to the beginning of the repayment period of the loan shall be 
        paid by the Secretary under this subsection on any loan made on 
        or after January 1, 1996. Interest on the unpaid principal 
        amount of any such loan during the interval described in the 
        preceding sentence shall, at the option of the borrower--
                    ``(i) be paid monthly or quarterly, or
                    ``(ii) be added by the lender to the principal 
                amount of the loan at the commencement of the repayment 
                period.''.

SEC. 4004. PLUS PROGRAM REDUCTIONS.

    (a) Loan Limits.--Section 428B(b) of the Higher Education Act of 
1965 (20 U.S.C. 1078-2(b)) is amended--
            (1) by striking ``(b) Limitation Based on Need.--'' and 
        inserting the following:
    ``(b) Annual Limits.--
            ``(1) Limitation based on need.--'';
            (2) by inserting before the last sentence thereof the 
        following:
            ``(3) Limitation computed on basis of actual payments.--''; 
        and
            (3) by inserting before paragraph (3) (as designated by the 
        amendment made by paragraph (2) of this subsection) the 
        following new paragraph:
            ``(2) Dollar limitation.--Subject to paragraph (1), the 
        maximum amount parents may borrow for one student in any 
        academic year or its equivalent (as defined by regulations of 
        the Secretary) is $15,000.''.
    (b) Interest Rebate.--Section 428B of such Act is further amended 
by adding at the end the following new subsection:
    ``(f) Interest Rebate.--
            ``(1) Rebate required.--Each holder of a loan under this 
        section made on or after the date of enactment of this 
        subsection, shall pay, on June 30 and December 31 of each year, 
        to the Secretary a rebate of subsidies in an amount equal to 
        0.8 percent of the outstanding principal balance of loans held 
        on such date. Payment of such rebate shall be made not later 
        than 60 days after each such date.
            ``(2) Deposit of rebates.--The Secretary shall deposit all 
        fees collected pursuant to paragraph (1) into the insurance 
        fund established in section 431.''.
    (c) Plus Loans Interest Rates.--Section 427A(c)(4) of such Act (20 
U.S.C. 1077a(c)(4)) is amended by adding at the end the following new 
subparagraph:
            ``(F) Notwithstanding subparagraphs (A), (D), and (E), for 
        any loan made pursuant to section 428B for which the first 
        disbursement is made on or after January 1, 1996--
                    ``(i) subparagraph (B) shall be applied by 
                substituting `4.0' for `3.25'; and
                    ``(ii) the interest rate shall not exceed 11 
                percent.''.
    (d) Conforming Amendment.--Section 427A(h) of such Act (20 U.S.C. 
1077a(h)) is amended--
            (1) by striking paragraph (2); and
            (2) by redesignating paragraph (3) as paragraph (2).

SEC. 4005. LOAN TRANSFER FEE.

    Section 428(b)(2) of the Higher Education Act of 1965 (20 U.S.C. 
1078(b)(2)) is amended--
            (1) by striking ``and'' at the end of subparagraph (E);
            (2) by striking the period at the end of subparagraph (F) 
        and inserting ``; and''; and
            (3) by adding at the end thereof the following new 
        subparagraph:
                    ``(G) provide that, if a lender or holder, on or 
                after January 1, 1996, sells, transfers, or assigns a 
                loan under this part, then the transferee shall pay to 
                the Secretary a transfer fee in an amount equal to 0.20 
                percent of the principal of the loan, which transfer 
                fee shall be deposited into the insurance fund 
                established in section 431, except that the provisions 
                of this subparagraph shall not apply to any such sale, 
                transfer, or assignment by a lender or holder to such 
                lender's or holder's affiliate or pursuant to a merger 
                or other consolidation transaction.''.

SEC. 4006. LENDER FEES TO GUARANTY AGENCIES.

    Subsection (f) of section 428 of the Higher Education Act of 1965 
(20 U.S.C. 1078(f)) is amended to read as follows:
    ``(f) Payments of Certain Costs.--
            ``(1) Payments from lenders.--With respect to any loan 
        under this part for which the first disbursement is made on or 
        after January 1, 1996, the originating lender shall remit to 
        the guaranty agency which guarantees the loan, a fee equal to 
        0.70 percent of the principal amount of the loan.
            ``(2) Use of payments.--Payments made pursuant to paragraph 
        (1) shall be used for the purposes of--
                    ``(A) the administrative costs of collections of 
                loans;
                    ``(B) the administrative costs of preclaim 
                assistance and other predefault activities;
                    ``(C) the administrative costs of monitoring the 
                enrollment and repayment status of students; and
                    ``(D) other such costs related to the student loan 
                insurance program.
            ``(3) Timing of payments.--Payments made pursuant to 
        paragraph (1) shall be made at the time insurance premiums on 
        such loans are paid to the guaranty agency.
            ``(4) Prohibition on pass-through.--No part of any payments 
        required by this section shall be assessed or collected, 
        directly or indirectly, from any borrower under this part.''.

SEC. 4007. ADDITIONAL LOAN PROGRAM CHANGES.

    (a) Reserve Funds.--
            (1) Amendments to section 422.--Section 422 of the Higher 
        Education Act of 1965 (20 U.S.C. 1072) is amended--
                    (A) in the last sentence of subsection (a)(2), by 
                striking ``Except as provided in section 428(c)(10)(E) 
                or (F), such unencumbered'' and inserting ``Such'';
                    (B) in subsection (g)(1), by striking ``or the 
                program authorized by part D of this title'' each place 
                it appears;
                    (C) in subsection (g)(1)(D), by striking ``(A) or 
                (B)'' and inserting ``(A), (B), or (C)''; and
                    (D) in subsection (g), by striking paragraph (4) 
                and inserting the following:
            ``(4) Disposition of funds returned to or recovered by the 
        secretary.--Any funds that are returned to or otherwise 
        recovered by the Secretary pursuant to this subsection shall be 
        returned to the Treasury of the United States for purposes of 
        reducing the Federal debt and shall be deposited into the 
        special account under section 3113(d) of title 31, United 
        States Code.''.
            (2) Amendments to section 428.--Section 428(c)(9)(A) of 
        such Act (20 U.S.C. 1078(c)(9)(A)) is amended--
                    (A) by inserting ``and'' after the semicolon at the 
                end of clause (i);
                    (B) by striking ``; and'' at the end of clause (ii) 
                and inserting a period; and
                    (C) by striking clause (iii).
    (b) Application for Part B Loans Using Free Federal Application.--
            (1) Single form required.--Section 483(a) of such Act (20 
        U.S.C. 1090(a)) is amended--
                    (A) in paragraph (1)--
                            (i) by inserting ``B,'' after ``assistance 
                        under parts A,'';
                            (ii) by striking ``and to determine the 
                        need of a student for the purpose of part B of 
                        this title''; and
                            (iii) by striking the last sentence and 
                        inserting the following: ``Such form may be in 
                        an electronic or any other format (subject to 
                        section 485B) in order to facilitate use by 
                        borrowers and institutions.''; and
                    (B) in paragraph (3), by striking ``and States 
                shall receive,'' and inserting ``, any guaranty agency 
                authorized by any such institution, and States shall 
                receive, at their request and''.
            (2) Use of electronic forms.--Section 483(a) of such Act is 
        further amended by adding the following new paragraph after 
        paragraph (4):
            ``(5) Electronic forms.--(A) The Secretary, in cooperation 
        with representatives of institutions of higher education, 
        eligible lenders, and guaranty agencies, shall prescribe an 
        electronic version of the form described in subsection (a)(1). 
        Such electronic form shall not require signatures to be 
        collected at the time such form is submitted if the data 
        contained in the electronic form is certified in one or more 
        separate writings. The Secretary shall prescribe the initial 
        electronic form not later than 90 days after the date of 
        enactment of this paragraph.
            ``(B) Nothing in this Act shall preclude the use of the 
        electronic form prescribed under subparagraph (A) through 
        software developed, produced, distributed (including by 
        diskette, modem or network communication, or otherwise) or 
        collected by eligible lenders, guaranty agencies, eligible 
        institutions, or consortia thereof. Such organization or 
        consortium shall submit such electronic form to the Secretary 
        for review prior to its use. If such electronic form is 
        inconsistent with the provisions of this part, the Secretary 
        shall notify the submitting organization or consortium of his 
        objection within 30 days of such submission, and shall 
        specifically identify the necessary changes. In the absence of 
        such an objection the organization or consortium may use the 
        electronic form as submitted. No fee may be charged in 
        connection with use of the electronic form, or of any other 
        electronic forms used in conjunction with such form in applying 
        for Federal or State student financial assistance.''.
    (c) Amendments to Eligible Lender Definition.--Section 435(d)(1) of 
such Act (20 U.S.C. 1085) is amended--
            (1) by inserting before the semicolon at the end of 
        subparagraph (A) the following: ``; and in determining whether 
        the making or holding of loans to students and parents under 
        this part is the primary consumer credit function of the 
        eligible lender, loans made or held as trustee or in a trust 
        capacity for the benefit of a third party shall not be 
        considered'';
            (2) by striking ``and'' at the end of subparagraph (I);
            (3) in subparagraph (J), by striking the period and 
        inserting ``; and''; and
            (4) by adding at the end the following new subparagraph:
                    ``(K) a wholly owned subsidiary of a publicly-held 
                holding company which, as of the date of enactment of 
                this subparagraph, through one or more subsidiaries (i) 
                acts as a finance company, and (ii) participates in the 
                program authorized by this part pursuant to 
                subparagraph (C).''.
    (d) Additional Amendments to Section 428.--
            (1) Amendments.--Section 428 of such Act is further 
        amended--
                    (A) in subsection (b)(1)(G), by striking ``98 
                percent'' and inserting ``95 percent'';
                    (B) in subsection (b)(1)(X), by striking ``section 
                428(c)(10)'' and inserting ``section 428(c)(9)'';
                    (C) in subsection (c)(1)(A), by striking ``98 
                percent'' and inserting ``96 percent'';
                    (D) in subsection (c)(1)(B)(i), by striking ``88 
                percent'' and inserting ``86 percent'';
                    (E) in subsection (c)(1)(B)(ii), by striking ``78 
                percent'' and inserting ``76 percent'';
                    (F) in subsection (c)(9)(C)(ii), by striking ``80 
                percent'' and inserting ``76 percent'';
                    (G) in subsection (c)(9)(I) by inserting ``on the 
                record'' after ``for a hearing'';
                    (H) in subsection (j)(2)(A), by striking ``60'' and 
                inserting ``15'';
                    (I) in subsection (j)(2)(B), by striking ``two 
                rejections'' and inserting ``one rejection''; and
                    (J) in subsection (l)--
                            (i) by striking paragraph (2); and
                            (ii) by striking ``(1) Assistance 
                        required.--''.
            (2) Effective date.--The amendments made by paragraph (1) 
        of this subsection shall apply to loans on which the first 
        disbursement of principal is made on or after January 1, 1996.
    (e) Reinsurance Percentage Under Section 428I.--Section 428I of 
such Act (20 U.S.C. 1078-9) is amended in subsection (b)(1)--
            (1) by striking ``100 percent'' in the heading and 
        inserting ``95 percent''; and
            (2) by striking ``100 percent'' and inserting ``95 
        percent''.
    (f) Loan Fees From Lenders.--Section 438(d)(2) of such Act (20 
U.S.C. 1087-1(d)(2)) is amended to read as follows:
            ``(2) Amount of loan fees.--The amount of the loan fee 
        which shall be deducted under paragraph (1) shall be--
                    ``(A) 0.50 percent of the principal amount of the 
                loan, for any loan under this part for which the first 
                disbursement was made on or after October 1, 1993, and 
                before January 1, 1996; or
                    ``(B) 0.30 percent of the principal amount of the 
                loan, for any loan under this part for which the first 
                disbursement was made on or after January 1, 1996.''.
    (g) Small Lender Audit Exemption.--Section 428(b)(1)(U)(iii) of 
such Act (20 U.S.C. 1078(b)(1)(U)(iii)) is amended--
            (1) by inserting ``in the case of any lender that 
        originates or holds more than $5,000,000 in principal on loans 
        made under this title in any fiscal year,'' before ``for (I)'';
            (2) by inserting ``such'' before ``lender at least once'';
            (3) by inserting ``such'' before ``a lender that is 
        audited''; and
            (4) by striking ``if the lender'' and inserting ``if such 
        lender''.

SEC. 4008. USE OF RESERVE FUNDS TO PURCHASE DEFAULTED LOANS.

    Section 422 of the Higher Education Act of 1965 (20 U.S.C. 1072) is 
amended by adding at the end the following new subsection:
    ``(h) Use of Reserve Funds to Purchase Defaulted Loans.--
            ``(1) In general.--Except as provided in paragraph (2), a 
        guaranty agency shall use not less than 50 percent of such 
        agency's reserve funds to purchase and hold defaulted loans 
        that are guaranteed by such agency and for which a claim for 
        insurance is filed with such agency by an eligible lender after 
        the date of enactment of this subsection. The amount of such 
        purchases shall be considered as reserve funds under this 
        section and used in the calculation of the minimum reserve 
        level under section 428(c)(9).
            ``(2) Special rule.--A guaranty agency shall not be 
        required to use its reserve funds to purchase and hold 
        defaulted loans in accordance with paragraph (1) to the extent 
        that--
                    ``(A) the dollar volume of insurance claims filed 
                with such agency does not amount to 50 percent of such 
                agency's available reserve funds; or
                    ``(B) such use is prohibited by State law; or
                    ``(C) such use will compromise the ability of the 
                guaranty agency to pay program expenses.''.

SEC. 4009. EXTENSION OF PERIOD A GUARANTY AGENCY MUST HOLD A DEFAULTED 
                    LOAN.

    (a) Exemption for Extended Holding Period.--The last sentence of 
section 428(c)(1)(A) of the Higher Education Act of 1965 (20 U.S.C. 
1078(c)(1)(A)) is amended by striking out ``A guaranty agency'' and 
inserting ``Except as provided in section 428K, a guaranty agency''.
    (b) New Extended Holding Period Program.--Part B of title IV of 
such Act (20 U.S.C. 1071 et seq.) is amended by inserting after section 
428J the following new section:

``SEC. 428K. GUARANTOR PURCHASE OF CLAIMS WITH RESERVE FUNDS.

    ``(a) Loans Subject to Extended Holding Period.--Except as provided 
in subsection (b), a guaranty agency shall file a claim for 
reimbursement with respect to losses (resulting from the default of a 
student borrower) subject to reimbursement by the Secretary pursuant to 
section 428(c)(1) not less than 180 days nor more than 225 days after 
the guaranty agency discharges such agency's insurance obligation on a 
loan insured under this part. Such claim shall include losses on the 
unpaid principal and accrued interest of any such loan, including 
interest accrued from the date of such discharge to the date such 
agency files the claim for reimbursement from the Secretary.
    ``(b) Loans Excluded From Extended Holding.--A guaranty agency may 
file a claim with respect to losses subject to reimbursement by the 
Secretary pursuant to section 428(c)(1) prior to 180 days after the 
date the guaranty agency discharges such agency's insurance obligation 
on a loan insured under this part, if--
            ``(1) such agency used 50 percent or more of such agency's 
        reserve funds to purchase or hold loans in accordance with 
        section 422(h);
            ``(2) such claim is based on an inability to locate the 
        borrower and the guaranty agency certifies to the Secretary 
        that--
                    ``(A) diligent attempts were made to locate the 
                borrower through the use of reasonable skip-tracing 
                techniques in accordance with section 428(c)(2)(G); and
                    ``(B) such skip-tracing attempts to locate the 
                borrower were unsuccessful; or
            ``(3) the guaranty agency determines that the borrower is 
        unlikely to possess the financial resources to begin repaying 
        the loan prior to 180 days after default by the borrower.
    ``(c) Guaranty Agency Efforts During Extended Holding Period.--A 
guaranty agency shall attempt to bring a loan described in subsection 
(a) into repayment status prior to 180 days after the date the guaranty 
agency discharges its insurance obligation on the loan, so that no 
claim for reimbursement by the Secretary is necessary. Upon securing 
payment satisfactory to the guaranty agency during the 180-day period, 
such agency shall, if practicable, sell such loan to an eligible 
lender. Such loan shall not be sold to an eligible lender that the 
guaranty agency determines has substantially failed to exercise the due 
diligence required of lenders under this part.
    ``(d) Regulation Prohibited.--The Secretary shall not regulate the 
collection activities of a guaranty agency with respect to a loan 
described in subsection (a) for which reinsurance has not been paid 
under section 428(c)(1).''.

SEC. 4010. PRIVATIZATION OF COLLEGE CONSTRUCTION LOAN INSURANCE 
                    ASSOCIATION.

    (a) Repeal of Statutory Restrictions.--Part D of title VII of the 
Higher Education Act of 1965 (20 U.S.C. 1132f et seq.) is repealed.
    (b) Status of the Corporation.--
            (1) Status of the corporation.--The Corporation shall not 
        be an agency, instrumentality, or establishment of the United 
        States Government and shall not be a ``Government corporation'' 
        nor a ``Government controlled corporation'' as defined in 
        section 103 of title 5, United States Code. No action under 
        section 1491 of title 28, United States Code (commonly known as 
        the Tucker Act) shall be allowable against the United States 
        based on the actions of the Corporation.
            (2) Corporate powers.--The Corporation shall have the power 
        to engage in any business or other activities for which 
        corporations may be organized under the laws of any State of 
        the United States or the District of Columbia. The Corporation 
        shall have the power to enter into contracts, to execute 
        instruments, to incur liabilities, to provide products and 
        services, and to do all things as are necessary or incidental 
        to the proper management of its affairs and the efficient 
        operation of a private, for-profit business.
            (3) Limitation on ownership of stock.--Except as provided 
        in subsection (d)(2) of this section, no stock of the 
        Corporation may be sold or issued to an agency, 
        instrumentality, or establishment of the United States 
        Government, to a Government corporation or a Government 
        controlled corporation (as such terms are defined in section 
        103 of title 5, United States Code), or to a Government 
        sponsored enterprise (as such term is defined in section 622 of 
        title 2, United States Code). The Student Loan Marketing 
        Association shall not own any stock of the Corporation, except 
        that it may retain the stock it owns on the date of enactment. 
        The Student Loan Marketing Association shall not control the 
        operation of the Corporation, except that the Student Loan 
        Marketing Association may participate in the election of 
        directors as a shareholder, and may continue to exercise its 
        right to appoint directors under section 754 of the Higher 
        Education Act of 1965 as long as that section is in effect. The 
        Student Loan Marketing Association shall not provide financial 
        support or guarantees to the Corporation. Notwithstanding the 
        prohibitions in this subsection, the United States may pursue 
        any remedy against a holder of the Corporation's stock to which 
        it would otherwise be entitled.
    (c) Related Privatization Requirements.--
            (1) Notice requirements.--During the 5-year period 
        following the date of the enactment of this Act, the 
        Corporation shall include in any document offering the 
        Corporation's securities, in any contracts for insurance, 
        guarantee, or reinsurance of obligations, and in any 
        advertisement or promotional material, a statement that--
                    (A) the Corporation is not a Government-sponsored 
                enterprise or instrumentality of the United States; and
                    (B) the Corporation's obligations are not 
                guaranteed by the full faith and credit of the United 
                States.
            (2) Corporate charter.--The Corporation's charter shall be 
        amended as necessary and without delay to conform the 
        requirements of this Act.
            (3) Corporate name.--The name of the Corporation, or of any 
        direct or indirect subsidiary thereof, may not contain the term 
        ``College Construction Loan Insurance Association''.
            (4) Articles of incorporation.--The Corporation shall amend 
        its articles of incorporation without delay to reflect that one 
        of the purposes of the Corporation shall be to guarantee, 
        insure and reinsure bonds, leases, and other evidences of debt 
        of educational institutions, including Historically Black 
        Colleges and Universities and other academic institutions which 
        are ranked in the lower investment grade category using a 
        nationally recognized credit rating system.
            (5) Transition requirements.--
                    (A) Requirements until stock sale.--Notwithstanding 
                subsection (a), the requirements of section 754 of the 
                Higher Education Act of 1965 (20 U.S.C. 1132f-3), as in 
                existence as of the day before enactment of this Act, 
                shall continue to be effective until the day 
                immediately following the date of closing of the 
                purchase of the Secretary's stock (or the date of 
                closing of the final purchase, in the case of multiple 
                transactions) pursuant to subsection (d) of this 
                section.
                    (B) Reports after stock sale.--The Corporation 
                shall, not later than March 30 of the first full 
                calendar year immediately following the sale pursuant 
                to subsection (d), and each of the 2 succeeding years, 
                submit to the Secretary of Education a report 
                describing the Corporation's efforts to assist in the 
                financing of education facilities projects, including 
                projects for elementary, secondary, and postsecondary 
                educational institution infrastructure, and detailing, 
                on a project-by-project basis, the Corporation's 
                business dealings with educational institutions that 
                are rated by a nationally recognized statistical rating 
                organization at or below the organization's third 
                highest ratings.
    (d) Sale of Federally Owned Stock.--
            (1) Sale of stock required.--The Secretary of the Treasury 
        shall make every effort to sell, pursuant to section 324 of 
        title 31, United States Code, the stock of the Corporation 
        owned by the Secretary of Education not later than 6 months 
        after the date of the enactment of this Act.
            (2) Purchase by the corporation.--In the event that the 
        Secretary of the Treasury is unable to sell the stock, or any 
        portion thereof, at a price acceptable to the Secretary of 
        Education and the Secretary of the Treasury, the Corporation 
        shall purchase, within the period specified in paragraph (1), 
        such stock at a price determined by the Secretary of the 
        Treasury and acceptable to the Corporation based on independent 
        appraisal by one or more nationally recognized financial firms, 
        except that such price shall not exceed the value of the 
        Secretary's stock as determined by the Congressional Budget 
        Office in House Report 104-153, dated June 22, 1995. Such firms 
        shall be selected by the Secretary of the Treasury in 
        consultation with the Secretary of Education and the 
        Corporation.
    (e) Assistance by the Corporation.--The Corporation shall provide 
such assistance as the Secretary of the Treasury and the Secretary of 
Education may require to facilitate the sale of the stock under this 
section.
    (f) Definition.--As used in this section, the term ``Corporation'' 
means the Corporation established pursuant to the provision of law 
repealed by subsection (a).

SEC. 4011. ELIGIBLE INSTITUTION.

    (a) Amendments.--Section 481(b) of the Higher Education Act of 1965 
(20 U.S.C. 1088(b)) is amended--
            (1) by inserting before the period at the end of the first 
        sentence the following: ``on the basis of a review by the 
        institution's independent auditor using generally accepted 
        accounting principles''; and
            (2) by inserting after the end of such first sentence the 
        following new sentences: ``For the purposes of clause (6), 
        revenues from sources that are not derived from funds provided 
        under this title include revenues from programs of education or 
        training that do not meet the definition of an eligible program 
        in subsection (e), but are provided on a contractual basis 
        under Federal, State, or local training programs, or to 
        business and industry. For the purposes of determining whether 
        an institution meets the requirements of clause (6), the 
        Secretary shall not consider the financial information of any 
        institution for a fiscal year began on or before April 30, 
        1994.''.
    (b) Effective Date.--Notwithstanding section 713 of this Act, the 
amendments made by subsection (a) shall apply to any determination made 
on or after July 1, 1994, by the Secretary of Education pursuant to 
section 481(b)(6) of the Higher Education Act of 1965.

SEC. 4012. EXTENSION OF PROGRAM DURATION.

    Part B of title IV of the Higher Education Act of 1965 is amended--
            (1) in section 424(a) (20 U.S.C. 1074(a)), by striking 
        ``1998'' and inserting ``2002'';
            (2) in section 428(a)(5) (20 U.S.C. 1078(a)(5))--
                    (A) by striking ``2002'' and inserting ``2006''; 
                and
                    (B) by striking ``1998'' and inserting ``2002''; 
                and
            (3) in section 428C(e) (20 U.S.C. 1078-3(e)), by striking 
        the first sentence and inserting ``The authority to make loans 
        under this section expires at the close of September 30, 
        2002.''.

          Subtitle B--Davis-Bacon and Service Contract Repeals

SEC. 4101. DAVIS-BACON ACT.

    (a) Repeal.--The Act of March 3, 1931 (40 U.S.C. 276a et seq.) 
(commonly referred to as the Davis-Bacon Act) is repealed.
    (b) References.--Any reference in any law to a wage requirement of 
the Act of March 3, 1931, shall, 45 days after the date of the 
enactment of this Act, be null and void.
    (c) Effective Date.--The amendment made by subsection (a) shall 
take effect 45 days after the date of the enactment of this Act but 
shall not affect any contract in existence on the expiration of such 
days or made pursuant to an invitation for bids outstanding on the 
expiration of such days.

SEC. 4102. SERVICE CONTRACT ACT OF 1965.

    (a) Repeal.--The Service Contract Act of 1965 (41 U.S.C. 351 et 
seq.) is repealed.
    (b) Application.--The amendment made by subsection (a) shall not 
apply to a contract which was entered into before the 45th day after 
the date of the enactment of this Act and to which the Service Contract 
Act of 1965 applied.

   Subtitle C--Provisions Relating to the Employee Retirement Income 
                          Security Act of 1974

SEC. 4201. WAIVER OF MINIMUM PERIOD FOR JOINT AND SURVIVOR ANNUITY 
                    EXPLANATION BEFORE ANNUITY STARTING DATE.

    (a) General Rule.--For purposes of section 205(c)(3)(A) of the 
Employee Retirement Income Security Act of 1974 (29 U.S.C. 
1055(c)(3)(A)), the minimum period prescribed by the Secretary of the 
Treasury between the date that the explanation referred to in such 
section is provided and the annuity starting date shall not apply if 
waived by the participant and, if applicable, the participant's spouse.
    (b) Effective Date.--Subsection (a) shall apply to plan years 
beginning after December 31, 1995.

         TITLE V--COMMITTEE ON GOVERNMENT REFORM AND OVERSIGHT

                         [Text to be inserted]

             TITLE VI--COMMITTEE ON INTERNATIONAL RELATIONS

SEC. 6001. RECOVERY OF COSTS OF HEALTH CARE SERVICES FOR PERSONNEL OF 
                    THE FOREIGN SERVICE OF THE UNITED STATES AND OTHER 
                    ELIGIBLE INDIVIDUALS.

    (a) Authorities.--Section 904 of the Foreign Service Act of 1980 
(22 U.S.C. 4084) is amended--
            (1) in subsection (a) by--
                    (A) striking ``and'' before ``members of the 
                families of such members and employees''; and
                    (B) by inserting immediately before the period ``, 
                and for care provided abroad) such other persons as are 
                designated by the Secretary of State, except that such 
                persons shall be considered persons other than covered 
                beneficiaries for purposes of subsections (g) and 
                (h)'';
            (2) in subsection (d) by inserting ``, subject to the 
        provisions of subsections (g) and (h)'' after ``treatment''; 
        and
            (3) by adding the following new subsections:
    ``(g)(1) In the case of a person who is a covered beneficiary, the 
Secretary of State is authorized to collect from a third-party payer 
the reasonable costs incurred by the Department of State on behalf of 
such person for health care services to the same extent that the 
covered beneficiary would be eligible to receive reimbursement or 
indemnification from the third-party payer for such costs.
    ``(2) If the insurance policy, plan, contract, or similar agreement 
of that third-party payer includes a requirement for a deductible or 
copayment by the beneficiary of the plan, then the Secretary of State 
may collect from the third-party payer only the reasonable costs of the 
care provided less the deductible or copayment amount.
    ``(3) A covered beneficiary shall not be required to pay any 
deductible or copayment for health care services under this subsection.
    ``(4) No provision of any insurance, medical service, or health 
plan contract or agreement having the effect of excluding from coverage 
or limiting payment of charges for care in the following circumstances 
shall operate to prevent collection by the Secretary of State under 
paragraph (1)--
            ``(A) care provided directly or indirectly by a 
        governmental entity;
            ``(B) care provided to an individual who has not paid a 
        required deductible or copayment; or
            ``(C) care provided by a provider with which the third-
        party payer has no participation agreement.
    ``(5) No law of any State, or of any political subdivision of a 
State, and no provision of any contract or agreement shall operate to 
prevent or hinder recovery or collection by the United States under 
this section.
    ``(6) As to the authority provided in paragraph (1) of this 
subsection--
            ``(A) the United States shall be subrogated to any right or 
        claim that the covered beneficiary may have against a third-
        party payer;
            ``(B) the United States may institute and prosecute legal 
        proceedings against a third-party payer to enforce a right of 
        the United States under this subsection; and
            ``(C) the Secretary may compromise, settle, or waive a 
        claim of the United States under this subsection.
    ``(7) The Secretary shall prescribe regulations for the 
administration of this subsection and subsection (h). Such regulations 
shall provide for computation of the reasonable cost of health care 
services.
    ``(8) Regulations prescribed under this subsection shall provide 
that medical records of a covered beneficiary receiving health care 
under this subsection shall be made available for inspection and review 
by representatives of the payer from which collection by the United 
States is sought for the sole purpose of permitting the third party to 
verify--
            ``(A) that the care or services for which recovery or 
        collection is sought were furnished to the covered beneficiary; 
        and
            ``(B) that the provisions of such care or services to the 
        covered beneficiary meets criteria generally applicable under 
        the health plan contract involved, except that this paragraph 
        shall be subject to the provisions of paragraphs (2) and (4).
    ``(9) Amounts collected under this subsection or under subsection 
(h) from a third party payer or from any other payer shall be deposited 
in the Treasury as a miscellaneous offsetting receipt.
    ``(10) For purposes of this section--
            ``(A) the term `covered beneficiary' means an individual 
        eligible to receive health care under this section whose health 
        care costs are to be paid by a third-party payer under a 
        contractual agreement with such payer;
            ``(B) the term `services', as used in `health care 
        services' includes products; and
            ``(C) the term `third-party payer' means an entity that 
        provides a fee-for-service insurance policy, contract, or 
        similar agreement through the Federal Employees Health Benefit 
        program, under which the expenses of health care services for 
        individuals are paid.
    ``(h) In the case of a person, other than a covered beneficiary, 
who receives health care services pursuant to this section, the 
Secretary of State is authorized to collect from such person the 
reasonable costs of health care services incurred by the Department of 
State on behalf of such person. The United States shall have the same 
rights against persons subject to the provisions of this subsection as 
against third-party payers covered by subsection (g).''.
    (b) Effective Date.--The authorities of this section shall be 
effective beginning on the date of the enactment of this Act.

SEC. 6002. ENACTMENT INTO LAW OF DIVISION A OF H.R. 1561.

    Division A of H.R. 1561, as passed the House of Representatives on 
June 8, 1995 (relating to consolidation of foreign affairs agencies), 
is hereby enacted into law.

                 TITLE VII--COMMITTEE ON THE JUDICIARY

SEC. 7001. PATENT AND TRADEMARK FEES.

    Section 10101 of the Omnibus Budget Reconciliation Act of 1990 (35 
U.S.C. 41 note) is amended--
            (1) in subsection (a) by striking ``1998'' and inserting 
        ``2002'';
            (2) in subsection (b)(2) by striking ``1998'' and inserting 
        ``2002''; and
            (3) in subsection (c)--
                    (A) by striking ``through 1998'' and inserting 
                ``through 2002''; and
                    (B) by adding at the end the following:
            ``(9) $119,000,000 in fiscal year 1999.
            ``(10) $119,000,000 in fiscal year 2000.
            ``(11) $119,000,000 in fiscal year 2001.
            ``(12) $119,000,000 in fiscal year 2002.''.

               TITLE VIII--COMMITTEE ON NATIONAL SECURITY

                    Subtitle A--Military Retired Pay

SEC. 8001. ELIMINATION OF DISPARITY BETWEEN EFFECTIVE DATES FOR 
                    MILITARY AND CIVILIAN RETIREE COST-OF-LIVING 
                    ADJUSTMENTS FOR FISCAL YEARS 1996, 1997, AND 1998.

    (a) Conformance With Schedule for Civil Service COLAs.--
Subparagraph (B) of section 1401a(b)(2) of title 10, United States 
Code, is amended--
            (1) by striking out ``through 1998'' the first place it 
        appears and all that follows through ``In the case of'' the 
        second place it appears and inserting in lieu thereof ``through 
        1996.--In the case of'';
            (2) by striking ``of 1994, 1995, 1996, or 1997'' and 
        inserting in lieu thereof ``of 1993, 1994, or 1995''; and
            (3) by striking out ``September'' and inserting in lieu 
        thereof ``March''.
    (b) Repeal of Prior Conditional Enactment.--Section 8114A(b) of 
Public Law 103-335 (108 Stat. 2648) is repealed.

                  Subtitle B--Naval Petroleum Reserves

SEC. 8011. SALE OF NAVAL PETROLEUM RESERVES.

    (a) Sale of Reserves Required.--Chapter 641 of title 10, United 
States Code, is amended by inserting after section 7421 the following 
new section:

``Sec. 7421a. Sale of naval petroleum reserves

    ``(a) Sale Required.--(1) Notwithstanding any other provision of 
this chapter, the Secretary shall sell all right, title, and interest 
of the United States in and to the lands owned or controlled by the 
United States inside the naval petroleum and oil shale reserves 
established by this chapter. In the case of Naval Petroleum Reserve 
Numbered 1, the lands to be sold shall include sections 16 and 36 of 
township 30 south, range 23 east, Mount Diablo Principal Meridian, 
California.
    ``(2) Not later than September 30, 1996, the Secretary shall enter 
into one or more contracts for the sale of all of the interest of the 
United States in the naval petroleum reserves.
    ``(b) Timing and Administration of Sale.--(1) Not later than 
January 1, 1996, the Secretary shall retain the services of five 
independent experts in the valuation of oil and gas fields to conduct 
separate assessments, in a manner consistent with commercial practices, 
of the fair market value of the interest of the United States in each 
naval petroleum reserve. In making their assessments for each naval 
petroleum reserve, the independent experts shall consider (among other 
factors) all equipment and facilities to be included in the sale, the 
net present value of the reserve, and the net present value of the 
anticipated revenue stream that the Secretary determines the Treasury 
would receive from the reserve if it were not sold, adjusted for any 
anticipated increases in tax revenues that would result if it were 
sold. The independent experts shall complete their assessments not 
later than June 1, 1996. In setting the minimum acceptable price for 
each naval petroleum reserve, the Secretary shall consider the average 
of the five assessments regarding the reserve or, if more advantageous 
to the Government, the average of three assessments after excluding the 
high and low assessments.
    ``(2) Not later than March 1, 1996, the Secretary shall retain the 
services of an investment banker to independently administer, in a 
manner consistent with commercial practices and in a manner that 
maximizes sale proceeds to the Government, the sale of the naval 
petroleum reserves under this section. The Secretary may enter into the 
contracts required under this paragraph and paragraph (1) on a 
noncompetitive basis.
    ``(3) Not later than June 1, 1996, the sales administrator selected 
under paragraph (2) shall complete a draft contract for the sale of 
each naval petroleum reserve, which shall accompany the invitation for 
bids and describe the terms and provisions of the sale of the interest 
of the United States in the reserve. Each draft contract shall identify 
all equipment and facilities to be included in the sales. Each draft 
contract, including the terms and provisions of the sale of the 
interest of the United States in the naval petroleum reserves, shall be 
subject to review and approval by the Secretary, the Secretary of the 
Treasury, and the Director of the Office of Management and Budget.
    ``(4) Not later than July 1, 1996, the Secretary shall publish an 
invitation for bids for the purchase of the naval petroleum reserves.
    ``(5) Not later than September 1, 1996, the Secretary shall accept 
the highest responsible offer for purchase of the interest of the 
United States in the naval petroleum reserves, or a particular reserve, 
that meets or exceeds the minimum acceptable price determined under 
paragraph (1). The Secretary may accept an offer for only a portion of 
a reserve so long as the entire reserve is still sold under this 
section at a price that meets or exceeds the minimum acceptable price.
    ``(c) Future Liabilities.--To effectuate the sale of the interest 
of the United States in a naval petroleum reserve, the Secretary may 
extend such indemnities and warranties as the Secretary considers 
reasonable and necessary to protect the purchaser from claims arising 
from the ownership in the reserve by the United States.
    ``(d) Special Rules Preparatory to Sale of Naval Petroleum Reserve 
Numbered 1.--(1) Not later than June 1, 1996, the Secretary shall 
finalize equity interests of the known oil and gas zones in Naval 
Petroleum Reserve Numbered 1 in the manner provided by this subsection.
    ``(2) The Secretary shall retain the services of an independent 
petroleum engineer, mutually acceptable to the equity owners, who shall 
prepare a recommendation on final equity figures. The Secretary may 
accept the recommendation of the independent petroleum engineer for 
final equity in each known oil and gas zone and establish final equity 
interest in the Naval Petroleum Reserve Numbered 1 in accordance with 
such recommendation, or the Secretary may use such other method to 
establish final equity interest in that reserve as the Secretary 
considers appropriate. The Secretary may enter into the contract 
required under this paragraph on a noncompetitive basis.
    ``(3) If, on the effective date of this section, there is an 
ongoing equity redetermination dispute between the equity owners under 
section 9(b) of the unit plan contract, such dispute shall be resolved 
in the manner provided in the unit plan contract not later than June 1, 
1996. Such resolution shall be considered final for all purposes under 
this section.
    ``(4) In this section, the term `unit plan contract' means the unit 
plan contract between equity owners of the lands within the boundaries 
of Naval Petroleum Reserve Numbered 1 (Elk Hills) entered into on June 
19, 1944.
    ``(e) Production Allocation Regarding Naval Petroleum Reserve 
Numbered 1.--(1) As part of the contract for purchase of Naval 
Petroleum Reserve Numbered 1, the purchaser of the interest of the 
United States in that reserve shall agree to make up to 25 percent of 
the purchaser's share of annual petroleum production from the purchased 
lands available for sale to small refiners, which do not have their own 
adequate sources of supply of petroleum, for processing or use only in 
their own refineries. None of the reserved production sold to small 
refiners may be resold in kind. The purchaser of that reserve may 
reduce the quantity of petroleum reserved under this subsection in the 
event of an insufficient number of qualified bids. The seller of this 
petroleum production has the right to refuse bids that are less than 
the prevailing market price of comparable oil.
    ``(2) The purchaser of Naval Petroleum Reserve Numbered 1 shall 
also agree to ensure that the terms of every sale of the purchaser's 
share of annual petroleum production from the purchased lands shall be 
so structured as to give full and equal opportunity for the acquisition 
of petroleum by all interested persons, including major and independent 
oil producers and refiners alike.
    ``(f) Maintaining Production Pending Sale of Naval Petroleum 
Reserve Numbered 1.--Until the sale of Naval Petroleum Reserve Numbered 
1 is completed under this section, the Secretary shall continue to 
produce that reserve at the maximum daily oil or gas rate from a 
reservoir, which will permit maximum economic development of the 
reservoir consistent with sound oil field engineering practices in 
accordance with section 3 of the unit plan contract. The definition of 
maximum efficient rate in section 7420(6) of this title shall not apply 
to Naval Petroleum Reserve Numbered 1.
    ``(g) Effect on Existing Contracts.--(1) In the case of any 
contract, in effect on the effective date of this section, for the 
purchase of production from any part of the United States' share of the 
naval petroleum reserves, the sale of the interest of the United States 
in the reserves shall be subject to the contract for a period of three 
months after the closing date of the sale or until termination of the 
contract, whichever occurs first. The term of any contract entered into 
after the effective date of this section for the purchase of such 
production shall not exceed the anticipated closing date for the sale 
of the reserve.
    ``(2) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in the 
contract between the United States and Bechtel Petroleum Operation, 
Inc., Contract Number DE-ACO1-85FE60520 so that the contract terminates 
not later than the date of closing of the sale of that reserve.
    ``(3) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in the 
unit plan contract so that the unit plan contract terminates not later 
than the date of closing of the sale of that reserve.
    ``(h) Offer of Settlement of State of California Claims Regarding 
Naval Petroleum Reserve Numbered 1.--(1) In connection with the sale of 
Naval Petroleum Reserve Numbered 1, the Secretary shall offer to settle 
all claims against the United States by the State of California and the 
Teachers' Retirement Fund of the State of California with respect to 
lands within that reserve, including sections 16 and 36 of township 30 
south, range 23 east, Mount Diablo Principal Meridian, California, or 
production or proceeds of sale from that reserve. Subject to paragraph 
(2), the Secretary shall offer in settlement of such claims--
            ``(A) a payment from funds provided for this purpose in 
        advance in appropriation Acts;
            ``(B) a grant of land pursuant to sections 2275 and 2276 of 
        the Revised Statutes of the United States (43 U.S.C. 851 and 
        852) so long as such land is not generating revenue for the 
        United States;
            ``(C) any other option that would not be inconsistent with 
        the Congressional Budget Act of 1974 (2 U.S.C. 621 et seq.); or
            ``(D) any combination of subparagraphs (A), (B), and (C).
    ``(2) The value of any payment, grant, or option (or combination 
thereof) offered as settlement under paragraph (1) may not exceed an 
amount equal to seven percent of the proceeds from the sale of Naval 
Petroleum Reserve Numbered 1, after deducting the costs incurred to 
conduct the sale of that reserve.
    ``(3) Acceptance of the settlement offered under paragraph (1) 
shall be subject to the condition that all claims against the United 
States by the State of California or the Teachers' Retirement Fund of 
the State of California are released with respect to lands within the 
Naval Petroleum Reserve Numbered 1, including sections 16 and 36 of 
township 30 south, range 23 east, Mount Diablo Principal Meridian, 
California, or production or proceeds of sale from that reserve. The 
Secretary may specify the manner in which the release of such claims 
shall be evidenced.
    ``(i) Effect on Antitrust Laws.--Nothing in this section shall be 
construed to alter the application of the antitrust laws of the United 
States to the purchaser of a naval petroleum reserve or to the lands in 
the naval petroleum reserves subject to sale under this section upon 
the completion of the sale.
    ``(j) Preservation of Private Right, Title, and Interest.--Nothing 
in this section shall be construed to adversely affect the ownership 
interest of any other entity having any right, title, and interest in 
and to lands within the boundaries of the naval petroleum reserves.
    ``(k) Congressional Notification.--Section 7431 of this title shall 
not apply to the sale of the naval petroleum reserves under this 
section. However, the Secretary may not enter into a contract for the 
sale of a naval petroleum reserve until the end of the 15-day period 
beginning on the date on which the Secretary notifies the Committee on 
Armed Services of the Senate and the Committee on National Security and 
the Committee on Commerce of the House of Representatives that the 
Secretary has accepted an offer under subsection (b)(5) for the sale of 
that reserve.''.
    (b) Clerical Amendment.--The table of sections at the beginning of 
such chapter is amended by inserting after the item relating to section 
7421 the following new item:

``7421a. Sale of naval petroleum reserves.''.

                 Subtitle C--National Defense Stockpile

SEC. 8021. DISPOSAL OF CERTAIN MATERIALS IN NATIONAL DEFENSE STOCKPILE 
                    FOR DEFICIT REDUCTION.

    (a) Disposals Required.--(1) During fiscal year 1996, the President 
shall dispose of all cobalt contained in the National Defense Stockpile 
that, as the date of the enactment of this Act, is authorized for 
disposal under any law (other than this Act).
    (2) In addition to the disposal of cobalt under paragraph (1), the 
President shall dispose of additional quantities of cobalt and 
quantities of aluminum, ferro columbium, germanium, palladium, 
platinum, and rubber contained in the National Defense Stockpile so as 
to result in receipts to the United States in amounts equal to--
            (A) $21,000,000 during the fiscal year ending September 30, 
        1996;
            (B) $338,000,000 during the five-fiscal year period ending 
        on September 30, 2000; and
            (C) $649,000,000 during the seven-fiscal year period ending 
        on September 30, 2002.
    (3) The President is not required to include the disposal of the 
materials identified in paragraph (2) in an annual materials plan for 
the National Defense Stockpile. Disposals made under this section may 
be made without consideration of the requirements of an annual 
materials plan.
    (b) Limitation on Disposal Quantity.--The total quantities of 
materials authorized for disposal by the President under subsection 
(a)(2) may not exceed the amounts set forth in the following table:


                     Authorized Stockpile Disposals                     
------------------------------------------------------------------------
   Material for disposal                              Quantity          
------------------------------------------------------------------------
Aluminum..................................  62,881 short tons           
Cobalt....................................  42,482,323 pounds contained 
Ferro Columbium...........................  930,911 pounds contained    
Germanium.................................  68,207 kilograms            
Palladium.................................  1,264,601 troy ounces       
Platinum..................................  452,641 troy ounces         
Rubber....................................  125,138 long tons           
------------------------------------------------------------------------

    (c) Deposit of Receipts.--Notwithstanding section 9 of the 
Strategic and Critical Materials Stock Piling Act (50 U.S.C. 98h), 
funds received as a result of the disposal of materials under 
subsection (a)(2) shall be deposited into the general fund of the 
Treasury for the purpose of deficit reduction.
    (d) Relationship to Other Disposal Authority.--The disposal 
authority provided in subsection (a)(2) is new disposal authority and 
is in addition to, and shall not affect, any other disposal authority 
provided by law regarding the materials specified in such subsection.
    (e) Termination of Disposal Authority.--The President may not use 
the disposal authority provided in subsection (a)(2) after the date on 
which the total amount of receipts specified in subparagraph (C) of 
such subsection is achieved.
    (f) Definition.--The term ``National Defense Stockpile'' means the 
National Defense Stockpile provided for in section 4 of the Strategic 
and Critical Materials Stock Piling Act (50 U.S.C. 98c).

                    TITLE IX--COMMITTEE ON RESOURCES

SEC. 9000. TABLE OF CONTENTS.

    The table of contents for this title is as follows:

                    TITLE IX--COMMITTEE ON RESOURCES

Sec. 9000. Table of contents.

              Subtitle A--Alaska and Helium Privatization

                             Part 1--Alaska

Sec. 9001. Exports of Alaskan North Slope oil.
Sec. 9002. Arctic Coastal Plain leasing and revenue.
Sec. 9003. Alaska Power Administration sale.

                      Part 2--Helium Privatization

Sec. 9011. Short title.
Sec. 9012. Amendment of Helium Act.
Sec. 9013. Authority of Secretary.
Sec. 9014. Sale of crude helium.
Sec. 9015. Elimination of stockpile.
Sec. 9016. Repeal of authority to borrow.
Sec. 9017. Reports.
Sec. 9018. Land conveyance in Potter County, Texas.

                      Subtitle B--Water and Power

                Part 1--Power Marketing Administrations

Sec. 9201. Short title.
Sec. 9202. Sale of the Southeastern Power Administration.
Sec. 9203. Federal Energy Regulatory Commission jurisdiction.
Sec. 9204. Evaluation of sales of Southwestern Power Administration and 
Western Area Power Administration facilities.
Sec. 9205. Bonneville Power Administration appropriations refinancing.

                          Part 2--Reclamation

Sec. 9211. Prepayment of certain repayment contracts between the United 
States and the Central Utah Water Conservancy District.
Sec. 9212. Treatment of city of Folsom as a Central Valley Project 
contractor.
Sec. 9213. Sly Park.
Sec. 9214. Hetch Hetchy Dam.

         Subtitle C--National Parks, Forests, and Public Lands

                       Part 1--Concession Reform

Sec. 9301. Short title.
Sec. 9302. Purpose.
Sec. 9303. Definitions.
Sec. 9304. Nature and types of concession authorizations.
Sec. 9305. Competitive selection process for concession service 
agreements.
Sec. 9306. Concessioner evaluations.
Sec. 9307. Capital improvements.
Sec. 9308. Duration of concession authorization.
Sec. 9309. Rates and charges to the public.
Sec. 9310. Transferability of concession authorizations.
Sec. 9311. Fees charged by the United States for concession 
authorizations.
Sec. 9312. Disposition of fees.
Sec. 9313. Dispute resolution.
Sec. 9314. Recordkeeping.
Sec. 9315. Application of general governmental acquisition 
requirements.
Sec. 9316. Rules of construction.
Sec. 9317. Regulations.
Sec. 9318. Relationship to other existing laws.

                   Part 2--National Forest Ski Areas

Sec. 9321. Privatization of Forest Service ski areas.
Sec. 9322. Ski area permit fees and withdrawal of ski areas from 
operation of mining laws.

                   Part 3--Domestic Livestock Grazing

Sec. 9331. Applicable regulations.
Sec. 9332. Fees and charges.
Sec. 9333. Animal unit month.
Sec. 9334. Term of grazing permits or grazing leases.
Sec. 9335. Conformance with land use plan.
Sec. 9336. Effective date.

     Part 4--Regional Disposal Facility of Southwestern Low Level 
                   Radioactive Waste Disposal Compact

Sec. 9341. Conveyance of property.
Sec. 9342. Conveyance of easements.

                        Subtitle D--Territories

          Part 1--Commonwealth of the Northern Mariana Islands

Sec. 9401. Termination of annual direct grant assistance.

            Part 2--Territorial Administrative Cessation Act

Sec. 9421. Short title.
Sec. 9422. Congressional findings.
Sec. 9423. Elimination of Office of Territorial and International 
Affairs.
Sec. 9424. Certain activities not funded.

                          Subtitle E--Minerals

                        Part 1--Hardrock Mining

Sec. 9501. Findings and purpose.
Sec. 9502. Patents under the general mining law.
Sec. 9503. Royalty under the general mining law.
Sec. 9504. Mineral materials.
Sec. 9505. Claim maintenance requirements.

                 Part 2--Federal Oil and Gas Royalties

Sec. 9511. Short title.
Sec. 9512. Definitions.
Sec. 9513. Limitation periods.
Sec. 9514. Adjustment and refunds.
Sec. 9515. Required recordkeeping.
Sec. 9516. Royalty interest, penalties, and payments.
Sec. 9517. Limitation on assessments.
Sec. 9518. Alternatives for marginal properties.
Sec. 9519. Royalty in kind.
Sec. 9520. Royalty simplification and cost-effective audit and 
collection requirements.
Sec. 9521. Repeals.
Sec. 9522. Delegation to States.
Sec. 9523. Performance standard.
Sec. 9524. Indian lands.
Sec. 9525. Private lands.
Sec. 9526. Effective date.

                  Subtitle F--Indian Gaming and Health

                         Part 1--Indian Gaming

Sec. 9601. Indian gaming.

                    Part 2--Indian Health: Medicaid

Sec. 9611. Health care facilities.
Sec. 9612. Provider reimbursement.
Sec. 9613. Study.

                    Part 3--Indian Health: Medicare

Sec. 9621. Health care facilities.
Sec. 9622. Provider reimbursement.

                        Subtitle G--Consultation

Sec. 9701. Consultation.

                          Subtitle H--Mapping

Sec. 9801. Short title.
Sec. 9802. Surveying and mapping contracting program.
Sec. 9803. Inventory of activities.
Sec. 9804. Plan to increase use of contracts.
Sec. 9805. Reports.
Sec. 9806. Definitions.

                Subtitle I--National Park System Reform

Sec. 9901. Short title.
Sec. 9902. Definitions.

                   Part 1--National Park System Plan

Sec. 9911. Preparation of National Park System plan.
Sec. 9912. Management review of National Park System.
Sec. 9913. National Park System Review Commission.
Sec. 9914. Subsequent Act of Congress required to modify or terminate a 
park.
Sec. 9915. Authorization of appropriations.
Sec. 9916. Commendation and protection of National Park rangers.

                     Part 2--New Area Establishment

Sec. 9921. Study of new Park System areas.

              Subtitle A--Alaska and Helium Privatization

                             PART 1--ALASKA

SEC. 9001. EXPORTS OF ALASKAN NORTH SLOPE OIL.

    (a) Amendment of Mineral Leasing Act.--Section 28(s) of the Mineral 
Leasing Act (30 U.S.C. 185(s)) is amended to read as follows:
                  ``exports of alaskan north slope oil
    ``(s)(1) Subject to paragraphs (2) through (6) of this subsection 
and notwithstanding any other provision of this Act or any other 
provision of law (including any regulation) applicable to the export of 
oil transported by pipeline over right-of-way granted pursuant to 
section 203 of the Trans-Alaska Pipeline Authorization Act (43 U.S.C. 
1652), such oil may be exported unless the President finds that 
exportation of this oil is not in the national interest. The President 
shall make his national interest determination within 5 months after 
the date of enactment of this subsection. In evaluating whether exports 
of this oil are in the national interest, the President shall at a 
minimum consider--
            ``(A) whether exports of this oil would diminish the total 
        quantity or quality of petroleum available to the United 
        States;
            ``(B) the results of an appropriate environmental review, 
        including consideration of appropriate measures to mitigate any 
        potential adverse effects of exports of this oil on the 
        environment, which shall be completed within four months of the 
        date of the enactment of this subsection; and
            ``(C) whether exports of this oil are likely to cause 
        sustained material oil supply shortages or sustained oil prices 
        significantly above world market levels that would cause 
        sustained material adverse employment effects in the United 
        States or that would cause substantial harm to consumers, 
        including in noncontiguous States and Pacific territories.
If the President determines that exports of this oil are in the 
national interest, he may impose such terms and conditions (other than 
a volume limitation) as are necessary or appropriate to ensure that 
such exports are consistent with the national interest.
    ``(2) Except in the case of oil exported to a country with which 
the United States entered into a bilateral international oil supply 
agreement before November 26, 1979, or to a country pursuant to the 
International Emergency Oil Sharing Plan of the International Energy 
Agency, any oil transported by pipeline over right-of-way granted 
pursuant to section 203 of the Trans-Alaska Pipeline Authorization Act 
(43 U.S.C. 1652) shall, when exported, be transported by a vessel 
documented under the laws of the United States and owned by a citizen 
of the United States (as determined in accordance with section 2 of the 
Shipping Act, 1916 (46 U.S.C. App. 802)).
    ``(3) Nothing in this subsection shall restrict the authority of 
the President under the Constitution, the International Emergency 
Economic Powers Act (50 U.S.C. 1701 et seq.), or the National 
Emergencies Act (50 U.S.C. 1601 et seq.) to prohibit exports of this 
oil or under Part B of title II of the Energy Policy and Conservation 
Act (42 U.S.C. 6271-76).
    ``(4) The Secretary of Commerce shall issue any rules necessary for 
implementation of the President's national interest determination, 
including any licensing requirements and conditions, within 30 days of 
the date of such determination by the President. The Secretary of 
Commerce shall consult with the Secretary of Energy in administering 
the provisions of this subsection.
    ``(5) If the Secretary of Commerce finds that exporting oil under 
authority of this subsection has caused sustained material oil supply 
shortages or sustained oil prices significantly above world market 
levels and further finds that these supply shortages or price increases 
have caused or are likely to cause sustained material adverse 
employment effects in the United States, the Secretary of Commerce, in 
consultation with the Secretary of Energy, shall recommend, and the 
President may take, appropriate action concerning exports of this oil, 
which may include modifying or revoking authority to export such oil.
    ``(6) Administrative action under this subsection is not subject to 
sections 551 and 553 through 559 of title 5, United States Code.''.
    (b) GAO Report.--
            (1) Review.--The Comptroller General of the United States 
        shall conduct a review of energy production in California and 
        Alaska and the effects of Alaskan North Slope oil exports, if 
        any, on consumers, independent refiners, and shipbuilding and 
        ship repair yards on the West Coast and in Hawaii. The 
        Comptroller General shall commence this review 2 years after 
        the date of enactment of this Act and, within 6 months after 
        commencing the review, shall provide a report to the Committee 
        on Resources and the Committee on Commerce of the House of 
        Representatives and the Committee on Energy and Natural 
        Resources of the Senate.
            (2) Contents of Report.--The report shall contain a 
        statement of the principal findings of the review and 
        recommendations for Congress and the President to address job 
        loss in the shipbuilding and ship repair industry on the West 
        Coast, as well as adverse impacts on consumers and refiners on 
        the West Coast and in Hawaii, that the Comptroller General 
        attributes to Alaska North Slope oil exports.

SEC. 9002. ARCTIC COASTAL PLAIN LEASING AND REVENUE.

    (a) Purpose.--It is the purpose of this section to reduce the 
Federal deficit by an estimated $1,300,000,000 over the next 5 years. 
This revenue will be derived from competitive bonus bids for oil and 
gas leases in the Coastal Plain area of Alaska's North Slope.
    (b) Definitions.--For the purposes of this section:
            (1) The term ``Secretary'' means the Secretary of the 
        Interior.
            (2) The term ``Coastal Plain'' means that portion of the 
        Arctic National Wildlife Refuge identified in section 
        1002(b)(1) of the Alaska National Interest Lands Conservation 
        Act of 1980 (Public Law 96-487; 16 U.S.C. 3142(b)(1)) 
        consisting of approximately 1,549,000 acres.
    (c) Compatibility.--Congress hereby determines that the oil and gas 
leasing program and activities authorized by this section in the 
Coastal Plain are compatible with the purposes for which the Arctic 
National Wildlife Refuge was established, and that no further findings 
or decisions are required to implement this determination.
    (d) Authorization.--(1) Congress hereby authorizes and directs the 
Secretary to establish and promptly implement a program to assure the 
expeditious competitive leasing exploration, development, production, 
and transportation of the oil and gas resources of the Coastal Plain. 
Regulations to implement this program and to govern oil and gas 
leasing, exploration, development and production shall be promulgated 
by the Secretary within 6 months of the date of enactment of this 
section.
    (2) The Coastal Plain leasing program required by paragraph (1) 
shall include the following:
            (A) The first lease sale of not less than 200,000 acres 
        shall be conducted within 12 months of the date of enactment of 
        this section.
            (B) The lease sales shall be based upon an industry 
        nomination process.
            (C) The Secretary is directed to grant to the highest 
        responsible qualified bidder or bidders by competitive bidding, 
        under regulations promulgated in advance, any oil and gas lease 
        on unleased Federal lands within the Coastal Plain. These 
        regulations may provide for the deposit of cash bids in an 
        interest-bearing account until the Secretary accepts the bids, 
        with interest earned paid to the General Treasury for bids that 
        are accepted, and to the unsuccessful bidders for bids that are 
        rejected.
            (D) Royalty payments shall not be less than 12\1/2\ 
        percent, and rental payments shall be prescribed by the 
        Secretary.
            (E) The Attorney General of the United States and the 
        Federal Trade Commission may conduct such review of lease terms 
        and lease sale activities as are necessary to ensure compliance 
        with the antitrust laws.
            (F) The size of lease tracts may be up to 11,520 acres but 
        not less than 2,560 acres, as determined by the Secretary, 
        except that the Secretary may lease smaller tracts if he 
        determines smaller tracts are necessary to promote a more 
        competitive leasing program or are necessary in certain 
        locations to mitigate reasonably foreseeable impacts on the 
        environment.
            (G) Each lease shall be issued for an initial period of up 
        to 10 years and shall be extended as long as oil or gas is 
        produced in paying quantities from the lease or unit area to 
        which the lease is committed or as drilling or reworking 
        operations as approved by the Secretary are conducted thereon.
            (H) The Secretary is authorized and directed to promulgate 
        regulations and to include terms in leases to ensure that--
                    (i) activities are conducted pursuant to an 
                approved exploration or development plan;
                    (ii) lessees secure an appropriate performance bond 
                to cover activities;
                    (iii) provision is made for the suspension, 
                cancellation, assignment, relinquishment and 
                unitization of leases; and
                    (iv) the Secretary has access to lease information 
                and that confidential, privileged or proprietary 
                information furnished by lessees is adequately 
                protected.
    (e) Judicial Review.--Any complaint filed seeking judicial review 
of an action of the Secretary in promulgating any regulation under this 
section may be filed only in the United States Court of Appeals for the 
District of Columbia, and such complaint shall be filed within 90 days 
from the date of such promulgation, or after such date if such 
complaint is based solely on grounds arising after such 90th day, in 
which case the complaint must be filed within 90 days after the 
complainant knew or reasonably should have known of the grounds for the 
complaint. Any complaint seeking judicial review of any other actions 
of the Secretary under this section may be filed in any appropriate 
district court of the United States, and such complaint must be filed 
within 90 days from the date of the action being challenged, or after 
such date if such complaint is based solely on grounds arising after 
such 90th day, in which case the complaint must be filed within 90 days 
after the complainant knew or reasonably should have known of the 
grounds for the complaint.
    (f) Administration.--(1) Section 1003 of the Alaska National 
Interest Lands Conservation Act of 1980 (94 Stat. 2452; 16 U.S.C. 3143) 
is repealed.
    (2) This section shall be considered the primary land management 
authorization for all activities associated with exploration, 
development, and production from the Coastal Plain. No land management 
review, determination, or other action shall be required except as 
specifically authorized by this section.
    (g) Protection of Fish and Wildlife Resources and Other 
Environmental Values.--(1) Before conducting a competitive oil and gas 
lease sale under this section, the Secretary shall promulgate, within 6 
months, as provided in subsection (d)(1), such rules and regulations as 
are necessary to ensure that oil and gas exploration, development, 
production, and transportation activities undertaken in the Coastal 
Plain achieve the reasonable protection of the fish and wildlife 
resources, environment and subsistence uses of the Coastal Plain.
    (2) The Secretary shall administer the provisions of this section 
through regulations and lease terms that the Secretary determines to be 
necessary to mitigate reasonably foreseeable and significantly adverse 
effects on the fish and wildlife, surface resources and subsistence 
resources of the Coastal Plain.
    (3)(A) The Secretary, after consultation with the State of Alaska, 
the city of Kaktovik, Alaska, and the North Slope Borough, is 
authorized to close to leasing and designate up to 30,000 acres of the 
Coastal Plain as Special Areas if the Secretary determines that these 
lands are of such unique character and interest so as to require 
special management and regulatory protection. The Secretary shall 
notify the Committee on Energy and Natural Resources of the Senate and 
the Committee on Resources of the House of Representatives 90 days in 
advance of making such designations. The Secretary may permit leasing 
of all or portions of any lands within the Coastal Plain designated as 
Special Areas by setting lease terms that limit or condition surface 
use and occupancy by lessees of such lands but permit the use of 
horizontal drilling technology from sites on leases located outside the 
designated Special Areas.
    (B) Notwithstanding any other provision of law or any international 
agreement to which the United States is a party, the Secretary's sole 
authority to close lands within the Coastal Plain to oil and gas 
leasing and to exploration, development, and production as provided for 
in this part is set forth in subparagraph (A).
    (4) The Secretary shall, in consultation with the State of Alaska, 
the city of Kaktovik, Alaska, and the North Slope Borough, develop 
guidelines to encourage the siting of facilities having common use 
characteristics (service bases, ports and docks, airports, major 
pipelines and roads) in a manner which leads to facility consolidation, 
avoids unnecessary duplication, utilizes existing facilities, minimizes 
impacts on fish, wildlife, habitat and the subsistence activities of 
residents of Native communities, and avoids disruption of the lives of 
the residents of the Village of Kaktovik and other communities.
    (5) Notwithstanding title XI of the Alaska National Interest Lands 
Conservation Act of 1980 (94 Stat. 2457; 16 U.S.C. 3161 et seq.), the 
Secretary is authorized and directed to grant, under sections 28(a) 
through (t) and (v) through (y) of the Mineral Leasing Act (30 U.S.C. 
185), rights-of-way and easements across the Coastal Plain for the 
purposes of this section, for pipeline construction, and the 
transportation of oil and gas and related purposes.
    (6) The Secretary is authorized to close, on a seasonal basis, 
portions of the Coastal Plain to exploratory drilling activities as 
necessary to protect caribou calving areas and other species of fish 
and wildlife.
    (h) Application of Environmental Laws.--The ``Final Legislative 
Environmental Impact Statement'' (April 1987) prepared pursuant to 
section 1002 of the Alaska National Interest Lands Conservation Act of 
1980 (94 Stat. 2449; 16 U.S.C. 3142) and section 102(2)(C) of the 
National Environmental Policy Act of 1969 (89 Stat. 424; 42 U.S.C. 
4332(2)(C)) is hereby determined to be adequate and legally sufficient 
for all actions authorized pursuant to this section, including all 
phases of oil and gas leasing, exploration, development, production, 
transportation and related activities, including the granting of 
rights-of-way, use permits and other authorizations.
    (i) New Revenues.--(1) Notwithstanding any other provision of law, 
all revenues received from competitive bids, sales, bonuses, royalties, 
rents, fees, interest or other income derived from the leasing of oil 
and gas resources within the Coastal Plain shall be deposited into the 
Treasury of the United States: Provided, That 50 percent of all such 
Coastal Plain revenues shall be paid by the Secretary of the Treasury 
semiannually, on March 30th and on September 30th of each year, to the 
State of Alaska.
    (2) On March 1st of each year following the date of enactment of 
this section, the Secretary shall prepare and submit to the Congress an 
annual report on the revenues derived and on the leasing program 
authorized by this section.
    (j) Conveyance.--Notwithstanding the provisions of section 
1302(h)(2) of the Alaska National Interest Lands Conservation Act (16 
U.S.C. 3192(h)(2)), the Secretary is authorized and directed to convey 
(1) to the Kaktovik Inupiat Corporation the surface estate of the lands 
described in paragraph 2 of Public Land Order 6959, to the extent 
necessary to fulfill the corporation's entitlement under section 12 of 
the Alaska Native Claims Settlement Act (43 U.S.C. 1611), and (2) to 
the Arctic Slope Regional Corporation the subsurface estate beneath 
such surface estate pursuant to the August 9, 1983, agreement between 
the Arctic Slope Regional Corporation and the United States of America.
    (k) Penalty.--Any person, including any Federal official, who fails 
to comply with any provision or mandate of this section, a lease term, 
or a regulation promulgated under this section, after notice of such 
failure and expiration of a reasonable period for corrective action, 
shall be liable, after hearing, for a civil penalty of not more than 
$10,000 for each day of the continuance of such failure.
    (l) Community Assistance.--There is hereby established a Community 
Assistance Fund in the Treasury which shall be maintained at a level of 
$5,000,000 annually from the Federal share of Coastal Plain revenues 
and shall be available to the Secretary for the purposes of this 
section. Organized boroughs, other municipal subdivisions of the State 
of Alaska, and recognized Indian Reorganization Act entities which are 
impacted by activities authorized under this section shall be eligible, 
on application to the Secretary, for local assistance from the 
Community Assistance Fund for needed social services and to provide 
public services and facilities required in connection with supporting 
exploration and development of the Coastal Plain.
    (m) Employment and Contracting.--As a condition of any leases, 
permits, or other Federal authorizations granted or issued pursuant to 
this section, a recipient of those leases, permits, or authorizations 
shall be required to use its best efforts to assure that the lessee and 
its agents and contractors provide a fair share of employment and 
contracting for Alaska Natives and Alaska Native Corporations from 
throughout the State.
    (n) Use of ANWR Revenues.--
            (1) Establishment of endowment.--There is hereby 
        established in the general fund of the Treasury a separate 
        account which shall be known as the National Endowment for Fish 
        and Wildlife.
            (2) Contents.--(A) Except as provided in subparagraph (B), 
        the Endowment shall consist of revenues received from the 
        following sources:
                    (i) Gifts, devises, and bequests to the Endowment.
                    (ii) Amounts appropriated by the Congress to the 
                Endowment.
                    (iii) Any revenues deposited into the Treasury of 
                the United States under subsection (i), from the 
                Federal share of revenues derived from oil and gas 
                leasing within the Coastal Plain, that exceed 
                $1,300,000,000.
            (B) After the Endowment has reached a level of $250,000,000 
        in principal, further payments to the Endowment shall consist 
        only of the following:
                    (i) Gifts, devises, and bequests to the Endowment.
                    (ii) Amounts appropriated by the Congress to the 
                Endowment.
                    (iii) 5 percent of the Federal royalties derived 
                from commercial production of oil and gas on Federal 
                leases on the Coastal Plain.
            (3) Establishment of fish and wildlife conservation 
        commission.--(A) To carry out the purposes of this subsection, 
        there is hereby established a commission to be known as the 
        Fish and Wildlife Conservation Commission.
            (B) The Commission shall consist of--
                    (i) the Secretary of the Interior, who shall be the 
                chairman,
                    (ii) 3 Members of the Senate selected by the 
                President of the Senate, and
                    (iii) 3 Members of the House of Representatives 
                selected by the Speaker.
            (C) At least 1 member of the Commission selected from each 
        House of Congress shall be a member of the minority party in 
        that House.
            (D) Any Member of the House of Representatives who is a 
        member of the Commission, if reelected to the succeeding 
        Congress, may serve on the Commission notwithstanding the 
        expiration of a Congress.
            (E) Any vacancy on the Commission shall be filled in the 
        same manner as the original appointment.
            (4) Expenditures by commission.--(A) The Fish and Wildlife 
        Commission may make expenditures from the Endowment for the 
        following fish and wildlife conservation purposes:
                    (i) Acquisition of important habitat lands for 
                endangered species or threatened species from owners of 
                private property. Such lands may be acquired solely on 
                a willing seller basis and shall be managed by the 
                Secretary of the Interior for the conservation of such 
                species pursuant to the terms of section 5 of the 
                Endangered Species Act of 1973 (16 U.S.C. 1534).
                    (ii) Provision of funding for purposes authorized 
                under the Endangered Species Act of 1973.
                    (iii) Provision of funds to the North American 
                Wetlands Conservation Fund pursuant to the North 
                American Wetlands Conservation Act (16 U.S.C. 4401 et 
                seq.).
            (B) The amount expended under subparagraph (A)(iii) each 
        fiscal year shall equal or exceed 25 percent of the total 
        expenditures from the Endowment in that fiscal year.
            (C) The Secretary of the Interior may not recommend any 
        lands or interest in lands for purchase or other forms of 
        acquisition using funds made available under the terms of this 
        section unless the Secretary of the Interior--
                    (i) has determined that such lands are necessary 
                for the conservation of endangered species or other 
                fish and wildlife; and
                    (ii) has consulted with the county or other unit of 
                local government in which such lands are located and 
                with the Governor of the State concerned.
            (D) Land or an interest in land may not be acquired with 
        moneys from the Endowment unless--
                    (i) the acquisition thereof has been approved by 
                the Governor of the State in which the land is located; 
                and
                    (ii) the owner of the land or interest has offered 
                the land or interest for acquisition under this 
                subsection and consented to the acquisition.
            (5) Annual report.--The Commission shall, through its 
        chairman, annually report in detail to the Congress, by not 
        later than the first Monday in December, regarding the 
        operations of the Commission during the preceding fiscal year.
            (6) State law.--The jurisdiction of any State, both civil 
        and criminal, over persons upon areas acquired under this 
        subsection shall not be changed or otherwise affected by reason 
        of the acquisition and administration of the areas by the 
        United States as endangered species habitat. Nothing in this 
        subsection is intended to interfere with the operation of the 
        game laws of the States.
            (7) Administration of areas acquired.--Areas of lands, 
        waters, or interest therein acquired or reserved pursuant to 
        this subsection shall, unless otherwise provided by law, be 
        administered by the Secretary of the Interior under rules and 
        regulations prescribed by the Secretary to conserve and protect 
        endangered species in accordance with the Endangered Species 
        Act of 1973, or to restore or develop adequate wildlife 
        habitat.
            (8) Definitions.--In this subsection:
                    (A) The term ``Commission'' means the Fish and 
                Wildlife Conservation Commission established by this 
                subsection.
                    (B) The term ``Endowment'' means the National 
                Endowment for Fish and Wildlife established by this 
                subsection.
            (9) Conforming amendment.--Section 7 of the North American 
        Wetlands Conservation Act of 1989 (16 U.S.C. 4406) is amended 
        by adding at the end the following:
    ``(e) Fish and Wildlife Commission Funding.--In addition to the 
amounts made available under subsections (a), (b), and (c) of this 
section, the Council may receive funds from the Fish and Wildlife 
Commission to carry out the purposes of this Act. Use of such funds 
shall not be subject to the cost allocation requirements of section 8 
of this Act.''.

SEC. 9003. ALASKA POWER ADMINISTRATION SALE.

    (a) Definitions.--For purposes of this section:
            (1) The term ``Eklutna assets'' means the Eklutna 
        Hydroelectric Project and related assets as described in 
        section 4 and Exhibit A of the Eklutna Purchase Agreement.
            (2) The term ``Eklutna Purchase Agreement'' means the 
        August 2, 1989, Eklutna Purchase Agreement between the Alaska 
        Power Administration of the Department of Energy and the 
        Eklutna Purchasers, together with any amendments thereto which 
        were adopted before the enactment of this section.
            (3) The term ``Eklutna Purchasers'' means the Municipality 
        of Anchorage doing business as Municipal Light and Power, the 
        Chugach Electric Association, Inc. and the Matanuska Electric 
        Association, Inc.
            (4) The term ``Secretary'' means the Secretary of Energy 
        except where otherwise specified.
            (5) The term ``Snettishan assets'' means the Snettisham 
        Hydroelectric Project and related assets as described in 
        section 4 and Exhibit A of the Snettisham Purchase Agreement.
            (6) The term ``Snettisham Purchase Agreement'' means the 
        February 10, 1989, Snettisham Purchase Agreement between the 
        Alaska Power Administration of the Department of Energy and the 
        Alaska Power Authority and its successors in interest, together 
        with any amendments thereto which were adopted before the 
        enactment of this section.
    (b) Sale of Snettisham and Eklunta Assets.--
            (1) Snettisham.--The Secretary is authorized and directed 
        to sell and transfer the Snettisham assets to the State of 
        Alaska in accordance with the terms of this section and the 
        Snettisham Purchase Agreement.
            (2) Eklutna.--The Secretary is authorized and directed to 
        sell and transfer the Eklutna assets to the Eklutna Purchasers 
        in accordance with the terms of this section and the Eklutna 
        Purchase Agreement.
            (3) Cooperation of other agencies.--Other departments, 
        agencies, and instrumentalities of the United States shall 
        cooperate with the Secretary in implementing the sales and 
        transfers under this section.
            (4) Authorization of appropriations; contributed funds.--
        (A) There are authorized to be appropriated such sums as may be 
        necessary to prepare, survey, or acquire Snettisham and Eklutna 
        assets for sale and transfer under this section. Such 
        preparations and acquisitions shall provide sufficient title in 
        the assets to ensure beneficial use, enjoyment, and occupancy 
        thereof to the purchasers.
            (B) Notwithstanding any other provision of law, the Alaska 
        Power Administration is authorized to receive, administer, and 
        expend such contributed funds as may be provided by the Eklutna 
        Purchasers or customers or the Snettisham Purchasers or 
        customers for the purposes of upgrading, improving, 
        maintaining, or administering Eklutna or Snettisham. Upon the 
        termination of the Alaska Power Administration required under 
        subsection (d), the Secretary of Energy shall administer and 
        expend any remaining balances of such contributed funds for the 
        purposes intended by the contributors.
    (c) General Provisions.--
            (1) Rights-of-way and other lands for the eklutna 
        project.--With respect to Eklutna lands described in Exhibit A 
        of the Eklutna Purchase Agreement:
                    (A) The Secretary of the Interior shall issue 
                rights-of-way to the Alaska Power Administration for 
                subsequent reassignment to the Eklutna Purchasers at no 
                cost to the Eklutna Purchasers.
                    (B) Such rights-of-way shall remain effective for a 
                period equal to the life of the Eklutna hydroelectric 
                project as extended by improvements, repairs, renewals, 
                or replacements.
                    (C) Such rights-of-way shall be sufficient for the 
                operation, maintenance, repair, and replacement of, and 
                access to, the facilities of the Eklutna hydroelectric 
                project located on military lands and lands managed by 
                the Bureau of Land Management, including land selected 
                by, but not yet conveyed to, the State of Alaska.
                    (D) If the Eklutna Purchasers subsequently sell or 
                transfer the Eklutna hydroelectric project to private 
                ownership, the Bureau of Land Management may assess 
                reasonable and customary fees for continued use of the 
                rights-of-way on lands managed by the Bureau of Land 
                Management and military lands in accordance with 
                applicable law.
                    (E) The Secretary shall transfer fee title to lands 
                at Anchorage Substation to the Eklutna Purchasers at no 
                additional cost if the Secretary of the Interior 
                determines that pending claims to and selections of 
                those lands are invalid or relinquished.
                    (F) With respect only to the Eklutna lands 
                identified in Exhibit A of the Eklutna Purchase 
                Agreement, the State of Alaska may select, and the 
                Secretary of the Interior shall convey, to the State, 
                improved lands under the selection entitlements in 
                section 6 of the Alaska Statehood Act (Public Law 85-
                508; 72 Stat. 339) and the North Anchorage Land 
                Agreement of January 31, 1983. The conveyance of such 
                lands is subject to the rights-of-way provided to the 
                Eklutna Purchasers under subparagraph (A).
            (2) Lands for the snettisham project.--With respect to the 
        Snettisham lands identified in Exhibit A of the Snettisham 
        Purchase Agreement, the State of Alaska may select, and the 
        Secretary of the Interior shall convey to the State, improved 
        lands under the selection entitlement in section 6 of the 
        Alaska Statehood Act (Public Law 85-508; 72 Stat. 339).
            (3) Effect on state selections.--Notwithstanding the 
        expiration of the right of the State of Alaska to make 
        selections under section 6 of the Alaska Statehood Act (Public 
        Law 85-508; 72 Stat. 339), the State of Alaska may select lands 
        authorized for selection under this section or any Purchase 
        Agreement incorporated into or ratified by this section. The 
        State shall complete such selections within one year after the 
        date of the enactment of this section. The Secretary of the 
        Interior shall convey lands selected by the State under this 
        section notwithstanding the limitation contained in section 
        6(b) of the Alaska Statehood Act (Public Law 85-508; 72 Stat. 
        339) regarding the occupancy, appropriation, or reservation of 
        selected lands. Nothing in this subsection shall be construed 
        to authorize the Secretary of the Interior to convey to the 
        State of Alaska a total acreage of selected lands in excess of 
        the total acreage which could be transferred to the State of 
        Alaska pursuant to the Alaska Statehood Act (Public Law 85-508; 
        72 Stat. 339), and other applicable law.
            (4) Repeal of act of august 9, 1955.--The Act of August 9, 
        1955 (69 Stat. 618), concerning water resources investigations 
        in Alaska, is repealed.
            (5) Treatment of asset sale.--The sales of assets under 
        this section shall not be considered a disposal of Federal 
        surplus property under the Federal Property and Administrative 
        Services Act of 1949 (40 U.S.C. 484) or the Surplus Property 
        Act of 1944 (50 U.S.C. App. 1622).
            (6) Application of certain laws.--(A) The Act of July 31, 
        1950 (64 Stat. 382), shall cease to apply on the date, as 
        determined by the Secretary, when all Eklutna assets have been 
        conveyed to the Eklutna Purchasers.
            (B) Section 204 of the Flood Control Act of 1962 (Public 
        Law 87-874; 76 Stat. 1193) shall cease to apply effective on 
        the date, as determined by the Secretary, when all Snettisham 
        assets have been conveyed to the State of Alaska.
    (d) Termination of Alaska Power Administration.--
            (1) Termination of alaska power administation.--Not later 
        than one year after both of the sales authorized in this 
        section have occurred, as measured by the Transaction Dates 
        stipulated in the Purchase Agreements, the Secretary shall--
                    (A) complete the business of, and close out, the 
                Alaska Power Administration;
                    (B) prepare and submit to Congress a report 
                documenting the sales; and
                    (C) return unobligated balances of funds 
                appropriated for the Alaska Power Administration to the 
                Treasury of the United States.
            (2) DOE organization act.--Section 302(a) of the Department 
        of Energy Organization Act (42 U.S.C. 7152(a)) is amended as 
        follows:
                    (A) In paragraph (1)--
                            (i) by striking out subparagraph (C); and
                            (ii) by redesignating subparagraphs (D), 
                        (E), and (F) as subparagraphs (C), (D), and (E) 
                        respectively.
                    (B) In paragraph (2), by striking out ``the 
                Bonneville Power Administration, and the Alaska Power 
                Administration'' and inserting in lieu thereof ``and 
                the Bonneville Power Administration''.
        The amendments made by this paragraph shall take effect on the 
        date on which the Secretary submits the report referred to in 
        subparagraph (B) of paragraph (1).
    (e) Proceeds.--The proceeds from the sale of Snettisham and Eklutna 
assets under this section shall be credited to miscellaneous receipts 
in the Treasury.

                      PART 2--HELIUM PRIVATIZATION

SEC. 9011. SHORT TITLE.

    This part may be cited as the ``Helium Privatization Act of 1995''.

SEC. 9012. AMENDMENT OF HELIUM ACT.

    Except as otherwise expressly provided, whenever in this part an 
amendment or repeal is expressed in terms of an amendment to, or repeal 
of, a section or other provision, the reference shall be considered to 
be made to a section or other provision of the Helium Act (50 U.S.C. 
167 to 167n).

SEC. 9013. AUTHORITY OF SECRETARY.

    Sections 3, 4, and 5 are amended to read as follows:

``SEC. 3. AUTHORITY OF SECRETARY.

    ``(a) Extraction and Disposal of Helium on Federal Lands.--(1) The 
Secretary may enter into agreements with private parties for the 
recovery and disposal of helium on Federal lands upon such terms and 
conditions as he deems fair, reasonable and necessary. The Secretary 
may grant leasehold rights to any such helium. The Secretary may not 
enter into any agreement by which the Secretary sells such helium other 
than to a private party with whom the Secretary has an agreement for 
recovery and disposal of helium. Such agreements may be subject to such 
rules and regulations as may be prescribed by the Secretary.
    ``(2) Any agreement under this subsection shall be subject to the 
existing rights of any affected Federal oil and gas lessee. Each such 
agreement (and any extension or renewal thereof) shall contain such 
terms and conditions as deemed appropriate by the Secretary.
    ``(3) This subsection shall not in any manner affect or diminish 
the rights and obligations of the Secretary and private parties under 
agreements to dispose of helium produced from Federal lands in 
existence at the enactment of the Helium Privatization Act of 1995 
except to the extent that such agreements are renewed or extended after 
such date.
    ``(b) Storage, Transportation, and Sale.--The Secretary is 
authorized to store, transport, and sell helium only in accordance with 
this Act.
    ``(c) Monitoring and Reporting.--The Secretary is authorized to 
monitor helium production and helium reserves in the United States and 
to periodically prepare reports regarding the amounts of helium 
produced and the quantity of crude helium in storage in the United 
States.

``SEC. 4. STORAGE, TRANSPORTATION, AND WITHDRAWAL OF CRUDE HELIUM.

    ``(a) Storage, Transportation, and Withdrawal.--The Secretary is 
authorized to store and transport crude helium and to maintain and 
operate existing crude helium storage at the Bureau of Mines Cliffside 
Field, together with related helium transportation and withdrawal 
facilities.
    ``(b) Cessation of Production, Refining, and Marketing.--Effective 
18 months after the date of enactment of the Helium Privatization Act 
of 1995, the Secretary shall cease producing, refining and marketing 
refined helium and shall cease carrying out all other activities 
relating to helium which the Secretary was authorized to carry out 
under this Act before the date of enactment of the Helium Privatization 
Act of 1995, except those activities described in subsection (a). The 
amount of helium reserves owned by the United States and stored in the 
Bureau of Mines Cliffside Field at such date of cessation, less 
600,000,000 cubic feet, shall be the helium reserves owned by the 
United States required to be sold pursuant to section 8(b) hereof.
    ``(c) Disposal of Facilities.--(1) Within two years after the date 
on which the Secretary ceases producing, refining and marketing refined 
helium and ceases all other activities relating to helium in accordance 
with subsection (b), the Secretary shall dispose of all facilities, 
equipment, and other real and personal property, together with all 
interests therein, held by the United States for the purpose of 
producing, refining and marketing refined helium. The disposal of such 
property shall be in accordance with the provisions of law governing 
the disposal of excess or surplus properties of the United States.
    ``(2) All proceeds accruing to the United States by reason of the 
sale or other disposal of such property shall be treated as moneys 
received under this chapter for purposes of section 6(f). All costs 
associated with such sale and disposal (including costs associated with 
termination of personnel) and with the cessation of activities under 
subsection (b) shall be paid from amounts available in the helium 
production fund established under section 6(f).
    ``(3) Paragraph (1) shall not apply to any facilities, equipment, 
or other real or personal property, or any interest therein, necessary 
for the storage and transportation of crude helium or any equipment 
needed to maintain the purity, quality control, and quality assurance 
of helium in the reserve.
    ``(d) Existing Contracts.--All contracts which were entered into by 
any person with the Secretary for the purchase by such person from the 
Secretary of refined helium and which are in effect on the date of the 
enactment of the Helium Privatization Act of 1995 shall remain in force 
and effect until the date on which the facilities referred to in 
subsection (c) are disposed of. Any costs associated with the 
termination of such contracts shall be paid from the helium production 
fund established under section 6(f).

``SEC. 5. FEES FOR STORAGE, TRANSPORTATION AND WITHDRAWAL.

    ``Whenever the Secretary provides helium storage, withdrawal, or 
transportation services to any person, the Secretary is authorized and 
directed to impose fees on such person to reimburse the Secretary for 
the full costs of providing such storage, transportation, and 
withdrawal. All such fees received by the Secretary shall be treated as 
moneys received under this Act for purposes of section 6(f).''.

SEC. 9014. SALE OF CRUDE HELIUM.

    Section 6 is amended as follows:
            (1) Subsection (a) is amended by striking out ``from the 
        Secretary'' and inserting ``from persons who have entered into 
        enforceable contracts to purchase an equivalent amount of crude 
        helium from the Secretary''.
            (2) Subsection (b) is amended by inserting ``crude'' before 
        ``helium'' and by adding the following at the end thereof: 
        ``Except as may be required by reason of subsection (a), the 
        Secretary shall not make sales of crude helium under this 
        section in such amounts as will disrupt the market price of 
        crude helium.''.
            (3) Subsection (c) is amended by inserting ``crude'' before 
        ``helium'' the first place it appears and by striking 
        ``together with interest as provided in subsection (d) of this 
        section'' and all that follows down through the period at the 
        end of such subsection and inserting the following:
``all funds required to be repaid to the United States as of October 1, 
1995, under this section (hereinafter referred to as `repayable 
amounts'). The price at which crude helium is sold by the Secretary 
shall not be less than the amount determined by the Secretary as 
follows:
            ``(1) Divide the outstanding amount of such repayable 
        amounts by the volume (in mcf) of crude helium owned by the 
        United States and stored in the Bureau of Mines Cliffside Field 
        at the time of the sale concerned.
            ``(2) Adjust the amount determined under paragraph (1) by 
        the Consumer Price Index for years beginning after December 31, 
        1995.''.
            (4) Subsection (d) is amended to read as follows:
    ``(d) Extraction of Helium From Deposits on Federal Lands.--All 
moneys received by the Secretary from the sale or disposition of helium 
on Federal lands shall be paid to the Treasury and credited against the 
amounts required to be repaid to the Treasury under subsection (c) of 
this section.''.
            (5) Subsection (e) is repealed.
            (6) Subsection (f) is amended by inserting ``(1)'' after 
        ``(f)'' and by adding the following at the end thereof:
    ``(2) Within 7 days after the commencement of each fiscal year 
after the disposal of the facilities referred to in section 4(c), all 
amounts in such fund in excess of $2,000,000 (or such lesser sum as the 
Secretary deems necessary to carry out this Act during such fiscal 
year) shall be paid to the Treasury and credited as provided in 
paragraph (1). Upon repayment of all amounts referred to in subsection 
(c), the fund established under this section shall be terminated and 
all moneys received under this Act shall be deposited in the Treasury 
as General Revenues.''.

SEC. 9015. ELIMINATION OF STOCKPILE.

    Section 8 is amended to read as follows:

``SEC. 8. ELIMINATION OF STOCKPILE.

    ``(a) Review of Reserves.--The Secretary shall review annually the 
known helium reserves in the United States and make a determination as 
to the expected life of the domestic helium reserves (other than 
Federally owned helium stored at the Cliffside Reservoir) at that time.
    ``(b) Stockpile Sales.--Not later than January 1, 2005, the 
Secretary shall commence offering for sale crude helium from helium 
reserves owned by the United States in such minimum annual amounts as 
would be necessary to dispose of all such helium reserves in excess of 
600,000,000 cubic feet (mcf) on a straight-line basis between such date 
and January 1, 2015: Provided, That the minimum price for all such 
sales, as determined by the Secretary in consultation with the helium 
industry, shall be such as will ensure repayment of the amounts 
required to be repaid to the Treasury under section 6(c), and provided 
further that the minimum annual sales requirement may be deferred only 
if, and to the extent that, the Secretary is unable to arrange sales at 
the minimum price. The sales shall be at such times during each year 
and in such lots as the Secretary determines, in consultation with the 
helium industry, are necessary to carry out this subsection with 
minimum market disruption.
    ``(c) Discovery of Additional Reserves.--The discovery of 
additional helium reserves shall not affect the duty of the Secretary 
to make sales of helium as provided in subsection (b), as the case may 
be.''.

SEC. 9016. REPEAL OF AUTHORITY TO BORROW.

    Sections 12 and 15 are repealed.

SEC. 9017. REPORTS.

    Section 16 is amended by redesignating existing section 16 as 
section 16(a) and inserting the following at the end thereof:
    ``(b)(1) The Inspector General of the Department of the Interior 
shall cause to be prepared, not later than March 31 following each 
fiscal year commencing with the date of enactment of the Helium 
Privatization Act of 1995, annual financial statements for the Helium 
Operations of the Bureau of Mines. The Director of the Bureau of Mines 
shall cooperate with the Inspector General in fulfilling this 
requirement, and shall provide him with such personnel and accounting 
assistance as may be necessary for that purpose. The financial 
statements shall be audited by the General Accounting Office, and a 
report on such audit shall be delivered by the General Accounting 
Office to the Secretary of the Interior and Congress, not later than 
June 30 following the end of the fiscal year for which they are 
prepared. The audit shall be prepared in accordance with generally 
accepted government auditing standards.
    ``(2) The financial statements shall be comprised of the following:
            ``(A) A balance sheet reflecting the overall financial 
        position of the Helium Operations, including assets and 
        liabilities thereof;
            ``(B) the Statement of Operations, reflecting the fiscal 
        period results of the Helium Operations;
            ``(C) a statement cash flows or changes in financial 
        position of the Helium Operations; and
            ``(D) a reconciliation of budget reports of the Helium 
        Operations.
    ``(3) The Statement of Operations shall include but not be limited 
to the revenues from, and costs of, sales of crude helium, the storage 
and transportation of crude helium, the production, refining and 
marketing of refined helium, and the maintenance and operation of 
helium storage facilities at the Bureau of Mines Cliffside Field. The 
term `revenues' for this purpose shall exclude (A) royalties paid to 
the United States for production of helium or other extraction of 
resources, except to the extent that the Helium Operations incur direct 
costs in connection therewith, and (B) proceeds from sales of assets 
other than inventory. The term `expenses' shall include, but not be 
limited to (i) all labor costs of the Bureau of Mines Helium 
Operations, and of the Department of the Interior in connection 
therewith, and (ii) for financial reporting purposes but not in 
connection with the determination of sales prices in section 6(c), all 
current-period interest on outstanding repayable amounts (as described 
in section 6(c)) calculated at the same rates as such interest was 
calculated prior to the enactment of the Helium Privatization Act of 
1995.
    ``(4) The balance sheet shall include, but not be limited to, on 
the asset side, the present discounted market value of crude helium 
reserves; and on the liability side, the accrued liability for 
principal and interest on debt to the United States. For financial 
reporting purposes but not in connection with the determination of 
sales prices in section 6(c), the balance sheet shall also include 
accrued but unpaid interest on outstanding repayable amounts (as 
described in section 6(c)) through the date of the report, calculated 
at the same rates as such interest was calculated prior to the 
enactment of the Helium Privatization Act of 1995.''.

SEC. 9018. LAND CONVEYANCE IN POTTER COUNTY, TEXAS.

    (a) In General.--The Secretary of the Interior shall transfer all 
right, title, and interest of the United States in and to the parcel of 
land described in subsection (b) to the Texas Plains Girl Scout Council 
for consideration of $1, reserving to the United States such easements 
as may be necessary for pipeline rights-of-way.
    (b) Land Description.--The parcel of land referred to in subsection 
(a) is all those certain lots, tracts or parcels of land lying and 
being situated in the County of Potter and State of Texas, and being 
the East Three Hundred Thirty-One (E331) acres out of Section Seventy-
eight (78) in Block Nine (9), B.S. & F. Survey, (sometimes known as the 
G. D. Landis pasture) Potter County, Texas, located by certificate No. 
1/39 and evidenced by letters patents Nos. 411 and 412 issued by the 
State of Texas under date of November 23, 1937, and of record in Vol. 
66A of the Patent Records of the State of Texas. The metes and bounds 
description of such lands is as follows:
            (1) First tract.--One Hundred Seventy-one (171) acres of 
        land known as the North part of the East part of said survey 
        Seventy-eight (78) aforesaid, described by metes and bounds as 
        follows:
                Beginning at a stone 20 x 12 x 3 inches marked X, set 
                by W. D. Twichell in 1905, for the Northeast corner of 
                this survey and the Northwest corner of Section 59;
                Thence, South 0 degrees 12 minutes East with the West 
                line of said Section 59, 999.4 varas to the Northeast 
                corner of the South 160 acres of East half of Section 
                78:
                Thence, North 89 degrees 47 minutes West with the North 
                line of the South 150 acres of the East half, 956.8 
                varas to a point in the East line of the West half 
                Section 78:
                Thence North 0 degrees 10 minutes West with the East 
                line of the West half 999.4 varas to a stone 18 x 14 x 
                3 inches in the middle of the South line of Section 79;
                Thence South 89 degrees 47 minutes East 965 varas to 
                the place of beginning.
            (2) Second tract.--One Hundred Sixty (160) acres of land 
        known as the South part of the East part of said survey No. 
        Seventy-eight (78) described by metes and bounds as follows:
                Beginning at the Southwest corner of Section 59, a 
                stone marked X and a pile of stones;
                Thence North 89 degrees 47 minutes West with the North 
                line of Section 77, 966.5 varas to the Southeast corner 
                of the West half of Section 78;Thence North 0 degrees 
                10 minutes West with the East line of the West half of 
                Section 78;
                Thence South 89 degrees 47 minutes East 965.8 varas to 
                a point in the East line of Section 78;
                Thence South 0 degrees 12 minutes East 934.6 varas to 
                the place of beginning.
        Containing an area of 331 acres, more or less.

                      Subtitle B--Water and Power

                PART 1--POWER MARKETING ADMINISTRATIONS

SEC. 9201. SHORT TITLE.

    This part may be cited as the ``Power Administration Act''.

SEC. 9202. SALE OF THE SOUTHEASTERN POWER ADMINISTRATION.

    (a) Sale of the Southeastern Power Administration Assets.--The 
Secretary of Energy (hereafter in this part referred to as the 
``Secretary'') is authorized and directed to sell the facilities used 
to generate the electric power marketed by the Southeastern Power 
Administration, including all dams, locks, reservoirs, and related 
transmission and generation structures, equipment, facilities and real 
property (including rights-of-way) which are used in connection with 
the operation of such power generation facilities. The sale shall also 
include all contracts, marketing agreements, and any and all other 
rights, interests, and obligations held or owed by the Southeastern 
Power Administration. Each sale shall be subject to all existing 
storage rights in such reservoirs acquired by local interests pursuant 
to the Water Supply Act of 1958 (Public Law 85-500; 43 U.S.C. 390b) and 
sections 1, 2, and 3 of Public Law 88-140 (43 U.S.C. 390c through 390e) 
for water supply or other purposes and all such rights shall survive 
such sale; all obligations of the United States under contracts with 
such local interests for the use of such storage shall be assumed by 
any purchaser so that such local interests may continue to operate and 
utilize their storage in accordance with their existing contracts with 
the United States without entering into an additional contract with the 
United States or the purchaser, notwithstanding any provision of law or 
contract to the contrary. In order to assure that the facilities are 
transferred in a manner that provides a reasonable payment to the 
United States, sales under this section shall be made through a 
competitive bidding process open to all bidders determined by the 
Secretary to be financially qualified and who have the experience and 
resources necessary to manage the transferred assets. No facility or 
group of facilities may be sold for an amount less than the minimum bid 
established and published by the Secretary. The minimum bid shall be 
equal to the net present value of the outstanding debt repayable to the 
United States and attributable to the facility or group of facilities 
concerned.
    (b) Cooperation of Other Agencies.--The heads of other affected 
Federal departments and agencies shall assist the Secretary in 
implementing the sales authorized by this section. Upon receiving a 
written request from the Secretary, the head of any such department or 
agency having administrative jurisdiction over any facility to be sold 
under this section shall transfer (at such time as may be specified by 
the Secretary in such request) such facility to the Secretary for 
purposes of effectuating such sale.
    (c) Financial and Bid Management Advisor.--
            (1) Retention of advisor.--Within six months of the date of 
        enactment of this Act, the Secretary shall retain an 
        experienced private sector firm to serve as financial and bid 
        management advisor (hereinafter ``advisor'') to the Secretary 
        with respect to such sales. The advisor shall not have any 
        substantial financial interest in the existing assets, their 
        operation or the ultimate purchasers.
            (2) Notice.--Within six months after the date of enactment 
        of this Act, the Secretary shall also publish a notice in the 
        Federal Register soliciting all parties which have an 
        operational or ownership interest in the Southeast Power 
        Administration to provide evidence of such interest within 90 
        days of the published notice.
            (3) Advisor's report.--Within six months of being retained 
        by the Secretary and based on information provided by the 
        Secretary and the information obtained in paragraph (2), the 
        advisor shall provide to the Secretary a report containing each 
        of the following:
                    (A) A plan for the competitive sale of all assets 
                and interests, held by the Southeastern Power 
                Administration, out of Federal ownership and operation.
                    (B) An estimate of the net present value of the 
                income expected to be derived over the next 50 years 
                from each facility or group of facilities to be sold 
                under this section.
                    (C) An estimate of the net present value of the 
                expenses expected to be incurred over the next 50 years 
                in connection with each facility or group of facilities 
                to be sold under this section.
                    (D) a comparison between the net of subparagraphs 
                (A) and (B) and the net present value of the 
                outstanding debt which the Federal government 
                attributes to the asset being sold.
                    (E) The options for the grouping of facilities to 
                be sold under this section. The transfer shall be 
                structured to transfer assets and interests of the 
                Southeast Power Administration by watershed or by 
                project unless the Advisor can provide satisfactory 
                information to the Secretary that another alternative 
                should be used. Groupings of assets shall specifically 
                be designed to transfer all assets in a manner that 
                provides reasonable payment to the United States of all 
                assets within the Southeast Power Administration.
    (d) Proceeds.--The Secretary is directed to use up to $6,000,000 
from unobligated balances available to the Department of Energy to fund 
any sale preparation costs or studies provided for in this section, and 
shall provide an accounting of all sale preparation costs and studies 
to the Committee on Resources of the House of Representatives and to 
the Committee on Energy and Natural Resources of the Senate within 60 
days after completion of the sale or study. The proceeds of any sale of 
a facility or group of facilities under this section shall be used 
first to offset the costs of carrying out such sale or study and the 
remaining net proceeds shall be deemed to extinguish the outstanding 
debt repayable to the United States and attributable to such facility 
or group of facilities. Any portion of such net proceeds which exceeds 
the net present value of the outstanding debt repayable to the United 
States and attributable to the facility or group of facilities 
concerned shall be deposited in the Treasury of the United States as 
miscellaneous receipts.
    (e) Treatment of Sales for Purposes of Certain Laws.--The sales of 
assets under this part shall not be considered a disposal of Federal 
surplus property under the following provisions of law:
            (1) Section 203 of the Federal Property and Administrative 
        Services Act of 1949 (40 U.S.C. 484).
            (2) Section 13 of the Surplus Property Act of 1944 (50 
        U.S.C. App. 1622).
    (f) Existing Contracts, Uses, Etc.--All sales of assets and rights 
under this section shall be subject to all contracts, debt obligations 
to non-Federal entities, and other binding agreements which apply, as 
of the date of such sale, to the facilities concerned and to the sale 
of electric power from such facilities. The purchaser of each such 
facility shall assume all liabilities and obligations of the United 
States under such contracts, obligations or other agreements. The 
Southeastern Power Administration shall not, after the date of 
enactment of this Act, enter into a long-term agreement, contract, or 
other long-term obligation or responsibility, except to the extent that 
such an obligation is essential to the continued operation of the 
Southeastern Power Administration or will significantly enhance or 
maintain the value of a facility after it is transferred. The United 
States shall remain responsible for concluding all lawsuits associated 
with the assets which are the subject of a transfer and which are 
extant as of the date of the enactment of this Act, whether in its 
capacity of plaintiff or defendant. Any right, title, or interest of 
the United States which exists at the conclusion of such lawsuits and 
which would otherwise have been transferred, but for the lawsuit, shall 
be transferred to the party in interest who acquired the related asset 
from the United States. The United States shall remain responsible for 
any outstanding Indian trust responsibilities, unless the transfer in 
question specifically identifies the obligation being transferred.
    (g) Report to FERC.--Not later than June 30, 1997, the Secretary 
shall provide each of the following to the Federal Energy Regulatory 
Commission each of the following:
            (1) A description of--
                    (A) all the assets tangible and intangible that 
                comprise each hydroelectric project to be sold under 
                this section;
                    (B) the existing terms of operation with respect to 
                such hydroelectric project; and
                    (C) any other interest being proposed for transfer.
            (2) The information pertaining to such hydroelectric 
        project required by title 18 of the Code of Federal 
        Regulations, subparts B and F, or G, as appropriate, except 
        exhibit E.
            (3) The date when an offer for purchase of the assets must 
        be submitted.
    (h) Notice of Sale and Solicitation of Bids.--Not later than March 
31, 1998, the Secretary shall publish a notice in the Federal Register 
which includes each of the following:
            (1) A description of--
                    (A) all the assets tangible and intangible that 
                comprise each hydroelectric project to be sold under 
                this section;
                    (B) the existing terms of operation with respect to 
                such hydroelectric project; and
                    (C) any other interest being proposed for transfer.
            (2) The date, time, and conditions of the bids that must be 
        met to submit a successful bid for the assets to be sold under 
        this part.
            (3) The terms and conditions identified in the proposed 
        license provided from the Federal Energy Regulatory Commission 
        to the Secretary under this part.
    (i) Date of Sale.--All sales under this section shall be completed 
between July 1, 1999, and September 30, 1999.
    (j) Termination of the Southeastern Power Administration.--
Following the sale of all facilities referred to in subsection (a), the 
Secretary shall complete the business of and close out the Southeast 
Power Administration and return the unexpended balances of funds 
appropriated for the Administration to the Treasury of the United 
States. To the extent practical, the purchasers under this section 
should, consistent with good business practices, attempt to offer to 
employ those former employees of the Southeastern Power Administration 
who are necessary to the continued operation of such facilities 
following the sale of the facilities.

SEC. 9203. FEDERAL ENERGY REGULATORY COMMISSION JURISDICTION.

    (a) Regulation of Rates and Charges.--All rates and charges 
established for the wholesale sale of electric power from facilities 
sold under section 9202 shall be subject to part 2 of the Federal Power 
Act. This subsection shall take effect upon the expiration of any 
contract which is applicable to the sale of such electric power on the 
date of the sale of the facility concerned. In approving, disapproving 
or establishing rates and charges for the sale of electric power from 
any facility sold under section 9202, the Federal Energy Regulatory 
Commission shall determine the extent to which any proposed increase in 
any such rate or charge is attributable to the sale of such facility. 
The Commission shall disallow any such increase to the extent the 
increase is attributable to such sale and is greater than \1/2\ of the 
increase (between the date of sale of the facility and the date on 
which the application for a rate increase is filed) in the Consumer 
Price Index (published by the Bureau of Labor Statistics) for the 
region in which such power is sold. For purposes of determining the 
amount of a proposed increase in a rate or charge for the sale of 
electric power from any facility sold under section 9202, the increase 
shall be measured from the rates and charges in effect on date of the 
sale of the facility. This subsection applies to all wholesale 
purchasers who, for the calendar year ending immediately prior to the 
year in which this Act is enacted, received at least 20 percent of 
their power from the Southeastern Power Administration.
    (b) Original License.--Not later than January 1, 1998, the Federal 
Energy Regulatory Commission shall provide the Secretary with a 
proposed license for each hydroelectric project to be sold under 
section 9202. Not later than September 30, 1999, the Commission shall 
issue to the purchaser of each hydroelectric project sold under section 
9202 a license under part I of the Federal Power Act (16 U.S.C. 791a-
823b) authorizing the continued operation and maintenance of such 
project for a term of 30 years. Such license shall--
            (1) be for the project purposes established by the existing 
        terms of operation and shall be consistent with the proposed 
        license provided to the Secretary;
            (2) be conditioned upon the requirement that the licensed 
        project continue to be operated and maintained in accordance 
        with the existing terms of operation, except that the licensee 
        may make improvements to the project which increase capacity 
        without amendment to the license so long as existing minimum 
        flows are not affected;
            (3) be subject only to the appropriate standard ``L-Form'' 
        license conditions, published at 54 FPC 1792-1928 (1975), 
        except that the license may not be reopened for any purpose for 
        the first 10 years of the license;
            (4) provide a 10-year period for the licensee to meet the 
        Commission's dam safety regulations, set forth at title 18 of 
        the Code of Federal Regulations, part 12;
            (5) not be subject to: the word ``constructed'' in section 
        3(10), the 4 provisos of section 4(e); section 6 to the extent 
        it requires the licensee's acceptance of those terms and 
        conditions of the Act that this subsection waives; section 
        10(e) as it concerns annual charges for the use and occupancy 
        of Federal lands and facilities; section 10(f), section 10(j), 
        section 18, section 19, section 20, and section 22 of the 
        Federal Power Act (16 U.S.C. 796(10), 797(e), 799, 803(e), 
        803(f), 803(j), 811, 812, 813, and 815); and
            (6) contain minimum flow restrictions no more restrictive 
        than those currently in effect, if any, such minimum flow 
        restrictions may not be altered during the primary term of the 
        license.
    (c) Acts Applicable to Licensing.--The issuance of a license 
pursuant to subsection (b) shall not be subject to the provisions of 
the Federal Land Policy and Management Act of 1976, section 2402 of the 
Energy Policy Act of 1992, the National Environmental Policy Act of 
1969, the Endangered Species Act of 1973, the Wild and Scenic Rivers 
Act, the Federal Water Pollution Control Act, the National Historic 
Preservation Act, the Coastal Zone Management Act, the Fish and 
Wildlife Coordination Act, or any other Act otherwise applicable to the 
licensing of the projects.
    (d) Effect of License.--A license issued under subsection (b)--
            (1) is deemed to meet the licensing standards of the 
        Federal Power Act, including section 10(a) and the last 
        sentence of section 4(e) (16 U.S.C. 797(e)); and
            (2) shall constitute the sole and exclusive source for a 
        transferred hydroelectric project of authorizations and 
        requirements with respect to project operation.
    (e) Reservations.--Any power site reservation established by the 
President, the Department of the Interior, or pursuant to section 24 of 
the Federal Power Act (16 U.S.C. 818), or any other law, which exists 
on any lands, whether Federally or privately owned, that are included 
within the final project boundaries of a transferred hydroelectric 
project as approved by the Commission shall be vacated by operation of 
law upon issuance of a license for such project.
    (f) Relicensing.--All requirements of part I of the Federal Power 
Act and of any other Act applicable to the licensing of a hydroelectric 
project shall apply to a transferred hydroelectric project upon 
expiration of an original license issued under this section.
    (g) Definitions.--For purposes of this section:
            (1) The term ``Commission'' means the Federal Energy 
        Regulatory Commission.
            (2) The term ``existing terms of operation'' means any 
        applicable statutes, executive department regulations, orders, 
        rule curves and the like, memoranda of agreement, and 
        contractual arrangements pertaining to a transferred 
        hydroelectric project that were in effect as of the date of 
        enactment of this Act.
            (3) The term ``transferred hydroelectric project'' means 
        the facilities, land, and other assets sold or to be sold to a 
        transferee under this part and noticed by the Secretary, 
        including any such land, facilities, or assets that comprise a 
        project as defined in section 3(11) of the Federal Power Act 
        (16 U.S.C. 796(11)).

SEC. 9204. EVALUATION OF SALES OF SOUTHWESTERN POWER ADMINISTRATION AND 
                    WESTERN AREA POWER ADMINISTRATION FACILITIES.

    (a) Enabling Federal Studies.--Section 505 of the Energy and Water 
Development Appropriations Act of 1993 (Public Law 102-377) is hereby 
repealed.
    (b) Evaluation of Issues.--The Secretary of Energy and the 
Secretary of the Interior shall enter into arrangements with an 
experienced private sector firm to serve as advisor to the Secretary 
with respect to the sale of the facilities used to generate and 
transmit the electric power marketed by the Southwestern Power 
Administration and the Western Area Power Administration, including all 
dams, locks, reservoirs, transmission and related structures, 
equipment, facilities and all real and tangible property (including 
rights-of-way) which are used in connection with such power generation 
and transmission facilities. Prior to December 31, 1996, the advisor 
shall provide to the Secretary and the Congress a report identifying 
all recipients of water and power from such facilities, all contracts, 
debt obligations, equity interests, and other binding agreements which 
apply to the facilities concerned and to the sale of electric power 
from such facilities, all assets tangible and intangible, all 
applicable requirements relating to environmental mitigation, Indian 
trust responsibilities, land ownership or use rights relevant to the 
proposed transfers which could terminate based on a transfer out of 
Federal ownership, and navigational requirements which affect the 
operation of such facilities. Such evaluation shall also include an 
evaluation of the tax consequences, and the revenue impacts of such 
consequences for the United States, of possible arrangements for the 
sale of such facilities to potential transferees. The report shall also 
investigate alternative groupings of the facilities for purposes of 
sale in order to determine which groupings would be most desirable for 
purposes of effectuating such sales. Proposed transfers should be 
structured by watershed or by project unless the advisor can provide 
satisfactory information to the Secretary that another alternative 
should be used. Asset groupings shall specifically be designed to 
effectuate the maximum return for all of the assets.

SEC. 9205. BONNEVILLE POWER ADMINISTRATION APPROPRIATIONS REFINANCING.

    (a) Definitions.--For the purposes of this section:
            (1) The term ``Administrator'' means the Administrator of 
        the Bonneville Power Administration.
            (2) The term ``capital investment'' means a capitalized 
        cost funded by Federal appropriations that--
                    (A) is for a project, facility, or separable unit 
                or feature of a project or facility;
                    (B) is a cost for which the Administrator is 
                required by law to establish rates to repay to the 
                United States Treasury through the sale of electric 
                power, transmission, or other services;
                    (C) excludes a Federal irrigation investment; and
                    (D) excludes an investment financed by the current 
                revenues of the Administrator or by bonds issued and 
                sold, or authorized to be issued and sold, by the 
                Administrator under section 13 of the Federal Columbia 
                River Transmission System Act (16 U.S.C. 838(k)).
            (3) The term ``new capital investment'' means a capital 
        investment for a project, facility, or separable unit or 
        feature of a project or facility, placed in service after 
        September 30, 1995.
            (4) The term ``old capital investment'' means a capital 
        investment whose capitalized cost--
                    (A) was incurred, but not repaid, before October 1, 
                1995; and
                    (B) was for a project, facility, or separable unit 
                or feature of a project or facility, placed in service 
                before October 1, 1995.
            (5) The term ``repayment date'' means the end of the period 
        within which the Administrator's rates are to assure the 
        repayment of the principal amount of a capital investment.
            (6) The term ``Treasury rate'' means--
                    (A) for an old capital investment, a rate 
                determined by the Secretary of the Treasury, taking 
                into consideration prevailing market yields, during the 
                month preceding October 1, 1995, on outstanding 
                interest-bearing obligations of the United States with 
                periods to maturity comparable to the period between 
                October 1, 1995, and the repayment date for the old 
                capital investment; and
                    (B) for a new capital investment, a rate determined 
                by the Secretary of the Treasury, taking into 
                consideration prevailing market yields, during the 
                month preceding the beginning of the fiscal year in 
                which the related project, facility, or separable unit 
                or feature is placed in service, on outstanding 
                interest-bearing obligations of the United States with 
                periods to maturity comparable to the period between 
                the beginning of the fiscal year and the repayment date 
                for the new capital investment.
    (b) New Principal Amounts.--(1) Effective October 1, 1995, an old 
capital investment shall have a new principal amount that is the sum 
of--
            (A) the present value of the old payment amounts for the 
        old capital investment, calculated using a discount rate equal 
        to the Treasury rate for the old capital investment; and
            (B) an amount equal to $100,000,000 multiplied by a 
        fraction whose numerator is the principal amount of the old 
        payment amounts for the old capital investment and whose 
        denominator is the sum of the principal amounts of the old 
        payment amounts for all old capital investments.
    (2) With the approval of the Secretary of the Treasury based solely 
on consistency with this Act, the Administrator shall determine the new 
principal amounts under paragraph (1) and the assignment of interest 
rates to the new principal amounts under subsection (c).
    (3) For the purposes of this section, ``old payment amounts'' 
means, for an old capital investment, the annual interest and principal 
that the Administrator would have paid to the United States Treasury 
from October 1, 1995, if this section were not enacted, assuming that--
            (A) the principal were repaid--
                    (i) on the repayment date the Administrator 
                assigned before October 1, 1993, to the old capital 
                investment, or
                    (ii) with respect to an old capital investment for 
                which the Administrator has not assigned a repayment 
                date before October 1, 1993, on a repayment date the 
                Administrator shall assign to the old capital 
                investment in accordance with paragraph 10(d)(1) of the 
                version of Department of Energy Order RA 6120.2 in 
                effect on October 1, 1993; and
            (B) interest were paid--
                    (i) at the interest rate the Administrator assigned 
                before October 1, 1993, to the old capital investment, 
                or
                    (ii) with respect to an old capital investment for 
                which the Administrator has not assigned an interest 
                rate before October 1, 1993, at a rate determined by 
                the Secretary of the Treasury, taking into 
                consideration prevailing market yields, during the 
                month preceding the beginning of the fiscal year in 
                which the related project, facility, or separable unit 
                or feature is placed in service, on outstanding 
                interest-bearing obligations of the United States with 
                periods to maturity comparable to the period between 
                the beginning of the fiscal year and the repayment date 
                for the old capital investment.
    (c) Interest Rate for New Principal Amounts.--As of October 1, 
1995, the unpaid balance on the new principal amount established for an 
old capital investment under subsection (b) shall bear interest 
annually at the Treasury rate for the old capital investment until the 
earlier of the date that the new principal amount is repaid or the 
repayment date for the new principal amount.
    (d) Repayment Dates.--As of October 1, 1995, the repayment date for 
the new principal amount established for an old capital investment 
under subsection (b) shall be no earlier than the repayment date for 
the old capital investment assumed in subsection (b)(3)(A).
    (e) Prepayment Limitations.--During the period October 1, 1995, 
through September 30, 2000, the total new principal amounts of old 
capital investments, as established under subsection (b), that the 
Administrator may pay before their respective repayment dates shall not 
exceed $100,000,000.
    (f) Interest Rates for New Capital Investments During 
Construction.--(1) The principal amount of a new capital investment 
includes interest in each fiscal year of construction of the related 
project, facility, or separable unit or feature at a rate equal to the 
one-year rate for the fiscal year on the sum of--
            (A) construction expenditures that were made from the date 
        construction commenced through the end of the fiscal year, and
            (B) accrued interest during construction.
    (2) The Administrator shall not be required to pay, during 
construction of the project, facility, or separable unit or feature, 
the interest calculated, accrued, and capitalized under paragraph (1).
    (3) For the purposes of this subsection, ``one-year rate'' for a 
fiscal year means a rate determined by the Secretary of the Treasury, 
taking into consideration prevailing market yields, during the month 
preceding the beginning of the fiscal year, on outstanding interest-
bearing obligations of the United States with periods to maturity of 
approximately one year.
    (g) Interest Rates for New Capital Investments.--The unpaid balance 
on the principal amount of a new capital investment bears interest at 
the Treasury rate for the new capital investment from the date the 
related project, facility, or separable unit or feature is placed in 
service until the earlier of the date the new capital investment is 
repaid or the repayment date for the new capital investment.
    (h) Credits to Administrator's Payments to the United States 
Treasury.--The Confederated Tribe of the Colville Reservation Grand 
Coulee Dam Settlement Act (Public Law 103-436) is amended by striking 
section 6 and inserting the following:

``SEC. 6. CREDITS TO ADMINISTRATOR'S PAYMENTS TO THE UNITED STATES 
                    TREASURY.

    ``(a) In General.--So long as the Adminisatrator makes annual 
payments to the tribes under the settlement agreement, the 
Administrator shall apply against amounts otherwise payable by the 
Administrator to the United States Treasury a credit that reduces the 
Administrator's payment in the amount and for each fiscal year as 
follows: $15,250,000 in fiscal year 1996; $15,860,000 in fiscal year 
1997; $16,490,000 in fiscal year 1998; $17,150,000 in fiscal year 1999; 
$17,840,000 in fiscal year 2000; and $4,100,000 in each succeeding 
fiscal year.
    ``(b) Definitions.--For the purposes of this section--
            ``(1) The term `settlement agreement' means that settlement 
        agreement between the United States of America and the 
        Confederated Tribes of the Colville Reservation signed by the 
        Tribes on April 16, 1994, and by the United States of America 
        on April 21, 1994, which settlement agreement resolves claims 
        of the Tribes in Docket 181-D of the Indian Claims Commission, 
        which docket has been transferred to the United States Court of 
        Federal Claims; and
            ``(2) The term `Tribes' means the Confederated Tribes of 
        the Colville Reservation, a Federally recognized Indian 
        Tribe.''.
    (i) Contract Provisions.--In each contract of the Administrator 
that provides for the Administrator to sell electric power, 
transmission, or related services, and that is in effect after 
September 30, 1995, the Administrator shall offer to include, or as the 
case may be, shall offer to amend to include, provisions specifying 
that after September 30, 1995--
            (1) the Administrator shall establish rates and charges on 
        the basis that--
                    (A) the principal amount of an old capital 
                investment shall be no greater than the new principal 
                amount established under subsection (b);
                    (B) the interest rate applicable to the unpaid 
                balance of the new principal amount of an old capital 
                investment shall be no greater than the interest rate 
                established under subsection (c);
                    (C) any payment of principal of an old capital 
                investment shall reduce the outstanding principal 
                balance of the old capital investment in the amount of 
                the payment at the time the payment is tendered; and
                    (D) any payment of interest on the unpaid balance 
                of the new principal amount of an old capital 
                investment shall be a credit against the appropriate 
                interest account in the amount of the payment at the 
                time the payment is tendered;
            (2) apart from charges necessary to repay the new principal 
        amount of an old capital investment as established under 
        subsection (b), and to pay the interest on the principal amount 
        under subsection (c), no amount may be charged for return to 
        the United States Treasury as repayment for or return on an old 
        capital investment, whether by way of rate, rent, lease 
        payment, assessment, user charge, or any other fee;
            (3) amounts provided under section 1304 of title 31, United 
        States Code, shall be available to pay, and shall be the sole 
        source for payment of, a judgment against or settlement by the 
        Administrator or the United States on a claim for a breach of 
        the contract provisions required by this Act; and
            (4) the contract provisions specified in this Act shall 
        not--
                    (A) preclude the Administrator from recovering, 
                through rates or other means, any tax that is generally 
                imposed on electric utilities in the United States, or
                    (B) affect the Administrator's authority under 
                applicable law, including section 7(g) of the Pacific 
                Northwest Electric Power Planning and Conservation Act 
                (16 U.S.C. 839e(g)), to--
                            (i) allocate costs and benefits, including 
                        but not limited to fish and wildlife costs, to 
                        rates or resources, or
                            (ii) design rates.
    (j) Savings Provisions.--(1) This section does not affect the 
obligation of the Administrator to repay the principal associated with 
each capital investment, and to pay interest on the principal, only 
from the ``Administrator's net proceeds,'' as defined in section 13 of 
the Federal Columbia River Transmission System Act (16 U.S.C. 838k(b)).
    (2) Except as provided in subsection (e) of this section, this 
section does not affect the authority of the Administrator to pay all 
or a portion of the principal amount associated with a capital 
investment before the repayment date for the principal amount.
    (k) DOE Study.--(1) The Administrator shall undertake a study to 
determine the effect that increases in the rates for electric power 
sales made by the Administrator may have on the customer base of the 
Bonneville Power Administration. Such study shall identify other 
sources of electric power that may be available to customers of the 
Bonneville Power Administration and shall estimate the level at which 
higher rates for power sales by the Administration may result in the 
loss of customers by the Administration.
    (2) The Administrator shall undertake a study to determine the 
total prior costs incurred by the Bonneville Power Administration for 
compliance with the provisions of the Endangered Species Act of 1973 
and the total future costs anticipated to be incurred by the 
Administration for compliance with such provisions.
    (3) The Administrator shall submit the results of the studies 
undertaken under this section to the Congress within 180 days after the 
date of the enactment of this Act.

                          PART 2--RECLAMATION

SEC. 9211. PREPAYMENT OF CERTAIN REPAYMENT CONTRACTS BETWEEN THE UNITED 
                    STATES AND THE CENTRAL UTAH WATER CONSERVANCY 
                    DISTRICT.

    The second sentence of section 210 of the Central Utah Project 
Completion Act (106 Stat. 4624) is amended to read as follows: ``The 
Secretary of the Interior shall allow for prepayment of the repayment 
contract between the United States and the Central Utah Water 
Conservancy District dated December 28, 1965, and supplemented on 
November 26, 1985, providing for repayment of the municipal and 
industrial water delivery facilities for which repayment is provided 
pursuant to such contract, under such terms and conditions as the 
Secretary deems appropriate to protect the interest of the United 
States, which shall be similar to the terms and conditions contained in 
the supplemental contract that provided for the prepayment of the 
Jordan Aqueduct dated October 28, 1993. The District shall exercise its 
right to prepayment pursuant to this section by the end of fiscal year 
2002.''.

SEC. 9212. TREATMENT OF CITY OF FOLSOM AS A CENTRAL VALLEY PROJECT 
                    CONTRACTOR.

    For the purposes of being considered eligible to be a transferee of 
Central Valley Project water to be used for municipal and industrial 
purposes, the city of Folsom, California, shall be treated as a Central 
Valley Project contractor as of November 1, 1990.

SEC. 9213. SLY PARK.

    (a) Short Title.--This section may be cited as the ``Sly Park Unit 
Conveyance Act''.
    (b) Definitions.--For purposes of this section:
            (1) The term ``El Dorado Irrigation District'' or 
        ``District'' means a political subdivision of the State of 
        California duly organized, existing, and acting pursuant to the 
        laws thereof with its principal place of business in the city 
        of Placerville, El Dorado County, California.
            (2) The term ``Secretary'' means the Secretary of the 
        Interior.
            (3) The term ``Sly Park Unit'' means the Sly Park Dam and 
        Reservoir, Camp Creek Diversion Dam and Tunnel and conduits and 
        canals as authorized under the American River Act of October 
        14, 1949 (63 Stat. 852), together with all other facilities 
        owned by the United States including those used to convey and 
        store water delivered from Sly Park, as well as all recreation 
        facilities associated thereto.
    (c) Sale of the Sly Park Unit.--
            (1) In general.--The Secretary shall, within one year after 
        the date of enactment of this Act, sell and convey to the El 
        Dorado Irrigation District the Sly Park Unit. Within such one-
        year period, the Secretary shall also transfer and assign the 
        water rights relating to the Sly Park Unit held in trust by the 
        Secretary for diversion and storage under California State 
        permits numbered 2631, 5645A, 10473, and 10474 to the El Dorado 
        Irrigation District.
            (2) Sale price.--The sale price shall not exceed--
                    (A) the construction costs ($30,926,230), as 
                included in the accounts of the Secretary, plus
                    (B) interest on the construction costs allocated to 
                domestic use, at the authorized rate included in 
                enactment of the Act of October 14, 1949 (63 Stat. 
                852), up to an agreed upon date, less
                    (C) all revenues to date as collected under the 
                terms of the contract between the United States and the 
                El Dorado Irrigation District, estimated at $9,146,885.
            (3) Terms of payment.--The Secretary shall provide for a 
        payment of the purchase price under paragraph (2) on terms not 
        to exceed 20 years. The interest rate to be paid by the 
        District shall be the authorized rate included in the Act of 
        October 14, 1949 (63 Stat. 852). Section 213(c) of the 
        Reclamation Reform Act of 1982 (43 U.S.C. 390mm(c)) shall not 
        apply to the purchase of the Sly Park Unit under this section.
            (4) Conveyance.--Upon signing the agreement to carry out 
        the sale required by this section, the Secretary shall convey 
        and assign to the El Dorado Irrigation District all right, 
        title, and interest of the United States in and to the Sly Park 
        Unit.
            (5) No additional environmental impact.--The Congress 
        specifically finds that (A) the sale, conveyance and assignment 
        of the Sly Park Unit and water rights under this section 
        involves the transfer of the ownership and operation of an 
        existing ongoing water project, (B) the Sly Park Unit 
        operation, facilities and water rights have been, and after the 
        sale and transfer will continue to be, committed to maximum 
        reasonable and beneficial use for existing services, and (C) 
        the sale, conveyance and assignment of the Sly Park Unit and 
        water rights does not involve any additional growth or 
        expansion of the project or other environmental impacts. 
        Consequently, the sale, conveyance and assignment of the Sly 
        Park Unit and water rights shall not be subject to 
        environmental review pursuant to the National Environmental 
        Policy Act of 1969 (42 U.S.C. 4332) or endangered species 
        review or consultation pursuant to section 7 of the Endangered 
        Species Act of 1973 (16 U.S.C. 1536).

SEC. 9214. HETCH HETCHY DAM.

    Section 7 of the Act of December 19, 1913 (38 Stat. 242), is 
amended--
            (1) by striking ``$30,000'' in the first sentence and 
        inserting ``$8,000,000'', and
            (2) by amending the second and third sentences to read as 
        follows: ``These funds shall be placed in a separate fund by 
        the United States and, notwithstanding any other provision of 
        law, shall not be available for obligation or expenditure until 
        appropriated by the Congress. The highest priority use of the 
        funds shall be for annual operation of Yosemite National Park, 
        with the remainder of any funds to be used to fund operations 
        of other national parks in the State of California.''.

         Subtitle C--National Parks, Forests, and Public Lands

                       PART 1--CONCESSION REFORM

SEC. 9301. SHORT TITLE.

    This part may be cited as the ``Visitor Facilities and Services 
Enhancement Act of 1995''.

SEC. 9302. PURPOSE.

    The purpose of this part is to ensure that quality visitor 
facilities and services are provided by the Federal land management 
agencies (Forest Service, United States Fish and Wildlife Service, 
National Park Service, Bureau of Land Management, Bureau of Reclamation 
and United States Army Corps of Engineers). Each Federal land 
management agency shall implement a program to encourage appropriate 
development and operation of services and facilities for the 
accommodation of visitors. The program implemented by each such agency 
shall consist of actions which--
            (1) recognize the importance of the private sector in 
        providing a quality visitor experience on Federal lands by 
        encouraging private sector investments for facilities and 
        services on Federal lands under a fair and competitive process;
            (2) establish the basis for an effective relationship 
        between the land management agencies and private businesses 
        operating on public lands and waters in efforts to serve the 
        public and to protect the resources of these areas;
            (3) measure quality and value of services provided by 
        concessioners and provide incentives for consistent excellence.
            (4) ensure a fair return to the Federal Government; and
            (5) are consistent among the various agencies to the extent 
        practicable in order to increase efficiency of the Federal 
        Government and simplify requirements for concessioners.

SEC. 9303. DEFINITIONS.

    For the purposes of this part:
            (1) The term ``adjusted gross receipts'' means gross 
        receipts less revenue derived from goods and services provided 
        on other than Federal lands or conveyed to units of Government 
        for hunting or fishing licenses or for entrance or recreation 
        fees, or from such other exclusions as the Secretary concerned 
        might apply.
            (2) The term ``agency head'' means the head of an agency or 
        his or her designated representative.
            (3) The term ``concessioner'' means a person or other 
        entity acting under a concession authorization which provides 
        public services, facilities, or activities on Federal lands or 
        waters pursuant to a concession services agreement or 
        concession license.
            (4) The term ``concession license'' means a written 
        contract between the agency head and the concessioner which 
        sets forth the terms and conditions under which the 
        concessioner is authorized to provide recreation services or 
        activities on a limited basis as well as the rights and 
        obligations of the Federal Government.
            (5) The term ``concession service agreement'' means a 
        written contract between the agency head and the concessioner 
        which sets forth the terms and conditions under which the 
        concessioner is authorized to provide visitor services, 
        facilities, or activities as well as the rights and obligations 
        of the Federal Government.
            (6) The term ``gross receipts'' means revenue from goods or 
        services provided by concession services, facilities, or 
        activities on Federal lands and waters.
            (7) The term ``performance incentive'' means a credit based 
        on past performance toward the score awarded by the Secretary 
        to a concessioner's proposal submitted in response to a 
        solicitation for the reissuance of such contract.
            (8) The term ``proposal'' means the complete submission for 
        a concession service agreement offered in response to the 
        solicitation for such concession service agreement.
            (9) The term ``prospectus'' means a document or documents 
        issued by the Secretary concerned and included with a 
        solicitation which sets forth the minimum requirements for the 
        award of a concession service agreement.
            (10) The term ``Secretary concerned'' means--
                    (A) the Secretary of the Interior with respect to 
                the United States Fish and Wildlife Service, National 
                Park Service, Bureau of Land Management, and Bureau of 
                Reclamation;
                    (B) the Secretary of Agriculture with respect to 
                the Forest Service; and
                    (C) the Secretary of the Army with respect to the 
                United States Army Corps of Engineers.
            (11) The term ``solicitation'' means a request by the 
        Secretary concerned for proposals in response to a prospectus.

SEC. 9304. NATURE AND TYPES OF CONCESSION AUTHORIZATIONS.

    (a) In General.--The Secretary concerned may enter into concession 
authorizations, as follows:
            (1) Concession services agreement.--A concession service 
        agreement shall be entered into for all concessions where the 
        Secretary concerned makes a finding that the provision of 
        concession services is in the interest of the Federal 
        Government and issues either a competitive offering for 
        concession services, facilities or activities or a 
        noncompetitive offering for such services, facilities, or 
        activities based on a finding that due to special circumstances 
        it is not in the public interest of the United States to award 
        a concession service agreement on a competitive basis. Where 
        the concessioner develops or uses fixed facilities on Federal 
        lands, the Secretary concerned shall issue a lease.
            (2) Concession license.--Whenever the Secretary concerned 
        makes a finding that public enjoyment of Federal lands would be 
        enhanced through the provision of concession services and that 
        there exists no need to limit the number of concessioners 
        providing such services, he shall consider entering into a 
        concession license with a qualified concessioner. Activities 
        covered under a concession license would typically be one-time, 
        intermittent, or infrequently scheduled. The Secretary 
        concerned may not limit the number of concession licenses 
        issued for the same types of activities in a particular 
        geographic area. The Secretary concerned shall monitor such 
        concession licenses to determine whether issuance of a 
        concession service agreement would be a more appropriate 
        authorization.
            (3) Lands under multiple jurisdictions.--The Secretaries of 
        the Departments concerned shall designate an agency to be the 
        lead agency concerning concessions which conduct a single 
        operation on lands or waters under the jurisdiction of more 
        than one agency. Unless otherwise agreed to by each such 
        Secretary concerned, the lead agency shall be that agency under 
        whose jurisdiction the concessioner generates the greatest 
        amount of gross receipts. The agency so designated shall issue 
        a single authorization and collect a single fee under 
        paragraphs (1) and (2) for such operation. Such authorization 
        shall provide for use in a manner consistent with the plans and 
        policies for each agency.
    (b) Leases of Areas to States and State Third Party Agreement Not 
Covered.--This part does not apply to leases or licenses of entire 
areas to States or other political subdivisions or to any third party 
agreement issued by any such State or political subdivisions with 
respect to such entire area.

SEC. 9305. COMPETITIVE SELECTION PROCESS FOR CONCESSION SERVICE 
                    AGREEMENTS.

    (a) Award to Best Proposal.--The Secretary shall enter into, and 
reissue, a concession service agreement with the person whom the 
Secretary determines in accordance with this section submits the best 
proposal through a competitive process as defined in this section.
    (b) Solicitation and Prospectus.--The Secretary concerned shall 
prepare a solicitation and prospectus which describes the concession 
service opportunity and shall publish, in appropriate locations, 
announcements of the availability of the solicitation, prospectus, and 
the concession service opportunity. The solicitation shall include (but 
need not be limited to) the following:
            (1) A description of the services and facilities to be 
        provided by the concessioner.
            (2) The level of capital investment required by the 
        concessioner (if any).
            (3) Terms and conditions of the concession service 
        agreement.
            (4) Minimum facilities and services to be provided by the 
        Secretary to the concessioner and the public.
            (5) Minimum fees to the United States.
    (c) Factors and Minimum Standards in Determining Best Proposal.--
The prospectus shall assign a weight to each factor indentified therein 
related to the importance of such factor in the selection process. 
Points shall be awarded for each such factor, based on the relative 
strength of the proposal concerning that factor. In determining the 
best proposal, the Secretary concerned shall take into consideration 
(but shall not be limited to) the following, including whether the 
proposal meets the minimum requirements (if any) of the Secretary for 
each of the following:
            (1) Responsiveness to the prospectus.
            (2) Quality of visitor services taking into account the 
        nature of equipment and facilities to be provided.
            (3) Experience and performance in providing similar 
        services. This factor shall account for not less than 20 
        percent of the maximum points available under any prospectus. 
        Where the Secretary concerned determines it to be warranted to 
        provide for a high quality visitor experience, the prospectus 
        for a concession service agreement shall provide greater weight 
        to this factor based on such aspects of the concession service 
        agreement as scope or size, complexity, nature of technical 
        skills required, and site-specific knowledge of the area. The 
        similarity of the qualifying experience outlined in the 
        proposal to the nature of the services required under the 
        concession service agreement and the length of such qualifying 
        experience shall be the basis for awarding points for this 
        factor.
            (4) Record of resource protection (as appropriate for 
        services and activities with potential to impact natural or 
        cultural resources).
            (5) Financial capability.
            (6) Fees to the United States.
    (d) Selection Process.--The process for selecting the best proposal 
shall consist of the following:
            (1) First, the Secretary concerned shall identify those 
        proposals which meet the minimum standards (if any) for the 
        factors identified under subsection (c).
            (2) Second, the Secretary concerned shall evaluate all 
        proposals identified under paragraph (1), considering all 
        factors identified under subsection (c), as well as performance 
        incentives earned under section 9306(c) and renewal penalties 
        incurred under section 9306(d).
            (3) Third, the Secretary concerned shall offer the 
        concession service agreement to the best qualified applicant as 
        determined by the evaluation under paragraph (2).
    (e) Inapplicability of NEPA to Temporary Extensions and Similar 
Reissuance of Concessions Agreements.--The temporary extension of a 
concession authorization, or reissuance of a concession authorization 
to provide concession services similar in nature and amount to 
concession services provided under the previous authorization, is 
hereby determined to be a categorical exclusion as provided for under 
the National Environmental Policy Act of 1969 (42 U.S.C. 4331 et seq.).
    (f) Provision for Additional Related Services.--The Secretary 
concerned may modify the concession service agreement to allow 
concessioners to provide services closely related to such agreement, if 
the Secretary concerned determines that such changes would enhance the 
safety or enjoyment of visitors and would not unduly restrict the award 
of future concession service agreements.

SEC. 9306. CONCESSIONER EVALUATIONS.

    (a) In General.--The Secretary concerned shall develop a program of 
evaluations of the concessioners operating under a concession service 
agreement who are providing visitor services in areas under the 
jurisdiction of the Secretary. The evaluations shall be on an annual 
basis over the duration of the concession service agreement. In 
developing the evaluation program, the Secretary concerned shall seek 
broad public input from concessioners, State agencies, and other 
interested persons. The evaluation program shall--
            (1) include the four program areas of: quality of visitor 
        services provided; resource protection (as applicable); 
        financial performance; and compliance with concession service 
        agreement provisions and pertinent laws and regulations;
            (2) define three levels of performance--
                    (A) good, which shall be defined as a level of 
                performance which exceeds the requirements outlined in 
                the prospectus, but which is attainable;
                    (B) satisfactory, which shall be defined as meeting 
                the requirements as contained in the prospectus; and
                    (C) unsatisfactory, which shall be defined as not 
                meeting the requirements contained in the prospectus;
            (3) be based on criteria which--
                    (A) are objective, measurable, and attainable; and
                    (B) shall include as applicable general standards 
                for all concession operations, industry-specific 
                standards, and standards developed by the Secretary 
                concerned in consultation with the concessioner for 
                each concession service agreement;
            (4) be designed in such a manner that the annual evaluation 
        represents the overall performance of the concessioner without 
        undue weight to matters of limited importance; and
            (5) take into account factors beyond the control of the 
        concessioner, such as general market and other economic 
        fluctuations, as well as weather and other natural phenomena, 
        so that such factors may not be used as a justification for 
        denial of performance incentives.
    (b) Annual Evaluations.--
            (1) Requirements.--The Secretary concerned shall at least 
        semiannually review the performance of each concessioner and 
        shall assign an overall rating for each concessioner for each 
        year. The procedure for any performance evaluation shall be 
        provided to the concessioner prior to the beginning of any 
        evaluation period. Such procedure shall provide for adequate 
        notification of the concessioner prior to any on-site 
        evaluation and permit a representative of the concessioner to 
        observe the evaluation. The concessioner shall be entitled to a 
        complete explanation of any rating given. If the Secretary's 
        performance evaluation for any year results in an 
        unsatisfactory rating of the concessioner, the Secretary 
        concerned shall so notify the concessioner, in writing. Such 
        notification shall identify the nature of conditions which 
        require corrective action and shall provide the concessioner 
        with a list of corrective actions necessary to meet the 
        standards.
            (2) Suspension, revocation, and termination of 
        authorization.--The Secretary concerned may suspend, revoke, or 
        terminate a concession authorization if the concessioner fails 
        to correct the conditions identified by the Secretary within 
        the limitations established by the Secretary at the time notice 
        of the unsatisfactory rating is provided to the concessioner. 
        The Secretary may immediately suspend or revoke a concession 
        authorization where necessary to protect the public health or 
        welfare.
    (c) Performance incentives.--
            (1) In evaluating the performance of a concessioner, the 
        incumbent concessioner is entitled to a performance incentive 
        of--
                    (A) one percent of the maximum points available 
                under such evaluations for performance in each year in 
                which the concessioner's annual performance is rated 
                good, as specified in subsection (a)(2)(A), and
                    (B) a one-time three year merit term extension upon 
                a finding that a concessioner has been rated as good in 
                each annual performance evaluation through the term of 
                the concession service agreement.
            (2) A performance incentive awarded under paragraph (1)(A) 
        may not exceed 10 percent of the maximum points available under 
        such evaluations over the life of the concession service 
        agreement.
    (d) Renewal penalty.--In evaluating the performance of a 
concessioner, a concessioner shall be penalized one percent of the 
maximum points available under such evaluation for performance in each 
year in which the concessioner's annual performance is found to be 
unsatisfactory.

SEC. 9307. CAPITAL IMPROVEMENTS.

    (a) Private Sector Development.--It is the policy of the United 
States to encourage the private sector to develop, own, and maintain to 
the extent possible such public recreation facilities which would 
enhance public use and enjoyment of Federal lands as are contained in 
approved plans developed by the Secretary concerned. Under the terms of 
this part, concessioners may only construct or finance construction 
under terms of section 9312 such public facilities on Federal lands as 
are to be used by the concessioner under the terms of their concession 
service agreement or facilities which are necessary for the 
concessioner to administer such public facilities on Federal lands.
    (b) Investment Interest.--
            (1) In general.--A concessioner, who is required or 
        authorized under a concession service agreement pursuant to 
        this part to acquire or construct any structure, improvement, 
        or fixture pursuant to such agreement on Federal lands shall 
        have an investment interest therein, to the extent provided by 
        the agreement and this part. Such investment interest shall not 
        be extinguished by the expiration of such agreement. Such 
        investment interest may be assigned, transferred, encumbered or 
        relinquished.
            (2) Limitation.--Such investment interest shall not be 
        construed to include or imply any authority, privilege, or 
        right to operate or engage in any business or other activity, 
        and the use of any improvement in which the concessioner has an 
        investment interest shall be wholly subject to the applicable 
        provisions of the concession service agreement and of laws and 
        regulations relating to the area.
            (3) Federal property.--The agreement shall specify which 
        new improvements required under terms of the concession service 
        agreement, if any, shall become the property of the Federal 
        Government at the end of the agreement. No concession service 
        agreement shall provide for a concessioner to obtain an 
        investment interest in any building which is wholly owned by 
        the Federal Government. Title to the land on which such 
        structure, improvement, or fixture is placed shall remain in 
        the United States.
    (c) Sale of Assets.--If the existing concessioner is not selected 
as the best qualified applicant at the time of reissuance of a 
concession service agreement, the Secretary concerned shall require the 
new concessioner to buy the investment interest of the existing 
concessioner.
    (d) Closure of Concessioner Facilities.--In the event of a decision 
by the Secretary concerned, that the public interest, by reason of 
public and safety considerations or for other reasons beyond the 
control of the concessioner, requires the discontinuation or closure of 
facilities in which the concessioner has an investment interest, the 
Secretary shall compensate the concessioner in the amount equal to the 
value of the investment interest.
    (e) Determination of Value of Investment Interest.--For purposes of 
this part, the investment interest of any capital improvement at the 
end of the concession service agreement period is the actual cost of 
construction of such capital improvement adjusted from the completion 
of such construction by changes in the Consumer Price Index (selected 
in the same manner as such Index is selected under section 9311(c)(2)) 
less depreciation evidenced by the condition and prospective 
serviceability in comparison with a new unit of like kind, but not to 
exceed fair market value. Such value shall be determined by appraisal 
and included in any prospectus.

SEC. 9308. DURATION OF CONCESSION AUTHORIZATION.

    (a) Concession Service Agreement.--The standard term of a 
concession service agreement shall be ten years. The Secretary 
concerned may issue a concession service agreement for less than ten 
years if he determines (in his discretion) that the average annual 
gross receipts over the life of the concession service agreement would 
be less than $100,000. The Secretary concerned may not issue a 
concession service agreement for less than five years. The Secretary 
concerned shall issue a concession service agreement for longer than 
ten years if the Secretary determines (in his discretion) that such 
longer term is in the public interest or necessary due to the extent of 
investment and associated financing requirements and to meet the 
obligations assumed. The term for a concession service agreement may 
not exceed 30 years.
    (b) Concession License.--The term for a concession license may not 
exceed two years.
    (c) Temporary Extension.--The Secretary may agree to temporary 
extensions of concession service agreements for up to two years on a 
noncompetitive basis to avoid interruption of services to the public.

SEC. 9309. RATES AND CHARGES TO THE PUBLIC.

    In general, rates and charges to the public shall be set by the 
concessioner. For concession service agreements only, a concessioner's 
rates and charges to the public shall be subject to the approval of the 
Secretary concerned in those instances where the Secretary determines 
that sufficient competition for such facilities and services does not 
exist within or in close proximity to the area in which the 
concessioner operates. In those instances, the concession service 
agreement shall state that the reasonableness of the concessioner's 
rates and charges to the public shall be reviewed and approved by the 
Secretary concerned primarily by comparison with those rates and 
charges for facilities and services of comparable character under 
similar conditions, with due consideration for length of season, 
seasonal variations, average percentage of occupancy, accessibility, 
availability and costs of labor and materials, type of patronage, and 
other factors deemed significant by the Secretary concerned. Such 
review shall be completed within 90 days of receipt of all necessary 
information, or the requirement for the Secretary's approval shall be 
waived and such rates and charges as proposed by the concessioner 
considered to be approved for immediate use.

SEC. 9310. TRANSFERABILITY OF CONCESSION AUTHORIZATIONS.

    (a) Concession Service Agreements.--
            (1) Approval required.--A concession service agreement is 
        transferable or assignable only upon the approval of the 
        Secretary concerned, which approval may not be unreasonably 
        withheld or delayed. The Secretary may not approve any such 
        transfer or assignment if the Secretary determines that the 
        prospective concessioner is or is likely to be unable to 
        completely satisfy all of the material requirements, terms, and 
        conditions of the agreement or that the terms of the transfer 
        or assignment would preclude providing appropriate facilities 
        or services to the public at reasonable rates.
            (2) Consideration period.--If the Secretary fails to 
        approve or disapprove a transfer or assignment under paragraph 
        (1) within 90 days after the date on which the Secretary 
        receives all necessary information requested by the Secretary 
        with respect to such transfer, the transfer or assignment shall 
        be deemed approved.
            (3) No modification of terms and conditions.--The terms and 
        conditions of the concessions service agreement shall not be 
        subject to modification by reason of any transfer or assignment 
        under this section.
            (4) Performance incentive.--Upon approval of the sale or 
        transfer, the prospective concessioner shall be entitled to the 
        benefit of performance incentives earned by the previous 
        concessioner.
    (b) Concession License.--A concession license may not be 
transferred.

SEC. 9311. FEES CHARGED BY THE UNITED STATES FOR CONCESSION 
                    AUTHORIZATIONS.

    (a) In General.--The Secretary concerned shall charge a fee for the 
privilege of providing concession services pursuant to this part. The 
fee for any concession service agreement may include any of the 
following:
            (1) An annual cash payment for the privilege of providing 
        concession services.
            (2) The amount required for capital improvements required 
        pursuant to section 9307(a).
            (3) Fees for rental or lease of Government-owned facilities 
        or lands occupied by the concessioner.
            (4) Expenditures for maintenance of or improvements to 
        Government-owned facilities occupied by the concessioner.
    (b) Establishment of Amount.--
            (1) Minimum acceptable fee.--The Secretary concerned shall 
        establish a minimum fee for each applicable category specified 
        in paragraphs (1) through (4) of subsection (a) which is 
        acceptable to the Secretary under this section and shall 
        include the minimum fee in the prospectus under section 9305. 
        This fee shall be based on historical data, where available, as 
        well as industry-specific and other market data available to 
        the Secretary concerned.
            (2) Final fee.--Except as provided by paragraph (3), the 
        final fee shall be the amount bid by the selected applicant 
        under section 9305.
            (3) Substantially similar services in a specific geographic 
        area.--Where the Secretary concerned simultaneously offers 
        authorizations for more than one river runner, outfitter, or 
        guide concession operation to provide substantially similar 
        services in a defined geographic area, the concession fee for 
        all such concessioners shall be specified by the Secretary 
        concerned in the prospectus. The Secretary concerned shall base 
        the fee on historical data, where available, as well as on 
        industry-specific and other market data available to the 
        Secretary concerned or may establish a charge per user day.
    (c) Adjustment of Fees.--
            (1) In general.--The amount of any fee for the term of the 
        concession service agreement shall be set at the beginning of 
        the concession authorization and may only be modified on the 
        basis of inflation, if the annual payment is not determined by 
        a percentage of adjusted gross receipts (as measured by changes 
        in the Consumer Price Index), to reflect substantial changes 
        from the conditions specified in the prospectus, or in the 
        event of an unforeseen disaster.
            (2) CPI.--For the purposes of adjustments for inflation 
        under paragraph (1), the Federal agencies shall select a 
        Consumer Price Index published by the Bureau of Labor 
        Statistics and shall use such index in a consistent manner.
    (d) Concession License Fee.--The fee for a concession license shall 
at least cover the program administrative costs and may not be changed 
over the term of the license.

SEC. 9312. DISPOSITION OF FEES.

    (a) Concession Improvement Account.--
            (1) In general.--The Secretary concerned shall, whenever 
        the concession service agreement requires or authorizes the 
        concessioner to make capital improvements or occupy Government-
        owned facilities, require the concessioner to establish a 
        concession improvement account. The concessioner shall deposit 
        into this account--
                    (A) all funds for capital improvements as specified 
                in the concession service agreement;
                    (B) all funds for maintenance of or improvements to 
                Government-owned facilities occupied by the 
                concessioner; and
                    (C) all amounts received from the Secretary 
                concerned pursuant to subsection (b).
            (2) Terms and conditions.--The account shall be maintained 
        by the concessioner in an interest bearing account in a 
        Federally insured financial institution. The concessioner shall 
        maintain the account separately from any other funds or 
        accounts and shall not commingle the monies in the account with 
        any other moneys. The Secretary concerned may establish such 
        other terms, conditions, or requirements as the Secretary 
        determines to be necessary to ensure the financial integrity of 
        the account.
            (3) Disbursements.--The concessioner shall make 
        disbursements from the account for improvements and other 
        activities, only as specified in the concession service 
        agreement and subsection (b)(2)(C).
            (4) Records.--The concessioner shall maintain proper 
        records for all disbursements made from the account. Such 
        records shall include (but not be limited to) invoices, bank 
        statements, canceled checks, and such other information as the 
        Secretary concerned determines to be necessary.
            (5) Annual financial statement.--The concessioner shall 
        annually submit to the Secretary concerned a statement 
        reflecting total activity in the account for the preceding 
        financial year. The statement shall reflect monthly deposits, 
        expenditures by project, interest earned, and such other 
        information as the Secretary concerned requires.
            (6) Transfer of remaining balance.--Upon the termination of 
        a concession authorization, or upon the transfer of a 
        concession service agreement, any remaining balance in the 
        account shall be transferred by the concessioner to the 
        successor concessioner, to be used solely as set forth in this 
        subsection. In the event there is no successor concessioner, 
        the account balance shall be deposited in the Treasury as 
        miscellaneous receipts.
    (b) Amounts Received Relating to Privilege of Providing Concession 
Services and Rental of Government-owned Facilities.--
            (1) Deposit into treasury.--The Secretary concerned shall 
        deposit into the Treasury of the United States as miscellaneous 
        receipts amounts received for a fiscal year for the privilege 
        of providing concession services and the rental of Government-
        owned facilities up to the amount specified in the table in 
        paragraph (3) for the National Park Service for that fiscal 
        year. For the other agencies covered under this part, the 
        Secretary concerned shall develop a schedule of anticipated 
        receipts to be deposited to the Treasury and submit such 
        schedule to the appropriate Congressional committees within 18 
        months of the date of enactment of this Act. Nothing in this 
        part shall be construed to modify any provision of law relating 
        to sharing of Federal receipts with any other level of 
        Government.
            (2) Deposit into concession improvement accounts.--(A) 
        Amounts received by the Secretary concerned for a fiscal year 
        for the privilege of providing concession services and the use 
        of Government-owned facilities which exceed the amount 
        specified in the table in paragraph (3) for that fiscal year 
        shall be available for deposit in the succeeding fiscal year 
        into concession improvement accounts.
            (B) Of the amounts available for deposit into concession 
        improvement accounts, the Secretary shall make available to 
        each concessioner a percentage of such excess amounts which 
        bears the same ratio as the amount paid by the concessioner to 
        the Secretary concerned for a fiscal year for the privilege of 
        providing concession services and the use of Government-owned 
        facilities bears to the total amount paid to the Secretary 
        concerned by all concessioners for that fiscal year for such 
        privilege on an agency-wide basis.
            (C) Amounts made available to a concessioner under this 
        paragraph may be used only for expenditures on visitor services 
        and facilities at the area at which the funds were generated.
            (3) Deposit into concession improvement accounts.--The 
        table referred to in paragraph (2), expressed by fiscal year on 
        an agency basis, is as follows:

                         National Park Service

                Fiscal year:
                                                               Amount: 
                        1997.........................      $15,800,000 
                        1998.........................      $21,100,000 
                        1999.........................      $26,700,000 
                        2000.........................      $32,300,000 
                        2001.........................      $38,200,000 
                        2002.........................      $44,400,000.

    (c) Audit Requirement.--Beginning with fiscal year 1998, the 
Inspector General of the Department concerned shall conduct a biennial 
audit of concession fees generated pursuant to this part. The Inspector 
General shall make a determination as to whether concession fees are 
being collected and expended in accordance with this part and shall 
submit copies of each audit to the Committee on Resources of the House 
of Representatives and the Committee on Energy and Natural Resources of 
the Senate.

SEC. 9313. DISPUTE RESOLUTION.

    (a) Board of Contract Appeals.--The Board of Contract Appeals 
within each Department shall adjudicate disputes between the Federal 
Government and concessioners arising under this part, including 
disputes regarding the revocation, suspension, or termination of a 
concession authorization, transfers of concession service agreements, 
and performance evaluations of concessions. Such disputes shall be 
subject to the Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.). 
The expiration of a concession authorization shall not be subject to 
appeal to the Board.
    (b) Administrative Review.--Appeals of decisions may be taken to 
the Board of Contract Appeals after one level of review of decisions 
made within an agency.
    (c) Expedited Procedure.--Appeals of decisions to suspend, revoke, 
or terminate a concession authorization shall be considered under an 
expedited procedure, as provided by the Secretary concerned by 
regulation.
    (d) Judicial Review.--
            (1) In general.--A person may seek judicial review of 
        decisions made by the Board. Such review shall be conducted by 
        the court with jurisdiction on a de novo basis.
            (2) Concession service agreements.--Judicial review of 
        decisions rendered by the Board regarding concession service 
        agreements shall be to the United States Court of Federal 
        Claims in accordance with section 1491 of title 28, United 
        States Code (commonly referred to as the ``Tucker Act'').
            (3) Concession licenses.--Judicial review of decisions 
        rendered by the Board regarding concession licenses shall be to 
        the appropriate Federal District Court.
    (d) Inapplicability of Certain Provisions.--Disputes arising under 
this part shall not be subject to the jurisdiction of the General 
Accounting Office to review bid protests under the Competition in 
Contracting Act of 1984.

SEC. 9314. RECORDKEEPING.

    (a) Maintenance and Access.--Each concessioner shall keep such 
records as the Secretary concerned may prescribe to enable the 
Secretary to determine that all terms of the concession authorization 
have been and are being faithfully performed, and the Secretary and his 
duly authorized representatives shall, for the purpose of audit and 
examination, have access at reasonable times and locations to such 
records and to other books, documents, and papers of the concessioner 
pertinent to the concession authorization and all the terms and 
conditions thereof.
    (b) Access by Comptroller General.--The Comptroller General of the 
United States or any of his duly authorized representatives shall, 
until the expiration of five calendar years after the close of the 
business year of each concessioner have access to and the right to 
examine any pertinent books, documents, papers, and records of the 
concessioner related to the concession authorization involved.

SEC. 9315. APPLICATION OF GENERAL GOVERNMENTAL ACQUISITION 
                    REQUIREMENTS.

    The following laws and regulations shall not apply to concession 
service agreements and concession licenses under this part:
            (1) Title III of the Federal Property and Administrative 
        Services Act of 1949 (41 U.S.C. 251-266).
            (2) The Office of Federal Procurement Policy Act (41 U.S.C. 
        401 et seq.).
            (3) The Federal Acquisition Streamlining Act of 1994 
        (Public Law 103-355).
            (4) The Brooks Automatic Data Processing Act (40 U.S.C. 
        759).
            (5) Chapters 137 and 141 of title 10, United States Code.
            (6) The Federal Acquisition Regulation and any laws not 
        listed in paragraphs (1) through (5) providing authority to 
        promulgate regulations in the Federal Acquisition Regulation.
            (7) The Act of June 20, 1936 (20 U.S.C. 107; commonly 
        referred to as the ``Randolph-Sheppard Act'') and the Service 
        Contract Act of 1965 (41 U.S.C. 351 et seq.).

SEC. 9316. RULES OF CONSTRUCTION.

    Concession programs of an agency on Federal lands and waters 
subject to this part shall be fully consistent with the agency's 
mission and laws applicable to the agency. Nothing in this part shall 
be construed as limiting or restricting any right, title, or interest 
of the United States in any land or resources.

SEC. 9317. REGULATIONS.

    (a) In General.--Pursuant to enactment of this part, no new 
concession authorization may be issued, nor may any existing concession 
authorization remain in effect after two years after the date of the 
enactment of this Act, unless regulations fully implementing this part 
are in effect. During such two-year period, the Secretary may only 
extend an existing concession authorization for a period ending at the 
end of such two-year period. Such extensions shall be made in 
accordance with the applicable provisions of law specified in section 
9318, as such provisions were in effect on the day before the date of 
the enactment of this Act. The Secretary of the Interior, Secretary of 
Agriculture, and Secretary of the Army shall develop a single set of 
regulations which specify a uniform set of recordkeeping requirements 
for all concessioners with respect to implementation of this part.
    (b) Qualifications of Agency Personnel Assigned Concession 
Management Duties.--The Secretary, by regulation under subsection (a) 
and taking into account the provisions of this part, shall specify the 
minimum training and qualifications required for agency personnel 
assigned predominantly to concession management duties, including (but 
not limited to) competency in business management, public health and 
safety, and the delivery of quality customer services.

SEC. 9318. RELATIONSHIP TO OTHER EXISTING LAWS.

    (a) Repeals.--
            (1) The Act entitled ``An Act relating to the establishment 
        of concession policies in the areas administered by the 
        National Park Service and for other purposes'' (16 U.S.C. 20-
        20g) approved October 9, 1965, is repealed.
            (2) The last paragraph under the heading ``forest service'' 
        in the Act of March 4, 1915 (38 Stat. 1101), as amended by the 
        Act of July 28, 1956 (chap. 771; 70 Stat. 708) (16 U.S.C. 497), 
        is repealed.
            (3) Section 7 of the Act of April 24, 1950 (16 U.S.C. 580d) 
        is repealed.
    (b) Superseded Provisions.--The provisions of this part shall 
supersede the provisions of the following Acts as they pertain to 
concessions management:
            (1) The Federal Land Policy and Management Act of 1976 
        (Oct. 21, 1976).
            (2) Public Law 87-714 (16 U.S.C. 460k et seq.; commonly 
        known as the ``Refuge Recreation Act'').
            (3) The National Wildlife Refuge System Administration Act 
        of 1966 (16 U.S.C. 668dd).
    (c) Conforming Amendment.--The fourth sentence of section 3 of the 
Act of August 25, 1916 (16 U.S.C. 3; 39 Stat. 535), is amended by 
striking all through ``no natural'' and inserting in lieu thereof ``No 
natural''.
    (d) Modified Provisions.--The second sentence of section 4 of the 
Act entitled ``An Act authorizing the construction of certain public 
works on rivers and harbors for flood control, and for other purposes'' 
(16 U.S.C. 460d) is amended by inserting ``, except for commercial 
concessions purposes'' the first place it appears after ``public 
interest''.
    (e) Savings.--
            (1) In general.--The repeal of any provision, the 
        superseding of any provision, and the amendment of any 
        provision, of an Act referred to in subsections (a), (b), or 
        (c) shall not affect the validity of any authorizations entered 
        into under any such Act. The provisions of this part shall 
        apply to any such authorizations, except to the extent such 
        provisions are inconsistent with the express terms and 
        conditions of such authorizations.
            (2) Right of renewal.--The right of renewal explicitly 
        provided for by any concession contract under any such 
        provision shall be preserved for a single renewal of a contract 
        following the enactment of, or concession authorization under, 
        this part.
            (3) Value of capital improvements or possessory interest.--
        Nothing in this part shall be construed to change the value of 
        existing capital improvements or possessory interest as 
        identified in concession contracts entered into before the 
        enactment of this Act.
            (4) ANILCA.--Nothing in this part shall be construed to 
        amend, supersede or otherwise affect any provision of the 
        Alaska National Interest Lands Conservation Act (16 U.S.C. 3101 
        et seq.) relating to revenue-producing visitor services.
            (5) Ski area permits.--No provision of this part shall 
        apply to any ski area permittee operating on lands administered 
        by the Forest Service.
            (6) Procedures for considering existing concessioners in 
        reissuance of contracts.--In the case of any concession 
        contract which has expired prior to the date of the enactment 
        of this Act, or within five years after the date of the 
        enactment of this Act, the incumbent concessioner shall be 
        entitled to a one-time bonus of five percent of the maximum 
        points available in the reissuance of a previous concession 
        authorization. For any concession contract entered into prior 
        to the date of enactment of this Act, which is projected to 
        terminate five years or later after the enactment of this Act, 
        any concessioner shall be entitled to a performance incentive 
        as outlined in this part. The concessioner shall be entitled to 
        an evaluation for the purposes of section 9306 of good for each 
        year in which the Secretary concerned does not complete an 
        evaluation as provided for in this part.

                   PART 2--NATIONAL FOREST SKI AREAS

SEC. 9321. PRIVATIZATION OF FOREST SERVICE SKI AREAS.

    (a) Authorization To Sell.--
            (1) In general.--Not later than five years after the date 
        of enactment of this part, the Secretary of Agriculture shall 
        offer to sell not less than 40 ski areas to the qualifying ski 
        area operator. Any such sale shall provide for continuation of 
        public access for diverse recreational uses. The Secretary 
        shall offer such areas for sale only after consultation with 
        State and local governments. Any such sale shall be at fair 
        market value and, subject to valid existing rights, shall 
        transfer all right, title, and interest of the United States in 
        and to the lands. In any such sale, the Secretary shall 
        establish the minimum acceptable bid based on the appraised 
        fair market value of such lands.
            (2) Qualifying lands.--For the purposes of subsection (a), 
        lands are qualifying concession lands if such lands are--
                    (A) subject to a lease on the date of the enactment 
                of this Act for use as a ski area with improvements 
                with a fair market value greater than $2,000,000; and
                    (B) located either adjacent to the boundary of the 
                Federal lands or adjacent to other significant private 
                inholdings.
    (b) Appraisal.--
            (1) In general.--The Secretary shall provide for an 
        independent appraisal of the lands and interests therein to be 
        transferred pursuant to subsection (a). The appraiser shall--
                    (A) utilize nationally recognized appraisal 
                standards, including to the extent appropriate the 
                uniform appraisal standards for Federal land 
                acquisition; and
                    (B) not include the value of any improvement placed 
                on the lands by the concessioner.
            (2) Appraisal report.--The appraiser shall submit a 
        detailed report to the Secretary.
    (c) Additional Lands.--In addition to the national forest ski area, 
the Secretary may transfer by sale or exchange additional National 
Forest System lands for the purpose of adding such lands to and 
operating them as part of a ski area sold under subsection (a). The 
transfer of additional lands under this subsection shall be in 
accordance with this part and the laws generally applicable to the 
National Forest System.
    (d) Use of Proceeds by the Appropriate Secretary.--The Secretary 
may retain 50 percent of the funds generated through sales under this 
section to acquire other high priority lands identified for acquisition 
in any forest land and resource management plan. The remaining 50 
percent of such amount shall be deposited in the Treasury as 
miscellaneous receipts.

SEC. 9322. SKI AREA PERMIT FEES AND WITHDRAWAL OF SKI AREAS FROM 
                    OPERATION OF MINING LAWS.

    The National Forest Ski Area Permit Act of 1986 (16 U.S.C. 497b) is 
amended by adding at the end the following new sections:

``SEC. 4. SKI AREA PERMIT FEES.

    ``(a) Ski Area Permit Fee.--
            ``(1) In general.--Except as provided by paragraph (2), 
        after the date of the enactment of this section, the fee for 
        all ski area permits on National Forest System lands shall be 
        calculated, charged, and paid only as set forth in subsection 
        (b).
            ``(2) Exception.--Paragraph (1) does not apply to any ski 
        area where the existing permit in effect on the date of 
        enactment of this section specifies a different method to 
        calculate the fee. In any such situation the terms of such 
        permit shall prevail, unless the permit holder notifies the 
        Forest Service that the permit holder agrees to adopt the 
        method of fee calculation specified in this section. The Forest 
        Service should encourage such permit holders to consider 
        adopting the new method of fee calculation in order to reduce 
        its administrative costs.
    ``(b) Method of Calculation.--
            ``(1) Determination of adjusted gross revenue subject to 
        fee.--The Secretary of Agriculture shall calculate the ski area 
        permit fee to be charged a ski area permittee by first 
        determining the permittee's adjusted gross revenue to be 
        subject to the permit fee. The permittee's adjusted gross 
        revenue is equal to the sum of the following:
                    ``(A) The permittee's gross revenues from alpine 
                lift ticket and alpine season pass sales plus revenue 
                from alpine ski school operations, with such total 
                multiplied by the permittee's slope transport feet 
                percentage on National Forest System lands.
                    ``(B) The permittee's gross revenues from nordic 
                ski use pass sales and nordic ski school operations, 
                with such total multiplied by the permittee's 
                percentage of nordic trails on National Forest System 
                lands.
                    ``(C) The permittee's gross revenues from ancillary 
                facilities physically located on National Forest System 
                lands, including all permittee or subpermittee lodging, 
                food service, rental shops, parking, and other 
                ancillary operations.
            ``(2) Determination of ski area permit fee.--The Secretary 
        shall determine the ski area permit fee to be charged a ski 
        area permittee by multiplying adjusted gross revenue determined 
        under paragraph (1) for the permittee by the following 
        percentages for each revenue bracket and adding the total for 
        each revenue bracket:
                    ``(A) 1.5 percent of all adjusted gross revenue 
                below $3,000,000.
                    ``(B) 2.5 percent for adjusted gross revenue 
                between $3,000,000 and $15,000,000.
                    ``(C) 2.75 percent for adjusted gross revenue 
                between $15,000,000 and $50,000,000.
                    ``(D) 4.0 percent for the amount of adjusted gross 
                revenue that exceeds $50,000,000.
            ``(3) Slope transport feet percentage.--In cases where ski 
        areas are only partially located on National Forest System 
        lands, the slope transport feet percentage on national forest 
        land referred to in paragraph (1) shall be calculated as 
        generally described in the Forest Service Manual in effect as 
        of January 1, 1992.
            ``(4) Annual adjustment of adjusted gross revenue.--In 
        order to insure that the ski area permit fee set forth in this 
        subsection remains fair and equitable to both the United States 
        and ski area permittees, the Secretary shall adjust, on an 
        annual basis, the adjusted gross revenue figures for each 
        revenue bracket in subparagraphs (A) through (D) of paragraph 
        (2) by the percent increase or decrease in the national 
        Consumer Price Index for the preceding calendar year.
    ``(c) Minimum Fee.--In cases where an area of National Forest 
System land is under a ski area permit but the permittee does not have 
revenue or sales qualifying for fee payment pursuant to subsection (a), 
the permittee shall pay an annual minimum fee of $2 for each acre of 
National Forest System land under permit. Rental fees imposed under 
this subsection shall be paid at the time specified in subsection (d).
    ``(d) Time for Payment.--The fee set forth in subsection (b) shall 
be due on June 1 of each year and shall be paid or prepaid by the 
permittee on a monthly, quarterly, annual, or other schedule as 
determined appropriate by the Secretary in consultation with the 
permittee. It is the intention of Congress that unless mutually agreed 
otherwise by the Secretary and the permittee, the payment or prepayment 
schedule shall conform to the permittee's schedule in effect prior to 
the enactment of this section. To simplify bookkeeping and fee 
calculation burdens on the permittee and the Forest Service, the 
Secretary shall each year provide the permittee with a standardized 
form and worksheets (including annual fee calculations brackets and 
rates) to be utilized for fee calculation and submitted with the fee 
payment. Information provided on such forms shall be compiled by the 
Secretary annually and kept in the Office of the Chief, United States 
Forest Service.
    ``(e) Definitions.--To simplify bookkeeping and administrative 
burdens on ski area permittees and the Forest Service, as used in this 
section, the terms `revenue' and `sales' mean actual income from sales. 
Such terms do not include sales of operating equipment, refunds, rent 
paid to the permittee by sublessees, sponsor contributions to special 
events or any amounts attributable to employee gratuities, discounts, 
complimentary lift tickets, or other goods or services (except for 
bartered goods) for which the permittee does not receive money.
    ``(f) Effective Date for Fees.--The ski area permit fees as 
provided under this section shall become effective on July 1, 1996, and 
cover receipts retroactive to July 1, 1995. If a ski area permittee has 
paid fees for the 12-month period ending on June 30, 1996, under the 
graduated rate fee system formula in effect prior to the date of the 
enactment of this section, such fees shall be credited toward the new 
ski area permit fee due for that period under this section.
    ``(g) Report on Fair Market Value.--No later than five years after 
the date of enactment of this section and every 10 years thereafter, 
the Secretary shall submit to the Committee on Energy and Natural 
Resources of the United States Senate and the Committees of Agriculture 
and Resources of the United States House of Representatives a report 
analyzing whether the ski area permit fee system legislated by this 
section is returning a fair market value rental to the United States 
together with any recommendations the Secretary may have for 
modifications in the system.
    ``(h) Transition Period.--Where the new fee provided for in this 
section results in an increase in permit fee greater than one percent 
of the permittee's adjusted gross revenue (as defined in subsection 
(b)(1)), the new fee shall be phased in over a three year period in a 
manner providing for increases of approximately equal increments.
    ``(i) Applicability of NEPA to Reissuance of Ski Area Permits.--The 
reissuance of a ski area permit to provide activities similar in nature 
and amount to the activities provided under the previous permit is 
hereby determined to be a categorical exclusion as provided for under 
the National Environmental Policy Act of 1969 (42 U.S.C. 4331 et seq.).

``SEC. 5. WITHDRAWAL OF SKI AREAS FROM OPERATION OF MINING LAWS.

    ``Subject to valid existing rights, all lands located within the 
boundaries of ski area permits issued prior to, on, or after the date 
of the enactment of this section pursuant to the authority of the Act 
of March 4, 1915 (16 U.S.C. 497), the Act of June 4, 1897 (16 U.S.C. 
473 et seq.), or section 3 of this Act are hereby and henceforth 
automatically withdrawn from all forms of appropriation under the 
mining laws and from disposition under all laws pertaining to mineral 
and geothermal leasing. Such withdrawal shall continue for the full 
term of the permit and any modification, reissuance, or renewal of the 
permit. Such withdrawal shall be canceled automatically upon expiration 
or other termination of the permit unless, at the request of the 
Secretary of Agriculture, the Secretary of the Interior determines to 
continue the withdrawal. Upon cancellation of the withdrawal, the land 
shall be automatically restored to all appropriation not otherwise 
restricted under the public land laws.''.

                   PART 3--DOMESTIC LIVESTOCK GRAZING

SEC. 9331. APPLICABLE REGULATIONS.

    (a) BLM Lands.--Except as otherwise provided by this part, grazing 
of domestic livestock on lands administered by the Bureau of Land 
Management shall be in accordance with part 1780 and part 4100 of title 
43, Code of Federal Regulations, as in effect on January 1, 1995.
    (b) Forest Service Lands.--Except as otherwise provided by this 
part, grazing of domestic livestock on lands administered by the Forest 
Service shall, to the extent possible, be in accordance with 
regulations, which the Secretary of Agriculture shall promulgate, which 
are substantially similar to the regulations referred to in subsection 
(a). Regulations promulgated under this subsection may differ from the 
regulations referred to in subsection (a) to the extent necessary to 
conform to the laws governing the National Forest System (other than 
this part).
    (c) Federal Lands.--For the purposes of this part, the term 
``Federal lands'' means lands administered by the Bureau of Land 
Management and lands administered by the Forest Service.

SEC. 9332. FEES AND CHARGES.

    (a) Basic Fee.--The basic fee for each animal unit month in a 
grazing fee year to be determined by the Bureau of Land Management and 
the Forest Service shall be equal to the 3-year average of the total 
gross value of production for beef cattle, as compiled by the Economic 
Research Service of the Department of Agriculture in accordance with 
subsection (b) on the basis of economic data published by the Service 
in the Economic Indicators of the Farm Sector: Cost of Production--
Major Field Crops & Livestock and Dairy for the 3 years preceding the 
grazing fee year, multiplied by the 10 year average of the United 
States Treasury Securities 6-month bill ``new issue'' rate and divided 
by 12.
    (b) Criteria.--The Economic Research Service of the Department of 
Agriculture shall continue to compile the gross production value of 
production of beef cattle as reported in a dollar per bred cow basis in 
the ``U.S. Cow-Calf Production Cash Costs and Returns''.
    (c) Surcharge.--
            (1) In general.--A surcharge shall be added to the grazing 
        fee billings for authorized grazing of livestock owned by 
        persons other than the permittee or lessee except where--
                    (A) such use is made by livestock owned by a 
                spouse, child, or grandchild or their respective spouse 
                of the permittee and lessee; or
                    (B) the permittee or lessee is unable to make full 
                grazing use, as authorized by a grazing permit or 
                lease, due to the infirmed condition or death of the 
                permittee or lessee.
            (2) Treatment as additional fee.--The surcharge shall be 
        over and above any other fees that may be charged for using 
        public land forage.
            (3) Prior payment required.--Surcharges shall be paid prior 
        to grazing use.
            (4) Amount.--The surcharge for authorized pasturing of 
        livestock owned by persons other than the permittee or lessee 
        shall be equal to 25 percent of the difference between the 
        current year's Federal grazing fee and the prior year's private 
        grazing land lease rate per AUM for the appropriate State as 
        compiled by the National Agricultural Statistics Service.
            (5) In general.--The Bureau of Land Management and the 
        Forest Service shall make a determination under subsection (a) 
        based on the following information gathered by the National 
        Agriculture Statistics Service of the Department of Agriculture 
        with respect to the largest single grazing lease of each 
        grazing operator (in terms of dollars):
                    (A) Whether the operator charged--
                            (i) per acre;
                            (ii) per head per month;
                            (iii) per pound of gain;
                            (iv) per hundredweight of gain; or
                            (v) by another measure, and the rate 
                        charged.
                    (B)(i) The estimated average pounds gained per 
                season for the grazing lease.
                    (ii) The total dollar amount estimated to be 
                realized from the grazing lease.
                    (iii) Grazing lease acreage.
                    (iv) The State and county where the grazing lease 
                is located.
                    (C) The classes of livestock grazed.
                    (D) The term of the grazing lease.
                    (E)(i) Whether grazing lease payments are paid if 
                no grazing occurred.
                    (ii) Whether the grazing lease contains a take or 
                pay provision.
                    (F) Additional information on whether the following 
                are provided by the landlord on a 5-year basis:
                            (i) Fencing maintenance.
                            (ii) Animal management and oversight.
                            (iii) Water maintenance.
                            (iv) Salt and minerals.
                            (v) Other service (specified).
                            (vi) No services.
                            (vii) Hunting.
                            (viii) Fishing.
                            (ix) Other (specified).
                            (x) None.
            (6) Private native rangeland.--For the purpose of 
        determining rates for grazing leases of private native 
        rangeland, rates for irrigated pasture, crop aftermath, and 
        dryland winter wheat shall be excluded.

SEC. 9333. ANIMAL UNIT MONTH.

    (a) Definition of Animal Unit Month.--The term ``animal unit 
month'' means 1 month's use and occupancy of range by--
            (1) 1 cow, bull, steer, heifer, horse, burro, or mule, 7 
        sheep, or 7 goats, each of which is 6 months of age or older on 
        the date on which the animal begins grazing on Federal land;
            (2) any such animal regardless of age if the animal is 
        weaned on the date on which the animal begins grazing on 
        Federal land; and
            (3) any such animal that will become 12 months of age 
        during the period of use authorized under a grazing permit or 
        grazing lease.
    (b) Livestock Not Counted.--There shall not be counted as an animal 
unit month the use of Federal land for grazing by an animal that is 
less than 6 months of age on the date on which the animal begins 
grazing on Federal land and is the natural progeny of an animal on 
which a grazing fee is paid if the animal is removed from the Federal 
land before becoming 12 months of age.

SEC. 9334. TERM OF GRAZING PERMITS OR GRAZING LEASES.

    A grazing permit or grazing lease shall be issued for a term of 15 
years unless--
            (1) the land is pending disposal;
            (2) the land will be devoted to a public purpose that 
        precludes grazing prior to the end of 15 years; or
            (3) the Secretary determines that it would be in the best 
        interest of sound land management to specify a shorter term, if 
        the decision to specify a shorter term is supported by 
        appropriate and accepted resource analysis and evaluation.

SEC. 9335. CONFORMANCE WITH LAND USE PLAN.

    Livestock grazing activities and management actions approved by the 
Secretary of the Interior or the Secretary of Agriculture, as the case 
may be--
            (1) may include any such activities as are not clearly 
        prohibited by a land use plan; and
            (2) shall not require any consideration under the National 
        Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) in 
        addition to the studies supporting the land use plan.

SEC. 9336. EFFECTIVE DATE.

    This part shall apply to grazing on Federal lands on and after the 
date of the enactment of this Act.

     PART 4--REGIONAL DISPOSAL FACILITY OF SOUTHWESTERN LOW LEVEL 
                   RADIOACTIVE WASTE DISPOSAL COMPACT

SEC. 9341. CONVEYANCE OF PROPERTY.

    (a) Conveyance.--Upon the tendering of $500,000 on behalf of the 
State of California and the release of the United States by the State 
of California from any liability for claims relating to the property 
described in subsection (b), all right, title and interest of the 
United States in and to said lands and improvements thereon are 
conveyed to the Department of Health Services of the State of 
California: Provided, That the property shall revert to the United 
States if the property is not used as a low-level radioactive waste 
disposal facility.
    (b) Description.--The lands conveyed are those depicted on a map 
designated USGS 7.5 minute quadrangle, west of Flattop Mtn, CA 1984, 
entitled ``Location Map for Ward Valley Site'', located in San 
Bernardino Meridian, Township 9 North, Range 19 East.
    (c) Title.--The Secretary of the Interior shall issue evidence of 
title pursuant to this Act notwithstanding any other provision of law. 
The Southwestern Low-Level Radioactive Waste Disposal Compact's Ward 
Valley regional disposal facility and transfer of the land are in 
compliance with any applicable provisions of section 7 of Endangered 
Species Act of 1973 (16 U.S.C. 1536) and the National Environmental 
Policy Act of 1969 (42 U.S.C. 4332).
    (d) Deposit of Funds.--Sums received pursuant to subsection (a) 
shall be deposited as miscellaneous receipts in the Treasury of the 
United States.
    (e) Expiration of Authority.--This authority expires October 1, 
2010.

SEC. 9342. CONVEYANCE OF EASEMENTS.

    Concurrent with the conveyance property described in section 
9341(b) to the Department of Health Services of the State of 
California, all necessary easements for utilities and ingress and 
egress to said lands described in section 9341(b) of this Act and the 
right to improve those easements, are also conveyed to the Department 
of Health Services of the State of California: Provided, That the 
Department of Health Services right-of-way easements revert to the 
United States if the lands referenced in section 9341 are not licensed 
and used as a low-level radioactive waste disposal facility.

                        Subtitle D--Territories

          PART 1--COMMONWEALTH OF THE NORTHERN MARIANA ISLANDS

SEC. 9401. TERMINATION OF ANNUAL DIRECT GRANT ASSISTANCE.

    (a) Termination.--Pursuant to section 704(d) of the Covenant to 
Establish a Commonwealth of the Northern Mariana Islands in Political 
Union with the United States of America (48 U.S.C. 1681 note), the 
annual payments under section 702 of the Covenant shall terminate as of 
September 30, 1995.
    (b) Repeal.--Sections 3 and 4 of the Act of March 24, 1976 (Public 
Law 94-241; 48 U.S.C. 1681 note), as amended, are repealed, effective 
October 1, 1995.
    (c) Removal of Authority To Obligate Certain Funds.--Amounts 
appropriated under title VII of the Covenant to Establish a 
Commonwealth of the Northern Mariana Islands in Political Union with 
the United States of America, and under sections 3 and 4 of Public Law 
94-241 (48 U.S.C. 1681), which are not obligated as of the date of the 
enactment of this Act may not be obligated after such date.
    (d) Conforming Amendments.--Section 5 of such Act (48 U.S.C. 1681 
note) is amended--
            (1) by striking out ``agreement identified in section 3 of 
        this Act'' and inserting in lieu thereof ``Agreement of the 
        Special Representatives on Future United States Financial 
        Assistance for the Government of the Northern Mariana Islands, 
        executed July 10, 1985, between the special representative of 
        the President of the United States and the special 
        representatives of the Governor of the Northern Mariana 
        Islands''; and
            (2) by striking out ``Committee on Interior and Insular 
        Affairs'' and inserting in lieu thereof ``Committee on 
        Resources''.

            PART 2--TERRITORIAL ADMINISTRATIVE CESSATION ACT

SEC. 9421. SHORT TITLE.

    This part may be cited as the ``Territorial Administrative 
Cessation Act''.

SEC. 9422. CONGRESSIONAL FINDINGS.

    The Congress finds that--
            (1) each of the four political subdivisions of the United 
        Nations Trust Territory of the Pacific Islands, known as the 
        Japanese Mandated Islands, have successfully entered into 
        distinct self-governing entities, thereby culminating in the 
        final termination of the Trusteeship and the end of the 
        trusteeship responsibilities of the United States as 
        administering authority of the Trust Territory on October 1, 
        1994;
            (2) the United States territories have developed 
        progressively increased local self-government over the past 
        five decades;
            (3) the territories predominantly deal directly with 
        Federal agencies and departments, as a State would;
            (4) the administering responsibilities of the Department of 
        the Interior with respect to the insular areas has declined 
        substantially during the past five decades; and
            (5) Federal-territorial relations can be enhanced and 
        Federal fiscal conditions improved by the elimination of 
        unnecessary Federal bureaucracy.

SEC. 9423. ELIMINATION OF OFFICE OF TERRITORIAL AND INTERNATIONAL 
                    AFFAIRS.

    (a) In General.--The Office of Territorial and International 
Affairs of the Department of the Interior, established pursuant to the 
Order of the Secretary of the Interior 3046, of February 14, 1980, as 
amended, is hereby abolished.
    (b) Termination of Position of Assistant Secretary.--Section 5315 
of title 5, United States Code, is amended by striking ``Assistant 
Secretaries of the Interior (6)'' and inserting ``Assistant Secretaries 
of the Interior (5)''.
    (c) Effective Date.--Subsection (a) and the amendment made by 
subsection (b) shall take effect on the first day of the first fiscal 
year that begins after the date of the enactment of this Act.

SEC. 9424. CERTAIN ACTIVITIES NOT FUNDED.

    Amounts may not be made available for the following program 
activities for assistance to territories for fiscal years beginning 
after September 30, 1995, as identified under the appropriations 
account numbered 14-0412-0-1-808:
            (1) technical assistance, item 00.12;
            (2) maintenance assistance, item 00.14;
            (3) disaster fund, item 00.17; and
            (4) insular management controls, item 00.19.

                          Subtitle E--Minerals

                        PART 1--HARDROCK MINING

SEC. 9501. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds and declares that--
            (1) a secure and reliable supply of locatable minerals is 
        essential to the industrial base of the United States, national 
        security, and balance of trade;
            (2) many of the deposits of locatable minerals that may be 
        commercially developed are on Federal lands as that term is 
        defined in this Act, and are difficult and expensive to 
        discover, mine, extract and process;
            (3) the national need for locatable minerals will continue 
        to expand, and without a strong mining industry the demand for 
        the minerals will exceed domestic sources of supply;
            (4) mining of locatable minerals is an extremely high-risk, 
        capital-intensive endeavor, which, to attract necessary 
        investment, requires certainty and predictability in access to 
        Federal lands in establishment of mining titles, and in the 
        rights of owners of mining claims or sites to develop minerals;
            (5) the national interest is to foster and encourage 
        private enterprise in the development of a domestic minerals 
        industry to maintain and create high-paying jobs and the 
        various Federal, State, and local taxes paid by the mining 
        industry in the United States;
            (6) changes in the general mining laws of the United States 
        to provide more direct economic return to the United States and 
        greater protection of public resources are desirable, so long 
        as these changes do not act as a disincentive to development of 
        minerals, adversely affect employment in the mining industry or 
        in industries that provide goods and services required for 
        mining activities, interfere with a secure and reliable 
        domestic supply of minerals, or adversely affect the balance of 
        trade of the United States; and
            (7) mining claims, mill sites and tunnel sites located 
        under the general mining laws are property interests, and any 
        law or regulation that substantially impairs existing property 
        rights may expose the Federal Government to takings claims 
        under the fifth amendment to the United States Constitution.
    (b) Purpose.--It is the purpose of this subtitle to--
            (1) affirm and maintain the policy established in section 2 
        of the Mining and Minerals Policy Act of 1970;
            (2) promote exploration for and the development of a secure 
        and reliable domestic source of locatable minerals;
            (3) provide for increased Federal revenue from the location 
        and production of locatable minerals from Federal lands through 
        patent payments and royalties; and
            (4) recognize that unpatented mining claims, mill sites and 
        tunnel sites are property rights in the fullest sense and 
        avoid, to the greatest extent possible, claims of takings of 
        existing property rights under the general mining laws that 
        could require compensation under the fifth amendment to the 
        United States Constitution.

SEC. 9502. PATENTS UNDER THE GENERAL MINING LAW.

    (a) In General.--Any patent issued by the United States under the 
general mining laws after the date of the enactment of this Act for any 
interest in land covered by a mining claim or site under such laws 
shall be issued only--
            (1) upon payment by the owner of the mining claim or site 
        of the fair market value for the interest in the land owned by 
        the United States exclusive of, and without regard to, the 
        mineral deposits in the land or the use of such land for 
        mineral activities unless the requirements of subsection (b) 
        are met, and
            (2) subject to a reservation by the United States of the 
        royalty provided in section 9503(a), unless the requirements in 
        subsection (b) are met.
    (b) Patent Transition.--(1) Subsection (a) shall not apply to any 
mining claim or site if--
            (A) the claimant establishes that the claim or site 
        constituted a valid mining claim as of the date of the 
        enactment of this Act; and
            (B) the claimant has filed a patent application or mineral 
        survey application prior to the date of the enactment of this 
        Act, or files such an application with the Bureau of Land 
        Management before the date 2 years after the date of the 
        enactment of this Act. A patent application or mineral survey 
        application referred to in this subparagraph shall be deemed 
        timely, notwithstanding that the application may be corrected 
        or supplemented and resubmitted thereafter.
    (2) During the 2-year period in paragraph (1)(B), or while there is 
pending a mineral survey or patent application to which this subsection 
applies, an owner of the mining claim or site may continue work on a 
mining claim or site directed toward establishment and confirmation of 
entitlement to a patent, and may amend the application as necessary.
    (3) Where access to any mining claim or site has been denied or 
impeded by the action or inaction of any Federal official, agency, or 
court during all or part of the 5-year period preceding the date of 
enactment of this Act, including any mining claim or site within the 
area described in section 106 of Public Law 103-433, and the mining 
claim or site may require further exploration or development in order 
for the claimant to file a patent application or a mineral survey 
application and otherwise meet the requirements of paragraph (1), the 
claimant may, within 1 year after the date of enactment of this Act, 
submit a certified written statement to the Secretary describing the 
access denial or impediment, and shall then have a period of 10 years 
from the date of enactment of this Act or the termination of such 
access denial or impediment, whichever occurs first, to conduct such 
mineral exploration or development activities, file a patent 
application or mineral survey application, and otherwise meet the 
requirements of paragraph (1).
    (c) Payment Plan.--(1) Any owner grossing less than $500,000 
annually shall qualify for a payment plan. Upon completion of the 
patent process, the owner of the mining claim may purchase the surface 
estate under the following conditions:
            (A) Payment to be amortized over 5 years with 5 equal 
        annual payments, including principal and interest.
            (B) Interest shall be calculated per annum at a rate of 2 
        percent over the ``Treasury Current Value of Funds Rate'' on 
        the date of execution of the payment plan agreement.
    (2) The purchaser shall be notified by certified mail after 60 days 
of delinquent payments and have 90 days from receipt of notification to 
correct the delinquency. Repossession shall be by and under the laws of 
repossession, foreclosure, and replevin of the State wherein the land 
is situated.
    (d) Repeal of Patenting Moratorium; Processing of Patent 
Applications.--Sections ____ and ____ of Public Law ____ are hereby 
repealed. The Secretary of the Interior shall diligently process all 
patent applications under the general mining laws pending on the date 
of enactment and shall make determinations for all such applications 
regarding patent issuance within 2 years.

SEC. 9503. ROYALTY UNDER THE GENERAL MINING LAW.

    (a) In General.--The production and sale of locatable minerals 
(including associated minerals) from any unpatented mining claim (other 
than those from Federal lands to which subsection 9502(b) applies) or 
any mining claim patented under section 9502(a) shall be subject to a 
royalty of 3.5 percent on the net proceeds from such production mined 
and sold from such claim.
    (b) Royalty Exclusion.--(1) The royalty payable under this section 
shall be waived for any person or corporation with annual net proceeds 
from mineral production subject to subsection (a) of less than $50,000.
    (2) Where mining operations subject to this section are conducted 
in 2 or more places by 1 person or corporation, the operations shall be 
considered a single operation the aggregate net proceeds from which 
shall be subject to the $50,000 limitation set forth in this 
subsection.
    (3) No royalty shall be payable under this section with respect to 
minerals processed at a facility by the same person or entity which 
extracted the minerals if an urban development action grant has been 
made under section 119 of the Housing and Community Development Act of 
1974 with respect to any portion of such facility.
    (4) The obligation to pay royalties under this section shall accrue 
only upon the sale of locatable minerals or mineral products produced 
from a mining claim subject to such royalty, and not upon the 
stockpiling of the same for future processing.
    (c) Definitions.--For the purposes of this subtitle:
            (1) The term ``net proceeds'' means gross yield, less the 
        sum of the following deductions for costs incurred prior to 
        sale or value determination, and none other:
                    (A) The actual cost of extracting the locatable 
                mineral.
                    (B) The actual cost of transporting the locatable 
                mineral from the claim to the place or places of 
                reduction, beneficiation, refining, and sale.
                    (C) The actual cost of crushing, processing, 
                reduction, beneficiation, refining, and sale of the 
                locatable mineral.
                    (D) The actual cost of marketing and delivering the 
                locatable mineral and the conversion of the locatable 
                mineral into money.
                    (E) The actual cost of maintenance and repairs of--
                            (i) all machinery, equipment, apparatus, 
                        and facilities used in the mine;
                            (ii) all crushing, milling, leaching, 
                        refining, smelting, and reduction works, 
                        plants, and facilities; and
                            (iii) all facilities and equipment for 
                        transportation.
                    (F) The actual cost for support personnel and 
                support services at the mine site, including without 
                limitation, accounting, assaying, drafting and mapping, 
                computer services, surveying, housing, camp, and office 
                expenses, safety, and security.
                    (G) The actual cost of engineering, sampling, and 
                assaying pertaining to development and production.
                    (H) The actual cost of permitting, reclamation, 
                environmental compliance and monitoring.
                    (I) The actual cost of fire and other insurance on 
                the machinery, equipment, apparatus, works, plants, and 
                facilities mentioned in subparagraph (E).
                    (J) Depreciation of the original capitalized cost 
                of the machinery, equipment, apparatus, works, plants, 
                and facilities listed in subparagraph (E). The annual 
                depreciation charge shall consist of amortization of 
                the original cost in the manner consistent with the 
                Internal Revenue Code of 1986, as amended from time to 
                time. The probable life of the property represented by 
                the original cost must be considered in computing the 
                depreciation charge.
                    (K) All money expended for premiums for industrial 
                insurance, and the owner paid cost of hospital and 
                medical attention and accident benefits and group 
                insurance for all employees engaged in the production 
                or processing of locatable minerals.
                    (L) All money paid as contributions or payments 
                under State unemployment compensation law, all money 
                paid as contributions under the Federal Social Security 
                Act, and all money paid to State government in real 
                property taxes and severance or other taxes measured or 
                levied on production, or Federal excise tax payments 
                and payments as fees or charges for use of the Federal 
                lands from which the locatable minerals are produced.
                    (M) The actual cost of the developmental work in or 
                about the mine or upon a group of mines when operated 
                as a unit.
            (2) The term ``gross yield'' shall having the following 
        meaning:
                    (A) In the case of sales of gold and silver ore, 
                concentrates or bullion, or the sales of other 
                locatable minerals in the form of ore or concentrates, 
                the term ``gross yield'' means the actual proceeds of 
                sale of such ore, concentrates or bullion.
                    (B) In the case of sales of beneficiated products 
                from locatable minerals other than those subject to 
                subparagraph (A) (including cathode, anode or copper 
                rod or wire, or other products fabricated from the 
                locatable minerals), the term ``gross yield'' means the 
                gross income from mining derived from the first 
                commercially marketable product determined in the same 
                manner as under section 613 of the Internal Revenue 
                Code of 1986.
                    (C) If ore, concentrates, beneficiated or 
                fabricated products, or locatable minerals are used or 
                consumed and are not sold in an arms length 
                transaction, the term ``gross yield'' means the 
                reasonable fair market value of the ore, concentrates, 
                beneficiated or fabricated products at the mine or 
                wellhead determined from the first applicable of the 
                following:
                            (i) Published or other competitive selling 
                        prices of locatable minerals of like kind and 
                        grade.
                            (ii) Any proceeds of sale.
                            (iii) Value received in exchange for any 
                        thing or service.
                            (iv) The value of any locatable minerals in 
                        kind or used or consumed in a manufacturing 
                        process or in providing a service.
                Without limiting the foregoing, the profits or losses 
                incurred in connection with forward sales, futures or 
                commodity options trading, metal loans, or any other 
                price hedging or speculative activity or arrangement 
                shall not be included in gross yield.
            (3) The term ``Secretary'' means the Secretary of the 
        Interior.
    (d) Limitations and Allocations of Net Proceeds, Gross Yield, and 
Allowable Costs.--(1) The deductions listed in subsection (c)(1) are 
intended to allow a reasonable allowance for overhead. Such deductions 
shall not include any expenditures for salaries, or any portion of 
salaries, of any person not actually engaged in--
            (A) the working of the mine;
            (B) the operating of the leach pads, ponds, plants, mills, 
        smelters, or reduction works;
            (C) the operating of the facilities or equipment for 
        transportation; or
            (D) superintending the management of any of those 
        operations described in subparagraphs (A) through (C).
    (2) Ores or solutions of locatable minerals subject to the royalty 
requirements of this section may be extracted from mines comprised of 
mining claims and lands other than mining claims and ore or solutions 
of locatable minerals subject to the royalty requirements of this 
section may be commingled with ores or solutions from lands other than 
mining claims. In any such case, for purposes of determining the amount 
of royalties payable under this section--
            (A) the operator shall first sample, weigh or measure, and 
        assay the same in accordance with accepted industry standards; 
        and
            (B) gross yield, allowable costs and net proceeds for 
        royalty purposes shall be allocated in proportion to mineral 
        products recovered from the mining claims in accordance with 
        accepted industry standards.
    (e) Liability for Royalty Payments.--The owner or co-owners of a 
mining claim subject to a royalty under this section shall be liable 
for such royalty to the extent of the interest in such claim owned. As 
used in this subsection, the terms ``owner'' and ``co-owner'' mean the 
person or persons owning the right to mine locatable minerals from such 
claim and receiving the net proceeds of such sale. No person who makes 
any royalty payment attributable to the interest of the owner or co-
owners liable therefor shall become liable to the United States for 
such royalty as a result of making such payment on behalf of such owner 
or co-owners.
    (f) Time and Manner of Payment.--(1) Royalty payments for 
production from any mining claim subject to the royalty payable under 
this section shall be due to the United States at the end of the month 
following the end of the calendar quarter in which the net proceeds 
from the sale of such production are received by the owner or co-
owners. Royalty payments may be made based upon good faith estimates of 
the gross yield, net proceeds and the quantity of ore, concentrates, or 
other beneficiated or fabricated products of locatable minerals, 
subject to adjustment when the actual annual gross yield, net proceeds 
and quantity are determined by the owner of the mining claim or site or 
co-owners.
    (2) Each royalty payment or adjustment shall be accompanied by a 
statement containing each of the following:
            (A) The name and Bureau of Land Management serial number of 
        the mining claim or claims from which ores, concentrates, 
        solutions or beneficiated products of locatable minerals 
        subject to the royalty required in this section were produced 
        and sold for the period covered by such payment or adjustment.
            (B) The estimated (or actual, if determined) quantity of 
        such ore, concentrates, solutions or beneficiated or fabricated 
        products produced and sold from such mining claim or claims for 
        such period.
            (C) The estimated (or actual, if determined) gross yield 
        from the production and sale of such ore, concentrates, 
        solutions or beneficiated products for such period.
            (D) The estimated (or actual, if determined) net proceeds 
        from the production and sale of such ores, concentrates, 
        solutions or beneficiated products for such period, including 
        an itemization of the applicable deductions described in 
        subsection (c)(1).
            (E) The estimated (or actual, if determined) royalty due to 
        the United States, or adjustment due to the United States or 
        such owner or co-owners, for such period.
    (3) In lieu of receiving a refund under subsection (h), the owner 
or co-owners may elect to apply any adjustment due to such owner or co-
owners as an offset against royalties due from such owner or co-owners 
to the United States under this Act, regardless of whether such 
royalties are due for production and sale from the same mining claim or 
claims.
    (g) Recordkeeping and Reporting Requirements.--(1) An owner, 
operator, or other person directly involved in the conduct of mineral 
activities, transportation, purchase, or sale of locatable minerals, 
concentrates, or products derived therefrom, subject to the royalty 
under this section, through the point of royalty computation, shall 
establish and maintain any records, make any reports, and provide any 
information that the Secretary may reasonably require for the purposes 
of implementing this section or determining compliance with regulations 
or orders under this section. Upon the request of the Secretary when 
conducting an audit or investigation pursuant to subsection (i), the 
appropriate records, reports, or information required by this 
subsection shall be made available for inspection and duplication by 
the Secretary.
    (2) Records required by the Secretary under this section shall be 
maintained for 3 years after the records are generated unless the 
Secretary notifies the record holder that he or she has initiated an 
audit or investigation specifically identifying and involving such 
records and that such records must be maintained for a longer period. 
When an audit or investigation is under way, such records shall be 
maintained until the earlier of the date that the Secretary releases 
the record holder of the obligation to maintain such records or the 
date that the limitations period applicable to such audit or 
investigation under subsection (i) expires.
    (h) Interest Assessments.--(1) If royalty payments under this 
section are not received by the Secretary on the date that such 
payments are due, or if such payments are less than the amount due, the 
Secretary shall charge interest on such unpaid amount. Interest under 
this subsection shall be computed at the rate published by the 
Department of the Treasury as the ``Treasury Current Value of Funds 
Rate.'' In the case of an underpayment or partial payment, interest 
shall be computed and charged only on the amount of the deficiency and 
not on the total amount, and only for the number of days such payment 
is late. No other late payment or underpayment charge or penalty shall 
be charged with respect to royalties under this section.
    (2) In any case in which royalty payments are made in excess of the 
amount due, or amounts are held by the Secretary pending the outcome of 
any appeal in which the Secretary does not prevail, the Secretary shall 
promptly refund such overpayments or pay such amounts to the person or 
persons entitled thereto, together with interest thereon for the number 
of days such overpayment or amounts were held by the Secretary, with 
the addition of interest charged against the United States computed at 
the rate published by the Department of the Treasury as the ``Treasury 
Current Value of Funds Rate.''
    (i) Audits, Payment Demands and Limitations.--(1) The Secretary may 
conduct, after notice, any audit reasonably necessary and appropriate 
to verify the payments required under this section.
    (2) The Secretary shall send or issue any billing or demand letter 
for royalty due on locatable minerals produced and sold from any mining 
claim subject to royalty required by this section not later than 3 
years after the date such royalty was due and must specifically 
identify the production involved, the royalty allegedly due and the 
basis for the claim. No action, proceeding or claim for royalty due on 
locatable minerals produced and sold, or relating to such production, 
may be brought by the United States, including but not limited to any 
claim for additional royalties or claim of the right to offset the 
amount of such additional royalties against amounts owed to any person 
by the United States, unless judicial suit or administrative 
proceedings are commenced to recover specific amounts claimed to be due 
prior to the expiration of 3 years from the date such royalty is 
alleged to have been due.
    (j) Transitional Rules.--Any mining claim for which a patent is 
issued pursuant to section 9502(b) shall not be subject to the 
obligation to pay the royalty pursuant to this section. Royalty 
payments for any claim processed under section 9502(b) shall be 
suspended pending final determination of the right to patent. For any 
such claim that is determined not to qualify for the issuance of a 
patent under section 9502(b), royalties shall be payable under this 
section on production after the date of enactment of this Act, plus 
interest computed at the rate published by the Department of the 
Treasury as the ``Treasury Current Value of Funds Rate'' on production 
after such date of enactment and before the date of such determination.
    (k) Disbursement of Revenues.--The receipts from royalties 
collected under this section shall be disbursed as follows:
            (1) Two-thirds of such receipts shall be paid into the 
        Treasury of the United States and deposited as miscellaneous 
        receipts.
            (2) One-third of such receipts shall be paid by the 
        Secretary of the Treasury to the State in which the mining 
        claim from which production occurred is located.
    (l) No Implied Covenants.--The owner of a mining claim subject to 
the provisions of this title shall have no obligation, express or 
implied, to explore for, develop, produce or market locatable minerals 
as a result of the obligation to pay a royalty hereunder, and the 
timing, nature, extent and manner of exploring, developing, mining and 
marketing such locatable minerals shall be in the sole discretion of 
the claim owner.

SEC. 9504. MINERAL MATERIALS.

    (a) Determinations.--Section 3 of the Act of July 23, 1955 (30 
U.S.C. 611), is amended as follows:
            (1) Insert ``(a)'' before the first sentence.
            (2) Add the following new subsection at the end thereof:
    ``(b)(1) Subject to valid existing rights, after the date of 
enactment of this subsection, notwithstanding the reference to common 
varieties in subsection (a) and to the exception to such term relating 
to a deposit of materials with some property giving it distinct and 
special value, all deposits of mineral materials referred to in such 
subsection, including the block pumice referred to in such subsection, 
shall be subject to disposal only under the terms and conditions of the 
Materials Act of 1947.
    ``(2) For purposes of paragraph (1), the term `valid existing 
rights' means that a mining claim located for any such mineral material 
had some property giving it the distinct and special value referred to 
in subsection (a), or as the case may be, met the definition of block 
pumice referred to in such subsection, was properly located and 
maintained under the general mining laws prior to the date of the 
enactment of this subsection, and was supported by a discovery of a 
valuable mineral deposit within the meaning of the general mining laws 
as in effect immediately prior to such date of enactment and that such 
claim continues to be valid under this Act.''.
    (b) Identified Deposits.--In order to assure that the Secretary has 
the authority to provide for the development of mineral materials 
which, in order to justify the investment necessary for the development 
of the appropriate mine, quarry or other workings and related 
facilities, may require longer and more secure tenure than is provided 
by sales contracts under the Act entitled ``An Act to provide for the 
disposal of materials on the public lands of the United States'', 
approved July 31, 1947 (30 U.S.C. 602), and in order to provide 
flexibility with regard to the manner of disposition of mineral 
materials section 2 of such Act is amended by adding at the end the 
following:
    ``(b) Identified Deposits.--(1) Lands known to contain valuable 
deposits of mineral materials subject to this Act and subsequent 
amendments and not covered by any contract, permit, or lease under this 
section shall also be subject to disposition by lease under this Act by 
the Secretary of the Interior through advertisement, competitive 
bidding, or such other methods as he may by general regulations adopt, 
and in such reasonably compact areas as he shall fix.
    ``(2) All leases will be conditioned upon--
            ``(A) the payment by the lessee of such royalty as may be 
        fixed in the lease, not less than two percent of the quantity 
        or gross value of the output of mineral materials, and
            ``(B) the payment in advance of a rental of 25 cents per 
        acre for the first calendar year or fraction thereof; 50 cents 
        per acre for the second, third, fourth, and fifth years, 
        respectively; and $1 per acre per annum thereafter during the 
        continuance of the lease, such rental for that year being 
        credited against royalties accruing for that year.
    ``(3)(A) Any lease issued under this subsection shall be for a term 
of 20 years and so long thereafter as the lessee complies with the 
terms and conditions of the lease and upon the further condition that 
at the end of each 20-year period succeeding the date of the lease such 
reasonable adjustment of the terms and conditions thereof may be made 
therein as may be prescribed by the Secretary of the Interior unless 
otherwise provided by law at the expiration of such periods.
    ``(B) Leases shall be conditioned upon a minimum annual production 
or the payment of a minimum royalty in lieu thereof, except when 
production is interrupted by strikes, the elements, or casualties not 
attributable to the lessee.
    ``(C) The Secretary of the Interior may permit suspension of 
operations under any such leases when marketing conditions are such 
that the leases cannot be operated except at a loss.
    ``(D) The Secretary upon application by the lessee prior to the 
expiration of any existing lease in good standing shall amend such 
lease to provide for the same tenure and to contain the same 
conditions, including adjustment at the end of each 20-year period 
succeeding the date of said lease, as provided for in this subsection.
    ``(c) Other Lands.--(1) The Secretary of the Interior is hereby 
authorized, under such rules and regulations as he may prescribe, to 
grant to any qualified applicant a prospecting permit which shall give 
the exclusive right to prospect for mineral materials in lands 
belonging to the United States which are not subject to subsection (b), 
and are not covered by a contract, permit, or lease under this Act, 
except that a prospecting permit shall not exceed a period of 2 years 
and the area to be included in such a permit shall not exceed 2,560 
acres of land in reasonably compact form.
    ``(2) The Secretary of the Interior shall reserve and may exercise 
the authority to cancel any prospecting permit upon failure by the 
permittee to exercise due diligence in the prosecution of the 
prospecting work in accordance with the terms and conditions stated in 
the permit, and shall insert in every such permit issued under the 
provisions of this Act appropriate provisions for its cancellation by 
him.
    ``(3) Upon showing to the satisfaction of the Secretary of the 
Interior that valuable deposits of one of the mineral materials subject 
to the Materials Act of 1947 have been discovered by the permittee 
within the area covered by his permit, and that such land is valuable 
therefor, the permittee shall be entitled to a lease for any or all of 
the land embraced in the prospecting permit, at a royalty of not less 
than two percent of the quantity or gross value of the output of the 
mineral materials at the point of shipment to market, such lease to be 
taken in compact form by legal subdivisions of the public land surveys, 
or if the land be not surveyed, by survey executed at the cost of the 
permittee in accordance with regulations prescribed by the Secretary of 
the Interior.''.
    (d) Mineral Materials Disposal Clarification.--Section 4 of the Act 
of July 23, 1955 (30 U.S.C. 612), as amended as follows:
            (1) In subsection (b) insert ``and mineral material'' after 
        ``vegetative''.
            (2) In subsection (c) insert ``and mineral material'' after 
        ``vegetative''.
    (e) Conforming Amendment.--Section 1 of the Act of July 31, 1947, 
entitled ``An Act to provide for the disposal of materials on the 
public lands of the United States'' (30 U.S.C. 601 and following) is 
amended by striking ``common varieties of'' in the first sentence.
    (f) Short Titles.--
            (1) Surface resources.--The Act of July 23, 1955, is 
        amended by inserting after section 7 the following new section:
    ``Sec. 8. This Act may be cited as the `Surface Resources Act of 
1955'.''.
            (2) Mineral materials.--The Act of July 31, 1947, entitled 
        ``An Act to provide for the disposal of materials on the public 
        lands of the United States'' (30 U.S.C. 601 and following) is 
        amended by inserting after section 4 the following new section:
    ``Sec. 5. This Act may be cited as the `Materials Act of 1947'.''.
    (g) Repeals.--(1) Subject to valid existing rights, the Act of 
August 4, 1892 (27 Stat. 348, 30 U.S.C. 161), commonly known as the 
Building Stone Act, is hereby repealed.
    (2) Subject to valid existing rights, the Act of January 31, 1901 
(30 U.S.C. 162), commonly known as the Saline Placer Act, is hereby 
repealed.
    (h) Authorization for Disposal of Mineral Materials by Contract.--
Section 2(a) of the Act entitled ``An Act to provide for the disposal 
of materials on the public lands of the United States'', approved July 
31, 1947 (30 U.S.C. 602(a)), is amended--
            (1) by striking the period at the end of paragraph (3) and 
        inserting ``or, if''; and
            (2) by adding after paragraph (3) the following:
            ``(4) the material is a mineral material.''.
    (i) Sodium.--Section 24 of the Mineral Leasing Act (30 U.S.C. 181 
et seq.) is amended by inserting after ``2 per centum'' in each place 
it appears the following: ``and not greater than five and one-half per 
centum''. Any rate under section 24 of the Mineral Leasing Act (30 
U.S.C. 181) in excess of five and one-half per centum shall not be 
allowed unless the following conditions are met:
            (1) the Secretary, in consultation with the Secretary of 
        Commerce and the United States Trade Representative, finds that 
        any increase in the royalty rate for sodium will not have an 
        adverse effect on the export of domestically produced soda ash;
            (2) the Secretary reports this finding of no ``adverse 
        effect'' to Congress and recommends an additional proposed 
        royalty rate increase; and
            (3) the Congress, within 360 days, approves the Secretary's 
        recommendation.
The Secretary shall, within 90 days, offer for competitive bid all 
tracts for which there are applications pending on sodium leases.

SEC. 9505. CLAIM MAINTENANCE REQUIREMENTS.

    (a) Maintenance Fees.--
            (1) Annual maintenance fee.--After the date of enactment of 
        this Act, the owner of each unpatented mining claim or site 
        located pursuant to the general mining laws, whether located 
        before or after the enactment of this Act, shall pay to the 
        Secretary in advance on or before September 1 of each year, 
        until a patent has been issued therefor, an annual maintenance 
        fee per mining claim or site.
            (2) Initial maintenance fee.--The owner of each unpatented 
        mining claim or site located after the date of enactment of 
        this Act pursuant to the general mining laws shall pay to the 
        Secretary, at the time the copy of the notice or certificate of 
        location is filed with the Bureau of Land Management pursuant 
        to section 314(b) of the Federal Land Policy and Management Act 
        of 1976 (43 U.S.C. 1744(b)), the location fee required under 
        subsection (i) of this section, in lieu of the annual 
        maintenance fee of $100 per mining claim or site for the 
        assessment year which includes the date of location of such 
        mining claim or site.
            (3) Exemption.--The owner of any mining claim or site who 
        certifies in writing to the Secretary on or before the first 
        day of any assessment year that access to such mining claim or 
        site was denied or impeded during the prior assessment year by 
        the action or inaction of any local, State, or Federal 
        governmental officer, agency, or court, or by any Indian tribal 
        authority, shall be exempt from the annual maintenance fee 
        requirements of paragraph (1) for the assessment year following 
        the filing of the certification.
            (4) Amount of annual maintenance fee.--For each assessment 
        year the annual maintenance fee payable under paragraph (1) for 
        a claim or site referred to in paragraph (1) shall be in the 
        amount specified in Table 1.
      

                                 TABLE 1                                
------------------------------------------------------------------------
                                                  Amount of Fee Per Site
                Assessment Year                          or Claim       
------------------------------------------------------------------------
1 through 3....................................       $100 per year     
4 through 5....................................       $150 per year     
6 through 10...................................       $200 per year     
11 through 15..................................       $300 per year     
16 and thereafter..............................       $500 per year     
------------------------------------------------------------------------

For purposes of applying Table 1 in the case of claims filed before the 
enactment of this Act, the portion of the assessment year in which this 
Act is enacted shall be treated as the first assessment year.
            (5) Effect of forfeiture.--No owner or co-owner of a mining 
        claim or site which has been forfeited because the maintenance 
        fee has not been paid and no person who is a related person of 
        any such owner or co-owner may relocate a new claim on any part 
        of lands located within the forfeited claim for a period of 18 
        months after the date of forfeiture.
            (6) Deposit of fees.--The full amount of all fees paid 
        under this subsection shall be deposited in the General Fund of 
        the Treasury.
    (b) Annual Labor.--(1) Amounts expended on activities that qualify 
as annual labor under the general mining laws may be credited on a 
dollar for dollar basis towards up to 75 percent of the annual 
maintenance fee payable under this section for the following assessment 
year.
    (2) Subject to the 75 percent limit set forth in paragraph (1), the 
excess of amounts expended for annual labor performed in any one year 
over such 75 percent limit may be applied to the maintenance fee due in 
subsequent years for a period of up to three years.
    (3) In order to receive credit under this subsection for annual 
labor work or excess annual labor, the description and value of the 
work must be included in the statement required in subsection (e) and 
the statement must be timely filed.
    (4) Annual labor performed on an individual mining claim or site 
within a group of contiguous claims may be credited towards the 
aggregate amount of maintenance fees due on all of the contiguous 
claims within that group.
    (c) Work Qualifying as Annual Labor.--(1) Only work which directly 
benefits or develops a mining claim or facilitates the extraction of 
ore qualifies as annual labor. Acceptable labor and improvements 
include any of the following:
            (A) Drilling or excavating, including ore extraction.
            (B) Mining costs directly associated with the production of 
        ore.
            (C) Prospecting work which benefits the location or a 
        contiguous location.
            (D) Development work toward an actual mine, such as shafts, 
        tunnels, crosscuts and drifts, settling ponds and dams.
            (E) Bringing in water for direct mining or milling 
        purposes.
            (F) Clearing of brush, timber, debris, or overburden where 
        necessary to facilitate the extraction or processing of 
        minerals.
            (G) Construction of trails, roads, or landing strips 
        providing access to claims.
            (H) Construction costs of worker housing, mills, and 
        equipment storage buildings where reasonably necessary for the 
        development of the location.
            (I) Reasonable value of the use of equipment for 
        prospecting, mining, or development purposes on the location.
            (J) Repairs of equipment used for prospecting, sampling, or 
        production of minerals provided that such equipment has been on 
        site during the assessment year.
            (K) Cost of moving workers, materials, and equipment among 
        contiguous locations.
            (L) Watchman services of a bona fide employed watchman on 
        the property where reasonably necessary to protect mining 
        equipment of substantial value.
            (M) Activities covered under section 1 of the Act of 
        September 2, 1958 (30 U.S.C. 28-1), as amended.
            (N) Reclamation conducted pursuant to State or Federal 
        surface management regulations.
            (O) Other activities which the Secretary may determine 
        qualify as annual labor.
    (2) The following activities do not qualify as annual labor:
            (A) Work involved in maintaining the location such as 
        brushing and marking boundaries or replacing corner posts and 
        location notices.
            (B) Transportation of workers to or from the location.
            (C) Prospecting or exploration work not conducted within 
        the location or a contiguous location.
    (d) Amendments of Public Law 85-876.--The Act of September 2, 1958 
(Public Law 85-876; 30 U.S.C. 28-1), is amended as follows:
            (1) Section 1 is amended by inserting ``mineral activities, 
        environmental baseline monitoring, and'' after ``without being 
        limited to'' and before ``geological, geochemical and 
        geophysical surveys'' and by striking ``Such'' at the beginning 
        of the last sentence and inserting ``Airborne''.
            (2) Section 2(d) is amended by inserting ``environmental 
        baseline monitoring or'' after ``experience to conduct'' and 
        before ``geological, geochemical or geophysical surveys''.
            (3) Section 2 is amended by adding at the end of the 
        following new subsection at the end thereof:
    ``(e) The term `environmental baseline monitoring' means activities 
for collecting, reviewing and analyzing information concerning soil, 
vegetation, wildlife, mineral, air, water, cultural, historical, 
archaeological or other resources related to planning for or complying 
with Federal and State environmental or permitting requirements 
applicable to potential or proposed mineral activities on the 
claim(s).''.
    (e) Maintenance Fee Statement.--Each payment under subsection (a) 
of this section shall be accompanied by a statement which reasonably 
identifies the mining claim or site for which the maintenance fee is 
being paid. The statement required under this subsection shall be in 
lieu of any annual filing requirements for mining claims or sites, 
under any other Federal law, but shall not supersede any such filing 
requirement under applicable State law.
    (f) Annual Labor Report.--When the value of annual labor is 
credited towards part or all of the maintenance fee, subject to the 75-
percent limit set forth in subsection (b)(1), the following shall 
apply:
            (1) The maintenance fee statement required in subsection 
        (e) must also state the dates of performance of the labor, 
        describe the character and total value of the improvements made 
        or the labor performed, the amount of labor used as a credit 
        toward the maintenance fee for the current year, and the value 
        of excess labor performed in previous years which is to be 
        applied to the maintenance fee for the current year.
            (2) Documentation which reasonably supports the activities 
        or improvements claimed must accompany the maintenance fee 
        statement. Such documentation may include, but is not limited 
        to, copies of maps showing sample locations, drill locations, 
        or survey data; environmental baseline data; reports on 
        geology, geochemistry, or geophysics by qualified experts; 
        drill results; or engineering reports by qualified engineers.
            (3) All supporting material filed pursuant to paragraph (2) 
        shall remain confidential in accordance with section 552 of 
        title 5 of the United States Code as long as the location is 
        maintained and for a period of one year after the location is 
        abandoned, after which all data filed shall be considered 
        public information.
    (g) Effect of Compliance as Against Subsequent Locators.--(1) 
Except as provided in paragraph (2), after the date of enactment of 
this Act, compliance with the requirements of this section shall, from 
the time the location notice or certificate is posted on the land under 
applicable State law, confer upon the owner of any unpatented mining 
claim or site, whether located before or after the date of enactment of 
this Act, an exclusive right of possession, as against subsequent 
locators, of the land included in such mining claim or site under the 
general mining laws. If more than one mining claim or site owned or 
controlled by the same claim or site owner covers substantially the 
same land, by reason of the location of one or more mining claims or 
sites on such land, the amendment or relocation of any such mining 
claim or site, or otherwise, such exclusive right of possession shall 
extend to all such mining claims or sites, effective from the time the 
location notice or certificate for the initial mining claim or site was 
posted on such land under applicable State law. The order of location, 
amendment, or relocation of any such mining claims or sites on such 
land shall not affect the validity of any such mining claim or site. 
Such owner of the mining claim or site shall not be required to be in 
actual, physical occupation of such land and shall not be required to 
exclude rival locators from such land. Such exclusive right of 
possession shall be subject to applicable Federal law, including the 
Multiple Mineral Development Act of 1954 (30 U.S.C. 521-31), the 
Materials Act of 1947 (30 U.S.C. 601-604) and the Surface Resources Act 
of 1955 (30 U.S.C. 611-15) to the extent applicable, and shall neither 
enlarge nor diminish any rights of such owner of the mining claim or 
site as against the United States in such land. This paragraph shall 
supersede the common law doctrine of pedis possessio.
    (2) Conflicts over the right of exclusive possession of land 
included in any mining claim or site shall be determined in proceedings 
between owners of mining claims or sites under the provisions of 
section 910 of the Revised Statutes (30 U.S.C. 53) and other applicable 
law, including but not limited to each of the following:
            (A) Any conflict based upon circumstances existing as of 
        the date of enactment of this Act between mining claims or 
        sites located before the date of enactment of this Act, shall 
        be resolved under the law in effect on the day prior to the 
        date of enactment of this Act, including the common law 
        doctrine of pedis possessio.
            (B) Any conflict arising on or after the date of enactment 
        of this Act between mining claims or sites located before, on 
        or after the date of enactment over whether either owner of the 
        mining claim or site has complied with the requirements of this 
        section, shall be resolved under this Act.
    (h) Failure of Co-Owner To Contribute.--Upon the failure of any one 
or more of several co-owners of any mining claim or site to contribute 
such co-owner or owners' portion of any location or maintenance fee 
payable under this section, any co-owner who has paid such fee may, 
after the payment due date, serve the delinquent co-owner or owners 
with notice of such failure in writing or, if such delinquent co-owner 
or owners cannot be located after reasonable efforts, by publication in 
a general circulation newspaper published in a location nearest the 
mining claim or site at least once a week for at least 90 days. If at 
the expiration of 90 days after such notice in writing or by 
publication, any delinquent co-owner fails or refuses to contribute the 
owed portion, such co-owner or owners' interest shall become the 
property of the owner or co-owners who have paid the required fee.
    (i) Location Fee.--The owner of each unpatented mining claim or 
site located on or after the date of enactment of this Act pursuant to 
the general mining laws shall pay to the Secretary, at the time the 
notice or certificate of location is filed with the Bureau of Land 
Management pursuant to subsection 314(b) of the Federal Land Policy and 
Management Act of 1976 (43 U.S.C. 1744(b)), a location fee of $25.00 
per mining claim or site. The full amount of all fees paid under this 
subsection shall be deposited in the General Fund of the Treasury. 
Effective on the date of the enactment of this Act, section 10102 of 
the Omnibus Budget Reconciliation Act of 1993 (107 Stat. 406; 30 U.S.C. 
28g) is repealed.
    (j) Credit Against Maintenance Fee.--(1) Except as provided in 
paragraph (2), the annual maintenance fee payable for any unpatented 
mining claim or site for any assessment year shall be reduced by the 
amount of royalty paid by such claimholder for such mining claim or 
site, or for any contiguous mining claim or site, during the prior 
assessment year.
    (2) Royalties paid during any assessment year prior to the first 
full assessment year commencing after the enactment of this Act shall 
not reduce the amount of any maintenance fee.
    (k) Oil Shale Claims Subject to Claim Maintenance Fee Under Energy 
Policy Act of 1992.--This section shall not apply to any oil shale 
claims for which a fee is required to be paid under paragraph 
2511(e)(2) of the Energy Policy Act of 1992 (30 U.S.C. 242(e)(2)).
    (l) Failure To Comply.--The failure of the owner of the mining 
claim or site to pay any claim maintenance fee or location fee for a 
mining claim or site on or before the date such payment is due under 
this section shall constitute forfeiture of the mining claim or site 
and such mining claim or site shall be null and void, effective as of 
the day after the date such payment is due, except that if such 
maintenance fee or location fee is paid or tendered on or before the 
30th day after such payment was due under subsection of this section, 
such mining claim or site shall not be forfeited or null or void, and 
such maintenance fee or location fee shall be deemed timely paid.
    (m) Amendment of FLPMA Filing Requirements.--(1) Section 314(a) of 
the Federal Land Policy and Management Act of 1976 (43 U.S.C. 1744(a)) 
is hereby repealed.
    (2) Section 314(c) of the Federal Land Policy and Management Act of 
1976 (43 U.S.C. 1744(c)) is amended to read as follows:
    ``(c) Failure To File as Constituting Forfeiture; Defective or 
Untimely Filing.--The failure to timely file the copy of the notice or 
certificate of location as required by subsection (b) shall constitute 
forfeiture of the mining claim and such claim shall be null and void by 
operation of law; except that it shall not be considered a failure to 
file if the notice or certificate of location is defective or not 
timely filed for record under other State or Federal laws permitting or 
requiring the filing or recording thereof, or if the copy of the notice 
or certificate is filed by or on behalf of some but not all of the 
owners of the claim.''.
    (n) Related Persons.--As used in this section, the term ``related 
persons'' includes--
            (1) the spouse and dependent children (as defined in 
        section 152 of the Internal Revenue Code of 1986), of the owner 
        of the mining claim or site; and
            (2) a person controlled by, controlling, or under common 
        control with the owner of the mining claim or site.
    (o) Repeal.--Section 10101 of the Omnibus Budget Reconciliation Act 
of 1993 (107 Stat. 406; 30 U.S.C. 28g) is repealed, effective with 
respect to assessment year commencing after the enactment of this Act.
    (p) Periodic Review of Fee Structure.--Beginning in the year 2005 
and at 10 year intervals thereafter, the Secretary shall review the 
costs incurred by the Secretary to administer mining claims for 
locatable minerals under the general mining laws and the structure and 
level of maintenance and location fees received by the Secretary with 
respect to such claims. The Secretary shall determine if the revenues 
from such fees is adequate to cover such costs, taking inflation and 
other appropriate factors into account. The Secretary shall submit the 
results of each such review to the Congress, together with such 
legislative recommendations as the Secretary deems appropriate.

                 PART 2--FEDERAL OIL AND GAS ROYALTIES

SEC. 9511. SHORT TITLE.

    This part may be cited as the ``Federal Oil and Gas Royalty 
Simplification and Fairness Act of 1995''.

SEC. 9512. DEFINITIONS.

    (a) In General.--Section 3 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1701 et seq.) is amended--
            (1) by amending paragraph (7) to read as follows:
            ``(7) `lessee' means any person to whom the United States, 
        an Indian tribe, or an Indian allottee issues a lease or any 
        person to whom operating rights have been assigned;''; and
            (2) by striking ``and'' at the end of paragraph (15), by 
        striking the period at the end of paragraph (16) and inserting 
        a semicolon, and by adding at the end the following:
            ``(17) `adjustment' means an amendment to a previously 
        filed report on an obligation, and any additional payment or 
        credit, if any, applicable thereto, to rectify an underpayment 
        or overpayment on a lease;
            ``(18) `administrative proceeding' means any agency process 
        in which a demand, decision or order issued by the Secretary is 
        subject to appeal or has been appealed;
            ``(19) `assessment' means any fee or charge levied or 
        imposed by the Secretary or the United States other than--
                    ``(A) the principal amount of any royalty, minimum 
                royalty, rental, bonus, net profit share or proceed of 
                sale;
                    ``(B) any interest; or
                    ``(C) any civil or criminal penalty;
            ``(20) `commence' means--
                    ``(A) with respect to a judicial proceeding, the 
                service of a complaint, petition, counterclaim, 
                crossclaim, or other pleading seeking affirmative 
                relief or seeking credit or recoupment; or
                    ``(B) with respect to a demand, the receipt by the 
                Secretary or a lessee of the demand;
            ``(21) `credit' means the application of an overpayment (in 
        whole or in part) against an obligation which has become due to 
        discharge, cancel or reduce the obligation;
            ``(22) `demand' means--
                    ``(A) an order to pay issued by the Secretary; or
                    ``(B) a separate written request by a lessee which 
                asserts an obligation due the lessee,
        but does not mean any royalty or production report, or any 
        information contained therein, required by the Secretary;
            ``(23) `obligation' means--
                    ``(A) any duty of the Secretary or the United 
                States--
                            ``(i) to take oil or gas royalty in kind; 
                        or
                            ``(ii) to pay, refund, offset, or credit 
                        monies including but not limited to--
                                    ``(I) the principal amount of any 
                                royalty, minimum royalty, rental, 
                                bonus, net profit share or proceed of 
                                sale; or
                                    ``(II) any interest;
                    ``(B) any duty of a lessee--
                            ``(i) to deliver oil or gas royalty in 
                        kind; or
                            ``(ii) to pay, offset or credit monies 
                        including but not limited to--
                                    ``(I) the principal amount of any 
                                royalty, minimum royalty, rental, 
                                bonus, net profit share or proceed of 
                                sale;
                                    ``(II) any interest;
                                    ``(III) any penalty; or
                                    ``(IV) any assessment,
        which arises from or relates to any lease administered by the 
        Secretary for, or any mineral leasing law related to, the 
        exploration, production and development of oil or gas on 
        Federal lands or the Outer Continental Shelf;
            ``(24) `order to pay' means a written order issued by the 
        Secretary or the United States which--
                    ``(A) asserts a definite and quantified obligation; 
                and
                    ``(B) specifically identifies the obligation by 
                lease, production month and amount of such obligation 
                ordered to be paid, as well as the reason or reasons 
                such obligation is claimed to be due,
        but such term does not include any other communication or 
        action by or on behalf of the Secretary or the United States;
            ``(25) `overpayment' means any payment by a lessee in 
        excess of an amount legally required to be paid on an 
        obligation and includes the portion of any estimated payment 
        for a production month that is in excess of the royalties due 
        for that month;
            ``(26) `payment' means satisfaction, in whole or in part, 
        of an obligation;
            ``(27) `penalty' means a statutorily authorized civil fine 
        levied or imposed by the Secretary or the United States for a 
        violation of this Act, any mineral leasing law, or a term or 
        provision of a lease administered by the Secretary;
            ``(28) `refund' means the return of an overpayment by the 
        Secretary or the United States by the drawing of funds from the 
        United States Treasury;
            ``(29) `State concerned' means, with respect to a lease, a 
        State which receives a portion of royalties under this Act from 
        such lease; and
            ``(30) `underpayment' means any payment or nonpayment by a 
        lessee that is less than the amount legally required to be paid 
        on an obligation.''.
    (b) Lessee Liability.--Section 102(a) of the Federal Oil and Gas 
Royalty Management Act of 1982 (30 U.S.C. 1712(a)) is amended to read 
as follows:
    ``(a) A lessee who is required to make any royalty or other payment 
under a lease or under the mineral leasing laws, shall make such 
payments in the time and manner as may be specified by the Secretary. A 
lessee may designate a person to act on the lessee's behalf and shall 
notify the Secretary in writing of such designation. The person to whom 
the United States issues a lease or the person by whom operating rights 
are currently owned, but not both, shall remain primarily liable for 
its obligations.''.

SEC. 9513. LIMITATION PERIODS.

    (a) In General.--The Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1701 et seq.) is amended by adding after section 114 
the following new section:

``SEC. 115. LIMITATION PERIODS AND AGENCY ACTIONS.

    ``(a) In General.--A judicial proceeding or demand which arises 
from, or relates to an obligation, shall be commenced within six years 
from the date on which the obligation becomes due and if not so 
commenced shall be barred, except as otherwise provided by this 
section.
    ``(b) Obligation Becomes Due.--
            ``(1) In general.--For purposes of this Act, an obligation 
        becomes due when the right to enforce the obligation is fixed.
            ``(2) Royalty obligations.--The right to enforce the 
        royalty obligation for a production month for a lease is fixed 
        for purposes of this Act on the last day of the calendar month 
        following the month in which oil or gas is produced.
            ``(3) Royalty payment.--The right to collect a royalty 
        payment for an obligation for a production month for a lease is 
        fixed for purposes of this Act on the last day of the second 
        calendar month following the month in which gas is produced, to 
        be phased in by the Secretary in a manner which does not have a 
        negative impact on the Federal budget.
    ``(c) Tolling of Limitation Period.--The running of the limitation 
period under subsection (a) shall not be suspended, tolled, extended, 
or enlarged for any obligation for any reason by any action, including 
an action by the Secretary or the United States, other than the 
following:
            ``(1) Tolling agreement.--A written agreement executed 
        during the limitation period between the Secretary and a lessee 
        which tolls the limitation period for the amount of time during 
        which the agreement is in effect.
            ``(2) Subpoena.--The issuance of a subpoena in accordance 
        with the provisions of section 107(c) shall toll the limitation 
        period with respect to the obligation which is the subject of a 
        subpoena only for the period beginning on the date the lessee 
        receives the subpoena and ending on the date on which (A) the 
        lessee has produced such subpoenaed records for the subject 
        obligation, (B) the Secretary receives written notice that the 
        subpoenaed records for the subject obligation are not in 
        existence or are not in the lessee's possession or control, or 
        (C) a court has determined in a final decision that such 
        records are not required to be produced, whichever occurs 
        first.
            ``(3) Fraud or concealment.--Any fraud or concealment by a 
        lessee in an attempt to defeat or evade an obligation in which 
        case the limitation period shall be tolled for the period of 
        such fraud or such concealment.
            ``(4) Tolling request.--A written tolling request from a 
        lessee based upon the lessee's representation that the lessee's 
        entitlement to an overpayment has not been finally determined. 
        The limitation period shall be tolled pursuant to this 
        paragraph from the date the Secretary receives the tolling 
        request until the earlier of the end of the requested period or 
        12 months after the date the Secretary receives the tolling 
        request, but is subject to successive 12-month renewals by the 
        lessee made prior to the expiration of the then applicable 12-
        month period. The tolling request shall be sufficient if it 
        identifies--
                    ``(A) the person who made the potential 
                overpayment;
                    ``(B) the leases and production months involved in 
                the potential overpayment; and
                    ``(C) the reasons the lessee believes that it may 
                later be entitled to a refund of the overpayment.
            ``(5) Order to perform a restructured accounting.--The 
        issuance of a notice under section 107(d)(4) that the lessee 
        has not adequately performed a restructured accounting shall 
        toll the limitation period with respect to the obligation which 
        is the subject of the notice only for the period beginning on 
        the date the lessee receives the notice and ending on the date 
        on which (A) the Secretary receives written notice the 
        accounting or otherrequirement has been performed, or (B) a 
        court has determined in a final decision that the lessee is not 
        required to perform the accounting, whichever occurs first.
    ``(d) Termination of Limitations Period.--The limitations period 
shall be terminated in the event--
            ``(1) the Secretary has notified the lessee in writing that 
        a time period is closed to further audit; or
            ``(2) the Secretary and a lessee have so agreed in writing.
    ``(e) Final Agency Action.--
            ``(1) 3-year period.--The Secretary shall issue a final 
        decision in any administrative proceeding, including any 
        administrative proceedings pending on the date of enactment of 
        the Federal Oil and Gas Royalty Simplification and Fairness Act 
        of 1995, within three years from the date such proceeding was 
        initiated or three years from the date of such enactment, 
        whichever is later. The three-year period may be extended by 
        any period of time agreed upon in writing by the Secretary and 
        the lessee.
            ``(2) Effect of failure to issue decision.--
                    ``(A) In general.--If no such decision has been 
                issued by the Secretary within the three-year period 
                referred to in paragraph (1)--
                            ``(i) the Secretary shall be deemed to have 
                        issued and granted a decision in favor of the 
                        lessee or lessees as to any nonmonetary 
                        obligation and any monetary obligation the 
                        principal amount of which is less than $2,500; 
                        and
                            ``(ii) the Secretary shall be deemed to 
                        have issued a final decision in favor of the 
                        Secretary, which decision shall be deemed to 
                        affirm those issues for which the agency 
                        rendered a decision prior to the end of such 
                        period, as to any monetary obligation the 
                        principal amount of which is $2,500 or more, 
                        and the lessee shall have a right to a de novo 
                        judicial review of such deemed final decision.
                    ``(B) No precedential effect on other 
                proceedings.--Deemed decisions under subparagraph (A) 
                shall have no precedential effect in any judicial or 
                administrative proceeding or for any other purpose.
    ``(f) Administrative Settlement.--During the pendency of any 
administrative proceeding, the parties shall hold at least one 
settlement consultation for the purpose of discussing disputed matters 
between the parties. For purposes of settlement, the Secretary may take 
such action as is appropriate to compromise and settle a disputed 
obligation, including interest and allowing offsetting of obligations 
among leases. The Secretary and the State concerned shall seek to 
resolve disputes with a lessee in as expeditious a manner as possible, 
through settlement negotiations and other alternative dispute 
resolution processes methods. If any dispute involving an obligation 
due is not resolved by the end of the six-year period beginning on the 
date the obligation became due, the amount of interest otherwise 
payable with respect to the obligation shall accrue after such six-year 
period at the rate--
            ``(1) for purposes of section 111(h), reduced each year 
        thereafter by two additional percentage points from the rate in 
        effect under this subsection for the previous year (but not 
        less than zero); and
            ``(2) for purposes of section 111(a), reduced each year 
        thereafter by one additional percentage point from the rate in 
        effect under this subsection for the previous year (but not 
        less than zero).
    ``(g) Limitation on Certain Actions.--When an action on or 
enforcement of an obligation under the mineral leasing laws is barred 
under this section--
            ``(1) no other or further action regarding that obligation, 
        including (but not limited to) the issuance of any order, 
        request, demand or other communication seeking any document, 
        accounting, determination, calculation, recalculation, payment, 
        principal, interest, assessment, or penalty or the initiation, 
        pursuit or completion of an audit with respect to that 
        obligation may be taken; and
            ``(2) no other equitable or legal remedy, whether under 
        statute or common law, with respect to an action on or an 
        enforcement of said obligation may be pursued.
    ``(h) Judicial Review.--In the event a demand subject to this 
section is timely commenced, a judicial proceeding challenging the 
final agency action with respect to such demand shall be deemed timely 
so long as such judicial proceeding is commenced within 180 days from 
receipt of notice by the lessee of the final agency action.
    ``(i) Implementation of Final Decision.--In the event a judicial 
proceeding or demand subject to this section is timely commenced and 
thereafter the limitation period in this section lapses during the 
pendency of such proceeding, any party to such proceeding shall not be 
barred from taking such action as is required or necessary to implement 
a final unappealable judicial or administrative decision, including any 
action required or necessary to implement such decision by the recovery 
or recoupment of an underpayment or overpayment by means of refund or 
credit.
    ``(j) Stay of Payment Obligation Pending Review.--Any party ordered 
by the Secretary or the United States to pay any obligation (other than 
an assessment) shall be entitled to a stay of such payment without bond 
or other surety instrument pending an administrative or judicial 
proceeding if the party periodically demonstrates to the satisfaction 
of the Secretary that such party is financially solvent or otherwise 
able to pay the obligation. In the event the party is not able to so 
demonstrate, the Secretary may require a bond or other surety 
instrument satisfactory to cover the obligation. Any party ordered by 
the Secretary to pay an assessment shall be entitled to a stay without 
bond or other surety instrument.
    ``(k) Inapplicability of the Other Statutes of Limitation.--The 
limitations set forth in sections 2401, 2415, 2416, and 2462 of title 
28, United States Code, section 42 of the Mineral Leasing Act (30 
U.S.C. 226-2) and section 3716 of title 31, United States Code, shall 
not apply to any obligation to which this Act applies.''.
    (b) Subpoena.--Section 107 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1717) is amended by adding at the end 
the following:
    ``(c) Rules Regarding Issuance of Subpoena Relating to Reporting 
and Payment of an Obligation Due.--
            ``(1) In general.--A subpoena which requires a lessee to 
        produce records necessary to determine the proper reporting and 
        payment of an obligation due the Secretary may be issued under 
        this section only by an Assistant Secretary of the Interior and 
        an acting Assistant Secretary of the Interior who is a schedule 
        C employee (as defined by section 213.3301 of title 5, Code of 
        Federal Regulations) and may not be delegated.
            ``(2) Prior written request required.--A subpoena described 
        in paragraph (1) may only be issued against a lessee during the 
        limitation period provided in section 115 and only after the 
        Secretary has in writing requested the records from the lessee 
        related to the obligation which is the subject of the subpoena 
        and has determined that--
                    ``(A) the lessee has failed to respond within a 
                reasonable period of time to the Secretary's written 
                request for such records necessary for an audit, 
                investigation or other inquiry made in accordance with 
                the Secretary's responsibilities under this Act;
                    ``(B) the lessee has in writing denied the 
                Secretary's written request to produce such records in 
                the lessee's possession or control necessary for an 
                audit, investigation or other inquiry made in 
                accordance with the Secretary's responsibilities under 
                this Act; or
                    ``(C) the lessee has unreasonably delayed in 
                producing records necessary for an audit, investigation 
                or other inquiry made in accordance with the 
                Secretary's responsibilities under this Act after the 
                Secretary's written request.
            ``(3) Reasonable period for compliance with written 
        request.--In seeking records, the Secretary shall afford the 
        lessee a reasonable period of time after a written request by 
        the Secretary in which to provide such records prior to the 
        issuance of any subpoena.''.
    (c) Restructured Accounting.--Section 107 of the Federal Oil and 
Gas Royalty Management Act of 1982 (30 U.S.C. 1717), as amended by 
subsection (b) of this section, is amended by adding at the end the 
following:
    ``(d) Restructured Accounting.--
            ``(1) In general.--The Secretary shall issue an order to 
        perform a restructured accounting when the Secretary determines 
        during an in-depth audit of a lessee that the lessee should 
        recalculate royalty due on an obligation based upon the 
        Secretary's finding that the lessee has made identified 
        underpayments or overpayments which are demonstrated by the 
        Secretary to be based upon repeated, systemic reporting errors 
        for a significant number of leases or a single lease for a 
        significant number of reporting months with the same type of 
        error which constitutes a pattern of violations and which are 
        likely to result in either significant underpayments or 
        overpayments.
            ``(2) Delegation.--The power of the Secretary to issue an 
        order to perform a restructured accounting may not be delegated 
        below the most senior career professional position having 
        responsibility for the royalty management program, which 
        position is currently designated as the `Associate Director for 
        Royalty Management'. An order to perform a restructured 
        accounting shall--
                    ``(A) be issued within a reasonable period of time 
                from when the audit identifies the systemic, reporting 
                errors;
                    ``(B) specify the reasons and factual bases for 
                such order; and
                    ``(C) be specifically identified as an `order to 
                perform a restructured accounting'.
            ``(3) Order to perform.--An order to perform a restructured 
        accounting shall not include any other communication or action 
        by or on behalf of the Secretary or the United States.
            ``(4) Notice.--If a lessee fails to adequately perform a 
        restructured accounting pursuant to this subsection, a notice 
        shall be issued to the lessee that the restructured accounting 
        has not been adequately performed. Such notice may be issued 
        under this section only by an Assistant Secretary of the 
        Interior or an acting Assistant Secretary of the Interior who 
        is a schedule C employee (as defined by section 213.3301 of 
        title 5, Code of Federal Regulations) and may not be 
        delegated.''.
    (d) State Suits.--Section 204 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1751) is amended by adding at the end 
the following:
    ``(d) With respect to an obligation, a State bringing an action 
under this section shall enjoy no greater rights than the Secretary 
enjoys under this Act.''.
    (e) Clerical Amendment.--The table of contents in section 1 of such 
Act (30 U.S.C. 1701) is amended by adding after the item relating to 
section 114 the following new item:

``Sec. 115. Limitation periods and agency actions.''.

SEC. 9514. ADJUSTMENT AND REFUNDS.

    (a) In General.--The Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1701 et seq.) is amended by adding after section 111 
the following new section:

``SEC. 111A. ADJUSTMENTS AND REFUNDS.

    ``(a) Adjustments.--
            ``(1) If, during the adjustment period, a lessee determines 
        that an adjustment or refund request is necessary to correct an 
        underpayment or overpayment of an obligation, the lessee shall 
        make such adjustment or request a refund within a reasonable 
        period of time and only during the adjustment period. The 
        filing of a royalty report which reflects the underpayment or 
        overpayment of an obligation shall constitute prior written 
        notice to the Secretary of an adjustment.
            ``(2)(A) For any adjustment, the lessee shall calculate and 
        report the interest due attributable to such adjustment at the 
        same time the lessee adjusts the principal amount of the 
        subject obligation, except as provided by subparagraph (B).
            ``(B) In the case of a lessee on whom the Secretary 
        determines that subparagraph (A) would impose a hardship, the 
        Secretary shall calculate the interest due and notify the 
        lessee within a reasonable time of the amount of interest due, 
        unless such lessee elects to calculate and report interest in 
        accordance with subparagraph (A).
            ``(3) An adjustment or a request for a refund for an 
        obligation may be made after the adjustment period only upon 
        written notice to and approval by the Secretary during an audit 
        of the period which includes the production month for which the 
        adjustment is being made. If an overpayment is identified 
        during an audit, then the Secretary shall allow a credit or 
        refund in the amount of the overpayment.
            ``(4) For purposes of this section, the adjustment period 
        for any obligation shall be the five-year period following the 
        date on which an obligation became due. The adjustment period 
        shall be suspended, tolled, extended, enlarged, or terminated 
        by the same actions as the limitation period in section 115.
    ``(b) Refunds.--
            ``(1) In general.--A request for refund is sufficient if 
        it--
                    ``(A) is made in writing to the Secretary and, for 
                purposes of section 115, is specifically identified as 
                a demand;
                    ``(B) identifies the person entitled to such 
                refund;
                    ``(C) provides the Secretary information that 
                reasonably enables the Secretary to identify the 
                overpayment for which such refund is sought; and
                    ``(D) provides the reasons why the payment was an 
                overpayment.
            ``(2) Payment by secretary of the treasury.--The Secretary 
        shall certify the amount of the refund to be paid under 
        paragraph (1) to the Secretary of the Treasury who shall make 
        such refund. Such refund shall be paid from amounts received as 
        current receipts from sales, bonuses, royalties (including 
        interest charges collected under this section) and rentals of 
        the public lands and the Outer Continental Shelf under the 
        provisions of the Mineral Leasing Act and the Outer Continental 
        Shelf Lands Act, which are not payable to a State or the 
        Reclamation Fund. The portion of any such refund attributable 
        to any amounts previously disbursed to a State, the Reclamation 
        Fund, or any recipient prescribed by law shall be deducted from 
        the next disbursements to that recipient made under the 
        applicable law. Such amounts deducted from subsequent 
        disbursements shall be credited to miscellaneous receipts in 
        the Treasury.
            ``(3) Payment period.--A refund under this subsection shall 
        be paid or denied (with an explanation of the reasons for the 
        denial) within 120 days of the date on which the request for 
        refund is received by the Secretary. Such refund shall be 
        subject to later audit by the Secretary and subject to the 
        provisions of this Act.
            ``(4) Prohibition against reduction of refunds or 
        credits.--In no event shall the Secretary directly or 
        indirectly claim any amount or amounts against, or reduce any 
        refund or credit (or interest accrued thereon) by the amount of 
        any obligation the enforcement of which is barred by section 
        115.''.
    (b) Clerical Amendment.--The table of contents in section 1 of such 
Act (30 U.S.C. 1701) is amended by adding after the item relating to 
section 111 the following new item:

``Sec. 111A. Adjustments and refunds.''.

SEC. 9515. REQUIRED RECORDKEEPING.

    Section 103 of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1713(b)) is amended by adding at the end the following:
    ``(c) Records required by the Secretary for the purpose of 
determining compliance with any applicable mineral leasing law, lease 
provision, regulation or order with respect to oil and gas leases from 
Federal lands or the Outer Continental Shelf shall be maintained for 
the same period of time during which a judicial proceeding or demand 
may be commenced under section 115(a). If a judicial proceeding or 
demand is timely commenced, the record holder shall maintain such 
records until the final nonappealable decision in such judicial 
proceeding is made, or with respect to that demand is rendered, unless 
the Secretary authorizes in writing an earlier release of the 
requirement to maintain such records. Notwithstanding anything herein 
to the contrary, under no circumstance shall a record holder be 
required to maintain or produce any record relating to an obligation 
for any time period which is barred by the applicable limitation in 
section 115.''.

SEC. 9516. ROYALTY INTEREST, PENALTIES, AND PAYMENTS.

    (a) Period.--Section 111(f) of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1721(f)) is amended to read as 
follows:
    ``(f) Upon a determination that it will further the effective and 
efficient performance of his duties and responsibilities, the Secretary 
may waive or forego such interest in whole or in part. Interest shall 
be charged under this section only for the number of days a payment is 
late.''.
    (b) Lessee Interest.--Section 111 of the Federal Oil and Gas 
Royalty Management Act of 1982 (30 U.S.C. 1721) is amended by adding 
after subsection (g) the following:
    ``(h) Interest shall be allowed and the Secretary shall pay or 
credit such interest on any overpayment, with such interest to accrue 
from the date such overpayment was made, at the rate obtained by 
applying the provisions of subparagraphs (A) and (B) of section 
6621(a)(1) of the Internal Revenue Code of 1986. Interest which has 
accrued on any overpayment may be applied to reduce an underpayment. 
This subsection applies to overpayments made later than six months 
after the date of enactment of this subsection or September 1, 1996, 
whichever is later. Such interest shall be paid from amounts received 
as current receipts from sales, bonuses, royalties (including interest 
charges collected under this section) and rentals of the public lands 
and the Outer Continental Shelf under the provisions of the Mineral 
Leasing Act, and the Outer Continental Shelf Lands Act, which are not 
payable to a State or the Reclamation Fund. The portion of any such 
interest payment attributable to any amounts previously disbursed to a 
State, the Reclamation Fund, or any other recipient designated by law 
shall be deducted from the next disbursements to that recipient made 
under the applicable law. Such amounts deducted from subsequent 
disbursements shall be credited to miscellaneous receipts in the 
Treasury.''.
    (c) Limitation on Interest.--Section 111 of such Act, as amended by 
subsection (b) of this Act, is further amended by adding at the end the 
following:
    ``(i) Upon a determination by the Secretary that an excessive 
overpayment (based upon all obligations of a lessee for a given 
reporting month) was made for the sole purpose of receiving interest, 
interest shall not be paid on the excessive amount of such overpayment. 
For purposes of this Act, an `excessive overpayment' shall be the 
amount that any overpayment a lessee pays for a given reporting month 
(excluding payments for demands for obligations as a result of judicial 
or administrative proceedings for settlement agreements and for other 
similar payments) for the aggregate of all of its Federal leases 
exceeds 25 percent of the total royalties paid that month for those 
leases.''.
    (d) Estimated Payment.--Section 111 of such Act, as amended by 
subsections (b) and (c) of this Act, is further amended by adding at 
the end the following:
    ``(j) A lessee may make a payment for the approximate amount of 
royalties (hereinafter in this subsection `estimated payment') that 
would otherwise be due to the Secretary for such lease to avoid 
underpayment or nonpayment interest charges. When an estimated payment 
is made, actual royalties become due at the end of the month following 
the period covered by the estimated payment. If the lessee makes a 
payment for such actual royalties, the lessee may apply the estimated 
payment to future royalties. Any estimated payment may be adjusted, 
recouped, or reinstated at any time by the lessee.''.
    (e) Volume Allocation of Oil and Gas Production.--Section 111 of 
such Act (30 U.S.C. 1721), as amended by subsections (b) through (d) of 
this Act, is amended by adding at the end the following:
    ``(k)(1) Except as otherwise provided by this subsection--
            ``(A) a lessee of a lease in a unit or communitization 
        agreement which contains only Federal leases with the same 
        royalty rate and funds distribution must report and pay 
        royalties on oil and gas production for each production month 
        based on the actual volume of production sold by or on behalf 
        of that lessee;
            ``(B) a lessee of a lease in any other unit or 
        communitization agreement must report and pay royalties on oil 
        and gas production for each production month based on the 
        volume of oil and gas produced from such agreement and 
        allocated to the lease in accordance with the terms of the 
        agreement; and
            ``(C) a lessee of a lease that is not contained in a unit 
        or communitization agreement must report and pay royalties on 
        oil and gas production for each production month based on the 
        actual volume of production sold by or on behalf of that 
        lessee.
    ``(2) This subsection applies only to requirements for reporting 
and paying royalties. Nothing in this subsection is intended to alter a 
lessee's liability for royalties on oil or gas production based on the 
share of production allocated to the lease in accordance with the terms 
of the lease, a unit or communitization agreement, or any other 
agreement.
    ``(3) For any unit or communitization agreement, if all lessees 
contractually agree to an alternative method of royalty reporting and 
payment, the lessees may submit such alternative method to the 
Secretary for approval and make payments in accordance with such 
approved alternative method so long as such alternative method does not 
reduce the amount of the royalty obligation.
    ``(4) The Secretary shall grant an exception from the reporting and 
payment requirements for marginal properties by allowing for any 
calendar year or portion thereof royalties to be paid each month based 
on the volume of production sold. Interest shall not accrue on the 
difference for the entire calendar year or portion thereof between the 
amount of oil and gas actually sold and the share of production 
allocated to the lease until the beginning of the month following 
calendar year or portion thereof. Any additional royalties due or 
overpaid royalties and associated interest shall be paid, refunded, or 
credited within six months after the end of each calendar year in which 
royalties are paid based on volumes of production sold. For the purpose 
of this subsection, the term `marginal property' means a lease that 
produces on average the combined equivalent of less than 15 barrels of 
oil per day or 90 thousand cubic feet of gas per day, or a combination 
thereof, determined by dividing the average daily production of 
domestic crude oil and domestic natural gas from producing wells on 
such lease by the number of such wells, unless the Secretary, together 
with the State concerned, determines that a different production is 
more appropriate.
    ``(5) Not later than two years after the date of the enactment of 
this subsection, the Secretary shall issue any appropriate demand for 
all outstanding royalty payment disputes regarding who is required to 
report and pay royalties on production from units and communitization 
agreements outstanding on the date of the enactment of this subsection, 
and collect royalty amounts owed on such production.''.
    (f) Production Allocation.--Section 111 of such Act (30 U.S.C. 
1721), as amended by subsections (b) through (e) of this Act, is 
amended by adding at the end the following:
    ``(l) The Secretary shall issue all determinations of allocations 
of production for units and communitization agreements within 120 days 
of a request for determination. If the Secretary fails to issue a 
determination within such 120-day period, the Secretary shall waive 
interest due on obligations subject to the determination until the end 
of the month following the month in which the determination is made.''.

SEC. 9517. LIMITATION ON ASSESSMENTS.

    Section 111 of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1721), as amended by section 9516, is further amended 
by adding at the end the following:
    ``(m)(1) After the date of enactment of this subsection, the 
Secretary shall not impose any assessment for any late payment or 
underpayment. After the date of enactment of this subsection, the 
Secretary may impose an assessment only for erroneous reports submitted 
by lessees subject to the limitations of paragraph (2). Nothing in this 
section shall prohibit the Secretary from imposing penalties or 
interest under other sections of this Act for late payments or 
underpayments.
    ``(2) No assessment for erroneous reports shall be imposed for 18 
months following the date of enactment of this subsection, or until the 
Secretary issues a final rule which provides for imposition of an 
assessment only on a lessee who chronically submits erroneous reports 
and which establishes what constitutes chronic errors for a lessee, 
whichever is later. However, if the Secretary determines during that 
18-month period that the reporting error rate for all reporters for all 
Federal leases has increased by one-third for three consecutive report 
months for either production reporting or royalty reporting over the 12 
months preceding the date of enactment of this subsection, the 
Secretary may impose an assessment for erroneous reports only for the 
increased category of report under regulations in effect on the date of 
enactment of this subsection.''.

SEC. 9518. ALTERNATIVES FOR MARGINAL PROPERTIES.

    (a) In General.--The Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1701 et seq.), as amended by section 9513 of this Act, 
is further amended by adding at the end the following:

``SEC. 116. ALTERNATIVES FOR MARGINAL PROPERTIES.

    ``(a) Selling the Revenue Stream.--
            ``(1) In general.--Notwithstanding the provisions of any 
        lease to the contrary, upon request of the lessee or a State 
        under section 205(g), the Secretary shall authorize a lessee 
        for a marginal property and for a lease, the administration of 
        which is not cost-effective for the Secretary to administer, to 
        make a prepayment in lieu of royalty payments under the lease 
        for the remainder of the lease term. For the purposes of this 
        section, the term `marginal property' has the same meaning 
        given such term in section 111(k)(4), unless the Secretary, 
        together with each State in which such marginal production 
        occurs, determines that a different definition of marginal 
        property better achieves the purpose of this section.
            ``(2) Marginal properties.--For marginal properties, 
        prepayments under paragraph (1) shall begin--
                    ``(A) in the case of those properties producing on 
                average $500 or less per month in total royalties to 
                the United States, two years after the date of the 
                enactment of this section;
                    ``(B) in the case of those properties producing on 
                average more than $500 but $1,000 or less per month in 
                total royalties to the United States, three years after 
                the date of the enactment of this section;
                    ``(C) in the case of those properties producing on 
                average more than $1,000 but $1,500 or less per month 
                in total royalties to the United States, four years 
                after the date of the enactment of this section; and
                    ``(D) in the case of those properties not described 
                in subparagraphs (A) through (C), five years after the 
                date of the enactment of this section.
            ``(3) Administration not cost-effective.--For a lease, the 
        administration of which is not cost-effective for the Secretary 
        to administer, prepayments under paragraph (1) shall begin on 
        the date of the enactment of this section.
            ``(4) Satisfaction of royalty obligation.--A lessee who 
        makes a prepayment under this section shall have satisfied in 
        full its obligation to pay royalty on production from the lease 
        or a portion of a lease and shall not be required to submit any 
        royalty reports to the Secretary. The prepayment shall be 
        shared by the Secretary with any State or other recipient to 
        the same extent as any royalty payment for such lease.
            ``(5) Valuation.--The prepayment authorized under this 
        section shall only occur if the Secretary, the State concerned, 
        and the lessee determine that such prepayment is based on the 
        present value of the projected remaining royalties from the 
        production from the lease, based on appropriate nominal 
        discount rate for a comparable term. Prior to accepting such 
        prepayment, the Secretary and State concerned shall agree that 
        such prepayment is in the best interest of the United States 
        and the State concerned.
    ``(b) Alternative Accounting and Auditing Requirements.--
            ``(1) In general.--Within one year after the date of the 
        enactment of this section, for the marginal properties 
        referenced in subsection (a)(1), the Secretary shall provide 
        accounting, reporting, and auditing relief that will encourage 
        lessees to continue to produce and develop such properties: 
        Provided, That such relief will only be available to lessees in 
        a State that concurs. Prior to granting such relief, the 
        Secretary and the State concerned shall agree that the type of 
        marginal wells and relief provided under this paragraph is in 
        the best interest of the United States and the State concerned.
            ``(2) Payment date.--For leases subject to this section, 
        the Secretary may allow royalties to be paid later than the 
        time specified in the lease.''.
    (b) Clerical Amendment.--The table of contents in section 1 of such 
Act (30 U.S.C. 1701) is amended by adding after the item relating to 
section 115 the following new item:

``Sec. 116. Alternatives for marginal properties.''.

SEC. 9519. ROYALTY IN KIND.

    (a) In General.--
            (1) OCS.--Section 27(a)(1) of the Outer Continental Shelf 
        Lands Act (43 U.S.C. 1353(a)(1)) is amended by adding at the 
        end the following:
``Any royalty or net profit share of oil or gas accruing to the United 
States under any such lease, at the Secretary's option, may be taken in 
kind at or near the lease (unless the lease expressly provides for 
delivery at a different location) upon prior written notice given 
reasonably in advance by the Secretary to the lessee. Once the United 
States has commenced taking royalty in kind, it shall continue to do so 
until a reasonable time after the Secretary has provided written notice 
reasonably in advance to the lessee that it will resume taking royalty 
in value. Delivery of royalty in kind by the lessee shall satisfy in 
full the lessee's royalty obligation. Once the oil or gas is delivered, 
the lessee shall not be subject to the reporting and recordkeeping 
requirements under section 103 for its share of oil and gas production 
other than records necessary to verify the quantity of oil or gas 
delivered.''.
            (2) Onshore.--Section 36 of the Mineral Leasing Act (30 
        U.S.C. 192) is amended by adding at the end the following 
        undesignated paragraph:
    ``Notwithstanding the provisions of the previous paragraph, any 
royalty or net profit share of oil or gas accruing to the United States 
under any lease issued or maintained by the Secretary for the 
exploration, production and development of oil and gas on Federal 
lands, at the Secretary's option, may be taken in kind at or near the 
lease (unless the lease expressly provides for delivery at a different 
location) after prior written notice given reasonably in advance by the 
Secretary to the lessee. Once the United States has commenced taking 
royalty in kind, it shall continue to do so until a reasonable time 
after the Secretary has provided written notice reasonably in advance 
to the lessee that it will resume taking royalty in value. Delivery of 
royalty in kind by the lessee shall satisfy in full the lessee's 
royalty obligation. Once the oil or gas is delivered, the lessee shall 
not be subject to the reporting and recordkeeping requirements under 
section 103 for its share of oil and gas production other than records 
necessary to verify the quantity of oil or gas delivered.''.
    (b) Sale.--Sections 27(b)(1) and (c)(1) of the Outer Continental 
Shelf Lands Act (43 U.S.C. 1353(c)(1)) are each amended by striking 
``competitive bidding for not more than its regulated price, or, if no 
regulated price applies, not less than its fair market value'' and 
inserting ``competitive bidding or private sale''.

SEC. 9520. ROYALTY SIMPLIFICATION AND COST-EFFECTIVE AUDIT AND 
                    COLLECTION REQUIREMENTS.

    (a) In General.--Section 101 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1711) is amended by adding at the end 
the following:
    ``(d)(1) For the purpose of reducing costs and increasing net 
royalties to the United States and the States, the Secretary, in 
consultation with States concerned, shall, within one year after the 
date of the enactment of this subsection, streamline and simplify 
current royalty management requirements and practices, including 
royalty reporting, instructions, audits and collections. This 
streamlining and simplification shall specifically include--
            ``(A) elimination of all unnecessary royalty and production 
        reports;
            ``(B) modification and simplification of remaining reports 
        and associated instructions to eliminate redundant or 
        unnecessary reports and information that are provided or can be 
        obtained from other required reports, forms, computer databases 
        or government agencies;
            ``(C) elimination or modifications of accounting, 
        reporting, audit and collection requirements that are not cost-
        effective, particularly those associated with de minimis 
        monetary amounts;
            ``(D) implementation of specific recommendations and 
        comments contained in Secretarial sponsored teams, rulemakings, 
        and studies or those participated in by the Secretary to the 
        extent these recommendations simplify and streamline royalty 
        management requirements without adversely affecting the 
        Secretary's ability to meet obligations under this Act or other 
        mineral leasing statutes;
            ``(E) recommendations and comments submitted by interested 
        parties to the extent these recommendations and comments 
        simplify and streamline royalty management requirements without 
        adversely affecting the Secretary's ability to meet obligations 
        under this Act or other mineral leasing statutes.
    ``(2) The Secretary shall submit to the Congress a progress report 
on the implementation of this section within six months from date of 
enactment of this Act, and a final report within 12 months from date of 
enactment of this Act. These reports shall include--
            ``(A) a description of the extent to which the Secretary 
        has implemented the requirements in paragraph (1), including a 
        list of specific initiatives implemented;
            ``(B) a list and description of additional initiatives 
        identified by the Secretary to simplify and streamline royalty 
        management requirements and practices; and
            ``(C) cost savings of implemented initiatives including 
        impact on net-receipts sharing for States.
    ``(3) If the Secretary and the State concerned determines that the 
cost of accounting and auditing for and collecting of any obligation 
due for any oil and gas production exceeds the amount of the obligation 
to be collected, the Secretary shall waive such obligation.
    ``(4) The Secretary and the State concerned shall not perform 
accounting, reporting, or audit activities if the Secretary and the 
State concerned determines that the cost of conducting the activity 
exceeds the expected amount to be collected by the activity.
    ``(5) The Secretary and the State concerned shall develop a 
reporting and audit strategy which eliminates multiple or redundant 
reporting of information.''.
    (b) Paperwork Reduction.--Section 107 of the Federal Oil and Gas 
Royalty Management Act of 1982 (30 U.S.C. 1717), as amended by section 
9513(b) and (c), is amended by adding at the end the following:
    ``(e) Paperwork Reduction.--Administrative actions and 
investigations (including, but not limited to, accounting collection 
and audits) under this Act involving obligations shall be subject to 
section 3518(c)(1)(B) of title 44, United States Code.''.

SEC. 9521. REPEALS.

    (a) FOGRMA.--Section 307 of the Federal Oil and Gas Royalty 
Management Act of 1982 (30 U.S.C. 1755), is repealed. Section 1 of such 
Act (relating to the table of contents) is amended by striking out the 
item relating to section 307.
    (b) OCSLA.--Effective on the date of the enactment of this Act, 
section 10 of the Outer Continental Shelf Lands Act (43 U.S.C. 1339) is 
repealed.

SEC. 9522. DELEGATION TO STATES.

    (a) General Authority.--Section 205(a) of the Federal Oil and Gas 
Royalty Management Act of 1982 (30 U.S.C. 1735(a)) is amended to read 
as follows:
    ``(a) Upon written request of any State, the Secretary is 
authorized to delegate, in accordance with the provisions of this 
section, all or part of the authorities and responsibilities of the 
Secretary under this Act to conduct inspections, such production and 
royalty accounting duties and responsibilities as the Secretary 
determines are legally delegable, all audit coverage, and 
investigations to any State with respect to all Federal lands within 
the State.''.
    (b) Standardized Reporting.--Section 205(b) of such Act (30 U.S.C. 
1735(b)) is amended--
            (1) by striking ``and'' at the end of paragraph (2);
            (2) by striking the comma at the end of paragraph (3) and 
        inserting ``; and''; and
            (3) by inserting after paragraph (3) the following:
            ``(4) the State agrees to adopt Federal standardized 
        reporting for Federal royalty accounting and collection 
        purposes,''.
    (c) Cost Effective Collection of De Minimis Royalty Amounts.--
Section 205 of such Act (30 U.S.C. 1735) is amended by adding at the 
end the following:
    ``(g) Upon written request of any State, the Secretary is 
authorized to delegate for any year the responsibility to collect 
royalties from all Federal leases within the State if the average 
amount per year of mineral revenues received by the State on all such 
leases under all Federal mineral leasing laws for the previous five 
years is less than $100,000. The State may also request that the 
Secretary sell the revenue stream from all or part of the Federal 
leases within the State in accordance with section 116 of the Federal 
Oil and Gas Royalty Management Act of 1982, as added by section 9518 of 
the Federal Oil and Gas Royalty Simplification and Fairness Act of 
1995.''.

SEC. 9523. PERFORMANCE STANDARD.

    Section 109 of the Federal Oil and Gas Royalty Management Act of 
1982 (30 U.S.C. 1719) is amended in subsections (c) and (d), by 
striking ``knowingly or willfully'' and inserting ``by willful 
misconduct or gross negligence'' each place it appears.

SEC. 9524. INDIAN LANDS.

    The amendments made by this part shall not apply with respect to 
Indian lands, and the provisions of the Federal Oil and Gas Royalty 
Management Act of 1982 as in effect on the day before the date of 
enactment of this Act shall continue to apply after such date with 
respect to Indian lands.

SEC. 9525. PRIVATE LANDS.

    This part shall not apply to any privately owned minerals.

SEC. 9526. EFFECTIVE DATE.

    Except as provided by section 115(e), section 111(h), section 
111(k)(5), and section 116 of the Federal Oil and Gas Royalty 
Management Act of 1982 (as added by this part), this part, and the 
amendments made by this part, shall apply with respect to the 
production of oil and gas after the first day of the month following 
the date of the enactment of this Act.

                  Subtitle F--Indian Gaming and Health

                         PART 1--INDIAN GAMING

SEC. 9601. INDIAN GAMING.

    (a) Commission Funding.--Section 18(a) of the Indian Gaming 
Regulatory Act (25 U.S.C. 2717(a)) is amended by striking out 
``$1,500,000'' each place it appears and inserting in lieu thereof 
``$2,500,000''.
    (b) Authorization of Appropriations.--Section 19(a) of the Indian 
Gaming Regulatory Act (25 U.S.C. 2718(a)) is amended by striking out 
all after ``(a)'' and inserting in lieu thereof the following: 
``Notwithstanding the provisions of section 18, no funds may be 
authorized to be appropriated for the operation of the Commission.''.

                    PART 2--INDIAN HEALTH: MEDICAID

SEC. 9611. HEALTH CARE FACILITIES.

    (a) Treatment of Payments.--Section 402 of the Indian Health Care 
Improvement Act (25 U.S.C. 1642) is amended--
            (1) in the first sentence of subsection (a), by inserting 
        ``, Indian Tribe, tribal organization, or urban Indian 
        organization'' after ``Service'' each place it appears; and
            (2) in the second sentence of subsection (a), by inserting 
        ``, Indian Tribe, tribal organization, or urban Indian 
        organization'' after ``facilities of the Service''.
    (b) Eligibility for Reimbursement.--Section 1911 of the Social 
Security Act (42 U.S.C. 1396j) is amended in subsection (a), by 
inserting ``, Indian Tribe, tribal organization, or urban Indian 
organization'' after ``Indian Health Service''.

SEC. 9612. PROVIDER REIMBURSEMENT.

    Section 402 of the Indian Health Care Improvement Act (25 U.S.C. 
1642) is amended by adding the following new subsections:
    ``(c) Notwithstanding any other provision of law, a health program 
of the Indian Health Service, an Indian tribe, tribal organization, or 
urban Indian organization, that is eligible for reimbursement for 
medical assistance under title XIX of the Social Security Act shall be 
eligible to participate in, and receive reimbursement for medical 
assistance provided to individuals served under any State plan 
authorized under any law which succeeds such title XIX on the same 
basis as any other health care provider in the State in which the 
health program of the Indian Health Service, an Indian tribe, tribal 
organization, or urban Indian organization is operated.
    ``(d) Nothing in this section, or any other law, shall prevent an 
Indian eligible for services through an Indian health program from 
participating in any State plan authorized under any law which succeeds 
such title XIX.
    ``(e) Nothing in this section, or any other law, shall authorize a 
State to deny or limit payments to any provider for medical assistance 
for items or services to Indians.
    ``(f) Any State that authorizes a health plan under any law which 
succeeds such title XIX or applies for a waiver under section 1115 of 
title XIX of the Social Security Act shall consult with the Indian 
tribes located within the State in the development of the health plan's 
standards.''.

SEC. 9613. STUDY.

    The Secretary of Health and Human Services shall conduct a 
comprehensive study of the number of Indians eligible to receive 
services under title XIX of the Social Security Act, the number of 
Indians actually receiving such services, and the effect upon Indians 
of eliminating the entitlement status of title XIX and transferring 
funding under that title to the States, and shall provide 
recommendations for the improvement of such services to eligible 
Indians. The Secretary shall submit the report to Congress no later 
than June 1, 1996.

                    PART 3--INDIAN HEALTH: MEDICARE

SEC. 9621. HEALTH CARE FACILITIES.

    (a) Tribal Facilities.--Section 401(a) of the Indian Health Care 
Improvement Act (25 U.S.C 1641(a)) is amended by striking ``a hospital 
or skilled nursing facility of the Service (whether operated by the 
Service or by an Indian tribe or tribal organization pursuant to a 
contract under the Indian Self-Determination Act)'' and inserting 
``facility of the Service, Indian tribe, tribal organization, or urban 
Indian organization''.
    (b) Eligibility for Reimbursement.--Section 1880(a) of the Social 
Security Act (42 U.S.C. 1395qq) is amended--
            (1) by striking ``hospital or skilled nursing'';
            (2) by inserting ``, Indian Tribe, tribal organization, or 
        urban Indian organization'' after ``Indian Health Service''; 
        and
            (3) by striking ``generally to hospitals or skilled nursing 
        facilities (as the case may be)''.

SEC. 9622. PROVIDER REIMBURSEMENT.

    Section 401 of the Indian Health Care Improvement Act (25 U.S.C. 
1641) is amended by adding the following new subsection:
    ``(c) Notwithstanding any other provision of law, a health program 
of the Indian Health Service, an Indian tribe, tribal organization, or 
urban Indian organization, that is eligible for reimbursement for 
medical assistance under title XVIII of the Social Security Act shall 
be eligible to participate in, and receive reimbursement for medical 
assistance provided to individuals served under any plan offered under 
the Medicare Plus plan on the same basis as any other health care 
provider in the State in which the health program of the Indian Health 
Service, an Indian tribe, tribal organization, or urban Indian 
organization is operated.''.

                        Subtitle G--Consultation

SEC. 9701. CONSULTATION.

    Section 7(d) of the Endangered Species Act of 1973 (16 U.S.C. 
1536(d)) is amended to read as follows:
    ``(d) Limitation on Commitment of Resources.--After initiation of 
consultation required under subsection (a)(2) of this section, the 
Federal agency and the permit or license applicant shall not make any 
irreversible or irretrievable commitment of resources with respect to 
the agency action which has the effect of foreclosing the formulation 
or implementation of any reasonable and prudent alternative measures 
which would not violate subsection (a)(2) of this section. This 
limitation on the commitment of resources is only applicable to 
consultations regarding site-specific projects and activities, and 
shall not apply to any consultation regarding an agency's periodic or 
long-term planning activities, mission or policy statements, 
programmatic documents, or general policies, regulations, or 
activities, whether or not such consultation has previously been 
initiated pursuant to a court order, and regardless of the date on 
which consultation was ordered or initiated.''.

                          Subtitle H--Mapping

SEC. 9801. SHORT TITLE.

    This subtitle may be cited as the ``Department of the Interior 
Surveying and Mapping Efficiency and Economic Opportunity Act of 
1995''.

SEC. 9802. SURVEYING AND MAPPING CONTRACTING PROGRAM.

    In order to provide private firms, including small and small 
disadvantaged businesses, ample opportunities to provide quality 
services to the Department of the Interior (hereinafter referred to as 
the ``Department''), the Secretary of the Interior (hereinafter 
referred to as the ``Secretary'') shall conduct a surveying and mapping 
contracting program.

SEC. 9803. INVENTORY OF ACTIVITIES.

    (a) Publication of Inventory.--Not later than 90 days after the 
date of enactment of this Act, the Secretary, in consultation with the 
Administrator of the Office of Federal Procurement Policy, the 
Administrator of the Small Business Administration and the trade 
association of private surveying and mapping firms, shall publish an 
inventory of surveying and mapping activities in the Department of the 
Interior for the last fiscal year completed prior to the date of 
enactment of this Act.
    (b) Items Included.--The inventory shall include each of the 
following:
            (1) The total dollar value of surveying and mapping 
        activities in each agency of the Department.
            (2) The total dollar value of surveying and mapping 
        activities in each agency of the Department performed by 
        contract with private sector firms.
            (3) The total dollar value of surveying and mapping 
        activities in each agency of the Department performed by 
        personnel of the Department.
            (4) The total dollar value of surveying and mapping 
        activities in each agency of the Department performed for any 
        other department or agency of the Federal Government.
            (5) The total dollar value of surveying and mapping 
        activities in each agency of the Department performed for any 
        State or political subdivision thereof, or for any foreign 
        government.
            (6) The total number of personnel involved in surveying and 
        mapping activities in each agency of the Department.

SEC. 9804. PLAN TO INCREASE USE OF CONTRACTS.

    (a) Establishment.--Based on the inventory conducted pursuant to 
section 9803 of this Act, not later than 180 days after the date of 
enactment of this Act, the Secretary, in consultation with the 
Administrator of the Office of Federal Procurement Policy, the 
Administrator of the Small Business Administration and the trade 
association of private surveying and mapping firms, shall develop and 
implement a plan to increase the use of contracts with private firms 
for surveying and mapping services.
    (b) Items Included in Plan.--The plan established pursuant to 
subsection (a) of this section shall include, but not be limited to 
each of the following:
            (1) A reduction of surveying and mapping activities by 
        personnel in the Department that duplicate capabilities 
        available by contract from the private sector.
            (2) A reduction of acquisition and maintenance of surveying 
        and mapping equipment that duplicate capabilities and capital 
        investment already made by the private sector.
            (3) The elimination of unfair Government competition in 
        activities in which the Department uses its personnel to 
        perform surveying and mapping for which it shares the cost 
        with, is reimbursed for, or makes a grant to any other agency 
        of the Federal Government, a State or political subdivision 
        thereof, or a foreign government, for such activities, when 
        such activities can be obtained by contract from the private 
        sector.
            (4) The use of contracts to perform surveying and mapping 
        requirements of the Department created through attrition.
            (5) The enhancement of the leadership role of the 
        Department of the Interior in--
                    (A) the preparation of standards and 
                specifications;
                    (B) research in surveying and mapping 
                instrumentation and procedures, and the prompt transfer 
                of technology to the private sector;
                    (C) providing technical guidance, coordination, 
                cost sharing, cooperative efforts and administration in 
                the use of Federal funds for surveying and mapping 
                activities, and the development of geographic 
                information systems, that are performed by the private 
                sector by the contract to Federal, State, and local 
                government agencies;
                    (D) establishing a schedule with quantifiable goals 
                for increasing the use of contracts with private sector 
                for current and future surveying and mapping 
                activities; and
                    (E) using Department personnel to perform only 
                those surveying and mapping activities that are 
                inherently governmental in nature, necessary to keep 
                current the skills of such personnel for evaluating 
                contractor performance and administering contracts, and 
                to perform basic research.

SEC. 9805. REPORTS.

    The Secretary shall transmit to the Committee on Resources of the 
House of Representatives and the Committee on Energy and Natural 
Resources of the Senate a report on implementation of the program not 
later than January 15 of each year.

SEC. 9806. DEFINITIONS.

    As used in this subtitle:
            (1) The term ``surveying and mapping'' means collecting, 
        storing, retrieving, or disseminating graphical or digital data 
        depicting natural or man-made physical features, phenomena and 
        boundaries of the earth and any information related thereto, 
        including but not limited to data shown on or in relation to 
        surveys, maps, and charts.
            (2) The ``contract'' means an instrument to retain private 
        firms with licensed, certified, or otherwise qualified 
        professionals in such fields as surveying, photogrammetry, 
        cartography, and geodesy, which shall be awarded in accordance 
        with the selection procedures in title IX of the Federal 
        Property and Administrative Services Act of 1949 (40 U.S.C. 541 
        and following).

                Subtitle I--National Park System Reform

SEC. 9901. SHORT TITLE.

    This subtitle may be cited as the ``National Park System Reform Act 
of 1995''.

SEC. 9902. DEFINITIONS.

    As used in this subtitle:
            (1) The term ``Secretary'' means the Secretary of the 
        Interior.
            (2) The term ``Plan'' means the National Park System Plan 
        developed under section 101.
            (3) The term ``Commission'' means the National Park System 
        Review Commission established pursuant to section 103.
            (4) The term ``Congressional resources committees'' means 
        the Committee on Resources of the House of Representatives and 
        the Committee on Energy and Natural Resources of the Senate.

                   PART 1--NATIONAL PARK SYSTEM PLAN

SEC. 9911. PREPARATION OF NATIONAL PARK SYSTEM PLAN.

    (a) Preparation of Plan.--The Secretary of the Interior, acting 
through the Director of the National Park Service, shall prepare a 
National Park System Plan to guide the direction of the National Park 
System into the next century. The Plan shall include each of the 
following:
            (1) Identification of goals and objectives for use in 
        defining the mission and role of the National Park Service and 
        the National Park System in preserving our Nation's heritage, 
        relative to other efforts at the Federal, State, local, and 
        private levels. This statement shall include a refinement for 
        the definition of ``nationally significant'' for purposes of 
        inclusion in the National Park System.
            (2) Criteria to be used in determining which themes and 
        types of resources are appropriate for representation in the 
        National Park System, as well as criteria for judging 
        individual sites, areas, and themes that are appropriate for 
        inclusion as units of the National Park System.
            (3) Identification of what constitutes adequate 
        representation of a particular resource type or theme in the 
        National Park System.
            (4) Identification of which aspects of the Nation's 
        heritage are adequately represented in the existing National 
        Park System.
            (5) Identification of appropriate aspects of the Nation's 
        heritage not currently or adequately represented in the 
        National Park System.
            (6) Priorities of the themes and types of resources which 
        should be added to the National Park System in order to provide 
        more complete representation of our Nation's heritage.
            (7) A thorough analysis of the role of the National Park 
        System and the National Park Service with respect to (but not 
        limited to) conservation of natural areas and ecosystems; 
        preservation of industrial America; preservation of intangible 
        cultural heritage such as arts, music, and folklife; 
        presidential sites; open space protection; and provision of 
        outdoor recreation opportunities.
            (8) A comprehensive financial management plan for the 
        National Park System which identifies all funding available to 
        the agency, how funds will be allocated to support various 
        programs, and the level of service to be provided.
    (b) Public Participation and Consultation.--During the preparation 
of the Plan under subsection (a), the Secretary shall ensure broad 
public participation in a manner which, at a minimum, consists of the 
following two elements:
            (1) Solicitation of the views of the American public with 
        regard to the future of the National Park System. Opportunities 
        for public participation shall be made available throughout the 
        planning process and shall include specific regional public 
        meetings.
            (2) Consultation with other Federal land management 
        agencies, State and local officials, resource management, 
        recreation and scholarly organizations, and other interested 
        parties as the Secretary deems advisable.
    (c) Transmittal of Report.--Prior to the end of the second complete 
fiscal year commencing after the date of enactment of this Act, the 
Secretary shall transmit the Plan developed under this section to the 
Congressional resources committees.
    (d) Congressional Approval.--Unless Congress enacts a joint 
resolution rejecting all or modifying part of the Plan within 180 
calendar days after the date of its transmittal to Congress, the Plan 
shall be deemed approved.
    (e) Identification of Units of the National Park System.--The 
Secretary shall submit to the Congressional resources committees an 
official list of areas or units of the National Park System within 180 
days after the date of the enactment of this Act. The Secretary shall 
establish a set of criteria for the purpose of developing such list and 
shall transmit those criteria to the Congressional resources 
committees.
    (f) Authority To Establish Units of the National Park System.--
After the enactment of this Act, units or areas of the National Park 
System may only be established pursuant to an Act of Congress or by 
Presidential action in accordance with the Act entitled ``An Act for 
the preservation of American antiquities'' (16 U.S.C. 431 et seq.).

SEC. 9912. MANAGEMENT REVIEW OF NATIONAL PARK SYSTEM.

    (a) Selection Criteria.--(1) The Secretary shall, not later than 45 
days after transmittal of the Plan under section 9911(c), publish in 
the Federal Register and transmit to the Congressional resources 
committees the criteria proposed to be used by the Department of the 
Interior in reviewing existing units of the National Park System under 
this section. The Secretary shall provide an opportunity for public 
comment on the proposed criteria for a period of at least 30 days.
    (2)(A) The Secretary shall, within 60 days of the transmittal of 
proposed criteria under paragraph (1), publish in the Federal Register 
and transmit to the Congressional resources committees the final 
criteria to be used in carrying out this section. Except as provided in 
subparagraph (B), such criteria shall be the final criteria to be used 
unless disapproved by a joint resolution of Congress enacted not more 
than 30 legislative days after receipt of the final criteria. For the 
purpose of the preceding sentence, the term ``legislative day'' means a 
day on which both Houses of Congress are in session.
    (B) The Secretary may amend such criteria, but such amendments may 
not become effective until they have been published in the Federal 
Register, opened to public comment for at least 30 days, and 
transmitted to the Congressional resources committees in final form.
    (b) Review.--(1)(A) Using the Plan deemed to be approved pursuant 
to section 9911(d) and the criteria developed pursuant to subsection 
(a), the Secretary shall review the existing National Park System to 
determine whether any existing units or significant portions of such 
units do not conform to the Plan. For any such areas, the Secretary 
shall determine whether there are more appropriate alternatives for 
managing all or a portion of such units, including through partnerships 
or direct management by States, local governments, other agencies and 
the private sector.
    (B) The Secretary shall develop a report which contains a list of 
any unit of the National Park System where National Park Service 
management should be terminated and a list of any portion of units 
where National Park Service management should be modified as a result 
of nonconformance with the Plan. No area or portion of an area which 
Congress has designated as a national park may be included in the 
report.
    (2) Should any such unit or portion of such unit not be recommended 
for continued National Park Service management, the Secretary shall 
make recommendations regarding management by an entity or entities 
other than the National Park Service.
    (3) For any such unit or portion of such unit determined to have 
national significance, prior to including such unit or portion of such 
unit on a list under paragraph (1), the Secretary shall identify 
feasible alternatives to National Park Service management which will 
protect the resources of and assure continued public access to the 
unit.
    (c) Consultation.--In developing the report referred to in 
subsection (b), the Secretary shall consult with other Federal land 
management agencies, State and local officials, resource management, 
recreation and scholarly organizations, and other interested parties as 
the Secretary deems advisable.
    (d) Transmittal.--Not later than 18 months after the Plan has been 
deemed approved, the Secretary shall transmit the report developed 
under this section simultaneously to the Congressional resources 
committees and the Commission. The report shall contain the 
recommendations of the Secretary for termination of National Park 
Service management for any unit of the National Park System that is 
determined not to conform with the Plan, a list of portions of units 
where National Park Service management should be modified, and the 
recommendations for alternative management by an entity or entities 
other than the National Park Service for such unit.

SEC. 9913. NATIONAL PARK SYSTEM REVIEW COMMISSION.

    (a) Establishment of Commission; Duties.--(1) Following completion 
of the Plan as specified in section 9911, a National Park System Review 
Commission shall be established.
    (2) The Commission shall either review the report developed under 
section 9912 or, if the Secretary fails to develop and transmit such 
report, develop the report itself. In conducting its review (or 
developing the report, if necessary), the Commission shall be subject 
to the provisions of sections 9912(b) and (c) in the same manner as 
such provisions apply to the Secretary. If the Secretary develops and 
transmits the report, the review of the Commission shall be limited to 
the manner in which the criteria have been applied to the existing 
National Park System. In addition the Commission shall seek broad 
public input and ensure the opportunity for input from persons who 
would be directly affected by recommendations regarding National Park 
System units identified in its report.
    (3) Within 2 years after the date of its establishment, the 
Commission shall prepare and transmit to the Congressional resources 
committees a report of its work under paragraph (2) in which the 
Commission recommends a list of National Park System units where 
National Park Service management should be terminated and a list of 
portions of units where National Park Service management should be 
modified.
    (b) Membership and Appointment.--The Commission shall consist of 11 
members, each of whom shall have substantial familiarity with, and 
understanding of, the National Park System and related fields. In 
addition, the Commission members shall have expertise in natural 
sciences, history, archaeology, and outdoor recreation. Five members of 
the Commission, one of whom shall be the Director of the National Park 
Service, shall be appointed by the Secretary. Two members shall be 
appointed by the Speaker of the United States House of Representatives 
in consultation with the chairman of the Committee on Resources, and 
one member shall be appointed by the Minority Leader of the House or 
Representatives in consultation with the ranking minority member of the 
Committee on Resources. Two members shall be appointed by the President 
pro tempore of the United States Senate, in consultation with the 
chairman of the Committee on Energy and Natural Resources and one 
member shall be appointed by the Minority Leader of the Senate in 
consultation with the ranking minority member of the Committee on 
Energy and Natural Resources. Each member shall be appointed within 
three months after the completion of the Plan as specified in section 
101.
    (c) Chair.--The Commission shall elect a chair from among its 
members.
    (d) Vacancies.--Vacancies occurring on the Commission shall not 
affect the authority of the remaining members of the Commission to 
carry out the functions of the Commission. Any vacancy in the 
Commission shall be promptly filled in the same manner in which the 
original appointment was made.
    (e) Quorum.--A simple majority of Commission members shall 
constitute a quorum.
    (f) Meetings.--The Commission shall meet at least quarterly or upon 
the call of the chair or a majority of the members of the Commission.
    (g) Compensation.--Members of the Commission shall serve without 
compensation as such. Members of the Commission, when engaged in 
official Commission business, shall be entitled to travel expenses, 
including per diem in lieu of subsistence, in the same manner as 
persons employed intermittently in government service under section 
5703 of title 5, United States Code.
    (h) Termination.--The Commission established pursuant to this 
section shall terminate 90 days after the transmittal of the report to 
Congress as provided in subsection (a).
    (i) Limitation on National Park Service Staff.--The Commission may 
hire staff to carry out its assigned responsibilities. Not more than 
one-half of the professional staff of the Commission shall be made up 
of current employees of the National Park Service.
    (j) Staff of Other Agencies.--Upon the request of the Commission, 
the head of any Federal agency may detail, on a reimbursable basis, any 
of the personnel of such agency to the Commission to assist the 
Commission.
    (k) Experts and Consultants.--Subject to such rules as may be 
adopted by the Commission, the Commission may procure temporary and 
intermittent services to the same extent as authorized by section 
3109(b) of title 5, United States Code, but at rates determined by the 
Commission to be advisable.
    (l) Powers of the Commission.--(1) The Commission shall for the 
purpose of carrying out this title hold such public hearings, sit and 
act at such times and places, take such testimony, and receive such 
evidence as the Commission deems advisable.
    (2) The Commission may make such bylaws, rules, and regulations, 
consistent with this part, as it considers necessary to carry out its 
functions under this part.
    (3) When so authorized by the Commission, any member or agent of 
the Commission may take any action which the Commission is authorized 
to take by this section.
    (4) The Commission may use the United States mails in the same 
manner and upon the same conditions as other departments and agencies 
of the United States.
    (5) The Secretary shall provide to the Commission any information 
available to the Secretary and requested by the Commission regarding 
the Plan and any other information requested by the Commission which is 
relevant to the duties of the Commission and available to the 
Secretary.

SEC. 9914. SUBSEQUENT ACT OF CONGRESS REQUIRED TO MODIFY OR TERMINATE A 
                    PARK.

    Nothing in this part shall be construed as modifying or terminating 
any unit of the National Park System without a subsequent Act of 
Congress. This limitation shall not limit any existing authority of the 
Secretary.

SEC. 9915. AUTHORIZATION OF APPROPRIATIONS.

    There are hereby authorized to be appropriated $2,000,000 to carry 
out the purposes of this part.

SEC. 9916. COMMENDATION AND PROTECTION OF NATIONAL PARK RANGERS.

    (a) Finding.--The Congress recognizes the dedication, expertise and 
courage of the men and women who serve as rangers and other employees 
of the National Park Service and finds their service to the protection 
of our park resources and the safety of the hundreds of millions of 
Americans who visit our national parks each year to be indispensable.
    (b) Protection of National Park Service Employees.--As soon as 
possible as part of the report developed under section 9911, the 
Secretary shall report on the procedures that have been instituted to 
report to the United States Attorney or other appropriate law 
enforcement official any intimidation, threats, or acts of violence 
against employees of the National Park Service related to their duties.

                     PART 2--NEW AREA ESTABLISHMENT

SEC. 9921. STUDY OF NEW PARK SYSTEM AREAS.

    Section 8 of the Act of August 18, 1970, entitled ``An Act to 
improve the Administration of the National Park System by the Secretary 
of the Interior, and to clarify the authorities applicable to the 
system, and for other purposes'' (16 U.S.C. 1a-1 and following) is 
amended as follows:
            (1) By inserting ``General Authority.--'' after ``(a)''.
            (2) By striking the second through the sixth sentences of 
        subsection (a).
            (3) By redesignating the last two sentences of subsection 
        (a) as subsection (f) and inserting in the first of such 
        sentences before the words ``For the purposes of carrying'' the 
        following: ``(f) Authorization of Appropriations.--''.
            (4) By striking subsection (b).
            (5) By inserting the following after subsection (a):
    ``(b) Studies of Areas for Potential Addition.--(1) At the 
beginning of each calendar year, along with the annual budget 
submission, the Secretary shall submit to the Committee on Resources of 
the House of Representatives and to the Committee on Energy and Natural 
Resources of the United States Senate a list of areas recommended for 
study for potential inclusion in the National Park System.
    ``(2) In developing the list to be submitted under this subsection, 
the Secretary shall give consideration to those areas that have the 
greatest potential to meet the established criteria of national 
significance, suitability, and feasibility. The Secretary shall give 
special consideration to themes, sites, and resources not already 
adequately represented in the National Park System as identified in the 
National Park System Plan to be developed under section 101 of the 
National Park System Reform Act of 1995.
    ``(3) No study of the potential of an area for inclusion in the 
National Park System may be initiated after the date of enactment of 
this subsection, except as provided by specific authorization of an Act 
of Congress.
    ``(4) Nothing in this Act shall limit the authority of the National 
Park Service to conduct preliminary resource assessments, gather data 
on potential study areas, provide technical and planning assistance, 
prepare or process nominations for administrative designations, update 
previous studies, or complete reconnaissance surveys of individual 
areas requiring a total expenditure of less than $25,000.
    ``(5) Nothing in this section shall be construed to apply to or to 
affect or alter the study of any river segment for potential addition 
to the national wild and scenic rivers system or to apply to or to 
affect or alter the study of any trail for potential addition to the 
national trails system.
    ``(c) Report.--(1) The Secretary shall complete the study for each 
area for potential inclusion in the National Park System within 3 
complete fiscal years following the date of enactment of specific 
legislation providing for the study of such area. Each study under this 
section shall be prepared with appropriate opportunity for public 
involvement, including at least one public meeting in the vicinity of 
the area under study, and after reasonable efforts to notify 
potentially affected landowners and State and local governments.
    ``(2) In conducting the study, the Secretary shall consider whether 
the area under study--
            ``(A) possesses nationally significant natural or cultural 
        resources, or outstanding recreational opportunities, and that 
        the area represents one of the most important examples of a 
        particular resource type in the country; and
            ``(B) is a suitable and feasible addition to the system.
    ``(3) Each study--
            ``(A) shall consider the following factors with regard to 
        the area being studied--
                    ``(i) the rarity and integrity of the resources;
                    ``(ii) the threats to those resources;
                    ``(iii) whether similar resources are already 
                protected in the National Park System or in other 
                public or private ownership;
                    ``(iv) the public use potential;
                    ``(v) the interpretive and educational potential;
                    ``(vi) costs associated with acquisition, 
                development and operation;
                    ``(vii) the socioeconomic impacts of any 
                designation;
                    ``(viii) the level of local and general public 
                support, and
                    ``(ix) whether the area is of appropriate 
                configuration to ensure long-term resource protection 
                and visitor use;
            ``(B) shall consider whether direct National Park Service 
        management or alternative protection by other public agencies 
        or the private sector is appropriate for the area;
            ``(C) shall identify what alternative or combination of 
        alternatives would in the professional judgment of the Director 
        of the National Park Service be most effective and efficient in 
        protecting significant resources and providing for public 
        enjoyment; and
            ``(D) may include any other information which the Secretary 
        deems to be relevant.
    ``(4) Each study shall be completed in compliance with the National 
Environmental Policy Act of 1969.
    ``(5) The letter transmitting each completed study to Congress 
shall contain a recommendation regarding the Secretary's preferred 
management option for the area.
    ``(d) New Area Study Office.--The Secretary shall establish a 
single office to be assigned to prepare all new area studies and to 
implement other functions of this section.
    ``(e) List of Areas.--At the beginning of each calendar year, along 
with the annual budget submission, the Secretary shall submit to the 
Committee on Resources of the House of Representatives and to the 
Committee on Energy and Natural Resources of the United States Senate a 
list of areas which have been previously studied which contain 
primarily historical resources, and a list of areas which have been 
previously studied which contain primarily natural resources, in 
numerical order of priority for addition to the National Park System. 
In developing the lists, the Secretary should consider threats to 
resource values, cost escalation factors, and other factors listed in 
subsection (c) of this section. The Secretary should only include on 
the lists areas for which the supporting data is current and 
accurate.''.

        TITLE X--COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                      Subtitle A--Water Resources

SEC. 10001. COMMERCIAL CONCESSIONS AT CORPS OF ENGINEERS PROJECTS.

    Notwithstanding part 1 of subtitle C of title IX of this Act, the 
Secretary of the Army shall not modify any concession service 
agreement, concession license, or similar instrument (or any policy or 
procedure relating to such agreement, license, or agreement) except to 
the extent that such modification is permitted under laws in effect on 
the day before the date of the enactment of this Act.

SEC. 10002. PROHIBITION ON SALE OF CORPS OF ENGINEERS PROJECTS.

    (a) Prohibition.--Notwithstanding part 1 of subtitle B of title IX 
of this Act, the sale of any project or project feature operated by the 
Corps of Engineers (including any dam, lock, reservoir, related 
transmission and generation structures, equipment, facilities, and real 
property) is prohibited.
    (b) Cooperation With Purchasers of Electric Power.--
            (1) In general.--Subject to paragraph (2), the Secretary of 
        the Army shall cooperate, to the maximum extent practicable, 
        with a non-Federal purchaser of electric power generated at any 
        project under the jurisdiction of the Secretary to facilitate 
        the purchaser's access to, operation of, and maintenance, 
        repair, rehabilitation, and replacement of hydroelectric power 
        facilities at the project.
            (2) Continued effectiveness of project purposes.--In 
        carrying out paragraph (1), the Secretary shall take such 
        actions as may be necessary to ensure that each project 
        referred to in paragraph (1) continues to operate in accordance 
        with the authorized purpose or purposes of the project.

SEC. 10003. FEMA RADIOLOGICAL EMERGENCY PREPAREDNESS FEES.

    (a) In General.--The Director of the Federal Emergency Management 
Agency may assess and collect fees applicable to persons subject to 
radiological emergency preparedness regulations issued by the Director.
    (b) Requirements.--The assessment and collection of fees by the 
Director under subsection (a) shall be fair and equitable and shall 
reflect the full amount of costs to the Agency of providing 
radiological emergency planning, preparedness, response, and associated 
services. Such fees shall be assessed by the Director in a manner which 
reflects the use of resources of the Agency for classes of regulated 
persons and the administrative costs of collecting such fees.
    (c) Amount of Fees.--The aggregate amount of fees assessed under 
subsection (a) in a fiscal year shall approximate, but not be less 
than, 100 percent of the amounts anticipated by the Director to be 
obligated for the radiological emergency preparedness program of the 
Agency for such fiscal year.
    (d) Deposit of Fees in Treasury.--Fees received pursuant to 
subsection (a) shall be deposited in the general fund of the Treasury 
as offsetting receipts.
    (e) Expiration of Authority.--The authority of the Director to 
assess and collect fees under subsection (a) shall expire on September 
30, 2002.

                   Subtitle B--Ocean Shipping Reform

SEC. 10201. SHORT TITLE.

    This subtitle may be cited as the ``Ocean Shipping Reform Act of 
1995''.

                    CHAPTER 1--OCEAN SHIPPING REFORM

SEC. 10211. PURPOSES.

    Section 2 of the Shipping Act of 1984 (46 U.S.C. App. 1701) is 
amended--
            (1) by striking ``and'' at the end of paragraph (2);
            (2) by striking the period at the end of paragraph (3) and 
        inserting ``; and''; and
            (3) by adding at the end the following:
            ``(4) to permit carriers and shippers to develop 
        transportation arrangements to meet their specific needs.''.

SEC. 10212. DEFINITIONS.

    Section 3 of the Shipping Act of 1984 (46 U.S.C. App. 1702) is 
amended--
            (1) effective January 1, 1997--
                    (A) by striking paragraph (9); and
                    (B) by redesignating paragraphs (10) through (19) 
                as paragraphs (9) through (18), respectively; and
            (2) effective June 1, 1997--
                    (A) by striking paragraph (4);
                    (B) in paragraph (7) by striking ``a common 
                tariff;'' and inserting ``a common schedule of 
                transportation rates, charges, classifications, rules, 
                and practices;'';
                    (C) by striking paragraph (10) (as redesignated by 
                paragraph (1) of this section);
                    (D) by striking paragraph (13) (as redesignated by 
                paragraph (1) of this section);
                    (E) by striking paragraph (16) (as redesignated by 
                paragraph (1) of this section);
                    (F) by striking paragraph (18) (as redesignated by 
                paragraph (1) of this section) and inserting the 
                following:
            ``(18) `ocean freight forwarder' means a person that--
                    ``(A)(i) in the United States, dispatches shipments 
                from the United States via a common carrier and books 
                or otherwise arranges space for those shipments on 
                behalf of shippers; or
                    ``(ii) processes the documentation or performs 
                related activities incident to those shipments; or
                    ``(B) acts as a common carrier that does not 
                operate the vessels by which the ocean transportation 
                is provided, and is a shipper in its relationship with 
                an ocean common carrier.'';
                    (G) by striking paragraph (21);
                    (H) in paragraph (23)--
                            (i) by striking ``or'' the second place it 
                        appears and inserting a comma; and
                            (ii) by striking the period and inserting 
                        ``, a shippers' association, or an ocean 
                        freight forwarder that accepts responsibility 
                        for payment of the ocean freight.'';
                    (I) by striking paragraph (24) and inserting the 
                following:
            ``(24) `shippers' association' means a group of shippers 
        that consolidates or distributes freight, on a nonprofit basis 
        for the members of the group in order to secure carload, 
        truckload, or other volume rates or ocean transportation 
        contracts.''; and
                    (J) by inserting after paragraph (18) (as 
                redesignated by paragraph (1) of this section) the 
                following:
            ``(19) `ocean transportation contract' means a contract in 
        writing separate from the bill of lading or receipt between 1 
        or more common carriers or a conference and 1 or more shippers 
        to provide specified services under specified rates and 
        conditions.''.

SEC. 10213. AGREEMENTS WITHIN THE SCOPE OF THE ACT.

    Effective June 1, 1997, section 4(a) of the Shipping Act of 1984 
(46 U.S.C. App. 1703(a)) is amended--
            (1) in paragraph (5) by striking ``non-vessel-operating 
        common carriers'' and inserting ``ocean freight forwarders''; 
        and
            (2) by striking paragraph (7) and inserting the following:
            ``(7) discuss any matter related to ocean transportation 
        contracts, and enter ocean transportation contracts and 
        agreements related to those contracts.''.

SEC. 10214. AGREEMENTS.

    Section 5 of the Shipping Act of 1984 (46 U.S.C. App. 1704) is 
amended--
            (1) effective January 1, 1997--
                    (A) in subsection (b)(4) by striking ``at the 
                request of any member, require an independent neutral 
                body to police fully'' and inserting ``state the 
                provisions, if any, for the policing of'';
                    (B) in subsection (b)(7) by striking ``and'' at the 
                end;
                    (C) in subsection (b)(8) by striking the period and 
                inserting ``; and''; and
                    (D) by adding at the end of subsection (b) the 
                following:
            ``(9) provide that a member of the conference may enter 
        individual and independent negotiations and may conclude 
        individual and independent service contracts under section 8 of 
        this Act.'';
            (2) effective June 1, 1997--
                    (A) by striking subsection (b)(8) and inserting the 
                following:
            ``(8) provide that any member of the conference may take 
        independent action on any rate or service item agreed upon by 
        the conference for transportation provided under section 8(a) 
        of this Act upon not more than 3 business days' notice to the 
        conference, and that the conference will provide the new rate 
        or service item for use by that member, effective no later than 
        3 business days after receipt of that notice, and by any other 
        member that notifies the conference that it elects to adopt the 
        independent rate or service item on or after its effective 
        date, in lieu of the existing conference provision for that 
        rate or service item;'';
                    (B) in subsection (b)(9) by striking ``service'' 
                and inserting ``ocean transportation'' and by striking 
                the period at the end and inserting ``; and'';
                    (C) by adding at the end of subsection (b) the 
                following:
            ``(10) prohibit the conference from--
                    ``(A) prohibiting or restricting the members of the 
                conference from engaging in individual negotiations for 
                ocean transportation contracts under section 8(b) with 
                1 or more shippers; and
                    ``(B) issuing mandatory rules or requirements 
                affecting ocean transportation contracts that may be 
                entered by 1 or more members of the conference, except 
                that a conference may require that a member of the 
                conference disclose the existence of an existing 
                individual ocean transportation contract or 
                negotiations on an ocean transportation contract, when 
                the conference enters negotiations on an ocean 
                transportation contract with the same shipper.''; and
                    (D) in subsection (e) by striking ``carrier that 
                are required to be set forth in a tariff,'' and 
                inserting ``carrier,''.

SEC. 10215. EXEMPTION FROM ANTITRUST LAWS.

    Section 7 of the Shipping Act of 1984 (46 U.S.C. App. 1706) is 
amended--
            (1) by striking subsection (a)(6) and inserting the 
        following:
            ``(6) subject to section 20(e)(2) of this Act, any 
        agreement, modification, or cancellation, in effect before the 
        effective date of this Act and any tariff, rate, fare, charge, 
        classification, rule, or regulation explanatory thereof 
        implementing that agreement, modification, or cancellation.''; 
        and
            (2) in subsection (c)(1) by striking ``agency'' and 
        inserting ``agency, department,''.

SEC. 10216. COMMON AND CONTRACT CARRIAGE.

    (a) In General.--Effective June 1, 1997--
            (1) section 502 of the High Seas Driftnet Fisheries 
        Enforcement Act (46 U.S.C. App. 1707a) is repealed; and
            (2) section 8 of the Shipping Act of 1984 (46 U.S.C. App. 
        1707) is amended to read as follows:

``SEC. 8. COMMON AND CONTRACT CARRIAGE.

    ``(a) Common Carriage.--
            ``(1) A common carrier and a conference shall make 
        available a schedule of transportation rates which shall 
        include the rates, terms, and conditions for transportation 
        services not governed by an ocean transportation contract, and 
        shall provide the schedule of transportation rates, in writing, 
        upon the request of any person. A common carrier and a 
        conference may assess a reasonable charge for complying with a 
        request for a rate, term, and condition, except that the charge 
        may not exceed the cost of providing the information requested.
            ``(2) A dispute between a common carrier or conference and 
        a person as to the applicability of the rates, terms, and 
        conditions for ocean transportation services shall be decided 
        in an appropriate State or Federal court of competent 
        jurisdiction, unless the parties otherwise agree.
            ``(3) A claim concerning a rate for ocean transportation 
        services which involves false billing, false classification, 
        false weighing, false report of weight, or false measurement 
        shall be decided in an appropriate State or Federal court of 
        competent jurisdiction, unless the parties otherwise agree.
    ``(b) Contract Carriage.--
            ``(1) 1 or more common carriers or a conference may enter 
        into an ocean transportation contract with 1 or more shippers. 
        A common carrier may enter into ocean transportation contracts 
        without limitations concerning the number of ocean 
        transportation contracts or the amount of cargo or space 
        involved. The status of a common carrier as an ocean common 
        carrier is not affected by the number or terms of ocean 
        transportation contracts entered.
            ``(2) A party to an ocean transportation contract entered 
        under this section shall have no duty in connection with 
        services provided under the contract other than the duties 
        specified by the terms of the contract.
            ``(3)(A) An ocean transportation contract or the 
        transportation provided under that contract may not be 
        challenged in any court on the grounds that the contract 
        violates a provision of this Act.
            ``(B) The exclusive remedy for an alleged breach of an 
        ocean transportation contract is an action in an appropriate 
        State or Federal court of competent jurisdiction, unless the 
        parties otherwise agree.
            ``(4) The requirements and prohibitions concerning 
        contracting by conferences contained in sections 5(b)(9) and 
        (10) of this Act shall also apply to any agreement among one or 
        more ocean common carriers that is filed under section 5(a) of 
        this Act.''.
    (b) Confidentiality of Contracts.--Effective January 1, 1998, 
section 8(b) of the Shipping Act of 1984 (46 U.S.C. App. 1707(b)), as 
amended by subsection (a) of this section, is amended by adding at the 
end the following:
            ``(5) A contract entered under this section may be made on 
        a confidential basis, upon agreement of the parties. An ocean 
        common carrier that is a member of a conference agreement may 
        not be prohibited or restricted from agreeing with 1 or more 
        shippers that the parties to the contract will not disclose the 
        rates, services, terms, or conditions of that contract to any 
        other member of the agreement, to the conference, to any other 
        carrier, shipper, conference, or to any other third party.''.

SEC. 10217. PROHIBITED ACTS.

    Section 10 of the Shipping Act of 1984 (46 U.S.C. App. 1709) is 
amended--
            (1) effective January 1, 1997, in subsection (b)--
                    (A) by striking paragraph (1) and inserting the 
                following:
            ``(1) except for service contracts, subject a person, 
        place, port, or shipper to unreasonable discrimination;''; and
                    (B) by striking paragraphs (2), (3), (4), and (8);
            (2) effective June 1, 1997, by striking subsection (b) and 
        inserting the following:
    ``(b) Common Carriers.--No common carrier, either alone or in 
conjunction with any other person, directly or indirectly, may--
            ``(1) except for ocean transportation contracts, subject a 
        person, place, port, or shipper to unreasonable discrimination;
            ``(2) retaliate against any shipper by refusing, or 
        threatening to refuse, cargo space accommodations when 
        available, or resort to other unfair or unjustly discriminatory 
        methods because the shipper has patronized another carrier or 
        has filed a complaint, or for any other reason;
            ``(3) employ any fighting ship;
            ``(4) subject any particular person, locality, class, or 
        type of shipper or description of traffic to an unreasonable 
        refusal to deal;
            ``(5) refuse to negotiate with a shippers' association;
            ``(6) knowingly and willfully accept cargo from or 
        transport cargo for the account of an ocean freight forwarder 
        that does not have a bond, insurance, or other surety as 
        required by section 19;
            ``(7) knowingly and willfully enter into an ocean 
        transportation contract with an ocean freight forwarder or in 
        which an ocean freight forwarder is listed as an affiliate that 
        does not have a bond, insurance, or other surety as required by 
        section 19; or
            ``(8)(A) knowingly disclose, offer, solicit, or receive any 
        information concerning the nature, kind, quantity, destination, 
        consignee, or routing of any property tendered or delivered to 
        a common carrier without the consent of the shipper or 
        consignee if that information--
                    ``(i) may be used to the detriment or prejudice of 
                the shipper or consignee;
                    ``(ii) may improperly disclose its business 
                transaction to a competitor; or
                    ``(iii) may be used to the detriment or prejudice 
                of any common carrier;
        except that nothing in this paragraph shall be construed to 
        prevent providing the information, in response to legal 
        process, to the United States, or to an independent neutral 
        body operating within the scope of its authority to fulfill the 
        policing obligations of the parties to an agreement effective 
        under this Act. Nor shall it be prohibited for any ocean common 
        carrier that is a party to a conference agreement approved 
        under this Act, or any receiver, trustee, lessee, agent, or 
        employee of that carrier, or any other person authorized by 
        that carrier to receive information, to give information to the 
        conference or any person, firm, corporation, or agency 
        designated by the conference or to prevent the conference or 
        its designee from soliciting or receiving information for the 
        purpose of determining whether a shipper or consignee has 
        breached an agreement with a conference or for the purpose of 
        determining whether a member of the conference has breached the 
        conference agreement or for the purpose of compiling statistics 
        of cargo movement, but the use of that information for any 
        other purpose prohibited by this Act or any other Act is 
        prohibited; and
            ``(B) after December 31, 1997, the rates, services, terms, 
        and conditions of an ocean transportation contract may not be 
        disclosed under this paragraph if the contract has been made on 
        a confidential basis under section 8(b) of this Act.
The exclusive remedy for a disclosure under this paragraph shall be an 
action for breach of contract as provided in section 8(b)(3) of this 
Act.'';
            (3) effective June 1, 1997--
                    (A) by striking subsection (c)(1) and inserting the 
                following:
                    ``(1) boycott, take any concerted action resulting 
                in an unreasonable refusal to deal, or implement a 
                policy or practice that results in an unreasonable 
                refusal to deal;'';
                    (B) in subsection (c)(5) by inserting ``as defined 
                in section 3(14)(A) of this Act'' after ``freight 
                forwarder''; and
                    (C) in subsection (c)(6) by striking ``a service 
                contract.'' and inserting ``an ocean transportation 
                contract.''; and
            (4) effective June 1, 1997, in subsection (d)(3) by 
        striking ``subsection (b) (11), (12), and (16)'' and inserting 
        ``paragraphs (1), (4), and (8) of subsection (b)''.

SEC. 10218. REPARATIONS.

    Effective June 1, 1997, section 11(g) of the Shipping Act of 1984 
(46 U.S.C. App. 1710(g)) is amended--
            (1) by inserting ``or counter-complainant'' after 
        ``complainant'' the second place it appears;
            (2) by striking ``10(b) (5) or (7)'' and inserting ``10(b) 
        (2) or (3)''; and
            (3) by striking the last sentence.

SEC. 10219. FOREIGN LAWS AND PRACTICES.

    Effective on June 1, 1997, section 10002 of the Foreign Shipping 
Practices Act of 1988 (46 U.S.C. App. 1710a) is amended--
            (1) in subsection (a)(1)--
                    (A) by striking `` `non-vessel-operating common 
                carrier',''; and
                    (B) by inserting `` `ocean freight forwarder','' 
                after `` `ocean common carrier','';
            (2) in subsection (a)(4) by striking ``non-vessel-operating 
        common carrier operations,'';
            (3) in subsection (e)(1) by striking subparagraphs (B), 
        (C), and (D) and inserting the following:
            ``(B) suspension, in whole or in part, of the right of an 
        ocean common carrier to operate under any agreement filed with 
        the Secretary, including agreements authorizing preferential 
        treatment at terminals, preferential terminal leases, space 
        chartering, or pooling of cargo or revenues with other ocean 
        common carriers; and
            ``(C) a fee, not to exceed $1,000,000 per voyage.''; and
            (4) in subsection (h) by striking ``section 13(b)(5) of the 
        Shipping Act of 1984 (46 U.S.C. App. 1712(b)(5))'' and 
        inserting ``section 13(b)(2) of the Shipping Act of 1984 (46 
        U.S.C. App. 1712(b)(2))''.

SEC. 10220. PENALTIES.

    Effective June 1, 1997, section 13 of the Shipping Act of 1984 (46 
U.S.C. App. 1712) is amended--
            (1) in subsection (b)--
                    (A) by striking paragraphs (1) and (3) and 
                redesignating paragraphs (2), (4), (5), and (6) as 
                paragraphs (1), (2), (3), and (4), respectively;
                    (B) by striking paragraph (1), as so redesignated, 
                and inserting the following:
            ``(1) If the Secretary finds, after notice and an 
        opportunity for a hearing, that a common carrier has failed to 
        supply information ordered to be produced or compelled by 
        subpoena under section 12 of this Act, the Secretary may 
        request that the Secretary of the Treasury refuse or revoke any 
        clearance required for a vessel operated by that common 
        carrier. Upon request by the Secretary, the Secretary of the 
        Treasury shall, with respect to the vessel concerned, refuse or 
        revoke any clearance required by section 4197 of the Revised 
        Statutes of the United States (46 U.S.C. App. 91).''; and
                    (C) in paragraph (3), as so redesignated, by 
                striking ``finds appropriate,'' and all that follows 
                through the period at the end and inserting ``finds 
                appropriate including the imposition of the penalties 
                authorized under paragraph (2).''; and
            (2) in subsection (f)(1) by striking ``section 10 (a)(1), 
        (b)(1), or (b)(4)'' and inserting ``section 10(a)(1)''.

SEC. 10221. REPORTS.

    (a) In General.--Effective January 1, 1997, section 15 of the 
Shipping Act of 1984 (46 U.S.C. App. 1714) is amended--
            (1) in the section heading by striking ``and 
        certificates'';
            (2) by striking ``(a) Reports.--''; and
            (3) by striking subsection (b).
    (b) Clerical Amendment.--The table of contents contained in the 
first section of such Act (46 U.S.C. App. 1701) is amended by striking 
the item relating to section 15 and inserting the following:

``Sec. 15. Reports.''.

SEC. 10222. REGULATIONS.

    Section 17 of the Shipping Act of 1984 (46 U.S.C. App. 1716) is 
amended--
            (1) by striking ``(a)''; and
            (2) by striking subsection (b).

SEC. 10223. REPEAL.

    (a) Repeal.--Section 18 of the Shipping Act of 1984 (46 U.S.C. App. 
1717) is repealed.
    (b) Clerical Amendment.--The table of contents contained in the 
first section of such Act (46 U.S.C. App. 1701) is amended by striking 
the item relating to section 18.

SEC. 10224. OCEAN FREIGHT FORWARDERS.

    Effective June 1, 1997, section 19 of the Shipping Act of 1984 (46 
U.S.C. App. 1718) is amended--
            (1) by striking subsection (a) and inserting the following:
    ``(a) License.--No person in the United States may act as an ocean 
freight forwarder unless that person holds a license issued by the 
Commission. The Commission shall issue a forwarder's license to any 
person that the Commission determines to be qualified by experience and 
character to render forwarding services.'';
            (2) by redesignating subsections (b), (c), and (d) as 
        subsections (c), (d), and (e), respectively;
            (3) by inserting after subsection (a) the following:
    ``(b) Financial Responsibility.--
            ``(1) No person may act as an ocean freight forwarder 
        unless that person furnishes a bond, proof of insurance, or 
        other surety in a form and amount determined by the Commission 
        to insure financial responsibility that is issued by a surety 
        company found acceptable by the Secretary of the Treasury.
            ``(2) A bond, insurance, or other surety obtained pursuant 
        to this section shall be available to pay any judgment for 
        damages against an ocean freight forwarder arising from its 
        transportation-related activities under this Act or order for 
        reparation issued pursuant to section 11 or 14 of this Act.
            ``(3) An ocean freight forwarder not domiciled in the 
        United States shall designate a resident agent in the United 
        States for receipt of service of judicial and administrative 
        process, including subpoenas.'';
            (4) in subsection (c), as redesignated by paragraph (2) of 
        this section, by striking ``a bond in accordance with 
        subsection (a)(2)'' and inserting ``a bond, proof of insurance, 
        or other surety in accordance with subsection (b)(1)''; and
            (5) in subsection (e), as redesignated by paragraph (2) of 
        this section--
                    (A) by striking paragraph (3) and redesignating 
                paragraph (4) as paragraph (3); and
                    (B) by adding at the end the following:
            ``(4) No conference or group of 2 or more ocean common 
        carriers in the foreign commerce of the United States that is 
        authorized to agree upon the level of compensation paid to an 
        ocean freight forwarder, as defined in section 3(18)(A) of this 
        Act, may--
                    ``(A) deny to any member of the conference or group 
                the right, upon notice of not more than 3 business 
                days, to take independent action on any level of 
                compensation paid to an ocean freight forwarder; or
                    ``(B) agree to limit the payment of compensation to 
                an ocean freight forwarder, as defined in section 
                3(18)(A) of this Act, to less than 1.25 percent of the 
                aggregate of all rates and charges which are applicable 
                under a common schedule of transportation rates 
                provided under section 8(a) of this Act, and which are 
                assessed against the cargo on which the forwarding 
                services are provided.''.

SEC. 10225. EFFECTS ON CERTAIN AGREEMENTS AND CONTRACTS.

    Section 20(e) of the Shipping Act of 1984 (46 U.S.C. App. 1719) is 
amended to read as follows:
    ``(e) Savings Provisions.--
            ``(1) Each service contract entered into by a shipper and 
        an ocean common carrier or conference before the date of the 
        enactment of the Ocean Shipping Reform Act of 1995 may remain 
        in full force and effect according to its terms.
            ``(2) This Act and the amendments made by this Act shall 
        not affect any suit--
                    ``(A) filed before the date of the enactment of the 
                Ocean Shipping Reform Act of 1995;
                    ``(B) with respect to claims arising out of conduct 
                engaged in before the date of the enactment of the 
                Ocean Shipping Reform Act of 1995, filed within 1 year 
                after the date of the enactment of the Ocean Shipping 
                Reform Act of 1995;
                    ``(C) with respect to claims arising out of conduct 
                engaged in after the date of the enactment of the Ocean 
                Shipping Reform Act of 1995 but before January 1, 1997, 
                pertaining to a violation of section 10(b) (1), (2), 
                (3), (4), or (8), as in effect before January 1, 1997, 
                filed by June 1, 1997;
                    ``(D) with respect to claims pertaining to the 
                failure of a common carrier or conference to file its 
                tariffs or service contracts in accordance with this 
                Act in the period beginning January 1, 1997, and ending 
                June 1, 1997, filed by December 31, 1997; or
                    ``(E) with respect to claims arising out of conduct 
                engaged in on or after the date of the enactment of the 
                Ocean Shipping Reform Act of 1995 but before June 1, 
                1997, filed by December 31, 1997.''.

SEC. 10226. REPEAL.

    (a) Repeal.--Effective June 1, 1997, section 23 of the Shipping Act 
of 1984 (46 U.S.C. App. 1721) is repealed.
    (b) Clerical Amendment.--Effective June 1, 1997, the table of 
contents contained in the first section of such Act (46 U.S.C. App. 
1701) is amended by striking the item relating to section 23.

SEC. 10227. MARINE TERMINAL OPERATOR SCHEDULES.

    (a) In General.--Effective June 1, 1997, the Shipping Act of 1984 
(46 U.S.C. App. 1701 et seq.) is amended by adding at the end the 
following:

``SEC. 24. MARINE TERMINAL OPERATOR SCHEDULES.

    ``A marine terminal operator shall make available to the public a 
schedule of rates, regulations, and practices, including limitations of 
liability, pertaining to receiving, delivering, handling, or storing 
property at its marine terminal. The schedule shall be enforceable as 
an implied contract, without proof of actual knowledge of its 
provisions, for any activity by the marine terminal operator that is 
taken to--
            ``(1) efficiently transfer property between transportation 
        modes;
            ``(2) protect property from damage or loss;
            ``(3) comply with any governmental requirement; or
            ``(4) store property in excess of the terms of any other 
        contract or agreement, if any, entered into by the marine 
        terminal operator.''.
    (b) Clerical Amendment.--The table of contents contained in the 
first section of such Act (46 U.S.C. App. 1701) is amended by adding at 
the end the following:

``Sec. 24. Marine terminal operator schedules.''.

               CHAPTER 2--CONTROLLED CARRIERS AMENDMENTS

SEC. 10231. CONTROLLED CARRIERS.

    Effective June 1, 1997, section 9 of the Shipping Act of 1984 (46 
U.S.C. App. 1708) is amended--
            (1)(A) in the first sentence of subsection (a)--
                    (i) by striking ``in its tariffs or service 
                contracts filed with the Commission''; and
                    (ii) by striking ``in those tariffs or service 
                contracts''; and
            (B) in the last sentence of subsection (a) by striking 
        ``filed by a controlled carrier'';
            (2) in paragraphs (1) and (2) of subsection (b) by striking 
        ``filed'' and inserting ``published'';
            (3) in subsection (c) by striking the first sentence;
            (4) by striking subsection (d) and inserting the following:
    ``(d) Within 120 days of the receipt of information requested by 
the Secretary under this section, the Secretary shall determine whether 
the rates, charges, classifications, rules, or regulations of a 
controlled carrier may be unjust and unreasonable. If so, the Secretary 
shall issue an order to the controlled carrier to show cause why those 
rates, charges, classifications, rules, or regulations should not be 
approved. Pending a determination, the Secretary may suspend the rates, 
charges, classifications, rules, or regulations at any time. No period 
of suspension may be greater than 180 days. Whenever the Secretary has 
suspended any rates, charges, classifications, rules, or regulations 
under this subsection, the affected carrier may publish and, after 
notification to the Secretary, assess new rates, charges, 
classifications, rules, or regulations--except that the Secretary may 
reject the new rates, charges, classifications, rules, or regulations 
if the Secretary determines that they are unreasonable.'';
            (5) in subsection (f) by striking ``This'' and inserting 
        ``Subject to subsection (g), this''; and
            (6) by adding at the end the following:
    ``(g) The rate standards, information submissions, remedies, 
reviews, and penalties in this section shall also apply to ocean common 
carriers that are not controlled, but who have been determined by the 
Secretary to be structurally or financially affiliated with 
nontransportation entities or organizations (government or private) in 
such a way as to affect their pricing or marketplace behavior in an 
unfair, predatory, or anticompetitive way that disadvantages an ocean 
common carrier or carriers. The Secretary may make such determinations 
upon request of any person or upon the Secretary's own motion, after 
conducting an investigation and a public hearing.
    ``(h) The Secretary shall issue regulations by June 1, 1997, that 
prescribe the procedures and requirements that would govern how price 
and other information is to be submitted by controlled carriers and 
carriers subject to determinations made under subsection (g) when such 
information would be needed to determine whether prices charged by 
these carriers are unfair, predatory, or anticompetitive.
    ``(i) In any instance where information provided to the Secretary 
under this section does not result in an affirmative finding or 
enforcement action by the Secretary that information may not be made 
public and shall be exempt from disclosure under section 552 of title 
5, United States Code, except as may be relevant to an administrative 
or judicial action or proceeding. This section does not prevent 
disclosure to either body of Congress or to a duly authorized committee 
or subcommittee of Congress.''.

SEC. 10232. NEGOTIATING STRATEGY TO REDUCE GOVERNMENT OWNERSHIP AND 
                    CONTROL OF COMMON CARRIERS.

    Not later than January 1, 1997, the Secretary of Transportation 
shall develop, submit to Congress, and begin implementing a negotiation 
strategy to persuade foreign governments to divest themselves of 
ownership and control of ocean common carriers (as that term is defined 
in section 3(18) of the Shipping Act of 1984 (46 U.S.C. App. 1702).

SEC. 10233. ANNUAL REPORT BY THE SECRETARY.

    Not later than September 30, 1998, and annually thereafter, the 
Secretary shall report to Congress on the actions taken under the 
Foreign Shipping Practices Act (46 U.S.C. App. 1708), section 9 of the 
Shipping Act of 1984 (46 U.S.C. App. 1708), and section 10232 of this 
Act and the effect on United States maritime employment of laws, rules, 
regulations, policies, or practices of foreign governments, or any 
practices of foreign carriers or other persons providing maritime or 
maritime-related services in a foreign country that result in the 
existence of conditions that adversely affect the operations of United 
States carriers in United States oceanborne trade.

       CHAPTER 3--ELIMINATION OF THE FEDERAL MARITIME COMMISSION

SEC. 10241. PLAN FOR AGENCY TERMINATION.

    (a) In General.--No later than 30 days after the date of the 
enactment of this Act, the Director of the Office of Management and 
Budget, in consultation with the Secretary of Transportation, shall 
submit to Congress a plan to eliminate the Federal Maritime Commission 
no later than October 1, 1997. The plan shall include a timetable for 
the transfer of remaining functions of the Federal Maritime Commission 
to the Secretary of Transportation beginning as soon as feasible in 
fiscal year 1996. The plan shall also address matters related to 
personnel and other resources necessary for the Secretary of 
Transportation to perform the remaining functions of the Federal 
Maritime Commission.
    (b) Implementation.--The Director of the Office of Management and 
Budget shall implement the plan to eliminate the Federal Maritime 
Commission submitted to Congress under subsection (a) beginning as soon 
as feasible in fiscal year 1996.
    (c) Authorization of Appropriations.--There are authorized to be 
appropriated such sums as may be necessary to carry out this subtitle 
and the amendments made by this subtitle.

             Subtitle C--Midewin National Tallgrass Prairie

                     CHAPTER 1--GENERAL PROVISIONS

SEC. 10301. SHORT TITLE.

    This subtitle may be cited as the ``Illinois Land Conservation Act 
of 1995''.

SEC. 10302. DEFINITIONS.

    For purposes of this subtitle, the following definitions apply:
            (1) Administrator.--The term ``Administrator'' means the 
        Administrator of the United States Environmental Protection 
        Agency.
            (2) Agricultural purposes.--The term ``agricultural 
        purposes'' means the use of land for row crops, pasture, hay, 
        and grazing.
            (3) Arsenal.--The term ``Arsenal'' means the Joliet Army 
        Ammunition Plant located in the State of Illinois.
            (4) CERCLA.--The term ``CERCLA'' means the Comprehensive 
        Environmental Response, Compensation, and Liability Act of 1980 
        (42 U.S.C. 9601 et seq.).
            (5) Defense environmental restoration program.--The term 
        ``Defense Environmental Restoration Program'' means the program 
        of environmental restoration for defense installations 
        established by the Secretary of Defense under section 2701 of 
        title 10, United States Code.
            (6) Environmental law.--The term ``environmental law'' 
        means all applicable Federal, State, and local laws, 
        regulations, and requirements related to protection of human 
        health, natural and cultural resources, or the environment, 
        including CERCLA, the Solid Waste Disposal Act (42 U.S.C. 6901 
        et seq.), the Federal Water Pollution Control Act (33 U.S.C. 
        1251 et seq.), the Clean Air Act (42 U.S.C. 7401 et seq.), the 
        Federal Insecticide, Fungicide, and Rodenticide Act (7 U.S.C. 
        136 et seq.), the Toxic Substances Control Act (15 U.S.C. 2601 
        et seq.), and the Safe Drinking Water Act (42 U.S.C. 300f et 
        seq.).
            (7) Hazardous waste.--The term ``hazardous substance'' has 
        the meaning given such term by section 101(14) of CERCLA (42 
        U.S.C. 9601(14)).
            (8) MNP.--The term ``MNP'' means the Midewin National 
        Tallgrass Prairie established pursuant to section 10314 and 
        managed as a part of the National Forest System.
            (9) National cemetery.--The term ``national cemetery'' 
        means a cemetery established and operated as part of the 
        National Cemetery System of the Department of Veterans Affairs 
        and subject to the provisions of chapter 24 of title 38, United 
        States Code.
            (10) Person.--The term ``person'' has the meaning given 
        such term by section 101(21) of CERCLA (42 U.S.C. 9601(21)).
            (11) Pollutant or contaminant.--The term ``pollutant or 
        contaminant'' has the meaning given such term by section 
        101(33) of CERCLA (42 U.S.C. 9601(33)).
            (12) Release.--The term ``release'' has the meaning given 
        such term by section 101(22) of CERCLA (42 U.S.C. 9601(22)).
            (13) Response action.--The term ``response action'' has the 
        meaning given the term ``response'' by section 101(25) of 
        CERCLA (42 U.S.C. 9601(25)).

   CHAPTER 2--CONVERSION OF JOLIET ARMY AMMUNITION PLANT TO MIDEWIN 
                       NATIONAL TALLGRASS PRAIRIE

SEC. 10311. PRINCIPLES OF TRANSFER.

    (a) Land Use Plan.--The Congress ratifies in principle the 
proposals generally identified by the land use plan which was developed 
by the Joliet Arsenal Citizen Planning Commission and unanimously 
approved on May 30, 1995.
    (b) Transfer Without Reimbursement.--The area constituting the 
Midewin National Tallgrass Prairie shall be transferred, without 
reimbursement, to the Secretary of Agriculture.
    (c) Management of MNP.--Management by the Secretary of Agriculture 
of those portions of the Arsenal transferred to the Secretary under 
this subtitle shall be in accordance with sections 10314 and 10315 
regarding the Midewin National Tallgrass Prairie.
    (d) Security Measures.--The Secretary of the Army and the Secretary 
of Agriculture shall each provide and maintain physical and other 
security measures on such portion of the Arsenal as is under the 
administrative jurisdiction of such Secretary. Such security measures 
(which may include fences and natural barriers) shall include measures 
to prevent members of the public from gaining unauthorized access to 
such portions of the Arsenal as are under the administrative 
jurisdiction of such Secretary and that may endanger health or safety.
    (e) Cooperative Agreements.--The Secretary of the Army, the 
Secretary of Agriculture, and the Administrator are individually and 
collectively authorized to enter into cooperative agreements and 
memoranda of understanding among each other and with other affected 
Federal agencies, State and local governments, private organizations, 
and corporations to carry out the purposes for which the Midewin 
National Tallgrass Prairie is established.
    (f) Interim Activities of the Secretary of Agriculture.--Prior to 
transfer and subject to such reasonable terms and conditions as the 
Secretary of the Army may prescribe, the Secretary of Agriculture may 
enter upon the Arsenal property for purposes related to planning, 
resource inventory, fish and wildlife habitat manipulation (which may 
include prescribed burning), and other such activities consistent with 
the purposes for which the Midewin National Tallgrass Prairie is 
established.

SEC. 10312. TRANSFER OF MANAGEMENT RESPONSIBILITIES AND JURISDICTION 
                    OVER ARSENAL.

    (a) Initial Transfer of Jurisdiction.--Within 6 months after the 
date of the enactment of this Act, the Secretary of the Army shall 
effect the transfer of those portions of the Arsenal property 
identified for transfer to the Secretary of Agriculture pursuant to 
subsection (d). The Secretary of the Army shall transfer to the 
Secretary of Agriculture only those portions of the Arsenal for which 
the Secretary of the Army and the Administrator concur that no further 
action is required under any environmental law and which therefore have 
been eliminated from the areas to be further studied pursuant to the 
Defense Environmental Restoration Program for the Arsenal. Within 4 
months after the date of the enactment of this Act, the Secretary of 
the Army and the Administrator shall provide to the Secretary of 
Agriculture all existing documentation supporting such finding and all 
existing information relating to the environmental conditions of the 
portions of the Arsenal to be transferred to the Secretary of 
Agriculture pursuant to this subsection.
    (b) Additional Transfers.--The Secretary of the Army shall transfer 
to the Secretary of Agriculture in accordance with section 10316(c) any 
portion of the property generally identified in subsection (d) and not 
transferred under subsection (a) after the Secretary of the Army and 
the Administrator concur that no further action is required at that 
portion of property under any environmental law and that such portion 
is therefore eliminated from the areas to be further studied pursuant 
to the Defense Environmental Restoration Program for the Arsenal. At 
least 2 months before any transfer under this subsection, the Secretary 
of the Army and the Administrator shall provide to the Secretary of 
Agriculture all existing documentation supporting such finding and all 
existing information relating to the environmental conditions of the 
portion of the Arsenal to be transferred. Transfer of jurisdiction 
pursuant to this subsection may be accomplished on a parcel-by-parcel 
basis.
    (c) Effect on Continued Responsibilities and Liability of Secretary 
of the Army.--Subsections (a) and (b), and their requirements, shall 
not in any way affect the responsibilities and liabilities of the 
Secretary of the Army specified in section 10313.
    (d) Identification of Portions for Transfer for MNP.--The lands to 
be transferred to the Secretary of Agriculture under subsections (a) 
and (b) shall be identified on a map or maps which shall be agreed to 
by the Secretary of the Army and the Secretary of Agriculture. 
Generally, the land to be transferred to the Secretary of Agriculture 
shall be all the real property and improvements comprising the Arsenal, 
except for lands and facilities described in subsection (e) or 
designated for transfer or disposal under section 10316 or chapter 3.
    (e) Property Used for Environmental Cleanup.--
            (1) Retention.--The Secretary of the Army shall retain 
        jurisdiction, authority, and control over real property at the 
        Arsenal to be used for--
                    (A) water treatment;
                    (B) the treatment, storage, or disposal of any 
                hazardous substance, pollutant or contaminant, 
                hazardous material, or petroleum products or their 
                derivatives;
                    (C) other purposes related to any response action 
                at the Arsenal; and
                    (D) other actions required at the Arsenal under any 
                environmental law to remediate contamination or 
                conditions of noncompliance with any environmental law.
            (2) Conditions.--The Secretary of the Army shall consult 
        with the Secretary of Agriculture regarding the identification 
        and management of the real property retained under this 
        subsection and ensure that activities carried out on that 
        property are consistent, to the extent practicable, with the 
        purposes for which the Midewin National Tallgrass Prairie is 
        established, as specified in section 10314(c), and with the 
        other provisions of sections 10314 and 10315.
            (3) Priority of response actions.--In the case of any 
        conflict between management of the property by the Secretary of 
        Agriculture and any response action, or any other action 
        required under any other environmental law, including actions 
        to remediate petroleum products of their derivatives, the 
        response action or other action shall take priority.
    (f) Surveys.--All costs of necessary surveys for the transfer of 
jurisdiction of Arsenal property from the Secretary of the Army to the 
Secretary of Agriculture shall be borne by the Secretary of 
Agriculture.

SEC. 10313. CONTINUATION OF RESPONSIBILITY AND LIABILITY OF SECRETARY 
                    OF THE ARMY FOR ENVIRONMENTAL CLEANUP.

    (a) Responsibility.--The liabilities and responsibilities of the 
Secretary of the Army under any environmental law shall not transfer 
under any circumstances to the Secretary of Agriculture as a result of 
the property transfers made under section 10312 or section 10316, or as 
a result of interim activities of the Secretary of Agriculture on 
Arsenal property under section 10311(f). With respect to the real 
property at the Arsenal, the Secretary of the Army shall remain liable 
for and continue to carry out--
            (1) all response actions required under CERCLA at or 
        related to the property;
            (2) all remediation actions required under any other 
        environmental law at or related to the property; and
            (3) all actions required under any other environmental law 
        to remediate petroleum products or their derivatives (including 
        motor oil and aviation fuel) at or related to the property.
    (b) Liability.--
            (1) In general.--Nothing in this Act shall be construed to 
        effect, modify, amend, repeal, alter, limit, or otherwise 
        change, directly or indirectly, the responsibilities or 
        liabilities under any environmental law of any person 
        (including the Secretary of Agriculture), except as provided in 
        paragraph (3) with respect to the Secretary of Agriculture.
            (2) Liability of secretary of the army.--The Secretary of 
        the Army shall retain any obligation or other liability at the 
        Arsenal that the Secretary may have under CERCLA and other 
        environmental laws. Following transfer of any portions of the 
        Arsenal pursuant to this Act, the Secretary of the Army shall 
        be accorded all easements and access to such property as may be 
        reasonably required to carry out such obligation or satisfy 
        such liability.
            (3) Special rules for secretary of agriculture.--The 
        Secretary of Agriculture shall not be responsible or liable 
        under any environmental law for matters which are in any way 
        related directly or indirectly to activities of the Secretary 
        of the Army, or any party acting under the authority of the 
        Secretary in connection with the Defense Environmental 
        Restoration Program, at the Arsenal and which are for any of 
        the following:
                    (A) Costs of response actions required under CERCLA 
                at or related to the Arsenal.
                    (B) Costs, penalties, or fines related to 
                noncompliance with any environmental law at or related 
                to the Arsenal or related to the presence, release, or 
                threat of release of any hazardous substance, 
                pollutant, contaminant, hazardous waste or hazardous 
                material of any kind at or related to the Arsenal, 
                including contamination resulting from migration of 
                hazardous substances, pollutants, contaminants, 
                hazardous materials, or petroleum products or their 
                derivatives disposed during activities of the 
                Department of the Army.
                    (C) Costs of actions necessary to remedy such 
                noncompliance or other problem specified in 
                subparagraph (B).
    (c) Payment of Response Action Costs.--Any Federal department or 
agency that had or has operations at the Arsenal resulting in the 
release or threatened release of hazardous substances, pollutants, or 
contaminants shall pay the cost of related response actions, or related 
actions under other environmental laws, including actions to remediate 
petroleum products or their derivatives.
    (d) Consultation.--The Secretary of Agriculture shall consult with 
the Secretary of the Army with respect to the Secretary of 
Agriculture's management of real property included in the Midewin 
National Tallgrass Prairie subject to any response action or other 
action at the Arsenal being carried out by or under the authority of 
the Secretary of the Army under any environmental law. The Secretary of 
Agriculture shall consult with the Secretary of the Army prior to 
undertaking any activities on the Midewin National Tallgrass Prairie 
that may disturb the property to ensure that such activities will not 
exacerbate contamination problems or interfere with performance by the 
Secretary of the Army of response actions at the property. In carrying 
out response actions at the Arsenal, the Secretary of the Army shall 
consult with the Secretary of Agriculture to ensure that such actions 
are carried out in a manner consistent with the purposes for which the 
Midewin National Tallgrass Prairie is established, as specified in 
section 10314(c), and the other provisions of sections 10314 and 10315.

SEC. 10314. ESTABLISHMENT AND ADMINISTRATION OF MIDEWIN NATIONAL 
                    TALLGRASS PRAIRIE.

    (a) Establishment.--On the effective date of the initial transfer 
of jurisdiction of portions of the Arsenal to the Secretary of 
Agriculture under section 10312(a), the Secretary of Agriculture shall 
establish the Midewin National Tallgrass Prairie. The MNP shall--
            (1) be administered by the Secretary of Agriculture; and
            (2) consist of the real property so transferred and such 
        other portions of the Arsenal subsequently transferred under 
        section 10312(b) or 10316.
    (b) Administration.--
            (1) In general.--The Secretary of Agriculture shall manage 
        the Midewin National Tallgrass Prairie as a part of the 
        National Forest System in accordance with this Act and the 
        laws, rules, and regulations pertaining to the National Forest 
        System, except that the Bankhead-Jones Farm Tenant Act of 1937 
        (7 U.S.C. 1010-1012) shall not apply to the MNP.
            (2) Initial management activities.--In order to expedite 
        the administration and public use of the Midewin National 
        Tallgrass Prairie, the Secretary of Agriculture may conduct 
        management activities at the MNP to effectuate the purposes for 
        which the MNP is established, as specified in subsection (c), 
        in advance of the development of a land and resource management 
        plan for the MNP.
            (3) Land and resource management plan.--In developing a 
        land and resource management plan for the Midewin National 
        Tallgrass Prairie, the Secretary of Agriculture shall consult 
        with the Illinois Department of Conservation and local 
        governments adjacent to the MNP and provide an opportunity for 
        public comment. Any parcel transferred to the Secretary of 
        Agriculture under this Act after the development of a land and 
        resource management plan for the MNP may be managed in 
        accordance with such plan without need for an amendment to the 
        plan.
    (c) Purposes of the Midewin National Tallgrass Prairie.--The 
Midewin National Tallgrass Prairie is established to be managed for 
National Forest System purposes, including the following:
            (1) To manage the land and water resources of the MNP in a 
        manner that will conserve and enhance the native populations 
        and habitats of fish, wildlife, and plants.
            (2) To provide opportunities for scientific, environmental, 
        and land use education and research.
            (3) To allow the continuation of agricultural uses of lands 
        within the MNP consistent with section 10315(b).
            (4) To provide a variety of recreation opportunities that 
        are not inconsistent with the preceding purposes.
    (d) Other Land Acquisition for MNP.--
            (1) Land acquisition funds.--Notwithstanding section 7 of 
        the Land and Water Conservation Fund Act of 1965 (16 U.S.C. 
        460l-9), monies appropriated from the Land and Water 
        Conservation Fund established under section 2 of such Act (16 
        U.S.C. 460l-5) shall be available for acquisition of lands and 
        interests in land for inclusion in the Midewin National 
        Tallgrass Prairie.
            (2) Acquisition of private lands.--Acquisition of private 
        lands for inclusion in the Midewin National Tallgrass Prairie 
        shall be on a willing seller basis only.
    (e) Cooperation With States, Local Governments and Other 
Entities.--In the management of the Midewin National Tallgrass Prairie, 
the Secretary of Agriculture is authorized and encouraged to cooperate 
with appropriate Federal, State, and local governmental agencies, 
private organizations and corporations. Such cooperation may include 
cooperative agreements as well as the exercise of the existing 
authorities of the Secretary under the Cooperative Forestry Assistance 
Act of 1978 and the Forest and Rangeland Renewable Resources Research 
Act of 1978. The objects of such cooperation may include public 
education, land and resource protection and cooperative management 
among government, corporate, and private landowners in a manner which 
furthers the purposes for which the Midewin National Tallgrass Prairie 
is established.

SEC. 10315. SPECIAL MANAGEMENT REQUIREMENTS FOR MIDEWIN NATIONAL 
                    TALLGRASS PRAIRIE.

    (a) Prohibition Against the Construction of New Through Roads.--No 
new construction of any highway, public road, or any part of the 
interstate system, whether Federal, State, or local, shall be permitted 
through or across any portion of the Midewin National Tallgrass 
Prairie. Nothing herein shall preclude construction and maintenance of 
roads for use within the MNP or the granting of authorizations for 
utility rights-of-way under applicable Federal law or preclude such 
access as is necessary. Nothing herein shall preclude necessary access 
by the Secretary of the Army for purposes of restoration and cleanup as 
provided in this subtitle.
    (b) Agricultural Leases and Special Use Authorizations.--Within the 
Midewin National Tallgrass Prairie, use of the lands for agricultural 
purposes shall be permitted subject to the following terms and 
conditions:
            (1) If, at the time of transfer of jurisdiction under 
        section 10312, there exists any lease issued by the Department 
        of the Army, Department of Defense, or any other agency 
        thereof, for agricultural purposes upon the parcel transferred, 
        the Secretary of Agriculture, upon transfer of jurisdiction, 
        shall convert the lease to a special use authorization, the 
        terms of which shall be identical in substance to the lease 
        that existed prior to the transfer, including the expiration 
        date and any payments owed the United States.
            (2) The Secretary of Agriculture may issue special use 
        authorizations to persons for use of the Midewin National 
        Tallgrass Prairie for agricultural purposes. Special use 
        authorizations issued pursuant to this paragraph shall include 
        terms and conditions as the Secretary of Agriculture may deem 
        appropriate.
            (3) No agricultural special use authorization shall be 
        issued for agricultural purposes which has a term extending 
        beyond the date 20 years from the date of the enactment of this 
        Act, except that nothing in this Act shall preclude the 
        Secretary of Agriculture from issuing agricultural special use 
        authorizations or grazing permits which are effective after 20 
        years from the date of the enactment of this Act for purposes 
        primarily related to erosion control, provision for food and 
        habitat for fish and wildlife, or other resource management 
        activities consistent with the purposes of the Midewin National 
        Tallgrass Prairie.
    (c) Treatment of Rental Fees.--Monies received pursuant to 
subsection (b) shall be subject to distribution to the State of 
Illinois and affected counties pursuant to the Acts of May 23, 1908, 
and March 1, 1911 (16 U.S.C. 500). All such monies not distributed 
pursuant to such Acts shall be deposited into the Treasury and shall 
constitute a special fund, which shall be available to the Secretary of 
Agriculture, in such amounts as are provided in advance in 
appropriation Acts, to cover the cost to the United States of such 
prairie-improvement work as the Secretary may direct. Any portion of 
any deposit made to the fund which the Secretary determines to be in 
excess of the cost of doing such work shall be transferred, upon such 
determination, to miscellaneous receipts, Forest Service Fund, as a 
National Forest receipt of the fiscal year in which such transfer is 
made.
    (d) User Fees.--The Secretary of Agriculture is authorized to 
charge reasonable fees for the admission, occupancy, and use of the 
Midewin National Tallgrass Prairie and may prescribe a fee schedule 
providing for reduced, or a waiver of, fees for persons or groups 
engaged in authorized activities including those providing volunteer 
services, research, or education. The Secretary shall permit admission, 
occupancy, and use at no additional charge for persons possessing a 
valid Golden Eagle Passport or Golden Age Passport.
    (e) Salvage of Improvements.--The Secretary of Agriculture may sell 
for salvage value any facilities and improvements which have been 
transferred to the Secretary pursuant to this subtitle.
    (f) Treatment of User Fees and Salvage Receipts.--Monies collected 
pursuant to subsections (d) and (e) shall be covered into the Treasury 
and constitute a special fund to be known as the Midewin National 
Tallgrass Prairie Restoration Fund. Deposits in the Midewin National 
Tallgrass Prairie Restoration Fund shall be available to the Secretary 
of Agriculture, in such amounts as are provided in advance in 
appropriation Acts, for restoration and administration of the Midewin 
National Tallgrass Prairie, including construction of a visitor and 
education center, restoration of ecosystems, construction of 
recreational facilities (such as trails), construction of 
administrative offices, and operation and maintenance of the MNP.

SEC. 10316. SPECIAL DISPOSAL RULES FOR CERTAIN ARSENAL PARCELS INTENDED 
                    FOR MNP.

    (a) Description of Parcels.--Except as provided in subsection (b), 
the following areas are designated for transfer or disposal pursuant to 
subsection (c):
            (1) Manufacturing Area--Study Area 1--Southern Ash Pile, 
        Study Area 2--Explosive Burning Ground, Study Area 3--Flashing 
        Grounds, Study Area 4--Lead Azide Area, Study Area 10--Toluene 
        Tank Farms, Study Area 11--Landfill, Study Area 12--Sellite 
        Manufacturing Area, Study Area 14--Former Pond Area, Study Area 
        15--Sewage Treatment Plant.
            (2) Load Assemble Packing Area--Group 61: Study Area L1, 
        Explosive Burning Ground: Study Area L2, Demolition Area: Study 
        Area L3, Landfill Area: Study Area L4, Salvage Yard: Study Area 
        L5, Group 1: Study Area L7, Group 2: Study Area L8, Group 3: 
        Study Area L9, Group 3A: Study Area L10, Group 4: Study Area 
        L14, Group 5: Study Area L15, Group 8: Study Area L18, Group 9: 
        Study Area L19, Group 27: Study Area L23, Group 62: Study Area 
        L25, PVC Area: Study Area L33, including all associated 
        inventoried buildings and structures as identified in the 
        Joliet Army Ammunition Plant Plantwide Building and Structures 
        Report and the contaminate study sites for both the 
        Manufacturing and Load Assembly and Packing sides of the Joliet 
        Arsenal as delineated in the Dames and Moore Final Report, 
        Proposed Future Land Use Map, dated May 30, 1995.
    (b) Exception.--The parcels described in subsection (a) shall not 
include the property at the Arsenal designated for disposal under 
chapter 3.
    (c) Initial Offer to Secretary of Agriculture.--Within 6 months 
after the construction and installation of any remedial design approved 
by the Administrator and required for any lands described in subsection 
(a), the Administrator shall provide to the Secretary of Agriculture 
all existing information regarding the implementation of such remedy, 
including information regarding its effectiveness. Within 3 months 
after the Administrator provides such information to the Secretary of 
Agriculture, the Secretary of the Army shall offer the Secretary of 
Agriculture the option of accepting a transfer of the areas described 
in subsection (a), without reimbursement, to be added to the Midewin 
National Tallgrass Prairie and subject to the terms and conditions, 
including the limitations on liability, contained in this subtitle. In 
the event the Secretary of Agriculture declines such offer, the 
property may be disposed of as the Secretary of the Army would 
ordinarily dispose of such property under applicable provisions of law. 
Any sale or other transfer of property conducted pursuant to this 
subsection may be accomplished on a parcel-by-parcel basis.

    CHAPTER 3--OTHER REAL PROPERTY DISPOSALS INVOLVING JOLIET ARMY 
                            AMMUNITION PLANT

SEC. 10321. DISPOSAL OF CERTAIN REAL PROPERTY AT ARSENAL FOR A NATIONAL 
                    CEMETERY.

    (a) Transfer Required.--Subject to section 10331, the Secretary of 
the Army shall transfer, without reimbursement, to the Secretary of 
Veterans Affairs the parcel of real property at the Arsenal described 
in subsection (b) for use as a national cemetery.
    (b) Description of Property.--The real property to be transferred 
under subsection (a) is a parcel of real property at the Arsenal 
consisting of approximately 982 acres, the approximate legal 
description of which includes part of sections 30 and 31 Jackson 
Township, T34N R10E, and part of sections 25 and 36 Channahon Township, 
T34N R9E, Will County, Illinois, as depicted in the Arsenal Land Use 
Concept.
    (c) Security Measures.--The Secretary of Veterans Affairs shall 
provide and maintain physical and other security measures on the real 
property transferred under subsection (a). Such security measures 
(which may include fences and natural barriers) shall include measures 
to prevent members of the public from gaining unauthorized access to 
the portion of the Arsenal that is under the administrative 
jurisdiction of the Secretary of Veterans Affairs and that may endanger 
health or safety.
    (d) Surveys.--All costs of necessary surveys for the transfer of 
jurisdiction of Arsenal properties from the Secretary of the Army to 
the Secretary of Veterans Affairs shall be borne solely by the 
Secretary of Veterans Affairs.

SEC. 10322. DISPOSAL OF CERTAIN REAL PROPERTY AT ARSENAL FOR A COUNTY 
                    LANDFILL.

    (a) Transfer Required.--Subject to section 10331, the Secretary of 
the Army shall transfer, without compensation, to Will County, 
Illinois, all right, title, and interest of the United States in and to 
the parcel of real property at the Arsenal described in subsection (b), 
which shall be operated as a landfill by the County.
    (b) Description of Property.--The real property to be transferred 
under subsection (a) is a parcel of real property at the Arsenal 
consisting of approximately 455 acres, the approximate legal 
description of which includes part of sections 8 and 17, Florence 
Township, T33N R10E, Will County, Illinois, as depicted in the Arsenal 
Land Use Concept.
    (c) Condition on Conveyance.--The conveyance shall be subject to 
the condition that the Army (or its agents or assigns) may use the 
landfill established on the real property transferred under subsection 
(a) for the disposal of construction debris, refuse, and other 
nonhazardous materials from the restoration and cleanup of the Arsenal 
property as provided for in this Act. Such use shall be at no cost to 
the Federal Government.
    (d) Reversionary Interest.--During the 5-year period beginning on 
the date the Secretary of the Army makes the conveyance under 
subsection (a), if the Secretary of the Army determines that the 
conveyed real property is not being operated as a landfill or that Will 
County, Illinois, is in violation of the condition specified in 
subsection (c), then, at the option of the United States, all right, 
title, and interest in and to the property, including improvements 
thereon, shall be subject to reversion to the United States. In the 
event the United States exercises its option to cause the property to 
revert, the United States shall have the right of immediate entry onto 
the property. Any determination of the Secretary of the Army under this 
subsection shall be made on the record after an opportunity for a 
hearing.
    (e) Surveys.--All costs of necessary surveys for the transfer of 
real property under this section shall be borne by Will County, 
Illinois.
    (f) Additional Terms and Conditions.--The Secretary of the Army may 
require such additional terms and conditions in connection with the 
conveyance under this section as the Secretary of the Army considers 
appropriate to protect the interests of the United States.

SEC. 10323. DISPOSAL OF CERTAIN REAL PROPERTY AT ARSENAL FOR ECONOMIC 
                    DEVELOPMENT.

    (a) Transfer Required.--Subject to section 10331, the Secretary of 
the Army shall transfer to the State of Illinois, all right, title, and 
interest of the United States in and to the parcel of real property at 
the Arsenal described in subsection (b), which shall be used for 
economic redevelopment to replace all or a part of the economic 
activity lost at the Arsenal.
    (b) Description of Property.--The real property to be transferred 
under subsection (a) is a parcel of real property at the Arsenal 
consisting of--
            (1) approximately 1,900 acres, the approximate legal 
        description of which includes part of section 30, Jackson 
        Township, Township 34 North, Range 10 East, and sections or 
        parts of sections 24, 25, 26, 35, and 36, Township 34 North, 
        Range 9 East, in Channahon Township, an area of 9.77 acres 
        around the Des Plaines River Pump Station located in the 
        southeast quarter of section 15, Township 34 North, Range 9 
        East of the Third Principal Meridian, in Channahon Township, 
        and an area of 511 feet by 596 feet around the Kankakee River 
        Pump Station in the Northwest Quarter of section 5, Township 33 
        North, Range 9 East, east of the Third Principal Meridian in 
        Wilmington Township, containing 6.99 acres, located along the 
        easterly side of the Kankakee Cut-Off in Will County, Illinois, 
        as depicted in the Arsenal Re-Use Concept, and the connecting 
        piping to the northern industrial site, as described by the 
        United States Army Report of Availability, dated 13 December 
        1993; and
            (2) approximately 1,100 acres, the approximate legal 
        description of which includes part of sections 16, 17, 18 
        Florence Township, Township 33 North, Range 10 East, Will 
        County, Illinois, as depicted in the Arsenal Land Use Concept.
    (c) Consideration.--The transfer under subsection (a) shall be made 
without consideration. However, the transfer shall be subject to the 
condition that, if the State of Illinois reconveys all or any part of 
the transferred property to a non-Federal entity, the State shall pay 
to the United States an amount equal to the fair market value of the 
reconveyed property. The Secretary of the Army shall determine the fair 
market value of any property reconveyed by the State as of the time of 
the reconveyance, excluding the value of improvements made to the 
property by the State. The Secretary may treat a lease of the property 
as a reconveyance if the Secretary determines that the lease was used 
in an effort to avoid operation of this subsection. Amounts received 
under this subsection shall be deposited in the general fund of the 
Treasury for purposes of deficit reduction.
    (d) Other Conditions of Conveyance.--
            (1) Redevelopment authority.--The transfer under subsection 
        (a) shall be subject to the further condition that the Governor 
        of the State of Illinois establish a redevelopment authority to 
        be responsible for overseeing the economic redevelopment of the 
        transferred land.
            (2) Time for establishment.--To satisfy the condition 
        specified in paragraph (1), the redevelopment authority shall 
        be established within 1 year after the date of the enactment of 
        this Act.
    (e) Reversionary Interest.--During the 20-year period beginning on 
the date the Secretary of the Army makes the transfer under subsection 
(a), if the Secretary determines that a condition specified in 
subsection (c) or (d) is not being satisfied or that the transferred 
land is not being used for economic development purposes, then, at the 
option of the United States, all right, title, and interest in and to 
the property, including improvements thereon, shall be subject to 
reversion to the United States. In the event the United States 
exercises its option to cause the property to revert, the United States 
shall have the right of immediate entry onto the property. Any 
determination of the Secretary under this subsection shall be made on 
the record after an opportunity for a hearing.
    (f) Surveys.--All costs of necessary surveys for the transfer of 
real property under this section shall be borne by the State of 
Illinois.
    (g) Additional Terms and Conditions.--The Secretary of the Army may 
require such additional terms and conditions in connection with the 
transfer under this section as the Secretary considers appropriate to 
protect the interests of the United States.

                  CHAPTER 4--MISCELLANEOUS PROVISIONS

SEC. 10331. DEGREE OF ENVIRONMENTAL CLEANUP.

    (a) In General.--Nothing in this Act shall be construed to restrict 
or lessen the degree of cleanup at the Arsenal required to be carried 
out under provisions of any environmental law.
    (b) Response Action.--The establishment of the Midewin National 
Tallgrass Prairie under chapter 2 and the additional real property 
transfers and disposals required under chapter 3 shall not restrict or 
lessen in any way any response action or degree of cleanup under CERCLA 
or other environmental law, or any response action required under any 
environmental law to remediate petroleum products or their derivatives 
(including motor oil and aviation fuel), required to be carried out 
under the authority of the Secretary of the Army at the Arsenal and 
surrounding areas, except to the extent otherwise allowable under such 
laws.
    (c) Environmental Quality of Property.--Any contract for sale, 
deed, or other transfer of real property under chapter 3 shall be 
carried out in compliance with all applicable provisions of section 
120(h) of CERCLA and other environmental laws.

                  Subtitle D--Miscellaneous Provisions

SEC. 10401. EXTENSION OF HIGHER VESSEL TONNAGE DUTIES.

    (a) Extension of Duties.--Section 36 of the Act of August 5, 1909 
(36 Stat. 111; 46 App. U.S.C. 121), is amended by striking ``for fiscal 
years 1991, 1992, 1993, 1994, 1995, 1996, 1997, 1998,'' each place it 
appears and inserting ``for fiscal years through fiscal year 2002,''.
    (b) Conforming Amendment.--The Act entitled ``An Act concerning 
tonnage duties on vessels entering otherwise than by sea'', approved 
March 8, 1910 (36 Stat. 234; 46 App. U.S.C. 132), is amended by 
striking ``for fiscal years 1991, 1992, 1993, 1994, 1995, 1996, 1997, 
and 1998,'' and inserting ``for fiscal years through fiscal year 
2002,''.

SEC. 10402. SALE OF GOVERNORS ISLAND, NEW YORK.

    (a) In General.--Notwithstanding any other provision of law, the 
Administrator of General Services shall dispose of by sale at fair 
market value all rights, title, and interests of the United States in 
and to the land of, and improvements to, Governors Island, New York.
    (b) Right of First Refusal.--Before a sale is made under subsection 
(a) to any other parties, the State of New York and the city of New 
York shall be given the right of first refusal to purchase all or part 
of Governors Island. Such right may be exercised by either the State of 
New York or the city of New York or by both parties acting jointly.
    (c) Proceeds.--Proceeds from the disposal of Governors Island under 
subsection (a) shall be deposited in the general fund of the Treasury 
and credited as miscellaneous receipts.

SEC. 10403. SALE OF AIR RIGHTS.

    (a) In General.--Notwithstanding any other provision of law, the 
Administrator of General Services shall sell, at fair market value and 
in a manner to be determined by the Administrator, the air rights 
adjacent to Washington Union Station described in subsection (b), 
including air rights conveyed to the Administrator under subsection 
(d). The Administrator shall complete the sale by such date as is 
necessary to ensure that the proceeds from the sale will be deposited 
in accordance with subsection (c).
    (b) Description.--The air rights referred to in subsection (a) 
total approximately 16.5 acres and are depicted on the plat map of the 
District of Columbia as follows:
            (1) Part of lot 172, square 720.
            (2) Part of lots 172 and 823, square 720.
            (3) Part of lot 811, square 717.
    (c) Proceeds.--Before September 30, 1996, proceeds from the sale of 
air rights under subsection (a) shall be deposited in the general fund 
of the Treasury and credited as miscellaneous receipts.
    (d) Conveyance of Amtrak Air Rights.--
            (1) General rule.--As a condition of future Federal 
        financial assistance, Amtrak shall convey to the Administrator 
        of General Services on or before December 31, 1995, at no 
        charge, all of the air rights of Amtrak described in subsection 
        (b).
            (2) Failure to comply.--If Amtrak does not meet the 
        condition established by paragraph (1), Amtrak shall be 
        prohibited from obligating Federal funds after March 1, 1996.

SEC. 10404. COLLECTION OF PARKING FEES.

    (a) In General.--The Administrator of General Services shall issue 
regulations requiring each Executive agency to collect fees for the use 
of all parking facilities provided for the agency at Federal expense.
    (b) Specific Requirements.--The regulations--
            (1) shall include provisions under which any such user fee 
        shall be computed based on the fair market value of the use of 
        the parking facility involved; and
            (2) shall take effect on or before the 90th day after the 
        date of enactment of this Act.
    (c) Fees To Be Deposited in the Treasury.--All user fees collected 
under this section shall be deposited in the Treasury of the United 
States as miscellaneous receipts.
    (d) Prohibition on Use of Federal Funds.--No Federal funds may be 
used to pay any user fee collected under this section.
    (e) Executive Agency Defined.--In this section, the term 
``Executive agency'' has the meaning given such term by section 105 of 
title 5, United States Code.

    Subtitle E--Economic Development Administration and Appalachian 
                          Regional Commission

SEC. 10501. SHORT TITLE; EFFECTIVE DATE.

    (a) Short Title.--This subtitle may be cited as the ``Economic 
Development Partnership Act of 1995''.
    (b) Effective Date.--Except as otherwise expressly provided, this 
subtitle and the amendments made by this subtitle shall take effect 6 
months after the date of the enactment of this Act.

CHAPTER 1--TRANSFER OF FUNCTIONS OF ECONOMIC DEVELOPMENT ADMINISTRATION

SEC. 10511. REAUTHORIZATION OF PUBLIC WORKS AND ECONOMIC DEVELOPMENT 
                    ACT OF 1965.

    The Public Works and Economic Development Act of 1965 (40 U.S.C. 
3131 et seq.) is amended by striking all after the first section and 
inserting the following:

``SEC. 2. FINDINGS AND DECLARATION.

    ``(a) Findings.--Congress finds that--
            ``(1) the maintenance of the national economy at a high 
        level is vital to the best interests of the United States, but 
        that some of our regions, counties, and communities are 
        suffering substantial and persistent unemployment and 
        underemployment that cause hardship to many individuals and 
        their families, and waste invaluable human resources;
            ``(2) to overcome this problem the Federal Government, in 
        cooperation with the States, should help areas and regions of 
        substantial and persistent unemployment and underemployment to 
        take effective steps in planning and financing their public 
        works and economic development;
            ``(3) Federal financial assistance, including grants for 
        public works and development facilities to communities, 
        industries, enterprises, and individuals in areas needing 
        development should enable such areas to help themselves achieve 
        lasting improvement and enhance the domestic prosperity by the 
        establishment of stable and diversified local economies and 
        improved local conditions, if such assistance is preceded by 
        and consistent with sound, long-range economic planning; and
            ``(4) under the provisions of this Act, new employment 
        opportunities should be created by developing and expanding new 
        and existing public works and other facilities and resources 
        rather than by merely transferring jobs from one area of the 
        United States to another.
    ``(b) Declaration.--Congress declares that, in furtherance of 
maintaining the national economy at a high level--
            ``(1) the assistance authorized by this Act should be made 
        available to both rural and urban areas;
            ``(2) such assistance should be made available for planning 
        for economic development prior to the actual occurrences of 
        economic distress in order to avoid such condition; and
            ``(3) such assistance should be used for long-term economic 
        rehabilitation in areas where long-term economic deterioration 
        has occurred or is taking place.

               ``TITLE I--ECONOMIC DEVELOPMENT COMMISSION

``SEC. 101. ESTABLISHMENT OF ECONOMIC DEVELOPMENT COMMISSION.

    ``(a) Establishment.--There is established an Economic Development 
Commission which shall be an independent establishment in the executive 
branch.
    ``(b) Appointment of Federal Cochairman.--The Commission shall 
headed by a Federal Cochairman of the Economic Development Commission 
(hereinafter in this Act referred to as the `Federal Cochairman') who 
shall be appointed by the President by and with the advice and consent 
of the Senate.
    ``(c) Duties.--It shall be the duty of the Federal Cochairman to 
carry out duties vested in the Federal Cochairman under this Act.

``SEC. 102. ESTABLISHMENT OF REGIONAL COMMISSIONS.

    ``(a) Establishment.--The Federal Cochairman shall establish for 
each region established by section 106 an Economic Development Regional 
Commission (hereinafter in this Act referred to as a `Regional 
Commission').
    ``(b) Membership.--
            ``(1) In general.--Each Regional Commission shall be 
        composed of 1 Federal member and 1 State member from each 
        participating State in the region represented by the Regional 
        Commission.
            ``(2) Federal cochairman.--The Federal member of each 
        Regional Commission shall be the Federal Cochairman.
            ``(3) State members.--Each State member of a Regional 
        Commission shall be the chief executive officer of the State. 
        The State members of a Regional Commission shall elect a 
        Cochairman from among such State members for a term of not less 
        than 1 year.
            ``(4) Alternates.--
                    ``(A) State alternates.--Each State member of a 
                Regional Commission may have a single alternate 
                appointed by the chief executive officer of the State 
                from among members of the chief executive officer's 
                cabinet or the chief executive officer's personal 
                staff.
                    ``(B) Federal alternate.--The President, by and 
                with the advice and consent of the Senate, shall 
                appoint an alternate for the Federal Cochairman.
                    ``(C) Duties.--An alternate shall vote in the event 
                of the absence, death, disability, removal, or 
                resignation of the State or Federal representative for 
                which he or she is an alternate. A State alternate 
                shall not be counted toward the establishment of a 
                quorum of the Commission in any instance in which a 
                quorum of the State members is required to be present.
    ``(c) Decisionmaking.--
            ``(1) Voting.--Decisions by a Regional Commission shall 
        require an affirmative vote of the Federal Cochairman (or the 
        Federal Cochairman's alternate) and of the majority of the 
        State members.
            ``(2) Quorum.--No decision of a Regional Commission 
        involving Commission policy, developing investment strategies, 
        or allocating funds among States may be made without the 
        Federal Cochairman (or the Federal Cochairman's alternate) and 
        a quorum of the State members present. For purposes of this 
        Act, the Federal Cochairman (or the Federal Cochairman's 
        alternate) and a majority of the State members shall constitute 
        a quorum.
    ``(d) Pay.--
            ``(1) Federal cochairman.--The Federal Cochairman shall be 
        compensated by the Federal Government at the rate prescribed 
        for level III of the Executive Schedule under section 5314 of 
        title 5, United States Code.
            ``(2) Federal cochairman's alternate.--The Federal 
        Cochairman's alternate shall be compensated by the Federal 
        Government at the rate prescribed for level V of the Executive 
        Schedule under section 5316 of title 5, United States Code, and 
        when not serving as an alternate for the Federal Cochairman 
        shall perform such functions and duties as are delegated by the 
        Federal Cochairman.
            ``(3) State members and their alternates.--Each State 
        member and the State member's alternate shall be compensated by 
        the State which they represent at the rate established by law 
        of such State.

``SEC. 103. COOPERATION OF FEDERAL AGENCIES.

    ``Each Federal department and agency, in accordance with applicable 
laws and within the limits of available funds, shall cooperate with 
each Regional Commission in order to assist the Regional Commission in 
carrying out the functions of the Regional Commission.

``SEC. 104. ADMINISTRATIVE EXPENSES.

    ``(a) Payment by States.--Fifty percent of the administrative 
expenses of a Regional Commission (other than the expenses of the 
Federal Cochairman) shall be paid by the States in the region 
represented by the Regional Commission and the remaining 50 percent of 
such expenses shall be paid by the Federal Government. The expenses of 
the Federal Cochairman, the Federal Cochairman's alternate, and the 
Federal Cochairman's staff shall be paid solely by the Federal 
Government.
    ``(b) Determination of State Share.--The share of the 
administrative expenses to be paid by each State shall be determined by 
the Regional Commission. The Federal Cochairman shall not participate 
or vote in such determination.
    ``(c) Delinquent Payments.--No assistance authorized by this Act 
shall be furnished to any State or to any political subdivision or 
resident of a State, nor shall the State member of a Regional 
Commission participate or vote in any determination by the Regional 
Commission, while such State is delinquent in the payment of such 
State's share of the administrative expenses of the Regional 
Commission.

``SEC. 105. ADMINISTRATIVE POWERS.

    ``To carry out its duties under this Act, consistent with 
regulations issued by the Federal Cochairman, a Regional Commission may 
take any of the following actions:
            ``(1) Adopt, amend, and repeal bylaws and rules governing 
        the conduct of the Regional Commission's business and the 
        performance of its functions.
            ``(2) Appoint and fix the pay of an executive director and 
        such other personnel as may be necessary to enable the Regional 
        Commission to carry out its functions; except that the 
        compensation for any individual so appointed shall not exceed 
        the rate of basic pay for level V of the Executive Schedule and 
        no member, officer, or employee of the Regional Commission, 
        other than the Federal Cochairman, the Federal Cochairman's 
        alternate, employees of the Federal Cochairman, and any Federal 
        employees detailed under paragraph (3), shall be deemed a 
        Federal employee for any purpose.
            ``(3) Request the head of a Federal department or agency to 
        detail to temporary duty with the Regional Commission such 
        personnel within the administrative jurisdiction of such head 
        as the Regional Commission may need for carrying out its 
        functions, and each such detail shall be without loss of 
        seniority, pay, or other employee status.
            ``(4) Arrange for the services of personnel from any State 
        or local government or any subdivision or agency thereof, or 
        any intergovernmental agency.
            ``(5) Make arrangements, including contracts, with any 
        participating State government for inclusion in a suitable 
        retirement and employee benefits system of such of its 
        personnel as may not be eligible for, or continue in, another 
        governmental retirement or employee benefit system, or 
        otherwise provide for such coverage of its personnel. The 
        Director of the Office of Personnel Management is authorized to 
        contract with a Regional Commission for continued coverage of 
        any Regional Commission employee who, on a date in the 6-month 
        period ending on the date of Regional Commission employment, 
        was a Federal employee, in the retirement program and other 
        employee benefit programs of the Federal Government.
            ``(6) Accept, use, and dispose of gifts or donations of 
        services or property, real, personal, or mixed, tangible or 
        intangible.
            ``(7) Subject to the requirements of the Federal Property 
        and Administrative Services Act of 1949, enter into and perform 
        such contracts, leases, cooperative agreements, or other 
        transactions as may be necessary in carrying out the Regional 
        Commission's functions and on such terms as the Regional 
        Commission may deem appropriate, with any department, agency, 
        or instrumentality of the United States, or with any person, 
        firm, association, or corporation.
            ``(8) Take such other actions and incur such other expenses 
        as may be necessary and appropriate.

``SEC. 106. ESTABLISHMENT OF REGIONS.

    ``(a) In General.--For the purposes of this Act, there are 
established 8 regions of the United States as follows:
            ``(1) Region I.--Region I shall be composed of the States 
        of Alabama, Florida, Georgia, Kentucky, Mississippi, North 
        Carolina, South Carolina, and Tennessee.
            ``(2) Region II.--Region II shall be composed of the States 
        of Arkansas, Louisiana, New Mexico, Oklahoma, and Texas.
            ``(3) Region III.--Region III shall be composed of the 
        States of Illinois, Indiana, Michigan, Minnesota, Ohio, and 
        Wisconsin.
            ``(4) Region IV.--Region IV shall be composed of the States 
        of Colorado, Iowa, Kansas, Missouri, Montana, Nebraska, North 
        Dakota, South Dakota, Utah, and Wyoming.
            ``(5) Region V.--Region V shall be composed of the State of 
        California.
            ``(6) Region VI.--Region VI shall be composed of the States 
        of Alaska, Arizona, Hawaii, Idaho, Nevada, Oregon, and 
        Washington and American Samoa, Guam, the Marshall Islands, 
        Micronesia, and the Northern Mariana Islands.
            ``(7) Region VII.--Region VII shall be composed of the 
        States of Delaware, Maryland, New Jersey, New York, 
        Pennsylvania, Virginia, and West Virginia and the District of 
        Columbia.
            ``(8) Region VIII.--Region VIII shall be composed of the 
        States of Connecticut, Maine, Massachusetts, New Hampshire, 
        Rhode Island, and Vermont and Puerto Rico and the Virgin 
        Islands.
    ``(b) Participation Not Required.--No State shall be required to 
participate in any program under this Act.

     ``TITLE II--GRANTS FOR PUBLIC WORKS AND DEVELOPMENT FACILITIES

``SEC. 201. DIRECT AND SUPPLEMENTARY GRANTS.

    ``(a) In General.--Upon the application of any eligible recipient, 
a Regional Commission may--
            ``(1) make direct grants for the acquisition or development 
        of land and improvements for public works, public service, or 
        development facility usage, and the acquisition, design and 
        engineering, construction, rehabilitation, alteration, 
        expansion, or improvement of such facilities, including related 
        machinery and equipment, within an area described in section 
        502(a), if the Regional Commission finds that--
                    ``(A) the project for which financial assistance is 
                sought will directly or indirectly--
                            ``(i) tend to improve the opportunities, in 
                        the area where such project is or will be 
                        located, for the successful establishment or 
                        expansion of industrial or commercial plants or 
                        facilities;
                            ``(ii) otherwise assist in the creation of 
                        additional long-term employment opportunities 
                        for such area; or
                            ``(iii) primarily benefit the long-term 
                        unemployed and members of low-income families;
                    ``(B) the project for which a grant is requested 
                will fulfill a pressing need of the area, or part 
                thereof, in which it is, or will be, located;
                    ``(C) the area for which a project is to be 
                undertaken has an approved investment strategy as 
                provided by section 503 and such project is consistent 
                with such strategy; and
                    ``(D) in the case of an area described in section 
                502(a)(4), the project to be undertaken will provide 
                immediate useful work to unemployed and underemployed 
                persons in that area; and
            ``(2) make supplementary grants in order to enable the 
        States and other entities within areas described in section 
        502(a) to take maximum advantage of designated Federal grant-
        in-aid programs (as defined in subsection (c)(4)), direct 
        grants-in-aid authorized under this section, and Federal grant-
        in-aid programs authorized by the Watershed Protection and 
        Flood Prevention Act (68 Stat. 666), and the 11 watersheds 
        authorized by the Flood Control Act of December 22, 1944 (58 
        Stat. 887), for which they are eligible but for which, because 
        of their economic situation, they cannot supply the required 
        matching share.
    ``(b) Cost Sharing.--Subject to subsection (c), the amount of any 
direct grant under this subsection for any project shall not exceed 50 
percent of the cost of such project.
    ``(c) Requirements Applicable to Supplementary Grants.--
            ``(1) Amount of supplementary grants.--
                    ``(A) In general.--Except as provided by 
                subparagraph (B), the amount of any supplementary grant 
                under this section for any project shall not exceed the 
                applicable percentage established by regulations 
                promulgated by the Federal Cochairman, but in no event 
                shall the non-Federal share of the aggregate cost of 
                any such project (including assumptions of debt) be 
                less than 20 percent of such cost.
                    ``(B) Exceptions.--Notwithstanding subparagraph 
                (A)--
                            ``(i) in the case of a grant to an Indian 
                        tribe, a Regional Commission may reduce the 
                        non-Federal share below the percentage 
                        specified in subparagraph (A) or may waive the 
                        non-Federal share;
                            ``(ii) in the case of any State or a 
                        political subdivision of the State which the 
                        Regional Commission determines has exhausted 
                        its effective taxing and borrowing capacity, 
                        the Regional Commission shall reduce the non-
                        Federal share below the percentage specified in 
                        subparagraph (A) or shall waive the non-Federal 
                        share in the case of such a grant for a project 
                        in an area described in section 502(a)(4); and
                            ``(iii) in case of any community 
                        development corporation which the Regional 
                        Commission determines has exhausted its 
                        effective borrowing capacity, the Regional 
                        Commission may reduce the non-Federal share 
                        below the percentage specified in subparagraph 
                        (A) or waive the non-Federal share in the case 
                        of such a grant for a project in an area 
                        described in section 502(a)(4).
            ``(2) Form of supplementary grants.--Supplementary grants 
        shall be made by a Regional Commission, in accordance with such 
        regulations as the Federal Cochairman may prescribe, by 
        increasing the amounts of direct grants authorized under this 
        section or by the payment of funds appropriated under this Act 
        to the heads of the departments, agencies, and 
        instrumentalities of the Federal Government responsible for the 
        administration of the applicable Federal programs.
            ``(3) Federal share limitations specified in other laws.--
        Notwithstanding any requirement as to the amount or sources of 
        non-Federal funds that may otherwise be applicable to the 
        Federal program involved, funds provided under this subsection 
        shall be used for the sole purpose of increasing the Federal 
        contribution to specific projects in areas described in section 
        502(a) under such programs above the fixed maximum portion of 
        the cost of such project otherwise authorized by the applicable 
        law.
            ``(4) Designated federal grant-in-aid programs defined.--In 
        this subsection, the term `designated Federal grant-in-aid 
        programs' means such existing or future Federal grant-in-aid 
        programs assisting in the construction or equipping of 
        facilities as the Federal Cochairman may, in furtherance of the 
        purposes of this Act, designate as eligible for allocation of 
        funds under this section.
            ``(5) Consideration of relative need in determining 
        amount.--In determining the amount of any supplementary grant 
        available to any project under this section, a Regional 
        Commission shall take into consideration the relative needs of 
        the area and the nature of the projects to be assisted.
    ``(d) Regulations.--The Federal Cochairman shall prescribe rules, 
regulations, and procedures to carry out this section which will assure 
that adequate consideration is given to the relative needs of eligible 
areas. In prescribing such rules, regulations, and procedures the 
Federal Cochairman shall consider among other relevant factors--
            ``(1) the severity of the rates of unemployment in the 
        eligible areas and the duration of such unemployment; and
            ``(2) the income levels of families and the extent of 
        underemployment in eligible areas.
    ``(e) Review and Comment Upon Projects by Local Governmental 
Authorities.--The Federal Cochairman shall prescribe regulations which 
will assure that appropriate local governmental authorities have been 
given a reasonable opportunity to review and comment upon proposed 
projects under this section.

``SEC. 202. CONSTRUCTION COST INCREASES.

    ``In any case where a grant (including a supplemental grant) has 
been made by a Regional Commission under this title for a project and 
after such grant has been made but before completion of the project, 
the cost of such project based upon the designs and specifications 
which were the basis of the grant has been increased because of 
increases in costs, the amount of such grant may be increased by an 
amount equal to the percentage increase, as determined by the Regional 
Commission, in such costs, but in no event shall the percentage of the 
Federal share of such project exceed that originally provided for in 
such grant.

``SEC. 203. USE OF FUNDS IN PROJECTS CONSTRUCTED UNDER PROJECTED COST.

    ``In any case where a grant (including a supplemental grant) has 
been made by a Regional Commission under this title for a project, and 
after such grant has been made but before completion of the project, 
the cost of such project based upon the designs and specifications 
which were the basis of the grant has decreased because of decreases in 
costs, such underrun funds may be used to improve the project either 
directly or indirectly as determined by the Regional Commission.

``SEC. 204. CHANGED PROJECT CIRCUMSTANCES.

    ``In any case where a grant (including a supplemental grant) has 
been made by a Regional Commission under this title for a project, and 
after such grant has been made but before completion of the project, 
the purpose or scope of such project based upon the designs and 
specifications which were the basis of the grant has changed, the 
Regional Commission may approve the use of grant funds on such changed 
project if the Regional Commission determines that such changed project 
meets the requirements of this title and that such changes are 
necessary to enhance economic development in the area.

  ``TITLE III--SPECIAL ECONOMIC DEVELOPMENT AND ADJUSTMENT ASSISTANCE

``SEC. 301. STATEMENT OF PURPOSE.

    ``The purpose of this title to provide special economic development 
and adjustment assistance programs to help State and local areas meet 
special needs arising from actual or threatened severe unemployment 
arising from economic dislocation, including unemployment arising from 
actions of the Federal Government and from compliance with 
environmental requirements which remove economic activities from a 
locality, and economic adjustment problems resulting from severe 
changes in economic conditions (including long-term economic 
deterioration), and to encourage cooperative intergovernmental action 
to prevent or solve economic adjustment problems. Nothing in this title 
is intended to replace the efforts of the economic adjustment program 
of the Department of Defense.

``SEC. 302. GRANTS BY REGIONAL COMMISSIONS.

    ``(a) In General.--A Regional Commission is authorized to make 
grants directly to any eligible recipient in an area which the Regional 
Commission determines, in accordance with criteria to be established by 
the Federal Cochairman by regulation--
            ``(1) has experienced, or may reasonably be foreseen to be 
        about to experience, a special need to meet an expected rise in 
        unemployment, or other economic adjustment problems (including 
        those caused by any action or decision of the Federal 
        Government); or
            ``(2) has demonstrated long-term economic deterioration.
    ``(b) Purposes.--Amounts from grants under subsection (a) shall be 
used by an eligible recipient to carry out or develop an investment 
strategy which--
            ``(1) meets the requirements of section 503; and
            ``(2) is approved by the Regional Commission.
    ``(c) Types of Assistance.--In carrying out an investment strategy 
using amounts from grants under subsection (a), an eligible recipient 
may provide assistance for any of the following:
            ``(1) Public facilities.
            ``(2) Public services.
            ``(3) Business development.
            ``(4) Planning.
            ``(5) Research and technical assistance.
            ``(6) Administrative expenses.
            ``(7) Training.
            ``(8) Relocation of individuals and businesses.
            ``(9) Other assistance which demonstrably furthers the 
        economic adjustment objectives of this title.
    ``(d) Direct Expenditure or Redistribution by Recipient.--Amounts 
from grants under subsection (a) may be used in direct expenditures by 
the eligible recipient or through redistribution by the eligible 
recipient to public and private entities in grants, loans, loan 
guarantees, payments to reduce interest on loan guarantees, or other 
appropriate assistance, but no grant shall be made by an eligible 
recipient to a private profit-making entity.
    ``(e) Coordination.--A Regional Commission to the extent 
practicable shall coordinate the activities relating to the 
requirements for investment strategies and making grants and loans 
under this title with other Federal programs, States, economic 
development districts, and other appropriate planning and development 
organizations.
    ``(f) Base Closings and Realignments.--
            ``(1) Location of projects.--In any case in which a 
        Regional Commission determines a need for assistance under 
        subsection (a) due to the closure or realignment of a military 
        installation, the Regional Commission may make such assistance 
        available for projects to be carried out on the military 
        installation and for projects to be carried out in communities 
        adversely affected by the closure or realignment.
            ``(2) Interest in property.--Notwithstanding any other 
        provision of law, a Regional Commission may provide to an 
        eligible recipient any assistance available under this Act for 
        a project to be carried out on a military installation that is 
        closed or scheduled for closure or realignment without 
        requiring that the eligible recipient have title to the 
        property or a leasehold interest in the property for any 
        specified term.

``SEC. 303. ANNUAL REPORTS BY RECIPIENT.

    ``Each eligible recipient which receives assistance under this 
title from a Regional Commission shall annually during the period such 
assistance continue to make a full and complete report to the Regional 
Commission, in such manner as the Regional Commission shall prescribe, 
and such report shall contain an evaluation of the effectiveness of the 
economic assistance provided under this title in meeting the need it 
was designed to alleviate and the purposes of this title.

``SEC. 304. SALE OF FINANCIAL INSTRUMENTS IN REVOLVING LOAN FUNDS.

    ``Any loan, loan guarantee, equity, or other financial instrument 
in the portfolio of a revolving loan fund, including any financial 
instrument made available using amounts from a grant made before the 
effective date of the Economic Development Partnership Act of 1995, may 
be sold, encumbered, or pledged at the discretion of the grantee of the 
Fund, to a third party provided that the net proceeds of the 
transaction--
            ``(1) shall be deposited into the Fund and may only be used 
        for activities which are consistent with the purposes of this 
        title; and
            ``(2) shall be subject to the financial management, 
        accounting, reporting, and auditing standards which were 
        originally applicable to the grant.

``SEC. 305. TREATMENT OF REVOLVING LOAN FUNDS.

    ``(a) In General.--Amounts from grants made under this title which 
are used by an eligible recipient to establish a revolving loan fund 
shall not be treated, except as provided by subsection (b), as amounts 
derived from Federal funds for the purposes of any Federal law after 
such amounts are loaned from the fund to a borrower and repaid to the 
fund.
    ``(b) Exceptions.--Amounts described in subsection (a) which are 
loaned from a revolving loan fund to a borrower and repaid to the 
fund--
            ``(1) may only be used for activities which are consistent 
        with the purposes of this title; and
            ``(2) shall be subject to the financial management, 
        accounting, reporting, and auditing standards which were 
        originally applicable to the grant.
    ``(c) Regulations.--Not later than 30 days after the effective date 
of the Economic Development Partnership Act of 1995, the Federal 
Cochairman shall issue regulations to carry out subsection (a).
    ``(d) Public Review and Comment.--Before issuing any final 
guidelines or administrative manuals governing the operation of 
revolving loan funds established using amounts from grants under this 
title, the Federal Cochairman shall provide reasonable opportunity for 
public review of and comment on such guidelines and administrative 
manuals.
    ``(e) Applicability to Past Grants.--The requirements of this 
section applicable to amounts from grants made under this title shall 
also apply to amounts from grants made, before the effective date of 
the Economic Development Partnership Act of 1995, under title I of this 
Act, as in effect on the day before such effective date.

      ``TITLE IV--TECHNICAL ASSISTANCE, RESEARCH, AND INFORMATION

``SEC. 401. TECHNICAL ASSISTANCE.

    ``(a) In General.--In carrying out its duties under this Act, a 
Regional Commission may provide technical assistance which would be 
useful in alleviating or preventing conditions of excessive 
unemployment or underemployment to areas which the Regional Commission 
finds have substantial need for such assistance. Such assistance shall 
include project planning and feasibility studies, management and 
operational assistance, establishment of business outreach centers, and 
studies evaluating the needs of, and development potentialities for, 
economic growth of such areas.
    ``(b) Procedures and Terms.--
            ``(1) Manner of providing assistance.--Assistance may be 
        provided by a Regional Commission through--
                    ``(A) members of the Regional Commission's staff;
                    ``(B) the payment of funds authorized for this 
                section to departments or agencies of the Federal 
                Government;
                    ``(C) the employment of private individuals, 
                partnerships, firms, corporations, or suitable 
                institutions under contracts entered into for such 
                purposes; or
                    ``(D) grants-in-aid to appropriate public or 
                private nonprofit State, area, district, or local 
                organizations.
            ``(2) Repayment terms.--A Regional Commission, in its 
        discretion, may require the repayment of assistance provided 
        under this subsection and prescribe the terms and conditions of 
        such repayment.
    ``(c) Grants Covering Administrative Expenses.--
            ``(1) In general.--A Regional Commission may make grants to 
        defray not to exceed 75 percent of the administrative expenses 
        of organizations which the Regional Commission determines to be 
        qualified to receive grants-in-aid under subsections (a) and 
        (b); except that in the case of a grant under this subsection 
        to an Indian tribe, the Regional Commission is authorized to 
        defray up to 100 percent of such expenses.
            ``(2) Determination of non-federal share.--In determining 
        the amount of the non-Federal share of such costs or expenses, 
        a Regional Commission shall give due consideration to all 
        contributions both in cash and in kind, fairly evaluated, 
        including contributions of space, equipment, and services.
            ``(3) Use of grants with planning grants.--Where 
        practicable, grants-in-aid authorized under this subsection 
        shall be used in conjunction with other available planning 
        grants to assure adequate and effective planning and economical 
        use of funds.
    ``(d) Availability of Technical Information; Federal Procurement.--
A Regional Commission shall aid areas described in section 502(a) and 
other areas by furnishing to interested individuals, communities, 
industries, and enterprises within such areas any assistance, technical 
information, market research, or other forms of assistance, 
information, or advice which would be useful in alleviating or 
preventing conditions of excessive unemployment or underemployment 
within such areas. The Regional Commission may furnish the procurement 
divisions of the various departments, agencies, and other 
instrumentalities of the Federal Government with a list containing the 
names and addresses of business firms which are located in areas 
described in section 502(a) and which are desirous of obtaining 
Government contracts for the furnishing of supplies or services, and 
designating the supplies and services such firms are engaged in 
providing.

``SEC. 402. ECONOMIC DEVELOPMENT PLANNING.

    ``(a) Direct Grants.--
            ``(1) In general.--A Regional Commission may, upon 
        application of any State, or city, or other political 
        subdivision of a State, or sub-State planning and development 
        organization (including an area described in section 502(a) or 
        an economic development district), make direct grants to such 
        State, city, or other political subdivision, or organization to 
        pay up to 80 percent of the cost for economic development 
        planning.
            ``(2) Planning projects specifically included.--The 
        planning for cities, other political subdivisions, and sub-
        State planning and development organizations (including areas 
        described in section 502(a) and economic development districts) 
        assisted under this section shall include systematic efforts to 
        reduce unemployment and increase incomes.
            ``(3) Planning process.--The planning shall be a continuous 
        process involving public officials and private citizens in 
        analyzing local economies, defining development goals, 
        determining project opportunities, and formulating and 
        implementing a development program.
            ``(4) Coordination of assistance under section 401(c).--The 
        assistance available under this section may be provided in 
        addition to assistance available under section 401(c) but shall 
        not supplant such assistance.
    ``(b) Compliance With Review Procedure.--The planning assistance 
authorized under this title shall be used in conjunction with any other 
available Federal planning assistance to assure adequate and effective 
planning and economical use of funds.

            ``TITLE V--ELIGIBILITY AND INVESTMENT STRATEGIES

                         ``PART A--ELIGIBILITY

``SEC. 501. ELIGIBLE RECIPIENT DEFINED.

    ``In this Act, the term `eligible recipient' means an area 
described in section 502(a), an economic development district 
designated under section 510, an Indian tribe, a State, a city or other 
political subdivision of a State, or a consortium of such political 
subdivisions, or a public or private nonprofit organization or 
association acting in cooperation with officials of such political 
subdivisions.

``SEC. 502. AREA ELIGIBILITY.

    ``(a) Certification.--In order to be eligible for assistance under 
title II, an applicant seeking assistance to undertake a project in an 
area shall certify, as part of an application for such assistance, that 
the area on the date of submission of such application meets 1 or more 
of the following criteria:
            ``(1) The area has a per capita income of 80 percent or 
        less of the national average.
            ``(2) The area has an unemployment rate 1 percent above the 
        national average percentage for the most recent 24-month period 
        for which statistics are available.
            ``(3) The area has experienced or is about to experience a 
        sudden economic dislocation resulting in job loss that is 
        significant both in terms of the number of jobs eliminated and 
        the effect upon the employment rate of the area.
            ``(4) The area is a community or neighborhood (defined 
        without regard to political or other subdivisions or 
        boundaries) which the Federal Cochairman determines has one or 
        more of the following conditions:
                    ``(A) A large concentration of low-income persons.
                    ``(B) Rural areas having substantial out-migration.
                    ``(C) Substantial unemployment.
    ``(b) Documentation.--A certification made under subsection (a) 
shall be supported by Federal data, when available, and in other cases 
by data available through the State government. Such documentation 
shall be accepted by a Regional Commission unless it is determined to 
be inaccurate. The most recent statistics available shall be used.
    ``(c) Special Rule.--An area which a Regional Commission determines 
has 1 or more of the conditions described in subsection (a)(4)--
            ``(1) shall not be subject to the requirements of 
        subparagraphs (A) and (C) of section 201(a)(1); and
            ``(2) shall not be eligible to meet the requirements of 
        section 510(a)(1)(B).
    ``(d) Prior Designations.--Any designation of a redevelopment area 
made before the effective date of the Economic Development Partnership 
Act of 1995 shall not be effective after such effective date.

``SEC. 503. INVESTMENT STRATEGY.

    ``A Regional Commission may provide assistance under titles II and 
III to an applicant for a project only if the applicant submits to the 
Regional Commission, as part of an application for such assistance, and 
the Regional Commission approves an investment strategy which--
            ``(1) identifies the economic development problems to be 
        addressed using such assistance;
            ``(2) identifies past, present, and projected future 
        economic development investments in the area receiving such 
        assistance and public and private participants and sources of 
        funding for such investments;
            ``(3) sets forth a strategy for addressing the economic 
        problems identified pursuant to paragraph (1) and describes how 
        the strategy will solve such problems;
            ``(4) provides a description of the project necessary to 
        implement the strategy, estimates of costs, and timetables; and
            ``(5) provides a summary of public and private resources 
        expected to be available for the project.

``SEC. 504. APPROVAL OF PROJECTS.

    ``Only applications for grants or other assistance under this Act 
for specific projects shall be approved which are certified by the 
State member of the Regional Commission representing such applicant and 
determined by the Federal Cochairman--
            ``(1) to be included in a State investment strategy 
        approved by the Regional Commission;
            ``(2) to have adequate assurance that the project will be 
        properly administered, operated, and maintained; and
            ``(3) to otherwise meet the requirements for assistance 
        under this Act.

                ``PART B--ECONOMIC DEVELOPMENT DISTRICTS

``SEC. 510. DESIGNATION OF ECONOMIC DEVELOPMENT DISTRICTS AND ECONOMIC 
                    DEVELOPMENT CENTERS.

    ``(a) In General.--In order that economic development projects of 
broader geographic significance may be planned and carried out, a 
Regional Commission may--
            ``(1) designate appropriate `economic development 
        districts' within the United States with the concurrence of the 
        States in which such districts will be wholly or partially 
        located, if--
                    ``(A) the proposed district is of sufficient size 
                or population, and contains sufficient resources, to 
                foster economic development on a scale involving more 
                than a single area described in section 502(a);
                    ``(B) the proposed district contains at least 1 
                area described in section 502(a);
                    ``(C) the proposed district contains 1 or more 
                areas described in section 502(a) or economic 
                development centers identified in an approved district 
                investment strategy as having sufficient size and 
                potential to foster the economic growth activities 
                necessary to alleviate the distress of the areas 
                described in section 502(a) within the district; and
                    ``(D) the proposed district has a district 
                investment strategy which includes adequate land use 
                and transportation planning and contains a specific 
                program for district cooperation, self-help, and public 
                investment and is approved by the State or States 
                affected and by the Regional Commission;
            ``(2) designate as `economic development centers', in 
        accordance with such regulations as the Federal Cochairman 
        shall prescribe, such areas as the Regional Commission may deem 
        appropriate, if--
                    ``(A) the proposed center has been identified and 
                included in an approved district investment strategy 
                and recommended by the State or States affected for 
                such special designation;
                    ``(B) the proposed center is geographically and 
                economically so related to the district that its 
                economic growth may reasonably be expected to 
                contribute significantly to the alleviation of distress 
                in the areas described in section 502(a) of the 
                district; and
                    ``(C) the proposed center does not have a 
                population in excess of 250,000 according to the most 
                recent Federal census.
            ``(3) provide financial assistance in accordance with the 
        criteria of this Act, except as may be herein otherwise 
        provided, for projects in economic development centers 
        designated under subsection (a)(2), if--
                    ``(A) the project will further the objectives of 
                the investment strategy of the district in which it is 
                to be located:
                    ``(B) the project will enhance the economic growth 
                potential of the district or result in additional long-
                term employment opportunities commensurate with the 
                amount of Federal financial assistance requested; and
                    ``(C) the amount of Federal financial assistance 
                requested is reasonably related to the size, 
                population, and economic needs of the district;
            ``(4) subject to the 20 percent non-Federal share required 
        for any project by section 201(c), increase the amount of grant 
        assistance authorized by section 201 for projects within areas 
        described in section 502(a), by an amount not to exceed 10 
        percent of the aggregate cost of any such project, in 
        accordance with such regulations as the Federal Cochairman 
        shall prescribe if--
                    ``(A) the area described in section 502(a) is 
                situated within a designated economic development 
                district and is actively participating in the economic 
                development activities of the district; and
                    ``(B) the project is consistent with an approved 
                investment strategy.
    ``(b) Authorities.--In designating economic development districts 
and approving district investment strategies under subsection (a), a 
Regional Commission may, under regulations prescribed by the Federal 
Cochairman--
            ``(1) invite the several States to draw up proposed 
        district boundaries and to identify potential economic 
        development centers;
            ``(2) cooperate with the several States--
                    ``(A) in sponsoring and assisting district economic 
                planning and development groups; and
                    ``(B) in assisting such district groups to 
                formulate district investment strategies; and
            ``(3) encourage participation by appropriate local 
        governmental authorities in such economic development 
        districts.
    ``(c) Termination or Modification of Designations.--The Federal 
Cochairman shall by regulation prescribe standards for the termination 
or modification of economic development districts and economic 
development centers designated under the authority of this section.
    ``(d) Definitions.--In this Act, the following definitions apply:
            ``(1) Economic development district.--The term `economic 
        development district' refers to any area within the United 
        States composed of cooperating areas described in section 
        502(a) and, where appropriate, designated economic development 
        centers and neighboring counties or communities, which has been 
        designated by a Regional Commission as an economic development 
        district. Such term includes any economic development district 
        designated under section 403 of this Act, as in effect on the 
        day before the effective date of the Economic Development 
        Partnership Act of 1995.
            ``(2) Economic development center.--The term `economic 
        development center' refers to any area within the United States 
        which has been identified as an economic development center in 
        an approved investment strategy and which has been designated 
        by a Regional Commission as eligible for financial assistance 
        under this Act in accordance with the provisions of this 
        section.
            ``(3) Local government.--The term `local government' means 
        any city, county, town, parish, village, or other general-
        purpose political subdivision of a State.
    ``(e) Parts of Economic Development Districts Not Within Areas 
Described in Section 502(a).-- A Regional Commission is authorized to 
provide the financial assistance which is available to an area 
described in section 502(a) under this Act to those parts of an 
economic development district which are not within an area described in 
section 502(a), when such assistance will be of a substantial direct 
benefit to an area described in section 502(a) within such district. 
Such financial assistance shall be provided in the same manner and to 
the same extent as is provided in this Act for an area described in 
section 502(a); except that nothing in this subsection shall be 
construed to permit such parts to receive the increase in the amount of 
grant assistance authorized subsection (a)(4).

                       ``TITLE VI--ADMINISTRATION

``SEC. 601. FUNCTIONS OF ECONOMIC DEVELOPMENT COMMISSION.

    ``In administering the Economic Development Commission, the Federal 
Cochairman shall ensure that the Commission--
            ``(1) serves as a central information clearinghouse on 
        matters relating to economic development, economic adjustment, 
        disaster recovery, and defense conversion programs and 
        activities of the Federal and State governments, including 
        political subdivisions of the States; and
            ``(2) helps potential and actual applicants for economic 
        development, economic adjustment, disaster recovery, and 
        defense conversion assistance under Federal, State, and local 
        laws in locating and applying for such assistance, including 
        financial and technical assistance.

``SEC. 602. CONSULTATION WITH OTHER PERSONS AND AGENCIES.

    ``(a) Consultation on Problems Relating to Employment.--The Federal 
Cochairman is authorized from time to time to call together and confer 
with any persons, including representatives of labor, management, 
agriculture, and government, who can assist in meeting the problems of 
area and regional unemployment or underemployment.
    ``(b) Consultation on Administration of Act.--The Federal 
Cochairman may make provisions for such consultation with interested 
departments and agencies as the Federal Cochairman may deem appropriate 
in the performance of the functions vested in the Federal Cochairman by 
this Act.

``SEC. 603. ADMINISTRATION, OPERATION, AND MAINTENANCE.

    ``No Federal assistance shall be approved under this Act unless the 
Federal Cochairman is satisfied that the project for which Federal 
assistance is granted will be properly and efficiently administered, 
operated, and maintained.

``SEC. 604. TREATMENT OF ECONOMIC DEVELOPMENT ADMINISTRATION EMPLOYEES.

    ``In considering applications for employment at the Economic 
Development Commission or in a Regional Commission, preference shall be 
given to individuals who are employees of the Economic Development 
Administration on the effective date of the Economic Development 
Partnership Act of 1995.

                       ``TITLE VII--MISCELLANEOUS

``SEC. 701. POWERS OF FEDERAL COCHAIRMAN.

    ``(a) In General.--In performing the Federal Cochairman's duties 
under this Act, the Federal Cochairman is authorized to--
            ``(1) adopt, alter, and use a seal, which shall be 
        judicially noticed;
            ``(2) subject to the civil-service and classification laws, 
        select, employ, appoint, and fix the compensation of such 
        personnel as may be necessary to carry out the provisions of 
        this Act;
            ``(3) hold such hearings, sit and act at such times and 
        places, and take such testimony, as the Federal Cochairman may 
        deem advisable;
            ``(4) request directly from any executive department, 
        bureau, agency, board, commission, office, independent 
        establishment, or instrumentality information, suggestions, 
        estimates, and statistics needed to carry out the purposes of 
        this Act; and each department, bureau, agency, board, 
        commission, office, establishment, or instrumentality is 
        authorized to furnish such information, suggestions, estimates, 
        and statistics directly to the Federal Cochairman;
            ``(5) under regulations prescribed by the Federal 
        Cochairman, assign or sell at public or private sale, or 
        otherwise dispose of for cash or credit, in the Federal 
        Cochairman's discretion and upon such terms and conditions and 
        for such consideration as the Federal Cochairman determines to 
        be reasonable, any evidence of debt, contract, claim, personal 
        property, or security assigned to or held by the Federal 
        Cochairman in connection with assistance extended under this 
        Act, and collect or compromise all obligations assigned to or 
        held by the Federal Cochairman in connection with such 
        assistance until such time as such obligations may be referred 
        to the Attorney General for suit or collection;
            ``(6) deal with, complete, renovate, improve, modernize, 
        insure, rent, or sell for cash or credit, upon such terms and 
        conditions and for such consideration as the Federal Cochairman 
        determines to be reasonable, any real or personal property 
        conveyed to, or otherwise acquired by the Federal Cochairman in 
        connection with assistance extended under this Act;
            ``(7) pursue to final collection, by way of compromise or 
        other administrative action, prior to reference to the Attorney 
        General, all claims against third parties assigned to the 
        Federal Cochairman in connection with assistance extended this 
        Act;
            ``(8) acquire, in any lawful manner and in accordance with 
        the requirements of the Federal Property and Administrative 
        Services Act of 1949, any property (real, personal, or mixed, 
        tangible or intangible), whenever necessary or appropriate to 
        the conduct of the activities authorized under this Act;
            ``(9) in addition to any powers, functions, privileges, and 
        immunities otherwise vested in the Federal Cochairman, take any 
        action, including the procurement of the services of attorneys 
        by contract, determined by the Federal Cochairman to be 
        necessary or desirable in making, purchasing, servicing, 
        compromising, modifying, liquidating, or otherwise 
        administratively dealing with assets held in connection with 
        financial assistance extended under this Act;
            ``(10) employ experts and consultants or organizations as 
        authorized by section 3109 of title 5, United States Code, 
        compensate individuals so employed at rates not in excess of 
        $100 per diem, including travel time, and allow them, while 
        away from their homes or regular places of business, travel 
        expenses (including per diem in lieu of subsistence) as 
        authorized by section 5703 of title 5, United States Code, for 
        persons in the Government service employed intermittently, 
        while so employed, except that contracts for such employment 
        may be renewed annually;
            ``(11) sue and be sued in any court of record of a State 
        having general jurisdiction or in any United States district 
        court, and jurisdiction is conferred upon such district court 
        to determine such controversies without regard to the amount in 
        controversy; but no attachment, injunction, garnishment, or 
        other similar process, mesne or final, shall be issued against 
        the Federal Cochairman or the Federal Cochairman's property;
            ``(12) make discretionary grants, pursuant to authorities 
        otherwise available to a Regional Commission under this Act and 
        without regard to the requirements of section 504, to implement 
        significant regional initiatives, to take advantage of special 
        development opportunities, or to respond to emergency economic 
        distress in the region from the funds withheld from 
        distribution to the Regional Commissions; except that the 
        aggregate amount of such discretionary grants in any fiscal 
        year may not exceed 10 percent of the amounts appropriated 
        under title VIII for such fiscal year; and
            ``(13) establish such rules, regulations, and procedures as 
        the Federal Cochairman considers appropriate in carrying out 
        the provisions of this Act.
    ``(b) Deficiency Judgments.--The authority under subsection (a)(7) 
to pursue claims shall include the authority to obtain deficiency 
judgments or otherwise in the case of mortgages assigned to the Federal 
Cochairman.
    ``(c) Inapplicability of Certain Other Requirements.--Section 3709 
of the Revised Statutes of the United States shall not apply to any 
contract of hazard insurance or to any purchase or contract for 
services or supplies on account of property obtained by the Federal 
Cochairman as a result of assistance extended under this Act if the 
premium for the insurance or the amount of the insurance does not 
exceed $1,000.
    ``(d) Powers of Conveyance and Execution.--The power to convey and 
to execute, in the name of the Federal Cochairman, deeds of conveyance, 
deeds of release, assignments and satisfactions of mortgages, and any 
other written instrument relating to real or personal property or any 
interest therein acquired by the Federal Cochairman pursuant to the 
provisions of this Act may be exercised by the Federal Cochairman, or 
by any officer or agent appointed by the Federal Cochairman for such 
purpose, without the execution of any express delegation of power or 
power of attorney.

``SEC. 702. ALLOCATION OF FUNDS.

    The Federal Cochairman shall establish a formula for the equitable 
allocation among the Regional Commissions of amounts appropriated to 
carry out this Act.

``SEC. 703. PERFORMANCE MEASURES.

    ``The Federal Cochairman shall establish performance measures for 
grants and other assistance provided under this Act. Such performance 
measures shall be used to evaluate project proposals and conduct 
evaluations of projects receiving such assistance.

``SEC. 704. MAINTENANCE OF STANDARDS.

    ``The Federal Cochairman shall continue to implement and enforce 
the provisions of section 712 of this Act, as in effect on the day 
before the effective date of the Economic Development Partnership Act 
of 1995.

``SEC. 705. TRANSFER OF FUNCTIONS.

    ``The functions, powers, duties, and authorities and the assets, 
funds, contracts, loans, liabilities, commitments, authorizations, 
allocations, and records which are vested in or authorized to be 
transferred to the Secretary of the Treasury under section 29(b) of the 
Area Redevelopment Act, and all functions, powers, duties, and 
authorities under section 29(c) of such Act are hereby vested in the 
Federal Cochairman.

``SEC. 706. DEFINITION OF STATE.

    ``In this Act, the terms `State', `States', and `United States' 
include the several States and each of the other political entities 
included in a region established by section 106.

``SEC. 707. ANNUAL REPORT TO CONGRESS.

    ``The Federal Cochairman shall transmit a comprehensive and 
detailed annual report to Congress of the Federal Cochairman's and each 
Regional Commission's operations under this Act for each fiscal year 
beginning with the fiscal year ending September 30, 1996. Such report 
shall be printed and shall be transmitted to Congress not later than 
April 1 of the year following the fiscal year with respect to which 
such report is made.

``SEC. 708. USE OF OTHER FACILITIES.

    ``(a) Delegation of Functions to Other Federal Departments and 
Agencies.--The Federal Cochairman may delegate to the heads of other 
departments and agencies of the Federal Government any of the Federal 
Cochairman's functions, powers, and duties under this Act as the 
Federal Cochairman may deem appropriate, and to authorize the 
redelegation of such functions, powers, and duties by the heads of such 
departments and agencies.
    ``(b) Department and Agency Execution of Delegated Authority.--
Departments and agencies of the Federal Government shall exercise their 
powers, duties, and functions in such manner as will assist in carrying 
out the objectives of this Act.
    ``(c) Transfer Between Departments.--Funds authorized to be 
appropriated under this Act may be transferred between departments and 
agencies of the Government, if such funds are used for the purposes for 
which they are specifically authorized and appropriated.
    ``(d) Funds Transferred From Other Departments and Agencies.--In 
order to carry out the objectives of this Act, the Federal Cochairman 
may accept transfers of funds from other departments and agencies of 
the Federal Government if the funds are used for the purposes for which 
(and in accordance with the terms under which) the funds are 
specifically authorized and appropriated. Such transferred funds shall 
remain available until expended, and may be transferred to and merged 
with the appropriations under the heading `salaries and expenses' by 
the Federal Cochairman to the extent necessary to administer the 
program.

``SEC. 709. PENALTIES.

    ``(a) False Statements; Security Overvaluation.--Whoever makes any 
statement knowing it to be false, or whoever willfully overvalues any 
security, for the purpose of obtaining for such person or for any 
applicant any financial assistance under this Act or any extension of 
such assistance by renewal, deferment or action, or otherwise, or the 
acceptance, release, or substitution of security for such assistance, 
or for the purpose of influencing in any way the action of the Federal 
Cochairman or a Regional Commission or for the purpose of obtaining 
money, property, or anything of value, under this Act, shall be fined 
under title 18, United States Code, imprisoned for not more than 5 
years, or both.
    ``(b) Embezzlement and Fraud-Related Crimes.--Whoever, being 
connected in any capacity with the Federal Cochairman or a Regional 
Commission, in the administration of this Act--
            ``(1) embezzles, abstracts, purloins, or willfully 
        misapplies any moneys, funds, securities, or other things of 
        value, whether belonging to such person or pledged or otherwise 
        entrusted to such person;
            ``(2) with intent to defraud the Federal Cochairman or a 
        Regional Commission or any other body politic or corporate, or 
        any individual, or to deceive any officer, auditor, or 
        examiner, makes any false entry in any book, report, or 
        statement of or to the Federal Cochairman or a Regional 
        Commission, or without being duly authorized draws any orders 
        or issues, puts forth, or assigns any note, debenture, bond, or 
        other obligation, or draft, bill of exchange, mortgage, 
        judgment, or decree thereof;
            ``(3) with intent to defraud participates or shares in or 
        receives directly or indirectly any money, profit, property, or 
        benefit through any transaction, loan, grant, commission, 
        contract, or any other act of the Federal Cochairman or a 
        Regional Commission; or
            ``(4) gives any unauthorized information concerning any 
        future action of plan of the Federal Cochairman or a Regional 
        Commission which might affect the value of securities, or 
        having such knowledge invests or speculates, directly or 
        indirectly, in the securities or property of any company or 
        corporation receiving loans, grants, or other assistance from 
        the Federal Cochairman or a Regional Commission,
shall be fined under title 18, United States Code, imprisoned for not 
more than 5 years, or both.

``SEC. 710. EMPLOYMENT OF EXPEDITERS AND ADMINISTRATIVE EMPLOYEES.

    ``No financial assistance shall be extended by a Regional 
Commission under this Act to any business enterprise unless the owners, 
partners, or officers of such business enterprise--
            ``(1) certify to the Regional Commission the names of any 
        attorneys, agents, and other persons engaged by or on behalf of 
        such business enterprise for the purpose of expediting 
        applications made to the Regional Commission for assistance of 
        any sort, under this Act, and the fees paid or to be paid to 
        any such person; and
            ``(2) execute an agreement binding such business 
        enterprise, for a period of 2 years after such assistance is 
        rendered by the Regional Commission to such business 
        enterprise, to refrain from employing, tendering any office or 
        employment to, or retaining for professional services, any 
        person who, on the date such assistance or any part thereof was 
        rendered, or within the 1-year period ending on such date, 
        shall have served as an officer, attorney, agent, or employee, 
        occupying a position or engaging in activities which the 
        Regional Commission determines involves discretion with respect 
        to the granting of assistance under this Act.

``SEC. 711. PERSONAL FINANCIAL INTERESTS.

    ``(a) In General.--Except as permitted by subsection (b), no State 
member or alternate and no officer or employee of a Regional Commission 
shall participate personally and substantially as member, alternate, 
officer, or employee, through decision, approval, disapproval, 
recommendation, the rendering of advice, investigation, or otherwise, 
in any proceeding, application, request for a ruling or other 
determination, contract, claim, controversy, or other particular matter 
in which, to the individual's knowledge, the individual, the 
individual's spouse, minor child, partner, organization (other than a 
State or political subdivision thereof) in which the individual is 
serving as officer, director, trustee, partner, or employee, or any 
person or organization with whom the individual is serving as officer, 
director, trustee, partner, or employee, or any person or organization 
with whom the individual is negotiating or has any arrangement 
concerning prospective employment, has a financial interest. Any 
individual who shall violate the provisions of this subsection shall be 
fined under title 18, United States Code, imprisoned for not more than 
2 years, or both.
    ``(b) Exception.--Subsection (a) shall not apply if the State 
member, alternate, officer, or employee first advises the Regional 
Commission of the nature and circumstances of the proceeding, 
application, request for a ruling or other determination, contract, 
claim, controversy, or other particular matter and makes full 
disclosure of the financial interest and receives in advance a written 
determination made by the Regional Commission that the interest is not 
so substantial as to be deemed likely to affect the integrity of the 
services which the Regional Commission may expect from such State 
member, alternate, officer, or employee.
    ``(c) Salaries.--No State member or alternate of a Regional 
Commission shall receive any salary, or any contribution to or 
supplementation of salary for the individual's services on the Regional 
Commission from any source other than the State of the individual. No 
individual detailed to serve the Regional Commission under authority of 
section 105 shall receive any salary or any contribution to or 
supplementation of salary for the individual's services on the Regional 
Commission from any source other than the State, local, or 
intergovernmental department or agency from which he was detailed or 
from the Regional Commission. Any individual who shall violate the 
provisions of this subsection shall be fined under title 18, United 
States Code, imprisoned for not more than 1 year, or both.
    ``(d) Nonapplicability to Federal Officials.--Notwithstanding any 
other provision of this section, the Federal Cochairman (or the Federal 
Cochairman's alternate) and any Federal officers or employees detailed 
to duty with a Regional Commission pursuant to section 105 shall not be 
subject to such provisions but shall remain subject to sections 202 
through 209 of title 18, United States Code.
    ``(e) Authority To Rescind Certain Agreements.--A Regional 
Commission may, in the Regional Commission's discretion, declare void 
and rescind any agreement to extend financial assistance under this Act 
entered into by the Regional Commission in relation to which the 
Regional Commission finds that there has been a violation of subsection 
(a) or (c) of this section or any of the provisions of sections 202 
through 209 of title 18, United States Code.

``SEC. 712. MAINTENANCE OF RECORDS OF APPROVED APPLICATIONS FOR 
                    FINANCIAL ASSISTANCE; PUBLIC INSPECTION.

    ``(a) Maintenance of Record Required.--The Federal Cochairman shall 
maintain as a permanent part of the records of the Economic Development 
Commission a list of applications approved for financial assistance 
under this Act, which shall be kept available for public inspection 
during the regular business hours of the Economic Development 
Commission.
    ``(b) Posting to List.--The following information shall be posted 
in such list as soon as each application is approved:
            ``(1) The name of the applicant and, in the case of 
        corporate applications, the names of the officers and directors 
        thereof.
            ``(2) The amount and duration of the financial assistance 
        for which application is made.
            ``(3) The purposes for which the proceeds of the financial 
        assistance are to be used.

``SEC. 713. RECORDS AND AUDIT.

    ``(a) Recordkeeping and Disclosure Requirements.--Each recipient of 
assistance under this Act shall keep such records as the Federal 
Cochairman shall prescribe, including records which fully disclose the 
amount and the disposition by such recipient of the proceeds of such 
assistance, the total cost of the project or undertaking in connection 
with which such assistance is given or used, and the amount and nature 
of that portion of the cost of the project or undertaking supplied by 
other sources, and such other records as will facilitate an effective 
audit.
    ``(b) Access to Books for Examination and Audit.--The Federal 
Cochairman and the Comptroller General of the United States, or any of 
their duly authorized representatives, shall have access for the 
purpose of audit and examination to any books, documents, papers, and 
records of the recipient that are pertinent to assistance received 
under this Act.

``SEC. 714. PROHIBITION AGAINST A STATUTORY CONSTRUCTION WHICH MIGHT 
                    CAUSE DIMINUTION IN OTHER FEDERAL ASSISTANCE.

    ``All financial and technical assistance authorized under this Act 
shall be in addition to any Federal assistance previously authorized, 
and no provision of this Act shall be construed as authorizing or 
permitting any reduction or diminution in the proportional amount of 
Federal assistance to which any State or other entity eligible under 
this Act would otherwise be entitled under the provisions of any other 
Act.

``SEC. 715. ACCEPTANCE OF APPLICANTS' CERTIFICATIONS.

    ``A Regional Commission may accept, when deemed appropriate, the 
applicants' certifications to meet the requirements of this Act.

                         ``TITLE VIII--FUNDING

``SEC. 801. AUTHORIZATION OF APPROPRIATIONS

    ``There is authorized to be appropriated to carry out this Act 
$340,000,000 per fiscal year for each of fiscal years 1996, 1997, 1998, 
1999, and 2000. Such sums shall remain available until expended.

``SEC. 802. DEFENSE CONVERSION ACTIVITIES.

    ``In addition to the appropriations authorized by section 801, 
there are authorized to be appropriated to carry out this Act such sums 
as may be necessary to provide assistance for defense conversion 
activities. Such funding may include pilot projects for privatization 
and economic development activities for closed or realigned military 
installations. Such sums shall remain available until expended.''.

SEC. 10512. CONFORMING AMENDMENTS.

    Title 5, United States Code, is amended--
            (1) in section 5314 by adding at the end the following:
            ``Federal Cochairman of the Economic Development 
        Commission.''; and
            (2) in section 5316--
                    (A) by striking the following:
            ``Administrator for Economic Development.''; and
                    (B) by adding at the end the following:
            ``Alternate for the Federal Cochairman of the Economic 
        Development Commission.''.

SEC. 10513. SAVINGS PROVISIONS.

    (a) Legal Documents.--All orders, determinations, rules, 
regulations, permits, grants, loans, contracts, agreements, 
certificates, licenses, and privileges--
            (1) that have been issued, made, granted, or allowed to 
        become effective by the President, the Secretary of Commerce, 
        any officer or employee of any office transferred by this 
        chapter, or any other Government official, or by a court of 
        competent jurisdiction, in the performance of any function that 
        is transferred by this chapter; and
            (2) that are in effect on the effective date of such 
        transfer (or become effective after such date pursuant to their 
        terms as in effect on such effective date),
shall continue in effect according to their terms until modified, 
terminated, superseded, set aside, or revoked in accordance with law by 
the President, any other authorized official, a court of competent 
jurisdiction, or operation of law.
    (b) Proceedings.--This chapter shall not affect any proceedings or 
any application for any benefits, service, license, permit, 
certificate, or financial assistance pending on the date of the 
enactment of this Act before an office transferred by this chapter, but 
such proceedings and applications shall be continued. Orders shall be 
issued in such proceedings, appeals shall be taken therefrom, and 
payments shall be made pursuant to such orders, as if this chapter had 
not been enacted, and orders issued in any such proceeding shall 
continue in effect until modified, terminated, superseded, or revoked 
by a duly authorized official, by a court of competent jurisdiction, or 
by operation of law. Nothing in this subsection shall be considered to 
prohibit the discontinuance or modification of any such proceeding 
under the same terms and conditions and to the same extent that such 
proceeding could have been discontinued or modified if this chapter had 
not been enacted.
    (c) Suits.--This chapter shall not affect suits commenced before 
the date of the enactment of this Act, and in all such suits, 
proceeding shall be had, appeals taken, and judgments rendered in the 
same manner and with the same effect as if this chapter had not been 
enacted.
    (d) Nonabatement of Actions.--No suit, action, or other proceeding 
commenced by or against the Department of Commerce or the Secretary of 
Commerce, or by or against any individual in the official capacity of 
such individual as an officer or employee of an office transferred by 
this chapter, shall abate by reason of the enactment of this chapter.
    (e) Continuance of Suits.--If any officer of the Department of 
Commerce in the official capacity of such officer is party to a suit 
with respect to a function of the officer, and under this chapter such 
function is transferred to any other officer or office, then such suit 
shall be continued with the other officer or the head of such other 
office, as applicable, substituted or added as a party.

SEC. 10514. REFERENCES.

    Any reference in any other Federal law, Executive order, rule, 
regulation, or delegation of authority, or any document of or 
pertaining to an office from which a function is transferred by this 
chapter--
            (1) to the Secretary of Commerce or an officer of the 
        Department of Commerce, is deemed to refer to the head of the 
        department or office to which such function is transferred; or
            (2) to the Department of Commerce or an agency in the 
        Department of Commerce is deemed to refer to the department or 
        office to which such function is transferred.

              CHAPTER 2--APPALACHIAN REGIONAL DEVELOPMENT

SEC. 10521. FINDINGS AND PURPOSES.

    Section 2 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 2) is amended by adding at the end the following:
    ``(c) 1995 Findings and Purposes.--The Congress further finds and 
declares that, while substantial progress has been made in fulfilling 
many of the objectives of this Act, rapidly changing national and 
global economies over the past decade have created new problems and 
challenges for rural areas throughout the Nation and especially for the 
Appalachian region. It is, therefore, also the purpose of this Act to 
assist the region in providing the infrastructure necessary for 
economic and human resource development, in developing its industry, in 
building entrepreneurial communities, in generating a diversified 
regional economy, and in making its industrial and commercial resources 
more competitive in national and world markets. It is further the 
purpose of this Act to provide a framework for coordinating Federal, 
State, and local initiatives to respond to the economic competitive 
challenge through improving the skills of the region's workforce, 
adapting and applying new technologies for the region's businesses, and 
improving the access of the region's businesses to the technical and 
financial resources necessary to their development. Finally, it is the 
purpose of this Act to address the needs of severely and persistently 
distressed and underdeveloped areas of the region so as to provide a 
fairer opportunity for the people of the region to share the quality of 
life generally enjoyed by citizens across this Nation.''.

SEC. 10522. MEETINGS.

    (a) Annual Meeting Requirement.--Section 101(a) of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App. 101(a)) is amended by 
adding at the end the following: ``The Commission shall conduct at 
least one meeting each year with the Federal Cochairman and at least a 
majority of the State members present.''.
    (b) Additional Meetings by Electronic Means.--Section 101 of such 
Act (40 U.S.C. App. 101) is amended--
            (1) in subsection (a), as amended by subsection (a) of this 
        section, by adding at the end the following: ``The Commission 
        may conduct such additional meetings by electronic means as the 
        Commission considers advisable, including meetings to decide 
        matters requiring an affirmative vote.''; and
            (2) in subsection (c) by striking ``to be present'' at the 
        end of the fourth sentence.
    (c) Decisions Requiring a Quorum.--Section 101(b) of such Act (40 
U.S.C. App. 101(b)) is amended by striking the third sentence and 
inserting the following: ``No decision involving Commission policy, 
approval of State, regional, or subregional development plans or 
implementing investment programs, any modification or revision of the 
Appalachian Regional Commission Code, any allocation of funds among the 
State, or any designation of a distressed county or an economically 
competitive county may be made without a quorum of State members.''.

SEC. 10523. AUTHORIZATIONS FOR ADMINISTRATIVE EXPENSES.

    Section 105(b) of the Appalachian Regional Development Act of 1965 
(40 U.S.C. App. 105(b)) is amended to read as follows:
    ``(b) Authorization of Appropriations.--
            ``(1) In general.--There is authorized to be appropriated 
        to carry out this section $3,645,000 per fiscal year for each 
        of fiscal years 1996 through 2000. Such sums shall remain 
        available until expended.
            ``(2) Expenses of federal cochairman.--Of the amounts 
        appropriated pursuant to paragraph (1), not to exceed 
        $1,245,000 per fiscal year for each of fiscal years 1996 
        through 2000 shall be available for expenses of the Federal 
        Cochairman, the Federal Cochairman's alternate, and the Federal 
        Cochairman's staff.''.

SEC. 10524. ADMINISTRATIVE POWERS OF COMMISSION.

    (a) Authority To Lease.--Section 106(7) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App. 106(7)) is amended--
            (1) by inserting ``subject to the requirements of the 
        Federal Property and Administrative Services Act of 1949,'' 
        after ``(7)'';
            (2) by striking ``notwithstanding any other provision of 
        law,''; and
            (3) by striking ``1982'' and inserting ``2000''.
    (b) Authority to Maintain Temporary Office.--Section 106(8) of such 
Act (40 U.S.C. App. 106(8)) is amended by inserting ``subject to the 
requirements of the Federal Property and Administrative Services Act of 
1949,'' after ``(8)''.

SEC. 10525. HIGHWAY SYSTEM.

    (a) Authorization of Appropriations.--Section 201(g) of the 
Appalachian Regional Development Act of 1965 (40 U.S.C. App. 201(g)) is 
amended to read as follows:
    ``(g) Authorization of Appropriations.--There is authorized to be 
appropriated to carry out this section $90,000,000 per fiscal year for 
each of fiscal years 1996 through 2000. Such sums shall remain 
available until expended.''.
    (b) Cost Sharing.--
            (1) In general.--Section 201(h)(1) of such Act (40 U.S.C. 
        App. 201(h)(1)) is amended by striking ``70 per centum'' and 
        inserting ``80 percent''.
            (2) Applicability.--The amendment made by paragraph (1) 
        shall apply to projects approved after March 31, 1979.

SEC. 10526. COST SHARING OF DEMONSTRATION HEALTH PROJECTS.

    (a) Operation Costs.--Section 202(c) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App. 202(c)) is amended in the first 
sentence by striking ``100 per centum of the costs thereof'' and all 
that follows through the period at the end of the second sentence and 
inserting ``50 percent of the costs thereof (or 80 percent of such 
costs in the case of a project to be carried out in a county for which 
a distressed county designation is in effect under section 226).''.
    (b) Cost Sharing.--Section 202 of such Act (40 U.S.C. App. 202) is 
amended by adding at the end the following:
    ``(f) Maximum Commission Contribution After September 30, 1995.--
After September 30, 1995, not more than 50 percent of any project cost 
eligible for financial assistance under this section may be provided 
from funds appropriated to carry out this Act; except that such maximum 
Commission contribution may be increased to 80 percent, or to the 
percentage of the maximum Federal contribution authorized by this 
section, whichever is less, for a project to be carried out in a county 
for which a distressed county designation is in effect under section 
226.''.

SEC. 10527. REPEAL OF LAND STABILIZATION, CONSERVATION, AND EROSION 
                    CONTROL PROGRAM.

    Section 203 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 203) is repealed.

SEC. 10528. REPEAL OF TIMBER DEVELOPMENT PROGRAM.

    Section 204 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 204) is repealed.

SEC. 10529. REPEAL OF MINING AREA RESTORATION PROGRAM.

    Section 205 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 205) is repealed.

SEC. 10530. REPEAL OF WATER RESOURCE SURVEY.

    Section 206 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 206) is repealed.

SEC. 10531. COST SHARING OF HOUSING PROJECTS.

    (a) Loans.--Section 207(b) of the Appalachian Regional Development 
Act of 1965 (40 U.S.C. App. 207(b)) is amended by striking ``80 per 
centum'' and inserting ``50 percent (or 80 percent in the case of a 
project to be carried out in a county for which a distressed county 
designation is in effect under section 226)''.
    (b) Grants.--Section 207(c)(1) of such Act (40 U.S.C. 207(c)(1)) is 
amended by striking ``80 per centum'' and inserting ``50 percent (or 80 
percent in the case of a project to be carried out in a county for 
which a distressed county designation is in effect under section 
226)''.

SEC. 10532. REPEAL OF AIRPORT SAFETY IMPROVEMENTS PROGRAM.

    Section 208 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 208) is repealed.

SEC. 10533. COST SHARING OF VOCATIONAL EDUCATION AND EDUCATION 
                    DEMONSTRATION PROJECTS.

    (a) Operation Costs.--Section 211(b)(3) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App. 211(b)(3)) is amended in the 
first sentence by striking ``100 per centum of the costs thereof'' and 
all that follows through the period at the end of the second sentence 
and inserting ``50 percent of the costs thereof (or 80 percent of such 
costs in the case of a project to be carried out in a county for which 
a distressed county designation is in effect under section 226).''
    (b) Cost Sharing.--Section 211 of such Act (40 U.S.C. App. 211) is 
amended by adding at the end the following:
    ``(c) Maximum Commission Contribution After September 30, 1995.--
After September 30, 1995, not more than 50 percent of any project cost 
eligible for financial assistance under this section may be provided 
from funds appropriated to carry out this Act; except that such maximum 
Commission contribution may be increased to 80 percent, or to the 
percentage of the maximum Federal contribution authorized by this 
section, whichever is less, for a project to be carried out in a county 
for which a distressed county designation is in effect under section 
226.''.

SEC. 10534. SEWAGE TREATMENT WORKS PROGRAM.

    Section 212 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 212) is repealed.

SEC. 10535. REPEAL OF AMENDMENTS TO HOUSING ACT OF 1954.

    Section 213 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 213) is repealed.

SEC. 10536. SUPPLEMENTS TO FEDERAL GRANT-IN-AID PROGRAMS.

    (a) Availability of Amounts.--The first sentence of section 214(a) 
of the Appalachian Regional Development Act of 1965 (40 U.S.C. App. 
214(a)) is amended by striking ``the President is authorized to provide 
funds to the Federal Cochairman to be used'' and inserting ``the 
Federal Cochairman may use amounts made available to carry out this 
section''.
    (b) Cost Sharing.--Section 214(b) of such Act (40 U.S.C. App. 
214(b)) is amended--
            (1) by striking ``(b)'' and inserting ``(b)(1)''; and
            (2) by adding at the end the following:
    ``(2) After September 30, 1995, not more than 50 percent of any 
project cost eligible for financial assistance under this section may 
be provided from funds appropriated to carry out this Act; except that 
such maximum Commission contribution may be increased to 80 percent for 
a project to be carried out in a county for which a distressed county 
designation is in effect under section 226.''.
    (c) Federal Grant-in-Aid Programs Defined.--The first sentence of 
section 214(c) of such Act (40 U.S.C. App. 214(c)) is amended by 
striking ``on or before December 31, 1980,''.
    (d) Limitation on Covered Road Projects.--The second sentence of 
section 214(c) of such Act is amended by inserting ``authorized by 
title 23, United States Code'' after ``road construction''.

SEC. 10537. PROGRAM DEVELOPMENT CRITERIA.

    (a) Considerations.--Section 224(a) of the Appalachian Regional 
Development Act of 1965 (40 U.S.C. App. 224(a)) is amended by inserting 
before the semicolon at the end of paragraph (1) the following: ``or in 
a severely and persistently distressed and underdeveloped county or 
area''.
    (b) Outcome Measurements.--Section 224(a) of such Act is further 
amended--
            (1) by striking the period at the end of paragraph (5) and 
        inserting ``; and''; and
            (2) by adding at the end the following:
            ``(6) the extent to which the project design provides for 
        detailed outcome measurements by which grant expenditures may 
        be justified.''.
    (c) Removal of Limitations.--Section 224(b) of such Act (40 U.S.C. 
App. 224(b)) is amended to read as follows:
    ``(b) Limitation.--No financial assistance made available under 
this Act may be used to assist establishments relocating from one area 
to another.''.

SEC. 10538. DISTRESSED AND ECONOMICALLY COMPETITIVE COUNTIES.

    Part C of title II of the Appalachian Regional Development Act of 
1965 (40 U.S.C. App. 221-225) is amended by adding at the end the 
following:

``SEC. 226. DISTRESSED AND ECONOMICALLY COMPETITIVE COUNTIES.

    ``(a) Designations.--Not later than 90 days after the effective 
date of the Economic Development Partnership Act of 1995, and annually 
thereafter, the Commission, in accordance with such criteria as the 
Commission may establish, shall--
            ``(1) designate as `distressed counties' those counties in 
        the region that are the most severely and persistently 
        distressed and underdeveloped; and
            ``(2) designate as `economically competitive counties' 
        those counties in the region which have attained substantial 
        economic parity with the rest of the Nation.
    ``(b) Period of Effectiveness.--In making annual designations under 
subsection (a), the Commission may discontinue an existing designation 
at the discretion of the Commission; except that any designation of a 
distressed county shall remain in effect for the 3-year period 
beginning on the date of the designation.
    ``(c) Funding Prohibition for Projects Located in Economically 
Competitive Counties.--
            ``(1) In general.--Except as provided by paragraph (2), no 
        funds may be provided under this Act for a project located in a 
        county for which an economically competitive county designation 
        is in effect under this section.
            ``(2) Exceptions.--The prohibition established by paragraph 
        (1) shall not apply to--
                    ``(A) projects on the Appalachian development 
                highway system authorized by section 201;
                    ``(B) local development district administrative 
                projects authorized by section 302(a)(1); or
                    ``(C) discretionary grants authorized by section 
                302(a).''.

SEC. 10539. GRANTS FOR ADMINISTRATIVE EXPENSES AND COMMISSION PROJECTS.

    (a) Availability of Amounts.--Section 302(a) of the Appalachian 
Regional Development Act of 1965 (40 U.S.C. App. 302(a)) is amended--
            (1) by striking ``The President'' and inserting ``The 
        Commission''; and
            (2) in paragraphs (1), (2), and (3) by striking ``to the 
        Commission'' each place it appears.
    (b) Cost Sharing.--Section 302(a) of such Act is further amended--
            (1) in paragraph (1) by striking ``75 per centum'' and 
        inserting ``50 percent''; and
            (2) by adding at the end the following: ``After September 
        30, 1995, not more than 50 percent of the cost of any activity 
        eligible for financial assistance under this section may be 
        provided from funds appropriated to carry out this Act (or 80 
        percent of such costs in the case of a project to be carried 
        out in a county for which a distressed county designation is in 
        effect under section 226); except that discretionary grants by 
        the Commission to implement significant regional initiatives, 
        to take advantage of special development opportunities, or to 
        respond to emergency economic distress in the region may be 
        made without regard to such percentage limitations. The 
        aggregate amount of discretionary grants referred to in the 
        preceding sentence in any fiscal year shall not exceed 10 
        percent of the amounts appropriated under section 401 for such 
        fiscal year.''.
    (c) Repeals.--Section 302 of such Act (40 U.S.C. App. 302) is 
amended--
            (1) by striking paragraphs (3) and (4) of subsection (b);
            (2) by striking subsection (d); and
            (3) by striking subsection (e).

SEC. 10540. AUTHORIZATION OF APPROPRIATIONS FOR GENERAL PROGRAM.

    Section 401 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 401) is amended to read as follows:

``SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

    ``In addition to the appropriations authorized by section 105 for 
administrative expenses and by section 201(g) for the Appalachian 
development highway system and local access roads, there is authorized 
to be appropriated to the Commission to carry out this Act $88,355,000 
per fiscal year for each of fiscal years 1996 through 2000. Such sums 
shall remain available until expended.''.

SEC. 10541. EXTENSION OF TERMINATION DATE.

    Section 405 of the Appalachian Regional Development Act of 1965 (40 
U.S.C. App. 405) is amended by striking ``1982'' and inserting 
``2000''.

                TITLE XI--COMMITTEE ON VETERANS' AFFAIRS

SEC. 11001. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This title may be cited as the ``Veterans 
Reconciliation Act of 1995''.
    (b) Table of Contents.--The contents of this title are as follows:

                TITLE XI--COMMITTEE ON VETERANS' AFFAIRS

Sec. 11001. Short title; table of contents.

             Subtitle A--Extension of Temporary Authorities

Sec. 11011. Authority to require that certain veterans agree to make 
copayments in exchange for receiving health-care benefits.
Sec. 11012. Medical care cost recovery authority.
Sec. 11013. Income verification authority.
Sec. 11014. Limitation on pension for certain recipients of medicaid-
covered nursing home care.
Sec. 11015. Home loan fees.
Sec. 11016. Procedures applicable to liquidation sales on defaulted 
home loans guaranteed by the Department of Veterans Affairs.

                       Subtitle B--Other Matters

Sec. 11021. Revision to prescription drug copayment.
Sec. 11022. Rounding down of cost-of-living adjustments in compensation 
and DIC rates.
Sec. 11023. Revised standard for liability for injuries resulting from 
Department of Veterans Affairs treatment.
Sec. 11024. Enhanced loan asset sale authority.
Sec. 11025. Withholding of payments and benefits.

               Subtitle C--Health Care Eligibility Reform

Sec. 11031. Hospital care and medical services.
Sec. 11032. Extension of authority to priority health care for Persian 
Gulf veterans.
Sec. 11033. Prosthetics.
Sec. 11034. Management of health care.
Sec. 11035. Improved efficiency in health care resource management.
Sec. 11036. Sharing agreements for specialized medical resources.
Sec. 11037. Personnel furnishing shared resources.

             Subtitle A--Extension of Temporary Authorities

SEC. 11011. AUTHORITY TO REQUIRE THAT CERTAIN VETERANS AGREE TO MAKE 
                    COPAYMENTS IN EXCHANGE FOR RECEIVING HEALTH-CARE 
                    BENEFITS.

    (a) Hospital and Medical Care.--Section 8013(e) of the Omnibus 
Budget Reconciliation Act of 1990 (38 U.S.C. 1710 note) is amended by 
striking out ``September 30, 1998'' and inserting in lieu thereof 
``September 30, 2002''.
    (b) Outpatient Medications.--Section 1722A(c) of title 38, United 
States Code, is amended by striking out ``September 30, 1998'' and 
inserting in lieu thereof ``September 30, 2002''.

SEC. 11012. MEDICAL CARE COST RECOVERY AUTHORITY.

    Section 1729(a)(2)(E) of title 38, United States Code, is amended 
by striking out ``before October 1, 1998,'' and inserting ``before 
October 1, 2002,''.

SEC. 11013. INCOME VERIFICATION AUTHORITY.

    (a) Title 38.--Section 5317(g) of title 38, United States Code, is 
amended by striking out ``September 30, 1998'' and inserting in lieu 
thereof ``September 30, 2002''.
    (b) Internal Revenue Code of 1986.--Section 6103(l)(7)(D) of the 
Internal Revenue Code of 1986 is amended by striking out ``Clause 
(viii) shall not apply after September 30, 1998'' and inserting in lieu 
thereof ``Clause (viii) shall not apply after September 30, 2002''.

SEC. 11014. LIMITATION ON PENSION FOR CERTAIN RECIPIENTS OF MEDICAID-
                    COVERED NURSING HOME CARE.

    Section 5503(f)(7) of title 38, United States Code, is amended by 
striking out ``September 30, 1998'' and inserting in lieu thereof 
``September 30, 2002''.

SEC. 11015. HOME LOAN FEES.

    Section 3729(a) of title 38, United States Code, is amended--
            (1) in paragraph (4), by striking out ``October 1, 1998'' 
        and inserting in lieu thereof ``October 1, 2002''; and
            (2) in paragraph (5)(C), by striking out ``October 1, 
        1998'' and inserting in lieu thereof ``October 1, 2002''.

SEC. 11016. PROCEDURES APPLICABLE TO LIQUIDATION SALES ON DEFAULTED 
                    HOME LOANS GUARANTEED BY THE DEPARTMENT OF VETERANS 
                    AFFAIRS.

    Section 3732(c)(11) of title 38, United States Code, is amended by 
striking out ``October 1, 1998'' and inserting ``October 1, 2002''.

                       Subtitle B--Other Matters

SEC. 11021. REVISION TO PRESCRIPTION DRUG COPAYMENT.

    (a) Increase in Amount of Copayment.--Section 1722A(a) of title 38, 
United States Code, is amended--
            (1) in paragraph (1), by striking out ``$2'' and inserting 
        in lieu thereof ``$3'';
            (2) by striking out paragraph (2); and
            (3) by redesignating paragraph (3) as paragraph (2).
    (b) Recovery of Indebtedness.--(1) Section 5302 of such title is 
amended by adding at the end the following new subsection:
    ``(f) The Secretary may not waive under this section the recovery 
of any payment or the collection of any indebtedness owed under section 
1722A of this title.''.
    (2) The amendment made by paragraph (1) shall apply with respect to 
amounts that become due to the United States under section 1722A of 
title 38, United States Code, on or after the date of the enactment of 
this Act.

SEC. 11022. ROUNDING DOWN OF COST-OF-LIVING ADJUSTMENTS IN COMPENSATION 
                    AND DIC RATES.

    (a) Fiscal Year 1996 COLA.--(1) Effective as of December 1, 1995, 
the Secretary of Veterans Affairs shall recompute any increase in an 
adjustment that is otherwise provided by law to be effective during 
fiscal year 1996 in the rates of disability compensation and dependency 
and indemnity compensation paid by the Secretary as such rates were in 
effect on November 30, 1995. The recomputation shall provide for the 
same percentage increase as provided under such law, but with amounts 
so recomputed (if not a whole dollar amount) rounded down to the next 
lower whole dollar amount (rather than to the nearest whole dollar 
amount) and with each old-law DIC rate increased by the amount by which 
the new-law DIC rate is increased (rather than by a uniform 
percentage).
    (2) For purposes of paragraph (1):
            (A) The term ``old-law DIC rate'' means a dollar amount in 
        effect under section 1311(a)(3) of title 38, United States 
        Code.
            (B) The term ``new-law DIC rate'' means the dollar amount 
        in effect under section 1311(a)(1) of title 38, United States 
        Code.
    (b) Out-Year Compensation COLAs.--(1) Chapter 11 of title 38, 
United States Code, is amended by inserting after section 1102 the 
following new section:

``Sec. 1103. Cost-of-living adjustments

    ``(a) In the computation of cost-of-living adjustments for fiscal 
years 1997 through 2002 in the rates of, and dollar limitations 
applicable to, compensation payable under this chapter, such 
adjustments shall be made by a uniform percentage that is no more than 
the percentage equal to the social security increase for that fiscal 
year, with all increased monthly rates and limitations (other than 
increased rates or limitations equal to a whole dollar amount) rounded 
down to the next lower whole dollar amount.
    ``(b) For purposes of this section, the term `social security 
increase' means the percentage by which benefit amounts payable under 
title II of the Social Security Act (42 U.S.C. 401 et seq.) are 
increased for any fiscal year as a result of a determination under 
section 215(i) of such Act (42 U.S.C. 415(i)).''.
    (2) The table of sections at the beginning of such chapter is 
amended by inserting after the item relating to section 1102 the 
following new item:

``1103. Cost-of-living adjustments.''.

    (c) Out-Year DIC COLAs.--(1) Chapter 13 of title 38, United States 
Code, is amended by inserting after section 1302 the following new 
section:

``Sec. 1303. Cost-of-living adjustments

    ``(a) In the computation of cost-of-living adjustments for fiscal 
years 1997 through 2002 in the rates of dependency and indemnity 
compensation payable under this chapter, such adjustments (except as 
provided in subsection (b)) shall be made by a uniform percentage that 
is no more than the percentage equal to the social security increase 
for that fiscal year, with all increased monthly rates (other than 
increased rates equal to a whole dollar amount) rounded down to the 
next lower whole dollar amount.
    ``(b)(1) Cost-of-living adjustments for each of fiscal years 1997 
through 2002 in old-law DIC rates shall be in a whole dollar amount 
that is no greater than the amount by which the new-law DIC rate is 
increased for that fiscal year as determined under subsection (a).
    ``(2) For purposes of paragraph (1):
            ``(A) The term `old-law DIC rates' means the dollar amounts 
        in effect under section 1311(a)(3) of this title.
            ``(B) The term `new-law DIC rate' means the dollar amount 
        in effect under section 1311(a)(1) of this title.
    ``(c) For purposes of this section, the term `social security 
increase' means the percentage by which benefit amounts payable under 
title II of the Social Security Act (42 U.S.C. 401 et seq.) are 
increased for any fiscal year as a result of a determination under 
section 215(i) of such Act (42 U.S.C. 415(i)).''.
    (2) The table of sections at the beginning of such chapter is 
amended by inserting after the item relating to section 1302 the 
following new item:

``1303. Cost-of-living adjustments.''.

SEC. 11023. REVISED STANDARD FOR LIABILITY FOR INJURIES RESULTING FROM 
                    DEPARTMENT OF VETERANS AFFAIRS TREATMENT.

    (a) Revised Standard.--Section 1151 of title 38, United States 
Code, is amended--
            (1) by designating the second sentence as subsection (c);
            (2) by striking out the first sentence and inserting in 
        lieu thereof the following:
    ``(a) Compensation under this chapter and dependency and indemnity 
compensation under chapter 13 of this title shall be awarded for a 
qualifying additional disability of a veteran or the qualifying death 
of a veteran in the same manner as if such disability or death were 
service-connected.
    ``(b)(1) For purposes of this section, a disability or death is a 
qualifying additional disability or a qualifying death only if the 
disability or death--
            ``(A) was caused by Department health care and was a 
        proximate result of--
                    ``(i) negligence on the part of the Department in 
                furnishing the Department health care; or
                    ``(ii) an event not reasonably foreseeable; or
            ``(B) was incurred as a proximate result of the provision 
        of training and rehabilitation services by the Secretary 
        (including by a service-provider used by the Secretary for such 
        purpose under section 3115 of this title) as part of an 
        approved rehabilitation program under chapter 31 of this title.
    ``(2) For purposes of this section, the term `Department health 
care' means hospital care, medical or surgical treatment, or an 
examination that is furnished under any law administered by the 
Secretary to a veteran by a Department employee or in a Department 
facility (as defined in section 1701(3)(A) of this title).
    ``(3) A disability or death of a veteran which is the result of the 
veteran's willful misconduct is not a qualifying disability or death 
for purposes of this section.''; and
            (3) by adding at the end the following:
    ``(d) Effective with respect to injuries, aggravations of injuries, 
and deaths occurring after September 30, 2002, a disability or death is 
a qualifying additional disability or a qualifying death for purposes 
of this section (notwithstanding the provisions of subsection (b)(1)) 
if the disability or death--
            ``(1) was the result of Department health care; or
            ``(2) was the result of the pursuit of a course of 
        vocational rehabilitation under chapter 31 of this title.''.
    (b) Conforming Amendments.--Subsection (c) of such section, as 
designated by subsection (a)(1), is amended--
            (1) by striking out ``, aggravation,'' both places it 
        appears; and
            (2) by striking out ``sentence'' and inserting in lieu 
        thereof ``subsection''.
    (c) Effective Date.--The amendments made by this section shall 
apply to any administrative or judicial determination of eligibility 
for benefits under section 1151 of title 38, United States Code, based 
on a claim that is received by the Secretary on or after October 1, 
1995, including any such determination based on an original application 
or an application seeking to reopen, revise, reconsider, or otherwise 
readjudicate any claim for benefits under section 1151 of that title or 
any predecessor provision of law.

SEC. 11024. ENHANCED LOAN ASSET SALE AUTHORITY.

    Section 3720(h)(2) of title 38, United States Code, is amended by 
striking out ``December 31, 1995'' and inserting in lieu thereof 
``September 30, 1996''.

SEC. 11025. WITHHOLDING OF PAYMENTS AND BENEFITS.

    (a) Notice Required in Lieu of Consent or Court Order.--Section 
3726 of title 38, United States Code, is amended by striking out 
``unless'' and all that follows and inserting in lieu thereof the 
following: ``unless the Secretary provides such veteran or surviving 
spouse with notice by certified mail with return receipt requested of 
the authority of the Secretary to waive the payment of indebtedness 
under section 5302(b) of this title. If the Secretary does not waive 
the entire amount of the liability, the Secretary shall then determine 
whether the veteran or surviving spouse should be released from 
liability under section 3713(b) of this title. If the Secretary 
determines that the veteran or surviving spouse should not be released 
from liability, the Secretary shall notify the veteran or surviving 
spouse of that determination and provide a notice of the procedure for 
appealing that determination, unless the Secretary has previously made 
such determination and notified the veteran or surviving spouse of the 
procedure for appealing the determination.''.
    (b) Conforming Amendment.--Section 5302(b) of such title is amended 
by inserting ``with return receipt requested'' after ``certified 
mail''.
    (c) Effective Date.--The amendments made by this section shall 
apply with respect to any indebtedness to the United States arising 
pursuant to chapter 37 of title 38, United States Code, before, on, or 
after the date of the enactment of this Act.

               Subtitle C--Health Care Eligibility Reform

SEC. 11031. HOSPITAL CARE AND MEDICAL SERVICES.

    (a) Eligibility for Care.--Section 1710(a) of title 38, United 
States Code, is amended by striking out paragraphs (1) and (2) and 
inserting the following:
    ``(a)(1) The Secretary shall, to the extent and in the amount 
provided in advance in appropriations Acts for these purposes, provide 
hospital care and medical services, and may provide nursing home care, 
which the Secretary determines is needed to any veteran--
            ``(A) with a compensable service-connected disability;
            ``(B) whose discharge or release from active military, 
        naval, or air service was for a compensable disability that was 
        incurred or aggravated in the line of duty;
            ``(C) who is in receipt of, or who, but for a suspension 
        pursuant to section 1151 of this title (or both a suspension 
        and the receipt of retired pay), would be entitled to 
        disability compensation, but only to the extent that such 
        veteran's continuing eligibility for such care is provided for 
        in the judgment or settlement provided for in such section;
            ``(D) who is a former prisoner of war;
            ``(E) of the Mexican border period or of World War I;
            ``(F) who was exposed to a toxic substance, radiation, or 
        environmental hazard, as provided in subsection (e); and
            ``(G) who is unable to defray the expenses of necessary 
        care as determined under section 1722(a) of this title.
    ``(2) In the case of a veteran who is not described in paragraph 
(1), the Secretary may, to the extent resources and facilities are 
available and subject to the provisions of subsection (f), furnish 
hospital care, medical services, and nursing home care which the 
Secretary determines is needed.''.
    (b) Conforming Amendments.--(1) Section 1710(e) of such title is 
amended--
            (A) in paragraph (1), by striking out ``hospital care and 
        nursing home care'' in subparagraphs (A), (B), and (C) and 
        inserting in lieu thereof ``hospital care, medical services, 
        and nursing home care'';
            (B) in paragraph (2), by inserting ``and medical services'' 
        after ``Hospital and nursing home care''; and
            (C) by striking out ``subsection (a)(1)(G) of this 
        section'' each place it appears and inserting in lieu thereof 
        ``subsection (a)(1)(F)''.
    (2) Chapter 17 of such title is amended--
            (A) by redesignating subsection (g) of section 1710 as 
        subsection (h); and
            (B) by transferring subsection (f) of section 1712 of such 
        title to section 1710 so as to appear after subsection (f), 
        redesignating such subsection as subsection (g), and amending 
        such subsection by striking out ``section 1710(a)(2) of this 
        title'' in paragraph (1) and inserting in lieu thereof 
        ``subsection (a)(2) of this section''.
    (3) Section 1712 of such title is amended--
            (A) by striking out subsections (a) and (i); and
            (B) by redesignating subsections (b), (c), (d), (h) and 
        (j), as subsections (a), (b), (c), (d), and (e), respectively.

SEC. 11032. EXTENSION OF AUTHORITY TO PRIORITY HEALTH CARE FOR PERSIAN 
                    GULF VETERANS.

    Section 1710(e)(3) of title 38, United States Code, is amended by 
striking out ``December 31, 1995'' and inserting in lieu thereof 
``December 31, 1998''.

SEC. 11033. PROSTHETICS.

    (a) Eligibility for Prosthetics.--Section 1701(6)(A)(i) of title 
38, United States Code, is amended--
            (1) by striking out ``(in the case of a person otherwise 
        receiving care or services under this chapter)'' and ``(except 
        under the conditions described in section 1712(a)(5)(A) of this 
        title),'';
            (2) by inserting ``(in the case of a person otherwise 
        receiving care or services under this chapter)'' before 
        ``wheelchairs,''; and
            (3) by inserting ``except that the Secretary may not 
        furnish sensori-neural aids other than in accordance with 
        guidelines which the Secretary shall prescribe,'' after 
        ``reasonable and necessary,''.
    (b) Regulations.--Not later than 30 days after the date of the 
enactment of this Act, the Secretary of Veterans Affairs shall 
prescribe the guidelines required by the amendments made by subsection 
(a) and shall furnish a copy of those guidelines to the Committees on 
Veterans' Affairs of the Senate and House of Representatives.

SEC. 11034. MANAGEMENT OF HEALTH CARE.

    (a) In General.--(1) Chapter 17 of title 38, United States Code, is 
amended by inserting after section 1704 the following new sections:

``Sec. 1705. Management of health care: patient enrollment system

    ``(a) In managing the provision of hospital care and medical 
services under section 1710(a)(1) of this title, the Secretary, in 
accordance with regulations the Secretary shall prescribe, shall 
establish and operate a system of annual patient enrollment. The 
Secretary shall manage the enrollment of veterans in accordance with 
the following priorities, in the order listed:
            ``(1) Veterans with service-connected disabilities rated 30 
        percent or greater.
            ``(2) Veterans who are former prisoners of war and veterans 
        with service connected disabilities rated 10 percent or 20 
        percent.
            ``(3) Veterans who are in receipt of increased pension 
        based on a need of regular aid and attendance or by reason of 
        being permanently housebound and other veterans who are 
        catastrophically disabled.
            ``(4) Veterans not covered by paragraphs (1) through (3) 
        who are unable to defray the expenses of necessary care as 
        determined under section 1722(a) of this title.
            ``(5) All other veterans eligible for hospital care, 
        medical services, and nursing home care under section 
        1710(a)(1) of this title.
    ``(b) In the design of an enrollment system under subsection (a), 
the Secretary--
            ``(1) shall ensure that the system will be managed in a 
        manner to ensure that the provision of care to enrollees is 
        timely and acceptable in quality;
            ``(2) may establish additional priorities within each 
        priority group specified in subsection (a), as the Secretary 
        determines necessary; and
            ``(3) may provide for exceptions to the specified 
        priorities where dictated by compelling medical reasons.

``Sec. 1706. Management of health care: other requirements

    ``(a) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary shall, to 
the extent feasible, design, establish and manage health care programs 
in such a manner as to promote cost-effective delivery of health care 
services in the most clinically appropriate setting.
    ``(b) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary--
            ``(1) may contract for hospital care and medical services 
        when Department facilities are not capable of furnishing such 
        care and services economically, and
            ``(2) shall make such rules and regulations regarding 
        acquisition procedures or policies as the Secretary considers 
        appropriate to provide such needed care and services.
    ``(c) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary shall 
ensure that the Department maintains its capacity to provide for the 
specialized treatment and rehabilitative needs of disabled veterans 
described in section 1710(a) of this title (including veterans with 
spinal cord dysfunction, blindness, amputations, and mental illness) 
within distinct programs or facilities of the Department that are 
dedicated to the specialized needs of those veterans in a manner that 
(1) affords those veterans reasonable access to care and services for 
those specialized needs, and (2) ensures that overall capacity of the 
Department to provide such services is not reduced below the capacity 
of the Department, nationwide, to provide those services, as of the 
date of the enactment of this section.
    ``(d) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary shall 
ensure that any veteran with a service-connected disability is provided 
all benefits under this chapter for which that veteran was eligible 
before the date of the enactment of this section.''.
    (2) The table of sections at the beginning of chapter 17 of such 
title is amended by inserting after the item relating to section 1704 
the following new items:

``1705. Management of health care: patient enrollment system.
``1706. Management of health care: other requirements.''.

    (b) Conforming Amendments to Section 1703.--(1) Section 1703 of 
such title is amended--
            (A) by striking out subsections (a) and (b); and
            (B) in subsection (c) by--
                    (i) striking out ``(c)'', and
                    (ii) striking out ``this section, sections'' and 
                inserting in lieu thereof ``sections 1710,''.
    (2)(A) The heading of such section is amended to read as follows:

``Sec. 1703. Annual report on furnishing of care and services by 
                    contract''.

    (B) The item relating to such section in the table of sections at 
the beginning of chapter 17 of such title is amended to read as 
follows:

``1703. Annual report on furnishing of care and services by 
contract.''.

SEC. 11035. IMPROVED EFFICIENCY IN HEALTH CARE RESOURCE MANAGEMENT.

    (a) Repeal of Sunset Provision.--Section 204 of the Veterans Health 
Care Act of 1992 (Public Law 102-585; 106 Stat. 4950) is repealed.
    (b) Cost Recovery.--Title II of such Act is further amended by 
adding at the end the following new section:

``SEC. 207. AUTHORITY TO BILL HEALTH-PLAN CONTRACTS.

    ``(a) Right To Recover.--In the case of a primary beneficiary (as 
described in section 201(2)(B)) who has coverage under a health-plan 
contract, as defined in section 1729(i)(1)(A) of title 38, United 
States Code, and who is furnished care or services by a Department 
medical facility pursuant to this title, the United States shall have 
the right to recover or collect charges for such care or services from 
such health-plan contract to the extent that the beneficiary (or the 
provider of the care or services) would be eligible to receive payment 
for such care or services from such health-plan contract if the care or 
services had not been furnished by a department or agency of the United 
States. Any funds received from such health-plan contract shall be 
credited to funds that have been allotted to the facility that 
furnished the care or services.
    ``(b) Enforcement.--The right of the United States to recover under 
such a beneficiary's health-plan contract shall be enforceable in the 
same manner as that provided by subsections (a)(3), (b), (c)(1), (d), 
(f), (h), and (i) of section 1729 of title 38, United States Code.''.

SEC. 11036. SHARING AGREEMENTS FOR SPECIALIZED MEDICAL RESOURCES.

    (a) Repeal of Section 8151.--(1) Subchapter IV of chapter 81 of 
title 38, United States Code, is amended--
            (A) by striking out section 8151; and
            (B) by redesignating sections 8152, 8153, 8154, 8155, 8156, 
        8157, and 8158 as sections 8151, 8152, 8153, 8154, 8155, 8156, 
        and 8157, respectively.
    (2) The table of sections at the beginning of chapter 81 is 
amended--
            (A) by striking out the item relating to section 8151; and
            (B) by revising the items relating to sections 8152, 8153, 
        8154, 8155, 8156, 8157, and 8158 to reflect the redesignations 
        by paragraph (1)(B).
    (b) Revised Authority for Sharing Agreements.--Section 8152 of such 
title, as redesignated by subsection (a)(1)(B), is amended--
            (1) in subsection (a)(1)(A)--
                    (A) by striking out ``specialized medical 
                resources'' and inserting in lieu thereof ``health-care 
                resources''; and
                    (B) by striking out ``other'' and all that follows 
                through ``medical schools'' and inserting in lieu 
                thereof ``any medical school, health-care provider, 
                health-care plan, insurer, or other entity or 
                individual'';
            (2) in subsection (a)(2) by striking out ``only'' and all 
        that follows through ``are not'' and inserting in lieu thereof 
        ``if such resources are not, or would not be,'';
            (3) in subsection (b), by striking out ``reciprocal 
        reimbursement'' in the first sentence and all that follows 
        through the period at the end of that sentence and inserting in 
        lieu thereof ``payment to the Department in accordance with 
        procedures that provide appropriate flexibility to negotiate 
        payment which is in the best interest of the Government.'';
            (4) in subsection (d), by striking out ``preclude such 
        payment, in accordance with--'' and all that follows through 
        ``to such facility therefor'' and inserting in lieu thereof 
        ``preclude such payment to such facility for such care or 
        services'';
            (5) by redesignating subsection (e) as subsection (f); and
            (6) by inserting after subsection (d) the following new 
        subsection (e):
    ``(e) The Secretary may make an arrangement that authorizes the 
furnishing of services by the Secretary under this section to 
individuals who are not veterans only if the Secretary determines--
            ``(1) that such an arrangement will not result in the 
        denial of, or a delay in providing access to, care to any 
        veteran at that facility; and
            ``(2) that such an arrangement--
                    ``(A) is necessary to maintain an acceptable level 
                and quality of service to veterans at that facility; or
                    ``(B) will result in the improvement of services to 
                eligible veterans at that facility.''.
    (c) Cross-Reference Amendments.--(1) Section 8110(c)(3)(A) of such 
title is amended by striking out ``8153'' and inserting in lieu thereof 
``8152''.
    (2) Subsection (b) of section 8154 of such title (as redesignated 
by subsection (a)(1)(B)) is amended by striking out ``section 8154'' 
and inserting in lieu thereof ``section 8153''.
    (3) Section 8156 of such title (as redesignated by subsection 
(a)(1)(B)) is amended--
            (A) in subsection (a), by striking out ``section 8153(a)'' 
        and inserting in lieu thereof ``section 8152(a)''; and
            (B) in subsection (b)(3), by striking out ``section 8153'' 
        and inserting in lieu thereof ``section 8152''.
    (4) Subsection (a) of section 8157 of such title (as redesignated 
by subsection (a)(1)(B)) is amended--
            (A) in the matter preceding paragraph (1), by striking out 
        ``section 8157'' and ``section 8153(a)'' and inserting in lieu 
        thereof ``section 8156'' and ``section 8152(a)'', respectively; 
        and
            (B) in paragraph (1), by striking out ``section 
        8157(b)(4)'' and inserting in lieu thereof ``section 
        8156(b)(4)''.

SEC. 11037. PERSONNEL FURNISHING SHARED RESOURCES.

    Section 712(b)(2) of title 38, United States Code, is amended--
            (1) by striking out ``the sum of--'' and inserting in lieu 
        thereof ``the sum of the following:'';
            (2) by capitalizing the first letter of the first word of 
        each of subparagraphs (A) and (B);
            (3) by striking out ``; and'' at the end of subparagraph 
        (A) and inserting in lieu thereof a period; and
            (4) by adding at the end the following:
                    ``(C) The number of such positions in the 
                Department during that fiscal year held by persons 
                involved in providing health-care resources under 
                section 8111 or 8152 of this title.''.

                            TITLE XII--TRADE

  Subtitle A--Technical Corrections and Miscellaneous Trade Provisions

SEC. 12001. PAYMENT OF DUTIES AND FEES.

    (a) Interest Accrual.--Section 505(c) of the Tariff Act of 1930 (19 
U.S.C. 1505(c)) is amended in the second sentence by inserting after 
``duties, fees, and interest'' the following: ``or, in a case in which 
a claim is made under section 520(d), from the date on which such claim 
is made,''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
apply to claims made pursuant to section 520(d) of the Tariff Act of 
1930 on or after April 25, 1995.

SEC. 12002. OTHER TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Examination of Books and Witnesses.--Section 509(a)(2) of the 
Tariff Act of 1930 (19 U.S.C. 1509(a)(2)) is amended by striking 
``(c)(1)(A)'' and inserting ``(d)(1)(A)''.
    (b) Requirement for Certificate for Importation of Alcoholic 
Liquors in Small Vessels.--Section 7 of the Act of August 5, 1935 (19 
U.S.C. 1707; 49 Stat. 520), is repealed.
    (c) Manifests.--Section 431(c)(1) of the Tariff Act of 1930 (19 
U.S.C. 1431(c)(1)) is amended in the matter preceding subparagraph (A) 
by striking ``such manifest'' and inserting ``a vessel manifest''.
    (d) Documentation for Entry of Merchandise.--Section 484(a)(1) of 
the Tariff Act of 1930 (19 U.S.C. 1484(a)(1)) is amended in the matter 
preceding subparagraph (A) by striking ``553, and 336(j)'' and 
inserting ``and 553''.
    (e) Penalties for Certain Violations.--Section 592 of the Tariff 
Act of 1930 (19 U.S.C. 1592) is amended--
            (1) in subsection (a)(1), by striking ``lawful duty'' and 
        inserting ``lawful duty, tax, or fee''; and
            (2) in subsections (b)(1)(A)(vi), (c)(2)(A)(ii), 
        (c)(3)(A)(ii), (c)(4)(A)(i), and (c)(4)(B) by striking ``lawful 
        duties'' each place it appears and inserting ``lawful duties, 
        taxes, and fees''.
    (f) Deprivation of Lawful Duties, Taxes, or Fees.--Section 592(d) 
of the Tariff Act of 1930 (19 U.S.C. 1592(d)) is amended by striking 
``or fees be restored'' and inserting ``and fees be restored''.
    (g) Reconciliation Treated as Entry for Recordkeeping.--
            (1) Section 401(s) of the Tariff Act of 1930 (19 U.S.C. 
        1401(s)) is amended by inserting ``recordkeeping,'' after 
        ``reliquidation,''.
            (2) Section 508(c)(1) of such Act (19 U.S.C. 1508(c)(1)) is 
        amended by inserting ``, filing of a reconciliation,'' after 
        ``entry''.
    (h) Extension of Liquidation.--Section 504(d) of the Tariff Act of 
1930 (19 U.S.C. 1504(d)) is amended by inserting ``, unless liquidation 
is extended under subsection (b),'' after ``shall liquidate the 
entry''.
    (i) Exemption From Duty for Personal and Household Goods 
Accompanying Returning Residents.--Section 321(a)(2)(B) of the Tariff 
Act of 1930 (19 U.S.C. 1321(a)(2)(B)) is amended by inserting ``, 
9804.00.65,'' after ``9804.00.30''.
    (j) Debt Collection.--Section 631(a) of the Tariff Act of 1930 (19 
U.S.C. 1631(a)) is amended--
            (1) by inserting after ``law,'' the following: ``including 
        section 3302 of title 31, United States Code, and subchapters I 
        and II of chapter 37 of such title,''; and
            (2) by inserting ``and the expenses associated with 
        recovering such indebtedness,'' after ``Government,''.
    (k) Examination of Books and Witnesses.--Section 509(b) of the 
Tariff Act of 1930 (19 U.S.C. 1509(b)) is amended in paragraphs (3) and 
(4) by striking ``appropriate regional commissioner'' and inserting 
``officer designated pursuant to regulations''.
    (l) Review of Protests.--Section 515(d) of the Tariff Act of 1930 
(19 U.S.C. 1515(d)) is amended by striking ``district director'' and 
inserting ``port director''.
    (m) Effective Date.--The amendments made by this section apply as 
of December 8, 1993.

SEC. 12003. CLARIFICATION REGARDING THE APPLICATION OF CUSTOMS USER 
                    FEES.

    (a) In General.--Subparagraph (D) of section 13031(b)(8) of the 
Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 
58c(b)(8)(D)) is amended--
            (1) in clause (iv)--
                    (A) by striking ``subparagraph 9802.00.80 of such 
                Schedules'' and inserting ``heading 9802.00.80 of such 
                Schedule''; and
                    (B) by striking ``and'' at the end of clause (iv);
            (2) by striking the period at the end of clause (v) and 
        inserting ``; and''; and
            (3) by inserting after clause (v) the following new clause:
            ``(vi) in the case of merchandise entered from a foreign 
        trade zone (other than merchandise to which clause (v) 
        applies), be applied only to the value of the privileged or 
        nonprivileged foreign status merchandise under section 3 of the 
        Act of June 18, 1934 (commonly known as the Foreign Trade Zones 
        Act, 19 U.S.C. 81c).''.
    (b) Effective Date.--The amendments made by subsection (a) apply 
to--
            (1) any entry made from a foreign trade zone on or after 
        the 15th day after the date of the enactment of this Act; and
            (2) any entry made from a foreign trade zone after November 
        30, 1986, and before such 15th day if liquidation of the entry 
        was not final before such 15th day.
    (c) Application of Fees to Certain Agricultural Products.--The 
amendment made by section 111(b)(2)(D)(iv) of the Customs and Trade Act 
of 1990 shall apply to--
            (1) any entry made from a foreign trade zone on or after 
        the 15th day after the date of the enactment of this Act; and
            (2) any entry made from a foreign trade zone after November 
        30, 1986, and before such 15th day if the liquidation of the 
        entry was not final before such 15th day.

SEC. 12004. TECHNICAL AMENDMENT TO THE CUSTOMS AND TRADE ACT OF 1990.

    Subsection (b) of section 484H of the Customs and Trade Act of 1990 
(19 U.S.C. 1553 note) is amended by striking ``, or withdrawn from 
warehouse for consumption,'' and inserting ``for transportation in 
bond''.

SEC. 12005. TECHNICAL AMENDMENTS REGARDING CERTAIN BENEFICIARY 
                    COUNTRIES.

    (a) Caribbean Basin Economic Recovery Act.--Section 213(h)(1) of 
the Caribbean Basin Economic Recovery Act (19 U.S.C. 2703(h)(1)) is 
amended by adding at the end thereof the following flush sentence:
``The duty reductions provided for under this paragraph shall not apply 
to textile and apparel articles which are subject to textile 
agreements.''.
    (b) Andean Trade Preference Act.--Section 204(c)(1) of the Andean 
Trade Preference Act (19 U.S.C. 3203(c)(1)) is amended by adding at the 
end thereof the following flush sentence:
``The duty reductions provided for under this paragraph shall not apply 
to textile and apparel articles which are subject to textile 
agreements.''
    (c) Effective Date.--The amendments made by this section apply with 
respect to--
            (1) articles entered, or withdrawn from warehouse for 
        consumption, on or after the 15th day after the date of the 
        enactment of this Act, and
            (2) articles entered after December 31, 1991, and before 
        such 15th day, if the liquidation of the entry of such articles 
        was not final before such 15th day.

SEC. 12006. CLARIFICATION OF FEES FOR CERTAIN CUSTOMS SERVICES.

    (a) In General.--Section 13031(b)(9)(A) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(9)(A)) is amended--
            (1) by striking ``centralized hub facility or'' in clause 
        (i); and
            (2) in clause (ii)--
                    (A) by striking ``facility--'' and inserting 
                ``facility or centralized hub facility--'',
                    (B) by striking ``customs inspectional'' in 
                subclause (I), and
                    (C) by striking ``at the facility'' in subclause 
                (I) and inserting ``for the facility''.
    (b) Definitions.--Section 13031(b)(9)(B)(i) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(9)(B)(i)) 
is amended--
            (1) by striking ``, as in effect on July 30, 1990'', and
            (2) by adding at the end thereof the following new 
        sentence: ``Nothing in this paragraph shall be construed as 
        prohibiting the Secretary of the Treasury from processing 
        merchandise that is informally entered or released at any 
        centralized hub facility or express consignment carrier 
        facility during the normal operating hours of the Customs 
        Service, subject to reimbursement and payment under 
        subparagraph (A).''.
    (c) Citation.--Section 13031(b)(9)(B)(ii) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(9)(B)(ii)) 
is amended by striking ``section 236 of the Tariff and Trade Act of 
1984'' and inserting ``section 236 of the Trade and Tariff Act of 
1984''.

SEC. 12007. SPECIAL RULE FOR EXTENDING TIME FOR FILING DRAWBACK CLAIMS.

    Section 313(r) of the Tariff Act of 1930 (19 U.S.C. 1313(r)) is 
amended by adding at the end the following:
            ``(3)(A)(i) Subject to clause (ii), the Customs Service 
        may, notwithstanding the limitation set forth in paragraph (1), 
        extend the time for filing a drawback claim for a period not to 
        exceed 18 months, if--
                    ``(I) the claimant establishes to the satisfaction 
                of the Customs Service that the claimant was unable to 
                file the drawback claim because of an event declared by 
                the President to be a major disaster on or after 
                January 1, 1994; and
                    ``(II) the claimant files a request for such 
                extension with the Customs Service within one year from 
                the last day of the 3-year period referred to in 
                paragraph (1).
            ``(ii) In the case of a major disaster occurring on or 
        after January 1, 1994, and before the date of the enactment of 
        this paragraph--
                    ``(I) the Customs Service may extend the time for 
                filing the drawback claim for a period not to exceed 1 
                year; and
                    ``(II) the request under clause (i)(II) must be 
                filed not later than 1 year from the date of the 
                enactment of this paragraph.
            ``(B) If an extension is granted with respect to a request 
        filed under this paragraph, the periods of time for retaining 
        records set forth in subsection (t) of this section and section 
        508(c)(3) shall be extended for an additional 18 months or, in 
        a case to which subparagraph (A)(ii) applies, for a period not 
        to exceed 1 year from the date the claim is filed.
            ``(C) For purposes of this paragraph, the term `major 
        disaster' has the meaning given that term in section 102(2) of 
        the Robert T. Stafford Disaster Relief and Emergency Assistance 
        Act (42 U.S.C. 5122(2)).''.

SEC. 12008. TREATMENT OF CERTAIN ENTRIES.

    (a) Liquidation or Reliquidation of Entries.--Notwithstanding 
sections 514 and 520 of the Tariff Act of 1930 (19 U.S.C. 1514 and 
1520), and any other provision of law, the United States Customs 
Service shall liquidate or reliquidate those entry numbers made at New 
York, New York, which are listed in subsection (c), in accordance with 
the final results of the administrative review, covering the period 
from May 1, 1984, through March 31, 1985, undertaken by the 
International Trade Administration of the Department of Commerce for 
such entries (case number A-580-008).
    (b) Payment of Amounts Owed.--Any amounts owed by the United States 
pursuant to the liquidation or reliquidation of an entry under 
subsection (a) shall be paid by the Customs Service within 90 days 
after such liquidation or reliquidation.
    (c) Entry List.--The entries referred to in subsection (a) are the 
following:

                                                                        
                       Entry Number               Date of Entry         
                                                                        
                   84-4426808..........  August 29, 1984                
                   84-4427823..........  September 4, 1984              
                   84-4077985..........  July 25, 1984                  
                   84-4080859..........  August 3, 1984                 
                   84-4080817..........  August 3, 1984                 
                   84-4077723..........  August 1, 1984                 
                   84-4075194..........  July 10, 1984                  
                   84-4076481..........  July 17, 1984                  
                   84-4080930..........  August 9, 1984.                
                                                                        


SEC. 12009. TEMPORARY DUTY SUSPENSION FOR PERSONAL EFFECTS OF 
                    PARTICIPANTS IN CERTAIN WORLD ATHLETIC EVENTS.

    (a) In General.--Subchapter II of chapter 99 of the Harmonized 
Tariff Schedule of the United States is amended by inserting in 
numerical sequence the following new heading:

``                9902.98.05         Any of the following                                                                                               
                                      articles not                                                                                                      
                                      intended for sale                                                                                                 
                                      or distribution to                                                                                                
                                      the public:                                                                                                       
                                      personal effects of                                                                                               
                                      aliens who are                                                                                                    
                                      participants in,                                                                                                  
                                      officials of, or                                                                                                  
                                      accredited members                                                                                                
                                      of delegations to,                                                                                                
                                      the 1998 Goodwill                                                                                                 
                                      Games, and of                                                                                                     
                                      persons who are                                                                                                   
                                      immediate family                                                                                                  
                                      members of or                                                                                                     
                                      servants to any of                                                                                                
                                      the foregoing                                                                                                     
                                      persons; equipment                                                                                                
                                      and materials                                                                                                     
                                      imported in                                                                                                       
                                      connection with the                                                                                               
                                      foregoing event by                                                                                                
                                      or on behalf of the                                                                                               
                                      foregoing persons                                                                                                 
                                      or the organizing                                                                                                 
                                      committee of such                                                                                                 
                                      event; articles to                                                                                                
                                      be used in                                                                                                        
                                      exhibitions                                                                                                       
                                      depicting the                                                                                                     
                                      culture of a                                                                                                      
                                      country                                                                                                           
                                      participating in                                                                                                  
                                      such event; and, if                                                                                               
                                      consistent with the                                                                                               
                                      foregoing, such                                                                                                   
                                      other articles as                                                                                                 
                                      the Secretary of                                                                                                  
                                      the Treasury may                                                                                                  
                                      allow..............  Free              No change          Free              On or before 2/1/99            ''.    

      
    (b) Taxes and Fees Not To Apply.--The articles described in heading 
9902.98.05 of the Harmonized Tariff Schedule of the United States (as 
added by subsection (a)) shall be free of taxes and fees which may be 
otherwise applicable.
    (c) Effective Date.--The amendment made by this section applies to 
articles entered, or withdrawn from warehouse for consumption, on or 
after the 15th day after the date of the enactment of this Act.

SEC. 12010. MISCELLANEOUS TECHNICAL CORRECTIONS.

    (a) Drawback and Refunds.--Section 313(s)(2)(B) of the Tariff Act 
of 1930 (19 U.S.C. 1313(s)(2)(B)) is amended by striking ``successor'' 
the first place it appears and inserting ``predecessor''.
    (b) Trade Act of 1974.--Section 301(c)(4) of the Trade Act of 1974 
(19 U.S.C. 2411(c)(4)) is amended by striking ``(1)(C)(iii)'' and 
inserting ``(1)(D)(iii)''.

SEC. 12011. URUGUAY ROUND AGREEMENTS ACT.

    Section 405(b) of the Uruguay Round Agreements Act (19 U.S.C. 
3602(b)) is amended--
            (1) in paragraph (1) by striking ``1(a)'' and inserting 
        ``1(b)''; and
            (2) in paragraph (2) by striking ``1(b)'' and inserting 
        ``1(a)''.

SEC. 12012. FILING OF CERTIFICATIONS FOR CIVIL AIRCRAFT PARTS.

    General Note 6 of the Harmonized Tariff Schedule of the United 
States is amended--
            (1) by inserting ``or electronic'' after ``shall file a 
        written''; and
            (2) by striking ``with the appropriate customs officer'' 
        and inserting ``with the United States Customs Service''.

SEC. 12013. EXEMPTION REGARDING CERTAIN VESSEL REPAIRS.

    (a) Temporary Exemption Extended.--Section 484E(b)(2)(B) of the 
Customs and Trade Act of 1990 (19 U.S.C. 1466 note) is amended by 
striking ``December 31, 1992'' and inserting ``December 31, 1994''.
    (b) Effective Date.--The amendment made by this section applies to 
any entry made after December 31, 1992, and before January 1, 1995.

SEC. 12014. FEES FOR CERTAIN CUSTOMS SERVICES.

    (a) In General.--Section 13031(a)(5) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985 (19 U.S.C. 58c(a)(5)) is amended--
            (1) in subparagraph (A), by inserting ``a place'' after 
        ``aircraft from''; and
            (2) in subparagraph (B), by striking ``subsection 
        (b)(1)(A)'' and inserting ``subsection (b)(1)(A)(i)''.
    (b) Limitation on Fees.--Section 13031(b)(1) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(b)(1)) is 
amended to read as follows:
    ``(b) Limitations on Fees.--(1)(A) No fee may be charged under 
subsection (a) of this section for customs services provided in 
connection with--
            ``(i) the arrival of any passenger whose journey--
                    ``(I) originated in--
                            ``(aa) Canada,
                            ``(bb) Mexico,
                            ``(cc) a territory or possession of the 
                        United States, or
                            ``(dd) any adjacent island (within the 
                        meaning of section 101(b)(5) of the Immigration 
                        and Nationality Act (8 U.S.C. 1101(b)(5))), or
                    ``(II) originated in the United States and was 
                limited to--
                            ``(aa) Canada,
                            ``(bb) Mexico,
                            ``(cc) territories and possessions of the 
                        United States, and
                            ``(dd) such adjacent islands;
            ``(ii) the arrival of any railroad car the journey of which 
        originates and terminates in the same country, but only if no 
        passengers board or disembark from the train and no cargo is 
        loaded or unloaded from such car while the car is within any 
        country other than the country in which such car originates and 
        terminates;
            ``(iii) the arrival of any ferry; or
            ``(iv) the arrival of any passenger on board a commercial 
        vessel traveling only between ports which are within the 
        customs territory of the United States.
    ``(B) The exemption provided for in subparagraph (A) shall not 
apply in the case of the arrival of any passenger on board a commercial 
vessel whose journey originates and terminates at the same place in the 
United States if there are no intervening stops.
    ``(C) The exemption provided for in subparagraph (A)(i) shall not 
apply to fiscal years 1994, 1995, 1996, and 1997.''.
    (c) Fee Assessed Only Once.--Section 13031(b)(4) of the 
Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 
58c(b)(4)) is amended--
            (1) by redesignating subparagraphs (A) and (B) as clauses 
        (i) and (ii), respectively;
            (2) by striking ``No fee'' and inserting ``(A) No fee''; 
        and
            (3) by adding at the end the following new subparagraph:
    ``(B) In the case of a commercial vessel making a single voyage 
involving 2 or more United States ports with respect to which the 
passengers would otherwise be charged a fee pursuant to subsection 
(a)(5), such fee shall be charged only 1 time for each passenger.''.
    (d) Effective Date.--The amendments made by this section shall take 
effect as if included in the amendments made by section 521 of the 
North American Free Trade Agreement Implementation Act.

SEC. 12015. TECHNICAL CORRECTION TO CERTAIN CHEMICAL DESCRIPTION.

    (a) Amendment to Subheading 2933.90.02.--The article description 
for subheading 2933.90.02 of the Harmonized Tariff Schedule of the 
United States is amended by striking ``(Quizalofop ethyl)''.
    (b) Effective Date.--
            (1) General rule.--The amendment made by this section 
        applies to articles entered, or withdrawn from warehouse for 
        consumption, on or after the 15th day after the date of the 
        enactment of this Act.
            (2) Retroactive provision.--Notwithstanding section 514 of 
        the Tariff Act of 1930 or any other provision of law, upon 
        proper request (which includes sufficient information to 
        identify and locate the entry) filed with the Customs Service 
        on or before the date that is 180 days after the date of the 
        enactment of this Act, any entry, or withdrawal from warehouse 
        for consumption, of an article that occurred--
                    (A) after December 31, 1994, and before the date 
                that is 15 days after the date of the enactment of this 
                Act, and
                    (B) with respect to which there would have been no 
                duty or a lesser duty if the amendment made by 
                subsection (a) applied to such entry or withdrawal,
        shall be liquidated or reliquidated as though such amendment 
        applied to such entry or withdrawal.

SEC. 12016. MARKING OF IMPORTED ARTICLES AND CONTAINERS.

  (a) In General.--Section 304 of the Tariff Act of 1930 (19 
U.S.C.1304) is amended--
            (1) by redesignating subsections (f), (g), (h), and (i) as 
        subsections (i), (j), (k), and (l), respectively, and
            (2) by inserting after subsection (e) the following new 
        subsections:
    ``(f) Marking of Metal Forgings.--The marking requirements of 
subsections (a) and (b) shall not apply to--
            ``(1) metal forgings that--
                    ``(A) are imported for processing into finished 
                hand tools in the United States, and
                    ``(B) have not been improved in condition beyond 
                rough burring, trimming, grinding, turning, hammering, 
                chiseling, or filing; and
            ``(2) hand tools made from metal forgings described in 
        paragraph (1).
    ``(g) Marking of Certain Coffee and Tea Products.--The marking 
requirements of subsections (a) and (b) shall not apply to articles 
described in subheading 0901.21, 0901.22, 0902.10, 0902.20, 0902.30, 
0902.40, 2101.10, or 2101.20 of the Harmonized Tariff Schedule of the 
United States, as in effect on January 1, 1995.
    ``(h) Marking of Spices.--The marking requirements of subsections 
(a) and (b) shall not apply to articles provided for under subheadings 
0904.11, 0904.12, 0904.20, 0905.00, 0906.10, 0906.20, 0907.00, 0908.10, 
0908.20, 0908.30, 0909.10, 0909.20, 0909.30, 0909.40, 0909.50, 0910.10, 
0910.20, 0910.30, 0910.40, 0910.50, 0910.91, 0910.99, 1106.20, 1207.40, 
1207.50, 1207.91, 1404.90, and 3302.10, and items classifiable in 
categories 0712.90.60, 0712.90.8080, 1209.91.2000, 1211.90.2000, 
1211.90.8040, 1211.90.8050, 1211.90.8090, 2006.00.3000, 2918.13.2000, 
3203.00.8000, 3301.90.1010, 3301.90.1020, and 3301.90.1050 of the 
Harmonized Tariff Schedule of the United States, as in effect on 
January 1, 1995.''.
    (b) Effective Date.--The amendments made by this section apply to 
goods entered, or withdrawn from warehouse for consumption, on or after 
the date of the enactment of this Act.

SEC. 12017. RELIQUIDATING ENTRY OF WARP KNITTING MACHINES.

    Notwithstanding section 514 of the Tariff Act of 1930 (19 U.S.C. 
1514) or any other provision of law, upon proper request filed with the 
Customs Service before the 180th day after the date of the enactment of 
this Act, the Secretary of the Treasury shall--
            (1) liquidate or reliquidate as duty free Entry No. 100-
        3022436-3, made on July 12, 1989, at the port of Charleston, 
        South Carolina; and
            (2) refund any duties and interest paid with respect to 
        such entry.

SEC. 12018. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

    Section 310(a)(1) of the Trade Act of 1974 (19 U.S.C. 2420(a)(1)) 
is amended by striking ``calendar year 1995'' and inserting ``each of 
calendar years 1995 through 2000''.

             Subtitle B--Generalized System of Preferences

SEC. 12101. SHORT TITLE.

    This subtitle may be cited as the ``GSP Renewal Act of 1995''.

SEC. 12102. GENERALIZED SYSTEM OF PREFERENCES.

    (a) In General.--Title V of the Trade Act of 1974 is amended to 
read as follows:

              ``TITLE V--GENERALIZED SYSTEM OF PREFERENCES

``SEC. 501. AUTHORITY TO EXTEND PREFERENCES.

    ``The President may provide duty-free treatment for any eligible 
article from any beneficiary developing country in accordance with the 
provisions of this title. In taking any such action, the President 
shall have due regard for--
            ``(1) the effect such action will have on furthering the 
        economic development of developing countries through the 
        expansion of their exports;
            ``(2) the extent to which other major developed countries 
        are undertaking a comparable effort to assist developing 
        countries by granting generalized preferences with respect to 
        imports of products of such countries;
            ``(3) the anticipated impact of such action on United 
        States producers of like or directly competitive products; and
            ``(4) the extent of the beneficiary developing country's 
        competitiveness with respect to eligible articles.

``SEC. 502. DESIGNATION OF BENEFICIARY DEVELOPING COUNTRIES.

    ``(a) Authority To Designate Countries.--
            ``(1) Beneficiary developing countries.--The President is 
        authorized to designate countries as beneficiary developing 
        countries for purposes of this title.
            ``(2) Least-developed beneficiary developing countries.--
        The President is authorized to designate any beneficiary 
        developing country as a least-developed beneficiary developing 
        country for purposes of this title, based on the considerations 
        in section 501 and subsection (c) of this section.
    ``(b) Countries Ineligible for Country Designation.--
            ``(1) Specific countries.--The following countries may not 
        be designated as beneficiary developing countries for purposes 
        of this title:
                    ``(A) Australia.
                    ``(B) Canada.
                    ``(C) European Union member states.
                    ``(D) Iceland.
                    ``(E) Japan.
                    ``(F) Monaco.
                    ``(G) New Zealand.
                    ``(H) Norway.
                    ``(I) Switzerland.
            ``(2) Other bases for ineligibility.--The President shall 
        not designate any country a beneficiary developing country 
        under this title if any of the following applies:
                    ``(A) Such country is a Communist country, unless--
                            ``(i) the products of such country receive 
                        nondiscriminatory treatment,
                            ``(ii) such country is a WTO Member (as 
                        such term is defined in section 2 of the 
                        Uruguay Round Agreements Act,) and a member of 
                        the International Monetary Fund, and
                            ``(iii) such country is not dominated or 
                        controlled by international communism.
                    ``(B) Such country is a party to an arrangement of 
                countries and participates in any action pursuant to 
                such arrangement, the effect of which is--
                            ``(i) to withhold supplies of vital 
                        commodity resources from international trade or 
                        to raise the price of such commodities to an 
                        unreasonable level, and
                            ``(ii) to cause serious disruption of the 
                        world economy.
                    ``(C) Such country affords preferential treatment 
                to the products of a developed country, other than the 
                United States, which has, or is likely to have, a 
                significant adverse effect on United States commerce.
                    ``(D)(i) Such country--
                            ``(I) has nationalized, expropriated, or 
                        otherwise seized ownership or control of 
                        property, including patents, trademarks, or 
                        copyrights, owned by a United States citizen or 
                        by a corporation, partnership, or association 
                        which is 50 percent or more beneficially owned 
                        by United States citizens,
                            ``(II) has taken steps to repudiate or 
                        nullify an existing contract or agreement with 
                        a United States citizen or a corporation, 
                        partnership, or association which is 50 percent 
                        or more beneficially owned by United States 
                        citizens, the effect of which is to 
                        nationalize, expropriate, or otherwise seize 
                        ownership or control of property, including 
                        patents, trademarks, or copyrights, so owned, 
                        or
                            ``(III) has imposed or enforced taxes or 
                        other exactions, restrictive maintenanceor 
operational conditions, or other measures with respect to property, 
including patents, trademarks, or copyrights, so owned, the effect of 
which is to nationalize, expropriate, or otherwise seize ownership or 
control of such property,
                unless clause (ii) applies.
                    ``(ii) This clause applies if the President 
                determines that--
                            ``(I) prompt, adequate, and effective 
                        compensation has been or is being made to the 
                        citizen, corporation, partnership, or 
                        association referred to in clause (i),
                            ``(II) good faith negotiations to provide 
                        prompt, adequate, and effective compensation 
                        under the applicable provisions of 
                        international law are in progress, or the 
                        country described in clause (i) is otherwise 
                        taking steps to discharge its obligations under 
                        international law with respect to such citizen, 
                        corporation, partnership, or association, or
                            ``(III) a dispute involving such citizen, 
                        corporation, partnership, or association over 
                        compensation for such a seizure has been 
                        submitted to arbitration under the provisions 
                        of the Convention for the Settlement of 
                        Investment Disputes, or in another mutually 
                        agreed upon forum,
                and the President promptly furnishes a copy of such 
                determination to the Senate and House of 
                Representatives.
                    ``(E) Such country fails to act in good faith in 
                recognizing as binding or in enforcing arbitral awards 
                in favor of United States citizens or a corporation, 
                partnership, or association which is 50 percent or more 
                beneficially owned by United States citizens, which 
                have been made by arbitrators appointed for each case 
                or by permanent arbitral bodies to which the parties 
                involved have submitted their dispute.
                    ``(F) Such country aids or abets, by granting 
                sanctuary from prosecution to, any individual or group 
                which has committed an act of international terrorism.
                    ``(G) Such country has not taken or is not taking 
                steps to afford internationally recognized worker 
                rights to workers in the country (including any 
                designated zone in that country).
        Subparagraphs (D), (E), (F), and (G) shall not prevent the 
        designation of any country as a beneficiary developing country 
        under this title if the President determines that such 
        designation will be in the national economic interest of the 
        United States and reports such determination to the Congress 
        with the reasons therefor.
    ``(c) Factors Affecting Country Designation.--In determining 
whether to designate any country as a beneficiary developing country 
under this title, the President shall take into account--
            ``(1) an expression by such country of its desire to be so 
        designated;
            ``(2) the level of economic development of such country, 
        including its per capita gross national product, the living 
        standards of its inhabitants, and any other economic factors 
        which the President deems appropriate;
            ``(3) the extent to which other major developed countries 
        are extending generalized preferential tariff treatment to such 
        country;
            ``(4) the extent to which such country has assured the 
        United States that it will provide equitable and reasonable 
        access to the markets and basic commodity resources of such 
        country and the extent to which such country has assured the 
        United States that it will refrain from engaging in 
        unreasonable export practices;
            ``(5) whether such country is providing adequate and 
        effective protection of intellectual property rights;
            ``(6) the extent to which such country has taken action 
        to--
                    ``(A) reduce trade distorting investment practices 
                and policies (including export performance 
                requirements); and
                    ``(B) reduce or eliminate barriers to trade in 
                services;
            ``(7) whether or not such country has taken or is taking 
        steps to afford to workers in that country (including any 
        designated zone in that country) internationally recognized 
        worker rights; and
            ``(8) the extent to which such country fails to cooperate 
        with the United States in preventing the proliferation of 
        nuclear weapons, nuclear weapons components, and nuclear 
        weapons delivery systems, or in preventing illegal drug 
        trafficking.
A country may be found to not provide adequate and effective protection 
of intellectual property rights under paragraph (5) and section 
503(d)(2)(B), notwithstanding the fact that it may be in compliance 
with the specific obligations of the Agreement on Trade-Related Aspects 
of Intellectual Property Rights referred to in section 101(d)(15) of 
the Uruguay Round Agreements Act.
    ``(d) Withdrawal, Suspension, or Limitation of Country 
Designation.--
            ``(1) In general.--The President may withdraw, suspend, or 
        limit the application of the duty-free treatment accorded under 
        this title with respect to any country. Except in exceptional 
        circumstances, the President, before taking any action under 
        this subsection, shall provide a period for the submission of 
        public comments on the matter under consideration, and in 
        taking any action under this subsection, the President shall 
        consider the factors set forth in section 501 and subsection 
        (c) of this section, and comments received from the public.
            ``(2) Changed circumstances.--The President shall, after 
        complying with the requirements of subsection (f)(2), withdraw 
        or suspend the designation of any country as a beneficiary 
        developing country if, after such designation, the President 
        determines that as the result of changed circumstances such 
        country would be barred from designation as a beneficiary 
        developing country under subsection (b)(2). Such country shall 
        cease to be a beneficiary developing country on the day on 
        which the President issues an Executive order or Presidential 
        proclamation revoking the designation of such country under 
        this title.
    ``(e) Mandatory Graduation of Beneficiary Developing Countries.--If 
the President determines that a beneficiary developing country has 
become a `high income' country, as defined by the official statistics 
of the International Bank for Reconstruction and Development, then the 
President shall terminate the designation of such country as a 
beneficiary developing country for purposes of this title, effective on 
January 1 of the second year following the year in which such 
determination is made.
    ``(f) Congressional Notification.--
            ``(1) Notification of designation.--
                    ``(A) In general.--Before the President designates 
                any country as a beneficiary developing country under 
                this title, the President shall notify the Congress of 
                the President's intention to make such designation, 
                together with the considerations entering into such 
                decision.
                    ``(B) Designation as least-developed beneficiary 
                developing country.--At least 60 days before the 
                President designates any country as a least-developed 
                beneficiary developing country, the President shall 
                notify the Congress of the President's intention to 
                make such designation.
            ``(2) Notification of termination.--If the President has 
        designated any country as a beneficiary developing country 
        under this title, the President shall not terminate such 
        designation unless, at least 60 days before such termination, 
        the President has notified the Congress and has notified such 
        country of the President's intention to terminate such 
        designation, together with the considerations entering into 
        such decision.

``SEC. 503. DESIGNATION OF ELIGIBLE ARTICLES.

    ``(a) Eligible Articles.--
            ``(1) Designation.--
                    ``(A) In general.--Except as provided in subsection 
                (b), the President is authorized to designate articles 
                as eligible articles for all beneficiary developing 
                countries for purposes of this title by Executive order 
                or Presidential proclamation after receiving the advice 
                of the International Trade Commission in accordance 
                with subsection (e).
                    ``(B) Least-developed beneficiary developing 
                countries.--Except as provided in subsection (b), the 
                President is authorized to designate additional 
                articles as eligible articles only for countries 
                designated as least-developed beneficiary developing 
                countries under section 502(a)(2) if, after receiving 
                the advice of the International Trade Commission in 
                accordance with subsection (e) of this section, the 
                President determines that such articles are not import-
                sensitive in the context of imports from least-
                developed beneficiary developing countries.
                    ``(C) Three-year rule.--If, after receiving the 
                advice of the International Trade Commission under 
                subsection (e), an article has been formally considered 
                for designation as an eligible article under this title 
                and denied such designation, such article may not be 
                reconsidered for such designation for a period of three 
                years after such denial.
            ``(2) Rule of origin.--
                    ``(A) General rule.--The duty-free treatment 
                provided under this title shall apply to any eligible 
                article which is the growth, product, or manufacture of 
                a beneficiary developing country if--
                            ``(i) that article is imported directly 
                        from a beneficiary developing country into the 
                        customs territory of the United States; and
                            ``(ii) the sum of--
                                    ``(I) the cost or value of the 
                                materials produced in the beneficiary 
                                developing country or any two or more 
                                countries which are members of the same 
                                association of countries which is 
                                treated as one country under section 
                                506(2), plus
                                    ``(II) the direct costs of 
                                processing operations performed in such 
                                beneficiary developing country or such 
                                member countries,
                        is not less than 35 percent of the appraised 
                        value of such article at the time it is 
                        entered.
                    ``(B) Exclusions.--An article shall not be treated 
                as the growth, product, or manufacture of a beneficiary 
                developing country by virtue of having merely 
                undergone--
                            ``(i) simple combining or packaging 
                        operations, or
                            ``(ii) mere dilution with water or mere 
                        dilution with another substance that does not 
                        materially alter the characteristics of the 
                        article.
            ``(3) Regulations.--The Secretary of the Treasury, after 
        consulting with the United States Trade Representative, shall 
        prescribe such regulations as may be necessary to carry out 
        paragraph (2), including, but not limited to, regulations 
        providing that, in order to be eligible for duty-free treatment 
        under this title, an article--
                    ``(A) must be wholly the growth, product, or 
                manufacture of a beneficiary developing country, or
                    ``(B) must be a new or different article of 
                commerce which has been grown, produced, or 
                manufactured in the beneficiary developing country.
    ``(b) Articles That May Not Be Designated As Eligible Articles.--
            ``(1) Import sensitive articles.--The President may not 
        designate any article as an eligible article under subsection 
        (a) if such article is within one of the following categories 
        of import-sensitive articles:
                    ``(A) Textile and apparel articles which were not 
                eligible articles for purposes of this title on January 
                1, 1994, as this title was in effect on such date.
                    ``(B) Import-sensitive electronic articles.
                    ``(C) Import-sensitive steel articles.
                    ``(D) Footwear, handbags, luggage, flat goods, work 
                gloves, and leather wearing apparel which were not 
                eligible articles for purposes of this title on January 
                1, 1995, as this title was in effect on such date.
                    ``(E) Import-sensitive semimanufactured and 
                manufactured glass products.
                    ``(F) Any other articles which the President 
                determines to be import-sensitive in the context of the 
                Generalized System of Preferences.
            ``(2) Articles against which other actions taken.--An 
        article shall not be an eligible article for purposes of this 
        title for any period during which such article is the subject 
        of any action proclaimed pursuant to section 203 of this Act 
        (19 U.S.C. 2253) or section 232 or 351 of the Trade Expansion 
        Act of 1962 (19 U.S.C. 1862, 1981).
            ``(3) Agricultural products.--No quantity of an 
        agricultural product subject to a tariff-rate quota that 
        exceeds the in-quota quantity shall be eligible for duty-free 
        treatment under this title.
    ``(c) Withdrawal, Suspension, or Limitation of Duty-Free Treatment; 
Competitive Need Limitation.--
            ``(1) In general.--The President may withdraw, suspend, or 
        limit the application of the duty-free treatment accorded under 
        this title with respect to any article, except that no rate of 
        duty may be established with respect to any article pursuant to 
        this subsection other than the rate which would apply but for 
        this title. In taking any action under this subsection, the 
        President shall consider the factors set forth in sections 501 
        and 502(c).
            ``(2) Competitive need limitation.--
                    ``(A) Basis for withdrawal of duty-free 
                treatment.--Except as provided in this paragraph and 
                subject to subsection (d), whenever the President 
                determines that a beneficiary developing country has 
                exported (directly or indirectly) to the United States 
                during any calendar year beginning after December 31, 
                1995--
                            ``(i) a quantity of an eligible article 
                        having an appraised value in excess of 
                        $75,000,000, except that, in applying this 
                        clause, the amount of $75,000,000 shall be 
                        increased by $5,000,000 on January 1 of each 
                        calendar year after calendar year 1995, or
                            ``(ii) a quantity of an eligible article 
                        equal to or exceeding 50 percent of the 
                        appraised value of the total imports of that 
                        article into the United States during the 
                        calendar year,
                then the President shall, not later than July 1 of the 
                next calendar year, terminate the duty-free treatment 
                for that article from that beneficiary developing 
                country.
                    ``(B) Country defined.--For purposes of this 
                paragraph, the term `country' does not include an 
                association of countries which is treated as one 
                country under section 506(2), but does include a 
                country which is a member of any such association.
                    ``(C) Redesignations.--A country which is no longer 
                treated as a beneficiary developing country with 
                respect to an eligible article by reason of 
                subparagraph (A) may be redesignated a beneficiary 
                developing country with respect to such article, 
                subject to the considerations set forth in sections 501 
                and 502, if imports of such article from such country 
                did not exceed the limitations in subparagraph (A) 
                during the preceding calendar year.
                    ``(D) Least-developed beneficiary developing 
                countries.--Subparagraph (A) shall not apply to any 
                least-developed beneficiary developing country.
                    ``(E) Articles not produced in the united states 
                excluded.--Subparagraph (A)(ii) shall not apply with 
                respect to any eligible article if a like or directly 
                competitive article was not produced in the United 
                States on January 1, 1995.
                    ``(F) De minimis waivers.--The President may 
                disregard subparagraph (A)(ii) with respect to any 
                eligible article from any beneficiary developing 
                country if the appraised value of the total imports of 
                such article into the United States during calendar 
                year 1995 or any calendar year thereafter does not 
                exceed $13,000,000, except that, in applying this 
                subparagraph, the amount of $13,000,000 shall be 
                increased by $500,000 on January 1 of each calendar 
                year after calendar year 1995.
    ``(d) Waiver of Competitive Need Limitation.--
            ``(1) In general.--The President may waive the application 
        of subsection (c)(2) with respect to any eligible article of 
        any beneficiary developing country if, before July 1 of the 
        calendar year beginning after the calendar year for which a 
        determination described in subsection (c)(2)(A) was made with 
        respect to such eligible article, the President--
                    ``(A) receives the advice of the International 
                Trade Commission under section 332 of the Tariff Act of 
                1930 on whether any industry in the United States is 
                likely to be adversely affected by such waiver,
                    ``(B) determines, based on the considerations 
                described in sections 501 and 502(c) and the advice 
                described in subparagraph (A), that such waiver is in 
                the national economic interest of the United States, 
                and
                    ``(C) publishes the determination described in 
                subparagraph (B) in the Federal Register.
            ``(2) Considerations by the president.--In making any 
        determination under paragraph (1), the President shall give 
        great weight to--
                    ``(A) the extent to which the beneficiary 
                developing country has assured the United States that 
                such country will provide equitable and reasonable 
                access to the markets and basic commodity resources of 
                such country, and
                    ``(B) the extent to which such country provides 
                adequate and effective protection of intellectual 
                property rights.
            ``(3) Effective period of waiver.--Any waiver granted under 
        this subsection shall remain in effect until the President 
        determines that such waiver is no longer warranted due to 
        changed circumstances.
    ``(e) International Trade Commission Advice.--Before designating 
articles as eligible articles under section 503(a)(1), the President 
shall publish and furnish the International Trade Commission with lists 
of articles which may be considered for designation as eligible 
articles for purposes of this title. The provisions of sections 131, 
132, 133, and 134 shall be complied with as though action under section 
501 and this section were action under section 123 to carry out a trade 
agreement entered into under section 123.
    ``(f) Special Rule Concerning Puerto Rico.--No action under this 
title may affect any tariff duty imposed by the Legislature of Puerto 
Rico pursuant to section 319 of the Tariff Act of 1930 on coffee 
imported into Puerto Rico.

``SEC. 504. REVIEW AND REPORTS TO CONGRESS.

    ``(a) Report on Operation of Title.--On or before July 31, 1997, 
the President shall submit to the Congress a full and complete report 
regarding the operation of this title.
    ``(b) Annual Reports on Worker Rights.--The President shall submit 
an annual report to the Congress on the status of internationally 
recognized worker rights within each beneficiary developing country.

``SEC. 505. DATE OF TERMINATION.

    ``No duty-free treatment provided under this title shall remain in 
effect after December 31, 1997.

``SEC. 506. DEFINITIONS.

    ``For purposes of this title:
            ``(1) Beneficiary developing country.--The term 
        `beneficiary developing country' means any country with respect 
        to which there is in effect an Executive order or Presidential 
        proclamation by the President designating such country as a 
        beneficiary developing country for purposes of this title.
            ``(2) Country.--The term `country' means any foreign 
        country or territory, including any overseas dependent 
        territory or possession of a foreign country, or the Trust 
        Territory of the Pacific Islands. In the case of an association 
        of countries which is a free trade area or customs union, or 
        which is contributing to comprehensive regional economic 
        integration among its members through appropriate means, 
        including, but not limited to, the reduction of duties, the 
        President may by Executive order or Presidential proclamation 
        provide that all members of such association other than members 
        which are barred from designation under section 502(b) shall be 
        treated as one country for purposes of this title.
            ``(3) Entered.--The term `entered' means entered, or 
        withdrawn from warehouse for consumption, in the customs 
        territory of the United States.
            ``(4) Internationally recognized worker rights.--The term 
        `internationally recognized worker rights' includes--
                    ``(A) the right of association;
                    ``(B) the right to organize and bargain 
                collectively;
                    ``(C) a prohibition on the use of any form of 
                forced or compulsory labor;
                    ``(D) a minimum age for the employment of children; 
                and
                    ``(E) acceptable conditions of work with respect to 
                minimum wages, hours of work, and occupational safety 
                and health.
            ``(5) Least-developed beneficiary developing country.--The 
        term `least-developed beneficiary developing country' means a 
        beneficiary developing country that is designated as a least-
        developed beneficiary developing country under section 
        502(a)(2).''.
    (b) Table of Contents.--The items relating to title V in the table 
of contents of the Trade Act of 1974 are amended to read as follows:

              ``TITLE V--GENERALIZED SYSTEM OF PREFERENCES

``Sec. 501. Authority to extend preferences.
``Sec. 502. Designation of beneficiary developing countries.
``Sec. 503. Designation of eligible articles.
``Sec. 504. Review and reports to Congress.
``Sec. 505. Date of termination.
``Sec. 506. Definitions.''.

SEC. 12103. RETROACTIVE APPLICATION FOR CERTAIN LIQUIDATIONS AND 
                    RELIQUIDATIONS.

    (a) In General.--Notwithstanding section 514 of the Tariff Act of 
1930 or any other provision of law and subject to subsection (b), the 
entry--
            (1) of any article to which duty-free treatment under title 
        V of the Trade Act of 1974 would have applied if the entry had 
        been made on July 31, 1995, and
            (2) that was made after July 31, 1995, and before the date 
        of the enactment of this Act,
shall be liquidated or reliquidated as free of duty, and the Secretary 
of the Treasury shall refund any duty paid with respect to such entry. 
As used in this subsection, the term ``entry'' includes a withdrawal 
from warehouse for consumption.
    (b) Requests.--Liquidation or reliquidation may be made under 
subsection (a) with respect to an entry only if a request therefor is 
filed with the Customs Service, within 180 days after the date of the 
enactment of this Act, that contains sufficient information to enable 
the Customs Service--
            (1) to locate the entry; or
            (2) to reconstruct the entry if it cannot be located.
            (c) Treatment of Certain Entries of Buffalo Leather.--
        Notwithstanding section 514 of the Tariff Act of 1930 or any 
        other provision of law, buffalo leather, provided for under 
        subheading 4104.39.20 of the Harmonized Tariff Schedule of the 
        United States, that is a product of Thailand and entered into 
        the United States under entry numbers M42-1113868-8 and M42-
        1113939-7, shall be liquidated or reliquidated, as appropriate, 
        as if entered on June 30, 1995.

SEC. 12104. CONFORMING AMENDMENTS.

    (a) Trade Laws.--
            (1) Section 1211(b) of the Omnibus Trade and 
        Competitiveness Act of 1988 (19 U.S.C. 3011(b)) is amended--
                    (A) in paragraph (1), by striking ``(19 U.S.C. 
                2463(a), 2464(c)(3))'' and inserting ``(as in effect on 
                the day before the date of the enactment of the GSP 
                Renewal Act of 1995)''; and
                    (B) in paragraph (2), by striking ``(19 U.S.C. 
                2464(c)(1))'' and inserting the following: ``(as in 
                effect on the day before the date of the enactment of 
                the GSP Renewal Act of 1995)''.
            (2) Section 203(c)(7) of the Andean Trade Preference Act 
        (19 U.S.C. 3202(c)(7)) is amended by striking ``502(a)(4)'' and 
        inserting ``506(4)''.
            (3) Section 212(b)(7) of the Caribbean Basin Economic 
        Recovery Act (19 U.S.C. 2702(b)(7)) is amended by striking 
        ``502(a)(4)'' and inserting ``506(4)''.
            (4) General note 3(a)(iv)(C) of the Harmonized Tariff 
        Schedule of the United States is amended by striking ``sections 
        503(b) and 504(c)'' and inserting ``subsections (a), (c), and 
        (d) of section 503''.
    (b) Other Laws.--
            (1) Section 871(f)(2)(B) of the Internal Revenue Code of 
        1986 is amended by striking ``within the meaning of section 
        502'' and inserting ``under title V''.
            (2) Section 2202(8) of the Export Enhancement Act of 1988 
        (15 U.S.C. 4711(8)) is amended by striking ``502(a)(4)'' and 
        inserting ``506(4)''.
            (3) Section 231A(a) of the Foreign Assistance Act of 1961 
        (22 U.S.C. 2191a(a)) is amended--
                    (A) in paragraph (1) by striking ``502(a)(4) of the 
                Trade Act of 1974 (19 U.S.C. 2462(a)(4))'' and 
                inserting ``506(4) of the Trade Act of 1974'';
                    (B) in paragraph (2) by striking ``505(c) of the 
                Trade Act of 1974 (19 U.S.C. 2465(c))'' and inserting 
                ``504(b) of the Trade Act of 1974''; and
                    (C) in paragraph (4) by striking ``502(a)(4)'' and 
                inserting ``506(4)''.

                Subtitle C--Trade Adjustment Assistance

SEC. 12201. MODIFICATION OF TRADE ADJUSTMENT ASSISTANCE.

    (a) Requirement of Training.--(1) Section 231(c) of the Trade Act 
of 1974 (19 U.S.C. 2291) is amended--
            (A) in paragraph (1)(A) and (B) by striking ``it is not 
        feasible or appropriate to approve a training program'' and 
        inserting ``a training program is not available''; and
            (B) in paragraph (2)(A) and (B) by striking ``it is 
        feasible or appropriate to approve a training program'' and 
        inserting ``a training program is available''.
    (2) Section 233(b) of such Act (19 U.S.C. 2293(b)) is repealed.
    (3) Paragraph (3) of section 250(d) of the Trade Act of 1974 (19 
U.S.C. 2331(d)) is amended--
            (A) by striking ``it is not feasible or appropriate to 
        approve a training program'' in subparagraph (A) and inserting 
        ``a training program is not available'', and
            (B) by striking ``notwithstanding the provisions of section 
        233(b),'' in subparagraph (B).
    (b) Termination of Relocation Allowances.--(1) Section 238 of the 
Trade Act of 1974 (19 U.S.C. 2298), and the item relating to that 
section in the table of contents for that Act, are repealed.
    (2) Section 250(d) of the Trade Act of 1974 (19 U.S.C. 2331(d)) is 
amended by striking paragraph (5).
    (c) Termination of Program.--Section 285(c) of the Trade Act of 
1974 (19 U.S.C. 2271 preceding note) is amended--
            (1) in paragraph (1), by striking ``1998'' and inserting 
        ``2000''; and
            (2) by amending paragraph (2) to read as follows:
    ``(2) No assistance, vouchers, allowances, or other payments may be 
provided under subchapter D of chapter 2 after September 30, 1998.''.
    (d) Extension of Authorization.--(1) Section 245(a) of the Trade 
Act of 1974 (19 U.S.C. 2317(a)) is amended by striking ``and 1998'' and 
inserting ``1998, 1999, and 2000''.
    (2) Section 256(b) of the Trade Act of 1974 (19 U.S.C. 2346(a)) is 
amended by striking ``and 1998'' and inserting ``1998, 1999, and 
2000''.
    (e) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall take effect on the date 
        of the enactment of this Act.
            (2) Subsections (a) and (b).--The amendments made by 
        subsections (a) and (b) shall take effect on October 1, 1996.
                              INTRODUCTION

    Advocates of balancing the Federal budget typically cite 
the range of economic reasons supporting their case. These 
economic issues are extremely important; but they should not 
overshadow a fundamental political point: Balancing the budget 
is as critical to the functions of government as is balancing 
powers among the legislative, executive, and judicial branches. 
It is a necessary principle for governing properly. That is the 
foremost reason why the Seven-Year Balanced Budget 
Reconciliation Act of 1995 must become law.

        The Political Imperative of Balancing the Federal Budget

    The importance of this principle traces back to the 
Founders, as in Jefferson's admonition that the government 
should be prohibited from borrowing money and running up public 
debt. Less often noted--though just as important--is Hamilton's 
declaration in Federalist 30: Money is, with propriety, 
considered as the vital principle of the body politic; as that 
which sustains its life and motion and enables it to perform 
its most essential functions. Thus Hamilton placed public 
finance firmly in the realm of basic political questions--of 
conditions of governing.
    For most of the Nation's history, the Federal Government 
sought to balance spending and revenues as a matter of course. 
This behavior was not tied to any particular statute or written 
constitutional provision. It was part of what Nobel Laureate 
James M. Buchanan has termed ``our effective constitution,'' 
and amounted to a moral imperative: ``Up until recent decades, 
the principle that government should balance its budget in 
peacetime was, indeed, a part of our effective constitution, 
even if not formally written down. Before the Keynesian 
inspired shift in thinking about fiscal matters, it was 
universally considered immoral to spend without taxing, except 
in periods of emergency--wars or major depressions. We have 
lost the moral sense of fiscal responsibility that served to 
make formal constitutional constraints unnecessary.'' \1\ The 
value of this quasi-constitutional practice reached beyond its 
budgetary and economic implications. As the late Professor 
Aaron Wildavsky has described it, the practice carried with it 
a sense of balance in political relationships: The doctrine of 
the balanced budget--a doctrine that became so powerful over 
time that terrible things were supposed to happen should its 
boundaries be violated--was far more than an economic theory. 
It meant--and, to many people, still means--that things are all 
right. The ``balance'' referred to was not only between revenue 
and expenditure but also between social orders. If the 
competing cultures that make up American life are in balance, 
meaning that they still accept the legitimacy of their uneasy 
alliance, all is indeed well in the new world.\2\
    \1\ Prepared statement to the House Committee on the Budget, 
concerning a proposed balanced budget amendment, April 27, 1992.)
    \2\ ``The New Politics of the Budgetary Process,'' 1988.
---------------------------------------------------------------------------
    As long ago as 1967, Professor Buchanan was warning that 
chronic budget deficits threatened the ability of citizens and 
their elected representatives to make decisions about their 
government's priorities. He wrote: How is it possible for the 
individual to answer the question: How much public goods should 
I purchase?, if, because of uncertainty concerning the 
relationship between the two sides of the budget account, the 
real price to the individual of these public goods is 
continuously and unpredictably changing? \3\ In other words, 
how can taxpayers judge how much government they want if the 
cost of government is unrelated to its size? Chronic deficits 
obscure the relationship. Furthermore, to the extent that 
government exceeds the size and scope that citizens will ratify 
with their tax dollars, that portion of the government is 
illegitimate.
    \3\ ``Public Finance in Democratic Process,'' 1967.
---------------------------------------------------------------------------
    Yet since the early 1970's, when fiscal policy was reformed 
by the Congressional Budget and Impoundment Control Act, 
deficit spending has become entrenched, despite politicians' 
repeated pledges to balance the books. Taxpayers' growing 
frustration with this failure undoubtedly played a major role 
in the revolutionary election of 1994, in which voters swept 
away 40 years of Democrat control in the House of 
Representatives and installed a Republican House Majority 
committed to balancing the budget.

                     The President's Belated Reply

    For a while, President Clinton seemed to ignore the 
message. His initial budget submission for fiscal year 1996 
maintained continued deficit spending of $200 billion a year 
for as far as the eye could see. In a flourish of economic 
sophistry and political relativism, administration officials 
claimed the President's deficits nevertheless were shrinking as 
a percentage of gross domestic product--as if that made them 
alright.
    Even Bill Clinton couldn't stick with that argument for 
long. So in midyear, he released a new fiscal plan that he 
claimed would balance the budget in 10 years--a more reasonable 
course, he contended, than the Republicans' radical 7-year 
strategy.
    Except that the ``new'' Clinton plan isn't new at all and 
doesn't balance the budget. An analysis by the Congressional 
Budget Office showed the Clinton deficits were still $200 
billion a year a more, and were not declining. It is noteworthy 
that Clinton, in his first State of the Union address, had 
endorsed the use of CBO numbers as the standard for measuring 
budget proposals: ``Let's at least argue about the same set of 
numbers so the American people will think we're shooting 
straight with them,'' he said. Yet to support his cynical new 
``balanced'' budget claim, Clinton turned to his own Office of 
Management and Budget to furnish the economic projections on 
which his plan was based. Administration officials insisted 
that OMB's figures differed only slightly from CBO's. But this 
ignores the fact that even slight differences in economic 
projections lead to hundreds of billions of dollars of 
difference in government spending demands.
    Besides, focusing on these allegedly minor differences 
misses the point. It's not a question of whether OMB or CBO is 
more accurate in its projections. The point was that as long as 
the President refused to use the same set of numbers, it was 
impossible to compare his plan with that of Congress. Hence, 
the President's 10-year budget collapses like the straw man 
that it is.
    The only real balanced budget plan in Washington is this 
one.

                          The Economic Reasons

    Although the political reasons for balancing the budget are 
preeminent, the economic issues are not far behind. The problem 
of current deficit spending is fast becoming a crisis. 
Consider: The current Federal debt is approximately $4.9 
trillion. Interest on the debt is $235 billion. If the growth 
of government spending is not curtailed, the debt will reach 
$7.533 trillion by 2005, with interest payments of $412 
billion. Over the next 15 years--if current patterns are 
allowed to continue--accumulated interest payments will total 
$5.2 trillion. As early as 1997, Americans will pay as much 
interest on the debt each year--$270 billion--as they pay for 
national defense.
    Even now, Americans are paying for this debt in another 
way: in the form of interest rates that are about 2 percentage 
points higher than they would be if the budget were balanced. 
This adds as much as $37,000 over 30 years to the mortgage on a 
$75,000 home.
    A balanced budget likely will lower current interest rates 
by about 2 percentage points. This, in turn, will boost 
economic activity, leading to the following concrete benefits:
          It will lead to the creation of 4.25 million more 
        jobs over the next 10 years.
          It will increase per capita incomes 16.1 percent.
          It will generate $235 billion more revenue for the 
        Federal Government without a tax increase.
          It will generate $232 billion more revenue for State 
        and local governments without a tax increase.
    To reach balance, this budget achieves $1.157 trillion in 
deficit reduction over 7 years. By the time the task is 
complete, in 2002, total Federal spending will be $1.814 
trillion, compared with about $1.5 trillion today. Thus, 
Federal spending will continue to grow, but at a slower rate 
than under current policies.

                            Keeping Promises

    But the determined pursuit of a balanced budget is much 
more than a numbers game. It is a catalyst for reevaluating the 
government down to its core. Getting government back to living 
within its means requires fundamental, systemic reform--the 
kind of reform Republicans promised in 1994. The reconciliation 
bill that reaches the House floor will be a reflection of 
promises kept, including the following:
    Tax relief. The legislation calls for $245 billion in tax 
reductions over 7 years, including a per-child tax credit for 
American families and a reduction in the capital gains rate to 
promote economic growth and job creation.
    Reforming welfare. No one questions that the current 
welfare system needs reform. The system is harmful to the very 
people it is supposed to help. It shackles them to a life of 
dependency rather than pushing them toward self-sufficiency. It 
also shackles taxpayers. Here are some of the facts of this 
failure:
          Welfare spending now exceeds $305 billion a year and 
        has totalled $5 trillion since 1965--more than the cost 
        of winning World War II.
          This $305 billion is about three times the amount 
        needed to raise all poor Americans above the poverty 
        line.
          Since 1970, the number of children in poverty has 
        increased 40 percent.
          Since 1965, the juvenile arrest rate for violent 
        crimes has tripled.
          Since 1960, the number of unmarried pregnant teens 
        has nearly doubled and teen suicide has more than 
        tripled.
    The House welfare reform plan (H.R. 4, the Personal 
Responsibility Act of 1995), which passed the House on March 24 
and is to be incorporated in this reconciliation act, maintains 
a safety net that will not entangle its beneficiaries. It 
renews the basic values of American civilization, emphasizing 
work, family, and opportunity, and it reestablishes property 
ownership and full citizenship for the poor. In short, it 
replaces caretaking with caring.
    Preserving, protecting, and strengthening Medicare. This 
plan will incorporate the House-passed Medicare reform, which 
will offer more choices to senior citizens and significantly 
shore up the trust fund that finances Medicare. Neither the 
President nor the Congressional minority has a legitimate 
alternative.
    Transforming Medicaid. This plan holds Medicaid spending 
growth to a sustainable rate and shifts the operation of this 
program where it belongs to State governments. It is consistent 
with proposals by the Nation's Republican governors.
    Keeping the promise of protecting Social Security. This 
budget makes no changes whatsoever in Social Security benefits.
    Calling for real cuts in discretionary spending from the 
fiscal year 1995 level. The discretionary spending cuts in this 
bill truly are cuts in the way normal Americans would 
understand--they reduce spending approximately $150 billion 
over 7 years from current levels, not from some inflated, 
bureaucratic estimate of projected spending.
    Reforming veterans programs, student loans, agriculture, 
Federal retirement, and publicly assisted housing. The task of 
balancing the budget is a shared project, including the efforts 
of these constituencies.
    Eliminating unfair, market-distorting Federal subsidies. 
Many of the Nation's largest corporations receive Federal 
grants for work the companies would pursue on their own. In 
other cases, these funds only promote a cumbersome, backward-
looking industrial policy. This reconciliation bill begins to 
address these outrages.

                        A Word About the Process

    During markup, the Budget Committee minority complained 
that the reconciliation bill before it was incomplete, because 
major components were yet to be added. The complaint is not 
surprising; those who have no program tend to argue over 
process. But closer examination shows this process is entirely 
consistent with statute and House rules.
    As explained by the Budget Committee chairman, this act 
will be written in three stages:

                                STAGE I

    Reported reconciliation recommendations. In this stage, the 
Budget Committee, on October 12, 1995, assembled and reported 
legislative recommendations made to it by the various 
authorizing committees pursuant to their reconciliation 
directives in the conference report on House Concurrent 
Resolution 67. It is important to note that, as provided under 
the 1974 Budget Act, the Budget Committee could not 
substantively alter the recommendations made to it. The Budget 
Committee's role was principally ministerial: to package those 
recommendations and send them on to the Committee on Rules.

                                STAGE II

    Budget enforcement procedures. Under House rules adopted 
this year, the House Committee on the Budget has jurisdiction 
over the discretionary spending caps and the pay-as-you-go 
[PAYGO] mechanism. In a separate action on October 12, the 
Budget Committee reported an extension of these enforcement 
measures, which is to be incorporated into a substitute that 
will be made in order by the Committee on Rules as the base 
text for reconciliation.

                               STAGE III

    The amendment in the nature of a substitute. Two 
authorities provide for the Budget Committee chairman to offer 
such an amendment to be entertained by the Committee on Rules. 
The 1974 Budget Act states:

          The Committee on Rules in the House of 
        Representatives may make in order amendments to achieve 
        changes specified by reconciliation directives 
        contained in a concurrent resolution on the budget if a 
        committee or committees of the House fail to submit 
        recommended changes to its Committee on the Budget 
        pursuant to its instruction.

    In addition, the conference report on House Concurrent 
Resolution 67 establishes a procedure under which the chairman 
of the House Committee on the Budget is to certify whether the 
reconciliation bill brought to the floor achieves a balanced 
budget over 7 years.
    Under these authorities, the chairman will offer an 
amendment in the nature of a substitute, which also will be 
introduced as a freestanding bill. This amendment will 
incorporate, along with the recommendations already reported: 
First, relevant additional components that have been, or will 
have been, acted on separately by the House--for example, 
Medicare, welfare reform, the Contract with America tax cuts; 
and second, additional measures needed to bring all committees 
into compliance with their reconciliation directives and to 
assure that the reconciliation bill achieves a balanced budget 
in 7 years.
    It is important to note that the two largest components to 
be added in the substitute--welfare reform and the Medicare 
plan--have been or will have been voted on separately by the 
House before Members take up reconciliation. Furthermore, the 
process of amending reconciliation recommendations reported by 
the Budget Committee is entirely consistent with the provisions 
of the Budget Act.

                               Conclusion

    As noted above, this reconciliation bill represents a 
crucial political act--the act of keeping promises made in the 
1994 election. The bill balances the budget over 7 years; it 
reforms welfare; it preserves, protects, and strengthens 
Medicare; and it provides needed tax relief to American 
families. This historic act calls for nothing less than a 
restoration of the American dream--the romantic vision in which 
families improve their lives through responsibility and hard 
work; in which the sturdiest safety net is fashioned by 
communities of neighbors helping neighbors; in which the 
government operates within its means; and in which every 
problem is a challenge and an opportunity.
    Finally, this act restores hope in the future. It must 
become law because America's future is not the property of this 
Congress, or this administration, or any political party. The 
future belongs to the American people themselves.
         TITLE II--COMMITTEE ON BANKING AND FINANCIAL SERVICES

                              House of Representatives,    
               Committee on Banking and Financial Services,
                                Washington, DC, September 28, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Chairman Kasich: On September 19, 1995, the Committee 
on Banking and Financial Services, approved reconciliation 
recommendations for programs within the jurisdiction of the 
Banking Committee pursuant to the reconciliation directives 
contained in the conference report on House Concurrent 
Resolution 67 by a vote of 26 to 20. The enclosed material is 
the legislative language and narrative requirements reflective 
of the adopted views of the Banking Committee.
    The budget resolution instructs the Committee on Banking 
and Financial Services to report changes in law within its 
jurisdiction that provide direct spending levels of $13.087 
billion in fiscal year 1996, $50.061 billion for fiscal year 
1996 through fiscal year 2000, and $65.112 billion for fiscal 
year 1996 through fiscal year 2002.
    The legislative recommendations forwarded by the Banking 
Committee meet these budget resolution instructions. The 
committee urges the incorporation of these recommendations into 
the budget reconciliation act with one caveat.
    Since the reporting of these recommendations, the committee 
has learned from the Congressional Budget Office [CBO] that 
section 2203(c)(31) as presently drafted may not have the 
budgetary effect that the committee had expected. This 
paragraph modifies the Federal Home Loan Bank System's payment 
to the Resolution Funding Corporation by changing the system's 
contribution from a flat $300 million payment to 22.63 percent 
of the system's earnings. At the time of the committee markup, 
the understanding was that this amendment was revenue neutral. 
According to a more recent scoring by the CBO, it is not. 
Therefore, it is requested that this paragraph be amended by 
replacing ``22.63'' with a figure to be determined by the CBO 
which will make this provision revenue neutral.
    On behalf of the members of the Banking Committee, I want 
to express appreciation to you and your committee for the 
assistance you have given the Banking Committee and hope these 
recommendations will be of assistance to your committee in 
meeting the budget reconciliation targets.
            Sincerely,
                                            James A. Leach,
                                                          Chairman.

                           table of contents

                                                                   Page
Transmittal letter...............................................   191
Purpose and summary..............................................   192
Background and need for legislation..............................   192
Hearings.........................................................   197
Section-by-section analysis......................................   198
Committee consideration and votes................................   206
Congressional Budget Office estimate.............................   211
Committee oversight..............................................   220
Committee on Government Reform and Oversight findings............   220

                          Purpose and Summary

    To comply with the instructions of the conference agreement 
on the budget resolution (H. Con. Res. 67), which instructs the 
Committee on Banking and Financial Services to report changes 
in law within its jurisdiction that provide direct spending 
levels of $13.087 billion in fiscal year 1996, $50.061 billion 
for fiscal year 1996 through fiscal year 2000, and $65.112 
billion for fiscal year 1996 through fiscal year 2002, the 
committee makes the following legislative recommendations:
          (1) Terminate the RTC and FDIC Affordable Housing 
        Programs;
          (2) Eliminate the FHA Assignment Program and 
        Foreclosure Relief Program;
          (3) Reform the HUD-owned Multifamily Property 
        Disposition Program;
          (4) Recapture rural housing loan subsidies by the 
        Rural Housing and Community Development Service 
        [RHCDS];
          (5) Reduce section 8 annual adjustment factors for 
        units without tenant turnover;
          (6) Enact a comprehensive solution to the long-term 
        viability problem of the deposit insurance system; and,
          (7) Reform the CRA-Community Reinvestment Act.

                  Background and Need for Legislation

                     SUBTITLE A--HOUSING PROVISIONS

Sec. 2101. Termination of RTC and FDIC Affordable Housing Programs

    The committee recommends the termination of the affordable 
housing marketing restrictions on the remaining Resolution 
Trust Corporation [RTC] and the Federal Deposit Insurance 
Corporation [FDIC] affordable housing inventories and the 
termination of the Unified Affordable Housing Program of the 
RTC and FDIC. These recommendations will achieve a savings of 
$10 million in fiscal year 1996, $31 million in fiscal years 
1996 to 2000, and $32 million in fiscal years 1996 to 2002.
    The RTC Affordable Housing Program was created in 1989 in 
title V, subtitle A of the Financial Institutions Reform, 
Recovery, and Enforcement Act of 1989 [FIRREA], which added a 
new section 21A to the Federal Home Loan Bank Act. Upon the 
creation of the RTC, FIRREA mandated that the RTC offer for 
sale certain types of properties to eligible households, 
nonprofit groups, or public housing authorities for both single 
and multifamily housing, during a period of not less than 90 
days after first becoming available.
    The committee received a GAO report during the 103d 
Congress that concluded that the ``RTC has achieved mixed 
results in its AHDP [Affordable Housing Disposition Program].'' 
According to the September 1994 audit, RTC had then sold 
approximately 63 percent of the single-family properties and 54 
percent of the multifamily properties through its disposition 
program. The report indicated that RTC lacked controls to 
verify that purchasers were eligible to acquire property 
through the single-family program or were complying with the 
program's 1-year occupancy requirement. Multifamily projects 
also lacked sufficient enforcement controls to ensure 
compliance with set-aside requirements.
    Although RTC made some improvement in its performance in 
the single-family area, significant concerns persist for the 
multifamily program where:
          (i) complete information to assess occupancy status 
        was not available;
          (ii) timeframes to encourage multifamily owner 
        compliance were not established;
          (iii) enforcement actions were insufficient; and
          (iv) protection of land use restriction agreements 
        [LURA] were inadequate.
    Opponents of this recommendation argue that termination of 
the RTC Program is moot, given current statutory requirements 
to transfer affordable housing functions to the FDIC on October 
1, 1995, as well as the RTC's expiration at the end of the 1995 
calendar year. The committee, however, recommends termination 
of both programs since the results achieved have been mixed at 
best.
    This provision assumes that HUD will not incur any 
additional costs to carry out the remaining functions of the 
affordable housing program because the RTC committed funds for 
ongoing monitoring and sales at the time it closed each 
insolvent institution. The basis of its estimates of losses 
includes the estimate of net sales proceeds from all assets 
associated with each insolvent institution, including the 
subsidy costs of the Affordable Housing Program. Therefore, the 
committee intends for any obligated amounts associated with 
ongoing costs of the Affordable Housing Program to transfer 
from RTC to HUD and spend out over time.
    This provision will preserve the obligations of purchasers 
to abide by the rent limitation, low-income occupancy and other 
requirements of these affordable housing programs with respect 
to properties that were sold prior to enactment or sold after 
enactment under the authority granted to complete transactions 
in progress or arising out of a letter of intent to purchase. 
Consequently, the Secretary of the Department of Housing and 
Urban Development will carry out the remaining authority and 
responsibilities of the FDIC, including monitoring program 
compliance. The committee further recommends that HUD, as part 
of its wind up authority, continue to retain and employ the 
services of the private sector contractors currently working 
with the RTC and the FDIC under the Standard Asset Management 
Disposition Agreements [SAMDA].

Sec. 2102. Elimination of FHA Assignment Program and foreclosure relief

    The committee recommends termination of the FHA assignment 
and temporary mortgage assistance programs, which achieves a 
savings of $850 million in fiscal year 1996, $1.363 billion in 
fiscal years 1996 to 2000, and $1.680 billion in fiscal years 
1996 to 2002.
    The FHA assignment program was created in 1959 but not 
operational until 1976 after a court consent decree required 
HUD to implement the program. Subsequently, modifications to 
the temporary mortgage assistance program and the assignment 
program required HUD to accept defaulted FHA borrowers into the 
program provided that their default was based on circumstances 
beyond their control, such as sickness or loss of employment, 
and that there was a reasonable expectation that the borrower 
could resume normal and regular mortgage payments and correct 
any loan deficiencies within a reasonable time. Currently, the 
program allows up to 36 months for forbearance workout. Since 
the majority of assigned loans are insured under the FHA mutual 
mortgage insurance fund, the cost of the assignment program is 
financed by the fund, which also insures private lenders 
against losses on mortgages of one to four housing units.
    The committee notes that the well-intentioned objectives of 
the assignment program are far surpassed by the potential for 
fraud and abuse of the program that has now led to potentially 
$1.5 billion in losses to the FHA mutual mortgage insurance 
fund [MMIF]. Thus, current FHA borrowers are paying higher 
premiums to meet the capital ratio standards of the MMIF as 
well as cover the exorbitant costs of the assignment program.
    A draft GAO study indicates that there are currently 71,500 
loans in the program and that the program ``operates at a high 
cost to FHA's fund and has not been very successful helping 
borrowers avoid foreclosures in the longrun.'' Approximately 30 
percent of assigned borrowers eventually become current and 
graduate out of the FHA assignment program, thereby indicating 
a failure rate of approximately 70 percent.
    Furthermore, the report cites fundamental operating flaws 
that contribute to the borrower's failure to successfully 
graduate from the assignment program: substantial delinquencies 
prior to assignment and a 36-month time period that permits 
delinquencies to grow, even if borrowers are current with 
repayment agreements. Notwithstanding the 36-month forbearance, 
GAO discovered that 45 percent of borrowers (31,900) had been 
in the program longer than 3 years and approximately 1,000 
borrowers have been in assignment for over 15 years. The 
committee notes, however, that termination of the program does 
not preclude the Secretary from working with lenders in an 
attempt to provide flexible but perhaps shorter-term 
forbearance agreements.

Sec. 2103. Reform of HUD-owned Multifamily Property Disposition Program

    The committee recommends reforming this program by 
authorizing HUD to sell HUD-owned multifamily housing projects 
and HUD-held mortgages without restriction. To expedite this 
process, HUD may delegate its authority to other parties in 
order to dispose of the properties more expeditiously and 
thereby avoid expensive holding costs. This recommendation 
achieves a savings of $140 million in fiscal year 1996, $140 
million in fiscal years 1996-2000, and $140 million in fiscal 
years 1996-2002.
    In making this recommendation, the committee notes that in 
April 1994, Congress enacted the Multifamily Property 
Disposition Reform Act of 1994 which made major reforms to 
section 203 of the Housing and Community Development Amendments 
of 1978. These reforms removed many burdensome restrictions 
that prevented HUD from finding owners who were interested in 
managing these properties effectively.
    Notwithstanding earlier attempts to provide disposition 
reform, the provisions retained in the act are cumbersome. For 
example, prior to disposition, the Secretary was required to 
develop a disposition plan describing minimum terms and 
conditions for sale and a market analysis of the area. 
Additionally, the legislation limited the price the Secretary 
could ask for the project. Finally, the Secretary was required 
to solicit input from residents as well as the community. While 
laudable if contained in a preservation program, these 
provisions effectively hampered the Secretary's ability to make 
rational business decisions.
    In addition to pre-disposition plans, the Secretary was 
required to provide additional project-based assistance or 
implement rent restrictions on certain properties. 
Unfortunately, budget constraints make it impossible to 
continue assisting buildings through project-based assistance. 
Additionally, it is unpalatable to provide Federal dollars to 
properties which are in terrible condition.
    The potential dislocation of low-income families should be 
minimal since HUD has the authority to provide rental 
assistance vouchers to any person displaced by the sale of 
these properties.

Sec. 2104. Recapture of rural housing loan subsidies by Rural Housing 
        and Community Development Service

    The committee recommends requiring the Rural Housing and 
Community Development Service [RHCDS], under the Department of 
Agriculture, to recapture subsidy payments on single family 
loans authorized under section 502 of the Housing Act of 1949. 
Recapture provisions were included because taxpayers paid a 
portion of the mortgage, and therefore, were entitled in part 
to a portion of the property's appreciation. This 
recommendation makes recapture of interest credit assistance 
due upon the repayment of any loan made under this title or 
upon the disposition or nonoccupancy of the property of the 
borrower. The recapture provision achieves a savings of $39 
million in fiscal year 1996, $39 million in fiscal years 1996-
2000, and $39 in fiscal years 1996-2002.
    The amount recaptured by the RHCDS is based on a complex 
formula that primarily accounts for the subsidy provided and 
the property's appreciation. The recapture amount due can never 
exceed the amount of subsidy received by the borrower or 78 
percent of the value of the property's appreciation. Thus, 
borrowers who owe large recapture balances at the time of loan 
payoff are borrowers who have received large subsidies and have 
experienced significant appreciation in the value of their 
homes--they are the program success stories.
    The recapture provision requires costly and labor-intensive 
administrative oversight. At the time of refinance or when the 
loan is paid off, the borrower may pay or defer payment of the 
recaptured subsidy. If payment is deferred, the Government must 
subordinate its lien position and establish a noninterest 
bearing receivable account. Currently, there are approximately 
10,750 receivable accounts covering approximately $5.2 billion 
in subsidy provided on loans either refinanced or repaid that 
could be recaptured in the future.

Sec. 2105. Reduction of section 8 annual adjustment factors for units 
        without tenant turnover

    Currently, owners of section 8 properties receive annual 
subsidy increases, called annual adjustment factors [AAF's], to 
account for inflation and costs associated with routine 
maintenance after an apartment is vacated. The committee 
recommends decreasing the AAF for units in which there is no 
tenant turnover during the year. This provision eliminates the 
payment of excess subsidies to perform unnecessary maintenance. 
This recommendation achieves a savings of $908 million in 
fiscal years 1996 to 2000 and $1.272 billion in fiscal years 
1996 to 2002. CBO scored this provision as achieving savings of 
$42 million in fiscal year 1996, $950 million in fiscal years 
1996 to 2000, and $1.314 billion in fiscal years 1996 to 2002. 
However, because the VA/HUD appropriations bill includes this 
policy change for fiscal year 1996, the Budget Committee does 
not assume the initial $42 million savings for fiscal year 
1996. This $42 million savings is therefore also deducted from 
our cumulative 5- and 7-year totals.

                 subtitle b--thrift charter conversion

    Subtitle B provides for the recapitalization of the savings 
association insurance fund [SAIF] which insures the deposits of 
savings associations and is administered by the Federal Deposit 
Insurance Corporation. The administration has expressed concern 
about the long-term viability of the SAIF and the ability of 
SAIF members to pay for the $800 million in interest on 
obligations issued by the Financing Corporation. Chapter 1 of 
the subtitle incorporates the administration's proposal to 
address these deposit insurance concerns.
    Under chapter 1, the FDIC is given the authority to assess 
a one-time fee on deposits insured by the SAIF in order to 
bring the fund up to the statutorily required reserve ratio of 
1.25 percent--$1.25 for each $100 of insured deposits. The SAIF 
and the bank insurance fund [BIF] are merged on January 1, 
1998. Before the funds are merged, however, the subtitle 
requires that future SAIF assessments be no less than 
assessments imposed on deposits insured by BIF. Any excess 
revenue from SAIF assessments would be placed in a special 
reserve which could not be counted for purposes of determining 
if the new merged fund is at the required reserve ratio. The 
budgetary effect of these provisions is a net decrease in 
direct spending levels of $900 million over 7 years. Finally, 
the chapter imposes the FICO obligation on all FDIC-insured 
deposits on January 1, 1996.
    As a necessary followup to the merger of the deposit 
insurance funds and sharing of the FICO obligation, chapter 2 
of the subtitle repeals the Home Owners' Loan Act which 
provides for the chartering of Federal savings associations and 
regulation of savings and loan holding companies. The Office of 
Thrift Supervision is also abolished under the chapter. State 
chartered thrifts are to be treated as if they were commercial 
banks for purposes of all Federal banking laws, including the 
Federal Deposit Insurance Act and the Bank Holding Company Act.

        subtitle c--community reinvestment act [cra] amendments

    Subtitle C results in revenue savings by returning the 
Community Reinvestment Act to its original purpose of 
encouraging financial institutions to reinvest in their 
communities, while not imposing comprehensive credit allocation 
dictates or unnecessary burdens on banks and savings 
associations. The budgetary effect of this proposal is a $22 
million change--increase--in revenue over the 7-year period. 
These savings are largely accomplished through the adoption of 
an exemption for small institutions with assets of less than 
$100 million from the requirements of CRA and a self-
certification procedure for institutions with no more than $250 
million in assets. These revisions to the CRA will reduce the 
amount of agency staff time and personnel that must be devoted 
to examining compliance with the CRA. Additional savings are 
achieved from another revision of CRA which moves the 
opportunity for community comments from the time a financial 
institution files an application to the time when the 
institution is examined for compliance with CRA. This results 
in cost savings because it reduces the number of times that an 
institution's compliance with CRA must be reviewed and 
considered.

                                Hearings

    On March 8, 1995, the Financial Institutions and Consumer 
Credit Subcommittee held an open hearing on CRA reform and 
related issues: The Honorable Joseph P. Kennedy II, House of 
Representatives; the Honorable Ricki Helfer, Chairman, Federal 
Deposit Insurance Corporation; the Honorable Eugene A. Ludwig, 
Comptroller of the Currency; the Honorable Jonathan L. 
Fiechter, Acting Director, Office of Thrift Supervision; the 
Honorable Lawrence Lindsey, Governor, Federal Reserve System; 
Mr. William A. Niskanen, chairman, the Cato Institute; Ms. Lucy 
H. Griffin, Compliance Management Services; Ms. Cathy Bessant, 
senior vice president, Nations Bank; Mr. Warren Traiger, CRA 
practitioner; Mr. Ned Brown, Financial Modeling Concepts.
    On March 9, 1995, the Financial Institutions and Consumer 
Credit Subcommittee held an open hearing on CRA reform and 
related issues: Mr. James Culberson, Jr., chairman, First 
National Bank and Trust Co.; Mr. Tony Abbate, chairman, 
marketing committee, Independent Bankers Association; Mr. Mark 
Milligan, America's Community Bankers; Mr. Benson F. Roberts, 
vice president for policy, Local Initiatives Support 
Corporation; Ms. Michelle Meier, counsel, government affairs, 
Consumers Union; Ms. Gale Cincotta, chairperson, National 
People's Action; Mr. John E. Taylor, president and CEO, 
National Community Reinvestment Coalition; Mr. Allen Fishbein, 
general counsel, Center for Community Change; Rev. Charles R. 
Stith, national president, Organization for a New Equality.
    On March 23, 1995, the Financial Institutions and Consumer 
Credit Subcommittee held an open hearing on BIF-SAIF reform and 
related issues: The Honorable Richard Carnell, Assistant 
Secretary of Financial Institutions, Department of Treasury; 
the Honorable Ricki Helfer, Chairman, Federal Deposit Insurance 
Corporation; the Honorable Jonathan L. Fiechter, Acting 
Director, Office of Thrift Supervision; Mr. Robert L. Gramling, 
Director, Corporate Financial Audits Accounting and Information 
Management Division, General Accounting Office; Mr. Nicolas P. 
Retsinas, Federal Housing Finance Board; Mr. Howard McMillan, 
Jr., American Bankers Association; Mr. Richard L. Mount, 
president, Independent Bankers Association of America; Mr. 
David Carson, America's Community Bankers; Mr. Gregory L. 
Pulles, vice chairman, Association of Financial Services 
Holding Companies; Mr. James Montgomery, chairman and CEO, 
Great Western Bank.
    On March 24, 1995, the Financial Institutions and Consumer 
Credit Subcommittee held an open hearing on BIF-SAIF reform and 
related issues: Mr. Michael T. Crowley, Jr., president and CEO, 
Mutual Savings Bank; Mr. Joe C. Morris, chairman, Savings 
Association Insurance Fund, industry advisory committee, 
Metropolitan Financial Corp.; Mr. Peter Bell, executive vice 
president for corporate community relations, TCF Financial 
Corp.; Mr. Thomas M. O'Brien, Community Bankers Association of 
New York State; Mr. Ed Molnar, president, Harleysville National 
Bank; Mr. Bert Ely, National Taxpayers Union; Dr. Kenneth H. 
Thomas, lecturer in finance, Wharton School, University of 
Pennsylvania; Mr. Samuel L. Foggie, president, National Bankers 
Association; Mr. Gerard Joab, Local Initiatives Support Corp.
    On August 2, 1995, the Financial Institutions and Consumer 
Credit Subcommittee held an open hearing on BIF-SAIF reform and 
related issues: The Honorable Alan Greenspan, Chairman, Federal 
Reserve Board; the Honorable Ricki Helfer, Chairman, Federal 
Deposit Insurance Corp.; the Honorable John D. Hawke, Under 
Secretary, Domestic Finance, Department of Treasury; the 
Honorable Eugene A. Ludwig, Comptroller of the Currency; the 
Honorable Jonathan L. Fiechter, Acting Director, Office of 
Thrift Supervision, Mr. James Culberson, Jr., American Bankers 
Association; Mr. William Sones, vice president, Independent 
Bankers Association of America; Mr. James Montgomery, chairman 
and CEO, Great Western Bank; Mr. Jack Schaffer, chairman, 
American Council of State Savings Supervisors.

                      Section-by-Section Analysis

                     SUBTITLE A--HOUSING PROVISIONS

Sec. 2101. Termination of RTC and FDIC affordable housing programs

    This section repeals the unified Resolution Trust 
Corporation [RTC]/Federal Deposit Insurance Corporation [FDIC] 
Affordable Housing Program and transfers windup authority for 
the RTC/FDIC affordable housing programs to the Department of 
Housing and Urban Development [HUD]. This section also 
terminates the FDIC Affordable Housing Advisory Board and the 
FDIC Affordable Housing Program (section 40 of the Federal 
Deposit Insurance Act). Remaining functions and authority in 
the RTC Affordable Housing Program are transferred to the 
Secretary of HUD. This includes recapturing excess proceeds 
from the resale of properties and the monitoring and 
enforcement of low-income occupancy requirements and rent 
limitations.

Sec. 2102. Elimination of FHA Assignment Program and foreclosure relief

    This section eliminates section 230 of the National Housing 
Act and prohibits HUD from accepting, by assignment, FHA single 
family properties into its FHA portfolio for management, 
servicing, and forbearance workouts.

Sec. 2103. Reform of HUD-owned Multifamily Property Program

    This provision authorizes HUD to sell multifamily housing 
projects that are HUD-owned or have HUD-held mortgages without 
restrictions. HUD is given authority to delegate this authority 
to other parties in order to sell the property more quickly.

Sec. 2104. Recapture of rural housing loan subsidies by Rural Housing 
        and Community Development Service

    This section provides statutory authority to require the 
RHCDS to recapture government subsidy payments at the time the 
borrower refinances or pays off a single family direct loan 
mortgage. Currently, the RHCDS can only recapture the subsidy 
at the time the property is disposed or if the unit is not 
occupied.

Sec. 2105. Reduction of section 8 annual adjustment factors for units 
        without tenant turnover

    This section makes permanent a FY 1995 appropriation 
provision that reduces the Annual Adjustment Factor [AAF] by 
one percentage point for those Section 8 units in which there 
has been no tenant turnover since the preceding annual rental 
adjustment.

                 SUBTITLE B--THRIFT CHARTER CONVERSION

 Chapter 1--Bank Insurance Fund and Savings Association Insurance Fund

Sec. 2200. Short title

Sec. 2201. Special assessment

    Section 2201 requires the FDIC to impose a special 
assessment due on January 1, 1996, on the deposits insured by 
the savings association insurance fund [SAIF] to bring the SAIF 
up to the designated reserve ratio of 1.25 percent. The FDIC is 
given the authority to exempt institutions from the special 
assessment if the exemption would reduce risk to the SAIF. Such 
institutions would be required to continue to pay the 
semiannual assessment rate applicable on June 30, 1995 for the 
period 1996-99.
    It is the intention of the subsection to provide that, in 
connection with the special premium assessment, the FDIC may 
set a reduced assessment rate for deposits acquired and held by 
Oakar banks which have purchased SAIF deposits and commingled 
them with institutions deposits insured by the bank insurance 
fund [BIF]. In its consideration of whether or not to provide a 
different assessment rate for deposits held by Oakar banks the 
FDIC is to consider two factors:
          (i) the extent to which the deposit base treated as 
        SAIF deposits does not reflect actual deposit base; and
          (ii) the ability of an individual Oakar bank to 
        demonstrate its actual deposits notwithstanding the 
        growth attribution rules.
If the FDIC does provide a different assessment rate, the 
assessment rate cannot be less than two-thirds of the premium 
assessed on other SAIF-insured thrift deposits.
     Oakar banks have paid SAIF premiums based upon a 
statutorily prescribed formula that in some instances may not 
reflect an institution's true SAIF deposit base. It is the 
intention of this section that if inequities exist the FDIC is 
given the authority to reduce the rate of the special 
assessment to be imposed on these institutions.

Sec. 2202. Assessments on insured depository institutions

     Section 2202 spreads the obligation to make payments to 
defease the interest obligations on debt issued by the 
Financing Corporation to all FDIC-insured depository 
institutions as of January 1, 1996. In addition, the section 
requires that the deposit insurance assessment rates on SAIF 
members be no less than the rate imposed on BIF Members.

Sec. 2203. Merger of BIF and SAIF after recapitalization of SAIF

    Section 2203 requires the FDIC to merge the BIF and SAIF on 
January 1, 1998, and establishes a special reserve fund which 
cannot be taken into account in calculating the reserve ratio 
of the merged fund. The reserve fund is to be used when the 
FDIC determines that the reserve ratio is less than 50 percent 
of the designated reserve ratio and the reserve ratio will 
likely be less than the designated reserve for each of the four 
calendar quarters following that determination. In addition, 
this section modifies the Federal Home Loan Bank System's 
[FHLBS] REFCORP allocation formula to take into account the 
merger of the funds. Under the section, the FHLBS contribution 
to REFCORP is changed from a flat $300 million payment to 22.63 
percent of the system's net earnings.

Sec. 2204. Refund of amounts in deposit insurance fund in excess of 
        designated reserve ratio

    Section 2204 allows the FDIC to refund any excess 
semiannual premium assessments when the fund is above the 
designated reserve ratio.

Sec. 2205. Assessments authorized only if needed to maintain the 
        reserve ratio of a deposit insurance fund

    Section 2205 prohibits the FDIC from setting semiannual 
assessments with respect to the deposit insurance fund, in 
excess of the amount needed to: First, maintain the reserve 
ratio of the fund at the designated reserve ratio or second, if 
the reserve ratio is less than the designated reserve ratio, to 
increase the reserve ratio to the designated reserve ratio.

          Chapter 2--Status of Banks and Savings Associations

Sec. 2221. Termination of Federal savings associations; treatment of 
        State savings associations as banks for purposes of Federal 
        banking law

    Section 2221 rescinds the Federal charter for savings 
associations. The section requires Federal savings associations 
to convert to a national bank or State chartered institution by 
January 1, 1998 or surrender its charter by that date. If they 
do not voluntarily convert, they are automatically converted to 
a national bank by operation of law. No new Federal savings 
association charters may be granted after the date of 
enactment.
    The section also provides that for purposes of the Federal 
Deposit Insurance Act, the Bank Holding Company Act and the 
Federal Reserve Act, State savings associations are to be 
treated as State banks.

Sec. 2222. Treatment of certain activities and affiliations of bank 
        holding companies resulting from this act

    Under this section, bank holding companies which were 
savings and loan holding companies as of September 13, 1995, 
may maintain or enter into any affiliation or activity which 
such company was authorized to maintain or enter into as of 
September 22, 1995, or was authorized to maintain following a 
merger of insured depository institution subsidiaries pursuant 
to an application filed no later than that date. To be eligible 
for the grandfather, the section requires that any insured 
depository institution or subsidiary of the holding company 
comply with any lending restrictions which were imposed on it 
as a savings association, that the institution continue to meet 
the qualified thrift lending test, if applicable, and that it 
not be called a national bank--if the institution is a national 
bank. In addition, the holding company loses its grandfather if 
it acquires another depository institution or if it is directly 
or indirectly transferred.

Sec. 2223. Transition provisions for activities of savings associations 
        which convert into or become treated as banks

    This section provides a transition period of 5 years during 
which a savings association which converts to a bank charter 
can continue to conduct activities in which it was lawfully 
engaged but which are not permissible for banks. This 
grandfather also applies to a State savings and loan 
association that becomes subject to restrictions in Federal law 
on its activities as of January 1, 1998. The 5-year transition 
period begins to run from the date a savings association 
converts to a bank charter or from January 1, 1998, whichever 
occurs first.

Sec. 2224. Registration of bank holding companies resulting from 
        conversions of savings associations to banks or treatment of 
        savings associations as banks

    This section provides that savings and loan holding 
companies that become bank holding companies as a result of the 
charter conversion of any savings association or savings bank 
subsidiary into a bank must register with the Federal Reserve 
Board. Such holding companies do not have to obtain the 
approval of the Board to become a bank holding company at the 
time of the charter conversion provided that such company does 
not directly or indirectly acquire any additional insured 
depository institution or other company in connection with the 
conversion. In addition, this section provides guidance to the 
Federal Reserve in connection with its exercise of regulatory 
authority over qualified bank holding companies. It is intended 
that the Board will regulate qualified bank holding companies 
in a manner consistent with the current regulation of such 
companies, including the imposition of capital requirements by 
the OTS and consistent with safety and soundness.

Sec. 2225. Additional transition provisions and special rules

    Section 2225 contains a number of special transition rules 
to facilitate the conversion of thrifts to banks. First, the 
section allows mutual savings associations which convert to 
national banks to maintain their mutual form of ownership and 
allows any national bank which is organized in mutual form to 
reorganize as a stock national bank. It also permits the OCC to 
charter ``de novo'' mutual national banks. The OCC is directed 
to apply the current OTS regulations governing mutual charters 
for 3 years after which time the OCC is directed to promulgate 
substantially similar regulations. The Federal banking agencies 
may not adopt or enforce any regulation which contravenes the 
corporate governance rules prescribed by State law for State 
banks. Second, the section grandfathers existing thrift 
intrastate and interstate branches. Third, it requires that if 
a Federal savings association converts to a national bank 
charter, membership in the Federal Home Loan Bank System must 
be maintained. Fourth, it provides savings associations which 
convert to national banks 3 years to comply with national bank 
limitations on loans to one borrower.

Sec. 2226. Technical and conforming amendments

    This section makes a number of technical and conforming 
amendments including a clarification that housing creditors may 
make purchases and enforce alternative mortgage transactions in 
accordance with OTS regulations issued prior to the effective 
date of Section 3(f) of the Home Owners' Loan Act.

Sec. 2227. References to savings associations and State banks in 
        Federal law

    Under this section, for purposes of all other Federal 
banking laws, a savings association is deemed to be a reference 
to a bank.

Sec. 2228. Repeal of Home Owners' Loan Act

    This section repeals the Home Owners' Loan Act as of 
January 1, 1998.

Sec. 2229. Effective date; definitions

    Section 2229 makes the effective date of the amendments in 
this title January 1, 1998. In addition, the banking terms used 
throughout the title have the same meanings as in the Federal 
Deposit Insurance Act.

       Chapter 3--Transfer of Functions, Personnel, and Property

Sec. 2241. Office of Thrift Supervision abolished

    Section 2241 abolishes the Office of Thrift Supervision 
[OTS] on January 1, 1998.

Sec. 2242. Determination of transferred functions and employees

    This section provides for the transfer of OTS employees and 
property to the Federal Reserve System, the FDIC, and the 
Comptroller of the Currency.

Sec. 2243. Savings provisions

    The section allows for a number of transitional rules 
concerning lawsuits and administrative rules because of the 
abolishment of OTS.

Sec. 2244. References in Federal law to Director of the Office of 
        Thrift Supervision

    This section states that any reference in any Federal law 
to OTS shall be deemed a reference to the appropriate Federal 
banking agency.

Sec. 2245. Reconfiguration of FDIC Board

    Section 2245 reconfigures the FDIC Board in light of the 
abolishment of the Director of OTS. As reconfigured, the FDIC 
Board will have three members.

                 Chapter 4--Loan Loss Reserve Treatment

Sec. 2261. Sense of the Congress

    This section states that it is the sense of Congress that 
the bad debt reserve deduction for thrifts should be repealed 
and that the repeal should be fashioned in such a manner which 
would neither threaten the economic viability of thrift 
institutions which convert to bank charters nor cause the 
Federal treasury to lose revenue.

        subtitle c--community reinvestment act (cra) amendments

Sec. 2301. Expression of congressional intent

    Section 2301 amends the congressional purpose for the CRA 
by stating that in encouraging financial institutions to meet 
the credit needs of their communities, regulators shall not 
impose additional regulatory or paperwork burdens on financial 
institutions.

Sec. 2302. Community Reinvestment Act exemption

    Section 2302 exempts an institution from the examination 
requirements of the CRA if the institution and the holding 
company which controls the institution do not have more than 
$100 million in assets--which is to be adjusted for inflation--
and the institution makes available a notice signed by its 
President listing the services the institution provides to help 
meet the needs of the local community and stating that the bank 
helps meet the credit needs. As provided in section 2307, the 
implementation of this section cannot result in additional 
record keeping or reporting requirements. In addition, failure 
to comply with the requirements of this section shall not 
result in any liability or give rise to any administrative or 
private right of action.

Sec. 2303. Self-certification of Community Reinvestment Act compliance

    Section 2303 allows a financial institution with no more 
than $250 million in assets to self-certify compliance with the 
CRA, provided the institution has not been found to have 
engaged in a pattern or practice of illegal discrimination 
under the Fair Housing Act or the Equal Credit Opportunity Act 
within the past 5 years and has a current CRA rating of 
``satisfactory'' or ``outstanding.'' This section also requires 
the financial institution to maintain a public notice of self-
certification and provides for regulatory review of self-
certification reasonableness during each examination for safety 
and soundness. In addition, this section provides for the 
institution to be examined for CRA compliance if the 
institution's self-certification is found to be ``not 
reasonable.'' If after the regular CRA exam an institution 
receives a less than ``satisfactory'' CRA rating, it may not 
self-certify again for a period of 5 years.

Sec. 2304. Community input and conclusive rating

    Section 2304 amends the CRA to establish a new mechanism 
for community input for an institution's CRA examination by 
providing the public advance notice in the Federal Register of 
an institution's CRA examination. After the Federal financial 
supervisory agency provides such notice and reviews all timely 
comments, the financial institution is provided a conclusive 
CRA rating until its next CRA examination. A reconsideration of 
an institution's rating may be requested within 30 days of the 
disclosure of the rating to the public.
    Under section 2304(c), an institution's CRA record is taken 
into account in the overall evaluation of the condition of an 
institution rather than at the time of an application for a 
deposit facility. Current law requires the regulator to take 
into consideration an institution's CRA record when it applies 
for a deposit facility.

Sec. 2305. Special purpose financial institutions

    Section 2305(a) requires the appropriate Federal financial 
supervisory agency, in evaluating the CRA records of special 
purpose institutions, to take into account the nature of the 
business of such institutions and the amount of deposits 
received by such institutions. Subsection (b) defines the term 
``special purpose institution'' to mean a financial institution 
that does not generally accept deposits in amounts less than 
$100,000. Such institutions include, but are not limited to, 
wholesale, credit card and trust institutions.

Sec. 2306. Increased incentives for lending to low- and moderate-income 
        communities

    Section 2306 revises the CRA to expand the category of 
capital investments, loan participations, and other ventures 
for which an institution can receive CRA credit.

Sec. 2307. Prohibition on additional reporting under community 
        reinvestment act

    This section prohibits the Federal financial institution 
regulators from requiring additional reporting or record 
keeping from financial institutions as a result of any 
regulations prescribed under the CRA.

Sec. 2308. Technical amendment

    This section makes a technical revision to the CRA to 
clarify that the requirement applies only to regulated banks 
with interstate branches.

Sec. 2309. Duplicative reporting

    Section 2309 exempts institutions which are members of the 
Federal Home Loan Bank System from meeting the Federal Home 
Loan Bank Act's community investment and service requirements 
if the institution has received a CRA rating of ``outstanding'' 
or ``satisfactory''.

Sec. 2310. Community Reinvestment Act congressional oversight

    Section 2310 requires each Federal banking agency to report 
to Congress by December 31, 1996 and by December 31, 1997, 
respectively, on the implementation of the CRA regulations 
prescribed after the date of enactment of H.R. 1858. These 
reports are to include input from the regulated financial 
institutions and quantifiable measures of the cost savings of 
the new CRA regulations and their effectiveness in achieving 
CRA objectives.

Sec. 2311. Consultation among examiners

    Section 2311 is intended to reduce the burden placed on 
banks as a result of multiple exams by requiring each agency to 
direct its examiners to consult on examination activities 
related to an institution and resolve any inconsistencies in 
the examiners' recommendations. In addition, section 2311 
directs that each agency appoint an ``examiner-in-charge'' who 
is responsible for consultation with all examiners of an 
institution.

Sec. 2312. Limitation on regulations

    Section 2312 provides that no CRA regulation may be 
promulgated which would require financial institutions to make 
loans to any uncreditworthy person that would jeopardize the 
safety and soundness of the institution. In addition, no 
regulation prescribed under the CRA shall require a financial 
institution to make a loan on the basis of any discriminatory 
criteria prohibited under any U.S. law. It also clarifies that 
no regulation shall prevent or hinder in any way a financial 
institution's full responsibility to provide credit to all 
segments of its community. Finally, it clarifies that these 
regulations shall encourage financial institutions to extend 
credit to all creditworthy persons, consistent with safety and 
soundness.

                   Committee Consideration and Votes

                      (Rule XI, Clause 2(l)(2)(B))

    On September 19, 1995 the committee met in open session to 
mark up the Budget Reconciliation recommendations. The 
committee considered as original text for purposes of amendment 
a committee print.
    During the markup the committee approved by recorded vote 
one amendment to the committee print. The committee also 
defeated by recorded vote seven amendments. The following 
amendment was adopted by recorded vote.
    An amendment offered by Mr. Stockman to allow housing 
creditors to offer certain alternative mortgage transactions 
despite State law to the contrary passed 25-14.
        YEAS                          NAYS
Mr. Leach                           Mr. Gonzalez
Mr. McCollum                        Mr. LaFalce
Mrs. Roukema                        Mr. Frank
Mr. Bereuter                        Mr. Kennedy
Mr. Roth                            Mr. Flake
Mr. Baker                           Ms. Waters
Mr. Lazio                           Mr. Orton
Mr. Bachus                          Mrs. Maloney
Mr. Castle                          Ms. Roybal-Allard
Mr. King                            Mr. Barrett
Mr. Royce                           Mr. Wynn
Mr. Weller                          Mr. Watt
Mr. Hayworth                        Mr. Ackerman
Mr. Metcalf                         Mr. Bentsen
Mr. Bono
Mr. Ehrlich
Mr. Barr
Mr. Chrysler
Mr. Cremeans
Mr. Fox
Mr. Heineman
Mr. Stockman
Mr. LoBiondo
Mr. Watts
Mrs. Kelly

    The following amendments were defeated by recorded vote.
    An amendment offered by Mr. Kennedy to strike section 2101 
which terminates RTC and FDIC affordable housing programs was 
defeated 19-21.
        YEAS                          NAYS
Mr. Bachus                          Mr. Leach
Mr. Gonzalez                        Mrs. Roukema
Mr. LaFalce                         Mr. Bereuter
Mr. Frank                           Mr. Roth
Mr. Kanjorski                       Mr. Lazio
Mr. Kennedy                         Mr. Castle
Mr. Flake                           Mr. King
Ms. Waters                          Mr. Royce
Mr. Sanders                         Mr. Lucas
Mrs. Maloney                        Mr. Weller
Mr. Gutierrez                       Mr. Hayworth
Ms. Roybal-Allard                   Mr. Bono
Mr. Barrett                         Mr. Ney
Ms. Velazquez                       Mr. Ehrlich
Mr. Wynn                            Mr. Cremeans
Mr. Watt                            Mr. Fox
Mr. Hinchey                         Mr. Heineman
Mr. Ackerman                        Mr. Stockman
Mr. Bentsen                         Mr. LoBiondo
                                    Mr. Watts
                                    Mrs. Kelly

    An amendment offered by Mr. Kennedy to strike section 2103 
which terminates a HUD-owned multifamily property disposition 
program was defeated 22-24.
        YEAS                          NAYS
Mr. Fox                             Mr. Leach
Mr. Gonzalez                        Mr. McCollum
Mr. Lafalce                         Mrs. Roukema
Mr. Vento                           Mr. Bereuter
Mr. Schumer                         Mr. Roth
Mr. Frank                           Mr. Baker
Mr. Kanjorski                       Mr. Lazio
Mr. Kennedy                         Mr. Bachus
Mr. Flake                           Mr. Castle
Mr. Mfume                           Mr. King
Ms. Waters                          Mr. Royce
Mr. Orton                           Mr. Lucas
Mr. Sanders                         Mr. Weller
Mrs. Maloney                        Mr. Metcalf
Ms. Roybal-Allard                   Mr. Bono
Mr. Barrett                         Mr. Ney
Ms. Velazquez                       Mr. Ehrlich
Mr. Wynn                            Mr. Barr
Mr. Watt                            Mr. Chrysler
Mr. Hinchey                         Mr. Heineman
Mr. Ackerman                        Mr. Stockman
Mr. Bentsen                         Mr. LoBiondo
                                    Mr. Watts
                                    Mrs. Kelly

    An amendment offered by Mr. Sanders to strike section 2104 
which recaptures rural housing loan subsidies was defeated 19-
22.
        YEAS                          NAYS
Mr. LaFalce                         Mr. Leach
Mr. Vento                           Mr. McCollum
Mr. Schumer                         Mrs. Roukema
Mr. Frank                           Mr. Bereuter
Mr. Kanjorski                       Mr. Roth
Mr. Kennedy                         Mr. Baker
Mr. Flake                           Mr. Lazio
Mr. Mfume                           Mr. Castle
Ms. Waters                          Mr. King
Mr. Orton                           Mr. Royce
Mr. Sanders                         Mr. Lucas
Mrs. Maloney                        Mr. Weller
Ms. Roybal-Allard                   Mr. Bono
Mr. Barrett                         Mr. Ney
Ms. Velazquez                       Mr. Barr
Mr. Wynn                            Mr. Chrysler
Mr. Watt                            Mr. Fox
Mr. Hinchey                         Mr. Heineman
Mr. Bentsen                         Mr. Stockman
                                    Mr. LoBiondo
                                    Mr. Watts
                                    Mrs. Kelly

    An amendment offered by Mr. McCollum to rescind Federal 
deposit insurance for State savings and loan associations was 
defeated 15-20.
        YEAS                          NAYS
Mr. Leach                           Mrs. Roukema
Mr. McCollum                        Mr. Bachus
Mr. Bereuter                        Mr. Royce
Mr. Roth                            Mr. Bono
Mr. Baker                           Mr. Barr
Mr. Lazio                           Mr. Stockman
Mr. Castle                          Mr. LoBiondo
Mr. King                            Mr. Watts
Mr. Weller                          Mr. Gonzalez
Mr. Hayworth                        Mr. LaFalce
Mr. Metcalf                         Mr. Vento
Mr. Ehrlich                         Mr. Kennedy
Mr. Chrysler                        Mr. Flake
Mrs. Kelly                          Ms. Mfume
Mr. Orton                           Ms. Waters
                                    Ms. Roybal-Allard
                                    Ms. Velazquez
                                    Mr. Wynn
                                    Mr. Watt
                                    Mr. Bentsen

    An amendment offered by Mr. Bereuter to strike the bill's 
requirement that small banks provide public notices of the 
types of credit and services they provide to their local 
communities thereby restoring the bill's CRA provisions to the 
language passed by the committee as part of H.R. 1858 was 
defeated by a rollcall vote of 20 ayes to 26 nays.
        YEAS                          NAYS
Mr. McCollum                        Mr. Leach
Mrs. Roukema                        Mr. Lazio
Mr. Bereuter                        Mr. Castle
Mr. Roth                            Mr. Stockman
Mr. Baker                           Mr. Watts
Mr. Bachus                          Mr. Gonzalez
Mr. King                            Mr. LaFalce
Mr. Royce                           Mr. Vento
Mr. Weller                          Mr. Frank
Mr. Hayworth                        Mr. Kennedy
Mr. Metcalf                         Mr. Flake
Mr. Bono                            Mr. Mfume
Mr. Ehrlich                         Ms. Waters
Mr. Barr                            Mr. Orton
Mr. Chrysler                        Mr. Sanders
Mr. Cremeans                        Mrs. Maloney
Mr. Fox                             Mr. Gutierrez
Mr. Heineman                        Ms. Roybal-Allard
Mr. LoBiondo                        Mr. Barrett
Mrs. Kelly                          Ms. Velazquez
                                    Mr. Wynn
                                    Mr. Fields
                                    Mr. Watt
                                    Mr. Hinchey
                                    Mr. Ackerman
                                    Mr. Bentsen

    An amendment offered by Mr. Kennedy to strike subtitle C 
which makes a number of amendments to the Community 
Reinvestment Act was defeated by a rollcall vote of 20 ayes to 
24 nays.
        YEAS                          NAYS
Mr. Gonzalez                        Mr. Leach
Mr. LaFalce                         Mr. McCollum
Mr. Vento                           Mrs. Roukema
Mr. Kanjorski                       Mr. Bereuter
Mr. Kennedy                         Mr. Roth
Mr. Flake                           Mr. Baker
Mr. Mfume                           Mr. Bachus
Ms. Waters                          Mr. Castle
Mr. Orton                           Mr. King
Mr. Sanders                         Mr. Royce
Mr. Gutierrez                       Mr. Weller
Ms. Roybal-Allard                   Mr. Hayworth
Mr. Barrett                         Mr. Metcalf
Ms. Velazquez                       Mr. Bono
Mr. Wynn                            Mr. Ehrlich
Mr. Fields                          Mr. Barr
Mr. Watt                            Mr. Chrysler
Mr. Hinchey                         Mr. Cremeans
Mr. Ackerman                        Mr. Fox
Mr. Bentsen                         Mr. Heineman
                                    Mr. Stockman
                                    Mr. LoBiondo
                                    Mr. Watts
                                    Mrs. Kelly
      
    An amendment offered by Mr. Chrysler to change the name of 
the Community Reinvestment Act to the Urban, Suburban, and 
Rural Loan Program was defeated 19-27.
        YEAS                          NAYS
Mr. Leach                           Mrs. Roukema
Mr. McCollum                        Mr. Castle
Mr. Bereuter                        Mr. King
Mr. Roth                            Mr. Metcalf
Mr. Baker                           Mr. LoBiondo
Mr. Bachus                          Mr. Watts
Mr. Royce                           Mrs. Kelly
Mr. Lucas                           Mr. Gonzalez
Mr. Weller                          Mr. LaFalce
Mr. Hayworth                        Mr. Vento
Mr. Bono                            Mr. Kanjorski
Mr. Ney                             Mr. Kennedy
Mr. Ehrlich                         Mr. Flake
Mr. Barr                            Mr. Mfume
Mr. Chrysler                        Ms. Waters
Mr. Cremeans                        Mr. Orton
Mr. Fox                             Mr. Sanders
Mr. Heineman                        Mr. Gutierrez
Mr. Stockman                        Ms. Roybal-Allard
                                    Mr. Barrett
                                    Ms. Velazquez
                                    Mr. Wynn
                                    Mr. Fields
                                    Mr. Watt
                                    Mr. Hinchey
                                    Mr. Ackerman
                                    Mr. Bentsen

    After adopting the committee print as amended, a motion to 
submit recommendations for budget reconciliation in the 
committee print to the Budget Committee passed 26-20.
        YEAS                          NAYS
Mr. Leach                           Mr. Gonzalez
Mr. McCollum                        Mr. LaFalce
Mrs. Roukema                        Mr. Vento
Mr. Bereuter                        Mr. Kanjorski
Mr. Roth                            Mr. Kennedy
Mr. Baker                           Mr. Flake
Mr. Bachus                          Mr. Mfume
Mr. Castle                          Ms. Waters
Mr. King                            Mr. Orton
Mr. Royce                           Mr. Sanders
Mr. Lucas                           Mr. Gutierrez
Mr. Weller                          Ms. Roybal-Allard
Mr. Hayworth                        Mr. Barrett
Mr. Metcalf                         Ms. Velazquez
Mr. Bono                            Mr. Wynn
Mr. Ney                             Mr. Fields
Mr. Ehrlich                         Mr. Watt
Mr. Barr                            Mr. Hinchey
Mr. Chrysler                        Mr. Ackerman
Mr. Cremeans                        Mr. Bentsen
Mr. Fox
Mr. Heineman
Mr. Stockman
Mr. LoBiondo
Mr. Watts
Mrs. Kelly

                  Congressional Budget Office Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 6, 1995.
Hon. James A. Leach,
Chairman, Committee on Banking and Financial Services,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the reconciliation 
recommendations of the House Committee on Banking ad Financial 
Services.
    The estimate shows the budgetary effects of the committee's 
proposals over the 1996-2002 period. CBO understands that the 
Committee on the Budget will be responsible for interpreting 
how these proposals compare with the reconciliation 
instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    1. Bill number: Not yet assigned.
    2. Bill title: Reconciliation Recommendations of the House 
Committee on Banking ad Financial Services.
    3. Bill status: As approved by the House Committee on 
Banking and Financial Services on September 19, 1995.
    4. Bill purpose: Deposit Insurance Funds. The bill would 
make a number of changes that would affect insured depository 
institutions and the financial regulatory agencies, including 
the Federal Deposit Insurance Corporation [FDIC], the Office of 
the Comptroller of the Currency [OCC], the Office of Thrift 
Supervision [OTS], and the Board of Governors of the Federal 
Reserve System. It would:
          Require members of the Savings Association Insurance 
        Fund [SAIF] to pay a one-time assessment on January 1, 
        1996, in an amount sufficient to boost reserves of the 
        fund to 1.25 percent of insured deposits; allow certain 
        banks that hold thrift deposits a discount of up to 
        one-third of the rate that other SAIF-insured 
        institutions are assessed; and allow financially weak 
        thrifts to pay the special assessment over 4 years;
          Require institutions insured by the Bank Insurance 
        Fund [BIF] to join SAIF-insured members in paying a 
        proportional share of the annual interest payment on 
        bonds issued by the Financing Corporation [FICO];
          Merge the BIF and the SAIF on January 1, 1998, and 
        until such time, require SAIF-insured institutions to 
        pay insurance premiums at least equal to the premiums 
        paid by BIF-insured institutions;
          Resrict the use of any surplus reserves that 
        accumulate in the SAIF through January 1998, but allow 
        the FDIC to refund excess reserves in the BIF and in 
        the new deposit insurance fund created by the BIF-SAIF 
        merger;
          Abolish Federal thrift charters as of January 1, 
        1998, requiring each Federal savings association to 
        convert to a national bank charter or to become a 
        state-chartered thrift or bank;
          Abolish OTS, transferring its responsibilities to the 
        agencies that regulate and examine federally-chartered 
        banks [OCC] and State-chartered banks and thrifts [FDIC 
        and Federal Reserve]; and
          Reduce the number of directors on the board of the 
        FDIC from five to three.
    The Federal Housing Administration's [FHA's] Single-Family 
Assignment Program. Section 2102 would prohibit the Department 
of Housing and Urban Development [HUD] from providing 
foreclosure avoidance relief to mortgagors who have defaulted 
in making payments on a FHA-insured single-family mortgage.
    FHA Multifamily Property Disposition. Section 2103 would 
enable HUD to dispose of multifamily properties held in its 
inventory without providing any rental assistance upon the sale 
of these properties.
    Rent Adjustment for Section 8 Housing. Section 2105 would 
reduce rent increases for units receiving assistance under 
section 8 of the United States Housing Act, which authorizes 
rental assistance payments on behalf of low-income tenants.
    Rural Housing Loan Subsidies. Section 2104 would amend the 
Rural Housing Act of 1949 to require the immediate payment of a 
portion of the interest subsidies by the borrower upon the 
repayment of a single-family housing loan made by the 
Department of Agriculture.
    Affordable Housing Programs. The bill would end various 
programs of the Resolution Trust Corporation [RTC] and the FDIC 
that make housing available to low- and very-low-income 
persons, and also would terminate the Affordable Housing 
Advisory Board. Any remaining responsibilities associated with 
the affordable housing programs of the RTC and the FDIC, as 
well as the task of enforcing low-income occupancy 
requirements, would be transferred to HUD.
    Payments to the Resolution Funding Corporation [REFCORP]. 
The Federal Home Loan Bank [FHLB] system is a government-
sponsored enterprise consisting of 12 district banks that make 
low-cost loans to home mortgage lenders. Since 1989, the FHLB's 
have had to pay $300 million annually to REFCORP to support 
interest payments on bonds issued to help finance the 
resolution of the savings and loan crisis. The proposal would 
eliminate the requirement that the FHLB's make a fixed $300 
million payment and would instead require them to contribute 
22.63 percent of their net earnings each year to pay part of 
the interest due to REFCORP bondholders.
    Community Reinvestment Act. Subtitle C would reduce the 
examination requirements specified in the Community 
Reinvestment Act [CRA]. The bill would exempt most financial 
institutions with assets of up to $100 million (indexed for 
inflation) from examinations for compliance with CRA. In 
addition, institutions with assets over $100 million but not 
more than $250 million (also indexed) would be allowed to 
certify their own compliance, making them subject to less 
frequent and less stringent examinations.
    5. Estimated cost to the Federal Government: Table 1 
summarizes the budgetary effects of these proposals for the 
1996-2002 period. In total, CBO estimates the committee's 
proposals would reduce direct spending by about $4 billion, and 
would increase revenues by $22 million over the 1996-2002 
period. The bill would also provide for potential discretionary 
savings of $473 million over the next 7 years, but that amount 
would be subject to appropriations action.

    TABLE 1. BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON BANKING AND FINANCIAL   
                                                    SERVICES                                                    
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                              1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Deposit Insurance Funds:                                                                                        
    Estimated Budget Authority............  ........  ........  ........  ........  ........  ........  ........
    Estimated Outlays.....................    -5,000       400       800       800       700       700       700
FHA Single-Family Assignment Program:                                                                           
    Estimated Budget Authority............      -850      -108      -117      -134      -154      -159      -159
    Estimated Outlays.....................      -850      -108      -117      -134      -154      -159      -159
FHA Multifamily Property Disposition:                                                                           
    Estimated Budget Authority............  \1\ -140  ........  ........  ........  ........  ........  ........
    Estimated Outlays.....................  \1\ -140  ........  ........  ........  ........  ........  ........
Rent Adjustment for Section 8 Housing:                                                                          
    Estimated Budget Authority............  ........  ........  ........  ........  ........  ........  ........
    Estimated Outlays.....................   \2\ -42      -219      -248      -231      -210      -189      -175
Rural Housing Loan Subsidies:                                                                                   
    Estimated Budget Authority............       -39  ........  ........  ........  ........  ........  ........
    Estimated Outlays.....................       -39  ........  ........  ........  ........  ........  ........
RTC Affordable Housing Program:                                                                                 
    Estimated Budget Authority............       -31  ........  ........  ........  ........  ........  ........
    Estimated Outlays.....................       -10       -10        -8        -2        -1        -1  ........
Treasury Payment to REFCORP:                                                                                    
    Estimated Budget Authority............  ........  ........         7        11        15        16        16
    Estimated Outlays.....................  ........  ........         7        11        15        16        16
                                           ---------------------------------------------------------------------
      Total Estimated Changes in Direct                                                                         
       Spending:                                                                                                
        Estimated Budget Authority........    -1,060      -108      -110      -123      -139      -143      -143
                                           =====================================================================
        Estimated Outlays.................    -6,081        63       434       444       350       367       382
                                           =====================================================================
                                                                                                                
                                               CHANGES IN REVENUES                                              
                                                                                                                
Federal Reserve Surplus...................         2         3         3         3         3         4         4
                                                                                                                
                                                                                                                
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATIONS                                 
                                                                                                                
Rent Adjustment for Section 8 Housing:                                                                          
    Estimated Authorization Level.........       -40       -50       -65       -90       -92       -93       -94
    Estimated Outlays.....................        -1       -17       -41       -65       -75       -84       -91
FDIC Affordable Housing Program                                                                                 
    Estimated Authorization Level.........       -15       -15       -15       -15       -15       -15       -15
    Estimated Outlays.....................        -9       -15       -15       -15       -15       -15       -15
----------------------------------------------------------------------------------------------------------------
\1\ This table shows changes relative to current law. If the VA/HUD appropriation bill is enacted before this   
  provision, and if it permits HUD to sell multifamily properties in fiscal year 1996 without providing any rent
  subsidy, the reconciliation provision would produce savings of $100 million in 1996, instead of $140 million. 
\2\ If the VA/HUD appropriation bill is enacted before this provision, and if it includes a similar provision   
  applying only to fiscal year 1996, the reconciliation provision would produce no savings in 1996.             

    The budgetary impact of this bill falls within budget 
functions 370, 600, and 900.
    6. Basis of estimate: This estimate assumes that the 
reconciliation bill will be enacted by November 15, 1995; the 
estimate could change if the bill is enacted later.

                            DIRECT SPENDING

    Deposit Insurance Funds. Under the bill's provisions, CBO 
estimates that savings and loan institutions would pay over $6 
billion in 1996 to ensure that the SAIF's reserves would reach 
$1.25 for each $100 of insured deposits. While the precise 
amount of payments will depend upon the reserve balance at the 
end of 1995, as well as on the FDIC's estimate of future 
losses, we expect that thrifts would be assessed about 85 cents 
per $100 of domestic deposits to recapitalize the fund. Because 
net 1996 assessments under current law would be about $0.9 
billion, we estimate that the one-time special assessment would 
increase collections by $5.2 billion in 1996.
    The additional assessment income would be partially offset 
by decreases in collections for two reasons--lower premiums 
paid by thrifts in subsequent years and rebates paid to banks 
in 1996. These offsets, which are discussed below, would total 
$4.3 billion, resulting in net savings of $0.9 billion over the 
1996-2002 period.

       TABLE 2. THE BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS AFFECTING THE DEPOSIT INSURANCE FUNDS      
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                    1995      1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
BIF and SAIF Spending Under                                                                                     
 Current Law:                                                                                                   
    Estimated Budget Authority..  ........  ........  ........  ........  ........  ........  ........  ........
    Estimated Outlays...........    -8,000    -2,400    -1,700    -2,200    -1,800    -1,100    -1,600    -1,700
Proposed Changes:                                                                                               
    Estimated Budget Authority..  ........  ........  ........  ........  ........  ........  ........  ........
    Estimated Outlays...........  ........    -5,000       400       800       800       700       700       700
BIF and SAIF Spending Under                                                                                     
 Proposal:                                                                                                      
    Estimated Budget Authority..  ........  ........  ........  ........  ........  ........  ........  ........
    Estimated Outlays...........    -8,000    -7,400    -1,300    -1,400    -1,000      -400      -900    -1,000
----------------------------------------------------------------------------------------------------------------

    Under current law, CBO estimates that the SAIF would be 
fully recapitalized late in 2002 and that thrifts would be 
paying premiums of about $0.8 billion a year into the SAIF 
until that time. With the one-time assessment required by this 
bill, net thrift premiums would drop to $0.4 billion in 1997 
and to less than $0.1 billion thereafter. Thus, the special 
assessment would accelerate the payment of insurance premiums 
that thrifts make to the SAIF--from annual payments through 
2002 (under current law) to a one-time payment in 1996 (as 
required by the bill). Aggregate thrift premiums retained by 
the deposit insurance funds over the 7-year period would be 
higher than under current law by an estimated $1.1 billion for 
three reasons: the thrift deposit base would probably be 
greater; less of the thrifts' premiums would be siphoned off to 
pay FICO interest; and premium rates for SAlF-insured 
institutions would be slightly higher than would otherwise be 
necessary because they would have to equal rates paid by BIF-
insured institutions.
    The bill would authorize the FDIC to refund assessment 
premiums in excess of the reserve ratio required under current 
law, or $1.25 per $100 of insured deposits. CBO expects that 
the FDIC would credit $0.2 billion against the premiums that 
BIF members otherwise would pay in 1996, resulting in a loss of 
premiums of that amount.
    The bill would allow the FDIC to reduce by as much as one-
third the amount of the special assessment paid by certain 
banks that have deposits insured by the SAIF--primarily the so-
called Oakar banks. However, this provision requires that the 
net budgetary effect of such a reduction in the amount paid by 
Oakar banks be budget-neutral. Therefore, CBO assumes that the 
FDIC would increase the rate charged to the non-Oakar banks to 
make up for any shortfall to ensure that the fund balance would 
still reach the target of $1.25 for each $100 of insured 
deposits.
    Another provision of the bill would require the FDIC to set 
rates for insurance premiums sufficient only to maintain the 
reserves of the insurance fund at the statutory level. This 
provision would have no significant cost relative to the CBO 
baseline, which assumes losses sufficiently large that the FDIC 
would not face a situation in the immediate future where it 
would collect no premiums. If future insurance losses are very 
low, however, the provision could result in the FDIC setting 
premiums at zero for all insured institutions, effectively 
eliminating the risk-based system used to determine premiums 
for deposit insurance. Assessing deposit premiums based on the 
risk posed to the insurance funds creates an incentive for 
institutions to minimize their risks, thereby also minimizing 
potential losses to the insurance funds. Thus, eliminating this 
incentive could result in greater long-run costs to the FDIC.
    Because the bill would abolish Federal thrift charters in 
1998, some 1,200 institutions would be forced to become 
federally chartered banks or State-chartered institutions, or 
to terminate their charters. Closing the OTS would eliminate 
that agency's costs of examining and regulating Federal savings 
and loans, but these costs would be spread among the three 
remaining Federal regulators--the FDIC, the Federal Reserve, 
and the OCC, depending upon which charter each institution 
adopts. CBO cannot predict how institutions will behave if 
their Federal charter is abolished, but we would expect that 
they would consider a number of factors, including regulatory 
costs, tax consequences, and issues affecting the various 
powers offered by the different Federal and State banking 
charters. Institutions switching to charters regulated by the 
FDIC and the OCC would pay higher fees or premiums to cover the 
costs associated with any increase in workload, resulting in no 
net budgetary impact.
    FHA Provisions. Two of the bill's provisions would affect 
the spending and receipts of the Federal Housing Administration 
[FHA]. The estimated budgetary effects are summarized in table 
3.

   TABLE 3. THE BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS TO ELIMINATE THE FHA SINGLE-FAMILY ASSIGNMENT  
                             PROGRAM AND TO REFORM MULTIFAMILY PROPERTY DISPOSITION                             
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                    1995      1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
Spending Under Current Law--FHA                                                                                 
 Liquidating Accounts: \1\                                                                                      
    Estimated Budget Authority..      -862      -930    -1,740    -1,832      -762      -351      -351      -351
    Estimated Outlays...........      -937    -1,005    -1,815    -2,086    -1,110      -682      -682      -682
Proposed Changes--Single-Family                                                                                 
 Assignment Program:                                                                                            
    Estimated Budget Authority..  ........      -850      -108      -117      -134      -154      -159      -159
    Estimated Outlays...........  ........      -850      -108      -117      -134      -154      -159      -159
Multifamily Property                                                                                            
 Disposition:                                                                                                   
    Estimated Budget Authority..  ........      -140  ........  ........  ........  ........  ........  ........
    Estimated Outlays...........  ........      -140  ........  ........  ........  ........  ........  ........
                                 -------------------------------------------------------------------------------
      Total Changes:                                                                                            
        Estimated Budget                                                                                        
         Authority..............  ........      -990      -108      -117      -134      -154      -159      -159
                                 ===============================================================================
        Estimated Outlays.......  ........      -990      -108      -117      -134      -154      -159      -159
                                 ===============================================================================
Spending Under Proposals--FHA                                                                                   
 Liquidating Accounts                                                                                           
    Estimated Budget Authority..      -862    -1,920    -1,848    -1,949      -896      -505      -510      -510
    Estimated Outlays...........      -937    -1,995    -1,923    -2,203    -1,244      -836      -841      -841
----------------------------------------------------------------------------------------------------------------
\1\ These spending figures represent net spending from FHA's Mutual Mortgage Insurance and General Insurance/   
  Special Risk Insurance liquidating accounts. These accounts include both income and expenses incurred. The    
  programs affected by the reconciliation provisions account for only a portion of these two accounts.          

    Elimination of FHA's Single-Family Assignment Program. 
Under current law, FHA provides an alternative to foreclosure 
for certain borrowers who have become delinquent on their 
mortgage payments. To assist these eligible borrowers, FHA pays 
a full claim to the mortgagee, takes assignment of the 
mortgage, and provides the borrower with up to 3 years of 
financial relief by reducing or suspending the borrower's 
mortgage payments. According to HUD, over 50 percent of those 
borrowers who enter the assignment program for the full 3 years 
do not recover financially and eventually go to foreclosure. 
The Mutual Mortgage Insurance liquidating account incurs the 
costs associated with losses from guarantees funded prior to 
fiscal year 1996.
    Section 2102 of this bill would eliminate the assignment 
program, enabling HUD to foreclose quickly on properties that 
would otherwise enter the assignment program. CBO estimates 
that more rapid foreclosure would reduce HUD's costs by 
decreasing the amount of taxes and other expenses that HUD 
would pay while holding these properties. Early foreclosures 
also would expedite the receipt of sales revenues that HUD 
would collect on the affected properties.
    CBO estimates that, under current law, about 90,000 
properties from guarantees made prior to fiscal year 1996 will 
enter the assignment program over the next 10 years. We also 
estimate that about 16 percent of all claims from new loan 
guarantees will eventually enter the assignment program. Based 
on information provided by HUD, we estimate that eliminating 
the assignment program would decrease HUD's losses on mortgages 
that would otherwise enter that program by an average of 30-40 
percent of the unpaid balances. CBO estimates that this 
increase in recoveries would result in about $1.7 billion in 
savings over the next 7 years, when measured on a present value 
basis as required by the Federal Credit Reform Act of 1990.
    Part of these savings--about $800 million in fiscal year 
1996--represents the decrease in subsidy costs associated with 
guarantees issued prior to fiscal year 1996. This amount would 
be reflected as a reduction in direct spending in fiscal year 
1996. The remaining savings--about $900 million--represent the 
net decrease in subsidy costs of loan guarantees in 1996 and 
subsequent years. Such guarantees result in offsetting receipts 
on the budget because the credit subsidies are estimated to be 
negative, and the estimated change in those receipts would be 
recorded in the years that new loans are guaranteed.
    FHA Multifamily Property Disposition. Under current law, 
when selling properties acquired through defaults on FHA-
insured mortgages, HUD must provide long-term rental assistance 
through its section 8 program to about 85 percent of the units 
in subsidized properties and 15 percent of the units in 
unsubsidized properties. Given this requirement, CBO estimates 
that, under current law, HUD will dispose of about 90,000 
multifamily units over the fiscal years 1996-2002. We expect 
that about 5,000 units will enter the inventory each fiscal 
year and that over the 7-year period FHA's General and Special 
Risk Insurance liquidating account will incur holding costs of 
about $390 million.
    Section 2103 of this bill would enable HUD to sell 
properties without providing any section 8 assistance upon 
disposition. CBO estimates that eliminating the rental 
assistance requirement would enable HUD to sell about 11,000 
additional units over the 1996-2002 period. HUD would save on 
its holding costs as a result of these additional property 
sales and, in accordance with scorekeeping procedures for 
credit programs, the savings associated with earlier sales and 
decreased holding costs would result in decreased credit 
subsidies, estimated on a present value basis. CBO estimates 
that eliminating the requirement for long-term rental 
assistance would result in $140 million in savings from more 
rapid property disposition. That savings would be recorded in 
fiscal year 1996.
    Rent Adjustment for Section 8 Housing. Section 8 of the 
United States Housing Act of 1937 provides for an annual 
adjustment in the maximum rents that owners receive on behalf 
of assisted tenants. The bill would make permanent a provision 
enacted in the appropriations act for 1995 that reduces by 1 
percentage point rent increases for units occupied by the same 
families at the time of the last annual rental adjustments. 
Because the government pays part of these rental costs, CBO 
estimates that this provision would save the government $42 
million in 1996 and $1.3 billion over the 1996-2002 period on 
subsidies for existing rental contracts. CBO estimates that 
this provision would affect between 80 percent and 85 percent 
of assisted units in a given year--about 1.9 million in 1996. 
The number of units would drop significantly each year as 
contracts expire, declining to about 400,000 by 2002. The 
savings related to existing contracts would be considered 
direct spending savings because they would affect outlays from 
budget authority provided in previous years.
    Savings that would result from application of this 
provision to future new contracts or contract renewals would 
depend on annual appropriation levels and thus would not be 
considered direct spending. Assuming that annual funding for 
renewing expiring contracts would continue at the 1995 level of 
$2.1 billion, CBO estimates that this provision would produce 
savings from future appropriations of $374 million over the 
1996-2000 period.
    Recapture of Rural Housing Loan Subsidies. The Rural 
Housing Act of 1949 authorizes the U.S. Department of 
Agriculture to provide subsidized direct mortgage loans to low-
income households for the purchase of single-family residences. 
Current law requires the borrowers to repay the Federal 
Government a portion of the subsidy upon nonoccupancy or 
disposition of the property. Section 2104 of the bill would 
require that recaptured subsidies be repaid when the loan is 
satisfied.
    We estimate that this provision would result in outlay 
savings of $39 million for fiscal year 1996 to the liquidating 
account of the Rural Housing Insurance Fund. The outlay effect 
is the discounted present value of the estimated changes in 
annual payments to the Treasury, as required by the Federal 
Credit Reform Act of 1990.
    Estimates of subsidy repayments were based on information 
for the past 5 years provided by the Rural Housing and 
Community Development Service. The provision is likely to 
reduce the number of borrowers who refinance loans because of 
the requirement that subsidies be repaid. The estimated 
budgetary savings reflects this factor.
    Affordable Housing Programs. The bill would eliminate the 
affordable housing programs of the RTC and the FDIC, while 
transferring to HUD responsibility for selling properties 
already in the pipeline and monitoring compliance. Including 
subsidies associated with sales of single-family and 
multifamily RTC properties sold below market prices, plus the 
cost of administering, holding and financing these properties, 
CBO estimates that eliminating the affordable housing programs 
would reduce direct spending by $10 million in 1996, and by $31 
million over the 1996-2002 period.
    Payments to REFCORP. The FHLB's pay $300 million annually 
to REFCORP for interest on bonds issued to finance the 
resolution of the savings and loan crisis. The bill would 
change the amount paid annually by the FHLB's to REFCORP from 
$300 million to 22.63 percent of each home loan bank's annual 
net earnings beginning in 1998. As a result, CBO estimates that 
beginning in 1998 and extending through 2002, the FHLB's 
payments to REFCORP would decrease by $65 million.
    Currently, the FHLB's do not earn enough income from their 
core business alone to cover the fixed $300 million payment and 
pay a market return to their shareholders. As a result, they 
have increased the size of their investment portfolios 
significantly. With the REFCORP payment converted from a fixed 
to a proportional obligation, CBO expects that the FHLB's would 
reduce the size of their investment portfolios. The effect 
would be to reduce the Federal Government's exposure to 
potential risk from this government-sponsored enterprise, but 
also to reduce the net earnings of the FHLB's, thus resulting 
in lower payments to REFCORP. This shortfall would be paid by 
the Treasury, which has responsibility for paying the 
difference between the total interest owed to bondholders 
annually--$2.6 billion--and the amount paid by the FHLB's. 
Hence, Federal outlays would increase by $65 million over the 
1998-2002 period.

                                REVENUES

    Regulatory Costs of the Federal Reserve. The CRA provisions 
would result in less frequent and less stringent examinations, 
thereby increasing revenues by decreasing the operating costs 
of the Federal Reserve System. Based on information provided by 
staff members of the Board of Governors of the Federal Reserve 
System, we estimate that the CRA changes would enable the 
Federal Reserve to save $22 million in examination costs from 
1996 to 2002. Because the Federal Reserve System remits its 
surplus to the Treasury, those reductions in costs would raise 
governmental receipts, or revenues, by the same amount.
    CBO estimates that terminating the Federal thrift charter 
and the Office of Thrift Supervision would not significantly 
affect the examination costs of the Federal Reserve. The 
Federal Reserve would become responsible for examining thrifts 
that convert to a State charter and also choose to become 
members of the Federal Reserve System. But we expect that 
relatively few thrifts would come under the purview of the 
Federal Reserve. In addition, savings and loan holding 
companies would become bank holding companies, which are also 
examined by the Federal Reserve, but we expect that those 
additional costs to the Federal Reserve would be insignificant.
    Taxation of Bad Debt Reserves of Thrifts. By terminating 
the Federal charter for thrift institutions, the bill could 
affect revenues from the corporate income tax. Thrift 
institutions receive preferential tax treatment of their bad 
debt reserve, and many might be subject to increased taxes upon 
becoming banks. The Joint Committee on Taxation would estimate 
such a revenue effect for the Congress, but an estimate for 
this provision is not available at this time.

                   SPENDING SUBJECT TO APPROPRIATIONS

    The FDIC's affordable housing program is discretionary and 
subject to appropriation action. Spending under current law is 
projected to total about $15 million annually, based on the 
1995 appropriations. The bill would eliminate the program.
    7. Estimated cost to State and local governments: CBO 
estimates that one provision of the House Banking Committee's 
reconciliation recommendations for fiscal year 1996 would have 
a direct impact on State governments. This provision would 
require federally chartered savings associations to convert to 
a national bank charter or a State depository institution 
charter, or to liquidate the institution. To the extent these 
1,200 institutions convert to a State charter, the costs of 
administering State banking laws would increase. CBO cannot 
predict how many will choose to become State chartered 
institutions, but we would expect that they would consider a 
number of factors, including regulatory costs, tax 
consequences, and issues affecting the various powers offered 
by the different Federal and State banking charters.
    According to the Conference of State Bank Supervisors 
[CSBS], there were approximately 32,000 financial institutions 
(including 12,400 banks, savings and loans, and credit unions) 
subject to regulation by the States in 1993. Based on 
information provided by CSBS, CBO estimates that states will 
spend approximately $300 million to regulate all of these 
institutions in fiscal year 1996. Even if all 1,200 of the 
institutions affected by this provision choose to convert to a 
State charter--which we think is unlikely--the cost increase to 
States should be less than $10 million a year. Furthermore, any 
increases would be offset by examination fees and annual 
assessments on assets.
    8. Estimate comparison: None.
    9. Previous CBO estimate: None.
    10. Estimate prepared by: Federal Cost Estimate: Deposit 
Insurance, RTC, and REFCORP--Mary Maginniss, Douglas Hamilton; 
FHA--Susanne Mehlman, Carla Pedone; Housing Subsidies--Brent 
Shipp, Carla Pedone; Federal Reserve--Mark Booth; State and 
Local Estimate--Marc Nicole.
    11. Estimate approved by: Robert A. Sunshine for Paul Van 
de Water, Assistant Director for Budget Analysis.

                      Committee Oversight Findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the committee reports 
that the findings and recommendations of the committee, based 
on oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incoroprated in the 
descriptive portions of this report.

         Committee on Government Reform and Oversight Findings

    No findings and recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI and clause 4(c)(2) of rule X of 
the Rules of the House of Representatives.
                    TITLE III--COMMITTEE ON COMMERCE

                          House of Representatives,
                                     Committee on Commerce,
                                   Washington, DC, October 6, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Mr. Chairman: I am transmitting herewith the 
recommendations of the Committee on Commerce for changes in 
laws within its jurisdiction, excluding recommendations for 
Medicare and Medicaid, pursuant to the provisions of section 
310 of the Congressional Budget Act of 1974 and section 
105(a)(2)(B)(iii) of House Concurrent Resolution 67, the 
Concurrent Resolution on the Budget--Fiscal Years 1996 to 2002. 
The committee's recommendations for Medicare and Medicaid will 
be transmitted to you separately.
    The enclosed recommendations were embodied in a series of 
committee prints adopted by the committee on September 13, 1995 
and September 19, 1995. Pursuant to your instructions, the 
legislative language of these committee prints has been 
incorporated into Title III as follows:
    Subtitle A: Communications; subtitle B: Nuclear Regulatory 
Commission Annual Charge; subtitle C: United States Enrichment 
Corporation; subtitle D: Waste Isolation Pilot Project; 
subtitle E: Naval Petroleum Reserves; and subtitle F: 
Department of Commerce Abolition. Also enclosed is the 
accompanying report language and a Ramseyer submission.
    Regrettably, as of this date, the committee has not yet 
received the official cost estimate for Title III from the 
Congressional Budget Office. Despite this fact, the Commerce 
Committee does not wish to delay your committee's consideration 
of the fiscal year 1996 Omnibus Budget Reconciliation Act. I 
am, therefore, transmitting the committee's recommendations at 
this time with the understanding that the Commerce Committee 
will be permitted to submit additional material with respect to 
the cost estimate if warranted after the Congressional Budget 
Office transmits their cost estimate.
    If you have any questions concerning the committee's 
recommendations, or if I can be of any further assistance to 
you as you proceed with the committee's deliberations, please 
do not hesitate to contact me.
            Sincerely,
                                     Thomas J. Bliley, Jr.,
                                                          Chairman.
    Enclosures.

    [Editor's note: References to subtitle F in the transmittal 
letter and report language submitted by the Committee on 
Commerce apply to title XVII in this document, the Department 
of Commerce Abolition.]

                           table of contents

                                                                   Page
Transmittal letter...............................................   221
Subtitle A--Communications.......................................   223
    Purpose and summary..........................................   223
    Background and need for legislation..........................   223
    Hearings.....................................................   225
    Committee consideration......................................   225
    Rollcall votes...............................................   226
    Committee oversight findings.................................   227
    Committee on Government Reform and Oversight findings........   227
    Committee cost estimate......................................   227
    Congressional Budget Office estimate.........................   227
    Inflationary impact statement................................   228
    Section-by-section analysis..................................   228
    Changes in existing law......................................   239
Subtitle B--Nuclear Regulatory Commission annual charge..........   239
    Purpose and summary..........................................   239
    Background and need for legislation..........................   239
    Hearings.....................................................   241
    Committee consideration......................................   241
    Rollcall votes...............................................   241
    Committee oversight findings.................................   242
    Committee on Government Reform and Oversight findings........   242
    Committee cost estimate......................................   242
    Congressional Budget Office estimate.........................   243
    Inflationary impact statement................................   243
    Section-by-section analysis..................................   243
    Changes in existing law......................................   243
Subtitle C--United States Enrichment Corporation.................   243
    Purpose and summary..........................................   243
    Background and need for legislation..........................   243
    Hearings.....................................................   244
    Committee consideration......................................   244
    Rollcall votes...............................................   245
    Committee oversight findings.................................   246
    Committee on Government Reform and Oversight findings........   246
    Committee cost estimate......................................   246
    Congressional Budget Office estimate.........................   246
    Inflationary impact statement................................   246
    Section-by-section analysis..................................   246
    Changes in existing law......................................   253
Subtitle D--Waste isolation pilot plant..........................   253
    Purpose and summary..........................................   253
    Background and need for legislation..........................   253
    Hearings.....................................................   256
    Committee consideration......................................   256
    Rollcall votes...............................................   257
    Committee oversight findings.................................   259
    Committee on Government Reform and Oversight findings........   259
    Committee cost estimate......................................   259
    Congressional Budget Office estimate.........................   259
    Inflationary impact statement................................   259
    Section-by-section analysis..................................   259
    Changes in existing law......................................   261
Subtitle E--Naval Petroleum Reserves.............................   261
    Purpose and summary..........................................   261
    Background and need for legislation..........................   261
    Hearings.....................................................   263
    Committee consideration......................................   263
    Rollcall votes...............................................   263
    Committee oversight findings.................................   266
    Committee on Government Reform and Oversight findings........   266
    Committee cost estimate......................................   266
    Congressional Budget Office estimate.........................   266
    Inflationary impact statement................................   267
    Section-by-section analysis..................................   267
    Changes in existing law......................................   268

                       Subtitle A--Communications

                          Purpose and Summary

    Chapter 1 of Subtitle A extends the authority (through 
fiscal year 2002) and expands the scope for which the Federal 
Communications Commission [FCC] may use the competitive bidding 
process (spectrum auctions) for the awarding of licenses. It 
continues the requirement that licenses be for mutually 
exclusive applications. Further, it exempts from these 
requirements licenses or construction permits by public safety 
radio services and initial licenses or construction permits for 
advanced television [ATV].
    Chapter 1 also requires the FCC to complete all actions 
necessary to permit the assignment of licenses by September 30, 
2002, of 100 megahertz [MHz] of spectrum located below 3 
gigahertz not previously designated for auction or for 
reallocation by the National Telecommunications and Information 
Administration [NTIA]. If the FCC cannot provide for effective 
relocation of incumbent licensees, it is required to notify the 
NTIA of suitable government spectrum needed for relocating 
current license holders. The NTIA would be required to identify 
spectrum allocated to the Federal government for reallocation 
to meet the commercial relocation needs.
    Further, Chapter 1 requires the NTIA to identify and 
designate for reallocation to the FCC a single frequency band 
of 20 megahertz of spectrum under 3 gigahertz. The FCC is 
required then to schedule an auction for this reallocated 
spectrum within one year.
    Chapter 2 of Subtitle A amends the Communications Act of 
1934 to authorize appropriations for the FCC and for other 
purposes. This Chapter authorizes an appropriation of 
$186,000,000 for fiscal year 1996, with additional sums as may 
be required for necessary nondiscretionary cost increases. In 
addition, it authorizes the Commission to expand licensing fees 
from telecommunications entities in order to cover the costs of 
certain regulatory activities. The legislation also clarifies 
certain provisions of the Communications Act of 1934 (the 
Communications Act) and the Commission's authority under the 
Act.

                  Background and Need for Legislation

                      Chapter 1--Spectrum Auctions

Management of the spectrum

    The radio spectrum is the portion of the electromagnetic 
spectrum used specifically for wireless communications, 
commonly ranging between 10 kilohertz and 300,000 megahertz. 
The use of a frequency at a given location usually precludes 
the use of that frequency, and perhaps certain surrounding 
frequency, from being used by others in the same geographic 
area.
    Federal coordination and management of the radio spectrum 
in the United States, and the granting of exclusive and non-
exclusive licenses for its use, are divided between the Federal 
Communications Commission [FCC] and the President. The 
Communications Act of 1934 provides the authority to assign 
radio frequencies to the FCC except for those radio stations 
belonging to the Federal Government. Specifically, section 301 
of the Communications Act designates that one of the general 
purposes of the Act is to ``maintain the control of the United 
States, over all the channels of radio transmission; and to 
provide for the use of such channels, but not the ownership 
thereof, by persons for limited periods of time, under licenses 
granted by Federal authority, and no such license shall be 
construed to create any right, beyond the terms, conditions, 
and the periods of the license.''
    Section 305 assigns the President the authority to assign 
frequencies for Federal Government stations. Section 
103(b)(1)(A) of the National Telecommunications and Information 
Administration Organization Act, as authorized by Public Law 
102-538, designates the Assistant Secretary for Communications 
and Information with the Department of Commerce, also known as 
the Administrator of the National Telecommunications and 
Information Administration [NTIA], with the authority delegated 
to the President to assign frequencies to radio stations or 
classes of stations owned and operated by the U.S. Government. 
The NTIA is obligated to establish policies concerning the 
allocation, allotment, and assignment of spectrum for Federal 
use. The NTIA utilizes the Indepartmental Radio Advisory 
Committee [IRAC] to establish priorities and encourage 
efficient spectrum use by Federal Government users.

Spectrum auctions

    The Omnibus Budget Reconciliation Act of 1993 [OBRA 93] 
required the Commerce Department [NTIA] to identify 200 
megahertz [MHz] of radio spectrum currently used by the Federal 
Government for reallocation to the private sector. In February 
1994, the NTIA released its Preliminary Spectrum Reallocation 
Report identifying 50 MGz for immediate reallocation and 
proposed 150 MHz for later reallocation. In February of this 
year, the NTIA released its Spectrum Allocation Final Report to 
conclude the identification process. Furthermore, the 1993 Act 
authorized the FCC to auction rights to portions of spectrum 
for certain services. The Commission's use of the auction is 
limited to situations where there are mutually exclusive 
applications for an initial license and the service is to be 
offered as a subscription service. Thus, licenses for free, 
over-the-air broadcast remain exempt. The competitive bidding 
process is intended to promote the rapid development of new 
technologies, products and services to be made available to the 
public.
    Since 1993, the FCC has conducted four spectrum auctions: 
two for narrowband Personal Communications Services [PCS] 
licenses; one for Interactive Video and Data Service [IVDS] 
licenses; and one for broadband PCS licenses. The four auctions 
have produced a total of almost $9 billion for the general fund 
of the U.S. Treasury. The nationwide narrowband PCS auction 
that was completed in July 1994 generated $617 million. A 
subsequent regional narrowband auction raised $395 million. The 
IVDS auction raised $214 million. The auction of broadband PCS 
spectrum yielded commitments for receipts totaling $7.1 
billion.
    The FCC's competitive bidding authority, as authorized by 
OBRA 93, lasts for 5 years and will expire at the end of fiscal 
year 1998. Because of the success of the auction process, in 
March 1995, the committee approved H.R. 1218, which extended 
the FCC's auction authority for an additional 2 years through 
the end of fiscal year 2000. H.R. 1218 was ordered reported by 
the full committee on March 15, 1995, and reported to the House 
on March 23, 1995 (H. Rept. 104-88).
    The committee finds that the success of the past spectrum 
auction plans warrants their extension and broadening of scope 
until 2002. The revenue generated by the extension will provide 
a badly needed source of income for the Federal Government and, 
more importantly, will continue the process of efficient 
licensing of the radio spectrum. As significantly, extending 
and broadening the competitive bidding process will continue to 
advance the goal of increasing the rapid deployment of new 
technologies and services for consumers.

       Chapter 2--Federal Communications Commission Authorization

    The Federal Communications Commission was established with 
the passage of the Communication Act of 1934 as an independent 
agency charged with regulating interstate and foreign 
communications by means of radio, television, wire, cable, and 
satellite. The committee is responsible for overseeing and 
authorizing the Commission to ensure efficient implementation 
of communications policy and the proper and orderly execution 
of congressional mandates.
    The Commission received an appropriation of $185,200,000 
for fiscal year 1995; Chapter 2 authorizes an appropriation 
level of $186 million for fiscal year 1996.

                                Hearings

    On Tuesday, September 7, 1995, the Subcommittee on 
Telecommunications and Finance held an oversight hearing on the 
Federal management of the radio spectrum. Testifying before the 
subcommittee was one panel of witnesses as follows: The 
Honorable Larry Irving, Assistant Secretary of Commerce for 
Communications and Information, Department of Commerce; Mr. 
James Gattuso, vice president for policy development, Citizens 
for a Sound Economy; Mr. Dale Hatfield, CEO Hatfield 
Associates, Inc.; and Dr. Charles L. Jackson, principal, 
Strategic Policy Research, Inc.
    The Subcommittee on Telecommunications and Finance held a 
hearing on H.R. 1869, a bill identical to chapter 2 of subtitle 
A, on June 19, 1995. Testimony was received from FCC Chairman 
Reed E. Hundt, Commissioners James H. Quello, Andrew C. 
Barrett, Rachelle B. Chong, and Susan Ness.

                        Committee Consideration

                      Chapter 1--Spectrum Auctions

    On September 13, 1995, the committee met in open session 
and ordered chapter 1 of subtitle A, as amended, transmitted to 
the House Committee on the Budget for inclusion in the fiscal 
year 1996 Omnibus Budget Reconciliation Act, by a voice vote, a 
quorum being present.

       Chapter 2--Federal Communications Commission Authorization

    On September 13, 1995, the committee met in open session 
and ordered chapter 2 of subtitle A, as amended, transmitted to 
the House Committee on the Budget for inclusion in the fiscal 
year 1996 Omnibus Budget Reconciliation Act, by a voice vote, a 
quorum being present.

                             Rollcall Votes

    Clause 2(l)(2)(B) of rule XI of the Rules of the House of 
Representatives, requires the committee to list the recorded 
votes on the motion to report and on amendments thereto. There 
were no recorded votes taken in connection with ordering either 
chapter 1 of subtitle A or chapter 2 of subtitle A transmitted 
or in adopting amendments to either chapter. The voice votes 
taken in committee, as well as the quorum call taken on 
September 13, 1995, are as follows:

                          ROLLCALL VOTE No. 62

    Bill: Committee print entitled ``Communications: Spectrum 
Auctions'' and committee print entitled ``Communications: 
Federal Communications Commission Authorization.''
    Quorum call: 26 members answered present.

--------------------------------------------------------------------------------------------------------------------------------------------------------
              Representative                           Yeas                Nays     Present          Representative          Yeas      Nays     Present 
--------------------------------------------------------------------------------------------------------------------------------------------------------
Mr. Bliley...............................  ............................  ........         X   Mr. Dingell................  ........  ........         X 
Mr. Moorhead.............................  ............................  ........         X   Mr. Waxman.................  ........  ........  .........
Mr. Tauzin...............................  ............................  ........         X   Mr. Markey.................  ........  ........         X 
Mr. Fields...............................  ............................  ........  .........  Mr. Wyden..................  ........  ........  .........
Mr. Oxley................................  ............................  ........         X   Mr. Hall...................  ........  ........  .........
Mr. Bilirakis............................  ............................  ........         X   Mr. Bryant.................  ........  ........  .........
Mr. Schaefer.............................  ............................  ........         X   Mr. Boucher................  ........  ........  .........
Mr. Barton...............................  ............................  ........  .........  Mr. Manton.................  ........  ........  .........
Mr. Hastert..............................  ............................  ........         X   Mr. Towns..................  ........  ........  .........
Mr. Upton................................  ............................  ........  .........  Mr. Studds.................  ........  ........  .........
Mr. Stearns..............................  ............................  ........         X   Mr. Pallone................  ........  ........         X 
Mr. Paxon................................  ............................  ........  .........  Mr. Brown..................  ........  ........         X 
Mr. Gillmor..............................  ............................  ........  .........  Mrs. Lincoln...............  ........  ........         X 
Mr. Klug.................................  ............................  ........         X   Mr. Gordon.................  ........  ........  .........
Mr. Franks...............................  ............................  ........         X   Ms. Furse..................  ........  ........         X 
Mr. Greenwood............................  ............................  ........  .........  Mr. Deutsch................  ........  ........  .........
Mr. Crapo................................  ............................  ........  .........  Mr. Rush...................  ........  ........         X 
Mr. Cox..................................  ............................  ........  .........  Ms. Eshoo..................  ........  ........         X 
Mr. Deal.................................  ............................  ........  .........  Mr. Klink..................  ........  ........         X 
Mr. Burr.................................  ............................  ........         X   Mr. Stupak.................  ........  ........         X 
Mr. Bilbray..............................  ............................  ........         X                                                             
Mr. Whitfield............................  ............................  ........         X                                                             
Mr. Ganske...............................  ............................  ........         X                                                             
Mr. Frisa................................  ............................  ........         X                                                             
Mr. Norwood..............................  ............................  ........  .........                                                            
Mr. White................................  ............................  ........  .........                                                            
Mr. Coburn...............................  ............................  ........         X                                                             
--------------------------------------------------------------------------------------------------------------------------------------------------------

           Committee on Commerce--104th Congress--Voice Votes

                         SUBTITLE A--CHAPTER 1

    Bill: Committee print entitled ``Communications: Spectrum 
Auctions''.
    Amendment: Amendment by Mr. Hall re: timetable for 
relocation of incumbents.
    Disposition: Agreed to, by a voice vote.
    Amendment: Amendment by Mr. Fields re: technical 
corrections pertaining to scoring.
    Disposition: Agreed to, by a voice vote.
    Amendment: Amendment by Mr. Fields re: additional 
government spectrum.
    Disposition: Agreed to, by a voice vote.
    Motion: Motion by Mr. Bliley to order the committee print 
entitled ``Communications: Spectrum Auctions,'' amended, 
transmitted to the Committee on the Budget for inclusion in the 
fiscal year 1996 Omnibus Budget Reconciliation Act.
    Disposition: Agreed to, by a voice vote.

                         SUBTITLE A--CHAPTER 2

    Bill: Committee print entitled ``Communications: Federal 
Communications Commission Authorization''.
    Amendment: Amendment by Mr. Stupak re: timetable for 
relocation of incumbents.
    Disposition: Agreed to, by a voice vote.
    Motion: Motion by Mr. Moorhead to order the committee print 
entitled ``Communications: Federal Communications Commission 
Authorization'', as amended, transmitted to the Committee on 
the Budget for inclusion in the fiscal year 1996 Omnibus Budget 
Reconciliation Act.
    Disposition: Agreed to, by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Subcommittee on 
Telecommunications and Finance held oversight and legislative 
hearings and made findings that are reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the committee by the Committee on Government 
Reform and Oversight.

                        Committee Cost Estimate

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the committee believes that 
cumulative effect of enacting of chapters 1 and 2 would result 
in no additional costs to the Federal Government.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, a letter from the Congressional 
Budget Office providing a cost estimate for all six subtitles 
of title III is found at the conclusion of title XVII of this 
bill.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee finds the chapters 1 
and 2 of subtitle A would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

                      Chapter 1--Spectrum Auctions

Sec. 3001. Spectrum auctions

            (a) Extension and expansion of authority to use competitive 
                    bidding
    This subsection amends section 309(j) of the Communications 
Act which grants the FCC authority to use a system of 
competitive bidding as a means of granting licenses. The 
subsection provides that such authority will apply when there 
are mutually exclusive applications for an initial license for 
an exclusive use of the electromagnetic spectrum. Competitive 
bidding would not be permitted to be used for unlicensed uses. 
The FCC is required to continue its obligation under section 
309(j)(6)(E) to take actions necessary to avoid situations of 
mutual exclusivity. An example is the 450-470 MHz band, which 
is shared by low-powered medical telemetry devices.
    The subsection also sets forth specific exemptions from the 
use of competitive bidding. The subsection does not permit the 
use of competitive bidding for public safety radio services, 
including nongovernment uses that protect the safety of life, 
health, and property and that are not made commercially 
available to the public. The committee intends that this 
exemption includes spectrum available for internal, 
noncommercial radio services used by State of local 
governmental entities or by nongovernmental entities, such as 
utility, pipeline, petroleum, railroad services under Federal, 
State, or local laws or regulations, or other codes or 
standards relating to public health, safety, or security.
    Under this subsection, the FCC may not use competitive 
bidding for initial licenses for broadcast digital television 
services assigned by the FCC to incumbent broadcast licenses to 
replace their current analog signal.
    This subsection also repeals the authority of the FCC to 
use random selection (or so-called lotteries) as an alternative 
to competitive bidding.
    Finally, the expansion of competitive bidding authority 
under this subsection does not apply to any licenses for which 
the FCC has accepted mutually exclusive applications prior to 
the date of enactment. Nonetheless, this prohibition is not 
intended by the committee to limit or inhibit in any way the 
FCC's ability to exercise its current authority under the act 
to determine how best to award licenses for applications 
previously received.
            (b) Commission obligation to make additional spectrum 
                    available through competitive bidding
    This subsection directs the FCC to auction 100 megahertz 
[MHz] of spectrum located below 3 gigahertz [GHz] by September 
30, 2002, which prior to the date of enactment, have not been 
designated by the FCC for assignment by auction and have not 
been identified by the NTIA as reallocable frequencies. The FCC 
must auction the licenses for the use of bands of frequencies 
in blocks of at least 25 MHz unless the FCC determines that a 
combination of smaller bands can reasonably be expected to 
produce greater receipts for the U.S. Treasury.
    In making available such bands of frequencies for 
competitive bidding under this subsection, the FCC must 
consider, first and foremost, the promotion of the most 
efficient use of the spectrum. The FCC must also consider the 
cost to incumbent licenses of relocating existing uses to other 
bands of frequencies or other means of communication. Further, 
the committee remains committed to protecting public safety 
users from adverse effects of competitive bidding, and directs 
the FCC to take into account the needs of public safety users 
when making allocations decisions. Finally, in making bands of 
frequencies available for auction, the FCC must ensure that 
such assignments comply with the requirements of international 
agreements concerning spectrum allocations.
    In making available bands of frequencies for competitive 
bidding pursuant to this section, if the FCC is unable to 
provide for the effective relocation of incumbent licenses, it 
shall notify the NTIA that it has identified bands of 
frequencies suitable for relocation and which could be 
reallocated for private use.
            (c) Identification and reallocation of frequencies
    In response to such a notice from the Commission, the NTIA 
shall prepare and submit a report to the President and Congress 
identifying and recommending for reallocation frequencies that 
are assigned to the Federal Government stations and are not 
required for the present or identifiable future needs of the 
Federal Government and that are suitable for the uses 
identified in the Commission's notice.
            (d) Completion of C-block auction
    This subsection directs the FCC to commence the Broadband 
Personal Communications Services [PCS] C-block auction not 
later than December 4, 1995. The C-block spectrum for PCS is 
anticipated to be the third stage in the PCS auction process. 
The committee is concerned that this auction may be compromised 
because of a series of delays in involving challenges to the 
implementation of the FCC's rules governing this auction. In 
this regard, on September 28, 1995, a Federal appeals court in 
Washington, DC dissolved the stay on the auction and allowed it 
to go forward. The committee believes that further significant 
delay of this auction will result in a competitive disadvantage 
to the winner of the C-block licenses since the A- and B-block 
licenses have previously been awarded. It is the committee's 
intent that this auction be held expeditiously not only to 
prevent erosion of the value of the spectrum but to promote 
greater competition in the existing wireless marketplace. This 
subsection provides that the FCC's competitive bidding rules 
set forth in its Sixth Report and Order in Docket 93-253 will 
govern the auction and that these rules be deemed final.
            (e) Modification of auction policy to preserve auction 
                    value of spectrum
    This subsection directs that the voluntary negotiation 
period for relocating fixed microwave licenses to frequency 
bands not allocated for licensed emerging technology services, 
such as PCS, will expire within 1 year after the date of FCC 
acceptance of applications for such services. The mandatory 
negotiation period for relocating fixed microwave licenses will 
expire 2 years from the acceptance of applications. The purpose 
of this subsection is to expedite the relocation of incumbent 
licenses so that emerging technology services such as PCS may 
become operational as soon as possible.
            (f) Identification and reallocation of auctionable 
                    frequencies
    This subsection requires the NTIA to submit a second 
reallocation report to Congress, identifying and recommending 
for reallocation a single frequency band of at least 20 MHz, 
located below 3 GHz, and which meets the criteria of section 
113(a) of the National Telecommunications and Information 
Administration Organization Act. Within 1 year after receipt of 
the second reallocation report, the FCC shall submit a plan to 
the President and Congress, and implement such plan for the 
allocation and assignment of such frequencies in accordance 
with section 309(j) of the Communications Act of 1934.

       Chapter 2--Federal Communications Commission Authorization

Sec. 3011. Short title

    Section 3011 designates the title of chapter 2 as the 
Federal Communications Commission Authorization Act of 1995.

Sec. 3012. Extension of authority

            (a) Authorization of appropriation
    Section 3012(a) authorizes an appropriation for the Federal 
Communications Commission [FCC] of $186 million for fiscal year 
1996.
            (b) Travel reimbursement program
    Subsection (b) deletes the FCC's specific travel 
reimbursement authority codified at section 4(g)(2) of the 
Communications Act. This authority has been superseded by the 
generic, Governmentwide provisions of 31 U.S.C. 1353, the 
Ethics Reform Act of 1989. Since Congress has authorized such 
Governmentwide reimbursement authority, to retain a different 
program solely for the FCC would subject the agency to 
conflicting requirements.
            (c) Communications support for older Americans
    Subsection (c) extends the authorization for the FCC to 
make grants to, or enter into cooperative agreements with, 
private, nonprofit organizations to utilize the voluntary 
services of older Americans. While this authority was included 
in the FCC Authorization Act of 1990, the FCC was only able to 
begin testing the program in fiscal year 1991, once the program 
was reauthorized. Funding constraints in fiscal year 1993 
precluded the use of the program that year. The FCC was not 
authorized to utilize the program in fiscal year 1994. 
Therefore, extending the program through fiscal year 1996 will 
enable the FCC to assess the benefits of the program more 
thoroughly.

Section 3013. Application fees

            (a) Adjustment of application fee schedule
    Section 3013(a) amends section 8(b) of the Communications 
Act to authorize the FCC to:
          (1) Modify its application fees to include an 
        allocation of the legal and executive costs associated 
        with supporting the FCC's application processing 
        activities;
          (2) add, delete, or modify application fee service 
        classifications;
          (3) continue to collect fees at the prior year's 
        rates until the effective date of a revised fee 
        schedule; and
          (4) retain application fees collected in excess of an 
        amount to be sent to the general fund of the U.S. 
        Treasury.
    This section authorizes the FCC to modify its schedule of 
fees for application processing so that the estimated total 
collection does not exceed the costs associated with its 
authorization of service activities. For the first item, the 
FCC may include in its associated costs an allocation of the 
legal services and executive direction and support costs 
incurred in support of its application processing activities. 
Providing the FCC with this authority will result in fee 
collections that more accurately reflect the cost to the 
Commission of administering its authorization of service 
activities.
    The new sections 8(b)(4) and 8(b)(5) authorize the FCC to 
add, delete, or reclassify fee service categories and establish 
the fee amounts for these modifications consistent with the 
cost allocation methodology noted above. This authority would 
enable the FCC to make adjustments to its service 
classifications in order to respond quickly to the often rapid 
change in the communications industry.
    The new section 8(b)(3) authorizes the FCC to continue to 
collect application fees at the previous year's rates until a 
new application fee schedule is adopted by the FCC and becomes 
effective. Without this provision, the FCC could lose several 
months of fee revenues from fee payers.
            (b) Treatment of additional collections
    Subsection (b) amends section 8(e) of the Communications 
Act to require the FCC to deposit $40,000,000 in application 
fees to the general fund of the U.S. Treasury, with any 
additional amount collected to be deposited as an offsetting 
collection in, and credited to, the account providing 
appropriations to fund the FCC. This provision authorizes the 
FCC to recover the costs of legal services and executive 
direction and support allocated to the authorization of service 
programs and to retain any new application fee revenues in 
excess of $40,000,000.
            (c) Schedule of application fees for PCS
    Subsection (c) amends section 8(g) of the Communications 
Act to establish the FCC's authority to charge fees for the 
licensing and regulation of Personal Communications Services 
[PCS]. This new schedule of PCS fees is consistent with fees 
authorized by Congress for other wireless services.
            (d) Vanity call signs
    Subsection (d) adds to section 8(g) of the Communications 
Act language which proposes a one-time $150 lifetime fee for 
persons interested in obtaining an amateur radio vanity call 
sign. The section also:
          (1) Provides that money received from these fees 
        shall be deposited as an offsetting collection in, and 
        credited to, the account providing appropriations to 
        the FCC; and
          (2) deletes the current annual regulatory user fee of 
        $7 for amateur vanity call signs.

Sec. 3014. Regulatory fees

            (a) Executive and legal costs
    Section 3014(a) amends section 9 of the Communications Act 
by authorizing the FCC to allocate and recover the legal 
services and executive direction and support costs it incurs in 
the discharge of its enforcement, policy and rulemaking, user 
information services, and international activities. This 
provision is similar to the amendment in section 8(b) modifying 
application processing fees. Its adoption will help to ensure 
that the regulatory fee collections more accurately reflect the 
costs of the FCC of administering these activities.
            (b) Establishment and adjustment
    Subsection (b) authorizes the FCC to continue to collect 
regulatory fees at the prior year's rates until the effective 
date of a new fee schedule. Again, without this provision, the 
FCC could lose several months of revenues from fee payers.
    This section further requires the FCC to notify the 
Congress of any changes to the regulatory fee schedule at least 
45 days prior to the effective date of the change. This 
revision will help to ensure that Congress is notified in a 
timely manner of proposed changes to the fee schedule.
            (c) Regulatory fees for satellite TV operations
    Subsection (c) amends section 9 of the Communications Act 
to reduce to $500 the regulatory fees now imposed under section 
9 on satellite TV licenses from a current range of $4,000-
$18,000, depending on market size and VHF or UHF status. 
Although the FCC needs the resources to regulate these so-
called ``satellite stations'', the committee finds that it 
would not be in the public interest to impose the full 
regulatory fee on the approximately 130 satellite stations, 
most of which serve less populated areas of the country.
            (d) Governmental entities paying section 9 fees
    Subsection (d) amends section 9(h) of the Communications 
Act to repeal the current exemption from regulatory fees for 
governmental entities that also provide competitive, commercial 
services. The committee intends that fees not be assessed 
against State or local governments for communications 
associated with public services provided by government 
entities, such as police and fire protection, ambulance 
dispatch, or highway maintenance. In addition, the exemption 
from regulatory fees applies to instances where a State, 
territory, municipality, or similar political entity or subpart 
thereof it the sole provider of commercial services.
    However, the exemption from regulatory fees does not apply 
where a Government entity provides commercial communications 
services in competition with one or more nongovernmental 
providers. Simple equity requires that when a Government entity 
is engaged in competition with a nongovernmental entity for the 
provision of a service, both competitors should be subject to 
the payment of regulatory fees.
            (e) Information required in connection with adjustment of 
                    regulatory fees
    Subsection (e) adds a new section 10 to the Communications 
Act entitled ``Accounting System and Adjustment Information.'' 
This section will require the FCC to develop a cost accounting 
system and tighter budget planning for the allocation of the 
costs of its application and regulatory fee programs and for 
any fee adjustments.
    The committee adopted this provision as a precaution 
against excessive spending by the FCC as a result of the 
adoption of section 9 of the Communications Act in August 1993. 
The enactment of section 9 has resulted in the establishment of 
a fee program which permits the FCC to be funded by those it 
regulates up to a level stipulated by appropriations acts.
    This subsection provides that when the FCC adjusts the fee 
schedule (pursuant to the requirements of appropriations), 
those revisions are not subject to judicial review. It is thus 
critically important that Congress, the public, and the 
industries that ultimately will have to pay the fees, have 
access to the justification that underlie budget requests early 
in the budget process.
    Section 3014(e) of chapter 2 in effect requires the FCC to 
adopt a regulatory budget, and provide the Congress and the 
public with a justification of its budget request in a format 
that will help to illuminate the increased fees that will 
result and a rationale for spreading those fees over the 
affected industries.
    The format requires the FCC to submit its request no later 
than May 1 of each calendar year. The submission is required to 
be broken down according to the following activities:
    Authorization of service.--This category includes the 
authorization or licensing of radio stations, 
telecommunications equipment, and radio operators. This 
activity group also includes the authorization of common 
carrier services and facilities.
    Policy and rulemaking.--This category encompasses formal 
inquiries, rulemaking proceedings to establish or amend the 
FCC's rules and regulations, action on petitions for 
rulemaking, and requests for rule interpretations or waivers; 
economic studies and analyses; and spectrum planning, modeling, 
propagation-interference analyses and allocation.
    Enforcement.--This category covers enforcement of the FCC's 
rules, regulations, and authorizations, including 
investigations, inspections, compliance monitoring, and 
sanctions of all types. This function also includes the receipt 
and disposition of formal and informal complaints regarding 
common carrier rates and services, the review and acceptance/
rejection of carrier tariffs, and the review, prescription and 
audit of carrier accounting practices.
    User information services.--This category includes the 
publication and dissemination of FCC decisions and actions, and 
related activities; public reference and library services, the 
duplication and dissemination of FCC records and data bases; 
the receipt and disposition of public inquiries; consumer, 
small business, and public assistance; and public affairs and 
media relations.
    International.--This category covers the preparation for 
and participation in international, regional and bilateral 
conferences, meetings, and negotiations; and administration of 
FCC responsibilities under international radio regulations and 
other treaties, conventions, and agreements. This function also 
includes activities associated with international frequency 
coordination and notification.
    Legal services.--This category includes legal review and 
support services regarding matters of administrative law, 
litigation, and adjudications. This activity group also 
includes the Office of General Counsel, Office of 
Administrative Law Judges, and the Review Board.
    Executive direction and support.--This category encompasses 
overall policy direction, program development, and executive 
direction as provided by the Chairman and staff, Commissioners 
and their staffs, and by the managing director. This function 
also includes support services such as management planning, 
budgeting and financial management, personnel resource 
management, information resources management and ADP 
operations, security, and administrative and office services. 
Also associated with this function are the activities of the 
Office of Legislative Affairs and the Office of Inspector 
General.
    For each activity, the Commission is required to further 
allocate its request among its various bureaus, divisions, and 
offices.
    It is the committee's hope that the discipline imposed by 
the enactment of this section will result in an increased 
awareness of the impact of increases in the Commission's budget 
on those who will bear the burden of paying for those 
increases. This information will also assist the committee in 
its oversight of the FCC's activities, and provide greater 
public accountability for the Commission as well.
    It is the committee's intention to scrutinize the FCC's 
future budget closely. The committee is prepared in the future 
to place a cap on section 9 fees if it is apparent that the FCC 
is requesting excessive budget increases.

Sec. 3015. Inspection of ship radio stations

    This section amends sections 4(f)(3), 362(b) and 385 of the 
Communications Act of 1934 to authorize ship inspections by 
entities other than the FCC, and grants the FCC more 
flexibility in inspection requirements.
    The Communications Act of 1934 requires the FCC to conduct 
inspections of ship radio equipment and apparatus required to 
be carried aboard ship to ensure compliance with part II of 
title III of the Communications Act and the Great Lakes 
Agreement. The section will afford increased flexibility and 
efficiency for both ship owners and the FCC by authorizing the 
FCC to use designated entities, such as the American Bureau of 
Shipping, to conduct inspections on a case-by-case basis. This 
flexibility will be particularly useful for vessels operating 
in remote areas only on a periodic basis. In addition, the 
amendments will give the FCC greater flexibility in determining 
which inspections may be necessary to ensure compliance with 
the requirements in part II.
    Section 362(b) requires that ships subject to part II must 
have their radio installation inspected at least once every 
year by the FCC. These amendments extend the FCC's authority to 
grant a waiver of the annual inspection of a ship's radio 
installation to ships travelling from one U.S. port to another 
or operating in remote ports when the FCC inspectors are not 
able to inspect the vessel from 30 days to 90 days. The 
amendment also allows the FCC to waive the annual inspection 
entirely for a U.S. vessel that operates in waters outside U.S. 
jurisdiction, if the vessel complies with the international 
Safety Convention. Currently, U.S. vessels that operate in 
foreign trade and comply with the Safety Convention 
requirements for radio equipment but do not return to the 
United States within 12 months are unable to obtain the annual 
inspection required under the existing section of the act.

Sec. 3016. Expedited ITFS processing

    Section 3016 amends section 5(c)(1) of the Communications 
Act to allow the FCC to delegate to its processing staff 
authority to act on routine cases involving authorizations of 
the Instructional Television Fixed Service [ITFS], a microwave 
video service which provides instructional programming to 
schools and colleges. Many ITFS stations also lease excess 
capacity on their system to wireless cable operations. Wireless 
cable operations, in turn, compete with traditional cable 
systems in the delivery of video programming to the public. 
Where more than one educational institution applies for an ITFS 
station, the FCC conducts a paper hearing to decide the winner. 
Winners are chosen based upon an objective point system. The 
determinations required to resolve cases typically involve 
routine, uncontroverted factual matters. The amendment will 
authorize FCC proceeding staff to act on these routine cases.
    The committee believe that this amendment will 
substantially speed ITFS processing, thus speeding the offering 
of instructional services to schools and colleges, and speeding 
competition by wireless cable operators to cable systems. 
Moreover, the applicants will still be able to seek FCC review 
of staff actions in such cases.

Sec. 3017. Tariff rejection authority

    Section 3017 amends section 203(d) of the Communications 
Act to clarify in four respects the FCC's tariff rejection 
authority. First, the provision makes explicit the FCC's 
authority to reject a tariff that is patently unlawful on its 
face. The courts have recognized that the FCC has implicit 
authority to reject a tariff filing if it finds it is patently 
unlawful on its face. See Associated Press v. FCC, 448 F.2d 
1095, 1103 (D.C. Cir. 1971). This rejection authority, however, 
has never been expressly codified in the Communications Act 
except to the extent that section 203(d) of the Communications 
Act permits the FCC to reject a tariff filing for failure to 
give lawful notice of its effective date.
    Second, this section provides that in deciding whether to 
reject a tariff filing as patently unlawful, the FCC must 
presume that the facts alleged by the carrier are true. The FCC 
would thus be required to decide whether the tariff was lawful 
as a matter of law, rather than relying on contested facts. 
This procedure is similar to the procedures and methods on 
analysis employed by Federal courts in ruling on motions for 
summary judgment.
    Third, the amendment clarifies that the FCC may consider 
information that an interested party or the carrier may present 
to the FCC. FCC consideration of additional material increases 
administrative efficiency by permitting the agency to avoid a 
full investigation of the tariff when it is unnecessary to 
determine the lawfulness of the tariff.
    Fourth, the amendment makes explicit the FCC's authority to 
reject a tariff filling either in its entirety or in part. 
Clarifying this aspect of the FCC's authority will permit 
beneficial and lawful parts of proposed tariff filings to take 
effect, even if the proposed tariff filing contains unlawful 
portions.

Sec. 3018. Refund authority

    Section 3018 amends section 220(d) of the Communications 
Act to clarify the FCC's authority to make refunds to redress 
certain common carrier rule violations. The committee believes 
this language is necessary to make certain that its rules on 
cost allocation and other matters are followed, and where they 
are not followed the committee believes the FCC must have 
complete and full authority to order refunds: First, in order 
to make consumers whole, and second, to fully enforce the FCC's 
rules and regulations.

Sec. 3019. Licensing of aviation and maritime services by rule

    This section amends section 307(e) of the Communications 
Act to authorize the FCC to issue blanket licenses by rule for 
radio equipment on airplanes and ships.
    Section 301 of the Communication Act specifies, among other 
things, that the use or operation of radio equipment on ships 
and aircraft of the United States must be authorized by the 
grant of a radio station license. Similarly, the international 
radio regulations require licenses for vessel and aircraft 
radio stations when operated on international voyages or 
flights. Currently, the FCC routinely grants, upon request and 
with some exceptions, an individual aircraft or ship station 
license to any person who properly completes an application. 
For domestic operations, and individual license is not needed 
and would be a burden on both applicants and the FCC.
    This amendment would permit the FCC to authorize the 
operation of radio equipment on ships and aircraft that operate 
only domestically. In the case of aircraft, the FCC's work is 
redundant with that of the Federal Aviation Administration 
[FAA]. The FAA assigns each aircraft an identification number 
which then becomes that FCC's call sign. In the case of 
vessels, call sighs are not necessary, as vessel names are used 
in some cases for identification and could be used generally 
for domestic operations. In addition, the licenses grant no 
exclusive rights to channels. All channels are shared by all 
licensees, so spectrum management occurs through channel 
sharing, in real time, or through control exercised generally 
by FAA or Coast Guard stations. Aircraft and ship radio 
stations would still be subject to the FCC's rules and 
enforcement procedures. Thus, licensing has little to do with 
effective spectrum management.
    Further, authorizing ships and aircraft to operate by rule 
is consistent with the provision in section 307 for the radio 
control and citizens band radio services. Finally, 
authorization for such ship and aircraft stations in domestic 
operations only would not violate the international radio 
regulations. Therefore, adoption of this amendment will improve 
efficiency of government operations and eliminate an 
unnecessary burden on vessel and aircraft operators.

Sec. 3020. Auction technical amendments

    This section amends section 309(j)(8) of the Communications 
Act to assist the FCC in its administration of spectrum 
auctions first authorized by the Omnibus Budget Reconciliation 
Act of 1993 (Public Law 103-66).
    Funding availability.--The FCC must expend funds in order 
to conduct spectrum auctions and then retain auction revenues 
to offset this cost. However, if the auction is conducted late 
in a fiscal year and the revenues are received too late to be 
expended within that fiscal year, then the FCC would not have 
the ability to use the retained funds. To provide the FCC with 
a basis to fund the auctions, this amendment will give the 
agency flexibility in the timing of collection and use of 
auction funds.
    Escrow of deposits.--This amendment will allow the FCC to 
establish a Spectrum Auction Deposit Account to: First, place 
auction revenues in an interest bearing escrow account; and 
second, pay interest to the unsuccessful bidders. Any auction 
payments made by prospective bidders to the FCC prior to 
competitive bidding will be deposited into this account, 
pending the outcome of the competitive bidding process.
    These funds will be invested in public debt securities and 
will not indicate acceptance of any bid. Funds submitted by 
prospective bidders who are not ultimately winning bidders for 
a license will be returned to such bidders after the FCC closes 
the bidding process. In such an event, the funds will be 
returned with the actual earned interest, less any applicable 
fees and penalties. For the winning or accepted bid, however, 
the interest accrued during the periods held in the account 
pending acceptance or rejection of the bid will accrue to the 
Federal Government.

Sec. 3021. Forfeitures for violations imperiling safety of life

    This section amends section 503(b)(1) of the Communications 
Act to allow the FCC to take appropriate administrative 
monetary sanction action in all instances of serious violations 
involving a requirement of the Act or FCC rules that imperils 
safety of life. For example, the FCC, by rule, requires ship 
radio stations to monitor channel 16--the emergency channel--
for distress calls from other ships, requires broadcast 
licensees periodically to check the lighting and painting of 
their broadcast towers for air navigation safety purposes, and 
requires cable television operators to prevent signal leakage 
from their systems that could interfere with critical aviation 
frequencies. These requirements relating to safety of life are 
extremely vital. However, due to the present definition of 
``willful,'' the omission of these required acts can only 
result in administrative sanction if there is evidence, 
extrinsic to the violation itself, that the omission was 
conscious and deliberate (irrespective of any intent to violate 
the act or the rule), which very rarely occurs; or if the 
violation was repeated.
    In these cases, the omission itself, whether conscious and 
deliberate or inadvertent, is an extremely serious one and 
should result in an appropriate administrative monetary 
forfeiture sanction. Yet, lacking evidence of a conscious or 
deliberate omission, the FCC cannot take administrative 
sanction action unless it catches the violator a second time on 
the basis of a ``repeated'' violation. Even then, if the 
violation is a continuing one, the violation must be detected 
on more than 1 day in order to be considered repeated. It is 
frequently difficult to detect repeated violations because many 
stations are located at considerable distances from FCC field 
offices and only receive periodic inspections at substantial 
intervals of time due to the distance and FCC budgetary 
constraints. Additionally, significant budgetary savings would 
occur in some instances by eliminating the present need to 
revisit licensees at considerable distances from field offices 
to determine whether administrative sanctions can be issued for 
serious violations on a repeated basis.

Sec. 3022. Use of experts and consultants

    This section allows market-based payments for experts and 
consultants. It would authorize the FCC to obtain the services 
of non-agency experts and consultants at higher rates of daily 
compensation than allowed under the current GS 15-step 10 
limit.

Sec. 3023. Statute of limitations for forfeiture proceedings against 
        common carriers

    This section amends section 503(b)(6) of the Communications 
Act to increase the statute of limitations period from 1 to 5 
years to assist in enforcement of the jurisdictional separation 
and cost allocation rules.
    Often, in the course of auditing a carrier's compliance 
with accounting rules, the auditors uncover violations of part 
64 (the Joint Cost rules) and part 36 (the Separations Manual). 
Forfeiture authority for violations of the accounting rules 
comes from section 220(d). Since section 220(d) does not 
contain a statute of limitations, the FCC has established by 
rule a 5-year limitation on forfeiture actions. Forfeiture 
authority for violations of the other costing rules, however, 
comes from section 503(b) of the Act, which has a statute of 
limitations of only 1 year.
    Since the auditors are usually looking at transactions that 
took place in previous years, most of the violations they find 
are a year old by the time they are discovered. Violations of 
parts 64 and 36 can almost never be pursued because of the 
short statute of limitations. Increasing the limitation period 
so that it is coextensive with the period during which 
accounting violations can be noticed would allow for consistent 
enforcement of the jurisdiction separations and cost allocation 
rules.
    This amendment also will extend the statute of limitations 
for violations by common carrier licensees of a number of other 
operational and technical requirements (e.g., failing to 
construct, exceeding authorized antenna height, etc.).

Sec. 3024. Utilization of FM band for assistive devices for hearing 
        impaired individuals

    This section requires the FCC to report to Congress in 6 
months on the use of the FM frequency band to facilitate the 
use of auditory assistive devices for the hearing impaired. The 
committee finds it important that the FCC addresses this matter 
in an expeditious manner.

Sec. 3025. Technical amendment

    This section makes a technical correction to section 
302(d)(1) of the Communications Act by striking in subparagraph 
(A) ``allocated to the domestic cellular radio 
telecommunications service'' and inserting ``utilized to 
provide commercial mobile service (as defined in section 
332(d);'' and by striking in subparagraph (C) ``cellular'' and 
inserting ``commercial mobile service.''
    This section is made necessary by the 1993 Omnibus Budget 
Reconciliation Act, which mandated that all Commercial Mobile 
Radio Service [CMRS] services be regulated in a similar manner. 
Extending the prohibition on scanners receiving cellular radio 
transmissions to all CMRS transmissions is necessary to ensure 
that all of these services are provided the same level of 
privacy protection.

               Changes in Existing Law Made by Subtitle A

    The changes in existing law made by subtitle A are included 
at the conclusion of the report on this title of the bill.

        Subtitle B--Nuclear Regulatory Commission Annual Charge

                          Purpose and Summary

    Subtitle B extends the Nuclear Regulatory Commission's 
[NRC] authority to collect up to 100 percent of its budget from 
user fees through fiscal year 2002.

                  Background and Need for Legislation

    The NRC is responsible for ensuring the safety of civilian 
uses of nuclear materials. The independence and integrity of 
this agency is essential to maintaining the confidence of the 
public in the use of nuclear energy and radioactive materials. 
Thus, a reliable stream of long-term funding is vital to 
assuring the uninterrupted operation of this important 
organization.
    The NRC budget is paid for entirely through user fees on 
licensees, except for work on the high-level nuclear waste 
repository which is paid for through the Nuclear Waste Fund. 
User fees are an equitable way of paying for the cost of 
Federal regulation. Currently, user fees are used to fund 
several Federal agencies or programs including the Federal 
Energy Regulatory Commission, the Securities and Exchange 
Commission, and the pipeline safety program under the authority 
of the U.S. Department of Transportation. By collecting user 
fees, those who use an agency's resources pay the costs of 
funding that agency. Those who use the greatest amount of the 
agency's resources are required to pay the greatest annual 
fees. In the case of the NRC, nuclear licensees pay for the 
cost of Federal regulation and then pass that cost on to their 
customers. The result is an equitable one: those who do not buy 
electricity or products generated by nuclear power do not bear 
the cost of regulating it.
    Section 6101 of the Omnibus Budget Reconciliation Act of 
1990 (Public Law 101-508) requires the Nuclear Regulatory 
Commission to collect annual charges from its licensees to 
provide offsetting collections to pay for its programs. 
Specifically, section 6101 allows the NRC to collect amounts 
which, when added to other amounts collected by the NRC (such 
as fees collected under the Independent Offices Appropriation 
Act of 1952, 31 U.S.C. 9701), equals 100 percent. However, 
current law only provides authority to collect fees and annual 
charges equal to 100 percent of the NRC's budget through fiscal 
year 1998. Absent an extension, after fiscal year 1998, NRC's 
permanent authority to collect 33 percent of its budget 
authority through fees and annual charges would take effect.
    Currently, the NRC budget is made up of money collected 
through three different methodologies. First, the NRC receives 
appropriations from the Nuclear Waste Fund established under 
section 302(c) of the Nuclear Waste Policy Act of 1982 (42 
U.S.C. 10222(c)) for licensing the Department of Energy's 
nuclear waste management program. Charges for these activities 
are not recovered through annual charges because nuclear 
utilities are paying for the cost of these activities through 
their payments to the Nuclear Waste Fund. Thus, recovery of 
Nuclear Waste Fund appropriations through the annual charge 
would constitute double payment by the utilities.
    The NRC also recovers a portion of its budget through fees 
assessed on licensees under the Independent Offices 
Appropriation Act of 1952 (31 U.S.C. 9701). This Act provides 
that anyone receiving a service or a thing of value from the 
NRC shall pay the NRC's cost of providing that service or thing 
of value. The purpose of this provision is to recover the costs 
of providing individually identifiable services to applicants 
and holders of NRC licensees from the recipients of those 
services. Finally, generic NRC activities that benefit all 
licensees generally are recovered through annual charges.
    Subtitle B extends NRC authority to collect up to 100 
percent of its budget through user fees through fiscal year 
2002. This extension will generate revenues in amounts 
sufficient to offset expenditures by the NRC. The NRC is 
charged by the Omnibus Budget Reconciliation Act of 1990 to 
asses these charges under the principle that licensees who 
require the greatest expenditures of the NRC's resources should 
pay the greatest annual charge. Subtitle B does not alter, in 
any way, the fee structure a currently collected by the NRC.

                                Hearings

    The committee's Subcommittee on Energy and Power did not 
hold hearings on section 3031 of subtitle B.

                        Committee Consideration

    On July 28, 1995, the Subcommittee on Energy and Power met 
in open session and approved for full committee consideration a 
committee print embodying the text of section 3031 without 
amendment by a voice vote. On September 13, 1995, the committee 
met in open session and ordered subtitle B transmitted to the 
House Committee on the Budget for inclusion in the fiscal year 
1996 Omnibus Budget Reconciliation Act, without amendment, by a 
roll call vote of 29 yeas to 11 nays.

                             Rollcall Votes

    Pursuant to clause 2(1)(2)(B) of rule XI of the Rules of 
the House of Representatives, following are listed the recorded 
votes on the motion to order Subtitle B transmitted to the 
House Committee on the Budget, including the names of those 
Members voting for and against.

                          rollcall vote no. 62

    Bill: Committee print entitled ``Nuclear Regulatory 
Commission Annual Charge.''
    Quorum call: 26 members answered present.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........  ........         X   Mr. Dingell......  ........  ........         X 
Mr. Moorhead...................  ........  ........         X   Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........  ........         X   Mr. Markey.......  ........  ........         X 
Mr. Fields.....................  ........  ........  .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........  ........         X   Mr. Hall.........  ........  ........  .........
Mr. Bilirakis..................  ........  ........         X   Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........  ........         X   Mr. Boucher......  ........  ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......  ........  ........  .........
Mr. Hastert....................  ........  ........         X   Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........  ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........  ........         X   Mr. Pallone......  ........  ........         X 
Mr. Paxon......................  ........  ........  .........  Mr. Brown........  ........  ........         X 
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....  ........  ........         X 
Mr. Klug.......................  ........  ........         X   Mr. Gordon.......  ........  ........  .........
Mr. Franks.....................  ........  ........         X   Ms. Furse........  ........  ........         X 
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......  ........  ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........  ........  ........         X 
Mr. Cox........................  ........  ........  .........  Ms. Eshoo........  ........  ........         X 
Mr. Deal.......................  ........  ........  .........  Mr. Klink........  ........  ........         X 
Mr. Burr.......................  ........  ........         X   Mr. Stupak.......  ........  ........         X 
Mr. Bilbray....................  ........  ........         X                                                   
Mr. Whitfield..................  ........  ........         X                                                   
Mr. Ganske.....................  ........  ........         X                                                   
Mr. Frisa......................  ........  ........         X                                                   
Mr. Norwood....................  ........  ........  .........                                                  
Mr. White......................  ........  ........  .........                                                  
Mr. Coburn.....................  ........  ........         X                                                   
----------------------------------------------------------------------------------------------------------------

                          ROLLCALL VOTE No. 63

    Bill: Committee print entitled ``Nuclear Regulatory 
Commission Annual Charge''
    Motion: Motion by Mr. Bliley to order the committee print 
entitled ``Nuclear Regulatory Commission Annual Charge'' 
transmitted to the Committee on the Budget for inclusion in the 
fiscal year 1996 Omnibus Budget Reconciliation Act.
    Disposition: Agreed to, by a rollcall vote of 29 yeas to 11 
nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
 Mr. Bliley....................        X   ........  .........  Mr. Dingel.......  ........        X   .........
 Mr. Moorhead..................        X   ........  .........  Mr. Waxman.......  ........  ........  .........
 Mr. Tauzin....................  ........  ........  .........  Mr. Markey.......  ........        X   .........
 Mr. Fields....................        X   ........  .........  Mr. Wyden........        X   ........  .........
 Mr. Oxley.....................        X   ........  .........  Mr. Hall.........        X   ........  .........
 Mr. Bilirakis.................        X   ........  .........  Mr. Bryant.......  ........        X   .........
 Mr. Schaefer..................        X   ........  .........  Mr. Boucher......  ........        X   .........
 Mr. Barton....................  ........  ........  .........  Mr. Manton.......  ........        X   .........
 Mr. Hastert...................        X   ........  .........  Mr. Towns........  ........        X   .........
 Mr. Upton.....................        X   ........  .........  Mr. Studds.......  ........  ........  .........
 Mr. Stearns...................        X   ........  .........  Mr. Pallone......        X   ........  .........
 Mr. Paxon.....................        X   ........  .........  Mr. Brown........  ........        X   .........
 Mr. Gillmor...................        X   ........  .........  Mrs. Lincoln.....        X   ........  .........
 Mr. Klug......................        X   ........  .........  Mr. Gordon.......        X   ........  .........
 Mr. Franks....................        X   ........  .........  Ms. Furse........  ........        X   .........
 Mr. Greenwood.................  ........  ........  .........  Mr. Deutsch......        X   ........  .........
 Mr. Crapo.....................        X   ........  .........  Mr. Rush.........  ........        X   .........
 Mr. Cox.......................  ........  ........  .........  Ms. Eshoo........  ........        X   .........
 Mr. Deal......................  ........  ........  .........  Mr. Klink........  ........        X   .........
 Mr. Burr......................        X   ........  .........  Mr. Stupak.......        X   ........  .........
 Mr. Bilbray...................        X   ........  .........                                                  
 Mr. Whitfield.................        X   ........  .........                                                  
 Mr. Ganske....................        X   ........  .........                                                  
 Mr. Frisa.....................  ........  ........  .........                                                  
 Mr. Norwood...................        X   ........  .........                                                  
 Mr. White.....................        X   ........  .........                                                  
 Mr. Coburn....................        X   ........  .........                                                  
----------------------------------------------------------------------------------------------------------------

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the committee has not held 
oversight or legislative hearings on this subtitle.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the committee by the Committee on Government 
Reform and Oversight.

                        Committee Cost Estimate

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the committee believes that 
enactment of subtitle B would result in no additional costs to 
the Federal Government.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, a letter from the Congressional 
Budget Office providing a cost estimate for all six subtitles 
of title III is found at the conclusion of title XVII of this 
bill.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee finds that subtitle B 
would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

    Section 3031 amends section 6101(a)(3) of the Omnibus 
Budget Reconciliation Act of 1990 to extend the current user 
fee that pays for the budget of the NRC to cover fiscal years 
1999-2002.

               Changes in Existing Law Made by Subtitle B

    The changes in existing law made by subtitle B are included 
at the conclusion of the report of this title of the bill.

            Subtitle C--United States Enrichment Corporation

                          Purpose and Summary

    The purpose of title III, subtitle C, the USEC 
Privatization Act, is to facilitate the privatization of the 
United States Enrichment Corporation [USEC]. The legislation 
contains provisions to increase the return to the taxpayers 
from the sale of the Corporation by enhancing the value of the 
Corporation to potential purchasers or shareholders, and by 
eliminating burdensome statutory requirements for the 
privatized corporation.

                  Background and Need for Legislation

    The United States Enrichment Corporation [USEC] is a 
Government corporation established by title IX of the Energy 
Policy Act of 1992 [EPAct]. USEC produces and markets uranium 
enrichment services to more than 60 utilities which own and 
operate commercial nuclear power plants in the United States 
and 11 foreign countries (90 percent of the domestic market and 
40 percent of the world market). It operates two enrichment 
facilities located in Paducah, KY, and Portsmouth, OH, with 
total employment of approximately 4,500 persons. The 
Corporation has annual revenues of approximately $1.5 billion.
    Prior to the creation of USEC, the Department of Energy's 
uranium enrichment program supplied enriched uranium for use at 
commercial nuclear power plants. At that time, uranium 
enrichment was the only part of the nuclear fuel cycle related 
to production or use that was not a private sector 
responsibility. The United States had a near-monopoly on the 
world uranium enrichment market until the 1970's, at which time 
competition from foreign competitors began to significantly 
erode U.S. market share. Today, less than half of the world 
market is served by U.S. enrichment services. In passing EPAct, 
Congress recognized the dangers this situation presented for 
maintaining a viable U.S. presence in the uranium enrichment 
market and took the first step toward privatization by creating 
the quasi-governmental USEC. Subtitle C establishes the 
framework for full privatization and will provide the 
Corporation with the additional operating flexibility needed to 
ensure a future for the domestic uranium and uranium enrichment 
industries.
    In creating USEC, the Congress laid out three principles 
for the Corporation to follow: First, that the Corporation must 
be treated like a private corporation to the fullest extent 
practicable; second, that the Corporation must be a profit 
maximizer; and third, that the Corporation must pay its own 
way. It is intended that the full privatization of the 
Corporation will continue to follow these principles, and allow 
for the creation of a private entity which will provide a 
maximum return for the taxpayer's investment in the Corporation 
and which will be a strong and economically viable force in the 
market. The Corporation must not be burdened with additional 
layers of bureaucracy not required of other private business 
entities. The Corporation must also be allowed to maximize it 
profits in the private sector, making itself an attractive 
investment opportunity and paving the way for a healthy and 
vigorous life in American business. A key component of this 
effort will be additional research on and development of 
uranium enrichment technologies, including the Atomic Vapor 
Laser Isotope Separation [AVLIS] technology. This technology 
was transferred to the Corporation in EPAct, and it is expected 
that further development of AVLIS will be accomplished without 
the benefit of Federal subsidization.
    The administration indicated support for the privatization 
of the Corporation in its fiscal year 1996 budget request to 
Congress. It estimates that proceeds from the sale will return 
$1.5 to $1.9 billion to the U.S. Treasury. Privatization of the 
Corporation will ensure the future of the domestic uranium and 
uranium enrichment industries and will provide significant 
returns to the Federal Treasury, not only from the proceeds of 
the initial sale but also from the tax revenues and royalty 
payments generated from the privatized corporation.

                                Hearings

    On February 24, 1995, the Subcommittee on Energy and Power 
held a hearing on privatization of the United States Enrichment 
Corporation. Witnesses included: Mr. William J. Timbers, Jr., 
President, United States Enrichment Corporation; Mr. Robert 
Bernero, Director, Office of Nuclear Material, Safety and 
Safeguards, U.S. Nuclear Regulatory Commission; Mr. Victor 
Rezendes, Director, Energy and Science Issues, U.S. General 
Accounting Office; Mr. James Derryberry, managing director, 
J.P. Morgan and Associates; and Mr. William Magavern, director, 
Critical Mass Energy Project, public citizen.

                        Committee Consideration

    On March 15, 1995, the committee met in open session to 
consider H.R. 1216, the USEC Privatization Act. The committee 
ordered reported the bill H.R. 1216, with amendments, by a 
voice vote, a quorum being present. An accounting of that 
measure can be found in House Report 104-86, and the language 
reported in H.R. 1216 was modified during the committee's 
consideration of subtitle C.
    On September 13, 1995, the committee met in open session to 
consider subtitle C of title III, the USEC Privatization Act. 
The committee ordered subtitle C transmitted to the House 
Committee on the Budget, with an amendment in the nature of a 
substitute, by a voice vote, a quorum being present.

                             Rollcall Votes

    Clause 2(l)(2)(B) of rule XI of the Rules of the House of 
Representatives requires the committee to list the recorded 
votes on the motion to report and on amendments thereto. There 
were no recorded votes taken in connection with ordering 
subtitle C transmitted or in adopting amendments thereto. The 
voice votes taken in committee, as well as the quorum call 
taken on September 13, 1995, are as follows:

                          rollcall vote no. 62

    Bill: Committee print entitled ``United States Enrichment 
Corporation.''
    Quorum call: 26 members answered present.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........  ........         X   Mr. Dingell......  ........  ........         X 
Mr. Moorhead...................  ........  ........         X   Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........  ........         X   Mr. Markey.......  ........  ........         X 
Mr. Fields.....................  ........  ........  .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........  ........         X   Mr. Hall.........  ........  ........  .........
Mr. Bilirakis..................  ........  ........         X   Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........  ........         X   Mr. Boucher......  ........  ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......  ........  ........  .........
Mr. Hastert....................  ........  ........         X   Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........  ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........  ........         X   Mr. Pallone......  ........  ........         X 
Mr. Paxon......................  ........  ........  .........  Mr. Brown........  ........  ........         X 
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....  ........  ........         X 
Mr. Klug.......................  ........  ........         X   Mr. Gordon.......  ........  ........  .........
Mr. Franks.....................  ........  ........         X   Ms. Furse........  ........  ........         X 
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......  ........  ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........  ........  ........         X 
Mr. Cox........................  ........  ........  .........  Ms. Eshoo........  ........  ........         X 
Mr. Deal.......................  ........  ........  .........  Mr. Klink........  ........  ........         X 
Mr. Burr.......................  ........  ........         X   Mr. Stupak.......  ........  ........         X 
Mr. Bilbray....................  ........  ........         X                                                   
Mr. Whitfield..................  ........  ........         X                                                   
Mr. Ganske.....................  ........  ........         X                                                   
Mr. Frisa......................  ........  ........         X                                                   
Mr. Norwood....................  ........  ........  .........                                                  
Mr. White......................  ........  ........  .........                                                  
Mr. Coburn.....................  ........  ........         X                                                   
----------------------------------------------------------------------------------------------------------------

           Committee on Commerce--104th Congress--Voice Votes

    Bill: Committee print entitled ``United States Enrichment 
Corporation.''
    Amendment: Amendment in the nature of a substitute by Mr. 
Schaefer.
    Disposition: Agreed to, as amended, by a voice vote.
    Amendment: Amendment by Mr. Markey to the Schaefer 
amendment in the nature of a substitute re: strike the section 
relating to gaseous diffusion technology.
    Disposition: Agreed to, by a voice vote.
    Motion: Motion by Mr. Bliley to order the committee print 
entitled ``United States Enrichment Corporation,'' as amended, 
transmitted to the Committee on the Budget for inclusion in the 
fiscal year 1996 Omnibus Budget Reconciliation Act.
    Disposition: Agreed to, by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Subcommittee on Energy and 
Power conducted an oversight hearing and made findings that are 
reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the committee by the Committee on Government 
Reform and Oversight.

                        Committee Cost Estimate

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the committee believes that 
enactment of subtitle B would result in no additional costs to 
the Federal Government.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, a letter from the Congressional 
Budget Office providing a cost estimate for all six subtitles 
of title III is found at the conclusion of title XVII of this 
bill.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee finds that subtitle C 
would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

Sec. 3035. Short title and reference

    This section provides that the Act may be cited as the 
``USEC Privatization Act.'' It also provides that references to 
sections in the act shall be considered to be made to the 
Atomic Energy Act of 1954 (42 U.S.C. 2011 et seq.).

Sec. 3036. Production facility

    This section amends the definition of the term ``production 
facility'' set forth in section 11 of title I of the Atomic 
Energy Act [AEA] to exclude the construction and operation of a 
uranium enrichment facility using Atomic Vapor Laser Isotope 
Separation [AVLIS] technology from the definition of production 
facility. As a result, any uranium enrichment facility using 
AVLIS technology would be eligible for one-step licensing under 
the materials licensing provisions of section 53 and 63 of the 
AEA.

Sec. 3037. Definitions

    The section amends and adds certain definitions to section 
1201 of the AEA.

 Sec. 3038. Employees of the Corporation

    This section provides certain protections for the employees 
of the privatized corporation. Section 3038(a) provides that 
the privatization shall not result in any adverse effects on 
the pension benefits of employees at facilities that are 
operated, directly or under contract, in the performance of the 
functions vested in the Corporation. It also ensures that 
assets and liabilities associated with pension benefits plans 
will be transferred to the new contractor or private 
corporation in the case of a contractor change. It is the 
committee's intent that the pension plans will remain intact, 
regardless of changes in contractor or owner at the gaseous 
diffusion plant, and to prevent the privatized corporation from 
taking actions which would result in any adverse affects to the 
pension benefits.
    Section 3038(a) also provides that the Corporation shall 
abide by the terms of any unexpired collective bargaining 
agreement that is in effect on the privatization date at each 
gaseous diffusion plant. Additionally, in the event of a mass 
layoff or plant closing at one of the gaseous diffusion plants, 
the section provides that employees of the Corporation as of 
the privatization date will be considered as Department of 
Energy employees for purposes of sections 3161 through 3163 of 
the National Defense Authorization Act for fiscal year 1993 (42 
U.S.C. 7272h-7274j). These provisions allow for hiring 
preferences within Federal Government employment for 
preprivatization employees affected by a possible mass layoff 
or plant shutdown after privatization. Section 3038(a) also 
ensures the continuity of employees' health benefits during the 
privatization process.
    Section 3038(b) deletes provisions relating to departmental 
detailees. Such provisions are no longer necessary in that 
there are no Department of Energy employees currently detailed 
to the Corporation. This section also clarifies current law 
which provides that employees of the Corporation who 
transferred to the Corporation from other Federal employment 
have the option to have any accrued retirement benefits 
transferred to a retirement system established by the 
Corporation or to retain their coverage under either the Civil 
Service Retirement System or the Federal Employees' Retirement 
System, as applicable, in lieu of coverage by the Corporation's 
retirement system.
    The committee's intent is to confirm existing policy and 
practice with respect to retiree health expenditures which for 
DOE are subject to annual appropriations. The Commerce 
Committee believes this section does not increase the 
liabilities of either DOE or USEC and is consistent with 
existing agreements. Significantly, DOE, the private 
corporation, and the operating contractor retain the right to 
implement cost-saving measures with respect to the post-
retirement health benefit plans of employees at the gaseous 
diffusion plants.

Sec. 3039. Marketing and contract authority

    Section 3039(a) amends section 1401(a) of the AEA to 
eliminate the Corporation's authority to act as the exclusive 
marketing agent on behalf of the U.S. Government for the 
provision of enriched uranium and uranium enrichment and 
related services.
    Section 3039(b) amends current law to clarify that 
privatization will not affect the terms of, or the rights and 
obligations of the parties to, power purchase contracts 
executed by the Department prior to the transition date and 
that relate to uranium enrichment, but which the Secretary 
determined were not transferable to the Corporation. The 
section also adds a new subsection (3) to section 1401(b) to 
clarify the effect of the transfer of the contracts, agreements 
and leases entered into by the U.S. Government through the 
Department of its predecessors which were transferred to the 
Corporation pursuant to section 1401(b) of the AEA. Subsection 
(3)(A) provides that as a result of the transfer, all rights, 
privileges and benefits under the contracts, agreements and 
leases, including the right to amend, modify, extend, revise or 
terminate any of the contracts, agreements or leases, were 
irrevocably assigned to the Corporation for its exclusive 
benefit. As a consequence, no U.S. Government consent shall be 
required for any amendment, modification, extension, revision 
or termination of any of the contracts, agreement or leases. 
Subsections (3)(B) and (3)(C) provide that notwithstanding the 
transfer of the contracts, agreements and leases to the 
Corporation, the United States will remain obligated to the 
parties to the contracts, agreements and leases until such time 
as the contracts, agreements or leases are materially modified 
or terminated. In addition, the Corporation will be obligated 
to fully reimburse the United States for amounts paid by the 
United States for fulfilling obligations under the contracts, 
agreements and leases arising after the privatization date to 
the extent such amounts are legal and valid obligations of the 
Corporation then due.
    Section 3039(c) simply authorizes the Corporation to 
establish prices for its products and services that will allow 
it to attain the normal business objectives of a profitmaking 
corporation.
    Section 3039(d) amends section 1403 of the AEA by adding a 
new subsection (h) relating to the disposal of low-level 
radioactive waste and mixed waste created in the course of the 
Corporation's operations. It authorizes the Corporation to 
request that DOE accept low-level radioactive waste and mixed 
waste generated as a result of the operations of the facilities 
and related property leased by the Corporation from the 
Department or as a result of off-site treatment of such wastes. 
It further provides that all low-level radioactive wastes and 
mixed wastes that the Department accepts for treatment, 
storage, or disposal shall be deemed to be generated by the 
Department. The Corporation is directed to reimburse DOE for 
the treatment, storage or disposal of such waste in an amount 
equal to the Department's costs but in no event greater than an 
amount equal to that which would be charged by commercial, 
State, regional or interstate compact entities of similar 
services. The section also authorizes the Corporation to enter 
into agreements for the treatment, storage or disposal of low-
level radioactive waste and mixed waste with any person other 
than the Department that is authorized by applicable laws and 
regulations to treat, store or dispose of such wastes.
    Section 3039(e) provides that liabilities based on 
operations of the Corporation from the transition date to the 
privatization date shall be direct liabilities of the United 
States and that any judgment entered against the Corporation 
imposing liability arising out of the operation of the 
Corporation during such period will be considered a judgment 
against the United States. In the event the privatization does 
not occur, the Corporation shall retain all liabilities based 
on operations of the Corporation from the transition date. 
After privatization, liabilities arising from operation of the 
uranium enrichment enterprise would be borne by the private 
investors of the Corporation.
    Section 3039(f) adds a new section 1408 related to uranium 
transfers and sales. Section 1408(a) ensures that DOE will not 
provide uranium enrichment services nor transfer or sell any 
uranium except as provided by this section. Section 1408(b) 
establishes the process by which Russian highly-enriched 
uranium would be transferred to the United States and other 
parties. The language provides that the United States Executive 
Agent, under the Russian HEU agreement, shall transfer an 
amount of uranium hexafluoride equivalent to the natural 
uranium component of low-enriched uranium derived from at least 
18 metric tons of highly-enriched uranium to the Secretary 
prior to December 31, 1996. The title to such material will 
reside with the Secretary, and within seven years of the 
privatization date of the USEC, the Secretary shall enter into 
contracts to sell this uranium hexafluoride for the following 
purposes: (a) for overfeeding; (b) for use outside the United 
States; or (c) for use within the United States not prior to 
January 1, 2002, and in volumes not exceeding three million 
pounds U3O8 annually.
    After January 1, 1997, the Russian executive agent may 
request the return of uranium hexafluoride to a North American 
facility designated by the agent. Title to such material will 
reside with the Russian executive agent, and may be sold to any 
person consistent with the provisions of this section. If, for 
any reason, the Russian executive agent does not request the 
delivery of the natural uranium component of any low-enriched 
uranium within 90 days of delivery to the United States 
executive agent, then the United States agent shall auction 
such material. Such auction will be conducted by an independent 
party through a competitive bidding process, and proceeds from 
the auction, less transaction and administrative costs, will be 
paid to the Russian executive agent. Title to the material is 
transferred to the buyer upon delivery of such material.
    Section 1408(b)(5) establishes limitations on the amount of 
Russian uranium hexafluoride available for U.S. consumption, 
graduating from two million pounds of U3O8 equivalent in 1998 
to 16 million pounds of U3O8 equivalent in 2005 and each year 
thereafter. In cases where Russian material is utilized in a 
``matched sale'' of United States-origin material, or where 
Russian material is utilized for overfeeding purposes, such 
material is not subject to time or amount limitations.
    Section 1408(c) authorizes the Secretary of Energy to 
transfer up to 50 metric tons of highly-enriched uranium and up 
to 7,000 metric tons of natural uranium without charge prior to 
the privatization date. The subsection also places restrictions 
on the uses of such uranium. Section 1408(d) allows the 
Secretary to sell excess uranium from the DOE stockpile, 
subject to certain limitations. Section 1408(e) allows the 
Secretary to transfer or sell low-enriched uranium to other 
Federal agencies, to other persons for national security 
purposes, or other entities for uses other than the generation 
of electricity for commercial use.

Sec. 3040. Privatization of the corporation

    Section 3040(a) amends chapter 25, of Title II of the AEA 
by adding a new section 1503 that authorizes the Corporation to 
establish a corporation for purposes of implementing 
privatization and sets forth certain other matters with respect 
to such corporation. Under section 1503(a), the corporation may 
be organized under the laws of any State. The corporation will 
have among its purposes to help maintain a reliable and 
economical domestic source of uranium enrichment services and 
will be authorized to exercise the rights of the Corporation 
under the AEA, including enriching uranium. In addition, the 
corporation will have such purposes and powers as are set forth 
in its articles or certificate of incorporation and as are 
provided under the laws of the jurisdiction of its 
organization. For purposes of implementing the privatization, 
the Corporation is authorized to (i) transfer some or all of 
its assets (including funds, contracts and leases) and 
liabilities to the corporation, and (ii) merge or consolidate 
with the corporation if such action is contemplated by the plan 
for privatization approved by the President. The Board of 
Directors of the Corporation is authorized to approve such 
merger or consolidation and to take all further actions 
necessary in connection with it, without shareholder action. 
The section also provides that the merger or consolidation 
shall be effected in accordance with, and have the effects of a 
merger or consolidation under, the laws of the jurisdiction of 
incorporation of the surviving corporation and all rights and 
benefits provided under the AEA to the Corporation shall apply 
to the surviving corporation as if it were the Corporation.
    Section 1503(b) provides that for purposes of the 
regulation of radiological and non-radiological hazards under 
the Occupational Safety and Health Act of 1970, the corporation 
will be treated in the same manner as other employers licensed 
by the Nuclear Regulatory Commission (NRC). Any interagency 
agreement entered into between the NRC and the Occupational 
Safety and Health Administration governing the scope of their 
respective regulatory authorities will apply to the corporation 
as if it were an NRC licensee.
    Section 1503(c) provides the corporation will not be an 
agency, instrumentality, or establishment of the United States 
Government and shall not be a Government corporation or 
Government controlled corporation, and that obligations of the 
corporation will not be obligations of the United States.
    Section 1503(d) provides that in the event the 
privatization is implemented by means of a public offering, an 
election of the members of the board of directors of the 
Corporation by the shareholders shall be conducted within 1 
year of the date shares are first offered to the public 
pursuant to such public offering.
    Section 1503(e) provides that the Secretary of Energy shall 
not allow the privatization by means of a public offering 
unless the Secretary determines that the estimated sum of the 
gross proceeds from the sale of the Corporation will be an 
adequate amount.
    Section 3040(b) amends title II of the AEA by adding a new 
section 1504 which provides that if the privatization is 
implemented by a public offering, during the 3-year period 
following privatization, no person, directly or indirectly, may 
acquire or hold securities representing more than 10 percent of 
the total votes of all outstanding voting securities of the 
Corporation. The ownership limitation would not apply: First, 
to any employee stock ownership plan of the Corporation; 
second, to underwriting syndicates holding shares for resale; 
or third, in the case of shares beneficially held for others, 
to commercial banks, broker-dealers, clearing corporations, or 
other nominees. Subsection (c) of Section 1504 provides that 
directors, officers and employees of the Corporation may not 
acquire any securities, or any right to acquire securities, of 
the Corporation: First, in the public offering implementing the 
privatization; second, pursuant to any agreement, arrangement 
or understanding entered into before the privatization date; or 
third, before the election of directors of the Corporation 
under section 1503(d), on any terms more favorable than those 
offered to the public. These protections are necessary to 
ensure that privatization decisions made by the officers, 
directors and employees of the Corporation benefit the public 
interest in maximizing the return to the taxpayer from the sale 
of this asset and to assure that personal financial 
considerations do not interfere with the decision-making 
process as various privatization options are considered. The 
provision ensures that stock options and employee benefits 
packages are delinked from the privatization process itself.
    Section 3040(c) amends title II of the AEA by adding a new 
section 1505. Subsection (a) of section 1505 exempts each 
director, officer, employee and agent of the Corporation from 
liability if such person were fulfilling a duty, in connection 
with any action taken in connection with the privatization, 
which such person in good faith reasonably believed to be 
required by law or vested in such person. Sections 1505(b) and 
1505(c) provide that the privatization and offering or sale of 
securities shall be subject to the Securities Act of 1933 and 
the Securities Exchange Act of 1934. Under existing law, the 
Corporation is exempt from Federal securities laws until the 
privatization date. Sections 1505(b) and 1505(c) make clear 
that the Corporation's general exemption from the Federal 
securities laws, however, will not apply to the privatization 
transaction.
    Section 3040(d) amends title II of the AEA by adding a new 
section 1506 that provides that the Corporation shall not be 
considered to be in breach, default, or violation of any 
agreement to which it is a party because of any provision of 
chapter 25 or any action the Corporation is required to take 
thereunder. The section also states that the United States 
withdraws its consent to be sued with respect to any claim 
arising out of or resulting from any act or omission under 
chapter 25 of the AEA. Consequently, the United States will not 
be subject to any claims, for example, arising under the 
Federal securities laws in connection with the privatization 
transaction, notwithstanding the fact that under section 
1505(b) the privatization is subject to the Securities Act of 
1933 and the Securities Exchange Act of 1934.
    Section 3040(e) amends title II of the AEA by adding a new 
section 1507 that provides that the proceeds to the U.S. 
Government from the privatization shall be included in the 
budget baseline required by the Balanced Budget and Emergency 
Deficit Control Act of 1985 and shall be counted as an offset 
to direct spending for purposes of section 252 of such Act, 
notwithstanding section 257(e) of such Act which generally 
prohibits counting asset sales as offsets to spending.
    Section 3040(g) amends section 193 of the AEA by adding a 
new subsection (f) that provides that if the privatization of 
the Corporation results in the Corporation being (1) owned, 
controlled, or dominated by a foreign corporation or a foreign 
government, or (2) inimical to the common defense or security 
of the United States, then any license held by the Corporation 
under sections 53 and 63 of the AEA shall be terminated. This 
language ensures that uranium enrichment activities will be 
subject to the same foreign ownership limitations as any other 
nuclear production or utilization facility. It is expected that 
any interpretation of the terms in new subsection (f) would be 
consistent with the historical administrative interpretation of 
similar language in sections 103, 104 an 1502(a) of the AEA.
    Section 3040(h) amends section 1502(d) of the AEA to 
provide that the Corporation may not implement its 
privatization plan less than 60 days after the date of the 
report to Congress by the Comptroller General under section 
1502(c). The Comptroller General is obligated under section 
1502(c) to deliver its report to Congress evaluating the 
privatization plan within 30 days of Congress being notified of 
the Corporation's intent to implement the privatization plan. 
Accordingly, the Corporation will now have a minimum waiting 
period of 90 days after notifying Congress of its intent to 
implement its privatization plan before the Corporation may 
actually implement the plan.

Sec. 3041. Periodic certification of compliance

    This section provides that the Corporation shall be 
required to apply to the Nuclear Regulatory Commission for a 
certificate of compliance under section 1701(c)(1) 
periodically, as determined by the Nuclear Regulatory 
Commission, but not less than every 5 years. This change will 
conform the certification requirement to existing NRC licensing 
timeframes.

Sec. 3042. Licensing of other technologies

    Section 3042 amends section 1702(a) of the AEA to provide 
that Corporation facilities using AVLIS technology will be 
licensed under sections 53 and 63 of the AEA. Other uranium 
enrichment technologies are currently eligible for one-step 
licensing, and this provision simply ensures equal treatment 
for all enrichment technologies.

Sec. 3043. Conforming amendments

    This section provides for the repeal of certain provisions 
of the Atomic Energy Act. Upon privatization of the 
Corporation, certain provisions of the AEA generally relating 
to the organization and governance of the Corporation as a 
Federal Agency, as well as provisions granting the Corporation 
certain rights such as an exemption from State and local 
property taxes, would be inconsistent with the governance and 
rights of a corporation owned by private investors. 
Accordingly, such provisions are repealed following 
privatization. This Section also provides that following 
privatization, references to the Corporation under title I of 
the AEA shall be deemed to mean the Corporation referred to in 
section 1201 of the AEA, and section 9101(3)(N) of title 31 of 
the United States Code shall be deleted.

               Changes in Existing Law Made by Subtitle C

    The changes in existing law made by Subtitle C are included 
at the conclusion of report on this title of the bill.

                Subtitle D--Waste Isolation Pilot Plant

                          Purpose and Summary

    The purpose of Title III, Subtitle D, the ``Waste Isolation 
Pilot Plant Land Withdrawal Amendment Act,'' is to eliminate 
outdated statutory requirements for, and expedite the 
commencement of, operations at the Waste Isolation Pilot Plant 
[WIPP]. The WIPP is the nation's first repository for the 
permanent disposal of transuranic materials.

                  Background and Need for Legislation

I. Transuranic waste

    Transuranic [TRU] elements--those with a periodic table 
value greater than uranium--are generally man-made products 
synthesized in laboratory conditions. The primary use of TRU 
materials in the United States is for the defense nuclear 
weapons program. Most TRU waste consists of trash, such as 
protective clothing, lab instruments, and equipment which has 
been contaminated by TRU isotopes. TRU waste is differentiated 
from other radioactive materials by the presence of TRU 
particles, which have gross radiation levels that are much 
lower than high-level wastes. The greatest danger from TRU 
waste is not from its effects on the body or from ingestion, 
but from inhalation of particles or entry into the bloodstream.
    As a result, over 97 percent of TRU waste can be safely 
handled if shielded in an appropriate waste container, 
generally a 55-gallon steel drum or other steel container. The 
remaining 3 percent of TRU wastes must be remotely handled, due 
primarily to the presence of non-TRU radioactive materials 
which contain beta and gamma radiation which can penetrate 
standard steel containers and require additional shielding for 
transportation and storage. TRU wastes are currently stored on-
site at generating facilities, with a vast majority of these 
wastes being located at 10 different Department of Energy 
sites. Until 1970, TRU waste was disposed of in a manner 
similar to that used for low-level radioactive wastes, usually 
by burial in shallow earth trenches.

II. The waste isolation pilot plant

    In 1970, the Atomic Energy Commission (forerunner of the 
Department of Energy) determined that TRU wastes should be 
handled in a more comprehensive fashion, and began siting 
studies which resulted in the decision to construct a facility 
about 26 miles east of Carlsbad, NM. Congress authorized the 
construction of the WIPP in 1979 as part of the Department of 
Energy National Security and Military. Application of Nuclear 
Energy Authorization Act (Public Law 96-164). Construction of 
the facility, located in a salt formulation about 2,100 feet 
below the earth's surface, began shortly thereafter. In 1992, 
Congress passed the Waste Isolation Pilot Plant Land Withdrawal 
Act (Public Law 102-579) to transfer ownership of the land 
surrounding WIPP to the Department of Energy (DOE), and 
authorized the Department to begin underground experiments 
using TRU waste.
    In October of 1993, DOE announced that it would forego on-
site testing of waste at WIPP in favor of laboratory testing at 
the Sandia National Laboratories to determine the site's 
suitability for disposing of TRU waste. The testing was through 
a ``performance assessment'' of the WIPP, which utilizes a 
combination of non-waste tests at the site and laboratory 
mathematical models, and which will accurately predict the 
behavior of wastes to be stored at WIPP. The Environmental 
Protection Agency and the National Academy of Sciences 
supported DOE's decision to switch from on-site testing to 
laboratory testing. Additionally, a U.S. General Accounting 
Office report completed in December of 1994 concluded that the 
DOE testing strategy was sound and would conclusively determine 
WIPP site suitability.

III. Steps to progress

    Operation of WIPP is a crucial step to the environmental 
remediation of TRU waste at facilities throughout the DOE 
weapons complex. The primary waste sites, along with currennt 
estimates of TRU wastes conntained at each site, are listed 
below:

------------------------------------------------------------------------
                                                          Waste volume  
                  DOE generator site                      (cubic feet)  
------------------------------------------------------------------------
Hanford Site, Washington.............................          2,693,000
Idaho National Engineering Laboratory, Idaho.........          1,232,000
Savannah River Plant, South Carolina.................          1,037,000
Los Alamos National Laboratory, New Mexico...........            661,000
Rocky Flats Site, Colorado...........................            248,000
Oak Ridge National Laboratory, Tennessee.............             84,000
Lawrence Livermore National Laboratory, California...             32,000
Nevada Test Site, Nevada.............................             22,000
Mound Laboratory, Ohio...............................              9,000
Argonne National Laboratory, Illinois................              1,000
------------------------------------------------------------------------

    As WIPP is to serve as the permanent repository for the TRU 
wastes at these and nine other sites with lesser waste volumes, 
the environmental remediation of these sites is dependent upon 
the opening of WIPP. Delays in opening the WIPP facility have 
contributed to a lack of movement on cleanup at these sites.
    Construction of WIPP was completed in 1991. Opening the 
facility has been delayed since that time by several factors, 
including certification of compliance with applicable 
environmental regulations by the U.S. Environmental Protection 
Agency. One issue of contention has been the applicability of 
regulations under the Solid Waste Disposal Act (42 U.S.C. 6901-
6991i) at WIPP. Currently, it is anticipated that WIPP will be 
subject to four major regulatory schemes: 40 CFR Part 191: 
Environmental Radiation Protection Standards for Management and 
Disposal of Spent Nuclear Fuel, High-Level and Transuranic 
Radioactive Wastes; 40 CFR Part 194: Criteria for the 
Certification and Determination of the Waste Isolation Pilot 
Plant's Compliance with Environmental Standards for the 
Management and Disposal of Spent Nuclear Fuel, High-Level and 
Transuranic Radioactive Wastes; 40 CFR Part 264: Standards for 
Owners and Operators of Hazardous Waste Treatment, Storage and 
Disposal Facilities; and 40 CFR Part 268: Land Disposal 
Restrictions. The overlapping regulatory restrictions of these 
requirements have contributed to the lack of progress in 
opening the repository, and pose the risk of substantial cost 
increases in operating the facility. According to the 
Department of Energy's own estimates, complying with the 
overlapping requirements of 40 CFR Part 268: Land Disposal 
Restrictions could add up to an additional $500 million in 
operating costs at WIPP over the life of the facility.
    As a result, the Subcommittee on Energy and Power focused 
particular attention on the requirements of 40 CFR Part 268, 
which govern land disposal restrictions and require that no 
migration of the waste involved will occur. According to DOE's 
testimony before the subcommittee, discontinuing the 
application of this requirement will not have a determinable 
impact on public health and safety at the facility. During 
questioning from Chairman Schaefer, DOE Carlsbad Area Office 
Manager George Dials stated:

          Mr. Chairman, it's our view that we don't necessarily 
        need the overlapping regulation. We feel that 
        compliance with both the 40 CFR 191, the radioactive 
        waste standard, and with the hazardous waste disposal 
        standard, 264, really should be sufficient from a 
        technical perspective to protect the health and safety 
        of the public or the environment * * *

Additionally, in correspondence to Senator Dirk Kempthorne 
dated September 8, 1995, EPA Assistant Administrator for Air 
and Radiation Mary Nichols and EPA Assistant Administrator for 
Solid Waste and Emergency Response Elliott Laws stated that:

          The Agency's view on whether a demonstration of no 
        migration of hazardous constituents from the WIPP 
        pursuant to RCRA Section 3004(d) would contribute any 
        significant additional protection of human health and 
        the environment is as follows: (1) The Agency believes 
        that the human health and environmental hazards 
        presented by the radioactive portion of the waste 
        outweigh the hazards presented by the RCRA hazardous 
        constituents portion of the waste; (2) The Agency also 
        believes that compliance with its comprehensive 
        regulatory scheme under the Atomic Energy Act (40 CFR 
        Part 191), the extensive WIPP Compliance Criteria (40 
        CFR Part 194), and RCRA permit requirements (40 CFR 
        264) will also adequately protect human health and the 
        environment from releases of RCRA hazardous 
        constituents.
          In this light, the Agency, therefore, believes that 
        in the narrow context of the WIPP, which is subject to 
        comprehensive regulation under the AEA, the WIPP LWA, 
        and RCRA, that a demonstration of no migration of 
        hazardous constituents will not be necessary to 
        adequately protect human health and the environment.

    With both principal agencies in agreement on the 
superfluous nature of the current regulatory structure, it is 
clear that removing unnecessary regulatory burdens would have a 
beneficial effect on opening WIPP and in ensuring a responsible 
use of taxpayer funding during WIPP's operation.
    The GAO report questioned DOE's assertion that it could 
open the facility by its announced January 1998 deadline, 
determining that a January 2000 opening was more likely. Since 
the release of the GAO report, DOE has revised its schedule for 
opening WIPP, anticipating a June 1998 opening for contact-
handled waste, and a post-2000 date for remotely handled TRU 
waste operation. With broad agreement that in-situ testing will 
not be necessary to make a site suitability determination, it 
is important to remove statutory hurdles related to in-situ 
testing.

                                Hearings

    The Energy and Power Subcommittee held a hearing on July 
21, 1995, to examine possible revisions to the Waste Isolation 
Pilot Plant Land Withdrawal Act proposed by Representative 
Skeen in H.R. 1663. Witnesses at the hearing included 
Representative Joe Skeen; Mr. George Dials, Manager, Carlsbad 
area office, U.S. Department of Energy; Ms. Ramona Travato, 
Director, Office of Radiation and Indoor Air, U.S. 
Environmental Protection Agency; Ms. Bernice Steinhardt, 
Associate Director, Energy and Science Issues, U.S. General 
Accounting Office; Ms. Jennifer Salisbury; secretary of energy, 
minerals and natural resources, State of New Mexico; Mr. 
Lindsay Lovejoy, attorney, office of the attorney general, 
State of New Mexico; The Honorable Gary Perkowski, mayor, city 
of Carlsbad; Mr. Don Hancock, director, nuclear waste safety 
project, Southwest Research and Information Center; and Mr. 
Stephen P. Winston, vice president for technical integration 
and mission development, Lockheed Martin.

                        Committee Consideration

    On July 28, 1995, the Subcommittee on Energy and Power met 
in open session to consider H.R. 1663, the Waste Isolation 
Pilot Plant Land Withdrawal Amendment Act. The subcommittee 
approved H.R. 1663 for full committee consideration, without 
amendment, by a voice vote, a quorum being present.
    On September 13, 1995, the committee met in open session 
and ordered subtitle D, the Waste Isolation Pilot Plant Land 
Withdrawal Amendment Act, transmitted to the House Committee on 
the Budget for inclusion in the fiscal year 1996 Omnibus Budget 
Reconciliation Act by a rollcall vote of 24 yeas to 12 nays.

                             Rollcall Votes

    Pursuant to clause 2(l)(2)(B) of rule XI of the Rules of 
the House of Representatives, following are listed the recorded 
votes on the motion to order subtitle D transmitted to the 
House Committee on the Budget and on amendments thereto, 
including the names of those members voting for and against.

                          rollcall vote no. 62

    Bill: Committee print entitled ``Waste Isolation Pilot 
Project.''
    Quorum Call: 26 members answered present.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........  ........         X   Mr. Dingell......  ........  ........         X 
Mr. Moorhead...................  ........  ........         X   Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........  ........         X   Mr. Markey.......  ........  ........         X 
Mr. Fields.....................  ........  ........  .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........  ........         X   Mr. Hall.........  ........  ........  .........
Mr. Bilirakis..................  ........  ........         X   Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........  ........         X   Mr. Boucher......  ........  ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......  ........  ........  .........
Mr. Hastert....................  ........  ........         X   Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........  ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........  ........         X   Mr. Pallone......  ........  ........         X 
Mr. Paxon......................  ........  ........  .........  Mr. Brown........  ........  ........         X 
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....  ........  ........         X 
Mr. Klug.......................  ........  ........         X   Mr. Gordon.......  ........  ........  .........
Mr. Franks.....................  ........  ........         X   Ms. Furse........  ........  ........         X 
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......  ........  ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........  ........  ........         X 
Mr. Cox........................  ........  ........  .........  Ms. Eshoo........  ........  ........         X 
Mr. Deal.......................  ........  ........  .........  Mr. Klink........  ........  ........         X 
Mr. Burr.......................  ........  ........         X   Mr. Stupak.......  ........  ........         X 
Mr. Bilbray....................  ........  ........         X                                                   
Mr. Whitfield..................  ........  ........         X                                                   
Mr. Ganske.....................  ........  ........         X                                                   
Mr. Frisa......................  ........  ........         X                                                   
Mr. Norwood....................  ........  ........  .........                                                  
Mr. White......................  ........  ........  .........                                                  
Mr. Coburn.....................  ........  ........         X                                                   
----------------------------------------------------------------------------------------------------------------

                          Rollcall Vote No. 67

    Bill: Committee print entitled ``Waste Isolation Pilot 
Project.''
    Amendment: Amendment by Mr. Pallone re: restore compliance 
with RCRA no-migration standards.
    Disposition: Not agreed to, by a rollcall vote of 15 yeas 
to 22 nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........        X   .........  Mr. Dingell......        X   ........  .........
Mr. Moorhead...................  ........  ........  .........  Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........        X   .........  Mr. Markey.......        X   ........  .........
Mr. Fields.....................  ........        X   .........  Mr. Wyden........        X   ........  .........
Mr. Oxley......................  ........        X   .........  Mr. Hall.........        X   ........  .........
Mr. Bilirakis..................  ........        X   .........  Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........        X   .........  Mr. Boucher......  ........        X   .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......        X   ........  .........
Mr. Hastert....................  ........        X   .........  Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........        X   .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........        X   .........  Mr. Pallone......        X   ........  .........
Mr. Paxon......................  ........  ........  .........  Mr. Brown........        X   ........  .........
Mr. Gillmor....................  ........        X   .........  Mrs. Lincoln.....        X   ........  .........
Mr. Klug.......................  ........  ........  .........  Mr. Gordon.......  ........  ........  .........
Mr. Franks.....................  ........        X   .........  Ms. Furse........        X   ........  .........
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......        X   ........  .........
Mr. Crapo......................  ........        X   .........  Mr. Rush.........        X   ........  .........
Mr. Cox........................  ........        X   .........  Ms. Eshoo........        X   ........  .........
Mr. Deal.......................  ........        X   .........  Mr. Klink........        X   ........  .........
Mr. Burr.......................  ........        X   .........  Mr. Stupak.......        X   ........  .........
Mr. Bilbray....................  ........        X   .........                                                  
Mr. Whitfield..................  ........        X   .........                                                  
Mr. Ganske.....................  ........        X   .........                                                  
Mr. Frisa......................  ........        X   .........                                                  
Mr. Norwood....................  ........        X   .........                                                  
Mr. White......................  ........        X   .........                                                  
Mr. Coburn.....................  ........        X   .........                                                  
----------------------------------------------------------------------------------------------------------------

                          rollcall vote no. 68

    Bill: Committee print entitled ``Waste Isolation Pilot 
Project.''
    Motion: Motion by Mr. Bliley to order the committee print 
entitled ``Waste Isolation Pilot Project'' transmitted to the 
Committee on the Budget for inclusion in the fiscal year 1996 
Omnibus Budget Reconciliation Act.
    Disposition: Agreed to, by a rollcall of 24 yeas to 12 
nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................        X   ........  .........  Mr. Dingell......  ........        X   .........
Mr. Moorhead...................        X   ........  .........  Mr. Waxman.......  ........        X   .........
Mr. Tauzin.....................        X   ........  .........  Mr. Markey.......  ........        X   .........
Mr. Fields.....................        X   ........  .........  Mr. Wyden........  ........        X   .........
Mr. Oxley......................        X   ........  .........  Mr. Hall.........        X   ........  .........
Mr. Bilirakis..................        X   ........  .........  Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................        X   ........  .........  Mr. Boucher......  ........  ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......  ........        X   .........
Mr. Hastert....................  ........  ........  .........  Mr. Towns........  ........  ........  .........
Mr. Upton......................        X   ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................        X   ........  .........  Mr. Pallone......  ........  ........  .........
Mr. Paxon......................        X   ........  .........  Mr. Brown........  ........        X   .........
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....        X   ........  .........
Mr. Klug.......................        X   ........  .........  Mr. Gordon.......  ........        X   .........
Mr. Franks.....................        X   ........  .........  Ms. Furse........  ........        X   .........
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......  ........        X   .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........        X   ........  .........
Mr. Cox........................  ........  ........  .........  Ms. Eshoo........  ........        X   .........
Mr. Deal.......................        X   ........  .........  Mr. Klink........  ........        X   .........
Mr. Burr.......................        X   ........  .........  Mr. Stupak.......  ........        X   .........
Mr. Bilbray....................        X   ........  .........                                                  
Mr. Whitfield..................        X   ........  .........                                                  
Mr. Ganske.....................        X   ........  .........                                                  
Mr. Frisa......................        X   ........  .........                                                  
Mr. Norwood....................        X   ........  .........                                                  
Mr. White......................        X   ........  .........                                                  
Mr. Coburn.....................        X   ........  .........                                                  
----------------------------------------------------------------------------------------------------------------

                              voice votes

    Bill: Committee print entitled ``Waste Isolation Pilot 
Project.''
    Amendment: Amendment by Mr. Markey re: strike the 
provisions removing EPA's certification authority.
    Disposition: Not agreed to, by a voice vote.

                      Committee Oversight Findings

    Pursuant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Subcommittee on Energy and 
Power held a legislative hearing and made findings that are 
reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the committee by the Committee on Government.

                        Committee Cost Estimate

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the committee believes that 
enactment of subtitle D would result in no additional costs to 
the Federal Government.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(c) of rule XI of the Rules of 
the House of Representatives, a letter from the congressional 
budget office providing a cost estimate for all six subtitles 
of Title III is found at the conclusion of title XVII of this 
bill.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee finds that subtitle D 
would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

Sec. 3045. Short Title and Reference

    The section states that the short title of this Act shall 
be the ``Waste Isolation Pilot Plant Land Withdrawal Amendment 
Act'' and provides that references in this Act, unless 
specified, are references to the Waste Isolation Pilot Plant 
Land Withdrawal Act (Public Law 102-579).

Sec. 3046. Definitions

    The section deletes definitions for ``test phase'' and 
``test phase activities''. With the repeal of test phase 
requirements currently in statute, no need for these 
definitions will exist.

Sec. 3047. Test phase and retrieval plans

    Section 3047 repeals Section 5 of Public Law 102-579, 
pertaining to test phase and retrieval plans. With the decision 
to forego in-situ testing, the section is no longer needed.

Sec. 3048. Test phase activities

    Section 6 of Public Law 102-579, which relates to 
requirements for the commencement of test phase activities, is 
repealed. The committee retains current provisions requiring 
studies of an analysis of the impact remote-handled waste will 
have on WIPP and an analysis of the long-term performance of 
the facility. These studies will be useful in assessing the 
safety and performance of WIPP.

Sec. 3049. Disposal operations

    The section eliminates Section 7(b) of Public Law 102-579, 
which requires completion of certain activities prior to the 
emplacement of waste at WIPP, including certification of the 
facility by the Environmental Protection Agency and completion 
of a survey of all TRU wastes at all generating sites.

Sec. 3050. Environmental Protection Agency disposal regulations

    This section eliminates EPA certification of the WIPP 
facility, and amends the mandatory requirement for use of both 
engineered and natural barriers to intrusion to a discretionary 
requirement for the Secretary. EPA retains an advisory role to 
DOE during the certification process. Additionally, the 
committee expects that EPA could have an ongoing regulatory 
role at the site under RCRA, the Clean Air Act, the Safe 
Drinking Water Act, the Toxic Substances Control Act, and any 
other applicable Federal law. The U.S. Mine Safety and Health 
Administration also retains regulatory oversight, as well as 
the State of New Mexico under RCRA.

Sec. 3051. Compliance with environmental laws and regulations

    The applicability of environmental statues is amended to 
eliminate RCRA ``no migration'' requirements (40 CFR Part 268). 
With the protections offered under parts 191, 194 and 264, the 
part 268 requirement is an overlapping regulatory mandate and 
is not necessary to protect human health and the environment.

Sec. 3052. Retrievability

    This section eliminates test phase retrievability 
requirements and replaces them with a new section requiring the 
Secretary to make a decision regarding use of the WIPP facility 
no later than March 31, 1997. Requirements relating to in-situ 
testing are not needed with the decision to utilize laboratory 
testing for a determination of site suitability.

Sec. 3053. Decommissioning of WIPP

    This section eliminates requirements for the Secretary to 
submit a plan for the decommissioning of WIPP by 1997, while 
retaining the requirement for the Secretary to develop such a 
plan. The decommissioning plan is not integral to the 
commencement of operations at WIPP.

Sec. 3054. Economic assistance and miscellaneous payments

    The limitation on assistance to the State of New Mexico is 
eliminated, and replaced with the requirement that the benefits 
schedule established under the Act commence on the date of 
enactment of this act. This will ensure that funding for needed 
infrastructure improvements in the State of New Mexico is made 
available in a timely manner.

Sec. 3055. Non-defense waste

    This provision allows the Secretary to accept TRU waste 
from non-defense activities. Such waste comprises a very 
limited percentage of the total amount of TRU waste, and WIPP 
is the only facility presently capable of handling such 
material for permanent disposal.

               Changes in Existing Law Made by Subtitle D

    The changes in existing law made by subtitle D are included 
at the conclusion of the report of this title of the bill.

                  Subtitle E--Naval Petroleum Reserves

                          Purpose and Summary

    The purpose of subtitle E is to privatize the Naval 
Petroleum Reserves [NPR], including the Naval Oil Shale 
Reserves [NOSR]. This legislation directs the Secretary of 
Energy to sell, by December 31, 1996, all of the United States' 
interest in the Naval Petroleum Reserves.

                  Background and Need for Legislation

    The Naval Petroleum Reserves, which include the Naval Oil 
Shale Reserves, were established early in the 1900's to ensure 
fuel supplies for the military. The Naval Petroleum Reserves 
consist of three oil reserve properties and three oil shale 
properties. Naval Petroleum Reserve No. 1 [NPR-1] is located at 
Elk Hills in Kern County, CA and is the most valuable of these 
reserves. NPR-1 is one of the 10 largest oil fields in the 
United States and produces approximately 66,000 barrels of oil 
per day. The bulk of the Elk Hills filed, 78 percent, is owned 
by the U.S. Government. The remaining 22 percent is owned by 
Chevron. Naval Petroleum Reserve No. 2 is located at Buena 
Vista Hills, CA, and is adjacent to Naval Petroleum Reserve No. 
1. The United States owns 34.6 percent of Naval Petroleum 
Reserve No. 2, and the remainder is privately owned. Naval 
Petroleum Reserve No. 3, Teapot Dome, WY, is owned entirely by 
the Federal Government. Naval Oil Shale Reserves No. 1 and No. 
3 are adjacent oil shale reserves located west of Rifle, CO, in 
Garfield County. Except for small private oil shale claims at 
Naval Oil Shale Reserve No. 1, all lands and minerals at Naval 
Oil Shale Reserve Nos. 1 and 3 are Federally owned. Naval Oil 
Shale Reserve No. 2 is located in Carbon and Uintah Counties, 
UT. All of the minerals at this reserve are owned by the United 
States except for those contained on States lands and homestead 
entries.
    Despite their designation as Naval Petroleum Reserves, 
these reserves have never been used to supply oil to the 
military. In fact, it wasn't until the Arab oil embargo of 1973 
that significant commercial production of the fields began. The 
national defense purpose of these reserves no longer exists. 
The Department of Defense has stated that it does not require 
the reserves for defense purposes. From a readiness standpoint, 
a military emergency would require procurement and immediate 
distribution of refined products such as aviation fuel, not 
crude oil.
    Since 1976, the fields have generated $12.8 billion in 
revenues for the U.S. Treasury. However, the fields are now in 
decline. For example, Naval Petroleum Reserve No. 1 reached its 
peak rate of oil production of 181,000 barrels of oil per day 
in July 1981. In September, 1993, it was producing 
approximately 66,000 barrels of oil per day. Over the past six 
years, net revenues from the reserves have declined over 45 
percent. Further, the Department of Energy projects that 
hydrocarbon revenues will continue to decline and expenses to 
operate the field will continue to increase. As the most 
prolific oil-bearing reservoirs are being depleted, costs to 
extract the oil from the ground are increasing, and market 
prices for hydrocarbons are stable or declining, this resource 
will become less valuable to the United States.
    In addition, the Department of Energy is no longer able to 
make the necessary investments in these fields to produce them 
efficiently. Since the Federal Government is not in the 
business of making money, it is not able to operate the 
reserves as a private owner would. When requesting funds to 
operate there serves, the Department of Energy must balance 
that request with competing programs. This has limited the 
Department's ability to make capital investments in the 
reserves that would have been routine for the private sector. 
For example, a private owner is able to reinvest its annual 
revenues to improve operations and enhance profitability. By 
contrast, revenues from the reserves are deposited into the 
U.S. Treasury, and DOE must rely on the appropriations process 
for funding.
    Similary, a private owner can respond quickly to take 
advantage of changing markets and make long-term plans for the 
development of oil properties. The lengthy Federal budget 
process precludes both rapid decision-making and, because of 
the unpredictability of the budget, it is difficult to 
guarantee funding for longer term capital investments. Thus, 
the Department of Energy does not have the ability to operate 
these fields in the most profitable manner. These shortcomings 
will only become more severe as the expenses at these fields go 
up and the Federal budget becomes smaller.
    That the U.S. Government has been a poor operator of the 
reserves is obvious. For example, private oil companies in 
California employ an average of 17 workers for every 100 wells, 
compared with over 50 workers per 100 wells for Bechtel, the 
government contract operator of Elk Hills. Likewise, at the 
Naval Oil Shale Reserves between 1977 and 1993, the Federal 
Government has spent $30,759,929.00. During that same time 
period, revenues from the Naval Oil Shale Reserves was 
$8,540,770.00. Clearly this has not been a cost-effective 
operation.
    Sections 3071 and 3072 of Subtitle E get the Federal 
Government out of the oil business. This makes sense for 
several reasons. One, being in business is an inappropriate 
role for government and it is clear that the government, once 
in business, has proven to have very poor business judgment. 
Two, revenue from privatization of the reserves can be used to 
reduce the Federal deficit. The reserves are a valuable asset 
of the U.S. Government and should be sold for their maximum 
value. Current market conditions are favorable for such a sale 
because there is currently a positive outlook for commodity 
prices, favorable liquidity and access to capital among 
prospective purchasers, and a limited supply of comparable 
properties for sale. In addition, subtitle E requires a sale 
through a competitive bidding process, requires independent 
valuation of the assets, and gives the Secretary of Energy the 
flexibility to package the sale in a manner that will result in 
the highest return to the Federal Government.
    Finally, it is important to note that the NPR and the NOSR 
are not emergency reserves designed to mitigate negative 
impacts caused by disruptions in oil supplies in the same way 
that the Strategic Petroleum Reserve is intended. Since 
Congress authorized its production in 1976, the reserves 
changed from being a strategic energy reserve for the military 
to a source of oil for the U.S. economy and a revenue raiser 
for the Federal Government. Basically, the Naval Petroleum and 
Oil Shale Reserves are oil and gas fields owned by the Federal 
Government from which oil and gas are produced and sold on the 
open market just as if the fields were privately owned.

                                Hearings

    The Subcommittee on Energy and Power held an oversight 
hearing on the Privatization of the Naval Petroleum Reserves on 
September 8, 1995. Testifying at that hearing were: Patricia 
Fry Godley, Assistant Secretary for Fossil Energy, Department 
of Energy; Mike Stay, Program Director for Elk Hills, Chevron; 
Rodman Patton, Managing Director, Merrill Lynch and Co.; Edwin 
Rothschild, Energy Policy Director, Citizen Action; and Albert 
G. Boyce, President, California Independent Petroleum 
Association.

                        Committee Consideration

    On September 13, 1995, the committee met in open session 
and ordered subtitle E transmitted to the House Committee on 
the Budget for inclusion in the fiscal year 1996 Omnibus Budget 
Reconciliation Act, as amended, by a voice vote, a quorum being 
present.

                             Rollcall Votes

    Pursuant to clause 2(l)(2)(B) of rule XI of the Rules of 
the House of Representatives, following are listed the recorded 
votes on the motion to order subtitle E transmitted to the 
House Committee on the Budget, and on amendments thereto, 
including the names of those members voting for and against.

                          rollcall vote no. 62

    Bill: Committee print entitled ``Naval Petroleum 
Reserves.''
    Quorum call: 26 members answered present.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........  ........         X   Mr. Dingell......  ........  ........         X 
Mr. Moorhead...................  ........  ........         X   Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........  ........         X   Mr. Markey.......  ........  ........         X 
Mr. Fields.....................  ........  ........  .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........  ........         X   Mr. Hall.........  ........  ........  .........
Mr. Bilirakis..................  ........  ........         X   Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........  ........         X   Mr. Boucher......  ........  ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......  ........  ........  .........
Mr. Hastert....................  ........  ........         X   Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........  ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........  ........         X   Mr. Pallone......  ........  ........         X 
Mr. Paxon......................  ........  ........  .........  Mr. Brown........  ........  ........         X 
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....  ........  ........         X 
Mr. Klug.......................  ........  ........         X   Mr. Gordon.......  ........  ........  .........
Mr. Franks.....................  ........  ........         X   Ms. Furse........  ........  ........         X 
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......  ........  ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........  ........  ........         X 
Mr. Cox........................  ........  ........  .........  Ms. Eshoo........  ........  ........         X 
Mr. Deal.......................  ........  ........  .........  Mr. Klink........  ........  ........         X 
Mr. Burr.......................  ........  ........         X   Mr. Stupak.......                               
Mr. Bilbray....................  ........  ........         X                                                   
Mr. Whitfield..................  ........  ........         X                                                   
Mr. Ganske.....................  ........  ........         X                                                   
Mr. Frisa......................  ........  ........         X                                                   
Mr. Norwood....................  ........  ........  .........                                                  
Mr. White......................  ........  ........  .........                                                  
Mr. Coburn.....................  ........  ........         X                                                   
----------------------------------------------------------------------------------------------------------------

                          rollcall vote no. 64

    Bill: Committee print entitled ``Naval Petroleum 
Reserves.''
    Amendment: Amendment by Mr. Klug re: set aside 7 percent of 
the proceeds of the sale of the California reserve into an 
escrow account until a settlement is reached between the 
Federal Government and the State of California.
    Disposition: Agreed to, by a roll call vote of 21 yeas to 
18 nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........        X   .........  Mr. Dingell......  ........  ........  .........
Mr. Moorhead...................  ........        X   .........  Mr. Waxman.......  ........  ........         X 
Mr. Tauzin.....................        X   ........  .........  Mr. Markey.......        X   ........  .........
Mr. Fields.....................  ........        X   .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........        X   .........  Mr. Hall.........        X   ........  .........
Mr. Bilirakis..................  ........        X   .........  Mr. Bryant.......        X   ........  .........
Mr. Schaefer...................  ........        X   .........  Mr. Boucher......        X   ........  .........
Mr. Barton.....................  ........        X   .........  Mr. Manton.......        X   ........  .........
Mr. Hastert....................  ........        X   .........  Mr. Towns........  ........  ........  .........
Mr. Upton......................        X   ........  .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........        X   .........  Mr. Pallone......        X   ........  .........
Mr. Paxon......................  ........        X   .........  Mr. Brown........        X   ........  .........
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....        X   ........  .........
Mr. Klug.......................        X   ........  .........  Mr. Gordon.......        X   ........  .........
Mr. Franks.....................  ........        X   .........  Ms. Furse........        X   ........  .........
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......        X   ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........        X   ........  .........
Mr. Cox........................  ........        X   .........  Ms. Eshoo........  ........        X   .........
Mr. Deal.......................        X   ........  .........  Mr. Klink........  ........        X   .........
Mr. Burr.......................        X   ........  .........  Mr. Stupak.......        X   ........  .........
Mr. Bilbray....................  ........        X   .........                                                  
Mr. Whitfield..................  ........        X   .........                                                  
Mr. Ganske.....................        X   ........  .........                                                  
Mr. Frisa......................  ........        X   .........                                                  
Mr. Norwood....................        X   ........  .........                                                  
Mr. White......................  ........        X   .........                                                  
Mr. Coburn.....................  ........  ........  .........                                                  
----------------------------------------------------------------------------------------------------------------

                          rollcall vote no. 65

    Bill: Committee print entitled ``Naval Petroleum 
Reserves.''
    Amendment: Amendment by Mr. Markey re: permit termination 
of the unit plan agreement prior to or at the time of sale or 
transfer.
    Disposition: Not agreed to, by a rollcall vote of 15 yeas 
to 24 nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........        X   .........  Mr. Dingell......        X   ........  .........
Mr. Moorhead...................  ........  ........  .........  Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........        X   .........  Mr. Markey.......        X   ........  .........
Mr. Fields.....................  ........        X   .........  Mr. Wyden........  ........  ........  .........
Mr. Oxley......................  ........        X   .........  Mr. Hall.........  ........        X   .........
Mr. Bilirakis..................  ........        X   .........  Mr. Bryant.......        X   ........  .........
Mr. Schaefer...................  ........        X   .........  Mr. Boucher......        X   ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......        X   ........  .........
Mr. Hastert....................  ........        X   .........  Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........        X   .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........        X   .........  Mr. Pallone......        X   ........  .........
Mr. Paxton.....................  ........        X   .........  Mr. Brown........        X   ........  .........
Mr. Gillmor....................  ........        X   .........  Mrs. Lincoln.....        X   ........  .........
Mr. Klug.......................  ........        X   .........  Mr. Gordon.......        X   ........  .........
Mr. Franks.....................  ........        X   .........  Ms. Furse........        X   ........  .........
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......        X   ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........        X   ........  .........
Mr. Cox........................  ........        X   .........  Ms. Eshoo........        X   ........  .........
Mr. Deal.......................  ........        X   .........  Mr. Klink........        X   ........  .........
Mr. Burr.......................  ........        X   .........  Mr. Stupak.......        X   ........  .........
Mr. Bilbray....................  ........        X   .........                                                  
Mr. Whitfield..................  ........        X   .........                                                  
Mr. Ganske.....................  ........        X   .........                                                  
Mr. Frisa......................  ........        X   .........                                                  
Mr. Norwood....................  ........        X   .........                                                  
Mr. White......................  ........        X   .........                                                  
Mr. Coburn.....................  ........        X   .........                                                  
----------------------------------------------------------------------------------------------------------------

                          ROLLCALL VOTE NO. 66

    Bill: Committee print entitled ``Naval Petroleum 
Reserves.''
    Amendment: Amendment by Mr. Brown re: give the Department 
of Energy and the Office of Management and Budget authority to 
stop the sale if certain conditions are not met.
    Disposition: Not agreed to, by a rollcall vote of 15 yeas 
to 21 nays.

----------------------------------------------------------------------------------------------------------------
         Representative            Yeas      Nays     Present     Representative     Yeas      Nays     Present 
----------------------------------------------------------------------------------------------------------------
Mr. Bliley.....................  ........        X   .........  Mr. Dingell......        X   ........  .........
Mr. Moorhead...................  ........  ........  .........  Mr. Waxman.......  ........  ........  .........
Mr. Tauzin.....................  ........        X   .........  Mr. Markey.......        X   ........  .........
Mr. Fields.....................  ........        X   .........  Mr. Wyden........        X   ........  .........
Mr. Oxley......................  ........        X   .........  Mr. Hall.........  ........  ........  .........
Mr. Bilirakis..................  ........        X   .........  Mr. Bryant.......  ........  ........  .........
Mr. Schaefer...................  ........        X   .........  Mr. Boucher......        X   ........  .........
Mr. Barton.....................  ........  ........  .........  Mr. Manton.......        X   ........  .........
Mr. Hastert....................  ........        X   .........  Mr. Towns........  ........  ........  .........
Mr. Upton......................  ........        X   .........  Mr. Studds.......  ........  ........  .........
Mr. Stearns....................  ........  ........  .........  Mr. Pallone......        X   ........  .........
Mr. Paxon......................  ........        X   .........  Mr. Brown........        X   ........  .........
Mr. Gillmor....................  ........  ........  .........  Mrs. Lincoln.....        X   ........  .........
Mr. Klug.......................  ........        X   .........  Mr. Gordon.......        X   ........  .........
Mr. Franks.....................  ........        X   .........  Ms. Furse........        X   ........  .........
Mr. Greenwood..................  ........  ........  .........  Mr. Deutsch......        X   ........  .........
Mr. Crapo......................  ........  ........  .........  Mr. Rush.........        X   ........  .........
Mr. Cox........................  ........        X   .........  Ms. Eshoo........        X   ........  .........
Mr. Deal.......................  ........        X   .........  Mr. Klink........        X   ........  .........
Mr. Burr.......................  ........        X   .........  Mr. Stupak.......        X   ........  .........
Mr. Bilbray....................  ........        X   .........                                                  
Mr. Whitfield..................  ........        X   .........                                                  
Mr. Ganske.....................  ........        X   .........                                                  
Mr. Frisa......................  ........        X   .........                                                  
Nr. Norwood....................  ........        X   .........                                                  
Mr. White......................  ........        X   .........                                                  
Mr. Coburn.....................  ........        X   .........                                                  
----------------------------------------------------------------------------------------------------------------

           Committee on Commerce--104th Congress--Voice Votes

    Bill: Committee print entitled ``Naval Petroleum 
Reserves.''
    Amendment: Amendment by Mr. Schaefer re: extend the date 
for the Secretary of Energy to finalize the sale of the Naval 
Petroleum Reserves.
    Disposition: Agreed to, by a voice vote.
    Amendment: Amendment by Mr. Dingell re: eliminate 
provisions which held purchasers harmless from claims or 
liability resulting from U.S. ownership of property.
    Disposition: Withdrawn, by unanimous consent.
    Motion: Motion by Mr. Bliley to order the committee print 
entitled ``Naval Petroleum Reserves,'' as amended, transmitted 
to the Committee on the Budget for inclusion in the fiscal year 
1996 Omnibus Budget Reconciliation Act.
    Disposition: Agreed to, by a voice vote.

                      Committee Oversight Findings

    Purusant to clause 2(l)(3)(A) of rule XI of the Rules of 
the House of Representatives, the Subcommittee on Energy and 
Power held an oversight hearing and made findings that are 
reflected in this report.

              Committee on Government Reform and Oversight

    Pursuant to clause 2(l)(3)(D) of rule XI of the Rules of 
the House of Representatives, no oversight findings have been 
submitted to the committee by the Committee on Government 
Reform and Oversight.

                        Committee Cost Estimate

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the committee believes that 
enactment of subtitle E would result in no additional costs to 
the Federal Government.

                  Congressional Budget Office Estimate

    Pursuant to clause 2(l)(3)(C) of rule XI of the Rules of 
the House of Representatives, a letter from the Congressional 
Budget Office providing a cost estimate for all six subtitles 
of title III is found at the conclusion of title XVII of this 
bill.

                     Inflationary Impact Statement

    Pursuant to clause 2(l)(4) of rule XI of the Rules of the 
House of Representatives, the committee finds that subtitle E 
would have no inflationary impact.

             Section-by-Section Analysis of the Legislation

    Section 3071 of subtitle E provides that the short title of 
the subtitle is the Naval Petroleum Reserve Privatization Act 
of 1995.
    Section 3072 adds a new subsection which provides for sale 
of the reserves to the highest bidder by December 31, 1996. In 
order to ensure that maximum value is received for the 
reserves, subsection (b) provides that by January 1, 1996, five 
independent oil and gas valuation experts shall be hired by the 
Secretary of Energy to conduct separate assessments of the fair 
market value of the United States' interest in the reserves. 
Equipment and facilities located on the reserves shall be 
included in the valuation. The experts are also directed to 
value the net present value of the anticipated revenue stream 
the Treasury would receive from the reserve if it was not sold, 
adjusted for any anticipated increase in tax revenues which 
could result from the sale.
    The independent experts' valuations are to be completed not 
later than July 1, 1996, and the Secretary of Energy shall set 
a minimum acceptable price for each reserve based on the 
average of the valuations. The Secretary is also directed to 
hire an investment banker no later than March 1, 1996, to 
administer the sale and assure that the sale is conducted in a 
manner that maximizes return to the Federal treasury. The 
investment banker is directed to complete a draft contract for 
the sale of each reserve which shall be included in the 
invitation for bids.
    The Secretary shall invite bids for the purchase of the 
reserves not later than September 1, 1996, and shall accept the 
highest responsible offer (that meets the minimum acceptable 
bid) not later than November 1, 1996. Importantly, subtitle E 
allows the Secretary to accept an offer for only a portion of a 
reserve as long as the entire reserve is still sold at the 
price that meets or exceeds the minimum acceptable price. Under 
subsection (c), the United States shall hold purchasers 
harmless for claims arising as a result of ownership in the 
reserve by the United States.
    Subsection (d) provides that by June 1, 1996, the Secretary 
shall finalize equity interests in NPR-1. The Secretary is 
directed to retain an independent petroleum engineer mutually 
acceptable to the equity owners to prepare a recommendation on 
final equity figures. If the equity redetermination is not 
resolved by the effective date of the subsection, the dispute 
shall be resolved in the manner provided by the unit plan 
contract.
    Subsection (e) of section 3072 preserves the current 25 
percent set aside for small refiners for use in their 
refineries. Thus, whoever purchases NPR-1 would have to offer 
up to 25 percent of petroleum produced from the reserve for 
purchase by small refiners. None of the reserved production 
sold to small refiners may be resold in kind. In addition, the 
seller of the petroleum has the right to refuse bids that are 
less than the prevailing market price of comparable oil.
    Subsection (f) provides that NPR-1 shall continue to be 
operated at the maximum daily oil or gas rate until the sale is 
completed. With respect to NPR-1, subsection (g) provides that 
contracts for purchase of petroleum shall remain in effect up 
to 3 months after the closing date of the sale. Contracts 
entered into after enactment of this legislation shall not 
exceed the anticipated closing date for the sale of the 
reserve. Subsection (g) also gives the Secretary the authority 
to terminate the operating contract between the Department and 
Bechtel at NPR-1. The unit plan contract is also terminated 
with the closing of the sale of NPR-1.
    Subsection (h) provides for 7 percent of the sale proceeds 
from the sale to be placed in an escrow account to be paid to 
the California Teachers Retirement Fund in the event the fund 
is successful in its claim for a portion of the revenues from 
the sale. Although the California Teachers Retirement Fund lost 
a litigation claim to a portion of the proceeds from the NPR-1 
while it was in Federal control, the State of California plans 
to revive its suit if the reserve is to be sold into the 
private sector.
    Subsection (i) makes it clear that subtitle E does not 
alter the application of the antitrust laws to the purchaser(s) 
of the reserves. Subsection (j) clarifies that subtitle E does 
not adversely impact the ownership interests any other entities 
have in the reserves. Finally, subsection (k) provides that the 
Secretary shall not enter into a contract for the sale of the 
reserves until 15 days after the Secretary notifies the House 
Commerce and National Security Committees and the Senate Armed 
Services Committee.

               Changes in Existing Law Made by Subtitle E

    The changes in existing law made by subtitle E are included 
at the conclusion of the report of this title of the bill.

   Changes in Existing Law Made by Title III of the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                       COMMUNICATIONS ACT OF 1934

          * * * * * * *

                      Title I--General Provisions

          * * * * * * *

SEC. 4. PROVISIONS RELATING TO THE COMMISSION.

  (a) * * *
          * * * * * * *
  (f)(1) The Commission shall have authority, subject to the 
provisions of the civil-service laws and the Classification Act 
of 1949, as amended, to appoint such officers, engineers, 
accountants, attorneys, inspectors, examiners, and other 
employees as are necessary in the exercise of its functions. 
The Commission may also procure the services of experts and 
consultants in accordance with section 3109 of title 5, United 
States Code, relating to appointments in the Federal Service, 
at rates of compensation for individuals not to exceed the 
daily rate equivalent to the maximum rate payable for senior-
level positions under section 5276 of title 5, United States 
Code.
          * * * * * * *
  (3) The Commission shall fix a reasonable rate of extra 
compensation for overtime services of engineers in charge and 
radio engineers of the Field Engineering and Monitoring Bureau 
of the Federal Communications Commission, who may be required 
to remain on duty between the hours of 5 o'clock postmeridian 
and 8 o'clock antemeridian or on Sundays or holidays to perform 
services in connection with the inspection of ship radio 
equipment and apparatus for the purposes of part II of title 
III of this Act or the Great Lakes Agreement, on the basis of 
one-half day's additional pay for each two hours or fraction 
thereof of at least one hour that the overtime extends beyond 5 
o'clock postmeridian (but not to exceed two and one-half days' 
pay for the full period from 5 o'clock postmeridian to 8 
o'clock antemeridian) and two additional days' pay for Sunday 
or holiday duty. The said extra compensation for overtime 
services shall be paid by the master, owner, or agent of such 
vessel to the local United States collector of customs or his 
representative, who shall deposit such collection into the 
Treasury of the United States to an appropriately designated 
receipt account: Provided, That the amounts of such collections 
received by the said collector of customs or his 
representatives shall be covered into the Treasury as 
miscellaneous receipts; and the payments of such extra 
compensation to the several employees entitled thereto shall be 
made from the annual appropriations for salaries and expenses 
of the Commission: Provided further, That to the extent that 
the annual appropriations which are hereby authorized to be 
made from the general fund of the Treasury are insufficient, 
there are hereby authorized to be appropriated from the general 
fund of the Treasury such additional amounts as may be 
necessary to the extent that the amounts of such receipts are 
in excess of the amounts appropriated: Provided further, That 
such extra compensation shall be paid if such field employees 
have been ordered to report for duty and have so reported 
whether the actual inspection of the radio equipment or 
apparatus takes place or not: And provided further, That in 
those ports where customary working hours are other than those 
hereinabove mentioned, the engineers in charge are vested with 
authority to regulate the hours of such employees so as to 
agree with prevailing working hours in said ports where 
inspections are to be made, but nothing contained in this 
proviso shall be construed in any manner to alter the length of 
a working day for the engineers in charge and radio engineers 
or the overtime pay herein fixed: And provided further, That, 
in the alternative, an entity designated by the Commission may 
make the inspections referred to in this paragraph.
          * * * * * * *
  (g)(1) * * *
  [(2)(A) If--
          [(i) the necessary expenses specified in the last 
        sentence of paragraph (1) have been incurred for the 
        purpose of enabling commissioners or employees of the 
        Commission to attend and participate in any convention, 
        conference, or meeting;
          [(ii) such attendance and participation are in 
        furtherance of the functions of the Commission; and
          [(iii) such attendance and participation are 
        requested by the person sponsoring such convention, 
        conference, or meeting;
then the Commission shall have authority to accept direct 
reimbursement from such sponsor for such necessary expenses.
  [(B) The total amount of unreimbursed expenditures made by 
the Commission for travel for any fiscal year, together with 
the total amount of reimbursements which the Commission accepts 
under subparagraph (A) for such fiscal year, shall not exceed 
the level of travel expenses appropriated to the Commission for 
such fiscal year.
  [(C) The Commission shall submit to the appropriate 
committees of the Congress, and publish in the Federal 
Register, quarterly reports specifying reimbursements which the 
Commission has accepted under this paragraph.
  [(D) The provisions of this paragraph shall cease to have any 
force or effect at the end of fiscal year 1994.
  [(E) Funds which are received by the Commission as 
reimbursements under the provisions of this paragraph after the 
close of a fiscal year shall remain available for obligation.]
  (2) The Commission shall submit to the appropriate committees 
of Congress, and publish in the Federal Register, semiannual 
reports specifying the reimbursements which the Commission has 
accepted under section 1353 of title 31, United States Code.
          * * * * * * *

SEC. 5. ORGANIZATION AND FUNCTIONING OF THE COMMISSION.

  (a) * * *
          * * * * * * *
  (c)(1) When necessary to the proper functioning of the 
Commission and the prompt and orderly conduct of its business, 
the Commission may, by published rule or by order, delegate any 
of its functions (except functions granted to the Commission by 
this paragraph and by paragraphs (4), (5), and (6) of this 
subsection and except any action referred to in sections 
204(a)(2), 208(b), and 405(b)) to a panel of commissioners, an 
individual commissioner, an employee board, or an individual 
employee, including functions with respect to hearing, 
determining, ordering, certifying, reporting, or otherwise 
acting as to any work, business, or matter; except that in 
delegating review functions to employees in cases of 
adjudication (as defined in the Administrative Procedure Act), 
the delegation in any such case may be made only to an employee 
board consisting of two or more employees referred to in 
paragraph (8). Any such rule or order may be adopted, amended, 
or rescinded only by a vote of a majority of the members of the 
Commission then holding office. [Nothing in this paragraph 
shall authorize the Commission to provide for the conduct, by 
any person or persons other than persons referred to in clauses 
(2) and (3) of section 7(a) of the Administrative Procedure 
Act, of any hearing to which such section 7(a) applies.] Except 
for cases involving the authorization of service in the 
Instructional Television Fixed Service, or as otherwise 
provided in this Act, nothing in this paragraph shall authorize 
the Commission to provide for the conduct, by any person or 
persons other than persons referred to in paragraph (2) or (3) 
of section 556(b) of title 5, United States Code, of any 
hearing to which such section applies.
          * * * * * * *

[SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

  [(a) There are authorized to be appropriated for the 
administration of this Act by the Commission $109,831,000 for 
fiscal year 1990 and $119,831,000 for fiscal year 1991, 
together with such sums as may be necessary for increases 
resulting from adjustments in salary, pay, retirement, other 
employee benefits required by law, and other nondiscretionary 
costs, for each of the fiscal years 1990 and 1991.
  [(b) In addition to the amounts authorized to be appropriated 
under this section, not more than 4 percent of the amount of 
any fees or other charges payable to the United States which 
are collected by the Commission during fiscal year 1990 are 
authorized to be made available to the Commission until 
expended to defray the fully distributed costs of such fees 
collection.
  [(c) Of the amounts appropriated pursuant to subsection (a) 
for fiscal year 1991, such sums as may be necessary not to 
exceed $2,000,000 shall be expended for upgrading and 
modernizing equipment at the Commission's electronic emissions 
test laboratory located in Laurel, Maryland.
  [(d) Of the sum appropriated in any fiscal year under this 
section, a portion, in an amount determined under section 9(b), 
shall be derived from fees authorized by section 9.]

SEC. 6. AUTHORIZATION OF APPROPRIATIONS.

  There are authorized to be appropriated for the 
administration of this Act by the Commission $186,000,000 for 
fiscal year 1996, together with such sums as may be necessary 
for increases resulting from adjustments in salary, pay, 
retirement, other employee benefits required by law, and other 
nondiscretionary costs, for fiscal year 1996. Of the sum 
appropriated in each fiscal year under this section, a portion, 
in an amount determined under sections 8(b) and 9(b), shall be 
derived from fees authorized by sections 8 and 9.
          * * * * * * *

SEC. 8. APPLICATION FEES.

  (a) The Commission shall assess and collect application fees 
at such rates as the Commission shall establish or at such 
modified rates as it shall establish pursuant to the provisions 
of subsection (b) of this section.
  [(b)(1) The Schedule of Application Fees established under 
this section shall be reviewed by the Commission every two 
years after October 1, 1991, and adjusted by the Commission to 
reflect changes in the Consumer Price Index. Increases or 
decreases in application fees shall apply to all categories of 
application fees, except that individual fees shall not be 
adjusted until the increase or decrease, as determined by the 
net change in the Consumer Price Index since the date of 
enactment of this section, amounts to at least $5.00 in the 
case of fees under $100.00, or 5 percent in the case of fees of 
$100.00 or more. All fees which require adjustment will be 
rounded upward to the next $5.00 increment. The Commission 
shall transmit to the Congress notification of any such 
adjustment not later than 90 days before the effective date of 
such adjustment.
  [(2) Increases or decreases in application fees made pursuant 
to this subsection shall not be subject to judicial review.]
  (b)(1) For fiscal year 1996 and each fiscal year thereafter, 
the Commission shall, by regulation, modify the application 
fees by proportionate increases or decreases so as to result in 
estimated total collections for the fiscal year equal to--
          (A) $40,000,000; plus
          (B) an additional amount, specified in an 
        appropriation Act for the Commission for that fiscal 
        year to be collected and credited to such 
        appropriation, not to exceed the amount by which the 
        necessary expenses for the costs described in paragraph 
        (5) exceeds $40,000,000.
  (2) In making adjustments pursuant to this paragraph the 
Commission may round such fees to the nearest $5.00 in the case 
of fees under $100, or to the nearest $20 in the case of fees 
of $100 or more. The Commission shall transmit to the Congress 
notification of any adjustment made pursuant to this paragraph 
immediately upon the adoption of such adjustment.
  (3) The Commission is authorized to continue to collect fees 
at the prior year's rate until the effective date of fee 
adjustments or amendments made pursuant to paragraphs (1) and 
(4).
  (4) The Commission shall, by regulation, add, delete, or 
reclassify services, categories, applications, or other filings 
subject to application fees to reflect additions, deletions, or 
changes in the nature of its services or authorization of 
service processes as a consequence of Commission rulemaking 
proceedings or changes in law.
  (5) Any modified fees established under paragraph (4) shall 
be derived by determining the full-time equivalent number of 
employees performing application activities, adjusted to take 
into account other expenses that are reasonably related to the 
cost of processing the application or filing, including all 
executive and legal costs incurred by the Commission in the 
discharge of these functions, and other factors that the 
Commission determines are necessary in the public interest. The 
Commission shall--
          (A) transmit to the Congress notification of any 
        proposed modification made pursuant to this paragraph 
        immediately upon adoption of such proposal; and
          (B) transmit to the Congress notification of any 
        modification made pursuant to this paragraph 
        immediately upon adoption of such modification.
  (6) Increases or decreases in application fees made pursuant 
to this subsection shall not be subject to judicial review.
          * * * * * * *
  [(e) Moneys received from application fees established under 
this section shall be deposited in the general fund of the 
Treasury to reimburse the United States for amounts 
appropriated for use by the Commission in carrying out its 
functions under this Act.]
  (e) Of the moneys received from fees authorized under this 
section--
          (1) $40,000,000 shall be deposited in the general 
        fund of the Treasury to reimburse the United States for 
        amounts appropriated for use by the Commission in 
        carrying out its functions under this Act; and
          (2) the remainder shall be deposited as an offsetting 
        collection in, and credited to, the account providing 
        appropriations to carry out the functions of the 
        Commission.
          * * * * * * *
  (g) Until modified pursuant to subsection (b) of this 
section, the Schedule of Application Fees which the Federal 
Communications Commission shall prescribe pursuant to 
subsection (a) of this section shall be as follows:

                      SCHEDULE OF APPLICATION FEES

Service
                                                              Fee amount

                          PRIVATE RADIO SERVICES

1. Marine Coast Stations
          * * * * * * *
11. Amateur vanity call signs
                                                                 150.00 
          * * * * * * *

                          COMMON CARRIER SERVICES

1. All Common Carrier Services
          * * * * * * *
22. Low-Earth Orbit Satellite Systems
          * * * * * * *
23. Personal communications services
    a. Initial or new application.............................   230.00 
    b. Amendment to pending application.......................    35.00 
    c. Application for assignment or transfer of control......   230.00 
    d. Application for renewal of license.....................    35.00 
    e. Request for special temporary authority................   200.00 
    f. Notification of completion of construction.............    35.00 
    g. Request to combine service areas.......................    50.00 
          * * * * * * *

SEC. 9. REGULATORY FEES.

  (a) General Authority.--
          (1) Recovery of costs.--The Commission, in accordance 
        with this section, shall assess and collect regulatory 
        fees to recover the costs of the following regulatory 
        activities of the Commission: enforcement activities, 
        policy and rulemaking activities, user information 
        services, and international activities, and all 
        executive and legal costs incurred by the Commission in 
        the discharge of these functions.
          * * * * * * *
  (b) Establishment and Adjustment of Regulatory Fees.--
          (1) * * *
          * * * * * * *
          (4) Notice to congress.--The Commission shall--
                  (A) transmit to the Congress notification of 
                any adjustment made pursuant to paragraph (2) 
                immediately upon the adoption of such 
                adjustment; and
                  (B) transmit to the Congress notification of 
                any amendment made pursuant to paragraph (3) 
                not later than [90] 45 days before the 
                effective date of such amendment.
          (5) Effective date of adjustments.--The Commission is 
        authorized to continue to collect fees at the prior 
        year's rate until the effective date of fee adjustments 
        or amendments made pursuant to paragraph (2) or (3).
          * * * * * * *
  (g) Schedule.--Until amended by the Commission pursuant to 
subsection (b), the Schedule of Regulatory Fees which the 
Federal Communications Commission shall, subject to subsection 
(a)(2), assess and collect shall be as follows:
      

                       Schedule of Regulatory Fees                      
------------------------------------------------------------------------
                                                               Annual   
                                    Bureau/Category          Regulatory 
                                                                 Fee    
------------------------------------------------------------------------
                            Private Radio Bureau                        
      *         *         *         *         *         *         *     
                              [Amateur vanity call-signs..            7]
                            Mass Media Bureau (per                      
                             license)                                   
      *         *         *         *         *         *         *     
                              TV (47 CFR Part 73)                       
                               VHF Commercial                           
                                Markets 1 thru 10.........        18,000
      *         *         *         *         *         *         *     
                                Construction permits......         4,000
                                Terrestrial television                  
                                 satellite operations.....           500
                               UHF Commercial                           
                                Markets 1 thru 10.........        14,400
      *         *         *         *         *         *         *     
                                Construction permits......         3,200
                                Terrestrial television                  
                                 satellite operations.....           500
      *         *         *         *         *         *         *     
------------------------------------------------------------------------

      
  (h) Exceptions.--The charges established under this section 
shall not be applicable to (1) governmental entities or 
nonprofit entities; or (2) to amateur radio operator licenses 
under part 97 of the Commission's regulations (47 CFR Part 97). 
The exceptions provided by this subsection for governmental 
entities shall not be applicable to any services that are 
provided on a commercial basis in competition with another 
carrier.
  [(i) Accounting System.--The Commission shall develop 
accounting systems necessary to making the adjustments 
authorized by subsection (b)(3). In the Commission's annual 
report, the Commission shall prepare an analysis of its 
progress in developing such systems and shall afford interested 
persons the opportunity to submit comments concerning the 
allocation of the costs of performing the functions described 
in subsection (a) among the services in the Schedule.]

SEC. 10. ACCOUNTING SYSTEM AND ADJUSTMENT INFORMATION.

  (a) Accounting System Required.--The Commission shall develop 
accounting systems for the purposes of making the adjustments 
authorized by sections 8 and 9. The Commission shall annually 
prepare and submit to the Congress an analysis of such systems 
and shall annually afford interested persons the opportunity to 
submit comments concerning the allocation of the costs of 
performing the functions described in section 8(a)(5) and 
9(a)(1) in making such adjustments in the schedules required by 
sections 8 and 9.
  (b) Information Required in Connection with Adjustment of 
Application and Regulatory Fees.--
          (1) Schedule of requested amounts.--No later than May 
        1 of each calendar year, the Commission shall prepare 
        and transmit to the committees of Congress responsible 
        for the Commission's authorization and appropriations a 
        detailed schedule of the amounts requested by the 
        President's budget to be appropriated for the ensuing 
        fiscal year for the activities described in sections 
        8(a)(5) and 9(a)(1), allocated by bureaus, divisions, 
        and offices of the Commission.
          (2) Explanatory statement.--If the Commission 
        anticipates increases in the application fees or 
        regulatory fees applicable to any applicant, licensee, 
        or unit subject to payment of fees, the Commission 
        shall submit to the Congress by May 1 of such calendar 
        year a statement explaining the relationship between 
        any such increases and either (A) increases in the 
        amounts requested to be appropriated for Commission 
        activities in connection with such applicants, 
        licensees, or units subject to payment of fees, or (B) 
        additional activities to be performed with respect to 
        such applicants, licensees, or units.
          (3) Definition.--For purposes of this subsection, the 
        term ``amount requested by the President's budget'' 
        shall include any adjustments to such requests that are 
        made by May 1 of such calendar year. If any such 
        adjustment is made after May 1, the Commission shall 
        provide such committees with updated schedules and 
        statements containing the information required by this 
        subsection within 10 days after the date of any such 
        adjustment.

                       Title II--Common Carriers

          * * * * * * *

SEC. 203. SCHEDULES OF CHARGES.

  (a) * * *
          * * * * * * *
  (d) The Commission may reject and refuse to file any schedule 
entered for filing which does not provide and give lawful 
notice of its effective date. The Commission may, after 
affording interested parties an opportunity to comment, reject 
a proposed tariff filing in whole or in part, if the filing or 
any part thereof is patently unlawful. In evaluating whether a 
proposed tariff filing is patently unlawful, the Commission may 
consider additional information filed by the carrier or any 
interested party and shall presume the facts alleged by the 
carrier to be true. Any schedule so rejected by the Commission 
shall be void and its use shall be unlawful.
          * * * * * * *

SEC. 230. REFUND AUTHORITY.

  In addition to any other provision of this Act under which 
the Commission may order refunds, the Commission may require by 
order the refund of such portion of any charge by any carrier 
or carriers as results from a violation of section 220 (a), 
(b), or (d) or 221 (c) or (d) or of any of the rules 
promulgated pursuant to such sections or pursuant to section 
215, 218, or 219. Such refunds shall be ordered only to the 
extent that the Commission or a court finds that such violation 
resulted in unlawful charges and shall be made to such persons 
or classes of persons as the Commission determines reasonably 
represent the persons from whom amounts were improperly 
received by reason of such violation. No refunds shall be 
required under this section unless--
          (1) the Commission issues an order advising the 
        carrier of its potential refund liability and provides 
        the carrier with an opportunity to file written 
        comments as to why refunds should not be required; and
          (2) such order is issued not later than 5 years after 
        the date the charge was paid.
In the case of a continuing violation, a violation shall be 
considered to occur on each date that the violation is 
repeated.

                TITLE III--PROVISIONS RELATING TO RADIO

                       Part I--General Provisions

          * * * * * * *

SEC. 302. DEVICES WHICH INTERFERE WITH RADIO RECEPTION.

  (a) * * *
          * * * * * * *
  (d)(1) Within 180 days after the date of enactment of this 
subsection, the Commission shall prescribe and make effective 
regulations denying equipment authorization (under part 15 of 
title 47, Code of Federal Regulations, or any other part of 
that title) for any scanning receiver that is capable of--
          (A) receiving transmissions in the frequencies 
        [allocated to the domestic cellular radio 
        telecommunications service] utilized to provide 
        commercial mobile service (as defined in section 
        332(d)),
          (B) readily being altered by the user to receive 
        transmissions in such frequencies, or
          (C) being equipped with decoders that convert digital 
        [cellular] commercial mobile service transmissions to 
        analog voice audio.
          * * * * * * *

SEC. 307. ALLOCATION OF FACILITIES; TERM OF LICENSES.

  (a) * * *
          * * * * * * *
  [(e)(1) Notwithstanding any license requirement established 
in this Act, the Commission may by rule authorize the operation 
of radio stations without individual licenses in the radio 
control service and the citizens band radio service if the 
Commission determines that such authorization serves the public 
interest, convenience, and necessity.
  [(2) Any radio station operator who is authorized by the 
Commission under paragraph (1) to operate without an individual 
license shall comply with all other provisions of this Act and 
with rules prescribed by the Commission under this Act.
  [(3) For purposes of this subsection, the terms ``radio 
control service'' and ``citizens band radio service'' shall 
have the meanings given them by the Commission by rule.]
  (e)(1) Notwithstanding any license requirement established in 
this Act, if the Commission determines that such authorization 
serves the public interest, convenience, and necessity, the 
Commission may by rule authorize the operation of radio 
stations without individual licenses in the following radio 
services: (A) the aviation radio service for aircraft stations 
operated on domestic flights when such aircraft are not 
otherwise required to carry a radio station; and (B) the 
maritime radio service for ship stations navigated on domestic 
voyages when such ships are not otherwise required to carry a 
radio station.
  (2) Any radio station operator who is authorized by the 
Commission to operate without an individual license shall 
comply with all other provisions of this Act and with rules 
prescribed by the Commission under this Act.
  (3) For purposes of this subsection, the terms ``aircraft 
station'' and ``ship station'' shall have the meanings given 
them by the Commission by rule.
          * * * * * * *

SEC. 309. ACTION UPON APPLICATIONS; FORM OF AND CONDITIONS ATTACHED TO 
                    LICENSES.

  (a) * * *
          * * * * * * *
  [(i) Random Selection.--
          [(1) General authority.--If--
                  [(A) there is more than one application for 
                any initial license or construction permit 
                which will involve a use of the electromagnetic 
                spectrum; and
                  [(B) the Commission has determined that the 
                use is not described in subsection (j)(2)(A);
        then the Commission shall have the authority to grant 
        such license or permit to a qualified applicant through 
        the use of a system of random selection.
      [(2) No license or construction permit shall be granted 
to an applicant selected pursuant to paragraph (1) unless the 
Commission determines the qualifications of such applicant 
pursuant to subsection (a) and section 308(b). When substantial 
and material questions of fact exist concerning such 
qualifications, the Commission shall conduct a hearing in order 
to make such determinations. For the purposes of making such 
determinations, the Commission may, by rule, and 
notwithstanding any other provision of law--
          [(A) adopt procedures for the submission of all or 
        part of the evidence in written form;
          [(B) delegate the function of presiding at the taking 
        of written evidence to Commission employees other than 
        administrative law judges; and
          [(C) omit the determination required by subsection 
        (a) with respect to any application other than the one 
        selected pursuant to paragraph (1).
      [(3)(A) The Commission shall establish rules and 
procedures to ensure that, in the administration of any system 
of random selection under this subsection used for granting 
licenses or construction permits for any media of mass 
communications, significant preferences will be granted to 
applicants or groups of applicants, the grant to which of the 
license or permit would increase the diversification of 
ownership of the media of mass communications. To further 
diversify the ownership of the media of mass communications, an 
additional significant preference shall be granted to any 
applicant controlled by a member or members of minority group.
      [(B) The Commission shall have authority to require each 
qualified applicant seeking a significant preference under 
subparagraph (A) to submit to the Commission such information 
as may be necessary to enable the Commission to make a 
determination regarding whether such applicant shall be granted 
such preference. Such information shall be submitted in such 
form, at such times, and in accordance with such procedures, as 
the Commission may require.
      [(C) For purposes of this paragraph:
  [(i) The term ``media of mass communication'' includes 
television, radio, cable television, multipoint distribution 
service, direct broadcast satellite service, and other 
services, the licensed facilities of which may be substantially 
devoted toward providing programming or other information 
services within the editorial control of the licensee.
  [(ii) The term ``minority group'' includes Blacks, Hispanics, 
American Indians, Alaska Natives, Asians, and Pacific 
Islanders.
  [(4)(A) The Commission shall, after notice and opportunity 
for hearing, prescribe rules establishing a system of random 
selection for use by the Commission under this subsection in 
any instance in which the Commission, in its discretion, 
determines that such use is appropriate for the granting of any 
license or permit in accordance with paragraph (1).
  [(B) The Commission shall have authority to amend such rules 
from time to time to the extent necessary too carry out the 
provisions of this subsection. Any such amendment shall be made 
after notice and opportunity for hearing.
  [(C) Not later than 180 days after the date of enactment of 
this subparagraph, the Commission shall prescribe such transfer 
disclosures and antitrafficking restrictions and payment 
schedules as are necessary to prevent the unjust enrichment of 
recipients of licenses or permits as a result of the methods 
employed to issue licenses under this subsection.]
  (j) Use of Competitive Bidding.--
          [(1) General authority.--If mutually exclusive 
        applications are accepted for filing for any initial 
        license or construction permit which will involve a use 
        of the electromagnetic spectrum described in paragraph 
        (2), then the Commission shall have the authority, 
        subject to paragraph (10), to grant such license or 
        permit to a qualified applicant through the use of a 
        system of competitive bidding that meets the 
        requirements of this subsection.
          [(2) Uses to which bidding may apply.--A use of the 
        electromagnetic spectrum is described in this paragraph 
        if the Commission determines that--
                  [(A) the principal use of such spectrum will 
                involve, or is reasonably likely to involve, 
                the licensee receiving compensation from 
                subscribers in return for which the licensee--
                          [(i) enables those subscribers to 
                        receive communications signals that are 
                        transmitted utilizing frequencies on 
                        which the licensee is licensed to 
                        operate; or
                          [(ii) enables those subscribers to 
                        transmit directly communications 
                        signals utilizing frequencies on which 
                        the licensee is licensed to operate; 
                        and
                  [(B) a system of competitive bidding will 
                promote the objectives described in paragraph 
                (3).]
          (1) General authority.--If, consistent with the 
        obligations described in paragraph (6)(E), mutually 
        exclusive applications are accepted for any initial 
        license or construction permit which will involve an 
        exclusive use of the electromagnetic spectrum, then the 
        Commission shall grant such license or permit to a 
        qualified applicant through a system of competitive 
        bidding that meets the requirements of this subsection.
          (2) Exemptions.--The competitive bidding authority 
        granted by this subsection shall not apply to licenses 
        or construction permits issued by the Commission--
                  (A) that, as the result of the Commission 
                carrying out the obligations described in 
                paragraph (6)(E), are not mutually exclusive;
                  (B) for public safety radio services, 
                including non-Government uses that protect the 
                safety of life, health, and property and that 
                are not made commercially available to the 
                public; or
                  (C) for initial licenses or construction 
                permits for new terrestrial digital television 
                services assigned by the Commission to existing 
                terrestrial broadcast licensees to replace 
                their current television licenses.
          * * * * * * *
          (8) Treatment of revenues.--
                  (A) * * *
                  (B) Retention of revenues.--Notwithstanding 
                subparagraph (A), the salaries and expenses 
                account of the Commission shall retain as an 
                offsetting collection such sums as may be 
                necessary from such proceeds for the costs of 
                developing and implementing the program 
                required by this subsection. Such offsetting 
                collections shall be available for obligation 
                subject to the terms and conditions of the 
                receiving appropriations account, and shall be 
                deposited in such accounts on a quarterly 
                basis. Any funds appropriated to the Commission 
                for fiscal years 1994 through 1998 for the 
                purpose of assigning licenses using random 
                selection under subsection (i) shall be used by 
                the Commission to implement this subsection. 
                Such offsetting collections are authorized to 
                remain available until expended.
                  (C) Escrow of deposit.--The Commission is 
                authorized, based on the competitive bidding 
                methodology selected, to provide for the 
                deposit of moneys for bids in an interest-
                bearing account until such time as the 
                Commission accepts a deposit from the high 
                bidder. All interest earned on bid moneys 
                received from the winning bidder shall be 
                deposited into the general fund of the 
                Treasury. All interest earned on bid moneys 
                deposited from unsuccessful bidders, less any 
                applicable fees and penalties, shall be paid to 
                those bidders.
          * * * * * * *
          (11) Termination.--The authority of the Commission to 
        grant a license or permit under this subsection shall 
        expire September 30, [1998.] 2002.
          * * * * * * *

SEC. 312. ADMINISTRATIVE SANCTIONS.

  (a) The Commission may revoke any station license or 
construction permit--
          (1) * * *
          * * * * * * *
          (6) for violation of section 1304, 1343, or 1464 of 
        title 18 of the United States Code; [or]
          (7) for willful or repeated failure to allow 
        reasonable access to or to permit purchase of 
        reasonable amounts of time for the use of a 
        broadcasting station by a legally qualified candidate 
        for Federal elective office on behalf of his 
        candidacy[.]; or
          (8) for failure to comply with any requirement of 
        this Act or the Commission's rules that imperils the 
        safety of life.
          * * * * * * *

       Part II--Radio Equipment and Radio Operators on Board Ship

          * * * * * * *

SEC. 362. INSPECTION.

  (a) * * *
  [(b) Every ship of the United States, subject to this part, 
shall have the equipment and apparatus prescribed therein, 
inspected at least once each year by the Commission. If, after 
such inspection, the Commission is satisfied that all relevant 
provisions of this Act and the station license have been 
complied with, the fact shall be certified to on the station 
license by the Commission. The Commission shall make such 
additional inspections at frequent intervals as may be 
necessary to insure compliance with the requirements of this 
Act. The Commission may, upon a finding that the public 
interest would be served thereby, waive the annual inspection 
required under this section from the time of first arrival at a 
United States port from a foreign port, for the sole purpose of 
enabling the vessel to proceed coastwise to another port in the 
United States where an inspection can be held: Provided, That 
such waiver may not exceed a period of thirty days.]
  (b) Every ship of the United States that is subject to this 
part shall have the equipment and apparatus prescribed therein 
inspected at least once each year by the Commission or an 
entity designated by the Commission. If, after such inspection, 
the Commission is satisfied that all relevant provisions of 
this Act and the station license have been complied with, the 
fact shall be certified to on the station license by the 
Commission. The Commission shall make such additional 
inspections at frequent intervals as the Commission determines 
may be necessary to ensure compliance with the requirements of 
this Act. The Commission may, upon a finding that the public 
interest could be served thereby--
          (1) waive the annual inspection required under this 
        section for a period of up to 90 days for the sole 
        purpose of enabling a vessel to complete its voyage and 
        proceed to a port in the United States where an 
        inspection can be held; or
          (2) waive the annual inspection required under this 
        section for a vessel that is in compliance with the 
        radio provisions of the Safety Convention and that is 
        operating solely in waters beyond the jurisdiction of 
        the United States, provided that such inspection shall 
        be performed within 30 days of such vessel's return to 
        the United States.
          * * * * * * *

 Part III--Radio Installations on Vessels Carrying Passengers for Hire

SEC. 385. INSPECTIONS.

      The Commission or an entity designated by the Commission 
shall make such inspections as may be necessary to insure 
compliance with the requirements of this part.

     Part IV--Assistance for Public Telecommunications Facilities; 
 Telecommunications Demonstrations; Corporation for Public Broadcasting

    [Subpart A--Assistance for Public Telecommunications Facilities

[SEC. 390. DECLARATION OF PURPOSE.

  [The purpose of this subpart is to assist, through matching 
grants, in the planning and construction of public 
telecommunications facilities in order to achieve the following 
objectives: (1) extend delivery of public telecommunications 
services to as many citizens of the United States as possible 
by the most efficient and economical means, including the use 
of broadcast and nonbroadcast technologies; (2) increase public 
telecommunications services and facilities available to, 
operated by, and owned by minorities and women; and (3) 
strengthen the capability of existing public television and 
radio stations to provide public telecommunications services to 
the public.

[SEC. 391. AUTHORIZATION OF APPROPRIATIONS.

  [There are authorized to be appropriated $42,000,000 for each 
of the fiscal years 1992, 1993, and 1994, to be used by the 
Secretary of Commerce to assist in the planning and 
construction of public telecommunications facilities as 
provided in this subpart. Sums appropriated under this subpart 
for any fiscal year shall remain available until expended for 
payment of grants for projects for which applications approved 
by the Secretary pursuant to this subpart have been submitted 
within such fiscal year. Sums appropriated under this subpart 
may be used by the Secretary to cover the cost of administering 
the provisions of this subpart.

[SEC. 392. GRANTS FOR CONSTRUCTION AND PLANNING.

  [(a) For each project for the construction of public 
telecommunications facilities there shall be submitted to the 
Secretary an application for a grant containing such 
information with respect to such project as the Secretary may 
require, including the total cost of such project, the amount 
of the grant requested for such project, and a 5-year plan 
outlining the applicant's projected facilities requirements and 
the projected costs of such facilities requirements. Each 
applicant shall also provide assurances satisfactory to the 
Secretary that--
          [(1) the applicant is (A) a public broadcast station; 
        (B) a noncommercial telecommunications entity; (C) a 
        system of public telecommunications entities; (D) a 
        nonprofit foundation, corporation, institution, or 
        association organized primarily for educational or 
        cultural purposes; or (E) a State or local government 
        (or any agency thereof), or a political or special 
        purpose subdivision of a State;
          [(2) the operation of such public telecommunication 
        facilities will be under the control of the applicant;
          [(3) necessary funds to construct, operate, and 
        maintain such public telecommunications facilities will 
        be available when needed;
          [(4) such public telecommunications facilities will 
        be used primarily for the provision of public 
        telecommunications services and that the use of such 
        public telecommunications facilities for purposes other 
        than the provision of public telecommunications 
        services will not interfere with the provision of such 
        public telecommunications services as required in this 
        part; 
          [(5) the applicant has participated in comprehensive 
        planning for such public telecommunications facilities 
        in the area which the applicant proposes to serve, and 
        such planning has included an evaluation of alternate 
        technologies and coordination with State educational 
        television and radio agencies, as appropriate; and
          [(6) the applicant will make the most efficient use 
        of the grant.
  [(b) Upon approving any application under this section with 
respect to any project for the construction of public 
telecommunications facilities, the Secretary shall make a grant 
to the applicant in an amount determined by the Secretary, 
except that such amounts shall not exceed 75 percent of the 
amount determined by the Secretary to be the reasonable and 
necessary cost of such project.
  [(c) The Secretary may provide such funds as the Secretary 
deems necessary for the planning of any project for which 
construction funds may be obtained under this section. An 
applicant for a planning grant shall provide such information 
with respect to such project as the Secretary may require and 
shall provide assurances satisfactory to the Secretary that the 
applicant meets the eligible requirements of subsection (a) to 
receive construction assistance.
  [(d) Any studies conducted by or for any grant recipient 
under this section shall be provided to the Secretary, if such 
studies are conducted through the use of funds received under 
this section.
  [(e) The Secretary shall establish such rules and regulations 
as may be necessary to carry out this subpart, including rules 
and regulations relating to the order of priority in approving 
applications for construction projects and relating to 
determining the amount of each grant for such projects.
  [(f) In establishing criteria for grants pursuant to section 
393 and in establishing procedures relating to the order of 
priority established in subsection (e) in approving 
applications for grants, the Secretary shall give special 
consideration to applications which would increase minority and 
women's ownership of, operation of, and participation in public 
telecommunications entities. The Secretary shall take 
affirmative steps to inform minorities and women of the 
availability of funds under this subpart, and the localities 
where new public telecommunications facilities are needed, and 
to provide such other assistance and information as may be 
appropriate.
  [(g) If, within 10 years after completion of any project for 
construction of public telecommunications facilities with 
respect to which a grant has been made under this section--
          [(1) the applicant or other owner of such facilities 
        ceases to be an agency, institution, foundation, 
        corporation, association, or other entity described in 
        subsection (a)(1); or
          [(2) such facilities cease to be used primarily for 
        the provision of public telecommunications services (or 
        the use of such public telecommunications facilities 
        for purposes other than the provision of public 
        telecommunications services interferes with the 
        provision of such public telecommunications services as 
        required in this part);
the United States shall be entitled to recover from the 
applicant or other owner of such facilities the amount bearing 
the same ratio to the value of such facilities at the time the 
applicant ceases to be such an entity or at the time of such 
determination (as determined by agreement of the parties or by 
action brought in the United States district court for the 
district in which such facilities are situated), as the amount 
of the Federal participation bore to the cost of construction 
of such facilities.
  [(h) Each recipient of assistance under this subpart shall 
keep such records as may be reasonably necessary to enable the 
Secretary to carry out the functions of the Secretary under 
this subpart, including a complete and itemized inventory of 
all public telecommunications facilities under the control of 
such recipient, and records which fully disclose the amount and 
the disposition by such recipient of the proceeds of such 
assistance, the total cost of the project in connection with 
which such assistance is given or used, the amount and nature 
of that portion of the cost of the project supplied by other 
sources, and such other records as will facilitate an effective 
audit.
  [(i) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall 
have access for the purpose of audit and examination to any 
books, documents, papers, and records of any recipient of 
assistance under this subpart that are pertinent to assistance 
received under this subpart.

[SEC. 393. CRITERIA FOR APPROVAL AND EXPENDITURES BY SECRETARY OF 
                    COMMERCE.
  [(a) The Secretary, in consultation with the Corporation, 
public telecommunications entities, and as appropriate with 
others, shall estblish criteria for making construction and 
planning grants. Such criteria shall be consistent with the 
objectives and provisions set forth in this subpart, and shall 
be made available to interested parties upon request.
  [(b) The Secretary shall base determinations of whether to 
approve applications for grants under this subpart, and the 
amount of such grants, on criteria developed pursuant to 
subsection (a) and designed to achieve--
          [(1) the provision of new telecommunications 
        facilities to extend service to areas currently not 
        receiving public telecommunications services;
          [(2) the expansion of the service areas of existing 
        public telecommunications entities;
          [(3) the development of public telecommunications 
        facilities owned by, operated by, and available to 
        minorities and women; and
          [(4) the improvement of the capabilities of existing 
        public broadcast stations to provide public 
        telecommunications services, including services to 
        underserved audiences such as deaf and hearing impaired 
        individuals and blind and visually impaired 
        individuals.
  [(c) Of the sums appropriated pursuant to section 391 for any 
fiscal year, a substantial amount shall be available for the 
expansion and development of noncommercial radio broadcast 
station facilities.

[SEC. 393A. LONG-RANGE PLANNING FOR FACILITIES.
  [(a) The Secretary, in consultation with the Corporation, 
public telecommunications entities, and as appropriate with 
other parties, shall develop a long-range plan to accomplish 
the objectives set forth in section 390. Such plan shall 
include a detailed 5-year projection of the broadcast and 
nonbroadcast public telecommunications facilities required to 
meet such objectives, and the expenditures necessary to provide 
such facilities.
  [(b) The plan required in subsection (a) shall be updated 
annually, and a summary of the activities of the Secretary in 
implementing the plan, shall be submitted concurrently to the 
President and the Congress not later than the 31st day of 
December of each year.

  [Subpart B--National Endowment for Children's Educational Television

[SEC. 394. ESTABLISHMENT OF NATIONAL ENDOWMENT.
  [(a) It is the purpose of this section to enhance the 
education of children through the creation and production of 
television programming specifically directed toward the 
development of fundamental intellectual skills.
  [(b)(1) There is established, under the direction of the 
Secretary, a National Endowment for Children's Educational 
Television. In administering the National Endowment, the 
Secretary is authorized to--
          [(A) contract with the Corporation for the production 
        of educational television programming for children; and
          [(B) make grants directly to persons proposing to 
        create and produce educational television programming 
        for children.
The Secretary shall consult with the Advisory Council on 
Children's Educational Television in the making of the grants 
or the awarding of contracts for the purpose of making the 
grants.
  [(2) Contracts and grants under this section shall be made on 
the condition that the programming shall--
          [(A) during the first two years after its production, 
        be made available only to public television licensees 
        and permittees and noncommercial television licensees 
        and permittees; and
          [(B) thereafter be made available to any commercial 
        television licensee or permittee or cable television 
        system operator, at a charge established by the 
        Secretary that will assure the maximum practicable 
        distribution of such programming, so long as such 
        licensee, permittee, or operator does not interrupt the 
        programming with commercial advertisements.
The Secretary may, consistent with the purpose and provisions 
of this section, permit the programming to be distributed to 
persons using other media, establish conditions relating to 
such distribution, and apply those conditions to any contract 
or grant made under this section. The Secretary may waive the 
requirements of subparagraph (A) if the Secretary finds that 
neither public television licensees and permittees nor 
noncommercial television licensees and permittees will have an 
opportunity to air such programming in the first two years 
after its production.
  [(c)(1) The Secretary, with the advice of the Advisory 
Council on Children's Educational Television, shall establish 
criteria for making contracts and grants under this section. 
Such criteria shall be consistent with the purpose and 
provisions of this section and shall be made available to 
interested parties upon request. Such criteria shall include--
          [(A) criteria to maximize the amount of programming 
        that is produced with the funds made available by the 
        Endowment;
          [(B) criteria to minimize the costs of--
                  [(i) selection of grantees,
                  [(ii) administering the contracts and grants, 
                and
                  [(iii) the administrative costs of the 
                programming production; and
          [(C) criteria to otherwise maximize the proportion of 
        funds made available by the Endowment that are expended 
        for the cost of programming production.
  [(2) Applications for grants under this section shall be 
submitted to the Secretary in such form and containing such 
information as the Secretary shall require by regulation.
  [(d) Upon approving any application for a grant under 
subsection (b)(1)(B), the Secretary shall make a grant to the 
applicant in an amount determined by the Secretary, except that 
such amounts shall not exceed 75 percent of the amount 
determined by the Secretary to be the reasonable and necessary 
cost of the project for which the grant is made.
  [(e)(1) The Secretary shall establish an Advisory Council on 
Children's Educational Television. The Secretary shall appoint 
ten individuals as members of the Council and designate one of 
such members to serve as Chairman.
  [(2) Members of the Council shall have terms of two years, 
and no member shall serve for more than three consecutive 
terms. The members shall have expertise in the fields of 
education, psychology, child development, or television 
programming, or related disciplines. Officers and employees of 
the United States shall not be appointed as members.
  [(3) While away from their homes or regular places of 
business in the performance of duties for the Council, the 
members of the Council shall serve without compensation but 
shall be allowed travel expenses, including per diem in lieu of 
subsistence, in accordance with section 5703 of title 5, United 
States Code.
  [(4) The Council shall meet at the call of the Chairman and 
shall advise the Secretary concerning the making of contracts 
and grants under this section.
  [(f)(1) Each recipient of a grant under this section shall 
keep such records as may be reasonably necessary to enable the 
Secretary to carry out the Secretary's functions under this 
section, including records which fully disclose the amount and 
the disposition by such recipient of the proceeds of such 
grant, the total cost of the project, the amount and nature of 
that portion of the cost of the project supplied by other 
sources, and such other records as will facilitate an effective 
audit.
  [(2) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall 
have access for the purposes of audit and examination to any 
books, documents, papers, and records of the recipient that are 
pertinent to a grant received under this section.
  [(g) The Secretary is authorized to make such rules and 
regulations as may be necessary to carry out this section, 
including those relating to the order of priority in approving 
applications for projects under this section or to determining 
the amounts of contracts and grants for such projects.
  [(h) There are authorized to be appropriated $2,000,000 for 
fiscal year 1991, $4,000,000 for fiscal year 1992, $5,000,000 
for fiscal year 1993, and $6,000,000 for fiscal year 1994 to be 
used by the Secretary to carry out the provisions of this 
section. Sums appropriated under this subsection for any fiscal 
year shall remain available for contracts and grants for 
projects for which applications approved under this section 
have been submitted within one year after the last day of such 
fiscal year.
  [(i) For purposes of this section--
          [(1) the term ``educational television programming 
        for children'' means any television program which is 
        directed to an audience of children who are 16 years of 
        age or younger and which is designed for the 
        intellectual development of those children, except that 
        such term does not include any television program which 
        is directed to a general audience but which might also 
        be viewed by a significant number of children; and
          [(2) the term ``person'' means an individual, 
        partnership, association, joint stock company, trust, 
        corporation, or State or local governmental entity.

             [Subpart C--Telecommunications Demonstrations

[SEC. 395. ASSISTANCE FOR DEMONSTRATION PROJECTS.

  [(a) It is the purpose of this subpart to promote the 
development of nonbroadcast telecommunications facilities and 
services for the transmission, distribution, and delivery of 
health, education, and public or social service information. 
The Secretary is authorized, upon receipt of an application in 
such form and containing such information as he may by 
regulation require, to make grants to, and enter into contracts 
with, public and private nonprofit agencies, organizations, and 
institutions for the purpose of carrying out telecommunications 
demonstrations.
  [(b) The Secretary may approve an application submitted under 
subsection (a) if he determines that--
          [(1) the project for which application is made will 
        demonstrate innovative methods or techniques of 
        utilizing nonbroadcast telecommunications equipment or 
        facilities to satisfy the purpose of this subpart;
          [(2) demonstrations and related activities assisted 
        under this subpart will remain under the administration 
        and control of the applicant;
          [(3) the applicant has the managerial and technical 
        capability to carry out the project for which the 
        application is made; and
          [(4) the facilities and equipment acquired or 
        developed pursuant to the application will be used 
        substantially for the transmission, distribution, and 
        delivery of health, education, or public or social 
        service information.
  [(c) Upon approving any application under this subpart with 
respect to any project, the Secretary shall make a grant to or 
enter into a contract with the applicant in an amount 
determined by the Secretary not to exceed the reasonable and 
necessary cost of such project. The Secretary shall pay such 
amount from the sums available therefor, in advance or by way 
of reimbursement, and in such installments consistent with 
established practice, as he may determine.
  [(d) Funds made available pursuant to this subpart shall not 
be available for the construction, remodeling, or repair of 
structures to house the facilities or equipment acquired or 
developed with such funds, except that such funds may be used 
for minor remodeling which is necessary for and incidental to 
the installation of such facilities or equipment.
  [(e) For purposes of this section, the term ``nonbroadcast 
telecommunications facilities'' includes, but is not limited 
to, cable television systems, communications satellite systems 
and related terminal equipment, and other modes of 
transmitting, emitting, or receiving images and sounds or 
intelligence by means of wire, radio, optical, electromagnetic 
or other means.
  [(f) The funding of any demonstration pursuant to this 
subpart shall continue for not more than 3 years from the date 
of the original grant or contract.
  [(g) The Secretary shall require that the recipient of a 
grant or contract under this subpart submit a summary and 
evaluation of the results of the demonstration at least 
annually for each year in which funds are received pursuant to 
this section.
  [(h)(1) Each recipient of assistance under this subpart shall 
keep such records as may be reasonably necessary to enable the 
Secretary to carry out the Secretary's functions under this 
subpart, including records which fully disclose the amount and 
the disposition by such recipient of the proceeds of such 
assistance, the total cost of the project or undertaking in 
connection with which such assistance is given or used, the 
amount and nature of that portion of the cost of the project or 
undertaking supplied by other sources, and such other records 
as will facilitate an effective audit.
  [(2) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall 
have access for the purposes of audit and examination to any 
books, documents, papers, and records of the recipient that are 
pertinent to assistance received under this subpart.
  [(i) The Secretary is authorized to make such rules and 
regulations as may be necessary to carry out this subpart, 
including regulations relating to the order of priority in 
approving applications for projects under this subpart or to 
determining the amounts of grants for such projects.
  [(j) The Commission is authorized to provide such assistance 
in carrying out the provisions of this subpart as may be 
requested by the Secretary. The Secretary shall provide for 
close coordination with the Commission in the administration of 
the Secretary's functions under this subpart which are of 
interest to or affect the functions of the Commission. The 
Secretary shall provide for close coordination with the 
Corporation in the administration of the Secretary's functions 
udner this subpart which are of interest to or affect the 
functions of the Corporation.
  [(k) There are authorized to be appropriated $1,000,000 for 
each of the fiscal years 1979, 1980, and 1981, to be used by 
the Secretary to carry out the provisions of this subpart. Sums 
appropriated under this subsection for any fiscal year shall 
remain available for payment of grants or contracts for 
projects for which applications approved under this subpart 
have been submitted within one year after the last day of such 
fiscal year.]
          * * * * * * *

                 TITLE V--PENAL PROVISIONS--FORFEITURES

          * * * * * * *

SEC. 503. FORFEITURES IN CASES OF REBATES AND OFFSETS.

  (a) * * *
  (b)(1) Any person who is determined by the Commission, in 
accordance with paragraph (3) or (4) of this subsection, to 
have--
          (A) * * *
          * * * * * * *
          (C) violated any provision of section 317(c) or 
        508(a) of this Act; [or]
          (D) violated any provision of section 1304, 1343, or 
        1464 of title 18, United States Code; or
          (E) failed to comply with any requirement of this Act 
        or the Commission's rules that imperils the safety of 
        life;
shall be liable to the United States for a forfeiture penalty. 
A forfeiture penalty under this subsection shall be in addition 
to any other penalty provided for by this Act; except that this 
subsection shall not apply to any conduct which is subject to 
forfeiture under title II, part II or III of title III, or 
section 506 of this Act.
          * * * * * * *
  (6) No forfeiture penalty shall be determined or imposed 
against any person under this subsection if--
          (A) such person holds a broadcast station license 
        issued under title III of this Act and if the violation 
        charged occurred--
                  (i) more than 1 year prior to the date of 
                issuance of the required notice or notice of 
                apparent liability; or
                  (ii) prior to the date of commencement of the 
                current term of such license,
        whichever is earlier; [or]
          (B) such person is a common carrier and the required 
        notice of apparent liability is issued more than 5 
        years after the date the violation charged occurred; or
          [(B)] (C) such person does not hold a broadcast 
        station license issued under title III of this Act and 
        is not a common carrier and if the violation charged 
        occurred more than 1 year prior to the date of issuance 
        of the required notice or notice of apparent liability.
For purposes of this paragraph, ``date of commencement of the 
current term of such license'' means the date of commencement 
of the last term of license for which the licensee has been 
granted a license by the Commission. A separate license term 
shall not be deemed to have commenced as a result of continuing 
a license in effect under section 307(c) pending decision on an 
application for renewal of the license.
          * * * * * * *
                              ----------                              


NATIONAL TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION ORGANIZATION 
                                  ACT

  TITLE I--NATIONAL TELECOMMUNICATIONS AND INFORMATION ADMINISTRATION

          * * * * * * *

              PART B--TRANSFER OF AUCTIONABLE FREQUENCIES

SEC. 113. IDENTIFICATION OF REALLOCABLE FREQUENCIES.

  (a) * * *
  (b) Minimum Amount of Spectrum Recommended.--
          (1) [In general] Initial reallocation report.--In 
        accordance with the provisions of this section, the 
        Secretary shall recommend for reallocation in the first 
        report required by subsection (a), for use other than 
        by Federal Government stations under section 305 of the 
        1934 Act (47 U.S.C. 305), bands of frequencies that in 
        the aggregate span not less than 200 megahertz, that 
        are located below 5 gigahertz, and that meet the 
        criteria specified in paragraphs (1) through (5) of 
        subsection (a). Such bands of frequencies shall include 
        bands of frequencies, located below 3 gigahertz, that 
        span in the aggregate not less than 100 megahertz.
          (2) Mixed uses permitted to be counted.--Bands of 
        frequencies which a report of the Secretary under 
        subsection (a) or (d)(1) recommends be partially 
        retained for use by Federal Government stations, but 
        which are also recommended to be reallocated to be made 
        available under the 1934 Act for use by non-Federal 
        stations, may be counted toward the minimum spectrum 
        required by paragraph (1) or (3) of this subsection, 
        except that--
                  (A) the bands of frequencies counted under 
                this paragraph may not count toward more than 
                one-half of the minimums required by paragraph 
                (1) or (3) of this subsection;
          * * * * * * *
          (3) Second reallocation report.--In accordance with 
        the provisions of this section, the Secretary shall 
        recommend for reallocation in the second report 
        required by subsection (a), for use other than by 
        Federal Government stations under section 305 of the 
        1934 Act (47 U.S.C. 305), a single frequency band that 
        spans not less than an additional 20 megahertz, that is 
        located below 3 gigahertz, and that meets the criteria 
        specified in paragraphs (1) through (5) of subsection 
        (a).
          * * * * * * *
  (f) Additional Reallocation Report.--If the Secretary 
receives a notice from the Commission pursuant to section 
3001(b)(3) of the Omnibus Budget Reconciliation Act of 1995, 
the Secretary shall prepare and submit to the President and the 
Congress a report recommending for reallocation for use other 
than by Federal Government stations under section 305 of the 
1934 Act (47 U.S.C. 305), bands of frequencies that are 
suitable for the uses identified in the Commission's notice.

SEC. 114. WITHDRAWAL OR LIMITATION OF ASSIGNMENT TO FEDERAL GOVERNMENT 
                    STATIONS.

  (a) In General.--The President shall--
          (1) within 6 months after receipt of a report by the 
        Secretary under subsection [(a) or (d)(1)] (a), (d)(1), 
        of (f) of section 113, withdraw the assignment to a 
        Federal Government station of any frequency which the 
        report recommends for immediate reallocation;
          * * * * * * *

SEC. 115. DISTRIBUTION OF FREQUENCIES BY THE COMMISSION.

  (a) * * *
  (b) Allocation and Assignment of Remaining Available 
Frequencies.--With respect to the frequencies made available 
for reallocation pursuant to section 113(e)(3), the Commission 
shall, not later than 1 year after receipt of [the report 
required by section 113(a)] the initial reallocation report 
required by section 113(a), prepare, submit to the President 
and the Congress, and implement, a plan for the allocation and 
assignment under the 1934 Act of such frequencies. Such plan 
shall--
          (1) * * *
          * * * * * * *
  (c) Allocation and Assignment of Frequencies Identified in 
the Second Reallocation Report.--With respect to the 
frequencies made available for reallocation pursuant to section 
113(b)(3), the Commission shall, not later than 1 year after 
receipt of the second reallocation report required by such 
section, prepare, submit to the President and the Congress, and 
implement, a plan for the allocation and assignment under the 
1934 Act of such frequencies. Such plan shall propose the 
immediate allocation and assignment of all such frequencies in 
accordance with section 309(j).
          * * * * * * *
                              ----------                              


SECTION 6 OF THE FEDERAL COMMUNICATIONS COMMISSION AUTHORIZATION ACT OF 
                                  1988

                        older americans program

  Sec. 6. (a) During [fiscal years 1992 and 1993] fiscal year 
1996, the Federal Communications Commission is authorized to 
make grants to, or enter into cooperative agreements with, 
private nonprofit organizations designated by the Secretary of 
Labor under title V of the Older Americans Act of 1965 (42 
U.S.C. 3056 et seq) to utilize the talents of older Americans 
in programs authorized by other provisions of law administered 
by the Commission (and consistent with such provisions of law) 
in providing technical and administrative assistance for 
projects related to the implementation, promotion, or 
enforcement of the regulations of the Commission.
          * * * * * * *
                              ----------                              


               OMNIBUS BUDGET RECONCILIATION ACT OF 1990

          * * * * * * *

              TITLE VI--ENERGY AND ENVIRONMENTAL PROGRAMS

          * * * * * * *

              Subtitle B--NRC User Fees and Annual Charges

SEC. 6101. NRC USER FEES AND ANNUAL CHARGES.

    (a) Annual Assessment.--
          (1) * * *
          * * * * * * *
          (3) Last assessment of annual charges.--The last 
        assessment of annual charges under subsection (c) shall 
        be made not later than September 30, [1998] 2002.
          * * * * * * *

         TITLE X--MISCELLANEOUS USER FEES AND OTHER PROVISIONS

          * * * * * * *

                       ATOMIC ENERGY ACT OF 1954

                       ATOMIC ENERGY ACT OF 1954

                           TABLE OF CONTENTS

                         TITLE I--ATOMIC ENERGY

             Chapter 1. Declaration, Findings, and Purpose

Sec. 1. Declaration.
          * * * * * * *

             TITLE II--UNITED STATES ENRICHMENT CORPORATION

                     Chapter 22--General Provisions

Sec. 1201. Definitions.
[Sec. 1202. Purposes.]

   Chapter 23--Establishment, Powers, and Organization of Corporation

[Sec. 1301. Establishment of the Corporation.
[Sec. 1302. Corporate offices.
[Sec. 1303. Powers of the Corporation.
[Sec. 1304. Board of Directors.]
     * * * * * * *
[Sec. 1306. Audits.
[Sec. 1307. Annual reports.
[Sec. 1308. Accounts.
[Sec. 1309. Obligations.
[Sec. 1310. Exemption from taxation and payments in lieu of taxes.
[Sec. 1311. Cooperation with other agencies.
[Sec. 1312. Applicability of certain Federal laws.
[Sec. 1313. Security.
[Sec. 1314. Control of information.
[Sec. 1315. Transition.
[Sec. 1316. Working Capital Account.]

      Chapter 24--Rights, Privileges, and Assets of the Corporation

Sec. 1401. Marketing and contracting authority.
     * * * * * * *
[Sec. 1404. Capital structure of Corporation.
[Sec. 1405. Patents and inventions.]
     * * * * * * *
Sec. 1408. Uranium transfers and sales.
Sec. [1408.] 1409. Purchase of highly enriched uranium from former 
          Soviet Union.

              Chapter 25--Privatization of the Corporation

Sec. 1501. Strategic plan for privatization.
Sec. 1502. Privatization.
Sec. 1503. Establishment of Private Corporation.
Sec. 1504. Ownership Limitations.
Sec. 1505. Exemption from Liability.
Sec. 1506. Resolution of Certain Issues.
Sec. 1507. Application of Privatization Proceeds.

  Chapter 26--AVLIS and Alternative Technologies for Uranium Enrichment

[Sec. 1601. Assessment by United States Enrichment Corporation.]
     * * * * * * *
[Sec. 1603. Predeployment activities by United States Enrichment 
          Corporation.
[Sec. 1604. United States Enrichment Corporation sponsorship of private 
          for-profit corporation to construct AVLIS and alternative 
          technologies for uranium enrichment.
[Sec. 1605. AVLIS Commercialization Fund within United States Enrichment 
          Corporation.
[Sec. 1606. Department research and development assistance.
[Sec. 1607. Site selection.]
     * * * * * * *

                         TITLE I--ATOMIC ENERGY

          * * * * * * *

                         CHAPTER 2. DEFINITIONS

  Sec. 11. Definition.--The intent of Congress in the 
definitions as given in this section should be construed from 
the words or phrases used in the definitions. As used in this 
Act:
  a. * * *
          * * * * * * *
  v. The term ``production facility'' means (1) any equipment 
or device determined by rule of the Commission to be capable of 
the production of special nuclear material in such quantity as 
to be of significance to the common defense and security, or in 
such manner as to affect the health and safety of the public; 
or (2) any important component part especially designed for 
such equipment or device as determined by the Commission. 
Except with respect to the export of a uranium enrichment 
production facility [or the construction and operation of a 
uranium enrichment production facility using Atomic Vapor Laser 
Isotope Separation technology], such term as used in chapters 
10 and 16 shall not include any equipment or device (or 
important component part especially designed for such equipment 
or device) capable of separating the isotopes of uranium or 
enriching uranium in the isotope 235.
          * * * * * * *

        CHAPTER 16. JUDICIAL REVIEW AND ADMINISTRATIVE PROCEDURE

          * * * * * * *

SEC. 193. LICENSING OF URANIUM ENRICHMENT FACILITIES.

  (a) * * *
          * * * * * * *
  (f) Limitation.--If the privatization of the United States 
Enrichment Corporation results in the Corporation being--
          (1) owned, controlled, or dominated by a foreign 
        corporation or a foreign government, or
          (2) otherwise inimical to the common defense or 
        security of the United States,
any license held by the Corporation under sections 53 and 63 
shall be terminated.

             TITLE II--UNITED STATES ENRICHMENT CORPORATION

                     CHAPTER 22--GENERAL PROVISIONS

 H4  deg.SEC. 1201. DEFINITIONS.

  For purposes of this title:
          (1) * * *
          * * * * * * *
          (4) The term ``Corporation'' means the United States 
        Enrichment Corporation and any successor corporation 
        established through privatization of the Corporation.
          * * * * * * *
          (10) The term ``low-level radioactive waste'' has the 
        meaning given such term in section 102(9) of the Low-
        Level Radioactive Waste Policy Amendments Act of 1985 
        (42 U.S.C. 2021b(9)).
          (11) The term ``mixed waste'' has the meaning given 
        such term in section 1004(41) of the Solid Waste 
        Disposal Act (42 U.S.C. 6903(41)).
          (12) The term ``privatization'' means the transfer of 
        ownership of the Corporation to private investors 
        pursuant to chapter 25.
          (13) The term ``privatization date'' means the date 
        on which 100 percent of ownership of the Corporation 
        has been transferred to private investors.
          [(10)] (14) The term ``releases'' has the meaning 
        given the term ``release'' in section 101(22) of the 
        Comprehensive Environmental Response, Compensation, and 
        Liability Act of 1980 (42 U.S.C. 9601(22)).
          [(11)] (15) The term ``remedial action'' has the 
        meaning given such term in section 101(24) of the 
        Comprehensive Environmental Response, Compensation, and 
        Liability Act of 1980 (42 U.S.C. 9601(24)).
          [(12)] (16) The term ``response actions'' has the 
        meaning given the term ``response'' in section 101(25) 
        of the Comprehensive Environmental Response, 
        Compensation, and Liability Act of 1980 (42 U.S.C. 
        9601(25)).
          [(13)] (17) The term ``Secretary'' means the 
        Secretary of Energy.
          (18) The term ``transition date'' means July 1, 1993.
          [(14)] (19) The term ``uranium enrichment'' means the 
        separation of uranium of a given isotopic content into 
        2 components, 1 having a higher percentage of a fissile 
        isotope and 1 having a lower percentage.
          (20) The term ``gaseous diffusion plants'' means the 
        Paducah Gaseous Diffusion Plant at Paducah, Kentucky 
        and the Portsmouth Gaseous Diffusion Plant at Piketon, 
        Ohio.
          (21) The term ``private corporation'' means the 
        corporation established under section 1503.
          (22) The term ``Russian HEU agreement'' means the 
        Agreement Between the Government of the United States 
        of America and the Government of the Russian Federation 
        Concerning the Disposition of Highly Enriched Uranium 
        Extracted from Nuclear Weapons, dated February 18, 
        1993.
          (23) The term ``Suspension Agreement'' means the 
        Agreement to Suspend the Antidumping Investigation on 
        Uranium from the Russian Federation, as amended.

 H4  deg.[SEC. 1202. PURPOSES.

  [The Corporation is created for the following purposes:
          [(1) To operate as a business enterprise on a 
        profitable and efficient basis.
          [(2) To maximize the long-term value of the 
        Corporation to the Treasury of the United States.
          [(3) To lease Department uranium enrichment 
        facilities, as needed.
          [(4) To acquire uranium for uranium enrichment, low-
        enriched uranium for resale, and highly enriched 
        uranium for conversion into low-enriched uranium, as 
        needed.
          [(5) To market and sell its enriched uranium and 
        uranium enrichment and related services to--
                  [(A) the Department for governmental 
                purposes; and
                  [(B) domestic and foreign persons, as 
                provided in section 1303(6).
          [(6) To conduct research and development as required 
        to meet business objectives for the purposes of 
        identifying, evaluating, improving, and testing 
        alternative technologies for uranium enrichment.
          [(7) To conduct the business as a self-financing 
        corporation and eliminate the need for Federal 
        Government appropriations or sources of Federal 
        financing other than those provided in this title.
          [(8) To help maintain a reliable and economical 
        domestic source of uranium enrichment services.
          [(9) To comply with laws, and regulations promulgated 
        thereunder, to protect the public health, safety, and 
        the environment.
          [(10) To continue at all times to meet the objectives 
        of ensuring the Nation's common defense and security, 
        including abiding by United States laws and policies 
        concerning special nuclear materials and 
        nonproliferation of atomic weapons and other 
        nonpeaceful uses of atomic energy.
          [(11) To take all other lawful actions in furtherance 
        of these purposes.]

   CHAPTER 23--ESTABLISHMENT, POWERS, AND ORGANIZATION OF CORPORATION

 H4  deg.[SEC. 1301. ESTABLISHMENT OF THE CORPORATION.

  [(a) In General.--There is established a body corporate to be 
known as the United States Enrichment Corporation.
  [(b) Government Corporation.--The Corporation shall be 
established as a wholly owned Government corporation subject to 
chapter 91 of title 31, United States Code (commonly referred 
to as the Government Corporation Control Act), except as 
otherwise provided in this title.
  [(c) Federal Agency.--The Corporation shall be an agency and 
instrumentality of the United States.

 H4  deg.[SEC. 1302. CORPORATE OFFICES.

  [The Corporation shall maintain an office for the service of 
process and papers in the District of Columbia, and shall be 
deemed, for purposes of venue in civil actions, to be a 
resident thereof. The Corporation may establish offices in such 
other place or places as it may deem necessary or appropriate 
in the conduct of its business.

 H4  deg.[SEC. 1303. POWERS OF THE CORPORATION.

  [In order to accomplish its purposes, the Corporation--
          [(1) shall, except as provided in this title or 
        applicable Federal law, have all the powers of a 
        private corporation incorporated under the District of 
        Columbia Business Corporation Act;
          [(2) shall have the priority of the United States 
        with respect to the payment of debts out of bankrupt, 
        insolvent, and decedents' estates;
          [(3) may obtain from the Administrator of General 
        Services the services the Administrator is authorized 
        to provide agencies of the United States, on the same 
        basis as those services are provided to other agencies 
        of the United States;
          [(4) shall enrich uranium, provide for uranium to be 
        enriched by others, or acquire enriched uranium 
        (including low-enriched uranium derived from highly 
        enriched uranium provided under section 1408);
          [(5) may conduct, or provide for conducting, those 
        research and development activities related to uranium 
        enrichment and related processes and activities the 
        Corporation considers necessary or advisable to 
        maintain the Corporation as a commercial enterprise 
        operating on a profitable and efficient basis;
          [(6) may enter into transactions regarding uranium, 
        enriched uranium, or depleted uranium with--
                  [(A) persons licensed under section 53, 63, 
                103, or 104 in accordance with the licenses 
                held by those persons;
                  [(B) persons in accordance with, and within 
                the period of, an agreement for cooperation 
                arranged under section 123; or
                  [(C) persons otherwise authorized by law to 
                enter into such transactions;
          [(7) may enter into contracts with persons licensed 
        under section 53, 63, 103, or 104, for as long as the 
        Corporation considers necessary or desirable, to 
        provide uranium or uranium enrichment and related 
        services;
          [(8) may enter into contracts to provide uranium or 
        uranium enrichment and related services in accordance 
        with, and within the period of, an agreement for 
        cooperation arranged under section 123 or as otherwise 
        authorized by law; and
          [(9) shall sell to the Department as provided in this 
        title, without regard to section 57 e., the amounts of 
        uranium enrichment and related services that the 
        Department determines from time to time are required 
        for it to--
                  [(A) carry out Presidential directions and 
                authorizations under section 91; and
                  [(B) conduct other Department programs.

 H4  deg.[SEC. 1304. BOARD OF DIRECTORS.

  [(a) In General.--The powers of the Corporation are vested in 
the Board of Directors.
  [(b) Appointment.--The Board of Directors shall consist of 5 
individuals, to be appointed by the President by and with the 
advice and consent of the Senate. The President shall designate 
a Chairman of the Board from among members of the Board.
  [(c) Qualifications.--Members of the Board shall be citizens 
of the United States. No member of the Board shall be an 
employee of the Corporation or have any direct financial 
relationship with the Corporation other than that of being a 
member of the Board.
  [(d) Terms.--
          [(1) In general.--Except as provided in paragraph 
        (2), members of the Board shall serve 5-year terms or 
        until the election of a new Board of Directors under 
        section 1704, whichever comes first.
          [(2) Initial members.--Of the members first appointed 
        to the Board--
                  [(A) 1 shall be appointed for a 1-year term;
                  [(B) 1 shall be appointed for a 2-year term;
                  [(C) 1 shall be appointed for a 3-year term; 
                and
                  [(D) 1 shall be appointed for a 4-year term.
          [(3) Reappointment.--Members of the Board may be 
        reappointed by the President, by and with the advice 
        and consent of the Senate.
  [(e) Vacancies.--Upon the occurrence of a vacancy on the 
Board, the President by and with the advice and consent of the 
Senate shall appoint an individual to fill such vacancy for the 
remainder of the applicable term.
  [(f) Meetings and Quorum.--The Board shall meet at any time 
pursuant to the call of the Chairman and as provided by the 
bylaws of the Corporation, but not less than quarterly. Three 
voting members of the Board shall constitute a quorum. A 
majority of the Board shall adopt and from time to time may 
amend bylaws for the operation of the Board.
  [(g) Powers.--The Board shall be responsible for general 
management of the Corporation and shall have the same 
authority, privileges, and responsibilities as the board of 
directors of a private corporation incorporated under the 
District of Columbia Business Corporation Act.
  [(h) Compensation.--Members of the Board shall serve on a 
part-time basis and shall receive per diem, when engaged in the 
actual performance of Corporation duties, plus reimbursement 
for travel, subsistence, and other necessary expenses incurred 
in the performance of their duties.
  [(i) Membership of Secretary of Treasury.--The President may 
appoint the Secretary of the Treasury or his designee to serve 
as a member of the Board or as a nonvoting, ex officio member 
of the Board.
  [(j) Conflict of Interest Requirements.--No director, 
officer, or other management level employee of the Corporation 
may have a financial interest in any customer, contractor, or 
competitor of the Corporation or in any business that may be 
adversely affected by the success of the Corporation.]

SEC. 1305. \1\ EMPLOYEES OF THE CORPORATION.

    \1\ Section 1201(13) of the Atomic Energy Act of 1954, as added by 
this bill, defines the term ``privatization date'' as the date on which 
100 percent of ownership of the Corporation has been transferred to 
private investors.
---------------------------------------------------------------------------
  [(a) Appointment.--The Board shall appoint such officers and 
employees as are necessary for the transaction of its business.
  [(b) Compensation, Duties, and Removal.--The Board shall, 
without regard to section 5301 of title 5, United States Code, 
fix the compensation of all officers and employees of the 
Corporation, define their duties, and provide a system of 
organization to fix responsibility and promote efficiency. Any 
officer or employee of the Corporation may be removed in the 
discretion of the Board.
  [(c) Applicable Criteria.--The Board shall ensure that the 
personnel function and organization is consistent with the 
principles of section 2301(b) of title 5, United States Code, 
relating to merit system principles. Officers and employees 
shall be appointed, promoted, and assigned on the basis of 
merit and fitness, and other personnel actions shall be 
consistent with the principles of fairness and due process but 
without regard to those provisions of title 5 of the United 
States Code governing appointments and other personnel actions 
in the competitive service.
  [(d) Treatment of Persons Employed Prior to Transition 
Date.--Compensation, benefits, and other terms and conditions 
of employment in effect immediately prior to the transition 
date, whether provided by statute or by rules of the Department 
or the executive branch, shall continue to apply to officers 
and employees who transfer to the Corporation from other 
Federal employment until changed by the Board.
  [(e) Protection of Existing Employees.--
  [(1) In general.--It is the purpose of this subsection to 
ensure that the establishment of the Corporation pursuant to 
this chapter shall not result in any adverse effects on the 
employment rights, wages, or benefits of employees at 
facilities that are operated, directly or under contract, in 
the performance of the functions vested in the Corporation.
          [(2) Applicability of existing collective bargaining 
        agreement.--Any employer (including the Corporation) at 
        a facility described in paragraph (1) shall abide by 
        the terms of a collective bargaining agreement in 
        effect on April 30, 1991, at each individual facility 
        until--
                  [(A) the earlier of the date on which a new 
                bargaining agreement is signed; or
                  [(B) the end of the 2-year period beginning 
                on the date of the enactment of this title.
          [(3) Applicability of nlra.--Except as specifically 
        provided in this subsection, the Corporation is subject 
        to the provisions of the National Labor Relations Act 
        (29 U.S.C. 151 et seq.).]
  (a) In General.--
          (1) Privatization shall not diminish the accrued, 
        vested pension benefits of employees of the 
        Corporation's operating contractor at the two gaseous 
        diffusion plants.
          (2) In the event that the private corporation 
        terminates or changes the contractor at either or both 
        of the gaseous diffusion plants, the plan sponsor or 
        other appropriate fiduciary of the pension plan 
        covering employees of the prior operating contractor 
        shall arrange for the transfer of all plan assets and 
        liabilities relating to accrued pension benefits of 
        such plan's participants and beneficiaries from such 
        plant to a pension plan sponsored by the new contractor 
        or the private corporation, as the case may be.
          (3) Any employer (including the private corporation 
        or any contractor of the private corporation) at a 
        gaseous diffusion plant shall abide by the terms of any 
        unexpired collective bargaining agreement covering 
        employees in bargaining units at the plant and in 
        effect on the privatization date until the expiration 
        of the agreement.
          (4) In the event of a plant closing or mass layoff 
        (as such terms are defined in section 2101(a)(2) and 
        (3) of title 29, United States Code) at either of the 
        gaseous diffusion plants, the Secretary of Energy shall 
        treat such plant as a Department of Energy defense 
        nuclear facility and any person employed by an 
        operating contractor on the privatization date at 
        either plant as a Department of Energy employee for 
        purposes of sections 3161 through 3163 of the National 
        Defense Authorization Act for Fiscal Year 1993 (42 
        U.S.C. 7274h-7274j).
          (5) The Department of Energy and the private 
        corporation shall continue to fund postretirement 
        health benefits for persons employed by an operating 
        contractor at either of the gaseous diffusion plants at 
        substantially the same level of coverage as eligible 
        retirees are entitled to receive on the privatization 
        date, consistent with subparagraphs (A) through (C), 
        except that the Department of Energy, the private 
        corporations and the operating contractor shall have 
        the right to implement cost-saving measures, including 
        (but not limited to) preferred provider organizations, 
        managed care programs, mandatory second opinions before 
        surgery or other medical procedures, and mandatory use 
        of generic drugs, that do not materially diminish the 
        overall quality of the medical care provided--
                  (A) persons eligible for this coverage shall 
                be limited to persons who retired from active 
                employment at one of the gaseous diffusion 
                plants as of the privatization date, as vested 
                participants in a pension plan maintained 
                either by the Corporation's operating 
                contractor or by a contractor employed prior to 
                July 1, 1993, by the Department of Energy to 
                operate either of the gaseous diffusion plants 
                and persons who, as of the privatization date, 
                are employed by the Corporation's operating 
                contractor and are vested participants in a 
                pension plan maintained either by the 
                Corporation's operating contractor or by a 
                contractor employed prior to July 1, 1993, by 
                the Department of Energy to operate either of 
                the gaseous diffusion plants;
                  (B) for persons who retired from employment 
                with an operating contractor prior to July 1, 
                1993, the Department of Energy shall fund the 
                entire cost of postretirement health benefits; 
                and
                  (C) for persons who retire from employment 
                with an operating contractor after July 1, 
                1993, the Department of Energy and the private 
                corporation shall fund the cost of 
                postretirement health benefits in proportion to 
                the retired persons' years and months of 
                service at a gaseous diffusion plant under 
                their respective management.
  [(4)] (b) Benefits of [transferees and detailees.--At the 
request of the Board and subject to the approval of the 
Secretary, an employee of the Department may be transferred or 
detailed as provided for in section 1315, to the Corporation 
without any loss in accrued benefits or standing within the 
Civil Service System.] Transferees.--For those employees who 
accept transfer to the Corporation from other Federal 
employment, it shall be their option as to whether to have any 
accrued retirement benefits transferred to a retirement system 
established by the Corporation or to retain their coverage 
under either the Civil Service Retirement System or the Federal 
Employees' Retirement System, as applicable, in lieu of 
coverage by the Corporation's retirement system. For those 
employees electing to remain with one of the Federal retirement 
systems, the Corporation shall withhold pay and make such 
payments as are required under the Federal retirement system. 
[For those Department employees detailed, the Department shall 
offer those employees a position of like grade, compensation, 
and proximity to their official duty station after their 
services are no longer required by the Corporation.]

 H4  deg.[SEC. 1306. AUDITS.

  [(a) Independent Audits.--
          [(1) In general.--The financial statements of the 
        Corporation shall be prepared in accordance with 
        generally accepted accounting principles and shall be 
        audited annually by an independent certified public 
        accountant in accordance with auditing standards issued 
        by the Comptroller General. Such auditing standards 
        shall be consistent with the private sector's generally 
        accepted auditing standards.
          [(2) Review by gao.--The Comptroller General may 
        review any audit of the Corporation's financial 
        statements conducted under paragraph (1). The 
        Comptroller General shall report to the Congress and 
        the Corporation the results of any such review and 
        shall include in such report appropriate 
        recommendations.
  [(b) GAO Audits.--
          [(1) In general.--The Comptroller General may audit 
        the financial statements of the Corporation for any 
        year in the manner provided in subsection (a)(1).
          [(2) Reimbursement by corporation.--The Corporation 
        shall reimburse the Comptroller General for the full 
        cost of any audit conducted under this subsection, as 
        determined by the Comptroller General.
  [(c) Availability of Books and Records.--All books, accounts, 
financial records, reports, files, papers, and other property 
belonging to or in use by the Corporation and its auditor that 
the Comptroller General considers necessary to the performance 
of any audit or review under this section shall be made 
available to the Comptroller General, subject to section 1314.
  [(d) Treatment of GAO Audits.--Activities the Comptroller 
General conducts under this section shall be in lieu of any 
other audit of the financial transactions of the Corporation 
the Comptroller General is required to make under chapter 91 of 
title 31, United States Code, or other law.

 H4  deg.[SEC. 1307. ANNUAL REPORTS.

  [(a) In General.--The Corporation shall prepare and submit an 
annual report of its activities to the President and the 
Congress. This report shall contain--
          [(1) a general description of the Corporation's 
        operations;
          [(2) a summary of the Corporation's operating and 
        financial performance, including an explanation of the 
        decision to pay or not pay dividends;
          [(3) copies of audit reports prepared under section 
        1305
          [(4) the information required under regulations 
        issued under section 13 of the Securities Exchange Act 
        of 1934 (15 U.S.C. 78m); and
          [(5) an identification and assessment of any 
        impairment of capital or ability of the Corporation to 
        comply with this title.
  [(b) Deadline.--The report shall be completed not later than 
150 days following the close of each of the Corporation's 
fiscal years and shall accurately reflect the financial 
position of the Corporation at fiscal year end.

 H4  deg.[SEC. 1308. ACCOUNTS.

  [(a) Establishment of United States Enrichment Corporation 
Fund.--There is established in the Treasury of the United 
States a revolving fund, to be known as the ``United States 
Enrichment Corporation Fund'', which shall be available to the 
Corporation, without need for further appropriation and without 
fiscal year limitation, for carrying out its purposes, 
functions, and powers, and which shall not be subject to 
apportionment under subchapter II of chapter 15 of title 31, 
United States Code.
  [(b) Transfer of Unexpended Balances.--On the transfer date, 
the Secretary shall, without need of further appropriation, 
transfer to the Corporation the unexpended balance of 
appropriations and other monies available to the Department 
(inclusive of funds set aside for accounts payable), and 
accounts receivable which are related to functions and 
activities acquired by the Corporation from the Department 
pursuant to this title, including all advance payments.

 H4  deg.[SEC. 1309. OBLIGATIONS.

  [(a) Issuance.--
          [(1) In general.--The Corporation may issue and sell 
        bonds, notes, and other evidences of indebtedness 
        (collectively referred to in this title as ``bonds''), 
        except that the Corporation may not issue or sell bonds 
        for the purpose of constructing new uranium enrichment 
        facilities or conducting directly related 
        preconstruction activities. Borrowing under this 
        paragraph during any fiscal year ending before October 
        1, 1996, shall be subject to approval in appropriation 
        Acts.
          [(2) Use of revenues.--The Corporation may pledge and 
        use its revenues for payment of the principal of and 
        interest on its bonds, for their purchase or 
        redemption, and for other purposes incidental to these 
        functions, including creation of reserve funds and 
        other funds that may be similarly pledged and used.
          [(3) Agreements with holders and trustees.--The 
        Corporation may enter into binding covenants with the 
        holders and trustees of its bonds with respect to--
                  [(A) the establishment of reserve and other 
                funds;
                  [(B) stipulations concerning the subsequent 
                issuance of bonds; and
                  [(C) other matters not inconsistent with this 
                title;
        that the Corporation determines necessary or desirable 
        to enhance the marketability of the bonds.
  [(b) Not Obligations of United States.--Bonds issued by the 
Corporation under this section shall not be obligations of, or 
guaranteed as to principal or interest by, the United States, 
and the bonds shall so plainly state.
  [(c) Terms and Conditions.--
          [(1) Negotiable; maturity.--Bonds issued by the 
        Corporation under this section shall be negotiable 
        instruments unless otherwise specified in the bond and 
        shall mature not more than 50 years after their date of 
        issuance.
          [(2) Role of secretary of the treasury.--
                  [(A) Right of disapproval.--The Corporation 
                may set the terms and conditions of bonds 
                issued under this section, subject to 
                disapproval of such terms and conditions by the 
                Secretary of the Treasury within 5 days after 
                the Secretary of the Treasury is notified of 
                the following terms and conditions of the 
                bonds:
                          [(i) Their forms and denominations.
                          [(ii) The times, amounts, and prices 
                        at which they are sold.
                          [(iii) Their rates of interest.
                          [(iv) The terms at which they may be 
                        redeemed by the Corporation before 
                        maturity.
                          [(v) The priority of their claims on 
                        the Corporation's net revenues with 
                        respect to principal and interest 
                        payments.
                          [(vi) Any other terms and conditions.
                  [(B) Inapplicability of right to prescribe 
                terms.--Section 9108(a) of title 31, United 
                States Code, shall not apply to the 
                Corporation.
  [(d) Inapplicability of securities requirements.--The 
Corporation shall be considered an executive department of the 
United States for purposes of section 3(c) of the Securities 
Exchange Act of 1934 (15 U.S.C. 78c(c)).
  [(e) Inapplicability of FFB.--The Corporation shall not issue 
or sell any bonds to the Federal Financing Bank.

[SEC. 1310. EXEMPTION FROM TAXATION AND PAYMENTS IN LIEU OF TAXES.

  [(a) Exemption From Taxation.--In order to render financial 
assistance to those States and localities in which the 
facilities of the Corporation are located, the Corporation 
shall, beginning in fiscal year 1998, make payments to State 
and local governments as provided in this section. These 
payments shall be in lieu of any and all State and local taxes 
on the real and personal property of the Corporation. All 
property of the Corporation is expressly exempted from taxation 
in any manner or form by any State, county, or other local 
government entity including State, county, or other local 
government sales tax.
  [(b) Payments in Lieu of Taxes.--Beginning in fiscal year 
1998, the Corporation shall make annual payments, in amounts 
determined by the Corporation to be fair and reasonable, to the 
State and local governmental agencies having tax jurisdiction 
in any area where facilities of the Corporation are located. In 
making these determinations, the Corporation shall be guided by 
the following criteria:
          [(1) The Corporation shall take into account the 
        customs and practices prevailing in the area with 
        respect to appraisal, assessment, and classification of 
        industrial property and any special considerations 
        extended to large-scale industrial operations.
          [(2) The payment made to any taxing authority for any 
        period shall not be less than the payments that would 
        have been made to the taxing authority for the same 
        period by the Department and its cost-type contractors 
        on behalf of the Department with respect to property 
        that has been transferred to the Corporation under 
        section 1404 and that would have been attributable to 
        the ownership, management, operation, and maintenance 
        of the Department's uranium enrichment facilities, 
        applying the laws and policies prevailing immediately 
        prior to the transition date.
  [(c) Time of Payments.--Payments shall be made by the 
Corporation at the time when payments of taxes by taxpayers to 
each taxing authority are due and payable.
  [(d) Determination of Amount Due.--The determination by the 
Corporation of the amounts due under this section shall be 
final and conclusive.

 H4  deg.[SEC. 1311. COOPERATION WITH OTHER AGENCIES.

  [The Corporation may request to use on a reimbursable basis 
the available services, equipment, personnel, and facilities of 
agencies of the United States, and on a similar basis may 
cooperate with such agencies in the establishment and use of 
services, equipment, and facilities of the Corporation. 
Further, the Corporation may confer with and avail itself of 
the cooperation, services, records, and facilities of State, 
territorial, municipal, or other local agencies.

 H4  deg.[SEC. 1312. APPLICABILITY OF CERTAIN FEDERAL LAWS.

  [(a) Antitrust Laws.--The Corporation shall conduct its 
activities in a manner consistent with the policies expressed 
in the following antitrust laws:
          [(1) The Sherman Act (15 U.S.C. 1-7).
          [(2) The Clayton Act (15 U.S.C. 12-27).
          [(3) Sections 73 and 74 of the Wilson Tariff Act (15 
        U.S.C. 8 and 9).
  [(b) Environmental Laws.--The Corporation shall be subject 
to, and comply with, all Federal and State, interstate, and 
local environmental laws and requirements, both substantive and 
procedural, in the same manner, and to the same extent, as any 
person who is subject to such laws and requirements. For 
purposes of enforcing any such law or substantive or procedural 
requirements (including any injunctive relief, administrative 
order, or civil or administrative penalty or fine) against the 
Corporation, the United States expressly waives any immunity 
otherwise applicable to the Corporation. For the purposes of 
this subsection, the term ``person'' means an individual, 
trust, firm, joint stock company, corporation, partnership, 
association, State, municipality, or political subdivision of a 
State.
  [(c) OSHA Requirements.--Notwithstanding sections 3(5), 
4(b)(1), and 19 of the Occupational Safety and Health Act of 
1970 (29 U.S.C. 652(5), 653(b)(1), and 668)), the Corporation 
shall be subject to, and comply with, such Act and all 
regulations and standards promulgated thereunder in the same 
manner, and to the same extent, as an employer is subject to 
such Act. For the purposes of enforcing such Act (including any 
injunctive relief, administrative order, or civil, 
administrative, or criminal penalty or fine) against the 
Corporation, the United States expressly waives any immunity 
otherwise applicable to the Corporation.
  [(d) Labor Standards.--The Act of March 3, 1931 (known as the 
Davis-Bacon Act) (40 U.S.C. 276a et seq.) and the Service 
Contract Act of 1965 (41 U.S.C. 351 et seq.) shall apply to the 
Corporation. All laborers and mechanics employed on the 
construction, alteration, or repair of projects funded, in 
whole or in part, by the Corporation shall be paid wages at 
rates not less than those prevailing on projects of a similar 
character in the locality as determined by the Secretary of 
Labor in accordance with such Act of March 3, 1931. The 
Secretary of Labor shall have, with respect to the labor 
standards specified in this subsection, the authority and 
functions set forth in Reorganization Plan Numbered 14 of 1950 
(15 F.R. 3176, 64 Stat. 1267) and the Act of June 13, 1934 (40 
U.S.C. 276c).
  [(e) Energy Reorganization Act Requirements.--The Corporation 
is subject to the provisions of section 210 of the Energy 
Reorganization Act of 1974 (42 U.S.C. 5850) to the same extent 
as an employer subject to such section, and, with respect to 
the operation of the facilities leased by the Corporation, 
section 206 of the Energy Reorganization Act of 1974 (42 U.S.C. 
5846) shall apply to the directors and officers of the 
Corporation.
  [(f) Exemption From Federal Property Requirements.--The 
Corporation shall not be subject to the Federal Property and 
Administrative Services Act of 1949 (41 U.S.C. 471 et seq.).

 H4  deg.[SEC. 1313. SECURITY.

  [Any references to the term ``Commission'' or to the 
Department in sections 161k., 221a., and 230 shall be 
considered to include the Corporation.

 H4  deg.[SEC. 1314. CONTROL OF INFORMATION.

  [(a) In General.--Except as provided in subsection (b), the 
Corporation may protect trade secrets and commercial or 
financial information to the same extent as a privately owned 
corporation.
  [(b) Other Applicable Laws.--Section 552(d) of title 5, 
United States Code, shall apply to the Corporation, and such 
information shall be subject to the applicable provisions of 
law protecting the confidentiality of trade secrets and 
business and financial information, including section 1905 of 
title 18, United States Code.

 H4  deg.[SEC. 1315. TRANSITION.

  [(a) Transition Manager.--Within 30 days after the date of 
the enactment of this title, the President shall appoint a 
Transition Manager, who shall serve at the pleasure of the 
President until a quorum of the Board has been appointed and 
confirmed in accordance with section 1304.
  [(b) Powers.--
          [(1) In general.--Until a quorum of the Board has 
        qualified, the Transition Manager shall exercise the 
        powers and duties of the Board and shall be responsible 
        for taking all actions needed to effect the transfer of 
        the uranium enrichment enterprise from the Secretary to 
        the Corporation on the transition date.
          [(2) Continuation until board has quorum.--In the 
        event that a quorum of the Board has not qualified by 
        the transition date, the Transition Manager shall 
        continue to exercise the powers and duties of the Board 
        until a quorum has qualified.
  [(c) Ratification of Transition Manager's Actions.--All 
actions taken by the Transition Manager before the 
qualification of a quorum of the Board shall be subject to 
ratification by the Board.
  [(d) Responsibilities of Secretary.--Before the transition 
date, the Secretary shall--
          [(1) continue to be responsible for the management 
        and operation of the uranium enrichment plants
          [(2) provide funds, to the extent provided in 
        appropriations Acts, to the Transition Manager to pay 
        salaries and expenses;
          [(3) delegate Department employees to assist the 
        Transition Manager in meeting his responsibilities 
        under this section; and
          [(4) assist and cooperate with the Transition Manager 
        in preparing for the transfer of the uranium enrichment 
        enterprise to the Corporation on the transition date.
  [(e) Transition Date.--The transition date shall be July 1, 
1993.
  [(f) Detail of Personnel.--For the purpose of continuity of 
operations, maintenance, and authority, the Department shall 
detail, for up to 18 months after the date of the enactment of 
this title, appropriate Department personnel as may be required 
in an acting capacity, until such time as a Board is confirmed 
and top officers of the Corporation are hired. The Corporation 
shall reimburse the Department and its contractors for the 
detail of such personnel.

[SEC. 1316. WORKING CAPITAL ACCOUNT.

  [There shall be established within the Corporation a Working 
Capital Account in which the Corporation may retain all revenue 
necessary for legitimate business expenses, or investments, 
related to carrying out its purposes.]

     CHAPTER 24--RIGHTS, PRIVILEGES, AND ASSETS OF THE CORPORATION

 H4  deg.SEC. 1401. MARKETING AND CONTRACTING AUTHORITY.

  (a) [Exclusive Marketing Agent.--The Corporation shall act as 
the exclusive marketing agent on behalf of the United States 
Government for entering into contracts for providing enriched 
uranium (including low-enriched uranium derived from highly 
enriched uranium) and uranium enrichment and related services.] 
Marketing Authority.--The Department may not market enriched 
uranium (including low-enriched uranium derived from highly 
enriched uranium), or uranium enrichment and related services, 
after the transition date.
  (b) Transfer of Contracts.--
          (1) * * *
          (2) Exceptions.--
                  (A) TVA settlement.--The rights and 
                responsibilities of the Department under the 
                settlement agreement with the Tennessee Valley 
                Authority, filed on December 18, 1987, with the 
                United States Claims Court, shall not transfer 
                to the Corporation.
                  (B) Nontransferable power contracts.--If the 
                Secretary determines that a power purchase 
                contract executed by the Department prior to 
                the transition date cannot be transferred under 
                its terms, the Secretary may continue to 
                receive power under the contract and resell 
                such power to the Corporation at cost. The 
                privatization of the Corporation shall not 
                affect the terms of, or the rights or 
                obligations of the parties to, any such power 
                purchase contract.
                  (C) Nonpower applications.--Contracts for 
                enriched uranium and uranium services in 
                existence as of the date of the enactment of 
                this title for research and development or 
                other nonpower applications shall remain with 
                the Department. At the request of the 
                Department, the Corporation, in consultation 
                with the Department, may enter into such 
                contracts it determines to be appropriate.
          (3) Effect of transfer.--
                  (A) As a result of the transfer pursuant to 
                paragraph (1), all rights, privileges, and 
                benefits under such contracts, agreements, and 
                leases, including the right to amend, modify, 
                extend, revise, or terminate any of such 
                contracts, agreements, or leases were 
                irrevocably assigned to the Corporation for its 
                exclusive benefit.
                  (B) Notwithstanding the transfer pursuant to 
                paragraph (1), the United States shall remain 
                obligated to the parties to the contracts, 
                agreements, and leases transferred pursuant to 
                paragraph (1) for the performance of the 
                obligations of the United States thereunder 
                during the term thereof. The Corporation shall 
                reimburse the United States for any amount paid 
                by the United States in respect of such 
                obligations arising after the privatization 
                date to the extent such amount is a legal and 
                valid obligation of the Corporation then due.
                  (C) After the privatization date, upon any 
                material amendment, modification, extension, 
                revision, replacement, or termination of any 
                contract, agreement, or lease transferred under 
                paragraph (1), the United States shall be 
                released from further obligation under such 
                contract, agreement, or lease, except that such 
                action shall not release the United States from 
                obligations arising under such contract, 
                agreement, or lease prior to such time.

 H4  deg.[SEC. 1402. PRICING.

  [(a) Services Provided to Commercial Customers.--The 
Corporation shall establish prices for its products, materials, 
and services provided to customers other than the Department on 
a basis that will allow it to attain the normal business 
objectives of a profitmaking corporation.
  [(b) Services Provided to DOE.--The Corporation shall charge 
prices to the Department for uranium enrichment services 
provided under section 1303(9) on a basis that will allow it to 
recover its costs, on a yearly basis, for providing products, 
materials, and services, and provide for a reasonable profit.]

SEC. 1402. PRICING.

  The Corporation shall establish prices for its products, 
materials, and services provided to customers on a basis that 
will allow it to attain the normal business objectives of a 
profitmaking corporation.

SEC. 1403. LEASING OF GASEOUS DIFFUSION FACILITIES OF DEPARTMENT.

  (a) * * *
          * * * * * * *
  (h) Low-Level Radioactive Waste and Mixed Waste.--
          (1) Responsibility of the department; costs.--
                  (A) With respect to low-level radioactive 
                waste and mixed waste generated by the 
                Corporation as a result of the operation of the 
                facilities and related property leased by the 
                Corporation pursuant to subsection (a) or as a 
                result of treatment of such wastes at a 
                location other than the facilities and related 
                property leased by the Corporation pursuant to 
                subsection (a) the Department, at the request 
                of the Corporation, shall--
                          (i) accept for treatment or disposal 
                        of all such wastes for which treatment 
                        or disposal technologies and capacities 
                        exist, whether within the Department or 
                        elsewhere; and
                          (ii) accept for storage (or 
                        ultimately treatment or disposal) all 
                        such wastes for which treatment and 
                        disposal technologies or capacities do 
                        not exist, pending development of such 
                        technologies or availability of such 
                        capacities for such wastes.
                  (B) All low-level wastes and mixed wastes 
                that the Department accepts for treatment, 
                storage, or disposal pursuant to subparagraph 
                (A) shall, for the purpose of any permits, 
                licenses, authorizations, agreements, or orders 
                involving the Department and other Federal 
                agencies or State or local governments, be 
                deemed to be generated by the Department and 
                the Department shall handle such wastes in 
                accordance with any such permits, licenses, 
                authorizations, agreements, or orders. The 
                Department shall obtain any additional permits, 
                licenses, or authorizations necessary to handle 
                such wastes, shall amend any such agreements or 
                orders as necessary to handle such wastes, and 
                shall handle such wastes in accordance 
                therewith.
                  (C) The Corporation shall reimburse the 
                Department for the treatment, storage, or 
                disposal of low-level radioactive waste or 
                mixed waste pursuant to subparagraph (A) in an 
                amount equal to the Department's costs but in 
                no event greater than an amount equal to that 
                which would be charged by commercial, State, 
                regional, or interstate compact entities for 
                treatment, storage, or disposal of such waste.
          (2) Agreements with other persons.--The Corporation 
        may also enter into agreements for the treatment, 
        storage, or disposal of low-level radioactive waste and 
        mixed waste generated by the Corporation as a result of 
        the operation of the facilities and related property 
        leased by the Corporation pursuant to subsection (a) 
        with any person other than the Department that is 
        authorized by applicable laws and regulations to treat, 
        store, or dispose of such wastes.

[SEC. 1404. CAPITAL STRUCTURE OF CORPORATION.

  [(a) Capital Stock.--
          [(1) Issuance to secretary of the treasury.--The 
        Corporation shall issue capital stock representing an 
        equity investment equal to the greater of--
                  [(A) $3,000,000,000; or
                  [(B) the book value of assets transferred to 
                the Corporation, as reported in the Uranium 
                Enrichment Annual Report for fiscal year 1991, 
                modified to reflect continued depreciation and 
                other usual changes that occur up to the 
                transfer date.
        The Secretary of the Treasury shall hold such stock for 
        the United States, except that all rights and duties 
        pertaining to management of the Corporation shall 
        remain vested in the Board.
          [(2) Restriction on transfers of stock by united 
        states.--The capital stock of the Corporation shall not 
        be sold, transferred, or conveyed by the United States, 
        except to carry out the privatization of the 
        Corporation under section 1502.
          [(3) Annual assessment.--The Secretary of the 
        Treasury shall annually assess the value of the stock 
        held by the Secretary under paragraph (1) and submit to 
        the Congress a report setting forth such value. The 
        annual assessment of the Secretary shall be subject to 
        review by an independent auditor.
  [(b) Payment of Dividends.--The Corporation shall pay into 
miscellaneous receipts of the Treasury of the United States or 
such other fund as is provided by law, dividends on the capital 
stock, out of earnings of the Corporation, as a return on the 
investment represented by such stock. Until privatization 
occurs under section 1502, the Corporation shall pay as 
dividends to the Treasury of the United States all net revenues 
remaining at the end of each fiscal year not required for 
operating expenses or for deposit into the Working Capital 
Account established in section 1316.
  [(c) Prohibition on Additional Federal Assistance.--Except as 
otherwise specifically provided in this title, the Corporation 
shall receive no appropriations, loans, or other financial 
assistance from the Federal Government.
  [(d) Sole Recovery of Unrecovered Costs.--Receipt by the 
United States of the proceeds from the sale of stock issued by 
the Corporation under subsection (a)(1), and the dividends paid 
under subsection (b), shall constitute the sole recovery by the 
United States of previously unrecovered costs (including 
depreciation and imputed interest on original plant investments 
in the Department's gaseous diffusion plants) that have been 
incurred by the United States for uranium enrichment activities 
prior to the transition date.

 H4  deg.[SEC. 1405. PATENTS AND INVENTIONS.

  [The Corporation may at any time apply to the Department for 
a patent license for the use of an invention or discovery 
useful in the production or utilization of special nuclear 
material or atomic energy covered by a patent when the patent 
has not been declared to be affected with the public interest 
under section 153 a. and when use of the patent is within the 
Corporation's authority. An application shall constitute an 
application under section 153 c. subject to section 153 c., d., 
e., f., g., and h.]

 H4  deg.SEC. 1406. LIABILITIES.

  (a) Liabilities Based on Operations Before Transition and 
Privatization.--Except as otherwise provided in this title, all 
liabilities attributable to operation of the uranium enrichment 
enterprise before the transition date shall remain direct 
liabilities of the Department. As of the privatization date, 
all liabilities attributable to the operation of the 
Corporation from the transition date to the privatization date 
shall be direct liabilities of the United States.
  (b) Judgments Based on Operations Before Transition and 
Privatization.--Any judgment entered against the Corporation 
imposing liability arising out of the operation of the uranium 
enrichment enterprise before the transition date shall be 
considered a judgment against and shall be payable solely by 
the Department. As of the privatization date, any judgment 
entered against the Corporation imposing liability arising out 
of the operation of the Corporation from the transition date to 
the privatization date shall be considered a judgment against 
the United States.
  (c) Representation.--With regard to any claim seeking to 
impose liability under subsection (a) or (b), the United States 
shall be represented by the Department of Justice.
  (d) Judgments Based on Operations After Transition and 
Privatization.--Any judgment entered against the Corporation 
arising from operations of the Corporation on or after [the 
transition date] the privatization date (or, in the event the 
privatization date does not occur, the transition date) shall 
be payable solely by the Corporation from its own funds. The 
Corporation shall not be considered a Federal agency for 
purposes of chapter 171 of title 28, United States Code.

SEC. 1408. URANIUM TRANSFERS AND SALES.

  (a) Transfers and Sales by the Secretary.--The Secretary 
shall not provide enrichment services or transfer or sell any 
uranium (including natural or enriched uranium in any form) to 
any person except as provided in this section.
  (b) Russian HEU.--
          (1) Transfers.--Prior to December 31, 1996, the 
        United States Executive Agent under the Russian HEU 
        Agreement shall transfer to the Secretary without 
        charge an amount of uranium hexafluoride equivalent to 
        the natural uranium component of low-enriched uranium 
        derived from at least 18 metric tons of highly enriched 
        uranium purchased from the Russian Executive Agent 
        under the Russian HEU Agreement. The quantity of such 
        uranium hexafluoride delivered to the Secretary shall 
        be based on a tails assay of 0.30 U235. Title to 
        uranium hexafluoride delivered to the Secretary 
        pursuant to this paragraph shall transfer to the 
        Secretary upon delivery of such material to the 
        Secretary. Uranium hexafluoride delivered to the 
        Secretary pursuant to this paragraph shall be deemed to 
        be of Russian origin.
          (2) Contracts.--Within 7 years of the date of 
        enactment of the USEC Privatization Act, the Secretary 
        shall enter into contracts to sell the uranium 
        hexafluoride transferred to the Secretary pursuant to 
        paragraph (1). Such uranium hexafluoride shall be 
        sold--
                  (A) at any time for use in the United States 
                for the purpose of overfeeding;
                  (B) at any time for use outside the United 
                States; and
                  (C) for consumption by end users in the 
                United States not prior to January 1, 2002, in 
                volumes not to exceed 3 million pounds U3O8 
                equivalent per year.
          (3) Uranium hexafluoride.--With respect to all low-
        enriched uranium that is delivered to the United States 
        Executive Agent under the Russian HEU Agreement after 
        January 1, 1997, the United States Executive Agent 
        shall, upon request of the Russian Executive Agent, 
        deliver to the Russian Executive Agent an amount of 
        uranium hexafluoride equivalent to the natural uranium 
        component of such low-enriched uranium simultaneously 
        with the delivery of such low-enriched uranium. The 
        quantity of such uranium hexafluoride delivered to the 
        Russian Executive Agent shall be based on a tails assay 
        of 0.30 U235. Title to uranium hexafluoride delivered 
        to the Russian Executive Agent pursuant to this 
        paragraph shall transfer to the Russian Executive Agent 
        upon delivery of such material to the Russian Executive 
        Agent at a North American facility designated by the 
        Russian Executive Agent. Uranium hexafluoride delivered 
        to the Russian Executive Agent pursuant to this 
        paragraph shall be deemed to be of Russian origin. Such 
        uranium hexafluoride may be sold to any person or 
        entity consistent with the limitations on delivery to 
        end users set forth in this subsection. Nothing in this 
        subsection shall restrict the sale of the conversion 
        component of such uranium hexafluoride.
          (4) Independent party.--In the event that the Russian 
        Executive Agent does not request delivery of the 
        natural uranium component of any low-enriched uranium, 
        as contemplated in paragraph (3), within 90 days of the 
        date such low-enriched uranium is delivered to the 
        United States Executive Agent, then the United States 
        Executive Agent shall engage an independent party 
        through a competitive selection process to auction an 
        amount of uranium hexafluoride equivalent to the 
        natural uranium component of such low-enriched uranium. 
        Such independent party shall sell such uranium 
        hexafluoride to any person or entity consistent with 
        the limitations set forth in this subsection. The 
        independent entity shall pay to the Russian Executive 
        Agent the proceeds of any such auction less all 
        transaction and other administrative costs. The 
        quantity of such uranium hexafluoride auctioned shall 
        be based on a tails assay of 0.30 U235. Title to 
        uranium hexafluoride auctioned pursuant to this 
        paragraph shall transfer to the buyer of such material 
        upon delivery of such material to the buyer. Uranium 
        hexafluoride auctioned pursuant to this paragraph shall 
        be deemed to be of Russian origin.
          (5) Consumption.--Except as provided in paragraphs 
        (6) and (7), uranium hexafluoride delivered to the 
        Secretary under paragraph (1) or the Russian Executive 
        Agent under paragraph (3) or auctioned pursuant to 
        paragraph (4), may not be delivered for consumption by 
        end users in the United States prior to January 1, 1998 
        and thereafter only in accordance with the following 
        schedule:

                    Annual Maximum Deliveries to End Users
  Year              (millions lbs. U3O8 equivalent)
    1998-...........2 million lbs. U3O8 equivalent............
    1999-...........4 million lbs. U3O8 equivalent............
    2000-...........6 million lbs. U3O8 equivalent............
    2001-...........8 million lbs. U3O8 equivalent............
    2002-...........10 million lbs. U3O8 equivalent...........
    2003-...........12 million lbs. U3O8 equivalent...........
    2004-...........14 million lbs. U3O8 equivalent...........
    2005 and each ye16 million lbs. U3O8 equivalent...........

          (6) Sale.--Uranium hexafluoride delivered to the 
        Secretary under paragraph (1) or the Russian Executive 
        Agent under paragraph (3) or auctioned pursuant to 
        paragraph (4) may be sold at any time as Russian-origin 
        natural uranium in a sale with an equal portion of 
        U.S.-origin natural uranium pursuant to the Suspension 
        Agreement and in such case shall not be counted against 
        the annual maximum deliveries set forth in paragraph 
        (5).
          (7) Sale for use in the United States.--Uranium 
        hexafluoride delivered to the Secretary under paragraph 
        (1) or the Russian Executive Agent under paragraph (3) 
        or auctioned pursuant to paragraph (4) may be sold at 
        any time for use in the United States for the purpose 
        of overfeeding in the operations of enrichment 
        facilities.
  (c) Transfers to the corporation.--(1) Before the 
privatization date, the Secretary may transfer to the 
Corporation without charge the low enriched uranium from up to 
50 metric tons of highly enriched uranium and up to 7,000 
metric tons of natural uranium, subject to the restrictions in 
subsection (b)(2).
  (2) The Corporation (or its successor) may not deliver for 
commercial end use--
          (A) any of the natural uranium transferred under this 
        subsection before January 1, 1998;
          (B) more than 10 percent of the natural uranium (by 
        uranium hexafluoride equivalent content) transferred 
        under this subsection or more than 4 million pounds, 
        whichever is less, in any calendar year after 1997; or
          (C) more than 800,000 separative work units of low-
        enriched uranium transferred under this subsection in 
        any calendar year.
  (d) Inventory Sales.--(1) In addition to the transfers 
authorized under subsection (b), the Secretary may, from time 
to time, sell natural and low-enriched uranium (including low-
enriched uranium derived from highly enriched uranium) from the 
Department of Energy's stockpile.
  (2) Except as provided in subsections (b) and (d), no sale or 
transfer of natural or low-enriched uranium shall be made 
unless--
          (A) the President determines that the material is not 
        necessary to national security needs,
          (B) the Secretary determines that the sale of the 
        material will not have an adverse impact on the 
        domestic uranium mining and enrichment industries, 
        taking into account the sales of uranium under the 
        Russian HEU Agreement and the Suspension Agreement, and
          (C) the price paid to the Secretary will not be less 
        than the fair market value of the material.
  (e) Government Transfers.--Notwithstanding subsection (c), 
the Secretary may transfer or sell low-enriched uranium--
          (1) to a federal agency if the material is 
        transferred for the use of the receiving agency without 
        any resale or transfer to another entity and the 
        material does not meet commercial specifications;
          (2) to any person for national security purposes, as 
        determined by the Secretary; or
          (3) to any state or local agency or nonprofit, 
        charitable, or educational institution for use other 
        than the generation of electricity for commercial use.

SEC. [1408.] 1409. PURCHASE OF HIGHLY ENRICHED URANIUM FROM FORMER 
                    SOVIET UNION.

  (a) In General.--The Corporation is authorized to negotiate 
the purchase of all highly enriched uranium made available by 
any State of the former Soviet Union under a government-to-
government agreement or shall assume the obligations of the 
Department under any contractual agreement that has been 
reached with any such State or any private entity before the 
transition date. The Corporation may only purchase this 
material so long as the quality of the material can be made 
suitable for use in commercial reactors.
  (b) Assessment of Potential Use.--The Corporation shall 
prepare an assessment of the potential use of highly enriched 
uranium in the business operations of the Corporation.
  (c) Plan for Blending and Conversion.--In the event that the 
agreement under subsection (a) provides for the Corporation to 
provide for the blending and conversion the assessment shall 
include a plan for such blending and conversion. The plan shall 
determine the least-cost approach to providing blending and 
conversion services, compatible with environmental, safety, 
security, and nonproliferation requirements. The plan shall 
include a competitive process that the Corporation shall use 
for selecting a provider of such services, including the public 
solicitation of proposals from the private sector to allow a 
determination of the least-cost approach.
  (d) Minimization of Impact on Domestic Industries.--The 
Corporation shall seek to minimize the impact on domestic 
industries (including uranium mining) of the sale of low-
enriched uranium derived from highly enriched uranium.

              CHAPTER 25--PRIVATIZATION OF THE CORPORATION

          * * * * * * *

SEC. 1502. PRIVATIZATION.

  (a) * * *
          * * * * * * *
  (d) Period for Congressional Review.--The Corporation may not 
implement the privatization plan [less than 60 days after 
notification of the Congress] less than 60 days after the date 
of the report to Congress by the Comptroller General under 
subsection (c).

SEC. 1503. ESTABLISHMENT OF PRIVATE CORPORATION.

  (a) Establishment.--
          (1) In general.--In order to facilitate 
        privatization, the Corporation may provide for the 
        establishment of a private corporation organized under 
        the laws of any of the several States. Such corporation 
        shall have among its purposes the following:
                  (A) To help maintain a reliable and 
                economical domestic source of uranium 
                enrichment services.
                  (B) To undertake any and all activities as 
                provided in its corporate charter.
          (2) Authorities.--The corporation established 
        pursuant to paragraph (1) shall be authorized to--
                  (A) enrich uranium, provide for uranium to be 
                enriched by others, or acquire enriched uranium 
                (including low-enriched uranium derived from 
                highly enriched uranium);
                  (B) conduct, or provide for conducting, those 
                research and development activities related to 
                uranium enrichment and related processes and 
                activities the corporation considers necessary 
                or advisable to maintain itself as a commercial 
                enterprise operating on a profitable and 
                efficient basis;
                  (C) enter into transactions regarding 
                uranium, enriched uranium, or depleted uranium 
                with--
                          (i) persons licensed under section 
                        53, 63, 103, or 104 in accordance with 
                        the licenses held by those persons;
                          (ii) persons in accordance with, and 
                        within the period of, an agreement for 
                        cooperation arranged under section 123; 
                        or
                          (iii) persons otherwise authorized by 
                        law to enter into such transactions;
                  (D) enter into contracts with persons 
                licensed under section 53, 63, 103, or 104, for 
                as long as the corporation considers necessary 
                or desirable, to provide uranium or uranium 
                enrichment and related services;
                  (E) enter into contracts to provide uranium 
                or uranium enrichment and related services in 
                accordance with, and within the period of, an 
                agreement for cooperation arranged under 
                section 123 or as otherwise authorized by law; 
                and
                  (F) take any and all such other actions as 
                are permitted by the law of the jurisdiction of 
                incorporation of the corporation.
          (3) Transfer of assets.--For purposes of implementing 
        the privatization, the Corporation may transfer some or 
        all of its assets and obligations to the corporation 
        established pursuant to this section, including--
                  (A) all of the Corporation's assets and 
                obligations, including all of the Corporation's 
                rights, duties, and obligations accruing 
                subsequent to the privatization date under 
                contracts, agreements, and leases entered into 
                by the Corporation before the privatization 
                date, including all uranium enrichment 
                contracts and power purchase contracts;
                  (B) all funds in accounts of the Corporation 
                held by the Treasury or on deposit with any 
                bank or other financial institution;
                  (C) all of the Corporation's rights, duties, 
                and obligations, accruing subsequent to the 
                privatization date, under the power purchase 
                contracts covered by section 1401(b)(2)(B);
                  (D) all of the Corporation's rights, duties, 
                and obligations, accruing subsequent to the 
                privatization date, under the lease agreement 
                between the Department and the Corporation 
                executed by the Department and the Corporation 
                pursuant to section 1403; and
                  (E) all of the Corporation's records, 
                including all of the papers and other 
                documentary materials, regardless of physical 
                form or chharacteristics, made or received by 
                the Corporation.
          (4) Merger or consolidation.--For purposes of 
        implementing the privatization, the Corporation may 
        merge or consolidate with the corporation established 
        pursuant to subsection (a)(1) if such action is 
        contemplated by the plan for privatization approved by 
        the President under section 1502(b). The Board shall 
        have exclusive authority to approve such merger or 
        consolidation and to take all further actions necessary 
        to consummate such merger or consolidation, and no 
        action by or in respect of shareholders shall be 
        required. The merger or consolidation shall be effected 
        in accordance with, and have the effects of a merger or 
        consolidation under, the laws of the jurisdiction of 
        incorporation of the surviving corporation, and all 
        rights and benefits provided under this title to the 
        Corporation shall apply to the surviving corporation as 
        if it were the Corporation.
  (b) OSHA Requirements.--For purposes of the regulation of 
radiological and nonradiological hazards under the Occupational 
Safety and Health Act of 1970, the corporation established 
pursuant to subsection (a)(1) shall be treated in the same 
manner as other employers licensed by the Nuclear Regulatory 
Commission. Any interagency agreement entered into between the 
Nuclear Regulatory Commission and the Occupational Safety and 
Health Administration governing the scope of their respective 
regulatory authorities shall apply to the corporation as if the 
corporation were a Nuclear Regulatory Commission licensee.
  (c) Legal Status of Private Corporation.--
          (1) Not federal agency.--The corporation established 
        pursuant to subsection (a)(1) shall not be an agency, 
        instrumentality, or establishment of the United States 
        Government and shall not be a Government corporation or 
        Government-controlled corporation.
          (2) No recourse against united states.--Obligations 
        of the corporation established pursuant to subsection 
        (a)(1) shall not be obligations of, or guaranteed as to 
        principal or interest by, the Corporation or the United 
        States, and the obligations shall so plainly state.
          (3) No claims court jurisdiction.--No action under 
        section 1491 of title 28, United States Code, shall be 
        allowable against the United States based on the 
        actions of the corporation established pursuant to 
        subsection (a)(1).
  (d) Board of Director's Election After Public Offering.--In 
the event that the privatization is implemented by means of a 
public offering, an election of the members of the board of 
directors of the Corporation by the shareholders shall be 
conducted before the end of the 1-year period beginning the 
date shares are first offered to the public pursuant to such 
public offering.
  (e) Adequate Proceeds.--The Secretary of Energy shall not 
allow the privatization of the Corporation unless before the 
sale date the Secretary determines that the estimated sum of 
the gross proceeds from the sale of the Corporation will be an 
adequate amount.

SEC. 1504. OWNERSHIP LIMITATIONS.

  (a) Securities Limitation.--In the event that the 
privatization is implemented by means of a public offering, 
during a period of 3 years beginning on the privatization date, 
no person, directly or indirectly, may acquire or hold 
securities representing more than 10 percent of the total votes 
of all outstanding voting securities of the Corporation.
  (b) Application.--Subsection (a) shall not apply--
          (1) to any employee stock ownership plan of the 
        Corporation,
          (2) to underwriting syndicates holding shares for 
        resale, or
          (3) in the case of shares beneficially held for 
        others, to commercial banks, broker-dealers, clearing 
        corporations, or other nominees.
  (c) Acquisitions.--No director, officer, or employee of the 
Corporation may acquire any securities, or any right to acquire 
securities, of the Corporation--
          (1) in the public offering of securities of the 
        Corporation in the implementation of the privatization,
          (2) pursuant to any agreement, arrangement, or 
        understanding entered into before the privatization 
        date, or
          (3) before the election of directors of the 
        Corporation under section 1503(d) on any terms more 
        favorable than those offered to the general public.

SEC. 1505. EXEMPTION FROM LIABILITY.

  (a) In General.--No director, officer, employee, or agent of 
the Corporation shall be liable, for money damages or 
otherwise, to any party if, with respect to the subject matter 
of the action, suit, or proceeding, such person was fulfilling 
a duty, in connection with any action taken in connection with 
the privatization, which such person in good faith reasonably 
believed to be required by law or vested in such person.
  (b) Exception.--The privatization shall be subject to the 
Securities Act of 1933 and the Securities Exchange Act of 1934. 
The exemption set forth in subsection (a) shall not apply to 
claims arising under such Acts or under the Constitution or 
laws of any State, territory, or possession of the United 
States relating to transactions in securities, which claims are 
in connection with a public offering implementing the 
privatization.
  (c) Securities Laws Applicable.--Any offering or sale of 
securities by the Corporation established pursuant to section 
1503(a)(1) shall be subject to the Securities Act of 1933, the 
Securities Exchange Act of 1934 and the provisions of the 
Constitution and laws of any State, territory, or possession of 
the United States relating to transactions in securities.

SEC. 1506. RESOLUTION OF CERTAIN ISSUES.

  (a) Corporation Actions.--Notwithstanding any provision of 
any agreement to which the Corporation is a party, the 
Corporation shall not be considered to be in breach, default, 
or violation of any such agreement because of any provision of 
this chapter or any action the Corporation is required to take 
under this chapter.
  (b) Right To Sue Withdrawn.--The United States hereby 
withdraws any stated or implied consent for the United States, 
or any agent or officer of the United States, to be sued by any 
person for any legal, equitable, or other relief with respect 
to any claim arising out of, or resulting from, acts or 
omissions under this chapter.

SEC. 1507. APPLICATION OF PRIVATIZATION PROCEEDS.

  The proceeds from the privatization shall be included in the 
budget baseline required by the Balanced Budget and Emergency 
Deficit Control Act of 1985 and shall be counted as an offset 
to direct spending for purposes of section 252 of such act, 
notwithstanding section 257(e) of such act.

 CHAPTER 26--AVLIS AND ALTERNATIVE TECHNOLOGIES FOR URANIUM ENRICHMENT

[SEC. 1601. ASSESSMENT BY UNITED STATES ENRICHMENT CORPORATION.

  [(a) In General.--The Corporation shall prepare an assessment 
of the economic viability of proceeding with the 
commercialization of AVLIS and alternative technologies for 
uranium enrichment in accordance with this chapter. The 
assessment shall include--
          [(1) an evaluation of market conditions together with 
        a marketing strategy;
          [(2) an analysis of the economic viability of 
        competing enrichment technologies;
          [(3) an identification of predeployment and capital 
        requirements for the commercialization of AVLIS and 
        alternative technologies for uranium enrichment;
          [(4) an estimate of potential earnings from the 
        licensing of AVLIS and alternative technologies for 
        uranium enrichment to a private government sponsored 
        corporation;
          [(5) an analysis of outstanding and potential patent 
        and related claims with respect to AVLIS and 
        alternative technologies for uranium enrichment, and a 
        plan for resolving such claims; and
          [(6) a contingency plan for providing enriched 
        uranium and related services in the event that 
        deployment of AVLIS and alternative technologies for 
        uranium enrichment is determined not to be economically 
        viable.
  [(b) Determination by Corporation To Proceed With 
Commercialization of AVLIS or Alternative Technologies for 
Uranium Enrichment.--The succeeding sections of this chapter 
shall apply only to the extent the Corporation determines in 
its business judgment, on the basis of the assessment prepared 
under subsection (a), to proceed with the commercialization of 
AVLIS or alternative technologies for uranium enrichment.]
          * * * * * * *

[SEC. 1603. PREDEPLOYMENT ACTIVITIES BY UNITED STATES ENRICHMENT 
                    CORPORATION.

  [The Corporation may begin activities necessary to prepare 
AVLIS or alternative technologies for uranium enrichment for 
commercialization including--
          [(1) completion of preapplication activities with the 
        Nuclear Regulatory Commission;
          [(2) preparation of a transition plan to move AVLIS 
        or alternative technologies for uranium enrichment from 
        the laboratory to the marketplace;
          [(3) confirmation of technical performance;
          [(4) validation of economic projections;
          [(5) completion of feasibility and risk studies;
          [(6) initiation of preliminary plant design and 
        engineering; and
          [(7) site selection, site characterization, and 
        environmental documentation activities on the basis of 
        site evaluations and recommendations prepared for the 
        Department by the Argonne National Laboratory.

[SEC. 1604. UNITED STATES ENRICHMENT CORPORATION SPONSORSHIP OF PRIVATE 
                    FOR-PROFIT CORPORATION TO CONSTRUCT AVLIS AND 
                    ALTERNATIVE TECHNOLOGIES FOR URANIUM ENRICHMENT.

  [(a) Establishment.--
          [(1) In general.--If the Corporation determines to 
        proceed with the commercialization of AVLIS or 
        alternative technologies for uranium enrichment under 
        this chapter, the Corporation may provide for the 
        establishment of a private for-profit corporation, 
        which shall have as its initial purpose the 
        construction of a uranium enrichment facility using 
        AVLIS technology or alternative technologies for 
        uranium enrichment.
          [(2) Process of organization.--For purposes of the 
        establishment of the private corporation under 
        paragraph (1), the Corporation shall appoint not less 
        than 3 persons to be incorporators. The incorporators 
        so appointed shall each sign the articles of 
        incorporation and shall serve as the initial board of 
        directors until the members of the 1st regular board of 
        directors shall have been appointed and elected. Such 
        incorporators shall take whatever actions are necessary 
        or appropriate to establish the private corporation, 
        including the filing of articles of incorporation in 
        such jurisdiction as the incorporators determine to be 
        appropriate. The incorporators shall also develop a 
        plan for the issuance by the private corporation of 
        voting common stock to the public, which plan shall be 
        subject to the approval of the Secretary of the 
        Treasury.
  [(b) Legal Status of Private Corporation.--
          [(1) Not federal agency.--The private corporation 
        established under subsection (a) shall not be an 
        agency, instrumentality, or establishment of the United 
        States Government and shall not be a Government 
        corporation or Government controlled corporation.
          [(2) No recourse against united states.--Obligations 
        of the private corporation established under subsection 
        (a) shall not be obligations of, or guaranteed as to 
        principal or interest by, the Corporation or the United 
        States, and the obligations shall so plainly state.
          [(3) No claims court jurisdiction.--No action under 
        section 1491 of title 28, United States Code, shall be 
        allowable against the United States based on the 
        actions of the private corporation established under 
        subsection (a).
  [(c) Transactions Between United States Enrichment 
Corporation and Private Corporation.--
          [(1) Grants from usec.--The Corporation may make 
        grants to the private corporation established under 
        subsection (a) from amounts available in the AVLIS 
        Commercialization Fund. Such grants shall be used by 
        the private corporation to carry out any remaining 
        predeployment activity assigned to the private 
        corporation by the Corporation. Such grants may not be 
        used for the costs of constructing an AVLIS, or 
        alternative technologies for uranium enrichment, 
        production facility or engaging in directly related 
        preconstruction activities (other than such assigned 
        predeployment activities). The aggregate amount of such 
        grants shall not exceed $364,000,000.
          [(2) Licensing agreement.--The Corporation shall 
        license to the private corporation established under 
        subsection (a) the rights, titles, and interests 
        provided to the Corporation under section 1602. The 
        licensing agreement shall require the private 
        corporation to make periodic payments to the 
        Corporation in an amount that is not less than the 
        aggregate amounts paid by the Corporation during the 
        period involved under subsections (a) and (c) of 
        section 1602.
          [(3) Purchase agreement.--The Corporation may enter 
        into a commitment to purchase all enriched uranium 
        produced at an AVLIS, or alternative technologies for 
        uranium enrichment, facility of the private corporation 
        established under subsection (a) at a price negotiated 
        by the 2 corporations that--
                  [(A) provides the private corporation with a 
                reasonable return on its investment; and
                  [(B) is less costly than enriched uranium 
                available from other sources.
          [(4) Additional assistance.--The Corporation may 
        provide to the private corporation established under 
        subsection (a), on a reimbursable basis, such 
        additional personnel, services, and equipment as the 2 
        corporations may determine to be appropriate.

[SEC. 1605. AVLIS COMMERCIALIZATION FUND WITHIN UNITED STATES 
                    ENRICHMENT CORPORATION.

  [(a) Establishment.--The Corporation may establish within the 
Corporation an AVLIS Commercialization Fund, which shall 
consist of not more than $364,000,000 paid into the Fund by the 
Corporation from amounts provided in appropriation Acts for 
such purposes and from the retained earnings of the 
Corporation.
  [(b) Expenditures From Fund.--Amounts in the AVLIS 
Commercialization Fund shall be available for--
          [(1) expenses of the Corporation in preparing the 
        assessment under section 1601;
          [(2) expenses of predeployment activities under 
        section 1603; and
          [(3) grants to the private corporation under section 
        1604.
  [(c) Limitations.--
          [(1) Exclusive source of funds.--The Corporation may 
        not incur any obligation, or expend any amount, with 
        respect to AVLIS or alternative technologies for 
        uranium enrichment, except from amounts available in 
        the AVLIS Commercialization Fund.
          [(2) Unavailable for construction costs.--No amount 
        may be used from the AVLIS Commercialization Fund for 
        the costs of constructing an AVLIS, or alternative 
        technologies for uranium enrichment, production 
        facility or engaging in directly related 
        preconstruction activities (other than activities 
        specified in subsection (b)).
  [(d) Authorization of Appropriations.--There is authorized to 
be appropriated $364,000,000 from the Uranium Enrichment 
Special Fund for purposes of this section.
  [(e) Cost Report.--On the basis of the assessment under 
section 1601(a)(3), the Corporation shall submit to the 
Congress a report on the capital requirements for 
commercialization of AVLIS.

[SEC. 1606. DEPARTMENT RESEARCH AND DEVELOPMENT ASSISTANCE.

  [If requested by the Corporation, the Secretary shall 
provide, on a reimbursable basis, research and development of 
AVLIS and alternative technologies for uranium enrichment.

[SEC. 1607. SITE SELECTION.

  [This chapter shall not prejudice consideration of the site 
of an existing uranium enrichment facility as a candidate site 
for future expansion or replacement of uranium enrichment 
capacity through AVLIS or alternative technologies for uranium 
enrichment. Selection of a site for the AVLIS, or alternative 
technologies for uranium enrichment, facility shall be made on 
a competitive basis, taking into consideration economic 
performance, environmental compatibility, and use of any 
existing uranium enrichment facilities.]

 CHAPTER 27--LICENSING AND REGULATION OF URANIUM ENRICHMENT FACILITIES

 H4  deg.SEC. 1701. GASEOUS DIFFUSION FACILITIES.

  (a) * * *
          * * * * * * *
  (c) Certification Process.--
          (1) * * *
          (2) [Annual application for certificate of 
        compliance.--The Corporation shall apply at least 
        annually to the Nuclear Regulatory Commission for a 
        certificate of compliance under paragraph (1).] 
        Periodic application for certificate of compliance.--
        The Corporation shall apply to the Nuclear Regulatory 
        Commission for a certificate of compliance under 
        paragraph (1) periodically, as determined by the 
        Nuclear Regulatory Commission, but not less than every 
        5 years. The Nuclear Regulatory Commission, in 
        consultation with the Environmental Protection Agency, 
        shall review any such application and any determination 
        made under subsection (b)(2) shall be based on the 
        results of any such review.
          * * * * * * *

 H4  deg.SEC. 1702. LICENSING OF OTHER TECHNOLOGIES.

  (a) In General.--Corporation facilities using alternative 
technologies for uranium enrichment, [other than] including 
AVLIS, shall be licensed under sections 53 and 63.
          * * * * * * *

             SECTION 1018 OF THE ENERGY POLICY ACT OF 1992

SEC. 1018. DEFINITIONS.

  For purposes of this subtitle:
          (1) The term ``Corporation'' means [the United States 
        Enrichment Corporation established under section 1301 
        of the Atomic Energy Act of 1954, as added by this 
        Act.] the corporation referred to in section 1201(4) of 
        the Atomic Energy Act of 1954.
          * * * * * * *
                              ----------                              


              SECTION 9101 OF TITLE 31, UNITED STATES CODE

Sec. 9101. Definitions

  In this chapter--
          (1) * * *
          * * * * * * *
          (3) ``wholly owned Government corporation'' means--
                  (A) * * *
          * * * * * * *
                  [(N) the Uranium Enrichment Corporation.]
          * * * * * * *
                              ----------                              


             SECTION 1018 OF THE ENERGY POLICY ACT OF 1992

SEC. 1018. DEFINITIONS.

  For purposes of this subtitle:
          (1) The term ``Corporation'' means [the United States 
        Enrichment Corporation established under section 1301 
        of the Atomic Energy Act of 1954, as added by this 
        Act.] the corporation referred to in section 1201(4) of 
        the Atomic Energy Act of 1954.
          * * * * * * *
                              ----------                              


                      TITLE 31, UNITED STATES CODE

                          SUBTITLE I--GENERAL

          * * * * * * *

               Chapter 9--Agency Chief Financial Officers

          * * * * * * *

Sec. 901. Establishment of agency Chief Financial Officers

  (a) There shall be within each agency described in subsection 
(b) an agency Chief Financial Officer. Each agency Chief 
Financial Officer shall--
  (b)(1) The agencies referred to in subsection (a)(1) are the 
following:
          (A) The Department of Agriculture.
          * * * * * * *
          (Q) The United States Trade Administration.
          * * * * * * *

                       SUBTITLE VI--MISCELLANEOUS

          * * * * * * *

                  CHAPTER 91--GOVERNMENT CORPORATIONS

Sec. 9101. Definitions

  In this chapter--
          (1) ``Government corporation'' means a mixed-
        ownership Government corporation and a wholly owned 
        Government corporation.
          * * * * * * *
          (3) ``wholly owned Government corporation'' means--
                  (A) the Commodity Credit Corporation.
          * * * * * * *
                  [(N) the Uranium Enrichment Corporation.]
                  (O) the Patent and Trademark Office.
          * * * * * * *
                              ----------                              


            WASTE ISOLATION PILOT PLANT LAND WITHDRAWAL ACT

          * * * * * * *

SEC. 2. DEFINITIONS.

  For purposes of this Act:
          (1) * * *
          * * * * * * *
          [(18) Test phase.--The term ``test phase'' means the 
        period of time, during which test phase activities are 
        conducted, beginning with the initial receipt of 
        transuranic waste at WIPP and ending when the earliest 
        of the following events occurs:
                  [(A) The requirements described in section 
                7(b) are met.
                  [(B) The Administrator determines under 
                section 8(d)(1)(B) that the WIPP facility will 
                not comply with the disposal regulations.
                  [(C) The time period described in paragraphs 
                (2) and (3) of section 8(d) expires.
                  [(D) The Secretary is required by section 
                9(b)(2) to implement the retrieval plan.
          [(19) Test phase activities.--The term ``test phase 
        activities'' means the testing and experimentation 
        activities to determine the suitability of WIPP as a 
        repository for the permanent isolation of transuranic 
        waste.]
          * * * * * * *

[SEC. 5. TEST PHASE AND RETRIEVAL PLANS.

  [(a) In General.--Not later than 7 months after the date of 
the enactment of this Act, the Secretary shall prepare, and 
submit to the Administrator for review, a test phase plan and a 
retrieval plan in accordance with this section. The Secretary 
shall give notice in the Federal Register of submission of such 
plans and provide an opportunity for public access to such 
plans.
  [(b) Test Phase Plan.--The test phase plan and any 
modification of the plan, as appropriate, shall--
          [(1) set forth the test phase activities to be 
        conducted at WIPP;
          [(2) specify the quantities and types of transuranic 
        waste required for such activities;
          [(3) provide a detailed description of how the test 
        phase activities will provide information directly 
        relevant to a certification of compliance with the 
        final disposal regulations or to compliance with the 
        Solid Waste Disposal Act (42 U.S.C. 6901 et seq.); and
          [(4) include justification for all such activities.
  [(c) Retrieval Plan.--The retrieval plan and any modification 
of the plan, as appropriate, shall set forth a detailed plan 
for the removal of transuranic waste emplaced at WIPP during 
the test phase, if such removal is required under any provision 
of this Act.
  [(d) Approval by Administrator.--
          [(1) In general.--The Administrator shall determine, 
        in a single rulemaking procedure, whether to approve, 
        in whole or in part, or disapprove the test phase plan 
        and whether to approve or disapprove the retrieval 
        plan. The Administrator shall, in accordance with 
        paragraph (3), publish in the Federal Register a final 
        rule setting forth the approval or disapproval in 
        accordance with this subsection not later than 10 
        months after the date of the enactment of this Act.
          [(2) Standards for approval.--
                  [(A) Test phase plan.--The Administrator 
                shall approve the test phase plan, or any 
                modification to the plan, in whole or in part, 
                if the Administrator determines that the 
                experiments will provide data that are directly 
                relevant to a certification of compliance with 
                the final disposal regulations or to compliance 
                with the Solid Waste Disposal Act (42 U.S.C. 
                6901 et seq.).
                  [(B) Retrieval plan.--The Administrator shall 
                approve the retrieval plan, or any modification 
                to the plan, if the Administrator determines 
                that it will provide for satisfactory retrieval 
                of all transuranic waste emplaced during the 
                test phase from WIPP should retrieval of such 
                waste be required.
          [(3) Rulemaking procedure.--The Administrator shall 
        conduct the rulemaking required in paragraph (1) under 
        section 553 of title 5, United States Code, except that 
        sections 556 and 557 of such title shall not apply.
          [(4) Consequences of approval.--If the Administrator 
        approves the test phase plan, in whole or in part, and 
        the retrieval plan under this subsection, the Secretary 
        may immediately proceed with test phase activities to 
        the extent they have been approved in the rule 
        described in paragraph (3) and to the extent the 
        requirements of section 6(b) have been met.
  [(e) Reconsideration of Disapproved Plans.--If any plan, or 
portion of a plan, is not approved under subsection (d), the 
Secretary may submit a revised plan, or portion, to the 
Administrator. Such revised plan, or portion, shall be 
considered in accordance with the procedures applicable under 
such subsection, except that final action shall be completed 
within 3 months of submission to the Administrator.
  [(f) Modifications to Test Phase Plan or Retrieval Plan.--The 
Secretary may submit modifications to the test phase plan or 
retrieval plan. Such modifications shall be considered in 
accordance with the procedures applicable under subsection (d), 
except that final action shall be completed within 3 months of 
submission to the Administrator.]

SEC. 6. TEST PHASE ACTIVITIES.

  [(a) General Authority.--The Secretary is authorized, subject 
to subsections (b) and (c), to conduct test phase activities in 
accordance with the test phase plan.
  [(b) Requirements For Commencement of Test Phase 
Activities.--The Secretary may not transport any transuranic 
waste to WIPP to conduct test phase activities under subsection 
(a) unless the following requirements are met:
          [(1) Final disposal regulations issued.--The final 
        disposal regulations are issued and published in the 
        Federal Register under section 8(b).
          [(2) Terms of no-migration determination complied 
        with.--The Administrator has determined that the 
        Secretary has complied with the terms and conditions of 
        the No-Migration Determination. The determination of 
        the Administrator under this paragraph shall not be 
        subject to rulemaking or judicial review.
          [(3) Test phase and retrieval plans approved.--The 
        Secretary has issued, and the Administrator has 
        approved, the test phase plan and the retrieval plan 
        under section 5.
          [(4) Emergency response training.--
                  [(A) Review.--The Secretary of Labor, acting 
                through the Occupational Safety and Health 
                Administration, has reviewed the emergency 
                response training programs of the Department of 
                Energy that apply to WIPP.
                  [(B) Certification.--The Secretary of Labor, 
                acting through the Occupational Safety and 
                Health Administration, has certified that the 
                Department of Labor has reviewed emergency 
                response training programs of the Department of 
                Energy that apply to WIPP and has concurred 
                that such programs are in compliance with part 
                1910.120 of title 29, Code of Federal 
                Regulations. Such certification shall not be 
                subject to rulemaking or judicial review.
          [(5) Certification of safety.--The Secretary has 
        certified, through the issuance of safety analysis 
        documents, that the safety of test phase activities to 
        be completed at WIPP can be ensured through procedures 
        that would not compromise the type, quantity, or 
        quality of data collected from such test phase 
        activities. Such certification shall not be subject to 
        rulemaking or judicial review.
          [(6) Stability of rooms used for testing.--The 
        Secretary of Energy shall issue a plan to ensure that 
        the mined rooms in the underground repository at WIPP 
        in which transuranic waste may be emplaced will remain 
        sufficiently stable and safe to permit uninterrupted 
        testing for the duration of such activities. The 
        Secretary of Labor, acting through the Mine Safety and 
        Health Administration, shall review such plan and 
        concur that the plan ensures that the mined rooms in 
        the underground repository at WIPP in which transuranic 
        waste may be emplaced will remain sufficiently stable 
        and safe to permit uninterrupted testing for the 
        duration of such activities. Such issuance and 
        concurrence shall not be subject to rulemaking or 
        judicial review.]
  [(c)] (a) [Limitations.--Test phase activities conducted 
under subsection (a) shall be subject to the following 
limitations:] Study.--The following study shall be conducted:
          [(1) Quantity of waste that may be transported.--
        During the test phase, the Secretary may transport to 
        WIPP--
                  [(A) only such quantities of transuranic 
                waste as the Administrator has approved for 
                test phase activities under section 5; and
                  [(B) in no event more than \1/2\ of 1 percent 
                of the total capacity of WIPP as described in 
                section 7(a)(3).
          [(2) Remote-handled waste.--
                  [(A) Transportation and emplacement.--The 
                Secretary may not transport to or emplace 
                remote-handled transuranic waste at WIPP during 
                the test phase.
                  [(B) Study.--]
          [(i)] (1) In general.--Within 3 years after the date 
        of the enactment of this Act, the Secretary shall 
        complete a study on remote-handled transuranic waste in 
        consultation with affected States, the Administrator, 
        and after the solicitation of views of other interested 
        parties.
          [(ii)] (2) Requirements of study.--Such study shall 
        include an analysis of the impact of remote-handled 
        transuranic waste on the performance assessment of WIPP 
        and a comparison of remote-handled transuranic waste 
        with contact-handled transuranic waste on such issues 
        as gas generation, flammability, explosiveness, 
        solubility, and brine and geochemical interactions.
          [(iii)] (3) Publication.--The Secretary shall publish 
        the findings of such study in the Federal Register.
  [(d)] (b) Performance Assessment Report.--
          (1) In general.--The Secretary shall publish, during 
        the test phase, a biennial performance assessment 
        report, consisting of a documented analysis of the 
        long-term performance of WIPP. Each such report shall 
        be provided to the State, the Administrator, the 
        National Academy of Sciences, and the EEG for their 
        review and comment.
          (2) Responses by secretary to comments.--If, within 
        120 days of the publication of a performance assessment 
        report under paragraph (1), the State, the 
        Administrator, the National Academy of Sciences, or the 
        EEG provide written comments on the report, the 
        Secretary shall submit written responses to the 
        comments to the State, the Administrator, the National 
        Academy of Sciences, and the EEG, and to other 
        appropriate entities or persons after consultation with 
        the State, within 120 days of receipt of the comments.

SEC. 7. DISPOSAL OPERATIONS.

  (a) Transuranic Waste Limitations.--
          (1) Rem limits for remote-handled transuranic 
        waste.--
                  (A) * * *
          * * * * * * *
          (3) Nondefense waste.--Within the capacity prescribed 
        by paragraph (4), WIPP may receive transuranic waste 
        from the Secretary which did not result from a defense 
        activity.
          [(3)] (4) Capacity of wipp.--The total capacity of 
        WIPP by volume is 6.2 million cubic feet of transuranic 
        waste.
  [(b) Requirements for Commencement of Disposal Operations.--
The Secretary may commence emplacement of transuranic waste 
underground for disposal at WIPP only upon completion of--
          [(1) the Administrator's certification under section 
        8(d)(1) that the WIPP facility will comply with the 
        disposal regulations;
          [(2) the submission to the Congress by the Secretary 
        of plans for decommissioning WIPP and post-
        decommissioning management of the Withdrawal under 
        section 13;
          [(3) the expiration of the 180-day period beginning 
        on the date on which the Secretary notifies the 
        Congress that the requirements of section 9(a)(1) have 
        been met;
          [(4) the acquisition by the Secretary (whether by 
        purchase, condemnation, or otherwise) of Federal Oil 
        and Gas Leases No. NMNM 02953 and No. NMNM 02953C, 
        unless the Administrator determines, under section 
        4(b)(5), that such acquisition is not required;
          [(5) the submittal to the Congress by the Secretary 
        of comprehensive recommendations for the disposal of 
        all transuranic waste under the control of the 
        Secretary, including a timetable for the disposal of 
        such waste; and
          [(6) the completion by the Secretary, with notice and 
        an opportunity for public comment, of a survey 
        identifying all transuranic waste types at all sites 
        from which wastes are to be shipped to WIPP, and--
                  [(A) the results of such survey shall be made 
                available to the public and be provided to the 
                Administrator; and
                  [(B) such survey shall not be subject to 
                rulemaking or judicial review.]

SEC. 8. ENVIRONMENTAL PROTECTION AGENCY DISPOSAL REGULATIONS.

  (a) * * *
          * * * * * * *
  (d) Disposal Regulations.--
          [(1) Compliance with disposal regulations.--]
          [(A)] (1) In general.--The Secretary shall comply at 
        WIPP with the final disposal regulations. Within 7 
        years of the date of the first receipt of transuranic 
        waste at WIPP, the Secretary shall submit to the 
        Administrator an application for certification of 
        compliance with such regulations.
                  [(B) Certification by administrator.--Within 
                1 year of receipt of the application under 
                subparagraph (A), the Administrator shall 
                certify, by rule pursuant to section 553 of 
                title 5, United States Code, whether the WIPP 
                facility will comply with the final disposal 
                regulations, and sections 556 and 557 of such 
                title shall not apply.
                  [(C) Judicial review.--Judicial review of the 
                certification of the Administrator under 
                subparagraph (B) shall not be restricted by the 
                provisions of section 221 c. of the Atomic 
                Energy Act of 1954 (42 U.S.C. 2271(c)).
                  [(D) Limitation.--Any certification of the 
                Administrator under subparagraph (B) may only 
                be made after the application is submitted to 
                the Administrator under subparagraph (A).]
          (2) Comments of Administrator.--Within 2 months of 
        receipt of the application under subparagraph (A), the 
        Administrator shall provide the Secretary with any 
        comments on the Secretary's application. Within one 
        month of the receipt of such comments, the Secretary 
        shall, to the extent practicable, incorporate the 
        Administrator's comments in the Secretary's 
        application. The comments of the Administrator provided 
        to the Secretary should also be transmitted to the 
        appropriate committees of jurisdiction in the House of 
        Representatives and the Senate.
          [(2) Failure to certify.--Except as provided in 
        paragraph (3), if, upon the expiration of the 10-year 
        period beginning on the date of the first receipt of 
        transuranic waste at WIPP, the Administrator has not 
        certified that the WIPP facility will comply with the 
        final disposal regulations--
                  [(A) the Secretary shall implement the 
                retrieval plan under section 10 and the 
                decommissioning and post-decommissioning plans 
                under section 13;
                  [(B) following implementation of such plans, 
                the land withdrawal made by section 3(a) shall 
                terminate and the land shall be managed by the 
                Secretary of the Interior through the Bureau of 
                Land Management; and
                  [(C)(i) no permit or variance issued with 
                respect to test phase activities or disposal 
                operations pursuant to section 3004 of the 
                Solid Waste Disposal Act (42 U.S.C. 6924), or 
                other applicable hazardous waste laws, with 
                respect to WIPP, shall remain in effect later 
                than 1 year after implementation of the 
                retrieval plan; and
                  [(ii) all transuranic waste shall be removed 
                from the State unless, prior to the expiration 
                of such 1-year period, a new permit or variance 
                is issued pursuant to section 3004 of the Solid 
                Waste Disposal Act (42 U.S.C. 6924), or other 
                applicable hazardous waste laws.
          [(3) Extension of deadline.--The 10-year period in 
        paragraph (2) may be extended once by the Administrator 
        for not more than 2 years, if the Administrator 
        determines that additional time is necessary for the 
        Administrator to complete the rulemaking under 
        paragraph (1)(B) or for the Administrator's 
        certification to become effective under this 
        subsection.]
          * * * * * * *
  (f) [Periodic Recertification] Periodic Review.--
          (1) By secretary.--Not later than 5 years after the 
        initial receipt of transuranic waste for disposal at 
        WIPP, and every 5 years thereafter until the end of the 
        decommissioning phase, the Secretary shall submit to 
        the Administrator and the State documentation of 
        continued compliance with the final disposal 
        regulations.
          [(2) Concurrence by administrator.--The Administrator 
        shall, not later than 6 months after receiving a 
        submission under paragraph (1), determine whether or 
        not the WIPP facility continues to be in compliance 
        with the final disposal regulations. A determination 
        under this paragraph shall not be subject to rulemaking 
        or judicial review.]
          (2) Review by the administrator.--The Administrator 
        shall, not later than 6 months after receiving a 
        submission under paragraph (1), comment on whether or 
        not the WIPP facility continues to be in compliance 
        with the final disposition regulations.
  [(g) Engineered and Natural Barriers, Etc.--The Secretary 
shall use both engineered and natural barriers, and waste form 
modifications, at WIPP to isolate transuranic waste after 
disposal to the extent necessary to comply with the final 
disposal regulations.]
  (g) Engineered and Natural Barriers, Etc.--The Secretary 
should determine whether or not engineered barriers or natural 
barriers, or both, will be required at WIPP consistent with 
regulations published as part 191 of 40 C.F.R.

SEC. 9. COMPLIANCE WITH ENVIRONMENTAL LAWS AND REGULATIONS.

  (a) In General.--
          (1) Applicability.--Beginning on the date of the 
        enactment of this Act, the Secretary shall comply with 
        respect to WIPP, with--
                  (A) * * *
          * * * * * * *
        With respect to transuranic mixed waste designated by 
        the Secretary for disposal at WIPP, such waste is 
        exempt from the land disposal restrictions published at 
        part 268 of 40 C.F.R. because compliance with the 
        environmental radiation protection standards published 
        at part 191 of 40 C.F.R. renders compliance with the 
        land disposal restrictions unnecessary to achieve 
        desired environmental protection and a no migration 
        variance is not required for disposal of transuranic 
        mixed waste at WIPP.
  [(b) Determination of Noncompliance During Test Phase.--
          [(1) Determination by administrator.--If the 
        Administrator determines at any time during the test 
        phase that the WIPP facility does not comply with any 
        law, regulation, or permit requirement described in 
        subsection (a)(1), the Administrator shall request a 
        remedial plan from the Secretary describing actions the 
        Secretary will take to comply with such law, 
        regulation, or permit requirement.
          [(2) Consequences of noncompliance.--If--
                  [(A) a remedial plan is not received from the 
                Secretary within 6 months of a determination of 
                noncompliance under paragraph (1); or
                  [(B) the Administrator determines, by rule 
                pursuant to section 553 of title 5, United 
                States Code, that a remedial plan requested 
                under paragraph (1) is inadequate to bring the 
                WIPP facility into compliance;
        then the Secretary shall implement the retrieval plan 
        under section 10 and the decommissioning and post-
        decommissioning plans under section 13, and, following 
        implementation of such plans, the land withdrawal made 
        by section 3(a) shall terminate and the land shall be 
        managed by the Secretary of the Interior through the 
        Bureau of Land Management.
  [(c) Determination of Noncompliance During Disposal Phase and 
Decommissioning Phase.--
          [(1) Determination by the administrator.--If the 
        Administrator determines at any time during the 
        disposal phase or decommissioning phase that the WIPP 
        facility does not comply with any law, regulation, or 
        permit requirement described in subsection (a)(1), the 
        Administrator shall request a remedial plan from the 
        Secretary describing actions the Secretary will take to 
        comply with such law, regulation, or permit 
        requirement.
          [(2) Consequences of noncompliance.--If--
                  [(A) a remedial plan is not received from the 
                Secretary within 6 months of a determination of 
                noncompliance under paragraph (1); or
                  [(B) the Administrator determines, by rule 
                pursuant to section 553 of title 5, United 
                States Code, that a remedial plan requested 
                under paragraph (1) is inadequate to bring the 
                WIPP facility into compliance;
        then the Secretary shall retrieve, to the extent 
        practicable, any transuranic waste and any material 
        contaminated by such waste from underground at WIPP, 
        and implement the decommissioning and post-
        decommissioning plans under section 13. Following 
        completion of such retrieval and implementation of such 
        plans, the land withdrawal made by section 3(a) shall 
        terminate and the land shall be managed by the 
        Secretary of the Interior through the Bureau of Land 
        Management.
  [(d) Savings Provision.--The authorities provided to the 
Administrator and to the State pursuant to this section are in 
addition to the enforcement authorities available to the State 
pursuant to State law and to the Administrator, the State, and 
any other person, pursuant to the Solid Waste Disposal Act (42 
U.S.C. 6901 et seq.) and the Clean Air Act (40 U.S.C. 7401 et 
seq.).]

[SEC. 10. RETRIEVABILITY.

  [(a) Requirement of Retrievability.--
          [(1) In general.--Transuranic waste emplaced in WIPP 
        for purposes of the test phase shall be retrievable 
        during the test phase, and for such period of time 
        subsequent to the test phase as may be needed to 
        provide for its retrieval in the event that--
                  [(A) the Secretary or the Administrator 
                determines that WIPP does not comply with the 
                final disposal regulations;
                  [(B) the transuranic waste needs to be 
                retrieved for engineering modification or for 
                repackaging for permanent disposal; or
                  [(C) such retrieval is necessary to protect 
                the public health and safety and the 
                environment.
          [(2) Annual determination of retrievability.--
        Beginning 1 year after the initial emplacement of 
        transuranic waste underground at WIPP, and continuing 
        annually throughout the test phase, the Secretary, 
        after consultation with the Administrator, shall 
        publish in the Federal Register the Secretary's 
        determination of whether all such waste emplaced 
        underground at WIPP remains, and will remain, fully 
        retrievable during the test phase.
          [(3) Annual demonstration of retrievability.--The 
        Secretary shall demonstrate, on an annual basis, in 
        conjunction with the determination required in 
        paragraph (2), that a sample of transuranic waste is 
        retrievable. In making such demonstration, the 
        Secretary shall not take any action to affect the test 
        phase.
          [(4) Failure to maintain retrievability.--Upon a 
        determination by the Secretary under paragraph (2) that 
        transuranic waste cannot remain retrievable, and that 
        corrective action is not possible, the Administrator 
        and the State may, pursuant to the authorities provided 
        in the Solid Waste Disposal Act (42 U.S.C. 6901 et 
        seq.) or any other applicable hazardous waste law, take 
        action to ensure the retrieval or removal of all 
        transuranic waste in WIPP.
  [(b) Implementation of Retrieval Plan.--The Secretary shall 
implement the retrieval plan or take corrective action to 
ensure the retrievability of transuranic waste in the event 
that a determination is made under subsection (a)(2) that the 
waste is not or will not otherwise remain retrievable.
  [(c) Conflict Resolution.--The State may invoke the conflict 
resolution provisions of the Agreement if it determines that 
there is an insufficient basis for the Secretary's annual 
determination of retrievability or that the demonstration of 
retrievability does not ensure that transuranic waste will be 
retrievable.]

SEC. 10. TRANSURANIC WASTE.

  It is the intent of Congress that a decision will be made by 
the Secretary with respect to the disposal of transuranic waste 
no later than March 31, 1997.
          * * * * * * *

SEC. 13. DECOMMISSIONING OF WIPP.

  [(a) Plan for WIPP Decommissioning.--Within 5 years after the 
date of the enactment of this Act, the Secretary shall submit 
to the Congress, the State, the Secretary of the Interior, and 
the Administrator, a plan for the decommissioning of WIPP. In 
addition to activities required under the Agreement, the plan 
shall conform to the disposal regulations that apply to WIPP at 
the time the plan is prepared. The Secretary shall consult with 
the Secretary of the Interior and the State in the preparation 
of such plan.
  [(b) Management Plan for the Withdrawal After 
Decommissioning.--Within 5 years after the date of the 
enactment of this Act, the] The Secretary shall develop a plan 
for the management and use of the Withdrawal following the 
decommissioning of WIPP or the termination of the land 
withdrawal. The Secretary shall consult with the Secretary of 
the Interior and the State in the preparation of such plan and 
shall submit such plan to the Congress.
          * * * * * * *

SEC. 15. ECONOMIC ASSISTANCE AND MISCELLANEOUS PAYMENTS.

  (a) 15-Year Authorization.--There are authorized to be 
appropriated [to the Secretary for payments to the State 
$20,000,000 for each of the 15 fiscal years beginning with the 
fiscal year in which the transport of transuranic waste to WIPP 
is initiated] to the State $20,000,000 for each of the 15 
fiscal years beginning with the date of the enactment of the 
Waste Isolation Pilot Plant Land Withdrawal Amendment Act. An 
appropriation to the State shall be in addition to any 
appropriation for WIPP.
          * * * * * * *
                              ----------                              


              CHAPTER 641 OF TITLE 10, UNITED STATES CODE

                 CHAPTER 641--NAVAL PETROLEUM RESERVES

Sec.
7420.  Definitions.
7421.  Jurisdiction and control.
7421a.   Sale of naval petroleum reserves.
     * * * * * * *

Sec. 7421a. Sale of naval petroleum reserves

  (a) Sale Required.--(1) Notwithstanding any other provision 
of this chapter, the Secretary shall sell all right, title, and 
interest of the United States in and to the lands owned or 
controlled by the United States inside the naval petroleum and 
oil shale reserves established by this chapter. In the case of 
Naval Petroleum Reserve Numbered 1, the lands to be sold shall 
include sections 16 and 36 of township 30 south, range 23 east, 
Mount Diablo Principal Meridian, California.
  (2) Not later than December 31, 1996, the Secretary shall 
enter into one or more contracts for the sale of all of the 
interest of the United States in the naval petroleum reserves.
  (b) Timing and Administration of Sale.--(1) Not later than 
January 1, 1996, the Secretary shall retain the services of 
five independent experts in the valuation of oil and gas fields 
to conduct separate assessments, in a manner consistent with 
commercial practices, of the fair market value of the interest 
of the United States in each naval petroleum reserve. In making 
their assessments for each naval petroleum reserve, the 
independent experts shall consider (among other factors) all 
equipment and facilities to be included in the sale, the net 
present value of the reserve, and the net present value of the 
anticipated revenue stream that the Secretary determines the 
Treasury would receive from the reserve if it were not sold, 
adjusted for any anticipated increases in tax revenues that 
would result if it were sold. The independent experts shall 
complete their assessments not later than July 1, 1996. In 
setting the minimum acceptable price for each naval petroleum 
reserve, the Secretary shall consider the average of the five 
assessments regarding the reserve or, if more advantageous to 
the Government, the average of three assessments after 
excluding the high and low assessments.
  (2) Not later than March 1, 1996, the Secretary shall retain 
the services of an investment banker to independently 
administer, in a manner consistent with commercial practices 
and in a manner that maximizes sale proceeds to the Government, 
the sale of the naval petroleum reserves under this section. 
The Secretary may enter into the contracts required under this 
paragraph and paragraph (1) on a noncompetitive basis.
  (3) Not later than August 1, 1996, the sales administrator 
selected under paragraph (2) shall complete a draft contract 
for the sale of each naval petroleum reserve, which shall 
accompany the invitation for bids and describe the terms and 
provisions of the sale of the interest of the United States in 
the reserve. Each draft contract shall identify all equipment 
and facilities to be included in the sales. Each draft 
contract, including the terms and provisions of the sale of the 
interest of the United States in the naval petroleum reserves, 
shall be subject to review and approval by the Secretary, the 
Secretary of the Treasury, and the Director of the Office of 
Management and Budget.
  (4) Not later than September 1, 1996, the Secretary shall 
publish an invitation for bids for the purchase of the naval 
petroleum reserves.
  (5) Not later than November 1, 1996, the Secretary shall 
accept the highest responsible offer for purchase of the 
interest of the United States in the naval petroleum reserves, 
or a particular reserve, that meets or exceeds the minimum 
acceptable price determined under paragraph (1). The Secretary 
may accept an offer for only a portion of a reserve so long as 
the entire reserve is still sold under this section at a price 
that meets or exceeds the minimum acceptable price.
  (c) Future Liabilities.--The United States shall hold 
harmless and fully indemnify the purchaser of the interest of 
the United States in a naval petroleum reserve from and against 
any claim or liability as a result of ownership in the reserve 
by the United States.
  (d) Special Rules Preparatory to Sale of Naval Petroleum 
Reserve Numbered 1.--(1) Not later than June 1, 1996, the 
Secretary shall finalize equity interests of the known oil and 
gas zones in Naval Petroleum Reserve Numbered 1 in the manner 
provided by this subsection.
  (2) The Secretary shall retain the services of an independent 
petroleum engineer, mutually acceptable to the equity owners, 
who shall prepare a recommendation on final equity figures. The 
Secretary may accept the recommendation of the independent 
petroleum engineer for final equity in each known oil and gas 
zone and establish final equity interest in the Naval Petroleum 
Reserve Numbered 1 in accordance with such recommendation, or 
the Secretary may use such other method to establish final 
equity interest in that reserve as the Secretary considers 
appropriate. The Secretary may enter into the contract required 
under this paragraph on a noncompetitive basis.
  (3) If, on the effective date of this section, there is an 
ongoing equity redetermination dispute between the equity 
owners under section 9(b) of the unit plan contract, such 
dispute shall be resolved in the manner provided in the unit 
plan contract not later than June 1, 1996. Such resolution 
shall be considered final for all purposes under this section.
  (4) In this section, the term ``unit plan contract'' means 
the unit plan contract between equity owners of the lands 
within the boundaries of Naval Petroleum Reserve Numbered 1 
(Elk Hills) entered into on June 19, 1944.
  (e) Production Allocation Regarding Naval Petroleum Reserve 
Numbered 1.--(1) As part of the contract for purchase of Naval 
Petroleum Reserve Numbered 1, the purchaser of the interest of 
the United States in that reserve shall agree to make up to 25 
percent of the purchaser's share of annual petroleum production 
from the purchased lands available for sale to small refiners, 
which do not have their own adequate sources of supply of 
petroleum, for processing or use only in their own refineries. 
None of the reserved production sold to small refiners may be 
resold in kind. The purchaser of that reserve may reduce the 
quantity of petroleum reserved under this subsection in the 
event of an insufficient number of qualified bids. The seller 
of this petroleum production has the right to refuse bids that 
are less than the prevailing market price of comparable oil.
  (2) The purchaser of Naval Petroleum Reserve Numbered 1 shall 
also agree to ensure that the terms of every sale of the 
purchaser's share of annual petroleum production from the 
purchased lands shall be so structured as to give full and 
equal opportunity for the acquisition of petroleum by all 
interested persons, including major and independent oil 
producers and refiners alike.
  (f) Maintaining Production Pending Sale of Naval Petroleum 
Reserve Numbered 1.--Until the sale of Naval Petroleum Reserve 
Numbered 1 is completed under this section, the Secretary shall 
continue to produce that reserve at the maximum daily oil or 
gas rate from a reservoir, which will permit maximum economic 
development of the reservoir consistent with sound oil field 
engineering practices in accordance with section 3 of the unit 
plan contract. The definition of maximum efficient rate in 
section 7420(6) of this title shall not apply to Naval 
Petroleum Reserve Numbered 1.
  (g) Effect on Existing Contracts.--(1) In the case of any 
contract, in effect on the effective date of this section, for 
the purchase of production from any part of the United States' 
share of the naval petroleum reserves, the sale of the interest 
of the United States in the reserves shall be subject to the 
contract for a period of three months after the closing date of 
the sale or until termination of the contract, whichever occurs 
first. The term of any contract entered into after the 
effective date of this section for the purchase of such 
production shall not exceed the anticipated closing date for 
the sale of the reserve.
  (2) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in 
the contract between the United States and Bechtel Petroleum 
Operation, Inc., Contract Number DE-ACO1-85FE60520 so that the 
contract terminates not later than the date of closing of the 
sale of that reserve.
  (3) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in 
the unit plan contract so that the unit plan contract 
terminates not later than the date of closing of the sale of 
that reserve.
  (h) Set Aside of Sale Proceeds on Account of California 
Claims Regarding Naval Petroleum Reserve Numbered 1.--(1) An 
amount equal to seven percent of the proceeds from the sale of 
Naval Petroleum Reserve Numbered 1 shall be retained in a 
special account in the Treasury for the purpose of paying any 
amount that may be owed by the United States as a result of 
legal action in connection with claims against the United 
States by the State of California and the Teachers' Retirement 
Fund of the State of California with respect to lands within 
Naval Petroleum Reserve Numbered 1, including sections 16 and 
36 of township 30 south, range 23 east, Mount Diablo Principal 
Meridian, California, or production or proceeds of sale from 
that reserve.
  (2) In determining the amount of the proceeds arising from 
the sale of Naval Petroleum Reserve Numbered 1, the Secretary 
shall deduct the costs incurred to conduct the sale of that 
reserve.
  (3) A payment may be made from the special account only to 
the extent that the aggregate amount of such payment is 
provided for in advance in an appropriations Act.
  (i) Effect on Antitrust Laws.--Nothing in this section shall 
be construed to alter the application of the antitrust laws of 
the United States to the purchaser of a naval petroleum reserve 
or to the lands in the naval petroleum reserves subject to sale 
under this section upon the completion of the sale.
  (j) Preservation of Private Right, Title, and Interest.--
Nothing in this section shall be construed to adversely affect 
the ownership interest of any other entity having any right, 
title, and interest in and to lands within the boundaries of 
the naval petroleum reserves.
  (k) Congressional Notification.--Section 7431 of this title 
shall not apply to the sale of the naval petroleum reserves 
under this section. However, the Secretary may not enter into a 
contract for the sale of a naval petroleum reserve until the 
end of the 15-day period beginning on the date on which the 
Secretary notifies the Committee on Armed Services of the 
Senate and the Committee on National Security and the Committee 
on Commerce of the House of Representatives that the Secretary 
has accepted an offer under subsection (b)(5) for the sale of 
that reserve.
          * * * * * * *
     TITLE IV--COMMITTEE ON ECONOMIC AND EDUCATIONAL OPPORTUNITIES

                              Committee on Economic
                             and Educational Opportunities,
                                Washington, DC, September 29, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget, House of Representatives, 
        Washington, DC.
    Dear Chairman Kasich: Pursuant to the reconciliation 
directives contained in the Conference Report on House 
Concurrent Resolution 67, the budget resolution for fiscal year 
1996, I am pleased to transmit reconciliation recommendations 
for programs within the jurisdiction of the Committee on 
Economic and Educational Opportunities. The recommendations 
contained in this formal transmission were approved by the full 
committee on September 28, 1995, by a vote of 23 to 14. A copy 
of the legislation, and report, including the committee views 
together with minority views, summary, section by section 
analysis, and other items necessary to comply with House Rules 
are enclosed. Pursuant to your request, this letter is being 
transmitted in concert with another letter of today's date 
containing transmittal of legislation for programs within the 
jurisdiction of the committee that have been considered in H.R. 
4, the Personal Responsibility Act.
    The budget resolution instructs the Committee on Economic 
and Educational Opportunities to report changes in laws within 
its jurisdiction that provide direct spending levels of $16.026 
billion in fiscal year 1996, $77.346 billion for fiscal year 
1996 through fiscal year 2000, and $110.936 billion for fiscal 
year 1996 through fiscal year 2002.\1\
    \1\ Assumes enactment of H.R. 4, the House-passed welfare reform 
legislation.
---------------------------------------------------------------------------
    I also understand the Budget Committee will include the 
necessary language to change credit reform as it appears in 
House Concurrent Resolution 67. As you are aware, this is a 
vital component of our reconciliation package. We look forward 
to working with you to retain this key provision.
    I hope these proposals will be of assistance to your 
committee in meeting the budget reconciliation targets. If you 
have questions or comments, please do not hesitate to call me.
            Sincerely,
                                             Bill Goodling,
                                                          Chairman.

                           table of contents

                                                                   Page
Transmittal letter...............................................   335
Purpose..........................................................   336
Committee action.................................................   336
Legislative action...............................................   337
Summary..........................................................   338
Committee views..................................................   338
Section-by-section analysis......................................   361
Changes in existing law..........................................   365
Congressional Budget Office estimate.............................   403
Committee oversight findings.....................................   418
Inflationary impact statement....................................   418
Committee on Government Reform and Oversight findings............   418
Committee estimate...............................................   418
Application of law to legislative branch.........................   418
Unfunded mandate statement.......................................   418

    The provisions of the recommendations are explained in this 
report.

                                Purpose

    The conference report on House Concurrent Resolution 67, 
concurrent resolution setting forth the congressional budget 
for the U.S. Government for the fiscal years 1996, 1997, 1998, 
1999, 2000, 2001, and 2002, as adopted by the House of 
Representatives on June 29, 1995, included instructions to the 
Economic and Educational Opportunities Committee to recommend 
changes in laws within its jurisdiction sufficient to reduce 
direct spending by $10.08 billion over the fiscal years 1996 
through 2002 by making reforms in the student loan programs. 
The purpose of the committee's recommendations set forth in 
subtitle A of the accompanying legislation is to respond to 
those instructions.
    The fiscal year 1996 conference report accompanying House 
Concurrent Resolution 67 also included instructions to the 
Committee on Economic and Educational Opportunities to reduce 
authorization outlays by $5.810 in fiscal year 1996 through 
fiscal year 2000 and a total 7 year reduction of $8.770 
billion. To meet this target, the committee repeals the Davis-
Bacon Act (the act of March 3, 1931, 40 U.S.C. 276a, et seq.) 
and assumes the elimination of the Service Contract Act of 1965 
(41 U.S.C. 351 et seq.) as part of the overall reconciliation 
package.
    The provision in subtitle C is intended to further the 
needs of pension plan participants to receive their benefits on 
a timely basis after they request a distribution from pension 
plans which are subject to the Employee Retirement Income 
Security Act of 1974 [ERISA].

                            Committee Action

    On May 3, 1995, the Committee on Economic and Educational 
Opportunities, Subcommittee on Postsecondary Education, 
Training and Life-Long Learning, and the Committee on 
Government Reform, Subcommittee on National Economic Growth, 
Natural Resources and Regulatory Affairs held a joint hearing 
on privatizing Government sponsored enterprises [GSE's]. 
Witnesses were: Ms. Darcy Bradbury, Deputy Assistant Secretary 
for Federal Finance, Department of the Treasury, Washington, 
DC; Mr. Leo Kornfeld, Senior Advisor to the Secretary, 
Department of Education, Washington, DC; Mr. Lawrence Hough, 
president and chief executive officer, the Student Loan 
Marketing Association, Washington, DC; Mr. Oliver Sockwell, 
president and chief executive officer, the College Construction 
Loan Insurance Association, Washington, DC; Mr. Fred Khedouri, 
senior managing director at Bear, Stearns, and Co., Inc., New 
York, NY, and; Mr. Robert Torray, president of Robert Torray 
and Co., Bethesda, MD.
    On May 23, 1995 the Committee on Economic and Educational 
Opportunities, Subcommittee on Oversight and Investigations 
held a hearing on the Federal Student Loan Program. Witnesses 
were: the Honorable Thomas Petri; the Honorable Ernest Istook; 
the Honorable Paul Simon; the Honorable Bart Gordon; Ms. 
Phyllis Hooyman, director of financial aid, Hope College; Dr. 
Diane Ryan, director of financial aid, California State 
University, Northridge; Mr. Otto Reyer, associate vice 
chancellor for student services and director of financial aid, 
University of California, Irvine; Ms. Lynn Fawthrop, chair, 
Advisory Committee on Student Financial Assistance; and Mr. 
Richard Pierce, president and chief operating officer, Maine 
Education Services.
    On February 15, 1995, the Committee on Economic and 
Educational Opportunities, Subcommittee on Workforce 
Protections held a hearing on H.R. 500, legislation to repeal 
the Davis-Bacon Act. Testimony was received from: Cindy Athey, 
president of Precision Wall Tech, Inc.; Karen Kerrigan, 
president of the Small Business Survival Committee; Clarke 
Becker, mayor of Woodland Park, CO, representing the National 
League of Cities; and Sigurd Lucassen, general president of the 
United Brotherhood of Carpenters and Joiners. On March 2, 1995, 
the subcommittee favorably reported by voice vote H.R. 500, as 
amended, to the full committee.
    On February 15, 1995 the Committee on Economic and 
Educational Opportunities, Subcommittee on Workforce 
Protections held a hearing on H.R. 246, legislation to repeal 
the Service Contract Act. The following individuals testified: 
Beverly Hall Burns, Esq., Detroit, MI; Frank E. Bazler, 
corporate attorney and assistant secretary (accompanied by 
Michael A. Ferreira, vice-president of product service, and 
Morgan W. VonLohr, manager, service projects) Hobart Corp. 
doing business as PMI Food Equipment Group, Troy, OH; and John 
J. Sweeney, president, Service Employees International Union, 
Washington, DC. On March 2, 1995, the Subcommittee on Workforce 
Protections favorably reported by voice vote H.R. 246, as 
amended, to the full committee.

                           Legislative Action

    On September 28, 1995, the Committee on Economic and 
Educational Opportunities assembled to consider a committee 
print, recommendation instructions to comply with House 
Concurrent Resolution 67. Chairman Goodling offered an 
amendment in the nature of a substitute to the committee print. 
The committee print with an amendment in the nature of a 
substitute was reported to the Committee on the Budget, 
September 28, 1995, by a recorded vote of 23 to 14.

                                Summary

    The following is a summary of the legislation as approved 
by this committee:
    The committee's reconciliation recommendations: Terminate 
the Direct Student Loan Program; reduce costs in the Federal 
Family Education Loan Program through numerous reforms; revise 
the interest subsidy provisions in order to eliminate the 
subsidy on new loans during the 6-month grace period; privatize 
the College Construction Loan Insurance Association; repeal the 
Act of March 3, 1931, known as the Davis-Bacon Act; repeal 
section 2 of the Copeland Act, which sets forth certain 
reporting requirements intended to aid in Davis-Bacon 
enforcement and compliance; and allow the 30-day period 
prescribed by the Secretary of the Treasury in regulations to 
be waived by the participant and, if applicable, the 
participant's spouse.

                            Committee Views

                           a balanced budget

    The committee recognizes that the single most important 
thing we can do for our children and for young Americans is to 
balance the Federal budget. Should Congress fail to act, by the 
year 2002 the national debt will exceed $6.5 trillion. 
According to the President's fiscal year 1995 budget, unless 
Federal spending is brought under control, the lifetime tax 
rate for children born in 1993 will exceed 82 percent. This 
means that over their taxable lifetime, these children will pay 
on average 82 percent of their incomes to the Government. And, 
by 1997, taxpaying Americans will be spending more for interest 
on our national debt than they do for the defense of our great 
country.
    However, if we take advantage of this historic opportunity, 
and bring the Government's appetite for taxing and spending 
under control and balance the Federal budget, the result will 
be a reduction of interest rates by at least 2 percent, an 
increase in jobs, and a more competitive American economy. For 
example, a 2-percent reduction in interest rates will save the 
average American $37,440 on a $75,000 mortgage over the life of 
a 30-year loan. On a 5-year car loan of $15,000, the average 
American will save $900 if we balance the budget and reduce 
interest rates by 2 percent. And of course, with a balanced 
budget, students will see the interest rates on their student 
loans drop by 2 percent as well. The results? A more prosperous 
America, a brighter future for our children, and the creation 
of 6.1 million jobs over the 10-year period following a 
balanced budget.
    Under the conference agreement on the budget resolution 
passed by both the House and the Senate, this committee has 
been instructed to achieve $10.08 billion in savings over the 
next 7 years from the Federal student loan programs. This is 
our contribution to a balanced budget. We are committed to 
meeting this target, and pleased to be a part of this sweeping 
effort to strengthen our Nation's economy. Many of us have 
college-aged children, as well as older children with children 
of their own. Balancing the budget is absolutely essential to 
their future, and to the future of all Americans.
    In achieving the savings asked of this committee, we have 
attempted to be both fair and equitable. Our over-arching goal 
has been to ensure that students continue to have access to 
affordable student loan capital; we have achieved that goal. 
The committee regrets that many of those who are opposed to 
balancing the budget have made irresponsible misrepresentations 
as to how we plan to achieve the necessary savings to reach our 
target. Claims have been made that the committee intends to 
eliminate Federal student loans, or somehow increase their 
costs to the point where college will no longer be affordable. 
Nothing could be further from the truth. In fact, this 
legislation:
          Does not eliminate student loans;
          Does not eliminate the in-school interest subsidy for 
        either graduate or undergraduate students;
          Does not increase the loan origination fees paid by 
        students or increase their interest rates; and
          Does not take away the interest rate reduction 
        scheduled to take place in July 1998.
    To get to the target of $10.08 billion in savings over 7 
years, the committee requires lenders, secondary markets, and 
guaranty agencies to contribute the most toward a balanced 
budget, roughly $5 billion over 7 years.
    These savings are achieved by:
          Requiring lenders, rather than taxpayers, to pay the 
        administrative expenses of the guaranty agency which 
        guarantees their loans;
          Extending the amount of time during which guarantors 
        must attempt to establish or reestablish collection 
        prior to receiving reimbursement for defaulted loans. 
        During this time guaranty agencies will be required to 
        use reserve funds to cover loan insurance;
          Requiring those purchasing loans to pay a transfer 
        fee to the Federal Government;
          Eliminating the fees paid to guaranty agencies for 
        performing collection activities beyond the 90th day of 
        delinquency; requiring loan holders to rebate interest 
        from PLUS loans to offset the costs of the program; and
          Increasing the financial risk which lenders and 
        guarantors undertake on student loans. For lenders, 
        this means that they will receive 95 cents on the 
        dollar for each loan in default. For guarantors, the 
        amount the Federal Government pays a guaranty agency 
        for defaulted loans will decrease from the current 98/
        88/78 cents on the dollar to 96/86/76 cents on the 
        dollar based on an agency's default rate. This means if 
        the default rate is less than 5 percent, agencies will 
        receive 96 cents on the dollar; if the rate is greater 
        than 5 percent but less than 9 percent, reimbursement 
        will be 86 cents on the dollar; and if the rate is 
        greater than 9 percent, reimbursement will be 76 cents 
        on the dollar.
    The committee notes that by increasing the amount of time 
during which lenders and guarantors must attempt to establish 
repayment on delinquent loans, the borrower is given additional 
time to come into repayment before suffering the consequences 
of default. This provision is therefore both a benefit to 
borrowers and to taxpayers.
    Additionally, savings are achieved by asking borrowers to 
be responsible for interest on their loans during the 6-month 
grace period between the time they leave school and enter 
repayment. This will not result in any borrower being required 
to enter repayment prior to the end of the 6-month grace 
period; borrowers will continue to receive this benefit. 
Instead, graduated students will be given the choice of 
repaying the interest on their loans during that period, or 
allowing it to accrue and repaying it when they begin repaying 
their loans. For the average undergraduate borrower, this will 
hardly increase monthly loan payments.
    The remainder of the savings are achieved through the 
elimination of the costly Direct Student Loan Program. This 
program was enacted during the budget reconciliation of 1993. 
At that time, the Congressional Budget Office [CBO], using 
budget scoring rules which failed to account for the costs of 
administering direct student loans over most of the life of the 
loans, estimated that a move to direct lending would save $4.3 
billion through 1998. Republican members of the Committee 
questioned the validity of the estimate, to which Robert 
Reischauer, then Director of the Congressional Budget Office, 
responded:


         The administrative costs associated with the 
        Administration's direct loan program are not evenly 
        divided over the life of the loan. Rather, the 
        administrative costs are disproportionately associated 
        with the collection of interest and principal payments 
        and this collection does not begin until the student 
        has left school, often several years after receiving 
        the loan. For this reason, the administrative costs 
        included in [CBO's] estimate for the first years of a 
        direct loan program are much lower than the full 
        administrative costs of a direct loan program.

    The result was that under the guise of flawed scoring, the 
Direct Student Loan Program was enacted to provide increased 
benefits to students.
    Now, in 1995, we have an accurate accounting of the costs 
of both the Direct and Guaranteed Student Loan Programs. 
According to the CBO, complete elimination of the Direct 
Student Loan Program, returning all student lending to the 
private sector, will save $1.5 billion over the next 7 years 
without any cost to students.
    We are also extremely concerned over the prospect of the 
Department of Education becoming one of the world's largest 
banks. For some reason, the administration appears to be 
replacing the Guaranteed Student Loan Program with a program 
that nationalizes the student loan industry, in addition to 
adding over $340 billion to the national debt by the year 2014. 
Given the Department's apparent willingness to use taxpayer 
funds to improperly advertise the direct loan program, we can 
only assume this to be part of the President's re-election 
campaign.
    Let us be clear: we believe that the private sector is far 
more efficient and effective at delivering and collecting 
student loans than the Department of Education will ever be. To 
date, under the Federal Family Education Loan Program [FFELP], 
private lenders have supplied students and parents with 74 
million student loans totaling in excess of $180 billion. In 
contrast, the Direct Student Loan Program has been around for 
just over a year, and has really only been tried on 104 
campuses. It is unclear whether the Department will be able to 
handle an expansion of this program, or even be able to 
effectively collect the loans which it has already made. 
Currently, the Department cannot even provide an accurate list 
of the schools participating in the direct loan program and the 
dollar volume of the loans that they can be expected to make. 
It would be risky at best to rely on the administration's 
Direct Student Loan Program.
    In recommending the elimination of the administration's 
Direct Student Loan Program, the committee is choosing benefits 
for students over entitlements for bureaucrats. Unfortunately, 
the continuation of the Direct Student Loan Program would 
require us to increase costs to students. At this time, it 
makes no sense to continue the direct lending experiment.

            College Construction Loan Insurance Association

    The College Construction Loan Insurance Association, Connie 
Lee or the Corporation, is an example of a very successful 
public- private partnership which has served its purpose. 
Connie Lee was authorized by Congress under title VII of the 
Higher Education Amendments of 1986. At that time, the 
deterioration of physical infrastructure was a pressing problem 
for institutions of higher education, and low cost financing of 
improvements to facilities was an option only for those 
institutions considered to be of the highest credit caliber. 
Connie Lee was chartered to underwrite the financing of 
facilities construction and improvement for the more mainstream 
institutions. For the Government, the creation of Connie Lee 
provided the best solution to the problem; leveraging a 
significant amount of private capital while exposing the 
Government to little liability.
    Since that time, Connie Lee has insured or reinsured nearly 
$10 billion in principal and interest for academic facilities. 
However, Connie Lee's success in fulfilling its mission has 
created a situation where severing its relationship with the 
Government is desirable for both parties.

                      Advantages of Privatization

    Connie Lee has never enjoyed the advantages accorded to 
most Government Sponsored Enterprises [GSE's]. Connie Lee has 
no Federal line of credit. Connie Lee does not use federally 
backed debt to fund its operations, and it must pay State and 
local income taxes and Federal Exchange Commission filing fees. 
In fact, the Higher Education Act (section 751 (b)) 
specifically prohibits Connie Lee from being a Government 
Corporation or Government-controlled Corporation. Clearly, 
Connie Lee was meant to be a fully private company.
    However, the committee recognizes that the Department of 
Education's minority ownership of stock, 14 percent, coupled 
with a Government charter restricting Connie Lee's business 
activities does create the perception of implicit Government 
protection for the Corporation. Therefore, the complete 
privatization of Connie Lee would benefit both the Corporation 
and the Government.
    For Connie Lee, privatization means the ability to 
determine its own destiny. Currently, its business activities 
are narrowly limited. Privatization would allow Connie Lee to 
use its expertise in facilities underwriting to help secure 
funding for elementary and secondary schools, higher education 
facilities which do not currently fall within its charter 
guidelines, and local municipal projects.
    In return, the taxpayer is relieved of the perception of 
any implicit risk of loss should Connie Lee have financial 
difficulties. This shift in philosophy represents a clear 
departure from business as usual in Washington. It represents a 
willingness on the part of the Government to recognize when a 
Federal presence is no longer needed, and it reduces the 
Government's presence in the market-place.
    Section 4010 privatizes Connie Lee upon enactment and 
allows up to 6 months for the sale of stock owned by the 
Department of Education. Prior to the sale of the federally 
held stock, the Federal directors on Connie Lee's board would 
retain their positions. In this way, the taxpayer is assured 
the maximum return for the initial investment in Connie Lee, 
and the Corporation is not unnecessarily prevented from putting 
its resources to more productive uses.
    Government entities and Government sponsored enterprises 
such as the Student Loan Marketing Association are prohibited 
from acquiring new stock in the Corporation. Additionally, the 
Student Loan Marketing Association, which currently holds 35 
percent of the Corporation's outstanding stock, is prohibited 
from controlling the operations of the Corporation. However, 
the Student Loan Marketing Association is allowed to retain the 
Connie Lee stock it holds as of the enactment date, and is 
allowed to retain its representation on Connie Lee's board.
    The committee believes that the Secretary of the Treasury 
will be able to sell the federally held stock in the 
Corporation at a price which ensures the maximum return to the 
taxpayer. However, in the event that the Secretary of the 
Treasury is unable to sell the federally held shares of the 
Corporation, Connie Lee is required to repurchase the stock at 
a mutually agreeable price not to exceed the value estimated by 
the Congressional Budget Office in House Report 104-153. This 
provision protects both the taxpayer and Connie Lee.
    In addition, the Corporation has agreed to amend its 
articles of incorporation to reflect that serving the needs of 
lower investment grade educational institutions shall be a 
purpose of the Corporation. The Corporation will furnish 
reports to the Secretary of Education on its efforts to assist 
in the financing of educational facilities including 
elementary, secondary, and postsecondary, for a period of 2 
years after the Federal divestiture of stock.
    The privatization of Connie Lee is good policy and is 
consistent with the intent of this legislation, that is., 
controlling Federal expenditures and balancing the budget. The 
Congressional Budget Office has indicated that this provision 
will make money for the treasury. Perhaps more importantly, 
severing Connie Lee's tie to the Federal Government by selling 
the federally owned stock in the Corporation and lifting the 
Corporation's restrictive charter also removes any implicit 
contingent liability from the taxpayer in the event that Connie 
Lee ever experienced financial difficulties.

                         Eligible Institutions

    Section 4011 clarifies that the Secretary of Education 
shall not implement the 85/15 rule with respect to eligibility 
for proprietary institutions under title IV of the Higher 
Education Act of 1965--Section 481(b)(6)--on a retroactive 
basis and that, for the purpose of complying with the 85/15 
rule, any revenues earned by a proprietary institution from 
training contracts with business or industry shall be counted 
as non-title IV revenues.
    The 85/15 rule was enacted as a floor amendment to the 
Higher Education Amendments of 1992. This rule limits the 
eligibility of proprietary schools from participation in title 
IV programs to those schools receiving at least 15 percent of 
their revenues from non-title IV sources. The intent of this 
provision is simple and straight forward. For-profit, 
proprietary institutions of higher education must not be solely 
reliant on Federal student financial assistance for income. The 
committee remains concerned over the Department of Education's 
implementation of this regulation. While the rule itself is 
simple, the Department's current interpretation of it is 
baffling. For instance, the Department's regulations fail to 
count revenues from sources such as contract training, provided 
to businesses willing to pay for it, and toward the 
institution's non-Federal revenues. The intent of the 85/15 
rule was to ensure that schools were providing training which 
was of great enough value that it would be sought regardless of 
the availability of Federal funds. Clearly, this training is of 
value.
    In addition, the Department seems intent on implementing 
this regulation retroactively, at least for some proprietary 
schools. The final regulations implementing the 85/15 rule were 
published on April 29, 1994, to be enforced as of July 1, 1994, 
on the basis of a school's preceding fiscal year. During the 
last Congress, many members of this committee were troubled 
with the Department of Education's intent to enforce the rule 
in such a manner. As a result, the 1995 Labor, HHS and 
Education appropriations bill included a 1-year delay of the 
regulations published by the Department of Education 
implementing the 85/15 rule. However, the committee notes that 
the Department is again free to implement the 85/15 rule and 
that in so doing, it intends to base compliance on an 
institution's most recently completed fiscal year. For many 
schools, this will again amount to a retroactive application of 
the regulations. For example, a school which bases its fiscal 
year on the calendar year would have to show that it was in 
compliance with the regulation from January 1, 1994, through 
December 31, 1994, even though the Department's regulations 
were undergoing revision for 4 months of that year. This 
provision clarifies the intent of Congress that the Department 
of Education, when implementing the 85/15 rule, shall only 
consider an institution's financial information for a fiscal 
year which began on or after April 30, 1994. This date 
coincides with the publication date of the final regulations 
implementing the 85/15 rule and prevents any retroactive 
application of those regulations for purposes of determining an 
institution's eligibility for title IV programs.
    The committee views this as both a fairness issue and an 
access issue. Clearly, the Secretary must enforce the law. 
However, the Secretary should not hold institutions to 
standards which were not final prior to the beginning of the 
fiscal year in question. Nor should the Secretary discount 
contract training funds from industry as a source of non-
Federal revenue. Additionally, the committee is concerned that 
the Secretary's flawed interpretation of section 481(b)(6) 
might inadvertently eliminate title IV eligibility for students 
at a number of quality institutions. As we move to streamline 
the Federal Student Loan Program and reduce the profitability 
of the program for lenders, secondary markets, and guarantors, 
the committee believes it is essential to take steps such as 
this one to ensure that students have access to shorter term 
programs.
    Section 4011 will prevent the retroactive application of 
these regulations and will correct the Secretary's 
interpretation of non-title IV revenues.

                               Conclusion

    Again, committee members feel a tremendous sense of 
responsibility in recommending these reductions. We believe 
that we have come up with recommendations which meet our 
reconciliation instruction of saving $10.08 billion over 7 
years while at the same time maintaining access to a quality 
education for millions of Americans. If the Federal budget is 
ever to be balanced, and the benefits to the American people 
from doing so are ever to be realized, these steps are 
necessary. We do not shrink from this responsibility, but 
readily accept it. We are both pleased and honored to be a part 
of this monumental effort.

                     Repeal of the Davis-Bacon Act

Background

    The Davis-Bacon Act was the first of the Federal prevailing 
wage laws. The concept of a prevailing wage for workers began 
at the State level and sparked congressional interest in the 
creation of a Federal prevailing wage. Congressional hearings 
on maintaining local labor standards were first held in 1889.
    Legislation was proposed in 1927 by Representative Robert 
L. Bacon which required contractors on Federal construction 
projects to comply with State laws regulating the wages of 
employees.1 Hearings followed in 1927, 1928, and 1930 with 
the introduction of a number of bills concerning a Federal 
prevailing wage.
    \1\ U.S. General Accounting Office, ``The Davis-Bacon Act Should Be 
Repealed,'' HRD-79-18, April 27, 1979, p. 116. (Hereinafter referred to 
as ``GAO Report, 1979'').
---------------------------------------------------------------------------
    By 1931, with the Depression already underway, mass 
unemployment was on the rise. Work was scarce and there was an 
oversupply of labor which resulted in a lowering of wages. The 
private construction industry, as with other industries, was 
continuing to shrink and becoming increasingly dependent on 
public construction contracts.2 The Federal Government, in 
an effort to help alleviate the economic conditions, initiated 
a massive construction program.3 The majority of 
construction work available at that time was on Federal 
contracts for post offices, veterans hospitals, and the like. 
Contractors had no trouble finding workers who were willing to 
accept meager wages.4
    \2\ Thieblot, Armand J., Jr., ``Prevailing Wage Legislation,'' The 
Wharton School, Industrial Research Unit, University of Pennsylvania, 
1986, p. 29.
    \3\ GAO Report, 1979, supra note 1, p. 117.
    \4\ Thieblot, supra note 2, p. 29.
---------------------------------------------------------------------------
    It was these conditions which led to increased 
congressional concern that the Federal Government might 
contribute to depressing local wages by contracting with so-
called itinerant contractors who were employing aliens and 
transporting itinerant cheap labor to work on Federal jobs. 
5 Representative Bacon led the debate by blaming ``certain 
itinerant, irresponsible contractors, with itinerant, cheap, 
bootleg labor,'' for depressing the wage standards of the local 
community and for denying local contractors the chance to 
compete for Federal construction contracts. 6 
Interestingly, this argument was not given as a rationale for 
the passage of prevailing wage legislation at the State level 
or for Federal legislation proposed in the 1920's. 7
    \5\ GAO Report, 1979, supra note 1, p. 117.
    \6\ U.S. Congress, House, floor debate, ``Rates of Wages for 
Laborers and Mechanics on Public Buildings of the United States,'' 
motion to pass S. 5904, Feb. 28, 1931, passed, 71st Cong., 3d Sess. 74 
Congressional Record at 6510 (1931).
    \7\ Thieblot, supra note 2, p. 29-30.
---------------------------------------------------------------------------
    While protection of the local economy from outsiders became 
the basic philosophical argument in favor of a Federal 
prevailing wage requirement, the argument was not well 
supported at the time.8 In fact, this argument appears to 
have been an exaggeration. Out of 26 Federal building projects 
under construction in 1930, the U.S. Treasury Department showed 
that only 21 percent of the workers were outside workers and 
only 2 percent were alien workers.9
    \8\ GAO Report, 1979, supra note 1, p. 118.
    \9\ GAO Report, 1979, supra note 1, p. 118.
---------------------------------------------------------------------------
    In 1931, the Comptroller General under President Herbert 
Hoover, expressed his opinion that a Federal prevailing wage 
would: ``remove from competitive bidding on the project an 
important element of cost and tends to defeat the purpose of 
the statute--that is, to obtain a need of the United States, 
authorized by law to be acquired, at a cost no greater than the 
amount of the bid of the low responsible bidder, after full and 
free competitive bidding.'' 10
    \10\ House Education and Labor Committee, ``Legislative History of 
the Davis-Bacon Act,'' Committee print, 87th Cong., 2d Sess. 2 (1962).
---------------------------------------------------------------------------
    Nevertheless, Representative Bacon again introduced 
prevailing wage legislation while a companion bill was 
introduced by Senator James Davis. During a House hearing, 
Representative Bacon indicated that the bill ``is simply to 
give local labor and the local contractor a fair opportunity to 
participate in this building program.'' 11 In hearings on 
the legislation by Senate and House committees, there were 
reservations about the effectiveness of the legislation, but 
many feared that any changes would delay enactment. As such, 
Congress treated the legislation as an emergency measure in 
response to the unemployment situation, and the measure was 
passed and enacted into law on March 3, 1931.
    \11\ U.S. Congress, House, Congressional Record, 71st Cong., 2d 
Sess., 1931, 74, pt. 7 (6510).
---------------------------------------------------------------------------
    In its original form, the statute required that on 
contracts of over $5,000 for construction, repair, or 
alteration of any Federal building, the Secretary of Labor was 
to require contractors to pay not less than the prevailing wage 
to the corresponding classes of laborers and mechanics employed 
on similar projects in the city, town, village, or other civil 
subdivision of the State in which the buildings were 
located.12 Almost immediately, both contractors and labor 
had problems with the act. Furthermore, the act did not provide 
the Secretary of Labor with the authority to determine the 
wages or to enforce them, and contractors were able to 
circumvent the intent of the act.
    \12\ Act of March 3, 1931, ch. 411, 46 Stat. 1494(1931).
---------------------------------------------------------------------------
    Responding to these concerns, Congress passed the Davis-
Bacon Act Amendments of 1935. The threshold under the act was 
reduced to $2,000. The coverage of the act was further extended 
to cover contracts for painting and redecoration, as well as 
highways and dams. The contracting agency was given the 
authority to withhold funds from the contractor sufficient to 
pay the appropriate wages to any workers underpaid by a 
contractor. The Comptroller General was directed to keep track 
of contractors who had not met their obligations to employees 
and could bar contractors from work on Federal projects for a 
3-year period. Contractors were to pay workers weekly and in 
full. The Secretary of Labor was authorized to specify the 
wages to be paid to the various classes of workers, so that 
contractors could know what their obligations were prior to 
bidding on a Federal contract. Finally, the President was given 
the authority to suspend the act in the event of a national 
emergency.13
    \13\ Act of August 30, 1935, ch. 825, 49 Stat. 1011.
---------------------------------------------------------------------------
    The Copeland ``anti-kickback'' Act was passed in 1934 as a 
means for enforcing the Davis-Bacon Act requirements. The 
Copeland Act prohibited anyone from compelling an employee to 
return wages by ``force, intimidation, or threat of procuring 
dismissal from employment, or by any other manner whatsoever.'' 
The act prescribes a $5,000 fine or imprisonment of up to 5 
years, or both. The Secretary of Labor was given the authority 
to require all contractors on Federal construction projects to 
submit and certify weekly payroll reports detailing daily 
hours, wage rates, total earnings, and any deductions.14
    \14\ 40 U.S.C. 276(c)(1988).
---------------------------------------------------------------------------
    The Davis-Bacon Act was subsequently amended on four other 
occasions. The most recent amendments in 1964 defined wages to 
include fringe benefits, such as medical, life, and accident 
insurance as well as pension, unemployment and retirement 
benefits.15
    \15\ Act of July 2, 1964, Public Law No. 88-349, 78 Stat. 238 
(1965).
---------------------------------------------------------------------------

         Committee's Views on the Repeal of the Davis-Bacon Act

    In the committee's view, the Davis-Bacon Act should be 
repealed. The rationale which was given for its enactment in 
the 1920's and 1930's can no longer justify the continued 
existence of the act. Furthermore, the arguments in favor of a 
prevailing wage law were never very persuasive, yet the act 
remains on the books, adding millions and millions of dollars 
to Federal construction costs.
    The economic conditions which bolstered the arguments for a 
prevailing wage law have long since disappeared. The high 
unemployment of the Great Depression which was the impetus for 
passage of the act as an emergency measure, has long since 
abated. In 1931 when the Davis-Bacon Act went into effect, 
there were no minimum wage laws or other labor laws with 
protections for workers. Since that time, Congress has enacted 
numerous laws which protect the wages and working conditions of 
all workers.16
    \16\ e.g., the Fair Labor Standards Act of 1938 (minimum wage, 
payment of overtime, and child labor restrictions); the Miller Act of 
1935 (performance and payment bond requirements to assure that workers 
are paid for work performed); the Contract Work Hours and Safety 
Standards Act of 1962 (overtime for any hours worked over 8 per day); 
Social Security (unemployment compensation); the Wagner-Peyser Acts 
(employment service); the Occupational Safety and Health Act of 1970 
(safety and health conditions in the workplace); the National Labor 
Relations Act of 1935 (the right to organize and collectively bargain); 
and the Fitzgerald Act of 1937 (standards for apprenticeship training).
---------------------------------------------------------------------------
    The arguments favoring repeal put forth by the General 
Accounting Office [GAO] in a 1979 report to Congress remain as 
relevant today as then. The GAO study found that: First, the 
act is unnecessary in light of the significant changes which 
have occurred in economic conditions and worker protection laws 
since the 1930's; second, the act has been and continues to be 
impractical to administer, resulting in the Department of Labor 
developing and issuing inaccurate wage determinations; and 
third, the act is inflationary because it adds ``several 
hundreds of millions of dollars annually in unnecessary 
construction and administrative costs.'' 17
    \17\ GAO Report, 1979, supra note 1.
---------------------------------------------------------------------------

                        Significant Cost Savings

    The committee recognizes that repeal of the Davis-Bacon Act 
would result in significant savings to the taxpayers. The 
application of the act to Federal construction projects clearly 
adds to their cost. At a time when every American is being 
asked to sacrifice something in order to protect our children's 
future, it would be unconscionable to let the Davis-Bacon Act 
continue to exist. The Congress is under increasing pressure to 
balance the budget. The taxpayers are demanding that Government 
be more efficient and held accountable for the expenditure of 
their hard-earned tax dollars. Repealing the act would save 
$2.7 billion over the next 5 years, according to the 
Congressional Budget Office. Some $48 billion in annual 
construction for fiscal year 1996 will fall under coverage of 
the Davis-Bacon Act.18
    \18\ Letter of June E. O'Neill, the Congressional Budget Office, to 
Chairman Cass Ballenger, House Subcommittee on Workforce Protections, 
April 21, 1995.
---------------------------------------------------------------------------
    The burdens of the law do not fall evenly on society or the 
economy. In effect, Davis-Bacon is a tax on construction. Dr. 
Lawrence B. Lindsey, member of the Board of Governors of the 
Federal Reserve Board, concluded that:

          [In Baltimore, MD,] the estimate of the so-called 
        Davis-Bacon tax on inner city construction was between 
        5 and 10 percent. Adding 10 percent to the cost of a 
        housing unit is the equivalent of adding a full 
        percentage point to an 8 percent 30-year mortgage. In 
        short, Davis-Bacon requirements effectively wipe out 
        much of the good banks do when they lend to such 
        projects at concessionary rates.19
    \19\ Remarks by Lawrence B. Lindsey in his speech, ``Increased 
Opportunity Through Deregulation,'' before the Financial Institution's 
Joint Housing Conference in Detroit, MI, October 29, 1994.

Furthermore, the committee is concerned about the cost effects 
of Davis-Bacon requirements on State and local governments. The 
total cost of Davis-Bacon extends to State and local government 
construction programs, having the same practical implications 
as an unfunded mandate. If the Federal Government contributes 
funding toward a local project, then Davis-Bacon wages must be 
---------------------------------------------------------------------------
paid. Mayor Clarke Becker of Woodland Park, CO, testified that:

          In some cases, Federal funding for public projects 
        barely covers the costs of compliance with Davis-Bacon 
        and leaves little to be directed toward the costs 
        associated with the actual project construction. 
        Numerous cities have been forced to scale back and even 
        eliminate public projects because of the additional 
        financial burden the Davis-Bacon provisions impose. 
        Such decisions cause delays in the construction and 
        repair of essential public infrastructure and as a 
        result, put our citizens at risk.20
    \20\ Testimony of Mayor Clarke Becker, Woodland Park, CO, on behalf 
of the National League of Cities, before the House Subcommittee on 
Workforce Protections, Serial No. 104-21, February 15, 1995, p. 21.

The cost impact of Davis-Bacon requirements is particularly 
burdensome in the area of school construction. The Davis-Bacon 
Act severely hampers the ability of school districts to reduce 
construction costs. Many of the Nation's public schools are in 
a state of disrepair, at a time when State, local, and Federal 
funding for the much-needed upgrades and renovation is 
declining. As Boyd W. Boehlje, president of the National School 
Boards Association, testified before the Senate Committee on 
---------------------------------------------------------------------------
Labor and Human Resources:

          The Davis-Bacon Act has skewed local decisionmaking 
        regarding the school districts' ability to accept 
        Federal funds to meet their construction needs. One 
        anecdote was recently related by a former Loudoun 
        County, VA, school board member about building the 
        Monroe Vocational Technical Center in Leesburg, VA. The 
        school board sought to tie in the Federal vocational 
        education funds for construction. The State was offered 
        a Federal grant for $24,000. The Loudoun County school 
        board declined the grant because the Federal funds 
        would have been spent on the required Davis-Bacon 
        wages.21
    \21\ Testimony of Boyd W. Boehlje, president of the National School 
Boards Association, before the Senate Committee on Labor and Human 
Resources, S. Hring. 104-18, February 15, 1995, p. 13.
---------------------------------------------------------------------------

               Integrity and Costs of Public Contracting

    The primary criticism of the Davis-Bacon Act over the years 
has been the requirement that contractors pay higher than 
market wages and benefits on Federal construction. Editorial 
writers throughout the country have repeatedly characterized 
the law as special interest legislation designed to protect one 
group of beneficiaries at the expense of other construction 
workers, contractors, and taxpayers.22
    \22\ ``Two Thumbs Down On the Davis-Bacon Act: What Are Newspaper 
Columnists and Editors Across the Country Saying about the Davis-Bacon 
Act?'' The Coalition to Repeal the Davis-Bacon Act, 1995, passim.
---------------------------------------------------------------------------
    Recently public scorn has increased since the release of an 
investigative report detailing widespread fraud in the survey 
process used by the Department of Labor to determine prevailing 
wages. This report, entitled ``The Davis-Bacon Act and 
Fraudulent Wage Data Submitted to the U.S. Department of 
Labor,'' 23 uncovered numerous instances in Oklahoma of 
interested parties claiming phantom projects and ghost 
employees, all with the intent of inflating the official wage 
rates issued by the Department of Labor. In some instances, 
employees were allegedly paid $5 to $10 an hour more than 
actual market wages in the area. After repeated demands by 
local authorities and the involvement of members of this 
committee, the Department of Labor revoked the wage 
determinations in Oklahoma City and Tulsa because of the 
allegations of fraudulent data.
     23 ``Wage Requirements to be Yanked, Officials Say,'' 
Oklahoman Times, July 29, 1995.
---------------------------------------------------------------------------
    Scandals of the nature of the Oklahoma experience erode 
public confidence in the Government procurement process. The 
Department of Labor has been unable to satisfy the committee 
that similar and other abuses of the survey process do not and 
cannot occur elsewhere. The committee believes that repeal of 
Davis-Bacon is the best means of eliminating further potential 
for abuse in the process and restoring vital public confidence.

                        Free Market Competition

    The committee believes that repeal of the Davis-Bacon Act 
would allow for free market competition in Federal construction 
contracting. The act serves as an impediment to small and 
minority businesses, which might otherwise participate in 
Federal construction contracting. Contractors who pay less than 
Davis-Bacon wages on private construction projects are deterred 
from bidding on Federal projects because they fear the 
disruptive effects of two-tier pay scales. Consequently, 
contracts for Federal construction projects attract less 
competition and higher winning bids.
    The Subcommittee on Workforce Protections heard testimony 
from Cindy Athey, president of Precision Wall Tech, Inc., about 
the problems with two-tier pay scales.24 Her painters, for 
example, are paid $21.24 per hour on Federal projects, compared 
with $14 per hour on private projects. In her opinion, the 
Davis-Bacon wage scale deters workers from being productive and 
efficient. In particular, it becomes a problem when her workers 
go back to performing private work and she is forced to lower 
their wages to the true market rate.
     24 Testimony of Cindy Athey, president of Precision Wall 
Tech, Inc., before the House Subcommittee on Workforce Protections, 
Serial No. 104-21, February 15, 1995, p. 5, 6.
---------------------------------------------------------------------------
    The Subcommittee on Workforce Protections heard testimony 
from Karen Kerrigan, president of the Small Business Committee, 
about the effect of the Davis-Bacon Act on competition:

          Wages are best determined in a competitive 
        marketplace, not according to the unrealistic estimates 
        from government bureaucrats in Washington, DC. The 
        market allows wages and costs to adjust according to a 
        host of criteria, including competition, skill levels 
        and productivity, demand, supply, capital investment, 
        et al. The Davis-Bacon Act's wage criteria distort the 
        marketplace, artificially favoring large businesses 
        over small entrepreneurial firms; and higher-skilled 
        and higher-paid workers over less-experienced, lower-
        skilled workers, regardless of job criteria. Lack of 
        competition, increased paperwork, and inflated wages 
        mean higher costs for taxpayers and the economy.25
     25 Testimony of Karen Kerrigan, president of the Small Business 
Survival Committee, before the House Subcommittee on Workforce 
Protections, Serial No. 104-21, February 15, 1995, p. 14.

The inflated wage levels under the Davis-Bacon Act and the 
specialized administrative requirements in effect create a 
government-favored class of both workers and contractors, 
shutting out those who are unable to match these artificial 
wages or to master the necessary complexities. In sum, a world 
of protectionism is created by the act to protect a select few 
---------------------------------------------------------------------------
at the expense of the taxpayer. As one contractor noted:

          Many businesses, small and large alike, find the 
        restrictions associated with the Davis-Bacon Act too 
        difficult and too costly to make participation in 
        Federal work a viable option. Without Davis-Bacon, 
        Federal work could be bid on an open playing field like 
        private work * * *
          Davis-Bacon creates a special niche in the 
        construction market, accessible only to certain 
        contractors. These contractors have a virtual monopoly 
        on Davis-Bacon work and on the subsidy that comes with 
        this work. * * * Davis-Bacon is about inflated wages 
        being funneled to a small industry segment at a high 
        cost to taxpayers. * * * 26
     26 Letter of Mr. Gary E. Hess, president, Hess Mechanical 
Corporation, Upper Marlboro, MD, to Chairman William F. Goodling, 
Committee on Economic and Educational Opportunities, September 21, 
1995.

Significant in the legislative history of the act is the 
absence of any mention of an intent to drive up or prop up area 
wages in the private sector. The only concern expressed by 
supporters of the law during the Great Depression was a desire 
to prevent the Federal Government's massive construction 
initiative from driving down wages. The framers of the wage-
setting law expressed no goal of inflating private wages on 
private construction.
    The opponents of repeal, however, have adopted just such a 
rationale. By some estimates, repeal of the Davis-Bacon Act 
would result in a decrease in all construction wages by almost 
$1,500 yearly.27 The estimate suggests either a primary 
rationale for repeal, or its own inaccuracy.
    \27\ Mangum, Garth, et. al., ``Losing Ground: Lessons from the 
Repeal of Nine `Little Davis-Bacon' Acts,'' University of Utah, 
February, 1995.
---------------------------------------------------------------------------
    If the calculations are accurate, then the Davis-Bacon Act, 
designed to mirror the private sector, has evolved into an 
industry-wide minimum. The law would thus have the effect of 
inflating not just Federal construction, but all private 
construction as well. The impact on the economy would therefore 
be far beyond the Congressional Budget Office estimate of $2.7 
billion over 5 years. Such estimates prove the point that the 
Davis-Bacon Act is unrestrained social engineering and 
inflationary.
    In the converse, denial of the logical results of the 
$1,500 loss per employee proves the inaccuracy of the estimates 
themselves. Either the act improperly drives up the costs for 
all construction, or the estimates are flawed. In either case, 
the benefits of repeal are reinforced.
    Repeal of the Davis-Bacon Act would enhance free market 
competition because it removes the artificial and outmoded job 
classifications found in the wage determinations issued by the 
U.S. Department of Labor. The Department seeks to identify and 
classify the thousands of construction jobs performed 
throughout the country. While such a task may have been easier 
in the 1930's when union jurisdictional rules dictated 
practice, modern construction is highly complex. Actual work 
practices vary within regions, across towns, and even within 
companies. In many smaller companies, job assignments are 
exceedingly individualized and pay scales are adjusted 
accordingly. No form of legislative or administrative reform 
can satisfy the need of the industry for classifications which 
match the true work environment.

                      Increased Job Opportunities

    The committee believes that repeal of the Davis-Bacon Act 
would increase job opportunities and reduce discrimination 
against unskilled workers, many of whom are minorities. Not 
only does the Davis-Bacon Act drive up the cost of 
construction, but it tends to deprive local residents of job 
opportunities. While Davis-Bacon was intended to protect the 
local wage structure, local contractors and workers today are 
closed out of projects in their own communities by the very law 
designed to protect their existence.
    As Sara Jean Lindholm, chairman of City Lands Corp. a 
community development banking institution, noted in testimony 
before the Subcommittee on Labor Standards, Occupational Health 
and Safety:

          The present structure and implementation of these 
        requirements presents a major obstacle to comprehensive 
        community development in the inner cities and a major 
        stumbling block to equality of opportunity. As I 
        understand it, a major intent of the Davis-Bacon Act 
        was to ensure that Federal contracts reflect the local 
        labor market, which should not be disrupted by the 
        importation of outside labor. However, from the vantage 
        point of the inner city, implementation of the act 
        today leads to exactly the reverse outcome and denies 
        neighborhood residents the opportunity to work on 
        projects that are designed to redevelop their own 
        communities * * *
          Specifically, the effect of the implementation of the 
        act has been to ensure that virtually all federally 
        subsidized housing projects in the inner city--where 
        jobs are desperately scarce--are constructed using a 
        majority of imported labor from the suburbs and from 
        other more affluent city neighborhoods * * * Not only 
        are we needlessly inflating the cost of producing 
        affordable housing, but we are failing to generate the 
        economic and socially beneficial spin-off created by 
        local employment.28
    \28\ Testimony of Sara Jean Lindholm, chairman of City Lands 
Corporation, before the Subcommittee on Labor Standards, Occupational 
Health and Safety, Serial No. 103-5, May 4, 1993, p. 57, 58, 61.

    The Davis-Bacon Act works to the disadvantage of unskilled 
or low-skilled laborers, who desperately need on-the-job 
training to become skilled craftsmen. An unskilled worker must 
be paid the same wage as a skilled worker, thereby creating a 
disincentive for contractors to hire the unskilled worker. For 
example, if a company is required under Davis-Bacon to pay a 
worker in a particular job classification $15 per hour, it is 
going to hire a skilled worker, thus effectively shutting out 
those who most need the opportunity to acquire job skills and 
work experience. Essentially, Davis-Bacon requires companies to 
use overqualified employees for menial tasks or to overpay 
inexperienced employees.

         Elimination of Unnecessary Recordkeeping Requirements

    Repeal of the Davis-Bacon Act and the related Copeland 
``anti- kickback'' Act would reduce unnecessary paperwork and 
record- keeping requirements. The current requirements for 
certified weekly payroll reports detailing daily hours, wage 
rates, total earnings, and deductions are onerous. Businesses 
spend approximately $100 million per year \29\ in order to 
comply with the recordkeeping requirements. Many contractors 
must hire additional employees and equipment in order to keep 
up with the weekly certified payroll reports.
    \29\ Kerrigan, supra note 25, p. 13.
---------------------------------------------------------------------------
    Vice President Gore's National Performance Review report 
``From Red Tape to Results: Creating a Government that Works 
Better and Costs Less,'' suggested that detailed reporting 
under the Copeland Act was an unreasonable burden on Federal 
contractors. The report recommended eliminating the weekly 
payroll reports. \30\
    \30\ ``From Red Tape to Results: Creating a Government that Works 
Better and Costs Less,'' Report of the National Performance Review, 
September 7, 1993, p. 31.
---------------------------------------------------------------------------
    Finally, the committee notes that there are some 
beneficiaries of the act who tout reform as a reasonable 
alternative to repeal. They suggest a rise in the threshold and 
a reduction in paperwork requirements. At the same time, 
however, they would expand coverage of the act to off-site work 
and new job classifications. They would also permanently ban 
the use of work classifications which are actually prevailing 
in private construction, such as helpers, semiskilled workers 
who assist a skilled tradesman. The committee does not believe 
that such recommendations constitute reform. Furthermore, the 
committee believes that the problems with the Davis-Bacon Act 
are not merely technical or administrative; they are 
fundamental. The history of the Service Contract Act 
illustrates that repeated efforts to amend flawed prevailing 
wage policy results in further bureaucratic burdens and market 
disruptions. No amount of fine-tuning can adjust for the 
increasingly innovative and competitive realities of the 
construction industry today.
    In sum, the Davis-Bacon Act hinders efficiency and 
opportunity in Federal construction contracting. The act is 
expensive, unnecessary, incapable of effective administration, 
anti-competitive, and discriminatory. For these reasons, the 
committee recommends that the Davis-Bacon Act be repealed.

                   Repeal of the Service Contract Act

                               Background

    The issue of providing service employees with specific 
labor standards protections was not a new idea. Workers 
employed by other types of contractors performing Government 
work had enjoyed specific wage and benefit protections for 
years. In 1931, the Davis-Bacon Act was the first of the 
prevailing wage laws enacted to cover Federal construction 
contracts valued at $5,000 or more (it was later dropped to 
$2,000). And, in 1936, the Walsh-Healey Public Contracts Act 
provided a minimum wage requirement for employees of 
manufacturing and supply companies who did business with the 
Federal Government on contracts in excess of $10,000.
    In the 88th Congress 1963-64, hearings were conducted on 
this issue and a bill was reported by the House Committee on 
Education and Labor. However, the measure failed to clear the 
Rules Committee. In the 89th Congress, 1965-66, an initiative 
was offered by Representatives Tom Pelly and James O'Hara and 
endorsed by Senator Patrick McNamara, chairman of the Senate 
Committee on Labor and Public Welfare. The Johnson 
administration supported the proposal and the Service Contract 
Act (SCA) was signed into law in October, 1965.
    The SCA, officially called the O'Hara-McNamara Services 
Act, covers all contracts with the Federal Government in excess 
of $2,500 whose primary purpose is to provide services to the 
Government. At the time of enactment, employees typically 
covered by the SCA were blue collar workers, semiskilled or 
unskilled performing manual work or craft work.\31\ Types of 
service contracts covered by the Act were varied and include 
laundry and drycleaning, custodial and janitorial, guard 
service, packing and crating, food service, and miscellaneous 
housekeeping services.\32\
    \31\ U.S. Congress, House Committee on Education and Labor, 
``Service Contract Act of 1965.'' H. Rept. 948, 89th Cong., 1st Sess., 
1965, p.2.
    \32\ Ibid.
---------------------------------------------------------------------------

                         Problems with the Act

    Throughout its 30 year history, the Service Contract Act 
has been plagued with problems. ``Within eight months of 
adoption, the Labor Department's Wage and Hour Administration 
proposed to the Congress that some original provisions of the 
Act be amended because they were already 'unnecessary and 
outdated.'' \33\
    \33\ Burns, Beverly Hall, ``The Service Contract Act of 1965: Time 
to Revise or Repeal,'' Villanova Law Review 29 (1983-1984): 221.
---------------------------------------------------------------------------
    As a result of difficulties with the administration of the 
SCA, hearings in 1972 revealed the Department of Labor [DOL] 
had not made wage determinations in more than two-thirds of all 
service contracts and that contract turnover was frequent.\34\ 
The 1972 amendments to the SCA extended coverage and expanded 
the Department of Labor's responsibilities and powers.\35\
    \34\ Ibid.
    \35\ Act of October 9, 1972, Pub. L. No. 92-473, 3(c), 86 Stat. 789 
(codified at 41 U.S.C. 353(c) (1976)). The new provisions included: (1) 
a mandate that the Department issue wage determinations for all 
government service contracts subject to the Act as soon as 
administratively feasible, according to a time schedule specified in 
the amendments; (2) a requirement that successor contractors pay 
service employees wages and fringe benefits no lower than those to 
which the predecessor contractor committed by a collective bargaining 
agreement; (3) multi-year contracts of up to five years if approved by 
the Secretary of Labor and, if wages and fringe benefits were adjusted 
every two years; and (4) a provision to require that in establishing 
prevailing rates, due consideration be given to the federal wage board 
rate applicable for similar work under civil service regulations.
---------------------------------------------------------------------------
    By 1976, the SCA continued to have serious administrative 
and enforcement problems. While DOL's role in making wage 
determinations had improved, procuring agencies sometimes 
failed to notify the Department that determinations were needed 
and were letting contracts without ever asking for the 
determinations to be made. Second, the definition of a service 
employee continued to be problematic. In a judicial decision, 
the U.S. District Court for the Middle District of Florida \36\ 
found that Congress intended for the act to be limited in its 
coverage to blue-collar workers doing jobs similar to wage 
board classifications issued for Federal service. A similar 
issue involving classification had arisen in a 1974 case, in 
which the U.S. District Court for Delaware \37\ held that 
keypunch operators were not service employees according to the 
meaning of the SCA.
    \36\ Federal Elec. Co. v. Dunlop, 419 F.Supp. 221, 225 (M.D. Fla. 
1976).
    \37\ Descomp, Inc. v. Sampson, 377 F.Supp. 254 (D.Del. 1974).
---------------------------------------------------------------------------
    Responding to the Federal court rulings, the 1976 
amendments expanded the definition of service employees to 
include anyone working on a Government service contract other 
than a bona fide executive, administrative or professional 
employee. The amendments reiterated that services include any 
operations, other than those specifically exempted in the 
original Act, that do not result in a physical product.

                          The Need for Change

    Given the troubled history of the Service Contract Act, the 
committee believes it is time to repeal this law. Nearly 30 
years after its enactment, the SCA denies small business the 
opportunity to compete for Federal contracts, costs taxpayers 
billions in inflated wages, and has significant administration 
problems, with the inability to make accurate wage 
determinations from available data the most serious. \38\ As 
noted by Attorney Beverly Hall Burns during subcommittee 
testimony:
    \38\ The Honorable Harris Fawell, meeting with House Economic and 
Educational Opportunities Committee Staff, Washington, D.C., June 1995.

        The purpose for which the law was adopted--and the 
        application of it today--bear little resemblance to 
        each other. In 1965, when Jim O'Hara and Robert 
        McNamara sponsored the act, it was with the laudable 
        purpose of preventing the exploitation of the most 
        marginal workers in America--the service employees who 
        did laundry, fixed meals and cleaned up governmental 
        facilities. Within 15 years of its adoption, the act 
        was being applied to university researchers and high 
        technology specialists as well, and even today, many of 
        the workers thought protected by the act--those with 
        specialized training and skill in hazardous waste 
        cleanup for example--are actually in high demand. They 
        don't need the protection of the act, so in a very real 
        way, the dollars spent in its enforcement are wasted 
        dollars.\39\
    \39\ U.S. Congress, House Subcommittee on Workforce Protections, 
``Davis-Bacon and the Service Contract Acts,'' 104th Cong., 1st Sess., 
1995.

Also, the General Accounting Office [GAO] issued 23 reports 
prior to 1983 in which specific coverage, enforcement, or wage 
determination issues involving the SCA were discussed.\40\ The 
GAO capped its criticism of the SCA in a general oversight 
report of January 31, 1983 by stating ``GAO believes that 
Congress should consider repealing the Service Contract Act.'' 
\41\ Reasons for repeal include:
    \40\ Congressional Research Service, ``The Service Contract Act of 
1965,'' (Washington, D.C.: Library of Congress, [1987]), p. 16.
    \41\ U.S. Congress, General Accounting Office, ``The Congress 
Should Consider Repeal of The Service Contract Act,'' HRD-83-4, Office, 
1983), p. i.
---------------------------------------------------------------------------
    Inherent problems exist in its administration.
    Wage rates and fringe benefits set under it are generally 
inflationary to the Government.
    Accurate determinations of prevailing wage rates and fringe 
benefits cannot be made using existing data sources.
    The data needed to accurately determine prevailing wage 
rates and fringe benefits would be very costly to develop.
    The Fair Labor Standards Act and administrative procedures 
implemented through the Federal procurement process could 
provide a measure of wage and benefit protection for employees 
the act now covers.\42\
    \42\ Ibid.
---------------------------------------------------------------------------
    The GAO report concluded that ``for Labor to administer the 
act in a manner that would ensure accurate and equitable 
service wage determinations would be impractical and very 
costly and that the most logical alternative is to repeal the 
act.'' \43\
    \43\ Ibid., p. v.
---------------------------------------------------------------------------
    The President's Private Sector Survey of Cost Controls, 
known as the Grace Commission Report, also issued in 1983, 
conducted an exhaustive study of the law, including review of 
all prior investigations and an independent analysis of the 
Labor Department's procedures and administration. It found 
similar grounds for repeal.\44\
    \44\ Grace, Peter, ``President's Private Sector Survey on Cost 
Control,'' Report on the Department of Labor, August 31, 1995.
---------------------------------------------------------------------------
    As has frequently been the case, past reforms have 
exacerbated the problems with the act, expanded coverage, and 
led to further waste and abuse. As this committee attempts to 
respond to the call of the American people to streamline 
Government and make it work more effectively, repealing the 
Service Contract Act is a needed first step and will lead to a 
more efficient, responsible, and frugal Government.
    This committee believes that the Service Contract Act 
should be repealed. It specifically adopts the rationale of 
Representative Harris Fawell, the sponsor of repeal 
legislation, that the Service Contract Act ``like the Davis-
Bacon Act, artificially increases the cost of Federal 
Government service contracts and imposes burdensome paperwork 
requirements on contractors in order to prove compliance with 
the law. The SCA also presents a number of pragmatic problems 
which undermine the effective administration of the act.'' \45\ 
Specifically, the SCA applies to highly skilled or college-
educated workers who do not need or require regulation by the 
act.
    \45\ The Honorable Harris Fawell, Statement to the House of 
Representatives to repeal the O'Hara-McNamara Service Contract Act, 
Washington, D.C., January 5, 1995.
---------------------------------------------------------------------------

                            Taxpayer Savings

    In addition to the failure of the policy underlining the 
SCA, discussed more fully below, the committee supports repeal 
because it yields taxpayer savings. The SCA inflates the cost 
of Federal Government contracts, causing the Federal Government 
to waste millions of dollars per year by paying more for 
services such as computer programming, travel services, 
building security, information services, grounds upkeep, and 
technical services than would be necessary if competitive 
bidding occurred. According to the Congressional Budget Office 
[CBO] repeal of the SCA will save at least $3.168 billion over 
5 years and $4.585 billion over 7 years.

   Prevailing Wage Requirement is Inherently Defective and Does Not 
                        Reflect the Marketplace

    The prevailing wage concept requires the Government to 
determine wage and benefits for service contracts in excess of 
$2,500, covering virtually all Federal contracts for services. 
Under the SCA, the Department of Labor determines prevailing 
wages in accordance with the prevailing rates for employees in 
the locality where the work will be performed. The Department 
of Labor wage determination process has been criticized because 
frequently the wage rates and benefits mandated by the 
Government have very little relationship with real-world 
prevailing wage rates and benefits. Often, the mandated wage 
rates and benefits are much higher than would be paid under 
normal market conditions. As noted by the National Council of 
Chain Restaurants,

          In determining the prevailing rate, which is the 
        minimum starting wage, the DOL uses the median wage of 
        what it believes to be comparable workers, and 
        establishes that as the minimum rate at which employees 
        working at the subject establishment must be paid. 
        Because the DOL uses the median prevailing wage as the 
        minimum rate under the SCA, the wages that must be paid 
        to employees working at the retail operation located on 
        the military base are substantially higher than what is 
        paid to employees performing the same work at nearby 
        establishments located off the military base.\46\
    \46\ U.S., Congress, House, Committee on Economic and Educational 
Opportunities, Davis-Bacon and the Service Contract Acts, Serial No. 
104-21, 104th Cong., 1st Sess., 1995, p. 319.

The Society of Travel Agents in Government [STAG] representing 
travel agencies and others involved in the $20 billion 
Government travel market, further illustrates inherent 
---------------------------------------------------------------------------
difficulties with the prevailing wage concept.

          First, since small business employers must pay 
        artificially high wages, fewer employees can be hired. 
        Second, since the pay of the employees working on 
        Government contracts drains the employer's resources, 
        the fringe benefits unique to this industry often 
        cannot be offered. Third, while travel agencies are 
        forced to pay the high wages to employees working on 
        Government accounts, they cannot afford to do so to 
        their other employees. This results in a disparity of 
        wages within the travel agency which is not based on 
        any difference in skill or experience, which leads to 
        animosity among employees and a poorer working 
        environment, and less interest in competitively bidding 
        Government contracts.\47\
    \47\ Ibid., p. 328.
---------------------------------------------------------------------------
    As this example illustrates, the Service Contract Act 
results in problems for employers and employees and the 
taxpayer ends up footing the bill.\48\
    \48\ Ibid., p. 329.
---------------------------------------------------------------------------
    In addition to paying prevailing wages, the SCA requires 
the payment of prevailing fringe benefits. A contractor may 
satisfy this requirement by providing any equivalent 
combination of benefits or by making equivalent payments in 
cash. Frank Bazler testifying on behalf of Hobart Corp., one of 
the leading manufacturers and marketers of commercial food 
preparation, cooking, refrigeration and warewashing equipment, 
testified about problems in this area:

          Many Hobart service offices have only two or three 
        service technicians. These may include senior 
        technicians as well as new hires in training. Obviously 
        the wages and vacations provided to these employees are 
        widely varied. If a service office has a service 
        contract with the Federal Government and its senior 
        technician is ill or on vacation, it may be necessary 
        to provide service with a younger and newer technician 
        who may meet the wage requirements but not the vacation 
        requirements, thus causing a violation unless separate 
        compensating wages are calculated and paid. * * * (A 
        recent example of this was a requirement under SCA in 
        the New England area that the service technician be 
        given 4 weeks of vacation. Hobart employees do not 
        receive 4 weeks of vacation until after they have been 
        with the company for 15 years. The end result of this 
        unreasonable requirement was that Hobart elected not to 
        enter into the service contract.) \49\
    \49\ Ibid., p. 331.

    The preceding example illustrates a major change over time, 
in the focus of the law. Consider that Department of Labor wage 
determinations in the Washington, DC metropolitan area range 
from $16 to $27 an hour. These pay rates cover engineers, 
nurses, technicians, and photographers. A computer system 
analyst III earns $27.66 an hour and an engineering technician 
VI earns $22.26 an hour. These are not the typical low-wage 
workers the act was designed to cover.
    The committee believes one of the basic tenets of labor- 
management relations is the opportunity for employers and 
employees to negotiate with each other based on merit, skills, 
and experience. Under the SCA, as illustrated by these 
examples, the Government mandates a difficult bureaucratic 
procedure resulting in government control over wages and 
benefits and even job descriptions when in reality market 
principles offer the best solution.

   Repeal of the SCA results in New Job Opportunities and Competition

    The committee believes repeal of the SCA would allow the 
market to determine wages, ensuring competition for service 
contracts as well as lowering Government interference in 
private business activities. In addition, repeal of the SCA 
would enable more businesses to compete for Federal contracts, 
creating new job opportunities.
    The Association of Independent Scientific Engineering and 
Testing Firms, represents 400 companies, a majority of which 
are small businesses. These firms perform scientific testing 
and engineering services for the $8 billion testing laboratory 
market. The scope of the testing services include: construction 
materials, geological, pharmaceutics, environmental, food, and 
analytical chemistry. In a letter to Representative Harris 
Fawell, this association stated:

          * *  a [company] with approximately 200 persons 
        working in their Federal programs division estimates 
        they would incur upwards of $200,000 in company-wide 
        incremental costs if the firm took on work with SCA 
        requirements. Not included in this estimate are the 
        costs for additional benefits changes that would be 
        needed for compliance. Industry profitability is very 
        low for analytical laboratories and SCA compliance 
        costs cannot be absorbed easily. Thus, this firm is 
        caught between foregoing much needed revenues or 
        accepting SCA projects that will reduce or eliminate 
        profits.50
    \50\ Letter of ACIL to the Honorable Harris Fawell, 4 April 1995, 
Anthony Pagliaro Papers, Washington, D.C.

Hobart Corp. testified that it does not bid on SCA contracts 
because of the redtape imposed by the requirements of the act. 
This deprives the Government of the highest quality 
services.51
    \51\ U.S., Congress, House, Committee on Economic and Educational 
Opportunities, Davis-Bacon and the Service Contract Act, Serial No. 
104-21, 104th Cong., 1st Sess., 1995, H.R. 246, p. 308.
---------------------------------------------------------------------------
    Finally, Beverly Hall Burns provided the following example 
during congressional testimony.

          Consider how a DOL wage determination can affect the 
        ability of a small employer--a minority or women-owned 
        company, for example--to make a competitive bid: In one 
        GAO study, the bulk of Labor Department wage 
        determinations had relied for data on BLS surveys of 
        businesses well over 50 employees. Indeed, in larger 
        metro areas, the BLS generally excluded from its data 
        base employers of fewer than 100 employees. 
        Nonetheless, requests for Service Contract Act wage 
        determinations have generally indicated a need for 
        fewer than 50 employees. Reliable studies show that 
        larger organizations are likely to pay higher wages 
        than small companies. To base a wage determination on 
        the wage paid by big employers is to effectively bar 
        smaller companies from the opportunity to compete and 
        win Federal contracts for services.52
    \52\ Ibid., p. 296.

Whether or not, the SCA protects the most vulnerable service 
workers, it has the clear effect of hindering the most 
vulnerable of companies--small businesses. A policy that seeks 
to protect workers, but deprives them of potential job 
opportunities is a failure.

   Current Labor Laws Offer Service Contract Workers Many Protections

    In 1965, when the law was adopted, its stated purpose was 
to prevent the exploitation of the most marginal workers--
service employees who did laundry, fixed meals or cleaned 
government buildings. At the time of enactment, service 
employees were not covered by the Fair Labor Standards Act 
[FLSA]. Service employees gained protection under the FLSA--
minimum wage and overtime protection--in 1966. In addition, 
these employees are currently covered by a host of labor laws 
including: the Contract Work Hours and Safety Standards Act of 
1962--overtime for any hours worked over 8 per day; Social 
Security--unemployment compensation; the Wagner-Peyser Acts--
employment service; the Occupational Safety and Health Act of 
1970--safety and health conditions in the workplace; and the 
National Labor Relations Act of 1935--right to organize and 
collectively bargain.

             The SCA Includes Many Burdensome Requirements

    The burdens of compliance with the regulatory scheme under 
the SCA discourages qualified businesses from competing for 
Federal contracts and deprives the Federal Government of the 
broadest range of suppliers, thus reducing competition and 
increasing costs to the taxpayer. Consider, for example, that 
SCA job classifications are being misapplied to Ph.D.-educated 
individuals performing sensitive scientific analyses.53 
This is inappropriate because many scientific and engineering 
jobs are not routine service positions. Another company 
involved in this testing industry notes ``no firm is going to 
pay $10.95 an hour--the wage determination set for entry level 
positions located in a rural southern State local for a 
perfectly trainable high-school educated person when a recent 
college graduate in chemistry can be hired for the same rate.'' 
54
    \53\ Letter of ACIL to the Honorable Harris Fawell, April 4, 1995, 
Anthony Pagliaro Papers, Washington, DC.
    \54\ Ibid
---------------------------------------------------------------------------
    An explanation provided by Hobart Corp. indicated some of 
the burdensome recordkeeping requirements under the SCA. ``The 
recordkeeping [requirements mean] * * * additional work which 
must be performed under the Service Contract Act. This means 
setting up a separate file for each service technician and 
other employees who work under the Service Contract Act. This 
takes a clerical employee out of that employee's regular 
routine to prepare the separate file. The file must be 
maintained for a minimum of three years. This entire procedure 
is more extensive than the procedure used for service 
technicians and other employees who are working on 98 percent 
of the service work in the office.'' 55
    \55\ U.S. Congress, House, Committee on Economic and Educational 
Opportunities, Davis-Bacon and the Service Contract Acts, H. Rept. 104-
21, 104th Cong., 1st sess., 1995, p. 307.
---------------------------------------------------------------------------
    The difficulties experienced by Mr. Bazler's company are 
compounded when applied to small businesses which do not have 
the administrative support or resources to satisfy these 
tremendous compliance burdens of the law. Again, testing 
laboratories indicated that ``[t]he Act's administrative 
requirements are very costly. Small businesses and small-
disadvantaged professional services firms particularly shun 
Federal work containing SCA requirements. For example, one 
small, southwestern based [company] generates 50 percent of its 
revenues by providing environmental and geotechnical 
engineering services for the Department of Energy [DOE]. 
However, this company will not bid on DOE environmental and 
geotechnical contracts stipulating SCA requirements because 
these contracts become complicated and burdensome to 
administer.'' 56
    \56\ Letter of the ACIL to the Honorable Harris Fawell, April 4, 
1995, Anthony Pagliaro Papers, Washington, DC.
---------------------------------------------------------------------------
    In conclusion, the committee believes that the prevailing 
wage concept underlying the SCA is flawed, incapable of 
accurate administration, and is burdensome to small business 
and taxpayers. Wage surveys, when they are conducted, skew 
results heavily in favor of higher than market wage rates. 
These inflated rates, coupled with the administrative and 
practical burdens, discourage bidding on Federal work by many 
qualified businesses. This restraint on competition hinders job 
growth, deprives the Federal Government of the highest quality 
of services and raises costs.
    Repeated efforts to reform the SCA have proved that the law 
is fatally flawed and, for all of the foregoing reasons, must 
be repealed.

 Provisions Relating to the Employee Retirement Income Security Act of 
                                  1974

Background and views

    The committee has become aware of the problems created 
under current law Federal pension regulations for various 
pension plan participants who have requested the payment of 
their pension benefits only to experience what they consider to 
be unnecessary delays. Under ERISA section 205, benefit 
payments from a pension plan subject to the qualified joint and 
survivor rules may be paid in a form other than a qualified 
joint and survivor annuity [QJSA] or a qualified preretirement 
survivor annuity [QPSA], if the participant waives the QJSA or 
QPSA and certain notice, election, and spousal consent 
requirements are satisfied. Regulations relating to section 205 
provide that in the case of a QJSA, a written explanation must 
generally be provided to participants no less than 30 days and 
no more than 90 days before the annuity starting date. The 
participant's election to waive the QJSA and the spousal 
consent must be made no more than 90 days before the annuity 
starting date. Thus, even if a participant elects to waive the 
QJSA and the spouse has consented to the distribution, the 
distribution from the plan cannot be made until 30 days after 
the written explanation has been provided to the participant.
    This 30-day delay in the distribution of benefits may be a 
hardship to participants and surviving spouses. Current 
technology should enable pension plans to distribute requested 
benefits on a more timely basis to participants and their 
beneficiaries.
    The committee considers the current regulations related to 
the 30-day waiting period for pension distributions to be 
unnecessarily restrictive and in some cases harmful to plan 
participants and surviving spouses facing hardship. Therefore, 
subtitle C provides appropriate relief by allowing the 30-day 
waiting period to be waived if so elected by the plan 
participant and, if applicable, the participant's spouse.

                           Section by Section

    Section 4000 provides the table of contents.
    Section 4001(a) provides that the short title of this 
subtitle is the Higher Education Program Efficiency Act of 
1995.
    Section 4001(b) establishes an effective date of January 1, 
1996, unless otherwise provided.
    Section 4002(a) terminates (1) the authority for the Direct 
Loan Program on June 30, 1996; (2) the authority of the 
Secretary to lend funds after June 30, 1996 and prohibits the 
payment of fees to institutions as of January 1, 1996; and (3) 
the authority of the Secretary to enter into participation 
agreements with institutions.
    Section 4002(b) rewrites the current section 458 of the 
Higher Education Act. The amount of administrative funds 
available for payment of indirect administrative expenses 
pursuant to section 458 is reduced to $110 million dollars for 
fiscal year 1996 with $40 million dollars allotted for payment 
of administrative costs to guaranty agencies for October, 
November, and December of 1995, and $70 million dollars in each 
of the fiscal years 1997 through 2002. Direct administrative 
expenses and indirect administrative expenses are defined for 
purposes of this section. Expenditures for indirect 
administrative expenses and loan servicing for loans under part 
D are limited to 30 percent of funds available.
    Section 4002(c)(1) strikes language which refers to the 
transition to direct lending and corrects an incorrect 
citation.
    Section 4002(c)(2) strikes the paragraph which gives the 
Secretary the authority to recall loans from guaranty agencies 
in order to proceed with the orderly transition to direct 
lending. This provision now mirrors the pre-1993 reconciliation 
language and requires the Secretary to consult with a guaranty 
agency about its collection efforts prior to recalling loans.
    Section 4002(c)(3) strikes the Secretary's ability to 
terminate a guaranty agency's agreement in order to ensure an 
orderly transition to the Direct Loan Program.
    Section 4002(c)(4) strikes the Secretary's authority to 
take any action necessary in order to ensure an orderly 
transition to the Direct Loan Program.
    Section 4002(c)(5) strikes the reporting requirement with 
respect to the progress of the transition to direct lending and 
simply requires a report on the integrity and administration of 
the programs under this part and part D.
    Section 4002(c)(6) strikes references to the transition 
from loan programs under this title to direct student loan 
programs under part D.
    Section 4002(c)(7) strikes reference to transition.
    Section 4002(c)(8) strikes all references to during the 
transition.
    Section 4002(c)(9) replace transition selection criteria 
with institution selection criteria.
    Section 4002(c)(10) strikes the requirement for the 
Secretary to publish regulations for institutional approval for 
the Direct Loan Program for academic years after 1995-96.
    Section 4002(c)(11) strikes the Secretary's authority to 
contract for services necessary for the orderly transition to 
the Direct Loan Program.
    Section 4002(d)(1) allows Direct Loan Program borrowers to 
obtain consolidation loans under part B.
    Section 4002(d)(2) strikes the provision allowing a part B 
borrower to obtain a Federal direct consolidation loan.
    Section 4003 eliminates the grace period interest subsidy 
for loans made on or after January 1, 1996 and allows the 
borrower to pay the interest monthly or quarterly or have it 
added to the principal upon commencement of repayment.
    Section 4004(a) establishes annual borrowing limits for 
borrowers of PLUS loans at $15,000 per student in any academic 
year.
    Section 4004(b) requires holders of PLUS Program loans to 
pay a rebate to the Secretary equal to 0.80 percent of the 
outstanding principal balance of loans held on June 30 and 
December 31, payable within 60 days after such date.
    Section 4004(c) provides for an increase in PLUS Program 
loan interest rates from the 52-week Treasury bill plus 3.1 to 
the 52- week Treasury bill plus 4 capped at 11 percent, for 
loans with a first disbursement after January 1, 1996.
    Section 4005 requires a lender or holder which purchases or 
takes assignment of a loan from another lender or holder to pay 
the Secretary a transfer fee equal to 0.20 percent of the 
principal of the loan.
    Section 4006 amends section 428(f) of the Higher Education 
Act to require originating lenders to pay to the guaranty 
agency which guarantees a loan, a fee equal to 0.70 percent of 
the principal amount of the loan for loans having a first 
disbursement after January 1, 1996. These funds shall be used 
by guaranty agencies for administrative costs of collections, 
preclaim assistance, monitoring enrollment and other program 
costs. No part of these payments may be assessed or collected 
directly or indirectly from the borrower.
    Section 4007(a) clarifies that non-Federal funds maintained 
in a guaranty agency's reserve fund are the property of the 
guaranty agency. In addition, the Secretary is not authorized 
to use returned funds for the operation of the Direct Loan 
Program. Funds recovered under this section shall be deposited 
with the Treasury for purposes of reducing the Federal debt. 
Guaranty agencies are required to maintain a minimum reserve 
level equal to .9 percent of outstanding loans guaranteed.
    Section 4007(b) allows for one form to be used for purposes 
of determining student need and eligibility, including 
assistance under part B. Electronic forms may be used subject 
to the approval of the Secretary and no fee may be charged in 
connection with its use.
    Section 4007(c) expands lender eligibility.
    Section 4007(d) makes the following program changes: lender 
insurance is reduced to 95 percent; guaranty agency reinsurance 
percentages are reduced to 96/86/76 and payment for 
supplemental preclaim activities is eliminated. Lender of last 
resort provisions are modified to require applications to be 
processed within 15 days and borrowers are required to only 
obtain one lender rejection in order to establish eligibility 
for lender of last resort.
    Section 4007(e) reduced the reinsurance and insurance for 
parties qualified as exceptional performers to 95 percent.
    Section 4007(f) reduces loan fees from lenders paid to the 
Secretary to 0.30 percent of the principal loan amount for 
loans with a first disbursement made on or after January 1, 
1996.
    Section 4007(g) provides an exemption from certain audit 
requirements for lenders which make or hold less than $5 
million in student loans in any fiscal year.
    Section 4008 requires guaranty agencies to use not less 
than 50 percent of their reserve funds for the purpose of 
purchasing and holding loans for which a claim for insurance is 
filed after the date of enactment of this subsection. This 
requirement shall not be applicable under certain conditions 
which are: (A) the dollar value of insurance claims does not 
amount to 50 percent; (B) State law prohibits such use; or (C) 
a guaranty agency's ability to pay program expenses would be 
compromised.
    Section 4009(a) establishes an extended holding period 
during which time guaranty agencies are to attempt to establish 
repayment with a borrower who has defaulted in order for the 
loan to be purchased by an eligible lender.
    Section 4009(b) creates a new section which establishes new 
deadlines for filing for reinsurance from the Secretary when a 
loan goes into default. Claims for reimbursement from the 
Secretary may not be filed prior to 180 days after the guaranty 
agency has paid the lender. Claims for reinsurance must be 
filed by 225 days. Guaranty agencies do not have to wait 180 
days to file for reinsurance if (1) they have already used 50 
percent or more of their reserves to purchase and hold loans; 
(2) they certify that diligent efforts to locate the borrower 
have been attempted but unsuccessful; or (3) the borrower is 
unlikely to possess the financial resources to begin repaying 
prior to 180 days.
    Section 4009(c) provides that during the 180 days after 
purchasing the loan from a lender, a guaranty agency shall 
attempt to bring the loan into repayment so that no claim for 
reimbursement by the Secretary will be necessary.
    Section 4009(d) prohibits the Secretary from regulating 
collection activities on loans purchased by guaranty agencies 
for which reinsurance has not been paid.
    Section 4010--College Construction Loan Insurance 
Association.
    Section 4010(a) provides for the repeal of the existing 
part D of title VII of the Higher Education Act which 
originally created the College Construction Loan Insurance 
Association.
    Section 4010(b)(1) provides that the Corporation is not an 
agency, instrumentality or establishment of the U.S. 
Government, nor a Government corporation or Government 
controlled corporation. In addition, no action shall be 
allowable against the United States based on actions of the 
Corporation.
    Section 4010(b)(2) states that the Corporation may engage 
in any business or activities for which corporations may be 
organized under the laws of any State or the District of 
Columbia.
    Section 4010(b)(3) provides that no stock of the 
Corporation may be sold or issued to an agency, 
instrumentality, or establishment of the U.S. Government, to a 
Government Corporation or to a Government sponsored enterprise. 
Section 4010(b)(3) further provides that the Student Loan 
Marketing Association shall not own any stock of the 
Corporation, except that it may retain the stock it owns on the 
date of enactment, that the Student Loan Marketing Association 
shall not control the operation of the Corporation except that 
it may continue to participate in the election of directors as 
a shareholder and that it may continue to appoint directors 
under Section 754 of the Higher Education Act of 1965 as long 
as that section is in effect, and that the Student Loan 
Marketing Association shall not provide financial support or 
guarantees to the Corporation. Notwithstanding the prohibitions 
in this subsection, the United States may pursue any remedy 
against holders of the Corporation's stock to which it would be 
otherwise entitled.
    Section 4010(c)(1) requires the Corporation to disclose 
that it is not a Government-sponsored enterprise and that its 
obligations are not guaranteed by the full faith and credit of 
the United States in all securities offerings and contracts for 
insurance, guarantee, or reinsurance of obligations for 5 years 
after date of enactment.
    Section 4010(c)(2) requires the Corporation to amend its 
charter to conform to this act.
    Section 4010(c)(3) prohibits the Corporation from using the 
term ``College Construction Loan Insurance Association'' in its 
name.
    Section 4010(c)(4) requires the Corporation to amend its 
articles of incorporation to reflect as one of its purposes, to 
guarantee, insure and reinsure bonds, leases and other 
evidences of debt of educational institutions, including 
historically black colleges and universities which are ranked 
in the lower investment grade category.
    Section 4010(c)(5)(A) retains section 754 of the Higher 
Education Act to remain in effect until all the stock of the 
Secretary of Education has been sold. This continues the right 
of the Secretary of Education and the Secretary of Treasury to 
appoint directors to the Corporation's board.
    Section 4010(c)(5)(B) requires the Corporation to report to 
the Secretary of Education for 2 years after the sale of the 
stock with respect to financing activities of the Corporation 
in financing education facilities projects.
    Section 4010(d)(1) requires the Treasury to sell the stock 
of the Corporation owned by the Department of Education not 
later than 6 months after enactment.
    Section 4010(d)(2) requires the Corporation, within the 
time frame set forth in paragraph (1), to purchase the stock if 
the Secretary of the Treasury is otherwise unable to sell. The 
price is to be determined by the Secretary of the Treasury and 
acceptable to the Corporation based on independent appraisal by 
a nationally recognized financial firm, except that such price 
shall not exceed the value of the Secretary's stock as 
determined by the Congressional Budget Office in House Report 
104-153.
    Section 4010(e) requires the Corporation to assist the 
Secretary of the Treasury and the Secretary of Education to 
facilitate the sale of the stock.
    Section 4010(f) defines the term ``Corporation'' to mean 
the Corporation established under the provision of law repealed 
by subsection (a).
    Section 4011--Eligible Institution.
    Section 4011(a) amends the Higher Education Act by 
requiring that, for the purposes of determining whether an 
institution meets the requirements of clause (6) (commonly 
referred to as the 85/15 rule), the Secretary of Education 
shall count revenues from programs of education or training 
that do not meet the definition of an eligible program in 
subsection (e), but are provided on a contractual basis under 
Federal, State, or local training programs, or to business or 
industry. Section 4011(a) further requires that the Secretary 
shall not consider the financial information of any institution 
for a fiscal year which began on or before April 30, 1994.
    Section 4011(b) makes this provision effective beginning 
July 1, 1994.
    Section 4012 extends Sections 424(a), 428(a)(5) and 428C(e) 
through 2002.
    Section 4101(a) repeals the Davis-Bacon Act.
    Section 4101(b) states any reference in any other law to a 
Davis- Bacon wage requirement shall be null and void 45 days 
after the date of enactment of this act.
    Section 4101(c) states these amendments shall take effect 
45 days after the date of enactment, but shall not affect any 
contract in existence prior to 45 days after enactment or made 
pursuant to invitation for bids prior to 45 days after the 
enactment of this act.
    Section 4102(a) repeals the Service Contract Act of 1965.
    Section 4102(b) states that the amendment made by this act 
shall not apply to contracts entered into prior to the 45th day 
after the date of enactment of this act.
    Section 4201 permits for purposes of section 205(c)(3)(A) 
of the Employee Retirement Income Security Act of 1974 [ERISA], 
the minimum period prescribed by the Secretary of the Treasury 
between the date that the explanation referred to in such 
section is provided and the annuity starting date shall not 
apply if waived by the participant and, if applicable, the 
participant's spouse. The provision is to apply to plan years 
beginning after December 31, 1995.

   Changes in Existing Law Made by Title IV of the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                      HIGHER EDUCATION ACT OF 1965

          * * * * * * *

                      TITLE IV--STUDENT ASSISTANCE

  Part A--Grants to Students in Attendance at Institutions of Higher 
                               Education

          * * * * * * *

             Part B--Federal Family Education Loan Program

          * * * * * * *

SEC. 422. ADVANCES FOR RESERVE FUNDS OF STATE AND NONPROFIT PRIVATE 
                    LOAN INSURANCE PROGRAMS.

  (a) Purpose of and Authority for Advances to Reserve Funds.--
          (1) * * *
          (2) Matching requirement.--No advance shall be made 
        after June 30, 1968, unless matched by an equal amount 
        from non-Federal sources. Such equal amount may include 
        the unencumbered non-Federal portion of a reserve fund. 
        As used in the preceding sentence, the term 
        ``unencumbered non-Federal portion'' means the amount 
        (determined as of the time immediately preceding the 
        making of the advance) of the reserve fund less the 
        greater of--
                  (A) * * *
          * * * * * * *
        [Except as provided in section 428(c)(10)(E) or (F), 
        such unencumbered] Such non-Federal portion shall not 
        be subject to recall, repayment, or recovery by the 
        Secretary.
          * * * * * * *
  (c) Advances for Insurance Obligations.--
          (1) * * *
          * * * * * * *
          (7) Emergency advances.--The Secretary is authorized 
        to make advances, on terms and conditions satisfactory 
        to the Secretary, to a guaranty agency--
                  (A) in accordance with section 428(j), in 
                order to ensure that the guaranty agency shall 
                make loans as the lender-of-last-resort [during 
                the transition from the Federal Family 
                Education Loan Program under this part to the 
                Federal Direct Student Loan Program under part 
                D of this title]; or
                  (B) if the Secretary is seeking to terminate 
                the guaranty agency's agreement, or assuming 
                the guaranty agency's functions, in accordance 
                with [section 428(c)(10)(F)(v)] section 
                428(c)(9)(F)(v), in order to assist the agency 
                in meeting its immediate cash needs, ensure the 
                uninterrupted payment of claims, or ensure that 
                the guaranty agency shall make loans as 
                described in subparagraph (A).
          * * * * * * *
  (g) Preservation and Recovery of Guaranty Agency Reserves.--
          (1) Authority to recover funds.--Notwithstanding any 
        other provision of law, the reserve funds of the 
        guaranty agencies, and any assets purchased with such 
        reserve funds, regardless of who holds or controls the 
        reserves or assets, shall be considered to be the 
        property of the United States to be used in the 
        operation of the program authorized by this part [or 
        the program authorized by part D of this title]. 
        However, the Secretary may not require the return of 
        all reserve funds of a guaranty agency to the Secretary 
        unless the Secretary determines that such return is in 
        the best interest of the operation of the program 
        authorized by this part [or the program authorized by 
        part D of this title], or to ensure the proper 
        maintenance of such agency's funds or assets or the 
        orderly termination of the guaranty agency's operations 
        and the liquidation of its assets. The reserves shall 
        be maintained by each guaranty agency to pay program 
        expenses and contingent liabilities, as authorized by 
        the Secretary, except that--
                  (A) * * *
          * * * * * * *
                  (D) any such determination under subparagraph 
                [(A) or (B)] (A), (B), or (C) shall be based on 
                standards prescribed by regulations that are 
                developed through negotiated rulemaking and 
                that include procedures for administrative due 
                process.
          * * * * * * *
          [(4) Availability of funds.--Any funds that are 
        returned or otherwise recovered by the Secretary 
        pursuant to this subsection shall be available for 
        expenditure for expenses pursuant to section 458 of 
        this Act.]
          (4) Disposition of funds returned to or recovered by 
        the secretary.--Any funds that are returned to or 
        otherwise recovered by the Secretary pursuant to this 
        subsection shall be returned to the Treasury of the 
        United States for purposes of reducing the Federal debt 
        and shall be deposited into the special account under 
        section 3113(d) of title 31, United States Code.
  (h) Use of Reserve Funds to Purchase Defaulted Loans.--
          (1) In general.--Except as provided in paragraph (2), 
        a guaranty agency shall use not less than 50 percent of 
        such agency's reserve funds to purchase and hold 
        defaulted loans that are guaranteed by such agency and 
        for which a claim for insurance is filed with such 
        agency by an eligible lender after the date of 
        enactment of this subsection. The amount of such 
        purchases shall be considered as reserve funds under 
        this section and used in the calculation of the minimum 
        reserve level under section 428(c)(9).
          (2) Special rule.--A guaranty agency shall not be 
        required to use its reserve funds to purchase and hold 
        defaulted loans in accordance with paragraph (1) to the 
        extent that--
                  (A) the dollar volume of insurance claims 
                filed with such agency does not amount to 50 
                percent of such agency's available reserve 
                funds; or
                  (B) such use is prohibited by State law; or
                  (C) such use will compromise the ability of 
                the guaranty agency to pay program expenses.
          * * * * * * *

SEC. 424. SCOPE AND DURATION OF FEDERAL LOAN INSURANCE PROGRAM.

  (a) Limitations on Amounts of Loans Covered by Federal 
Insurance.--The total principal amount of new loans made and 
installments paid pursuant to lines of credit (as defined in 
section 435) to students covered by Federal loan insurance 
under this part shall not exceed $2,000,000,000 for the period 
from July 1, 1976, to September 30, 1976, and for each of the 
succeeding fiscal years ending prior to October 1, [1998] 2002. 
Thereafter, Federal loan insurance pursuant to this part may be 
granted only for loans made (or for loan installments paid 
pursuant to lines of credit) to enable students, who have 
obtained prior loans insured under this part, to continue or 
complete their educational program; but no insurance may be 
granted for any loan made or installment paid after September 
30, 2002.
          * * * * * * *

SEC. 427A. APPLICABLE INTEREST RATES.

  (a) * * *
          * * * * * * *
  (c) Rates for Supplemental Loans for Students and Loans for 
Parents.--
          (1) * * *
          * * * * * * *
          (4) Availability of variable rates.--(A) * * *
          * * * * * * *
          (F) Notwithstanding subparagraphs (A), (D), and (E), 
        for any loan made pursuant to section 428B for which 
        the first disbursement is made on or after January 1, 
        1996--
                  (i) subparagraph (B) shall be applied by 
                substituting ``4.0'' for ``3.25''; and
                  (ii) the interest rate shall not exceed 11 
                percent.
          * * * * * * *
  (h) Interest Rates for New Loans After July 1, 1998.--
          (1) * * *
          [(2) Interest rates for new plus loans after july 1, 
        1998.--Notwithstanding subsections (a), (b), (d), (e), 
        (f), and (g), with respect to any loan made under 
        section 428B for which the first disbursement is made 
        on or after July 1, 1998, paragraph (1) shall be 
        applied--
                  [(A) by substituting ``2.1 percent'' for 
                ``1.0 percent'' in subparagraph (B); and
                  [(B) by substituting ``9.0 percent'' for 
                ``8.25 percent'' in the matter following such 
                subparagraph.]
          [(3)] (2) Consultation.--The Secretary shall 
        determine the applicable rate of interest under this 
        subsection after consultation with the Secretary of the 
        Treasury and shall publish such rate in the Federal 
        Register as soon as practicable after the date of 
        determination.
          * * * * * * *

SEC. 428. FEDERAL PAYMENTS TO REDUCE STUDENT INTEREST COSTS.

  (a) Federal Interest Subsidies.--
          (1) * * *
          * * * * * * *
          (3) Amount of interest subsidy.--(A) * * *
          * * * * * * *
          (C) Notwithstanding subparagraph (A), no portion of 
        the interest which accrues after the student ceases to 
        carry at an eligible institution at least one-half the 
        normal full-time academic workload (as determined by 
        the institution) and prior to the beginning of the 
        repayment period of the loan shall be paid by the 
        Secretary under this subsection on any loan made on or 
        after January 1, 1996. Interest on the unpaid principal 
        amount of any such loan during the interval described 
        in the preceding sentence shall, at the option of the 
        borrower--
                  (i) be paid monthly or quarterly, or
                  (ii) be added by the lender to the principal 
                amount of the loan at the commencement of the 
                repayment period.
          * * * * * * *
          (5) Duration of authority to make interest subsidized 
        loans.--The period referred to in subparagraph (B) of 
        paragraph (1) of this subsection shall begin on the 
        date of enactment of this Act and end at the close of 
        September 30, [1998] 2002, except that, in the case of 
        a loan made or insured under a student loan or loan 
        insurance program to enable a student who has obtained 
        a prior loan made or insured under such program to 
        continue his or her education program, such period 
        shall end at the close of September 30, [2002] 2006.
          * * * * * * *
  (b) Insurance Program Agreements To Qualify Loans for 
Interest Subsidies.--
          (1) Requirements of insurance program.--Any State or 
        any nonprofit private institution or organization may 
        enter into an agreement with the Secretary for the 
        purpose of entitling students who receive loans which 
        are insured under a student loan insurance program of 
        that State, institution, or organization to have made 
        on their behalf the payments provided for in subsection 
        (a) if the Secretary determines that the student loan 
        insurance program--
                  (A) * * *
          * * * * * * *
                  (G) insures not less than [98] 95 percent of 
                the unpaid principal of loans insured under the 
                program, except that such program shall insure 
                100 percent of the unpaid principal of loans 
                made with funds advanced pursuant to section 
                428(j) or 439(q);
          * * * * * * *
                  (U) provides (i) for the eligibility of all 
                lenders described in section 435(d)(1) under 
                reasonable criteria, unless (I) that lender is 
                eliminated as a lender under regulations for 
                the emergency action, limitation, suspension, 
                or termination of a lender under the Federal 
                student loan insurance program or is eliminated 
                as a lender pursuant to criteria issued under 
                the student loan insurance program which are 
                substantially the same as regulations with 
                respect to such eligibility as a lender issued 
                under the Federal student loan insurance 
                program, or (II) there is a State 
                constitutional prohibition affecting the 
                eligibility of a lender, (ii) assurances that 
                the guaranty agency will report to the 
                Secretary concerning changes in such criteria, 
                including any procedures in effect under such 
                program to take emergency action, limit, 
                suspend, or terminate lenders, and (iii) in the 
                case of any lender that originates or holds 
                more than $5,000,000 in principal on loans made 
                under this title in any fiscal year, for (I) a 
                compliance audit of each such lender at least 
                once a year and covering the period since the 
                most recent audit, conducted by a qualified, 
                independent organization or person in 
                accordance with standards established by the 
                Comptroller General for the audit of 
                governmental organizations, programs, and 
                functions, and as prescribed in regulations of 
                the Secretary, the results of which shall be 
                submitted to the Secretary, or (II) with regard 
                to such a lender that is audited under chapter 
                75 of title 31, United States Code, such audit 
                shall be deemed to satisfy the requirements of 
                subclause (I) for the period covered by such 
                audit, except that the Secretary may waive the 
                requirements of this clause (iii) [if the 
                lender] if such lender submits to the Secretary 
                the results of an audit conducted for other 
                purposes that the Secretary determines provides 
                the same information as the audits required by 
                this clause;
          * * * * * * *
                  (X) provides information to the Secretary in 
                accordance with [section 428(c)(10)] section 
                428(c)(9) and maintains reserve funds 
                determined by the Secretary to be sufficient in 
                relation to such agency's guarantee 
                obligations.
          (2) Contents of insurance program agreement.--Such an 
        agreement shall--
                  (A) * * *
          * * * * * * *
                  (E)(i) provide that any guaranty agency may 
                transfer loans which are insured under this 
                part to any other guaranty agency with the 
                approval of the holder of the loan and such 
                other guaranty agency; and
                  (ii) provide that the lender (or the holder 
                of the loan) shall, not later than 120 days 
                after the borrower has left the eligible 
                institution, notify the borrower of the date on 
                which the repayment period begins; [and]
                  (F) provide that, if the sale, other 
                transfer, or assignment of a loan made under 
                this part to another holder will result in a 
                change in the identity of the party to whom the 
                borrower must send subsequent payments or 
                direct any communications concerning the loans, 
                then--
                          (i) * * *
          * * * * * * *
                except that this subparagraph (F) shall only 
                apply if the borrower is in the grace period 
                described in section 427(a)(2)(B) or 428(b)(7) 
                or is in repayment status[.]; and
                  (G) provide that, if a lender or holder, on 
                or after January 1, 1996, sells, transfers, or 
                assigns a loan under this part, then the 
                transferee shall pay to the Secretary a 
                transfer fee in an amount equal to 0.20 percent 
                of the principal of the loan, which transfer 
                fee shall be deposited into the insurance fund 
                established in section 431, except that the 
                provisions of this subparagraph shall not apply 
                to any such sale, transfer, or assignment by a 
                lender or holder to such lender's or holder's 
                affiliate or pursuant to a merger or other 
                consolidation transaction.
          * * * * * * *
  (c) Guaranty Agreements for Reimbursing Losses.--
          (1) Authority to enter into agreements.--(A) The 
        Secretary may enter into a guaranty agreement with any 
        guaranty agency, whereby the Secretary shall undertake 
        to reimburse it, under such terms and conditions as the 
        Secretary may establish, with respect to losses 
        (resulting from the default of the student borrower) on 
        the unpaid balance of the principal and accrued 
        interest of any insured loan. The guaranty agency 
        shall, be deemed to have a contractual right against 
        the United States, during the life of such loan, to 
        receive reimbursement according to the provisions of 
        this subsection. Upon receipt of an accurate and 
        complete request by a guaranty agency for reimbursement 
        with respect to such losses, the Secretary shall pay 
        promptly and without administrative delay. Except as 
        provided in subparagraph (B) of this paragraph and in 
        paragraph (7), the amount to be paid a guaranty agency 
        as reimbursement under this subsection shall be equal 
        to [98] 96 percent of the amount expended by it in 
        discharge of its insurance obligation incurred under 
        its loan insurance program. [A guaranty agency] Except 
        as provided in section 428K, a guaranty agency shall 
        file a claim for reimbursement with respect to losses 
        under this subsection within 45 days after the guaranty 
        agency discharges its insurance obligation on the loan.
          (B) Notwithstanding subparagraph (A)--
                  (i) if, for any fiscal year, the amount of 
                such reimbursement payments by the Secretary 
                under this subsection exceeds 5 percent of the 
                loans which are insured by such guaranty agency 
                under such program and which were in repayment 
                at the end of the preceding fiscal year, the 
                amount to be paid as reimbursement under this 
                subsection for such excess shall be equal to 
                [88] 86 percent of the amount of such excess; 
                and
                  (ii) if, for any fiscal year, the amount of 
                such reimbursement payments exceeds 9 percent 
                of such loans, the amount to be paid as 
                reimbursement under this subsection for such 
                excess shall be equal to [78] 76 percent of the 
                amount of such excess.
          * * * * * * *
          (8) Assignment to protect federal fiscal interest.--
        (A) If the Secretary determines that the protection of 
        the Federal fiscal interest so requires, a guaranty 
        agency shall assign to the Secretary any loan of which 
        it is the holder and for which the Secretary has made a 
        payment pursuant to paragraph (1) of this subsection.
          [(B) An orderly transition from the Federal Family 
        Education Loan Program under this part to the Federal 
        Direct Student Loan Program under part D of this title 
        shall be deemed to be in the Federal fiscal interest, 
        and a guaranty agency shall promptly assign loans to 
        the Secretary under this paragraph upon the Secretary's 
        request.]
          (B) Prior to making such determination for any 
        guaranty agency, the Secretary shall, in consultation 
        with the guaranty agency, develop criteria to determine 
        whether such guaranty agency has made adequate 
        collection efforts. In determining whether a guaranty 
        agency's collection efforts have met such criteria, the 
        Secretary shall consider the agency's record of success 
        in collecting on defaulted loans, the age of the loans, 
        and the amount of recent payments received on the 
        loans.
          (9) Guaranty agency reserve level.--(A) Each guaranty 
        agency which has entered into an agreement with the 
        Secretary pursuant to this subsection shall maintain a 
        current minimum reserve level of at least .5 percent of 
        the total attributable amount of all outstanding loans 
        guaranteed by such agency for the fiscal year of the 
        agency that begins in 1993. For purposes of this 
        paragraph, such total attributable amount does not 
        include amounts of outstanding loans transferred to the 
        guaranty agency from another guaranty agency pursuant 
        to a plan of the Secretary in response to the 
        insolvency of the latter such guaranty agency. The 
        minimum reserve level shall increase to--
                  (i) .7 percent of such total attributable 
                amount for the fiscal year of the agency that 
                begins in 1994; and
                  (ii) .9 percent of such total attributable 
                amount for the fiscal year of the agency that 
                begins in 1995[; and].
                  [(iii) 1.1 percent of such total attributable 
                amount for each fiscal year of the agency that 
                begins on or after January 1, 1996.]
          * * * * * * *
          (C) If (i) any guaranty agency falls below the 
        required minimum reserve level in any 2 consecutive 
        years, (ii) any guaranty agency's Federal reimbursement 
        payments are reduced to [80] 76 percent pursuant to 
        section 428(c)(1)(B)(ii), or (iii) the Secretary 
        determines that the administrative or financial 
        condition of a guaranty agency jeopardizes such 
        agency's continued ability to perform its 
        responsibilities under its guaranty agreement, then the 
        Secretary shall require, as appropriate, the guaranty 
        agency to submit and implement a management plan 
        acceptable to the Secretary within 30 working days of 
        any such event.
          * * * * * * *
          (E) The Secretary may terminate a guaranty agency's 
        agreement in accordance with subparagraph (F) if--
                  (i) * * *
          * * * * * * *
                  (iv) the Secretary determines that such 
                action is necessary to protect the Federal 
                fiscal interest; or
                  (v) the Secretary determines that such action 
                is necessary to ensure the continued 
                availability of loans to student or parent 
                borrowers[; or].
                  [(vi) the Secretary determines that such 
                action is necessary to ensure an orderly 
                transition from the loan programs under this 
                part to the direct student loan programs under 
                part D of this title.]
          (F) If a guaranty agency's agreement under this 
        subsection is terminated pursuant to subparagraph (E), 
        then the Secretary shall assume responsibility for all 
        functions of the guaranty agency under the loan 
        insurance program of such agency. In performing such 
        functions the Secretary is authorized to--
                  (i) * * *
          * * * * * * *
                  (vii) take any other action the Secretary 
                determines necessary to ensure the continued 
                availability of loans made under this part to 
                residents of the State or States in which the 
                guaranty agency did business, the full honoring 
                of all guarantees issued by the guaranty agency 
                prior to the Secretary's assumption of the 
                functions of such agency, and the proper 
                servicing of loans guaranteed by the guaranty 
                agency prior to the Secretary's assumption of 
                the functions of such agency, and to avoid 
                disruption of the student loan program[, and to 
                ensure an orderly transition from the loan 
                programs under this part to the direct student 
                loan programs under part D of this title.].
          * * * * * * *
          (I) The Secretary shall not take any action under 
        subparagraph (E) or (F) without giving the guaranty 
        agency notice and the opportunity for a hearing on the 
        record.
          * * * * * * *
          (K) The Secretary, within 3 months after the end of 
        each fiscal year, shall submit to the House Committee 
        on Education and Labor and the Senate Committee on 
        Labor and Human Resources a report specifying the 
        Secretary's assessment of the fiscal soundness of the 
        guaranty agency system and [the progress of the 
        transition from the loan programs under this part to] 
        the integrity and administration of the direct student 
        loan programs under part D of this title.
          * * * * * * *
  (e) Payments for lender referral services.--
          (1) In general; agreements with guaranty agencies.--
        (A) The Secretary shall make payments in accordance 
        with this paragraph to a guaranty agency with which the 
        Secretary has an agreement under subparagraph (B) which 
        provides a lender referral service for students who 
        meet the requirements of paragraph (2).
          (B)(i) The Secretary may enter into agreements with 
        guaranty agencies that meet standards established by 
        the Secretary to provide lender referral services in 
        geographic areas specified by the Secretary. Such 
        guaranty agencies shall be paid in accordance with 
        paragraph (3) for such services.
          (ii) The Secretary shall publish in the Federal 
        Register whatever standards, criteria, and procedures, 
        consistent with the provisions of this part and part D 
        of this title, the Secretary determines are reasonable 
        and necessary to provide lender referral services under 
        this subsection and ensure loan access to student and 
        parent borrowers [during the transition from the loan 
        programs under this part to the direct student loan 
        programs under part D of this title]. Section 431 of 
        the General Education Provisions Act shall not apply to 
        the publication of such standards, criteria, and 
        procedures.
          * * * * * * *
          (3) Amount of payment.--From funds available for 
        costs [of transition] under section 458 of the Act, the 
        amount which the Secretary shall pay to any eligible 
        guaranty agency under this paragraph shall be equal to 
        one-half of 1 percent of the total principal amount of 
        the loans (upon which insurance was issued under this 
        part) to a student described in paragraph (2) who 
        subsequently obtained such loans because of such 
        agency's referral service.
          * * * * * * *
  [(f) Payments of Certain Costs.--
          [(1) Payments based on insurance program agreement.--
        (A) For a fiscal year prior to fiscal year 1994, the 
        Secretary shall make payments in accordance with the 
        provisions of this paragraph to any guaranty agency for 
        the purposes of--
                  [(i) the administrative cost of promotion of 
                eligible lender participation;
                  [(ii) the administrative costs of collection 
                of loans;
                  [(iii) the administrative costs of preclaims 
                assistance for default prevention;
                  [(iv) the administrative costs of monitoring 
                the enrollment and repayment status of 
                students; or
                  [(v) other such costs related to the student 
                loan insurance program subject to such 
                agreement.
          [(B) The total amount of payments for any fiscal year 
        prior to fiscal year 1994 made under this paragraph 
        shall be equal to 1 percent of the total principal 
        amount of the loans upon which insurance was issued 
        under this part during such fiscal year by such 
        guaranty agency. The guaranty agency shall, be deemed 
        to have a contractual right against the United States 
        to receive payments according to the provisions of this 
        subparagraph. Payments shall be made promptly and 
        without administrative delay to any guaranty agency 
        submitting an accurate and complete application 
        therefor under this subparagraph.
          [(C) No payment may be made under this paragraph for 
        loans for which the disbursement checks have not been 
        cashed or for which electronic funds transfers have not 
        been completed.
          [(2) Applications for payments.--No payment may be 
        made under paragraph (1) of this subsection unless the 
        guaranty agency submits to the Secretary an application 
        at such time, at least annually, in such manner, and 
        containing or accompanied by such information, as the 
        Secretary may reasonably require. Each such application 
        shall--
                  [(A) set forth assurances that the student 
                loan insurance program subject to the guaranty 
                agreement complies with subparagraphs (A), (B), 
                (G), (R), (S), (T), and (U) of subsection 
                (b)(1);
                  [(B) contain provisions designed to 
                demonstrate the capability of carrying out a 
                necessary and successful program of collection 
                of and preclaim assistance for the loan program 
                subject to that agreement;
                  [(C) set forth an estimate of the costs which 
                are eligible for payment under the provisions 
                of this subsection;
                  [(D) provide for such administrative and 
                fiscal procedures, including an audit, as are 
                necessary to carry out the provisions of this 
                subsection; and
                  [(E) set forth assurances that the guaranty 
                agency will furnish such data and information, 
                including where necessary estimates, as the 
                Secretary may reasonably require, to carry out 
                the provisions of this subsection.]
  (f) Payments of Certain Costs.--
          (1) Payments from lenders.--With respect to any loan 
        under this part for which the first disbursement is 
        made on or after January 1, 1996, the originating 
        lender shall remit to the guaranty agency which 
        guarantees the loan, a fee equal to 0.70 percent of the 
        principal amount of the loan.
          (2) Use of payments.--Payments made pursuant to 
        paragraph (1) shall be used for the purposes of--
                  (A) the administrative costs of collections 
                of loans;
                  (B) the administrative costs of preclaim 
                assistance and other predefault activities;
                  (C) the administrative costs of monitoring 
                the enrollment and repayment status of 
                students; and
                  (D) other such costs related to the student 
                loan insurance program.
          (3) Timing of payments.--Payments made pursuant to 
        paragraph (1) shall be made at the time insurance 
        premiums on such loans are paid to the guaranty agency.
          (4) Prohibition on pass-through.--No part of any 
        payments required by this section shall be assessed or 
        collected, directly or indirectly, from any borrower 
        under this part.
          * * * * * * *
  (j) Lenders-of-Last-Resort.--
          (1) * * *
          (2) Rules and operating procedures.--The guaranty 
        agency shall develop rules and operating procedures for 
        the lender-of-last-resort program designed to ensure 
        that--
                  (A) the program establishes operating hours 
                and methods of application designed to 
                facilitate application by students and ensure a 
                response within [60] 15 days after the 
                student's original complete application is 
                filed under this subsection;
                  (B) consistent with standards established by 
                the Secretary, students applying for loans 
                under this subsection shall not be subject to 
                additional eligibility requirements or requests 
                for additional information beyond what is 
                required under this title in order to receive a 
                loan under this part from an eligible lender, 
                nor be required to receive more than [two 
                rejections] one rejection from eligible lenders 
                in order to obtain a loan under this 
                subsection;
          * * * * * * *
          (3) Advances to guaranty agencies for lender-of-last-
        resort services [during transition to direct 
        lending].--(A) In order to ensure the availability of 
        loan capital [during the transition from the Federal 
        Family Education Loan Program under this part to the 
        Federal Direct Student Loan Program under part D of 
        this title,], the Secretary is authorized to provide a 
        guaranty agency with additional advance funds in 
        accordance with section 422(c)(7), with such 
        restrictions on the use of such funds as are determined 
        appropriate by the Secretary, in order to ensure that 
        the guaranty agency will make loans as the lender-of-
        last-resort. Such agency shall make such loans in 
        accordance with this subsection and the requirements of 
        the Secretary.
          * * * * * * *
  (l) Preclaims Assistance and Supplemental Preclaims 
Assistance.--
          [(1) Assistance required.--]Upon receipt of a proper 
        request from the lender, a guaranty agency having an 
        agreement with the Secretary under subsection (c) of 
        this section shall engage in preclaims assistance 
        activities (as described in subsection (c)(6)(C)(i)(I)) 
        and supplemental preclaims assistance activities (as 
        described in subsection (c)(6)(C)) with respect to each 
        loan covered by such agreement.
          [(2) Payments for supplemental preclaims 
        assistance.--The Secretary shall make payments in 
        accordance with the provisions of this paragraph to any 
        guaranty agency that engages in supplemental preclaims 
        assistance (as defined in subsection (c)(6)(C)) on a 
        loan guaranteed under this part. For each loan on which 
        such assistance is performed and for which a default 
        claim is not presented to the guaranty agency by the 
        lender on or before the 150th day after the loan 
        becomes 120 days delinquent, such payment shall be 
        equal to one percent of the total of the unpaid 
        principal and the accrued unpaid interest of the loan.]
          * * * * * * *

SEC. 428B. FEDERAL PLUS LOANS.

  (a) * * *
  [(b) Limitation based on need.--]
  (b) Annual Limits.--
          (1) Limitation based on need.--Any loan under this 
        section may be counted as part of the expected family 
        contribution in the determination of need under this 
        title, but no loan may be made to any parent under this 
        section for any academic year in excess of (A) the 
        student's estimated cost of attendance, minus (B) other 
        financial aid as certified by the eligible institution 
        under section 428(a)(2)(A).
          (2) Dollar limitation.--Subject to paragraph (1), the 
        maximum amount parents may borrow for one student in 
        any academic year or its equivalent (as defined by 
        regulations of the Secretary) is $15,000.
          (3) Limitation computed on basis of actual 
        payments.--The annual insurable limit on account of any 
        student shall not be deemed to be exceeded by a line of 
        credit under which actual payments to the borrower will 
        not be made in any year in excess of the annual limit.
          * * * * * * *
  (f) Interest Rebate.--
          (1) Rebate required.--Each holder of a loan under 
        this section made on or after the date of enactment of 
        the Omnibus Budget Reconciliation Act of 1995, shall 
        pay, on June 30 and December 31 of each year, to the 
        Secretary a rebate of subsidies in an amount equal to 
        0.8 percent of the outstanding principal balance of 
        loans held on such date. Payment of such rebate shall 
        be made not later than 60 days after each such date.
          (2) Deposit of rebates.--The Secretary shall deposit 
        all fees collected pursuant to paragraph (1) into the 
        insurance fund established in section 431.

SEC. 428C. FEDERAL CONSOLIDATION LOANS.

  (a) Agreements With Eligible Lenders.--
          (1) * * *
          * * * * * * *
          (4) Definition of eligible student loans.--For the 
        purpose of paragraph (1), the term ``eligible student 
        loans'' means loans--
                  (A) * * *
          * * * * * * *
                  (C) made under part D of this title;
                  [(C)] (D) made under subpart II of part A of 
                title VII of the Public Health Service Act; or
                  [(D)] (E) made under subpart II of part B of 
                title VIII of the Public Health Service Act.
  (b) Contents of Agreements, Certificates of Insurance, and 
Loan Notes.--
          (1) * * *
          * * * * * * *
          [(5) Direct loans.--In the event that a borrower is 
        unable to obtain a consolidation loan from a lender 
        with an agreement under subsection (a)(1), or is unable 
        to obtain a consolidation loan with income-sensitive 
        repayment terms acceptable to the borrower from such a 
        lender, the Secretary shall offer any such borrower who 
        applies for it, a direct consolidation loan. Such 
        direct consolidation loan shall, as requested by the 
        borrower, be repaid either pursuant to income 
        contingent repayment under part D of this title or 
        pursuant to any other repayment provision under this 
        section. The Secretary shall not offer such loans if, 
        in the Secretary's judgment, the Department of 
        Education does not have the necessary origination and 
        servicing arrangements in place for such loans.]
          * * * * * * *
  (e) Termination of Authority.--[The authority to make loans 
under this section expires at the close of September 30, 1998.] 
The authority to make loans under this section expires at the 
close of September 30, 2002. Nothing in this section shall be 
construed to authorize the Secretary to promulgate rules or 
regulations governing the terms or conditions of the agreements 
and certificates under subsection (b). Loans made under this 
section which are insured by the Secretary shall be considered 
to be new loans made to students for the purpose of section 
424(a).
          * * * * * * *

SEC. 428I. SPECIAL INSURANCE AND REINSURANCE RULES.

  (a) * * *
  (b) Payment to Lenders and Servicers.--
          (1) [100] 95 percent payment rule.--Each guaranty 
        agency shall pay each eligible lender or servicer (as 
        agent for an eligible lender) designated under 
        subsection (a) [100] 95 percent of the unpaid principal 
        and interest of all loans for which claims are 
        submitted for payment by that eligible lender or 
        servicer for the one-year period following the receipt 
        by the guaranty agency of the notification of 
        designation under this section or until the guaranty 
        agency receives notice from the Secretary that the 
        designation of the lender or servicer under subsection 
        (a) has been revoked.
          * * * * * * *

SEC. 428K. GUARANTOR PURCHASE OF CLAIMS WITH RESERVE FUNDS.

  (a) Loans Subject to Extended Holding Period.--Except as 
provided in subsection (b), a guaranty agency shall file a 
claim for reimbursement with respect to losses (resulting from 
the default of a student borrower) subject to reimbursement by 
the Secretary pursuant to section 428(c)(1) not less than 180 
days nor more than 225 days after the guaranty agency 
discharges such agency's insurance obligation on a loan insured 
under this part. Such claim shall include losses on the unpaid 
principal and accrued interest of any such loan, including 
interest accrued from the date of such discharge to the date 
such agency files the claim for reimbursement from the 
Secretary.
  (b) Loans Excluded From Extended Holding.--A guaranty agency 
may file a claim with respect to losses subject to 
reimbursement by the Secretary pursuant to section 428(c)(1) 
prior to 180 days after the date the guaranty agency discharges 
such agency's insurance obligation on a loan insured under this 
part, if--
          (1) such agency used 50 percent or more of such 
        agency's reserve funds to purchase or hold loans in 
        accordance with section 422(h);
          (2) such claim is based on an inability to locate the 
        borrower and the guaranty agency certifies to the 
        Secretary that--
                  (A) diligent attempts were made to locate the 
                borrower through the use of reasonable skip-
                tracing techniques in accordance with section 
                428(c)(2)(G); and
                  (B) such skip-tracing attempts to locate the 
                borrower were unsuccessful; or
          (3) the guaranty agency determines that the borrower 
        is unlikely to possess the financial resources to begin 
        repaying the loan prior to 180 days after default by 
        the borrower.
  (c) Guaranty Agency Efforts During Extended Holding Period.--
A guaranty agency shall attempt to bring a loan described in 
subsection (a) into repayment status prior to 180 days after 
the date the guaranty agency discharges its insurance 
obligation on the loan, so that no claim for reimbursement by 
the Secretary is necessary. Upon securing payment satisfactory 
to the guaranty agency during the 180-day period, such agency 
shall, if practicable, sell such loan to an eligible lender. 
Such loan shall not be sold to an eligible lender that the 
guaranty agency determines has substantially failed to exercise 
the due diligence required of lenders under this part.
  (d) Regulation Prohibited.--The Secretary shall not regulate 
the collection activities of a guaranty agency with respect to 
a loan described in subsection (a) for which reinsurance has 
not been paid under section 428(c)(1).
          * * * * * * *

SEC. 435. DEFINITIONS FOR STUDENT LOAN INSURANCE PROGRAM.

  As used in this part:
  (a) * * *
          * * * * * * *
  (d) Eligible Lender.--
          (1) In general.--Except as provided in paragraphs (2) 
        through (6), the term ``eligible lender'' means--
                  (A) a National or State chartered bank, a 
                mutual savings bank, a savings and loan 
                association, a stock savings bank, or a credit 
                union which--
                          (i) is subject to examination and 
                        supervision by an agency of the United 
                        States or of the State in which its 
                        principal place of operation is 
                        established, and
                          (ii) does not have as its primary 
                        consumer credit function the making or 
                        holding of loans made to students under 
                        this part unless (I) it is a bank which 
                        is wholly owned by a State, or a bank 
                        which is subject to examination and 
                        supervision by an agency of the United 
                        States, makes student loans as a 
                        trustee pursuant to an express trust, 
                        operated as a lender under this part 
                        prior to January 1, 1975, and which 
                        meets the requirements of this 
                        provision prior to the enactment of the 
                        Higher Education Amendments of 1992, or 
                        (II) it is a single wholly owned 
                        subsidiary of a bank holding company 
                        which does not have as its primary 
                        consumer credit function the making or 
                        holding of loans made to students under 
                        this part; and in determining whether 
                        the making or holding of loans to 
                        students and parents under this part is 
                        the primary consumer credit function of 
                        the eligible lender, loans made or held 
                        as trustee or in a trust capacity for 
                        the benefit of a third party shall not 
                        be considered;
          * * * * * * *
                  (I) a Rural Rehabilitation Corporation, or 
                its successor agency, which has received 
                Federal funds under Public Law 499, Eighty-
                first Congress (64 Stat. 98 (1950)); [and]
                  (J) for purpose of making loans under section 
                428C, any nonprofit private agency functioning 
                in any State as a secondary market[.]; and
                  (K) a wholly owned subsidiary of a publicly-
                held holding company which, as of the date of 
                enactment of this subparagraph, through one or 
                more subsidiaries (i) acts as a finance 
                company, and (ii) participates in the program 
                authorized by this part pursuant to 
                subparagraph (C).
          * * * * * * *

SEC. 438. SPECIAL ALLOWANCES.

  (a) * * *
          * * * * * * *
  (d) Loan Fees From Lenders.--
          (1) * * *
          [(2) Amount of loan fees.--With respect to any loan 
        under this part for which the first disbursement was 
        made on or after October 1, 1993, the amount of the 
        loan fee which shall be deducted under paragraph (1) 
        shall be equal to 0.50 percent of the principal amount 
        of the loan.]
          (2) Amount of loan fees.--The amount of the loan fee 
        which shall be deducted under paragraph (1) shall be--
                  (A) 0.50 percent of the principal amount of 
                the loan, for any loan under this part for 
                which the first disbursement was made on or 
                after October 1, 1993, and before January 1, 
                1996; or
                  (B) 0.30 percent of the principal amount of 
                the loan, for any loan under this part for 
                which the first disbursement was made on or 
                after January 1, 1996.
          * * * * * * *

          PART D--WILLIAM D. FORD FEDERAL DIRECT LOAN PROGRAM

SEC. 451. PROGRAM AUTHORITY.

  (a) In General.--There are hereby made available, in 
accordance with the provisions of this part, such sums as may 
be necessary to make loans to all eligible students (and the 
eligible parents of such students) in attendance at 
participating institutions of higher education selected by the 
Secretary, to enable such students to pursue their courses of 
study at such institutions during the period beginning July 1, 
1994 and ending June 30, 1996. Such loans shall be made by 
participating institutions, or consortia thereof, that have 
agreements with the Secretary to originate loans, or by 
alternative originators designated by the Secretary to make 
loans for students in attendance at participating institutions 
(and their parents).
          * * * * * * *

SEC. 452. FUNDS FOR ORIGINATION OF DIRECT STUDENT LOANS.

  (a) * * *
          * * * * * * *
  (e) Termination of Funding.--The Secretary shall not provide 
funds under this section for loans for any academic year 
beginning on or after July 1, 1996. The Secretary shall not pay 
any fees pursuant to subsection (b) of this section on or after 
January 1, 1996.

SEC. 453. SELECTION OF INSTITUTIONS FOR PARTICIPATION AND ORIGINATION.

  (a) Phase-In of Program.--
          (1) General authority.--The Secretary shall enter 
        into agreements pursuant to section 454(a) with 
        institutions of higher education to participate in the 
        direct student loan program under this part, and 
        agreements pursuant to section 454(b) with institutions 
        of higher education, or consortia thereof, to originate 
        loans in such program, for academic years beginning on 
        or after July 1, 1994 and ending before July 1, 1996. 
        Alternative origination services, through which an 
        entity other than the participating institution at 
        which the student is in attendance originates the loan, 
        shall be provided by the Secretary, through 1 or more 
        contracts under section 456(b) or such other means as 
        the Secretary may provide, for students attending 
        participating institutions that do not originate direct 
        student loans under this part. Such agreements for the 
        academic year 1994-1995 shall, to the extent feasible, 
        be entered into not later than January 1, 1994.
          (2) Transition provisions.--In order to ensure an 
        expeditious but orderly transition from the loan 
        programs under part B of this title to the direct 
        student loan program under this part, the Secretary 
        shall, in the exercise of the Secretary's discretion, 
        determine the number of institutions with which the 
        Secretary shall enter into agreements under subsections 
        (a) and (b) of section 454 for any academic year, 
        except that the Secretary shall exercise such 
        discretion so as to achieve the following goals:
                  (A) for academic year 1994-1995, loans made 
                under this part shall represent 5 percent of 
                the new student loan volume for such year; and
                  (B) for academic year 1995-1996, loans made 
                under this part shall represent 40 percent of 
                the new student loan volume for such year[;].
                  [(C) for academic years 1996-1997 and 1997-
                1998, loans made under this part shall 
                represent 50 percent of the new student loan 
                volume for such years; and
                  [(D) for the academic year that begins in 
                fiscal year 1998, loans made under this part 
                shall represent 60 percent of the new student 
                loan volume for such year.
          [(3) Exception.--The Secretary may exceed the 
        percentage goals described in subparagraphs (C) or (D) 
        of paragraph (2) if the Secretary determines that a 
        higher percentage is warranted by the number of 
        institutions of higher education that desire to 
        participate in the program under this part and that 
        meet the eligibility requirements for such 
        participation.]
          [(4)] (3) New student loan volume.--For the purpose 
        of this subsection, the term ``new student loan 
        volume'' means the estimated sum of all loans (other 
        than consolidation loans) that will be made, insured or 
        guaranteed under this part and part B in the year for 
        which the determination is made. The Secretary shall 
        base the estimate described in the preceding sentence 
        on the most recent program data available.
  (c) Selection Criteria for Origination.--
          (1) * * *
          (2) [Transition] Institutional selection criteria.--
        For academic year 1994-1995, the Secretary may approve 
        an institution to originate loans only if such 
        institution--
                  (A) * * *
          * * * * * * *
          [(3) Regulations governing approval after 
        transition.--For academic year 1995-1996 and subsequent 
        academic years, the Secretary shall promulgate and 
        publish in the Federal Register regulations governing 
        the approval of institutions to originate loans under 
        this part in accordance with section 457(a)(2).]
          * * * * * * *

SEC. 456. CONTRACTS.

  (a) * * *
  (b) Contracts for Origination, Servicing, and Data Systems.--
The Secretary may enter into contracts for--
          (1) * * *
          * * * * * * *
          (3) the establishment and operation of 1 or more data 
        systems for the maintenance of records on all loans 
        made under this part; and
          [(4) services to assist in the orderly transition 
        from the loan programs under part B to the direct 
        student loan program under this part; and]
          [(5)] (4) such other aspects of the direct student 
        loan program as the Secretary determines are necessary 
        to ensure the [successful operation] integrity and 
        efficiency of the program.
          * * * * * * *

SEC. 458. FUNDS FOR ADMINISTRATIVE EXPENSES.

  [(a) In General.--Each fiscal year, there shall be available 
to the Secretary of Education from funds available pursuant to 
section 422(g) and from funds not otherwise appropriated, funds 
to be obligated for administrative costs under this part, 
including the costs of the transition from the loan programs 
under part B to the direct student loan programs under this 
part (including the costs of annually assessing the program 
under this part and the progress of the transition) and 
transition support (including administrative costs) for the 
expenses of guaranty agencies in servicing outstanding loans in 
their portfolios and in guaranteeing new loans, not to exceed 
(from such funds not otherwise appropriated) $260,000,000 in 
fiscal year 1994, $284,000,000 in fiscal year 1995, 
$550,000,000 in fiscal year 1996, $595,000,000 in fiscal year 
1997, and $750,000,000 in fiscal year 1998. If in any fiscal 
year the Secretary determines that additional funds for 
administrative expenses are needed as a result of such 
transition or the expansion of the direct student loan programs 
under this part, the Secretary is authorized to use funds 
available under this section for a subsequent fiscal year for 
such expenses, except that the total expenditures by the 
Secretary (from such funds not otherwise appropriated) shall 
not exceed $2,439,000,000 in fiscal years 1994 through 1998. 
The Secretary is also authorized to carry over funds available 
under this section to a subsequent fiscal year.]
  (a) In General.--
          (1) Direct administrative costs.--Each fiscal year 
        there shall be available to the Secretary of Education, 
        from funds not otherwise appropriated, funds to be 
        obligated for the subsidy costs of direct 
        administrative costs under this part, subject to 
        subsection (b) of this section.
          (2) Indirect administrative costs.--There shall also 
        be available from funds available from funds not 
        otherwise appropriated, funds to be obligated for 
        indirect administrative costs under this part and part 
        B, subject to subsection (c) of this section, not to 
        exceed (from such funds not otherwise appropriated) 
        $260,000,000 in fiscal year 1994, $345,000,000 in 
        fiscal year 1995, $110,000,000 in fiscal year 1996 (of 
        which $40,000,000 shall be available for administrative 
        cost allowances for guaranty agencies for October 
        through December of 1995), and $70,000,000 in each of 
        the fiscal years 1997 through 2002.
          (3) Reduction.--The amount authorized to be made 
        available for fiscal year 1997 under paragraph (2) 
        shall be reduced by the amount of any unobligated 
        unexpended funds available to carry out this subsection 
        for any fiscal year prior to fiscal year 1996.
  (b) Subsidy Costs.--For purposes of this section, ``subsidy 
cost'' means the estimated long-term cost to the Federal 
Government of direct administrative expenses calculated on a 
net present value basis.
  (c) Direct Administrative Expenses.--For purposes of this 
section, ``direct administrative expenses'' shall consist of 
the cost of--
          (1) activities related to credit extension, loan 
        origination, loan servicing, management of contractors, 
        and payments to contractors, other government entities, 
        and program participants;
          (2) collection of delinquent loans; and
          (3) write-off and closeout of loans.
  (d) Indirect Administrative Expenses.--For purposes of this 
section, ``indirect administrative expenses'' shall consist of 
the cost of--
          (1) personnel engaged in developing program 
        regulations, policy, and administrative guidelines;
          (2) audits of institutions and contractors;
          (3) program reviews; and
          (4) other oversight of the program.
  (e) Limitation on Part D Expenditures.--For any fiscal year, 
expenditures for indirect administrative expenses and for loan 
servicing for loans made pursuant to this part shall not exceed 
30 percent of funds available pursuant to paragraph (2) for 
such fiscal year.
  [(b)] (f) Availability.--Funds made available under 
subsection (a) shall remain available until expended.
  [(c)] (g) Budget Justification.--No funds may be expended 
under this section unless the Secretary includes in the 
Department of Education's annual budget justification to 
Congress a detailed description of the specific activities for 
which the funds made available by this section have been used 
in the prior and current years (if applicable), the activities 
and costs planned for the budget year, and the projection of 
activities and costs for each remaining year for which 
administrative expenses under this section are made available.
  [(d) Notification.--In the event the Secretary finds it 
necessary to use the authority provided to the Secretary under 
subsection (a) to draw funds for administrative expenses from a 
future year's funds, no funds may be expended under this 
section unless the Secretary immediately notifies the 
Committees on Appropriations of the Senate and of the House of 
Representatives, and the Labor and Human Resources Committee of 
the Senate and the Education and Labor Committee of the House 
of Representatives, of such action and explain the reasons for 
such action.]
          * * * * * * *

   Part G--General Provisions Relating to Student Assistance Programs

SEC. 481. DEFINITIONS.

  (a) * * *
  (b) Proprietary Institution of Higher Education.--For the 
purpose of this section, the term ``proprietary institution of 
higher education'' means a school (1) which provides an 
eligible program of training to prepare students for gainful 
employment in a recognized occupation, (2) which meets the 
requirements of clauses (1) and (2) of section 1201(a), (3) 
which does not meet the requirement of clause (4) of section 
1201(a), (4) which is accredited by a nationally recognized 
accrediting agency or association approved by the Secretary 
pursuant to part H of this title, (5) which has been in 
existence for at least 2 years, and (6) which has at least 15 
percent of its revenues from sources that are not derived from 
funds provided under this title, as determined in accordance 
with regulations prescribed by the Secretary on the basis of a 
review by the institution's independent auditor using generally 
accepted accounting principles. For the purposes of clause (6), 
revenues from sources that are not derived from funds provided 
under this title include revenues from programs of education or 
training that do not meet the definition of an eligible program 
in subsection (e), but are provided on a contractual basis 
under Federal, State, or local training programs, or to 
business and industry. For the purposes of determining whether 
an institution meets the requirements of clause (6), the 
Secretary shall not consider the financial information of any 
institution for a fiscal year began on or before April 30, 
1994. Such term also includes a proprietary educational 
institution in any State which, in lieu of the requirement in 
clause (1) of section 1201(a), admits as regular students 
persons who are beyond the age of compulsory school attendance 
in the State in which the institution is located.
          * * * * * * *

SEC. 483. FORMS AND REGULATIONS.

  (a) Common Financial Aid Form and Processing.--
          (1) Single form required.--The Secretary, in 
        cooperation with representatives of agencies and 
        organizations involved in student financial assistance, 
        shall produce, distribute, and process free of charge a 
        common financial reporting form to be used to determine 
        the need and eligibility of a student for financial 
        assistance under parts A, B, C, D, and E of this title 
        (other than under subpart 4 of part A) [and to 
        determine the need of a student for the purpose of part 
        B of this title]. The Secretary may include on the form 
        developed pursuant to this paragraph not more than 
        eight nonfinancial data items selected in consultation 
        with the States to assist the States in awarding State 
        student financial assistance. Such form shall satisfy 
        the requirements of section 401(d) of this title. [For 
        the purpose of collecting eligibility and other data 
        for the purpose of part B, the Secretary shall develop 
        a separate, identifiable loan application document 
        (pursuant to section 432(m)) that applicants or 
        institutions in which the students are enrolled or 
        accepted for enrollment shall submit directly to 
        eligible lenders and on which the applicant shall 
        clearly indicate a choice of a lender.] Such form may 
        be in an electronic or any other format (subject to 
        section 485B) in order to facilitate use by borrowers 
        and institutions.
          * * * * * * *
          (3) Distribution of data.--Institutions of higher 
        education [and States shall receive,], any guaranty 
        agency authorized by any such institution, and States 
        shall receive, at their request and without charge, the 
        data collected by the Secretary using the form 
        developed pursuant to this section for the purposes of 
        determining need and eligibility for institutional and 
        State financial aid awards. Entities designated by 
        institutions of higher education or States to receive 
        such data shall be subject to all requirements of this 
        section, unless such requirements are waived by the 
        Secretary.
          * * * * * * *
          (5) Electronic forms.--(A) The Secretary, in 
        cooperation with representatives of institutions of 
        higher education, eligible lenders, and guaranty 
        agencies, shall prescribe an electronic version of the 
        form described in subsection (a)(1). Such electronic 
        form shall not require signatures to be collected at 
        the time such form is submitted if the data contained 
        in the electronic form is certified in one or more 
        separate writings. The Secretary shall prescribe the 
        initial electronic form not later than 90 days after 
        the date of enactment of this paragraph.
          (B) Nothing in this Act shall preclude the use of the 
        electronic form prescribed under subparagraph (A) 
        through software developed, produced, distributed 
        (including by diskette, modem or network communication, 
        or otherwise) or collected by eligible lenders, 
        guaranty agencies, eligible institutions, or consortia 
        thereof. Such organization or consortium shall submit 
        such electronic form to the Secretary for review prior 
        to its use. If such electronic form is inconsistent 
        with the provisions of this part, the Secretary shall 
        notify the submitting organization or consortium of his 
        objection within 30 days of such submission, and shall 
        specifically identify the necessary changes. In the 
        absence of such an objection the organization or 
        consortium may use the electronic form as submitted. No 
        fee may be charged in connection with use of the 
        electronic form, or of any other electronic forms used 
        in conjunction with such form in applying for Federal 
        or State student financial assistance.
          * * * * * * *

  TITLE VII--CONSTRUCTION, RECONSTRUCTION, AND RENOVATION OF ACADEMIC 
                               FACILITIES

          * * * * * * *

        [Part D--College Construction Loan Insurance Association

[SEC. 751. CONGRESSIONAL DECLARATION OF PURPOSE; DEFINITION; 
                    INCORPORATION.

  [(a) Purpose.--The Congress hereby declares that it is the 
purpose of this part to authorize participation of the United 
States Government and the Student Loan Marketing Association in 
a private, for profit corporation to be known as the College 
Construction Loan Insurance Association (hereinafter referred 
to as the ``Corporation'') which will, directly or indirectly, 
alone or in collaboration with others--
          [(1) guarantee, insure, and reinsure bonds, 
        debentures, notes, evidences of debt, loans, and 
        interests therein, the proceeds of which are to be used 
        for an education facilities purpose;
          [(2) guarantee and insure leases of personal, real, 
        or mixed property to be used for an education 
        facilities purpose; and
          [(3) issue letters of credit and undertake 
        obligations and commitments as the Corporation deems 
        necessary to carry out the purposes described in 
        paragraphs (1) and (2).
  [(b) Status as Non-Governmental Entity.--The Corporation 
shall not be an agency, instrumentality, or establishment of 
the United States Government and shall not be a ``Government 
corporation'' nor a ``Government controlled corporation'' as 
defined in section 103 of title 5, United States Code. No 
action under section 1491 of title 28, United States Code 
(commonly known as the Tucker Act) shall be allowable against 
the United States based on the actions of the Corporation.
  [(c) Corporate Powers and Limitations.--The Corporation shall 
be subject to the provisions of this part and, to the extent 
not inconsistent with this part, to the District of Columbia 
Business Corporation Act. The business activities of the 
Corporation shall always be limited to the purposes set forth 
in subsection (a) of this section. It shall have the powers 
conferred upon a corporation by the District of Columbia 
Business Corporation Act as from time to time in effect in 
order to conduct its corporate affairs and to carry out its 
purposes and activities incidental thereto.
  [(d) Definition of Education Facilities Purpose.--As used in 
this section, an ``education facilities purpose'' includes any 
activity (including activities related to the payment of 
financing or transaction costs) relating to the construction, 
reconstruction, renovation, acquisition, or purchase of (1) 
education, training, or research facilities or housing for 
students, faculty, or staff, (2) any underlying real property 
or any interest therein, (3) furniture, fixtures, and equipment 
to be used in connection with any education or training 
facility or housing for students, faculty, or staff, and (4) 
instructional equipment and research instrumentation including 
site preparation for such equipment and instrumentation.

[SEC. 752. CRITERIA FOR GUARANTEES AND INSURANCE.

  [(a) General Rule.--The Corporation shall provide direct 
insurance, guarantees, and reinsurance on obligations issued 
for education facilities purposes only in accordance with the 
requirements of this section.
  [(b) Allocation of Reinsurance Capacity.--
          [(1) At least the percentages specified in paragraph 
        (2) of the aggregate dollar amount of bond and 
        debenture issues reinsured by the Corporation shall be 
        issues which, without insurance, are listed by a 
        nationally recognized statistical rating organization 
        at a rating below the third highest rating of such 
        organization.
          [(2) For the purpose of paragraph (1) of this 
        subsection, the percentages specified in this paragraph 
        shall be--
                  [(A) 10 percent for the first full year of 
                operation of the Corporation;
                  [(B) 30 percent for the second full year of 
                such operation; and
                  [(C) 50 percent for the third full year of 
                such operation and thereafter.
          [(3) No bond or debenture issue which is both 
        reinsured and directly insured by the Corporation may 
        be counted toward the fulfillment of the requirements 
        of paragraph (1).
  [(c) Direct Insurance and Guarantee Activities; 
Limitations.--
          [(1) All of the assets and obligations directly 
        covered by primary insurance or guarantees issued by 
        the Corporation shall be assets or obligations of 
        institutions which are, without insurance or guarantee, 
        listed by a nationally recognized statistical rating 
        organization at a rating below the third highest rating 
        of such organization.
          [(2) At least the percentages specified in paragraph 
        (3) of the aggregate dollar amount of the assets and 
        obligations reinsured, insured, and guaranteed by the 
        Corporation under this section shall be in the direct 
        insurance and guarantee activities specified in this 
        subsection.
          [(3) For the purpose of paragraph (2) of this 
        paragraph, the percentages specified in this paragraph 
        shall be--
                  [(A) 10 percent for the first full year of 
                operation of the Corporation;
                  [(B) 30 percent for the second full year of 
                such operation; and
                  [(C) 50 percent for the third full year of 
                such operation and thereafter.
          [(4) For the purpose of paragraph (1), the assets and 
        obligations which may be directly covered by primary 
        insurance or guarantees issued by the Corporation are--
                  [(A) bonds, debentures, notes, evidences of 
                debt, loans, and interests therein, the 
                proceeds of which are to be used for an 
                education facilities purpose; and
                  [(B) leases of personal, real, or mixed 
                property to be used for an education facilities 
                purpose.
          [(5) Notwithstanding paragraph (1), the Corporation 
        may issue primary insurance or guarantees covering the 
        assets or obligations of institutions which are, 
        without insurance or guarantee, listed by a nationally 
        recognized statistical rating organization at or above 
        the third highest rating of such organization, subject 
        to all of the following conditions and limitations:
                  [(A) The proposed transaction shall have been 
                declined for coverage by all unaffiliated 
                monoline insurers that are authorized to write 
                financial guarantee insurance and that, in the 
                previous year, provided primary insurance or 
                guarantees on educational facility obligations. 
                The Secretary shall publish by January 31 of 
                each year a list of all such insurers.
                  [(B) Within 2 business days of receiving 
                complete documentation concerning a proposed 
                transaction by an institution seeking insurance 
                from the Corporation pursuant to this paragraph 
                (5), an insurer shall offer to provide coverage 
                or execute an affidavit of declination, or its 
                failure to respond shall be deemed a 
                declination. The institution seeking insurance 
                from the Corporation shall file with the 
                Corporation the affidavits from all declining 
                insurers, as well as an affidavit of the 
                institution's financial advisor specifically 
                identifying the pertinent terms of the proposed 
                transaction, the requested insurance coverage, 
                and the date on which complete documentation 
                concerning the proposed transaction was 
                submitted to each insurer and certifying that 
                such information was provided to each insurer 
                that declined coverage.
                  [(C) The proceeds of the assets or 
                obligations insured or guaranteed by the 
                Corporation pursuant to this paragraph shall be 
                used exclusively for the renovation, repair, 
                replacement, or construction of academic and 
                educational facilities and shall not be used 
                for the renovation, repair, replacement, or 
                construction of athletic facilities.
                  [(D) The aggregate par value of assets and 
                obligations insured or guaranteed by the 
                Corporation under this paragraph (5) shall not 
                exceed--
                          [(i) $100,000,000 per year during 
                        calendar years 1993, 1994, and 1995; or
                          [(ii) $150,000,000 per year during 
                        calendar years 1996 and 1997.
                  [(E) The aggregate dollar amount of 
                transactions under this paragraph (5) shall not 
                exceed--
                          [(i) in calendar year 1993, 1994, or 
                        1995, 10 percent of the aggregate 
                        dollar amount of assets and obligations 
                        directly covered by primary insurance 
                        or guarantees issued by the Corporation 
                        under this section in such year; or
                          [(ii) in calendar year 1996 or 1997, 
                        15 percent of the aggregate dollar 
                        amount of assets and obligations 
                        directly covered by primary insurance 
                        or guarantees issued by the Corporation 
                        under this section in such year.
  [(d) Notice of Services.--The Corporation shall take such 
steps as may be necessary to publicize the availability of its 
insurance and reinsurance programs under this section in a 
manner that assures that information concerning such programs 
will be available to each eligible institution.
  [(e) Nondiscrimination Required.--
          [(1) The Corporation may not carry out any activities 
        with respect to any educational facilities purpose of a 
        participating institution if the institution 
        discriminates on account of race, color, religion 
        (subject to paragraph (2)), national origin, sex (to 
        the extent provided in title IX of the Education 
        Amendments of 1972), or handicapping condition.
          [(2) The prohibition with respect to religion shall 
        not apply to an educational institution which is 
        controlled by or which is closely identified with the 
        tenets of a particular religious organization if the 
        application of this section would not be consistent 
        with the religious tenets of such organization.
          [(3) Each participating institution shall certify to 
        the Corporation that the institution does not 
        discriminate as required by the provisions of paragraph 
        (1).

[SEC. 753. PROCESS OF ORGANIZATION.

  [The Secretary of the Treasury, the Secretary, and the 
Student Loan Marketing Association shall each appoint 2 persons 
to be incorporators of the Corporation. If either the Secretary 
of the Treasury or the Secretary fail to appoint incorporators 
within 90 days after the date of enactment of the Higher 
Education Amendments of 1986, the Student Loan Marketing 
Association, after consultation with the Committee on Labor and 
Human Resources of the Senate and the Committee on Education 
and Labor of the House of Representatives, shall have the 
authority to name the incorporators which have not been so 
appointed. The incorporators so appointed shall each sign the 
articles of incorporation and shall serve as the initial Board 
of Directors until the members of the first regular Board of 
Directors shall have been appointed and elected. Such 
incorporators shall take whatever actions are necessary or 
appropriate to establish the Corporation, including the filing 
of articles of incorporation.

[SEC. 754. OPERATION AND ELECTION OF BOARD OF DIRECTORS.

  [(a) In General.--The Corporation shall have a Board of 
Directors which shall consist of 11 members, of whom one shall 
be elected annually by the Board to serve as chairman. 
Directors shall serve for terms of one year or until their 
successors have been appointed and qualified, and any member so 
appointed to fill a vacancy shall be appointed only for the 
unexpired term of the Director whom he succeeds. Two Directors 
shall be appointed by the Secretary of the Treasury; 2 
Directors shall be appointed by the Secretary; 3 Directors 
shall be appointed by the Student Loan Marketing Association; 
and the remaining 4 Directors shall be elected by the holders 
of the Corporation's voting common stock at least one of whom 
shall be a college or university administrator. The failure of 
the Secretary or the Secretary of the Treasury to make any one 
or more appointments to the Board of Directors of the 
Corporation shall not affect or diminish the right and power of 
(1) the other directors who have been appointed or elected to 
assume and carry out their duties as directors and (2) the 
Board so constituted to act for all purposes as the full Board 
of the Corporation.
  [(b) Cumulative Voting.--The articles of incorporation of the 
Corporation shall provide for cumulative voting under section 
27(d) of the District of Columbia Business Corporation Act 
(D.C. Code, sec. 29-327(d)).

[SEC. 755. INITIAL CAPITAL.

  [(a) Authority To Issue Common Stock.--The Corporation shall 
issue shares of voting common stock of no par value at such 
time within 6 months of its incorporation as shall be 
designated by the initial Board of Directors, and from time to 
time thereafter.
  [(b) Subscription by Secretary.--The Secretary is authorized 
and directed to subscribe to and purchase, in each of the 5 
years following the incorporation of the Corporation, voting 
common stock of the Corporation having an aggregate purchase 
price of not more than $20,000,000, subject to availability of 
appropriations.
  [(c) Subscription by Association.--The Student Loan Marketing 
Association is authorized to subscribe to and purchase during 
the 5 years following the incorporation of the Corporation 
voting common stock of the Corporation having an aggregate 
purchase price of $25,000,000 or more.
  [(d) Annual Issuance.--The Corporation is authorized to offer 
for subscription and purchase to the general public during the 
5 years following the incorporation of the Corporation, voting 
common stock having an aggregate purchase price of 
$125,000,000. Not less than 40 percent of such stock shall be 
set aside for purchase by institutions of higher education 
prior to being offered to the general public.

[SEC. 756. ISSUE OF NONVOTING STOCK AND DEBT TO THE PUBLIC.

  [The Corporation may issue, without limitation as to amount 
or restriction as to ownership, such nonvoting common, 
preferred, and preference stock, debt, and such other 
securities and obligations, in such amounts, at such times, and 
having such terms and conditions as may be deemed necessary or 
appropriate by its Board of Directors.

[SEC. 757. OBLIGATIONS NOT FEDERALLY GUARANTEED; NO FEDERAL PRIORITY.

  [No obligation which is insured, guaranteed, or otherwise 
backed by the Corporation, shall be deemed to be an obligation 
which is guaranteed by the full faith and credit of the United 
States. No obligation which is insured, guaranteed, or 
otherwise backed by the Corporation shall be deemed to be an 
obligation which is guaranteed by the Student Loan Marketing 
Association. This section shall not affect the determination of 
whether such obligation is guaranteed for purposes of Federal 
income taxes.

[SEC. 758. AUTHORITY OF SECRETARY TO SELL COMMON STOCK; RIGHT OF FIRST 
                    REFUSAL.

  [(a) Authority To Sell.--The Secretary may, at any time after 
a date which is 5 years after the date of incorporation of the 
Corporation, sell (in one or more transactions) the voting 
common stock of the Corporation owned by the Secretary. Prior 
to offering such common stock for sale to any other person, the 
Secretary shall offer such stock to the Student Loan Marketing 
Association at the price determined pursuant to subsection (b). 
Not later than 30 days prior to the sale of such stock, the 
Secretary shall advise, in writing, the Committee on Labor and 
Human Resources of the Senate and the Committee on Education 
and Labor of the House of Representatives of plans of the 
Secretary.
  [(b) Purchase Price.--The price at which the Secretary may 
sell the voting common stock of the Corporation under 
subsection (a) shall be the market value of such shares as 
determined by the Secretary, on the basis of an independent 
appraisal, but shall not be less than the value of such shares 
as shown on the books of account of the Corporation as of the 
date of closing of such purchase. In no event shall the 
purchase price be less than the original issuance price.
  [(c) Board of Directors Elected After Majority Buy-Out.--If 
the Student Loan Marketing Association acquires from the 
Secretary sufficient voting common stock so as to own more than 
50 percent of the issued and outstanding voting common stock of 
the Corporation, section 754 (except subsection (b)) shall be 
of no further force or effect and the Board of Directors of the 
Corporation shall thereafter be elected entirely by the voting 
common shareholders.
  [(d) Right of First Refusal to Association.--Until such time 
as the Student Loan Marketing Association acquires all of the 
voting common stock owned by the Secretary, the Student Loan 
Marketing Association shall have the right to purchase all, or 
any lesser portion it shall select, of each of the issues of 
equity securities or other securities convertible into equity 
of the Corporation as the Corporation may issue from time to 
time, on the same terms and conditions as such securities are 
to be offered to other persons.
  [(e) Authority of Association With Respect to Corporation.--
The Student Loan Marketing Association is authorized and 
empowered to purchase stock and to carry out such other 
activities as are necessary and appropriate for carrying out 
the Association's obligations and responsibilities with respect 
to the Corporation. The Student Loan Marketing Association is 
also authorized to enter into such other transactions with the 
Corporation, including the acquisition of securities and 
obligations of the Corporation referred to in this section and 
sections 755 and 756, and arrangements for the provision of 
management and other services to the Corporation, as shall be 
approved by the Student Loan Marketing Association and the 
Corporation.

[SEC. 759. USE OF STOCK SALE PROCEEDS.

  [The proceeds received by the Secretary upon the sale of any 
shares of the Corporation to the Student Loan Marketing 
Association or any other person shall be deposited in the 
general fund of the Treasury.

[SEC. 760. AUDITS; REPORTS TO THE PRESIDENT AND THE CONGRESS.

  [(a) Accounting.--The books of account of the Corporation 
shall be maintained in accordance with generally accepted 
accounting principles and shall be subject to an annual audit 
by an independent public accountant.
  [(b) Reports.--The Corporation shall transmit to the 
President and the Congress, annually and at such other times as 
it deems desirable, a report of its operations and activities 
under this part, which annual report shall include a copy of 
the Corporation's financial statements and the opinion with 
respect thereto prepared by the independent public accountant 
reviewing such statements and a copy of any report made on an 
audit conducted under subsection (a). The annual reports shall 
include such information and other evidence as is necessary to 
demonstrate that the Corporation has complied with the 
requirements of section 752.]
          * * * * * * *
                              ----------                              


                        THE ACT OF MARCH 3, 1931

             (Commonly referred to as the Davis-Bacon Act)

   [AN ACT relating to the rate of wages for laborers and mechanics 
 employed on public buildings of the United States and the District of 
   Columbia by contractors and subcontractors, and for other purposes

  [(a) That the advertised specifications for every contract in 
excess of $2,000, to which the United States or the District of 
Columbia is a party, for construction, alteration, and/or 
repair, including painting and decorating, of public buildings 
or public works of the United States or the District of 
Columbia within the geographical limits of the States of the 
Union or the District of Columbia, and which requires or 
involves the employment of mechanics, and/or laborers shall 
contain a provision stating the minimum wages to be paid 
various classes of laborers and mechanics which shall be based 
upon the wages that will be determined by the Secretary of 
Labor to be prevailing for the corresponding classes of 
laborers and mechanics employed on projects of a character 
similar to the contract work in the city, town, village, or 
other civil subdivision of the State in which the work is to be 
performed, or in the District of Columbia if the work is to be 
performed there; and every contract based upon these 
specifications shall contain a stipulation that the contractor 
or his subcontractor shall pay all mechanics and laborers 
employed directly upon the site of the work, unconditionally 
and not less often than once a week, and without subsequent 
deduction or rebate on any account, the full amounts accrued at 
time of payment, computed at wage rates not less than those 
stated in the advertised specifications, regardless of any 
contractual relationship which may be alleged to exist between 
the contractor or subcontractor and such laborers and 
mechanics, and that the scale of wages to be paid shall be 
posted by the contractor in a prominent and easily accessible 
place at the site of the work; and the further stipulation that 
there may be withheld from the contractor so much of accrued 
payments as may be considered necessary by the contracting 
officer to pay to laborers and mechanics employed by the 
contractor or any subcontractor on the work the difference 
between the rates of wages required by the contract to be paid 
laborers and mechanics on the work and the rates of wages 
received by such laborers and mechanics and not refunded to the 
contractor, subcontractors, or their agents.
  [(b) As used in the Act the term ``wages'', ``scale of 
wages'', ``wage rates'', ``minimum wages'', and ``prevailing 
wages'' shall include--
          [(1) the basic hourly rate of pay; and
          [(2) the amount of--
                  [(A) the rate of contribution irrevocably 
                made by a contractor or subcontractor to a 
                trustee or to a third person pursuant to a 
                fund, plan, or program; and
                  [(B) the rate of costs to the contractor or 
                subcontractor which may be reasonably 
                anticipated in providing benefits to laborers 
                and mechanics pursuant to an enforcible 
                commitment to carry out a financially 
                responsible plan or program which was 
                communicated in writing to the laborers and 
                mechanics affected,
        for medical or hospital care, pensions on retirement or 
        death, compensation for injuries or illness resulting 
        from occupational activity, or insurance to provide any 
        of the foregoing, for unemployment benefits, life 
        insurance, disability and sickness in-surance, or 
        accident insurance, for vacation and holiday pay, for 
        defraying costs of apprenticeship or other similar 
        programs, or for other bona fide fringe benefits, but 
        only where the contractor or subcontractor is not 
        required by other Federal, State, or local law to 
        provide any of such benefits:
Provided, That the obligation of a contractor or subcontractor 
to make payment in accordance with the prevailing wage 
determinations of the Secretary of Labor, insofar as this Act 
and other Acts incorporating this Act by reference are 
concerned may be discharged by the making of payments in cash, 
by the making of contributions of a type referred to in 
paragraph (2)(A), or by the assumption of an enforcible 
commitment to bear the costs of a plan or program of a type 
referred to in paragraph (2)(B), or any combination thereof, 
where the aggregate of any such payments, contributions, and 
costs is not less than the rate of pay described in paragraph 
(1) plus the amount referred to in paragraph (2).
  [In determining the overtime pay to which the laborer or 
mechanic is entitled under any Federal law, his regular or 
basic hourly rate of pay (or other alternative rate upon which 
premium rate of overtime compensation is computed) shall be 
deemed to be the rate computed under paragraph (1), except that 
where the amount of payments, contributions, or costs incurred 
with respect to him exceeds the prevailing wage applicable to 
him under this Act, such regular or basic hourly rate of pay 
(or such other alternative rate) shall be arrived at by 
deducting from the amount of payments, contributions, or costs 
actually incurred with respect to him, the amount of 
contributions or costs of the types described in paragraph (2) 
actually incurred with respect to him, or the amount determined 
under paragraph (2) but not actually paid, whichever amount is 
the greater.
  [Sec. 2. Every contract within the scope of this Act shall 
contain the further provision that in the event it is found by 
the contracting officer that any laborer or mechanic employed 
by the contractor or any subcontractor directly on the site of 
the work covered by the contract has been or is being paid a 
rate of wages less than the rate of wages required by the 
contract to be paid as aforesaid, the Government may, by 
written notice to the contractor, terminate his right to 
proceed with the work or such part of the work as to which 
there has been a failure to pay said required wages and to 
prosecute the work to completion by contract or otherwise, and 
the contractor and his sureties shall be liable to the 
Government for any excess costs occasioned the Government 
thereby.
  [Sec. 3. (a) The Comptroller General of the United States is 
hereby authorized and directed to pay directly to laborers and 
mechanics from any accrued payments withheld under the terms of 
the contract any wages found to be due laborers and mechanics 
pursuant to this Act; and the Comptroller General of the United 
States is further authorized and is directed to distribute a 
list to all departments of the Government giving the names of 
the persons or firms whom he has found to have disregarded 
their obligations to employees and subcontractors. No contract 
shall be awarded to the persons or firms appearing on this list 
or to any firm, corporation, partnership, or association in 
which such persons or firms have an interest until three years 
have elapsed from the date of publication of the list 
containing the names of such persons or firms.
  [(b) If the accrued payments withheld under the terms of the 
contract, as aforesaid, are insufficient to reimburse all the 
laborers and mechanics with respect to whom there has been a 
failure to pay the wages required pursuant to this Act, such 
laborers and mechanics shall have the right to action and/or of 
intervention against the contractor and his sureties conferred 
by law upon persons furnishing labor or materials, and in such 
proceedings it shall be no defense that such laborers and 
mechanics accepted or agreed to accept less than the required 
rate of wages or voluntarily made refunds.
  [Sec. 4. This Act shall not be construed to supersede or 
impair any authority otherwise granted by Federal law to 
provide for the establishment of specific wage rates.
  [Sec. 5. This Act shall take effect thirty days after its 
passage, but shall not affect any contract then existing or any 
contract that may therefore be entered into pursuant to 
invitations for bids that are outstanding at the time of the 
passage of this Act.
  [Sec. 6. In the event of a national emergency the President 
is authorized to suspend the provisions of this Act.
  [Sec. 7. The funds appropriated and made available by the 
Emergency Relief Appropriation Act of 1935 (Public Resolution 
Numbered 11, Seventy-fourth Congress), are hereby made 
available for the fiscal year ending June 30, 1936, to the 
Department of Labor for expenses of the administration of this 
Act.]
                              ----------                              


                    THE SERVICE CONTRACT ACT OF 1965

  [Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That this 
Act may be cited as the ``Service Contract Act of 1965''.
  [Sec. 2. (a) Every contract (and any bid specification 
therefor) entered into by the United States or the District of 
Columbia in excess of $2,500, except as provided in section 7 
of this Act, whether negotiated or advertised, the principal 
purpose of which is to furnish services in the United States 
through the use of service employees shall contain the 
following:
          [(1) A provision specifying the minimum monetary 
        wages to be paid the various classes of service 
        employees in the performance of the contract or any 
        subcontract thereunder, as determined by the Secretary, 
        or his authorized representative, in accordance with 
        prevailing rates for such employees in the locality, 
        or, where a collective-bargaining agreement covers any 
        such service employees, in accordance with the rates 
        for such employees provided for in such agreement, 
        including prospective wage increases provided for in 
        such agreement as a result of arm's-length 
        negotiations. In no case shall such wages be lower than 
        the minimum specified in subsection (b)
          [(2) A provision specifying the fringe benefits to be 
        furnished the various classes of service employees, 
        engaged in the performance of the contract or any 
        subcontract thereunder, as determined by the Secretary 
        or his authorized representative to be prevailing for 
        such employees in the locality, or, where a collective-
        bargaining agreement covers any such service employees, 
        to be provided for in such agreement, including 
        prospective fringe benefit increases provided for in 
        such agreement as a result of arm's-length 
        negotiations. Such fringe benefits shall include 
        medical or hospital care, pensions on retirement or 
        death, compensation for injuries or illness resulting 
        from occupational activity, or insurance to provide any 
        of the foregoing, unemployment benefits, life 
        insurance, disability and sickness insurance, accident 
        insurance, vacation and holiday pay, costs of 
        apprenticeship or other similar programs and other bona 
        fide fringe benefits not otherwise required by Federal, 
        State, or local law to be provided by the contractor or 
        subcontractor. The obligation under this subparagraph 
        may be discharged by furnishing any equivalent 
        combinations of fringe benefits or by making equivalent 
        or differential payments in cash under rules and 
        regulations established by the Secretary.
          [(3) A provision that no part of the services covered 
        by this Act will be performed in buildings or 
        surroundings or under working conditions, provided by 
        or under the control or supervision of the contractor 
        or any subcontractor, which are unsanitary or hazardous 
        or dangerous to the health or safety of service 
        employees engaged to furnish the services.
          [(4) A provision that on the date a service employee 
        commences work on a contract to which this Act applies, 
        the contractor or subcontractor will deliver to the 
        employee a notice of the compensation required under 
        paragraphs (1) and (2) of this subsection, on a form 
        prepared by the Federal agency, or will post a notice 
        of the required compensation in a prominent place at 
        the worksite.
          [(5) A statement of the rates that would be paid by 
        the Federal agency to the various classes of service 
        employees if section 5341 or section 5332 of title 5, 
        United States Code, were applicable to them. The 
        Secretary shall give due consideration to such rates in 
        making the wage and fringe benefit determinations 
        specified in this section.
  [(b)(1) No contractor who enters into any contract with the 
Federal Government the principal purpose of which is to furnish 
services through the use of service employees and no 
subcontractor thereunder shall pay any of his employees engaged 
in performing work on such contracts less than the minimum wage 
specified under section 6(a)(1) of the Fair Labor Standards Act 
of 1938, as amended (52 Stat. 1060; 29 U.S.C. 201, et seq.).
  [(2) The provisions of sections 3, 4, and 5 of this Act shall 
be applicable to violations of this subsection.
  [Sec. 3. (a) Any violation of any of the contract 
stipulations required by section 2(a) (1) or (2) or of section 
2(b) of this Act shall render the party responsible therefor 
liable for a sum equal to the amount of any deductions, 
rebates, refunds, or underpayment of compensation due to any 
employee engaged in the performance of such contract. So much 
of the accrued payment due on the contract or any other 
contract between the same contractor and the Federal Government 
may be withheld as is necessary to pay such employees. Such 
withheld sums shall be held in a deposit fund. On order of the 
Secretary, any compensation which the head of the Federal 
agency or the Secretary has found to be due pursuant to this 
Act shall be paid directly to the underpaid employees from any 
accrued payments withheld under this Act.
  [(b) In accordance with regulations prescribed pursuant to 
section 4 of this Act, the Federal agency head or the Secretary 
is hereby authorized to carry out the provisions of this 
section.
  [(c) In addition, when a violation is found of any contract 
stipulation, the contract is subject upon written notice to 
cancellation by the contracting agency. Whereupon, the United 
States may enter into other contracts or arrangements for the 
completion of the original contract, charging any additional 
cost to the original contractor.
  [Sec. 4. (a) Sections 4 and 5 of the Act of June 30, 1936 (49 
Stat. 2036), as amended, shall govern the Secretary's authority 
to enforce this Act, make rules, regulations, issue orders, 
hold hearings, and make decisions based upon findings of fact, 
and take other appropriate action hereunder.
  [(b) The Secretary may provide such reasonable limitations 
and may make such rules and regulations allowing reasonable 
variations, tolerances, and exemptions to and from any or all 
provisions of this Act (other than section 10), but only in 
special circumstances where he determines that such limitation, 
variation, tolerance, or exemption is necessary and proper in 
the public interest or to avoid the serious impairment of 
government business, and is in accord with the remedial purpose 
of this Act to protect prevailing labor standards.
  [(c) No contractor or subcontractor under a contract, which 
succeeds a contract subject to this Act and under which 
substantially the same services are furnished, shall pay any 
service employee under such contract less than the wages and 
fringe benefits, including accrued wages and fringe benefits, 
and any prospective increases in wages and fringe benefits 
provided for in a collective-bargaining agreement as a result 
of arm's-length negotiations, to which such service employees 
would have been entitled if they were employed under the 
predecessor contract: Provided, That in any of the foregoing 
circumstances such obligations shall not apply if the Secretary 
finds after a hearing in accordance with regulations adopted by 
the Secretary that such wages and fringe benefits are 
substantially at variance with those which prevail for services 
of a character similar in the locality.
  [(d) Subject to limitations in annual appropriation Acts but 
notwithstanding any other provision of law, contracts to which 
this Act applies may, if authorized by the Secretary, be for 
any term of years not exceeding five, if each such contract 
provides for the periodic adjustment of wages and fringe 
benefits pursuant to future determinations, issued in the 
manner prescribed in section 2 of this Act no less often than 
once every two years during the term of the contract, covering 
the various classes of service employees.
  [Sec. 5. (a) The Comptroller General is directed to 
distribute a list to all agencies of the Government giving the 
names of persons or firms that the Federal agencies or the 
Secretary have found to have violated this Act. Unless the 
Secretary otherwise recommends because of unusual 
circumstances, no contract of the United States shall be 
awarded to the persons or firms appearing on this list or to 
any firm, corporation, partnership, or association in which 
such persons or firms have a substantial interest until three 
years have elapsed from the date of publication of the list 
containing the name of such persons or firms. Where the 
Secretary does not otherwise recommend because of unusual 
circumstances, he shall, not later than ninety days after a 
hearing examiner has made a finding of a violation of this Act, 
forward to the Comptroller General the name of the individual 
or firm found to have violated the provisions of this Act.
  [(b) If the accrued payments withheld under the terms of the 
contract are insufficient to reimburse all service employees 
with respect to whom there has been a failure to pay the 
compensation required pursuant to this Act, the United States 
may bring action against the contractor, subcontractor, or any 
sureties in any court of competent jurisdiction to recover the 
remaining amount of underpayments. Any sums thus recovered by 
the United States shall be held in the deposit fund and shall 
be paid, on order of the Secretary, directly to the underpaid 
employee or employees. Any sum not paid to an employee because 
of inability to do so within three years shall be covered into 
the Treasury of the United States as miscellaneous receipts.
  [Sec. 6. In determining any overtime pay to which such 
service employees are entitled under any Federal law, the 
regular or basic hourly rate of pay of such an employee shall 
not include any fringe benefit payments computed hereunder 
which are excluded from the regular rate under the Fair Labor 
Standards Act by provisions of section 7(d) thereof.
  [Sec. 7. This Act shall not apply to--
          [(1) any contract of the United States or District of 
        Columbia for construction, alteration and/or repair, 
        including painting and decorating of public buildings 
        or public works;
          [(2) any work required to be done in accordance with 
        the provisions of the Walsh-Healey Public Contracts Act 
        (49 Stat. 2036);
          [(3) any contract for the carriage of freight or 
        personnel by vessel, airplane, bus, truck, express, 
        railway line or oil or gas pipeline where published 
        traff rates are in effect;
          [(4) any contract for the furnishing of services by 
        radio, telephone, telegraph, or cable companies, 
        subject to the Communications Act of 1934;
          [(5) any contract for public utility services, 
        including electric light and power, water, steam, and 
        gas;
          [(6) any employment contract providing for direct 
        services to a Federal agency by an individual or 
        individuals; and
          [(7) any contract with the Post Office Department, 
        the principal purpose of which is the operation of 
        postal contract stations.
  [Sec. 8. For the purpose of this Act--
  [(a) ``Secretary'' means Secretary of Labor.
  [(b) The term ``service employee'' means any person engaged 
in the performance of a contract entered into the United States 
and not exempted under section 7, whether negotiated or 
advertised, the principal purpose of which is to furnish 
services in the United States (other than any person employed 
in a bona fide executive, administrative, or professional 
capacity, as those terms are defined in part 541 of title 29, 
Code of Federal Regulations, as of July 30, 1976, and any 
subsequent revision of those regulations); and shall include 
all such persons regardless of any contractual relationship 
that may be alleged to exist between a contractor or 
subcontractor and such persons.
  [(c) The term ``compensation'' means any of the payments or 
fringe benefits described in section 2 of this Act.
  [(d) The term ``United States'' when used in a geographical 
sense shall include any State of the United States, the 
District of Columbia, Puerto Rico, the Virgin Islands, Outer 
Continental Shelf lands as defined in the Outer Continental 
Shelf Lands Act, American Samoa, Guam, Wake Island, Eniwetok 
Atoll, Kwajalein Atoll, Johnston Island, and Canton Island, but 
shall not include any other territory under the jurisdiction of 
the United States or any United States base or possession 
within a foreign country.
  [Sec. 9. This Act shall apply to all contracts entered into 
pursuant to negotiations concluded or invitations for bids 
issued on or after ninety days from the date of enactment of 
this Act.
  [Sec. 10. It is the intent of the Congress that 
determinations of minimum monetary wages and fringe benefits 
for the various classes of service employees under the 
provisions of paragraphs (1) and (2) of section 2 should be 
made with respect to all contracts subject to this Act, as soon 
as it is administratively feasible to do so. In any event, the 
Secretary shall make such determinations with respect to at 
least the following contracts subject to this Act which are 
entered into during the applicable fiscal year:
          [(1) For the fiscal year ending June 30, 1973, all 
        contracts under which more than twenty-five service 
        employees are to be employed.
          [(2) For the fiscal year ending June 30, 1974, all 
        contracts under which more than twenty service 
        employees are to be employed.
          [(3) For the fiscal year ending June 30, 1975, all 
        contracts under which more than fifteen service 
        employees are to be employed.
          [(4) For the fiscal year ending June 30, 1976, all 
        contracts under which more than ten service employees 
        are to be employed.
          [(5) On or after July 1, 1976, all contracts under 
        which more than five service employees are to be 
        employed.]

                             rollcall no. 1

    By Mr. Petri: A Motion to move the previous question on 
debate to postpone the markup passed by a vote of 17 to 15.

------------------------------------------------------------------------
                  Member                      Aye       No      Present 
------------------------------------------------------------------------
Chairman Goodling........................        X   ........  .........
Mr. Petri................................        X   ........  .........
Mrs. Roukema.............................  ........  ........  .........
Mr. Gunderson............................        X   ........  .........
Mr. Fawell...............................        X   ........  .........
Mr. Ballenger............................        X   ........  .........
Mr. Barrett..............................        X   ........  .........
Mr. Cunningham...........................        X   ........  .........
Mr. Hoekstra.............................        X   ........  .........
Mr. McKeon...............................        X   ........  .........
Mr. Castle...............................        X   ........  .........
Mrs. Meyers..............................  ........  ........  .........
Mr. Johnson..............................        X   ........  .........
Mr. Talent...............................  ........  ........  .........
Mr. Greenwood............................  ........  ........  .........
Mr. Hutchinson...........................  ........  ........  .........
Mr. Knollenberg..........................        X   ........  .........
Mr. Riggs................................        X   ........  .........
Mr. Graham...............................        X   ........  .........
Mr. Weldon...............................        X   ........  .........
Mr. Funderburk...........................  ........  ........  .........
Mr. Souder...............................  ........  ........  .........
Mr. McIntosh.............................        X   ........  .........
Mr. Norwood..............................        X   ........  .........
Mr. Clay.................................  ........        X   .........
Mr. Miller...............................  ........        X   .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........        X   .........
Mr. Martinez.............................  ........        X   .........
Mr. Owens................................  ........        X   .........
Mr. Sawyer...............................  ........        X   .........
Mr. Payne................................  ........        X   .........
Mrs. Mink................................  ........        X   .........
Mr. Andrews..............................  ........  ........  .........
Mr. Reed.................................  ........        X   .........
Mr. Roemer...............................  ........        X   .........
Mr. Engel................................  ........  ........  .........
Mr. Becerra..............................  ........        X   .........
Mr. Scott................................  ........        X   .........
Mr. Green................................  ........  ........  .........
Ms. Woolsey..............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........        X   .........
Mr. Reynolds.............................  ........  ........  .........
                                          ------------------------------
      Totals.............................       17        15   .........
------------------------------------------------------------------------

                             rollcall no. 2

    By Mr. Clay: A motion to postpone the markup indefinitely. 
Defeated by a vote of 16 to 20.

------------------------------------------------------------------------
                  Member                      Aye       No      Present 
------------------------------------------------------------------------
Chairman Goodling........................  ........        X   .........
Mr. Petri................................  ........        X   .........
Mrs. Roukema.............................  ........  ........  .........
Mr. Gunderson............................  ........        X   .........
Mr. Fawell...............................  ........        X   .........
Mr. Ballenger............................  ........        X   .........
Mr. Barrett..............................  ........        X   .........
Mr. Cunningham...........................  ........        X   .........
Mr. Hoekstra.............................  ........        X   .........
Mr. McKeon...............................  ........        X   .........
Mr. Castle...............................  ........        X   .........
Mrs. Meyers..............................  ........        X   .........
Mr. Johnson..............................  ........        X   .........
Mr. Talent...............................  ........        X   .........
Mr. Greenwood............................  ........  ........  .........
Mr. Hutchinson...........................  ........        X   .........
Mr. Knollenberg..........................  ........        X   .........
Mr. Riggs................................  ........        X   .........
Mr. Graham...............................  ........        X   .........
Mr. Weldon...............................  ........        X   .........
Mr. Funderburk...........................  ........  ........  .........
Mr. Souder...............................  ........  ........  .........
Mr. McIntosh.............................  ........        X   .........
Mr. Norwood..............................  ........        X   .........
Mr. Clay.................................        X   ........  .........
Mr. Miller...............................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................        X   ........  .........
Mr. Martinez.............................        X   ........  .........
Mr. Owens................................        X   ........  .........
Mr. Sawyer...............................        X   ........  .........
Mr. Payne................................        X   ........  .........
Mrs. Mink................................        X   ........  .........
Mr. Andrews..............................  ........  ........  .........
Mr. Reed.................................        X   ........  .........
Mr. Roemer...............................        X   ........  .........
Mr. Engel................................  ........  ........  .........
Mr. Becerra..............................        X   ........  .........
Mr. Scott................................        X   ........  .........
Mr. Green................................        X   ........  .........
Ms. Woolsey..............................        X   ........  .........
Mr. Romero-Barcelo.......................        X   ........  .........
Mr. Reynolds.............................  ........  ........  .........
                                          ------------------------------
      Totals.............................       16        20   .........
------------------------------------------------------------------------

                             RollCall No. 3

    By Mr. Williams: A motion to refer the legislation to the 
Subcommittee on Postsecondary Education, Training and Life-Long 
Learning. Defeated by a vote of 11 to 23.

------------------------------------------------------------------------
                  Member                      Aye       No      Present 
------------------------------------------------------------------------
Chairman Goodling........................  ........        X   .........
Mr. Petri................................  ........        X   .........
Mrs. Roukema.............................  ........        X   .........
Mr. Gunderson............................  ........        X   .........
Mr. Fawell...............................  ........        X   .........
Mr. Ballenger............................  ........        X   .........
Mr. Barrett..............................  ........        X   .........
Mr. Cunningham...........................  ........        X   .........
Mr. Hoekstra.............................  ........        X   .........
Mr. McKeon...............................  ........        X   .........
Mr. Castle...............................  ........        X   .........
Mrs. Meyers..............................  ........        X   .........
Mr. Johnson..............................  ........        X   .........
Mr. Talent...............................  ........        X   .........
Mr. Greenwood............................  ........  ........  .........
Mr. Hutchinson...........................  ........        X   .........
Mr. Knollenberg..........................  ........        X   .........
Mr. Riggs................................  ........        X   .........
Mr. Graham...............................  ........        X   .........
Mr. Weldon...............................  ........        X   .........
Mr. Funderburk...........................  ........        X   .........
Mr. Squder...............................  ........        X   .........
Mr. McIntosh.............................  ........        X   .........
Mr. Norwood..............................  ........        X   .........
Mr. Clay.................................        X   ........  .........
Mr. Miller...............................  ........  ........  .........
Mr. Kidlee...............................        X   ........  .........
Mr. Williams.............................        X   ........  .........
Mr. Martinez.............................        X   ........  .........
Mr. Owens................................  ........  ........  .........
Mr. Sawyer...............................        X   ........  .........
Mr. Payne................................  ........  ........  .........
Mrs. Mink................................        X   ........  .........
Mr. Andrews..............................        X   ........  .........
Mr. Reed.................................        X   ........  .........
Mr. Roemer...............................        X   ........  .........
Mr. Engel................................  ........  ........  .........
Mr. Becerra..............................  ........  ........  .........
Mr. Scott................................        X   ........  .........
Mr. Green................................  ........  ........  .........
Ms. Woolsey..............................        X   ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Reynolds.............................  ........  ........  .........
      Totals.............................       11        23   .........
                                          ------------------------------
------------------------------------------------------------------------

                             RollCall No. 4

    By Mr. Petri: A motion to report with an amendment in the 
nature of a substitute the reconciliation recommendations to 
the Committee on the Budget. Passed by a vote of 23 to 14.

------------------------------------------------------------------------
                  Member                      Aye       No      Present 
------------------------------------------------------------------------
Chairman Goodling........................        X   ........  .........
Mr. Petri................................  ........        X   .........
Mrs. Roukema.............................        X   ........  .........
Mr. Gunderson............................        X   ........  .........
Mr. Fawell...............................        X   ........  .........
Mr. Ballenger............................        X   ........  .........
Mr. Barrett..............................        X   ........  .........
Mr. Cunningham...........................        X   ........  .........
Mr. Hoekstra.............................        X   ........  .........
Mr. McKeon...............................        X   ........  .........
Mr. Castle...............................        X   ........  .........
Mrs. Meyers..............................        X   ........  .........
Mr. Johnson..............................        X   ........  .........
Mr. Talent...............................        X   ........  .........
Mr. Greenwood............................        X   ........  .........
Mr. Hutchinson...........................        X   ........  .........
Mr. Knollenberg..........................        X   ........  .........
Mr. Riggs................................        X   ........  .........
Mr. Graham...............................        X   ........  .........
Mr. Weldon...............................        X   ........  .........
Mr. Funderburk...........................        X   ........  .........
Mr. Souder...............................        X   ........  .........
Mr. McIntosh.............................        X   ........  .........
Mr. Norwood..............................        X   ........  .........
Mr. Clay.................................  ........        X   .........
Mr. Miller...............................  ........  ........  .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........        X   .........
Mr. Martinez.............................  ........        X   .........
Mr. Owens................................  ........        X   .........
Mr. Sawyer...............................  ........        X   .........
Mr. Payne................................  ........  ........  .........
Mrs. Mink................................  ........        X   .........
Mr. Andrews..............................  ........        X   .........
Mr. Reed.................................  ........        X   .........
Mr. Roemer...............................  ........        X   .........
Mr. Engel................................  ........  ........  .........
Mr. Becerra..............................  ........        X   .........
Mr. Scott................................  ........        X   .........
Mr. Green................................  ........  ........  .........
Ms. Woolsey..............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Reynolds.............................  ........  ........  .........
                                          ------------------------------
      Totals.............................       23        14   .........
------------------------------------------------------------------------

     Budget Authority and Congressional Budget Office Cost Estimate

    With respect to the requirement of clause 2(l)(3)(B) of 
rule XI of the House of Representatives and section 308(a) of 
the Congressional Budget Act of 1974 and with respect to 
requirements of clause 2(l)(3)(C) of rule XI of the House of 
Representatives and section 403 of the Congressional Budget Act 
of 1974, the committee has received the following cost estimate 
for the committee's recommendations from the Director of the 
Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 6, 1995.
Hon. William F. Goodling,
Chairman, Committee on Economic and Educational Opportunities,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office [CBO] 
has prepared the enclosed cost estimate for the reconciliation 
language approved by the House Committee on Economic and 
Educational Opportunities on September 28, 1995.
    The estimate shows the budgetary effects of the committee's 
proposals over the 1996-2002 period. CBO understands that the 
Committee on the Budget will be responsible for interpreting 
how these proposals compare with the reconciliation 
instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    1. Bill title: Reconciliation Recommendations of the House 
Committee on Economic and Educational Opportunities.
    2. Bill status: As approved by the House Committee on 
Economic and Educational Opportunities, September 28, 1995.
    3. Bill purpose: To reduce the cost of the Federal student 
loan programs, to privatize the College Construction Loan 
Insurance Association [Connie Lee] by removing its current 
government-sponsored enterprise [GSE] status and requiring the 
sale of the government's stock in the corporation, to repeal 
the Davis-Bacon and Service Contract Acts, and to amend the 
Employee Retirement Income Security Act [ERISA] to provide for 
a waiver for the 30-day minimum waiting period for joint and 
survivor annuity.
    4. Estimated cost to the Federal Government: Table 1 
summarizes the budgetary effects of this bill, assuming that 
appropriations are reduced to reflect the repeals of the Davis-
Bacon and Service Contract Acts.

  TABLE 1. BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON ECONOMIC AND EDUCATIONAL  
                                                  OPPORTUNITIES                                                 
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                              1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                                 DIRECT SPENDING                                                
                                                                                                                
Changes in Student Loans:                                                                                       
    Estimated Budget Authority............    -1,709    -1,144    -1,330    -1,553    -1,601    -1,671    -1,746
    Estimated Outlays.....................    -1,393    -1,126    -1,261    -1,463    -1,589    -1,654    -1,722
Repeal of the Davis-Bacon and Service                                                                           
 Contract Acts:                                                                                                 
    Estimated Budget Authority............        -4        -7        -6        -5        -5        -5        -4
    Estimated Outlays.....................        -1        -4        -5        -5        -5        -4        -4
                                           ---------------------------------------------------------------------
      Total:                                                                                                    
        Estimated Budget Authority........    -1,713    -1,151    -1,336    -1,558    -1,606    -1,676    -1,750
                                           =====================================================================
        Estimated Outlays.................    -1,394    -1,130    -1,266    -1,468    -1,594    -1,658    -1,726
                                           =====================================================================
                                                                                                                
                                            RECEIPTS FROM ASSET SALES                                           
                                                                                                                
Sale of Connie Lee Stock:                                                                                       
    Estimated Budget Authority............        -7         0         0         0         0         0         0
    Estimated Outlays.....................        -7         0         0         0         0         0         0
                                                                                                                
                                        AUTHORIZATIONS OF APPROPRIATIONS                                        
                                                                                                                
Repeal of the Davis-Bacon and Service                                                                           
 Contracts Acts:                                                                                                
    Estimated Obligational Authority......    -1,067    -1,462    -1,508    -1,552    -1,601    -1,651    -1,701
    Estimated Outlays.....................      -547      -978    -1,198    -1,343    -1,464    -1,517    -1,568
----------------------------------------------------------------------------------------------------------------
Note.--Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes
  of congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in
  determining compliance with the discretionary spending limits or pay-as-you-go requirements.                  

    5. Basis of estimate: Student loans. This estimate assumes 
that the reconciliation bill will be enacted by November 15, 
1995; the estimate could change if the bill is enacted later. 
The bill establishes an overall effective date for all student 
loan provisions of January 1, 1996, unless otherwise noted. In 
addition, the proposed student loan program changes are 
estimated based on the assumptions of the budget resolution for 
fiscal year 1996, which modified the accounting for the direct 
administrative costs of the direct student loan program.
    Most provisions affecting the student loan programs are 
assessed under the requirements of credit reform. As such, the 
budget estimates are calculated on a present value basis, which 
accounts for all of the costs and collections associated with 
the loans regardless of the year in which they occur.
    This bill makes several changes in the student loan 
programs, which under current law are expected to guarantee or 
issue about 50 million new loans totaling roughly $220 billion 
over the 7 years. The combination of program revisions 
essentially leave program eligibility unchanged while lowering 
the government's cost of providing loan capital to students and 
parents. In general, the proposed changes may be generally 
classified by their impacts: changes affecting program 
financing, changes affecting borrowers' costs, changes imposing 
increased costs on lenders or holders of student loans, and 
changes affecting guarantors.
    The combination of the changes included in this bill would 
lower program costs by $1.4 billion in 1996 and $10.2 billion 
over the 1996-2002 period (see table 2). By 2002, the overall 
Federal discounted cost of providing loan capital to students 
and parents would be reduced by about 4 percent per each dollar 
loaned from an estimated 12 percent to 8 percent.

                      TABLE 2. BUDGETARY IMPACT OF STUDENT LOAN PROPOSALS--DIRECT SPENDING                      
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                    1995      1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
Spending Under Current Law: \1\                                                                                 
 \2\                                                                                                            
    Estimated Budget Authority..     4,450     3,974     3,652     3,991     4,364     4,661     4,881     5,110
    Estimated Outlays...........     3,824     3,429     3,504     3,520     3,818     4,138     4,336     4,536
Proposed Changes:                                                                                               
    Estimated Budget Authority..  ........    -1,709    -1,144    -1,330    -1,553    -1,601    -1,671    -1,746
    Estimated Outlays...........  ........    -1,393    -1,126    -1,261    -1,463    -1,589    -1,654    -1,722
Spending Under the Proposal: \1\                                                                                
 \2\                                                                                                            
    Estimated Budget Authority..     4,450     2,265     2,508     2,661     2,811     3,060     3,210     3,364
    Estimated Outlays...........     3,824     2,036     2,378     2,259     2,255     2,549     2,682     2,814
----------------------------------------------------------------------------------------------------------------
\1\ Spending totals exclude the liquidating accounts.                                                           
\2\ Spending totals reflect the treatment of direct loan administrative costs specified in the budget           
  resolution.                                                                                                   

    The attached table shows the budgetary effects of each 
proposal which significantly affects the costs of the student 
loan programs, estimated as if each proposal were the only 
change to current law. Only those proposed changes with 
significant effects on the Federal budget are discussed in the 
text below. The interactions among all of the proposed changes 
are totaled as a separate line in the table.
    Program Financing. All students would be required to 
receive their loans through the guaranteed loan program, where 
the calculated Federal costs of providing the loan are 
marginally lower than through the direct loan program. The 
direct loan program would be terminated. Also, the amount of 
funds available from the current capped entitlement fund to 
cover Department of Education administrative expenses for the 
direct loan program would be substantially reduced.
    This bill would terminate the current direct loan program 
in July 1996. Over the next 7 years, approximately $115 billion 
in loan volume would be shifted to the guaranteed loan program. 
Under the assumptions of the budget resolution, guaranteed 
loans have a marginally lower calculated Federal subsidy cost. 
By itself, this shift of loan volume to the guaranteed loan 
programs lowers Federal costs by an estimated $855 million over 
the 1996-2002 period.
    This year's budget resolution conformed the budget 
treatment of the administrative costs of direct student loans 
with that for guaranteed student loans. For purposes of the 
congressional budget scorekeeping, the change overrides the 
Credit Reform Act, which requires that the Federal 
administrative costs for direct loan programs be accorded a 
cash-accounting treatment. For estimating legislation under the 
budget resolution, CBO has included in the baseline for direct 
student loans the present value of the direct Federal 
administrative costs, including the loans' servicing costs. 
Thus, the subsidy cost of direct loans issued in a given year 
includes all administrative costs over the life of the loan 
portfolio, taking account of the time value of funds. The 
subsidy costs of any cohort of direct loans will include the 
discounted future administrative costs of servicing loans which 
may be in repayment (or collection) for as long as 25 to 30 
years. The inclusion of these administrative costs in the 
subsidy calculations for direct loans increases the subsidy 
rates for these loans by about 7 percentage points.
    Incorporating the direct administrative costs of direct 
student loans in the subsidy calculations (under the 
assumptions of the budget resolution) brings the subsidy costs 
of direct loans to levels slightly above that for guaranteed 
loans in each of the next 7 years except 1997. As a result, a 
shift to 100 percent guaranteed loans would reduce overall 
subsidy costs under the assumption of the budget resolution, 
whereas the same change would appear to increase costs under 
the assumptions of the CBO baseline, which shows the direct 
administrative costs of direct loans on a cash basis.
    Although subsidy rates for direct student loans are 
generally higher than those for guaranteed loans under the 
budget resolution assumptions, the difference is modest, and a 
reversal of the relative costs could occur with only minor 
changes in estimating assumptions. The estimated cost of the 
direct loan program is particularly sensitive to the interest 
rates used.
    The budget resolution included $2.2 billion for 1996 
through 2002 for the Department of Education's administrative 
capped entitlement fund after adjusting that fund for the 
exclusion of direct administrative expenses. This bill would 
reduce the funds for indirect Federal administrative expenses 
by about $850 million over the next 7 years. It would also 
reduce direct payments to guaranty agencies by a total of $785 
million.
    Borrowers. The amount of interest the government pays 
lenders on the students' behalf in the subsidized loan program 
would be decreased by reducing the subsidized period by 6 
months. Most student borrowers would have to assume payment of 
one-half year's interest expense, about 4 percent of the 
original principal amount of the loan. In addition, the 
interest rate on loans to parent borrowers as well as the 
maximum interest rate cap would be increased. Also, the maximum 
amount a parent would be eligible to borrow per student would 
be limited to $15,000 annually.
    Under current law, students with subsidized loans have a 6-
month grace period after they leave school during which the 
Federal Government pays the interest on the loans. This 
legislation would shift the burden of these interest payments 
to students, who could either pay the interest as it accrues 
during the 6-month period or capitalize the interest payments 
into the principal amount of the loan. These provisions, which 
are comparable to features of unsubsidized student loans, would 
save $245 million in 1996 and about $3.8 billion over the 1996-
2002 period.
    Parent loans would be affected by an increase in the 
interest rate and by an increase in the ceiling on the maximum 
interest rate which could be charged. The interest rate for 
parent loans is currently established at the 365-day Treasury 
bill rate plus 3.1 percent for loans made between now and July 
1, 1998, and at the 10-year Treasury bond rate plus 2.1 percent 
for loans after that date. This legislation would set the rate 
at the 365-day Treasury bill rate plus 4.0 percent. In 
addition, the current maximum interest rate which can be 
charged for these loans is 9 percent, and the bill would 
increase this cap to 11 percent. These changes, together with 
the $15,000 annual limit on PLUS loans, would reduce PLUS 
volume by an estimated 1 percent, or about $2.2 billion over 
the 1996-2002 period. Because the estimated subsidy rates on 
these loans are very small, the annual budgetary impact of 
these changes are negligible.
    Lenders and Holders. The income of lenders and holders 
would be reduced, first, by requiring that 1.6 percent of the 
interest income received on parent loans be rebated to the 
Federal Government over the life of the loan. Second, lender 
origination fees would be increased by 0.5 percent of the 
principal amount of the loans. This fee increase, coupled with 
another 0.2 percent of the 0.5 percent currently received by 
the government, would be paid to guaranty agencies to cover 
administrative costs. Third, lenders would, in general, receive 
insurance for only 95 percent of a defaulted loan rather than 
the current 98 percent. Fourth, lenders would be required to 
pay a new 0.2 percent fee any time a loan is sold to another 
lender or holder.
    The imposition on lenders or holders of parent [PLUS] loans 
of a 1.6 percent interest rate rebate would substantially lower 
the Federal costs of PLUS loans. Lenders would have to rebate 
annually to the government an amount equal to 1.6 percent of 
the outstanding principal on each loan they hold. Lenders could 
offset a portion of the rebate by charging higher interest 
rates to borrowers. The rebate fee would reduce Federal costs 
by $90 million in 1996 and by $890 million over the 1996-2002 
period.
    The bill would also increase the origination fees charged 
lenders by the government from 0.5 percent to 1.0 percent of 
the amount of each loan, including loan consolidations. These 
fees plus 0.2 percent of the origination fee now paid to the 
government would be transferred to guaranty agencies, and would 
essentially replace a portion of the payments made to the 
agencies out of the Department of Education's mandatory funds. 
The loss in the Federal share of the origination fees increases 
the subsidy costs by $30 million in 1996 and $235 million over 
the next 7 years.
    Another provision that significantly affects lenders is the 
reduction in the guaranteed portion of the loan. Under current 
law, lenders are paid 98 percent of the defaulted loans they 
turn over to the guaranty agencies. This provision would reduce 
the insured component to 95 percent. Federal costs would be 
reduced by $260 million over the 1996-2002 period.
    Finally, the bill would introduce a new 0.2 percent fee on 
the principal amount of loans sold by one lender or holder to 
another. This fee is estimated to reduce program costs by about 
$170 million over the next 7 years.
    Guarantors. Guaranty agencies would be affected by reducing 
the portion of the loans that would be reinsured, eliminating 
supplemental preclaim assistance subsidies, and increasing the 
length of time the agencies would be required to establish loan 
repayments from defaulters before they could file for Federal 
reinsurance payments.
    In general, guarantors would see their Federal reinsurance 
on defaulted loans lowered from 98 percent to 96 percent. This 
change by itself would save about $180 million over the next 7 
years.
    The Federal subsidies paid to guaranty agencies to perform 
supplemental preclaim assistance to lenders would be 
eliminated, which would reduce subsidy costs by about $255 
million over the 1996-2002 period.
    Guaranty agencies would be required to use their reserve 
funds to purchase the potentially most collectible of defaults 
from lenders and aggressively seek repayment for at least 9 
months before being eligible to file for Federal reinsurance. 
Currently guaranty agencies file for Federal reinsurance within 
45 days of paying an insurance claim from a lender. This 
requirement to ``work'' the defaulted loans for a longer period 
is estimated to reduce subsidy costs by about $1.0 billion over 
the projection period.
    Interactions Among the Provisions. Because the various 
proposed changes in the student loan programs have significant 
interactions, the total savings from all of the provisions 
together does not equal the sum of the individual components. 
For example, the proposal would eliminate the Federal subsidy 
to schools and alternate loan originators for loan origination 
fees under the direct loan program. By itself, this change 
would reduce Federal costs by $880 million over 7 years. 
Because the proposal would eliminate the direct loan program, 
however, eliminating this particular subsidy would produce no 
additional savings.
    When all of the provisions are considered together, the 
interactions increase the savings by $5 million in 1996 and 
$555 million through 2002. This is the net effect of all of the 
changes, some of which increase Federal costs and of others 
which decrease costs.

Connie Lee

    This bill would repeal the law that established the College 
Construction Loan Insurance Association [Connie Lee] and would 
mandate the Secretary of the Treasury to make every effort to 
sell the government's stock--which currently is not being 
publicly traded--within 6 months of enactment. If the Secretary 
is unable to sell the stock for an acceptable price, then the 
newly privatized Connie Lee must purchase the stock at a price 
determined by the Secretary based on a independent appraisal 
and acceptable to the Corporation except that the price shall 
not exceed the value of the stock as determined by CBO in its 
estimate of June 20, 1995. Connie Lee is a GSE established in 
1987 to provide loan guarantees for college construction 
projects. There are currently no on-budget Federal costs for 
the GSE.
    The government owns 1,914,800 shares of Connie Lee stock 
from its initial investment of $19.1 million in 1987. In its 
estimate of H.R. 1720 prepared on June 20, 1995, CBO estimated 
that the proceeds from the sale of the Connie Lee stock would 
be approximately $7 million. That estimate was based on an 
analysis that examined Connie Lee's return on equity and 
potential price-earnings ratio compared to those of other 
financial guaranty companies that are publicly traded, making 
adjustments for Connie Lee's lower credit quality and the fact 
that its stock is not a liquid asset.

Repeal of the Davis-Bacon and Service Contract Acts

    Two construction accounts are subject to the Davis-Bacon 
Act requirements are considered to be direct spending. They are 
the United States Enrichment Corporation and the Bonneville 
Power Administration. In these two programs, repealing Davis-
Bacon would save $1 million in fiscal year 1996 and $28 million 
over the 1996-2002 period. The estimated savings are the net 
effect of reduced construction spending and reduced receipts, 
because the affected agencies are required to establish power 
rates consistent with changes in their operating costs. Because 
changes in capital costs are amortized into the rate structures 
over a 15-year to 20-year period, the long-term effect on 
mandatory spending of repealing the Davis-Bacon Act would be 
negligible. The authorizations of appropriations shown for the 
repeal of the Davis-Bacon Act in table 3 represent estimated 
obligational authority, which includes estimates of 
appropriated budget authority as well as estimated obligations 
from certain transportation trust funds, which are not 
considered budget authority.

       TABLE 3. BUDGETARY IMPACT OF REPEALING THE DAVIS-BACON AND SERVICE CONTRACT ACTS--AUTHORIZATIONS OF      
                                                 APPROPRIATIONS                                                 
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                              1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
Estimated Savings from Repeal of the Davis-                                                                     
 Bacon Act:                                                                                                     
    Estimated Authorization of                                                                                  
     Appropriations.......................      -614      -841      -868      -893      -923      -952      -981
    Estimated Outlays.....................      -117      -365      -558      -685      -786      -819      -849
Estimated Savings from Repeal of the                                                                            
 Service Contract Act:                                                                                          
    Estimated Authorization of                                                                                  
     Appropriations.......................      -452      -621      -640      -659      -678      -699      -720
    Estimated Outlays.....................      -430      -612      -639      -658      -678      -698      -719
                                           ---------------------------------------------------------------------
      Total:..............................                                                                      
        Estimated Authorization of                                                                              
         Appropriations...................    -1,067    -1,462    -1,508    -1,552    -1,601    -1,651    -1,701
                                           =====================================================================
        Estimated Outlays.................      -547      -978    -1,198    -1,343    -1,464    -1,517    -1,568
----------------------------------------------------------------------------------------------------------------

    Repeal of the Davis-Bacon Act. The requirements of the 
Davis-Bacon Act [DBA] affect contracts on Federal construction 
or federally assisted construction of $2,000 or more, without 
regard to the nature of the project. Currently, the Department 
of Labor makes its wage determinations based on the specific 
wages and benefits earned by at least 50 percent of workers in 
a classification, or on the weighted average of the wages and 
benefits paid to workers in that classification. The former 
method tends to be used in heavily unionized construction 
markets, and the latter in less unionized settings.
    A Congressional Budget Office [CBO] study in 1983 estimated 
that the requirements of the DBA increase Federal construction 
costs by 3.7 percent. This estimate was based on a method of 
determining prevailing wages called the ``30 percent rule.'' 
When the 30-percent rule was changed to the currently used 
``majority wage'' calculations, CBO revised its estimate to 3.3 
percent. The 3.3 percent estimate also included the effects of 
certain restrictions on the use of helpers, which contributed 
1.6 percentage points of the total effects of the DBA. Since 
that time, a Federal Court of Appeals has ruled that the 
Department of Labor could impose regulations designating 
helpers as a separate class of workers, which effectively would 
eliminate the DBA restriction on helpers. Although the fiscal 
year 1995 appropriations bill for the Department prohibited the 
Secretary from using any funds under that act to implement the 
new helper regulations, the prohibition expires with the 1995 
funds themselves. Therefore, CBO estimates that the DBA will 
increase Federal construction costs for contracts left after 
1995 by 1.7 percent. A repeal of the DBA would allow for a 
reduction in Federal outlays of $117 million in fiscal year 
1996 and $4.2 billion over the next 7 years, if appropriations 
are reduced accordingly.
    Any estimate of the cost implications of the DBA is 
uncertain. Very little empirical work has been published on the 
subject since CBO's 1983 report, and even then there was little 
consensus as to the precise cost impacts. At the time, CBO's 
estimate was toward the low end of the range of estimated 
impacts, which stretched from 0.1 percent in a study by Steven 
Allen of North Carolina State University to as much as 11 
percent in a study by President Carter's Council of Economic 
Advisers.
    Trends since 1983 give conflicting indications as to 
possible changes in the impact of the DBA. For example, fewer 
construction workers are represented by unions--21.0 percent in 
1993, compared with 29.4 percent in 1983. As a result, union 
wages could have less of an impact in the determination of a 
prevailing wage, thereby lessening the impact of the DBA on 
Federal construction costs. Furthermore, the wage differential 
between union and nonunion construction workers has declined in 
the past decade. The ratio of cash wages for union construction 
workers to those for nonunion construction workers was 1.62 in 
1993, as compared with 1.72 in 1983.
    However, the cash wage ratio does not account for fringe 
benefits, which are also covered by the requirements of the 
DBA. While the wage differential may have declined, the 
difference between total compensation--including fringe 
benefits like health insurance--received by union and nonunion 
construction workers may have grown. Unfortunately, there is no 
continuous data series for total compensation of construction 
workers. The first year that wage and compensation data are 
available for blue collar workers is 1987, but these data cover 
all blue collar workers, of which construction workers are a 
subset. CBO's 1983 report was based on 1979 figures, which 
indicated that the ratio of the total compensation for union 
construction workers to that of nonunion workers was 1.54. The 
corresponding ratio for blue collar workers (of which 
construction workers are a subset) was 1.74 in 1994, the same 
level as in 1987.
    Finally, the data discussed above apply to a broad spectrum 
of construction or blue collar workers, while much of the 
Federal construction funding is for highways. Whether broad 
trends are indicative of the compensation patterns in highway 
construction is uncertain. Thus, relevant data are sparse, the 
broad trends are ambiguous, and the applicability of the 
available information to estimating the impact of the DBA is 
uncertain. Therefore, although we have made minor changes to 
our method for estimating the Federal cost impacts of the DBA, 
in the absence of any clear evidence to contradict the results 
of the 1983 report, CBO has based this estimate on the findings 
indicated in its 1983 study.
    CBO projects spending authority for Federal or federally 
financed construction to grow from about $48 billion in 1996 to 
about $58 billion by 2002. The largest percentage of Federal 
construction spending is for transportation programs, at $22.7 
billion in spending authority for fiscal year 1996, or about 47 
percent of the total. This amount includes spending from the 
Highway Trust Fund, the Airport and Airway Trust Fund, the 
Harbor Maintenance Trust Fund, and the Inland Waterways Trust 
Fund. Other major areas of construction spending are natural 
resources and environment ($8.4 billion), national defense 
($6.0 billion), and income security ($4.7 billion). 
Construction outlays tend to flow slowly from spending 
authority. Accordingly, outlays from new spending authority in 
fiscal year 1996 are expected to be approximately $8.8 billion, 
including $3.3 billion for transportation, $0.7 billion for 
defense, and $3.5 billion for natural resources and 
environment. Fiscal year 1996 construction authority in the 
income security function is not reflected in outlays until 
fiscal year 1997 and subsequent years. The estimated savings 
from repeal of the Davis-Bacon Act are 1.7 percent of these 
amounts.
    Repeal of the Service Contract Act. The McNamara-O'Hara 
Service Contract Act [SCA] was enacted in 1965 to require that 
contractors providing services to the Federal Government--for 
example janitorial, laundry, security, or data-processing 
functions--pay wages and fringe benefits that are prevailing in 
the area where the services are supplied. Similar to the 
procedures under the Davis-Bacon Act, the Department of Labor 
conducts wage surveys in different areas of the country to 
determine the distribution of wages and fringe benefits and to 
determine the prevailing practices in particular areas. The 
prevailing wage is generally established at the average wage in 
the area for each class of worker, and Federal contractors must 
pay workers at or above the prevailing wage.
    According to the Department of Labor, a review of wage 
rates in a number of different areas and occupations indicated 
that the requirement to pay prevailing wages raised wage rates 
an average of 4.17 percent (See Federal Register, August 14, 
1981, p. 41383). In this estimate CBO has reduced this factor 
to 3.0 percent to reflect the fact that labor costs are not the 
only costs covered within these contracts. In the absence of 
any clear evidence as to the direction and magnitude of the 
changes in the services industry (particularly services for 
which the Federal Government contracts with private 
enterprises), CBO has continued to use the same assumptions for 
estimating the cost of repealing the SCA since the late 1980's.
    CBO projects that the volume of services covered under the 
SCA will grow from its 1994 level of about $19 billion to over 
$24 billion in 2002. Consequently, CBO estimates that repeal of 
the SCA would reduce Federal contracting costs by about $0.5 
billion in 1996 and $4.4 billion over the 1996-2002 period.

Employee Retirement Income Security Act

    This bill would amend ERISA to provide that the 30-day 
minimum waiting period between the date an explanation of the 
joint and survivor annuity is provided and the annuity starts 
may be waived by the participant. This waiver would cause a 
slight acceleration in distribution of qualified plans. The 
Joint Committee on Taxation estimates that this provision would 
have negligible revenue effects. CBO concurs with the estimate.
    6. Estimated cost to State and local government: The 
reconciliation recommendations of the House Economic and 
Educational Opportunities Committee are likely to have a number 
of offsetting effects on the finances of State and local 
governments. The net impact of these effects cannot be 
quantified at this time.
    Changes in the student loan programs would affect most 
colleges and universities. Many of these institutions are 
public and receive some financial assistance from State 
governments, so that some of these effects could be borne by 
State governments. To the extent the changes make student loans 
more expensive to borrowers, total enrollments and the 
distribution of enrollments among private and public schools 
could change. How the institutions of higher learning cope with 
these changes may determine whether State and local governments 
would choose to alter their contributions to the schools 
presently receiving governmental support.
    The recommendations to repeal the Davis-Bacon Act would 
have some impact on construction costs for State and local 
governments. Many projects involving State and local matching 
funds would become less costly under this proposal, although 
the impact would vary considerably by State. Currently, 18 
States do not have their own prevailing wage laws affecting 
construction activities. In those States, we expect that 
repealing Davis-Bacon would reduce costs on virtually all 
projects involving Federal funds. The States with prevailing 
wage laws applying to construction often differ in a variety of 
ways including the minimum contract size for which the 
prevailing wage laws are binding, making it difficult to 
estimate the impact of changes in the Federal law. (The minimum 
contract thresholds range from $0 to $600,000.) Moreover, the 
definitions of prevailing wages, reporting requirements, and 
other matters also may differ. While repeal of Davis-Bacon is 
likely to benefit State and local governments in general, CBO 
is unable to estimate the total impact of repeal.
    7. Estimate comparison: On April 21, 1995, CBO prepared a 
cost estimates for H.R. 500 and S.141, both bills would have 
repealed the Davis-Bacon Act. At the time, CBO did not estimate 
any effect on direct spending from the repeal of the DBA.
    8. Previous CBO estimate: None.
    9. Estimate prepared by: Deborah Kalcevic, student loans; 
Christina Hawley, Davis-Bacon and Service Contract Acts; and 
Marc Nicole, State and local.
    10. Estimate approved by: Paul Van de Water, Assistant 
Director for Budget Analysis.

                         HOUSE COMMITTEE ON ECONOMIC AND EDUCATION OPPORTUNITIES, STUDENT LOAN PROGRAM RECONCILIATION PROVISIONS                        
                                                        [By fiscal year, in millions of dollars]                                                        
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                                                                               1996-2002
                                                          1995       1996       1997       1998       1999       2000       2001       2002      total  
--------------------------------------------------------------------------------------------------------------------------------------------------------
Change the phase-in of the direct loan program from                                                                                                     
 50 percent to 0 percent of total student and parent                                                                                                    
 loan volume for academic year 1996-97 and 1997-98                                                                                                      
 and from 60 percent to 0 percent for academic year                                                                                                     
 1998-99 and all years thereafter. (Assumes all new                                                                                                     
 loans affected):                                                                                                                                       
    Budget authority.................................  .........       -140         90        -35       -220       -220       -230       -245     -1,000
    Outlays..........................................  .........        -80         30         15       -145       -215       -225       -235       -855
Change the annual budget authority levels for the                                                                                                       
 section 458 direct loan administrative cost                                                                                                            
 mandatory spending account from $550 million to $110                                                                                                   
 million in 1996, from $595 million to $24 million in                                                                                                   
 1997 (assuming the use of $46 million in unobligated                                                                                                   
 funds from 1994 levels to fund 1997 obligations                                                                                                        
 totaling $70 million), and from $750 million to $70                                                                                                    
 million in 1998. For 1999 through 2002 the levels                                                                                                      
 would be $70 million each year. The cumulative $2.5                                                                                                    
 billion spending limit for 1994-98 would be                                                                                                            
 eliminated:                                                                                                                                            
    Budget authority.................................  .........       -269       -264       -265       -253       -221       -221       -221     -1,714
    Outlays..........................................  .........       -198       -251       -261       -248       -229       -224       -222     -1,633
Eliminate the Federal interest subsidy on subsidized                                                                                                    
 guaranteed and direct loans during the 6-month grace                                                                                                   
 period prior to the beginning of loan repayment. As                                                                                                    
 with unsubsidized loans, interest could be accrued                                                                                                     
 and capitalized during this period. (Assumes all new                                                                                                   
 loans affected):                                                                                                                                       
    Budget authority.................................  .........       -365       -525       -555       -590       -615       -645       -680     -3,975
    Outlays..........................................  .........       -245       -475       -545       -575       -610       -635       -670     -3,755
Increase the PLUS loan interest rate to the 365-day                                                                                                     
 treasury rate plus 4.0 percent and cap it at 11                                                                                                        
 percent. In the guaranteed program 1.6 percentage                                                                                                      
 points of the interest income would be rebated to                                                                                                      
 the government to offset program costs. Currently                                                                                                      
 the interest rates are the 365-day treasury rate                                                                                                       
 plus 3.1 percent capped at 9 percent prior to July                                                                                                     
 1998 and the comparable maturity rate (10-year bond                                                                                                    
 rate) plus 2.1 percent capped at 9 percent as of                                                                                                       
 July 1998. (Assumes all new loans affected):                                                                                                           
    Budget authority.................................  .........        -95       -125       -125       -120       -135       -145       -150       -895
    Outlays..........................................  .........        -90       -125       -125       -120       -135       -145       -150       -890
Lower the annual borrowing levels for PLUS loans to                                                                                                     
 $15,000 per student. Currently, there is no annual                                                                                                     
 borrowing limit on PLUS loans although borrowing is                                                                                                    
 limited to the student's calculated cost of                                                                                                            
 attendance. (Assumes all new loans affected):                                                                                                          
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
Lower the Federal share of the lender origination fee                                                                                                   
 on guaranteed loans, including consolidation loans,                                                                                                    
 from 0.5 percent to 0.3 percent but increase the                                                                                                       
 overall lender fee to 1.0 percent and give 0.7                                                                                                         
 percent to guaranty agencies. (Assumes all new loans                                                                                                   
 including new consolidation loans affected):                                                                                                           
    Budget authority.................................  .........         40         35         35         30         35         35         35        245
    Outlays..........................................  .........         30         35         35         30         35         35         35        235
Reduce the loan guarantee on all loans including                                                                                                        
 loans made by lenders with exceptional performance--                                                                                                   
 except exclude loans made as lender-of-last-resort--                                                                                                   
 from 98 percent to 95 percent. (Assumes all new                                                                                                        
 loans affected):                                                                                                                                       
    Budget authority.................................  .........        -30        -40        -40        -40        -40        -40        -45       -275
    Outlays..........................................  .........        -20        -40        -40        -40        -40        -40        -40       -260
Impose a 0.20 percent lender transfer fee on the                                                                                                        
 outstanding principal value of a loan each time a                                                                                                      
 loan is transferred from one lender to another.                                                                                                        
 (Assumes both old and new loans affected):                                                                                                             
    Budget authority.................................  .........        -70        -20        -15        -15        -15        -20        -20       -175
    Outlays..........................................  .........        -65        -20        -15        -15        -15        -20        -20       -170
Reduce the Federal reinsurance on all loans including                                                                                                   
 those insured by guaranty agencies with exceptional                                                                                                    
 performance from 98/88/78 percentages to 96/86/76                                                                                                      
 percentages except exclude those made as lender-of-                                                                                                    
 last-resort. (Assumes all new loans affected):                                                                                                         
    Budget authority.................................  .........        -20        -30        -30        -25        -25        -30        -30       -190
    Outlays..........................................  .........        -15        -25        -30        -25        -25        -30        -30       -180
Eliminate supplemental preclaim payments to guaranty                                                                                                    
 agencies which equal 1 percent of the principal and                                                                                                    
 interest of loans for which assistance was provided                                                                                                    
 lenders, and the lenders did not file a default                                                                                                        
 claim on or before the 390th day from deliquency.                                                                                                      
 (Assumes both outstanding and new loans affected):                                                                                                     
    Budget authority.................................  .........       -115        -25        -25        -25        -20        -25        -25       -260
    Outlays..........................................  .........       -105        -25        -25        -25        -25        -25        -25       -255
Keep the time before lenders may file for an                                                                                                            
 insurance claim at 180 days from delinquency.                                                                                                          
 However, increase the time before guaranty agencies                                                                                                    
 may file for reinsurance from the Federal Government                                                                                                   
 to 360 days from deliquency, except for documented                                                                                                     
 uncollectable loans which could be filed prior to                                                                                                      
 360 days. (Assumes both outstanding and new loans                                                                                                      
 affected):                                                                                                                                             
    Budget authority.................................  .........       -590        -80        -75        -70        -75        -80        -85     -1,055
    Outlays..........................................  .........       -560        -80        -80        -75        -75        -80        -80     -1,030
Change the provisions governing the guaranty agencies                                                                                                   
 and their reserve funds by changing the standards                                                                                                      
 for mandatory assignment, clarifying the uses of the                                                                                                   
 reserve funds, and limiting the Secretary's                                                                                                            
 authority to the Federal portion of the reserve                                                                                                        
 funds:                                                                                                                                                 
    Budget authority.................................  .........  .........  .........  .........  .........  .........  .........  .........  .........
    Outlays..........................................  .........  .........  .........  .........  .........  .........  .........  .........  .........
Include as eligible guaranteed loan program lenders                                                                                                     
 any wholly owned subsidiaries of publicly held                                                                                                         
 holding companies which, as of the enactment date,                                                                                                     
 act as finance companies. (Assumes new loans                                                                                                           
 affected):                                                                                                                                             
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
When determining a holder's primary consumer credit                                                                                                     
 function exempt any loans held as trustee or in a                                                                                                      
 trust capacity for the benefit of a third party.                                                                                                       
 (Assumes new loans affected):                                                                                                                          
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
Change the requirement for lender-of-last resort                                                                                                        
 [LLR] loans. Borrowers would only have to have one                                                                                                     
 lender refusal to be eligible for an LLR loan and                                                                                                      
 all LLR applications must be processed within 15                                                                                                       
 days. Currently borrowers must have two lender                                                                                                         
 refusals and the process can take 30 days. (Assumes                                                                                                    
 all new loans affected):                                                                                                                               
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
Exempt lenders with less than $5 million in student                                                                                                     
 loan holdings from the annual audit requirements:                                                                                                      
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
Amend the current definition of eligible proprietary                                                                                                    
 school revenue sources. Under current law,                                                                                                             
 proprietary schools must have at least 15 percent of                                                                                                   
 their campus-based, instructional-based revenues                                                                                                       
 come from non-Federal student aid sources (a.k.a. 85/                                                                                                  
 15 rule). This proposal would allow proprietary                                                                                                        
 schools not only to include in their calculated                                                                                                        
 revenue base the campus-based instructional-based                                                                                                      
 resources but also revenues from training programs                                                                                                     
 provided on a contractural basis under Federal,                                                                                                        
 State, or local programs or with business and                                                                                                          
 industry. (Assumes all new loans affected):                                                                                                            
    Budget authority.................................  .........  .........  .........  .........  .........  .........  .........  .........  .........
    Outlays..........................................  .........  .........  .........  .........  .........  .........  .........  .........  .........
Allow student loan borrowers with direct student                                                                                                        
 loans the option to consolidate any direct loans                                                                                                       
 into a guaranteed consolidated loan. (Assumes both                                                                                                     
 outstanding and new loans affected):                                                                                                                   
    Budget authority.................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
    Outlays..........................................  .........        (*)        (*)        (*)        (*)        (*)        (*)        (*)        (*)
Eliminate the authority for the Secretary of                                                                                                            
 Education to offer direct consolidation loans to                                                                                                       
 current and future guaranteed student loan                                                                                                             
 borrowers. (Assumes both outstanding and new loans                                                                                                     
 affected):                                                                                                                                             
    Budget authority.................................  .........         10        (*)          5         10        (*)        (*)        (*)         25
    Outlays..........................................  .........          5         -5          5         10          5        (*)        (*)         20
Eliminate the Federal subsidy to schools (and                                                                                                           
 alternate originators) for a loan origination fee.                                                                                                     
 This fee is set at $10 for school originators for                                                                                                      
 academic year 1994-95 is assumed to be adjusted by                                                                                                     
 the Secretary in the outyears and set by contract                                                                                                      
 for alternate originators. (Assumes all new loans                                                                                                      
 affected):                                                                                                                                             
    Budget authority.................................  .........        -70       -110       -125       -150       -155       -160       -170       -940
    Outlays..........................................  .........        -45        -95       -120       -140       -150       -160       -170       -880
Net programmatic interactions among all program                                                                                                         
 changes listed above:                                                                                                                                  
    Budget authority.................................  .........          5        -50        -80        -85       -115       -110       -110       -545
    Outlays..........................................  .........         -5        -50        -75        -95       -110       -105       -115       -555
                                                      --------------------------------------------------------------------------------------------------
      Total changes including programmatic                                                                                                              
       interactions:                                                                                                                                    
        Budget authority.............................  .........     -1,709     -1,144     -1,330     -1,553     -1,601     -1,671     -1,746    -10,754
                                                      ==================================================================================================
        Outlays......................................  .........     -1,393     -1,126     -1,261     -1,463     -1,589     -1,654     -1,722    -10,208
--------------------------------------------------------------------------------------------------------------------------------------------------------
* Insignificant costs.                                                                                                                                  
                                                                                                                                                        
Notes:                                                                                                                                                  
1. Estimates use the programmatic and economic assumptions of the budget resolution and assume enactment by November 15, 1995, and implementation on    
  January 1, 1996, unless otherwise noted.                                                                                                              
2. Each proposed program change listed is estimated separately from the resolution baseline. The net programmatic interactions take into account all the
  proposed changes simultaneously. The calculated interactions among the various subcomponents of the proposal may be significantly different.          
3. For most years of the life of loans disbursed between 1995 and 2000, the CBO projection for the fiscal-year average 91-day Treasury bill discount    
  rate is 5.1 percent. The rate used to discount the cash flows is the CBO projection of the 10-year Treasury bond rate, which ranged between 7.8       
  percent in 1995 to 6.7 percent in 2000 and beyond.                                                                                                    
4. For the resolution baseline projections the direct administrative costs of the direct loan program are calculated on a net present value basis over  
  the life of the loan and included in the direct loan program account in the year the loans are disbursed. As a result of this change, the resolution  
  baseline projections assume that the current section 458 administrative cost capped mandatory levels have been adjusted downward to the budget        
  authority levels shown for the Direct Loan Mandatory Administrative Cost Account. All estimates of programmatic changes to section 458 are calculated 
  relative to the section 458 levels assumed in the budget resolution.                                                                                  

  Statement of Oversight Findings and Recommendations of the Committee

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives and clause 2(b)(1) of 
rule X of the Rules of the House of Representatives, the 
committee's oversight findings and recommendations are 
reflected in the body of this report.

                     Inflationary Impact Statement

    In compliance with clause 2(l)(4) of rule XI of the Rules 
of the House of Representatives, the committee estimates that 
the enactment into law of committees recommendations will have 
no inflationary impact on prices and costs in the operation of 
the national economy. It is the judgment of the committee that 
the inflationary impact of this legislation as a component of 
the Federal budget is negligible.

                    Government Reform and Oversight

    With respect to the requirement of clause 2(l)(3)(D) of 
rule XI of the Rules of the House of Representatives, the 
committee has received no report of oversight findings and 
recommendations from the Committee on Government Reform and 
Oversight on the subject of the committee's recommendations.

                           Committee Estimate

    Clause 7 of rule XIII of the Rules of the House of 
Representatives requires an estimate and a comparison by the 
committee of the costs which would be incurred in carrying out 
the committee's recommendations. However, clause 7(d) of that 
rule provides that this requirement does not apply when the 
committee has included in its report a timely submitted cost 
estimate of the bill prepared by the Director of the 
Congressional Budget Office under section 403 of the 
Congressional Budget Act of 1974.

                Application of Law to Legislative Branch

    Section 102(b)(3) of Public Law 104-1 requires a 
description of the application of this bill to the legislative 
branch. To the extent that the statutes effected by these 
budget recommendations apply to Congress, these recommendations 
would also apply to Congress.

                       Unfunded Mandate Statement

    Section 423 of the Congressional Budget and Impoundment 
Control Act requires a statement of whether the provisions of 
the reported bill include unfunded mandates; the bill does not 
contain any unfunded mandates.
             TITLE VI--COMMITTEE ON INTERNATIONAL RELATIONS

                          House of Representatives,
                      Committee on International Relations,
                                Washington, DC, September 28, 1995.
Hon. John Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear John: I have the honor to transmit to you, with this 
letter, the recommendations of the Committee on International 
Relations adopted in response to the instructions of the House 
as part of the concurrent resolution on the budget.
    It has been a pleasure to work with you during the stages 
leading up the great challenge now before us: the adoption of 
the reconciliation bill.
    Good luck in the days ahead. You may be assured of my 
continued support.
    With best wishes,
            Sincerely,
                                        Benjamin A. Gilman,
                                                          Chairman.
    Enclosures.

                           table of contents

                                                                   Page
Transmittal letter...............................................   419
Purpose and summary..............................................   419
Hearings.........................................................   420
Section-by-section analysis......................................   421
Changes in existing law..........................................   433
Congressional Budget Office estimate.............................   524
Committee oversight findings.....................................   526
Committee on Government Reform and Oversight findings............   526

        Purpose and Summary--Background and Need for Legislation

Sec. 6001. Recovery of costs of health care services for personnel of 
        the Foreign Service of the United States and other eligible 
        individuals

    The committee adopted section 6001, relating to the 
recovery of the cost of health care services, first, because it 
had been approved, in a slightly different form, by the 
committee during its consideration of Division B of H.R. 1561, 
the American Overseas Interests Act, and by the House when it 
passed H.R. 1561 on June 8, 1995.
    Second, section 6001 results in savings equal to those 
required of the committee under its budget reconciliation 
instructions. Section 6001, when adopted as section 2353 of 
H.R. 1561, had provided that the funds raised would be directed 
to any Department of State account, subject to appropriations. 
Section 6001, in contrast, directs that those funds be 
deposited in the Treasury as a miscellaneous offsetting 
receipt. The effective date of section 6001 is its date of 
enactment, whereas the effective date of section 2353 of H.R. 
1561 was October 1, 1996.
    The Committee on International Relations customarily 
achieves its reconciliation savings by mirroring changes made 
in the civil service retirement system in the major direct 
spending program under its jurisdiction, the Foreign Service 
retirement system. Because at the time it acted there was no 
consensus on the appropriate changes to be made in the civil 
service retirement system the committee felt it appropriate to 
put forward this provision as an alternative, so as to be in 
compliance with the instructions contained in the budget 
resolution.

Sec. 6002. Enactment by reference of Division A of H.R. 1561

    Division A of H.R. 1561, the Foreign Affairs Agencies 
Consolidation Act of 1995 reforms the foreign affairs 
institutions that have grown up over the last 40 years and 
adapts them to the requirements of the post-cold war era.
    Division A abolishes three agencies that effectively 
promoted U.S. interests during the cold war--the Arms Control 
and Disarmament Agency, the U.S. Information Agency, and the 
Agency for International Development--but whose functions can 
now be carried out more efficiently by a strengthened and 
reorganized Department of State. The consolidation of these 
agencies into the Department of State will improve the 
coordination of U.S. foreign policy under the leadership of the 
Secretary of State. It will also facilitate a more rational 
downsizing of the foreign affairs budget by encouraging 
elimination of overlapping and obsolete functions.
    Division A seeks to provide maximum flexibility to the 
executive branch to carry out the consolidation of foreign 
affairs agencies and the reorganization of the Department of 
State. By resisting the temptation to dictate the precise 
structure that is to emerge from the reorganization, the 
committee intends to engage the expertise of the executive 
branch in the reorganization and downsizing process.

                                Hearings

    In the context of the committee's work on the American 
Overseas Interests Act, Division A of which is included in the 
committee's reconciliation recommendations, the committee held 
the following hearings:
    On April 4, l995, the full committee held a hearing on 
consolidation of the foreign affairs agencies.
    Witnesses for this hearing included: Under Secretary 
Richard Moose, Department of State; Administrator Brian Atwood, 
Agency for International Development; Director Joseph Duffy, 
U.S. Information Agency; and Director John Holum, Arms Control 
and Disarmament Agency.
    On May 9, 1995, the full committee held a hearing on H.R. 
1561, with particular emphasis on consolidation of the foreign 
affairs agencies.
    Witnesses for this hearing included: Under Secretary 
Richard Moose, Department of State; Administrator Brian Atwood, 
Agency for International Development; Director Joseph Duffy, 
U.S. Information Agency; and Deputy Director Ralph Earle II, 
U.S. Arms Control and Disarmament Agency

                      Section-by-Section Analysis

Sec. 6001. Recovery of costs of health care services for personnel of 
        the Foreign Service of the United States and other eligible 
        individuals

    This section amends section 904 of the Foreign Service Act 
of 1980 to authorize the Department of State to recover the 
costs incurred by the Department for health care services 
provided to eligible employees and their families and to other 
eligible individuals. This would permit the Department to 
recover such costs from third-party payers. In addition, the 
Department would be able to collect fees from other persons who 
are provided care in Department facilities.
    The Department's estimate of operating costs for overseas 
health units for fiscal year 1993 was approximately $19 million 
(including salaries, post entitlements, regional medical 
officer travel, and prescription medicines) and the Department 
contributes over $15 million per year toward health insurance 
premiums for insurance that is not consistently used by its 
overseas employees. This provision would rectify this 
situation, and follows up on a recommendation by the inspector 
general of the Department of State.
    Section 6001(a)(1) amends section 904(a) of the Foreign 
Service Act to permit the Secretary to designate certain 
persons who are not U.S. Government employees or family members 
to receive health care services abroad on a fee-for-service 
basis.
    Section 6001(a)(2) amends section 904(d) of the Foreign 
Service Act, which authorizes the Secretary to pay the cost of 
medical treatment for eligible individuals. The proposed 
amendment would make section 904(d) subject to a new fee-for-
service program described in new subsections 904 (g) and (h).
    Section 6001(a)(3) adds new subsections (g) and (h) of 
section 904 of the Foreign Service Act, as described below.
    Paragraph (1) of subsection (g) authorizes the Department 
to recover the cost of health care services incurred by the 
Department from third-party payers to the same extent that the 
covered beneficiary would be eligible to receive reimbursement 
from the third-party payer for such expenses.
    Paragraphs (2) and (3) of subsection (g) provide that if 
the insurance contract requires a deductible or copayment, the 
Department absorbs that cost so that neither a covered employee 
nor the third-party payer is required to pay the deductible or 
copayment amount.
    Paragraphs (4) and (5) of subsection (g) recognize the 
unique circumstances at Government health care facilities at 
posts abroad. Paragraph (4) would prohibit third-party payers 
from refusing to reimburse the Department based on provisions 
in the insurance contact excluding from coverage care provided 
by a government entity, to an individual who is not required to 
pay a deductible or copayment or by a provider with which the 
third-party payer has no participation agreement. Paragraph (5) 
provides that no contractual provision can prevent recovery by 
the United States under this section. This provision will 
insure coverage for care provided by registered nurses, whether 
or not they are under the direct supervision of a physician.
    Paragraph (6) of subsection (g) subrogates the United 
States to the beneficiary's rights against the third-party 
payer.
    Paragraphs (7) and (8) of subsection (g) direct the 
Secretary to prescribe regulations for the implementation of 
these subsections, including regulations regarding the 
computation of reasonable costs of health services. A third-
party payer is permitted to review an employee's health records 
to verify that the care for which reimbursement is sought was 
provided, and to verify that the care meets the criteria of the 
insurance contract (except for those criteria affected by 
paragraphs (2) and (4) of subsection (g)).
    Paragraph (9) of subsection (g) requires that Department to 
deposit any amounts collected under subsections (g) or (h) of 
section 904 in the Treasury as a miscellaneous offsetting 
receipt.
    Paragraph (10) of subsection (g) defines terms ``covered 
beneficiary'', ``services'', and ``third party payer''.
    Section 904(h) provides that in the case of a person who is 
not a ``covered beneficiary'' as that term is used in this 
section, but for whom the Department incurs costs for health 
care services, the Department may collect the reasonable costs 
of services provided, and may take appropriate legal actions to 
settle claims.
    Section 6001(b) provides that the authorities of the 
section shall be effective beginning on the date of enactment 
of the section.
    As the authorities granted by this section are 
discretionary, the Secretary need not exercise them 
immediately, but should exercise them as soon as practicable so 
as to generate the greatest possible savings to the Government.

Sec. 6002. Enactment into law of Division A of H.R. 1561

    This section enacts into law Division A of H.R. 1561 of the 
104th Congress, as passed by the House of Representatives on 
June 8, 1995. H.R. 1561 is described in more detail below.

                      TITLE I--GENERAL PROVISIONS

Sec. 101--Short title

    Sets forth the short title of this division, the ``Foreign 
Affairs Agencies Consolidation Act of 1995.''

Sec. 102--Congressional findings

    Sets forth congressional findings that the United States 
must remain engaged in international affairs; that the U.S. 
budget deficit requires streamlining of government programs and 
activities, including foreign programs and activities; and 
that, as part of the downsizing of the international affairs 
budget, the proliferation of foreign affairs agencies that 
occurred during the cold war must be reversed and the 
leadership of the Secretary of State strengthened.

Sec. 103--Purposes

    States that the purposes of the division are to consolidate 
and reinvent the foreign affairs agencies of the United States 
within the Department of State; provide for the reorganization 
of the Department of State; strengthen the coordination of U.S. 
foreign policy; and to abolish not later than March 1, 1997, 
the U.S. Arms Control and Disarmament Agency [ACDA], the U.S. 
Information Agency [USIA], the International Development 
Cooperation Agency, and the Agency for International 
Development [AID].

Sec. 104--Definitions

    Defines terms used within this division.

      TITLE II--UNITED STATES ARMS CONTROL AND DISARMAMENT AGENCY

                     CHAPTER 1--GENERAL PROVISIONS

Sec. 201--Effective date

    Provides that the amendments made by this title (other than 
section 221) shall take effect on March 1, 1997, or on an 
earlier date announced by the President in the Federal 
Register, which date may be not earlier than 60 calendar days 
(excluding any days on which either House of Congress is not in 
session because of a sine die adjournment) after the President 
has submitted a reorganization plan to the appropriate 
committees of Congress pursuant to section 221. Section 221 
shall take effect on the date of enactment.

Sec. 202--References in title

    States that, except as otherwise provided, the references 
in this title to provisions of law shall be considered 
references to the Arms Control and Disarmament Act.

  CHAPTER 2--ABOLITION OF UNITED STATES ARMS CONTROL AND DISARMAMENT 
         AGENCY AND TRANSFER OF FUNCTIONS TO SECRETARY OF STATE

Sec. 211--Abolition of United States Arms Control and Disarmament 
        Agency

    Abolishes ACDA.

Sec. 212--Transfer of functions to Secretary of State

    Transfers to the Secretary of State all functions of the 
Director of ACDA and of ACDA.

CHAPTER 3--REORGANIZATION OF DEPARTMENT OF STATE RELATING TO FUNCTIONS 
                      TRANSFERRED UNDER THIS TITLE

Sec. 221--Reorganization plan

    Provides that, not later than March 1, 1996, the President, 
in consultation with the Secretary of State and the Director of 
ACDA, shall submit a reorganization plan to the appropriate 
committees of Congress. The plan is to provide for the 
abolition of ACDA; the transfer of ACDA's functions and 
personnel to the Department of State; and the consolidation, 
reorganization, and streamlining of the Department of State 
upon the transfer in order to carry out the transferred 
functions.
    The plan is to identify the functions of ACDA that are to 
be transferred; the personnel and positions of ACDA and the 
Department that are to be transferred, separated, or 
eliminated; specify the consolidations and reorganizations 
within the Department that will be required; specify the funds 
available to ACDA that will be transferred; specify the 
proposed allocations within the Department of unexpended funds 
that are to be transferred from ACDA; and specify the proposed 
disposition of the property, facilities, contracts, records, 
and other assets and liabilities of ACDA.
    The plan is to provide for an appropriate number of 
assistant secretaries of state to carry out the functions 
transferred to the Department.
    The committee notes that ACDA's single-mission focus has 
permitted the agency to develop over the years unique expertise 
and experience among its personnel in arms control matters. The 
Department of State has needed to develop similar expertise 
within the Bureau of Political-Military Affairs and elsewhere. 
However, the personnel system of the Department, which 
emphasizes the development of broad expertise among the 
Department's employees so as to equip them to effectively carry 
out the Department's many missions, has necessarily limited the 
Department's ability to match the training and experience in 
arms control matters that is found within ACDA.
    The committee believes that it would be detrimental to the 
interests of the United States for the expertise and experience 
of ACDA personnel to be lost as a result of the consolidation 
of ACDA with the Department of State. Accordingly, the 
committee would expect the reorganization plan submitted 
pursuant to section 221 to be designed, to the maximum extent 
feasible, to ensure that the unique expertise and experience of 
ACDA personnel is not lost to the U.S. Government as a result 
of the consolidation.

Sec. 222--Principal officers

    Amends the State Department Basic Authorities Act to 
establish the new position within the Department of State of 
Coordinator for Arms Control and Disarmament, with the rank and 
status of Ambassador-at-Large. The Coordinator heads the Bureau 
of Arms Control and Disarmament and reports directly to the 
Secretary of State. In addition, an amendment to the National 
Security Act of 1947 provides that the Coordinator shall serve 
as a statutory advisor to the National Security Council.
    A transition provision provides that the President is 
authorized to appoint as the Coordinator for Arms Control and 
Disarmament the Director of ACDA, or other officials of ACDA or 
the Department of State confirmed by the Senate, to serve in an 
acting capacity until the President nominates and the Senate 
confirms a permanent appointee.

                    CHAPTER 4--CONFORMING AMENDMENTS

Sec. 241--References

    Provides that any reference in any statute or other 
official document or proceeding to the Director of ACDA shall 
be deemed to refer to the Secretary of State, and any reference 
to ACDA shall be deemed to refer to the Department of State.

Sec. 242--Repeal of establishment of agency

    Repeals section 21 of the Arms Control and Disarmament Act 
(relating to the establishment of ACDA).

Sec. 243--Repeal of positions and offices

    Repeals provisions of the Arms Control and Disarmament Act 
establishing positions and offices within ACDA.

Sec. 244--Transfer of authorities and functions under the Arms Control 
        and Disarmament Act to the Secretary of State

    Transfers authorities and functions of ACDA and the 
Director of ACDA to the Department of State and to the 
Secretary of State.

Sec. 245--Conforming amendments

    Makes conforming amendments to other provisions of the Arms 
Control and Disarmament Act.

              TITLE III--UNITED STATES INFORMATION AGENCY

                     CHAPTER 1--GENERAL PROVISIONS

Sec. 301--Effective date

    Provides that the amendments made by this title (other than 
section 321) shall take effect on March 1, 1997, or on an 
earlier date announced by the President in the Federal 
Register, which date may be not earlier than 60 calendar days 
(excluding any days on which either House of Congress is not in 
session because of a sine die adjournment) after the President 
has submitted a reorganization plan to the appropriate 
committees of Congress pursuant to section 321. Section 321 
shall take effect on the date of enactment.

 CHAPTER 2--ABOLITION OF UNITED STATES INFORMATION AGENCY AND TRANSFER 
                   OF FUNCTIONS TO SECRETARY OF STATE

Sec. 311--Abolition of United States Information Agency

    Abolishes USIA.

Sec. 312--Transfer of functions to Secretary of State

    Transfers to the Secretary of State all functions of the 
Director of USIA and of USIA.

CHAPTER 3--REORGANIZATION OF DEPARTMENT OF STATE RELATING TO FUNCTIONS 
                      TRANSFERRED UNDER THIS TITLE

Sec. 321--Reorganization plan

    Provides that, not later than March 1, 1996, the President, 
in consultation with the Secretary of State and the Director of 
USIA, shall submit a reorganization plan to the appropriate 
committees of Congress. The plan is to provide for the 
abolition of USIA; the transfer of USIA's functions and 
personnel to the Department of State; and the consolidation, 
reorganization, and streamlining of the Department of State 
upon the transfer in order to carry out the transferred 
functions.
    The plan is to identify the functions of USIA that are to 
be transferred; the personnel and positions of USIA and the 
Department that are to be transferred, separated, or 
eliminated; specify the consolidations and reorganizations 
within the Department that will be required; specify the funds 
available to USIA that will be transferred; specify the 
proposed allocations within the Department of unexpended funds 
that are to be transferred from USIA; and specify the proposed 
disposition of the property, facilities, contracts, records, 
and other assets and liabilities of USIA.
    The plan is to provide for an appropriate number of 
Aassistant Secretaries of State to carry out the functions 
transferred to the Department.

Sec. 322--Principal officers

    Amends the State Department Basic Authorities Act to 
establish the new positions within the Department of State of 
Under Secretary for Public Diplomacy, Assistant Secretary for 
Academic Programs and Cultural Exchanges, and Assistant 
Secretary for Information, Policy, and Programs. Both Assistant 
Secretaries shall report to the Under Secretary.
    Transition provisions provide that the President is 
authorized to appoint to each of these positions the Director 
of USIA, or other officials of USIA or the Department of State 
confirmed by the Senate, to serve in an acting capacity until 
the President nominates and the Senate confirms permanent 
appointees.

                    CHAPTER 4--CONFORMING AMENDMENTS

Sec. 341--References

    Provides that any reference in any statute or other 
official document or proceeding to the Director of USIA shall 
be deemed to refer to the Secretary of State, and any reference 
to USIA shall be deemed to refer to the Department of State.

Sec. 342--Abolition of Office of Inspector General of the U.S. 
        Information Agency and transfer of functions to Office of 
        Inspector General of the Department of State

    Abolishes the Office of Inspector General of USIA, and 
transfers the functions of that Office to the Office of 
Inspector General of the Department of State.

Sec. 343--Amendments to title 5

    Makes conforming amendments to title 5 of the United States 
Code.

Sec. 344--Amendments to United States Information and Educational 
        Exchange Act of 1948

    Makes conforming amendments to the U.S. Information and 
Educational Exchange Act of 1948.

Sec. 345--Amendments to the Mutual Educational and Cultural Exchange 
        Act of 1961 (Fulbright-Hays Act)

    Makes conforming amendments to the Mutual Educational and 
Cultural Exchange Act of 1961.

Sec. 346--International broadcasting activities

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1994 and 1995, and to title 5 
of the United States Code.

Sec. 347--Television broadcasting to Cuba

    Makes conforming amendments to the Television Broadcasting 
to Cuba Act.

Sec. 348--Radio broadcasting to Cuba

    Makes conforming amendments to the Radio Broadcasting to 
Cuba Act.

Sec. 349--National endowment for democracy

    Makes conforming amendments to Public Law 98-164.

Sec. 350--United States Scholarship Program for Developing Countries

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1986 and 1987.

Sec. 351--Fascell Fellowship Board

    Makes conforming amendments to the Fascell Fellowship Act.

Sec. 352--National Security Education Board

    Makes conforming amendments to the Intelligence 
Authorization Act, fiscal year 1992.

Sec. 353--Center for Cultural and Technical Interchange Between North 
        and South

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1992 and 1993.

Sec. 354--East-West center

    Makes conforming amendments to the Mutual Security Act of 
1960.

Sec. 355--Mission of the Department of State

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal year 1979.

Sec. 356--Consolidation of administrative services

    Makes conforming amendments to the State Department Basic 
Authorities Act of 1956.

Sec. 357--Grants

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1992 and 1993.

Sec. 358--Ban on domestic activities

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1986 and 1987.

Sec. 359--Conforming repeal to the Arms Control and Disarmament Act

    Makes conforming amendment to the Arms Control and 
Disarmament Act.

Sec. 360--Repeal relating to procurement of legal services

    Makes conforming amendment to the State Department Basic 
Authorities Act of 1956.

Sec. 361--Repeal relating to payment of subsistence expenses

    Makes conforming amendment to the State Department Basic 
Authorities Act of 1956.

Sec. 362--Conforming amendment to the SEED Act

    Makes conforming amendment to the Support for East European 
Democracies Act of 1989.

Sec. 363--International Cultural and Trade Center Commission

    Makes conforming amendments to the Federal Triangle 
Development Act.

Sec. 364--Foreign Service Act of 1980

    Makes conforming amendments to the Foreign Service Act of 
1980.

Sec. 365--Au Pair Programs

    Makes conforming amendment to the Eisenhower Exchange 
Fellowship Act of 1990.

Sec. 366--Exchange program with countries in transition from 
        totalitarianism to democracy

    Makes conforming amendments to the National and Community 
Service Act of 1990.

Sec. 367--Edmund S. Muskie Fellowship Program

    Makes conforming amendments to the Foreign Relations 
Authorization Act, fiscal years 1992 and 1993.

Sec. 368--Implementation of Convention on Cultural Property

    Makes conforming amendment to the Convention on Cultural 
Property Implementation Act.

Sec. 369--Mike Mansfield Fellowships

    Makes conforming amendment to the Foreign Relations 
Authorization Act, fiscal years 1994 and 1995.

             TITLE IV--AGENCY FOR INTERNATIONAL DEVELOPMENT

                     CHAPTER 1--GENERAL PROVISIONS

Sec. 401--Effective Date

    Provides that the amendments made by this title (other than 
section 421) shall take effect on March 1, 1997, or on an 
earlier date announced by the President in the Federal 
Register, which date may be not earlier than 60 calendar days 
(excluding any days on which either House of Congress is not in 
session because of a sine die adjournment) after the President 
has submitted a reorganization plan to the appropriate 
committees of Congress pursuant to section 421. Section 421 
shall take effect on the date of enactment.

Sec. 402--References in title

    States that, except as otherwise provided, the references 
in this title to provisions of law shall be considered 
references to the Foreign Assistance Act of 1961.

 CHAPTER 2--ABOLITION OF THE AGENCY FOR INTERNATIONAL DEVELOPMENT AND 
   THE INTERNATIONAL DEVELOPMENT COOPERATION AGENCY AND TRANSFER OF 
                    FUNCTIONS TO SECRETARY OF STATE

Sec. 411--Abolition of Agency for International Development and 
        International Development Cooperation Agency

    Abolishes AID and the International Development Cooperation 
Agency.

Sec. 412--Transfer of functions to Secretary of State

    Transfers to the Secretary of State all functions of the 
Administrator of AID and of AID, and all functions of the 
Director of the International Development Cooperation Agency 
and of the International Development Cooperation Agency.

CHAPTER 3--REORGANIZATION OF DEPARTMENT OF STATE RELATING TO FUNCTIONS 
                      TRANSFERRED UNDER THIS TITLE

Sec. 421--Reorganization plan

     Provides that, not later than March 1, 1996, the 
President, in consultation with the Secretary of State and the 
Administrator of AID, shall submit a reorganization plan to the 
appropriate committees of Congress. The plan is to provide for 
the abolition of AID; the transfer of AID's functions and 
personnel to the Department of State; and the consolidation, 
reorganization, and streamlining of the Department of State 
upon the transfer in order to carry out the transferred 
functions.
     The plan is to identify the functions of AID that are to 
be transferred; the personnel and positions of AID and the 
Department that are to be transferred, separated, or 
eliminated; specify the consolidations and reorganizations 
within the Department that will be required; specify the funds 
available to AID that will be transferred; specify the proposed 
allocations within the Department of unexpended funds that are 
to be transferred from AID; and specify the proposed 
disposition of the property, facilities, contracts, records, 
and other assets and liabilities of AID.
     The plan is to provide for an appropriate number of 
Assistant Secretaries of State to carry out the functions 
transferred to the Department.
     The committee intends that AID be transferred en bloc into 
the Department of State, reporting to the Under Secretary for 
Development. The committee reviewed the option of dividing AID 
among the Department's regional bureaus and specifically 
rejected that option.

Sec. 422--Principal officers

     Amends the State Department Basic Authorities Act to 
establish the new position within the Department of State of 
Under Secretary for Development and Economic Affairs. A 
transition provision provides that the President is authorized 
to appoint to this position the Administrator of AID, or 
another official of AID or the Department of State confirmed by 
the Senate, to serve in an acting capacity until the President 
nominates and the Senate confirms a permanent appointee.
     The committee intends the Under Secretary for Development 
to be responsible for the administration of funds under the 
Sustainable Development, Development Fund for Africa, SEED, 
FREEDOM Support, ESF, Disaster, Housing Guarantee, Small and 
Micro-enterprise, Public Law-480 titles II & III, American 
Schools and Hospitals Abroad and International Fund for Ireland 
accounts. The committee intends this list of accounts to be the 
minimum number of accounts administered by the Under Secretary 
for Development. Should the administration wish, the committee 
would welcome the movement of other foreign assistance programs 
under the Under Secretary's administration.

                    CHAPTER 4--CONFORMING AMENDMENTS

Sec. 441--References

     Provides that any reference in any statute or other 
official document or proceeding to the Administrator of AID 
shall be deemed to refer to the Secretary of State, and any 
reference to AID shall be deemed to refer to the Department of 
State.

Sec. 442--Abolition of Office of Inspector General of the Agency for 
        International Development and transfer of functions to Office 
        of Inspector General of the Department of State

     Abolishes the Office of Inspector General of AID, and 
transfers the functions of that Office to the Office of 
Inspector General of the Department of State.

Sec. 443--Abolition of Chief Financial Officer of the Agency for 
        International Development and transfer of functions to Chief 
        Financial Officer Department of State

     Abolishes the Office of Chief Financial Officer of AID, 
and transfers the functions of that Office to the Office of 
Chief Financial Officer of the Department of State.

Sec. 444--Amendments to title 5, United States Code

     Makes conforming amendments to title 5 of the United 
States Code.

Sec. 445--Public Law 480 Program

     Makes conforming amendment to the Agricultural Trade 
Development and Assistance Act of 1954.

                          TITLE V--TRANSITION

Sec. 501--Reorganization authority

     Authorizes the Secretary of State to allocate or 
reallocate functions transferred to the Department among the 
officers of the Department, and to establish, consolidate, 
alter, or discontinue organizational entities within the 
Department as necessary to carry out any reorganization under 
this division. This authority does not extend to the abolition 
of organizational entities or offices established by law, or to 
the alteration of any delegation of functions required by law.
     A reorganization plan prepared pursuant to any title of 
this division may not have the effect of creating a new 
department or agency, continuing functions beyond the period 
authorized by law, authorizing the exercise of functions not 
otherwise authorized by law, or increasing the term of an 
office beyond that provided by law. Any such reorganization 
plan shall provide for a 20-percent reduction applicable to 
each of the first 2 fiscal years after implementation of such 
plan in the total level of expenditures for the functions 
transferred to the Department of State from the amounts 
appropriated for such transferred functions for fiscal year 
1995.

Sec. 502--Transfer and allocation of appropriations and personnel

     Provides that personnel, assets, liabilities, contracts, 
property, records, and unexpended appropriations balances of 
the abolished agencies shall be transferred to the Secretary of 
State. Unexpended and unobligated funds that are so transferred 
shall be used only for the purposes for which they were 
originally authorized and appropriated. When an agency is 
abolished, the limit on the number of members of the foreign 
service that may be employed by that agency shall be added to 
the limit for the Department of State.

Sec. 503--Incidental transfers

     The Director of the Office of Management and Budget, in 
consultation with the Secretary of State, is authorized to make 
such incidental dispositions of personnel, assets, liabilities, 
contracts, property, records, and unexpended balances of 
appropriations as may be necessary to carry out this division.

Sec. 504--Effect on personnel

     Personnel holding executive schedule positions who are 
transferred to the Department of State shall continue to be 
compensated at a rate not less than that of their previous 
position. Positions whose incumbents are appointed by the 
President and confirmed by the Senate, the functions of which 
are transferred, shall terminate upon the transfer.
     Employees in the career Senior Executive Service 
transferred pursuant to any title of this division shall be 
placed in a position at the Department of State comparable to 
the position previously held by the employee. Transferring 
employees shall be provided reasonable notice of new positions 
and assignments prior to their transfer pursuant to any title 
of this division. Foreign Service personnel transferred to the 
Department of State pursuant to any title of this division 
shall be eligible for any assignment open to Foreign Service 
personnel within the Department for which they are qualified.

Sec. 505--Savings provisions

     All orders, rules, regulations, agreements, contracts, and 
other administrative actions of the agencies abolished under 
this division shall remain in effect according to their terms. 
Pending proceedings shall not be affected by the transfer of 
functions of the abolished agencies to the Department of State.

Sec. 506--Property and facilities

     The Secretary of State shall review the property and 
facilities transferred to the Department to determine whether 
they are required by the Department.

Sec. 507--Authority of Secretary to facilitate transition

     The Secretary of State is authorized to utilize the 
services of employees and the funds of the agencies that are to 
be abolished pursuant to this division in order to facilitate 
the transfer of functions to the Department.

Sec. 508--Recommendations for additional conforming amendments

     The Congress urges the President to submit recommendations 
for additional technical and conforming amendments to reflect 
the changes made by this division.

Sec. 509--Final report

     Not later than October 1, 1998, the President, in 
consultation with the Secretary of the Treasury and the 
Director of the Office of Management and Budget, shall submit 
to the appropriate congressional committees a final accounting 
of the finances of the abolished agencies.

Sec. 510--Transfer of function

     Any determination as to whether a transfer of function 
carried out under this division constitutes a transfer of 
function for purposes of subchapter I of chapter 35 of title 5 
of the United States Code shall be made without regard to 
whether the function transferred is identical to functions 
already performed by the receiving agency.

Sec. 511--Severability

     If any provision of this division is held invalid, the 
remainder of the division shall not be affected.

 TITLE VI--REORGANIZATION OF UNITED STATES EXPORT PROMOTION AND TRADE 
                               ACTIVITIES

Sec. 601--Plan for reorganization of United States export promotion and 
        trade activities

     The Trade Policy Coordinating Committee shall submit a 
report to the Committee on International Relations of the House 
and the Committee on Foreign Relations of the Senate not later 
than March 1, 1996, detailing what steps are being taken and 
what steps should be taken to improve accessibility and 
coordination among the trade promotion agencies of the U.S. 
Government.
     The report shall identify such matters as the function and 
budget of all U.S. Government agencies with some responsibility 
for trade promotion, the amount of exports directly generated 
by each such agency, and areas where greater interoperability 
and efficiencies could be achieved. The report shall include a 
plan to reorganize the trade and export promotion agencies, 
with any necessary legislative changes, in order to more 
efficiently promote trade and reduce costs.

   Changes in Existing Law Made by Title VI of the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

             STATE DEPARTMENT BASIC AUTHORITIES ACT OF 1956

          * * * * * * *

                  TITLE I--BASIC AUTHORITIES GENERALLY

                organization of the department of state

  Section 1. (a)  * * *
  (b) Under Secretaries.--[There]
          (1) In general.--There shall be in the Department of 
        State not more than 5 Under Secretaries of State, who 
        shall be appointed by the President, by and with the 
        advice and consent of the Senate, and who shall be 
        compensated at the rate provided for at level III of 
        the Executive Schedule under section 5314 of title 5, 
        United States Code.
          (2) Under secretary for public diplomacy.--There 
        shall be in the Department of State an Under Secretary 
        for Public Diplomacy who shall have responsibility to 
        assist the Secretary and the Deputy Secretary in the 
        formation and implementation of United States public 
        diplomacy policies and activities, including 
        international educational and cultural exchange 
        programs, information, and international broadcasting.
          (3) Under secretary for development and economic 
        affairs.--There shall be in the Department of State an 
        Under Secretary for Development and Economic Affairs 
        who shall assist the Secretary and the Deputy Secretary 
        in the formation and implementation of United States 
        policies and activities concerning international 
        development and economic affairs.
  (c) Assistant Secretaries.--
          (1)  * * *
          * * * * * * *
          (3) Assistant secretary for academic programs and 
        cultural exchanges.--There shall be in the Department 
        of State an Assistant Secretary for Academic Programs 
        and Cultural Exchanges who shall report to the Under 
        Secretary for Public Diplomacy.
          (4) Assistant secretary for information, policy, and 
        programs.--There shall be in the Department of State an 
        Assistant Secretary for Information, Policy, and 
        Programs who shall report to the Under Secretary for 
        Public Diplomacy.
          * * * * * * *
  (e) Other Senior Officials.--In addition to officials of the 
Department of State who are otherwise authorized to be 
appointed by the President, by and with the advice and consent 
of the Senate, and to be compensated at level IV of the 
Executive Schedule of section 5315 of title 5, United States 
Code, four other such appointments are authorized.
          (5) Coordinator for arms control and disarmament.--
                  (A) There shall be within the office of the 
                Secretary of State a Coordinator for Arms 
                Control and Disarmament (hereafter in this 
                paragraph referred to as the ``Coordinator'' 
                who shall be appointed by the President, by and 
                with the advice and consent of the Senate. The 
                Coordinator shall report directly to the 
                Secretary of State.
                  (B)(i) The Coordinator shall perform such 
                duties and exercise such power as the Secretary 
                of State shall prescribe.
                  (ii) The Coordinator shall be responsible for 
                arms control and disarmament matters. The 
                Coordinator shall head the Bureau of Arms 
                Control and Disarmament.
                  (C) The Coordinator shall have the rank and 
                status of Ambassador-at-Large. The Coordinator 
                shall be compensated at the annual rate of 
                basic pay in effect for a position at level IV 
                of the Executive Schedule under section 5314 of 
                title 5, United States Code, or, if the 
                Coordinator is appointed from the Foreign 
                Service, the annual rate of pay which the 
                individual last received under the Foreign 
                Service Schedule, whichever is greater.
          * * * * * * *

                        administrative services

  Sec. 23. (a) Agreements.--Whenever the head of any Federal 
agency performing any foreign affairs functions [(including, 
but not limited to, the Department of State, the International 
Communication Agency, the Agency for International Development, 
and the Arms Control and Disarmament Agency)] determines that 
administrative services performed in common by the Department 
of State and one or more [other such agencies] other Federal 
agencies may be performed more advantageously and more 
economically on a consolidated basis, the Secretary of State 
and the heads of the other agencies concerned may, subject to 
the approval of the Director of the Office of Management and 
Budget, conclude an agreement which provides for the transfer 
to and consolidation within the Department or within one of the 
other agencies concerned of so much of the functions, 
personnel, property, records, and funds of the Department and 
of the other agencies concerned as may be necessary to enable 
the performance of those administrative services on a 
consolidated basis for the benefit of all agencies concerned. 
Agreements for consolidation of administrative services under 
this section shall provide for reimbursement or advances of 
funds from the agency receiving the service to the agency 
performing the service in amounts which will approximate the 
expense of providing administrative services for the serviced 
agency.
          * * * * * * *
  Sec. 26. (a)  * * *
  [(b) The authority available to the Secretary of State under 
this section shall be available to the Director of the United 
States Information Agency, the chairman of the Board for 
International Broadcasting, and the Director of the United 
States International Development Cooperation Agency with 
respect to their respective agencies.]
          * * * * * * *
  Sec. 32. The Secretary of State may pay, without regard to 
section 5702 of title 5, United States Code, subsistence 
expenses of (1) special agents of the Department of State who 
are on authorized protective missions, and (2) members of the 
Foreign Service and employees of the Department who are 
required to spend extraordinary amounts of time in travel 
status. [The authorities available to the Secretary of State 
under this section with respect to the Department of State 
shall be available to the Director of the United States 
Information Agency and the Director of the United States 
International Development Cooperation Agency with respect to 
their respective agencies, except that the authority of clause 
(2) shall be available with respect to those agencies only in 
the case of members of the Foreign Service and employees of the 
agency who are performing security-related functions abroad.]
          * * * * * * *
                              ----------                              


            SECTION 101 OF THE NATIONAL SECURITY ACT OF 1947

                       national security council

  Sec. 101. (a)  * * *
          * * * * * * *
  (i) The Coordinator for Arms Control and Disarmament may, in 
the role of advisor to the National Security Council on arms 
control and disarmament matters, and subject to the direction 
of the President, attend and participate in meetings of the 
National Security Council.
                              ----------                              


                    ARMS CONTROL AND DISARMAMENT ACT

   AN ACT To establish a United States Arms Control and Disarmament 
                                Agency.

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

             TITLE I--SHORT TITLE, PURPOSE, AND DEFINITIONS

                              short title

  Section 1. This Act may be cited as the ``Arms Control and 
Disarmament Act''.

                                [purpose

  [Sec. 2. An ultimate goal of the United States is a world 
which is free from the scourge of war and the dangers and 
burdens of armaments; in which the use of force has been 
subordinated to the rule of law; and in which international 
adjustments to a changing world are achieved peacefully. It is 
the purpose of this Act to provide impetus toward this goal by 
creating a new agency of peace to deal with the problem of 
reduction and control of armaments looking toward ultimate 
world disarmament.
  [Arms control, nonproliferation, and disarmament policy, 
being an important aspect of foreign policy, must be consistent 
with national security policy as a whole. The formulation and 
implementation of United States arms control, nonproliferation, 
and disarmament policy in a manner which will promote the 
national security can best be insured by a central organization 
charged by statute with primary responsibility for this field. 
This organization must have such a position within the 
Government that it can provide the President, the Secretary of 
State, other officials of the executive branch, and the 
Congress with recommendations concerning United States arms 
control, nonproliferation, and disarmament policy, and can 
assess the effect of these recommendations upon our foreign 
policies, our national security policies, and our economy.
  [This organization must have the capacity to provide the 
essential scientific, economic, political, military, 
psychological, and technological information upon which 
realistic arms control, nonproliferation, and disarmament 
policy must be based. It shall have the authority, under the 
direction of the President and the Secretary of State, to carry 
out the following primary functions:
          [(1) The preparation for and management of United 
        States participation in international negotiations and 
        implementation fora in the arms control and disarmament 
        field.
          [(2) When directed by the President, the preparation 
        for, and management of, United States participation in 
        international negotiations and implementation fora in 
        the nonproliferation field.
          [(3) The conduct, support, and coordination of 
        research for arms control, nonproliferation, and 
        disarmament policy formulation.
          [(4) The preparation for, operation of, or, as 
        appropriate, direction of, United States participation 
        in such control systems as may become part of United 
        States arms control, nonproliferation, and disarmament 
        activities.
          [(5) The dissemination and coordination of public 
        information concerning arms control, nonproliferation, 
        and disarmament.]

                              definitions

  Sec. 3. As used in this Act--
          (a) The terms ``arms control'' and ``disarmament'' 
        mean the identification, verification, inspection, 
        limitation, control, reduction, or elimination, of 
        armed forces and armaments of all kinds under 
        international agreement including the necessary steps 
        taken under such an agreement to establish an effective 
        system of international control, or to create and 
        strengthen international organizations for the 
        maintenance of peace.
          (b) The term ``Government agency'' means any 
        executive department, commission, agency, independent 
        establishment, corporation wholly or partly owned by 
        the United States which is an instrumentality of the 
        United States, or any board, bureau, division, service, 
        office, officer, authority, administration, or other 
        establishment in the executive branch of Government.
          [(c) The term ``Agency'' means the United States Arms 
        Control and Disarmament Agency.]
          (c) The term ``Department'' means the Department of 
        State.
          (d) The term ``Secretary'' means the Secretary of 
        State.

                         TITLE II--ORGANIZATION

           [united states arms control and disarmament agency

  [Sec. 21. There is hereby established an agency to be known 
as the ``United States Arms Control and Disarmament Agency''.]

                               [director

  [Sec. 22. (a) Appointment.--The Agency shall be headed by a 
Director appointed by the President, by and with the advice and 
consent of the Senate. No person serving on active duty as a 
commissioned officer of the Armed Forces of the United States 
may be appointed Director.
  [(b) Duties.--(1) The Director shall serve as the principal 
adviser to the Secretary of State, the National Security 
Council, and the President and other executive branch 
Government officials on matters relating to arms control, 
nonproliferation, and disarmament. In carrying out his duties 
under this Act, the Director, under the direction of the 
President and the Secretary of State, shall have primary 
responsibility within the Government for matters relating to 
arms control and disarmament, and, whenever directed by the 
President, primary responsibility within the Government for 
matters relating to nonproliferation.
  [(2) The Director shall attend all meetings of the National 
Security Council involving weapons procurement, arms sales, 
consideration of the defense budget, and all arms control, 
nonproliferation, and disarmament matters.

                            [deputy director

  [Sec. 23. A Deputy Director of the Agency shall be appointed 
by the President, by and with the advice and consent of the 
Senate. The Deputy Director shall have direct responsibility, 
under the supervision of the Director, for the administrative 
management of the Agency, intelligence-related activities, 
security, and the Special Compartmental Intelligence Facility, 
and shall perform such other duties and exercise such other 
powers as the Director may prescribe. He shall act for, and 
exercise the powers of, the Director during his absence or 
disability or during a vacancy in said office. No person 
serving on active duty as a commissioned officer of the Armed 
Forces of the United States may be appointed Deputy Director.

                          [assistant directors

  [Sec. 24. Not to exceed four Assistant Directors may be 
appointed by the President, by and with the advice and consent 
of the Senate. They shall perform such duties and exercise such 
powers as the Director may prescribe.

                    [bureaus, offices, and divisions

  [Sec. 25. The Director may establish within the Agency such 
bureaus, offices, and divisions as he may determine to be 
necessary to discharge his responsibilities pursuant to this 
Act, including a bureau of intelligence and information support 
and an office to perform legal services for the Agency.]

                scientific and policy advisory committee

  Sec. 26. (a) Establishment.--(1) The President may appoint a 
Scientific and Policy Advisory Committee (in this section 
referred to as the ``Committee'') of not to exceed 15 members, 
not less than eight of whom shall be scientists.
  (2) The members of the Committee shall be appointed as 
follows:
          (A) One member, who shall be a person of renown and 
        distinction, shall be appointed by the President, by 
        and with the advice and consent of the Senate, as 
        Chairman of the Committee.
          (B) Fourteen other members shall be appointed by the 
        President.
  (3) The Committee shall meet at least twice each year.
  (b) Function.--It shall be the responsibility of the 
Committee to advise the President[, the Secretary of State, and 
the Director] and the Secretary of State respecting scientific, 
technical, and policy matters affecting arms control, 
nonproliferation, and disarmament.
  (c) Reimbursement of Expenses.--The members of the Committee 
may receive reimbursement of expenses only in accordance with 
the provisions applicable to the reimbursement of experts and 
consultants under section 41(d) of this Act.
  (d) Termination.--The Committee shall terminate two years 
after the date of enactment of the Arms Control and 
Nonproliferation Act of 1994.
  (e) Definition.--As used in this section, the term 
``scientist'' means an individual who has a demonstrated 
knowledge and technical expertise with respect to arms control, 
nonproliferation, and disarmament matters and who has 
distinguished himself or herself in any of the fields of 
physics, chemistry, mathematics, biology, or engineering, 
including weapons engineering.

                  presidential special representatives

  Sec. 27. The President may appoint, by and with the advice 
and consent of the Senate, Special Representatives of the 
President for arms control, nonproliferation, and disarmament 
matters. Each Presidential Special Representative shall hold 
the rank of ambassador. One such Representative may serve in 
the [Agency] Department as Chief Science Advisor. Presidential 
Special Representatives appointed under this section shall 
perform their duties and exercise their powers under the 
direction of the President and the Secretary of State[, acting 
through the Director]. The [Agency] Department shall be the 
Government agency responsible for providing administrative 
support, including funding, staff, and office space, to all 
Presidential Special Representatives.

                     program for visiting scholars

  Sec. 28. A program for visiting scholars in the fields of 
arms control, nonproliferation, and disarmament shall be 
established by the [Director] Secretary in order to obtain the 
services of scholars from the faculties of recognized 
institutes of higher learning. The purpose of the program will 
be to give specialists in the physical sciences and other 
disciplines relevant to the [Agency's activities] Department's 
arms control, nonproliferation, and disarmament activities an 
opportunity for active participation in the arms control, 
nonproliferation, and disarmament activities of the [Agency] 
Department and to gain for the [Agency] Department the 
perspective and expertise such persons can offer. Each fellow 
in the program shall be appointed for a term of one year, 
except that such term may be extended for a 1-year period. 
Fellows shall be chosen by a board consisting of the [Director] 
Secretary, who shall be the chairperson[, and all former 
Directors of the Agency].

                          TITLE III--FUNCTIONS

                                research

  Sec. 31. The [Director] Secretary is authorized and directed 
to exercise his powers in such manner as to insure the 
acquisition of a fund of theoretical and practical knowledge 
concerning disarmament and nonproliferation. To this end, the 
[Director] Secretary is authorized and directed, under the 
direction of the President, (1) to insure the conduct of 
research, development, and other studies in the fields of arms 
control, nonproliferation, and disarmament; (2) to make 
arrangements (including contracts, agreements, and grants) for 
the conduct of research, development, and other studies in the 
fields of arms control, nonproliferation, and disarmament by 
private or public institutions or persons; and (3) to 
coordinate the research, development, and other studies 
conducted in the fields of arms control, nonproliferation, and 
disarmament by or for other Government agencies in accordance 
with procedures established under section 35 of this Act. In 
carrying out his responsibilities under this Act, the 
[Director] Secretary shall, to the maximum extent feasible, 
make full use of available facilities, Government and private. 
The authority of the [Director] Secretary with respect to 
research, development, and other studies shall be limited to 
participation in the following insofar as they relate to arms 
control, nonproliferation, and disarmament:
          (a) the detection, identification, inspection, 
        monitoring, limitation, reduction, control, and 
        elimination of armed forces and armaments, including 
        thermonuclear, nuclear, missile, conventional, 
        bacteriological, chemical, and radiological weapons;
          (b) the techniques and systems of detecting, 
        identifying, inspecting, and monitoring of tests of 
        nuclear, thermonuclear, and other weapons;
          (c) the analysis of national budgets, levels of 
        industrial production, and economic indicators to 
        determine the amounts spent by various countries for 
        armaments and of all aspects of antisatellite 
        activities;
          (d) the control, reduction, and elimination of armed 
        forces and armaments in space, in areas on and beneath 
        the earth's surface, and in underwater regions;
          (e) the structure and operation of international 
        control and other organizations useful for arms 
        control, nonproliferation, and disarmament;
          (f) the training of scientists, technicians, and 
        other personnel for manning the control systems which 
        may be created by international arms control, 
        nonproliferation, and disarmament agreements;
          (g) the reduction and elimination of the danger of 
        war resulting from accident, miscalculation, or 
        possible surprise attack, including (but not limited 
        to) improvements in the methods of communications 
        between nations;
          (h) the economic and political consequences of arms 
        control, nonproliferation, and disarmament, including 
        the problems of readjustment arising in industry and 
        the reallocation of national resources;
          (i) the arms control, nonproliferation, and 
        disarmament implications of foreign and national 
        security policies of the United States with a view to a 
        better understanding of the significance of such 
        policies for the achievement of arms control, 
        nonproliferation, and disarmament;
          (j) the national security and foreign policy 
        implications of arms control, nonproliferation, and 
        disarmament proposals with a view to a better 
        understanding of the effect of such proposals upon 
        national security and foreign policy;
          (k) methods for the maintenance of peace and security 
        during different stages of arms control, 
        nonproliferation, and disarmament;
          (l) the scientific, economic, political, legal, 
        social, psychological, military, and technological 
        factors related to the prevention of war with a view to 
        a better understanding of how the basic structure of a 
        lasting peace may be established;
          (m) such related problems as the [Director] Secretary 
        may determine to be in need of research, development, 
        or study in order to carry out the provisions of this 
        Act.

                                patents

  Sec. 32. All research within the United States contracted 
for, sponsored, cosponsored, or authorized under authority of 
this Act, shall be provided for in such manner that all 
information as to uses, products, processes, patents, and other 
developments resulting from such research developed by 
Government expenditure will (with such exceptions and 
limitations, if any, as the [Director] Secretary may find to be 
necessary in the public interest) be available to the general 
public. This subsection shall not be so construed as to deprive 
the owner of any background patent relating thereto of such 
rights as he may have thereunder.

                           policy formulation

  Sec. 33. (a) Formulation.--The [Director] Secretary [shall 
prepare for the President, the Secretary of State,] shall 
prepare for the President and the heads of such other 
Government agencies as the President may determine, 
recommendations and advice concerning United States arms 
control, nonproliferation, and disarmament policy.
  (b) Prohibition.--No action shall be taken pursuant to this 
or any other Act that would obligate the United States to 
reduce or limit the Armed Forces or armaments of the United 
States in a militarily significant manner, except pursuant to 
the treaty-making power of the President set forth in Article 
II, Section 2, Clause 2 of the Constitution or unless 
authorized by the enactment of further affirmative legislation 
by the Congress of the United States.

                         negotiation management

  Sec. 34. (a) Responsibilities.--The [Director] Secretary, 
under the direction of the President [and the Secretary of 
State], shall have primary responsibility for the preparation, 
conduct, and management of United States participation in all 
international negotiations and implementation fora in the field 
of arms control and disarmament and shall have primary 
responsibility, whenever directed by the President, for the 
preparation, conduct, and management of United States 
participation in international negotiations and implementation 
fora in the field of nonproliferation. In furtherance of these 
responsibilities, Special Representatives of the President 
appointed pursuant to section 27, shall, as directed by the 
President, serve as the United States Government 
representatives to international organizations, conferences, 
and activities relating to the field of nonproliferation, such 
as the preparations for and conduct of the review relating to 
the Treaty on the Non-Proliferation of Nuclear Weapons.
  [(b) Functions With Respect to the United States Information 
Agency.--The Director shall perform functions pursuant to 
section 2(c) of the Reorganization Plan 8 of 1953 with respect 
to providing to the United States Information Agency official 
United States positions and policy on arms control, 
nonproliferation, and disarmament matters for dissemination 
abroad.]
  (c) Authority.--The [Director] Secretary is authorized--
          (1) for the purpose of conducting negotiations 
        concerning arms control, nonproliferation, or 
        disarmament or for the purpose of exercising any other 
        authority given him by this Act--
                  (A) to consult and communicate with, or to 
                direct the consultation and communication with, 
                representatives of other nations or of 
                international organizations, and
                  (B) to communicate in the name of the 
                Secretary of State with diplomatic 
                representatives of the United States in the 
                United States or abroad;
          (2) to formulate plans and make preparations for the 
        establishment, operation, and funding of inspections 
        and control systems which may become part of the United 
        States arms control, nonproliferation, and disarmament 
        activities; and
          (3) as authorized by law, to put into effect, direct, 
        or otherwise assume United States responsibility for 
        such systems.

                              coordination

  Sec. 35. The President is authorized to establish procedures 
to (1) assure cooperation, consultation, and a continuing 
exchange of information between the [Agency] Department and the 
Department of Defense, the Atomic Energy Commission, the 
National Aeronautics and Space Administration, and other 
affected Government agencies, in all significant aspects of 
United States arms control, nonproliferation, and disarmament 
policy and related matters, including current and prospective 
policies, plans, and programs, (2) resolve differences of 
opinion between the [Director] Secretary and such other 
agencies which cannot be resolved through consultation, and (3) 
provide for presentation to the President of recommendations of 
the [Director] Secretary with respect to such differences, when 
such differences involve major matters of policy and cannot be 
resolved through consultation.

                        arms control information

  Sec. 36. In order to assist the [Director] Secretary in the 
performance of his duties with respect to arms control, 
nonproliferation, and disarmament policy and negotiations, any 
Government agency preparing any legislative or budgetary 
proposal for--
          (1) any program of research, development, testing, 
        engineering, construction, deployment, or modernization 
        with respect to nuclear armaments, nuclear implements 
        of war, military facilities or military vehicles 
        designed or intended primarily for the delivery of 
        nuclear weapons,
          (2) any program of research, development, testing, 
        engineering, construction, deployment, or modernization 
        with respect to armaments, ammunition, implements of 
        war, or military facilities, having--
                  (A) an estimated total program cost in excess 
                of $250,000,000, or
                  (B) an estimated annual program cost in 
                excess of $50,000,000, or
          (3) any other program involving technology with 
        potential military application or weapons systems which 
        such Government agency or the [Director] Secretary 
        believes may have a significant impact on arms control, 
        nonproliferation, and disarmament policy or 
        negotiations,
shall, on a continuing basis, provide the [Director] Secretary 
with full and timely access to detailed information, in 
accordance with the procedures established pursuant to section 
35 of this Act, with respect to the nature, scope, and purpose 
of such proposal.

                       verification of compliance

  Sec. 37. (a) In General.--In order to ensure that arms 
control, nonproliferation, and disarmament agreements can be 
adequately verified, the [Director] Secretary shall report to 
Congress, on a timely basis, or upon request by an appropriate 
committee of the Congress--
          (1) in the case of any arms control, 
        nonproliferation, or disarmament agreement that has 
        been concluded by the United States, the determination 
        of the [Director] Secretary as to the degree to which 
        the components of such agreement can be verified;
          (2) in the case of any arms control, 
        nonproliferation, or disarmament agreement that has 
        entered into force, any significant degradation or 
        alteration in the capacity of the United States to 
        verify compliance of the components of such agreement;
          (3) the amount and percentage of research funds 
        expended by the [Agency] Department for the purpose of 
        analyzing issues relating to arms control, 
        nonproliferation, and disarmament verification; and
          (4) the number of professional personnel assigned to 
        arms control verification on a full-time basis by each 
        Government agency.
  (b) Standard for Verification of Compliance.--In making 
determinations under paragraphs (1) and (2) of subsection (a), 
the [Director] Secretary shall assume that all measures of 
concealment not expressly prohibited could be employed and that 
standard practices could be altered so as to impede 
verification.
  (c) Rule of Construction.--Except as otherwise provided for 
by law, nothing in this section may be construed as requiring 
the disclosure of sensitive information relating to 
intelligence sources or methods or persons employed in the 
verification of compliance with arms control, nonproliferation, 
and disarmament agreements.
  (d) Participation of the [Agency] Department.--In order to 
ensure adherence of the United States to obligations or 
commitments undertaken in arms control, nonproliferation, and 
disarmament agreements, and in order for the [Director] 
Secretary to make the assessment required by section 51(a)(5), 
the [Director] Secretary, or the [Director's] Secretary's 
designee, shall participate in all interagency groups or 
organizations within the executive branch of Government that 
assess, analyze, or review United States planned or ongoing 
policies, programs, or actions that have a direct bearing on 
United States adherence to obligations undertaken in arms 
control, nonproliferation, or disarmament agreements.

                          negotiating records

  Sec. 38. (a) Preparation of Records.--The [Director] 
Secretary shall establish and maintain records for each arms 
control, nonproliferation, and disarmament agreement to which 
the United States is a party and which was under negotiation or 
in force on or after January 1, 1990, which shall include 
classified and unclassified materials such as instructions and 
guidance, position papers, reporting cables and memoranda of 
conversation, working papers, draft texts of the agreement, 
diplomatic notes, notes verbal, and other internal and external 
correspondence.
  (b) Negotiating and Implementation Records.--In particular, 
the [Director] Secretary shall establish and maintain a 
negotiating and implementation record for each such agreement, 
which shall be comprehensive and detailed, and shall document 
all communications between the parties with respect to such 
agreement. Such records shall be maintained both in hard copy 
and magnetic media.
  (c) Participation of [Agency] Department Personnel.--In order 
to implement effectively this section, the [Director] Secretary 
shall ensure that [Agency] Department personnel participate 
throughout the negotiation and implementation phases of all 
arms control, nonproliferation, and disarmament agreements.

   comprehensive compilation of arms control and disarmament studies

  Sec. 39. Pursuant to his responsibilities under section 31 of 
this Act, and in order to enhance Congressional and public 
understanding of arms control, nonproliferation, and 
disarmament issues, the [Director] Secretary shall provide to 
the Congress not later than June 30 of each year a report 
setting forth--
          (1) a comprehensive list of studies relating to arms 
        control, nonproliferation, and disarmament issues 
        concluded during the previous calendar year by 
        government agencies or for government agencies by 
        private or public institutions or persons; and
          (2) a brief description of each such study.
This report shall be unclassified, with a classified addendum 
if necessary.

                      TITLE IV--GENERAL PROVISIONS

                           [general authority

  [Sec. 41. In the performance of his functions, the Director 
is authorized to--
  [(a) utilize or employ the services, personnel, equipment, or 
facilities of any other Government agency, with the consent of 
the agency concerned, to perform such functions on behalf of 
the Agency as may appear desirable. It is the intent of this 
section that the Director rely upon the Department of State for 
general administrative services in the United States and abroad 
to the extent agreed upon between the Secretary of State and 
the Director. Any Government agency is authorized, 
notwithstanding any other provision of law, to transfer to or 
to receive from the Director, without reimbursement, supplies 
and equipment other than administrative supplies or equipment. 
Transfer or receipt of excess property shall be in accordance 
with the provisions of the Federal Property and Administrative 
Services Act of 1949, as amended;
  [(b) appoint officers and employees, including attorneys, for 
the Agency in accordance with the provisions of title 5, United 
States Code, governing appointment in the competitive service, 
and fix their compensation in accordance with chapter 51 and 
with subchapter III of chapter 53 of such title, relating to 
classification and General Schedule pay rates, except that the 
Director may, to the extent the Director determines necessary 
to the discharge of his responsibilities, appoint and fix the 
compensation of employees possessing specialized technical 
expertise without regard to the provisions of title 5, United 
States Code, governing appointments in the competitive service 
and the provisions of chapter 51 and subchapter III of chapter 
53 of such title relating to classification and General 
Schedule pay rates, if the Director ensures that--
          [(1) any employee who is appointed under this 
        exception is not paid at a rate--
                  [(A) in excess of the rate payable for 
                positions of equivalent difficulty or 
                responsibility, or
                  [(B) exceeding the maximum rate payable for 
                grade 15 of the General Schedule; and
          [(2) the number of employees appointed under this 
        exception shall not exceed 10 percent of the Agency's 
        full-time-equivalent ceiling.
  [(c) enter into agreements with other Government agencies, 
including the military departments through the Secretary of 
Defense, under which officers or employees of such agencies may 
be detailed to the Agency for the performance of service 
pursuant to this Act without prejudice to the status or 
advancement of such officers or employees within their own 
agencies;
  [(d) procure services of experts and consultants or 
organizations thereof, including stenographic reporting 
services, as authorized by section 3109 of title 5 of the 
United States Code, and to pay in connection therewith travel 
expenses of individuals, including transportation and per diem 
in lieu of subsistence while away from their homes or regular 
places of business, as authorized by section 5703 of such 
title: Provided, That no such individual shall be employed for 
more than 130 days in any fiscal year unless the President 
certifies that employment of such individual in excess of such 
number of days is necessary in the national interest: And 
provided further, That such contracts may be renewed annually;
  [(e) employ individuals of outstanding ability without 
compensation in accordance with the provisions of section 
710(b) of the Defense Production Act of 1950, as amended (50 
U.S.C. App. 2160), and regulations issued thereunder;
  [(f) establish advisory boards to advise with and make 
recommendations to the Director on United States arms control 
and disarmament policy and activities. The members of such 
boards may receive the compensation and reimbursement for 
expenses specified for consultants by section 41(d) of this 
Act;
  [(g) permit, under such terms and conditions as he may 
prescribe, any officer or employee of the Agency, in connection 
with the attendance by such officer or employee at meetings or 
in performing advisory services concerned with the functions or 
activities of the Agency, to accept payment, in cash or in 
kind, from any private agency or organization, or from any 
individual affiliated with such agency or organization, for 
travel and subsistence expenses, such payment to be retained by 
such officer or employee to cover the cost thereof or to be 
deposited to the credit of the appropriation from which the 
cost thereof is paid;
  [(i) delegate, as appropriate, to the Deputy Director or 
other officers of the Agency, any authority conferred upon the 
Director by the provisions of this Act; and
  [(j) make, promulgate, issue, rescind, and amend such rules 
and regulations as may be necessary or desirable to the 
exercise of any authority conferred upon the Director by the 
provisions of this Act.]

                       foreign service personnel

  Sec. 42. (a) The Secretary of State may authorize the 
[Director] Secretary to exercise, with respect to members of 
the Foreign Service appointed or employed for the [Agency] 
Department--
          (1) the authority available to the Secretary under 
        the Foreign Service Act of 1980, and
          (2) the authority available to the Secretary under 
        any other provisions of law pertaining specifically or 
        applicable generally to members of the Foreign Service.
  (b) Limited appointments of members of the Foreign Service 
for the [Agency] Department may be extended or renewed, 
notwithstanding section 309 of the Foreign Service Act of 1980, 
so long as the service of the individual under such appointment 
does not exceed ten consecutive years without a break in 
service of at least one year.

                       contracts or expenditures

  Sec. 43. The President may, in advance, exempt actions of the 
[Director] Secretary from the provisions of law relating to 
contracts or expenditures of Government funds whenever he 
determines that such action is essential in the interest of 
United States arms control and disarmament and security policy.

            conflict-of-interest and dual compensation laws

  Sec. 44. The members of the General Advisory Committee 
created by section 26 of this Act, and the members of the 
advisory boards, the consultants, and the individuals of 
outstanding ability employed without compensation, all of which 
are provided in section 41 of this Act, may serve as such 
without regard to the provisions of section 281, 283, 284, or 
1914 of title 18 of the United States Code, or of section 190 
of the Revised Statutes (5 U.S.C. 99), or of any other Federal 
law imposing restrictions, requirements, or penalties in 
relation to the employment of individuals, the performance of 
services, or the payment or receipt of compensation in 
connection with any claim, proceeding, or matter involving the 
United States Government, except insofar as such provisions of 
law may prohibit any such individual from receiving 
compensation from a source other than a nonprofit educational 
institution in respect of any particular matter in which the 
[Agency] Department is directly interested. Nor shall such 
service be considered as employment or holding of office or 
position bringing such individual within the provisions of 
section 13 of the Civil Service Retirement Act (5 U.S.C. 2263), 
or any other Federal law limiting the reemployment of retired 
officers or employees or governing the simultaneous receipt of 
compensation and retired pay or annuities, subject to section 
201 of the Dual Compensation Act.

                         security requirements

  Sec. 45. [(a) The Director shall establish such security and 
loyalty requirements, restrictions, and safeguards as he deems 
necessary in the interest of the national security and to carry 
out the provisions of this Act. Except as provided in 
subsection (d), the Director shall arrange with the Civil 
Service Commission for the conduct of full-field background 
security and loyalty investigations of all the Agency's 
officers, employees, consultants, persons detailed from other 
Government agencies, members of its General Advisory Committee, 
advisory boards, contractors and subcontractors, and their 
officers and employees, actual or prospective. In the case of 
persons detailed from other Government agencies or employed 
directly from other Government agencies, the Director may 
accept the results of full-field background security and 
loyalty investigations conducted by such agencies as the basis 
for the determination required by this subsection that the 
person is not a security risk or of doubtful loyalty. In the 
event the investigation discloses information indicating that 
the person investigated may be or may become a security risk, 
or may be of doubtful loyalty, the report of the investigation 
shall be turned over to the Federal Bureau of Investigation for 
a full-field investigation. The final results of all such 
investigations shall be turned over to the Director for final 
determination. Except as provided in subsection (d), no person 
shall be permitted to enter on duty as such an officer, 
employee, consultant, or member of advisory committee or board, 
or pursuant to any such detail, and no contractor or 
subcontractor, or officer or employee thereof shall be 
permitted to have access to any classified information, until 
he shall have been investigated in accordance with this 
subsection and the report of such investigations made to the 
Director, and the Director shall have determined that such 
person is not a security risk or of doubtful loyalty. Standards 
applicable with respect to the security clearance of persons 
within any category referred to in this subsection shall not be 
less stringent, and the investigation of such persons for such 
purposes shall not be less intensive or complete, than in the 
case of such clearance of persons in a corresponding category 
under the security procedures of the Government agency or 
agencies having the highest security restrictions with respect 
to persons in such category.
  [(b) In the case of contractors or subcontractors and their 
officers or employees, actual or prospective, the Director may 
accept, in lieu of the investigation prescribed in subsection 
(a) hereof, a report of investigation conducted by a Government 
agency, other than the Civil Service Commission or the Federal 
Bureau of Investigation, when it is determined by the Director 
that the completed investigation meets the standards 
established in subsection (a) hereof: Provided, That security 
clearance had been granted to the individual concerned by 
another Government agency based upon such investigation and 
report. The Director may also grant access for information 
classified no higher than ``confidential'' to contractors or 
subcontractors and their officers and employees, actual or 
prospective, on the basis of reports on less than full-field 
investigations: Provided, That such investigations shall each 
include a current national agency check. Notwithstanding the 
foregoing and the provisions of subsection (a), the Director 
may also grant access to classified information to contractors 
or subcontractors and their officers and employees, actual or 
prospective, on the basis of a security clearance granted by 
the Department of Defense, or any agency thereof, to the 
individual concerned; except that any access to Restricted Data 
shall be subject to the provisions of subsection (c).]
  (c) The Atomic Energy Commission may authorize any of its 
employees, or employees of any contractor, prospective 
contractor, licensee, or prospective licensee of the Atomic 
Energy Commission, or any other person authorized to have 
access to Restricted Data by the Atomic Energy Commission under 
section 2165 of title 42, to permit the [Director] Secretary or 
any officer, employee, consultant, person detailed from other 
Government agencies, member of the General Advisory Committee 
or of an advisory board established pursuant to section 41(f), 
contractor, subcontractor, prospective contractor, or 
prospective subcontractor, or officer or employee of such 
contractor, subcontractor, prospective contractor, or 
prospective subcontractor, to have access to Restricted Data 
which is required in the performance of his duties and so 
certified by the [Director] Secretary, but only if (1) the 
Atomic Energy Commission has determined, in accordance with the 
established personnel security procedures and standards of the 
Commission, that permitting such individual to have access to 
such Restricted Data will not endanger the common defense and 
security, and (2) the Atomic Energy Commission finds that the 
established personnel and other security procedures and 
standards of the [Agency] Department are adequate and in 
reasonable conformity to the standards established by the 
Atomic Energy Commission under section 2165 of title 42, 
including those for interim clearance in subsection (b) 
thereof. Any individual granted access to such Restricted Data 
pursuant to this subsection may exchange such data with any 
individual who (A) is an officer or employee of the Department 
of Defense, or any department or agency thereof, or a member of 
the Armed Forces, or an officer or employee of the National 
Aeronautics and Space Administration, or a contractor or 
subcontractor of any such department, agency, or armed force, 
or an officer or employee of any such contractor or 
subcontractor, and (B) has been authorized to have access to 
Restricted Data under the provisions of sections 2163 or 2455 
of title 42.
  [(d) The investigations and determination required under 
subsection (a) may be waived by the Director in the case of any 
consultant who will not be permitted to have access to 
classified information if the Director determines and certifies 
in writing that such waiver is in the best interests of the 
United States.]

                       comptroller general audit

  Sec. 46. No moneys appropriated for the purposes of this Act 
shall be available for payment under any contract with the 
[Director] Secretary, negotiated without advertising, except 
contracts with any foreign government, international 
organization or any agency thereof, unless such contract 
includes a clause to the effect that the Comptroller General of 
the United States or any of his duly authorized representatives 
shall, until the expiration of three years after final payment, 
have access to and the right to examine any directly pertinent 
books, documents, papers, and records of the contractor or any 
of his subcontractors engaged in the performance of, and 
involving transactions related to such contracts or 
subcontracts: Provided, however, That no moneys so appropriated 
shall be available for payment under such contract which 
includes any provisions precluding an audit by the General 
Accounting Office of any transactions under such contract: And 
provided further, That nothing in this section shall preclude 
the earlier disposal of contractor and subcontractor records in 
accordance with records disposal schedules agreed upon between 
the [Director] Secretary and the General Accounting Office.

      transfer of activities and facilities to [agency] department

  Sec. 47. (a) The United States Disarmament Administration, 
together with its records, property, personnel, and funds, is 
hereby transferred to the [Agency] Department. The 
appropriations and unexpended balances of appropriations 
transferred pursuant to this subsection shall be available for 
expenditure for any and all objects of expenditure authorized 
by this Act, without regard to the requirements of 
apportionment under section 665 of title 31.
  (b) The President, by Executive order, may transfer to the 
[Director] Secretary any activities or facilities of any 
Government agency which relate primarily to arms control and 
disarmament. In connection with any such transfer, the 
President may under this section or other applicable authority, 
provide for appropriate transfers of records, property, 
civilian personnel, and funds. No transfer shall be made under 
this subsection until (1) a full and complete report concerning 
the nature and effect of such proposed transfer has been 
transmitted by the President to the Congress, and (2) the first 
period of sixty calendar days of regular session of the 
Congress following the date of receipt of such report by the 
Congress has expired without adoption by either House of the 
Congress of a resolution stating that such House does not favor 
such transfer. The procedures prescribed in title II of the 
Reorganization Act of 1949 shall apply to any such resolution.

                             [use of funds

  [Sec. 48. Appropriations made to the Director for the 
purposes of this Act, and transfers of funds to him by other 
Government agencies for such purposes, shall be available to 
him to exercise any authority granted him by this Act, 
including, without limitation, expenses of printing and binding 
without regard to the provisions of section 11 of the Act of 
March 1, 1919 (44 U.S.C. 111); purchase or hire of one 
passenger motor vehicle for the official use of the Director; 
entertainment and official courtesies to the extent authorized 
by appropriation; expenditures for training and study; 
expenditures in connection with participation in international 
conferences for the purposes of this Act; and expenses in 
connection with travel of personnel outside the United States, 
including transportation expenses of dependents, household 
goods, and personal effects (including any such travel or 
transportation any part of which begins in one fiscal year 
pursuant to travel orders issued in that fiscal year, but which 
is completed after the end of that fiscal year), and expenses 
authorized by the Foreign Service Act of 1980, not otherwise 
provided for.]

  specialists fluent in russian or other languages of the independent 
                   states of the former soviet union

  Sec. 49. The [Director] Secretary is authorized to create up 
to eight additional permanent personnel positions at both 
junior and more senior levels for specialists in the foreign 
and military policies of the independent states of the former 
Union, arms control, or strategic affairs of the former Soviet 
Union, who also demonstrate fluency in the Russian language or 
another language of the independent states of the former Soviet 
Union.

                        [acda inspector general

  [Sec. 50. (a) Establishment and Duties.--There shall be an 
Office of the Inspector General at the Agency headed by the 
Inspector General of the Agency who shall have the duties, 
responsibilities, and authorities specified in the Inspector 
General Act of 1978.
  [(b) Duality of Appointment.--An individual appointed to the 
position of Inspector General of the Department of State shall, 
by virtue of such appointment, also hold the position of 
Inspector General of the Agency.
  [(c) Utilization of Staff.--The Inspector General of the 
Agency shall utilize personnel of the Office of the Inspector 
General of the Department of State in performing the duties of 
the Inspector General of the Agency, and shall not appoint any 
individuals to positions within the Agency.
  [(d) References.--For purposes of this section, references in 
the Inspector General Act of 1978 to the establishment 
involved, to the head of the establishment, and to an Inspector 
General shall be deemed to be references to the Agency, the 
Director of the Agency, and Inspector General of the Agency, 
respectively, except to the extent inconsistent with this 
section.]

                       annual report to congress

  Sec. 51. (a) In General.--Not later than January 31 of each 
year, the President shall submit to the Speaker of the House of 
Representatives and to the chairman of the Committee on Foreign 
Relations of the Senate a report prepared by the [Director] 
Secretary, in consultation with [the Secretary of State,] the 
Secretary of Defense, the Secretary of Energy, the Chairman of 
the Joint Chiefs of Staff, and the Director of Central 
Intelligence, on the status of United States policy and actions 
with respect to arms control, nonproliferation, and 
disarmament. Such report shall include--
          (1)  * * *
          * * * * * * *

 public annual report on world military expenditures and arms transfers

  Sec. 52. Not later than December 31 of each year, the 
[Director] Secretary shall publish an unclassified report on 
world military expenditures and arms transfers. Such report 
shall provide detailed, comprehensive, and statistical 
information regarding military expenditures, arms transfers, 
armed forces, and related economic data for each country of the 
world. In addition, such report shall include pertinent in-
depth analyses as well as highlights with respect to arms 
transfers and proliferation trends and initiatives affecting 
such developments.

            [requirement for authorization of appropriations

  [Sec. 53. (a) Limitation on Obligation and Expenditure of 
Funds.--Notwithstanding any other provision of law, for the 
fiscal year 1994 and for each subsequent year, any funds 
appropriated for the Agency shall not be available for 
obligation or expenditure--
          [(1) unless such funds are appropriated pursuant to 
        an authorization of appropriations; or
          [(2) in excess of the authorized level of 
        appropriations.
  [(b) Subsequent Authorization.--The limitation under 
subsection (a) shall not apply to the extent that an 
authorization of appropriations is enacted after such funds are 
appropriated.
  [(c) Application.--The provisions of this section--
          [(1) may not be superseded, except by a provision of 
        law which specifically repeals, modifies, or supersedes 
        the provisions of this section; and
          [(2) shall not apply to, or affect in any manner, 
        permanent appropriations, trust funds, and other 
        similar accounts which are authorized by law and 
        administered by the Agency.]
          * * * * * * *

                TITLE V--ON-SITE INSPECTION ACTIVITIES 

                                findings

  Sec. 61. The Congress finds that--
          (1) under this Act, the [United States Arms Control 
        and Disarmament Agency] Department of State is charged 
        with the ``formulation and implementation of United 
        States arms control and disarmament policy in a manner 
        which will promote the national security'';
          (2) as defined in this Act, the terms ``arms 
        control'' and ``disarmament'' means ``the 
        identification, verification, inspection, limitation, 
        control, reduction, or elimination, of armed forces and 
        armaments of all kinds under international agreement to 
        establish an effective system of international 
        control'';
          (3) the On-Site Inspection Agency was established in 
        1988 pursuant to the INF Treaty to implement, on behalf 
        of the United States, the inspection provisions of the 
        INF Treaty;
          (4) on-site inspection activities under the INF 
        Treaty include--
                  (A) inspections in Russia, Ukraine, 
                Kazakhstan, Belarus, Turkmenistan, Uzbekistan, 
                the Czech Republic, and Germany,
                  (B) escort duties for teams visiting the 
                United States and the Basing Countries,
                  (C) establishment and operation of the Portal 
                Monitoring Facility in Russia, and
                  (D) support for the inspectors at the Portal 
                Monitoring Facility in Utah;
          (5) the On-Site Inspection Agency has additional 
        responsibilities to those specified in paragraph (4), 
        including the monitoring of nuclear tests pursuant to 
        the Threshold Test Ban Treaty and the Peaceful Nuclear 
        Explosions Treaty and the monitoring of the inspection 
        provisions of such additional arms control agreements 
        as the President may direct;
          (6) the personnel of the On-Site Inspection Agency 
        include civilian technical experts, civilian support 
        personnel, and members of the Armed Forces; and
          (7) the senior officials of the On-Site Inspection 
        Agency include representatives from [the United States 
        Arms Control and Disarmament Agency and] the Department 
        of State.

  policy coordination concerning implementation of on-site inspection 
                               provisions

  Sec. 62. (a) Interagency Coordination.--OSIA should receive 
policy guidance which is formulated through an interagency 
mechanism established by the President.
  (b) Role of the Secretary of Defense.--The Secretary of 
Defense should provide to OSIA appropriate policy guidance 
formulated through the interagency mechanism described in 
subsection (a) and operational direction, consistent with 
section 113(b) of title 10, United States Code.
  (c) Role of the [Director] Secretary.--The [Director] 
Secretary should provide to the interagency mechanism described 
in subsection (a) appropriate recommendations for policy 
guidance to OSIA consistent with sections 2(d), 22, and 34(c) 
of this Act.

        authorizations of appropriations for on-site inspection

  Sec. 63. There are authorized to be appropriated $49,830,000 
for fiscal year 1990 and $48,831,000 for fiscal year 1991 for 
the expenses of the On-Site Inspection Agency in carrying out 
on-site inspection activities pursuant to the INF Treaty.

SEC. 64. IMPROVING CONGRESSIONAL OVERSIGHT OF ON-SITE INSPECTION 
                    ACTIVITIES.

  (a) Report From the President.--Concurrent with the 
submission to the Congress of the request for authorization of 
appropriations for OSIA for fiscal year 1993, the President 
shall submit a report on OSIA to the Committee on Foreign 
Affairs of the House of Representatives, the Committee on 
Foreign Relations of the Senate, and the Committees on Armed 
Services of the House of Representatives and Senate. The report 
shall include a review of--
          (1) the history of OSIA, including how, when, and 
        under what auspices it was established, including the 
        applicable texts of the relevant executive orders;
          (2) the missions and tasks assigned to OSIA to date;
          (3) any additional missions and tasks likely to be 
        assigned to OSIA during fiscal year 1993;
          (4) the budgetary history of OSIA; and
          (5) the extent to which OSIA plays a role in arms 
        control policy formulation and operational 
        implementation.
  (b) Review of Certain Reprogramming Notifications.--Any 
notification submitted to the Congress with respect to a 
proposed transfer, reprogramming, or reallocation of funds from 
or within the budget of OSIA shall also be submitted to the 
Committee on Foreign Affairs of the House of Representatives 
and the Committee on Foreign Relations of the Senate, and shall 
be subject to review by those committees.

                              definitions

  Sec. 65. As used in this title--
          (1) the term ``INF Treaty'' means the Treaty Between 
        the United States and the Union of Soviet Socialist 
        Republics on the Elimination of Their Intermediate-
        Range and Shorter-Range Missiles (signed at Washington, 
        December 8, 1987);
          (2) the term ``OSIA'' means the On-Site Inspection 
        Agency established by the President, or such other 
        agency as may be designated by the President to carry 
        out the on-site inspection provisions of the INF 
        Treaty;
          (3) the term ``Peaceful Nuclear Explosions Treaty'' 
        means the Treaty Between the United States of America 
        and the Union of Soviet Socialist Republics on 
        Underground Nuclear Explosions for Peaceful Purposes 
        (signed at Washington and Moscow, May 28, 1976); and
          (4) the term ``Threshold Test Ban Treaty'' means the 
        Treaty Between the United States of America and the 
        Union of Soviet Socialist Republics on the Limitation 
        of Underground Nuclear Weapons Tests (signed at Moscow, 
        July 3, 1974).
                              ----------                              


                        ARMS EXPORT CONTROL ACT

          * * * * * * *

                  CHAPTER 3--MILITARY EXPORT CONTROLS

          * * * * * * *
  Sec. 36. Reports on Commercial and Governmental Military 
Exports; Congressional Action.--(a)  * * *
  (b)(1) In the case of any letter of offer to sell any defense 
articles or services under this Act for $50,000,000 or more, 
any design and construction services for $200,000,000 or more, 
or any major defense equipment for $14,000,000 or more, before 
such letter of offer is issued, the President shall submit to 
the Speaker of the House of Representatives and to the chairman 
of the Committee on Foreign Relations of the Senate a numbered 
certification with respect to such offer to sell containing the 
information specified in clauses (i) through (iv) of subsection 
(a), or (in the case of a sale of design and construction 
services) the information specified in clauses (A) through (D) 
of paragraph (9) of subsection (a), and a description, 
containing the information specified in paragraph (8) of 
subsection (a), of any contribution, gift, commission, or fee 
paid or offered or agreed to be paid in order to solicit, 
promote, or otherwise to secure such letter of offer. Such 
numbered certifications shall also contain an item, classified 
if necessary, identifying the sensitivity of technology 
contained in the defense articles, defense services, or design 
and construction services proposed to be sold, and a detailed 
justification of the reasons necessitating the sale of such 
articles or services in view of the sensitivity of such 
technology. In a case in which such articles or services listed 
on the Missile Technology Control Regime Annex are intended to 
support the design, development, or production of a Category I 
space launch vehicle system (as defined in section 74), such 
report shall include a description of the proposed export and 
rationale for approving such export, including the consistency 
of such export with United States missile nonproliferation 
policy. Each such numbered certification shall contain an item 
indicating whether any offset agreement is proposed to be 
entered into in connection with such letter of offer to sell 
(if known on the date of transmittal of such certification). In 
addition, the President shall, upon the request of such 
committee or the Committee on Foreign Affairs of the House of 
Representatives, transmit promptly to both such committees a 
statement setting forth, to the extent specified in such 
request--
          (A)  * * *
          * * * * * * *
          (D) an evaluation, prepared by the [Director of the 
        Arms Control and Disarmament Agency in consultation 
        with the Secretary of State and] Secretary of State in 
        consultation with the Secretary of Defense, of the 
        manner, if any, in which the proposed sale would--
                  (i)  * * *
          * * * * * * *
  Sec. 38. Control of Arms Exports and Imports.--(a)(1)  * * *
  (2) Decisions on issuing export licenses under this section 
shall be made in coordination with the [Director of the United 
States Arms Control and Disarmament Agency, taking into account 
the Director's] Secretary of State, taking into account the 
Secretary's assessment as to whether the export of an article 
would contribute to an arms race, aid in the development of 
weapons of mass destruction, support international terrorism, 
increase the possibility of outbreak or escalation of conflict, 
or prejudice the development of bilateral or multilateral arms 
control or nonproliferation agreements or other arrangements. 
[The Director of the Arms Control and Disarmament Agency is 
authorized, whenever the Director] The Secretary of State is 
authorized, whenever the Secretary determines that the issuance 
of an export license under this section would be detrimental to 
the national security of the United States, to recommend to the 
President that such export license be disapproved.
          * * * * * * *

CHAPTER 3A--END-USE MONITORING OF DEFENSE ARTICLES AND DEFENSE SERVICES

          * * * * * * *
  Sec. 42. General Provisions.--(a)(1) In carrying out this 
Act, special emphasis shall be placed on procurement in the 
United States, but, subject to the provisions of subsection (b) 
of this section, consideration shall also be given to 
coproduction or licensed production outside the United States 
of defense articles of United States origin when such 
production best serves the foreign policy, national security, 
and economy of the United States. In evaluating any sale 
proposed to be made pursuant to this Act, there shall be taken 
into consideration (A) the extent to which the proposed sale 
damages or infringes upon licensing arrangements whereby United 
States entities have granted licenses for the manufacture of 
the defense articles selected by the purchasing country to 
entities located in friendly foreign countries, which licenses 
result in financial returns to the United States, (B) the 
portion of the defense articles so manufactured which is of 
United States origin, and (C) the assessment of the [Director 
of the United States Arms Control and Disarmament Agency] 
Secretary of State as to whether, and the extent to which, such 
sale might contribute to an arms race, aid in the development 
of weapons of mass destruction, support international 
terrorism, increase the possibility of outbreak or escalation 
of conflict, or prejudice the development of bilateral or 
multilateral arms control or nonproliferation agreements or 
other arrangements.
  (2) Any proposed sale made pursuant to this Act shall be 
approved only after consultation with the [Director of the 
United States Arms Control and Disarmament Agency] Secretary of 
State. The [Director of the Arms Control and Disarmament Agency 
is authorized, whenever the Director] Secretary of State, 
whenever the Secretary determines that a sale under this 
section would be detrimental to the national security of the 
United States, to recommend to the President that such sale be 
disapproved.
          * * * * * * *

  CHAPTER 7--CONTROL OF MISSILES AND MISSILE EQUIPMENT OR TECHNOLOGY 

  Sec. 71. Licensing.--
  (a) Establishment of List of Controlled Items.--The Secretary 
of State, in consultation with the Secretary of Defense[, the 
Director of the Arms Control and Disarmament Agency,], 
Secretary of State, and the heads of other appropriate 
departments and agencies, shall establish and maintain, as part 
of the United States Munitions List, a list of all items on the 
MTCR Annex the export of which is not controlled under section 
6(l) of the Export Administration Act of 1979.
  (b) Referral of License Applications.--(1) A determination of 
the Secretary of State to approve a license for the export of 
an item on the list established under subsection (a) may be 
made only after the license application is referred to the 
Secretary of Defense and the [Director of the United States 
Arms Control and Disarmament Agency] Secretary of State.
  (2) Within 10 days after a license is issued for the export 
of an item on the list established under subsection (a), the 
Secretary of State shall provide to the Secretary of Defense, 
the Secretary of Commerce, and the [Director of the United 
States Arms Control and Disarmament Agency] Secretary of State 
the license application and accompanying documents issued to 
the applicant, to the extent that the relevant Secretary [or 
the Director] indicates the need to receive such application 
and documents.
  (c) Information Sharing.--The Secretary of State shall 
establish a procedure for sharing information with appropriate 
officials of the intelligence community, as determined by the 
Director of Central Intelligence, with the [Director of the 
United States Arms Control and Disarmament Agency,] Secretary 
of State and with other appropriate Government agencies, that 
will ensure effective monitoring of transfers of MTCR equipment 
or technology and other missile technology.
          * * * * * * *
  Sec. 73. Transfers of Missile Equipment or Technology by 
Foreign Persons.
  (a)  * * *
          * * * * * * *
  (d) Advisory Opinions.--The Secretary of State, in 
consultation with the Secretary of Defense, the Secretary of 
Commerce, and the [Director of the United States Arms Control 
and Disarmament Agency] Secretary of State, may, upon the 
request of any person, issue an advisory opinion to that person 
as to whether a proposed activity by that person would subject 
that person to sanctions under this section. Any person who 
relies in good faith on such an advisory opinion which states 
that the proposed activity would not subject a person to such 
sanctions, and any person who thereafter engages in such 
activity, may not be made subject to such sanctions on account 
of such activity.
          * * * * * * *
                              ----------                              


        SECTION 1706 OF THE UNITED STATES INSTITUTE OF PEACE ACT

                           board of directors

    Sec. 1706. (a) The powers of the Institute shall be vested 
in a Board of Directors unless otherwise specified in this 
title.
    (b) The Board shall consist of fifteen voting members as 
follows:
          (1) * * *
          * * * * * * *
          [(3) The Director of the Arms Control and Disarmament 
        Agency (or if the Director so designates, another 
        officer of that Agency who was appointed with the 
        advice and consent of the Senate).]
          [(4)] (3) The president of the National Defense 
        University (or if the president so designates, the vice 
        president of the National Defense University).
          [(5) Eleven] (4) Twelve individuals appointed by the 
        President, by and with the advice and consent of the 
        Senate.
          * * * * * * *
                              ----------                              


                       ATOMIC ENERGY ACT OF 1954

          * * * * * * *

                         TITLE I--ATOMIC ENERGY

          * * * * * * *

                  CHAPTER 6. SPECIAL NUCLEAR MATERIAL

          * * * * * * *
  Sec. 57. Prohibition.--
  a.  * * *
  b. It shall be unlawful for any person to directly or 
indirectly engage in the production of any special nuclear 
material outside of the United States except (1) as 
specifically authorized under an agreement for cooperation made 
pursuant to section 123, including a specific authorization in 
a subsequent arrangement under section 131 of this Act, or (2) 
upon authorization by the Secretary of Energy after a 
determination that such activity will not be inimical to the 
interest of the United States: Provided, That any such 
determination by the Secretary of Energy shall be made only 
with the concurrence of the Department of State and after 
consultation with [the Arms Control and Disarmament Agency,] 
the Nuclear Regulatory Commission, the Department of Commerce, 
and the Department of Defense. The Secretary of Energy shall, 
within ninety days after the enactment of the Nuclear Non-
Proliferation Act of 1978, establish orderly and expeditious 
procedures, including provision for necessary administrative 
actions and inter-agency memoranda of understanding, which are 
mutually agreeable to the Secretaries of State, Defense, and 
Commerce, [the Director of the Arms Control and Disarmament 
Agency,] and the Nuclear Regulatory Commission for the 
consideration of requests for authorization under this 
subsection. Such procedures shall include, at a minimum, 
explicit direction on the handling of such requests, express 
deadlines for the solicitation and collection of the views of 
the consulted agencies (with identified officials responsible 
for meeting such deadlines), an interagency coordinating 
authority to monitor the processing of such requests, 
predetermined procedures for the expeditious handling of intra-
agency and inter-agency disagreements and appeals to higher 
authorities, frequent meetings of inter-agency administrative 
coordinators to review the status of all pending requests, and 
similar administrative mechanisms. To the extent practicable, 
an applicant should be advised of all the information required 
of the applicant for the entire process for every agency's 
needs at the beginning of the process. Potentially 
controversial requests should be identified as quickly as 
possible so that any required policy decisions or diplomatic 
consultations can be initiated in a timely manner. An immediate 
effort should be undertaken to establish quickly any necessary 
standards and criteria, including the nature of any required 
assurances or evidentiary showings, for the decision required 
under this subsection. The processing of any request proposed 
and filed as of the date of enactment of the Nuclear Non-
Proliferation Act of 1978 shall not be delayed pending the 
development and establishment of procedures to implement the 
requirements of this subsection. Any trade secrets or 
proprietary information submitted by any person seeking an 
authorization under this subsection shall be afforded the 
maximum degree of protection allowable by law: Provided 
further, That the export of component parts as defined in 
subsection 11 v. (2) or 11 cc. (2) shall be governed by 
sections 109 and 126 of this Act: Provided further, That 
notwithstanding subsection 402(d) of the Department of Energy 
Organization Act (Public Law 95-91), the Secretary of Energy 
and not the Federal Energy Regulatory Commission, shall have 
sole jurisdiction within the Department of Energy over any 
matter arising from any function of the Secretary of Energy in 
this section, section 54 d., section 64, or section 111 b.
          * * * * * * *

                  CHAPTER 11. INTERNATIONAL ACTIVITIES

          * * * * * * *
  Sec. 123. Cooperation With Other Nations.--
          No cooperation with any nation, group of nations or 
        regional defense organization pursuant to section 53, 
        54 a., 57, 64, 82, 91, 103, 104, or 144 shall be 
        undertaken until--
                  a. the proposed agreement for cooperation has 
                been submitted to the President, which proposed 
                arrangement shall include the terms, 
                conditions, duration, nature, and scope of the 
                cooperation; and shall include the following 
                requirements:
                          (1)  * * *
          * * * * * * *
                          (9) except in the case of agreements 
                        for cooperation arranged pursuant to 
                        subsection 91 c., 144 b., 144 c., or 
                        144 d., a guaranty by the cooperating 
                        party that any special nuclear 
                        material, production facility, or 
                        utilization facility produced or 
                        constructed under the jurisdiction of 
                        the cooperating party by or through the 
                        use of any sensitive nuclear technology 
                        transferred pursuant to such agreement 
                        for cooperation will be subject to all 
                        the requirements specified in this 
                        subsection.
                The President may exempt a proposed agreement 
                for cooperation (except an agreement arranged 
                pursuant to subsection 91 c., 144 b., 144 c., 
                or 144 d.) from any of the requirements of the 
                foregoing sentence if he determines that 
                inclusion of any such requirement would be 
                seriously prejudicial to the achievement of 
                United States non-proliferation objectives or 
                otherwise jeopardize the common defense and 
                security. Except in the case of those 
                agreements for cooperation arranged pursuant to 
                subsection 91 c., 144 b., 144 c., or 144 d., 
                any proposed agreement for cooperation shall be 
                negotiated by the Secretary of State, with the 
                technical assistance and concurrence of the 
                Secretary of Energy [and in consultation with 
                the Director of the Arms Control and 
                Disarmament Agency (``the Director'')]; and 
                after consultation with the Commission shall be 
                submitted to the President jointly by the 
                Secretary of State and the Secretary of Energy 
                accompanied by the views and recommendations of 
                the Secretary of State, the Secretary of 
                Energy, the Nuclear Regulatory Commission, [and 
                the Director] and the Secretary of Defense, who 
                shall also provide to the President an 
                unclassified Nuclear Proliferation Assessment 
                Statement (A) which shall analyze the 
                consistency of the text of the proposed 
                agreement for cooperation with all the 
                requirements of this Act, with specific 
                attention to whether the proposed agreement is 
                consistent with each of the criteria set forth 
                in this subsection, and (B) regarding the 
                adequacy of the safeguards and other control 
                mechanisms and the peaceful use assurances 
                contained in the agreement for cooperation to 
                ensure that any assistance furnished thereunder 
                will not be used to further any military or 
                nuclear explosive purpose. In the case of those 
                agreements for cooperation arranged pursuant to 
                subsection 91 c., 144 b., 144 c., or 144 d., 
                any proposed agreement for cooperation shall be 
                submitted to the President by the Secretary of 
                Energy or, in the case of those agreements for 
                cooperation arranged pursuant to subsection 91 
                c. 144 b., or 144 d. which are to be 
                implemented by the Department of Defense, by 
                the Secretary of Defense;
          * * * * * * *
                  d. the proposed agreement for cooperation (if 
                arranged pursuant to subsection 91 c., 144 b., 
                144 c., or 144 d., or if entailing 
                implementation of section 53, 54 a., 103, or 
                104 in relation to a reactor that may be 
                capable of producing more than five thermal 
                megawatts or special nuclear material for use 
                in connection therewith) has been submitted to 
                the Congress, together with the approval and 
                determination of the President, for a period of 
                sixty days of continuous session (as defined in 
                subsection 130 g. of this Act) and referred to 
                the Committee on Foreign Affairs of the House 
                of Representatives and the Committee on Foreign 
                Relations of the Senate, and in addition, in 
                the case of a proposed agreement for 
                cooperation arranged pursuant to subsection 91 
                c., 144 b., 144 c., or 144 d., the Committee on 
                Armed Services of the House of Representatives 
                and the Committee on Armed Services of the 
                Senate, but such proposed agreement for 
                cooperation shall not become effective if 
                during such sixty-day period the Congress 
                adopts, and there is enacted, a joint 
                resolution stating in substance that the 
                Congress does not favor the proposed agreement 
                for cooperation: Provided, That the sixty-day 
                period shall not begin until a Nuclear 
                Proliferation Assessment Statement prepared by 
                the [Director of the Arms Control and 
                Disarmament Agency] Secretary of Defense, when 
                required by subsection 123 a., has been 
                submitted to the Congress: Provided further, 
                That an agreement for cooperation exempted by 
                the President pursuant to subsection a. from 
                any requirement contained in that subsection 
                shall not become effective unless the Congress 
                adopts, and there is enacted, a joint 
                resolution stating that the Congress does favor 
                such agreement. During the sixty-day period the 
                Committee on Foreign Affairs of the House of 
                Representatives and the Committee on Foreign 
                Relations of the Senate shall each hold 
                hearings on the proposed agreement for 
                cooperation and submit a report to their 
                respective bodies recommending whether it 
                should be approved or disapproved. Any such 
                proposed agreement for cooperation shall be 
                considered pursuant to the procedures set forth 
                in section 130 i. of this Act.
          Following submission of a proposed agreement for 
        cooperation (except an agreement for cooperation 
        arranged pursuant to subsection 91 c., 144 b., 144 c., 
        or 144 d.) to the Committee on Foreign Affairs of the 
        House of Representatives and the Committee on Foreign 
        Relations of the Senate, the Nuclear Regulatory 
        Commission, the Department of State, the Department of 
        Energy, [the Arms Control and Disarmament Agency,] and 
        the Department of Defense shall, upon the request of 
        either of those committees, promptly furnish to those 
        committees their views as to whether the safeguards and 
        other controls contained therein provide an adequate 
        framework to ensure that any exports as contemplated by 
        such agreement will not be inimical to or constitute an 
        unreasonable risk to the common defense and security.
  If, after the date of enactment of the Nuclear Non-
Proliferation Act of 1978, the Congress fails to disapprove a 
proposed agreement for cooperation which exempts the recipient 
nation from the requirement set forth in subsection 123 a. (2), 
such failure to act shall constitute a failure to adopt a 
resolution of disapproval pursuant to subsection 128 b. (3) for 
purposes of the Commission's consideration of applications and 
requests under section 126 a. (2) and there shall be no 
congressional review pursuant to section 128 of any subsequent 
license or authorization with respect to that state until the 
first such license or authorization which is issued after 
twelve months from the elapse of the sixty-day period in which 
the agreement for cooperation in question is reviewed by the 
Congress.
                              ----------                              


                 NUCLEAR NON-PROLIFERATION ACT OF 1978

          * * * * * * *

                              DEFINITIONS

    Sec. 4. (a) As used in this Act, the term--
          (1) ``Commission'' means the Nuclear Regulatory 
        Commission;
          [(2) ``Director'' means the Director of the Armed 
        Control and Disarmament Agency;]
          * * * * * * *

  TITLE I--UNITED STATES INITIATIVES TO PROVIDE ADEQUATE NUCLEAR FUEL 
                                 SUPPLY

          * * * * * * *

                      uranium enrichment capacity

    Sec. 102. The Secretary of Energy is directed to initiate 
construction planning and design, construction, and operation 
activities for expansion of uranium enrichment capacity, as 
elsewhere provided by law. Further the Secretary as well as the 
Nuclear Regulatory Commission, [The Secretary of State, and the 
Director of the Arms Control and Disarmament Agency] and the 
Secretary of State are directed to establish and implement 
procedures which will ensure to the maximum extent feasible, 
consistent with this Act, orderly processing of subsequent 
arrangements and export licenses with minimum time delay.
          * * * * * * *

                     TITLE VI--EXECUTIVE REPORTING

          * * * * * * *

                           additional reports

    Sec. 602. (a) * * *
          * * * * * * *
    (c) The Department of State, the Department of Defense, 
[the Arms Control and Disarmament Agency,] the Department of 
Commerce, the Department of Energy, and the Commission shall 
keep the Committees on Foreign Relations and Governmental 
Affairs of the Senate and the Committee on Foreign Affairs of 
the House of Representatives fully and currently informed with 
respect to their activities to carry out the purposes and 
policies of this Act and to otherwise prevent proliferation, 
and with respect to the current activities of foreign nations 
which are of significance from the proliferation standpoint.
          * * * * * * *
                              ----------                              


                      TITLE 5, UNITED STATES CODE

          * * * * * * *

                          PART III--EMPLOYEES

          * * * * * * *

                     Subpart D--Pay and Allowances

          * * * * * * *

                   CHAPTER 53--PAY RATES AND SYSTEMS

          * * * * * * *

              SUBCHAPTER II--EXECUTIVE SCHEDULE PAY RATES

          * * * * * * *

Sec. 5313. Positions at level II

  Level II of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Deputy Secretary of Defense.
          Deputy Secretary of State.
          [Administrator, Agency for International 
        Development.]
          Administrator of the National Aeronautics and Space 
        Administration.
          Deputy Secretary of Veterans Affairs.
          Deputy Secretary of the Treasury.
          Deputy Secretary of Transportation.
          Chairman, Nuclear Regulatory Commission.
          Chairman, Council of Economic Advisers.
          Chairman, Board of Governors of the Federal Reserve 
        System.
          Director of the Office of Science and Technology.
          [Director of the United States Arms Control and 
        Disarmament Agency.
          [Director of the United States Information Agency.]
          * * * * * * *

Sec. 5314. Positions at level III

  Level III of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Solicitor General of the United States.
          Under Secretary of Commerce, Under Secretary of 
        Commerce for Economic Affairs, Under Secretary of 
        Commerce for Export Administration and Under Secretary 
        of Commerce for Travel and Tourism.
          Under Secretaries of State (5).
          Under Secretaries of the Treasury (3).
          Administrator of General Services.
          Administrator of the Small Business Administration.
          [Deputy Administrator, Agency for International 
        Development.]
          Chairman of the Merit Systems Protection Board.
          * * * * * * *
          [Deputy Director of the United States Arms Control 
        and Disarmament Agency.]
          * * * * * * *

Sec. 5315. Positions at level IV

  Level IV of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Deputy Administrator of General Services.
          Associate Administrator of the National Aeronautics 
        and Space Administration.
          [Assistant Administrators, Agency for International 
        Development (6).
          [Regional Assistant Administrators, Agency for 
        International Development (4).]
          Under Secretary of the Air Force.
          * * * * * * *
          [Deputy Director of the United States Information 
        Agency.]
          * * * * * * *
          [Assistant Directors, United States Arms Control and 
        Disarmament Agency (4).
          [Inspector General, United States Information 
        Agency.]
          * * * * * * *
          [Inspector General, Agency for International 
        Development.]
          * * * * * * *
          [Director of the International Broadcasting Bureau, 
        the United States Information Agency] Director of the 
        International Broadcasting Office, the Department of 
        State.
          Inspector General, Social Security Administration.
          The Commissioner of Labor Statistics, Department of 
        Labor.
          Administrator, Rural Utilities Service, Department of 
        Agriculture.

Sec. 5316. Positions at level V

  Level V of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Administrator, Bonneville Power Administration, 
        Department of the Interior.
          Administrator of the National Capital Transportation 
        Agency.
          Associate Administrators of the Small Business 
        Administration (4).
          * * * * * * *
          [Deputy Director, Policy and Plans, United States 
        Information Agency.]
          * * * * * * *
          [General Counsel of the Agency for International 
        Development.]
          * * * * * * *
                              ----------                              


                     INSPECTOR GENERAL ACT OF 1978

          * * * * * * *

     [special provisions relating to the agency for international 
                              development

  [Sec. 8A. (a) In addition to the other duties and 
responsibilities specified in this Act, the Inspector General 
of the Agency for International Development--
          [(1) shall supervise, direct, and control all 
        security activities relating to the programs and 
        operations of that Agency, subject to the supervision 
        of the Administrator of that Agency; and
          [(2) to the extent requested by the Director of the 
        United States International Development Cooperation 
        Agency (after consultation with the Administrator of 
        the Agency for International Development), shall 
        supervise, direct, and control all audit, 
        investigative, and security activities relating to 
        programs and operations within the United States 
        International Development Cooperation Agency.
  [(b) In addition to the Assistant Inspector Generals provided 
for in section 3(d) of this Act, the Inspector General of the 
Agency for International Development shall, in accordance with 
applicable laws and regulations governing the civil service, 
appoint an Assistant Inspector General for Security who shall 
have the responsibility for supervising the performance of 
security activities relating to programs and operations of the 
Agency for International Development.
  [(c) The semiannual reports required to be submitted to the 
Administrator of the Agency for International Development 
pursuant to section 5(b) of this Act shall also be submitted to 
the Director of the United States International Development 
Cooperation Agency.
  [(d) In addition to the officers and employees provided for 
in section 6(a)(6) of this Act, members of the Foreign Service 
may, at the request of the Inspector General of the Agency for 
International Development, be assigned as employees of the 
Inspector General. Members of the Foreign Service so assigned 
shall be responsible solely to the Inspector General, and the 
Inspector General (or his or her designee) shall prepare the 
performance evaluation reports for such members.
  [(e) In establishing and staffing field offices pursuant to 
section 6(c) of this Act, the Administrator of the Agency for 
International Development shall not be bound by overseas 
personnel ceilings established under the Monitoring Overseas 
Direct Employment policy.
  [(f) The reference in section 7(a) of this Act to an employee 
of the establishment shall, with respect to the Inspector 
General of the Agency for International Development, be 
construed to include an employee of or under the United States 
International Development Cooperation Agency.
  [(g) The Inspector General of the Agency for International 
Development shall be in addition to the officers provided for 
in section 624(a) of the Foreign Assistance Act of 1961.
  [(h) As used in this Act, the term ``Agency for International 
Development'' includes any successor agency primarily 
responsible for administering part I of the Foreign Assistance 
Act of 1961.]
          * * * * * * *

                              definitions

  Sec. 11. As used in this Act--
          (1) the term ``head of the establishment'' means the 
        Secretary of Agriculture, Commerce, Defense, Education, 
        Energy, Health and Human Services, Housing and Urban 
        Development, the Interior, Labor, State, 
        Transportation, or the Treasury; the Attorney General; 
        [the Administrator of the Agency for International 
        Development,] Environmental Protection, General 
        Services, National Aeronautics and Space, or Small 
        Business, or Veterans' Affairs; the Director of the 
        Federal Emergency Management Agency[, the Office of 
        Personnel Management or the United States Information 
        Agency] or the Office of Personnel Management; the 
        Chairman of the Nuclear Regulatory Commission or the 
        Railroad Retirement Board; the Chairperson of the 
        Thrift Depositor Protection Oversight Board; the Chief 
        Executive Officer of the Corporation for National and 
        Community Service; the Administrator of the Community 
        Development Financial Institutions Fund; and the chief 
        officer of the Resolution Trust Corporation; or the 
        Commissioner of Social Security, Social Security 
        Administration; as the case may be;
          (2) the term ``establishment'' means the Department 
        of Agriculture, Commerce, Defense, Education, Energy, 
        Health and Human Services, Housing and Urban 
        Development, the Interior, Justice, Labor, State, 
        Transportation, or the Treasury; [the Agency for 
        International Development,] the Community Development 
        Financial Institutions Fund, the Environmental 
        Protection Agency, the Federal Emergency Management 
        Agency, the General Services Administration, the 
        National Aeronautics and Space Administration, the 
        Nuclear Regulatory Commission, the Office of Personnel 
        Management, the Railroad Retirement Board, the 
        Resolution Trust Corporation, the Federal Deposit 
        Insurance Corporation, the Small Business 
        Administration, [the United States Information Agency,] 
        the Corporation for National and Community Service,, or 
        the Veterans' Administration, or the Social Security 
        Administration; as the case may be;
          * * * * * * *
                              ----------                              


     UNITED STATES INFORMATION AND EDUCATIONAL EXCHANGE ACT OF 1948

 AN ACT To promote the better understanding of the United States among 
 the peoples of the world and to strengthen cooperative international 
                               relations.

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

           TITLE I--SHORT TITLE, OBJECTIVES, AND DEFINITIONS

                              short title

  Section 1. This Act may be cited as the ``United States 
Information and Educational Exchange Act of 1948''.
          * * * * * * *

                  TITLE III--ASSIGNMENT OF SPECIALISTS

                         persons to be assigned

  Sec. 301. The [Director of the United States Information 
Agency] Secretary of State is authorized, when the government 
of another country is desirous of obtaining the services of a 
person having special scientific or other technical or 
professional qualifications, from time to time to assign or 
authorize the assignment for service, to or in cooperation with 
such government, any person in the employ or service of the 
Government of the United States who has such qualifications, 
with the approval of the Government agency in which such person 
is employed or serving. No person shall be assigned for service 
to or in cooperation with the government of any country unless 
(1) the [Director] Secretary of State finds that such 
assignment is necessary in the national interest of the United 
States, or (2) such government agrees to reimburse the United 
States in an amount equal to the compensation, travel expenses, 
and allowances payable to such person during the period of such 
assignment in accordance with the provisions of section 302, or 
(3) such government shall have made an advance of funds, 
property, or services as provided in section 902. Nothing in 
this Act, however, shall authorize the assignment of such 
personnel for service relating to the organization, training, 
operation, development, or combat equipment of the armed forces 
of a foreign government.

                         status and allowances

  Sec. 302. Any person in the employ or service of the 
Government of the United States, while assigned for service to 
or in cooperation with another government under the authority 
of this Act, shall be considered, for the purpose of preserving 
his rights, allowances, and privileges as such, an officer or 
employee of the Government of the United States and of the 
Government agency from which assigned and he shall continue to 
receive compensation from that agency. He may also receive, 
under such regulations as the President may prescribe, 
representation allowances similar to those allowed under 
section 905 of the Foreign Service Act of 1980. The 
authorization of such allowances and other benefits and the 
payment thereof out of any appropriations available therefor 
shall be considered as meeting all the requirements of section 
5536 of title 5, United States Code.

             acceptance of office under another government

  Sec. 303. Any person in the employ or service of the 
Government of the United States, while assigned for service to 
or in cooperation with another government under authority of 
this Act may, at the discretion of his Government agency, with 
the concurrence of the [Director of the United States 
Information Agency] Secretary of State, and without additional 
compensation therefor, accept an office under the government to 
which he is assigned, if the acceptance of such an office in 
the opinion of such agency is necessary to permit the effective 
performance of duties for which he is assigned, including the 
making or approving on behalf of such foreign government the 
disbursement of funds provided by such government or of 
receiving from such foreign government funds for deposit and 
disbursement on behalf of such government, in carrying out 
programs undertaken pursuant to this Act: Provided, however, 
That such acceptance of office shall in no case involve the 
taking of an oath of allegiance to another government.
          * * * * * * *

   TITLE V--DISSEMINATING INFORMATION ABOUT THE UNITED STATES ABROAD

                         general authorization

  Sec. 501. (a) The Secretary is authorized, when he finds it 
appropriate, to provide for the preparation, and dissemination 
abroad, of information about the United States, its people, and 
its policies, through press, publications, radio, motion 
pictures, and other information media, and through information 
centers and instructors abroad. Subject to subsection (b), any 
such information (other than ``Problems of Communism'' and the 
``English Teaching Forum'' which may be sold by the Government 
Printing Office) shall not be disseminated within the United 
States, its territories, or possessions, but, on request, shall 
be available in the English language at the Department of 
State, at all reasonable times following its release as 
information abroad, for examination only by representatives of 
United States press associations, newspapers, magazines, radio 
systems, and stations, and by research students and scholars, 
and, on request, shall be made available for examination only 
to Members of Congress.
  (b)(1) The [Director of the United States Information Agency] 
Secretary of State shall make available to the Archivist of the 
United States, for domestic distribution, motion pictures, 
films, videotapes, and other material prepared for 
dissemination abroad 12 years after the initial dissemination 
of the material abroad or, in the case of such material not 
disseminated abroad, 12 years after the preparation of the 
material.
  (2) The [Director of the United States Information Agency] 
Secretary of State shall be reimbursed for any attendant 
expenses. Any reimbursement to the [Director] Secretary of 
State pursuant to this subsection shall be credited to the 
applicable appropriation of the [United States Information 
Agency] Department of State.
  (3) The Archivist shall be the official custodian of the 
material and shall issue necessary regulations to ensure that 
persons seeking its release in the United States have secured 
and paid for necessary United States rights and licenses and 
that all costs associated with the provision of the material by 
the Archivist shall be paid by the persons seeking its release. 
The Archivist may charge fees to recover such costs, in 
accordance with section 2116(c) of title 44, United States 
Code. Such fees shall be paid into, administered, and expended 
as part of the National Archives Trust Fund.
          * * * * * * *

          [usia] department of state satellite and television

  Sec. 505. (a) In General.--The [Director of the United States 
Information Agency] Secretary of State is authorized to lease 
or otherwise acquire time on commercial or United States 
Government satellites for the purpose of transmitting materials 
and programs to posts and other users abroad.
          (1) [USIA-TV] DEPARTMENT OF STATE-TV will serve as a 
        consistently reliable and authoritative source of news. 
        [USIA-TV] DEPARTMENT OF STATE-TV news will be accurate 
        and objective.
  (b) Broadcast Principles.--The Congress finds that the long-
term interests of the United States are served by communicating 
directly with the peoples of the world by television. [To be 
effective, the United States Information Agency] To be 
effective in carrying out this subsection, the Department of 
State must win the attention and respect of viewers. These 
principles will therefore govern the [Agency's] Department of 
State's television broadcasts (hereinafter in this section 
referred to as ``[USIA-TV] DEPARTMENT OF STATE-TV''):
          (2) [USIA-TV] DEPARTMENT OF STATE-TV will represent 
        the United States, not any single segment of American 
        society and will, therefore, present a balanced and 
        comprehensive projection of significant American 
        thought and institutions.
          (3) [USIA-TV] DEPARTMENT OF STATE-TV will present the 
        policies of the United States clearly and effectively 
        and will also present responsible discussions and 
        opinion on these policies.
  (c) Programs.--The [Director of the United States Information 
Agency] Secretary of State is authorized to produce, acquire, 
or broadcast television programs, via satellite, only if such 
programs--
          (1) are interactive, consisting of interviews among 
        participants in different locales;
          (2) cover news, public affairs, or other current 
        events;
          (3) cover official activities of government, Federal 
        or State, including congressional proceedings and news 
        briefings of any agency of the Executive branch; or
          (4) are of an artistic or scientific character or are 
        otherwise representative of American culture.
  (d) Costs.--When a comparable program produced by United 
States public or commercial broadcasters and producers is 
available at a cost which is equal to or less than the cost of 
production by [USIA-TV] DEPARTMENT OF STATE-TV, the [Director 
of the United States Information Agency] Secretary of State 
shall use such materials in preference to [USIA-TV] DEPARTMENT 
OF STATE-TV produced materials.
  [(e) Allocation of Funds.--(1) Of the funds authorized to be 
appropriated to the United States Information Agency not more 
than $12,000,000 for the fiscal year 1990 and not more than 
$12,480,000 for the fiscal year 1991 may be obligated or 
expended for USIA-TV.
  [(2) The United States Information Agency shall prepare and 
submit to the Congress quarterly reports which contain a 
detailed explanation of expenditures for USIA-TV during the 
fiscal years 1990 and 1991. Such reports shall contain specific 
justification and supporting information pertaining to all 
programs, particularly those described in subsection (c)(4), 
that were produced in-house by USIA-TV. Each such report shall 
include a statement by the Director of the United States 
Information Agency that, according to the best information 
available to the United States Information Agency, no 
comparable United States commercially-produced or public 
television program is available at a cost which is equal to or 
less than the cost of production by USIA-TV.
  [(3) Of the funds authorized to be appropriated to the United 
States Information Agency, $1,500,000 for the fiscal year 1990 
and $1,500,000 for the fiscal year 1991 shall be available only 
for the purchase or use of programs produced with grants from 
the Corporation for Public Broadcasting or produced by United 
States public broadcasters.]

                   voice of america hiring practices

  Sec. 506. (a) Prohibition.--After the date of enactment of 
this section, the Voice of America shall not select candidates 
for employment who must be or are preapproved for employment at 
the Voice of America by a foreign government or an entity 
controlled by a foreign government.
  (b) Exception.--The prohibition referred to in this section 
shall not apply to--
          (1) participants in the Voice of America's exchange 
        programs; or
          (2) clerical, technical, or maintenance staff at 
        Voice of America offices in foreign countries.
  (c) Report.--If the [Director of the United States 
Information Agency] Secretary of State determines that the 
prohibition under subsection (a) would require the termination 
of a specific Voice of America foreign language service, then, 
not less than 90 days before the [Agency] Department of State 
begins to recruit such candidates, the [Director] Secretary of 
State shall submit to the Committee on Foreign Relations of the 
Senate and the Committee on Foreign Affairs of the House of 
Representatives a report concerning--
          (1) the number and location of speakers of the 
        applicable foreign language who could be recruited by 
        the Voice of America without violating this section; 
        and
          (2) the efforts made by the Voice of America to 
        recruit such individuals for employment.

          TITLE VI--ADVISORY COMMISSIONS TO FORMULATE POLICIES

          * * * * * * *

         united states advisory commission on public diplomacy

  Sec. 604. (a) Establishment.--(1) There is established an 
advisory commission to be known as the United States Advisory 
Commission on Public Diplomacy.
  (2) The Commission shall consist of seven members appointed 
by the President, by and with the advice and consent of the 
Senate. The members of the Commission shall represent the 
public interest and shall be selected from a cross section of 
educational, communications, cultural, scientific, technical, 
public service, labor, business, and professional backgrounds. 
Not more than four members shall be from any one political 
party.
  (3) The term of each member shall be 3 years, except that of 
the original seven appointments, two shall be for a term of 1 
year and two shall be for a term of 2 years.
  (4) Any member appointed to fill a vacancy occurring before 
the expiration of the term for which a predecessor was 
appointed shall be appointed for the remainder of such term. 
Upon the expiration of a member's term of office, such member 
may continue to serve until a successor is appointed and 
qualified.
  (5) The President shall designate a member to chair the 
Commission.
  (b) Staff.--The Commission shall have a staff director who 
shall be appointed by the chairperson of the Commission. 
Subject to such rules and regulations as may be adopted by the 
Commission, the chairperson of the Commission may--
          (1) appoint such additional personnel for the staff 
        of the Commission as the chairperson considers 
        necessary; and
          (2) procure temporary and intermittent services to 
        the same extent as is authorized by section 3109(b) of 
        title 5, United States Code, but at rates for 
        individuals not to exceed the daily equivalent of the 
        annual rate of basic pay payable for grade GS-18 of the 
        General Schedule under section 5332 of title 5, United 
        States Code.
  (c) Duties and Responsibilities.--(1) The Commission shall 
formulate and recommend to [the Director of the United States 
Information Agency,] the Secretary of State, and the President 
policies and programs to carry out the functions vested in the 
[Director or the Agency, and shall appraise the effectiveness 
of policies and programs of the Agency] Secretary of State or 
the Department of State, and shall appraise the effectiveness 
of the information, educational, and cultural policies and 
programs of the Department.
  (2) The Commission shall submit to the Congress, the 
President, [the Secretary of State, and the Director of the 
United States Information Agency] and the Secretary of State 
annual reports on programs and activities carried out [by the 
Agency] by the Department of State, including appraisals, where 
feasible, as to the effectiveness of the several programs. The 
Commission shall also include in such reports such 
recommendations as shall have been made by the Commission to 
the [Director for effectuating the purposes of the Agency] 
Secretary for effectuating the information, educational, and 
cultural functions of the Department, and the action taken to 
carry out such recommendations.
  (3) The Commission may also submit such other reports to the 
Congress as it considers appropriate, and shall make reports to 
the public in the United States and abroad to develop a better 
understanding of and support for the [programs conducted by the 
Agency] information, educational, and cultural programs 
conducted by the Department of State.
  (4) The Commission's reports to the Congress shall include 
assessments of the degree to which the scholarly integrity and 
nonpolitical character of the educational and cultural exchange 
activities vested in the [Director of the United States 
Information Agency] Secretary of State have been maintained, 
and assessments of the attitudes of foreign scholars and 
governments regarding such activities.
  (d) Limitation on Authority.--The Commission shall have no 
authority with respect to the J. William Fulbright Foreign 
Scholarship Board or the United States National Commission for 
UNESCO.

                       TITLE VII--APPROPRIATIONS

                    prior authorization by congress

  Sec. 701. (a) Notwithstanding any provision of law enacted 
before the date of enactment of the United States Information 
Agency Appropriation Authorization Act of 1973, no money 
appropriated to carry out this Act shall be available for 
obligation or expenditure--
          (1) unless the appropriation thereof has been 
        previously authorized by law; or
          (2) in excess of an amount previously prescribed by 
        law.
  (b) To the extent that legislation enacted after the making 
of an appropriation to carry out this Act authorizes the 
obligation or expenditure thereof, the limitation contained in 
subsection (a) shall have no effect.
  (c) The provisions of this section shall not be superseded 
except by a provision of law enacted after the date of 
enactment of the United States Information Agency Appropriation 
Authorization Act of 1973, which specifically repeals, 
modifies, or supersedes the provisions of this section.
  (d) The provisions of this section shall not apply with 
respect to appropriations made available under the joint 
resolution entitled ``Joint resolution making continuing 
appropriations for the fiscal year 1974, and for other 
purposes'', approved July 1, 1973, and any provision of law 
specifically amending such joint resolution enacted through 
October 16, 1973.
  (e) The provisions of this section shall not apply to, or 
affect in any manner, permanent appropriations, trust funds, 
and other similar accounts administered by the [United States 
Information Agency] Department of State as authorized by law.
  (f)(1) Subject to paragraphs (2) and (3), funds authorized to 
be appropriated for any account of the [United States 
Information Agency] Department of State in the Department of 
State and Related Agencies Appropriations Act, for the second 
fiscal year of any 2-year authorization cycle may be 
appropriated for such second fiscal year for any other account 
of the [United States Information Agency] Department of State.
  (2) Amounts appropriated for the ``Salaries and Expenses'' 
and ``Educational and Cultural Exchange Programs'' accounts may 
not exceed by more than 5 percent the amount specifically 
authorized to be appropriated for each such account for a 
fiscal year. No other appropriations account may exceed by more 
than 10 percent the amount specifically authorized to be 
appropriated for such account for a fiscal year.
  (3) The requirements and limitations of subsection (a) shall 
not apply to the appropriation of funds pursuant to this 
subsection.
  (4) This subsection shall cease to have effect after 
September 30, 1993.
          * * * * * * *

       nondiscretionary personnel costs and currency fluctuations

  Sec. 704. (a) Amounts appropriated for a fiscal year to carry 
out this Act are authorized to be made available until 
expended.
  (b) There are authorized to be appropriated for the [United 
States Information Agency] Department of State, in addition to 
amounts otherwise authorized to be appropriated for the 
[Agency] Department of State, such sums as may be necessary for 
any fiscal year for increases in salary, pay, retirement, and 
other employee benefits authorized by law.
  (c)(1) In order to maintain the levels of program activity 
provided for by the annual authorizing legislation for the 
[United States Information Agency] Department of State, there 
are authorized to be appropriated for the [Agency] Department 
of State such sums as may be necessary for any fiscal year to 
offset adverse fluctuations in foreign currency exchange rates, 
or overseas wage and price changes, occurring after November 30 
of the earlier of (A) the calendar year which ended during the 
fiscal year preceding such fiscal year, or (B) the calendar 
year which preceded the calendar year during which the 
authorization of appropriations for such fiscal year was 
enacted.
  (2) In carrying out this subsection, there may be established 
a Buying Power Maintenance account.
  (3) In order to eliminate substantial gains to the approved 
levels of overseas operations for the [United States 
Information Agency] Department of State, the [Director] 
Secretary of State shall transfer to the Buying Power 
Maintenance account such amounts appropriated for ``Salaries 
and Expenses'' as the [Director] Secretary of State determines 
are excessive to the needs of the approved level of operations 
under that appropriation account because of fluctuations in 
foreign currency exchange rates or changes in overseas wages 
and prices.
  (4) In order to offset adverse fluctuations in foreign 
currency exchange rates or foreign wages and prices, the 
[Director] Secretary of State may transfer from the Buying 
Power Maintenance account to the ``Salaries and Expenses'' 
appropriations account such amounts as the [Director] Secretary 
of State determines are necessary to maintain the approved 
level of operations under that appropriation account.
  (5) Funds transferred by the [Director] Secretary of State 
from the Buying Power Maintenance account to another account 
shall be merged with and be available for the same purpose, and 
for the same time period, as the funds in that other account. 
Funds transferred by the [Director] Secretary of State from 
another account to the Buying Power Maintenance account shall 
be merged with the funds in the Buying Power Maintenance 
account and shall be available for the purposes of that account 
until expended.
  (6) Any restriction contained in an appropriation Act or 
other provision of law limiting the amounts that may be 
obligated or expended by the [United States Information Agency] 
Department of State shall be deemed to be adjusted to the 
extent necessary to offset the net effect of fluctuations in 
foreign currency exchange rates or overseas wage and price 
changes in order to maintain approved levels.
  (7)(A) Subject to the limitations contained in this 
paragraph, not later than the end of the 5th fiscal year after 
the fiscal year for which funds are appropriated or otherwise 
made available for the ``Salaries and Expenses'' account, the 
[Director] Secretary of State may transfer any unobligated 
balance of such funds to the Buying Power Maintenance account.
  (B) The balance of the Buying Power Maintenance account may 
not exceed $50,000,000 as a result of any transfer under this 
paragraph.
  (C) Any transfer pursuant to this paragraph shall be treated 
as a reprogramming of funds under section 705 and shall be 
available for obligation or expenditure only in accordance with 
the procedures under such section.
  (D) The authorities contained in this section may only be 
exercised to such an extent and in such amounts as specifically 
provided in advance in appropriation Acts.
  Sec. 705. (a) Unless the Committee on Foreign Affairs of the 
House of Representatives and the Committee on Foreign Relations 
of the Senate are notified fifteen days in advance of a 
proposed reprogramming, funds appropriated for the [United 
States Information Agency] Department of State shall not be 
available for obligation or expenditure through any such 
reprogramming of funds--
          (1) which creates new programs;
          (2) which eliminates a program, project, or activity;
          (3) which increases funds or personnel by any means 
        for any project or activity for which funds have been 
        denied or restricted by the Congress;
          (4) which relocates an office or employees;
          (5) which reorganizes offices, programs, or 
        activities;
          (6) which involves contracting out functions which 
        had been performed by Federal employees; or
          (7) which involves a reprogramming in excess of 
        $500,000 or 10 percent, whichever is less, and which 
        (A) augments existing programs, projects, or 
        activities, (B) reduces by 10 percent or more the 
        funding for any existing program, project, or activity, 
        or personnel approved by the Congress, or (C) results 
        from any general savings from a reduction in personnel 
        which would result in a change in existing programs, 
        activities, or projects approved by the Congress.
  (b) In addition, the [United States Information Agency] 
Department of State may award program grants only if the 
Committee on Foreign Affairs of the House of Representatives 
and the Committee on Foreign Relations of the Senate are 
notified fifteen days in advance of the proposed grant.
  (c) Funds appropriated for the [United States Information 
Agency] Department of State may not be available for obligation 
or expenditure through any reprogramming described in 
subsection (a) during the period which is the last 15 days in 
which such funds are available unless notice of such 
reprogramming is made before such period.

                 TITLE VIII--ADMINISTRATIVE PROCEDURES

                             the secretary

  Sec. 801. In carrying out the purposes of this Act, the 
Secretary is authorized, in addition to and not in limitation 
of the authority otherwise vested in him--
          (1) In carrying out title II of this Act, to make 
        grants of money, services, or materials to State and 
        local governmental institutions in the United States, 
        to governmental institutions in other countries, and to 
        individuals and public or private nonprofit 
        organizations both in the United States and in other 
        countries;
          (2) to furnish, sell, or rent, by contract or 
        otherwise, educational and information materials and 
        equipment for dissemination to, or use by, peoples of 
        foreign countries;
          (3) whenever necessary in carrying out title V of 
        this Act, to purchase, rent, construct, improve, 
        maintain, and operate facilities for radio and 
        television transmission and reception, including the 
        leasing of associated real property (either within or 
        outside the United States) for periods not to exceed 
        forty years, or for longer periods if provided for by 
        an appropriation Act, and the alteration, improvement, 
        and repair of such property, without regard to section 
        322 of the Act of June 30, 1932 (40 U.S.C. 278a), and 
        any such real property or interests therein which are 
        outside the United States may be acquired without 
        regard to section 355 of the Revised Statutes of the 
        United States (40 U.S.C. 255) if the sufficiency of the 
        title to such real property or interests therein is 
        approved by the [Director of the United States 
        Information Agency] Secretary of State;
          (4) to provide for printing and binding outside the 
        continental limits of the United States, without regard 
        to section 11 of the Act of March 1, 1919 (44 U.S.C. 
        111);
          (5) to employ persons on a temporary basis without 
        regard to the civil service and classification laws, 
        when such employment is provided for by the pertinent 
        appropriation Act;
          (6) to create with the approval of the Commission on 
        Information and the Commission on Educational Exchange, 
        such advisory committees as the Secretary may decide to 
        be of assistance in formulating his policies for 
        carrying out the purposes of this Act. No Committee 
        member shall be allowed any salary or other 
        compensation for services; but he may be paid his 
        transportation and other expenses, as authorized by 
        section 5 of the Administrative Expenses Act of 1946, 
        as amended (5 U.S.C. 73 b-2); and
          (7) notwithstanding any other provision of law, to 
        carry out projects involving security construction and 
        related improvements for [Agency] Department of State 
        facilities not physically located together with 
        Department of State facilities abroad.

                          government agencies

  Sec. 802. (a) In carrying on activities which further the 
purposes of this Act, subject to approval of such activities by 
the Secretary, the Department and the other Government agencies 
are authorized--
          (1) to place orders and make purchases and rentals of 
        materials and equipment;
          (2) to make contracts, including contracts with 
        governmental agencies, foreign or domestic, including 
        subdivisions thereof, and intergovernmental 
        organizations of which the United States is a member, 
        and, with respect to contracts entered into in foreign 
        countries, without regard to section 3741 of the 
        Revised Statutes (41 U.S.C. 22);
          (3) under such regulations as the Secretary may 
        prescribe, to pay the transportation expenses, and not 
        to exceed $10 per diem in lieu of subsistence and other 
        expenses, of citizens or subjects of other countries, 
        without regard to the Standardized Government Travel 
        Regulations and the Subsistence Act of 1926, as 
        amended; and
          (4) to make grants for, and to pay expenses incident 
        to, training and study.
  (b)(1) Any contract authorized by subsection (a) and 
described in paragraph (3) of this subsection which is funded 
on the basis of annual appropriations may nevertheless be made 
for periods not in excess of 5 years when--
          (A) appropriations are available and adequate for 
        payment for the first fiscal year and for all potential 
        cancellation costs; and
          (B) the [Director of the United States Information 
        Agency] Secretary of State determines that--
                  (i) the need of the Government for the 
                property or service being acquired over the 
                period of the contract is reasonably firm and 
                continuing;
                  (ii) such a contract will serve the best 
                interests of the United States by encouraging 
                effective competition or promoting economies in 
                performance and operation; and
                  (iii) such method of contracting will not 
                inhibit small business participation.
  (2) In the event that funds are not made available for the 
continuation of such a contract into a subsequent fiscal year, 
the contract shall be canceled and any cancellation costs 
incurred shall be paid from appropriations originally available 
for the performance of the contract, appropriations currently 
available for the acquisition of similar property or services 
and not otherwise obligated, or appropriations made for such 
cancellation payments.
  (3) This subsection applies to contracts for the procurement 
of property or services, or both, for the operation, 
maintenance, and support of programs, facilities, and 
installations for or related to telecommunication activities, 
newswire services, and the distribution of books and other 
publications in foreign countries.
  (4)(A) Notwithstanding the other provisions of this 
subsection, the [United States Information Agency] Department 
of State is authorized to enter into contracts for periods not 
to exceed 7 years for circuit capacity to distribute radio and 
television programs.
  (B) The authority of this paragraph may be exercised for a 
fiscal year only to such extent or in such amounts as are 
provided in advance in appropriations Acts.

       maximum use of existing government property and facilities

  Sec. 803. In carrying on activities under this Act which 
require the utilization of Government property and facilities, 
maximum use shall be made of existing Government property and 
facilities.

                            basic authority

  Sec. 804. In carrying out the provisions of this Act, the 
Secretary, or any Government agency authorized to administer 
such provisions, may--
          (1) employ, without regard to the civil service and 
        classification laws, aliens within the United States 
        and abroad for service in the United States relating to 
        the translation or narration of colloquial speech in 
        foreign languages or the preparation and production of 
        foreign language programs when suitably qualified 
        United States citizens are not available when job 
        vacancies occur, and aliens so employed abroad may be 
        admitted to the United States, if otherwise qualified, 
        as nonimmigrants under section 101(a)(15) of the 
        Immigration and Nationality Act (8 U.S.C. 1101(a)(15)) 
        for such time and under such conditions and procedures 
        as may be established by the [Director of the United 
        States Information Agency] Secretary of State and the 
        Attorney General;
          * * * * * * *

   seal of the [united states information agency] department of state

  Sec. 807. The seal of the [United States Information Agency] 
Department of State shall be the arms and crest of the United 
States, encircled by the words ``[United States Information 
Agency] Department of State''. Judicial notice shall be taken 
of the seal.

                       acting associate directors

  Sec. 808. If an Associate Director of the [United States 
Information Agency] Department of State dies, resigns, or is 
sick or absent, the Associate Director's principal assistant 
shall perform the duties of the office until a successor is 
appointed or the absence or sickness stops.
          * * * * * * *

                  use of english-teaching program fees

  Sec. 810. (a) Notwithstanding section 3302 of title 31, 
United States Code, or any other law or limitation of 
authority, fees received by or for the use of the [United 
States Information Agency] Department of State from or in 
connection with English-teaching and library services, and 
[Agency] Department of State-produced publications, and not to 
exceed $100,000 of payments from motion picture and television 
programs, produced or conducted by or on behalf of the [Agency] 
Department of State under the authority of this Act or the 
Mutual Educational and Cultural Exchange Act of 1961 is 
authorized to be credited each fiscal year to the appropriate 
appropriation of the [United States Information Agency] 
Department of State to such extent as may be provided in 
advance in an appropriation Act.

                            debt collection

  Sec. 811. (a) Contract Authority.--(1) Subject to the 
availability of appropriations, the [Director of the United 
States Information Agency] Secretary of State shall enter into 
contracts for collection services to recover indebtedness owed 
by a person, other than a foreign country, to the United States 
which arises out of activities of the [United States 
Information Agency] Department of State and is delinquent by 
more than 90 days.
  (2) Each contract entered into under this section shall 
provide that the person with whom the [Director of the United 
States Information Agency] Secretary of State enters into such 
contract shall submit to the [Director] Secretary of State at 
least once every 180 days a status report on the success of the 
person in collecting debts. Section 3718 of title 31, United 
States Code, shall apply to any such contract to the extent 
that such section is not inconsistent with this subsection.
  (b) Disclosure of Delinquent Debt to Credit Reporting 
Agencies.--The [Director of the United States Information 
Agency] Secretary of State shall, to the extent otherwise 
allowed by law, disclose to those credit reporting agencies to 
which the [Director] Secretary of State reports loan activity 
information concerning any debt of more than $100 owed by a 
person, other than a foreign country, to the United States 
which arises out of activities of the [United States 
Information Agency] Department of State and is delinquent by 
more than 31 days.

        [usia] department of state posts and personnel overseas

  Sec. 812. (a) Limitation.--Except as provided under this 
section no funds authorized to be appropriated to the [United 
States Information Agency] Department of State may be used to 
pay any expense associated with the closing of any [United 
States Information Agency] Department of State post abroad.
  (b) Notification.--Not less than 45 days before the closing 
of any [United States Information Agency] Department of State 
post abroad the [Director of the United States Information 
Agency] Secretary of State shall notify the Committee on 
Foreign Affairs of the House of Representatives and the 
Committee on Foreign Relations of the Senate.
  (c) Exceptions.--This section shall not apply to any [United 
States Information Agency] Department of State post closed--
          (1) because of a break or downgrading of diplomatic 
        relations between the United States and the country in 
        which the post is located; or
          (2) where there is a real and present threat to 
        United States diplomats in the city where the post is 
        located and where a travel advisory warning against 
        travel by United States citizens to the city has been 
        issued by the Department of State.
          * * * * * * *

                         TITLE X--MISCELLANEOUS

          * * * * * * *

                     informational media guaranties

  Sec. 1011. (a) The [Director of the United States Information 
Agency] Secretary of State may make guaranties, in accordance 
with the provisions of subsection (b) of section 413 of the 
Mutual Security Act of 1954, of investments in enterprises 
producing or distributing informational media consistent with 
the national interests of the United States: Provided, That the 
purpose of making informational media guaranties shall be the 
achievement of the foreign policy objectives of the United 
States, including the objective mentioned in sections 
413(b)(4)(A) and 413(b)(4)(G) of the Mutual Security Act of 
1954, as amended.
  (b) The [Director] Secretary of State is authorized to assume 
the obligation of not to exceed $28,000,000 of the notes 
authorized to be issued pursuant to subsection 111(c)(2) of the 
Economic Cooperation Act of 1948, as amended (22 U.S.C. 
1509(c)(2)), together with the interest accrued and unpaid 
thereon, and to obtain advances from time to time from the 
Secretary of the Treasury up to such amount, less amounts 
previously advanced on such notes, as provided for in said 
notes. Such advances shall be deposited in a special account in 
the Treasury available for payments under informational media 
guaranties.
  (c) The [Director] Secretary of State is authorized to make 
informational media guaranties without regard to the 
limitations of time contained in subsection 413(b)(4) of the 
Mutual Security Act of 1954, as amended (22 U.S.C. 1933(b)(4)), 
but the total of such guaranties outstanding at any one time 
shall not exceed the sum of the face amount of the notes 
assumed by the [Director] Secretary of State less the amounts 
previously advanced on such notes by the Secretary of the 
Treasury plus the amount of the funds in the special account 
referred to in subsection (b).
  (d) Foreign currencies available after June 30, 1955, from 
conversions made pursuant to the obligation of informational 
media guaranties may be sold, in accordance with Treasury 
Department regulations, for dollars which shall be deposited in 
the special account and shall be available for payments under 
new guaranties. Such currencies shall be available, as may be 
provided for by the Congress in appropriation Acts, for use of 
educational, scientific, and cultural purposes which are in the 
national interest of the United States, and for such other 
purposes of mutual interest as may be agreed to by the 
governments of the United States and the country from which the 
currencies derive.
  (e) Notwithstanding the provisions of subparagraph 
413(b)(4)(E) of the Mutual Security Act of 1954, as amended (22 
U.S.C. 1933(b)(4)(E), (1) fees collected for the issuance of 
informational media guaranties shall be deposited in the 
special account and shall be available for payments under 
informational media guaranties; and (2) the [Director] 
Secretary of State may require the payment of a minimum charge 
of up to fifty dollars for issuance of guaranty contracts, or 
amendments thereto.
  (f) The [Director] Secretary of State is further authorized, 
under such terms as he may prescribe, to make advance payments 
under informational media guaranties: Provided, That currencies 
receivable from holders of such guaranties on account of such 
advance payments shall be paid to the United States within nine 
months from the date of the advance payment and that 
appropriate security to assure such payments is required before 
any advance payment is made.
  (g) As soon as feasible after the enactment of this 
subsection, all assets, liabilities, income, expenses, and 
charges of whatever kind pertaining to informational media 
guaranties, including any charges against the authority to 
issue notes provided in section 111(c)(2) of the Economic 
Cooperation Act of 1948, as amended, cumulative from the 
enactment of that Act, shall be accounted for separately from 
other guaranties issued pursuant to subsection 413(b) of the 
Mutual Security Act of 1954, as amended (22 U.S.C. 1933(b)): 
Provided, That there shall be transferred from the special 
account established pursuant to subsection (b), into the 
account available for payments under guaranties other than 
informational media guaranties, an amount equal to the total of 
the fees received for the issuance of guaranties other than 
informational media guaranties, and used to make payments under 
informational media guaranties.
  (h)(1) There is authorized to be appropriated annually an 
amount to restore in whole or in part any realized impairment 
to the capital used in carrying on the authority to make 
informational media guaranties, as provided in subsection (c), 
through the end of the last completed fiscal year.
  (2) Such impairment shall consist of the amount by which the 
losses incurred and interest accrued on notes exceed the 
revenue earned and any previous appropriations made for the 
restoration of impairment. Losses shall include the dollar 
losses on foreign currencies sold, and the dollar cost of 
foreign currencies which (a) the Secretary of the Treasury, 
after consultation with the [Director] Secretary of State, has 
determined to be unavailable for, in excess of, requirements of 
the United States, or (b) have been transferred to other 
accounts without reimbursement to the special account.
  (3) Dollars appropriated pursuant to this section shall be 
applied to the payment of interest and in satisfaction of notes 
issued or assumed hereunder, and to the extent of such 
application to the principal of the notes, the [Director] 
Secretary of State is authorized to issue notes to the 
Secretary of the Treasury which will bear interest at a rate to 
be determined by the Secretary of the Treasury, taking into 
consideration the current average market yields of outstanding 
marketable obligations of the United States having maturities 
comparable to the guaranties. The currencies determined to be 
unavailable for, or in excess of requirements of the United 
States as provided above shall be transferred to the Secretary 
of the Treasury to be held until disposed of, and any dollar 
proceeds realized from such disposition shall be deposited in 
miscellaneous receipts.
  (4) Section 701(a) of this Act shall not apply with respect 
to any amounts appropriated under this section for the purpose 
of liquidating the notes (and any accrued interest thereon) 
which were assumed in the operation of the informational media 
guaranty program under this section and which were outstanding 
on the date of enactment of this paragraph.
                              ----------                              


          MUTUAL EDUCATIONAL AND CULTURAL EXCHANGE ACT OF 1961

                          (FULBRIGHT-HAYS ACT)

    AN ACT To provide for the improvement and strengthening of the 
international relations of the United States by promoting better mutual 
 understanding among the peoples of the world through educational and 
                          cultural exchanges.

  Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That this 
Act may be cited as the ``Mutual Educational and Cultural 
Exchange Act of 1961.''
          * * * * * * *
  Sec. 104. (a) The President may delegate, to such officers of 
the Government as he determines to be appropriate, any of the 
powers conferred upon him by this Act to the extent that he 
finds such delegation to be in the interest of the purposes 
expressed in this Act and the efficient administration of the 
programs undertaken pursuant to this Act: Provided, That where 
the President has delegated any of such powers to any officer, 
before the President implements any proposal for the delegation 
of any of such powers to another officer, that proposal shall 
be submitted to the Speaker of the House of Representatives and 
to the Committee on Foreign Relations of the Senate, and 
thereafter a period of not less than sixty days shall have 
elapsed while Congress is in session. In computing such sixty 
days, there shall be excluded the days on which either House is 
not in session because of an adjournment of more than three 
days.
  (b) The President is authorized to employ such other 
personnel as he deems necessary to carry out the provisions and 
purposes of this Act, and of such personnel not to exceed ten 
may be compensated without regard to the provisions of the 
Classification Act of 1949, as amended, but not in excess of 
the highest rate of grade 18 of the general schedule 
established by such Act. Such positions shall be in addition to 
the number authorized by section 505 of the Classification Act 
of 1949, as amended.
  (d) For the purpose of performing functions under this Act 
outside the United States, the President is authorized to 
provide that any person employed or assigned by a United States 
Government agency shall be entitled, except to the extent that 
the President may specify otherwise in cases in which the 
period of employment or assignment exceeds thirty months, to 
the same benefits as are provided by section 310 of the Foreign 
Service Act of 1980, for individuals appointed to the Foreign 
Service.
  (e)(1) In providing for the activities and interchanges 
authorized by section 102 of this Act, grants may be made to or 
for individuals, either directly or through foundations or 
educational or other institutions, which foundations or 
institutions are public or private nonprofit, and may include 
funds for tuition and other necessary incidental expenses, for 
travel expenses from their places of residence and return for 
themselves, and, whenever it would further the purposes of this 
Act, for the dependent members of their immediate families, for 
health and accident insurance premiums, emergency medical 
expenses, costs of preparing and transporting to their former 
homes the remains of any of such persons who may die while away 
from their homes as participants or dependents of participants 
in any program under this Act, and for per diem in lieu of 
subsistence at rates prescribed by the [Director of the 
International Communication Agency] Secretary of State, for all 
such persons, and for such other expenses as are necessary for 
the successful accomplishment of the purposes of this Act.
          * * * * * * *
  Sec. 106. (a)  * * *
          * * * * * * *
  [(c)(1) There is hereby continued the Advisory Committee on 
the Arts (hereinafter referred to as the ``Committee'') created 
under section 10 of the International Cultural Exchange and 
Trade Fair Participation Act of 1956, consisting of a Chairman 
and nine other members of whom at least one shall be a member 
of the Commission. Appointment of all members and selection of 
the Chairman of this Committee shall hereafter be made by the 
Secretary of State. In making such appointments due 
consideration shall be given to the recommendations for 
nomination submitted by leading national organizations in the 
major art fields.
  [(2) The members of the Committee shall be individuals whose 
knowledge of or experience in, or whose profound interest in, 
one or more of the arts will enable them to assist the 
Commission, the President, and other officers of the Government 
in performing the functions described in paragraph (3) of this 
subsection.
  [(3) The Committee shall, in connection with activities 
authorized under subsection 102(a)(2) of this Act--
          [(A) advise and assist the Commission in the 
        discharge of its responsibilities in the field of 
        international educational exchange and cultural 
        presentations with special reference to the role of the 
        arts in such fields;
          [(B) advise other interested officers of the 
        Government in the discharge of their responsibilities 
        in connection with such activities and in connection 
        with other international activities concerned with the 
        arts;
          [(C) provide such other advice and assistance as may 
        be necessary or appropriate.
  [(4) The term of office of each of the members of the 
Committee shall be three years.]
  (d) The President is authorized to create such interagency 
and other advisory committees as in his judgment may be of 
assistance in carrying out the purposes of this Act, and from 
time to time to convene conferences of persons interested in 
educational and cultural affairs to consider matters relating 
to the purposes of this Act.
  (e) The provisions of section 214 of the Act of May 3, 1945 
(59 Stat. 134; 31 U.S.C. 691), shall be applicable to any 
interagency committee created pursuant to the provisions of 
this Act. Members of the Commission, the Committee, and other 
committees provided for in this section shall be entitled (i) 
to transportation expenses and per diem in lieu of subsistence 
at the rate prescribed by or established pursuant to section 5 
of the Administrative Expense Act of 1946, as amended (5 U.S.C. 
73b-2), while away from home in connection with attendance at 
meetings or in consultation with officials of the Government or 
otherwise carrying out duties as authorized, and (ii) if not 
otherwise in the employ of the United States Government, to 
compensation at rates not in excess of $50 per diem while 
performing services for Commission, Committee, or other 
committee. Members of the Board shall be entitled to such 
expenses and per diem in lieu of subsistence as provided for 
under clause (i) of the preceding sentence and, while 
performing services for the Board, to compensation at a rate, 
prescribed by the [Director of the International Communication 
Agency] Secretary of State, not in excess of the daily rate for 
the first step of GS-15 of the General Schedule under section 
5332 of title 5, United States Code.
  (f) The President is authorized to provide for necessary 
secretarial and staff assistance for the Board, the Commission, 
the Committee, and such other committees as may be created 
under this section.
  Sec. 107. The Board, the Commission, and the Committee shall 
submit annual reports to the Congress and such other reports to 
the Congress as they deem appropriate, and shall make reports 
to the public in the United States and abroad to develop a 
better understanding of and support for the programs authorized 
by this Act.
  Sec. 108. (a)(1) Whenever the President determines it to be 
in furtherance of this Act, the functions authorized in section 
102(a) (2) and (3) may be performed without regard to such 
provisions of law or limitations of authority regulating or 
relating to the making, performance, amendment, or modification 
of contracts, the acquisition and disposition of property, and 
the expenditure of Government funds, as he may specify.
  (2) Notwithstanding any other provision of law, the [Director 
of the International Communication Agency] Secretary of State 
may provide, on a reimbursable basis, services within the 
United States in connection with exchange activities otherwise 
authorized by this Act when such services are requested by a 
department or executive agency. Reimbursements under this 
paragraph shall be credited to the applicable appropriation of 
the Agency.
          * * * * * * *
  Sec. 112. (a) [In order to carry out the purposes of this 
Act, there is established in the United States Information 
Agency, or in such appropriate agency of the United States as 
the President shall determine, a [Bureau] Department of State 
of Educational and Cultural Affairs (hereinafter in this 
section referred to as the ``[Bureau] Department of State'').] 
The [Bureau] Department of State shall be responsible for 
managing, coordinating, and overseeing programs established 
pursuant to this Act, including but not limited to--
          (1)  * * *
          * * * * * * *
  (c) The President shall insure that all programs under the 
authority of the [Bureau] Department of State shall maintain 
their nonpolitical character and shall be balanced and 
representative of the diversity of American political, social, 
and cultural life. The President shall insure that academic and 
cultural programs under the authority of the [Bureau] 
Department of State shall maintain their scholarly integrity 
and shall meet the highest standards of academic excellence or 
artistic achievement.
  (d) The [Bureau] Department of State shall administer no 
programs except those operating under the authority of this Act 
and consistent with its purposes.
  [(e) There is established in the Bureau of Educational and 
Cultural Affairs an Office of Citizen Exchanges. The Office 
shall support private not-for-profit organizations engaged in 
the exchange of persons between the United States and other 
countries.]
  (f)(1) The President shall ensure that all exchange programs 
conducted by the United States Government, its departments and 
agencies, directly or through agreements with other parties, 
are reported at a time and in a format prescribed by the 
[Director] Secretary of State. The President shall ensure that 
such exchanges are consistent with United States foreign policy 
and avoid duplication of effort.
          * * * * * * *
                              ----------                              


    FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEARS 1994 AND 1995

          * * * * * * *

   TITLE II--UNITED STATES INFORMATIONAL, EDUCATIONAL, AND CULTURAL 
                                PROGRAMS

          * * * * * * *

                   PART C--MIKE MANSFIELD FELLOWSHIPS

SEC. 251. SHORT TITLE.

  This part may be cited as the ``Mike Mansfield Fellowship 
Act''.

SEC. 252. ESTABLISHMENT OF FELLOWSHIP PROGRAM.

  (a) Establishment.--(1) There is hereby established the 
``Mike Mansfield Fellowship Program'' pursuant to which the 
[Director of the United States Information Agency] Secretary of 
State will make grants, subject to the availability of 
appropriations, to the Mansfield Center for Pacific Affairs to 
award fellowships to eligible United States citizens for 
periods of 2 years each (or, pursuant to section 253(5)(C), for 
such shorter period of time as the Center may determine based 
on a Fellow's level of proficiency in the Japanese language or 
knowledge of the political economy of Japan) as follows:
          (A)  * * *
          * * * * * * *

        TITLE III--UNITED STATES INTERNATIONAL BROADCASTING ACT

SEC. 301. SHORT TITLE.

  This title may be cited as the ``United States International 
Broadcasting Act of 1994''.
          * * * * * * *

SEC. 304. ESTABLISHMENT OF BROADCASTING BOARD OF GOVERNORS.

  (a) Establishment.--There is hereby established within the 
[United States Information Agency] Department of State a 
Broadcasting Board of Governors (hereafter in this title 
referred to as the ``Board'').
  (b) Composition of the Board.--
          (1) The Board shall consist of 9 members, as follows:
                  (A) 8 voting members who shall be appointed 
                by the President, by and with the advice and 
                consent of the Senate.
                  (B) The [Director of the United States 
                Information Agency] Secretary of State who 
                shall also be a voting member.
          (2) The President shall designate one member (other 
        than the [Director of the United States Information 
        Agency] Secretary of State) as Chairman of the Board.
          (3) Exclusive of the [Director of the United States 
        Information Agency] Secretary of State, not more than 4 
        of the members of the Board appointed by the President 
        shall be of the same political party.
  (c) Term of Office.--The term of office of each member of the 
Board shall be three years, except that the [Director of the 
United States Information Agency] Secretary of State shall 
remain a member of the Board during the Director's term of 
service. Of the other 8 voting members, the initial terms of 
office of two members shall be one year, and the initial terms 
of office of 3 other members shall be two years, as determined 
by the President. The President shall appoint, by and with the 
advice and consent of the Senate, Board members to fill 
vacancies occurring prior to the expiration of a term, in which 
case the members so appointed shall serve for the remainder of 
such term. Any member whose term has expired may serve until a 
successor has been appointed and qualified. When there is no 
[Director of the United States Information Agency] Secretary of 
State, the acting Director of the agency shall serve as a 
member of the Board until a Director is appointed.
  (d) Selection of Board.--Members of the Board appointed by 
the President shall be citizens of the United States who are 
not regular full-time employees of the United States 
Government. Such members shall be selected by the President 
from among Americans distinguished in the fields of mass 
communications, print, broadcast media, or foreign affairs.
  (e) Compensation.--Members of the Board, while attending 
meetings of the Board or while engaged in duties relating to 
such meetings or in other activities of the Board pursuant to 
this section (including travel time) shall be entitled to 
receive compensation equal to the daily equivalent of the 
compensation prescribed for level IV of the Executive Schedule 
under section 5315 of title 5, United States Code. While away 
from their homes or regular places of business, members of the 
Board may be allowed travel expenses, including per diem in 
lieu of subsistence, as authorized by law (5 U.S.C. 5703) for 
persons in the Government service employed intermittently. The 
[Director of the United States Information Agency] Secretary of 
State shall not be entitled to any compensation under this 
title, but may be allowed travel expenses as provided under 
this subsection.
  (f) Decisions.--Decisions of the Board shall be made by 
majority vote, a quorum being present. A quorum shall consist 
of 5 members.

SEC. 305. AUTHORITIES OF THE BOARD.

  (a) Authorities.--The Board shall have the following 
authorities:
          (1) To direct and supervise all broadcasting 
        activities conducted pursuant to this [title,] title 
        (including activities of the Voice of America 
        previously carried out by the United States Information 
        Agency), the Radio Broadcasting to Cuba Act, and the 
        Television Broadcasting to Cuba Act.
          (2) To review and evaluate the mission and operation 
        of, and to assess the quality, effectiveness, and 
        professional integrity of, all such activities within 
        the context of the broad foreign policy objectives of 
        the United States.
          (3) To ensure that United States international 
        broadcasting is conducted in accordance with the 
        standards and principles contained in section 303.
          (4) To review, evaluate, and determine, at least 
        annually, the addition or deletion of language 
        services.
          (5) To make and supervise grants for broadcasting and 
        related activities in accordance with sections 308 and 
        309.
          (6) To allocate funds appropriated for international 
        broadcasting activities among the various elements of 
        the International Broadcasting [Bureau] Office and 
        grantees, subject to the limitations in sections 308 
        and 309 and subject to reprogramming notification 
        requirements in law for the reallocation of funds.
          (7) To review engineering activities to ensure that 
        all broadcasting elements receive the highest quality 
        and cost-effective delivery services.
          (8) To undertake such studies as may be necessary to 
        identify areas in which broadcasting activities under 
        its authority could be made more efficient and 
        economical.
          (9) To submit to the President and the Congress, 
        through the [Director of the United States Information 
        Agency] Secretary of State, an annual report which 
        summarizes and evaluates activities under this title, 
        the Radio Broadcasting to Cuba Act, and the Television 
        Broadcasting to Cuba Act.
          (10) To the extent considered necessary to carry out 
        the functions of the Board, procure supplies, services, 
        and other personal property.
          (11) To appoint such staff personnel for the Board as 
        the Board may determine to be necessary, subject to the 
        provisions of title 5, United States Code, governing 
        appointments in the competitive service, and to fix 
        their compensation in accordance with the provisions of 
        chapter 51 and subchapter III of chapter 53 of such 
        title relating to classification and General Schedule 
        pay rates.
          (12) To obligate and expend, for official reception 
        and representation expenses, such amount as may be made 
        available through appropriations (which for each of the 
        fiscal years 1994 and 1995 may not exceed the amount 
        made available to the Board for International 
        Broadcasting for such purposes for fiscal year 1993).
          (13) To make available in the annual report required 
        by paragraph (9) information on funds expended on 
        administrative and managerial services by the [Bureau] 
        Office and by grantees and the steps the Board has 
        taken to reduce unnecessary overhead costs for each of 
        the broadcasting services.
          (14) The Board may provide for the use of United 
        States Government transmitter capacity for relay of 
        Radio Free Asia.
  (b) Broadcasting Budgets.--
          (1) The Director of the [Bureau] Office and the 
        grantees identified in sections 308 and 309 shall 
        submit proposed budgets to the Board. The Board shall 
        forward its recommendations concerning the proposed 
        budget for the Board and broadcasting activities under 
        this title, the Radio Broadcasting to Cuba Act, and the 
        Television Broadcasting to Cuba Act to the [Director of 
        the United States Information Agency] Secretary of 
        State for the consideration of the Director as a part 
        of the [Agency's] Department's budget submission to the 
        Office of Management and Budget.
          (2) The [Director of the United States Information 
        Agency] Secretary of State shall include in the 
        Agency's submission to the Office of Management and 
        Budget the comments and recommendations of the Board 
        concerning the proposed broadcasting budget.
  (c) Implementation.--The [Director of the United States 
Information Agency] Secretary of State and the Board, in 
carrying out their functions, shall respect the professional 
independence and integrity of the International Broadcasting 
[Bureau] Office, its broadcasting services, and grantees.
  (d) Technical Amendment.--
          (1) Section 4 of the Radio Broadcasting to Cuba Act 
        (22 U.S.C. 1465b) is amended by striking ``and the 
        Associate Director for Broadcasting of the [United 
        States Information Agency] Department of State'' and 
        inserting ``of the Voice of America''.
          (2) Section 5(b) of the Radio Broadcasting to Cuba 
        Act (22 U.S.C.1465c(b)) is amended by striking 
        ``Director and Associate Director for Broadcasting of 
        the [United States Information Agency] Department of 
        State'' and inserting ``Broadcasting Board of 
        Governors''.

SEC. 306. FOREIGN POLICY GUIDANCE.

  To assist the Board in carrying out its functions, the 
Secretary of State[, acting through the Director of the United 
States Information Agency,], acting through the Under Secretary 
of State for Public Diplomacy, shall provide information and 
guidance on foreign policy issues to the Board.

SEC. 307. INTERNATIONAL BROADCASTING [BUREAU] OFFICE.

  (a) Establishment.--There is hereby established an 
International Broadcasting [Bureau] Office within the [United 
States Information Agency] Department of State (hereafter in 
this title referred to as the ``[Bureau] Office''), to carry 
out all nonmilitary international broadcasting activities 
supported by the United States Government other than those 
described in sections 308 and 309.
  (b) Selection of the Director of the [Bureau] Office.--
          (1) The Director of the [Bureau] Office shall be 
        appointed by the Chairman of the Board, in consultation 
        with the [Director of the United States Information 
        Agency] Secretary of State and with the concurrence of 
        a majority of the Board. The Director of the [Bureau] 
        Office shall be entitled to receive compensation at the 
        rate prescribed by law for level IV of the Executive 
        Schedule.
          (2) Section 5315 of title 5, United States Code, is 
        amended by adding at the end the following:
          ``Director of the International Broadcasting [Bureau] 
        Office, the [United States Information Agency] 
        Department of State.''.

SEC. 308. LIMITS ON GRANTS FOR RADIO FREE EUROPE AND RADIO LIBERTY.

  (a) Board of RFE/RL, Incorporated.--The Board may not make 
any grant to RFE/RL, Incorporated, unless the certificate of 
incorporation of RFE/RL, Incorporated, has been amended to 
provide that--
          (1) the Board of Directors of RFE/RL, Incorporated, 
        shall consist of the members of the Broadcasting Board 
        of Governors established under section 304 and of no 
        other members; and
          (2) such Board of Directors shall make all major 
        policy determinations governing the operation of RFE/
        RL, Incorporated, and shall appoint and fix the 
        compensation of such managerial officers and employees 
        of RFE/RL, Incorporated, as it considers necessary to 
        carry out the purposes of the grant provided under this 
        title.
  (b) Location of Principal Place of Business.--
          (1) The Board may not make any grant to RFE/RL, 
        Incorporated unless the headquarters of RFE/RL, 
        Incorporated and its senior administrative and 
        managerial staff are in a location which ensures 
        economy, operational effectiveness, and accountability 
        to the Board.
          (2) Not later than 90 days after confirmation of all 
        members of the Board, the Board shall provide a report 
        to Congress on the number of administrative, 
        managerial, and technical staff of RFE/RL, Incorporated 
        who will be located within the metropolitan area of 
        Washington, D.C., and the number of employees whose 
        principal place of business will be located outside the 
        metropolitan area of Washington, D.C.
  (c) Limitation on Grant Amounts.--The total amount of grants 
made by the Board for the operating costs of Radio Free Europe 
and Radio Liberty may not exceed $75,000,000 for any fiscal 
year after fiscal year 1995.
  (d) Alternative Grantee.--If the Board determines at any time 
that RFE/RL, Incorporated, is not carrying out the functions 
described in section 309 in an effective and economical manner, 
the Board may award the grant to carry out such functions to 
another entity after soliciting and considering applications 
from eligible entities in such manner and accompanied by such 
information as the Board may reasonably require.
  (e) Not a Federal Agency or Instrumentality.--Nothing in this 
title may be construed to make RFE/RL, Incorporated a Federal 
agency or instrumentality.
  (f) Authority.--Grants authorized under section 305 for RFE/
RL, Incorporated, shall be available to make annual grants for 
the purpose of carrying out similar functions as were carried 
out by RFE/RL, Incorporated, on the day before the date of 
enactment of this Act with respect to Radio Free Europe and 
Radio Liberty, consistent with section 2 of the Board for 
International Broadcasting Act of 1973, as in effect on such 
date.
  (g) Grant Agreement.--Grants to RFE/RL, Incorporated, by the 
Board shall only be made in compliance with a grant agreement. 
The grant agreement shall establish guidelines for such grants. 
The grant agreement shall include the following provisions--
          (1) that a grant be used only for activities which 
        the Board determines are consistent with the purposes 
        of subsection (f);
          (2) that RFE/RL, Incorporated, shall otherwise comply 
        with the requirements of this section;
          (3) that failure to comply with the requirements of 
        this section may result in suspension or termination of 
        a grant without further obligation by the Board or the 
        United States;
          (4) that duplication of language services and 
        technical operations between RFE/RL, Incorporated and 
        the International Broadcasting [Bureau] Office be 
        reduced to the extent appropriate, as determined by the 
        Board; and
          (5) that RFE/RL, Incorporated, justify in detail each 
        proposed expenditure of grant funds, and that such 
        funds may not be used for any other purpose unless the 
        Board gives its prior written approval.
  (h) Prohibited Uses of Grant Funds.--No grant funds provided 
under this section may be used for the following purposes:
          (1)(A) Except as provided in subparagraph (B), to pay 
        any salary or other compensation, or enter into any 
        contract providing for the payment of salary or 
        compensation in excess of the rates established for 
        comparable positions under title 5 of the United States 
        Code or the foreign relations laws of the United 
        States, except that no employee may be paid a salary or 
        other compensation in excess of the rate of pay payable 
        for level IV of the Executive Schedule under section 
        5315 of title 5, United States Code.
          (B) Salary and other compensation limitations under 
        subparagraph (A) shall not apply prior to October 1, 
        1995, with respect to any employee covered by a union 
        agreement requiring a salary or other compensation in 
        excess of such limitations.
          (2) For any activity for the purpose of influencing 
        the passage or defeat of legislation being considered 
        by Congress.
          (3) To enter into a contract or obligation to pay 
        severance payments for voluntary separation for 
        employees hired after December 1, 1990, except as may 
        be required by United States law or the laws of the 
        country where the employee is stationed.
          (4) For first class travel for any employee of RFE/
        RL, Incorporated, or the relative of any employee.
          (5) To compensate freelance contractors without the 
        approval of the Board.
  (i) Report on Management Practices.--(1) Effective not later 
than March 31 and September 30 of each calendar year, the 
Inspector General of the [United States Information Agency] 
Department of State shall submit to the Board, the [Director of 
the United States Information Agency] Secretary of State, and 
the Congress a report on management practices of RFE/RL, 
Incorporated, under this section. The Inspector General of the 
[United States Information Agency] Department of State shall 
establish a special unit within the Inspector General's office 
to monitor and audit the activities of RFE/RL, Incorporated, 
and shall provide for on-site monitoring of such activities.
  (j) Audit Authority.--
          (1) Such financial transactions of RFE/RL, 
        Incorporated, as relate to functions carried out under 
        this section may be audited by the General Accounting 
        Office in accordance with such principles and 
        procedures and under such rules and regulations as may 
        be prescribed by the Comptroller General of the United 
        States. Any such audit shall be conducted at the place 
        or places where accounts of RFE/RL, Incorporated, are 
        normally kept.
          (2) Representatives of the General Accounting Office 
        shall have access to all books, accounts, records, 
        reports, files, papers, and property belonging to or in 
        use by RFE/RL, Incorporated pertaining to such 
        financial transactions and necessary to facilitate an 
        audit. Such representatives shall be afforded full 
        facilities for verifying transactions with any assets 
        held by depositories, fiscal agents, and custodians. 
        All such books, accounts, records, reports, files, 
        papers, and property of RFE/RL, Incorporated, shall 
        remain in the possession and custody of RFE/RL, 
        Incorporated.
          (3) Notwithstanding any other provision of law and 
        upon repeal of the Board for International Broadcasting 
        Act, the Inspector General of the [United States 
        Information Agency] Department of State is authorized 
        to exercise the authorities of the Inspector General 
        Act of 1978 with respect to RFE/RL, Incorporated.
  (k) Plan for Relocation.--None of the funds authorized to be 
appropriated for the fiscal years 1994 or 1995 may be used to 
relocate the offices or operations of RFE/RL, Incorporated from 
Munich, Germany, unless--
          (1) such relocation is specifically provided for in 
        an appropriation Act or pursuant to a reprogramming 
        notification; and
          (2)(A) such relocation is authorized by the Board and 
        the Board submits to the Comptroller General of the 
        United States and the appropriate Congressional 
        committees a detailed plan for such relocation, 
        including cost estimates and any and all fiscal data, 
        audits, business plans, and other documents which 
        justify such relocation; or
          (B) prior to the confirmation of all members of the 
        Board, such relocation is authorized by the President, 
        the President certifies that a significant national 
        interest requires that such relocation determination be 
        made before the confirmation of all members of the 
        Board, and the President submits to the Comptroller 
        General of the United States and the appropriate 
        congressional committees a detailed plan for such 
        relocation, including cost estimates and any and all 
        fiscal data, audits, business plans, and other 
        documents which justify such relocation.
  (l) Reports on Personnel Classification.--Not later than 90 
days after the date of confirmation of all members of the 
Board, the Board shall submit a report to the Congress 
containing a justification, in terms of the types of duties 
performed at specific rates of salary and other compensation, 
of the classification of personnel employed by RFE/RL, 
Incorporated. The report shall include a comparison of the 
rates of salary or other compensation and classifications 
provided to employees of RFE/RL, Incorporated, with the rates 
of salary or other compensation and classifications of 
employees of the Voice of America stationed overseas in 
comparable positions and shall identify any disparities and 
steps which should be taken to eliminate such disparities.

SEC. 309. RADIO FREE ASIA.

  (a) Authority.--
          (1) Grants authorized under section 305 shall be 
        available to make annual grants for the purpose of 
        carrying out radio broadcasting to the following 
        countries: The People's Republic of China, Burma, 
        Cambodia, Laos, North Korea, Tibet, and Vietnam.
          (2) Such broadcasting service shall be referred to as 
        ``Radio Free Asia''.
  (b) Functions.--Radio Free Asia shall--
          (1) provide accurate and timely information, news, 
        and commentary about events in the respective countries 
        of Asia and elsewhere; and
          (2) be a forum for a variety of opinions and voices 
        from within Asian nations whose people do not fully 
        enjoy freedom of expression.
  (c) Submission of Detailed Plan for Radio Free Asia.--
          (1) No grant may be awarded to carry out this section 
        unless the Board, through the [Director of the United 
        States Information Agency] Secretary of State, has 
        submitted to Congress a detailed plan for the 
        establishment and operation of Radio Free Asia, 
        including--
                  (A) a description of the manner in which 
                Radio Free Asia would meet the funding 
                limitations provided in subsection (d)(4);
                  (B) a description of the numbers and 
                qualifications of employees it proposes to 
                hire; and
                  (C) how it proposes to meet the technical 
                requirements for carrying out its 
                responsibilities under this section.
          (2) The plan required by paragraph (1) shall be 
        submitted not later than 90 days after the date on 
        which all members of the Board are confirmed.
          (3) No grant may be awarded to carry out the 
        provisions of this section unless the plan submitted by 
        the Board includes a certification by the Board that 
        Radio Free Asia can be established and operated within 
        the funding limitations provided for in subsection 
        (d)(4) and subsection (d)(5).
          (4) If the Board determines that a Radio Free Asia 
        cannot be established or operated effectively within 
        the funding limitations provided for in this section, 
        the Board may submit, through the [Director of the 
        United States Information Agency] Secretary of State, 
        an alternative plan and such proposed changes in 
        legislation as may be necessary to the appropriate 
        congressional committees.
  (d) Grant Agreement.--Any grant agreement or grants under 
this section shall be subject to the following limitations and 
restrictions:
          (1)(A) The Board may not make any grant to Radio Free 
        Asia unless the headquarters of Radio Free Asia and its 
        senior administrative and managerial staff are in a 
        location which ensures economy, operational 
        effectiveness, and accountability to the Board.
          (B) Not later than 90 days after confirmation of all 
        members of the Board, the Board shall provide a report 
        to Congress on the number of administrative, 
        managerial, and technical staff of Radio Free Asia who 
        will be located within the metropolitan area of 
        Washington, DC, and the number of employees whose 
        principal place of business will be located outside the 
        metropolitan area of Washington, DC.
          (2) Any grant agreement under this section shall 
        require that any contract entered into by Radio Free 
        Asia shall specify that all obligations are assumed by 
        Radio Free Asia and not by the United States 
        Government, and shall further specify that funds to 
        carry out the activities of Radio Free Asia may not be 
        available after September 30, 1999.
          (3) Any grant agreement shall require that any lease 
        agreements entered into by Radio Free Asia shall be, to 
        the maximum extent possible, assignable to the United 
        States Government.
          (4) Grants made for the operating costs of Radio Free 
        Asia may not exceed $22,000,000 in any fiscal year.
          (5) The total amount of grant funds made available 
        for one-time capital costs of Radio Free Asia may not 
        exceed $8,000,000.
          (6) Grants awarded under this section shall be made 
        pursuant to a grant agreement which requires that grant 
        funds be used only for activities consistent with this 
        section, and that failure to comply with such 
        requirements shall permit the grant to be terminated 
        without fiscal obligation to the United States.
  (e) Limitations on Administrative and Managerial Costs.--It 
is the sense of the Congress that administrative and managerial 
costs for operation of Radio Free Asia should be kept to a 
minimum and, to the maximum extent feasible, should not exceed 
the costs that would have been incurred if Radio Free Asia had 
been operated as a Federal entity rather than as a grantee.
  (f) Assessment of the Effectiveness of Radio Free Asia.--Not 
later than 3 years after the date on which initial funding is 
provided for the purpose of operating Radio Free Asia, the 
Board shall submit to the appropriate congressional committees 
a report on--
          (1) whether Radio Free Asia is technically sound and 
        cost-effective,
          (2) whether Radio Free Asia consistently meets the 
        standards for quality and objectivity established by 
        this title,
          (3) whether Radio Free Asia is received by a 
        sufficient audience to warrant its continuation,
          (4) the extent to which such broadcasting is already 
        being received by the target audience from other 
        credible sources; and
          (5) the extent to which the interests of the United 
        States are being served by maintaining broadcasting of 
        Radio Free Asia.
  (g) Sunset Provision.--The Board may not make any grant for 
the purpose of operating Radio Free Asia after September 30, 
1998, unless the President of the United States determines in 
the President's fiscal year 1999 budget submission that 
continuation of funding for Radio Free Asia for 1 additional 
year is in the interest of the United States.
  (h) Notification and Consultation Regarding Displacement of 
Voice of America Broadcasting.--The Board shall notify the 
appropriate congressional committees before entering into any 
agreements for the utilization of Voice of America 
transmitters, equipment, or other resources that will 
significantly reduce the broadcasting activities of the Voice 
of America in Asia or any other region in order to accommodate 
the broadcasting activities of Radio Free Asia. The Chairman of 
the Board shall consult with such committees on the impact of 
any such reduction in Voice of America broadcasting activities.
  (i) Not a Federal Agency or Instrumentality.--Nothing in this 
title may be construed to make Radio Free Asia a Federal agency 
or instrumentality.

SEC. 310. TRANSITION.

  (a) Authorization.--
          (1) The President is authorized consistent with the 
        purposes of this Act to direct the transfer of all 
        functions and authorities from the Board for 
        International Broadcasting to the [United States 
        Information Agency] Department of State, the Board, or 
        the [Bureau] Office as may be necessary to implement 
        this title.
          (2)(A) Not later than 120 days after the date of 
        enactment of this Act, the [Director of the United 
        States Information Agency] Secretary of State and the 
        Chairman of the Board for International Broadcasting 
        shall jointly prepare and submit to the President for 
        approval and implementation a plan to implement the 
        provisions of this title. Such plan shall include at a 
        minimum a detailed cost analysis to implement fully the 
        recommendations of such plan. The plan shall identify 
        all costs in excess of those authorized for such 
        purposes and shall provide that any excess cost to 
        implement the plan shall be derived only from funds 
        authorized in section 201 of this Act.
          (B) The President shall transmit copies of the 
        approved plan, together with any recommendations for 
        legislative changes that may be necessary, to the 
        appropriate congressional committees.
  (b) New Appointees.--The [Director of the United States 
Information Agency] Secretary of State may assign employees of 
the Agency for service with RFE/RL, Incorporated, with the 
concurrence of the president of RFE/RL, Incorporated. Such 
assignment shall not affect the rights and benefits of such 
personnel as employees of the [United States Information 
Agency] Department of State.
  (c) Board for International Broadcasting Personnel.--All 
Board for International Broadcasting full-time United States 
Government personnel (except special Government employees) and 
part-time United States Government personnel holding permanent 
positions shall be transferred to the [United States 
Information Agency] Department of State, the Board, or the 
[Bureau] Office. Such transfer shall not cause any such 
employee to be separated or reduced in grade or compensation.
  (d) Other Authorities.--The [Director of the United States 
Information Agency] Secretary of State is authorized to utilize 
the provisions of titles VIII and IX of the United States 
Information and Educational Exchange Act of 1948, and any other 
authority available to the Director on the date of enactment of 
this Act, to the extent that the Director considers necessary 
in carrying out the provisions and purposes of this title.
  (e) Repeal.--The Board for International Broadcasting Act of 
1973 (22 U.S.C. 2871, et seq.) is repealed effective September 
30, 1995, or the date on which all members of the Board are 
confirmed, whichever is earlier.
  (f) Savings Provisions.--
          (1) Continuing effect of legal documents.--All 
        orders, determinations, rules, regulations, permits, 
        agreements, grants, contracts, certificates, licenses, 
        registrations, privileges, and other administrative 
        actions--
                  (A) which have been issued, made, granted, or 
                allowed to become effective by the President, 
                any Federal agency or official thereof, or by a 
                court of competent jurisdiction, in the 
                performance of functions which are transferred 
                under this title; and
                  (B) which are in effect at the time this 
                title takes effect, or were final before the 
                effective date of this title and are to become 
                effective on or after the effective date of 
                this title,
        shall continue in effect according to their terms until 
        modified, terminated, superseded, set aside, or revoked 
        in accordance with law by the President, the [Director 
        of the United States Information Agency] Secretary of 
        State or other authorized official, a court of 
        competent jurisdiction, or by operation of law.
          (2) Proceedings not affected.--The provisions of this 
        title shall not affect any proceedings pending before 
        the Board for International Broadcasting at the time 
        this title takes effect, with respect to functions 
        transferred by this title, but such proceedings shall 
        be continued. Orders shall be issued in such 
        proceedings, appeals shall be taken therefrom, and 
        payments shall be made pursuant to such orders, as if 
        this title had not been enacted, and orders issued in 
        any such proceedings shall continue in effect until 
        modified, terminated, superseded, or revoked by a duly 
        authorized official, by a court of competent 
        jurisdiction, or by operation of law. Nothing in this 
        subsection shall be deemed to prohibit the termination 
        or modification of any such proceeding under the same 
        terms and conditions and to the same extent that such 
        proceeding could have been terminated or modified if 
        this title had not been enacted.
          (3) Suits not affected.--The provisions of this title 
        shall not affect suits commenced before the effective 
        date of this title, and in all such suits, proceedings 
        shall be had, appeals taken, and judgments rendered in 
        the same manner and with the same effect as if this 
        title had not been enacted.
          (4) Nonabatement of actions.--No suit, action, or 
        other proceeding commenced by or against the Board for 
        International Broadcasting or by or against any 
        individual in the official capacity of such individual 
        as an officer of the Board for International 
        Broadcasting shall abate by reason of the enactment of 
        this title.
          (5) Administrative actions relating to promulgation 
        of regulations.--Any administrative action relating to 
        the preparation or promulgation of a regulation by the 
        Board for International Broadcasting relating to a 
        function transferred under this title may be continued 
        by the [United States Information Agency] Department of 
        State with the same effect as if this title had not 
        been enacted.
          (6) References.--A reference in any provision of law, 
        reorganization plan, or other authority to the 
        Associate Director for Broadcasting of the [United 
        States Information Agency] Department of State shall be 
        considered to be a reference to the Director of the 
        International Broadcasting [Bureau] Office of the 
        [United States Information Agency] Department of State.
          (7) Effect on other laws.--The provisions of, and 
        authorities contained in or transferred pursuant to, 
        this title are not intended to repeal, limit, or 
        otherwise derogate from the authorities or functions of 
        or available to the [Director of the United States 
        Information Agency] Secretary of State or the Secretary 
        of State under law, reorganization plan, or otherwise, 
        unless such provision hereof--
                  (A) specifically refers to the provision of 
                law or authority existing on the effective date 
                of this title, so affected; or
                  (B) is in direct conflict with such law or 
                authority existing on the effective date of 
                this title.

SEC. 311. PRESERVATION OF AMERICAN JOBS.

  It is the sense of the Congress that the [Director of the 
United States Information Agency] Secretary of State and the 
Chairman of the Board for International Broadcasting should, in 
developing the plan for consolidation and reorganization of 
overseas international broadcasting services, limit, to the 
maximum extent feasible, consistent with the purposes of the 
consolidation, elimination of any United States-based positions 
and should affirmatively seek to transfer as many positions as 
possible to the United States.

SEC. 312. PRIVATIZATION OF RADIO FREE EUROPE AND RADIO LIBERTY.

  (a) Declaration of Policy.--It is the sense of the Congress 
that, in furtherance of the objectives of section 302 of this 
Act, the funding of Radio Free Europe and Radio Liberty should 
be assumed by the private sector not later than December 31, 
1999, and that the funding of Radio Free Europe and Radio 
Liberty Research Institute should be assumed by the private 
sector at the earliest possible time.
  (b) Presidential Submission.--The President shall submit with 
his annual budget submission as provided for in section 307 an 
analysis and recommendations for achieving the objectives of 
subsection (a).
  (c) Reports on Transfer of RFE/RL Research Institute.--Not 
later than 120 days after the date of enactment of this Act, 
the Board for International Broadcasting, or the Board, if 
established, shall submit to the appropriate congressional 
committees a report on the steps being taken to transfer RFE/RL 
Research Institute pursuant to subsection (a) and shall provide 
periodic progress reports on such efforts until such transfer 
has been achieved.
          * * * * * * *
                              ----------                              


                  TELEVISION BROADCASTING TO CUBA ACT

SEC. 243. TELEVISION BROADCASTING TO CUBA.

  (a) Television Broadcasting to Cuba.--In order to carry out 
the purposes set forth in section 242 and notwithstanding the 
limitation of section 501 of the United States Information and 
Educational Exchange Act of 1948 (22 U.S.C. 1461) with respect 
to the dissemination in the United States of information 
prepared for dissemination abroad to the extent such 
dissemination is inadvertent, the [United States Information 
Agency (hereafter in this part referred to as the ``Agency'')] 
Department of State (hereafter in this part referred to as the 
``Department'') shall provide for the open communication of 
information and ideas through the use of television 
broadcasting to Cuba. Television broadcasting to Cuba shall 
serve as a consistently reliable and authoritative source of 
accurate, objective, and comprehensive news.
          * * * * * * *

SEC. 244. TELEVISION MARTI SERVICE OF THE UNITED STATES INFORMATION 
                    AGENCY.

  (a) Television Marti Service.--[The Director of the United 
States Information Agency shall establish within the Voice of 
America a Television Marti Service.] The Secretary of State 
shall administer within the Voice of America the Television 
Marti Service. The Service shall be responsible for all 
television broadcasts to Cuba authorized by this part. The 
[Director of the United States Information Agency] Secretary of 
State shall appoint a head of the Service who shall report 
directly to the Director of the Voice of America. The head of 
the Service shall employ such staff as the head of the Service 
may need to carry out the duties of the Service.
  (b) Use of Existing Facilities of the [USIA] Department of 
State.--To assure consistency of presentation and efficiency of 
operations in conducting the activities authorized under this 
part, the Television Marti Service shall make maximum feasible 
utilization of [Agency facilities] Department facilities and 
management support, including Voice of America: Cuba Service, 
Voice of America, and the [United States Information Agency 
Television Service] Department of State Television Service.
  (c) [USIA Authority.--The Agency] Secretary of State 
Authority.--The Secretary of State may carry out the purposes 
of this part by means of grants, leases, or contracts (subject 
to the availability of appropriations), or such other means as 
the [Agency] Secretary of State determines will be most 
effective.
          * * * * * * *

SEC. 246. ASSISTANCE FROM OTHER GOVERNMENT AGENCIES.

  In order to assist the [United States Information Agency] 
Department of State in carrying out the provisions of this 
part, any agency or instrumentality of the United States may 
sell, loan, lease, or grant property (including interests 
therein) and may perform administrative and technical support 
and services at the request of [the Agency] the Department.

SEC. 247. AUTHORIZATION OF APPROPRIATIONS.

  [(a) Authorization of Appropriations.--In addition to amounts 
otherwise made available under section 201 for such purposes, 
there are authorized to be appropriated to the United States 
Information Agency, $16,000,000 for the fiscal year 1990 and 
$16,000,000 for the fiscal year 1991 for television 
broadcasting to Cuba in accordance with the provisions of this 
part.]
          * * * * * * *
                              ----------                              


                     RADIO BROADCASTING TO CUBA ACT

          * * * * * * *

    additional functions of the [united states information agency] 
                          Department of state

    Sec. 3. (a) In order to carry out the objectives set forth 
in section 2, the [United States Information Agency (hereafter 
in this Act referred to as the ``Agency'')] Department of State 
(hereafter in this Act referred to as the ``Department'') shall 
provide for the open communication of information and ideas 
through the use of radio broadcasting to Cuba. Radio 
broadcasting to Cuba shall serve as a consistently reliable and 
authoritative source of accurate, objective, and comprehensive 
news.
          * * * * * * *
    (f) In the event broadcasting facilities located at 
Marathon, Florida, are rendered inoperable by natural disaster 
or by unlawful destruction, the [Director of the United States 
Information Agency] Secretary of State may, for the period in 
which the facilities are inoperable but not to exceed one 
hundred and fifty days, use other United States Government-
owned transmission facilities for Voice of America broadcasts 
to Cuba authorized by this Act.

                  cuba service of the voice of america

    Sec. 4. [The Director of the United States Information 
Agency shall establish within the Voice of America a Cuba 
Service (hereafter in this section referred to as the 
``Service'').] The Secretary of State shall administer within 
the Voice of America the Cuba Service (hereafter in this 
section referred to as the ``Service''). The Service shall be 
responsible for all radio broadcasts to Cuba authorized by 
section 3. The [Director of the United States Information 
Agency] Secretary of State shall appoint a head of the Service 
and shall employ such staff as the head of the Service may need 
to carry out his duties. The Cuba Service shall be administered 
separately from other Voice of America functions and the head 
of the Cuba Service shall report directly to the Director of 
the Voice of America.
          * * * * * * *

               assistance from other government agencies

    Sec. 6. (a) In order to assist the [United States 
Information Agency] Department of State in carrying out the 
purposes set forth in section 2, any agency or instrumentality 
of the United States may sell, loan, lease, or grant property 
(including interests therein) and may perform administrative 
and technical support and services at the request of [the 
Agency] the Department. Support and services shall be provided 
on a reimbursable basis. Any reimbursement shall be credited to 
the appropriation from which the property, support, or services 
was derived.
    (b) [The Agency] The Department may carry out the purposes 
of section 3 by means of grants, leases, or contracts (subject 
to the availability of appropriations), or such other means as 
[the Agency] the Secretary of State determines will be most 
effective.

                         facility compensation

    Sec. 7. (a) * * *
    (b) Accordingly, the [Agency] Department may make payments 
to the United States radio broadcasting station licensees upon 
their application for expenses which they have incurred before, 
on or after the date of this Act in mitigating, pursuant to 
special temporary authority from the Federal Communications 
Commission, the effects of activities by the Government of Cuba 
which directly interfere with the transmission or reception of 
broadcasts by these licensees. Such expenses shall be limited 
to the casts of equipment replaced (less depreciation) and 
associated technical and engineering costs.
          * * * * * * *
    (d) There are authorized to be appropriated to the [Agency] 
Department $5,000,000 for use in compensating United States 
radio broadcasting licensees pursuant to this section. Amounts 
appropriated under this section are authorized to be available 
until expended.
          * * * * * * *

                    authorization of appropriations

    Sec. 8. (a) There are authorized to be appropriated for the 
United States Information Agency $14,000,000 for fiscal year 
1984, and $11,000,000 for fiscal year 1985 to carry out 
sections 3 and 4 of this Act. The amount obligated by the 
[United States Information Agency] Department of State in 
ensuing fiscal years shall be sufficient to maintain broadcasts 
to Cuba under this Act at rates no less than the fiscal year 
1985 level.
          * * * * * * *
                              ----------                              


  NATIONAL ENDOWMENT FOR DEMOCRACY ACT (TITLE V OF PUBLIC LAW 98-164)

               TITLE V--NATIONAL ENDOWMENT FOR DEMOCRACY

                              short title

    Sec. 501. This title may be cited as the ``National 
Endowment for Democracy Act''.
          * * * * * * *

                        grants to the endowment

    Sec. 503. (a) The [Director of the United States 
Information Agency] Secretary of State shall make an annual 
grant to the Endowment to enable the Endowment to carry out its 
purposes as specified in section 502(b). Such grants shall be 
made with funds specifically appropriated for grants to the 
Endowment or with funds appropriated to [the Agency] the 
Department of State for the ``Salaries and Expenses'' account. 
Such grants shall be made pursuant to a grant agreement between 
the [Director] Secretary of State and the Endowment which 
requires that grant funds will only be used for activities 
which the Board of Directors of the Endowment determines are 
consistent with the purposes described in section 502(b), that 
the Endowment will allocate funds in accordance with subsection 
(e) of this section, and that the Endowment will otherwise 
comply with the requirements of this title. The grant agreement 
may not require the Endowment to comply with requirements other 
than those specified in this title.
    (b) Funds so granted may be used by the Endowment to carry 
out the purposes described in section 502(b), and otherwise 
applicable limitations on the purposes for which funds 
appropriated to the [United States Information Agency] 
Department of State may be used shall not apply to funds 
granted to the Endowment.
          * * * * * * *

                eligibility of the endowment for grants

    Sec. 504. (a) * * *
          * * * * * * *
    (g) The financial transactions of the Endowment for each 
fiscal year shall be audited by the [United States Information 
Agency] Department of State under the conditions set forth in 
subsection (f)(1).
          * * * * * * *

                         freedom of information

    Sec. 506. (a) * * *
    (b) Publication in Federal Register.--For purposes of 
complying pursuant to subsection (a) with section 552(a)(1) of 
such title, the Endowment shall make available to the [Director 
of the United States Information Agency] Secretary of State 
such records and other information as the [Director] Secretary 
determines may be necessary for such purposes. The [Director] 
Secretary shall cause such records and other information to be 
published in the Federal Register.
    (c) Review by [USIA] Department of State.--(1) In the event 
that the Endowment determines not to comply with a request for 
records under section 552, the Endowment shall submit a report 
to the [Director of the United States Information Agency] 
Secretary of State explaining the reasons for not complying 
with such request.
    (2) If the [Director] Secretary approves the determination 
not to comply with such request, the [United States Information 
Agency] Department of State shall assume full responsibility, 
including financial responsibility, for defending the Endowment 
in any litigation relating to such request.
    (3) If the [Director] Secretary disapproves the 
determination not to comply with such request, the Endowment 
shall comply with such request.
                              ----------                              


    FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEARS 1986 AND 1987

          * * * * * * *

               TITLE II--UNITED STATES INFORMATION AGENCY

          * * * * * * *

SEC. 208. BAN ON DOMESTIC ACTIVITIES BY THE USIA.

    Except as provided in section 501 of the United States 
Information and Education Exchange Act of 1948 (22 U.S.C. 1461) 
and this section, no funds authorized to be appropriated to the 
[United States Information Agency] Department of State shall be 
used to influence public opinion in the United States, and no 
program material prepared by the [United States Information 
Agency] Department of State in carrying out its international 
information, educational, and cultural activies shall be 
distributed within the United States. This section shall not 
apply to programs carried out pursuant to the Mutual 
Educational and Cultural Exchange Act of 1961 (22 U.S.C. 2451 
et seq.). The provisions of this section shall not prohibit the 
United States Information Agency from responding to inquiries 
from members of the public about its operations, policies, or 
programs.
          * * * * * * *

  TITLE VI--UNITED STATES SCHOLARSHIP PROGRAM FOR DEVELOPING COUNTRIES

          * * * * * * *

SEC. 603. SCHOLARSHIP PROGRAM AUTHORITY.

    (a) In General.--The President acting through the [United 
States Information Agency], Department of State shall provide 
scholarships (including partial assistance) for undergraduate 
study at United States institutions of higher education by 
citizens and nationals of developing countries who have 
completed their secondary education and who would not otherwise 
have an opportunity to study in the United States due to 
financial limitations.
          * * * * * * *

SEC. 604. GUIDELINES.

    The scholarship program under this title shall be carried 
out in accordance with the following guidelines:
          (1) * * *
          * * * * * * *
          (11) The [United States Information Agency] 
        Department of State shall recommend to each student, 
        who receives a scholarship under this title for study 
        at a college or university, that the student enroll in 
        a course on the classics of American political thought 
        or which otherwise emphasizes the ideas, principles, 
        and documents upon which the United States was founded.
          * * * * * * *

SEC. 606. POLICY REGARDING OTHER INTERNATIONAL EDUCATIONAL PROGRAMS.

    (a) * * *
    (b) [USIA] State Department Funded Postgraduate Study in 
the United States.--The Congress urges the [Director of the 
United States Information Agency] Secretary of State to expand 
opportunities for students of limited postgraduate study at 
United States institutions of higher education.
          * * * * * * *

SEC. 609. GENERAL AUTHORITIES.

    (a) * * *
          * * * * * * *
    (e) Other Activities to Promote Improved Understanding.--
Funds allocated by the [United States Information Agency] 
Department of State, or the agency primarily responsible for 
carrying out part I of the Foreign Assistance Act of 1961, for 
scholarships in accordance with this title shall be available 
to enhance the educational training and capabilities of the 
people of Latin America and the Caribbean and to promote better 
understanding between the United States and Latin America and 
the Caribbean through programs of cooperation, study, training, 
and research. Such funds may be used for program and 
administrative costs for institutions carrying out such 
programs.
          * * * * * * *
                              ----------                              


               SECTION 1003 OF THE FASCELL FELLOWSHIP ACT

SEC. 1003. FELLOWSHIP BOARD.

    (a) Establishment and Function.--There is hereby 
established a Fellowship Board (hereafter in this title 
referred to as the ``Board''), which shall select the 
individuals who will be eligible to serve as Fellows.
    (b) Membership.--The Board shall consist of [9] 8 members 
as follows:
          (1) A senior official of the Department of State (who 
        shall be the chair of the Board), designated by the 
        Secretary of State.
          (2) An officer or employee of the Department of 
        Commerce, designated by the Secretary of Commerce.
          [(3) An officer or employee of the United States 
        Information Agency, designated by the Director of that 
        Agency.
          [(4)] (3) Six academic specialists in international 
        affairs or foreign languages, appointed by the 
        Secretary of State (in consultation with the chairman 
        and ranking minority member of the Committee on Foreign 
        Affairs of the House of Representatives and the 
        chairman and ranking minority member of the Committee 
        on Foreign Relations of the Senate).
          * * * * * * *
                              ----------                              


  SECTION 803 OF THE INTELLIGENCE AUTHORIZATION ACT, FISCAL YEAR 1992

SEC. 803. NATIONAL SECURITY EDUCATION BOARD.

  (a) Establishment.--The Secretary of Defense shall establish 
a National Security Education Board.
  (b) Composition.--The Board shall be composed of the 
following individuals or the representatives of such 
individuals:
          (1) The Secretary of Defense, who shall serve as the 
        chairman of the Board.
          (2) The Secretary of Education.
          (3) The Secretary of State.
          (4) The Secretary of Commerce.
          (5) The Director of Central Intelligence.
          [(6) The Director of the United States Information 
        Agency.]
          [(7)] (6) The Chairperson of the National Endowment 
        for the Humanities.
          [(8)] (7) Six individuals appointed by the President, 
        by and with the advice and consent of the Senate, who 
        shall be experts in the fields of international, 
        language, and area studies education and who may not be 
        officers or employees of the Federal Government.
  (c) Term of Appointees.--Each individual appointed to the 
Board pursuant to [subsection (b)(7)] subsection (b)(6) shall 
be appointed for a period specified by the President at the 
time of the appointment, but not to exceed four years. Such 
individuals shall receive no compensation for service on the 
Board but may receive reimbursement for travel and other 
necessary expenses.
          * * * * * * *
                              ----------                              


    FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEARS 1992 AND 1993

          * * * * * * *

   TITLE II--UNITED STATES INFORMATIONAL, EDUCATIONAL, AND CULTURAL 
                                PROGRAMS

                PART A--UNITED STATES INFORMATION AGENCY

          * * * * * * *

SEC. 208. CENTER FOR CULTURAL AND TECHNICAL INTERCHANGE BETWEEN NORTH 
                    AND SOUTH.

  (a) Short Title.--This section may be cited as the ``North/
South Center Act of 1991''.
  (b) Purpose.--The purpose of this section is to promote 
better relations between the United States and the nations of 
Latin America and the Caribbean and Canada through cooperative 
study, training, and research, by supporting in Florida a 
Center for Cultural and Technical Interchange Between North and 
South where scholars and students in various fields from the 
nations of the hemisphere may study, give and receive training, 
exchange ideas and views, and conduct other activities 
consistent with the objectives of the Mutual Educational and 
Cultural Exchange Act of 1961 and other Acts promoting 
international, educational, cultural, scientific, and related 
activities of the United States.
  (c) North/South Center.--In order to carry out the purpose of 
this section, the [Director of the United States Information 
Agency] Secretary of State shall provide for the operation in 
Florida of an educational institution known as the North/South 
Center, through arrangements with public, educational, or other 
nonprofit institutions.
  (d) Authorities.--The [Director of the United States 
Information Agency] Secretary of State, in carrying out this 
section, may utilize the authorities of the Mutual Educational 
and Cultural Exchange Act of 1961. Section 704(b) of the Mutual 
Security Act of 1960 (22 U.S.C. 2056(b)) shall apply in the 
administration of this section. In order to carry out the 
purposes of this section, the North/South Center is authorized 
to use funds made available under this section to acquire 
property and facilities, by construction, lease, or purchase.
  (e) Authorization of Appropriations.--There are authorized to 
be appropriated $5,000,000 for fiscal year 1992 and $10,000,000 
for each subsequent fiscal year to carry out this section. 
Amounts appropriated under this section are authorized to be 
available until expended.
  (f) Repeal.--Effective October 1, 1991, the section enacted 
by the third proviso under the heading ``education and human 
resources development, development assistance'' in the Foreign 
Operations, Export Financing, and Related Programs 
Appropriations Act, 1991, is repealed.
          * * * * * * *

SEC. 212. USIA GRANTS.

  (a) Competitive Grant Procedures.--Except as provided in 
subsection (b), the [United States Information Agency] 
Department of State, in carrying out its international 
information, educational, and cultural functions, shall work to 
achieve full and open competition in the award of grants.
  (b) Exceptions.--The [United States Information Agency] 
Department of State may award a grant under procedures other 
than competitive procedures when--
          (1)  * * *
          * * * * * * *
  (c) Compliance With Grant Guidelines.--
          (1) After October 1, 1991, grants awarded by the 
        [United States Information Agency shall substantially 
        comply with United States Information Agency] 
        Department of State, in carrying out its international 
        information, educational, and cultural functions, shall 
        substantially comply with Department of State grant 
        guidelines and applicable circulars of the Office of 
        Management and Budget.
          (2) If the [Agency] Department determines that a 
        grantee has not satisfied the requirement of paragraph 
        (1), the [United States Information Agency] Department 
        of State shall notify the grantee of the suspension of 
        payments under a grant unless compliance is achieved 
        within 90 days of such notice.
          (3) The [Agency] Department shall suspend payments 
        under any grant which remains in noncompliance 90 days 
        after notification under paragraph (2).
  [(d) Report to Congress.--Not later than 90 days after the 
date of the enactment of this Act, the Director of the United 
States Information Agency shall submit a detailed report to the 
Committee on Foreign Relations of the Senate and the Committee 
on Foreign Affairs of the House of Representatives on United 
States Information Agency action to comply with subsection 
(a).]
          * * * * * * *

           PART B--BUREAU OF EDUCATIONAL AND CULTURAL AFFAIRS

          * * * * * * *

SEC. 227. LAW AND BUSINESS TRAINING PROGRAM FOR GRADUATE STUDENTS FROM 
                    THE SOVIET UNION, LITHUANIA, LATVIA, AND ESTONIA.

  (a) Statement of Purpose.--The purpose of this section is to 
establish a scholarship program designed to bring students from 
the Soviet Union, Lithuania, Latvia, and Estonia to the United 
States for study in the United States.
  (b) Scholarship Program Authority.--Subject to the 
availability of appropriations under subsection (d), the 
President, acting through the [United States Information 
Agency] Department of State, shall provide scholarships 
(including partial assistance) for study at United States 
institutions of higher education together with private and 
public sector internships by nationals of the Soviet Union, 
Lithuania, Latvia, and Estonia who have completed their 
undergraduate education and would not otherwise have the 
opportunity to study in the United States due to financial 
limitations.
  (c) Guidelines.--The scholarship program under this section 
shall be carried out in accordance with the following 
guidelines:
          (1) Consistent with section 112(b) of the Mutual 
        Educational and Cultural Exchange Act of 1961 (22 
        U.S.C. 2460(b)), all programs created pursuant to this 
        Act shall be nonpolitical and balanced, and shall be 
        administered in keeping with the highest standards of 
        academic integrity and cost-effectiveness.
          (2) The [United States Information Agency] Department 
        of State shall design ways to identify promising 
        students for study in the United States.
          (3) The [United States Information Agency] Department 
        of State should develop and strictly implement specific 
        financial need criteria. Scholarships under this Act 
        may only be provided to students who meet the financial 
        need criteria.
          (4) The program may utilize educational institutions 
        in the United States, if necessary, to help 
        participants acquire necessary skills to fully 
        participate in professional training.
          (5) Each participant shall be selected on the basis 
        of academic and leadership potential in the fields of 
        business administration, economics, law, or public 
        administration. Scholarship opportunities shall be 
        limited to fields that are critical to economic reform 
        and political development in the Soviet Union, 
        Lithuania, Latvia, and Estonia, particularly business 
        administration, economics, law, or public 
        administration.
          (6) The program shall be flexible to include not only 
        training and educational opportunities offered by 
        universities in the United States, but to also support 
        internships, education, and training in a professional 
        setting.
          (7) The program shall be flexible with respect to the 
        number of years of education financed, but in no case 
        shall students be brought to the United States for less 
        than one year.
          (8) Further allowance shall be made in the 
        scholarship for the purchase of books and related 
        educational material relevant to the program of study.
          (9) Further allowance shall be made to provide 
        opportunities for professional, academic, and cultural 
        enrichment for scholarship recipients.
          (10) The program shall, to the maximum extent 
        practicable, offer equal opportunities for both male 
        and female students to study in the United States.
          (11) The program shall, to the maximum extent 
        practicable, offer equal opportunities for students 
        from each of the Soviet republics, Lithuania, Latvia, 
        and Estonia.
          (12) The [United States Information Agency] 
        Department of State shall recommend to each student who 
        receives a scholarship under this section that the 
        student include in their course of study programs which 
        emphasize the ideas, principles, and documents upon 
        which the United States was founded.
  [(d) Funding of Scholarships for Fiscal Year 1992 and Fiscal 
Year 1993.--There are authorized to be appropriated to the 
United States Information Agency $7,000,000 for fiscal year 
1992, and $7,000,000 for fiscal year 1993, to carry out this 
section.]
          * * * * * * *
                              ----------                              


                      MUTUAL SECURITY ACT OF 1960

          * * * * * * *

CHAPTER VII--CENTER FOR CULTURAL AND TECHNICAL INTERCHANGE BETWEEN EAST 
                                AND WEST

          * * * * * * *
    Sec. 703. In order to carry out the purpose of this chapter 
the [Director of the United States Information Agency 
(hereinafter referred to as the ``Director'')] Secretary of 
State (hereinafter referred to as the ``Secretary'') shall 
provide for--
          (1) the [establishment and] operation in Hawaii of an 
        educational institution to be known as the Center for 
        Cultural and Technical Interchange Between East and 
        West, through arrangements with public, educational, or 
        other nonprofit institutions;
          * * * * * * *
    Sec. 704. (a) In carrying out the provisions of this 
chapter, the Secretary may utilize his authority under the 
provisions of the United States Information and Educational 
Exchange Act of 1948, as amended.
    (b) The Secretary may, in administering the provisions of 
this chapter, accept from public and private sources money and 
property to be utilized in carrying out the purposes and 
functions of the Center. In utilizing any gifts, bequests, or 
devises accepted there shall be available to the Secretary the 
same authorities as are available to him in accepting and 
utilizing gifts, bequests, and devises to the Foreign Service 
Institute under the provisions of the section 25 of the State 
Department Basic Authorities Act of 1956. For the purposes of 
Federal income, estate, and gift taxes, any gift, devise, or 
bequest accepted by the Secretary under the authority of this 
chapter shall be deemed to be a gift, devise, or bequest to or 
for the use of the United States.
    (c) The [Director] Secretary of the International 
Communication Agency shall make periodic reports, as he deems 
necessary, to the Congress with respect to his activities under 
the provisions of this chapter, and such reports shall include 
any recommendations for needed revisions in this chapter.
          * * * * * * *
                              ----------                              


  SECTION 202 OF THE FOREIGN RELATIONS AUTHORIZATION ACT, FISCAL YEAR 
                                  1979

           mission of the international communication agency

    Sec. 202. The [mission of the International Communication 
Agency] mission of the Department of State in carrying out its 
information, educational, and cultural functions shall be to 
further the national interest by improving United States 
relations with other countries and peoples through the broadest 
possible sharing of ideas, information, and educational and 
cultural activities. In carrying out this mission, the 
[International Communication Agency] Department of State shall, 
among other activities--
          (1) conduct Government-sponsored information, 
        educational, and cultural activities designed--
                  (A) to provide other peoples with a better 
                understanding of the policies, values, 
                institutions, and culture of the United States; 
                and
                  (B) within the statutory limits governing 
                domestic activities of the [Agency] Department, 
                to enhance understanding on the part of the 
                Government and people of the United States of 
                the history, culture, attitudes, perceptions, 
                and aspirations of others;
          (2) encourage private institutions in the United 
        States to develop their own exchange activities, and 
        provide assistance for those exchange activities which 
        are in the broadest national interest;
          (3) coordinate international informational, 
        educational, or cultural activities conducted or 
        planned by departments and agencies of the United 
        States Government;
          (4) assist in the development of a comprehensive 
        national policy on international communications; and
          (5) promote United States participation in 
        international events relevant to the [mission of the 
        Agency] mission described in this section.
                              ----------                              


SECTION 2 OF THE SUPPORT FOR EAST EUROPEAN DEMOCRACY (SEED) ACT OF 1989

SEC. 2. SUPPORT FOR EAST EUROPEAN DEMOCRACY (SEED) PROGRAM.

  (a)  * * *
          * * * * * * *
  (c) SEED Actions.--Assistance and other activities under the 
SEED Program (which may be referred to as ``SEED Actions'') 
shall include activities such as the following:
          (1)  * * *
          * * * * * * *
          (17) Exchange activities.--Expanded exchange 
        activities under the Fulbright, International Visitors, 
        and other programs conducted by the [United States 
        Information Agency] Department of State.
          * * * * * * *
                              ----------                              


           SECTION 7 OF THE FEDERAL TRIANGLE DEVELOPMENT ACT

SEC. 7. INTERNATIONAL CULTURAL AND TRADE CENTER COMMISSION.

  (a)  * * *
          * * * * * * *
  (c) Membership.--
          (1) Number and appointment.--The Commission shall be 
        composed of [15] 14 members as follows:
                  (A) The Secretary of State or his delegate.
                  (B) The Secretary of Commerce or his 
                delegate.
                  (C) The Secretary of Agriculture or his 
                delegate.
                  (D) The United States Trade Representative or 
                his delegate.
                  (E) The Administrator or his delegate.
                  [(F) The Director of the United States 
                Information Agency or his delegate.]
                  [(G)] (F) The Chairman of the Corporation or 
                his delegate.
                  [(H)] (G) The Mayor of the District of 
                Columbia or his delegate.
                  [(I)] (H) The Chairman of the National 
                Endowment for the Arts or his delegate.
                  [(J)] (I) 6 individuals appointed by the 
                President one of whom shall be a resident and 
                registered voter of the District of Columbia 
                and all of whom shall be specially qualified to 
                serve on the Commission by virtue of their 
                education, training, or experience in 
                international trade, commerce, cultural 
                exchange, finance, business, or management of 
                facilities similar to the international 
                cultural and trade center described in section 
                8.
        A vacancy in the Commission shall be filled in the 
        manner in which the original appointment was made.
          * * * * * * *
                              ----------                              


                      FOREIGN SERVICE ACT OF 1980

          * * * * * * *

           TITLE I--THE FOREIGN SERVICE OF THE UNITED STATES

                     Chapter 1--General Provisions

          * * * * * * *

                  Chapter 2--Management of the Service

          * * * * * * *
  Sec. 202. Other Agencies Utilizing the Foreign Service 
Personnel System.--(a)[(1) The Director of the United States 
Information Agency and the Director of the United States 
International Development Cooperation Agency may utilize the 
Foreign Service personnel system with respect to their 
respective agencies in accordance with this Act.]
          * * * * * * *
  Sec. 210. Board of the Foreign Service.--The President shall 
establish a Board of the Foreign Service to advise the 
Secretary of State on matters relating to the Service, 
including furtherance of the objectives of maximum 
compatibility among agencies authorized by law to utilize the 
Foreign Service personnel system and compatibility between the 
Foreign Service personnel system and the other personnel 
systems of the Government. The Board of the Foreign Service 
shall be chaired by an individual appointed by the President 
and shall include one or more representatives of the Department 
of State, [the United States Information Agency, the United 
States International Development Cooperation Agency,] the 
Department of Agriculture, the Department of Commerce, the 
Department of Labor, the Office of Personnel Management, the 
Office of Management and Budget, the Equal Employment 
Opportunity Commission, and such other agencies as the 
President may designate.
          * * * * * * *

              Chapter 9--Travel, Leave, and Other Benefits

          * * * * * * *
  Sec. 904. Health Care.--(a) The Secretary of State shall 
establish a health care program to promote and maintain the 
physical and mental health of members of the Service, and (when 
incident to service abroad) other designated eligible 
Government employees, [and] members of the families of such 
members and employees, and for care provided abroad) such other 
persons as are designated by the Secretary of State, except 
that such persons shall be considered persons other than 
covered beneficiaries for purposes of subsections (g) and (h).
          * * * * * * *
  (g)(1) In the case of a person who is a covered beneficiary, 
the Secretary of State is authorized to collect from a third-
party payer the reasonable costs incurred by the Department of 
State on behalf of such person for health care services to the 
same extent that the covered beneficiary would be eligible to 
receive reimbursement or indemnification from the third-party 
payer for such costs.
  (2) If the insurance policy, plan, contract, or similar 
agreement of that third-party payer includes a requirement for 
a deductible or copayment by the beneficiary of the plan, then 
the Secretary of State may collect from the third-party payer 
only the reasonable costs of the care provided less the 
deductible or copayment amount.
  (3) A covered beneficiary shall not be required to pay any 
deductible or copayment for health care services under this 
subsection.
  (4) No provision of any insurance, medical service, or health 
plan contract or agreement having the effect of excluding from 
coverage or limiting payment of charges for care in the 
following circumstances shall operate to prevent collection by 
the Secretary of State under paragraph (1)--
          (A) care provided directly or indirectly by a 
        governmental entity;
          (B) care provided to an individual who has not paid a 
        required deductible or copayment; or
          (C) care provided by a provider with which the third-
        party payer has no participation agreement.
  (5) No law of any State, or of any political subdivision of a 
State, and no provision of any contract or agreement shall 
operate to prevent or hinder recovery or collection by the 
United States under this section.
  (6) As to the authority provided in paragraph (1) of this 
subsection--
          (A) the United States shall be subrogated to any 
        right or claim that the covered beneficiary may have 
        against a third-party payer;
          (B) the United States may institute and prosecute 
        legal proceedings against a third-party payer to 
        enforce a right of the United States under this 
        subsection; and
          (C) the Secretary may compromise, settle, or waive a 
        claim of the United States under this subsection.
  (7) The Secretary shall prescribe regulations for the 
administration of this subsection and subsection (h). Such 
regulations shall provide for computation of the reasonable 
cost of health care services.
  (8) Regulations prescribed under this subsection shall 
provide that medical records of a covered beneficiary receiving 
health care under this subsection shall be made available for 
inspection and review by representatives of the payer from 
which collection by the United States is sought for the sole 
purpose of permitting the third party to verify--
          (A) that the care or services for which recovery or 
        collection is sought were furnished to the covered 
        beneficiary; and
          (B) that the provisions of such care or services to 
        the covered beneficiary meets criteria generally 
        applicable under the health plan contract involved, 
        except that this paragraph shall be subject to the 
        provisions of paragraphs (2) and (4).
  (9) Amounts collected under this subsection or under 
subsection (h) from a third party payer or from any other payer 
shall be deposited in the Treasury as a miscellaneous 
offsetting receipt.
  (10) For purposes of this section--
          (A) the term ``covered beneficiary'' means an 
        individual eligible to receive health care under this 
        section whose health care costs are to be paid by a 
        third-party payer under a contractual agreement with 
        such payer;
          (B) the term ``services'', as used in ``health care 
        services'' includes products; and
          (C) the term ``third-party payer'' means an entity 
        that provides a fee-for-service insurance policy, 
        contract, or similar agreement through the Federal 
        Employees Health Benefit program, under which the 
        expenses of health care services for individuals are 
        paid.
  (h) In the case of a person, other than a covered 
beneficiary, who receives health care services pursuant to this 
section, the Secretary of State is authorized to collect from 
such person the reasonable costs of health care services 
incurred by the Department of State on behalf of such person. 
The United States shall have the same rights against persons 
subject to the provisions of this subsection as against third-
party payers covered by subsection (g).
          * * * * * * *
                              ----------                              


      SECTION 8 OF THE EISENHOWER EXCHANGE FELLOWSHIP ACT OF 1990

SEC. 8. EXTENSION OF AU PAIR PROGRAMS.

  The United States Information Agency shall continue to 
implement the au pair programs designated by the [Director of 
United States Information Agency] Secretary of State as of July 
10, 1990, until such au pair programs are authorized and 
implemented by another agency of the United States Government. 
Notwithstanding section 555 of Public Law 100-461 and title III 
of S. 2757 as reported by the Senate Committee on Foreign 
Relations on September 7, 1988 (pursuant to the enactment under 
section 555 of Public Law 100-461), the Director of the United 
States Information Agency is authorized to administer such au 
pair programs through fiscal year 1995 in a manner consistent 
with the requirements of the Mutual Educational and Cultural 
Exchange Act of 1961 and shall promulgate regulations regarding 
such au pair programs.
                              ----------                              


     SECTION 602 OF THE NATIONAL AND COMMUNITY SERVICE ACT OF 1990

SEC. 602. EXCHANGE PROGRAM WITH COUNTRIES IN TRANSITION FROM 
                    TOTALITARIANISM TO DEMOCRACY.

  (a) Authorization of Activities; Grants or Contracts for 
Exchanges With Foreign Countries.--Pursuant to the Mutual 
Educational and Cultural Exchange Act of 1961 and using the 
authorities contained therein, the President is authorized, 
when the President considers that it would strengthen 
international cooperative relations, to provide, by grant, 
contract, or otherwise, for exchanges with countries that are 
in transition from totalitarianism to democracy, which include, 
but are not limited to Poland, Hungary, Czechoslovakia, 
Bulgaria, and Romania--
          (1) by financing studies, research, instruction, and 
        related activities--
                  (A) of or for American citizens and nationals 
                in foreign countries; and
                  (B) of or for citizens and nationals of 
                foreign countries in American private 
                businesses, trade associations, unions, 
                chambers of commerce, and local, State, and 
                Federal Government agencies, located in or 
                outside the United States; and
          (2) by financing visits and interchanges between the 
        United States and countries in transition from 
        totalitarianism to democracy.
The program under this section shall be coordinated by the 
[United States Information Agency] Department of State.
  (b) Transfer of Funds.--The President is authorized to 
transfer to the [appropriations account of the United States 
Information Agency] appropriate appropriations account of the 
Department of State such sums as the President shall determine 
to be necessary out of the travel accounts of the departments 
and agencies of the United States, except for the Department of 
State [and the United States Information Agency], as the 
President shall designate. Such transfers shall be subject to 
the approval of the Committee on Appropriations of the House of 
Representatives and the Committee on Appropriations of the 
Senate. In addition, the President is authorized to accept such 
gifts or cost-sharing arrangements as may be proffered to 
sustain the program under this section.
                              ----------                              


           CONVENTION ON CULTURAL PROPERTY IMPLEMENTATION ACT

          * * * * * * *

      TITLE III--IMPLEMENTATION OF CONVENTION ON CULTURAL PROPERTY

SEC. 301. SHORT TITLE.

    This title may be cited as the ``Convention on Cultural 
Property Implementation Act''.
          * * * * * * *

SEC. 305. DESIGNATION OF MATERIALS COVERED BY AGREEMENTS OR EMERGENCY 
                    ACTIONS.

    After any agreement enters into force under section 303, or 
emergency action is taken under section 304, the Secretary, 
after consultation with the [Director of the United States 
Information Agency] Secretary of State, shall by regulation 
promulgate (and when appropriate shall revise) a list of the 
archaeological or ethnological material of the State Party 
covered by the agreement or by such action. The Secretary may 
list such material by type or other appropriate classification, 
but each listing made under this section shall be sufficiently 
specific and precise to insure that (1) the import restrictions 
under section 307 are applied only to the archaeological and 
ethnological material covered by the agreement or emergency 
action; and (2) fair notice is given to importers and other 
persons as to what material is subject to such restrictions.

SEC. 306. CULTURAL PROPERTY ADVISORY COMMITTEE.

    (A) * * *
          * * * * * * *
    (E) Staff and Administration.--
          (1) The [Director of the United States Information 
        Agency] Secretary of State shall make available to the 
        Committee such administrative and technical support 
        services and assistance as it may reasonably require to 
        carry out its activities. Upon the request of the 
        Committee, the head of any other Federal agency may 
        detail to the Committee, on a reimbursable basis, any 
        of the personnel of such agency to assist the Committee 
        in carrying out its functions, and provide such 
        information and assistance as the Committee may 
        reasonably require to carry out its activities.
          (2) The Committee shall meet at the call of the 
        [Director of the United States Information Agency] 
        Secretary of State, or when a majority of its members 
        request a meeting in writing.
          * * * * * * *
      (i) Confidential Information.--
          (1) In general.--Any information (including trade 
        secrets and commercial or financial information which 
        is privileged or confidential) submitted in confidence 
        by the private sector to officers or employees of the 
        United States or to the Committee in connection with 
        the responsibilities of the Committee shall not be 
        disclosed to any person other than to--
                  (A) officers and employees of the United 
                States designated by the [Director of the 
                United States Information Agency] Secretary of 
                State;
          * * * * * * *
          (2) Governmental information.--Information submitted 
        in confidence by officers or employees of the United 
        States to the Committee shall not be disclosed other 
        than in accordance with rules issued by the [Director 
        of the United States Information Agency] Secretary of 
        State, after consultation with the Committee. Such 
        rules shall define the categories of information which 
        require restricted or confidential handling by such 
        Committee considering the extent to which public 
        disclosure of such information can reasonably be 
        expected to prejudice the interests of the United 
        States. Such rules shall, to the maximum extent 
        feasible, permit meaningful consultations by Committee 
        members with persons affected by proposed agreements 
        authorized by this title.
          * * * * * * *
                              ----------                              


              SECTION 901 OF TITLE 31, UNITED STATES CODE

Sec. 901. Establishment of agency Chief Financial Officers

  (a) * * *
  (b)(1) The agencies referred to in subsection (a)(1) are the 
following:
          (A) * * *
          * * * * * * *
  (2) The agencies referred to in subsection (a)(2) are the 
following:
          [(A) The Agency for International Development.]
          * * * * * * *
                              ----------                              


       AGRICULTURAL TRADE DEVELOPMENT AND ASSISTANCE ACT OF 1954

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Agricultural Trade Development 
and Assistance Act of 1954''.
          * * * * * * *

          TITLE II--EMERGENCY AND PRIVATE ASSISTANCE PROGRAMS

SEC. 201. GENERAL AUTHORITY.

  The President shall establish a program under this title to 
provide agricultural commodities to foreign countries on behalf 
of the people of the United States to--
          (1) * * *
          * * * * * * *
Such program shall be implemented by the [Administrator] Under 
Secretary for Development and Economic Affairs.

SEC. 202. PROVISION OF AGRICULTURAL COMMODITIES.

  (a) Emergency Assistance.--Notwithstanding any other 
provision of law, the [Administrator] Under Secretary for 
Development and Economic Affairs may provide agricultural 
commodities to meet emergency food needs under this title 
through governments and public or private agencies, including 
intergovernmental organizations such as the World Food Program 
and other multilateral organizations, in such manner and on 
such terms and conditions as the [Administrator] Under 
Secretary for Development and Economic Affairs determines 
appropriate to respond to the emergency.
  (b) Non-Emergency Assistance.--The [Administrator] Under 
Secretary for Development and Economic Affairs may provide 
agricultural commodities for non-emergency assistance under 
this title through eligible organizations (as described in 
subsection (d)) that have entered into an agreement with the 
[Administrator] Under Secretary for Development and Economic 
Affairs to use such commodities in accordance with this title.
          * * * * * * *
  (d) Eligible Organizations.--To be eligible to receive 
assistance under subsection (b) an organization shall be--
          (1) a private voluntary organization or cooperative 
        that is, to the extent practicable, registered with the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs; or
          (2) an intergovernmental organization, such as the 
        World Food Program.
  (e) Support for Private Voluntary Organizations and 
Cooperatives.--
          (1) In general.--Of the funds made available in each 
        fiscal year under this title to the [Administrator] 
        Under Secretary for Development and Economic Affairs, 
        not less than $10,000,000, and not more than 
        $13,500,000, shall be made available in each fiscal 
        year to private voluntary organizations and 
        cooperatives to assist such organizations and 
        cooperatives in--
                  (A) * * *
          * * * * * * *
          (2) Request for funds.--In order to receive funds 
        made available under paragraph (1), a private voluntary 
        organization or cooperative must submit a request for 
        such funds (which must be approved by the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs) when submitting a proposal to the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs for an agreement under this title. 
        Such request for funds shall include a specific 
        explanation of--
                  (A) * * *
          * * * * * * *
          (3) Assistance with respect to sale.--Upon the 
        request of a private voluntary organization or 
        cooperative, the [Administrator] Under Secretary for 
        Development and Economic Affairs may provide assistance 
        to that organization or cooperative with respect to the 
        sale of agricultural commodities made available to it 
        under this title.
  (f) Effective Use of Commodities.--To ensure that 
agricultural commodities made available under this title are 
used effectively and in the areas of greatest need, 
organizations or cooperatives through which such commodities 
are distributed shall--
          (1) * * *
          * * * * * * *
          (4) recommend to the [Administrator] Under Secretary 
        for Development and Economic Affairs methods of making 
        assistance available that are the most appropriate for 
        each local setting;
          * * * * * * *

SEC. 203. GENERATION AND USE OF FOREIGN CURRENCIES BY PRIVATE VOLUNTARY 
                    ORGANIZATIONS AND COOPERATIVES.

  (a) Local Sale and Barter of Commodities.--An agreement 
entered into between the [Administrator] Under Secretary for 
Development and Economic Affairs and a private voluntary 
organization or cooperative to provide food assistance through 
such organization or cooperative under this title may provide 
for the sale or barter in the recipient country of the 
commodities to be provided under such agreement.
  (b) Minimum Level of Local Sales.--In carrying out agreements 
of the type referred to in subsection (a), the [Administrator] 
Under Secretary for Development and Economic Affairs shall 
permit private voluntary organizations and cooperatives to 
sell, in recipient countries, an amount of commodities equal to 
not less than 10 percent of the aggregate amounts of all 
commodities distributed under non-emergency programs under this 
title for each fiscal year, to generate foreign currency 
proceeds to be used as provided in this section.
  (c) Description of Intended Uses.--A private voluntary 
organization or cooperative submitting a proposal to enter into 
a non-emergency food assistance agreement under this title 
shall include in such proposal a description of the intended 
uses of any foreign currency proceeds that may be generated 
through the sale, in the recipient country, of any commodities 
provided under an agreement entered into between the 
[Administrator] Under Secretary for Development and Economic 
Affairs and the organization or cooperative.

SEC. 204. LEVELS OF ASSISTANCE.

  (a) Minimum Levels.--
          (1) Minimum assistance.--Except as provided in 
        paragraph (3), the [Administrator] Under Secretary for 
        Development and Economic Affairs shall make 
        agricultural commodities available for food 
        distribution under this title in an amount that--
                  (A) * * *
          * * * * * * *
          (2) Minimum non-emergency assistance.--Of the amounts 
        specified in paragraph (1), and except as provided in 
        paragraph (3), the [Administrator] Under Secretary for 
        Development and Economic Affairs shall make 
        agricultural commodities available for non-emergency 
        food distribution through eligible organizations under 
        section 202 in an amount that--
                  (A) * * *
          * * * * * * *
          (3) Exception.--The [Administrator] Under Secretary 
        for Development and Economic Affairs may waive the 
        requirements of paragraphs (1) and (2) for any fiscal 
        year if the [Administrator] Under Secretary for 
        Development and Economic Affairs determines that such 
        quantities of commodities cannot be used effectively to 
        carry out this title or in order to meet an emergency. 
        In making a waiver under this paragraph, the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs shall prepare and submit to the 
        Committee on Foreign Affairs and Committee on 
        Agriculture of the House of Representatives, and the 
        Committee on Agriculture, Nutrition, and Forestry of 
        the Senate a report containing the reasons for the 
        waiver.
  (b) Use of Value-Added Commodities.--
          (1) Minimum levels.--Except as provided in paragraph 
        (2), in making agricultural commodities available under 
        this title, the [Administrator] Under Secretary for 
        Development and Economic Affairs shall ensure that not 
        less than 75 percent of the quantity of such 
        commodities required to be distributed during each 
        fiscal year under subsection (a)(2) be in the form of 
        processed, fortified, or bagged commodities.
          (2) Waiver of minimum.--The [Administrator] Under 
        Secretary for Development and Economic Affairs may 
        waive the requirement of paragraph (1) for any fiscal 
        year in which the [Administrator] Under Secretary for 
        Development and Economic Affairs determines that the 
        requirements of the programs established under this 
        title will not be best served by the enforcement of 
        such requirement under such paragraph.

SEC. 205. FOOD AID CONSULTATIVE GROUP.

  (a) * * *
  (b) Membership.--The Group shall be composed of--
          (1) the [Administrator] Under Secretary for 
        Development and Economic Affairs;
          * * * * * * *
          (5) representatives from African, Asian and Latin 
        American indigenous non-governmental organizations 
        determined appropriate by the [Administrator] Under 
        Secretary for Development and Economic Affairs.
  (c) Chairperson.--The [Administrator] Under Secretary for 
Development and Economic Affairs shall be the chairperson of 
the Group.
  (d) Consultations.--In preparing regulations, handbooks, or 
guidelines implementing this title, or significant revisions 
thereto, the [Administrator] Under Secretary for Development 
and Economic Affairs shall provide such proposals to the Group 
for review and comment. The [Administrator] Under Secretary for 
Development and Economic Affairs shall consult and, when 
appropriate, meet with the Group regarding such proposed 
regulations, handbooks, guidelines, or revisions thereto prior 
to the issuance of such.

SEC. 207. ADMINISTRATION.

  (a) Proposals.--
          (1) Time for decision.--Not later than 45 days after 
        the receipt by the [Administrator] Under Secretary for 
        Development and Economic Affairs of a proposal 
        submitted--
                  (A) by a private voluntary organization or 
                cooperative, with the concurrence of the 
                appropriate United States field mission, for 
                commodities; or
                  (B) by a United States field mission to make 
                commodities available to a private voluntary 
                organization or cooperative;
        under this title, the [Administrator] Under Secretary 
        for Development and Economic Affairs shall make a 
        decision concerning such proposal.
          (2) Denial.--If a proposal under paragraph (1) is 
        denied, the response shall specify the reasons for 
        denial and the conditions that must be met for the 
        approval of such proposal.
  (b) Notice and Comment.--Not later than 30 days prior to the 
issuance of a final guideline to carry out this title, the 
[Administrator] Under Secretary for Development and Economic 
Affairs shall--
          (1) * * *
          * * * * * * *
  (c) Regulations.--
          (1) In general.--The [Administrator] Under Secretary 
        for Development and Economic Affairs shall promptly 
        issue all necessary regulations and make revisions to 
        agency guidelines with respect to changes in the 
        operation or implementation of the program established 
        under this title.
          (2) Requirements.--The [Administrator] Under 
        Secretary for Development and Economic Affairs shall 
        develop regulations with the intent of--
                  (A) * * *
          * * * * * * *
          (3) Handbooks.--Handbooks developed by the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs to assist in carrying out the program 
        under this title shall be designed to foster the 
        development of programs under this title by eligible 
        organizations.
          * * * * * * *

                    TITLE III--FOOD FOR DEVELOPMENT

SEC. 301. BILATERAL GRANT PROGRAM.

  (a) In General.--The President shall establish a program 
under which agricultural commodities are donated in accordance 
with this title to least developed countries. The revenue 
generated by the sale of such commodities in the recipient 
country may be utilized for economic development activities. 
Such program shall be implemented by the [Administrator] Under 
Secretary for Development and Economic Affairs.
  (b) General Authority.--To carry out the policies and 
accomplish the objectives described in section 2, the 
[Administrator] Under Secretary for Development and Economic 
Affairs may negotiate and execute agreements with least 
developed countries to provide commodities to such countries on 
a grant basis.

SEC. 302. ELIGIBLE COUNTRIES.

  (a) Least Developed Countries.--A country shall be considered 
to be a least developed country and eligible for the donation 
of agricultural commodities under this title if--
          (1) such country meets the poverty criteria 
        established by the International Bank for 
        Reconstruction and Development for Civil Works 
        Preference for providing financial assistance; or
          (2) such country is a food deficit country and is 
        characterized by high levels of malnutrition among 
        significant numbers of its population, as determined by 
        the [Administrator] Under Secretary for Development and 
        Economic Affairs under subsection (b).
  (b) Indicators of Food Deficit Countries.--To make a finding 
under subsection (a)(2) that a country is a food deficit 
country and is characterized by high levels of malnutrition, 
the [Administrator] Under Secretary for Development and 
Economic Affairs must determine that the country meets all of 
the following indicators of national food deficit and 
malnutrition:
          (1) * * *
          * * * * * * *
  (c) Priority.--In determining whether and to what extent 
agricultural commodities shall be made available to least 
developed countries under this title, the [Administrator] Under 
Secretary for Development and Economic Affairs shall give 
priority to countries that--
          (1) * * *
          * * * * * * *

SEC. 303. GRANT PROGRAMS.

  To carry out the policies and accomplish the objectives 
described in section 2, the [Administrator] Under Secretary for 
Development and Economic Affairs may negotiate and execute 
agreements with least developed countries to provide 
commodities to such countries on a grant basis either through 
the Commodity Credit Corporation or through private trade 
channels.

SEC. 304. DIRECT USES OR SALES OF COMMODITIES.

  Agricultural commodities provided to a least developed 
country under this section--
          (1) * * *
          (2) may be sold in such country by the government of 
        the country or the [Administrator] Under Secretary for 
        Development and Economic Affairs (or their designees) 
        as provided in the agreement, and the proceeds of such 
        sale used in accordance with this title.

SEC. 305. LOCAL CURRENCY ACCOUNTS.

  (a) Retention of Proceeds.--To the extent determined to be 
appropriate by the [Administrator] Under Secretary for 
Development and Economic Affairs, revenues generated from the 
sale, under section 304(2), of agricultural commodities 
provided under this title shall be deposited into a separate 
account (that may be interest bearing) in the recipient country 
to be disbursed for the benefit of such country in accordance 
with local currency agreements entered into between the 
recipient country and the [Administrator] Under Secretary for 
Development and Economic Affairs. The [Administrator] Under 
Secretary for Development and Economic Affairs may determine 
not to deposit such revenues in a separate account if--
          (1) local currencies are to be programmed for 
        specific economic development purposes listed in 
        section 306(a); and
          (2) the recipient country programs an equivalent 
        amount of money for such purposes as specified in an 
        agreement entered into by the [Administrator] Under 
        Secretary for Development and Economic Affairs and the 
        recipient country.
  (b) Ownership and Programming of Accounts.--The proceeds of 
sales pursuant to section 304(2) shall be the property of the 
recipient country or the United States, as specified in the 
applicable agreement. Such proceeds shall be utilized for the 
benefit of the recipient country, shall be jointly programmed 
by the [Administrator] Under Secretary for Development and 
Economic Affairs and the government of the recipient country, 
and shall be disbursed for the benefit of such country in 
accordance with local currency agreements between the 
[Administrator] Under Secretary for Development and Economic 
Affairs and that government.
  (c) Overall Development Strategy.--The [Administrator] Under 
Secretary for Development and Economic Affairs shall consider 
the local currency proceeds as an integral part of the overall 
development strategy of the Agency for International 
Development and the recipient country.

SEC. 306. USE OF LOCAL CURRENCY PROCEEDS.

  (a) * * *
          * * * * * * *
  (d) Support for Certain Educational Institutions.--If the 
[Administrator] Under Secretary for Development and Economic 
Affairs determines that local currencies deposited in a special 
account pursuant to this title are not needed for any of the 
activities prescribed in paragraphs (1) through (13) of 
subsection (a) or for any other specific economic development 
purpose in the recipient country, the [Administrator] Under 
Secretary for Development and Economic Affairs may use those 
currencies to provide support for any institution (other than 
an institution whose primary purpose is to provide religious 
education) located in the recipient country that provides 
education in agricultural sciences or other disciplines for a 
significant number of United States nationals (who may include 
members of the United States Armed Forces or the Foreign 
Service or dependents of such members).

             TITLE IV--GENERAL AUTHORITIES AND REQUIREMENTS

          * * * * * * *

SEC. 402. DEFINITIONS.

  As used in this Act:
          (1) [Administrator] Under Secretary for Development 
        and Economic Affairs.--The term ``[Administrator] Under 
        Secretary for Development and Economic Affairs'' means 
        the [Administrator] Under Secretary for Development and 
        Economic Affairs of the Agency for International 
        Development, unless otherwise specified in this Act.
          * * * * * * *

SEC. 403. GENERAL PROVISIONS.

  (a) * * *
  (b) Consultations.--The Secretary or the [Administrator] 
Under Secretary for Development and Economic Affairs, as 
appropriate, shall consult with representatives from the 
International Monetary Fund, the International Bank for 
Reconstruction and Development, the World Bank, and other donor 
organizations to ensure that the importation of United States 
agricultural commodities and the use of local currencies for 
development purposes will not have a disruptive impact on the 
farmers or the local economy of the recipient country.
  (c) Transshipment.--The Secretary or the [Administrator] 
Under Secretary for Development and Economic Affairs, as 
appropriate, shall, under such terms and conditions as are 
determined to be appropriate, require commitments from 
countries designed to prevent or restrict the resale or 
transshipment to other countries, for use for other than 
domestic purposes, of agricultural commodities donated or 
purchased under this Act.
          * * * * * * *
  (g) Participation of Private Sector.--The Secretary or the 
[Administrator] Under Secretary for Development and Economic 
Affairs, as appropriate, shall encourage the private sector of 
the United States and private importers in developing countries 
to participate in the programs established under this Act.
  (h) Safeguard Usual Marketings.--In carrying out this Act, 
reasonable precautions shall be taken to safeguard the usual 
marketings of the United States and to avoid displacing any 
sales of the United States agricultural commodities that the 
Secretary or [Administrator] Under Secretary for Development 
and Economic Affairs determines would otherwise be made.
  (i) Military Distribution of Food Aid.--
          (1) In general.--The Secretary or the [Administrator] 
        Under Secretary for Development and Economic Affairs, 
        as appropriate, shall attempt to ensure that 
        agricultural commodities made available under this Act 
        will be provided without regard to the political 
        affiliation, geographic location, ethnic, tribal, or 
        religious identity of the recipient or without regard 
        to other extraneous factors.
          (2) Prohibition on handling of commodities by the 
        military.--
                  (A) In general.--Except as provided in 
                subparagraph (B), the Secretary or the 
                [Administrator] Under Secretary for Development 
                and Economic Affairs, as appropriate, shall not 
                enter into an agreement under this Act to 
                provide agricultural commodities if such 
                agreement requires or permits the distribution, 
                handling, or allocation of such commodities by 
                the military forces of any government or 
                insurgent group.
                  (B) Exception.--Notwithstanding subparagraph 
                (A), the Secretary or the [Administrator] Under 
                Secretary for Development and Economic Affairs, 
                as appropriate, may authorize the handling or 
                distribution of commodities by the military 
                forces of a country in exceptional 
                circumstances in which--
                          (i) nonmilitary channels are not 
                        available for such handling or 
                        distribution;
                          (ii) such action is consistent with 
                        the requirements of paragraph (1); and
                          (iii) the Secretary or the 
                        [Administrator] Under Secretary for 
                        Development and Economic Affairs, as 
                        appropriate, determines that such 
                        action is necessary to meet the 
                        emergency health, safety, or 
                        nutritional requirements of the 
                        recipient population.
                  (C) Report.--Not later than 30 days after an 
                authorization is provided under subparagraph 
                (B), the Secretary or the [Administrator] Under 
                Secretary for Development and Economic Affairs, 
                as appropriate, shall prepare and submit to the 
                appropriate committees of Congress a report 
                concerning such authorization and include in 
                any such report the reason for the 
                authorization, including an explanation of why 
                no alternatives to such handling or 
                distribution were available.
          (3) Encouragement of safe passage.--When entering 
        into agreements under this Act that involve areas 
        within recipient countries that are experiencing 
        protracted warfare or civil strife, the Secretary or 
        the [Administrator] Under Secretary for Development and 
        Economic Affairs, as appropriate, shall, to the extent 
        practicable, encourage all parties to the conflict to 
        permit safe passage of the commodities and other relief 
        supplies and to establish safe zones for medical and 
        humanitarian treatment and evacuation of injured 
        persons.
  (j) Violations of Human Rights.--
          (1) Ineligible countries.--The Secretary or the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs, as appropriate, shall not enter into 
        any agreement under this Act to provide agricultural 
        commodities, or to finance the sale of agricultural 
        commodities, to the government of any country 
        determined by the President to engage in a consistent 
        pattern of gross violations of internationally 
        recognized human rights, including--
                  (A) * * *
          * * * * * * *

SEC. 404. AGREEMENTS.

  (a) In General.--Before entering into agreements under titles 
I and III for the provision of commodities, the Secretary or 
the [Administrator] Under Secretary for Development and 
Economic Affairs, as appropriate, shall consider the extent to 
which the recipient country is undertaking measures for 
economic development purposes in order to improve food security 
and agricultural development, alleviate poverty, and promote 
broad-based, equitable, and sustainable development.
  (b) Terms of Agreement.--An agreement entered into under this 
Act shall--
          (1) * * *
          * * * * * * *
          (5) contain such other terms and conditions as the 
        Secretary or the [Administrator] Under Secretary for 
        Development and Economic Affairs, as appropriate, 
        determines to be necessary.
  (c) Multi-year Agreements.--
          (1) In general.--Agreements to provide assistance on 
        a multi-year basis under this Act shall be made 
        available to recipient countries or to eligible 
        organizations.
          (2) Exception.--The Secretary or the [Administrator] 
        Under Secretary for Development and Economic Affairs, 
        as appropriate, may determine not to make assistance 
        available on a multi-year basis with respect to a 
        recipient country or an eligible organization if it is 
        determined that assistance should be provided to such 
        country or through such organization only on an annual 
        basis because--
                  (A) * * *
          * * * * * * *
                  (C) other circumstances, as determined by the 
                Secretary or the [Administrator] Under 
                Secretary for Development and Economic Affairs, 
                as appropriate, indicate there is only a need 
                for a 1 year agreement.
  (d) Review of Agreements.--The Secretary or the 
[Administrator] Under Secretary for Development and Economic 
Affairs, as appropriate, may make a determination to terminate, 
or refuse to enter into, a multi-year agreement with respect to 
a recipient country if the Secretary or the [Administrator] 
Under Secretary for Development and Economic Affairs determines 
that such country is not fulfilling the objectives or 
requirements of this Act. In making such a determination, the 
Secretary or the [Administrator] Under Secretary for 
Development and Economic Affairs, as appropriate, may consider 
the extent to which the country is--
          (1) * * *
          * * * * * * *

SEC. 405. CONSULTATION.

  The Secretary and the [Administrator] Under Secretary for 
Development and Economic Affairs shall cooperate and consult in 
the implementation of this Act.
          * * * * * * *

SEC. 407. ADMINISTRATIVE PROVISIONS.

  (a) * * *
          * * * * * * *
  (d) Titles II and III Program.--
          (1) Acquisition.--The [Administrator] Under Secretary 
        for Development and Economic Affairs shall transfer, 
        arrange for the transportation, and take other steps 
        necessary to make available agricultural commodities to 
        be provided under title II and title III.
          (2) Full and Open Competition.--No purchase of 
        agricultural commodities from private stocks or 
        purchase of ocean transportation services by the United 
        States Government shall be financed under titles II and 
        III unless such purchases are made on the basis of full 
        and open competition utilizing such procedures as are 
        determined necessary and appropriate by the 
        [Administrator] Under Secretary for Development and 
        Economic Affairs.
          (4) Ocean Transportation Services.--Notwithstanding 
        any provision of the Federal Property and 
        Administrative Services Act of 1949 (40 U.S.C. 471 et 
        seq.) or other similar provisions relating to the 
        making or performance of Federal Government contracts, 
        the [Administrator] Under Secretary for Development and 
        Economic Affairs may procure ocean transportation 
        services under this Act under such full and open 
        competitive procedures as the [Administrator] Under 
        Secretary for Development and Economic Affairs 
        determines are necessary and appropriate.
  (e) Timing of Shipments.--In determining the timing of the 
shipment of agricultural commodities to be provided under this 
Act, the Secretary or the [Administrator] Under Secretary for 
Development and Economic Affairs, as appropriate, shall 
consider--
          (1) * * *
          * * * * * * *
  (h) World Food Day Report.--On World Food Day, October 16 of 
each year, the President shall submit to the appropriate 
committees of Congress a report, prepared with the assistance 
of the Secretary and the [Administrator] Under Secretary for 
Development and Economic Affairs, assessing progress towards 
food security in each country receiving United States 
Government food assistance. Special emphasis should be given in 
such report to the nutritional status of the poorest 
populations in such countries.
          * * * * * * *

               Congressional Budget Office Cost Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 29, 1995.
Hon. Benjamin A. Gilman,
Chairman, Committee on International Relations,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office (CBO) 
has prepared the enclosed cost estimate for the reconciliation 
recommendations approved by the House Committee on 
International Relations on September 27, 1995.
    The estimate shows the budgetary effects of the committee's 
legislative proposals over the 1996-2002 period. CBO 
understands that the Committee on the Budget will be 
responsible for interpreting how these proposals compare with 
the reconciliation instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               congressional budget office cost estimate

    1. Bill number: Not yet assigned.
    2. Bill title: Reconciliation Recommendations of the House 
Committee on International Relations.
    3. Bill status: As ordered reported by the House Committee 
on International Relations on September 27, 1995.
    4. Bill purpose: The bill would authorize the Secretary of 
State to recover from insurance companies the reasonable costs 
of health care services provided by the department and would 
reorganize and consolidate foreign affairs agencies.
    5. Estimated cost to the Federal Government: The table 
summarizes the budgetary effects of the proposals on direct 
spending and authorizations of appropriations for the 1996-2002 
period.
    6. Basis of estimate: The estimate assumes the 
reconciliation bill will be enacted by November 15, 1995; the 
estimate could change if the bill is enacted later. The bill 
would authorize the Secretary of State to recover from 
insurance companies the reasonable costs of health care 
services provided by the department. The provision would 
increase offsetting receipts, mandatory payments for Federal 
Employee Health Benefits [FEHB], and discretionary 
appropriations. CBO estimates that the department will collect 
$4 million in 1996 and $11.5 million in 1997. Collections in 
1998 through 2002 were estimated assuming that collections grow 
at the same rate as inflation in health care costs. The bill 
requires the department to deposit the collections in the 
Treasury as miscellaneous offsetting receipts.
    CBO assumes that after a short lag, insurance companies 
would recover the amount paid to the State Department plus 15 
percent for administrative overhead through higher FEHB 
premiums. The Government pays 72 percent of FEHB premiums; of 
this, 45 percent is paid through a mandatory Government payment 
for annuitants and 55 percent is paid through discretionary 
appropriations for active workers. Mandatory spending would 
average about $5 million a year, and discretionary spending 
would average $6 million a year.

----------------------------------------------------------------------------------------------------------------
                                                     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                DISTRICT SPENDING                                               
                                                                                                                
Receipts from insurers:                                                                                         
    Estimated budget authority...................       -4      -12      -13      -14      -14      -16      -17
    Estimated outlays............................       -4      -12      -13      -14      -14      -16      -17
Government payments for annuitants' health                                                                      
 benefits:                                                                                                      
    Estimated budget authority...................        0        4        5        5        5        6        6
    Estimated outlays............................        0        4        5        5        5        6        6
Total direct spending:                                                                                          
    Estimated budget authority...................       -4       -8       -8       -9       -9      -10      -11
    Estimated outlays............................       -4       -8       -8       -9       -9      -10      -11
                                                                                                                
                                  SPENDING SUBJECT TO APPROPRIATIONS ACTION \1\                                 
                                                                                                                
Agency payments for health benefits of active                                                                   
 workers:                                                                                                       
    Estimated authorization level................        0        4        5        6        6        7        7
    Estimated outlays............................        0        4        5        6        6        7        7
----------------------------------------------------------------------------------------------------------------
\1\ The table shows the budgetary impact of the health care provisions in the bill; it does not reflect the     
  potential budgetary impact of consolidating foreign affairs agencies.                                         

    The spending falls in budget functions 150 (international 
affairs) and 550 (health).
    The bill would authorize the consolidation of foreign 
affairs agencies. The Arms Control and Disarmament Agency, the 
U.S. Information Agency and the Agency for International 
Development would be abolished, and their functions, personnel, 
unexpended appropriations, authorizations, assets and 
liabilities transferred to the Department of State. The 
Secretary of State would be granted limited authority to 
reorganize functions and to facilitate the transition. CBO 
cannot estimate the budgetary impact of consolidation because 
it could be accomplished in many ways. Costs or savings would 
depend on how the agencies are consolidated.
    7. Estimated cost to State and local governments: None.
    8. Estimate comparison: None.
    9. Previous CBO estimate: None.
    10. Estimate prepared by: Joseph C. Whitehill, Jeffrey 
Lemieux, and Sunita D'Monte.
    11. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Oversight Findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the committee reports 
that the findings and recommendations of the committee, based 
on oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report. Among the principal 
oversight activities which contributed to the committee's 
formulation of its recommendations to the Budget Committee 
were:
    Extensive hearings and review of the executive branch's 
budget request for programs authorized by this legislation by 
the full Committee and by the Subcommittees on International 
Economic Policy and Trade; on International Operations and 
Human Rights; on the Western Hemisphere; on Africa; and on Asia 
and the Pacific; and
    Ongoing consultations between committee members and staff 
and executive branch officials.
    As a result of these oversight activities, the committee 
recommends that the House approve the committee's 
recommendations to the Budget Committee as reported.

         Committee on Government Reform and Oversight Findings

    No findings or recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI of the Rules of the House of 
Representatives.
                 TITLE VII--COMMITTEE ON THE JUDICIARY

                          House of Representatives,
                                Committee on the Judiciary,
                                Washington, DC, September 19, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear John: Pursuant to the reconciliation directives 
contained in the Conference Report on House Concurrent 
Resolution 67, the budget resolution for fiscal year 1996, I am 
pleased to transmit the reconciliation recommendations for 
programs within the jurisdiction of the Committee on the 
Judiciary. This legislative language was approved by the full 
Committee on the Judiciary on September 12, 1995, by a vote of 
18-12. A copy of the legislation (i.e. ``Committee Print'') is 
enclosed.
    The budget resolution instructs the Committee on the 
Judiciary to report changes in laws within its jurisdiction 
that provide direct spending levels of $2,580,000,000 in fiscal 
year 1996, $13,734,000,000 for fiscal year 1996 through fiscal 
year 2000, and $19,530,000,000 for fiscal year 1996 through 
fiscal year 2002.
    I hope that these recommendations will be of assistance to 
your committee in meeting the reconciliation targets.
            Sincerely,
                                             Henry J. Hyde,
                                                          Chairman.
    Attachment.

                           table of contents

                                                                   Page
Transmittal letter...............................................   527
Purpose and summary..............................................   527
Background and need for legislation..............................   528
Hearings.........................................................   528
Section-by-section analysis......................................   529
Changes in existing law..........................................   529
Committee consideration..........................................   530
Vote of the committee............................................   530
Congressional Budget Office estimate.............................   531
Committee oversight findings.....................................   532
Committee on Government Reform and Oversight findings............   533

                          Purpose and Summary

    Under House Concurrent Resolution 67, the concurrent 
resolution on the budget adopted earlier this year, the 
authorizing committees are to report legislation necessary to 
achieve specified direct spending and revenue levels. That 
budget resolution directs the Committee on the Judiciary to 
produce budget savings of $119 million per year for fiscal 
years 1999, 2000, 2001, and 2002, or $476 million for the 4-
year period. The proposed legislation approved by the committee 
meets the committee's budget reconciliation instructions by 
extending patent fee surcharges established in the Omnibus 
Budget Reconciliation Act of 1990 for an additional 4 years.

                Background and Need for the Legislation

    Before fiscal year 1991, Congress funded the Patent and 
Trademark Office [``PTO''] through a combination of 
appropriations and the user fees set by statute in 35 U.S.C. 
Sec. 41. As part of the agreement that came out of the 1990 
budget summit, Congress decided that the PTO should become 
completely funded by user fees.
    To accomplish that purpose, section 10101 of the Omnibus 
Budget Reconciliation Act of 1990 (35 U.S.C. Sec. 41 note) 
established a surcharge on the existing statutory fees. Section 
10101 originally provided for these surcharges only in the 
fiscal years 1991 through 1995. In each of those years, the 
legislation provided that the surcharge would provide a 
specified amount of revenue--$109.807 million in fiscal year 
1991; $95 million in fiscal year 1992; $99 million in fiscal 
year 1993; $103 million in fiscal year 1994; and $107 million 
in fiscal year 1995. The legislation left it to the 
Commissioner of Patents and Trademarks to decide how the 
surcharges would be set to raise these amounts.
    The legislation provided that these amounts would be used 
for the benefit of the PTO ``to the extent provided in 
appropriations acts.'' Over the years, Congress has 
appropriated approximately 90 percent of this money for the use 
of the PTO.
    The Omnibus Budget Reconciliation Act of 1993 extended 
these surcharges through fiscal year 1998. That legislation 
called for the surcharges to raise the following amounts: $111 
million in fiscal year 1996; $115 million in fiscal year 1997; 
and $119 million in fiscal year 1998. The 1993 act made no 
change to the mechanism by which the surcharges were set.
    This year's budget resolution directed the Committee on the 
Judiciary to authorize a contribution to deficit reduction from 
programs under the committee's jurisdiction of $119 million per 
year for the fiscal years 1999 through 2002. The budget 
resolution conferees expected that extending the patent fee 
surcharges for an additional 4 years would be the most likely 
option for the committee in making this contribution.
    Accordingly, the proposed legislation approved by the 
committee extends the patent fee surcharges at the fiscal year 
1998 level of $119 million for the fiscal years 1999 through 
2002. The proposed legislation does not change the mechanism 
for setting the surcharges, and the revenues raised by the 
surcharge remain subject to appropriations.

                                Hearings

    The committee held no hearings on this proposed legislation 
during the 104th Congress.

                      Section-by-Section Analysis

Sec. 7001. Patent and trademark fees

    The proposed legislation approved by the committee consists 
of one section numbered 7001 so that it can be included within 
the omnibus budget reconciliation bill at the appropriate 
place. Section 7001 amends section 10101 of the Omnibus Budget 
Reconciliation Act of 1990 (35 U.S.C. Sec. 41 note) to extend 
the patent fee surcharges established by that act through 
fiscal year 2002.
    Under current law, these patent fee surcharges are set to 
expire at the end of fiscal year 1998. Section 7001 extends 
these patent fee surcharges at the fiscal year 1998 level of 
$119 million per year for the fiscal years 1999 through 2002, 
or $476 million for the 4-year period.
    Under current law, the statute sets forth an overall amount 
that must be raised through the surcharge and the Commissioner 
of Patent and Trademarks is directed to set the surcharges so 
as to raise that overall amount. Section 7001 makes no change 
to the existing mechanism for setting the fees.

 Changes in Existing Law Made by the Title VII of the Bill, as Reported

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
title VII of the bill, as reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman):

               OMNIBUS BUDGET RECONCILIATION ACT OF 1990

          * * * * * * *

         TITLE X--MISCELLANEOUS USER FEES AND OTHER PROVISIONS

          * * * * * * *

           Subtitle B--Patent and Trademark Office User Fees

SEC. 10101. PATENT AND TRADEMARK OFFICE USER FEES.

    (a) Surcharges.--There shall be a surcharge, during fiscal 
years 1991 through [1998] 2002, on all fees authorized by 
subsections (a) and (b) of section 41 of title 35, United 
States Code, in order to ensure that the amounts specified in 
subsection (c) are collected.
    (b) Use of Surcharges.--Notwithstanding section 3302 of 
title 31, United States Code, beginning in fiscal year 1991, 
all surcharges collected by the Patent and Trademark Office--
          (1) * * *
          (2) in fiscal years 1992 through [1998] 2002--
                  (A) shall be credited to a separate account 
                established in the Treasury and ascribed to the 
                Patent and Trademark Office activities in the 
                Department of Commerce as offsetting receipts, 
                and
                  (B) shall be available only to the Patent and 
                Trademark Office, to the extent provided in 
                appropriation Acts, for all authorized 
                activities and operations of the office, 
                including all direct and indirect costs of 
                services provided by the office, and
          (3) shall remain available until expended.
    (c) Establishment of Surcharges.--In fiscal years 1991 
through [1998] 2002, the Commissioner of Patents and Trademarks 
shall establish surcharges under subsection (a), subject to the 
provisions of section 553 of title 5, United States Code, in 
order to ensure that the following amounts, but not more than 
the following amounts, of patent and trademark user fees are 
collected:
          (1) $109,807,000 in fiscal year 1991.
          (2) $95,000,000 in fiscal year 1992.
          (3) $99,000,000 in fiscal year 1993.
          (4) $103,000,000 in fiscal year 1994.
          (5) $107,000,000 in fiscal year 1995.
          (6) $111,000,000 in fiscal year 1996.
          (7) $115,000,000 in fiscal year 1997.
          (8) $119,000,000 in fiscal year 1998.
          (9) $119,000,000 in fiscal year 1999.
          (10) $119,000,000 in fiscal year 2000.
          (11) $119,000,000 in fiscal year 2001.
          (12) $119,000,000 in fiscal year 2002.
          * * * * * * *

                        Committee Consideration

    On September 12, 1995, the full committee met in open 
session and ordered reported to the Budget Committee for 
inclusion in the omnibus budget reconciliation bill the 
proposed legislation contained in the committee print by a 
rollcall vote of 18 to 12, a quorum being present.

                         Vote of the Committee

    The following rollcall took place during committee 
deliberations on the proposed legislation contained in the 
committee print (September 12, 1995).
    1. The motion to favorably report the proposed legislation 
contained in the committee print to the Committee on the 
Budget. The motion was agreed to by a rollcall vote of 18 to 
12.

                             rollcall no. 1

    Subject: Proposed language for insertion in omnibus budget 
reconciliation bill. Adopted 18 to 12.

------------------------------------------------------------------------
                                             Ayes      Nays     Present 
------------------------------------------------------------------------
Mr. Moorhead.............................        X   ........  .........
Mr. Sensenbrenner........................        X   ........  .........
Mr. McCollum.............................        X   ........  .........
Mr. Gekas................................        X   ........  .........
Mr. Coble................................        X   ........  .........
Mr. Smith (TX)...........................        X   ........  .........
Mr. Schiff...............................        X   ........  .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Canady...............................        X   ........  .........
Mr. Inglis...............................        X   ........  .........
Mr. Goodlatte............................        X   ........  .........
Mr. Buyer................................        X   ........  .........
Mr. Hoke.................................        X   ........  .........
Mr. Bono.................................        X   ........  .........
Mr. Heineman.............................        X   ........  .........
Mr. Bryant (TN)..........................  ........  ........  .........
Mr. Chabot...............................        X   ........  .........
Mr. Flanagan.............................        X   ........  .........
Mr. Barr.................................        X   ........  .........
Mr. Conyers..............................  ........        X   .........
Mrs. Schroeder...........................  ........        X   .........
Mr. Frank................................  ........        X   .........
Mr. Schumer..............................  ........  ........  .........
Mr. Berman...............................  ........        X   .........
Mr. Boucher..............................  ........        X   .........
Mr. Bryant (TX)..........................  ........        X   .........
Mr. Reed.................................  ........        X   .........
Mr. Nadler...............................  ........        X   .........
Mr. Scott................................  ........        X   .........
Mr. Watt.................................  ........        X   .........
Mr. Becerra..............................  ........  ........  .........
Mr. Serrano..............................  ........  ........  .........
Ms. Lofgren..............................  ........        X   .........
Ms. Jackson Lee..........................  ........        X   .........
Mr. Hyde, Chairman.......................        X   ........  .........
                                          ------------------------------
      Total..............................       18        12   .........
------------------------------------------------------------------------

               Congressional Budget Office Cost Estimate

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives, the committee sets 
forth, with respect to the proposed legislation set forth in 
the committee print, the following estimate and comparison 
prepared by the Director of the Congressional Budget Office 
under section 403 of the Congressional Budget Act of 1974:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 18, 1995.
Hon. Henry J. Hyde,
Chairman, Committee on the Judiciary,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the reconciliation 
recommendations of the House Committee on the Judiciary.
    The estimate shows the budgetary effects in 1996-2002 of 
the committee's legislative proposals. CBO understands that the 
Committee on the Budget will be responsible for interpreting 
how these proposals compare with the reconciliation 
instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted on November 15, 1995.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                         June E. O'Neill, Director.
    Enclosure.

               congressional budget office cost estimate

    1. Bill number: Not yet assigned.
    2. Bill title: Reconciliation Recommendations of the House 
Committee on the Judiciary.
    3. Bill status: As ordered reported by the House Committee 
on the Judiciary on September 12, 1995.
    4. Bill purpose: Title VII would extend through 2002 the 
surcharge on patent fees that was enacted in the Omnibus Budget 
Reconciliation Act of 1990 and extended by the Omnibus Budget 
Reconciliation Act of 1993. The 1990 act instructed the 
Commissioner on Patents and Trademarks to levy a surcharge on 
patent fees and to adjust them so as to collect amounts 
specified in the act. The surcharge receipts would continue to 
be deposited in a special fund in the U.S. Treasury as 
offsetting receipts, and would be available to the Patent and 
Trademark Office only to the extent provided in advance in 
appropriations acts.
    5. Estimated cost to the Federal Government: CBO estimates 
that enacting title VII would result in additional offsetting 
receipts of $238 million over the 1996-2000 period and $476 
million over the 1996-2002 period.

----------------------------------------------------------------------------------------------------------------
                                            1995     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
Spending under current law:                                                                                     
    Estimated budget authority..........     -107     -111     -115     -119  .......  .......  .......  .......
    Estimated outlays...................     -107     -111     -115     -119  .......  .......  .......  .......
Proposed changes:                                                                                               
    Estimated budget authority..........  .......  .......  .......  .......     -119     -119     -119     -119
    Estimated outlays...................  .......  .......  .......  .......     -119     -119     -119     -119
Projected spending:                                                                                             
    Estimated budget authority..........     -107     -111     -115     -119     -119     -119     -119     -119
    Estimated outlays...................     -107     -111     -115     -119     -119     -119     -119     -119
----------------------------------------------------------------------------------------------------------------

    The costs of this bill fall within budget function 370.
    6. Basis of estimate: The bill specifies that the 
Commissioner of the Patent and Trademark Office should revise 
the surcharges so as to ensure that the amount collected is 
$119 million in each of the fiscal years 1999-2002. This 
estimate assumes that those targets are attained.
    7. Estimated cost to State and local governments: None.
    8. Estimated comparison: None.
    9. Estimated CBO estimate: None.
    10. Estimated prepared by: Rachel Forward.
    11. Estimated approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Oversight Findings

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the committee reports 
that the findings and recommendations of the committee, based 
on oversight activities under clause 2(b)(1) of rule X of the 
Rules of the House of Representatives, are incorporated in the 
descriptive portions of this report.

         Committee on Government Reform and Oversight Findings

    No findings or recommendations of the Committee on 
Government Reform and Oversight were received as referred to in 
clause 2(l)(3)(D) of rule XI of the Rules of the House of 
Representatives.
      
               TITLE VIII--COMMITTEE ON NATIONAL SECURITY

                          House of Representatives,
                            Committee on National Security,
                                Washington, DC, September 26, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Mr. Chairman: The Committee on National Security 
convened on September 20, 1995, to recommend changes in 
mandatory spending and receipts to the Federal Treasury that 
would comply with the reconciliation instructions contained in 
House Concurrent Resolution 67, the concurrent resolution on 
the budget for fiscal year 1996. The recommendations were 
agreed to on a vote of 50-0. The recommendations adopted by the 
committee are provided in the enclosed package, which contains 
legislative language, report language, and a Congressional 
Budget Office cost estimate.
    The committee's effort to meet the reconciliation targets 
is prem- ised on three policy assumptions contained in this 
year's budget resolution: First, adjusting the payment dates of 
military retiree cost-of-living allowances to bring the payment 
dates into line with that of Federal civilian retirees; second, 
sale of all six sites that comprise the naval petroleum 
reserve; and third, providing for the sale of certain raw 
materials from the national defense stockpile.
    I believe the enclosed recommendations will meet or exceed 
the fiscal year 1996 budget reconciliation targets of the 
Committee on National Security.
    I appreciate your assistance and cooperation, and that of 
your staff, during the reconciliation process. I look forward 
to continuing our dialogue as the process moves forward.
    With warm personal regards, I am
            Sincerely,
                                           Floyd D. Spence,
                                                          Chairman.
    Attachments.

                           table of contents

                                                                   Page
Transmittal letter...............................................   535
Purpose and summary..............................................   536
Hearings.........................................................   536
Section-by-section explanation...................................   537
Changes in existing law..........................................   539
Rollcall votes...................................................   545
Congressional Budget Office estimate.............................   546
Committee oversight findings.....................................   551
Committee on Government Reform and Oversight findings............   551

                          Purpose and Summary

    House Concurrent Resolution 67, the concurrent resolution 
on the budget for fiscal year 1996, and House Report 104-159, 
the conference report accompanying House Concurrent Resolution 
67, contain budget reconciliation instructions for the 
Committee on National Security. These instructions seek to 
achieve mandatory spending targets deemed necessary in order to 
balance the Federal budget by the year 2002. Pursuant to those 
instructions, on September 20, 1995, the committee considered 
and now recommends implementing legislation designed to meet 
the spending targets contained in the budget resolution.
    The committee's effort to meet the reconciliation targets 
is premised on three policy assumptions: First, adjusting the 
payment dates of military retiree cost-of-living allowances 
[COLA's] to bring the payment dates into line with that of 
Federal civilian retirees; second, the sale by the end of 
fiscal year 1996 of all six sites that comprise the naval 
petroleum reserve [NPR]; and third, the sale by the end of 
fiscal year 1996 of certain raw materials from the national 
defense stockpile.
    The committee derives particular satisfaction from the 
provision that would adjust the date on which military retiree 
COLA's are paid to bring the date into conformity with the date 
on which Federal civilian retirees receive their COLA payments. 
Under current law, military retirees receive their COLA's later 
in the fiscal year than their Federal civilian counterparts. 
The committee's recommended provision would eliminate this 
inequity by extending the same treatment to both categories of 
retirees. Enactment of this provision into law would require an 
increase in mandatory spending authority of approximately $1.8 
billion over the next 7 years.
    The Congressional Budget Office estimates that the 
recommended sale of all six sites constituting the naval 
petroleum reserve would result in increased revenue to the 
Federal Treasury of $1.55 billion in fiscal year 1996. The 
committee recognizes that sale of the NPR is necessary to meet 
deficit reduction targets associated with balancing the Federal 
budget.
    Finally, the committee also recommends a provision that 
would provide new authorization for the Department of Defense 
to sell limited amounts of cobalt, aluminum, platinum, 
palladium, germanium, columbium ferro, and rubber from the 
national defense stockpile. The proceeds from the sale of these 
materials would be deposited into the general fund of the 
Treasury rather than into the stockpile transaction fund. $649 
million in mandatory savings is associated with this provision 
over the next 7 years. Once the revenues from the sale of these 
materials have been generated, the new authority would be 
terminated.

                                Hearings

    The Committee on National Security conducted no hearings 
with respect to budget reconciliation. However, on March 22, 
1995, the Subcommittee on Readiness held a hearing to consider 
the proposed sale of the naval petroleum reserves, and a 
provision to this effect is included in the committee's budget 
reconciliation recommendations.

                     Section-by-Section Explanation

                    Subtitle A--Military Retired Pay

Section 8001--Elimination of disparity between effective dates for 
        military and civilian retiree cost-of-living adjustments for 
        fiscal years 1996, 1997, and 1998

    This section would advance the month in which military 
retiree cost-of-living adjustments [COLA's] may be paid during 
fiscal years 1996, 1997, and 1998 from September during each of 
those years to March 1996, December 1996, and December 1997, 
respectively. This change corrects the disparity between 
military and Federal civilian retirees regarding eligibility 
for annual COLA's created by the 1993 Omnibus Budget 
Reconciliation Act [OBRA]. The concurrent resolution on the 
budget for fiscal year 1996 allocates a total of $1.8 billion 
to the military retirement trust fund during fiscal years 1996-
98 and relieves the Committee on National Security of the 
obligation to achieve the mandatory spending savings dictated 
in the 1993 OBRA.
    The concurrent resolution on the budget for fiscal year 
1994 proposed limits to civilian and military retirement 
COLA's. Imposition of these limits was projected to save $3.277 
billion during fiscal years 1994-98. The resolution limited 
COLA's for civilian and military retirees to one-half the rate 
of inflation for retirees under age 62, up to a maximum COLA in 
fiscal year 1994 of $400.
    Because 55 percent of the military retirees were under age 
62, as compared to only 15 percent of civilian retirees, the 
bulk of the required savings, $2.489 billion, fell to the 
Committees on Armed Services of the Senate and the House of 
Representatives, the committees with jurisdiction over the 
military retirement system. Federal civilian retirement 
programs were only required to save $788 million.
    The Committees on Armed Services of the Senate and the 
House of Representatives rejected the age-based COLA plan 
proposed in the 1994 budget resolution in favor of a rolling 
COLA that delayed COLA's for all retirees, except disabled 
retirees and survivor annuitants. Accordingly, the 1993 OBRA 
delayed the month for which COLA could be paid to military 
retirees from December of fiscal years 1994-98 to March 1994 
and September during each of the remaining years. The OBRA only 
delayed Federal civilian retirees' COLA's until March of fiscal 
years 1994-96.
    The National Defense Authorization Act for Fiscal Year 1995 
used discretionary operations and maintenance [O&M] funds to 
advance the first month in which military retirement COLA's 
could be paid from September to March 1995, the first month of 
COLA eligibility for Federal civilian retirees. The cost to 
move the COLA eligibility date for military retirees during 
fiscal year 1995 was $376 million. $403 million in 
discretionary operations and maintenance funding was included 
for the same purpose in the House-passed version of the 
national Defense authorization bill for fiscal year 1996, H.R. 
1530. The change adopted by the Committee on National Security 
pursuant to this year's reconciliation instructions would 
permanently correct the disparity in COLA payment dates for 
military and civilian retirees.

                  SUBTITLE B--Naval Petroleum Reserves

Section 8011--Sale of naval petroleum reserves

    H.R. 1530, the National Defense Authorization Act for 
Fiscal Year 1996, as passed by the House of Representatives, 
contains a provision that would require the sale of Naval 
Petroleum Reserve Numbered 1, Elk Hills, CA [Elk Hills]. H.R. 
1530 also would require a study of the other five reserves 
which comprise the naval petroleum reserve and a report to 
Congress by December 31, 1995 making recommendations for the 
most cost effective alternatives for disposing of these other 
reserves.
    In its reconciliation instructions to the committee, the 
Committee on the Budget recommended that all six of the naval 
petroleum reserves be sold during fiscal year 1996. According 
to estimates by the Congressional Budget Office [CBO], sale of 
the reserves would generate $1.55 billion in receipts to the 
Federal Government--$1.5 billion for Elk Hills and $50 million 
for the other five reserves.
    To meet the committee's direct spending targets provided in 
the concurrent resolution on the budget for fiscal year 1996, 
the committee recommends a provision, section 8011, that would 
require the sale of all of the reserves by the end of fiscal 
year 1996. The provision would require the Secretary of Energy 
to select independent experts in the valuation of oil and gas 
fields who would conduct separate assessments of the fair 
market value of the reserves. The secretary also would be 
required to retain the services of an investment banker to 
independently administer the sale of the reserves. These 
decisions would be made according to time lines specified in 
the provision.
    With respect to Elk Hills in particular, the provision 
would finalize the equity interests between the United States 
and Chevron Oil Co. In addition, the provision would resolve a 
disputed land claim by the State of California in the same 
manner as is provided for in H.R. 1530. Finally, the provision 
would provide procedural safeguards to ensure that the final 
sale price for the reserves reflects the true worth of the 
reserves.
    The committee is concerned that the reconciliation-imposed 
requirement to sell all the naval petroleum reserves within 1 
year may cause a delay in the sale of Elk Hills, the single 
most valuable reserve. The time lines imposed by section 8011 
in order to accomplish the sale are ambitious. Finally, the 
committee believes that the CBO estimate of $1.55 billion in 
receipts to the Federal Government that would be achieved by 
the sale may not be an accurate projection of the ultimate 
sales price for the reserves.

                 SUBTITLE C--National Defense Stockpile

Section 8021--Disposal of certain materials in national defense 
        stockpile for deficit reduction

    This section would provide new authorization for the 
Department of Defense to sell specified quantities of cobalt, 
aluminum, platinum, palladium, germanium, columbium ferro, and 
rubber from the national defense stockpile. The proceeds from 
the sale of these materials would be deposited into the general 
fund of the Treasury rather than into the stockpile transaction 
fund, as would be the case for other sales from the stockpile.
    The concurrent resolution on the budget for fiscal year 
1996 contained a policy assumption related to reform of the 
military retirement system to achieve savings in direct 
spending of $649 million through fiscal year 2002. Interim 
spending reduction targets of $21 million in fiscal year 1996 
and $338 million through fiscal year 2000 were also mandated. 
Rather than subject some uniformed personnel to a retroactive 
change to the military retirement system, the committee 
recommends a limited sale of select materials from the 
stockpile. Such sales would generate sufficient revenues to 
meet interim and overall spending targets and would avoid 
hardships for career military personnel that would have been 
caused by a change to the retired pay formula.
    In selecting the specific materials for disposal, the 
committee was careful to choose only those materials that are 
not critical to the Department of Defense and whose sale would 
have little or no impact upon domestic producers or users of 
the materials. Additionally, the authority to sell these 
materials would terminate once sufficient revenue is generated 
to meet the targets specified by the concurrent resolution on 
the budget.

    Changes in Existing Law Made by Title VIII the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italic, existing law in which no change is proposed 
is shown in roman):

                      TITLE 10, UNITED STATES CODE

          * * * * * * *

                    Subtitle A--General Military Law

          * * * * * * *

                           PART II--PERSONNEL

          * * * * * * *

                 CHAPTER 71--COMPUTATION OF RETIRED PAY

          * * * * * * *

Sec. 1401a. Adjustment of retired pay and retainer pay to reflect 
                    changes in Consumer Price Index

  (a)  * * *
  (b) Cost-of-Living Adjustments Based on CPI Increases.--
          (1)  * * *
          (2) Pre-august 1, 1986 members.--
                  (A) General rule.--The Secretary shall 
                increase the retired pay of each member and 
                former member who first became a member of a 
                uniformed service before August 1, 1986, by the 
                percent (adjusted to the nearest one-tenth of 1 
                percent) by which--
                          (i) the price index for the base 
                        quarter of that year, exceeds
                          (ii) the base index.
                  (B) Special rules for fiscal years 1994 
                [through 1998.--
                          [(i) Fiscal year 1994.--In the case 
                        of an increase in retired pay that, 
                        pursuant to paragraph (1), becomes 
                        effective on December 1, 1993, the 
                        initial month for which such increase 
                        is payable as part of such retired pay 
                        shall (notwithstanding such December 1 
                        effective date) be March 1994.
                          [(ii) Fiscal years 1995 through 
                        1998.--In the case of] through 1996.--
                        In the case of an increase in retired 
                        pay that, pursuant to paragraph (1), 
                        becomes effective on December 1 [of 
                        1994, 1995, 1996, or 1997] of 1993, 
                        1994, or 1995, the initial month for 
                        which such increase is payable as part 
                        of such retired pay shall 
                        (notwithstanding such December 1 
                        effective date) be [September] March of 
                        the following year.
                  (C) Inapplicability to disability retirees.--
                Subparagraph (B) does not apply with respect to 
                the retired pay of a member retired under 
                chapter 61 of this title.
          * * * * * * *

                   Subtitle C--Navy and Marine Corps

          * * * * * * *

                    PART IV--GENERAL ADMINISTRATION

          * * * * * * *

                 CHAPTER 641--NAVAL PETROLEUM RESERVES

Sec.
7420.  Definitions.
7421.  Jurisdiction and control.
7421a.  Sale of naval petroleum reserves.
          * * * * * * *

Sec. 7421a. Sale of naval petroleum reserves

  (a) Sale Required.--(1) Notwithstanding any other provision 
of this chapter, the Secretary shall sell all right, title, and 
interest of the United States in and to the lands owned or 
controlled by the United States inside the naval petroleum and 
oil shale reserves established by this chapter. In the case of 
Naval Petroleum Reserve Numbered 1, the lands to be sold shall 
include sections 16 and 36 of township 30 south, range 23 east, 
Mount Diablo Principal Meridian, California.
  (2) Not later than September 30, 1996, the Secretary shall 
enter into one or more contracts for the sale of all of the 
interest of the United States in the naval petroleum reserves.
  (b) Timing and Administration of Sale.--(1) Not later than 
January 1, 1996, the Secretary shall retain the services of 
five independent experts in the valuation of oil and gas fields 
to conduct separate assessments, in a manner consistent with 
commercial practices, of the fair market value of the interest 
of the United States in each naval petroleum reserve. In making 
their assessments for each naval petroleum reserve, the 
independent experts shall consider (among other factors) all 
equipment and facilities to be included in the sale, the net 
present value of the reserve, and the net present value of the 
anticipated revenue stream that the Secretary determines the 
Treasury would receive from the reserve if it were not sold, 
adjusted for any anticipated increases in tax revenues that 
would result if it were sold. The independent experts shall 
complete their assessments not later than June 1, 1996. In 
setting the minimum acceptable price for each naval petroleum 
reserve, the Secretary shall consider the average of the five 
assessments regarding the reserve or, if more advantageous to 
the Government, the average of three assessments after 
excluding the high and low assessments.
  (2) Not later than March 1, 1996, the Secretary shall retain 
the services of an investment banker to independently 
administer, in a manner consistent with commercial practices 
and in a manner that maximizes sale proceeds to the Government, 
the sale of the naval petroleum reserves under this section. 
The Secretary may enter into the contracts required under this 
paragraph and paragraph (1) on a noncompetitive basis.
  (3) Not later than June 1, 1996, the sales administrator 
selected under paragraph (2) shall complete a draft contract 
for the sale of each naval petroleum reserve, which shall 
accompany the invitation for bids and describe the terms and 
provisions of the sale of the interest of the United States in 
the reserve. Each draft contract shall identify all equipment 
and facilities to be included in the sales. Each draft 
contract, including the terms and provisions of the sale of the 
interest of the United States in the naval petroleum reserves, 
shall be subject to review and approval by the Secretary, the 
Secretary of the Treasury, and the Director of the Office of 
Management and Budget.
  (4) Not later than July 1, 1996, the Secretary shall publish 
an invitation for bids for the purchase of the naval petroleum 
reserves.
  (5) Not later than September 1, 1996, the Secretary shall 
accept the highest responsible offer for purchase of the 
interest of the United States in the naval petroleum reserves, 
or a particular reserve, that meets or exceeds the minimum 
acceptable price determined under paragraph (1). The Secretary 
may accept an offer for only a portion of a reserve so long as 
the entire reserve is still sold under this section at a price 
that meets or exceeds the minimum acceptable price.
  (c) Future Liabilities.--To effectuate the sale of the 
interest of the United States in a naval petroleum reserve, the 
Secretary may extend such indemnities and warranties as the 
Secretary considers reasonable and necessary to protect the 
purchaser from claims arising from the ownership in the reserve 
by the United States.
  (d) Special Rules Preparatory to Sale of Naval Petroleum 
Reserve Numbered 1.--(1) Not later than June 1, 1996, the 
Secretary shall finalize equity interests of the known oil and 
gas zones in Naval Petroleum Reserve Numbered 1 in the manner 
provided by this subsection.
  (2) The Secretary shall retain the services of an independent 
petroleum engineer, mutually acceptable to the equity owners, 
who shall prepare a recommendation on final equity figures. The 
Secretary may accept the recommendation of the independent 
petroleum engineer for final equity in each known oil and gas 
zone and establish final equity interest in the Naval Petroleum 
Reserve Numbered 1 in accordance with such recommendation, or 
the Secretary may use such other method to establish final 
equity interest in that reserve as the Secretary considers 
appropriate. The Secretary may enter into the contract required 
under this paragraph on a noncompetitive basis.
  (3) If, on the effective date of this section, there is an 
ongoing equity redetermination dispute between the equity 
owners under section 9(b) of the unit plan contract, such 
dispute shall be resolved in the manner provided in the unit 
plan contract not later than June 1, 1996. Such resolution 
shall be considered final for all purposes under this section.
  (4) In this section, the term ``unit plan contract'' means 
the unit plan contract between equity owners of the lands 
within the boundaries of Naval Petroleum Reserve Numbered 1 
(Elk Hills) entered into on June 19, 1944.
  (e) Production Allocation Regarding Naval Petroleum Reserve 
Numbered 1.--(1) As part of the contract for purchase of Naval 
Petroleum Reserve Numbered 1, the purchaser of the interest of 
the United States in that reserve shall agree to make up to 25 
percent of the purchaser's share of annual petroleum production 
from the purchased lands available for sale to small refiners, 
which do not have their own adequate sources of supply of 
petroleum, for processing or use only in their own refineries. 
None of the reserved production sold to small refiners may be 
resold in kind. The purchaser of that reserve may reduce the 
quantity of petroleum reserved under this subsection in the 
event of an insufficient number of qualified bids. The seller 
of this petroleum production has the right to refuse bids that 
are less than the prevailing market price of comparable oil.
  (2) The purchaser of Naval Petroleum Reserve Numbered 1 shall 
also agree to ensure that the terms of every sale of the 
purchaser's share of annual petroleum production from the 
purchased lands shall be so structured as to give full and 
equal opportunity for the acquisition of petroleum by all 
interested persons, including major and independent oil 
producers and refiners alike.
  (f) Maintaining Production Pending Sale of Naval Petroleum 
Reserve Numbered 1.--Until the sale of Naval Petroleum Reserve 
Numbered 1 is completed under this section, the Secretary shall 
continue to produce that reserve at the maximum daily oil or 
gas rate from a reservoir, which will permit maximum economic 
development of the reservoir consistent with sound oil field 
engineering practices in accordance with section 3 of the unit 
plan contract. The definition of maximum efficient rate in 
section 7420(6) of this title shall not apply to Naval 
Petroleum Reserve Numbered 1.
  (g) Effect on Existing Contracts.--(1) In the case of any 
contract, in effect on the effective date of this section, for 
the purchase of production from any part of the United States' 
share of the naval petroleum reserves, the sale of the interest 
of the United States in the reserves shall be subject to the 
contract for a period of three months after the closing date of 
the sale or until termination of the contract, whichever occurs 
first. The term of any contract entered into after the 
effective date of this section for the purchase of such 
production shall not exceed the anticipated closing date for 
the sale of the reserve.
  (2) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in 
the contract between the United States and Bechtel Petroleum 
Operation, Inc., Contract Number DE-ACO1-85FE60520 so that the 
contract terminates not later than the date of closing of the 
sale of that reserve.
  (3) In the case of Naval Petroleum Reserve Numbered 1, the 
Secretary shall exercise the termination procedures provided in 
the unit plan contract so that the unit plan contract 
terminates not later than the date of closing of the sale of 
that reserve.
  (h) Offer of Settlement of State of California Claims 
Regarding Naval Petroleum Reserve Numbered 1.--(1) In 
connection with the sale of Naval Petroleum Reserve Numbered 1, 
the Secretary shall offer to settle all claims against the 
United States by the State of California and the Teachers' 
Retirement Fund of the State of California with respect to 
lands within that reserve, including sections 16 and 36 of 
township 30 south, range 23 east, Mount Diablo Principal 
Meridian, California, or production or proceeds of sale from 
that reserve. Subject to paragraph (2), the Secretary shall 
offer in settlement of such claims--
          (A) a payment from funds provided for this purpose in 
        advance in appropriation Acts;
          (B) a grant of land pursuant to sections 2275 and 
        2276 of the Revised Statutes of the United States (43 
        U.S.C. 851 and 852) so long as such land is not 
        generating revenue for the United States;
          (C) any other option that would not be inconsistent 
        with the Congressional Budget Act of 1974 (2 U.S.C. 621 
        et seq.); or
          (D) any combination of subparagraphs (A), (B), and 
        (C).
  (2) The value of any payment, grant, or option (or 
combination thereof) offered as settlement under paragraph (1) 
may not exceed an amount equal to seven percent of the proceeds 
from the sale of Naval Petroleum Reserve Numbered 1, after 
deducting the costs incurred to conduct the sale of that 
reserve.
  (3) Acceptance of the settlement offered under paragraph (1) 
shall be subject to the condition that all claims against the 
United States by the State of California or the Teachers' 
Retirement Fund of the State of California are released with 
respect to lands within the Naval Petroleum Reserve Numbered 1, 
including sections 16 and 36 of township 30 south, range 23 
east, Mount Diablo Principal Meridian, California, or 
production or proceeds of sale from that reserve. The Secretary 
may specify the manner in which the release of such claims 
shall be evidenced.
  (i) Effect on Antitrust Laws.--Nothing in this section shall 
be construed to alter the application of the antitrust laws of 
the United States to the purchaser of a naval petroleum reserve 
or to the lands in the naval petroleum reserves subject to sale 
under this section upon the completion of the sale.
  (j) Preservation of Private Right, Title, and Interest.--
Nothing in this section shall be construed to adversely affect 
the ownership interest of any other entity having any right, 
title, and interest in and to lands within the boundaries of 
the naval petroleum reserves.
  (k) Congressional Notification.--Section 7431 of this title 
shall not apply to the sale of the naval petroleum reserves 
under this section. However, the Secretary may not enter into a 
contract for the sale of a naval petroleum reserve until the 
end of the 15-day period beginning on the date on which the 
Secretary notifies the Committee on Armed Services of the 
Senate and the Committee on National Security and the Committee 
on Commerce of the House of Representatives that the Secretary 
has accepted an offer under subsection (b)(5) for the sale of 
that reserve.
          * * * * * * *
                              ----------                              


             SECTION 8114A OF THE ACT OF SEPTEMBER 30, 1994

  AN ACT making appropriations for the Department of Defense for the 
     fiscal year ending September 30, 1995, and for other purposes.

  Sec. 8114A. (a)  * * *
  [(b) Future Cost-of-Living Adjustments for Military 
Retirees.--
          [(1) Subject to paragraph (2), subparagraph (B) of 
        section 1401a(b)(2) of title 10, United States Code, is 
        amended--
                  [(A) in the heading, by striking out 
                ``through 1998'' and inserting in lieu thereof 
                ``through 1996''; and
                  [(B) in clause (ii)--
                          [(i) by striking out ``through 1998'' 
                        and inserting in lieu thereof ``and 
                        1996'';
                          [(ii) by striking out ``of 1994, 
                        1995, 1996, or 1997'' and inserting in 
                        lieu thereof ``of 1994 or 1995''; and
                          [(iii) by striking out ``September'' 
                        and inserting in lieu thereof 
                        ``March''.
          [(2) Paragraph (1) shall be effective only if--
                  [(A) the President, in the budget of the 
                President for fiscal year 1996, proposes 
                legislation which if enacted would be 
                qualifying offsetting legislation; and
                  [(B) there is enacted during the first 
                session of the 104th Congress qualifying 
                offsetting legislation.
          [(3) If the conditions in paragraph (2) are met, then 
        the amendments by paragraph (1) shall take effect on 
        January 1, 1996.
          [(4) For purposes of this subsection:
                  [(A) The term ``qualifying offsetting 
                legislation'' means legislation (other than an 
                appropriations Act) that includes provisions 
                that--
                          [(i) offset fully the increased 
                        outlays for each of fiscal years 1996, 
                        1997, and 1998 to be made from the 
                        Department of Defense Military 
                        Retirement Fund by reason of the 
                        amendment made by paragraph (1);
                          [(ii) expressly state that they are 
                        enacted for the purpose of the offset 
                        described in clause (i); and
                          [(iii) are included in full on the 
                        PayGo scorecard.
                  [(B) The term ``PayGo scorecard'' means the 
                estimates that are made with respect to fiscal 
                years through fiscal year 1998 by the Director 
                of the Congressional Budget Office and the 
                Director of the Office of Management and Budget 
                under section 252(d) of the Balanced Budget and 
                Emergency Deficit Control Act of 1985.]

                             Rollcall Votes

    In accordance with clause 2(l)(2)(B) of rule XI of the 
Rules of the House of Representatives, one rollcall vote was 
taken in connection with the committee's consideration of 
reconciliation legislation. That vote is reflected below. The 
reconciliation implementing legislation attached hereto was 
ordered reported favorably to the Committee on the Budget, a 
quorum being present, by a vote of 50 to 0.

        COMMITTEE ON NATIONAL SECURITY--104TH CONGRESS ROLLCALL

    Final passage of budget reconciliation substitute. Date: 
September 20, 1995. Voice vote: Ayes, Nays.

------------------------------------------------------------------------
              Representative                  Aye       Nay     Present 
------------------------------------------------------------------------
Mr. Spence...............................        X   ........  .........
Mr. Stump................................        X   ........  .........
Mr. Hunter...............................        X   ........  .........
Mr. Kasich...............................  ........  ........  .........
Mr. Bateman..............................        X   ........  .........
Mr. Hansen...............................        X   ........  .........
Mr. Weldon...............................        X   ........  .........
Mr. Dornan...............................        X   ........  .........
Mr. Hefley...............................        X   ........  .........
Mr. Saxton...............................  ........  ........  .........
Mr. Cunningham...........................        X   ........  .........
Mr. Buyer................................        X   ........  .........
Mr. Torkildsen...........................        X   ........  .........
Mrs. Fowler..............................        X   ........  .........
Mr. McHugh...............................        X   ........  .........
Mr. Talent...............................        X   ........  .........
Mr. Everett..............................        X   ........  .........
Mr. Bartlett.............................        X   ........  .........
Mr. McKeon...............................        X   ........  .........
Mr. Lewis................................        X   ........  .........
Mr. Watts................................        X   ........  .........
Mr. Thornberry...........................        X   ........  .........
Mr. Hostettler...........................        X   ........  .........
Mr. Chambliss............................        X   ........  .........
Mr. Hilleary.............................        X   ........  .........
Mr. Scarborough..........................        X   ........  .........
Mr. Jones................................        X   ........  .........
Mr. Longley..............................        X   ........  .........
Mr. Tiahrt...............................        X   ........  .........
Mr. Hastings.............................        X   ........  .........
Mr. Dellums..............................        X   ........  .........
Mr. Montgomery...........................        X   ........  .........
Mrs. Schroeder...........................        X   ........  .........
Mr. Skelton..............................        X   ........  .........
Mr. Sisisky..............................  ........  ........     (\1\) 
Mr. Spratt...............................        X   ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................        X   ........  .........
Mr. Evans................................        X   ........  .........
Mr. Tanner...............................        X   ........  .........
Mr. Browder..............................        X   ........  .........
Mr. Taylor...............................        X   ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Edwards..............................        X   ........  .........
Mr. Tejeda...............................        X   ........  .........
Mr. Meehan...............................        X   ........  .........
Mr. Underwood............................        X   ........  .........
Ms. Harman...............................        X   ........  .........
Mr. McHale...............................        X   ........  .........
Mr. Geren................................        X   ........  .........
Mr. Peterson.............................        X   ........  .........
Mr. Jefferson............................  ........  ........  .........
Ms. DeLauro..............................        X   ........  .........
Mr. Ward.................................  ........  ........  .........
Mr. Kennedy..............................        X   ........  .........
                                          ------------------------------
      Total..............................       50   ........  .........
------------------------------------------------------------------------
\1\ A unanimous consent request by Mr. Dellums to indicate that Mr.     
  Sisisky was absent due to illness was agreed to by the full committee.

                  Congressional Budget Office Estimate

    In compliance with clause 2(l)(3)(C) of rule XI of Rules of 
the House of Representatives, the cost estimate prepared by the 
Congressional Budget Office and submitted pursuant to section 
403 of the Congressional Budget of 1974 is as follows:

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 26, 1995.
Hon. Floyd Spence,
Chairman, Committee on National Security,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the reconciliation 
recommendations approved by the House Committee on National 
Security on September 20, 1995.
    The estimate shows the budgetary effects of the proposals 
over the 1996-2002 period. CBO understands that the Committee 
on the Budget will be responsible for interpreting how these 
proposals compare with the reconciliation instructions in the 
budget resolution.
    This estimate assumes that the legislation will be enacted 
by November 15, 1995; the estimate could change if the bill is 
enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                             (For June E. O'Neill).
    Enclosure.

               congressional budget office cost estimate

    1. Bill number: Not yet assigned.
    2. Bill title: Title VIII, Reconciliation Recommendations 
of the House Committee on National Security.
    3. Bill status: As approved by the House Committee on 
National Security on September 20, 1995.
    4. Bill purpose: The legislation would advance military 
retirement cost-of-living adjustments [COLA's] and would 
require the administration to sell both the naval petroleum 
reserves and various materials in the national defense 
stockpile.
    5. Estimated cost to the Federal Government: Table 1 
summarizes the budgetary effects of the proposals. It shows the 
effects of the bill on direct spending, receipts from asset 
sales, and authorizations of appropriations for the 1996-2002 
period. Table 2 shows the budgetary impacts of advancing 
military retirement COLA's; table 3 details the effects of 
selling the naval petroleum reserves; and table 4 shows the 
increased receipts from the sale of materials contained in the 
national defense stockpile.
    6. Basis of estimate: This estimate assumes that the 
reconciliation bill will be enacted by November 15, 1995; the 
estimate could change if the bill is enacted later.
    Military Retirement Cost-of-Living Adjustments.--Military 
retirement annuities are adjusted to reflect increases in the 
Consumer Price Index [CPI]. The cost-of-living adjustment for 
nondisabled annuitants will appear in the checks paid in 
October for 1996-98 and in January thereafter. Subtitle A would 
provide the COLA for 1996 6 months sooner at a cost of $403 
million. In 1997 and 1998, the COLA would be paid 9 months 
sooner at a cost of $686 million and $716 million, 
respectively. The estimated costs are based on the budget 
resolution's assumptions for the CPI. COLA's for disabled 
retirees and survivor beneficiaries would not be affected by 
this provision.

     TABLE 1.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON NATIONAL SECURITY     
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                          1995     1996      1997      1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
Direct spending:                                                                                                
    Estimated budget authority........        0      403      1,037    1,186      445      424      401      379
    Estimated outlays.................        0      403      1,037    1,186      445      424      401      379
                                                                                                                
Receipts from asset sales (national                                                                             
 defense stockpile and naval petroleum                                                                          
 reserves):                                                                                                     
    Estimated budget authority........        0      -21     -1,629      -79      -79      -80     -155     -156
    Estimated outlays.................        0      -21     -1,629      -79      -79      -80     -155     -156
                                                                                                                
Spending subject to appropriations                                                                              
 action:                                                                                                        
    Estimated authorization level.....        0        6          0      105        0        0        0        0
    Estimated outlays.................        0        5          1      105        0        0        0        0
----------------------------------------------------------------------------------------------------------------
Note.--Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes
  of congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   
The direct spending in this bill falls under budget functions 270 and 600; receipts from asset sales fall under 
  budget functions 050 and 270.                                                                                 
The spending subject to appropriations action falls under budget function 270.                                  

    Naval Petroleum Reserves.--Subtitle B would require that 
the Department of Energy [DOE] sell all of the naval petroleum 
reserves [NPR] under certain conditions and procedures and 
would authorize various methods for settling certain claims 
related to Reserve 1 (Elk Hills).
    Under the provisions in this bill, the sale of the reserves 
would have three types of budgetary impacts over the 1996-2002 
period (see table 3). First, we estimate that selling all of 
the reserves would yield about $1.55 billion in nonroutine 
asset sale receipts, of which about $1.5 billion would be 
collected from the sale of Elk Hills and the remainder from the 
sale of reserves in Colorado, Wyoming, and Utah. We expect that 
the proceeds would be collected in fiscal year 1997, despite 
directives in the bill to complete the sales by the end of 
fiscal year 1996. CBO assumes that DOE is likely to need at 
least 1 year to complete the sale of Elk Hills in order to 
resolve various legal and technical issues and allow for 
competitive bidding, evaluation, and negotiation. Because of 
uncertainties regarding the other reserves, including the 
potential need for environmental assessments, we assume that 
such sales also would require 12 months or more to complete. 
Under this bill, the costs associated with administering the 
sales, which are estimated to total $6 million, would be 
deducted from the proceeds. We assume, however, that DOE would 
need to use appropriated funds in 1996 to pay for the services 
and activities specified in the bill. Hence, the table shows an 
estimated authorization for those administrative costs in 1996 
and outlays in 1996 and 1997.

                     TABLE 2.--DIRECT SPENDING FROM PROPOSALS AFFECTING MILITARY RETIREMENT                     
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                    1995      1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
Spending under current law:                                                                                     
    Estimated budget authority..    28,376    29,138    30,370    31,745    33,882    35,345    36,858    38,435
    Estimated outlays...........    28,350    29,039    30,261    31,630    33,762    35,219    36,727    38,298
Proposed changes:                                                                                               
    Estimated budget authority..         0       403       686       716         0         0         0         0
    Estimated outlays...........         0       403       686       716         0         0         0         0
Spending under proposals:                                                                                       
    Estimated budget authority..    28,376    29,541    31,056    32,461    33,882    35,345    36,858    38,435
    Estimated outlays...........    28,350    29,442    30,947    32,346    33,762    35,219    36,727    38,298
----------------------------------------------------------------------------------------------------------------

    Second, once the sales are completed, the Government would 
forgo the offsetting receipts that would otherwise have been 
collected from production and sale of oil, gas, and related 
products from the reserves. These receipts, which are included 
in budget function 270, are projected to total over $400 
million annually under current law over most of the 1997-2002 
period. Assuming that the sale would be completed during the 
first quarter of fiscal year 1997, we estimate that the loss of 
receipts from the sale of NPR would begin by the second quarter 
of the fiscal year. The loss would reach $470 million in 1998 
and decline gradually to $379 million in 2002.

                       TABLE 3.--BUDGETARY IMPACT OF SELLING THE NAVAL PETROLEUM RESERVES                       
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
               Category                   1995     1996      1997      1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
       RECEIPTS FROM ASSET SALE                                                                                 
                                                                                                                
Proceeds from the sale:                                                                                         
    Estimated budget authority........        0        0     -1,550        0        0        0        0        0
    Estimated outlays.................        0        0     -1,550        0        0        0        0        0
                                                                                                                
            DIRECT SPENDING                                                                                     
                                                                                                                
Receipts under current law:                                                                                     
    Estimated budget authority........     -433     -450       -477     -470     -445     -424     -401     -379
    Estimated outlays.................     -433     -450       -477     -470     -445     -424     -401     -379
Proposed changes:                                                                                               
    Estimated budget authority........        0        0        351      470      445      424      401      379
    Estimated outlays.................        0        0        351      470      445      424      401      379
Receipts under proposal:                                                                                        
    Estimated budget authority........     -433     -450       -126        0        0        0        0        0
    Estimated outlays.................     -433     -450       -126        0        0        0        0        0
                                                                                                                
  SPENDING SUBJECT TO APPROPRIATIONS                                                                            
                ACTION                                                                                          
                                                                                                                
Conduct of the sale:                                                                                            
    Authorization level...............        0        6          0        0        0        0        0        0
    Estimated outlays.................        0        5          1        0        0        0        0        0
Payment of possible claims: \1\                                                                                 
    Estimated authorization level.....        0        0  .........      105        0        0        0        0
    Estimated outlays.................        0        0          0      105        0        0        0        0
----------------------------------------------------------------------------------------------------------------
\1\ This authorization is contingent upon administrative and congressional actions that cannot be predicted by  
  CBO. However, it is unlikely that any appropriation or grant would occur before fiscal year 1998.             
Note.--Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes
  of congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   

    Third, the bill would authorize alternative methods of 
settling certain claims made by the State of California related 
to Elk Hills, including appropriations, a grant of nonrevenue 
producing lands, or any other arrangement consistent with the 
Congressional Budget Act. The value of such payments would be 
capped at 7 percent of the net proceeds from the sale of Elk 
Hills. With total proceeds from that sale project at $1.5 
billion, we estimate that this provision would authorize a 
payment or land grant valued at up to $105 million. Although we 
cannot predict what form such a settlement would take, we 
assume that any appropriation resulting from court rulings 
would be unlikley to occur before 1998.
    National Defense Stockpile Sales.--Subtitle C would require 
that the Department of Defense [DOD] sell certain materials in 
the national defense stockpile to achieve specified targets for 
cumulative receipts. Enough material would have to be sold to 
realize cumulative receipts of $21 million by September 30, 
1996; $338 million by September 30, 2000; and $649 million by 
September 30, 2002. The bill would prohibit sales after its 
receipt targets had been met.
    The receipts would come from selling aluminum, cobalt, 
ferrocolumbium, germanium, palladium, platinum, and rubber. The 
bill specifies the maximum quantity of each material that could 
be sold. Current law does not permit DOD to sell any of these 
materials except cobalt. The proposal would require DOD to sell 
all of the cobalt currently authorized for sale before selling 
additional materials to achieve the targets for receipts.
    To determine if the receipt targets could be achieved, CBO 
reviewed both past sales and historical trends in prices for 
the different materials. Using both historical average prices 
and quantities that would probably not cause any significant 
disruption in world markets, CBO found the receipt levels to be 
achievable. If DOD were unconstrained by the receipt targets 
and began selling all that the bill would allow, CBO estimates 
that receipts could total about $800 million for the 7-year 
period 1996-2002.

                         TABLE 4.--RECEIPTS FROM NATIONAL DEFENSE STOCKPILE ASSET SALES                         
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                            1995     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
Receipts under current laws:                                                                                    
    Estimated budget authority..........     -212     -202     -185     -185     -185     -185     -185     -185
    Estimated outlays...................     -212     -202     -185     -185     -185     -185     -185     -185
Proposed changes:                                                                                               
    Estimated budget authority..........        0      -21      -79      -79      -79      -80     -155     -156
    Estimated outlays...................        0      -21      -79      -79      -79      -80     -155     -156
Receipts under proposal:                                                                                        
    Estimated budget authority..........     -212     -223     -264     -264     -264     -265     -340     -341
    Estimated outlays...................     -212     -223     -264     -264     -264     -265     -340     -341
----------------------------------------------------------------------------------------------------------------
Note.--Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes
  of Congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   

    7. Estimated cost to State and local governments: Subtitle 
B would authorize alternative methods for settling certain 
claims by the State of California related to the Elk Hills 
reserve, including appropriations, land grants, or other 
arrangements. Our estimate suggests that the bill would 
authorize a settlement valued at up to $105 million, but that 
any appropriation or grant would be unlikely to occur before 
1998.
    8. Estimate comparison: None.
    9. Previous CBO estimate: On August 15, 1995, CBO prepared 
a cost estimate for the reconciliation recommendations of the 
House Committee on National Security, as ordered reported on 
August 1, 1995. Like the current bill, the previous version 
would advance the military retirement COLA dates and would sell 
the Naval Petroleum Reserves. This estimate and the earlier one 
are identical for these two provisions. The earlier 
recommendations would achieve cumulative savings of $644 
million by 2002 by changing the formula for computing 
retirement annuities. This bill would achieve cumulative 
savings of $649 million over the same period by selling 
materials in the national defense stockpile.
    On September 26, 1995, CBO prepared a cost estimate for the 
reconciliation recommendations of the Senate Committee on Armed 
Services, as ordered reported on September 18, 1995. Both bills 
would authorize the sale of the naval petroleum reserves, and 
the CBO estimates of this provision are identical. The bills 
would sell different materials from the national defense 
stockpile, but both would require sales totaling $649 million 
over the 1996-2002 period. Also, the Senate committee's version 
does not include language to advance the military retirement 
COLA dates, but the committee included such language in another 
bill, S. 1026.
    10. Estimate prepared by: Elizabeth Chambers prepared the 
estimates for changes to military retirement and sales from the 
national defense stockpile. The estimates for the sale of the 
naval petroleum reserves were prepared by Kathy Gramp.
    11. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Oversight Findings

    With reference to clause 2(l)(3)(A) of rule XI of the Rules 
of the House of Representatives, this legislation results from 
hearings and other oversight activities conducted by the 
committee pursuant to clause 2(b)(1) of rule X.
    With respect to clause 2(l)(3)(B) of rule XI of the Rules 
of the House of Representatives, this legislation does not 
include any new budget, spending, or credit authority, nor does 
it provide for any increase or decrease in tax revenues or 
expenditures.

         Committee on Government Reform and Oversight Findings

    With respect to clause 2(l)(3)(D) of rule XI of the Rules 
of the House of Representatives, the committee has not received 
a report from the Committee on Government Reform and Oversight 
pertaining to budget reconciliation.
      
                    TITLE IX--COMMITTEE ON RESOURCES

                          House of Representatives,
                                    Committee on Resources,
                                Washington, DC, September 29, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Mr. Chairman: In accordance with your September 19, 
1995, letter to me, I am transmitting with this letter the 
reconciliation provisions adopted by the Committee on Resources 
on September 19, 1995. As requested, I have included materials 
outlining the purpose background on the provisions, the history 
of any committee action, a section-by-section analysis, 
committee oversight findings, a Ramseyer, and tally sheets for 
all rollcall votes in committee. All but the last two items are 
also contained on the enclosed computer disk. I am also 
enclosing some dissenting and additional views filed by 
minority members of the committee.
    I have not yet received a letter from the Congressional 
Budget Office estimating the cost savings and revenue generated 
by our provisions, but based on informal estimates, the 
Committee on Resources has clearly met our budget targets. I 
will forward this letter to you as soon as I receive it.
    I am proud of the Committee on Resources' contribution to 
balancing our Federal budget and reducing the Federal deficit. 
I look forward to the consideration of these measures by the 
House of Representatives and wish you every success with the 
reconciliation bill.
            Sincerely,
                                                 Don Young,
                                                          Chairman.

                           table of contents

                                                                   Page
Transmittal letter...............................................   553
Introduction.....................................................   553
Background and need for legislation..............................   554
Committee action.................................................   577
Section-by-section analysis......................................   586
Changes in existing law..........................................   636
Vote of the committee............................................   695
Congressional Budget Office estimate.............................   708
Committee oversight findings.....................................   726
Committee on Government Reform and Oversight findings............   726

                              Introduction

    The committee print adopted by the Committee on Resources 
on September 19, 1995, which will comprise title IX in the 
larger reconciliation measure assembled by the Committee on 
Budget, generates revenues or increases savings to the Federal 
Government of $100 million in fiscal year 1996 and $2.3 billion 
by fiscal year 2002. The committee print reflects dual goals in 
meeting a balanced budget. First, the print is about achieving 
less Federal Government involvement in peoples' lives through 
the termination of Federal programs that can be appropriately 
done by non-Federal entities. In this category are the sales of 
two power marketing administrations, the sale of Federal helium 
stockpiles, the termination of a special grant to the Northern 
Mariana Islands, and direction to the Department of the 
Interior to contract out for mapping and charting activities. 
Second, the print is about reform, including improvements in 
existing Federal mining laws, concession policies, livestock 
grazing, and the oil and gas leasing process.
    As follows are background and need explanations for the 
provisions of the committee print, a summary of committee 
action on the print (including any earlier action on underlying 
legislation), and a section-by-section analysis of the print. 
Also included are dissenting and additional views filed by 
minority members of the committee.

                  Background and Need for Legislation

              SUBTITLE A--ALASKA AND HELIUM PRIVATIZATION

                             Part 1--Alaska

Sec. 9001. Exports of Alaska North Slope Oil

    In 1973, contemporaneously with the Arab-Israeli war and 
the first oil embargo, Congress adopted the Trans-Alaska 
Pipeline Authorization Act, which authorized construction of a 
pipeline to move the oil from Alaska's North Slope to an 
accessible port at Valdez, AK. The legislation also established 
export restrictions on all domestically produced crude oil 
carried over a Federal right-of-way by adding a new section 
28(u) to the Mineral Leasing Act [MLA]. As amended, the MLA 
permitted exports of domestically produced crude oil--including 
Alaskan North Slope [ANS] crude oil--only if the President 
determined the exports would be in the national interest, it 
would not diminish the total quality or quantity of petroleum 
available to the United States, and it would be done in 
accordance with licensing provisions of the Export 
Administration Act of 1969.
    In 1979, following the second major oil shock, Congress 
effectively banned exports of ANS crude oil. Today, ANS crude 
oil is the only domestically produced crude oil subject to an 
export ban. As a result, Alaska--the largest oil producing 
State in the Nation--is the only State subject to an export 
ban.
    The world oil situation has changed fundamentally since the 
1970's when the United States faced continuing supply threats. 
In 1973, for example, Middle East countries boycotted the 
United States at the outbreak of the war. Thereafter, OPEC was 
able to ratchet up prices repeatedly, as demand for oil seemed 
essentially inelastic and energy demand appeared to be growing 
geometrically. The enormously flexible U.S. economy, however, 
reacted to the anticipated shortage through rapid gains in 
energy efficiency. Net imports of oil actually declined between 
1978 and 1993. Not until last year did imports surpass the 
previous all-time high, principally as a result of falling 
domestic oil production.
    At the same time that demand pressure moderated, world 
crude oil supplies greatly expanded and diversified. The United 
States established a Strategic Petroleum Reserve, which today 
contains nearly 600 million barrels of crude. Moreover, a 
pronounced shift toward more reliable sources of supply 
occurred. The United States, for example, no longer imports any 
crude oil from Iran, Iraq, or Libya. Today, Canada and Mexico 
are among our largest suppliers. In short, the United States no 
longer faces the supply threats that it faced in the 1970's.
    Today, approximately 1.6 million barrels of crude oil are 
carried daily through the Trans-Alaska Pipeline System. The 
majority of the oil is carried by tanker to the west coast and 
Hawaii. With the ban in place, the surplus must be delivered to 
the Gulf Coast, the Midwest, and the Virgin Islands. The added 
cost of moving the oil this considerable distance reduces the 
netback to producers in Alaska. The export ban also creates a 
glut on the west coast market, depressing the price of ANS 
crude and heavy oil produced in California. Although not 
intended, the export restrictions have actually reduced 
domestic production by discouraging production in Alaska and 
California.
    North slope production has now entered a period of 
sustained decline. As a result, many of the tankers built at 
considerable expense to carry the oil to market are laid up or 
headed for the scrap heap. With increased production in Alaska 
and California, these militarily useful tankers would have new 
employment opportunities, as would the skilled mariners who man 
the vessels. Moreover, shipbuilding and ship repair yards on 
the west coast would have new business opportunities.
    In an effort to ascertain whether authorizing ANS exports 
would be in the national interest and to quantify the benefits 
(as well as possible costs) of lifting the ban, the Department 
of Energy conducted, in June 1994, a comprehensive study and 
issued a report. In ``Exporting Alaskan North Slope Crude Oil--
Benefits and Costs,'' the Department concluded that ``there 
would be a significant number of benefits from allowing the 
export of ANS crude.'' By the end of the decade, those benefits 
would include: Increasing domestic oil production by up to 
110,000 barrels per day, creating up to 25,000 oil industry 
related jobs, preserving as many as 3,300 direct and indirect 
maritime jobs, and raising approximately $2 billion in Federal 
and State revenues. The Department concluded that ``[l]ittle, 
if any, increase in consumer petroleum prices would be likely'' 
and stated that ``[n]o significantly negative environmental 
implications were found.'' The Department specifically found 
that ``[l]ifting the ban will reduce overall tanker movements 
in U.S. waters.'' The Department, however, did find that 
independent refiners on the west coast were expected to incur 
slightly higher crude oil acquisition costs as the west coast 
surplus eased.
    The committee concurs with the Department's findings with 
respect to west coast refiners. These refiners often purchase 
ANS crude on the spot market, below world market prices, at as 
much as a $3 per barrel discount but do not pass the savings on 
to consumers. The committee, therefore, feels that west coast 
refiners should incur higher crude oil acquisition costs.
    In the view of the committee, the ban no longer makes 
sense. By authorizing exports, Congress could spur domestic 
energy production, create or preserve jobs, help maintain an 
independent tanker fleet essential to national defense, raise 
State and Federal revenues, and reduce our Nation's net 
dependence on imports. The committee believes exports of ANS 
crude are in the national interest. The committee therefore 
urges the President to make the required findings and his 
national interest determination as quickly as possible 
following enactment of the legislation.

Sec. 9002. Arctic Coastal Plain leasing and revenue

    Section 9002 contains the recommendations of the committee 
with respect to reducing the Federal deficit by allowing 
competitive bonus bids for oil and gas leases in the coastal 
plain area of the Arctic National Wildlife Refuge [ANWR] in 
Alaska.
    The committee recognizes that opening the small coastal 
plain area of ANWR's 19 million acres is and has been 
controversial since the late 1970's. The coastal plain was an 
issue in the years of debate that preceded enactment of the 
Alaska National Interest Lands Conservation Act of 1980 
[ANILCA]. Senator Henry M. Jackson (D-WA) and many other 
Members of both parties in the House and Senate strongly 
believed that the 1.5 million acre coastal plain area 
constituted the Nation's best prospect for one or more Middle 
East or Prudhoe Bay class oil discoveries. They believed that 
this area, adjacent to Prudhoe Bay, should be leased for oil 
and gas exploration and development under sound and responsible 
environmental regulations. Other Members of Congress, including 
Representative Morris K. Udall, wanted the coastal plain's 1.5 
million acres included in what subsequently became an 8 million 
acre wilderness designation in ANILCA. This designation doubled 
the Arctic National Wildlife Refuge to 19 million acres--an 
area the size of the State of South Carolina.
    None of these advocates achieved complete victory. The 
adoption of ANILCA in 1980 was based upon a coastal plain 
compromise. This compromise agreement required a 5-year study 
by the Department of the Interior of the energy and wilderness 
values of the coastal plain area. This 5-year Federal study was 
finally completed and released in April 1987. The study was 
both a comprehensive resource assessment and a final 
legislative environmental impact statement. The conclusions of 
the report and the subsequent recommendations of the Secretary 
of the Interior were very clear. The more than 6 years of 
intensive study led the Secretary to conclude that: First, Oil 
and gas resources of the coastal plain can be fully developed 
without harm to coastal plain wildlife, the environment or 
subsistence uses by native people; and second, oil and gas 
leasing and development on the coastal plain would best serve 
the interests of the Nation by providing jobs (estimated by 
various sources at anywhere from 250,000 to 735,000), 
stimulating the economy, reducing oil import dependence, 
improving the Nation's balance of payments, enhancing national 
security, generating substantial new Federal revenues from 
bonus bids and taxes, and providing domestic energy companies 
an alternative to investing in foreign prospects (which export 
both jobs and scarce investment capital).
    The committee recognizes that, to date, the Clinton 
administration has opposed legislation to open the 1.5 million 
acre coastal plain. This position was reiterated when the 
Solicitor of the Department of the Interior, Mr. John Leshy, 
testified before the Resources Committee on August 1, 1995. 
Also, in recent months the administration has directed the U.S. 
Geological Survey and other resource agencies of the Department 
of the Interior to revisit the subject of opening the coastal 
plain. This has included requests or directives to undertake a 
reexamination of the 1987 Report, as well as the more than 6 
years of careful study and review by agencies of the Department 
of the Interior that lead up to that report. This action by the 
Clinton administration has led to the preparation of recent 
papers and assessments by the Department which seek to raise 
new issues or questions which might undercut some aspects of 
the 1987 report which support oil and gas leasing.
    The committee respects the right of the Clinton 
administration to recommend policy positions on the coastal 
plain and other matters. The committee, however, has an 
obligation to independently weigh the facts, to evaluate the 
evidence, and to address the needs of the Nation, as well as to 
respond to the fiscal crisis and the growing budget and trade 
deficits facing the country. The committee has done so in this 
legislation. Section 9002 incorporates the clear evidence from 
the hearing record, the weight of scientific opinion, and the 
economic needs of the country. This subsection also reflects a 
new and growing majority view in this nation that we must 
address the facts about our energy resource base, our need for 
petroleum, and our fiscal deficit.
    In short, section 9002 represents the committee's best 
judgment on how to eliminate the budget deficit; how to create 
hundreds of thousands of new jobs in all 50 States; how to 
bring domestic oil company investments home; how to reduce the 
trade deficit; how to expand and utilize the best and cleanest 
technology in the world for Arctic oil development; how to 
raise a minimum of $1.3 billion in new Federal revenues: and 
how to develop the new natural gas resources that our nation 
will need in the future.
    The committee is confident that the public will respect our 
analysis and our conclusions, based on the facts, on this 
important matter. The committee is prepared to continue to work 
with the administration in adjusting to the new budget reality 
and all it entails. It is essential to find new sources of 
revenue that will provide options for down-sizing and narrowing 
the focus of government. New revenues can provide the means for 
new programs which can achieve shared objectives. 
Unfortunately, critics of Coastal Plain development have yet to 
suggest any credible alternative source of new revenues if the 
Coastal Plain were to remain closed to leasing.

Sec. 9003. Alaska Power Administration sale

    The Federal Government markets power from its 129 
hydroelectric projects throughout the United States through 
five Power Marketing Administrations [PMA's]. These multi-
purpose projects, constructed and owned by the Department of 
the Interior's Bureau of Reclamation and the U.S. Army Corps of 
Engineers for flood control, navigation, irrigation and more 
recently, for recreational purposes, generate 45 percent of the 
nation's hydroelectric power as a by-product, which is sold by 
the PMA's to local public, private and cooperative utilities at 
cost. Supplemental power from these projects is provided to all 
but 16 States.
    Unique among the PMA's, the Alaska Power Administration 
[APA] owns, operates and maintains two hydroelectric projects, 
Eklutna and Snettisham. Not only are these two projects 
confined to local Alaska markets, but, unlike the other PMA's, 
the APA's single-purpose projects are not the result of a water 
resource management plan nor are they intended to remain 
indefinitely under Federal control. Instead, they were created 
to encourage and promote economic development and to foster the 
establishment of essential industries in Alaska by providing 
and encouraging the most widespread use of hydroelectric power 
at the lowest possible rates. It was for these purposes, rather 
than flood control, navigation, irrigation or recreation, that 
the 30 megawatt [MW] Eklutna project was built in 1955 to serve 
the Anchorage and Matanuska Valley areas, and the 78MW 
Snettisham project was constructed to serve Juneau in 1975.
    To date, the two projects have served their original 
purposes well. Findings indicate that not only have they 
provided widespread, relatively low-cost, long-term supplies of 
renewable energy to the areas served and recovered the Federal 
costs as intended in the authorizing legislation, but also 
economic and industrial development has occurred to the point 
where their role in the State as major providers of electric 
power has greatly diminished. Together, these projects provide 
only about 8 percent of the total energy requirements of 
Alaska's electric utilities.
    The time for the Federal Government's divestiture of these 
projects is ripe, since the goals as originally intended have 
been met. It is no longer necessary for the Federal Government 
to operate a small, separate power program in Alaska because: 
(1) the projects fill a small market niche; (2) economic and 
industrial development of the regions served has evolved as 
planned; (3) other providers have emerged that can provide and 
serve the region's needs; and, (4) the State and local electric 
utilities are poised to manage the projects in a manner 
consistent with Alaska's future energy and development needs.
    Although informal discussions of divestiture date back many 
years, it was not until 1986 that the formal proposal first 
appeared. Subsequent to this, a public comment process resulted 
in invitations of proposals to purchase the projects being 
extended in the spring of 1987 to electric utilities served by 
the APA projects. In response to solicitation requests, the 
State of Alaska proposed to purchase the Snettisham project, 
while three utilities, the city of Anchorage, the Matanuska 
Electric Association and the Chugach Electric Association, 
submitted a joint proposal to purchase Eklutna. Finding both 
perspective purchasers well qualified to own, operate and 
maintain the projects, the APA moved forward to draft purchase 
agreements.
    The APA and the proposing parties negotiated purchase 
agreements which set forth the terms, conditions and 
responsibilities of each party for the orderly sale and 
transfer of the projects. The final agreements, signed in 1989, 
have been amended twice to extend the purchase deadline. They 
reflect great care and deliberation to incorporate and address, 
to the extent possible, all views and concerns of interested 
parties to ensure a balance between Federal taxpayers, Federal 
agencies affected, State and local utilities, and retail 
customers. As a result, the divestiture proposal has widespread 
support.
    This section and separate formal agreements provide for the 
full protection of fish and wildlife. The purchasers, the State 
of Alaska, the U.S. Department of Commerce, National Marine 
Fisheries Service and the U.S. Department of Interior have 
entered into a formal agreement providing for post-sale 
protection, mitigation and enhancement of fish and wildlife 
resources affected by Eklutna and Snettisham. This section 
makes that agreement legally enforceable.
    The Federal Government will be relieved of the 
responsibility of owning and operating two small, isolated 
hydroelectric projects in Alaska and any liabilities for future 
maintenance, equipment replacement, and claims. Equally 
important, proceeds from the sale will recover nearly 95 
percent of the present value of the original Federal investment 
in the APA projects and prescribed interest (estimated between 
$73.5 and 80.3 million, depending on certain conditions when 
the sale is approved), and foregone annual revenues of 
approximately $10 million will be nearly off-set by the 
avoidance of annual expenditures averaging $4 million for 
management and operations, and $6 million in principal and 
interest on the outstanding debt on these two projects:
    The APA has 34 employees located in Alaska. The purchasers 
of the two projects have pledged to hire as many of these 
people as possible. For those who do not receive offers of 
employment, the Department of Energy [DOE] has pledged that it 
will offer employment to any remaining APA employees, although 
DOE jobs are expected to be in the lower-48 States.
    In designing a ``break even'' or ``cost recovery'' sale of 
these two projects, the Federal Government meets two goals: 
first, it optimizes on the taxpayers' interests by recovering 
nearly all of the original investment; and second, it addresses 
the consumers' concerns that hydroelectric power continue to be 
provided without a significant increase in rates.

                      Part 2--Helium Privatization

Secs. 9011-9018. The Helium Privatization Act

    Helium has unique properties that make it useful for 
science and industry. It is used in cancer research, to cool 
nuclear reactors, and by the National Aeronautics and Space 
Administration [NASA] for its shuttle launches. In 1925, the 
Federal helium program was officially placed under the control 
of the Bureau of Mines [BOM] when Congress enacted the Helium 
Act of 1925. In 1929, BOM's large scale helium extraction and 
purification facility was built and began operating near 
Amarillo, TX. Concerns that natural gas supplies were tapering 
off prompted Congress to replace the 1925 Act with the Helium 
Act Amendments of 1960. The 1960 Act was intended to conserve 
helium for essential Federal Government services and to supply 
current and foreseeable needs of the Federal Government. The 
law authorized the purchase of helium from private suppliers 
and its storage for later use by the Federal Government. Also, 
the law authorized the maintenance of helium production and 
purification plants and related helium transmission and 
shipping facilities.
    Beginning in 1960, the Federal Government contracted with 
private companies to supply helium to the BOM facility. To 
finance purchases BOM borrowed $252 million from the Treasury, 
intending that future sales would repay the loan. But Federal 
demand failed to meet projections, and in 1973, contracts for 
additional helium were canceled. Regardless, BOM has amassed an 
estimated 31.4 billion cubic feet helium stockpile and a debt, 
which today is estimated at $1.4 billion (including interest). 
The repayment of this debt is a central issue in determining 
when the stockpile should be sold.
    The Federal helium program serves the needs of ``major'' 
Federal users of helium, such as NASA (where helium is used in 
leak detection and purging of rocket fuel tanks) and the 
Department of Energy laboratories (where it is used in liquid 
form as a supercoolant). Under current law these Federal 
agencies and their contractors must purchase helium from BOM's 
Cliffside facility. Sales to private users are allowed but have 
declined to only a few percent of total sales since BOM raised 
its prices administratively in 1991.
    The helium program has been attacked as unnecessary and as 
a drain on the Treasury by watchdog groups such as the National 
Taxpayers Union, the 20/20 television program, NBC Nightly 
News, the Inspector General of the Department of the Interior 
and the Heritage Foundation. While the helium program was 
created at a time when there was no private helium production, 
today the private sector produces 90 percent of the world's 
helium. Private industry's production ability is a primary 
reason the above cited groups have called for eliminating the 
Federal program.
    Subtitle A, Part 2 address the three central objectives 
sought by those who have called for abolition of the program: 
getting the Federal Government out of the helium business; 
repaying the Federal debt by selling the facility and 
stockpile; and avoiding disruption of the private helium 
industry.

                      SUBTITLE B--WATER AND POWER

                Part 1--Power Marketing Administrations

Secs. 9201-9204. The Power Administration Act

    There are five Federal Power Marketing Administrations 
[PMA's]: Alaska Power Administration [APA], Southeastern Power 
Administration [SEPA], Southwestern Power Administration 
[SWPA], Western Area Power Administration [WAPA], and 
Bonneville Power Administration [BPA].
    The APA is sold and transferred under section 9002 of the 
committee print.
    The PMA's are agencies within the Department of Energy with 
the primary mission to market the electrical power generated at 
Federal dams. The power is typically sold to publicly or 
cooperatively-owned utilities (frequently called preference 
customers). The PMA's sell about 6 percent of the nation's 
total electricity generation to these preference customers. 
Government-owned utilities serve approximately 14 percent of 
all electric consumers, while rural electric cooperatives serve 
about 11 percent of electric consumers.
    The PMA's are facing a number of operational challenges, 
including: a drain on revenues for other public purposes, 
particularly Endangered Species Act compliance; increased 
competition in the wholesale power market as a result of the 
National Energy Policy Act of 1992; deferred maintenance on 
powerplants by the operating agencies; and reoperation of dams 
for environmental purposes.
    In recent years, the PMA's have attracted the interest of 
those concerned with balancing the Federal budget, because the 
possible sale of the PMA's would: First, end Federal funding 
for the construction, operation and maintenance of the PMA 
system; second, result in an infusion of proceeds that could be 
used to reduce the Federal deficit; third, increase the 
efficiencies of operation on the systems; and fourth, reverse 
the growing backlog of deferred maintenance at the projects. 
Given the Nation's continuing budget crisis, the committee 
believes that SEPA should be privatized and that DOE should 
also begin evaluating the possible sale of the SWPA- and WAPA-
related assets.
    On May 3, 1995, the administration transmitted to Congress 
its legislative proposal to sell SEPA, SWPA and WAPA. The 
proposal would authorize the Secretary of Energy to study and 
prepare plans to sell the three agencies. Following 
Presidential approval of the sale plan, the Secretary would 
transmit the plan to Congress to take effect in 60 days. The 
administration's proposal would give a preferential right of 
purchase to the existing firm power customers. The legislation 
was never introduced.
    The transfer of the PMA's will affect a mature private/
public competitive electric supply and distribution system in 
the U.S. That system has grown up over the past 50 years, with 
about 80 percent of the electricity generated by investor owned 
utilities [IOU's] and about 20 percent by the public sector 
power systems. In rural areas of America, about 60 percent of 
the electric needs are met by IOU's, with the remainder served 
by the rural cooperatives and other public power systems.
    In the early 1900's, when privately owned utilities served 
primarily the large urban markets, Congress authorized and 
appropriated funds that would allow municipalities and rural 
cooperatives to build electric utility systems to meet their 
needs. Now, approximately 99 percent of America has electrical 
service.
    The Federal Energy Regulatory Commission [FERC] regulates 
the wholesale power rates of the IOUs and the availability of 
access to the transmission systems. As FERC continues to make 
the electric utility business more competitive, it is taking 
steps to let public and private providers compete directly for 
each other's customers.
            Southeastern Power Administration
    SEPA markets power generated at Federal hydroelectric 
generating plants in 10 Southeastern States--Virginia, West 
Virginia, North Carolina, South Carolina, Georgia, Florida, 
Alabama, Mississippi, Tennessee, and Kentucky. Power is sold to 
customers in 11 States--those listed above plus Illinois. There 
are presently 23 SEPA-related projects in operation. SEPA 
purchases, transmits, and markets power from these projects 
within four separate SEPA power systems: Georgia, Alabama, 
South Carolina, Jim Woodruff, Cumberland and Kerr-Philpott. 
SEPA sells this power at wholesale primarily to publicly and 
cooperatively-owned electric distribution utilities using 
wheeling and pooling agreements with the region's large private 
utilities to provide power to its customers. SEPA does not own 
or operate any electric transmission facilities.
    SEPA's operations have been affected in recent years by 
problems associated with deferred maintenance on powerplants, 
resulting in supply problems at times. One of the driving 
forces requiring this legislation is that the Federal 
Government has invested millions of dollars in these Federal 
assets but is no longer adequately maintaining them.
            Southwestern Power Administration
    SWPA's primary mission is to market surplus federally-
generated hydroelectric power in a six-State region. SWPA 
operates and maintains 1,380 miles of high-voltage transmission 
line and 24 substations in that region. Its headquarters is 
located in Tulsa, OK; the dispatch center is in Springfield, 
MO; and maintenance centers are based in Jonesboro, AR; Gore 
and Tupelo, OK; and Springfield, MO.
            Western Area Power Administration
    WAPA was formed when the Department of Energy was created 
in 1977, and it took over power marketing functions from the 
Department of the Interior. WAPA markets power throughout a 1.3 
million-square-mile geographic area in 15 Central and Western 
States to 637 wholesale customers. In fiscal year 1996, WAPA 
will operate and maintain 16,734 miles of high-voltage 
transmission line, 259 substations, and other associated power 
facilities. WAPA markets power generated at 55 powerplants, and 
also purchases power to firm up the Federal hydropower 
supplies.
    WAPA is facing several issues, including: the reoperation 
of the Glen Canyon Dam, which reduces its usefulness as a 
peaking power facility; rewinds at the powerplant at Shasta Dam 
in Northern California; significant cost overruns of the Hoover 
Dam Visitors' Facility, which becomes part of the rate base for 
certain customers; and a return of drought conditions in 1994 
that affected the amount of water available for generation of 
electricity. WAPA is also facing issues relating to Endangered 
Species Act--listed species in the Sacramento River and the 
Upper Colorado River basins.

Sec. 9205. Bonneville Power Administration appropriations refinancing

    The Bonneville Power Administration [BPA] was created by 
the 1937 Bonneville Project Act to market power from Federal 
projects in the Pacific Northwest. BPA currently markets power 
from 30 Federal hydroelectric projects, most of which are 
located in the Columbia River basin. BPA also markets 
electricity from several non-Federal projects, including the 
Washington Public Power Supply System, Project No. 2 (a nuclear 
powerplant).
    On the transmission side of its business, BPA owns and 
operates approximately 18,000 miles of high voltage 
transmission line and 388 substations comprising approximately 
80 percent of the bulk transmission capacity of the Pacific 
Northwest. BPA sells and exchanges power under contracts with 
over 140 utilities in the Pacific Northwest and the Pacific 
Southwest and with seven large industrial customers. BPA 
estimates that its service area of nearly 300,000 square miles 
has a population of approximately nine million people.
    Since 1974, BPA's operations have been financed through a 
revolving fund--power revenues are deposited into this fund and 
are then available for BPA to spend. BPA also uses permanently 
authorized borrowing authority, now totaling $3.75 billion, to 
finance capital investments. Under provisions of the Energy 
Policy Act of 1992, BPA has the authority to fund directly 
certain powerplant upgrades and rewinds at Federal hydropower 
facilities.
    For years, several administrations have threatened to 
change fundamentally the terms upon which BPA satisfies its 
obligation to return the taxpayers' investment in the Federal 
Columbia River Power System [FCRPS]. These proposals had 
varying approaches, but in general would have increased 
substantially the returns to the Treasury. Faced with these 
annual proposals, BPA's customers are concerned that steeply 
increased returns to the Treasury may be forced on them. The 
purpose of this section is to assure power purchasers that BPA 
will not be forced to raise its rates to non-competitive levels 
to satisfy possible future changes in law or practice relating 
to the requirements under which BPA presently repays the 
Federal capital investment in the FCRPS funded by 
appropriations. In exchange for providing enhanced certainty in 
the terms of BPA's repayment responsibilities, the U.S. 
Treasury will realize additional returns from BPA's ratepayers 
because section 9205 increases BPA's payments in respect of the 
investments by a net present value of $100 million.
    The essential terms of the transaction authorized by 
section 9205 are:
          BPA refinances with the U.S. Treasury its unpaid 
        appropriated debt, raising the interest rates and 
        thereby eliminating the low interest rates which have 
        fueled previous debates about whether repayment reform 
        should be implemented.
          BPA pays over time $100 million at today's value as 
        the cost of refinancing.
          In return, BPA customers get a contractual guarantee 
        that further increases in repayment of the refinanced 
        debt will not be implemented.
    The net impact of this section is to cause an approximate 
$15 million increase in BPA debt service requirements in the 
first several years. This increases to $25 million after 5 
years and then declines at a generally steady rate over the 
next 15 years until the increase in cost disappears. According 
to BPA, the need to raise an additional $25 million in revenues 
creates a BPA rate impact of slightly more than 1 percent.
    It should also be noted that this section provides for 
credits against amounts otherwise payable by the BPA 
Administrator to the U.S. Treasury for a portion of the funds 
the Administrator is obligated to pay the tribes under the 
Colville Settlement Agreement, enacted last year as Public Law 
103-436. These credits are designed to provide near-term rate 
stability for the ratepayers.

                          Part 2--Reclamation

Sec. 9211. Prepayment of certain repayment contracts between the United 
        States and the Central Utah Water Conservancy District

    This section requires the Secretary of the Interior to 
accept prepayment from the Central Utah Water Conservancy 
District [District] for debt associated with a contract 
governing repayment of municipal and industrial water delivery 
facilities of the Central Utah Project. These facilities, when 
completed, will provide municipal and industrial water to parts 
of the State of Utah. The largest facility expected to be 
prepaid is the Jordanelle Dam, upon which construction activity 
has been completed. The Jordanelle Reservoir is presently 
filling with water pursuant to a filling criteria schedule for 
new dams developed by the Bureau of Reclamation, an agency of 
the Department of the Interior. The committee expects that in 
1996, Jordanelle Reservoir will be filled with sufficient water 
to initiate repayment by the District. Once the District's 
repayment obligation is triggered, the District is expected to 
exercise its option to prepay its repayment debt. In addition, 
construction funding for the Diamond Fork pipeline is expected 
to be provided in the fiscal year 1996 Energy and Water 
Development Appropriations bill, which will initiate 
construction of this facility. The committee is confident that 
this facility will be completed and prepaid under this section 
within 7 years from the date of enactment of this section.
    Based upon information from the financial advisors of the 
District, the committee expects that prepayments by the 
District to the U.S. Treasury pursuant to this section will 
occur as follows: $20 million to $25 million in fiscal year 
1996; $100 million to $125 million in fiscal year 1998; and $25 
million to $50 million in fiscal year 2001.

Sec. 9212. Treatment of city of Folsom as a Central Valley project 
        contractor

    This section is designed to facilitate efforts by the city 
of Folsom, California, to contract with the Placer County Water 
Agency under the terms of the Central Valley Project 
Improvement Act (CVPIA, title XXXIV of Public Law 102-575) to 
obtain a portion of the Water Agency's unused CVP water 
allocation. The city does not have such a contract at this 
time.
    Section 206 of Public Law 101-514 authorized the Secretary 
of the Interior to enter into a contract with the Sacramento 
Water Agency for municipal and industrial water supply, 7,000 
acre-feet of which has been allocated to the city of Folsom. 
However, those contract negotiations are still underway, and 
are not expected to be completed for another 2 to 3 years. Once 
completed, the city of Folsom will still have an inadequate 
water supply.
    Therefore, the city is seeking to enter into a water 
transfer agreement to help meet its needs. Provisions of CVPIA 
expedite transfers between ``Central Valley Project 
contractors'' within counties, watersheds or other areas of 
origin. Since the city is authorized to received water under 
Public Law 101-514, which was approved on November 11, 1990, 
the city is seeking to be considered a CVP contractor as of 
that date. This will facilitate entering into a water transfer 
with Placer County Water Agency.

Sec. 9213. Sly Park

    The Sly Park Unit of the Central Valley Project [CVP] is 
located on Sly Park Creek upstream of Sacramento, CA. 
Constructed during the 1950's, the project facilities consist 
of the Sly Park Dam and Reservoir, the Camp Creek Diversion Dam 
and Tunnel, and various other water distribution features. The 
Sly Park facilities furnish municipal and industrial water to 
Placerville and other towns, and irrigation water to the El 
Dorado Irrigation District. The Unit has been operated by the 
El Dorado Irrigation District since construction was completed 
in 1956.
    The Sly Park Unit is financially integrated with the CVP, 
but is hydrologically independent. The Irrigation District is 
interested in acquiring title to the dam and main supply works 
to exercise greater control over its water supplies.

Sec. 9214. Hetch Hetchy Dam

    Section 9214 would increase from $30,000 to $8 million the 
annual payment made by the city of San Francisco under the 
provisions of the Raker Act (Act of December 13, 1913) for 
having the Hetch Hetchy system within Yosemite National Park.
    The section further stipulates that these receipts shall be 
placed in a separate fund by the United States. The fund would 
be subject to further appropriations, but the highest priority 
for use of the funds is for the annual operation of Yosemite 
National Park, with the remainder of any funds to be used to 
fund operations of other national parks in California.
    The current $30,000 payment was set in statute in 1913, and 
has not been changed or indexed for inflation since then. An 
effort was made to increase the fee to $20 million annually 
during the 1993 reconciliation debate, but it was defeated. 
There was a recognition at the time, however, that the fee was 
too low and that this issue needed to be addressed.
    While the committee does not have the most current revenues 
and expenditures by the city of San Francisco with respect to 
the Hetch Hetchy system, a February 1988 report by the Bureau 
of Reclamation indicated that the net book value of the Hetch 
Hetchy system as of June 30, 1987, was about $272.8 million, 
and the remaining balance to be repaid on the facilities 
totaled $3.4 million. During the 6-year period between fiscal 
years 1982-1987, average annual water and power revenues 
totaled $87.7 million, with average annual operational expenses 
of $49.1 million. During this period, the average annual net 
revenues generated totaled $38.7 million.

         SUBTITLE C--NATIONAL PARKS, FORESTS, AND PUBLIC LANDS

                       Part 1--Concession Reform

Secs. 9301-9318. Visitor Facilities and Services Enhancement Act of 
        1995

    Concession operations on Federal lands are big business. In 
1993, the General Accounting Office reported that more than 
9,000 concessioners had gross revenues of over $2 billion. 
These concessions range from huge operations at Yosemite 
National Park which offer food and lodging, and ski areas at 
Vail and Aspen, to small outfitter and guide services who only 
take a few hunting trips a year. Concessions are currently 
managed by each Federal agency under widely varying laws and 
rules.
    Concession management on Federal lands, in particular 
National Park Service [NPS] lands, has received considerable 
attention over the years. The law governing concession 
management on NPS lands has been under attack for over 20 
years. The two primary features of that law which have been 
constantly criticized are the lack of any viable competition 
and the manner in which capital improvements are treated. 
Current law provides for existing concessioners to have a 
preferential right of renewal in all contracts, which means 
they are afforded the opportunity to meet any other offers. The 
law also provides for concessioners to obtain a possessory 
interest in any improvements they construct.
    There has also been criticism about the rate of return to 
the Federal Government for concession activities. The rate of 
return for NPS contracts, 2.4 percent of gross revenues, is 
similar to the rate of return for concessions on a government-
wide basis. However, the rate of return is more an artifact of 
the inability of the government to negotiate a good deal than 
it has been a result of the law.
    The purpose of these sections is to reform the manner in 
which concessions are managed by six Federal land management 
agencies to improve service to the public. Concessioners would 
be selected through an open and competitive process which would 
ensure a fair return to the Federal Government.

                   Part 2--National Forest Ski Areas

Secs. 9321-9322. Privatization of Forest Service ski areas; ski area 
        permit fees and withdrawal of ski areas from operation of 
        mining laws

    Currently, 140 ski area operators lease a total of 182,000 
acres of National Forest Service lands (about 0.1 percent of 
all Forest Service land). The lease terms are for 30 or 40 
years and are automatically renewable. In 1994, the ski areas 
paid $19 million in permits fees, or 2 percent of their gross 
receipts of $939 million.
    The Forest Service uses the Graduated Rate Fee System to 
determine the fees to be charged. This system is costly for the 
Forest Service to administer and requires the ski operators to 
keep a separate set of books. The Forest Service was directed 
in 1986 to develop a permit fee system which would provide a 
fair market return, but has been unable to make any progress in 
that effort. The new fee system in this part is designed to be 
revenue neutral, while simplifying the fee collection system 
for the Forest Service and the ski area operators.
    The purpose of this part is to reform the manner in which 
the Forest Service collects fees from ski area permit holders 
and to authorize the sale of certain ski areas on Forest 
Service lands.

                   Part 3--Domestic Livestock Grazing

Secs. 9331-9336. Domestic livestock grazing

    The regulations and laws governing grazing on Bureau of 
Land Management [BLM] land prior to the implementation of 
Secretary of the Interior Bruce Babbitt's ``Rangeland Reform 
1994'' regulations would be codified as amended by the changes 
contained in this part. This would put in place long standing 
regulations as in effect on January 1, 1995, and prevent the 
costly implementation of new regulations associated with 
``Rangeland Reform 1994.''
    Current regulations governing grazing on lands administered 
by the Forest Service are substantially different from those 
governing lands administered by the BLM. This part would 
prospectively change the law to require that the Forest Service 
regulations substantially mirror those of the BLM. Cost savings 
would occur for both Federal agencies as well as the permittees 
who are now faced with two sets of separate and distinct 
regulations.
    This part would also establish a gross return fee formula 
based on a 3-year rolling average of the gross value of 
production of livestock, as determined by the Economic Research 
Service, multiplied by the 10-year average of the U.S. Treasury 
Securities 6-month Treasury Bill ``new issue'' rate and divided 
by 12. Using this formula, the grazing fee per animal unit 
month [AUM] for 1993 would be $2.15. The fee under current law 
is set at $1.61. Thus, the new fee is a 33 percent increase 
over current law. The Congressional Budget Office has scored 
the new fee as raising $30 million over 5 years, of which $9 
million goes to the States and $21 million to the U.S. 
Treasury. This is an attempt to implement a fee that more 
fairly reflects market rates for forage.
    Under existing law, BLM allows for subleasing without a 
surcharge when approved by BLM. This part requires a subleasing 
charge equal to 25 percent of the difference between the 
current year's Federal grazing fee and the prior year's private 
grazing land lease rate per year of the appropriate State. This 
applies to livestock not owned by a permittee's spouse, son, 
daughter, grandson, or granddaughter. This is meant as a 
deterrent to subleasing as well as a means of raising revenues.
    For calculation of the Federal grazing fee, current law 
defines one animal unit month [AUM] as one cow, bull, steer, 
heifer, horse, burro, mule, or five sheep or goats. The bill 
amends this definition only by changing five sheep or goats to 
seven sheep or goats to more realistically reflect the forage 
consumed by sheep and goats.
    Current law establishes permit tenure at 10 years. This 
part amends this period to 15 years to provide greater 
stability to the livestock community.
    Finally, this part provides relief to the current problem 
of reissuing expiring grazing permits for ranchers in good 
standing. It amends current law to state that the issuance of a 
grazing permit and other livestock grazing activity and 
management actions with a valid land use plan under the 
National Environmental Protection Act [NEPA] are ongoing 
government action that do not require further NEPA 
documentation. This solves an ongoing concern by Federal 
agencies over whether they must comply with NEPA when issuing 
grazing permits and for other minor livestock grazing 
activities and management actions. Significant cost savings 
will be realized as the Federal agencies are not required to 
conduct an involved NEPA analysis on individual grazing 
permits.

     Part 4--Regional Disposal Facility of Southwestern Low Level 
                   Radioactive Waste Disposal Compact

Secs. 9341-9342. Conveyance of property; conveyance of easements

    The Low Level Waste Policy Act Amendments of 1985 made low 
level radioactive waste disposal a State responsibility and 
encouraged the formation of interstate compacts to provide for 
regional disposal. The State of California joined with Arizona, 
North Dakota and South Dakota to form the Southwestern compact 
for low level waste disposal. Ward Valley, located 22 miles 
west of Needles, CA, is the selected site for this compact. The 
public need for the Ward Valley facility is compelling because 
no disposal alternatives exist in the compact States for the 
biotech companies, hospitals, labs, universities, and medical 
centers that produce the low level waste. As a result, the 
waste is being stored on site at thousands of facilities 
throughout California and the other compact States, posing a 
potential danger in the event of a disaster. Following 8 years 
of technical evaluation and analysis, and the expenditure of 
$45 million by a private licensee designated by the State, the 
California Department of Health Services issued a license for 
the Ward Valley facility site in 1993. The licensing process 
followed an extensive national sitting process which involved 
significant public input. A final environmental impact 
statement and a biological opinion regarding the desert 
tortoise have been completed.
    The selected site is on BLM held land, thus necessitating a 
land transfer from BLM to the California Department of Health 
Services. Despite the State's license approval, the Secretary 
of the Interior refused to transfer the land until a National 
Academy of Science [NAS] study was completed and a report 
issued on the theory of potential groundwater contamination by 
the proposed facility. The NAS issued its report May 11, 1995, 
and concluded that groundwater contamination ``is highly 
unlikely.''
    Despite the NAS findings, the Secretary did not transfer 
the land. Instead, he sought an agreement with the State of 
California that would provide the department with an oversight 
role of the facility and would impose additional compliance 
terms and conditions on the State. Extensive discussions 
between the department and the State failed to produce an 
agreement. Governor Wilson has requested that Congress act to 
transfer the land. The committee believes that such action is 
appropriate in light of what has become an never-ending 
dispute--in which it had been clear to the committee for some 
time that all outstanding reasonable issues have been resolved.

                        SUBTITLE D--TERRITORIES

          Part 1--Commonwealth of the Northern Mariana Islands

Sec. 9401. Termination of annual direct grant assistance

    The Northern Mariana Islands [NMI], previously part of the 
United States administered Trust Territory of the Pacific 
Islands and now a U.S. territory, have received a generous 
stream of special annual grants from the Federal Government 
since the NMI chose to come under U.S. sovereignty. The special 
grant authorization is contained in the law approving the 
Covenant which provided the framework for the current Federal-
territorial relationship. It appears the grants have produced 
the intended results as the Marianas now enjoys one of the 
highest standards of living in the Pacific.
    NMI's Gov. Froilan Tenorio testified before the 
Subcommittee on Native American and Insular Affairs on January 
31, 1995, that the NMI no longer needs the funds and asked 
Congress to eliminate the special annual grant. He stated ``The 
time must come to end the annual Federal payment to the 
Northern Mariana Islands. The Federal Government is not helping 
us by giving us this money.''
    The $27.72 million annual funding would terminate effective 
October 1, 1995, and result in savings of $194 million over 7 
years. This cessation of the grant would not affect the full 
spectrum of Federal funding currently received by the NMI. 
Moreover, the NMI still has yet to expend over $80 million in 
accumulated special annual grant funds from current and prior 
years.

            Part 2--Territorial Administrative Cessation Act

Sec. 9421-9424. The Territorial Administrative Cessation Act

    Mr. Gallegly introduced legislation in the 103d Congress to 
end the administration of territories from the Department of 
the Interior. This mirrored an earlier precedent involving the 
unincorporated territory of Puerto Rico. In 1961, Puerto Rico 
ceased to be administered by the Department of the Interior, 
having achieved a significant level of self-governance. The 
other territories of American Samoa, Guam, the Northern Mariana 
Islands, and the Virgin Islands have also developed similar 
levels of local self-governance. There has been a general 
consensus for some time that the United States should terminate 
the direct administration of territories.
    In January 1995, the administration finally agreed to end 
the administration of territories by announcing the closure of 
the Office of Territorial and International Affairs [OTIA]. 
Although the action was claimed to be a major example of 
reinventing government and cutting Federal costs, the 
administration's proposal would save a meager $1 million per 
year. In stark contrast, this part would statutorily eliminate 
OTIA, the position of an associated assistant secretary, and 
related technical assistance programs managed by that office, 
and realize savings of nearly $120 million over 7 years.
    In support of this effort, Gov. Roy L. Schneider of the 
Virgin Islands testified before the Subcommittee on Native 
American and Insular Affairs that ``[a]bolishing the office may 
save the Federal Government money and it will not harm the 
territories.''
    This is a new era for the territories. It's time to 
recognize their ability to govern themselves and end the old 
way of directing the territories by bureaucrats in Washington.

                          SUBTITLE E--MINERALS

                        Part 1--Hardrock Mining

Secs. 9501-9505. Hardrock mining

    Mining is a key basic industry. The industry produces 
metals and minerals which are essential for agriculture, 
construction and manufacturing. In the latter case, a recent 
study by the National Research Council concluded that one of 
the primary advantages that the United States possesses over 
its strongest industrial competitors, Japan and Western Europe, 
is its domestic resource base.
    Evidence is mounting that while global mineral exploration 
trends are strongly positive, U.S. mineral exploration has 
entered a protracted downward spiral. For example, the number 
of active Federal mining claims has fallen by two-thirds since 
1989 and a recent survey of North American precious metal 
producers showed that North American mining companies are 
spending 61 percent of their exploration and development moneys 
outside the United States compared to spending about 80 percent 
of these monies within the United States in 1988. Continuation 
of present domestic mineral exploration trends will eventually 
result in the significant loss of domestic mineral production 
and thousands of high-paying, skilled jobs in the mining and 
mineral processing industries, and increased reliance on 
foreign mineral supplies which will aggravate the Nation's 
trade deficit.
    Most mining observers believe that the current trend in 
U.S. exploration and development expenditures is due to growing 
uncertainty over doing business in the United States--not 
because all of the large mineral deposits have been discovered. 
A major cause of this growing uncertainty is the long-
simmering, unresolved controversy over the mining law.
    The amendments to the mining law proposed in this part 
provide a balanced approach which will provide a stable 
business climate conducive to mining investment while raising 
new revenues to help balance the budget and narrow the deficit. 
These amendments will impose a 3.5 percent net proceeds royalty 
on hardrock mining on Federal lands as well as reasonable fees 
on mining claims and will raise millions of dollars in Federal 
revenues. An annual labor credit against claim maintenance fees 
will encourage exploration on Federal lands and help reverse 
the present downward trend in domestic exploration 
expenditures.
    This part also changes the current patenting charges by 
requiring that miners pay fair market value for the surface of 
the land they use for mining. The current charges for patenting 
are probably the most controversial issue in the contentious 
mining law debate. Location and patenting of deposits of 
mineral materials as defined in the Surface Resources Act of 
1955 is also ended. The ``uncommonness'' determination is 
burdensome and costly to the government and claimants alike. 
The Materials Act of 1947 is amended to allow for long-term 
leasing of mineral materials deposits.
    Threatened action by the Secretary of the Interior to 
dramatically raise royalty rates on sodium leases within the 
Green River basin of Wyoming prompted the provision to limit 
secretarial discretion under the Mineral Leasing Act of 1920 to 
set these royalty terms. Domestic production of soda ash is 
dominated by natural soda ash produced from the mineral trona. 
U.S. producers are able to compete worldwide against synthetic 
soda ash producers because of the cost advantages of converting 
trona to soda ash. The export market is very important in the 
rising demand for soda ash. The committee is concerned about 
the complex effect of royalty rates increases on net receipts 
to the Treasury, yet the Secretary is not even considering this 
impact while studying the issue. Meanwhile, no new tracts have 
been posted for lease for over a decade yet abundant evidence 
suggests the new leases could be let and production expanded if 
a stable reasonable royalty environment is imposed. 
Accordingly, significant bonus bid and production royalty 
revenues have been denied both the Federal and State treasury 
by the Secretary's inaction.

                 Part 2--Federal Oil and Gas Royalties

Secs. 9511-9526. The Federal Oil and Gas Royalty Simplification and 
        Fairness Act of 1995

    The existing oil and gas mineral leasing laws, regulations, 
policies and procedures related to obligations arising from 
leases administered by the Secretary of the Interior are 
lacking in clarity, consistency, and reciprocity, and contain 
inequities which impose unnecessary and unreasonable costs and 
burdens on lessees and the Federal Government. The Federal 
Royalty Program is overly complex, burdensome, and unfair for 
oil and gas companies who seek to do business with the 
Department of the Interior for both onshore and offshore 
leases. Currently, multiple conflicting statutes of limitation 
and recent court decisions have created uncertainty and 
unfairness for companies subject to indefinite audit 
collection. For example, the courts in Phillips v. Babbitt, No. 
93-1377 (5th Cir., Sept. 7, 1994) and IPAA v. Samedan (D.C. 
Dist., May 1995), held no statute of limitations applies. These 
cases as well as numerous other recent court decisions compel 
enactment of this legislation.
    Specifically, this part establishes a clear, certain, and 
reciprocal period of limitation for the bringing of judicial 
and administrative proceedings; conforms the recordkeeping 
requirement to the period of limitation; and establishes a 3-
year time limitation in which the Secretary must issue a final 
agency action in any appeal or administrative proceeding 
pending within the Department of Interior.
    In addition, current law restricts a lessee's access to an 
overpayment made to the Federal Government and does not provide 
for the time value of money, is inequitable and encourages 
underpayments. Therefore, this part makes clear and certain the 
rights of the Secretary, the United States and lessees with 
regard to the right to refund of overpayments made to the 
United States, and the payment of interest on such 
overpayments.
    Simplification and streamlining recommendations have been 
made to the Secretary of the Interior regarding the Minerals 
Management Service's Royalty Management Program in the past, 
and numerous studies have been conducted reviewing various 
aspects of the program. Yet meaningful and timely reform has 
not been achieved. The committee intends that the Secretary 
implement congressionally mandated reform to simplify and 
streamline the royalty reporting and collection processes 
thereby collecting royalty obligations sooner. To this end, 
this part implements and maintains an effective and efficient 
management program for leases administered by the Secretary; 
streamlines administrative procedures and processes; and 
reduces the administrative costs and paperwork burdens of the 
Secretary and lessees.
    The overall purpose of this part is to establish and 
enforce a clear, certain and equitable mineral leasing laws for 
the effective and efficient administration of leases by the 
Secretary of the Interior allowing exploration and development 
of oil and gas resources on Federal lands and the Outer 
Continental Shelf. This part in no way affects Indian lands or 
alters how the Federal Oil and Gas Royalty Management Act of 
1982 applies to Indian lands.
    This legislation is prospective only and accomplishes 
across-the-board fairness for all matters related to the 
payment of Federal oil and gas royalties, resulting in a 
simpler and more cost-effective way to conduct royalty 
business. Under this part, there will be no reduction in 
royalty obligation. This part will also promote increased 
development on Federal lands and ensure that the Secretary has 
the necessary enforcement tools for proper collection of 
royalties.

                       SUBTITLE F--INDIAN GAMING

                         Part 1--Indian Gaming

Sec. 9601. Indian gaming

    The National Indian Gaming Commission is authorized, 
pursuant to Public Law 100-497, to collect up to $1,500,000 
annually in fees from certain Indian gaming activities to be 
used to fund the Commission's operations. In addition, there 
are authorized to be appropriated by Congress such sums as may 
be necessary for the operation of the Commission.
    In years past and proposed for fiscal year 1996, Congress 
has appropriated an annual amount of $1 million to the 
Commission. This section would increase the authority of the 
Commission to impose fees by $1 million and would terminate the 
authority of Congress to appropriate funding for the 
Commission.

                    Part 2--Indian Health: Medicaid

                    Part 3--Indian Health: Medicare

Secs. 9611-9622. Health care facilities; provider reimbursement; study; 
        health care facilities; provider reimbursement

    This part would not increase Federal spending. Instead it 
will ensure that tribal health programs will continue to be 
able to treat Indians who are Medicaid or Medicare eligible 
when new State plans are created as a result of reforms 
currently proposed by Congress.
    In particular, this part is intended: First, to ensure that 
Indian Health Service and tribal health programs that currently 
participate in the Medicaid and Medicare programs will continue 
to be eligible providers under any new State plans created as a 
result of Medicaid and Medicare reform;
    Second, to ensure that all Medicaid-eligible Indians will 
still have the ability to receive care from a State plan 
provider under any new State plan created pursuant to proposed 
Medicaid reform legislation;
    Third, to ensure that a private health care provider which 
provides services to Medicaid-eligible Indians is not denied 
payment by the State on the grounds that the State is the payor 
of last resort and the provider should first seek reimbursement 
from the Indian Health Service (IHS);
    Fourth, to ensure that tribes are consulted in the 
development of State plan standards under Medicaid reform;
    Fifth, to require the Secretary of Health and Human 
Services to carefully study the effects of Medicaid reform on 
Indians and Indian tribes, and report to Congress as to whether 
the effects are good or bad and what can be done to improve 
Medicaid for Indians; and
    Sixth, to allow tribally operated health programs which own 
their own facilities to participate in the Medicare and 
Medicaid programs. The Indian Health Care Improvement Act 
contains an unintended loophole which only allows Indian Health 
Service and tribal programs which operate out of IHS-owned 
facilities to participate in these programs.

                        SUBTITLE G--CONSULTATION

Sec. 9701. Consultation

    The Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.) 
requires that every Federal agency shall consult with the 
Secretary of the Interior to ensure that any action authorized, 
funded, or carried out by that agency is not likely to 
jeopardize the continued existence of any endangered species or 
threatened species or result in the adverse modification of 
critical habitat of that species. After the consultation 
process is initiated and before the Secretary issues his 
opinion, neither the Federal agency or any permit or license 
applicant may make any irreversible or irretrievable commitment 
of resources regarding the proposed action that might foreclose 
the formulation of any reasonable and prudent alternative to 
the action that would not otherwise jeopardize the continued 
existence of the species. A number of lawsuits have resulted in 
which injunctions have been issued to stop projects from moving 
forward where consultation on the project has been completed, 
but where the court has ordered consultation on related 
underlying programmatic documents which authorized those types 
of projects. This section is needed to make clear the intent of 
Congress that the prohibition on the irreversible or 
irretrievable commitment of resources is limited to particular 
projects or site specific activities.

                          SUBTITLE H--MAPPING

Secs. 9801-9806. Department of the Interior Surveying and Mapping 
        Efficiency and Economic Opportunity Act of 1995

    In the Department of the Interior, there are 1827 employees 
engaged in surveying and mapping (as of September 30, 1994), 
according to data from the Office of Personnel Management. An 
Office of Management and Budget [OMB] survey (OMB Bulletin 93-
14) estimated $761.7 million in budget authority in the 
Interior Department for geographic data activities 
(acquisition, management, and dissemination) in fiscal year 
1993, and estimated the President's fiscal year 1994 budget 
request at $801.5 million. In fiscal year 1994, only 212 
service contracts for geographic data activities totaling just 
$18.4 million were awarded to the private sector.
    There is a capable and qualified private sector of more 
than 250 mapping firms and 6,000 surveying firms in the United 
States. The Interior mapping establishment duplicates the 
capabilities of the commercial, private sector. Moreover, not 
only do Federal agencies not contract a significant amount of 
their own work, but many agencies do work for other Federal 
agencies, as well as State, local, and foreign governments, in 
direct competition with the private sector.
    For more than 20 years, numerous government studies have 
concluded that more contracting should be used in Federal 
surveying and mapping activities. In 1973 the Office of 
Management and Budget report of its Task Force on Mapping, 
Charting, Geodesy, and Surveying concluded, ``private 
cartographic contract capability is not being used 
sufficiently. We found this capacity to be broad and varied and 
capable of rendering skilled support * * * Contract capability 
is a viable management alternative * * * Its use should be 
encouraged in lieu of continued in-house build-up.''
    A Bureau of Land Management report, ``Managing Our Land 
Information Resources, 1989,'' found ``[t]he private sector can 
play an important role in providing BLM with the massive 
amounts of data it requires for its three LIS [land information 
systems] components. BLM can avoid investing in necessary labor 
and technology by drawing on the capabilities of the private 
sector for the data gathering phase.''
    In 1990, OMB targeted mapping-related activities as an area 
for increased contracting in the President's budget submission 
to Congress. It said, ``Privatization is an important 
management tool to raise productivity, cut costs and improve 
the quality of Government services * * * [the advantages of 
which are] * * * efficiency, quality and innovation in the 
delivery of goods and services * * * specific areas where the 
Government could place greater reliance on private sector 
providers include * * * map-making activities.''
    Also in 1990, the National Academy of Sciences, in a report 
entitled ``Spatial Data Needs, February, 1990, said the U.S. 
Geological Survey should be ``allocating adequate NMD [National 
Mapping Division] resources to information management and user/
donor coordination, and if necessary, increasing these relative 
to traditional data production programs.'' This provision is 
consistent with the budget resolution. Included in the 
resolution is a provision stating ``Congress should examine 
Federal functions to determine those that could be more 
conveniently, efficiently and effectively performed by the 
private sector, and * * * facilitate the privatization of these 
functions.''
    The conference report on the current Budget Resolution 
specifically addressed surveying and mapping, saying, ``U.S. 
Geological Survey conducts research and provides basic 
scientific and information concerning natural hazards and 
environmental issues, as well as water, land, and mineral 
resources. The USGS has three main divisions: the National 
Mapping Division [NMD], the Water Resources Division [WRD] and 
the Geologic Division. This proposal assumes that the NMD will 
aggressively price its products for additional revenue to the 
Treasury. It also assumes greater contracting out to the 
private sector, appropriate data gathering, and map and digital 
data production. Finally, it calls for consolidation of 
overlapping mapping efforts. Within the WRD, savings are first 
assumed in the Federal program for such subprograms as global 
change hydrology and core program hydrology research. Savings 
could also be achieved by increasing the State and local 
matching formula for the Federal/State Cooperative Program.''
    In sum, the committee believes that requiring agencies in 
the Department of the Interior to contract with the private 
sector for surveying and mapping activities is an appropriate 
step for this Congress. While it is appropriate, proper and 
necessary for the Department to be involved in setting 
standards and specifications, research and technology transfer, 
and coordination in the area of geographic data, the actual 
collection of data, through surveying and mapping, is a 
commercial activity and should be performed by the private 
sector.

                SUBTITLE I--NATIONAL PARK SYSTEM REFORM

Secs. 9901-9921. The National Park System Reform Act

    The National Park Service [NPS] is charged with the 
stewardship of many of the nation's precious natural and 
historical resources. The 368 areas which make up the National 
Park System are a diverse collection of parks, historic sites, 
memorials, monuments, seashores, battlefields, parkways and 
trails. These areas are known throughout the world for their 
scenic beauty and historical significance. This subtitle is 
aimed toward maintaining the integrity of the National Park 
System through various improvements to the process of planning 
and establishing units of the National Park System.
    NPS has been directed by Congress (16 U.S.C. la-5) to study 
and monitor areas to determine if they are nationally 
significant and whether they have potential for inclusion in 
the National Park System. To be eligible for favorable 
consideration as a unit of the National Park System, an area 
must: First, possess nationally significant natural or 
historical resources; second, be a suitable and feasible 
addition to the system; and third, require direct NPS 
management instead of alternative protection by other agencies 
or the private sector. These criteria are designed to ensure 
that the National Park System includes only the most 
outstanding examples of the nation's heritage. After the NPS 
studies a potential new area, their study is forwarded to 
Congress.
    The committee believes that the lack of an overall plan to 
guide the future of the National Park System is a serious 
deficiency. Section 8 of the Act of August 18, 1970 (commonly 
known as the General Authorities Act), requires the Secretary 
of the Interior to prepare a comprehensive ``National Park 
System Plan'' which identifies natural and historic themes of 
the United States, from which areas can be identified and 
selected to be units of the National Park System. While the NPS 
has prepared natural and historical Thematic Frameworks, these 
documents cannot really be considered ``plans.'' Instead, these 
documents list major natural and historical themes of the 
United States and then describe how the themes are represented 
by existing National Park System units and historic landmarks. 
These documents do not contain direction about what the 
National Park System should include, what areas are priorities 
for addition to the system, or what themes are currently 
overrepresented in the National Park System. The lack of an 
overall plan to guide the direction and expansion of the system 
is problematic for both NPS and Congress when it comes to 
making decisions about adding new units to the National Park 
System.
    Another area where reforms are needed is the process by 
which areas for addition to the Park System are studied and 
recommended for Congressional consideration. Congress relies 
heavily on NPS studies to make evaluations about the 
significance of an area and its suitability for designation as 
a National Park System unit. Between 1976 and 1981 the NPS had 
a program of identifying high priority candidates for study. 
This program was terminated in 1981, and until very recently, 
NPS has not had a legislative program to recommend potential 
new parks. In the absence of any initiatives coming from the 
NPS, Congress directed numerous studies of specific areas both 
in authorizing legislation and in appropriation act earmarks.
    Several problems with the current new area study process 
exist. First, there are three separate sources for new area 
studies: the NPS itself, the authorizing committees and the 
appropriations committees. There is no agreed upon process for 
ranking the priority of these studies, nor is there adequate 
funding to complete all of them. Because studies usually 
require 2 to 3 years, some studies are delayed indefinitely or 
are started then stopped in midstream because all available 
funding in a particular fiscal year is earmarked for other 
studies. The quality of the studies also ranges widely, as does 
the level of review and scrutiny by the Washington Office of 
the NPS. It has been too easy for political considerations to 
be injected into the study process, and recommendations of 
professional planners are sometimes changed for political 
reasons. Another serious problem is that studies come to 
Congress without any preferred action, which can lead to 
confusion regarding the administration's position on a 
particular area. New area legislation may be introduced on the 
basis of an ambiguous study, when in fact the resource involved 
might not meet the criteria for designation.
    Finally, Members of Congress, the administration and the 
public have all expressed the desire to maintain a high level 
of integrity for units of the National Park System. Views have 
been expressed that some of the 368 units of the National Park 
System may not now meet the criteria of national significance, 
suitability and feasibility and do not belong in the National 
Park System. In fact, the administration recently recommended 
that portions of several units be turned over to the States. 
The lack of consensus regarding the future of areas currently 
managed by the NPS could be due to inaccurate information about 
the significance of an area at the time of designation, 
degradation of a resource after its designation or a 
realization that another agency or level of government would be 
a more appropriate entity to manage a particular area. While 
there have been about two dozen park deauthorizations in the 
past, there has never been a systematic evaluation of the 
entire National Park System to determine if certain areas would 
be more appropriately managed outside the National Park System.

                            Committee Action

    The Committee on Resources met on September 19, 1995, to 
consider a committee print to fulfill the committee's 
instructions under the Budget Resolution. Thirty-nine 
amendments were offered and disposed of, as described by 
subtitle below.

              subtitle a--alaska and helium privatization

                             Part 1--Alaska

Sec. 9001. Exports of Alaska north slope oil

    This section is based on the text of H.R. 70, introduced on 
January 4, 1995, by Mr. Thomas and referred to the Committee on 
Resources. On May 9, the committee held a hearing on H.R. 70, 
at which Mr. Thomas, the administration, the State of Alaska, 
oil producers, maritime labor, and others testified in favor of 
the bill. Representatives of independent refiners, 
shipbuilders, and a refinery union testified in opposition. In 
expressing general support for the bill, the administration 
indicated that it should be amended first, to provide for an 
appropriate environmental review; second, to allow the 
Secretary of Commerce to sanction any anti-competitive behavior 
by exporters; and third, to establish a licensing system.
    On May 17, 1995, Full Resources Committee ordered H.R. 70 
reported with amendments, by a voice vote, to the House of 
Representatives. H.R. 70 was passed by the House of 
Representatives under a Rule on July 24, 1995, by a 324-77 
vote. A companion Senate bill, S. 395, passed the Senate on May 
16, 1995, by a 74-25 vote. The bills are now in conference.
    During consideration of the committee print, no amendments 
were offered to this section.

Sec. 9002. Arctic Coastal Plain leasing and revenue

    On August 1, 1995, the committee held a hearing on the 
issue of potential oil and gas leasing in the 1.5 million acre 
Coastal Plain area of the Arctic National Wildlife Refuge. The 
committee heard from witnesses representing the administration, 
the oil industry, the Alaska Native community and the 
environmental community.
    During the consideration of the committee print, the 
committee considered and disposed of the following amendments 
to section 9002: An amendment offered by Mr. Young of Alaska, 
making some technical and corrective changes, was adopted by 
voice vote.
    An amendment offered by Mr. Vento, striking section 9002, 
was defeated by a rollcall vote of 14-27, as follows: An 
amendment offered by Mr. Miller of California, requiring the 
Secretary of Interior, upon the filing of any legal action by 
the State of Alaska, to suspend any activities relating to an 
oil and gas leasing program authorized by this section, until a 
final nonappealable decision is issued, was defeated by a 
rollcall vote of 14-27, as follows:
     An amendment offered by Mr. Miller of California, 
requiring that 90 percent of all revenues go to the State of 
Alaska, pursuant to the Alaska Statehood Act, and 10 percent 
would go to the Federal Government, failed by a rollcall vote 
of 7-33 as follows:
     An amendment offered by Mr. Vento, precluding any oil and 
gas produced from lands leased under this section from being 
exported, failed by a rollcall vote of 12-25, as follows:
    An amendment offered by Mr. Abercrombie, lifting the 
prohibition on development contained in section 1003 of the 
Alaska National Interest Lands Conservation Act only for 
subsurface lands owned by the Arctic Slope Regional 
Corporation, failed by voice vote.
    An amendment offered by Mr. Faleomavaega, requiring 
recipients of leases, permits or authorizations under section 
9002 to use their best efforts to assure that a fair share of 
employment and contracting is done with Alaska Natives and 
Alaska Native Corporations, passed by voice vote.
    An amendment offered by Mr. Abercrombie, establishing a $5 
million community impact assistance fund, passed by voice vote.
    An amendment was offered by Mr. DeFazio, striking the 
application of environmental laws subsection, failed on voice 
vote.
    An amendment offered by Mr. Young of Alaska, establishing a 
National Endowment for Fish and Wildlife, was adopted by voice 
vote.

Sec. 9003. Alaska Power Administration sale

    This section is based on the text of H.R. 1122, introduced 
on March 3, 1995, by Mr. Young of Alaska. The bill was referred 
to the Committee on Resources, and within the committee was 
referred to the Subcommittee on Water and Power Resources. On 
March 15, 1995, the Subcommittee held a hearing on H.R. 1122, 
where the State of Alaska, the Clinton administration and 
purchasers testified in support. On May 11, 1995, the 
Subcommittee reported out H.R. 1122, with an amendment, by 
voice vote. On May 17, 1995, the Full committee ordered the 
bill reported by voice vote with further amendments.
    During consideration of the committee print, an amendment 
was offered by Mr. Miller of California requiring the price 
charged for the sale of the APA facilities be no less than the 
net present debt value of the outstanding debt owed to the 
United States. The amendment failed by voice vote.

                      Part 2--Helium Privatization

Secs. 9011-9018. Helium Privatization Act of 1995

    This part is based on the text of H.R. 873, introduced on 
February 9, 1995, by Mr. Cox. The significant differences 
included in the committee print changed the helium production, 
refining, and marketing shutdown from 1 year to 18 months, and 
the timing for disposal of facilities, equipment, and property 
from 1 year to 2 years after cessation of production and 
refining operations. Similar legislation, H.R. 846, was 
introduced by Mr. Cremeans on February 7, 1995.
    The bills were referred to the Committee on Resources, and 
then to the Subcommittee on Energy and Mineral Resources. On 
June 22, 1995, the Subcommittee held a hearing on H.R. 873 and 
H.R. 846, where representatives from the Bureau of Mines and 
the National Aeronautics and Space Administration testified in 
support of the concept of the termination of the program, yet 
differed principally in the timing of the shut down and 
importance of debt repayment. Other witnesses represented a 
balanced cross-section of affected interests.
    During consideration of the committee print, three 
amendments to this part were offered. Mr. Thornberry offered an 
amendment similar to legislation originally offered by the 
Clinton administration. This amendment would extend the 
production shutdown time to 3 years, cancel the debt and 
increase the floor limit of the amount of helium to remain in 
the stockpile from 600,000 cubic feet to 5,000,000,000 cubic 
feet. This amendment failed by a rollcall vote of 9-27, as 
follows:
    This amendment was offered with the intent that an adequate 
supply for Federal users be preserved, adequate transition time 
for employees be allowed, and to provide protection for the 
private industry, as well as act in the best interest of the 
taxpayers. The committee believes that all of these legitimate 
concerns are met by the committee print.
    A second amendment was offered by Mr. Thornberry for a land 
transfer of helium property in Potter County, TX, to the Texas 
Plains Girls Scout Council for $1, reserving easement rights. 
The amendment passed by voice vote.
    A third amendment was offered by Mr. Abercrombie to require 
the Secretary of the Interior to use any portion of the Helium 
Production Fund for termination benefits for employees, 
including: education and job training funds, job search 
assistance, extended life insurance and health care coverage, 
leave allowances for job search activities, severance pay for 
employees receiving military retirement pay, compensation for 
unused sick leave, and priority placement in other government 
agencies. During debate on this amendment, Mr. Calvert 
reiterated the committee's view that under the provision in the 
committee print, the Secretary should and can exercise broad 
discretion, under existing law, in developing severance 
packages for terminated employees. This amendment failed by 
record vote of 14-22, as follows:

                      SUBTITLE B--WATER AND POWER

                Part 1--Power Marketing Administrations

Secs. 9201-9204. Power Administration Act

    On May 18, 1995, the Subcommittee on Water and Power 
Resources conducted a hearing concerning the possibility of 
selling one or more of the PMA's and the various issues raised 
by such a sale. Hearing witnesses included several Members of 
Congress as well as representatives of the major interest 
groups. Several legislative proposals have been introduced this 
year in the House with a primary or secondary objective to 
privatize the PMA's. For example, Mr. Klug introduced H.R. 310, 
which calls for privatization of all of the PMA's through an 
open bidding process.
    During the consideration of the committee print, five 
amendments were offered to the PMA sale portion of the print. 
The first, by Mr. Johnson of South Dakota, would have struck 
the PMA sale sections. That amendment was defeated on a 
bipartisan rollcall vote of 18-19, as follows:
     The second amendment, by Mr. Dooley, added the Secretary 
of the Interior to the study section of the bill and other 
added equity interests as the subject of the study. It was 
passed by voice vote. The third was an amendment by Mr. Pickett 
which specified that the sales are subject to existing storage 
rights in the reservoirs that are to be sold. It provided that 
local interests which hold those rights will not be required to 
enter into additional contracts to continue utilizing their 
rights. The amendment was passed by voice vote.
    Mr. Gejdenson offered an amendment which addressed the cost 
of water used to produce surplus crops. It failed on a rollcall 
vote of 12-23, as follows:
    Mr. Allard also offered and withdrew an amendment which 
directed the Secretary of the Interior to convey the Collbran 
Reclamation project, Colorado, to the Ute Water Conservancy 
District and the Collbran Conservancy District.

Sec. 9205. Bonneville Power Administration appropriations refinancing

    H.R. 799, which is almost identical to section 9205, was 
introduced on February 2, 1995, by Mr. Hastings. The bill was 
referred to the Committee on Resources, and within the 
committee to the Subcommittee on Water and Power Resources. On 
June 8, 1995, the subcommittee held a hearing on H.R. 799, 
where the administration testified in support of the bill, 
except for the study provisions contained in what is now 
subsection (k).
    During consideration of the committee print, Mr. Hastings 
offered an amendment to section 9205(h) designed to clarify 
that BPA will only receive a credit against its repayment 
obligations in those years in which it actually makes payments 
to the tribes under the provisions of the Colville settlement 
agreement. The amendment was adopted by voice vote.

                          Part 2--Reclamation

Sec. 9211. Prepayment of certain repayment contracts between the United 
        States and the Central Utah Water Conservancy District

    H.R. 1823, which is very similar to section 9211, was 
introduced on June 13, 1995, by Mr. Hansen. The bill was 
referred to the Committee on Resources, and within the 
committee to the Subcommittee on Water and Power Resources. On 
June 15, 1995, the subcommittee held a hearing on H.R. 1823, at 
which time the administration did not take a position on the 
bill. However, on July 5, 1995, the Commissioner of Reclamation 
sent the subcommittee a letter in which the administration 
recommended certain changes to the legislation which were 
incorporated in section 9211.
    During consideration of the committee print, no amendments 
were offered to this section.

Sec. 9212. Treatment of city of Folsom as a Central Valley project 
        contractor

    No amendments were offered to this section during 
consideration of the committee print.

Sec. 9213. Sly Park

    On June 15, 1995, the Subcommittee on Water and Power 
Resources held an oversight hearing on the possible transfer of 
Bureau of Reclamation facilities out of Federal control. At 
that hearing, the administration testified in support of the 
transfer of ownership and operation and maintenance of Federal 
reclamation facilities to non-Federal interests under 
appropriate conditions. At the same hearing, a board member for 
the El Dorado Irrigation District testified that the district 
felt the Sly Park unit was an appropriate unit to transfer out 
of Federal ownership because it is a detached unit of the 
Central Valley Project [CVP] and is operated independent of all 
other CVP facilities. In addition, he stated that it serves 
only the El Dorado Irrigation District and that all operations 
and maintenance have been performed and paid for by the 
district since the unit's construction in 1955.
    Similar legislation to transfer the Sly Park unit passed 
the House on June 20, 1991, as title XXIV of H.R. 429, the 
Reclamation Projects Authorization and Adjustment Act of 1991.
    During consideration of the committee print, no amendments 
were offered to section 9213.

Sec. 9214. Hetch Hetchy Dam

    No amendments were offered to this section during 
consideration of the committee print.

         SUBTITLE C--NATIONAL PARKS, FORESTS, AND PUBLIC LANDS

                       Part 1--Concession Reform

Secs. 9301-9318. Visitor Facilities and Services Enhancement Act

    H.R. 2028, on which this part is based, was introduced by 
Mr. Hansen on July 13, 1995, and referred to the Committee on 
Resources, with sequential referrals to the Committee on 
Agriculture and the Committee on Transportation and 
Infrastructure. Within the Resources Committee, the bill was 
referred to the subcommittee on National Parks, Forests and 
Lands. The subcommittee held a hearing on this legislation July 
25, 1995.
    During consideration of the committee print, Mr. Hansen 
offered an amendment which clarified the extent of concessioner 
interest in wholly federally owned buildings. The amendment was 
adopted by voice vote.

                   Part 2--National Forest Ski Areas

Secs. 9321-9322. Privatization of forest service ski areas; ski area 
        permit fees and withdrawal of ski areas from operation of 
        mining laws

    This part is based on two bills, H.R. 2028, described 
above, and H.R. 1527, introduced by Mr. Young of Alaska on May 
1, 1995. H.R. 1527 was referred to the Committee on Resources, 
and sequentially to the Committee on Agriculture. Within the 
Resources Committee, the bill was referred to the Subcommittee 
on National Parks, Forests and Lands. The subcommittee held a 
hearing on H.R. 1527 on July 25, 1995.
    During consideration of the committee print, three 
amendments were considered to this part. The first, offered by 
Mr. Vento, struck the entire part. The amendment failed on a 
rollcall vote of 14-20, as follows:
    Mr. Miller of California offered an amendment to change the 
word ``shall'' to ``may'' in section 9321(a) regarding the 
authority of the Secretary of Agriculture to offer ski areas 
for sale to qualifying ski operations. This amendment was 
withdrawn, and Mr. Hansen offered an amendment to clarify 
conditions regarding these sales. The Hansen amendment was 
adopted by voice vote.

                   Part 3--Domestic Livestock Grazing

Secs. 9331-9336. Domestic livestock grazing

    The text included in this part is taken in part from H.R. 
1713, introduced by Mr. Cooley on May 25, 1995, and referred to 
the Committee on Resources and sequentially to the Committee on 
Agriculture. Within the committee, the bill was referred to the 
Subcommittee on National Parks, Forests and Lands. The 
subcommittee held a hearing on H.R. 1713 on July 11, 1995, and 
marked up the bill on September 12, 1995.
    During consideration of the committee print, Mr. Miller of 
California offered an amendment to require that the basic 
grazing fee contained in this part apply to permittees who 
graze 500 animal unit months [AUM] in a grazing fee year, and 
for permittees grazing more than 500 AUM's, the fee would be 
fair market rate. The Miller amendment failed on a rollcall 
vote of 8-26, as follows:

     Part 4--Regional disposal facility of Southwestern Low Level 
                   Radioactive Waste Disposal Compact

    During the 102d and 103d Congresses, the Committee on 
Resources held several hearings on low level waste related 
issues. In the course of those hearings, matters related to 
Ward Valley were examined. In the 104th Congress, the Committee 
on Resources included legislative language directing the 
transfer of Bureau of Land Management land to the State of 
California for purposes of allowing the low-level waste 
facility to be constructed.
    During consideration of the committee print, one amendment 
was offered to this part by Mr. Miller of California, to strike 
the provision. It was defeated on a voice vote.

                        SUBTITLE D--TERRITORIES

    This subtitle was taken in part from the text of two bills, 
H.R. 602, introduced by Mr. Gallegy on January 20, 1995, and 
H.R. 1332, also introduced by Mr. Gallegly on March 28, 1995. 
Both bills were referred to the Committee on Resources (H.R. 
602 was also referred to three other committees) and within the 
committee to the Subcommittee on Native American and Insular 
Affairs.
    On January 31, 1995, the subcommittee held a hearing on 
H.R. 602, the Omnibus Territories Act, addressing a broad array 
of territorial issues, including the termination of funding for 
the Office of Territorial and International Affairs [OTIA] and 
the Northern Mariana Islands covenant grants. The subcommittee 
also held a hearing on H.R. 1332 on March 29, 1995.
    On April 5, 1995, the subcommittee marked up H.R. 1332, and 
reported it by voice vote to the full Resources Committee with 
an amendment in the nature of a substitute which expanded the 
bill to include provisions from H.R. 602 which terminated both 
OTIA and the covenant grants. The full committee marked up H.R. 
1332 on May 24, 1995, and ordered the bill, as amended, 
reported to the House of Representatives by voice vote.
    No amendments were offered to this subtitle during 
consideration of the committee print.

                          SUBTITLE E--MINERALS

                        Part 1--Hardrock Mining

Secs. 9501-9505. Hardrock mining

    An oversight hearing of the Subcommittee on Energy and 
Mineral Resources was held on January 31, 1995, to examine 
investment trends in hardrock mineral exploration and 
development to determine if our domestic mining industry is 
competitive in the internal arena. The transcript of the 
hearing was published as House Hearing 104-17.
    H.R. 1580, a bill to amend the general mining laws to 
provide a reasonable royalty from mineral activities on Federal 
lands, to specify reclamation requirements for mineral 
activities on Federal lands, to create a State program for the 
reclamation of abandoned hardrock mining sites on Federal 
lands, and for other purposes, was introduced on May 9, 1995, 
by Mr. Young of Alaska. The bill was referred to the Committee 
on Resources, and within the committee to the Subcommittee on 
Energy and Mineral Resources. This part is derived from H.R. 
1580 predominately, but does not contain the nonrevenue-
generating provisions of that bill, and contains substantial 
revisions to the claim maintenance fees section.
    In addition, an oversight hearing of the Subcommittee of 
Energy and Mineral Resources was held on May 8, 1995, to 
examine the issue of a proposed administrative increase in the 
royalty rate for Green River, WY trona leases.
    During the consideration of the committee print, Mr. Rahall 
offered an amendment to strike the entire part and substitute 
new provisions including imposition of a royalty of 8 percent 
of gross income with only such mining claims for which patent 
application was pending on January 27, 1995, potentially 
exempted from such terms, and extending the claim maintenance 
fees of the Omnibus Budget Reconciliation Act of 1993 in like 
manner. The amendment was defeated by rollcall vote of 13-18, 
as follows:
    Mr. Calvert offered an en bloc amendment to: (1) clarify 
the intent of the committee in adopting the patent transition 
provision is to include claims, such as those delineated in 
section 106 of the California Desert Act of 1994, where 
wilderness study area status has kept the owners of several 
blocks of claims from being able to further prospect and 
develop their claims for over 10 years; (2) delete the 
provision for ``down payments'' in the committee print relating 
to payment of fair market value for the land within a claim to 
be patented; and (3) increase the fraction of royalty receipts 
returned to the State where production occurred to one-third. 
The en bloc amendment was adopted by a rollcall vote of 22-12, 
as follows:
    Mr. Abercrombie offered an amendment to strike provisions 
delineating certain allowable deductions for royalty purposes, 
including costs of support personnel directly associated with 
mine operation, depreciation of capital assets associated with 
operation of a mine, and reasonable allowance for overhead. The 
amendment was defeated by a rollcall vote of 11-23, as follows:
    Mr. Abercrombie offered an amendment to raise the minimum 
royalty rate on sodium compounds produced under the Mineral 
Leasing Act of 1920 to not less than 8 percent of gross 
proceeds. The amendment was defeated by voice vote.
    Mrs. Cubin offered an amendment to limit the royalty rate 
on sodium compounds to not greater than 5\1/2\ percent of the 
gross proceeds unless and until a report to Congress prepared 
by the Secretary of the Interior in consultation with the 
Secretary of Commerce and the U.S. Trade Representative 
regarding export considerations recommends a further increase, 
and directed the Secretary of the Interior to offer for 
competitive bid within 90 days of enactment sodium leases on 
tracts now pending application. The amendment was adopted by 
voice vote.

                 Part 2--Federal Oil and Gas Royalties

Secs. 9511-9526. The Federal Oil and Gas Royalty Simplification and 
        Fairness Act of 1995

    The basis for this part, H.R. 1975, was introduced on June 
30, 1995, by Mr. Calvert. The bill was referred to the 
Committee on Resources, and within the committee to the 
Subcommittee on Energy and Mineral Resources. On July 18, 1995, 
the subcommittee held a hearing on H.R. 1975 where the 
administration testified in support of many of the goals of the 
legislation. On August 4, 1995, Mr. Calvert and Mr. Abercrombie 
met with representatives of the administration, States, and 
industry and requested the parties to work together to narrow 
the differences evidenced by testimony from the hearing. 
Discussions were held in August 1995, by which new language was 
crafted and incorporated into the committee print for budget 
reconciliation.
    During consideration of the committee print, Mr. Calvert 
offered eight amendments en bloc to this part. Mr. Abercrombie 
offered a division motion, and the amendments were discussed 
individually. Upon completion of the discussion, the amendments 
were adopted by voice vote. The Calvert en bloc package 
included the following amendments:
    Amendment No. 1 struck the restructured accounting language 
in section 9512 so that the statute of limitations is not 
defeated by this procedure. Overall, no extensions of the time 
limit are allowed unless a company refuses to comply with an 
order or notice as specified in this part.
    Amendment No. 2 struck the definition of the United States 
in section 9512 so that States can file suits, consistent with 
this part.
    Amendment No. 3 added paperwork reduction requirements in 
section 9521 to royalty activities, thereby reducing paperwork 
burdens and the cost of royalty collections.
    Amendment No. 4 clarified royalty liability in section 9512 
by delineating the Federal Government's ability to collect a 
royalty to the actual responsible party.
    Amendment No. 5 clarified which persons within the 
Department of the Interior who may issue a subpoena to obtain 
records.
    Amendment No. 6 amended the interest provisions to equate 
the interest rate payable on royalty overpayments to that which 
the Internal Revenue Service currently pays to income tax 
payers.
    Amendment No. 7 struck section 9519, thereby restoring the 
provision that the plaintiff give 60 days notice prior to 
filing a lawsuit regarding outer continental shelf matters.
    Amendment No. 8 included technical changes clarifying a 
State's rights under the bill, including the right to define 
marginal properties, and to reject any sale of marginal 
properties proposed by the Secretary. The amendment also 
clarifies that the Secretary shall waive interest when it is 
not cost effective or efficient to collect, and provides for 
the royalty report to serve as notice for any adjustment on an 
overpayment or underpayment.
    Mr. Dooley offered an amendment to extend the payment due 
date for royalties to the last day of the second calendar month 
after production is due. This amendment requires the Secretary 
to implement this extension in a phased-in manner, provided it 
does not have a negative impact on the Federal budget. This 
amendment passed by voice vote.
    Mr. Faleomavaega offered an amendment to clarify the effect 
of this part on Indian tribes. The amendment passed by voice 
vote.

                  SUBTITLE F--INDIAN GAMING AND HEALTH

    Mr. Faleomavaega offered an amendment clarifying Medicare 
and Medicaid benefits to Native Americans if new State plans 
are created as a result of reforms currently proposed by 
Congress. The amendment was adopted by voice vote.

                        SUBTITLE G--CONSULTATION

    A technical amendment to clarify the intent of section 9701 
was offered by Mr. Pombo, and adopted by voice vote.

                          SUBTITLE H--MAPPING

    The provisions contained in the committee's reconciliation 
language are very similar to bills which have been introduced 
for the past several Congresses. The issues addressed by these 
provisions have been discussed in previous Congresses as well.
    During consideration of the committee print, Mr. 
Abercrombie offered an amendment to strike this subtitle, but 
withdrew it.

                SUBTITLE I--NATIONAL PARK SYSTEM REFORM

    H.R. 260 was introduced on January 4, 1995, by Mr. Hefley. 
The bill was referred to the Committee on Resources, and within 
the committee to the Subcommittee on National Parks, Forests 
and Lands. On February 23, 1995, the subcommittee held a 
hearing on H.R. 260, where a broad spectrum of witnesses 
testified in support of the entire bill and the administration 
testified in support of a portion of it. On March 29, 1995, the 
subcommittee ordered H.R. 260 reported with amendments by voice 
vote.
    On May 17, 1995, the full Resources Committee ordered H.R. 
260 reported with further amendments by a rollcall vote of 34-
8. On September 19, 1995, H.R. 260 was defeated under 
suspension of the rules by a record vote of 180-231.
    During consideration of the committee print, Mr. Hansen 
offered the Resources Committee reported text of H.R. 260 as a 
new subtitle. The amendment passed by a rollcall vote of 23-7, 
as follows:
    Finally, Mr. Gejdenson offered an amendment created a new 
subtitle regarding reliance on Forest Service timber sale 
receipts to fund timber sales. The amendment was defeated on a 
rollcall vote of 11-26, as follows:
    The committee print, as amended, was adopted and ordered 
submitted to the Committee on Budget by a rollcall vote of 25-
12, as follows:

                      Section-by-Section Analysis

Sec. 9000. Table of contents.

    This section contains the table of contents for the 
committee print.

              SUBTITLE A--ALASKA AND HELIUM PRIVATIZATION

                             Part 1--Alaska

Sec. 9001. Exports of Alaska North Slope Oil

    Subsection (a) amends section 28 of the Mineral Leasing Act 
to allow the export of any oil transported by pipeline over a 
right-of-way granted pursuant to the Trans Alaska Pipeline 
Authorization Act unless the President finds that exports are 
not in the national interest. It also directs the President to 
make a national interest determination within 5 months after 
enactment.
    The section requires the President to consider, in making 
his national interest determination: First, whether exports 
would affect the quality or quantity of oil available in the 
United States; second, the results of an environmental review 
and any measures necessary to mitigate adverse environmental 
effects of exports; and third, whether exports are likely to 
cause oil supply shortages that impact prices above the world 
market price or that cause sustained material adverse 
employment effects.
    The section allows the President to impose conditions, 
other than a volume limitation, as are necessary, and requires 
any oil exported to be carried in U.S.-flag, U.S.-manned 
vessels except when exported to Israel and other countries 
pursuant to the international emergency oil sharing plan of the 
International Energy Agency. The section also preserves the 
President's inherent authority to retract exports in an 
emergency.
    Section 9001 requires that any rules necessary for 
implementation of the President's national interest 
determination be issued by the Secretary of Commerce, in 
consultation with the Secretary of Energy, within 30 days of 
the President's determination. The section allows the Secretary 
of Commerce, in consultation with the Secretary of Energy, if 
they find that the oil supply shortages and price increases 
have caused adverse employment effects, to recommend to the 
President appropriate actions, including revoking the authority 
to export.
    Finally, the section requires the General Accounting Office 
to report to Congress 2 years after enactment on findings 
related to effects of exports on consumers, independent 
refiners, and shipbuilding and ship repair yards on the west 
coast and in Hawaii.

Sec. 9002. Arctic Coastal Plain leasing and revenue

    Subsection (a) sets forth the purpose of section 9002, 
which addresses and authorizes oil and gas leasing in the 1.5 
million acre coastal plain area of the Arctic National Wildlife 
Refuge [ANWR]. The purpose of this section is to reduce the 
Federal deficit by increasing Federal revenues by an estimated 
$1.3 billion over the 5-year budget window following the 
enactment of section 9002. The source of this new revenue will 
be from competitive bonus bids made at Federal oil and gas 
lease sales within the 1.5 million coastal plain area of the 19 
million acre Arctic National Wildlife Refuge. The coastal plain 
consists of 1.5 million acres, 92,000 acres of which is private 
property owned by the Inupiat Eskimo people who live on the 
North Slope of Alaska. This area is adjacent to Prudhoe Bay and 
other producing oil fields on the North Slope. The Village of 
Kaktovik is the only community located in the coastal plain. 
The Inupiat Eskimo residents of Kaktovik support the lease sale 
and have adopted resolutions urging favorable action. This area 
is intensively used by the Inupiat for subsistence and cultural 
purposes. The coastal plain is also the site of a major 
Department of Defense facility.
    Subsection (b) sets forth definitions for the terms as they 
are used in section 9002.
    Subsection (c) sets forth a congressional determination of 
``compatibility.'' The subsection states that no further 
findings or determinations of congressional compatibility or by 
any Federal official under any other provision of law is 
required to implement this congressional determination 
authorizing oil and gas leasing in the coastal plain. For 
example, no further findings or determinations need to be made 
by the Secretary of the Interior under the National Wildlife 
Refuge System Administration Act to implement this 
determination.
    In making the determination set forth in this subsection, 
the committee notes the unique status of the coastal plain 
resulting from the provisions in the Alaska National Interest 
Lands Conservation Act of 1980 [ANILCA]. ANILCA required a 
special 5-year study of the coastal plain's wilderness, 
wildlife, energy, and other values and directed that Congress 
be the final arbiter of any and all competing values or 
interests in this area. The language in this subsection 
concerning oil and gas leasing, exploration, development and 
transportation and this compatibility determination should not, 
however, be viewed as a precedent with respect to other units 
of the refuge system or a precedent for other nonoil and gas 
related uses in ANWR.
    Subsection (d)(1) directs the Secretary and other 
appropriate Federal officers and agencies to take such actions 
as are necessary to authorize, establish and promptly implement 
a competitive oil and gas leasing program that will assure the 
expeditious exploration, development, production and 
transportation of the oil and gas resources of the coastal 
plain. The subsection requires the Secretary to implement this 
program and to promulgate all regulations to govern leasing, 
exploration, development and production within 6 months of the 
date of enactment of section 9002.
    Subsection (d)(2) sets forth the basic terms and provisions 
that the Secretary is to address and to include in the 
regulations promulgated under subsection (d)(1) to implement an 
oil and gas leasing program within the coastal plain. The 
regulations and lease terms and provisions shall include the 
following:
          The coastal plain oil and gas lease sale is to be 
        conducted within 12 months of the date of enactment of 
        section 9002. This expeditious action is required to 
        ensure that revenue from bonus bids for coastal plain 
        leases are promptly provided to the Federal Treasury to 
        address the Federal deficit as provided for in the 
        recently adopted budget resolution. Expedition is also 
        needed because of the long lead time required to 
        develop oil and gas resources on the North Slope due to 
        many factors, including extreme Arctic climate 
        conditions; the need to accommodate fish and wildlife 
        needs; and the very cumbersome and protracted Federal 
        regulatory and permitting process. Swift action is also 
        required because production at Prudhoe Bay and other 
        North Slope oil fields, which had been in excess of 2 
        million barrels of oil per day, has declined since 1990 
        to 1.5 million barrels per day. It is very important 
        that new sources of oil, such as the coastal plain, be 
        placed into commercial production as soon as possible 
        to replace depleting oil resources. Otherwise, 
        commercial operation of the Trans-Alaska Pipeline 
        cannot be maintained. If commercial production falls to 
        such low levels that pipeline operation must be 
        discontinued, the pipeline will be closed and under 
        applicable Federal regulations and permit stipulations 
        the pipeline will have to be dismantled and removed. 
        Such a result would mean that further production of 
        newly discovered oil resources on the North Slope would 
        require costly construction of an immensely expensive 
        new transportation system.
          The competitive leasing program developed by the 
        Secretary under section 9002 shall be based upon the 
        traditional or ``nomination'' process used by the 
        Department of the Interior in other competitive bonus 
        bid lease sales. In reviewing nominations and 
        considering tracts of lands to be offered for leasing, 
        the Secretary shall provide notice and engage in 
        periodic consultations with the State of Alaska, the 
        North Slope Borough, the Village of Kaktovik and other 
        affected local governments in Alaska; oil and gas 
        lessees; representatives of organizations engaged in 
        activity in or on the coastal plain, including native 
        people and others involved in subsistence uses and 
        recreational activities; and owners of private lands in 
        the area such as Arctic Slope Regional Corporation and 
        Kaktovik Inupiat Corporation.
          The Secretary must grant oil and gas leases on 
        unleased Federal lands within the coastal plain to the 
        highest responsible qualified bidder or bidders, by 
        competitive bidding and under regulations promulgated 
        in advance. This subsection further provides that 
        regulations promulgated under section 9002 may allow 
        for the deposit of cash bids in an interest-bearing 
        account until the Secretary accepts the bids, with 
        interest earned through such accounts paid to the 
        General Treasury for bids that are accepted, and to the 
        unsuccessful bidders for bids that are rejected.
          Royalty payments under the Secretary's regulations 
        and under the leases for the coastal plain shall be no 
        less than the traditional 12\1/2\ percent used by the 
        Department in most other Federal oil and gas lease 
        sales. The committee expects that the Secretary will 
        follow the traditional practice of 12\1/2\ percent 
        rather than set a substantially higher royalty. The 
        committee believes that a higher royalty would likely 
        reduce the amount of the upfront competitive bonus 
        bids, thereby reducing the projected $1.3 billion to 
        the Federal Treasury from leasing. Further, higher 
        royalties would tend to encourage bidding and 
        development on only the best prospects, with the result 
        that other prospects might not be fully explored and 
        that ``economically marginal'' oil fields might not be 
        placed in commercial production. Finally, the committee 
        recognizes that high royalties can lead to premature 
        abandonment of marginally economic fields that are 
        nevertheless still producing oil. Such premature 
        abandonment could mean the loss of important energy 
        resources owned by the United States in the coastal 
        plain. Because of the high costs of production and 
        transportation on Alaska's North Slope, these economic 
        factors are very important and the committee expects 
        the Secretary to be guided accordingly in fashioning 
        regulations which will assist and not burden investment 
        in coastal plain oil and gas development, thereby 
        depressing job creation and the other economic benefits 
        that will be associated with developing the coastal 
        plain's oil and gas resources.
          The Nation's antitrust laws are, of course, fully 
        applicable to the Secretary's regulations regarding 
        activity on the coastal plain, as well as to the 
        conduct of the lease sales under this section, and to 
        the activities of bidders and lessees. This subsection 
        assures that activities under section 9002 will be 
        conducted in a competitive manner, in accordance with 
        the antitrust laws, and with the benefit of any review 
        the Attorney General and/or the Federal Trade 
        Commission may determine is warranted.
          The size of lease tracts in the coastal plain may be 
        from 2,560 to 11,520 acres, as determined by the 
        Secretary. The committee expects the Secretary to 
        consider the following factors in determining the size 
        of lease tracts: Maximizing revenue to the Treasury; 
        maintaining vigorous competition; addressing the high 
        cost of Arctic exploration and production; including 
        appropriate fish, wildlife, and environmental 
        considerations; considering the size and location of 
        identified prospects; and providing incentives for 
        independent oil and gas producers to participate in the 
        lease sale. In this regard, this subsection provides 
        that the Secretary may lease tracts smaller than 2,560 
        acres if the Secretary determines that this is 
        necessary to ensure competition by attracting smaller 
        independent oil companies, or to make available more 
        leases in the areas believed to be exceptionally good 
        prospects for oil and gas. Finally, the committee 
        provides for smaller lease tracts where they are 
        necessary to mitigate reasonably foreseeable adverse 
        impacts on the environment. The committee anticipates, 
        for example, that when the Secretary has designated a 
        ``special area'' under subsection (g)(3) of section 
        9002, such action might require the leasing of adjacent 
        tracts smaller than 2,560 acres to accommodate the 
        geographic boundary of any ``special area or areas.''
          Oil and gas leases shall be issued for an initial 
        period of 10 years, and shall be extended for so long 
        thereafter as oil and gas is produced in paying 
        quantities from the lease or unit area to which the 
        lease is committed, or for so long as drilling or 
        reworking operations (as approved by the Secretary) are 
        conducted on the lease or unit area.
          The Secretary must include in the coastal plain 
        leasing regulations as well as in the terms and 
        conditions of the leases issued under section 9002 a 
        number of matters that are customarily or routinely 
        addressed in Federal oil and gas leases on public lands 
        in Arctic Alaska. In granting this authority to the 
        Secretary and to the Department's agencies that are 
        experienced in conducting lease sales and in developing 
        and administering the provisions of applicable 
        regulations and leases, the committee expects the 
        Secretary to rely on proven precedent and historic 
        practice. By this, the committee expects the Secretary 
        and the Department to follow precedent and prior 
        practices that have protected the environment and 
        public values, but have not burdened the economics of 
        oil exploration and production, or led to a reduction 
        in the number of potential leases or lessees because of 
        burdensome or unreasonable regulations.
          Lessees will be required to conduct their activities 
        under leases issued under section 9002 pursuant to 
        exploration and development plans that have been 
        approved by the Secretary or the Secretary's designee. 
        The committee expects that the regulations issued 
        pursuant to this paragraph will address the form and 
        the minimal content of such plans. The committee does 
        not intend that this requirement be costly, burdensome, 
        or lead to unnecessary delay. The purpose here is 
        simply to assure that lessees understand, anticipate, 
        and appropriately address any unique environmental, 
        fish, and wildlife, or other conditions that may be 
        associated with activities under their lease or leases 
        before significant exploration or developmental 
        activities are initiated.
          The Secretary's regulations and lease terms must 
        require the lessee to secure an appropriate performance 
        bond to cover activities conducted under oil and gas 
        leases on the coastal plain. The committee's intent 
        here is to ensure that lessees are obligated to--and 
        have the demonstrated financial capability to--fully 
        comply with the requirements of section 9002, its 
        implementing regulations and the terms and conditions 
        of leases issued pursuant to this section. The 
        committee intends that the form of the bond or 
        financial commitment be secondary to the purpose of 
        ensuring compliance by the lessee or the lessees' third 
        party agents or contractors, and that no obligation or 
        liability will be incurred by the United States. The 
        requirement set forth in this paragraph should be 
        implemented reasonably and in a manner that ensures 
        against any continuing environmental damage or harm, 
        follows traditional leasing practices, enhances 
        competition, maximizes Federal revenue, protects the 
        environment, and enables independent producers to both 
        bid and operate successfully within the coastal plain.
          The Secretary's regulations and terms of the leases 
        shall include terms which will ensure that provision is 
        made for suspension, cancellation, assignment, 
        relinquishment, and unitization of leases. The 
        committee again expects that the Secretary and the 
        Department will follow traditional and customary 
        Federal oil and gas lease practice in developing 
        regulations and terms for leases that address and 
        govern each of these subjects.
          The Secretary's regulations and the terms of the 
        leases shall include terms that will assure the 
        Secretary reasonable access to information concerning 
        activities under leases. This paragraph also assures 
        that confidential, privileged, or proprietary 
        information furnished by lessees to the Secretary under 
        the regulations or the lease terms is adequately 
        protected. The Secretary and the Department have a long 
        history and ample experience dealing with this kind of 
        information under oil and gas leases. The committee 
        expects the Secretary to have access to all needed 
        information and, at the same time, to see that the 
        proprietary data and information of lessees is properly 
        protected.
    Subsection (e) provides that any complaint filed that seeks 
judicial review of an action of the Secretary in promulgating 
any regulation under this section may be filed only in the U.S. 
Court of Appeals for the District of Columbia. This subsection 
further requires that such complaint shall be filed within 90 
days from the date of promulgation of a regulation, or after 
such date if such complaint is based solely on grounds arising 
after 90 days, in which case the complaint must be filed within 
90 days after the complainant knew or reasonably should have 
known of the grounds for the complaint. Finally, this 
subsection states that any complaint seeking judicial review of 
any other actions of the Secretary under this section may be 
filed in any appropriate district court of the United States. 
Complaints seeking review of other actions must be filed within 
90 days from the date of the action being challenged, or after 
such date if such complaint is based solely on grounds arising 
after 90 days, in which case the complaint must be filed within 
90 days after the complainant knew or reasonably should have 
known of the grounds for the complaint.
    Under subsection (f)(1), the prohibitions and limitations 
contained in section 1003 of the Alaska National Interest Lands 
Conservation Act of 1980 (94 Stat. 2452; 16 U.S.C. 3143) are 
repealed. This includes prohibitions on the private lands of 
the Inupiat Eskimo people in the coastal plain and in the 
Arctic National Wildlife Refuge.
    Under subsection (f)(2), section 9002 shall be considered 
the primary land management authorization for all activities 
associated with exploration, development, production, and 
transportation of oil and gas from the coastal plain. The 
committee intends that no land management review, 
determination, or other action shall be required for actions 
authorized and directed pursuant to section 9002 except as 
specifically authorized by this subsection.
    Subsection (g)(1) provides that the Secretary shall 
promulgate such rules and regulations as are necessary to 
ensure that oil and gas exploration, development, production, 
and transportation activities undertaken in the coastal plain 
achieve reasonable protection of the fish and wildlife 
resources, environment and subsistence uses of the coastal 
plain before conducting a competitive oil and gas lease sale 
under section 9002.
    Subsection (g)(2) directs the Secretary to administer the 
provisions of this section through regulations and lease terms 
that the Secretary determines to be necessary to mitigate 
reasonably foreseeable and significantly adverse effects on the 
fish and wildlife, surface resources and subsistence resources 
of the coastal plain.
    Subsection (g)(3)(A) authorizes the Secretary, after 
consultation with the State of Alaska, the village of Kaktovik, 
AK, and the North Slope Borough, to close to leasing and 
designate up to 30,000 acres of the coastal plain as ``Special 
Areas''. The Secretary is authorized to close such areas only 
if the Secretary determines that these lands are of such unique 
character and interest so as to require special management and 
regulatory protection. Ninety days in advance of such a 
designation, however, the Secretary shall notify the Committee 
on Resources of the House of Representatives and the Committee 
on Energy and Natural Resources of the Senate. Further, this 
subparagraph states that the Secretary may, if appropriate, 
permit leasing of all or portions of any lands within the 
coastal plain designated as Special Areas by setting lease 
terms that limit or condition surface use and occupancy by 
lessees of such lands, but which will permit the use of 
horizontal drilling technology from sites on leases or lands 
located outside the designated Special Areas.
    Subsection (g)(3)(B) provides that, notwithstanding any 
other provision of law or any international agreement to which 
the United States is a party, the Secretary's sole authority to 
close lands within the coastal plain to oil and gas leasing and 
to exploration, development, and production as provided for in 
this part is set forth in subparagraph (A) of this subsection.
    Subsection (g)(4) requires the Secretary to develop 
guidelines to encourage the sitting of facilities having common 
use characteristics (service bases, ports and docks, airports, 
major pipelines, and roads) in a manner that leads to facility 
consolidation, avoids unnecessary duplication, utilizes 
existing facilities, minimizes impacts on fish, wildlife, 
habitat and the subsistence activities of residents of Native 
communities, and avoids disruption of the lives of the 
residents of the village of Kaktovik and other communities. 
This subsection further requires that the Secretary develop 
these guidelines in consultation with the State of Alaska and 
the North Slope Borough.
    Subsection (g)(5) provides that, notwithstanding title XI 
of the Alaska National Interest Lands Conservation Act of 1980, 
the Secretary is authorized and directed to grant, under 
section 28 of the Mineral Leasing Act (30 U.S.C. 185), all 
necessary permits, authorizations, rights-of-way and easements 
across the coastal plain for the purposes of section 9002, as 
well as for pipeline construction and the transportation of oil 
and gas and related purposes.
    Subsection (g)(6) authorizes the Secretary to close, on a 
seasonal basis, portions of the coastal plain to exploratory 
drilling activities as necessary to protect caribou calving 
areas, and to protect other species of fish and wildlife for 
limited periods of time as been done in connection with oil and 
gas activities on other areas of the North Slope.
    Subsection (h) sets forth a determination that the ``Final 
Legislative Environmental Impact Statement'' (April 1987) 
prepared pursuant to section 1002 of the Alaska National 
Interest Lands Conservation Act of 1980 and section 102(2)(C) 
of the National Environmental Policy Act of 1969 is adequate 
and legally sufficient for all actions authorized pursuant to 
section 9002. The committee intends that this determination 
should include all phases of oil and gas leasing, exploration, 
development, production, transportation and related activities, 
including the granting of right-of-way, use permits and other 
authorizations.
    Subsection (i) directs that all revenues received from 
competitive bids, sales, bonuses, royalties, rents, fees, 
interest or other income derived from the leasing of oil and 
gas resources within the coastal plain shall be deposited into 
the Treasury of the United States, notwithstanding any other 
provision of law. This subsection further requires that 50 
percent of all such coastal plain revenues deposited pursuant 
to this subsection shall be paid to the State of Alaska by the 
Secretary of the Treasury semiannually, on March 30 and on 
September 30 of each year.
    This subsection also requires the Secretary to prepare and 
submit an annual report to the Congress on the revenues derived 
and on the leasing program authorized by this section on March 
1 of each year following the date of enactment of section 9002.
    Subsection (j) authorizes and directs the Secretary to 
convey to the Kaktovik Inupiat Corporation the surface estate 
of the lands described in paragraph 2 of Public Land Order 
6959, to the extent necessary to fulfill the corporation 
entitlement under section 12 of the Alaska Native Claims 
Settlement Act, as well as to convey to the Arctic Slope 
Regional Corporation the subsurface estate beneath such surface 
estate pursuant to the April 9, 1993, Agreement between the 
Arctic Slope Regional Corporation and the United States of 
America. These conveyances shall occur notwithstanding the 
provisions of section 1302(h)(2) of the Alaska National 
Interest Lands Conservation Act.
    Subsection (k) provides that any person (including any 
Federal official) who fails to comply with any provision or 
mandate of section 9002, a lease term, or regulation 
promulgated under section 9002, shall be liable after notice of 
such failure expiration of a reasonable period for corrective 
action, and after a hearing for a civil penalty of not more 
than $10,000 for each day of the continuation of such failure.
    The committee fully expects the administration and 
Secretary Babbitt to implement, in good faith and in a positive 
manner, this committee's policy decision on the future of the 
coastal plain's energy resources. Finally, the committee 
regrets that the administration did not seek to join in a 
debate on how coastal plain revenues over and above the budget 
resolution deficit targets and instructions could have been 
directed a important areas of need in the Nation's environment, 
natural resource and preservation programs. That opportunity 
for consultation has passed for now, but the committee stands 
prepared to revisit the issue in the future. Meanwhile, the 
committee has adopted as resource endowment approach that 
addresses fish, wildlife and habitat acquisition needs in 
subsection 9002(n).

Sec. 9003. Alaska Power Administration sale

    Subsection (a) defines terms for the purposes of this 
section.
    Subsection (b) authorizes and directs the Secretary of 
Energy to sell and transfer the Snettisham and Eklutna assets 
and directs other Federal agencies to cooperate with the 
Secretary of Energy in implementing the sales. The subsection 
authorizes to be appropriated such sums as may be necessary to 
prepare the assets for sale, and allows the APA to accept 
contributed funds for the purchasers for upgrading, improving, 
maintaining, or administering Snettisham or Eklutna.
    Subsection (c) stipulates that the U.S. District Court for 
the District of Alaska shall have jurisdiction over decisions 
made under the Memorandum of Agreement [MOA] entered into 
between the State of Alaska, the Eklutna Purchasers, the Alaska 
Energy Authority and Federal fish and wildlife agencies 
regarding the protection, mitigation of damages to, and 
enhancement of fish and wildlife. The subsection further states 
that any action seeking review of the fish and wildlife program 
under the MOA must be brought within 90 days or be barred.
    Subsection (c) also provides that the Secretary of Interior 
shall issue rights-of-ways to APA for subsequent use by the 
purchasers and to provide future access to Federal lands in the 
event the assets are ever resold, stipulates that the Secretary 
of Interior can convey certain lands associated with the 
projects to the State of Alaska under section 6 of the Alaska 
Statehood Act, and stipulates that the sale is not considered a 
disposal of assets under the provisions of section 203 of the 
Federal Property and Administration Services Act of 1949.
    Subsection (d) stipulates that following the sale and 
transfer of assets, the APA shall cease to exist and that all 
proceeds from the sale of the assets shall be credited to 
miscellaneous receipts in the Treasury.

                      Part 2--Helium Privatization

Sec. 9011. Short title

    This section provides the short title of this part, the 
Helium Privatation Act of 1995.

Sec. 9012. Amendment of Helium Act

    This section provides that unless otherwise noted, this 
bill amends the 1960 Helium Act.

Sec. 9013. Authority of Secretary

    This section amends sections 3, 4, and 5 of the 1960 act as 
follows:
    New section 3(a) would authorize the Secretary of the 
Interior to enter into contracts with private parties to 
recover and dispose of helium on Federal lands.
    New section 3(b) would authorize the Secretary to store, 
transport, and sell helium only in accordance with the bill.
    New section 3(c) would authorize the Secretary to monitor 
helium production and helium reserves in the United States and 
to periodically prepare reports on the above and on the 
quantity of crude helium in storage in the United States.
    New section 4(a) would authorize the Secretary to store and 
transport crude helium and to maintain and operate crude helium 
and to maintain and operate crude helium storage at the Bureau 
of Mines Cliffside Field, together with related helium 
transportation and withdrawal facilities.
    New section 4(b) would require the Secretary to cease 
producing, refining, and marketing refined helium within 18 
months after enactment of this bill.
    New section 4(c) would require the Secretary to dispose of 
all facilities, equipment, and other real and personal property 
held for the refining, producing, and marketing of refined 
helium within 2 years after the Secretary ceases production, 
refining, and marketing operations. All proceeds from the sale 
of such facilities shall be applied against the outstanding 
helium fund debt. All costs associated with the sale and 
disposal, including costs associated with termination of 
personnel, shall be paid from the helium production fund.
    New section 4(d) provides that any contract for refined 
helium in effect on the date of enactment of this bill would 
stay in effect until the facilities listed in the previous 
section are sold. This section also provides for any costs 
associated with termination of such contracts. Funds for such 
costs shall be drawn from the helium production fund.
    New section 5 provides for full cost recovery for helium 
storage, withdrawal, or transportation services provided by the 
Secretary.

Sec. 9014. Sale of crude helium

    This section provides for the sale of crude helium. It 
amends section 6 of the 1960 act to require that those 
individuals who enter into contracts with Federal agencies to 
provide helium also purchase an equivalent amount from the 
Secretary. The Secretary is precluded from making sales of 
crude helium in amounts that would disrupt the market.
    All funds collected pursuant to this section shall be 
deposited against the helium debt, which shall be frozen at the 
amount outstanding on October 1, 1995. The minimum price of 
crude helium sold by the Secretary would be determined on the 
basis of the outstanding amount owed against the debt in 
comparison with the volume of crude helium in the Cliffside 
Reservoir.
    Subsection (d) would be amended to require that all funds 
received from the sale or disposition of helium produced under 
a Federal lease be deposited against the debt.
    Subsection (e) would be repealed
    Subsection (f) would be amended to provide that all funds 
generated from disposal of facilities and sales would be 
deposited in the helium fund to be paid against the debt, and 
that such fund's balance would not be greater than $2 million 
per year. Once the debt is repaid, the fund would be 
terminated.

Sec. 9015. Elimination of stockpile

    This section would amend section 8 of the Helium Act as 
follows:
    Subsection (a) would require the Secretary to annually 
review the known helium reserves in the United States and 
determine the expected life of said reserves.
    Subsection (b) would require the Secretary, no later than 
2005, commence making sales of the crude helium in the 
Cliffside Reservoir, and dispose of all such reserves by 2015, 
except for 600 million cubic feet. Such sales must be made in 
consultation with the helium industry to provide for minimum 
market disruption. This subsection ensures repayment of the 
debt.
    Subsection (c) provides that discovery of additional 
reserves shall not affect the duty of the Secretary to sell the 
crude helium in the reservoir.

Sec. 9016. Repeal of authority to borrow

    This section repeals section 12 and 15 of the Helium Act.

Sec. 9017. Reports

    This section amends section 16 of the Helium Act by adding 
a description and requirement for fiscal reporting by the 
inspector general of the Department of the Interior. This 
financial statement shall include: a balance sheet for the 
helium operations, the statement of operations, a statement of 
cash flows, and a reconciliation of budget reports.

Sec. 9018. Land conveyance in Potter County, TX

    This section directs the Secretary of the Interior to 
transfer a parcel of land to the Texas Plains Girl Scout 
Council for consideration of $1 reserving the right for 
pipeline rights-of-way easements. The section includes a 
description of the parcel of land in Potter County, TX.

                      subtitle b--water and power

                Part 1--Power Marketing Administrations

Sec. 9201. Short title

    This section provides the short title for this part, the 
Power Administration Act.

Sec. 9202. Sale of Southeastern Power Administration

    Under section 9202, the Secretary of Energy is authorized 
to sell the Southeastern Power Administration [SEPA] and the 
facilities used to generate the electric power marketed by 
SEPA.
    The SEPA facilities to be sold under this proposal include 
both the generation facilities and the related dams and rights-
of-way and structures. While the SEPA-related dam projects are 
multipurpose projects providing services in addition to power, 
such as navigation, flood control, and irrigation, there is no 
reason to doubt that private utilities, current municipal or 
cooperatively owned customers, or other non-Federal parties 
could perform these functions. In fact, both private and public 
entities are currently licensed by the Federal Energy 
Regulatory Commission [FERC] to operate 2,148 hydroelectric 
projects. Those projects are licensed and regulated to ensure 
the comprehensive development of a particular waterway 
consistent with national environmental, navigational and safety 
goals. Private and public utilities that obtain the right to 
manage the SEPA-related Federal dams would have to operate the 
assets consistent with existing Federal operating plans. In 
addition, they would comply with existing regulatory authority 
that would otherwise govern such facilities in the hands of 
non-Federal parties (e.g., Army Corps of Engineers regulations 
over navigation, and any other applicable State and Federal 
laws). Moreover, a purchaser would be required to assume 
responsibility for all contracts, marketing agreements and 
obligations held or owned by SEPA or other Federal agencies 
currently holding rights or obligations in facilities which are 
the subject of the transfer under this part.
    Subsection (a) requires the Secretary of Energy to sell 
SEPA and the facilities used to generate the electric power 
marketed by SEPA. The subsection sets up a process for the sale 
of the assets in a manner that will assure that the SEPA-
related facilities are transferred in a manner that provides 
reasonable payment to the United States. The Secretary's 
discretion to award the purchase of a facility is limited by 
four conditions: First, The purchaser must be financially 
qualified and have the experience and resources necessary to 
operate the projects as transferred; second, the purchaser must 
offer a bid package that upon evaluation yields the highest 
total value to the Federal Government; third, the purchaser 
must pay at least the net present value of the outstanding debt 
attributable to the facility or group of facilities; and 
fourth, the purchaser must agree to accept the existing rights 
and obligations while maintaining existing operating criteria. 
The subsection also specifies that the sales are subject to 
existing storage rights in the reservoirs that are to be sold. 
Local interests which have those rights will not be required to 
enter into additional contracts to continue utilizing those 
rights. During the course of the transfers it may be 
appropriate for the parties to existing contracts to enter into 
assignment agreements to document the transfers.
    Under subsection (b), the Secretary is authorized to 
request the assistance of any affected Federal department or 
agency in implementing the sale of the SEPA-related facilities. 
Relevant agencies are also required, at the appropriate time, 
to transfer the facilities to the Secretary for purposes of 
completing the sale to the highest bidder.
    Subsection (c)(1) authorizes the Secretary to hire an 
impartial advisor to assist in the sale process.
    To help ensure the marketability of the SEPA-related 
assets, subsection (c)(2) requires the Secretary to publish a 
notice in the Federal Register requesting that all parties with 
operational or ownership interests in SEPA facilities provide 
evidence of that interest within 90 days of publication of the 
notice.
    Under subsection (c)(3) the advisor is required to provide, 
among other things, a report that outlines specific plans for 
conducting a competitive bid solicitation. The advisor is 
required to provide the Secretary with a 50-year projection of 
the net present value of the income and expenses associated 
with each facility. The financial advisor also may recommend 
appropriate groupings of SEPA-related assets for purposes of 
soliciting bids on one or more projects. SEPA is currently 
divided into four separate power systems, which may provide the 
basis for four separate bids. Alternatively, the advisor may 
recommend instead that the Secretary sell the SEPA assets based 
upon grouping assets that are situated along a single river 
basin (e.g., the Savannah River basin).
    Subsection (d) authorizes the Secretary to spend up to $6 
million from unobligated balances to fund the various SEPA 
sales and PMA studies. The Secretary is to provide an 
accounting of the costs of the effort to the Committee on 
Resources in the House and the Committee on Energy and Natural 
Resources in the Senate. The net proceeds from sales of 
facilities are to be used, in part, to repay this $6 million. 
All remaining proceeds are to be used to extinguish the 
outstanding debt attributable to the sold facility or group of 
facilities. After satisfying those repayment obligations, any 
remaining proceeds are to be deposited in the Treasury of the 
United States as miscellaneous receipts.
    Subsection (e) (1) and (2) provides that the sales of these 
assets are not be to considered disposals of Federal surplus 
property under the Federal Property and Administrative Services 
Act or the Surplus Property Act of 1944.
    To meet the reasonable expectations of current preference 
customers and others affected by the operation of these 
facilities, subsection (f) provides that the purchaser of each 
SEPA facility is required to assume all liabilities and 
obligations of the United States under all contracts or other 
agreements that concern SEPA. The act does not interfere with 
the existing contracts and marketing agreements established by 
SEPA at the time of the sale. To avoid the possibility of 
action being taken by SEPA during the period between enactment 
of the legislation and the sale that would decrease the value 
of the sale, SEPA is directed not to enter into any long-term 
agreements prior to the sale.
    To ensure the marketability of the SEPA-related assets, the 
Federal Government is required to conclude existing lawsuits 
associated with the assets being sold. The Federal Government 
also will remain responsible for any outstanding Indian trust 
responsibilities unless the transfer in question specifically 
identifies the obligation being transferred.
    Under subsection (g), by June 30, 1997, the Secretary is 
required to provide to FERC a description of all the assets to 
be sold, the existing terms of operation at the facilities to 
be sold, any other interest being proposed for sale, and other 
information relating to the hydroelectric projects. All of this 
information will help FERC determine, for purposes of FERC 
regulation, the ``existing terms of operation'' at SEPA-related 
dams.
    Subsection (h) requires the Secretary to publish a Federal 
Register notice by March 31, 1998, listing a description of all 
the assets to be sold, the terms of the proposed FERC license, 
the existing terms of operation at the facilities to be sold, 
and any other interests being proposed for sale as well as 
providing the date, time and conditions to be met for the 
successful bid.
    Subsection (i) requires that the Secretary conclude all 
sales not earlier than July 1, 1999, and not later than 
September 30, 1999.
    Subsection (j) provides that after the sale of all the 
power generating facilities and related properties, the 
Secretary must complete the business of and close out SEPA. The 
Secretary is instructed to return any unexpended balance of 
funds appropriated for SEPA to the Treasury of the United 
States. To the extent practical and consistent with good 
business practices, the former employees of SEPA may be offered 
employment by the purchasers of SEPA-related facilities.

Sec. 9203. The Federal Energy Regulatory Commission jurisdiction

    Subsection (a) of section 9203 creates a system in which 
certain preference power customers will be protected from rate 
increases as the result of the sale of SEPA facilities. The 
subsection applies part 2 of the Federal Power Act to all rates 
and charges established for the wholesale sale of electric 
power and for transmission access for facilities sold under 
section 9202. This subsection will take effect after the 
expiration of any existing contract. In regulating the rates 
and charges for the sale of electricity from the transferred 
facilities, the FERC must determine whether any rate increase 
is attributable to the sale of the facility. FERC must then 
disallow any rate increase attributable to the sale that is 
more than one half of the increase in the consumer price index 
for that region (as measured from the rates and charges in 
effect on the date of the sale of the facility). The rate 
provisions in subsection (a) apply to all wholesale purchasers 
who received at least 20 percent of their power from SEPA in 
the year before this part is enacted.
    This subsection requires FERC to provide to the Secretary, 
prior to January 1, 1998, a proposed license for each Federal 
hydroelectric project sold under section 9202. It also sets a 
September 30, 1999, deadline for FERC to issue such license to 
the purchaser of the facility. The subsection further provides 
that the license, which is considered a license under part 1 of 
the Federal Power Act, shall be for a term of 30 years.
    Under subsection (b), the responsibility for regulation of 
transferred hydroelectric projects is immediately transferred 
to FERC. This immediate transfer of regulatory authority 
prevents any possible gaps in regulation.
    Subsection (b)(1) provides that the license issued by FERC 
shall be for the project purposes established by the existing 
terms of operation and in form mirrors the proposed license 
published as part of the bid package for the sale of the 
assets. By requiring FERC to include these existing terms of 
operations in the license, this part will ensure that the 
project's historical operations are continued throughout the 30 
year license term.
    Subsection (b)(2) requires that the licensed project be 
operated in accordance with the ``existing terms of 
operations'' as provided above, except that the licensee may, 
without obtaining a license amendment from FERC, make 
improvements at the project that increase energy capacity, 
provided that the change does not affect the project's existing 
minimum flow.
    Subsection (b)(3) requires that the license be subject to 
FERC's ``L-Form'' articles, which are standard articles 
included in virtually every license issued by FERC. This 
subsection also prevents the license from being ``reopened'' 
during the first 10 years of the license term. This limitation 
will provide assurances to the licensee and investors that 
excessive changes will not be made in project operations or 
project works immediately following license issuance.
    Subsection (b)(4) provides that the licensee has a 10-year 
period in which to make any changes that may be necessary to 
modify the facilities to meet FERC's dam safety regulations. 
During the first 10 years of the license term, the licensee 
must maintain at least the existing safety of dams standards as 
it transitions the facility to FERC standards.
    Subsection (b)(5) expressly exempts FERC's initial license 
issuance from various sections of the Federal Power Act, 
including but not limited to, the rights of Indian tribes and 
Federal land management agencies to impose mandatory conditions 
on licenses; the right of the Corps of Engineers to approve 
structures affecting navigation; FERC's obligation to conduct a 
navigation study of the project; and FERC's obligation to 
balance the project's power and nonpower benefits. The purpose 
of these exemptions is to reflect that these are Federal 
facilities with existing obligations which will be maintained.
    Subsection (b)(6) provides valuable protection for the 
environment by ensuring that the project's current minimum flow 
restrictions will be met throughout the license term.
    Subsection (c) expressly exempts the initial license 
issuance from the various other Federal statutes, since the 
transfer is designated to provide certainty and maintain 
existing contracts and operational requirements. The operation, 
as contrasted from the issuance, would be subject to applicable 
Federal and State regulations.
    Subsection (d)(1) provides that a license issued by FERC 
under this section shall be deemed to meet the Federal Power 
Act's licensing standards.
    Subsection (d)(2) provides that once a transferred project 
receives its license, the project owner is not required to 
obtain permits, authorizations or approvals from any other 
agency with respect to project operations. This provision 
reaffirms the principle that FERC has the sole and exclusive 
licensing authority for non-Federal hydropower.
    Subsection (e) provides that any lands whether federally or 
privately owned that are included within the final project 
boundaries of the transferred hydroelectric project, shall upon 
the issuance of a license for such a project, be free of any 
power site reservation restrictions, whether the reservations 
were established by the President, the Department of the 
Interior or pursuant to section 24 of the Federal Power Act (16 
U.S.C. 818).
    The subsection provides that at the expiration of the 
license issued by FERC for a transferred project, the project 
shall be subject to all provisions of part 1 of the Federal 
Power Act for purposes of relicensing. In other words, at 
relicensing, the project is subject to FERC's comprehensive 
licensing scheme without any waivers and exemptions.
    Subsection (g) enumerates several terms for definitions for 
the purposes of this section.

Sec. 9204. Evaluation of sales of Southwestern Power Administration and 
        Western Area Power Administration facilities

    Section (a) repeals section 505 of the Energy and Water 
Development Appropriations Act of 1993 (Public Law 102-377) 
enabling the Secretary of Energy or other Federal entities to 
initiate the Federal studies that are the subject of this 
section.
    The Secretary of Energy and the Secretary of the Interior 
are authorized by subsection (b) to enter into an arrangement 
with an experienced private sector firm to serve as an advisor 
for the purpose of evaluating the sale of the facilities 
related to the electric generating and transmitting facilities 
of Southwestern Power Administration [SWPA] and Western Area 
Power Administration [WAPA].
    The committee expects that the Department will conduct a 
full and fair competition in the selection of a financial 
advisor to perform the study of WAPA. The committee believes 
that it is essential that the financial advisor have experience 
or expertise in the areas of electric utility restructuring, 
electric utility mergers and acquisitions, privatization of 
government assets, and knowledge of both the publicly owned and 
the investor-owned utility industry. The advisor should also 
have sufficient expertise in the nonelectrical aspects of the 
study to be able to appropriately incorporate such data. The 
committee expects that the Department publish for review and 
comment a draft scope of work for the study as well as the 
proposed qualification and evaluation criteria to be applied in 
the selection of the financial advisor, prior to issuing a 
formal request for proposals.
    The advisor must provide, before December 31, 1966, a 
report identifying all recipients of water and power from these 
facilities. The advisor also will identify all contracts, debt 
obligations, equity interests, and binding agreements as well 
as all tangible and intangible assets of SWPA and WAPA.
    In the report, the advisor is instructed to address the 
applicable requirements relating to environmental mitigation 
and Indian trust responsibilities, and land ownership or use 
rights relevant to the proposed transfers that could terminate 
based on a transfer out of Federal ownership. Navigational 
requirements, which affect the operation of such facilities are 
also to be addressed.
    With respect to the evaluation of SWPA and WAPA, the 
advisor is directed to consider the tax consequences, and the 
revenue impacts of those consequences, that would flow from the 
sale of the facilities to various potential public and private 
transferees. The advisor is directed to provide sales groupings 
based on river systems or projects unless a more attractive 
alternative can be found.
    In conducting such an evaluation the Secretaries and the 
advisor should recognize that many of the dams and reservoirs 
used to generate the electric power marketed by SWPA and WAPA 
are first and foremost water supply and flood control projects. 
In general, power generation is incidental to these primary 
purposes. It is the intent of the committee that such 
facilities will continue to be operated in a manner consistent 
with their current, primary purposes and the evaluation 
directed by this section shall not assume any changes in the 
current operation of the facilities.
    Further, it is the intent of the committee that the 
evaluation recognize that power generated by such facilities is 
often intended by the authorizing legislation to first be used 
to accomplish the project uses (which uses may increase or 
decrease in the future) and secondarily for the surplus power 
to be sold. The evaluation required by this section shall in no 
way assume an alteration, diminution, or impairment in the 
priority purposes for which these projects were constructed or 
to assume any reduction in the commitment of project power to 
project uses. Such evaluation shall assume that all facilities 
used in whole or in part for the storage or delivery of water 
will continue to be used for such. The evaluation should take 
into account that the water portion of many of these projects 
are based on statutes which contemplate the transfer of those 
facilities to the water users upon completion of their 
repayment obligation.
    The study should recognize that water users in some project 
areas may wish to acquire the water storage and delivery 
portion of these facilities either independent of or in 
cooperation with other parties. It is contemplated by the 
committee that not all of the assets under evaluation will be 
authorized for sale at the same time and that some assets may 
be authorized for sale prior to the completion of the report. 
The evaluation should assume that those portions of the 
facilities used in whole or in part for the storage or delivery 
of water will not be sold to prospective buyers of SWPA or WAPA 
facilities without the consent of the water beneficiaries 
entitled to purchase them and that such facilities will 
continue to be owned by the Federal Government or its 
successor(s). It is the committee's intent that nothing in the 
evaluation or implementation of this part should be construed 
as limiting or discouraging the transfer of any water storage 
and delivery facilities independent of this evaluation or 
during the preparation of this evaluation.
    It is the intent of the committee in adopting the final 
sentence of section 9204, ``Asset groupings shall specifically 
be designed to effectuate the maximum return for all of the 
assets'' to provide guidance to the Secretaries to look at 
groupings that will encourage transfer of all facilities and to 
discourage the transfer of merely the most financially 
attractive ones. It was not the intent of the committee to 
authorize the Secretaries to evaluate or propose transfer 
criteria for the water storage and delivery portions of the 
facilities at prices exceeding that already identified in 
existing law. Nothing in this section is intended to either 
authorize or direct the Secretaries of Energy or Interior to 
study, evaluate or estimate the value for sale of any asset or 
portion of facility used in whole or in part for the delivery 
of water. The focus of the evaluation is to identify existing 
uses, proper groupings and transfer alternatives rather than to 
establish values for the facilities or to conduct appraisals of 
the assets.
    The protection of individual water rights is of paramount 
importance. Any evaluation of existing uses or proper groupings 
of facilities used in whole or in part for the storage and 
delivery of water should ensure that these delicate water 
allocations are not altered by any future transfer.
    In developing the scope of work for the advisor and 
supervising the report of the advisor, it is expected that each 
Secretary shall ensure that the issues within their respective 
areas of jurisdiction are addressed. It is the intent of the 
committee that the Secretary of Interior is primarily 
responsible for working with the advisor on those aspects of 
the report that relate to the use of any asset in whole or in 
part for the storage and delivery of water.
    The committee understands that there are several 
differences between the Power Marketing Administrations. For 
example, in the West, in many projects power users are required 
to repay a significant portion of the capital costs of 
irrigation under a program known as Aid to Irrigation. The WAPA 
system is also more complex by virtue of its size and 
geographic diversity.
    The transmission systems owned by SWPA and WAPA are 
integrated with facilities and distribution lines built by 
customers. To be effectively privatized, it may be appropriate 
to transfer these facilities separate from the generation 
facilities. Recommendations for asset sales should be 
structured to ensure continued access by customers to those 
transmission systems.
    The committee expects the evaluation to address the issue 
of transmission access, and options for how the PMA 
transmission system could be operated under various 
restructuring proposals. This would include the open 
transmission access issues that are currently under 
consideration by FERC, and also the feasibility of operating 
the PMA transmission system as a regional transmission pool.
    In investigating alternative groupings of the PMA 
facilities for purposes of sale, the advisor should consider 
the potential contribution of the PMA's, and of their 
facilities, to one or more State or regional power pools, and 
should consider groupings of PMA facilities for sale in a 
manner that could support the formation of efficient State or 
regional power pooling arrangements.

Sec. 9205. Bonneville Power Administration Appropriations Refinancing

    Subsection (a) defines the various terms used in the 
section, including:
          Paragraph (2) clarifies the repayment obligations to 
        be affected under this subtitle by defining ``capital 
        investment'' to mean a capitalized cost funded by a 
        Federal appropriation for a project, facility or 
        separable unit or feature of a project or facility, 
        provided that the investment is one for which the 
        Administrator of the Bonneville Power Administration 
        [BPA] is required by law to establish rates to repay to 
        the U.S. Treasury. Excluded from the definition are 
        Federal irrigation investments required by law to be 
        repaid by the Administrator, and investments financed 
        by BPA current revenues or by bonds issued and sold, or 
        authorized to be issued and sold, under section 13 of 
        the Federal Columbia River Transmission System Act.
          Paragraph (4) defines those capital investments whose 
        principal amounts are reset by the section. ``Old 
        capital investments'' are capital investments whose 
        capitalized costs were incurred but not repaid before 
        October 1, 1995, provided that the related project, 
        facility or separable unit or feature was placed in 
        service before October 1, 1995.
          Paragraph (5) defines the term ``repayment date'' to 
        mean the end of the period within which the 
        Administrator's rates are to assure the repayment of 
        the principal amount of a capital investment.
          Paragraph (6) defines the term ``Treasury rate.'' The 
        term is used to establish both the discount rates for 
        determining the present value of the old capital 
        investments and the interest rate that will apply to 
        the new principal amounts of the old capital 
        investments.
    Subsection (b) establishes new principal amounts of the old 
capital investments, which the Administrator is obligated by 
law to establish rates to repay. In general, the new principal 
amount associated with each such investment is determined 
(regardless of whether the obligation is for the transmission 
or generation function of the Federal Columbia River Power 
System) by: (a) Calculating the present value of the stream of 
principal and interest payments on the investment that the 
Administrator would have paid to the U.S. Treasury absent this 
section; and (b) adding to the principal of each investment a 
pro rata portion of $100 million. The new principal amount is 
established on a one-time-only basis. Although the new 
principal amounts become effective on October 1, 1995, the 
actual calculation of the reset principal will not occur until 
after October 1, 1995, because the discount rate will not be 
determined, and BPA's final audited financial statements will 
not become available, until later in that fiscal year.
    Subsection (b)(2) provides that with the approval of the 
Secretary of the Treasury based solely on consistency with this 
section, the Administrator shall determine the new principal 
amounts under subsection (b) and the assignment of interest 
rates to the new principal amounts under subsection (c).
    Subsection (c) provides that the unpaid balance of the new 
principal amount of each old capital investment shall bear 
interest at the Treasury rate for the old capital investment, 
as determined by the Secretary of the Treasury under subsection 
(a)(6). The unpaid balance of each new principal amount shall 
bear interest at that rate until the earlier of the date the 
principal is repaid or the repayment date for the investment.
    Subsection (d) provides that the end of the repayment 
period for each new principal amount established for an old 
capital investment shall be no earlier than the repayment date 
for the old capital investment assumed in subsection (b)(3)(A). 
Under existing law, the Administrator is obligated to establish 
rates to repay capital investments within a reasonable number 
of years. This subsection confirms that the Administrator 
retains this obligation notwithstanding the enactment of this 
section.
    Subsection (e) places a cap on the Administrator's 
authority to repay the new principal amounts of old capital 
investments. During the period October 1, 1995, through 
September 30, 2000, the Administrator may pay the new principal 
amounts of old capital investments before their respective 
repayment dates provided that the total of the prepayments 
during the period does not exceed $100 million.
    Subsection (f) establishes in statute a key element of the 
repayment practices relating to new capital investments. The 
subsection provides the interest rates for determining the 
interest during construction of these facilities. The 
subsection further provides that amounts for interest during 
construction shall be included in the principal amount of a new 
capital investment. Thus, the Administrator's obligation with 
respect to the payment of this interest arises when 
construction is complete, at which point the interest during 
construction is included in the principal amount of the capital 
investment.
    Subsection (g) establishes an important component of BPA's 
repayment practice, that is, the methodology for determining 
the interest rates for new capital investments. Heretofore, 
administrative policies and practice established the interest 
rates applicable to capital investments as a long-term Treasury 
interest rate in effect at the time construction commenced on 
the related facilities. By contrast, this subsection provides 
that the interest rate assigned to capital investments made in 
a project, facility or separable unit or feature of a project 
or facility, provided it is placed in service after September 
30, 1995, is a rate that more accurately reflects the repayment 
period for the capital investment and interest rates at the 
time the related facility is placed in service. The interest 
rate applicable to these capital investments is the Treasury 
rate, as defined in subsection (a)(6)(B). Each of these 
investments would bear interest at the rate so assigned until 
the earlier of the date it is repaid or the end of its 
repayment period.
    Subsection (h) provides specific credits against amounts 
otherwise payable by the Administrator to the U.S. Treasury for 
a portion of the funds the Administrator is obligated to pay 
the Confederated Tribes of the Colville Reservation so long as 
Grand Coulee Dam produces electric power.
    Subsection (i) is intended to capture in contract the 
purpose of this legislation to permanently resolve issues 
relating to the repayment obligations of BPA's customers 
associated with an old capital investment. The subsection 
requires that the Administrator offer to include in power and 
transmission contracts terms that prevent the Administrator 
from recovering and returning to the U.S. Treasury any return 
of the capital investments other than the interest payments or 
principal repayment authorized by this section.
    Subsection (i)(1) also provides assurance to ratepayers 
that outstanding principal and interest associated with each 
old capital investment, the principal of which is reset in this 
legislation, shall be credited in the amount of any payment in 
satisfaction thereof at the time the payment is tendered.
    Whereas subsection (i)(1) limits the return to the U.S. 
Treasury of the Federal investments in the designated projects 
and facilities, together with interest thereon, subsection 
(i)(2) requires the Administrator to offer to include in 
contracts terms that prevent the Administrator from recovering 
and returning to the U.S. Treasury any additional return on 
those old capital investments. It also contractually fixes the 
interest obligation on the new principal obligation at the 
amount determined pursuant to subsection (c) of this section.
    Subsection (i)(3) is intended to assure BPA ratepayers that 
the contract provisions described in subsections (i)(1) and 
(i)(2) are not indirectly circumvented by requiring BPA 
ratepayers to bear through BPA rates the cost of a judgment or 
settlement for breach of contract provisions. This subsection 
confirms that the judgment fund shall be available to pay, and 
shall be the sole source for payment of, a judgment against or 
settlement by the Administrator or the United States on a claim 
for a violation of the contract provisions required by this 
section.
    Subsection (i)(4)(a) establishes that the contract 
protections required by the section to not extend to 
Bonneville's recovering a tax that is generally applicable to 
electric utilities, whether the recovery by Bonneville is made 
through its rates or by other means.
    Subsection (i)(4)(B) clarifies that the contract terms 
described in this subsection are in no way intended to alter 
the Administrator's current rate design discretion or 
ratemaking authority to recover other costs or allocate costs 
and benefits.
    Paragraph (1) of subsection (j) assures that the principal 
and interest payments by the Administrator as established in 
this section shall be paid only from the Administrator's new 
proceeds.
    Subsection (j)(2) confirms that the Administrator may repay 
all or a portion of the principal associated with a capital 
investment before the end of its repayment period, except as 
limited by subsection (e) of this section.
    Subsection (k)(1) states that the Administrator shall 
undertake a study to determine the effect that increases in the 
rates for electric power sales made by the Administrator may 
have on the customer base of the BPA.
    Subsection (k)(2) states that the Administrator shall 
undertake a study to determine the total prior costs and the 
anticipated future costs to BPA for compliance with the 
provisions of the Endangered Species Act.
    Subsection (k)(3) requires the Administrator to submit the 
results of these studies to the Congress within 180 days of 
enactment.

                          Part 2--Reclamation

Sec. 9211. Prepayment of certain repayment contracts between the United 
        States and the Central Utah Water Conservancy District

    This section amends section 210 of the Central Utah Project 
Completion Act to extend the preexisting authority of the 
Secretary of the Interior to accept prepayment from the Central 
Utah Water Conservancy District for municipal and industrial 
repayment contracts entered into on December 28, 1965, and 
supplemented on November 26, 1985. The section provides that 
prepayment be allowed on the same terms and conditions that 
were negotiated in the Jordan Aqueduct Prepayment Agreement, 
dated October 28, 1993. It stipulates the district shall 
exercise its right to repayment under this section by the end 
of fiscal year 2002. This section does nothing with respect to 
title to the water project features for which prepayment is 
made. Title will remain in the name of the United States.

Sec. 9212. Treatment of city of Folsom as a Central Valley Project 
        contractor

    The purpose of section 9212 is to deem that, for the 
purposes of being considered eligible to be a transferee of 
Central Valley Project water to be used for municipal and 
industrial purposes, the city of Folsom, CA, shall be treated 
as a Central Valley Project contractor as of November 1, 1990.

Sec. 9213. Sly Park

    Section 9213 provides for the sale and conveyance by the 
Secretary of the Interior of the Sly Park Unit of the Central 
Valley Project to the El Dorado Irrigation District, 
Placerville, El Dorado County, CA. This section directs the 
Secretary, within 1 year of enactment, to sell and convey the 
facilities, and to transfer and assign the water rights 
relating to the unit which are held in trust by the Secretary, 
to the El Dorado Irrigation District.
    The sale price shall not exceed the construction costs, 
plus interest, minus all revenues collected under the terms of 
the contract between the United States and the El Dorado 
Irrigation District. Payment of the purchase price is to be 
made on terms not to exceed 20 years. However, transfer of 
title to the facilities will occur upon the signing of an 
agreement to carry out the sale. The section further stipulates 
that since only the ownership, not the operation, of the 
facilities to expected to change, the sale of these facilities 
does not constitute a major Federal action subject to 
environmental review pursuant to the National Environmental 
Policy Act or require a section 7 consultation under the 
Endangered Species Act.

Sec. 9214. Hetch Hetchy Dam

    Section 9214 would increase from $30,000 to $8 million the 
annual payment made by the city of San Francisco under the 
provisions of the Raker Act (act of December 13, 1913) for 
having the Hetch Hetchy system within Yosemite National Park.
    The section further stipulates that these receipts shall be 
placed in a separate fund by the United States. The fund would 
be subject to further appropriations, but the highest priority 
for use of the funds is for the annual operation of Yosemite 
National Park, with the remainder of any funds to be used to 
fund operations of other national parks in California.

         subtitle c--national parks, forests, and public lands

                       Part 1--Concession Reform

Sec. 9301. Short title

    This section provides the short title of the part, the 
Visitor Facilities and Services Enhancement Act of 1995.

Sec. 9302. Purpose

    This section outlines the purposes of the bill. The 
committee intends for Federal lands to be used and enjoyed by 
the recreating public. However, the committee recognizes that 
Federal funding is inadequate to ensure development of 
necessary public facilities to provide for public use, as well 
as the fact that there are many visitor-related functions on 
Federal lands which should be performed by the private sector. 
This legislation is designed to encourage private sector 
participation in providing for public use of Federal lands.
    The committee is concerned about the inconsistent and 
inefficient process for administering concessions adopted by 
each of the six different Federal agencies covered under this 
legislation: The National Park Service, Forest Service, Bureau 
of Land Management, Bureau of Reclamation, Corps of Engineers, 
and Fish and Wildlife Service. There is no justification for 
these policy differences which often result in increased costs 
for the concessions, decreased competition for concession 
opportunities, reduced revenue to the Government and ultimately 
a decreased level of service to the public. However, the bill 
only addresses the administrative aspect of the concession 
program and has no impact on the underlying agency mission with 
regard to concession operations. The various agencies covered 
under this bill will still utilize their unique planning 
processes to determine the location and nature of any 
concession opportunities to be offered.

Sec. 9303. Definitions

    This section defines the terms used in the legislation.

Sec. 9304. Nature and types of concession authorizations

    This section identifies the two types of concession 
authorizations which would be established under the 
legislation--a concession service agreement and a concession 
license. The basic difference between the two types of 
authorizations relates to whether the Secretary determines it 
necessary to limit the number of concessioners and to undertake 
a competitive process to select the concessioner. A concession 
license would be issued whenever the Secretary determines there 
is no need to limit the number of concessions. A concession 
service agreement would be issued whenever the Secretary 
determines there is a need to limit the number of concessions 
through competitive process.
    This part does authorize the noncompetitive award of 
concession service agreements under special circumstances. For 
example, if the Secretary acquires an existing business under 
his land acquisition program, the Secretary may determine that 
continuation of that business is in the public interest. The 
committee expects that this authority will be used on extremely 
rare occasions.
    This part provides for the issuance of a lease wherever the 
concessioner develops or uses fixed facilities on Federal 
lands. The committee adopted this approach since a lease is a 
commonly understood term and the committee anticipates such 
leasehold interest will be helpful in securing financing for 
necessary capital improvements.
    Concession licenses would be issued whenever the 
Secretaries determine that there is no need to limit the number 
of concessioners. The committee has included language directing 
the Secretaries to consider issuing concession licenses 
whenever such services would improve public enjoyment of 
Federal lands. Similarly, language has been included directing 
the Secretaries to monitor concession licenses to determine if 
the activities are of such a nature that a concession service 
agreement would be a more appropriate authorization.
    Section (b) provides that this legislation would not apply 
to recreation areas leased to other political subdivisions. 
This language would apply primarily to areas administered by 
the Corps of Engineers and Bureau of Reclamation which have 
both entered into a number of leases for properties under their 
jurisdiction.

Sec. 9305. Competitive selection process for concession service 
        agreements

    This section outlines the competitive selection process to 
be used for concession service agreements. The purpose of this 
selection process is to ensure that the Federal Government 
selects the best concessioner to provide visitor services to 
the public.
    Subsection (c) outlines the factors which the Secretaries 
shall consider in selecting the best proposal. In addition to 
the factors listed, the Secretaries may consider other factors 
of importance to a particular concession service agreement. The 
committee believes that experience of the concessioner is a 
critical factor in the selection process and has therefore 
established that experience shall be a minimum of 20 percent of 
the total selection criteria. Further, the committee expects 
that where the Secretaries determine it to be warranted, this 
factor will take on greater importance. The committee has 
included a number of aspects of the experience factors which 
would warrant this greater weight, including size or scope of 
the operation, nature of technical skills required and site 
specific knowledge of the area. In this context, size or scope 
of the operation considers such issues as numbers of employees, 
number of visitors served and numbers and types of buildings 
included in the concession operation. The nature of technical 
skills refers to such activities as rock climbing, livestock 
packing, and winter camping, as well as concession operations 
which depict the traditional activities or heritage of the 
area. Site-specific knowledge of the area is important for such 
concession activities as whitewater rafting and outfitter 
services, and in particular for concessioners who serve as 
hunting guides. This part provides that the length of such 
qualifying experience will be a key in determining the score of 
any proposal submitted to the Secretaries. The committee has 
not assigned any particular weight of other factors in an 
attempt to permit the Secretaries maximum flexibility in 
designing the selection process. The committee expects that the 
Secretaries will set reasonable minimum requirements for each 
of the factors to encourage competition in the selection 
process.
    Subsection (d) authorizes the Secretaries to provide for 
reissuance and temporary extensions of concession 
authorizations without further review under the National 
Environmental Policy Act [NEPA]. The committee has found that 
NEPA has been inconsistently applied within and among the 
agencies covered under this bill. Since continuation of 
existing activities results in no charge in the nature of 
impacts on the human environment, the committee finds that 
further NEPA review is unnecessary.
    Subsection (e) permits the Secretaries to modify an 
existing concession service agreement to provide for other 
public services not envisioned at the time the original 
concession service agreement was adopted. Such minor changes to 
an existing concession service agreement will reduce 
administrative costs associated with issuing a new prospectus 
and ensure that public services are made available more 
quickly.

Sec. 9306. Concessioner evaluations

    This section outlines establishment of a program for 
concession evaluations. The committee believes that evaluations 
are a critical element of the overall concession program. 
Information supplied to the committee indicates that existing 
evaluation programs often focus on minor technical issues, and 
may not accurately reflect the overall performance of the 
concessioners. The bill provides for development of an 
evaluation program based on broad public input. The committee 
encourages the Secretaries to consult closely with the 
hospitality industry in developing this program.
    Subsection (b) provides that the Secretaries shall develop 
an annual evaluation based on at least two reviews of the 
concession operation per year. The legislation provides for 
concessioners to be notified in advance regarding such 
evaluations and to be provided copies of the evaluation program 
prior to the initiation of the evaluation period. If a 
Secretary determines that the performance of the concessioner 
is unsatisfactory, he shall notify the concessioner in writing 
and outline the steps necessary for the concessioner to achieve 
a satisfactory level of performance.
    Subsection (c) outlines the incentives which are provided 
to the concessioner for good performance. The concessioner can 
earn two types of incentives for good performance. First, those 
operators who consistently perform above the level specified in 
the contract prospectus would be entitled to an automatic 3 
year contract extension at the end of their contract. Second, 
concessioners would be entitled to a performance incentive of 1 
percent of the maximum points to be awarded in renewal of their 
concession service agreement for each year in which their 
performance exceeds requirements of the contract prospectus, 
subject to a total cap of 10 percent over the life of the 
contract. The committee strongly believe that such incentives 
are a desirable way to encourage and recognize good 
performance.

Sec. 9307. Capital improvements

    This section outlines a program designed to encourage the 
private sector to develop necessary public facilities on 
Federal lands. The committee recognizes that congressional 
appropriations are inadequate to provide the level and types of 
facilities needed for full public enjoyment of Federal lands. 
Further, the committee believes that even if lack of Federal 
appropriations were not a problem, visitor facilities will be 
better cared for, at less cost, if they remain in private 
rather than public ownership. The committee is aware that some 
believe that private ownership of such facilities per se has 
been a barrier to competition for concession contracts in the 
past. The committee did not find any evidence to support that 
conclusion. However, the fact that the value of any private 
ownership has generally been unknown at the time of contract 
renewal has made it extremely difficult for many prospective 
concessioners to develop proposals. Therefore, section 9307 
provides for the value of such facilities to be included in the 
prospectus. Under section 9307, the concessioner would only be 
permitted to construct those public facilities which are used 
directly by the concessioner, such as hotels, restaurants, 
campgrounds, or such facilities as are necessary for the 
concessioner to administer such facilities, such as employee 
housing and office space. The concessioner would not be 
authorized to construct any facilities for general 
administrative purposes.
    Subsection (b) specifies that the concessioner shall be 
entitled to an investment interest in facilities constructed 
pursuant to the concession services agreement as determined by 
the Secretaries. Such investment interest shall not have any 
impact on title to the land nor shall it imply any right to 
operate any business or other activity. No concession service 
agreement shall provide for a concessioner to develop an 
investment interest in any wholly owned Government building. 
This provision was inserted because the committee believes that 
such jointly owned buildings are not desired.
    Subsection (c) provides that if the concessioner is not 
selected at the time of the renewal of the current concession 
contract as the best concessioner, the new concessioner shall 
be required to purchase the investment interest of the 
incumbent concessioner.
    Subsection (d) establishes the method for determination of 
the value of any investment interest. The legislation provides 
that the value will be based on replacement cost, not to exceed 
fair market value. This method for determining value ensures 
that the investment interest is not increased by either the 
location of capital improvements on Federal lands, or for 
income-producing properties, to an amount greater than the 
projected revenue stream will support.

Sec. 9308. Duration of concession authorization

    This section establishes that the duration of a concession 
service agreement shall be not less that 5 years. In 
recognition of both the amount of work required for the 
Government to complete the competitive selection process and 
the need to ensure a reasonable level of certainty for the 
concessioner, the committee believes that 5 years is the 
minimum reasonable duration for a concession service agreement. 
The bill provides for a contract duration of 10 years more for 
all concession service agreements which are projected to 
generate average gross annual sales of $100,000 or more. This 
longer duration is commensurate with the level of investment 
required under such larger concession service agreements. No 
concession service agreement may be awarded for a duration 
greater than 30 years.

Sec. 9309. Rates and charges to the public

    This section outlines the policy for establishing rates and 
charges to the public. To reduce costs to the Government, this 
section permits the rates to be established by the competitive 
market to the extent reasonable. The committee finds that NPS 
has an extremely burdensome process for rate approval, while 
other agencies simply reserve the right to review prices and 
only exercise that right in limited circumstances. The 
committee believes that rates should be set by market 
conditions, when there is adequate competition. The committee 
expects that the Secretaries will jointly develop general 
criteria to assist them in the determination whether adequate 
competition exists, so that this policy is administered on a 
consistent basis. The committee expects that the solicitation 
would include the determination by the Secretaries as to which 
aspects of the concession service agreement (if any) would be 
subject to price approval. When the Secretaries make a 
determination that adequate competition does not exist, the 
Secretaries shall review price proposals taking into 
consideration unique aspects of the concession operation. The 
Secretaries shall not conduct rate approval for any concession 
license.

Sec. 9310. Transferability of concession authorization

    This section outlines the policy for transfer or sale of 
concession contracts. Secretarial approval is required for all 
sales or transfers. The Secretaries are expected to thoroughly 
review all such transfers to ensure that the successor 
concessioner will be able to fulfill terms of the concession 
service agreement and provide continuing public service. 
Further, the Secretaries shall review the terms of the sale to 
determine whether the rates charged to the public which will be 
required to support the sale will be reasonable. The 
Secretaries shall not approve any sale or transfer where they 
determine that rates to be charged to the public will not be 
reasonable. However, the Secretaries may not use the sale as an 
opportunity to change the conditions or terms of the contract, 
nor may the Secretaries unreasonably withhold approval of any 
such sale after all relevant information needed by the 
Secretaries to review the terms of the sale has been submitted 
for review.

Sec. 9311. Fees charged by the United States for concession 
        authorizations.

    This section outlines the process for determining fees to 
the United States. The committee is concerned that the lack of 
competition in existing concession agreements has been a major 
factor resulting in a return to the Government which is less 
than fair value for the privilege of providing concession 
services. The committee has adopted a process which will allow 
the market place to establish the fees to the Government to 
ensure a fair return. The legislation recognizes four different 
types of fees: First, Fees to the government for the privilege 
of providing concession services; second, amounts for any 
capital improvements; third, fees for rental of Government-
owned buildings; and fourth, expenditures for maintenance or 
improvements to Government-owned buildings. A concession 
service agreement may include any of these different types of 
fees.
    The committee expects that the Secretaries will set the 
minimum fee for each applicable category in the prospectus and 
that the final fee will be determined based on the proposal 
selected by the Secretaries. The committee does not expect the 
fee to be the most important factor in the selection process, 
but the committee believes that the fee should be established 
by market forces to the extent practicable. An exception is 
provided for similar outfitter and guide services in the same 
geographic area; when the Secretaries make such an offering, 
they shall specify a standard fee in the solicitation.
    Subsection (c) enumerates the limited conditions under 
which the concession fees may be changed. The committee 
believes that concessioners will generally be willing to offer 
a higher fee to the government if they know that fees will not 
change over the life of the contract. Therefore the language 
specifies that the only time the fees may be changed is on the 
basis of inflation (if the fee is not established as a percent 
of gross), or if there are substantial changes from the 
conditions outlined in the prospectus. As envisioned in this 
section, a substantial change would be one where a proposal 
concession facility cannot be developed because the government 
cannot provide necessary infrastructure, or where a new 
management plan reduces the proposal size of a concession 
operation. A minor change in operating conditions due to 
reduced funding levels, etc. shall not be adequate cause to 
justify altering the fees. The committee expects that changes 
in fees will occur rarely under theses conditions.

Sec. 9312. Disposition of fees

    This section covers disposition of the fees. Fees will 
either be retained for expenditure on-site or deposited in the 
Treasury as miscellaneous receipts. Fees which are for rental 
of Government buildings or which are for the privilege of 
providing concession services will be deposited into the 
Treasury, up to certain amounts; and fees for capital 
improvements and for maintenance or improvement of Government-
owned and occupied buildings will be retained on-site in a 
concession improvement account. The bill specifies strict 
accounting for all funds generated pursuant to this part, 
including a biennial review of the accounts by the relevant 
Departmental Inspector General.

Sec. 9313. Dispute resolution

    This section outlines the process for dispute resolution. 
This part provides for a combination of reviews of decisions 
within the agencies, by an independent administrative board and 
by the courts. While this part makes it clear that a concession 
service agreement is not a contract subject to the Federal 
Acquisition Regulations, it is still a contract. Therefore, it 
is appropriate that the relevant departmental board of contract 
appeals be instructed to administer certain disputes arising 
pursuant to the legislation. One area not typically reviewed by 
such a board is performance evaluations, which will be subject 
to review of the board under this section. Since evaluations 
are such an important element under this part the committee is 
convinced that substantial additional oversight of this 
activity is warranted.

Sec. 9314. Recordkeeping

    This section requires concessioners to keep adequate 
records and that the Comptroller General of the United States 
shall have access to these records.

Sec. 9315. Application of general governmental acquisition requirements

    This section makes it clear that the Federal Acquisition 
Regulations do not apply to concession service agreements or to 
concession licenses, even though they are contracts.

Sec. 9316. Rules of construction

    This section specifies that an agency's concession programs 
must be fully consistent with the agency's mission and laws 
applicable to the agency.

Sec. 9317. Regulations

    This section requires that the agencies develop regulations 
for implementation of this part. This section specifies that no 
new concession contracts can be entered into after enactment of 
this part until the such new regulations are adopted by the 
agencies. This provision will prevent agencies from awarding 
contracts under the old, noncompetitive policies while the new 
policies are being developed. This section provides a 2-year 
window for the development of these regulations, which is more 
than adequate. Each agency will develop their own regulations 
for implementation. However, the agencies are required to adopt 
uniform reporting requirements for all concessioners. The 
regulations shall also specify the qualifications necessary for 
agency personnel assigned concession management duties. The 
committee believes that the agencies need to make a concerted 
effort to hire persons with a business background, as well as 
persons with expertise in the hospitality industry to ensure 
that the concession program provides the best service to the 
public and provides a fair return to the Government.

Sec. 9318. Relationship to other existing laws

    This section provides for modifications to existing laws to 
conform to this part.
    Subsection (e) is a savings provision to ensure that 
enactment of this legislation does not affect the validity of 
any authorizations entered into prior to enactment of this 
part. For any contract with specifically includes a right of 
renewal, such renewal shall be maintained under this 
legislation. Where such right of renewal is a matter of 
existing law or practice, it is not protected under this part. 
Any attempt to do so would seriously undermine the competitive 
aspects of this part. In addition, this part does not change 
the value of existing capital improvements entered into prior 
to the enactment of this part.
    This subsection also specifies the process under which 
existing incumbent concessioners will compete at the time their 
existing concession contracts are up, should they choose to do 
so. Any concessioner whose contract has expired prior to 
enactment of this legislation, or whose contract will expire 
within 5 years after enactment of this legislation is entitled 
to receive a one-time automatic credit of 5 percent in the 
reissuance of their previous authorization. For any 
concessioner which has more than 5 years remaining on their 
contract, they will have the opportunity to earn performance 
incentives toward the renewal of their concession service 
agreement.

                   Part 2--National Forest Ski Areas

Sec. 9321. Privatization of Forest Service ski areas

    The section directs the Forest Service to offer for sale 
not less than 40 qualifying ski areas to the permittee. The 
qualifying areas are those areas which are located adjacent to 
the boundary of a forest or adjacent to other significant 
inholdings and which have capital improvements greater than $2 
million. The Secretary of Agriculture would be directed to sell 
the lands at fair market value. In addition, the Secretary is 
authorized to sell other Forest Service lands as part of the 
transaction. For example, the Secretary may sell lands adjacent 
to the ski area which could be developed for employee housing 
for the ski area. Proceeds from any such sale would be equally 
divided, so that 50 percent would be deposited into the 
Treasury as miscellaneous receipts and 50 percent would be 
retained by the Forest Service to acquire high priority tracts 
of lands as are identified in the plan for that forest.

Sec. 9322. Ski area permit fees and withdrawal of ski areas from 
        operation of mining laws

    This section provides for a new method for collecting fees 
for permits for the lease of Forest Service lands for ski 
areas. This provision would replace the existing graduated rate 
fee system [GRFS] with a new system based on a percent of the 
gross annual sales from alpine and nordic ticket sales and from 
other revenue-producing facilities on Forest Service lands. 
This provision would not apply to any ski area where the 
existing permit specifies that the fee would be determined 
under GRFS, unless agreed to by that operator. This section 
also exempts all lands under ski area permits from mineral 
location under the mining laws, subject to valid existing 
rights.

                   Part 3--Domestic Livestock Grazing

Sec. 9331. Applicable regulations

    Subsection (a) provides that grazing on lands administered 
by the Bureau of Land Management [BLM] shall be in accordance 
with part 1780 and part 4100 of title 43, Code of Federal 
Regulations as in effect on January 1, 1995.
    Subsection (b) provides that except as otherwise provided, 
grazing of domestic livestock on lands administered by the 
Forest Service shall be similar to the regulations governing 
lands administered by BLM.

Sec. 9332. Fees and charges

    Subsection (a) establishes a gross return fee formula based 
on a three-year rolling average of the gross value of 
production of livestock, as determined by the Economic Research 
Service, multiplied by the 10-year average of the U.S. Treasury 
securities 6-month Treasury bill ``new issue'' rate and divided 
by 12. For 1992, the gross value equaled $431. The 10-year 
average for the 6-month Treasury bill for the same period is 
5.99 percent. Thus, the fee would be calculated as follows: 
$431 * .0599=$25.82; $25.82/12=$2.15. The grazing fee per 
animal unit month [AUM] for 1993 would be $2.15.
    The National Agricultural Statistics Service of the 
Department of Agriculture shall make a determination of the 
gross value of production based on information gathered from 
livestock grazing operators. In addition, the subsection 
requires a subleasing charge equal to 25 percent of the 
difference between the current year's Federal grazing fee and 
the prior year's private grazing land lease rate per year of 
the appropriate State. This applies to livestock not owned by a 
permittee's spouse, son, daughter, grandson, or granddaughter.

Sec. 9333. Animal unit month

    Under subsection (a), with respect to grazing on Federal 
land in a State that charges a fee for grazing on State land 
based on a formula in which one of the factors is an animal 
unit month, the term ``animal unit month'' has the meaning 
established under State law.
    Subsection (b), for calculation of the Federal grazing fee, 
defines one AUM as one cow, bull, steer, heifer, horse, burro, 
mule, or seven sheep or goats.

Sec. 9334. Term of grazing permits or grazing leases

    Permit tenure is changed to a period of 15 years.

Sec. 9335. Conformance with land use plan

    This section amends current law to state that the issuance 
of a grazing permit and other livestock grazing activity and 
management actions with a valid land use plan under the 
National Environmental Protection Act [NEPA] are ongoing 
Government actions that do not require NEPA documentation.

Sec. 9336. Effective date

    This part shall apply to grazing on Federal lands on and 
after the date of the enactment of this part.

     Part 4--Regional Disposal Facility of Southwestern Low Level 
                   Radioactive Waste Disposal Compact

Sec. 9341. Conveyance of property

    Subsection (a) conveys all right and interest of the land 
parcel described in subsection (b) and held by the United 
States to Department of Health Services, and all necessary 
easements, upon the tendering of $500,000 and the release of 
claims of liability. This subsection also provides that the 
land revert to the United States if not used as a low level 
waste disposal facility before October 1, 2010.
    Subsection (b) provides a description by map reference of 
the land to be transferred.
    Subsection (c) requires the Secretary of Interior to issue 
evidence of title pursuant to this section, notwithstanding any 
other provision of law. It specifically provides that the Ward 
Valley disposal facility is in compliance with applicable 
sections of the National Environmental Protection Act, the 
Endangered Species Act and the Federal Land Policy Management 
Act [FLPMA], as amended. A final environmental impact 
statement/report and a final supplemental environmental impact 
statement have been issued in 1991 and 1992 respectively. Two 
biological opinions, one in 1990 and another in 1995, concluded 
that the project would not jeopardize the desert tortoise. 
Public need for the facility has been adequately demonstrated 
and the land has been classified as class M under FLPMA and 
thus is suitable for disposition.
    Subsection (d) is a self-explanatory clause describing the 
Treasury account to which sums tendered are to be deposited.
    Subsection (e) is self-explanatory.

Sec. 9342. Conveyance of easements

    Subsection (a) conveys concurrent with the conveyance of 
the land described in section 9341(b), all necessary easements 
between Interstate 40 and the land and the right to improve 
those easements. The described easements are necessary for 
access to and from the land described in section 9341(b) and 
for needed utility corridors. The subsection also provides that 
the easements revert to the United States if the land 
referenced in section 9341(b) is not used as a low radioactive 
waste disposal facility.
    Subsection (b) references a map that depicts the easements 
between Interstate 40 and the land. The legal description of 
the property subject to the easements is described in 
subsection 9342(a).

                        subtitle d--territories

          Part 1--Commonwealth of the Northern Mariana Islands

Sec. 9401. Termination of annual direct grant assistance

    The annual special grant assistance to the Northern Mariana 
Islands is terminated as of September 30, 1995. Any amounts 
previously appropriated but not obligated as of the date of 
enactment may not be obligated.

            Part 2--Territorial Administrative Cessation Act

Section 9421. Short title.

    This section provides a short title for the part, the 
Territorial Administration Cessation Act.

Sec. 9422. Congressional findings

    These congressional findings highlight the recent end of 
the United Nations Trust Territory of the Pacific Islands and 
corresponding trusteeship responsibilities of the United 
States. Also, the U.S. territories have developed progressively 
increased self-governance during the past five decades, and 
Federal-territorial relations can be enhanced and fiscal 
conditions improved by the elimination of unnecessary Federal 
bureaucracy.

Sec. 9423. Elimination of Office of Territorial and International 
        Affairs

    The Office of Territorial and International Affairs [OTIA] 
of the Department of the Interior, established by Secretarial 
Order in 1980, is eliminated. The position of Assistant 
Secretary for the OTIA is terminated by reducing the authorized 
number of assistant secretaries of the Interior from six to 
five. The provisions would take effect the first day of the 
first fiscal year following the date of enactment.

Sec. 9424. Certain activities not funded

    No further amounts may be expended for certain assistance 
programs for territories administered by the Department of the 
Interior: technical and maintenance assistance, disaster fund, 
and insular management controls.

                          subtitle e--minerals

                        Part 1--Hardrock Mining

Sec. 9501. Findings and purpose

    This section states that a secure and reliable domestic 
mineral supply is essential to the industrial base of the 
United States and that the purpose of subtitle E. part 1 is to 
provide for increased Federal revenue from mining in way which 
continues to achieve the foregoing objective by encouraging 
exploration and development of mineral deposits on public 
lands.

Sec. 9502. Patents under the general mining law

    This section requires that patents granted after enactment 
will be subject to the payment of appraised fair market value 
for the land within the boundaries of the claims. Fair market 
value would be determined without considering the value of the 
mineral estate or the value of the surface as used for mineral 
activities. A transition period of 2 years is granted for 
mining claims which owners are subsequently able to demonstrate 
were valid on the date of enactment of this part. The committee 
intends that while such claims must be supported by a discovery 
of a valuable mineral deposit within the meaning of the mining 
law, additional sampling post-enactment to confirm and 
corroborate pre-existing exposures of mineralization are 
legitimate showings in a subsequent demonstration of discovery.
    For claimants who have been denied access to their claims 
by the Federal Government during the 5-year period immediately 
prior to enactment (e.g., BLM wilderness study area 
designation) the transition period is 10 years from the 
termination of the denial of access or the date of enactment, 
whichever occurs first. Such ``grandfathered'' mineral patents 
would not contain a reservation of royalty interest to the 
United States.
    A five-year payment plan option is made available to claim 
owners grossing less than $500,000 annually. The moratorium on 
processing of mineral patent applications and issuance of 
patents contained within section 112 of Public Law 103-322, an 
act making appropriations for the Department of the Interior 
and Related Agencies for fiscal year 1995, is affirmatively 
repealed.

Sec. 9503. Royalty under the general mining law

    This section imposes a royalty of 3.5 percent upon the net 
proceeds of mines, as closely modeled on the State of Nevada's 
net proceeds tax, which has been levied for over a century. 
Deductions from gross proceeds are expressly delineated in the 
section and generally include development and production costs, 
both labor and capital, but not claim acquisition or 
exploration costs. Limitations on deductions are expressly 
delineated as well. In general, only those costs attributable 
to actual mining of the claimed deposit are deductible.
    An exemption is provided from the royalty requirement for 
claim owners with net proceeds from all hardrock mines subject 
to this section yielding less than an aggregate $50,000 
annually. Recordkeeping requirements for royalty reporting are 
left to the discretion of the Secretary, but the committee 
expects the Secretary to consult with hardrock mining industry 
financial experts during implementation of this section so as 
to build a streamlined, cost-effective royalty reporting 
system. Claim owners who unsuccessfully seek ``grandfathered'' 
patents would owe a royalty plus interest on minerals produced 
during the pendency of the patent proceedings.
    Royalty receipts would be disbursed as follows: two-thirds 
to the U.S. Treasury, and one-third directly to the State from 
which the royalty was paid. Mineral patents issued after 
enactment will reserve such royalty interest to the United 
States unless the claim owner receives a patent under the 
transition rules of section 9502.

Sec. 9504. Mineral materials

    This section prospectively eliminates all ``uncommon 
varieties'' of mineral materials as delineated in the Surface 
Resources Act of 1955 (i.e., sand, stone, gravel, pumice, 
pumicite and cinders) from location under the Mining Law and 
requires that such minerals be disposed via the Material Sales 
Act of 1947, as amended by this section. This section would 
provide for a modified Materials Sales Act of 1947 disposal of 
all such mineral materials with provisions to ensure quarry 
operators a long-term supply. A minimum charge of 2 percent of 
the gross proceeds of the mineral materials sold would be 
collected by the Government.
    The section repeals the Building Stone Placer Act of 1892 
made unnecessary by the elimination of ``stone'' from the 
operation of the general mining laws, and the Saline Placer Act 
of 1901, which effectively has been utilized since passage of 
the Mineral Leasing Act of 1920. The committee expressly notes 
that this section does not pertain to deposits of gypsum, high 
calcium/magnesium-limestone, diatomaceous earth, specialty 
clays (e.g., bentonite, kaolinite, hectorite, fuller's earth, 
sepiolite, seponite, etc.) and other minerals not delineated in 
section 3 of the Act of July 23, 1955, commonly known as the 
Surface Resources Act (30 U.S.C. section 611). These types of 
minerals have been subject to the common versus uncommon 
variety distinction delineated in the 1955 act and remain 
subject to location. Patents to mining claims located for 
uncommon varieties of mineral materials which are valid prior 
to the date of enactment may be sought under the transition 
period of section 9502.
    Subsection (i) limits the royalty rate which the Secretary 
may impose on leases for sodium compounds under section 24 of 
the Mineral Leasing Act of 1920 to not more than 5\1/2\ percent 
of the gross proceeds unless and until the Secretary, in 
consultation with the Secretary of Commerce and the U.S. Trade 
Representative, reports to Congress than an increase in royalty 
rate above such threshold will not adversely affect export of 
domestically produced soda ash. The royalty rate shall not be 
raised higher than 5\1/2\ percent until Congress approves such 
recommendation of the Secretary of the Interior. Furthermore, 
subsection (i) requires the Secretary of the Interior within 90 
days of the date to enactment to offer for competitive bid 
tracts upon which applications for sodium leases are pending. 
The committee intends the tracts within the known sodium 
leasing area [KSLA] of the Green River basin in Wyoming to be 
offered for lease at a royalty rate not more than 5\1/2\ 
percent of gross proceeds, and that existing leases in the 
Green River KSLA that have reached the end of their primary 
terms be renewed with a royalty rate not to exceed 5\1/2\ 
percent. The committee does not intend to affect the royalty 
rate on existing sodium leases outside the Green River KSLA.

Sec. 9505. Claim maintenance requirements

    This section requires payment of an annual claim 
maintenance fee which escalates with time (from $100 to $500 
annually over a period of 16 years) to deter speculative 
holding of claims by nonbona fide interests. Credit for the 
value of annual labor performed to develop one's claim(s) would 
offset not more than 75 percent of the following year's fee. 
The value of qualifying labor that exceeds the 75 percent 
threshold may be carried forward for up to three years credit 
against the claim maintenance fee obligation, subject to the 75 
percent limitation threshold. The committee expects a 
significant increase in the number of mining claims of record 
with the Bureau of Land Management, the result that many more 
claims would be located, explored, and either developed into 
mines or dropped depending upon one's assessment of mineral 
value.
    This section clarifies what activities qualify for labor 
credit and imposes a new reporting requirement (both modeled on 
Alaska regulatory practice) upon those electing to credit such 
labor performed to ensure compliance. However, the obligation 
to perform such annual labor (as was required by law from 1866 
to 1993) is not being restored in this part; therefore 
claimants may elect to pay the entire claim maintenance fee 
obligation rather than provide the records necessary to 
establish the value of annual labor sought for fee reduction 
credit.
    Royalties paid by claimholders are credited against the 
claim maintenance fee obligation of the claimholder, except for 
royalties paid in the first year after enactment.

                 Part 2--Federal Oil and Gas Royalties

Sec. 9511. Short title

    The short title of this part is the Federal Oil and Gas 
Royalty Simplification and Fairness Act of 1995.

Sec. 9512. Definitions

    Definitions are contained in this section to provide 
guidance and clarity. Many of the definitions are critical to 
the underlying concepts. Under the provisions of this part, the 
definitions apply to Federal lands and Outer Continental Shelf 
lands, and in no way shall be applied to Indian lands.
    The term ``obligation'' includes all of the duties which 
arise under a lease issued by the Federal Government. A 
``lessee'' is the person having a contractual relationship with 
the Federal Government. A ``State concerned'' is clarified to 
be the State which receives a portion of Federal royalties for 
Federal lands lying within the boundaries of the State and 
shall have an equal role with the Secretary in deciding the 
applicable provisions of this part. The term ``order to pay'' 
has been expressly defined. The committee believe that the 
information contained in this definition is necessary 
information for the tolling of the statute of limitations.
    This section provides that the lessee notify the Secretary 
who will remit royalty by clarifying who is responsible for the 
payment of royalties. The committee intends to eliminate the 
delay in collection of these royalties because the Secretary 
will contact only those parties that are liable, or designated 
to be liable, to remit royalty. The Interior Board of Land 
Appeals Mesa decision demonstrates that the Secretary's current 
royalty collection practices must be altered to comply with the 
law. This section does not reduce the Secretary's ability to 
accept payment from any party or their ability to pursue 
parties who are secondarily liable.
    This provision has no impact on the current requirements 
for reporting and paying of royalties. This provision clarifies 
which party is primarily liable for the underlying royalty 
obligation, which is consistent with lease terms. The provision 
does not alter or restrict a lessee's designation of who may 
report and pay royalties on their behalf.

Sec. 9513. Limitation periods

    The statutory limitation period is certain and is a fair 
and reasonable 6-year time period. It is reciprocal and applies 
to both lessees and the Federal Government. The establishment 
of this statute of limitation for obligations is fundamental to 
a well-ordered judicial system and is required by modern 
standards of equity and fairness. The committee intends prompt 
resolution of disputes, necessary for the orderly and fair 
administration of justice. Additionally, the limitation is 
intended to reduce the cost of keeping records and deferring 
collection of Government claims.
    The Government will be barred from asserting old and stale 
claims in court which the committee notes will require 
increased efficiency in Government claims proceedings. As a 
matter of fairness, persons dealing with the Government should 
have protection against an action by the Government which arose 
from a transaction occurring more than 6 years previously. 
Likewise, lessees are barred from asserting claims against the 
Government beyond the limitation period.
    Under this section, a judicial proceeding must be filed, 
and demands for relief must be commenced, within 6 years after 
the obligation becomes due. If not, no other action by the 
Secretary or the United States is permitted for an obligation 
for which the limitation period has ended.
    The circumstances under which the period of limitation is 
to be suspended or tolled are limited and the committee intends 
the tolling provision to be narrowly construed. The statute of 
limitation is tolled only by: First, Agreement; second, the 
issuance of a Secretarial subpoena to produce records; third, 
fraud or concealment by a lessee; fourth, a request from a 
lessee when its entitlement to an overpayment has not been 
finally determined; or fifth, the issuance of a Secretarial 
notice that a lessee has not adequately performed restructured 
accounting.
    It is the committee's intent to require that the person 
issuing the subpoena be a political appointee subject to 
confirmation by the Senate, and to prevent the solicitor from 
issuing subpoenas. The solicitor is not in a policy position, 
and should be responsible only to carry out the subpoena as 
counsel for the policymaker.
    If during the course of an in-depth audit, the Secretary 
determines that a lessee has made significant underpayments or 
overpayments based upon recurring reporting errors, the 
Secretary may issue an order to perform a restructured 
accounting within a reasonable period of time after the audit 
activity identifies the systemic reporting errors. The order 
can only be issued by the most senior career professional 
person in the Secretary's royalty management program and must 
specifically contain the enumerated items identified in this 
section.
    If the lessee fails to adequately perform the required 
accounting pursuant to the order to perform restructured 
accounting, the Secretary must issue a notice that the lessee 
has not adequately performed the accounting. This notice will 
toll the limitation period for the period beginning on the date 
the lessee receives the notice until the lessee notifies the 
Secretary the accounting has been performed or until a court 
determines the accounting is not required to be performed.
    To collect disputed royalties on a more timely basis, final 
agency decisions must be issued within 3 years. The Secretary 
and a lessee are encouraged to settle a dispute within three 
years, thereby resulting in royalties being paid sooner. To 
facilitate early settlement, a settlement consultation is 
required. The 3 years may not be extended by any agency action. 
If after 6 years from the date the obligation is due, the 
Secretary and the lessee can not settle the dispute, the 
interest rate is reduced. The reduction due the Secretary for 
underpayments will be reduced by 1 percent and the rate due the 
lessee will be reduced by 2 percent per year until resolved.
    If enforcement of an obligation is barred, the United 
States can take no further action with regard to that 
obligation. If a demand is timely commenced, judicial review is 
timely if filed within 180 days of notice of final agency 
action. Any party ordered to pay an obligation is entitled to a 
stay without bond pending administrative or judicial review, if 
that party is financially solvent. Conflicting statutes 
(including the Debt Collection Act) which circumvent and 
undercut the purpose of a statute of limitation of finality, 
certainty and fairness are expressly declared inapplicable to 
obligations covered by this part. All other statutes are to be 
applied consistently with the terms of this part.
    This section expressly provides that this part applies to 
suits brought by a State on an obligation which is subject to 
the terms of this part. The statute of limitations and other 
provisions of this part shall apply to State suits.
    This section allows for collection of a royalty payment on 
an obligation on the last day of the second calendar month 
following production. The committee intends to rectify the 
problem of a lessee being required to make a royalty payment 
without sufficient information to do so. The committee expects 
the Secretary to work with States concerned and industry 
representatives to develop an implementation schedule that will 
not significantly impact collection of royalty receipts.

Sec. 9514. Adjustment and refunds

    This section provides more efficient and cost-effective 
accounting practices for reporting, paying, and adjusting 
royalty payments. This is made necessary by the complexity of 
determining proper payment, especially in light of deregulation 
of the gas marketing industry, which has resulted in accounting 
adjustments for prior reporting months. It is in the best 
interest of the Federal Government and industry to 
expeditiously adjust royalty payments to reflect correct 
amounts of royalty obligations due. The adjustment provision 
has been established to ensure such adjustments can be reviewed 
by the Secretary after the fifth year, yet before the 
expiration of the limitations period.
    Lessees are granted 5 years to make adjustments or request 
refunds to correct an underpayment or overpayment of an 
obligation. However, this 5-year period shall be extended if 
the limitations period in section 9513 of this part is tolled. 
Each adjustment is to be made on a lease-by-lease basis on the 
royalty report and will serve as sufficient notice to the 
Secretary. In order to give the Secretary a reasonable time 
period (1 year) to audit any adjustments made to an obligation, 
the adjustments or requests for refund may only be made outside 
the 5-year period, and only up to 6 years from the date the 
obligation was due, because the production month of the 
adjustment must be under audit by the Secretary, and the 
Secretary must authorize the adjustment. The Secretary must 
allow the adjustment to be offset against any audit findings on 
any obligation for that lessee (or designee).
    To accelerate interest revenue due the Federal Government 
and to simplify and reduce costs associated with the Minerals 
Management Service's [MMS] interest processing model, a lessee 
(or designee) is required to calculate and pay interest due for 
overpayments and underpayments as a separate line item on the 
royalty remittance report. This line item is reported at the 
same time an adjustment to an obligation is made, unless 
determined by the Secretary to be a hardship case. Hardship is 
defined by the Secretary based on payment levels. For payers 
below the payment threshold, the Secretary shall calculate 
interest due and notify the lessee. Lessees subject to the 
hardship classification can elect to calculate and report their 
own interest obligation.
    Pursuant to this part, refunds are permitted where a lessee 
(or designee) may not be able to make an adjustment to their 
royalty report. These situations include sale of the lease 
between the time the original obligation was paid and an 
adjustment became known. These requests must provide enough 
detail for the Secretary to identify the overpayment and 
reasons for the request. In order to expedite claims, and to 
reduce interest costs to the Government, requests for refunds 
must be paid or denied by the Secretary within 120 days of 
receipt of the refund request. The request, if granted, will be 
subject to audit pursuant to other provisions of this part.
    The Secretary of the Treasury is authorized and directed to 
make proper refund payments to be paid from receipts received 
under the Mineral Leasing Act and the Outer Continental Shelf 
Lands Act to be proportionally deducted from amounts disbursed 
to the States or the reclamation fund.

Sec. 9515. Required recordkeeping

    The purpose of the required recordkeeping provision is to 
conform a lessee's record keeping requirement to the statute of 
limitations. The lessee shall maintain records for an 
obligation within the 6-year limitations period but is not 
required to keep or provide records beyond the 6-year period. 
This provision was needed in response to recent court decisions 
and the burden of indefinite records retention.

Sec. 9516. Royalty interest, penalties, and payments

    Interest is allowed and will accrue on overpayments from 
the date that the overpayment was made, effective either 6 
months after date of enactment of this part or September 1, 
1996, whichever is later. Because of the requirement that the 
royalty obligation be paid monthly, paying interest from the 
date the overpayment is made retains symmetry in the monthly 
accounting process. The Secretary has discretion to issue 
interest bills for deminimus amounts of interest if the cost to 
collect the interest exceeds the cost collected.
    Today many royalty payments made to MMS are initially based 
on estimated volumes and values as opposed to actual volumes 
and values because of the inherent marketing complexities of 
the oil and gas industry and the complexities associated with 
determining proper valuation. These complexities are primarily 
related to Federal Energy Regulatory Commission's deregulation 
of the gas business, thereby making it almost impossible for 
industry, within the date the royalty obligation is due, to 
ascertain the correct value on which royalty is due.
    In order to comply with current MMS practices, industry is 
forced to estimate the volume and value of gas production on 
which royalty is due. Not surprisingly, these monthly estimated 
payments are not 100-percent accurate, resulting in a series of 
over and under payments to correct the amount reported and 
paid. Hence the current royalty system and requirements differ 
significantly from an individual's personal income tax payment, 
due annually on April 15. An individual's initial payment made 
to the Internal Revenue Service is based on actual values as 
opposed to estimated values and does not require after the fact 
adjustments.
    Given the complexity of determining proper production value 
for the month following the month of production, lessees do not 
have the information available to report and pay their royalty 
obligations accurately when the obligation is due, and should 
be provided the time value of money when data later indicates 
that they overpaid. The committee intends the rate of interest 
to be paid on overpayments to be the same rate paid to income 
taxpayers on their overpayments, the short term rate plus 2 
percent. Interest shall accrue from the date of the 
overpayment. The Secretary of the Treasury is directed and 
authorized to make interest payments under the Minerals Leasing 
Act and the Outer Continental Shelf Lands Act.
    If the Secretary determines that a lessee has paid in 
excess of 25 percent of its total royalty obligation for all of 
its leases subject to this part and further determines that 
such excessive payment was made for the sole purpose of 
receiving interest, the Secretary shall not pay interest on the 
amounts paid in excess of 25 percent. The committee expects 
lessees to place excess cash in other interest-bearing accounts 
rather than with the MMS.
    Lessees will be allowed to submit an approximate amount of 
royalties to avoid underpayment or nonpayment interest charges. 
When an estimated payment is made, the royalty payment becomes 
due at the end of the month following the period covered by the 
estimated payment. The committee does not intend to restrict 
the period of time covered by an estimate to 30 days.
    To provide clarity and establish simpler reporting on the 
most complex properties, royalty payment requirements are 
established for Federal leases contained in unit or 
communitization agreements. These requirements resolve the 
long-standing debate surrounding the proper volumetric basis 
for these properties for reporting and payment of royalties. In 
addition to providing clarity and simplicity, these 
requirements accelerate collections of royalties to the 
Government. At the end of the calendar year, for properties 
which have marginal production, royalties shall be paid on 
actual sales volumes and compared to the entitled volumes to 
determine if the obligation due has been over or underpaid. The 
Secretary and the State concerned shall agree on the definition 
of marginal for the provision of payment under this section. 
This provision will provide administrative relief associated 
with reporting for small producers.
    Within 2 years of enactment of this part, the Secretary 
shall resolve and issue demands on all outstanding payment 
disputes resulting from unitization and communitization 
agreements.
    Pursuant to the terms of Federal unit and communitization 
agreements, the Secretary receives requests for approval of 
allocation schedules for participating areas and 
communitization agreements. Delaying approval of this request 
delays determination of royalty value and results in costly 
retroactive adjustments. This section requires the Secretary to 
approve such requests within 120 days of receiving a complete 
request. If the Secretary does not approve the request, he 
shall waive interest on the obligation for the period of time 
following the 120th day until the request is approved by the 
Secretary.

Sec. 9517. Limitation on assessments.

    The Secretary may not impose assessments for late payment 
or underpayment, but the committee expects the Secretary to 
continue to impose civil penalties or interest. To reduce 
administrative burden and costs associated with assessments, 
assessments may not be imposed for erroneous reports for 18 
months following date of enactment, or until the Secretary 
issues a final rule, whichever is later. However, assessments 
may only be made against a lessee who chronically submits 
erroneous reports and such assessments shall only be made 
during this 18-month period if the error rate for all lessees 
increases by one-third for 3 consecutive months.

Sec. 9518. Alternatives for marginal properties

    The Secretary and the State concerned, as applicable, shall 
offer to lessees of marginal properties the opportunity to make 
a prepayment in lieu of royalties for the remainder of the 
lease term, based on the present value of projected royalty 
share of remaining production. The definition of marginal 
production shall be jointly determined by the Secretary and the 
State concerned.
    Identification of marginal properties for prepayments shall 
be based upon the average royalties paid per month. The 
Secretary shall have 2 years to set up the program to begin 
selling the revenue stream. After 2 years, the Secretary shall 
make available the prepayment option for properties. In the 
first year after this term, properties with less than $500 of 
royalty due per month will be made available, then increasing 
by $500 increments per ear for the next 2 years. In year 6, the 
Secretary shall make available a prepayment option to all 
marginal properties determined appropriate for this 
alternative, and approved by the State concerned.
    The Secretary and the State concerned must agree that the 
prepayment represents the present value of the projected 
remaining royalties, and the prepayment shall satisfy in full a 
lessee's royalty obligation relative to reporting, collection, 
and auditing.
    In addition to the marginal property program described 
above for selling the revenue stream, the Secretary and State 
concerned shall offer the same prepayment option for properties 
that are not cost-effective to administer. Such properties 
include remotely located Federal leases or States which have 
little Federal oil and gas royalties.
    Within 1 year after the date of enactment, the Secretary 
and the State concerned shall develop accounting, reporting, 
and auditing relief for marginal properties to reduce the 
regulatory burden. This relief will promote growth and 
continued production. The concerned State must agree to the 
proposed relief prior to the Secretary granting such relief for 
marginal wells.

Sec. 9519. Royalty-in-kind

    This section clarifies and establishes the requirements of 
the Secretary and lessee if the Secretary exercises the option 
to take his oil or gas in-kind. This section expressly provides 
for taking royalties in-kind at or near the lease (unless the 
lease specifically provides otherwise). Also the Secretary must 
provide adequate notice to the lessee so as not to disrupt the 
lessee's marketing arrangements. This provision also 
establishes that delivery of the Secretary's oil or gas by the 
lessee at the designated take point shall satisfy in full the 
lessee's royalty obligation and recordkeeping requirements. The 
only records required to be retained by the lessee will be 
those to verify the Secretary's volume of oil or gas delivered, 
subject to other provisions of this part, including the statute 
of limitations.

Sec. 9520. Royalty simplification and cost-effective audit and 
        collection requirements

    Within 1 year after the date of enactment of this part, in 
consultation with the States concerned, the Secretary is 
required to streamline and simplify current royalty management 
requirements and practices. The type of reform intended by the 
committee is contained in the testimony from the July 18, 1995, 
hearing of the House Energy and Minerals Resources 
Subcommittee. At the end of 1 year, the implemented 
simplification measures by the Secretary must reduce the costs 
to administer Federal royalties for the Secretary, States, and 
lessees and thereby increase net royalties to the United States 
and the States. The Secretary is required to submit a report to 
Congress on implementation of this section within 6 months from 
date of enactment, and a final report within 12 months 
outlining specific initiatives implemented.
    The Secretary and the State concerned are required to 
determine what Federal accounting and collection activities 
cannot be performed cost effectively. If the amount of taxpayer 
dollars used to perform the collection or the practice exceeds 
the amount to be collected, then the collection or activity is 
not to be performed. The committee intends for the Secretary 
and States to be particularly mindful of improvements relative 
to small amounts of production. For Federal leases within a 
State, that State must agree to the elimination of the 
collection or practice. However, the Secretary must ensure that 
a standardized reporting and collection process is retained so 
as not to significantly increase reporting and collection costs 
to the lessee.
    The committee expects the Secretary and the State concerned 
to develop an audit strategy which eliminates redundant 
reporting. Through the application of the Paperwork Reduction 
Act, State auditors auditing Federal lands under delegation via 
section 205 of the Federal Oil and Gas Royalty Management Act 
of 1982 shall not be allowed to require or request information 
and forms previously provided to the Secretary by the lessee. 
Also, the States and Secretary may not both audit the same 
lease(s) for alike time periods or require information relative 
to the same lease(s) and time period once either the Secretary 
or States begin an audit of such lease(s).

Sec. 9521. Repeals

    This provision repeals statutes in conflict with the part's 
provisions.

Sec. 9522. Delegation to States

    States may currently perform certain royalty audit 
activities if they enter into a cooperative agreement with the 
Secretary. This section allows a State to enter into a 
cooperative agreement with the Secretary to perform legally 
delegable royalty and production accounting activities. If a 
Federal activity is not deemed to be inherently Federal and it 
does not compromise efficiencies realized by standardized 
collection and royalty reporting processes, an interested State 
may pursue a cooperative agreement to perform such activity.

Sec. 9523. Performance standard

    This section provides that certain civil penalties may only 
be levied on lessees who engage in ``willful misconduct or 
gross negligence.''

Sec. 9524. Indian lands

    This part does not apply to Indian lands. Upon enactment, 
there will essentially be two Federal Oil and Gas Royalty 
Management Acts. The 1982 version, unamended by this act, will 
continue to apply to all Indian leases and production occurring 
on or before the date of enactment. For oil and gas production 
occurring after the date of enactment of the Federal Oil and 
Gas Royalty Management Act of 1982 as amended by this act will 
apply.
    For any State having Federal leases which result in less 
than $100,000 in Federal mineral revenues, the State may 
request that the Secretary delegate collection to the State or 
allow the State to sell the revenue stream from all or part of 
the Federal leases contained in the State.

Sec. 9525. Private lands

    This part does not apply to private lands.

Sec. 9526. Effective date

    This part will apply to production of oil and gas on and 
after the first day of the month following the date of 
enactment of this part. In no way does the committee intend the 
provisions of this part to alter rights or obligations of the 
Secretary for production occurring prior to the date of 
enactment, unless expressly noted otherwise in this part.

                  subtitle f--indian gaming and health

                         Part 1--Indian gaming

Sec. 9601. Indian gaming

    Subsection (a) amends section 18(a) of the Indian Gaming 
Regulating Act to increase, by $1 million, the Indian Gaming 
Commission's authority to impose up to $1,500,000 in fees on 
certain Indian gaming activities.
    Subsection (b) amends section 19(a) of the Indian Gaming 
Regulatory Act to terminate all authority to appropriate funds 
for the operation of the Indian Gaming Commission. One million 
dollars was appropriated for the operation of the Commission in 
FY 1995 and the same is proposed for FY 1996.

                    Part 2--Indian Health: Medicaid

Sec. 9611. Health care facilities

    This section would allow tribally operated health programs 
which own their own facilities to participate in the Medicaid 
program. Current law only allows Indian Health Service [IHS] 
and tribal programs which operate out of IHS-owned facilities 
to participate in Medicaid. This provision would ensure that 
tribal programs operated out of facilities owned by a tribe, a 
tribal organization, or an urban Indian organization, would be 
eligible to receive reimbursement through Medicaid.

Sec. 9612. Provider reimbursement

    Subsection (c) would ensure that IHS and tribal health 
programs which currently participate in the Medicaid program 
will continue to be eligible providers under any new State plan 
created as a result of Medicaid reform. It is likely that under 
the proposed Medicaid plan, which will cap entitlement funds 
and block grant them to States, the States will enroll their 
own Medicaid eligible citizens in HMO or managed care-style 
plans. Thus, Medicaid-eligible patients will have to go to 
those health care providers that are sanctioned through the 
State plan. This section is intended to ensure that tribal or 
IHS health care providers will remain able to treat Indian 
Medicaid-eligible patients and participate as any other 
provider would under a new State plan.
    Subsection (d) would ensure that all Medicaid-eligible 
Indians will continue to have the ability to receive care from 
a State plan provider under any new State plan created pursuant 
to proposed Medicaid reform legislation.
    Subsection (e) would ensure that a private health care 
provider who provides services to Medicaid-eligible Indians is 
not denied payment by the State on the grounds that the State 
is the payor of last resort and the provider should first seek 
reimbursement from the IHS.
    Subsection (f) would ensure that tribes are consulted in 
the development of State plan standards under Medicaid reform.

Sec. 9613. Study

    This subsection requires the Secretary of Health and Human 
Services to carefully study the effects of Medicaid reform on 
Indians and Indian tribes and report to Congress as to whether 
the effects are good or bad and what can be done to improve 
Medicaid for Indians.

                    Part 3--Indian Health; Medicare

Sec. 9621. Health care facilities

    This section allows tribally operated health programs which 
own their own facilities to participate in the Medicare 
program. Current law only allows IHS and tribal programs which 
operate out of IHS-owned facilities to participate in Medicare. 
This provision would ensure the tribal programs operated out of 
facilities owned by a tribe, a tribal organization, or an urban 
Indian organization, would be eligible to receive reimbursement 
through Medicare.

Sec. 9622. Provider reimbursement

    The purpose of this subsection is to ensure that IHS and 
tribal health programs will continue to be eligible providers 
under any new plan offered under the Medicare Plus plan as a 
result of Medicare reform. It is likely, under proposed 
Medicare reform legislation, that the Federal Government will 
offer incentives to enroll Medicare-eligible beneficiaries in 
HMO or managed care-style plans. This subsection is intended to 
ensure that tribal or IHS health care providers, who treat 
Indian Medicare-eligible patients, will continue to be able to 
participate along with other providers under the Medicare Plus 
plan.

                        subtitle g--consultation

Sec. 9701. Consultation

    Section 7 of the Endangered Species Act sets forth a 
requirement that Federal agencies ensure that their actions do 
not jeopardize the continued existence of the species or 
adversely modify the habitat of the species. If an agency finds 
that such a result is likely, it must enter into consultations 
with the Secretary of the Department of the Interior who will 
render a biological assessment setting forth the impact of the 
proposed Federal agency action and suggesting reasonable and 
prudent alternatives.
    After consultation is initiated, the agency is required not 
to make or allow the private license or permit applicant to 
make an irretrievable commitment of resources which might have 
the effect of foreclosing the formulation or implementation of 
any reasonable and prudent alternatives. This section would 
make it clear that the prohibition against the irretrievable 
commitment of resources applies to a project or site specific 
activity. The prohibition would not apply to long-term planning 
activities, missions, policy statements, programmatic documents 
or general statements of policy.

                          subtitle h--mapping

Sec. 9801. Short title

    This section establishes the short title for this subtitle, 
Department of the Interior Surveying and Mapping Efficiency and 
Economic Opportunity Act.

Sec. 9802. Surveying and mapping contracting program

    This section requires the Secretary to conduct a surveying 
and mapping contracting program.

Sec. 9803. Inventory of activities

    This section requires the Secretary to conduct and publish 
an inventory of surveying and mapping activities to serve as a 
baseline for the contracting program.

Sec. 9804. Plan to increase use of contracts

    This section requires the Secretary to establish a plan to 
increase the use of contracting with the private sector for 
Department's surveying and mapping needs.
    Notwithstanding this provision, the committee does 
recognize that contracting out efforts are underway in many 
Department of the Interior agencies. For example, an agreement 
reached in this Congress requires the U.S. Geological Survey 
[USGS] to contract 60 percent of its mapping services by 1999.
    Also, the proposed contracting program contained in this 
section is not intended to preclude Federal participation in a 
more expansive study of surveying and mapping this year. The 
study, encompassing the issue of contracting, will address what 
is the appropriate use of Government, if any, in surveying and 
mapping functions.
    With respect to sections 9803 and 9804, the committee 
intends to include both the professional association 
representing surveying and mapping and the private trade 
association, MAPPS, in the consultation process on the 
contracting program.
    This plan will include: Reduction in surveying and mapping 
activities by Department personnel that duplicate private 
sector capabilities; reduction in acquisition and maintenance 
of equipment that duplicates the private sector; prohibition on 
Department performance of services for other Government 
entities that can be obtained by contract from the private 
sector; increase use of contracts for requirements created 
through attrition in the Department; and enhancement of the 
Department's role in preparation of standards and 
specifications, research and technology transfer, coordination, 
cost sharing, and administration, establishing goals for 
contracting, and performing activities that are inherently 
governmental in nature.

Sec. 9805. Reports

    This section requires annual reports to track program 
progress.

Sec. 9806. Definitions

    This section defines the terms ``surveying and mapping'' 
and ``contract'' based on current regulations of the U.S. Army 
Corps of Engineers, the Government's largest contractor of 
these services.

                subtitle i--national park system reform

Sec. 9901. Short title

    This section provides that this subtitle may be cited as 
the National Park System Reform Act of 1995.

Sec. 9902. Definitions.

    This section defines terms used in the bill.

                   Part 1--National Park System Plan

Sec. 9911. Preparation of National Park System plan

    This section directs the Secretary of the Interior, acting 
through the Director of the National Park Service [NPS], to 
prepare a plan to guide the direction of the National Park 
System into the next century. The plan would be submitted to 
Congress and would: Define the role of the NPS in preserving 
America's heritage relative to other efforts at the Federal, 
State, local, and private levels; include detailed criteria to 
be used to determine which resources are appropriate for 
inclusion in the National Park System; identify aspects of 
American heritage which are adequately and inadequately 
represented in the existing National Park System; and list 
priorities of the types of resources which should be added to 
the National Park System. Additionally, the plan would include 
an analysis of the role of the NPS with respect to such topics 
as the conservation of natural areas and ecosystems, the 
preservation of industrial America, the preservation of 
intangible cultural resources, open space protection, and the 
provision of outdoor recreation opportunities. These five 
topics need particular attention due to the increasing 
frequency of legislative initiatives relating to them and the 
park planning and management questions they pose.
    While human history continues to evolve, leading to a 
virtual unending supply of historical sites for potential 
inclusion in the National Park System, the variety of natural 
systems is finite and generally well known. Further, while all 
Federal agencies are required to preserve historic resources in 
accord with the National Historic Preservation Act of 1966, for 
Federal agencies, other than the NPS, this responsibility is 
incidental to the basic agency mission. However, there are 
three other Federal land management agencies who have 
conservation of natural communities as a primary agency 
mission. In the past, a number of new park units have been 
established by transferring lands from the jurisdiction of 
other Federal land management agencies to the NPS. The 
respective roles of these agencies must be clarified to reduce 
duplication and cost, and ensure a more integrated land use 
planning approach.
    The committee notes the growing number of legislative 
initiatives dealing with America's industrial and technological 
history, ranging from mining to manufacturing. The committee 
believes there is an important role for the NPS in preserving 
and interpreting our industrial heritage and notes that a 
number of such units already exist. The committee is concerned, 
however, about the proliferation of such proposals and the lack 
of context and criteria to guide the consideration of these 
proposals, and their potential cost. The history of industry is 
full of advances and innovations and there are numerous sites 
which may have some historic value. The NPS needs to develop a 
framework to help decide how to best use its limited resources 
to assist in the preservation of industrial history.
    The committee also notes a trend of new area proposals 
dealing with art, music, and other nontangible cultural 
resources. The NPS needs to develop a clear policy direction 
with regard to these types of resources.
    Protection of undeveloped open space is argued by some as 
important to the overall quality of life. This is particularly 
true in urban areas, where open space is often limited. In 
recent years, there have been an increasing number of proposals 
for the Federal Government, through the NPS, to devote 
considerable effort to urban space protection. Oftentimes, 
these areas do not have any nationally significant natural 
resource values. The NPS needs to evaluate the extent to which 
the agency should make commitments to open space preservation.
    The provision of outdoor recreation opportunities has 
always been a function of the NPS, yet there is little 
congressional policy direction about how this function fits in 
with the more fundamental agency role of protecting natural and 
historical resources. Outdoor recreation is essential to the 
quality of our lives, and outdoor recreation opportunities are 
provided by nearly every land managing agency at the Federal, 
State, and local level. The plan should address NPS's 
particular role in providing outdoor recreation opportunities 
relative to these other agencies, and whether outdoor 
recreation is a reason in and of itself to establish a unit of 
the National Park System.
    Subsection (a)(8) directs NPS to prepare a comprehensive 
financial plan for its future. The committee is very concerned 
about adequacy of funding for the NPS. NPS general management 
plans, new area studies and other plans often propose actions 
which are not financially achievable. Therefore, the committee 
wants to ensure that: First, NPS develops a program which will 
meet the basic financial needs of the agency to provide for 
resource conservation and essential visitor services; and 
second, that any plan for the future of the agency be 
financially realistic.
    Subsection (b) requires to undertake a broad program of 
public involvement in the development of the plan. The 
consultations will include appropriate opportunities for public 
review and comment.
    Subsection (c) directs NPS to submit the plan to relevant 
congressional committees no later than two complete fiscal 
years after the date of enactment of this part.
    Subsection (d) provides for an opportunity for Congress to 
provide input into the plan. Since any plan developed for the 
future of the National Park System will only be viable to the 
extent it is agreed to by both the administration and Congress, 
it is critical that Congress be provided an opportunity for 
input on this plan. Congress may elect to adopt the plan 
entirely, agree with some portions of the plan and reject other 
portions, or reject the plan entirely.
    Subsection (e) provides for the official identification of 
existing areas or units of the Park System. This is important, 
since existing law requires that all existing laws, policies, 
and regulations of the Park System apply to all areas 
administered by the agency. Without an accurate list of areas 
or units administered by NPS, the agency would be required to 
apply this regulatory framework to areas unintended by 
Congress. For example, a general management plan would have to 
be prepared for every area and NPS policies on fishing and 
hunting could have unknown intentions.
    Subsection (f) clarifies the manner in which units may be 
added to the National Park System. Specifically excluded under 
this language is the authority of the Secretary of the Interior 
to establish new units pursuant to a cooperative agreement.

Sec. 9912. Management review of National Park System

    This section directs the Secretary to conduct a management 
review of the existing National Park System to determine 
whether there are more appropriate alternatives for managing 
specific units or portions of units, including partnerships or 
direct management by State, local governments, other agencies, 
or the private sector. This review would be conducted using the 
direction provided by the plan required in section 9911 and by 
the criteria developed pursuant to this section.
    In conducting this review, the committee does not intend 
for NPS to conduct a boundary study of every park area. Rather, 
the term ``significant portion'' refers to a discrete portion 
of a park which would typically constitute a district or 
subdistrict. While the Secretary may recommend discontinuation 
of NPS management for any entire unit of the Park System 
(except a national park), which is inconsistent with the 
National Park System plan, the Secretary may only recommend 
modification of the management at a portion of a part which 
does not conform to the plan. The legislation prohibits the 
Secretary from reviewing any portion of the 54 areas currently 
classified as ``national parks.''
    In developing the list of areas where NPS management should 
be modified or terminated, this section also requires the NPS 
to consult with other Federal agencies, State and local 
officials, resource managers, recreation and scholarly 
organizations and other interested parties. This list would be 
transmitted to Congress within 18 months after the completion 
of the National Park System plan and would require the 
Secretary to recommend alternative entities to manage sites 
proposed to be terminated. For any area determined to have 
national significance, the Secretary shall identify feasible 
alternatives to NPS management which will protect the resources 
and assure continued public access.
    This section does not provide for the automatic closing of 
any unit of the National Park System. Instead, the committee 
believes that Congress should retain this authority. National 
Park System units, in the overwhelming majority of cases, have 
been established by congressional action and any 
deauthorization should be by act of Congress as well. While 
legislation would be required to deauthorize any existing park 
units, this part is not intended to limit the Secretary's 
current authority to make modifications in the management of 
National Park System units, including developing partnerships 
or other arrangements to the extent that such modifications are 
already authorized by law. The committee notes the sensitive 
nature of NPS's task in developing this list. The committee 
expects NPS to make an intensive effort to research, develop, 
and cultivate alternative entities to manage areas proposed for 
deauthorization. The likelihood of deauthorizing legislation 
passing Congress would be increased if there is sustained and 
thorough effort to develop a ``soft landing'' for areas 
proposed for deauthorization.

Sec. 9913. National Park System Review Commission

    This section provides for the establishment of an 11-member 
National Park System Review Commission. This Commission would 
be charged with reviewing the report of NPS prepared pursuant 
to this section, or, if the Secretary does not complete such a 
report, the National Park System Review Commission is charged 
with preparing the report in the same manner as if prepared by 
the Secretary. The National Park System Review Commission shall 
complete its work no later than 2 years after the completion of 
NPS plan, and shall terminate 90 days after submission of its 
report to Congress.
    The committee believes that establishment of an independent 
Commission is the best way to ensure the completion of a 
thorough, independent, and professional review of the National 
Park System. The committee has provided for a balanced 
Commission by ensuring the involvement of the administration 
and House and Senate majority and minority leaders in the 
selection process for Commission members. Further, the 
legislation requires that Commission members be knowledgeable 
regarding NPS and have special expertise with respect to the 
mission of the agency. With respect to the requirement that 
Commission members have expertise in natural resources, the 
committee intends that the commission include expertise in both 
marine resources and terrestrial ecology.

Sec. 9914. Subsequent act of Congress required to modify or terminate a 
        park

    This section clarifies that congressional action is 
required to modify or terminate a National Park System unit.

Sec. 9915. Authorization of appropriations

    This section provides for the authorization of necessary 
funding to implement the part.

Sec. 9916. Commendation and protection of National Park Rangers

    This section requires that the Secretary of the Interior 
report to Congress on procedures in place to report threats or 
acts of violence against NPS employees.

                     Part 2--New Area Establishment

Sec. 9921. Study of new park system areas

    This section amends the Act of August 18, 1970 (commonly 
known as the General Authorities Act) to make a number of 
reforms to the new area study process.
    The new subsection (b) provides that at the beginning of 
each calendar year, along with the annual budget submission, 
the Secretary will submit to Congress a list of any areas 
recommended for study with potential to meet the established 
criteria of national significance, suitability, and 
feasibility. The Secretary shall give special consideration to 
themes, sites, and resources not already adequately represented 
in the National Park System as identified in the National Park 
System plan.
    This section would require all new area studies to be 
specially authorized by Congress. The committee notes that this 
prohibition does not apply to the authority of NPS to conduct 
preliminary resources assessments, gather data on potential 
study sites, provide technical and planning assistance, process 
nominations for administrative designations, update previous 
studies, or complete reconnaissance surveys of individual sites 
requiring a total expenditure of less than $25,000. The 
committee also notes that this provision does not effect the 
study authority contained in the Wild and Scenic Rivers Act, 
the National Trails System Act or the Wilderness Act. Upon 
authorization, studies would have to be completed in 3 years 
and would have to contain the management alternative preferred 
by NPS. This section also specifies the national significance, 
suitability, and feasibility criteria and other factors which 
the study must consider.
    Each study shall identify what alternative or combination 
of alternatives would, in the professional judgment of NPS, be 
most effective and efficient in protecting significant 
resources and providing for public enjoyment. The letter 
transmitting each study to Congress shall contain a 
recommendation regarding the administration's preferred 
management option for the area. The committee expects these 
studies to reflect the highest possible professional standards 
and provide a clear recommendation to Congress. If an area 
fails to meet established criteria, the study should clearly 
state this finding. The purpose of these reforms is to provide 
Congress with the professional opinion of NPS earlier in the 
process of considering areas for addition to the Park System.
    This section also requires the Secretary to annually submit 
a prioritized list of areas previously studied for addition to 
the National Park System. NPS will submit two priority 
rankings, one for areas which contain primarily historical 
resources and one for areas which contain primarily natural 
resources.

   Changes in Existing Law Made by Title IX of the Bill, as Reported

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italics, existing law in which no change 
is proposed is shown in roman):

                          MINERAL LEASING ACT

           * * * * * * *
    Sec. 24. That upon showing to the satisfaction of the 
Secretary of the Interior that valuable deposits of one of the 
substances enumerated in section 23 hereof have been discovered 
by the permittee within the area covered by his permit and that 
such land is chiefly valuable therefor, the permittee shall be 
entitled to a lease for any or all of the land embraced in the 
prospecting permit at a royalty of not less than 2 per centum 
and not greater than five and one-half per centum of the 
quantity or gross value of the output of sodium compounds and 
other related products at the point of shipment to market; the 
lands in such lease to be taken in compact form by legal 
subdivisions of the public land surveys or, if the land be not 
surveyed, by survey executed at the cost of the permittee in 
accordance with regulations prescribed by the Secretary of the 
Interior. Lands known to contain valuable deposits of one of 
the substances enumerated in section 2 hereof and not covered 
by permits or leases shall be subject to lease by the Secretary 
of the Interior through advertisement, competitive bidding, or 
such other methods as he may by general regulations adopt and 
in such areas as he shall fix, not exceeding two thousand five 
hundred and sixty acres. All leases under this section shall be 
conditioned upon the payment by the lessee of such royalty as 
may be fixed in the lease, not less than 2 per centum and not 
greater than five and one-half per centum of the quantity or 
gross value of the output of sodium compounds and other related 
products at the point of shipment to market, and the payment in 
advance of a rental of 25 cents per acre for the first calendar 
year or fraction thereof, 50 cents per acre for the second, 
third, fourth, and fifth calendar years respectively; and $1 
per acre per annum thereafter during the continuance of the 
lease, such rental for any one year to be credited against 
royalties accruing for that year. Leases under this section 
shall be for a period of twenty years, with preferential right 
in the lessee to renew for successive periods of ten years upon 
such reasonable terms and conditions as may be prescribed by 
the Secretary of the Interior unless otherwise provided by law 
at the expiration of such period: Provided, That nothing in 
this Act shall prohibit the mining and sale of sodium compounds 
under potassium leases issued pursuant to the Acts of October 
2, 1917 (Fortieth Statutes at Large, page 297), and February 7, 
1927 (Forty-fourth Statutes at Large, page 1057), nor the 
mining and sale of potassium compounds as a byproduct from 
sodium leases taken under this section: Provided further, That 
on application by any lessee the Secretary of the Interior is 
authorized to modify the rental and royalty provisions 
stipulated in any existing sodium lease to conform to the 
provisions of this section.
           * * * * * * *

                           grant of authority

    Sec. 28. (a) * * *
          * * * * * * *

                        [right-of-way corridors

    [(s) In order to minimize adverse environmental impacts and 
to prevent the proliferation of separate rights-of-way across 
Federal lands, the Secretary shall, in consultation with other 
Federal and State agencies, review the need for a national 
system of transportation and utility corridors across Federal 
lands and submit a report of his findings and recommendations 
to the Congress and the President by July 1, 1975.]


                   exports of alaskan north slope oil


    (s)(1) Subject to paragraphs (2) through (6) of this 
subsection and notwithstanding any other provision of this Act 
or any other provision of law (including any regulation) 
applicable to the export of oil transported by pipeline over 
right-of-way granted pursuant to section 203 of the Trans-
Alaska Pipeline Authorization Act (43 U.S.C. 1652), such oil 
may be exported unless the President finds that exportation of 
this oil is not in the national interest. The President shall 
make his national interest determination within 5 months after 
the date of enactment of this subsection. In evaluating whether 
exports of this oil are in the national interest, the President 
shall at a minimum consider--
          (A) whether exports of this oil would diminish the 
        total quantity or quality of petroleum available to the 
        United States;
          (B) the results of an appropriate environmental 
        review, including consideration of appropriate measures 
        to mitigate any potential adverse effects of exports of 
        this oil on the environment, which shall be completed 
        within 4 months of the date of the enactment of this 
        subsection; and
          (C) whether exports of this oil are likely to cause 
        sustained material oil supply shortages or sustained 
        oil prices significantly above world market levels that 
        would cause sustained material adverse employment 
        effects in the United States or that would cause 
        substantial harm to consumers, including in 
        noncontiguous States and Pacific territories.
If the President determines that exports of this oil are in the 
national interest, he may impose such terms and conditions 
(other than a volume limitation) as are necessary or 
appropriate to ensure that such exports are consistent with the 
national interest.
    (2) Except in the case of oil exported to a country with 
which the United States entered into a bilateral international 
oil supply agreement before November 26, 1979, or to a country 
pursuant to the International Emergency Oil Sharing Plan of the 
International Energy Agency, any oil transported by pipeline 
over right-of-way granted pursuant to section 203 of the Trans-
Alaska Pipeline Authorization Act (43 U.S.C. 1652) shall, when 
exported, be transported by a vessel documented under the laws 
of the United States and owned by a citizen of the United 
States (as determined in accordance with section 2 of the 
Shipping Act, 1916 (46 U.S.C. App. 802)).
    (3) Nothing in this subsection shall restrict the authority 
of the President under the Constitution, the International 
Emergency Economic Powers Act (50 U.S.C. 1701 et seq.), or the 
National Emergencies Act (50 U.S.C. 1601 et seq.) to prohibit 
exports of this oil or under Part B of title II of the Energy 
Policy and Conservation Act (42 U.S.C. 6271-76).
    (4) The Secretary of Commerce shall issue any rules 
necessary for implementation of the President's national 
interest determination, including any licensing requirements 
and conditions, within 30 days of the date of such 
determination by the President. The Secretary of Commerce shall 
consult with the Secretary of Energy in administering the 
provisions of this subsection.
    (5) If the Secretary of Commerce finds that exporting oil 
under authority of this subsection has caused sustained 
material oil supply shortages or sustained oil prices 
significantly above world market levels and further finds that 
these supply shortages or price increases have caused or are 
likely to cause sustained material adverse employment effects 
in the United States, the Secretary of Commerce, in 
consultation with the Secretary of Energy, shall recommend, and 
the President may take, appropriate action concerning exports 
of this oil, which may include modifying or revoking authority 
to export such oil.
    (6) Administrative action under this subsection is not 
subject to sections 551 and 553 through 559 of title 5, United 
States Code.
          * * * * * * *
    Sec. 36. That all royalty accruing to the United States 
under any oil or gas lease or permit under this Act on demand 
of the Secretary of the Interior shall be paid in oil or gas.
    Upon granting any oil or gas lease under this Act, and from 
time to time thereafter during said lease, the Secretary of the 
Interior shall, except whenever in his judgment it is desirable 
to retain the same for the use of the United States, offer for 
sale for such period as he may determine, upon notice and 
advertisement on sealed bids or at public auction, all royalty 
oil and gas accruing or reserved to the United States under 
such lease. Such advertisement and sale shall reserve to the 
Secretary of the Interior the right to reject all bids whenever 
within his judgment the interest of the United States demands; 
and in cases where no satisfactory bid is received or where the 
accepted bidder fails to complete the purchase, or where the 
Secretary of the Interior shall determine that it is unwise in 
the public interest to accept the offer of the highest bidder, 
the Secretary of the Interior, within his discretion, may 
readvertise such royalty for sale, or sell at private sale at 
not less than the market price for such period, or accept the 
value thereof from the lessee: Provided, That inasmuch as the 
public interest will be served by the sale of royalty oil to 
refineries not having their own source of supply for crude oil, 
the Secretary of the Interior, when he determines that 
sufficient supplies of crude oil are not available in the open 
market to such refineries, is authorized and directed to grant 
preference to such refineries in the sale of oil under the 
provisions of this section, for processing or use in such 
refineries and not for resale in kind, and in so doing may sell 
to such refineries at private sale at not less than the market 
price any royalty oil accruing or reserved to the United States 
under leases issued pursuant to this Act, amended: Provided 
further, That in selling such royalty oil the Secretary of the 
Interior may at his discretion prorate such oil such refineries 
in the area in which the oil is produced: Provided, however, 
That pending the making of a permanent contract for the sale of 
any royalty, oil or gas as herein provided, the Secretary of 
the Interior may sell the current product at private sale, at 
not less than the market price: And provided further, That any 
royalty, oil, or gas may be sold at not less than the market 
price at private sale to any department or agency of the United 
States.
    Notwithstanding the provisions of the previous paragraph, 
any royalty or net profit share of oil or gas accruing to the 
United States under any lease issued or maintained by the 
Secretary of the exploration production and development of oil 
and gas on Federal lands, at the Secretary's option, may be 
taken in kind at or near the lease (unless the lease expressly 
provides for delivery at a different location) after prior 
written notice given reasonably in advance by the Secretary to 
the lessee. Once the United States has commenced taking royalty 
in kind, it shall continue to do so until a reasonable time 
after the Secretary has provided written notice reasonable in 
advance to the lessee that it will resume taking royalty in 
value. Delivery of royalty in kind by the lessee shall satisfy 
in full the lessee's royalty obligation. Once the oil or gas is 
delivered, the lessee shall not be subject to the reporting and 
recordkeeping requirements under section 103 for its share of 
oil and gas production other than records necessary to verify 
the quantity of oil or gas delivered.
          * * * * * * *
                              ----------                              


  SECTION 1003 OF THE ALASKA NATIONAL INTEREST LANDS CONSERVATION ACT

                      [prohibition on development

    [Sec. 1003. Production of oil and gas from the Arctic 
National Wildlife Refuge is prohibited and no leasing or other 
development leading to production of oil and gas from the range 
shall be undertaken until authorized by an Act of Congress.]
                              ----------                              


       SECTION 7 OF THE NORTH AMERICAN WETLANDS CONSERVATION ACT

SEC. 7. AMOUNTS AVAILABLE TO CARRY OUT THIS ACT.

    (a) * * *
          * * * * * * *
    (e) Fish and Wildlife Commission Funding.--In addition to 
the amounts made available under subsections (a), (b), and (c) 
of this section, the Council may receive funds from the Fish 
and Wildlife Commission to carry out the purposes of this Act. 
Use of such funds shall not be subject to the cost allocation 
requirements of section 8 of this Act.
                              ----------                              


                         ACT OF AUGUST 9, 1955

 [AN ACT To authorize the Secretary of the Interior to investigate and 
 report to the Congress on projects for the conservation, development, 
           and utilization of the water resources of Alaska.

    [Be it enacted by the Senate and House of Representatives 
of the United States of America in Congress assembled, That, 
for the purpose of encouraging and promoting the development of 
Alaska, the Secretary of the Interior (hereinafter referred to 
as the ``Secretary'') is authorized to make investigations of 
projects for the conservation, development, and utilization of 
the water resources of Alaska and to report thereon, with 
appropriate recommendations, from time to time, to the 
President and to the Congress.
    [Sec. 2. Prior to the transmission of any such report to 
the Congress, the Secretary shall transmit copies thereof for 
information and comment to the Governor of Alaska, or to such 
representative as may be named by him, and to the heads of 
interested Federal departments and agencies. The written views 
and recommendations of the aforementioned officials may be 
submitted to the Secretary within ninety days from the day of 
receipt of said proposed report. The Secretary shall 
immediately thereafter transmit to the Congress, with such 
comments and recommendations as he deems appropriate, his 
report, together with copies of the views and recommendations 
received from the aforementioned officials. The letter of 
transmittal and its attachments shall be printed as a House or 
Senate document.
    [Sec. 3. There are hereby authorized to be appropriated not 
more than $250,000 in any one fiscal year.]
                              ----------                              


        SECTION 302 OF THE DEPARTMENT OF ENERGY ORGANIZATION ACT

             transfers from the department of the interior

    Sec. 302. (a)(1) There are hereby transferred to, and 
vested in, the Secretary all functions of the Secretary of the 
Interior under section 5 of the Flood Control Act of 1944, and 
all other functions of the Secretary of the Interior, and 
officers and components of the Department of the Interior, with 
respect to--
          (A) the Southeastern Power Administration;
          (B) the Southwestern Power Administration;
          [(C) the Alaska Power Administration;]
          [(D)] (C) the Bonneville Power Administration 
        including but not limited to the authority contained in 
        the Bonneville Project Act of 1937 and the Federal 
        Columbia River Transmission System Act;
          [(E)] (D) the power marketing functions of the Bureau 
        of Reclamation, including the construction, operation, 
        and maintenance of transmission lines and attendant 
        facilities; and
          [(F)] (E) the transmission and disposition of the 
        electric power and energy generated at Falcon Dam and 
        Amistad Dam, international storage reservoir projects 
        on the Rio Grande, pursuant to the Act of June 18, 
        1954, as amended by the Act of December 23, 1963.
    (2) The Southeastern Power Administration, the Southwestern 
Power Administration, [the Bonneville Power Administration, and 
the Alaska Power Administration] and the Bonneville Power 
Administration shall be preserved as separate and distinct 
organizational entities within the Department. Each such entity 
shall be headed by an Administrator appointed by the Secretary. 
The functions transferred to the Secretary in paragraphs 
(1)(A), (1)(B), (1)(C), and (1)(D) shall be exercised by the 
Secretary, acting by and through such Administrators. Each such 
Administrator shall maintain his principal office at a place 
located in the region served by his respective Federal power 
marketing entity.
          * * * * * * *
                              ----------                              


                               HELIUM ACT

    [Sec. 3. (a) For the purpose of conserving, producing, 
buying, and selling helium, the Secretary is authorized--
          [(1) to acquire by purchase, lease, gift, exchange, 
        or eminent domain, lands or interests therein or 
        options thereon, including but not limited to sites, 
        rights-of-way, and oil or gas leases containing 
        obligations to pay rental in advance or damages arising 
        out of the use and operation of such properties; but 
        any such land or interest in lands may be acquired by 
        eminent domain only when the Secretary determines (A) 
        that he is unable to make a satisfactory agreement to 
        acquire such land or interest in land, and (B) that 
        such acquisition by eminent domain is necessary in the 
        national interest;
          [(2) to make just and reasonable contracts and 
        agreements for the acquisition, processing, 
        transportation, or conservation of helium, helium-
        bearing natural gas, or helium-gas mixtures upon such 
        terms and conditions, and for such periods, not 
        exceeding 25 years, as may be necessary to accomplish 
        the purposes of the Act, except that the Secretary 
        shall not make such contracts and agreements which 
        shall require payments by the Government in any one 
        fiscal year aggregating more than the amount which 
        shall be established initially in an appropriation Act 
        and which may be increased from time to time in 
        appropriation Acts, or if the Secretary--
                  [(A) determines that the national interests 
                require the conservation of certain helium or 
                require certain helium-bearing natural gas or 
                certain helium-gas mixture for the production 
                or conservation of helium, and
                  [(B) determines that he is unable to acquire 
                such helium, helium-bearing natural gas, or 
                helium-gas mixture upon reasonable terms and at 
                the fair market value,
        he is authorized to acquire by eminent domain such 
        helium and so much of such helium-bearing natural gas 
        or helium-gas mixture as is necessarily consumed in the 
        extraction of such helium after removal from its place 
        of deposit in nature and wherever found, or the 
        temporary use of such helium-bearing natural gas or 
        helium-gas mixture for the purpose of extracting 
        helium, together with the appropriate interest in 
        pipelines, equipment, installations, facilities, 
        personal or real property, including reserves, 
        easements or other rights necessary or incident to the 
        acquisition of such helium, natural gas, or mixture, 
        but the condemnation of any such helium, helium-bearing 
        natural gas, or helium-gas mixture, shall be effected 
        in the same manner and following the procedures 
        established in section 8(a) of this Act, the just 
        compensation for such condemnation to be measured by 
        terms and prices determined to be commensurate with the 
        fair market value, and in the temporary use of any 
        helium-bearing natural gas or helium-gas mixture for 
        the purpose of extracting helium the Secretary shall 
        cause no delay in the delivery of natural gas to the 
        owner, purchaser, or purchasers thereof, except that 
        required by the extractive processes;
          [(3) to construct or acquire by purchase, lease, 
        exchange, gift or eminent domain, plants, wells, 
        pipelines, compressor stations, camp buildings, and 
        other facilities, for the production, storage, 
        purification, transportation, purchase, and sale of 
        helium, helium-bearing natural gas, and helium-gas 
        mixtures: and to acquire patents or rights therein and 
        reports of experimentation and research used in 
        connection with the properties acquired or useful in 
        the Government's helium operations;
          [(4) to dispose of, by lease or sale, property, 
        including wells, lands, or interests therein, not 
        valuable for helium production, and oil, gas, and 
        byproducts, of helium operations not needed for 
        Government use, except that property determined by the 
        Secretary to be `excess' within the meaning of section 
        3(e) of the Federal Property and Administrative 
        Services Act of June 30, 1949 (60 Stat. 378; 40 U.S.C. 
        472(e)), as amended, shall be disposed of in accordance 
        with the provisions of that Act; and to issue leases to 
        the surface of lands or structures thereon for grazing 
        or other purposes when the same may be done without 
        interfering with the production of helium; and
          [(5) to accept equipment, money, and other 
        contributions from public and private sources and to 
        prosecute projects in cooperation with other agencies, 
        Federal, State, or private.
    [(b) Any known helium-gas-bearing land on the public domain 
not covered at the time by leases or permits under the Mineral 
Lands Leasing Act of February 25, 1920, as amended, may be 
reserved for the purposes of this Act, and any reservation of 
the ownership of helium may include the right to extract, or 
have extracted, such helium, under such rules and regulations 
as may be prescribed by the Secretary, from all gas produced 
from lands so permitted, leased, or otherwise granted for 
development, except that in the extraction of helium from gas 
produced from such lands, it shall be extracted so as to cause 
no delay, except that required by the extraction process, in 
the delivery of gas produced from the well to the purchaser or 
purchasers thereof at the point of delivery specified in 
contracts for the purchase of such gas. If any reserved rights 
of ownership and extraction of helium are not exercised before 
production of any helium-bearing natural gas or any helium-gas 
mixture, the Secretary is authorized to acquire such helium in 
accordance with section 3(a)(2) of this Act.
    [(c) All contracts and agreements made by the Secretary for 
the acquisition of helium from a private plant shall contain a 
provision precluding the plant owner from selling any helium to 
any purchaser other than the Secretary at a price lower than 
the lowest price paid by any Government agency for helium 
acquired from any private plant under any contract entered into 
pursuant to this section and outstanding at the time of such 
sale.
    [Sec. 4. The Secretary is authorized to maintain and 
operate helium production and purification plants together with 
facilities and accessories thereto; to acquire, store, 
transport, sell, and conserve helium, helium-bearing natural 
gas, and helium-gas mixtures, to conduct exploration for and 
production of helium on and from the lands acquired, leased, or 
reserved; and to conduct or contract with public or private 
parties for experimentation and research to discover helium 
supplies and to improve processes and methods of helium 
production, purification, transportation, liquefaction, 
storage, and utilization: Provided, however, That all research 
contracted for, sponsored, cosponsored, or authorized under 
authority of this Act shall be provided for in such a manner 
that all information, uses, products, processes, patents and 
other developments resulting from such research developed by 
Government expenditure will (with such exceptions and 
limitations, if any, as the Secretary may find to be necessary 
in the interest of national defense) be available to the 
general public: And provided further, That nothing contained 
herein shall be construed as to deprive the owner of any 
background patent relating thereto to such rights as he may 
have thereunder.
    [Sec. 5. (a) Whenever the President determines that the 
defense, security, and general welfare of the United States 
requires such action, the Secretary shall issue such 
regulations as he deems necessary for the licensing of sales 
and transportation of helium in interstate commerce after 
extraction from helium-bearing natural gas or helium-gas 
mixtures. Thereafter it shall be unlawful for any person to 
sell or transfer helium in interstate commerce except in 
accordance with such regulations or pursuant to the terms of a 
license issued by the Secretary, or in accordance with the 
terms of a contract or agreement with the Secretary entered 
into pursuant to this Act. For the purpose of this section, the 
term `helium' shall mean helium, after extraction from helium-
bearing natural gas or helium-gas mixtures, in a refined or 
semirefined state suitable for use.
    [(b) Each license shall be issued for a specified period to 
be determined by the Secretary, but not exceeding 5 years, and 
may be renewed by the Secretary upon the expiration of such 
period. No such license shall be issued to a person if in the 
opinion of the Secretary the issuance of a license to such 
person would be inimical to the defense and security of the 
United States. No such license shall be assigned or otherwise 
transferred directly or indirectly except with the consent or 
approval of the Secretary in writing. Any such license may be 
revoked for any material false statement in the application for 
license, or for violation or a failure to comply with the terms 
and provisions of this Act, the regulations issued by the 
Secretary pursuant thereto, or the terms of the license.
    [(c) In issuing licenses under this section, the Secretary 
shall impose such regulations and terms of licenses as will 
permit him effectively to promote the common defense and 
security as well as the general welfare of the United States. 
The licensing authority herein granted shall be used solely for 
the purpose of preventing the transportation or sale of helium 
for end uses determined by the Secretary to be nonessential or 
wasteful, and any determination that any end use is 
nonessential or wasteful shall be published in the form of 
general regulations applicable to all transportation or sales 
of helium.
    [(d) Whenever Congress or the President declares that a war 
or national emergency exists, the Secretary is authorized to 
suspend any license granted under this Act if in his judgment 
such suspension is necessary to the defense and security of the 
United States, and he is further authorized to take such steps 
as may be necessary to recapture or reacquire supplies of 
helium.]

SEC. 3. AUTHORITY OF SECRETARY.

    (a) Extraction and Disposal of Helium on Federal Lands.--
(1) The Secretary may enter into agreements with private 
parties for the recovery and disposal of helium on Federal 
lands upon such terms and conditions as he deems fair, 
reasonable and necessary. The Secretary may grant leasehold 
rights to any such helium. The Secretary may not enter into any 
agreement by which the Secretary sells such helium other than 
to a private party with whom the Secretary has an agreement for 
recovery and disposal of helium. Such agreements may be subject 
to such rules and regulations as may be prescribed by the 
Secretary.
    (2) Any agreement under this subsection shall be subject to 
the existing rights of any affected Federal oil and gas lessee. 
Each such agreement (and any extension or renewal thereof) 
shall contain such terms and conditions as deemed appropriate 
by the Secretary.
    (3) This subsection shall not in any manner affect or 
diminish the rights and obligations of the Secretary and 
private parties under agreements to dispose of helium produced 
from Federal lands in existence at the enactment of the Helium 
Privatization Act of 1995 except to the extent that such 
agreements are renewed or extended after such date.
    (b) Storage, Transportation, and Sale.--The Secretary is 
authorized to store, transport, and sell helium only in 
accordance with this Act.
    (c) Monitoring and Reporting.--The Secretary is authorized 
to monitor helium production and helium reserves in the United 
States and to periodically prepare reports regarding the 
amounts of helium produced and the quantity of crude helium in 
storage in the United States.

SEC. 4. STORAGE, TRANSPORTATION, AND WITHDRAWAL OF CRUDE HELIUM.

    (a) Storage, Transportation, and Withdrawal.--The Secretary 
is authorized to store and transport crude helium and to 
maintain and operate existing crude helium storage at the 
Bureau of Mines Cliffside Field, together with related helium 
transportation and withdrawal facilities.
    (b) Cessation of Production, Refining, and Marketing.--
Effective 18 months after the date of enactment of the Helium 
Privatization Act of 1995, the Secretary shall cease producing, 
refining and marketing refined helium and shall cease carrying 
out all other activities relating to helium which the Secretary 
was authorized to carry out under this Act before the date of 
enactment of the Helium Privatization Act of 1995, except those 
activities described in subsection (a). The amount of helium 
reserves owned by the United States and stored in the Bureau of 
Mines Cliffside Field at such date of cessation, less 
600,000,000 cubic feet, shall be the helium reserves owned by 
the United States required to be sold pursuant to section 8(b) 
hereof.
    (c) Disposal of Facilities.--(1) Within two years after the 
date on which the Secretary ceases producing, refining and 
marketing refined helium and ceases all other activities 
relating to helium in accordance with subsection (b), the 
Secretary shall dispose of all facilities, equipment, and other 
real and personal property, together with all interests 
therein, held by the United States for the purpose of 
producing, refining and marketing refined helium. The disposal 
of such property shall be in accordance with the provisions of 
law governing the disposal of excess or surplus properties of 
the United States.
    (2) All proceeds acquiring to the United States by reason 
of the sale or other disposal of such property shall be treated 
as moneys received under this chapter for purposes of section 
6(f). All costs associated with such sale and disposal 
(including costs associated with termination of personnel) and 
with the cessation of activities under subsection (b) shall be 
paid from amounts available in the helium production fund 
established under section 6(f).
    (3) Paragraph (1) shall not apply to any facilities, 
equipment, or other real or personal property, or any interest 
therein, necessary for the storage and transportation of crude 
helium or any equipment needed to maintain the purity, quality 
control, and quality assurance of helium in the reserve.
    (d) Existing Contracts.--All contracts which were entered 
into by any person with the Secretary for the purchase by such 
person from the Secretary of refined helium and which are in 
effect on the date of the enactment of the Helium Privatization 
Act of 1995 shall remain in force and effect until the date of 
which the facilities referred to in subsection (c) are disposed 
of. Any costs associated with the termination of such contracts 
shall be paid from the helium production fund established under 
section 6(f).

SEC. 5. FEES FOR STORAGE, TRANSPORTATION AND WITHDRAWAL.

    Whenever the Secretary provides helium storage, withdrawal, 
or transportation services to any person, the Secretary is 
authorized and directed to impose fees on such person to 
reimburse the Secretary for the full costs of providing such 
storage, transportation, and withdrawal. All such fees received 
by the Secretary shall be treated as moneys received under this 
Act for purposes of section 6(f).
    Sec. 6. (a) The Department of Defense, the Atomic Energy 
Commission, and other agencies of the Federal Government, to 
the extent that supplies are readily available, shall purchase 
all major requirements of helium [from the Secretary] from 
persons who have entered into enforceable contracts to purchase 
an equivalent of crude helium from the Secretary.
    (b) The Secretary is authorized to sell crude helium for 
Federal, medical, scientific, and commercials uses in such 
quantities and under such terms and conditions as he 
determines. Except as may be required by reason of subsection 
(a), the Secretary shall not make sales of crude helium under 
this section in such amounts as well disrupt the market price 
of crude helium.
    (c) Sales of crude helium by the Secretary shall be at 
prices established by him which shall be adequate to cover all 
costs incurred in carrying out the provisions of this Act and 
to repay to the United States by deposit in the Treasury, 
[together with interest as provided in subsection (d) of this 
section, the following:
          [(1) Within 25 years from the date of enactment of 
        the Helium Act Amendments of 1960, the net capital and 
        retained earnings of the helium production fund 
        (established under section 3 of this Act prior to 
        amendment by the Helium Act Amendments of 1960), 
        determined by the Secretary as of such date of 
        enactment, plus any moneys expended thereafter by the 
        Department of the Interior from funds provided in the 
        Supplemental Appropriation Act, 1959, for construction 
        of a helium plant at Keyes, Oklahoma;
          [(2) Within 25 years from the date of borrowing, all 
        funds borrowed, as provided in section 12 of this Act, 
        to acquire and construct helium plants and facilities; 
        and
          [(3) Within 25 years from the date of enactment of 
        the Helium Act Amendments of 1960, unless the Secretary 
        determines that said period should be extended for not 
        more than ten years, all funds borrowed, as provided in 
        section 12 of this Act, for all purposes other than 
        those specified in clause (2) above.] all funds 
        required to be repaid to the United States as of 
        October 1, 1995, under this section (hereinafter 
        referred to as ``repayable amounts''). The price at 
        which crude helium is sold by the Secretary shall not 
        be less than the amount determined by the Secretary as 
        follows:
          (1) Divide the outstanding amount of such repayable 
        amounts by the volume (in mcf) of crude helium owned by 
        the United States and stored in the Bureau of Mines 
        Cliffside Field at the time of the sale concerned.
          (2) Adjust the amount determined under paragraph (1) 
        by the Consumer Price Index for years beginning after 
        December 31, 1995.
    [(d) Compound interest on the amounts specified in clauses 
(1), (2), and (3) of subsection (c) which have not been paid to 
the Treasury shall be calculated annually at rates determined 
by the Secretary of the Treasury taking into consideration the 
current average market yields of outstanding marketable 
obligations of the United States having maturities comparable 
to the investments authorized by this Act, except that the 
interest rate on the amounts specified in clause (1) of 
subsection (c) shall be determined as of the date of enactment 
of the Helium Act Amendments of 1960, and the interest rate on 
the obligations specified in clauses (2) and (3) of subsection 
(c) as of the time of each borrowing.
    [(e) Helium shall be sold for medical purposes at prices 
which will permit its general use therefor; and all sales of 
helium to non-Federal purchasers shall be upon condition that 
the Federal Government shall have a right to repurchase helium 
so sold that has not been lost or dissipated, when needed for 
Government use, under terms and at prices established by 
regulations.]
    (d) Extraction of Helium From Deposits on Federal Lands.--
All moneys received by the Secretary from the sale or 
disposition of helium on Federal lands shall be paid to the 
Treasury and credited against the amounts required to be repaid 
to the Treasury under subsection (c) of this section.
    (f)(1) All moneys received under this Act, including moneys 
from sale of helium or other products resulting from helium 
operations and from the sale of excess property shall be 
credited to the helium production fund, which shall be 
available without fiscal year limitation, for carrying out the 
provisions of this Act, including any research relating to 
helium carried out by the Department of the Interior. Amounts 
accumulating in said fund in excess of amounts the Secretary 
deems necessary to carry out this Act and contracts negotiated 
hereunder shall be paid to the Treasury and credited against 
the amounts required to be repaid to the Treasury under 
subsection (c) of this section.
    (2) Within 7 days after the commencement of each fiscal 
year after the disposal of the facilities referred to in 
section 4(c), all amounts in such fund in excess of $2,000,000 
(or such lesser sum as the Secretary deems necessary to carry 
out this Act during such fiscal year) shall be paid to the 
Treasury and credited as provided in paragraph (1). Upon 
repayment of all amounts referred to in subsection (c), the 
fund established under this section shall be terminated and all 
moneys received under this Act shall be deposited in the 
Treasury as General Revenues.
          * * * * * * *
    [Sec. 8. (a) Proceedings for the condemnation of any 
property under section 3 of this Act shall be instituted and 
maintained pursuant to the provisions of the Act of August 1, 
1888 (25 Stat. 357; 40 U.S.C. 257), as amended, and sections 
1358 and 1403 of title 28 of the United States Code, or any 
other Federal statute applicable to the acquisition of real 
property by eminent domain. The Acts of February 26, 1931 (46 
Stat. 1421; 40 U.S.C. 258a-258e), and October 21, 1942 (56 
Stat. 797; 40 U.S.C. 258f), shall be applicable to any such 
proceedings. Wherever the words ``real property'', ``realty'', 
``land'', ``easement'', ``right-of-way'', or words of similar 
meaning, are used in such code provisions or Acts relating to 
procedure, jurisdiction, and venue, they shall be deemed, for 
the purposes of this Act, to include any personal property 
authorized to be acquired hereunder.
    [(b) In the event of disposal under section 3(a)(4) of this 
Act of any property acquired by eminent domain pursuant to this 
Act, the former owner or successor in interest of the rights 
therein shall have the preferential right to reacquire such 
property on terms as favorable as those terms whereby 
disposition may be made under such section.]

SEC. 8. ELIMINATION OF STOCKPILE.

    (a) Review of Reserves.--The Secretary shall review 
annually the known helium reserves in the United States and 
make a determination as to the expected life of the domestic 
helium reserves (other than Federally owned helium stored at 
the Cliffside Reservoir) at that time.
    (b) Stockpile Sales.--Not later than January 1, 2005, the 
Secretary shall commence offering for sale crude helium from 
helium reserves owned by the United States in such minimum 
annual amounts as would be necessary to dispose of all such 
helium reserves in excess of 600,000,000 cubic feet (mcf) on a 
straight-line basis between such date and January 1, 2015: 
Provided, That the minimum price for all such sales, as 
determined by the Secretary in consultation with the helium 
industry, shall be such as will ensure repayment of the amounts 
required to be repaid to the Treasury under section 6(c), and 
provided further that the minimum annual sales requirement may 
be deferred only if, and to the extent that, the Secretary is 
unable to arrange sales at the minimum price. The sales shall 
be at such times during each year and in such lots as the 
Secretary determines, in consultation with the helium industry, 
are necessary to carry out this subsection with minimum market 
disruption.
    (c) Discovery of Additional Reserves.--The discovery of 
additional helium reserves shall not affect the duty of the 
Secretary to make sales of helium as provided in subsection 
(b), as the case may be.
          * * * * * * *
    [Sec. 12. (a) The Secretary is authorized to borrow 
annually from the Treasury and credit to the fund established 
under section 6(f) of this Act such amounts as may be 
authorized in the initial appropriation Act and which may be 
increased from time to time in appropriation Acts and as are 
necessary to carry out the provisions of this Act and 
contractual obligations hereunder.
    [(b) For the purpose of this section the Secretary may 
issue to the Secretary of the Treasury notes, debentures, 
bonds, or other obligations to be redeemable at the option of 
the Secretary before maturity in such manner as may be 
stipulated in such obligations. The Secretary of the Treasury 
is authorized and directed to purchase any obligations issued 
by the Secretary under authority of this section and for such 
purpose the Secretary of the Treasury is authorized to use as a 
public debt transaction the proceeds from the sale of any 
securities issued under the Second Liberty Bond Act, as 
amended, and the purposes for which securities may be issued 
under the Second Liberty Bond Act, as amended, are extended to 
include any purchases of obligations of the Secretary 
hereunder.]
          * * * * * * *
    [Sec. 15. It is the sense of the Congress that it is in the 
national interest to foster and encourage individual enterprise 
in the development and distribution of supplies of helium, and 
at the same time provide, within economic limits, through the 
administration of this Act, a sustained supply of helium which, 
together with supplies available or expected to become 
available otherwise, will be sufficient to provide for 
essential Government activities.]
    Sec. 16. (a) The Secretary of the Interior is directed to 
report annually to the Congress on the matters contained in 
this Act.
    (b)(1) The Inspector General of the Department of the 
Interior shall cause to be prepared, not later than March 31 
following each fiscal year commencing with the date of 
enactment of the Helium Privatization Act of 1995, annual 
financial statements for the Helium Operations of the Bureau of 
Mines. The Director of the Bureau of Mines shall cooperate with 
the Inspector General in fulfilling this requirement, and shall 
provide him with such personnel and accounting assistance as 
may be necessary for that purpose. The financial statements 
shall be audited by the General Accounting Office, and a report 
on such audit shall be delivered by the General Accounting 
Office to the Secretary of the Interior and Congress, not later 
than June 30 following the end of the fiscal year for which 
they are prepared. The audit shall be prepared in accordance 
with generally accepted government auditing standards.
    (2) The financial statements shall be comprised of the 
following:
          (A) A balance sheet reflecting the overall financial 
        position of the Helium Operations, including assets and 
        liabilities thereof;
          (B) the Statement of Operations, reflecting the 
        fiscal period results of the Helium Operations;
          (C) a statement cash flows or changes in financial 
        position of the Helium Operations; and
          (D) a reconciliation of budget reports of the Helium 
        Operations.
    (3) The Statement of Operations shall include but not be 
limited to the revenues from, and costs of, sales of crude 
helium, the storage and transportation of crude helium, the 
production, refining and marketing of refined helium, and the 
maintenance and operation of helium storage facilities at the 
Bureau of Mines Cliffside Field. The term ``revenues'' for this 
purpose shall exclude (A) royalties paid to the United States 
for production of helium or other extraction of resources, 
except to the extent that the Helium Operations incur direct 
costs in connection therewith, and (B) proceeds from sales of 
assets other than inventory. The term ``expenses'' shall 
include, but not be limited to (i) all labor costs of the 
Bureau of Mines Helium Operations, and of the Department of the 
Interior in connection therewith, and (ii) for financial 
reporting purposes but not in connection with the determination 
of sales prices in section 6(c), all current-period interest on 
outstanding repayable amounts (as described in section 6(c)) 
calculated at the same rates as such interest was calculated 
prior to the enactment of the Helium Privatization Act of 1995.
    (4) The balance sheet shall include, but not be limited to, 
on the asset side, the present discounted market value of crude 
helium reserves; and on the liability side, the accrued 
liability for principal and interest on debt to the United 
States. For financial reporting purposes but not connection 
with the determination of sales prices in section 6(c), the 
balance sheet shall also include accrued but unpaid interest on 
outstanding repayable amounts (as described in section 6(c)) 
through the date of the report, calculated at the same rates as 
such interest was calculated prior to the enactment of the 
Helium Privatization Act of 1995.
          * * * * * * *
                              ----------                              


 SECTION 505 OF THE ENERGY AND WATER DEVELOPMENT APPROPRIATIONS ACT OF 
                                  1933

    [Sec. 505. Notwithstanding any other provision of this Act, 
subsequent Energy and Water Development Appropriations Acts or 
any other provision of law hereafter, none of the funds made 
available under this Act, subsequent Energy and Water 
Development Appropriations Acts or any other law hereafter 
shall be used for the purposes of conducting any studies 
relating or leading to the possibility of changing from the 
currently required ``at cost'' to a ``market rate'' or any 
other noncost-based method for the pricing of hydroelectric 
power by the six Federal public power authorities, or other 
agencies or authorities of the Federal Government, except as 
may be specifically authorized by Act of Congress hereafter 
enacted.]
                              ----------                              


SECTION 6 OF THE CONFEDERATED TRIBES OF THE COLVILLE RESERVATION GRAND 
                       COULEE DAM SETTLEMENT ACT

[SEC. 6. REPAYMENT CREDIT.

    [Beginning with fiscal year 2000 and continuing for so long 
as annual payments are made under this Act, the Administrator 
shall deduct from the interest payable to the Secretary of the 
Treasury from net proceeds as defined in section 13 of the 
Federal Columbia River Transmission System Act, an amount equal 
to 26 percent of the payment made to the Tribe for the prior 
fiscal year. Each deduction made under this section shall be a 
credit to the interest payments otherwise payable by the 
Administrator to the Secretary of the Treasury during the 
fiscal year in which the deduction is made, and shall be 
allocated pro rata to all interest payments on debt associated 
with the generation function of the Federal Columbia River 
Power System that are due during that fiscal year; except that, 
if the deduction in any fiscal year is greater than the 
interest due on debt associated with the generation function 
for that fiscal year, then the amount of the deduction that 
exceeds the interest due on debt associated with the generation 
function shall be allocated pro rata to all other interest 
payments due during that fiscal year. To the extent that the 
deduction exceeds the total amount of any such interest, the 
deduction shall be applied as a credit against any other 
payments that the Administrator makes to the Secretary.]

SEC. 6. CREDITS TO ADMINISTRATOR'S PAYMENTS TO THE UNITED STATES 
                    TREASURY.

    (a) In General.--So long as the Administrator makes annual 
payments to the tribes under the settlement agreement, the 
Administrator shall apply against amounts otherwise payable by 
the Administrator to the United States Treasury a credit that 
reduces the Administrator's payment in the amount and for each 
fiscal year as follows: $15,250,000 in fiscal year 1996; 
$15,860,000 in fiscal year 1997; $16,490,000 in fiscal year 
1998; $17,150,000 in fiscal year 1999; $17,840,000 in fiscal 
year 2000; and $4,100,000 in each succeeding fiscal year.
    (b) Definitions.--For the purposes of this section--
          (1) The term ``settlement agreement'' means that 
        settlement agreement between the United States of 
        America and the Confederated Tribes of the Colville 
        Reservation signed by the Tribes on April 16, 1994, and 
        by the United States of America on April 21, 1994, 
        which settlement agreement resolves claims of the 
        Tribes in Docket 181-D of the Indian Claims Commission, 
        which docket has been transferred to the United States 
        Court of Federal Claims; and
          (2) The term ``Tribes'' means the Confederated Tribes 
        of the Colville Reservation, a Federally recognized 
        Indian Tribe.
                              ----------                              


         SECTION 210 OF THE CENTRAL UTAH PROJECT COMPLETION ACT

SEC. 210. JORDAN AQUEDUCT PREPAYMENT.

    Under such terms as the Secretary may prescribe, and within 
one year of the date of enactment of this Act, the Secretary 
shall allow for the prepayment, or shall otherwise dispose of, 
repayment contracts entered into among the United States, the 
District, the Metropolitan Water District of Salt Lake City, 
and the Salt Lake County Water Conservancy District, dated May 
16, 1986, providing for repayment of the Jordan Aqueduct 
System. [In carrying out this section, the Secretary shall take 
such actions as he deems appropriate to accommodate, 
effectuate, and otherwise protect the rights and obligations of 
the United States and the obligors under the contracts executed 
to provide for payment of such repayment contracts.] The 
Secretary of the Interior shall allow for prepayment of the 
repayment contract between the United States and the Central 
Utah Water Conservancy District dated December 28, 1965, and 
supplemented on November 26, 1985, providing for repayment of 
the municipal and industrial water delivery facilities for 
which repayment is provided pursuant to such contract, under 
such terms and conditions as the Secretary deems appropriate to 
protect the interest of the United States, which shall be 
similar to the terms and conditions contained in the 
supplemental contract that provided for the prepayment of the 
Jordan Aqueduct dated October 28, 1993. The District shall 
exercise its right to prepayment pursuant to this section by 
the end of fiscal year 2002.

               SECTION 7 OF THE ACT OF DECEMBER 19, 1913

   CHAP. 4.--An Act Granting to the city and county of San Francisco 
 certain rights of way in, over, and through certain public lands, the 
  Yosemite National Park, and Stanislaus National Forest, and certain 
 lands in the Yosemite National Park, the Stanislaus National Forest, 
    and the public lands in the State of California, and for other 
                               purposes.

    Sec. 7. That for and in consideration of the grant by the 
United States as provided for in this Act the said grantee 
shall assign, free of cost to the United States, all roads and 
trails built under the provisions hereof; and further, after 
the expiration of 5 years from the passage of this Act the 
grantee shall pay to the United States the sum of $15,000 
annually for a period of 10 years, beginning with the 
expiration of the 5-year period before mentioned, and for the 
next ten years following $20,000 annually, and for the 
remainder of the term of the grant shall, unless in the 
discretion of Congress the annual charge should be increased or 
diminished, pay the sum of [$30,000] $8,000,000 annually, said 
sums to be paid on the first day of July of each year. [Until 
otherwise provided by Congress, said sums shall be kept in a 
separate fund by the United States, to be applied to the 
building and maintenance of roads and trails and other 
improvements in the Yosemite National Park and other national 
parks in the State of California. The Secretary of the Interior 
shall designate the uses to be made of sums paid under the 
provisions of this section under the conditions specified 
herein.] These funds shall be placed in a separate fund by the 
United States and, notwithstanding any other provision of law, 
shall not be available for obligation or expenditure until 
appropriated by the Congress. The highest priority use of the 
funds shall be for annual operation of Yosemite National Park, 
with the remainder of any funds to be used to fund operations 
of other national parks in the State of California.

                         ACT OF OCTOBER 9, 1965

  [AN ACT Relating to the establishment of concession policies in the 
  areas administered by National Park Service and for other purposes.

    Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That in 
furtherance of the Act of August 25, 1916 (39 Stat. 535), as 
amended (16 U.S.C. 1), which directs the Secretary of the 
Interior to administer national park system areas in accordance 
with the fundamental purposes of conserving their scenery, 
wildlife, natural and historic objects, and providing for their 
enjoyment in a manner that will leave them unimpaired for the 
enjoyment of future generations, the Congress hereby finds that 
the preservation of park values requires that such public 
accommodations, facilities, and services as have to be provided 
within those areas should be provided only under carefully 
controlled safeguards, against unregulated and indiscriminate 
use, so that the heavy visitation will not unduly impair these 
values and so that development of such facilities can best be 
limited to locations where the least damage to park values will 
be caused. It is the policy of the Congress that such 
development shall be limited to those that are necessary and 
appropriate for public use and enjoyment of the national park 
area in which they are located and that are consistent to the 
highest practicable degree with the preservation and 
conservation of the areas.
    [Sec. 2. Subject to the findings and policy stated in 
section 1 of this Act, the Secretary of the Interior shall take 
such action as may be appropriate to encourage and enable 
private persons and corporations (hereinafter referred to a 
``concessioners'') to provide and operate facilities and 
services which he deems desirable of the accommodation of 
visitors in areas administered by the National Park Service.
    [Sec. 3. (a) Without limitation of the foregoing, the 
Secretary may include in contracts for the providing of 
facilities and services such terms and conditions as, in his 
judgment, are required to assure the concessioner of adequate 
protection against loss of investment in structures, fixtures, 
improvements, equipment, supplies, and other tangible property 
provided by him for the purposes of the contract (but not 
against loss of anticipated profits) resulting from 
discretionary acts, policies, or decisions of the Secretary 
occurring after the contract has become effective under which 
acts, policies, or decisions the concessioner's authority to 
conduct some or all of his authorized operations under the 
contract ceases or his structures, fixtures, and improvements, 
or any of them, are required to be transferred to another party 
or to be abandoned, removed, or demolished. Such terms and 
conditions may include an obligation of the United States to 
compensate the concessioner for loss of investment, as 
aforesaid.
    [(b) The Secretary shall exercise his authority in a manner 
consistent with a reasonable opportunity for the concessioner 
to realize a profit on his operation as a whole commensurate 
with the capital invested and the obligations assumed.
    [(c) The reasonableness of a concessioner's rates and 
charges to the public shall, unless otherwise provided in the 
contract, be judged primarily by comparison with those current 
for facilities and services of comparable character under 
similar conditions, with due consideration for length of 
season, provision for peakloads, average percentage of 
occupancy, accessibility, availability and costs of labor and 
materials, type of patronage, and other factors deemed 
significant by the Secretary.
    [(d) Franchise fees, however, states, shall be determined 
upon consideration of the probable value to the concessioner of 
the privileges granted by the particular contract or permit 
involved. Such value is the opportunity for net profit in 
relation to both gross receipts and capital invested. 
Consideration of revenue to the United States shall be 
subordinate to the objectives of protecting and preserving the 
areas and of providing adequate and appropriate services for 
visitors at reasonable rates. Appropriate provisions shall be 
made for reconsideration of franchise fees at least every 5 
years unless the contract is for a lesser period of time.
    [Sec. 4. The Secretary may authorize the operation of all 
accommodations facilities, and services for visitors, or of all 
such accommodations, facilities, and services of generally 
similar character, in each area, or portion thereof, 
administered by the National Park Service by one responsible 
concessioner and may grant to such concessioner a preferential 
right to provide such new or additional accommodations, 
facilities, or services as the Secretary may consider necessary 
or desirable for the accommodation and convenience of the 
public. The Secretary may, in his discretion, grant extensions, 
renewals, or new contracts to present concessioners, other than 
the concessioner holding a preferential right, for operations 
substantially similar in character and extent to those 
authorized by their current contracts or permits.
    [Sec. 5. The Secretary shall encourage continuity of 
operation and facilities and services by giving preference in 
the renewal of contracts or permits and in the negotiation of 
new contracts or permits to the concessioners who have 
performed their obligations under prior contracts or permits to 
the satisfaction of the Secretary. To this end, the Secretary, 
at any time in his discretion, may extend or renew a contract 
or permit, or may grant a new contract or permit to the same 
concessioner upon the termination or surrender before 
expiration of a prior contract or permit. Before doing so, 
however, and before granting extensions, renewals or new 
contracts pursuant to the last sentence of section 4 of this 
Act, the Secretary shall give reasonable public notice of his 
intention so to do and shall consider and evaluate all 
proposals received as a result thereof.
    [Sec. 6. A concessioner who has heretofore acquired or 
constructed or who hereafter acquires or constructs, pursuant 
to a contract and with the approval of the Secretary, any 
structure, fixture, or improvement upon land owned by the 
United States within an area administered by the National Park 
Service shall have a possessory interest therein, which shall 
consist of all incidents of ownership except legal title, and 
except as hereinafter provided, which title shall be vested in 
the United States. Such possessory interest shall not be 
construed to include or imply any authority, privilege, or 
right to operate or engage in any business or other activity, 
and the use or enjoyment of any structure, fixture, or 
improvement in which the concessioner has a possessory interest 
shall be wholly subject to the applicable provisions of the 
contract and of laws and regulations relating to the area. The 
said possessory interest shall not be extinghished by the 
expiration or other termination of the contract and may not be 
taken for public use without just compensation. The said 
possessory interest may be assigned, transferred, encumbered, 
or relinquished. Unless otherwise provided by agreement of the 
parties, just compensation shall be an amount equal to the 
sound value of such structure, fixture, or improvement at the 
time of taking by the United States determined upon the basis 
of reconstruction cost less depreciation evidenced by its 
condition and prospective serviceability in comparison with a 
new unit of like kind, but not to exceed fair market value. The 
provisions of this section shall not apply to concessioners 
whose current contracts do not include recognition of a 
possessory interest, unless in a particular case the Secretary 
determines that equitable considerations warrant recognition of 
such interest.
    [Sec. 7. The provisions of section 321 of the Act of June 
30, 1932 (47 Stat. 412; 40 U.S.C. 303(b)), relating to the 
leasing of buildings and properties of the United States, shall 
not apply to privileges, leases, permits, and contracts granted 
by the Secretary of the Interior for the use of lands and 
improvements thereon, in area administered by the National Park 
Service, for the purpose of providing accommodations, 
facilities, and services for visitors thereto, pursuant to the 
Act of August 25, 1916 (39 Stat. 535), as amended, or the Act 
of August 21, 1935, chapter 593 (49 Stat. 666; 16 U.S.C. 461-
467), as amended.
    [Sec. 8. Subsection (h) of section 2 of the Act of August 
21, 1935, the Historical Sites, Buildings, and Antiquities Act 
(49 Stat. 666; 16 U.S.C. 462(h)), is amended by changing the 
proviso therein to read as follows: ``Provided, That the 
Secretary may grant such concessions, leases, or permits and 
enter into contracts relating to the same with responsible 
persons, firms, or corporations without advertising and without 
securing competitive bids.''
    [Sec. 9. Each concessioner shall keep such records as the 
Secretary may prescribe to enable the Secretary to determine 
that all terms of the concession contract have been and are 
being faithfully performed, and the Secretary and his duly 
authorized representatives shall, for the purpose of audit and 
examination, have access to said records and to other books, 
documents, and papers of the concessioner pertinent to the 
contract and all the terms and conditions thereof.
    [The Comptroller General of the United States or any of his 
duly authorized representatives shall, until the expiration of 
five (5) calendar years after the close of the business year of 
each concessioner or subconcessioner have access to and the 
right to examine any pertinent books, documents, papers, and 
records of the concessioner or subconcessioner related to the 
negotiated contract or contracts involved.]
                              ----------                              


                          ACT OF MARCH 4, 1915

    CHAP. 144.--An Act Making appropriations for the Department of 
Agriculture for the fiscal year ending June thirtieth, nineteen hundred 
                              and sixteen.

          * * * * * * *

                             FOREST SERVICE

          * * * * * * *
    [The Secretary of Agriculture is authorized, under such 
regulations as he may make and upon such terms and conditions 
as he may deem proper, (a) to permit the use and occupancy of 
suitable areas of land within the national forests, not 
exceeding eighty acres and for periods not exceeding thirty 
years, for the purpose of constructing or maintaining hotels, 
resorts, and any other structures of facilities necessary or 
desirable for recreation, public convenience, or safety; (b) to 
permit the use and occupancy of suitable areas of land within 
the national forests, not exceeding five acres and for periods 
not exceeding thirty years, for the purpose of constructing or 
maintaining summer homes and stores; (c) to permit the use and 
occupancy of suitable areas of land within the national forest, 
not exceeding eighty acres and for periods not exceeding thirty 
years, for the purpose of constructing or maintaining 
buildings, structures, and facilities for industrial or 
commercial purposes whenever such use is related to or 
consistent with other uses on the national forests; (d) to 
permit any State or political subdivision thereof, or any 
public or nonprofit agency, to use and occupy suitable areas of 
land within the national forests not exceeding eighty acres and 
for periods not exceeding thirty years, for the purpose of 
constructing or maintaining any buildings, structures, or 
facilities necessary or desirable for education or for any 
public use or in connection with any public activity. The 
authority provided by this paragraph shall be exercised in such 
manner as not to preclude the general public from full 
enjoyment of the natural, scenic, recreational, and other 
aspects of the national forests.]
          * * * * * * *
                              ----------                              


                         ACT OF APRIL 24, 1950

 AN ACT To facilitate and simplify the work of the Forest Service, and 
                          for other purposes.

          * * * * * * *
    [Sec. 7. The Secretary of Agriculture, under such 
regulations as he may prescribe and at rates and for periods 
not exceeding thirty years as determined by him, is hereby 
authorized to permit the use by public and private agencies, 
corporations, firms, associations, or individuals, of 
structures or improvements under the administrative control of 
the Forest Service and land used in connection therewith: 
Provided, That as all or a part of the consideration for 
permits issued under this section, the Secretary may require 
the permittees at their expense to recondition and maintain the 
structures and land to a satisfactory standard.]
          * * * * * * *
                              ----------                              


                SECTION 3 OF THE ACT OF AUGUST 25, 1916

CHAP. 408.--An Act To Establish a National Park Service, and for other 
                               purposes.

    Sec. 3. That the Secretary of the Interior shall make and 
publish such rules and regulations as he may deem necessary or 
proper for the use and management of the parks, monuments, and 
reservations under the jurisdiction of the National Park 
Service, and any violation of any of the rules and regulations 
authorized by this Act shall be punished by a fine of not more 
than $500 or imprisonment for not exceeding six months, or 
both, and be adjudged to pay all cost of the proceedings. He 
may also, upon terms and conditions to be fixed by him, sell or 
dispose of timber in those cases where in his judgment the 
cutting of such timber is required in order to control the 
attacks of insects or diseases or otherwise conserve the 
scenery or the natural or historic objects in any such park, 
monument, or reservation. He may also provide in his discretion 
for the destruction of such animals and of such plant life as 
may be detrimental to the use of any of said parks, monuments, 
or reservations. [He may also grant privileges, leases, and 
permits for the use of land for the accommodation of visitors 
in the various parks, monuments, or other reservations herein 
provided for, but for periods not exceeding thirty years; and 
no] No natural curiosities, wonders, or objects of interest 
shall be leased, rented, or granted to anyone on such terms as 
to interfere with free access to them by the public: Provided, 
however, That the Secretary of the Interior may, under such 
rules and regulations and on such terms as he may prescribe, 
grant the privilege to graze livestock within any national 
park, monument, or reservation herein referred to when in his 
judgment such use is not detrimental to the primary purpose for 
which such park, monument, or reservation was created, except 
that this provision shall not apply to the Yellowstone National 
Park And provided further, That the Secretary of the Interior 
may grant said privileges, leases, and permits and enter into 
contracts relating to the same with responsible persons, firms, 
or corporations without advertising and without securing 
competitive bids: And provided further, That no contract, 
lease, permit, or privilege granted shall be assigned or 
transferred by such grantees, permittees, or licensees, without 
the approval of the Secretary of the Interior first obtained in 
writting: And provided further, That the Secretary may, in his 
discretion, authorize such grantees, permittees, or licensees 
to execute mortgages and issue bonds, shares to stock, and 
other evidences of interest in or indebtedness upon their 
rights, properties, and franchises, for the purposes of 
installing, enlarging, or improving plant and equipment and 
extending facilities for the accommodation of the public within 
such national parks and monuments.
                              ----------                              


               SECTION 4 OF THE ACT OF DECEMBER 22, 1944

 AN ACT Authorizing the construction of certain public works on rivers 
         and harbors for flood control, and for other purposes.

    Sec. 4. The Chief of Engineers, under the supervision of 
the Secretary of the Army, is authorized to construct, 
maintain, and operate public park and recreational facilities 
at water resource development projects under the control of the 
Department of the Army, to permit the construction of such 
facilities by local interests (particularly those to be 
operated and maintained by such interests), and to permit the 
maintenance and operation of such facilities by local 
interests. The Secretary of the Army is also authorized to 
grant leases of lands, including structures or facilities 
thereon, at water resource development projects for such 
periods, and upon such terms and for such purposes as he may 
deem reasonable in the public interest, except for commercial 
concessions purposes: Provided, That leases to nonprofit 
organizations for park or recreational purposes may be granted 
at reduced or nominal considerations in recognition of the 
public service to be rendered in utilizing the leased premises: 
Provided further, That preference shall be given to Federal, 
State, or local governmental agencies, and licenses or leases 
where appropriate, may be granted without monetary 
considerations, to such agencies for the use of all or any 
portion of a project area for any public purpose, when the 
Secretary of the Army determines such action to be in the 
public interest, and for such periods of time and upon such 
conditions as he may find advisable: And provided further, That 
in any such lease or license to a Federal, State, or local 
governmental agency which involves lands to be utilized for the 
development and conservation of fish and wildlife, forests, and 
other natural resources, the licensee or lessee may be 
authorized to cut timber and harvest crops as may be necessary 
to further such beneficial uses and to collect and utilize the 
proceeds of any sales of timber and crops in the development, 
conservation, maintenance, and utilization of such lands. Any 
balance of proceeds not so utilized shall be paid to the United 
States at such time or times as the Secretary of the Army may 
determine appropriate. The water areas of all such projects 
shall be open to public use generally for boating, swimming, 
bathing, fishing, and other recreational purposes, and ready 
access to and exit from such areas along the shores of such 
projects shall be maintained for general public use, when such 
use is determined by the Secretary of the Army not to be 
contrary to the public interest, all under such rules and 
regulations as the Secretary of the Army may deem necessary. No 
use of any area to which this section applies shall be 
permitted which is inconsistent with the laws for the 
protection of fish and game of the State in which such area is 
situated. All moneys received by the United States for leases 
or privileges shall be deposited in the Treasury of the United 
States as miscellaneous receipts.
                              ----------                              


              NATIONAL FOREST SKI AREA PERMIT ACT OF 1986

          * * * * * * *

SEC. 4. SKI AREA PERMIT FEES.

    (a) Ski Area Permit Fee.--
          (1) In general.--Except as provided by paragraph (2), 
        after the date of the enactment of this section, the 
        fee for all ski area permits on National Forest System 
        lands shall be calculated, charged, and paid only as 
        set forth in subsection (b).
          (2) Exception.--Paragraph (1) does not apply to any 
        ski area where the existing permit in effect on the 
        date of enactment of this section specifies a different 
        method to calculate the fee. In any such situation the 
        terms of such permit shall prevail, unless the permit 
        holder notifies the Forest Service that the permit 
        holder agrees to adopt the method of fee calculation 
        specified in this section. The Forest Service should 
        encourage such permit holders to consider adopting the 
        new method of fee calculation in order to reduce its 
        administrative costs.
    (b) Method of Calculation.--
          (1) Determination of adjusted gross revenue subject 
        to fee.--The Secretary of Agriculture shall calculate 
        the ski area permit fee to be charged a ski area 
        permittee by first determining the permittee's adjusted 
        gross revenue to be subject to the permit fee. The 
        permittee's adjusted gross revenue is equal to the sum 
        of the following:
                  (A) The permittee's gross revenues from 
                alpine lift ticket and alpine season pass sales 
                plus revenue from alpine ski school operations, 
                with such total multiplied by the permittee's 
                slope transport feet percentage on National 
                Forest System lands.
                  (B) The permittee's gross revenues from 
                nordic ski use pass sales and nordic ski school 
                operations, with such total multiplied by the 
                permittee's percentage of nordic trails on 
                National Forest System lands.
                  (C) The permittee's gross revenues from 
                ancillary facilities physically located on 
                National Forest System lands, including all 
                permittee or subpermittee lodging, food 
                service, rental shops, parking, and other 
                ancillary operations.
          (2) Determination of ski area permit fee.--The 
        Secretary shall determine the ski area permit fee to be 
        charged a ski area permittee by multiplying adjusted 
        gross revenue determined under paragraph (1) for the 
        permittee by the following percentages for each revenue 
        bracket and adding the total for each revenue bracket:
                  (A) 1.5 percent of all adjusted gross revenue 
                below $3,000,000.
                  (B) 2.5 percent for adjusted gross revenue 
                between $3,000,000 and $15,000,000.
                  (C) 2.75 percent for adjusted gross revenue 
                between $15,000,000 and $50,000,000.
                  (D) 4.0 percent for the amount of adjusted 
                gross revenue that exceeds $50,000,000.
          (3) Slope transport feet percentage.--In cases where 
        ski areas are only partially located on National Forest 
        System lands, the slope transport feet percentage on 
        national forest land referred to in paragraph (1) shall 
        be calculated as generally described in the Forest 
        Service Manual in effect as of January 1, 1992.
          (4) Annual adjustment of adjusted gross revenue.--In 
        order to insure that the ski area permit fee set forth 
        in this subsection remains fair and equitable to both 
        the United States and ski area permittees, the 
        Secretary shall adjust, on an annual basis, the 
        adjusted gross revenue figures for each revenue bracket 
        in subparagraphs (A) through (D) of paragraph (2) by 
        the percent increase or decrease in the national 
        Consumer Price Index for the preceding calendar year.
    (c) Minimum Fee.--In cases where an area of National Forest 
System land is under a ski area permit but the permittee does 
not have revenue or sales qualifying for fee payment pursuant 
to subsection (a), the permittee shall pay an annual minimum 
fee of $2 for each acre of National Forest System land under 
permit. Rental fees imposed under this subsection shall be paid 
at the time specified in subsection (d).
    (d) Time for Payment.--The fee set forth in subsection (b) 
shall be due on June 1 of each year and shall be paid or 
prepaid by the permittee on a monthly, quarterly, annual, or 
other schedule as determined appropriate by the Secretary in 
consultation with the permittee. It is the intention of 
Congress that unless mutually agreed otherwise by the Secretary 
and the permittee, the payment or prepayment schedule shall 
conform to the permittee's schedule in effect prior to the 
enactment of this section. To simplify bookkeeping and fee 
calculation burdens on the permittee and the Forest Service, 
the Secretary shall each year provide the permittee with a 
standardized form and worksheets (including annual fee 
calculations brackets and rates) to be utilized for fee 
calculation and submitted with the fee payment. Information 
provided on such forms shall be compiled by the Secretary 
annually and kept in the Office of the Chief, United States 
Forest Service.
    (e) Definitions.--To simplify bookkeeping and 
administrative burdens on ski area permittees and the Forest 
Service, as used in this section, the terms ``revenue'' and 
``sales'' mean actual income from sales. Such terms do not 
include sales of operating equipment, refunds, rent paid to the 
permittee by sublessees, sponsor contributions to special 
events or any amounts attributable to employee gratuities, 
discounts, complimentary lift tickets, or other goods or 
services (except for bartered goods) for which the permittee 
does not receive money.
    (f) Effective Date for Fees.--The ski area permit fees as 
provided under this section shall become effective on July 1, 
1996, and cover receipts retroactive to July 1, 1995. If a ski 
area permittee has paid fees for the 12-month period ending on 
June 30, 1996, under the graduated rate fee system formula in 
effect prior to the date of the enactment of this section, such 
fees shall be credited toward the new ski area permit fee due 
for that period under this section.
    (g) Report on Fair Market Value.--No later than five years 
after the date of enactment of this section and every 10 years 
thereafter, the Secretary shall submit to the Committee on 
Energy and Natural Resources of the United States Senate and 
the Committees of Agriculture and Resources of the United 
States House of Representatives a report analyzing whether the 
ski area permit fee system legislated by this section is 
returning a fair market value rental to the United States 
together with any recommendations the Secretary may have for 
modifications in the system.
    (h) Transition Period.--Where the new fee provided for in 
this section results in an increase in permit fee greater than 
one percent of the permittee's adjusted gross revenue (as 
defined in subsection (b)(1)), the new fee shall be phased in 
over a three year period in a manner providing for increases of 
approximately equal increments.
    (i) Applicability of NEPA to Reissuance of Ski Area 
Permits.--The reissuance of a ski area permit to provide 
activities similar in nature and amount to the activities 
provided under the previous permit is hereby determined to be a 
categorical exclusion as provided for under the National 
Environmental Policy Act of 1969 (42 U.S.C. 4331 et seq.).

SEC. 5. WITHDRAWAL OF SKI AREAS FROM OPERATION OF MINING LAWS.

    Subject to valid existing rights, all lands located within 
the boundaries of ski area permits issued prior to, on, or 
after the date of the enactment of this section pursuant to the 
authority of the Act of March 4, 1915 (16 U.S.C. 497), the Act 
of June 4, 1897 (16 U.S.C. 473 et seq.), or section 3 of this 
Act are hereby and henceforth automatically withdrawn from all 
forms of appropriation under the mining laws and from 
disposition under all laws pertaining to mineral and geothermal 
leasing. Such withdrawal shall continue for the full term of 
the permit and any modification, reissuance, or renewal of the 
permit. Such withdrawal shall be canceled automatically upon 
expiration or other termination of the permit unless, at the 
request of the Secretary of Agriculture, the Secretary of the 
Interior determines to continue the withdrawal. Upon 
cancellation of the withdrawal, the land shall be automatically 
restored to all appropriation not otherwise restricted under 
the public land laws.
                              ----------                              


                         ACT OF MARCH 24, 1976

Joint Resolution To approve the ``Covenant To Establish a Commonwealth 
  of the Northern Mariana Islands in Political Union with the United 
              States of America'', and for other purposes.

          * * * * * * *
    [Sec. 3. Pursuant to section 701 of the foregoing Covenant, 
enactment of this section shall constitute a commitment and 
pledge of the full faith and credit of the United States for 
the payment of $228 million at guaranteed annual amounts of 
direct grant assistance for the Government of the Northern 
Mariana Islands for an additional period of seven fiscal years 
after the expiration of the initial seven-year period specified 
in section 702 of said Covenant, which assistance shall be 
provided according to the schedule of payments contained in the 
Agreement of the Special Representatives on Future United 
States Financial Assistance for the Government of the Northern 
Mariana Islands, executed July 10, 1985, between the special 
representative of the President of the United States and the 
special representatives of the Governor of the Northern Mariana 
Islands. The islands of Rota and Tinian shall each receive no 
less than a \1/8\ share and the island of Saipan shall receive 
no less than a \1/4\ share of annualized capital improvement 
project funds, which shall be no less than 80 per centum of the 
capital development funds identified in the schedule of 
payments in paragraph 2 of part II of the Agreement of the 
Special Representatives. Funds shall be granted according to 
such regulations as are applicable to such grants.
    [Sec. 4. (a) Section 704(c) of the foregoing Covenant shall 
not apply to the Federal financial assistance which is provided 
to the Government of the Northern Mariana Islands pursuant to 
section 3 of this Act.
    [(b) Upon the expiration of the period of Federal financial 
assistance which is provided to the Government of the Northern 
Mariana Islands pursuant to section 3 of this Act, payments of 
direct grant assistance shall continue at the annual level 
provided for the last fiscal year of the additional period of 
seven fiscal years until Congress otherwise provides by law.]
    Sec. 5. Should the Secretary of the Interior believe that 
the performance standards of the [agreement identified in 
section 3 of this Act] Agreement of the Special Representatives 
on Future United States Financial Assistance for the Government 
of the Northern Mariana Islands, executed July 10, 1985, 
between the special representative of the President of the 
United States and the special representatives of the Governor 
of the Northern Mariana Islands are not being met, he shall 
notify the Government of the Northern Mariana Islands in 
writing with the intent to resolve such issue in a mutually 
agreeable and expeditious manner and notify the [Committee on 
Interior and Insular Affairs] Committee on Resources of the 
House of Representatives and the Committee on Energy and 
Natural Resources of the Senate. Should the issue not be 
resolved within thirty days after the notification is received 
by the Government of the Northern Mariana Islands, the 
Secretary of the Interior may request authority from Congress 
to withhold payment of an appropriate amount of the operations 
funds identified in the schedule of payments in paragraph 2 of 
part II of the Agreement of the Special Representatives for a 
period of less than one year but no funds shall be withheld 
except by Act of Congress.
                              ----------                              


              SECTION 5315 OF TITLE 5, UNITED STATES CODE

Sec. 5315. Positions at level IV

    Level IV of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Deputy Administrator of General Services.
          Associate Administrator of the National Aeronautics 
        and
        Space Administration.
          Assistant Administrators, Agency for International 
        Development (6).
          * * * * * * *
          [Assistant Secretaries of the Interior (6).]
          Assistant Secretaries of the Interior (5)
          * * * * * * *
                              ----------                              


                          ACT OF JULY 23, 1995

 AN ACT To exclude deposits of petrified wood from appropriation under 
                     the United States mining laws.

          * * * * * * *
    Sec. 3. (a) Not deposit of common varieties of sand, stone, 
gravel, pumice, pumicite, or cinders and no deposit of 
petrified wood shall be deemed a valuable mineral deposit 
within the meaning of the mining laws of the United States so 
at to give effective validity to any mining claim hereafter 
located under such mining laws: Provided, however, That nothing 
herein shall affect the validity of any mining location based 
upon discovery of some other mineral occurring in or in 
association with such a deposit. ``Common varieties'' as used 
in this Act does not include deposits of such materials which 
are valuable because the deposit has some property giving it 
distinct and special value and does not include so-called 
``block pumice'' which occurs in nature in pieces having one 
dimension to two inches or more. ``Petrified wood'' as used in 
this Act means agatized, opalized, petrified, or silicified 
wood, or any material formed by the replacement of wood by 
silica or other matter.
    (b)(1) Subject to valid existing rights, after the date of 
enactment of this subsection, notwithstanding the reference to 
common varieties in subsection (a) and to the exception to such 
term relating to a deposit of materials with some property 
giving it distinct and special value, all deposits of mineral 
materials referred to in such subsection, including the block 
pumice referred to in such subsection, shall be subject to 
disposal only under the terms and conditions of the Materials 
Act of 1947.
    (2) For purposes of paragraph (1), the term ``valid 
existing rights'' means that a mining claim located for any 
such mineral material had some property giving it the distinct 
and special value referred to in subsection (a), or as the case 
may be, met the definition of block pumice referred to in such 
subsection, was properly located and maintained under the 
general mining laws prior to the date of the enactment of this 
subsection, and was supported by a discovery of a valuable 
mineral deposit within the meaning of the general mining laws 
as in effect immediately prior to such date of enactment and 
that such claim continues to be valid under this Act.
    Sec. 4. (a) Any mining claim hereafter located under the 
mining laws of the United States shall not be used, prior to 
issuance of patent therefor, for any purposes other than 
prospecting, mining or processing operations and uses 
reasonably incident thereto.
    (b) Rights under any mining claim hereafter located under 
the mining laws of the United States shall be subject, prior to 
issuance of patent therefor, to the right of the United States 
to manage and dispose of the vegetative and mineral material 
surface resources thereof and to manage other surface resources 
thereof (except mineral deposits subject to location under the 
mining laws of the United States). Any such mining claim shall 
also be subject, prior to issuance of patent therefor, to the 
right of the United States, its permittees, and licensees, to 
sue so much of the surface thereof as may be necessary for such 
purposes or for access to adjacent land: Provided, however, 
That any use of the surface of any such mining claim by the 
United States, its permittees or licensees, shall be such as 
not to endanger or materially interfere with prospecting, 
mining or processing operations or uses reasonably incident 
thereto: Provided further, That if at any time the locator 
requires more timber for his mining operations than is 
available to him from the claim after disposition of timber 
therefrom by the United States, subsequent to the location of 
the claim, he shall be entitled, free of charge, to be supplied 
with timber for such requirements from the nearest timber 
administered by the disposing agency which is ready for 
harvesting under the rules and regulations of that agency and 
which is substantially equivalent in kind and quantity to the 
timber estimated by the disposing agency to have been disposed 
of from the claim: Provided further, That nothing in this Act 
shall be construed as affecting or intended to affect or in any 
way interfere with or modify the laws of the States which lie 
wholly or in part westward of the ninety-eighth meridian 
relating to the ownership, control, appropriation, use, and 
distribution of ground or surface waters within any unpatented 
mining claim.
    (c) Except to the extent required for the mining claimant's 
prospecting, mining or processing operations and uses 
reasonably incident thereto, or for the construction of 
buildings or structures in connection therewith, or to provide 
clearance for such operations or uses, or to the extent 
authorized by the United States, no claimant of any mining 
claim hereafter located under the mining laws of the United 
States shall, prior to issuance of patent therefor, sever, 
remove, or use any vegetative and mineral material or other 
surface resources thereof which are subject to management or 
disposition by the United States under the preceding subsection 
(b). Any severance or removal of timber which is permitted 
under the exceptions of the preceding sentence, other than 
severance or removal to provide clearance, shall be in 
accordance with sound principles of forest management.
          * * * * * * *
    Sec. 8. This Act may be cited as the ``Surface Resources 
Act of 1995''.

                          ACT OF JULY 31, 1947

AN ACT To provide for the disposal of materials on the public lands of 
                           the United States.

    Section 1. The Secretary, under such rules and regulations 
as he may prescribe, may dispose of mineral materials 
(including but not limited to [common varieties of] the 
following: sand, stone, gravel, pumice, pumicite, cinders, and 
clay) and vegetative materials (including but not limited to 
yucca, manzanita, mesquite, cactus, and timber or other forest 
products) on public lands of the United States, including, for 
the purposes of this Act, land described in the Acts of August 
28, 1937 (50 Stat. 874), and of June 24, 1954 (68 Stat. 270), 
if the disposal of such mineral or vegetative materials (1) is 
not otherwise expressly authorized by law, including, but not 
limited to, the Act of June 28, 1934 (48 Stat. 1269), as 
amended, and the United States mining laws, and (2) is not 
expressly prohibited by laws of the United States, and (3) 
would not be detrimental to the public interest. Such materials 
may be disposed of only in accordance with the provisions of 
this Act and upon the payment of adequate compensation 
therefor, to be determined by the Secretary: Provided, however, 
That, to the extent not otherwise authorized by law, the 
Secretary is authorized in his discretion to permit any 
Federal, State, or Territorial agency, unit or subdivision, 
including municipalities, or any association or corporation not 
organized for profit, to take and remove, without charge, 
materials and resources subject to this Act, for use other than 
for commercial or industrial purposes or resale. Where the 
lands have been withdrawn in aid of a function of a Federal 
department or agency other than the department headed by the 
Secretary or of a State, Territory, county, municipality, water 
district or other local governmental subdivision or agency, the 
Secretary may make disposals under this Act only with the 
consent of such other Federal department or agency or of such 
State, Territory, or local governmental unit. Nothing in this 
Act shall be construed to apply to lands in any national park, 
or national monument or to any Indian lands, or lands set aside 
or held for the use or benefit of Indians, including lands over 
which jurisdiction has been transferred to the Department of 
the Interior by Executive order for the use of Indians. As used 
in this Act, the word ``Secretary'' means the Secretary of the 
Interior except that it means the Secretary of Agriculture 
where the lands involved are administered by him for national 
forest purposes or for purposes of title III of the Bankhead-
Jones Farm Tenant Act or where withdrawn for the purpose of any 
other function of the Department of Agriculture.
    Sec. 2. (a) The Secretary shall dispose of materials under 
this Act to the highest responsible qualified bidder after 
formal advertising and such other public notice as he deems 
appropriate: Provided, however, That the Secretary may 
authorize negotiation of a contract for the disposal of 
materials if--
          (1) the contract is for the sale of less than two 
        hundred fifty thousand board-feet of timber; or, if
          (2) the contract is for the disposal of materials to 
        be used in connection with a public works improvement 
        program on behalf of a Federal, State, or local 
        governmental agency and the public exigency will not 
        permit the delay incident to advertising; or, if
          (3) the contract is for the disposal of property for 
        which it is impractical to obtain competition[.] or, if
          (4) the material is a mineral material.
    (b) Identified Deposits.--(1) Lands known to contain 
valuable deposits of mineral materials subject to this Act and 
subsequent amendments and not covered by any contract, permit, 
or lease under this section shall also be subject to 
disposition by lease under this Act by the Secretary of the 
Interior through advertisement, competitive bidding, or such 
other methods as he may by general regulations adopt, and in 
such reasonably compact areas as he shall fix.
    (2) All leases will be conditioned upon--
          (A) the payment by the lessee of such royalty as may 
        be fixed in the lease, not less than two percent of the 
        quantity or gross value of the output of mineral 
        materials, and
          (B) the payment in advance of a rental of 25 cents 
        per acre for the first calendar year or fraction 
        thereof; 50 cents per acre for the second, third, 
        fourth, and fifth years, respectively; and $1 per acre 
        per annum thereafter during the continuance of the 
        lease, such rental for that year being credited against 
        royalties accruing for that year.
    (3)(A) Any lease issued under this subsection shall be for 
a term of 20 years and so long thereafter as the lessee 
complies with the terms and conditions of the lease and upon 
the further condition that at the end of each 20-year period 
succeeding the date of the lease such reasonable adjustment of 
the terms and conditions thereof may be made therein as may be 
prescribed by the Secretary of the Interior unless otherwise 
provided by law at the expiration of such periods.
    (B) Leases shall be conditioned upon a minimum annual 
production or the payment of a minimum royalty in lieu thereof, 
except when production is interrupted by strikes, the elements, 
or casualties not attributable to the lessee.
    (C) The Secretary of the Interior may permit suspension of 
operations under any such leases when marketing conditions are 
such that the leases cannot be operated except at a loss.
    (D) The Secretary upon application by the lessee prior to 
the expiration of any existing lease in good standing shall 
amend such lease to provide for the same tenure and to contain 
the same conditions, including adjustment at the end of each 
20-year period succeeding the date of said lease, as provided 
for in this subsection.
    (c) Other Lands.--(1) The Secretary of the Interior is 
hereby authorized, under such rules and regulations as he may 
prescribe, to grant to any qualified applicant a prospecting 
permit which shall give the exclusive right to prospect for 
mineral materials in lands belonging to the United States which 
are not subject to subsection (b), and are not covered by a 
contract, permit, or lease under this Act, except that a 
prospecting permit shall not exceed a period of 2 years and the 
area to be included in such a permit shall not exceed 2,560 
acres of land in reasonably compact form.
    (2) The Secretary of the Interior shall reserve and may 
exercise the authority to cancel any prospecting permit upon 
failure by the permittee to exercise due diligence in the 
prosecution of the prospecting work in accordance with the 
terms and conditions stated in the permit, and shall insert in 
every such permit issued under the provisions of this Act 
appropriate provisions for its cancellation by him.
    (3) Upon showing to the satisfaction of the Secretary of 
the Interior that valuable deposits of one of the mineral 
materials subject to the Materials Act of 1947 have been 
discovered by the permittee within the area covered by his 
permit, and that such land is valuable therefor, the permittee 
shall be entitled to a lease for any or all of the land 
embraced in the prospecting permit, at a royalty of not less 
than two percent of the quantity or gross value of the output 
of the mineral materials at the point of shipment to market, 
such lease to be taken in compact form by legal subdivisions of 
the public land surveys, or if the land be not surveyed, by 
survey executed at the cost of the permittee in accordance with 
regulations prescribed by the Secretary of the Interior.
          * * * * * * *
    Sec. 5. This Act may be cited as the ``Materials Act of 
1947''.
                              ----------                              


                         ACT OF AUGUST 4, 1892

             (Commonly known as the ``Building Stone Act'')

 [CHAP. 375.--An act to authorize the entry of lands chiefly valuable 
            for building stone under the placer mining laws.

    [Be it enacted by the Senate and House of Representatives 
of the United States of America in Congress assembled, That any 
person authorized to enter lands under the mining laws of the 
United States may enter lands that are chiefly valuable for 
building stone under the provisions of the law in relation to 
placer mineral claims: Provided, That lands reserved for the 
benefit of the public schools or donated to any State shall not 
be subject to entry under this act.
    [Sec. 2. That an act entitled ``An act for the sale of 
timber lands in the State of California, Oregon, Nevada, and 
Washington Territory,'' approved June third, eighteen hundred 
and seventy-eight, be, and the same is hereby, amended by 
striking out the words ``States of California, Oregon, Nevada, 
and Washington Territory'' where the same occur in the second 
and third lines of said act, and insert in lieu thereof the 
words, ``public-land States,'' the purpose of this act being to 
make said act of June third, eighteen hundred and seventy-
eight, applicable to all the public-land States.
    [Sec. 3. That nothing in this act shall be construed to 
repeal section twenty-four of the act entitled ``An act to 
repeal timber-culture laws, and for other purposes,'' approved 
March third, eighteen hundred and ninety-one.]
                              ----------                              


                        ACT OF JANUARY 31, 1901

             (Commonly known as the ``Saline Placer Act'')

     [CHAP. 186.--An Act Extending the mining laws to saline lands.

    [Be it enacted by the Senate and House of Representatives 
of the United States of America in Congress assembled, That all 
unoccupied public lands of the United States containing salt 
springs, or deposits of salt in any form, and chiefly valuable 
therefor, are hereby declared to be subject to location and 
purchase under the provisions of the law relating to placer-
mining claims: Provided, That the same person shall not locate 
or enter more than one claim hereunder.]
                              ----------                              


                        ACT OF SEPTEMBER 2, 1958

 AN ACT To clarify the requirements with respect to the performance of 
   labor imposed as a condition for the holding of mining claims on 
        Federal lands pending the issuance of patents therefor.

    Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That the 
term ``labor'', as used in the third sentence of section 2324 
of the Revised Statutes (30 U.S.C. 28), shall include, without 
being limited to mineral activities, environmental baseline 
monitoring, and, geological, geochemical and geophysical 
surveys conducted by qualified experts and verified by a 
detailed report filed in the county office in which the claim 
is located which sets forth fully (a) the location of the work 
performed in relation to the point of discovery and boundaries 
of the claim, (b) the nature, extent, and cost thereof, (c) the 
basic findings therefrom, and (d) the name, address, and 
professional background of the person or persons conducting the 
work. [Such] Airborne surveys, however, may not be applied as 
labor for more than two consecutive years or for more than a 
total of five years on any one mining claim, and each such 
survey shall be nonrepetitive of any previous survey on the 
same claim.
    Sec. 2. As used in this Act,
    (a) The term ``geological surveys'' means surveys on the 
ground for mineral deposits by the proper application of the 
principles and techniques of the science of geology as they 
relate to the search for and discovery of mineral deposits;
    (b) The term ``geochemical surveys'' means surveys on the 
ground for mineral deposits by the proper application of the 
principles and techniques of the science of chemistry as they 
relate to the search for and discovery of mineral deposits;
    (c) The term ``geophysical surveys'' means surveys on the 
ground for mineral deposits through the employment of generally 
recognized equipment and methods of measuring physical 
differences between rock types or discontinuities in geological 
formations;
    (d) The term ``qualified expert'' means an individual 
qualified by education or experience to conduct environmental 
baseline monitoring or geological, geochemical or geophysical 
surveys, as the case may be.
    (e) The term ``environmental baseline monitoring'' means 
activities for collecting, reviewing and analyzing information 
concerning soil, vegetation, wildlife, mineral, air, water, 
cultural, historical, archaeological or other resources related 
to planning for or complying with Federal and State 
environmental or permitting requirements applicable to 
potential or proposed mineral activities on the claim(s).
                              ----------                              


               OMNIBUS BUDGET RECONCILIATION ACT OF 1993

          * * * * * * *

                  TITLE X--NATURAL RESOURCE PROVISIONS

          * * * * * * *

           Subtitle B--Hardrock Mining Claim Maintenance Fee

[SEC. 10101. FEE.

  [(a) Claim Maintenance Fee.--The holder of each unpatented 
mining claim, mill or tunnel site located pursuant to the 
Mining Laws of the United States, whether located before or 
after the enactment of this Act, shall pay to the Secretary of 
the Interior, on or before August 31 of each year, for years 
1994 through 1998, a claim maintenance fee of $100 per claim. 
Such claim maintenance fee shall be in lieu of the assessment 
work requirement contained in the Mining Law of 1872 (30 U.S.C. 
28-28e) and the related filing requirements contained in 
section 314 (a) and (c) of the Federal Land Policy and 
Management Act of 1976 (43 U.S.C. 1744 (a) and (c)).
  [(b) Time of Payment.--The claim maintenance fee payable 
pursuant to subsection (a) for any assessment year shall be 
paid before the commencement of the assessment year, except 
that for the initial assessment year in which the location is 
made, the locator shall pay the claim maintenance fee at the 
time the location notice is recorded with the Bureau of Land 
Management. The location fee imposed under section 10102 shall 
be payable not later than 90 days after the date of location.
  [(c) Oil Shale Claims Subject to Claim Maintenance Fees Under 
Energy Policy Act of 1992.--This section shall not apply to any 
oil shale claims for which a fee is required to be paid under 
section 2511(e)(2) of the Energy Policy Act of 1992 (Public Law 
102-486; 106 Stat. 3111; 30 U.S.C. 242).
  [(d) Waiver.--(1) The claim maintenance fee required under 
this section may be waived for a claimant who certifies in 
writing to the Secretary that on the date the payment was due, 
the claimant and all related parties--
          [(A) held not more than 10 mining claims, mill sites, 
        or tunnel sites, or any combination thereof, on public 
        lands; and
          [(B) have performed assessment work required under 
        the Mining Law of 1872 (30 U.S.C. 28-28e) to maintain 
        the mining claims held by the claimant and such related 
        parties for the assessment year ending on noon of 
        September 1 of the calendar year in which payment of 
        the claim maintenance fee was due.
  [(2) For purposes of paragraph (1), with respect to any 
claimant, the term ``related party'' means--
          [(A) the spouse and dependent children (as defined in 
        section 152 of the Internal Revenue Code of 1986), of 
        the claimant; and
          [(B) a person who controls, is controlled by, or is 
        under common control with the claimant.
For purposes of this section, the term control includes actual 
control, legal control, and the power to exercise control, 
through or by common directors, officers, stockholders, a 
voting trust, or a holding company or investment company, or 
any other means.

[SEC. 10102. LOCATION FEE.

  [Notwithstanding any other provision of law, for every 
unpatented mining claim, mill or tunnel site located after the 
date of enactment of this subtitle and before September 30, 
1998, pursuant to the Mining Laws of the United States, the 
locator shall, at the time the location notice is recorded with 
the Bureau of Land Management, pay to the Secretary of the 
Interior a location fee, in addition to the claim maintenance 
fee required by section 10101, of $25.00 per claim.]
          * * * * * * *
                              ----------                              


   SECTION 314 OF THE FEDERAL LAND POLICY AND MANAGEMENT ACT OF 1976

              recordation of mining claims and abandonment

  Sec. 314. [(a) The owner of an unpatented lode or placer 
mining claim located prior to the date of this Act shall, 
within the 3-year period following the date of the approval of 
this Act and prior to December 31 of each year thereafter, file 
the instruments required by paragraphs (1) and (2) of this 
subsection. The owner of an unpatented lode or placer mining 
claim located after the date of this Act shall, prior to 
December 31 of each year following the calendar year in which 
the said claim was located, file the instruments required by 
paragraphs (1) and (2) of this subsection:
  [(1) File for record in the office where the location notice 
or certificate is recorded either a notice of intention to hold 
the mining claim (including but not limited to such notices as 
are provided by law to be filed when there has been a 
suspension or deferment of annual assessment work), an 
affidavit of assessment work performed thereon, on a detailed 
report provided by the Act of September 2, 1958 (72 Stat. 1701; 
30 U.S.C. 28-1), relating thereto.
  [(2) File in the office of the Bureau designated by the 
Secretary a copy of the official record of the instrument filed 
or recorded pursuant to paragraph (1) of this subsection, 
including a description of the location of the mining claim 
sufficient to locate the claimed lands on the ground.]
          * * * * * * *
  [(c) The failure to file such instruments as required by 
subsections (a) and (b) shall be deemed conclusively to 
constitute an abandonment of the mining claim or mill or tunnel 
site by the owner; but it shall not be considered a failure to 
file if the instrument is defective or not timely filed for 
record under other Federal laws permitting filing or recording 
thereof, or if the instrument is filed for record by or on 
behalf of some but not all of the owners of the mining claim or 
mill or tunnel site.]
  (c) Failure to File as Constituting Forfeiture; Defective or 
Untimely Filing.--The failure to timely file the copy of the 
notice or certificate of location as required by subsection (b) 
shall constitute forfeiture of the mining claim and such claim 
shall be null and void by operation of law; except that it 
shall not be considered a failure to file if the notice or 
certificate of location is defective or not timely filed for 
record under other State or Federal laws permitting or 
requiring the filing or recording thereof, or if the copy of 
the notice or certificate is filed by or on behalf of some but 
not all of the owners of the claim.
          * * * * * * *
                              ----------                              


           FEDERAL OIL AND GAS ROYALTY MANAGEMENT ACT OF 1982

 AN ACT To ensure that all oil and gas originated on the public lands 
and on the Outer Continental Shelf are properly accounted for under the 
  direction of the Secretary of the Interior, and for other purposes.

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

                   short title and table of contents

  Section 1. This Act may be cited as the ``Federal Oil and Gas 
Royalty Management Act of 1982''.

                            TABLE OF CONTENTS

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

           TITLE I--FEDERAL ROYALTY MANAGEMENT AND ENFORCEMENT

Sec. 101. Duties of the Secretary.
Sec. 102. Duties of lessees, operators, and motor vehicle transporters.
Sec. 103. Required recordkeeping.
     * * * * * * *
Sec. 111. Royalty interest, penalties and payments.
Sec. 111A. Adjustments and refunds.
Sec. 112. Injunction and specific enforcement authority.
Sec. 113. Rewards.
Sec. 114. Noncompetitive oil and gas lease royalty rates.
Sec. 115. Limitation periods and agency actions.
Sec. 116. Alternatives for marginal properties.
     * * * * * * *

                      TITLE III--GENERAL PROVISIONS

Sec. 301. Secretarial authority.
Sec. 302. Reports.
Sec. 303. Study of other minerals.
     * * * * * * *
[Sec. 307. Statute of limitations.]
          * * * * * * *

                              definitions

  Sec. 3. For the purposes of this Act, the term--
          (1)  * * *
          * * * * * * *
          [(7) ``lessee'' means any person to whom the United 
        States, an Indian tribe, or an Indian allottee, issues 
        a lease, or any person who has been assigned an 
        obligation to make royalty or other payments required 
        by the lease;]
          (7) ``lessee'' means any person to whom the United 
        States, an Indian tribe, or an Indian allottee issues a 
        lease or any person to whom operating rights have been 
        assigned;
          * * * * * * *
          (15) ``Secretary'' means the Secretary of the 
        Interior or his designee; [and]
          (16) ``State'' means the several States of the Union, 
        the District of Columbia, Puerto Rico, the territories 
        and possessions of the United States, and the Trust 
        Territory of the Pacific Islands[.];
          (17) ``adjustment'' means an amendment to a 
        previously filed report on an obligation, and any 
        additional payment or credit, if any, applicable 
        thereto, to rectify an underpayment or overpayment on a 
        lease;
          (18) ``administrative proceeding'' means any agency 
        process in which a demand, decision or order issued by 
        the Secretary is subject to appeal or has been 
        appealed;
          (19) ``assessment'' means any fee or charge levied or 
        imposed by the Secretary or the United States other 
        than--
                  (A) the principal amount of any royalty, 
                minimum royalty, rental, bonus, net profit 
                share or proceed of sale;
                  (B) any interest; or
                  (C) any civil or criminal penalty;
          (20) ``commence'' means--
                  (A) with respect to a judicial proceeding, 
                the service of a complaint, petition, 
                counterclaim, crossclaim, or other pleading 
                seeking affirmative relief or seeking credit or 
                recoupment; or
                  (B) with respect to a demand, the receipt by 
                the Secretary or a lessee of the demand;
          (21) ``credit'' means the application of an 
        overpayment (in whole or in part) against an obligation 
        which has become due to discharge, cancel or reduce the 
        obligation;
          (22) ``demand'' means--
                  (A) an order to pay issued by the Secretary; 
                or
                  (B) a separate written request by a lessee 
                which asserts an obligation due the lessee,
        but does not mean any royalty or production report, or 
        any information contained therein, required by the 
        Secretary;
          (23) ``obligation'' means--
                  (A) any duty of the Secretary or the United 
                States--
                          (i) to take oil or gas royalty in 
                        kind; or
                          (ii) to pay, refund, offset, or 
                        credit monies including but not limited 
                        to--
                                  (I) the principal amount of 
                                any royalty, minimum royalty, 
                                rental, bonus, net profit share 
                                or proceed of sale; or
                                  (II) any interest;
                  (B) any duty of a lessee--
                          (i) to deliver oil or gas royalty in 
                        kind; or
                          (ii) to pay, offset or credit monies 
                        including but not limited to--
                                  (I) the principal amount of 
                                any royalty, minimum royalty, 
                                rental, bonus, net profit share 
                                or proceed of sale;
                                  (II) any interest;
                                  (III) any penalty; or
                                  (IV) any assessment,
        which arises from or relates to any lease administered 
        by the Secretary for, or any mineral leasing law 
        related to, the exploration, production and development 
        of oil or gas on Federal lands or the Outer Continental 
        Shelf;
          (24) ``order to pay'' means a written order issued by 
        the Secretary or the United States which--
                  (A) asserts a definite and quantified 
                obligation; and
                  (B) specifically identifies the obligation by 
                lease, production month and amount of such 
                obligation ordered to be paid, as well as the 
                reason or reasons such obligation is claimed to 
                be due,
        but such term does not include any other communication 
        or action by or on behalf of the Secretary or the 
        United States;
          (25) ``overpayment'' means any payment by a lessee in 
        excess of an amount legally required to be paid on an 
        obligation and includes the portion of any estimated 
        payment for a production month that is in excess of the 
        royalties due for that month;
          (26) ``payment'' means satisfaction, in whole or in 
        part, of an obligation;
          (27) ``penalty'' means a statutorily authorized civil 
        fine levied or imposed by the Secretary or the United 
        States for a violation of this Act, any mineral leasing 
        law, or a term or provision of a lease administered by 
        the Secretary;
          (28) ``refund'' means the return of an overpayment by 
        the Secretary or the United States by the drawing of 
        funds from the United States Treasury;
          (29) ``State concerned'' means, with respect to a 
        lease, a State which receives a portion of royalties 
        under this Act from such lease; and
          (30) ``underpayment'' means any payment or nonpayment 
        by a lessee that is less than the amount legally 
        required to be paid on an obligation. deg.


          TITLE I--FEDERAL ROYALTY MANAGEMENT AND ENFORCEMENT

                        duties of the secretary

  Sec. 101. (a)  * * *
          * * * * * * *
  (d)(1) For the purpose of reducing costs and increasing net 
royalties to the United States and the States, the Secretary, 
in consultation with States concerned, shall, within one year 
after the date of the enactment of this subsection, streamline 
and simplify current royalty management requirements and 
practices, including royalty reporting, instructions, audits 
and collections. This streamlining and simplification shall 
specifically include--
          (A) elimination of all unnecessary royalty and 
        production reports;
          (B) modification and simplification of remaining 
        reports and associated instructions to eliminate 
        redundant or unnecessary reports and information that 
        are provided or can be obtained from other required 
        reports, forms, computer databases or government 
        agencies;
          (C) elimination or modifications of accounting, 
        reporting, audit and collection requirements that are 
        not cost-effective, particularly those associated with 
        de minimis monetary amounts;
          (D) implementation of specific recommendations and 
        comments contained in Secretarial sponsored teams, 
        rulemakings, and studies or those participated in by 
        the Secretary to the extent these recommendations 
        simplify and streamline royalty management requirements 
        without adversely affecting the Secretary's ability to 
        meet obligations under this Act or other mineral 
        leasing statutes;
          (E) recommendations and comments submitted by 
        interested parties to the extent these recommendations 
        and comments simplify and streamline royalty management 
        requirements without adversely affecting the 
        Secretary's ability to meet obligations under this Act 
        or other mineral leasing statutes.
  (2) The Secretary shall submit to the Congress a progress 
report on the implementation of this section within six months 
from date of enactment of this Act, and a final report within 
12 months from date of enactment of this Act. These reports 
shall include--
          (A) a description of the extent to which the 
        Secretary has implemented the requirements in paragraph 
        (1), including a list of specific initiatives 
        implemented;
          (B) a list and description of additional initiatives 
        identified by the Secretary to simplify and streamline 
        royalty management requirements and practices; and
          (C) cost savings of implemented initiatives including 
        impact on net-receipts sharing for States.
  (3) If the Secretary and the State concerned determines that 
the cost of accounting and auditing for and collecting of any 
obligation due for any oil and gas production exceeds the 
amount of the obligation to be collected, the Secretary shall 
waive such obligation.
  (4) The Secretary and the State concerned shall not perform 
accounting, reporting, or audit activities if the Secretary and 
the State concerned determines that the cost of conducting the 
activity exceeds the expected amount to be collected by the 
activity.
  (5) The Secretary and the State concerned shall develop a 
reporting and audit strategy which eliminates multiple or 
redundant reporting of information.

      duties of lessees, operators, and motor vehicle transporters

  Sec. 102. [(a) A lessee--
          [(1) who is required to make any royalty or other 
        payment under a lease or under the mineral leasing 
        laws, shall make such payments in the time and manner 
        as may be specified by the Secretary; and
          [(2) shall notify the Secretary, in the time and 
        manner as may be specified by the Secretary, of any 
        assignment the lessee may have made of the obligation 
        to make any royalty or other payment under a lease or 
        under the mineral leasing laws.]
  (a) A lessee who is required to make any royalty or other 
payment under a lease or under the mineral leasing laws, shall 
make such payments in the time and manner as may be specified 
by the Secretary. A lessee may designate a person to act on the 
lessee's behalf and shall notify the Secretary in writing of 
such designation. The person to whom the United States issues a 
lease or the person by whom operating rights are currently 
owned, but not both, shall remain primarily liable for its 
obligations.
          * * * * * * *

                         required recordkeeping

  Sec. 103. (a)  * * *
          * * * * * * *
  (c) Records required by the Secretary for the purpose of 
determining compliance with any applicable mineral leasing law, 
lease provision, regulation or order with respect to oil and 
gas leases from Federal lands or the Outer Continental Shelf 
shall be maintained for the same period of time during which a 
judicial proceeding or demand may be commenced under section 
115(a). If a judicial proceeding or demand is timely commenced, 
the record holder shall maintain such records until the final 
nonappealable decision in such judicial proceeding is made, or 
with respect to that demand is rendered, unless the Secretary 
authorizes in writing an earlier release of the requirement to 
maintain such records. Notwithstanding anything herein to the 
contrary, under no circumstance shall a record holder be 
required to maintain or produce any record relating to an 
obligation for any time period which is barred by the 
applicable limitation in section 115.
          * * * * * * *

                      hearings and investigations

  Sec. 107. (a)  * * *
          * * * * * * *
  (c) Rules Regarding Issuance of Subpoena Relating to 
Reporting and Payment of an Obligation Due.--
          (1) In general.--A subpoena which requires a lessee 
        to produce records necessary to determine the proper 
        reporting and payment of an obligation due the 
        Secretary may be issued under this section only by an 
        Assistant Secretary of the Interior and an acting 
        Assistant Secretary of the Interior who is a schedule C 
        employee (as defined by section 213.3301 of title 5, 
        Code of Federal Regulations) and may not be delegated.
          (2) Prior written request required.--A subpoena 
        described in paragraph (1) may only be issued against a 
        lessee during the limitation period provided in section 
        115 and only after the Secretary has in writing 
        requested the records from the lessee related to the 
        obligation which is the subject of the subpoena and has 
        determined that--
                  (A) the lessee has failed to respond within a 
                reasonable period of time to the Secretary's 
                written request for such records necessary for 
                an audit, investigation or other inquiry made 
                in accordance with the Secretary's 
                responsibilities under this Act;
                  (B) the lessee has in writing denied the 
                Secretary's written request to produce such 
                records in the lessee's possession or control 
                necessary for an audit, investigation or other 
                inquiry made in accordance with the Secretary's 
                responsibilities under this Act; or
                  (C) the lessee has unreasonably delayed in 
                producing records necessary for an audit, 
                investigation or other inquiry made in 
                accordance with the Secretary's 
                responsibilities under this Act after the 
                Secretary's written request.
          (3) Reasonable period for compliance with written 
        request.--In seeking records, the Secretary shall 
        afford the lessee a reasonable period of time after a 
        written request by the Secretary in which to provide 
        such records prior to the issuance of any subpoena.
  (d) Restructured Accounting.--
          (1) In general.--The Secretary shall issue an order 
        to perform a restructured accounting when the Secretary 
        determines during an in-depth audit of a lessee that 
        the lessee should recalculate royalty due on an 
        obligation based upon the Secretary's finding that the 
        lessee has made identified underpayments or 
        overpayments which are demonstrated by the Secretary to 
        be based upon repeated, systemic reporting errors for a 
        significant number of leases or a single lease for a 
        significant number of reporting months with the same 
        type of error which constitutes a pattern of violations 
        and which are likely to result in either significant 
        underpayments or overpayments.
          (2) Delegation.--The power of the Secretary to issue 
        an order to perform a restructured accounting may not 
        be delegated below the most senior career professional 
        position having responsibility for the royalty 
        management program, which position is currently 
        designated as the ``Associate Director for Royalty 
        Management''. An order to perform a restructured 
        accounting shall--
                  (A) be issued within a reasonable period of 
                time from when the audit identifies the 
                systemic, reporting errors;
                  (B) specify the reasons and factual bases for 
                such order; and
                  (C) be specifically identified as an ``order 
                to perform a restructured accounting''.
          (3) Order to perform.--An order to perform a 
        restructured accounting shall not include any other 
        communication or action by or on behalf of the 
        Secretary or the United States.
          (4) Notice.--If a lessee fails to adequately perform 
        a restructured accounting pursuant to this subsection, 
        a notice shall be issued to the lessee that the 
        restructured accounting has not been adequately 
        performed. Such notice may be issued under this section 
        only by an Assistant Secretary of the Interior or an 
        acting Assistant Secretary of the Interior who is a 
        schedule C employee (as defined by section 213.3301 of 
        title 5, Code of Federal Regulations) and may not be 
        delegated.
  (e) Paperwork Reduction.--Administrative actions and 
investigations (including, but not limited to, accounting 
collection and audits) under this Act involving obligations 
shall be subject to section 3518(c)(1)(B) of title 44, United 
States Code.
          * * * * * * *

                            civil penalties

  Sec. 109. (a)  * * *
          * * * * * * *
  (c) Any person who--
          (1) [knowingly or willfully] by willful misconduct or 
        gross negligence fails to make any royalty payment by 
        the date as specified by statute, regulation, order or 
        terms of the lease;
          (2) fails or refuses to permit lawful entry, 
        inspection, or audit; or
          (3) [knowingly or willfully] by willful misconduct or 
        gross negligence fails or refuses to comply with 
        subsection 102(b)(3),
shall be liable for a penalty of up to $10,000 per violation 
for each day such violation continues.
  (d) Any person who--
          (1) [knowingly or willfully] by willful misconduct or 
        gross negligence prepares, maintains, or submits false, 
        inaccurate, or misleading reports, notices, affidavits, 
        records, data, or other written information;
          (2) [knowingly or willfully] by willful misconduct or 
        gross negligence takes or removes, transports, uses or 
        diverts any oil or gas from any lease site without 
        having valid legal authority to do so; or
          * * * * * * *

                royalty interest, penalties and payments

  Sec. 111. (a)  * * *
          * * * * * * *
  [(f) Interest shall be charged under this section only for 
the number of days a payment is late.]
  (f) Upon a determination that it will further the effective 
and efficient performance of his duties and responsibilities, 
the Secretary may waive or forego such interest in whole or in 
part. Interest shall be charged under this section only for the 
number of days a payment is late.
          * * * * * * *
  (h) Interest shall be allowed and the Secretary shall pay or 
credit such interest on any overpayment, with such interest to 
accrue from the date such overpayment was made, at the rate 
obtained by applying the provisions of subparagraphs (A) and 
(B) of section 6621(a)(1) of the Internal Revenue Code of 1986. 
Interest which has accrued on any overpayment may be applied to 
reduce an underpayment. This subsection applies to overpayments 
made later than six months after the date of enactment of this 
subsection or September 1, 1996, whichever is later. Such 
interest shall be paid from amounts received as current 
receipts from sales, bonuses, royalties (including interest 
charges collected under this section) and rentals of the public 
lands and the Outer Continental Shelf under the provisions of 
the Mineral Leasing Act, and the Outer Continental Shelf Lands 
Act, which are not payable to a State or the Reclamation Fund. 
The portion of any such interest payment attributable to any 
amounts previously disbursed to a State, the Reclamation Fund, 
or any other recipient designated by law shall be deducted from 
the next disbursements to that recipient made under the 
applicable law. Such amounts deducted from subsequent 
disbursements shall be credited to miscellaneous receipts in 
the Treasury.
  (i) Upon a determination by the Secretary that an excessive 
overpayment (based upon all obligations of a lessee for a given 
reporting month) was made for the sole purpose of receiving 
interest, interest shall not be paid on the excessive amount of 
such overpayment. For purposes of this Act, an ``excessive 
overpayment'' shall be the amount that any overpayment a lessee 
pays for a given reporting month (excluding payments for 
demands for obligations as a result of judicial or 
administrative proceedings for settlement agreements and for 
other similar payments) for the aggregate of all of its Federal 
leases exceeds 25 percent of the total royalties paid that 
month for those leases.
  (j) A lessee may make a payment for the approximate amount of 
royalties (hereinafter in this subsection ``estimated 
payment'') that would otherwise be due to the Secretary for 
such lease to avoid underpayment or nonpayment interest 
charges. When an estimated payment is made, actual royalties 
become due at the end of the month following the period covered 
by the estimated payment. If the lessee makes a payment for 
such actual royalties, the lessee may apply the estimated 
payment to future royalties. Any estimated payment may be 
adjusted, recouped, or reinstated at any time by the lessee.
  (k)(1) Except as otherwise provided by this subsection--
          (A) a lessee of a lease in a unit or communitization 
        agreement which contains only Federal leases with the 
        same royalty rate and funds distribution must report 
        and pay royalties on oil and gas production for each 
        production month based on the actual volume of 
        production sold by or on behalf of that lessee;
          (B) a lessee of a lease in any other unit or 
        communitization agreement must report and pay royalties 
        on oil and gas production for each production month 
        based on the volume of oil and gas produced from such 
        agreement and allocated to the lease in accordance with 
        the terms of the agreement; and
          (C) a lessee of a lease that is not contained in a 
        unit or communitization agreement must report and pay 
        royalties on oil and gas production for each production 
        month based on the actual volume of production sold by 
        or on behalf of that lessee.
  (2) This subsection applies only to requirements for 
reporting and paying royalties. Nothing in this subsection is 
intended to alter a lessee's liability for royalties on oil or 
gas production based on the share of production allocated to 
the lease in accordance with the terms of the lease, a unit or 
communitization agreement, or any other agreement.
  (3) For any unit or communitization agreement, if all lessees 
contractually agree to an alternative method of royalty 
reporting and payment, the lessees may submit such alternative 
method to the Secretary for approval and make payments in 
accordance with such approved alternative method so long as 
such alternative method does not reduce the amount of the 
royalty obligation.
  (4) The Secretary shall grant an exception from the reporting 
and payment requirements for marginal properties by allowing 
for any calendar year or portion thereof royalties to be paid 
each month based on the volume of production sold. Interest 
shall not accrue on the difference for the entire calendar year 
or portion thereof between the amount of oil and gas actually 
sold and the share of production allocated to the lease until 
the beginning of the month following calendar year or portion 
thereof. Any additional royalties due or overpaid royalties and 
associated interest shall be paid, refunded, or credited within 
six months after the end of each calendar year in which 
royalties are paid based on volumes of production sold. For the 
purpose of this subsection, the term ``marginal property'' 
means a lease that produces on average the combined equivalent 
of less than 15 barrels of oil per day or 90 thousand cubic 
feet of gas per day, or a combination thereof, determined by 
dividing the average daily production of domestic crude oil and 
domestic natural gas from producing wells on such lease by the 
number of such wells, unless the Secretary, together with the 
State concerned, determines that a different production is more 
appropriate.
  (5) Not later than two years after the date of the enactment 
of this subsection, the Secretary shall issue any appropriate 
demand for all outstanding royalty payment disputes regarding 
who is required to report and pay royalties on production from 
units and communitization agreements outstanding on the date of 
the enactment of this subsection, and collect royalty amounts 
owed on such production.
  (l) The Secretary shall issue all determinations of 
allocations of production for units and communitization 
agreements within 120 days of a request for determination. If 
the Secretary fails to issue a determination within such 120-
day period, the Secretary shall waive interest due on 
obligations subject to the determination until the end of the 
month following the month in which the determination is made.
  (m)(1) After the date of enactment of this subsection, the 
Secretary shall not impose any assessment for any late payment 
or underpayment. After the date of enactment of this 
subsection, the Secretary may impose an assessment only for 
erroneous reports submitted by lessees subject to the 
limitations of paragraph (2). Nothing in this section shall 
prohibit the Secretary from imposing penalties or interest 
under other sections of this Act for late payments or 
underpayments.
  (2) No assessment for erroneous reports shall be imposed for 
18 months following the date of enactment of this subsection, 
or until the Secretary issues a final rule which provides for 
imposition of an assessment only on a lessee who chronically 
submits erroneous reports and which establishes what 
constitutes chronic errors for a lessee, whichever is later. 
However, if the Secretary determines during that 18-month 
period that the reporting error rate for all reporters for all 
Federal leases has increased by one-third for three consecutive 
report months for either production reporting or royalty 
reporting over the 12 months preceding the date of enactment of 
this subsection, the Secretary may impose an assessment for 
erroneous reports only for the increased category of report 
under regulations in effect on the date of enactment of this 
subsection.

SEC. 111A. ADJUSTMENTS AND REFUNDS.

  (a) Adjustments.--
          (1) If, during the adjustment period, a lessee 
        determines that an adjustment or refund request is 
        necessary to correct an underpayment or overpayment of 
        an obligation, the lessee shall make such adjustment or 
        request a refund within a reasonable period of time and 
        only during the adjustment period. The filing of a 
        royalty report which reflects the underpayment or 
        overpayment of an obligation shall constitute prior 
        written notice to the Secretary of an adjustment.
          (2)(A) For any adjustment, the lessee shall calculate 
        and report the interest due attributable to such 
        adjustment at the same time the lessee adjusts the 
        principal amount of the subject obligation, except as 
        provided by subparagraph (B).
          (B) In the case of a lessee on whom the Secretary 
        determines that subparagraph (A) would impose a 
        hardship, the Secretary shall calculate the interest 
        due and notify the lessee within a reasonable time of 
        the amount of interest due, unless such lessee elects 
        to calculate and report interest in accordance with 
        subparagraph (A).
          (3) An adjustment or a request for a refund for an 
        obligation may be made after the adjustment period only 
        upon written notice to and approval by the Secretary 
        during an audit of the period which includes the 
        production month for which the adjustment is being 
        made. If an overpayment is identified during an audit, 
        then the Secretary shall allow a credit or refund in 
        the amount of the overpayment.
          (4) For purposes of this section, the adjustment 
        period for any obligation shall be the five-year period 
        following the date on which an obligation became due. 
        The adjustment period shall be suspended, tolled, 
        extended, enlarged, or terminated by the same actions 
        as the limitation period in section 115.
  (b) Refunds.--
          (1) In general.--A request for refund is sufficient 
        if it--
                  (A) is made in writing to the Secretary and, 
                for purposes of section 115, is specifically 
                identified as a demand;
                  (B) identifies the person entitled to such 
                refund;
                  (C) provides the Secretary information that 
                reasonably enables the Secretary to identify 
                the overpayment for which such refund is 
                sought; and
                  (D) provides the reasons why the payment was 
                an overpayment.
          (2) Payment by secretary of the treasury.--The 
        Secretary shall certify the amount of the refund to be 
        paid under paragraph (1) to the Secretary of the 
        Treasury who shall make such refund. Such refund shall 
        be paid from amounts received as current receipts from 
        sales, bonuses, royalties (including interest charges 
        collected under this section) and rentals of the public 
        lands and the Outer Continental Shelf under the 
        provisions of the Mineral Leasing Act and the Outer 
        Continental Shelf Lands Act, which are not payable to a 
        State or the Reclamation Fund. The portion of any such 
        refund attributable to any amounts previously disbursed 
        to a State, the Reclamation Fund, or any recipient 
        prescribed by law shall be deducted from the next 
        disbursements to that recipient made under the 
        applicable law. Such amounts deducted from subsequent 
        disbursements shall be credited to miscellaneous 
        receipts in the Treasury.
          (3) Payment period.--A refund under this subsection 
        shall be paid or denied (with an explanation of the 
        reasons for the denial) within 120 days of the date on 
        which the request for refund is received by the 
        Secretary. Such refund shall be subject to later audit 
        by the Secretary and subject to the provisions of this 
        Act.
          (4) Prohibition against reduction of refunds or 
        credits.--In no event shall the Secretary directly or 
        indirectly claim any amount or amounts against, or 
        reduce any refund or credit (or interest accrued 
        thereon) by the amount of any obligation the 
        enforcement of which is barred by section 115.
          * * * * * * *

SEC. 115. LIMITATION PERIODS AND AGENCY ACTIONS.

  (a) In General.--A judicial proceeding or demand which arises 
from, or relates to an obligation, shall be commenced within 
six years from the date on which the obligation becomes due and 
if not so commenced shall be barred, except as otherwise 
provided by this section.
  (b) Obligation Becomes Due.--
          (1) In general.--For purposes of this Act, an 
        obligation becomes due when the right to enforce the 
        obligation is fixed.
          (2) Royalty obligations.--The right to enforce the 
        royalty obligation for a production month for a lease 
        is fixed for purposes of this Act on the last day of 
        the calendar month following the month in which oil or 
        gas is produced.
          (3) Royalty payment.--The right to collect a royalty 
        payment for an obligation for a production month for a 
        lease is fixed for purposes of this Act on the last day 
        of the second calendar month following the month in 
        which gas is produced, to be phased in by the Secretary 
        in a manner which does not have a negative impact on 
        the Federal budget.
  (c) Tolling of Limitation Period.--The running of the 
limitation period under subsection (a) shall not be suspended, 
tolled, extended, or enlarged for any obligation for any reason 
by any action, including an action by the Secretary or the 
United States, other than the following:
          (1) Tolling agreement.--A written agreement executed 
        during the limitation period between the Secretary and 
        a lessee which tolls the limitation period for the 
        amount of time during which the agreement is in effect.
          (2) Subpoena.--The issuance of a subpoena in 
        accordance with the provisions of section 107(c) shall 
        toll the limitation period with respect to the 
        obligation which is the subject of a subpoena only for 
        the period beginning on the date the lessee receives 
        the subpoena and ending on the date on which (A) the 
        lessee has produced such subpoenaed records for the 
        subject obligation, (B) the Secretary receives written 
        notice that the subpoenaed records for the subject 
        obligation are not in existence or are not in the 
        lessee's possession or control, or (C) a court has 
        determined in a final decision that such records are 
        not required to be produced, whichever occurs first.
          (3) Fraud or concealment.--Any fraud or concealment 
        by a lessee in an attempt to defeat or evade an 
        obligation in which case the limitation period shall be 
        tolled for the period of such fraud or such 
        concealment.
          (4) Tolling request.--A written tolling request from 
        a lessee based upon the lessee's representation that 
        the lessee's entitlement to an overpayment has not been 
        finally determined. The limitation period shall be 
        tolled pursuant to this paragraph from the date the 
        Secretary receives the tolling request until the 
        earlier of the end of the requested period or 12 months 
        after the date the Secretary receives the tolling 
        request, but is subject to successive 12-month renewals 
        by the lessee made prior to the expiration of the then 
        applicable 12-month period. The tolling request shall 
        be sufficient if it identifies--
                  (A) the person who made the potential 
                overpayment;
                  (B) the leases and production months involved 
                in the potential overpayment; and
                  (C) the reasons the lessee believes that it 
                may later be entitled to a refund of the 
                overpayment.
          (5) Order to perform a restructured accounting.--The 
        issuance of a notice under section 107(d)(4) that the 
        lessee has not adequately performed a restructured 
        accounting shall toll the limitation period with 
        respect to the obligation which is the subject of the 
        notice only for the period beginning on the date the 
        lessee receives the notice and ending on the date on 
        which (A) the Secretary receives written notice the 
        accounting or otherrequirement has been performed, or 
        (B) a court has determined in a final decision that the 
        lessee is not required to perform the accounting, 
        whichever occurs first.
  (d) Termination of Limitations Period.--The limitations 
period shall be terminated in the event--
          (1) the Secretary has notified the lessee in writing 
        that a time period is closed to further audit; or
          (2) the Secretary and a lessee have so agreed in 
        writing.
  (e) Final Agency Action.--
          (1) 3-year period.--The Secretary shall issue a final 
        decision in any administrative proceeding, including 
        any administrative proceedings pending on the date of 
        enactment of the Federal Oil and Gas Royalty 
        Simplification and Fairness Act of 1995, within three 
        years from the date such proceeding was initiated or 
        three years from the date of such enactment, whichever 
        is later. The 3-year period may be extended by any 
        period of time agreed upon in writing by the Secretary 
        and the lessee.
          (2) Effect of failure to issue decision.--
                  (A) In general.--If no such decision has been 
                issued by the Secretary within the three-year 
                period referred to in paragraph (1)--
                          (i) the Secretary shall be deemed to 
                        have issued and granted a decision in 
                        favor of the lessee or lessees as to 
                        any nonmonetary obligation and any 
                        monetary obligation the principal 
                        amount of which is less than $2,500; 
                        and
                          (ii) the Secretary shall be deemed to 
                        have issued a final decision in favor 
                        of the Secretary, which decision shall 
                        be deemed to affirm those issues for 
                        which the agency rendered a decision 
                        prior to the end of such period, as to 
                        any monetary obligation the principal 
                        amount of which is $2,500 or more, and 
                        the lessee shall have a right to a de 
                        novo judicial review of such deemed 
                        final decision.
          (B) No precedential effect on other proceedings.--
        Deemed decisions under subparagraph (A) shall have no 
        precedential effect in any judicial or administrative 
        proceeding or for any other purpose.
    (f) Administrative Settlement.--During the pendency of any 
administrative proceeding, the parties shall hold at least one 
settlement consultation for the purpose of discussing disputed 
matters between the parties. For purposes of settlement, the 
Secretary may take such action as is appropriate to compromise 
and settle a disputed obligation, including interest and 
allowing offsetting of obligations among leases. The Secretary 
and the State concerned shall seek to resolve disputes with a 
lessee in as expeditious a manner as possible, through 
settlement negotiations and other alternative dispute 
resolution processes methods. If any dispute involving an 
obligation due is not resolved by the end of the 6-year period 
beginning on the date the obligation became due, the amount of 
interest otherwise payable with respect to the obligation shall 
accrue after such 6-year period at the rate--
          (1) for purposes of section 111(h), reduced each year 
        thereafter by two additional percentage points from the 
        rate in effect under this subsection for the previous 
        year (but not less than zero); and
          (2) for purposes of section 111(a), reduced each year 
        thereafter by one additional percentage point from the 
        rate in effect under this subsection for the previous 
        year (but not less than zero).
    (g) Limitation on Certain Actions.--When an action on or 
enforcement of an obligation under the mineral leasing laws is 
barred under this section--
          (1) no other or further action regarding that 
        obligation, including (but not limited to) the issuance 
        of any order, request, demand or other communication 
        seeking any document, accounting, determination, 
        calculation, recalculation, payment, principal, 
        interest, assessment, or penalty or the initiation, 
        pursuit or completion of an audit with respect to that 
        obligation may be taken; and
          (2) no other equitable or legal remedy, whether under 
        statute or common law, with respect to an action on or 
        an enforcement of said obligation may be pursued.
    (h) Judicial Review.--In the event a demand subject to this 
section is timely commenced, a judicial proceeding challenging 
the final agency action with respect to such demand shall be 
deemed timely so long as such judicial proceeding is commenced 
within 180 days from receipt of notice by the lessee of the 
final agency action.
    (i) Implementation of Final Decision.--In the event a 
judicial proceeding or demand subject to this section is timely 
commenced and thereafter the limitation period in this section 
lapses during the pendency of such proceeding, any party to 
such proceeding shall not be barred from taking such action as 
is required or necessary to implement a final unappealable 
judicial or administrative decision, including any action 
required or necessary to implement such decision by the 
recovery or recoupment of an underpayment or overpayment by 
means of refund or credit.
    (j) Stay of Payment Obligation Pending Review.--Any party 
ordered by the Secretary or the United States to pay any 
obligation (other than an assessment) shall be entitled to a 
stay of such payment without bond or other surety instrument 
pending an administrative or judicial proceeding if the party 
periodically demonstrates to the satisfaction of the Secretary 
that such party is financially solvent or otherwise able to pay 
the obligation. In the event the party is not able to so 
demonstrate, the Secretary may require a bond or other surety 
instrument satisfactory to cover the obligation. Any party 
ordered by the Secretary to pay an assessment shall be entitled 
to a stay without bond or other surety instrument.
    (k) Inapplicability of the Other Statutes of Limitation.--
The limitations set forth in sections 2401, 2415, 2416, and 
2462 of title 28, United States Code, section 42 of the Mineral 
Leasing Act (30 U.S.C. 226-2) and section 3716 of title 31, 
United States Code, shall not apply to any obligation to which 
this Act applies.

SEC. 116. ALTERNATIVES FOR MARGINAL PROPERTIES.

    (a) Selling the Revenue Stream.--
          (1) In general.--Notwithstanding the provisions of 
        any lease to the contrary, upon request of the lessee 
        or a State under section 205(g), the Secretary shall 
        authorize a lessee for a marginal property and for a 
        lease, the administration of which is not cost-
        effective for the Secretary to administer, to make a 
        prepayment in lieu of royalty payments under the lease 
        for the remainder of the lease term. For the purposes 
        of this section, the term ``marginal property'' has the 
        same meaning given such term in section 111(k)(4), 
        unless the Secretary, together with each State in which 
        such marginal production occurs, determines that a 
        different definition of marginal property better 
        achieves the purpose of this section.
          (2) Marginal properties.--For marginal properties, 
        prepayments under paragraph (1) shall begin--
                  (A) in the case of those properties producing 
                on average $500 or less per month in total 
                royalties to the United States, 2 years after 
                the date of the enactment of this section;
                  (B) in the case of those properties producing 
                on average more than $500 but $1,000 or less 
                per month in total royalties to the United 
                States, three years after the date of the 
                enactment of this section;
                  (C) in the case of those properties producing 
                on average more than $1,000 but $1,500 or less 
                per month in total royalties to the United 
                States, four years after the date of the 
                enactment of this section; and
                  (D) in the case of those properties not 
                described in subparagraphs (A) through (C), 
                five years after the date of the enactment of 
                this section.
          (3) Administration not cost-effective.--For a lease, 
        the administration of which is not cost-effective for 
        the Secretary to administer, prepayments under 
        paragraph (1) shall begin on the date of the enactment 
        of this section.
          (4) Satisfaction of royalty obligation.--A lessee who 
        makes a prepayment under this section shall have 
        satisfied in full its obligation to pay royalty on 
        production from the lease or a portion of a lease and 
        shall not be required to submit any royalty reports to 
        the Secretary. The prepayment shall be shared by the 
        Secretary with any State or other recipient to the same 
        extent as any royalty payment for such lease.
          (5) Valuation.--The prepayment authorized under this 
        section shall only occur if the Secretary, the State 
        concerned, and the lessee determine that such 
        prepayment is based on the present value of the 
        projected remaining royalties from the production from 
        the lease, based on appropriate nominal discount rate 
        for a comparable term. Prior to accepting such 
        prepayment, the Secretary and State concerned shall 
        agree that such prepayment is in the best interest of 
        the United States and the State concerned.
    (b) Alternative Accounting and Auditing Requirements.--
          (1) In general.--Within one year after the date of 
        the enactment of this section, for the marginal 
        properties referenced in subsection (a)(1), the 
        Secretary shall provide accounting, reporting, and 
        auditing relief that will encourage lessees to continue 
        to produce and develop such properties: Provided, That 
        such relief will only be available to lessees in a 
        State that concurs. Prior to granting such relief, the 
        Secretary and the State concerned shall agree that the 
        type of marginal wells and relief provided under this 
        paragraph is in the best interest of the United States 
        and the State concerned.
          (2) Payment date.--For leases subject to this 
        section, the Secretary may allow royalties to be paid 
        later than the time specified in the 
        lease. deg.


                   TITLE II--STATES AND INDIAN TRIBES

          * * * * * * *

                     state suits under federal law

    Sec. 204. (a) * * *
          * * * * * * *
    (d) With respect to an obligation, a State bringing an 
action under this section shall enjoy no greater rights than 
the Secretary enjoys under this Act.

                          delegation to states

    Sec. 205. [(a) Upon written request of any State, the 
Secretary is authorized to delegate, in accordance with the 
provisions of this section, all or part of the authorities and 
responsibilities of the Secretary under this Act to conduct 
inspection, audits, and investigations to any State with 
respect to all Federal lands or Indian lands within the State; 
except that the Secretary may not undertake such a delegation 
with respect to any Indian lands, except with the permission of 
the Indian tribe allottee involved.]
    (a) Upon written request of any State, the Secretary is 
authorized to delegate, in accordance with the provisions of 
this section, all or part of the authorities and 
responsibilities of the Secretary under this Act to conduct 
inspections, such production and royalty accounting duties and 
responsibilities as the Secretary determines are legally 
delegable, all audit coverage, and investigations to any State 
with respect to all Federal lands within the State.
    (b) After notice and opportunity for a hearing, the 
Secretary is authorized to delegate such authorities and 
responsibilities granted under this section as the State has 
requested, if the Secretary finds that--
          (1) it is likely that the State will provide adequate 
        resources to achieve the purposes of this Act;
          (2) the State has demonstrated that it will 
        effectively and faithfully administer the rules and 
        regulations of the Secretary under this Act in 
        accordance with the requirements of subsections (c) and 
        (d) of this section; [and]
          (3) such delegation will not create an unreasonable 
        burden on any lessee[,]; and
          (4) the State agrees to adopt Federal standardized 
        reporting for Federal royalty accounting and collection 
        purposes,
with respect to the Federal lands and Indian lands within the 
State.
          * * * * * * *
    (g) Upon written request of any State, the Secretary is 
authorized to delegate for any year the responsibility to 
collect royalties from all Federal leases within the State if 
the average amount per year of mineral revenues received by the 
State on all such leases under all Federal mineral leasing laws 
for the previous five years is less than $100,000. The State 
may also request that the Secretary sell the revenue stream 
from all or part of the Federal leases within the State in 
accordance with section 116 of the Federal Oil and Gas Royalty 
Management Act of 1982, as added by section 9518 of the Federal 
Oil and Gas Royalty Simplification and Fairness Act of 1995.
          * * * * * * * deg.


                     TITLE III--GENERAL PROVISIONS

          * * * * * * *

                        [statute of limitations

    [Sec. 307. Except in the case of fraud, any action to 
recover penalties under this Act shall be barred unless the 
action is commenced within 6 years after the date of the act or 
omission which is the basis for the action.]
          * * * * * * *
                              ----------                              


                   OUTER CONTINENTAL SHELF LANDS ACT

          * * * * * * *
  [Sec. 10. Refunds.--(a) Subject to the provisions of 
subsection (b) hereof, when it appears to the satisfaction of 
the Secretary that any person has made a payment to the United 
States in connection with any lease under this Act in excess of 
the amount he was lawfully required to pay, such excess shall 
be repaid without interest to such person or his legal 
representative, if a request for repayment of such excess is 
filed with the Secretary within 2 years after the making of the 
payment, or within 90 days after the effective date of this 
Act. The Secretary shall certify the amounts of all such 
repayments to the Secretary of the Treasury, who is authorized 
and directed to make such repayments out of any moneys in the 
special account established under section 9 of this Act and to 
issue his warrant in settlement thereof.
  [(b) No refund of or credit for such excess payment shall be 
made until after the expiration of 30 days from the date upon 
which a report giving the name of the person to whom the refund 
or credit is to be made, the amount of such refund or credit, 
and a summary of the facts upon which the determination of the 
Secretary was made is submitted to the President of the Senate 
and the Speaker of the House of Representatives for transmittal 
to the appropriate legislative committee of each body, 
respectively: Provided, That if the Congress shall not be in 
session on the date of such submission or shall adjourn prior 
to the expiration of thirty days from the date of such 
submission, then such payment or credit shall not be made until 
thirty days after the opening day of the next succeeding 
session of Congress.]
          * * * * * * *
  Sec. 27. Federal Purchase and Disposition of Oil and Gas.--
(a)(1) Except as may be necessary to comply with the provisions 
of sections 6 and 7 of this Act, all royalties or net profit 
shares, or both accruing to the United States under any oil and 
gas lease issued or maintained in accordance with this Act, 
shall, on demand of the Secretary, be paid in oil or gas. Any 
royalty or net profit share of oil or gas accruing to the 
United States under any such lease, at the Secretary's option, 
may be taken in kind at or near the lease (unless the lease 
expressly provides for delivery at a different location) upon 
prior written notice given reasonably in advance by the 
Secretary to the lessee. Once the United States has commenced 
taking royalty in kind, it shall continue to do so until a 
reasonable time after the Secretary has provided written notice 
reasonably in advance to the lessee that it will resume taking 
royalty in value. Delivery of royalty in kind by the lessee 
shall satisfy in full the lessee's royalty obligation. Once the 
oil or gas is delivered, the lessee shall not be subject to the 
reporting and recordkeeping requirements under section 103 for 
its share of oil and gas production other than records 
necessary to verify the quantity of oil or gas delivered.
          * * * * * * *
  (b)(1) The Secretary, except as provided in this subsection, 
may offer to the public and sell by [competitive bidding for 
not more than its regulated price, or, if no regulated price 
applies, not less than its fair market value] competitive 
bidding or private sale, any part of the oil (A) obtained by 
the United States pursuant to any lease as royalty or net 
profit share, or (B) purchased by the United States pursuant to 
subsection (a)(2) of this section.
          * * * * * * *
  (c)(1) Except as provided in paragraph (2) of this 
subsection, the Secretary, pursuant to such terms as he 
determines, may offer to the public and sell by [competitive 
bidding for not more than its regulated price, or, if no 
regulated price applies, not less than its fair market value] 
competitive bidding or private sale any part of the gas (A) 
obtained by the United States pursuant to a lease as royalty or 
net profit share, or (B) purchased by the United States 
pursuant to subsection (a)(2) of this section.
          * * * * * * *
                              ----------                              


                      INDIAN GAMING REGULATORY ACT

          * * * * * * *

                           COMMISSION FUNDING

  Sec. 18. (a)(1) The Commission shall establish a schedule of 
fees to be paid to the Commission annually by each class II 
gaming activity that is regulated by this Act.
  (2)(A) The rate of the fees imposed under the schedule 
established under paragraph (1) shall be--
          (i) no less than 0.5 percent nor more than 2.5 
        percent of the first [$1,500,000] $2,500,000, and
          (ii) no more than 5 percent of amounts in excess of 
        the first [$1,500,000] $2,500,000,
of the gross revenues from each activity regulated by this Act.
  (B) The total amount of all fees imposed during any fiscal 
year under the schedule established under paragraph (1) shall 
not exceed [$1,500,000] $2,500,000.
          * * * * * * *

                    AUTHORIZATION OF APPROPRIATIONS

  Sec. 19. (a) [Subject to the provisions of section 18, there 
are hereby authorized to be appropriated such sums as may be 
necessary for the operation of the Commission.] Notwithstanding 
the provisions of section 18, no funds may be authorized to be 
appropriated for the operation of the Commission.
          * * * * * * *
                              ----------                              


                     ENDANGERED SPECIES ACT OF 1973

          * * * * * * *

                        interagency cooperation

  Sec. 7. (a)  * * *
          * * * * * * *
  [(d) Limitation on Commitment of Resources.--After initiation 
of consultation required under subsection (a)(2), the Federal 
agency and the permit or license applicant shall not make any 
irreversible or irretrievable commitment of resources with 
respect to the agency action which has the effect of 
foreclosing the formulation or implementation of any reasonable 
and prudent alternative measures which would not violate 
subsection (a)(2).]
  (d) Limitation on Commitment of Resources.--After initiation 
of consultation required under subsection (a)(2) of this 
section, the Federal agency and the permit or license applicant 
shall not make any irreversible or irretrievable commitment of 
resources with respect to the agency action which has the 
effect of foreclosing the formulation or implementation of any 
reasonable and prudent alternative measures which would not 
violate subsection (a)(2) of this section. This limitation on 
the commitment of resources is only applicable to consultations 
regarding site-specific projects and activities, and shall not 
apply to any consultation regarding an agency's periodic or 
long-term planning activities, mission or policy statements, 
programmatic documents, or general policies, regulations, or 
activities, whether or not such consultation has previously 
been initiated pursuant to a court order, and regardless of the 
date on which consultation was ordered or initiated.
          * * * * * * *
                              ----------                              


                SECTION 8 OF THE ACT OF AUGUST 18, 1970

AN ACT To improve the administration of the national park system by the 
Secretary of the Interior, and to clarify the authorities applicable to 
                  the system, and for other purposes.

  Sec. 8. (a) General Authority.--The Secretary of the Interior 
is directed to investigate, study, and continually monitor the 
welfare of areas whose resources exhibit qualities of national 
significance and which may have potential for inclusion in the 
National Park System. [At the beginning of each fiscal year, 
the Secretary shall transmit to the Speaker of the House of 
Representatives and to the President of the Senate, 
comprehensive reports on each of those areas upon which studies 
have been completed. Each such report shall indicate and 
elaborate on the theme(s) which the area represents as 
indicated in the National Park System Plan. On this same date, 
and accompanying such reports, the Secretary shall transmit a 
listing, in generally descending order of importance or merit, 
of not less than twelve such areas which appear to be of 
national significance and which may have potential for 
inclusion in the National Park System. Threats to resource 
values, and cost escalation factors shall be considered in 
listing the order of importance or merit. Such listing may be 
comprised of any areas heretofore submitted under terms of this 
section, and which at the time of listing are not included in 
the National Park System.] Accompanying the annual listing of 
areas shall be a synopsis, for each report previously 
submitted, of the current and changed condition of the resource 
integrity of the area and other relevant factors, compiled as a 
result of continual periodic monitoring and embracing the 
period since the previous such submission or initial report 
submission one year earlier. The Secretary is also directed to 
transmit annually to the Speaker of the House of 
Representatives and to the President of the Senate, at the 
beginning of each fiscal year, a complete and current list of 
all areas included on the Registry of Natural Landmarks and 
those areas of national significance listed on the National 
Register of Historic places which areas exhibit known or 
anticipated damage or threats to the integrity of their 
resources, along with notations as to the nature and severity 
of such damage or threats. Each report and annual listing shall 
be printed as a House document: Provided, That should adequate 
supplies of previously printed identical reports remain 
available, newly submitted identical reports shall be omitted 
from printing upon the receipt by the Speaker of the United 
States House of Representatives of a joint letter from the 
chairman of the Committee on Natural Resources of the United 
States House of Representatives and the chairman of the 
Committee on Energy and Natural Resources of the United States 
Senate indicating such to be the case.
  [(b) The Secretary shall submit to the Committee on Natural 
Resources of the United States House of Representatives and the 
Committee on Energy and Natural Resources of the United States 
Senate, a comprehensive, ``National Park System Plan'', which 
document shall constitute a professional guide for the 
identification of natural and historic themes of the United 
States, and from which candidate areas can be identified and 
selected to constitute units of the National Park System. Such 
plan shall be revised and updated annually.]
  (b) Studies of Areas for Potential Addition.--(1) At the 
beginning of each calendar year, along with the annual budget 
submission, the Secretary shall submit to the Committee on 
Resources of the House of Representatives and to the Committee 
on Energy and Natural Resources of the United States Senate a 
list of areas recommended for study for potential inclusion in 
the National Park System.
  (2) In developing the list to be submitted under this 
subsection, the Secretary shall give consideration to those 
areas that have the greatest potential to meet the established 
criteria of national significance, suitability, and 
feasibility. The Secretary shall give special consideration to 
themes, sites, and resources not already adequately represented 
in the National Park System as identified in the National Park 
System Plan to be developed under section 101 of the National 
Park System Reform Act of 1995.
  (3) No study of the potential of an area for inclusion in the 
National Park System may be initiated after the date of 
enactment of this subsection, except as provided by specific 
authorization of an Act of Congress.
  (4) Nothing in this Act shall limit the authority of the 
National Park Service to conduct preliminary resource 
assessments, gather data on potential study areas, provide 
technical and planning assistance, prepare or process 
nominations for administrative designations, update previous 
studies, or complete reconnaissance surveys of individual areas 
requiring a total expenditure of less than $25,000.
  (5) Nothing in this section shall be construed to apply to or 
to affect or alter the study of any river segment for potential 
addition to the national wild and scenic rivers system or to 
apply to or to affect or alter the study of any trail for 
potential addition to the national trails system.
  (c) Report.--(1) The Secretary shall complete the study for 
each area for potential inclusion in the National Park System 
within 3 complete fiscal years following the date of enactment 
of specific legislation providing for the study of such area. 
Each study under this section shall be prepared with 
appropriate opportunity for public involvement, including at 
least one public meeting in the vicinity of the area under 
study, and after reasonable efforts to notify potentially 
affected landowners and State and local governments.
  (2) In conducting the study, the Secretary shall consider 
whether the area under study--
          (A) possesses nationally significant natural or 
        cultural resources, or outstanding recreational 
        opportunities, and that the area represents one of the 
        most important examples of a particular resource type 
        in the country; and
          (B) is a suitable and feasible addition to the 
        system.
  (3) Each study--
          (A) shall consider the following factors with regard 
        to the area being studied--
                  (i) the rarity and integrity of the 
                resources;
                  (ii) the threats to those resources;
                  (iii) whether similar resources are already 
                protected in the National Park System or in 
                other public or private ownership;
                  (iv) the public use potential;
                  (v) the interpretive and educational 
                potential;
                  (vi) costs associated with acquisition, 
                development and operation;
                  (vii) the socioeconomic impacts of any 
                designation;
                  (viii) the level of local and general public 
                support, and
                  (ix) whether the area is of appropriate 
                configuration to ensure long-term resource 
                protection and visitor use;
          (B) shall consider whether direct National Park 
        Service management or alternative protection by other 
        public agencies or the private sector is appropriate 
        for the area;
          (C) shall identify what alternative or combination of 
        alternatives would in the professional judgment of the 
        Director of the National Park Service be most effective 
        and efficient in protecting significant resources and 
        providing for public enjoyment; and
          (D) may include any other information which the 
        Secretary deems to be relevant.
  (4) Each study shall be completed in compliance with the 
National Environmental Policy Act of 1969.
  (5) The letter transmitting each completed study to Congress 
shall contain a recommendation regarding the Secretary's 
preferred management option for the area.
  (d) New Area Study Office.--The Secretary shall establish a 
single office to be assigned to prepare all new area studies 
and to implement other functions of this section.
  (e) List of Areas.--At the beginning of each calendar year, 
along with the annual budget submission, the Secretary shall 
submit to the Committee on Resources of the House of 
Representatives and to the Committee on Energy and Natural 
Resources of the United States Senate a list of areas which 
have been previously studied which contain primarily historical 
resources, and a list of areas which have been previously 
studied which contain primarily natural resources, in numerical 
order of priority for addition to the National Park System. In 
developing the lists, the Secretary should consider threats to 
resource values, cost escalation factors, and other factors 
listed in subsection (c) of this section. The Secretary should 
only include on the lists areas for which the supporting data 
is current and accurate.
  (f) Authorization of Appropriations.--For the purposes of 
carrying out the studies for potential new Park System units 
and for monitoring the welfare of those resources, there are 
authorized to be appropriated annually not to exceed 
$1,000,000. For the purposes of monitoring the welfare and 
integrity of the national landmarks, there are authorized to be 
appropriated annually not to exceed $1,500,000.
                              ----------                              


                   INDIAN HEALTH CARE IMPROVEMENT ACT

          * * * * * * *

                  TITLE IV--ACCESS TO HEALTH SERVICES

      H3  deg.treatment of payments under medicare program

  Sec. 401. (a) Any payments received by [a hospital or skilled 
nursing facility of the Service (whether operated by the 
Service or by an Indian tribe or tribal organization pursuant 
to a contract under the Indian Self-Determination Act)] 
facility of the Service, Indian tribe, tribal organization, or 
urban Indian organization for services provided to Indians 
eligible for benefits under title XVIII of the Social Security 
Act shall not be considered in determining appropriations for 
health care and services to Indians.
          * * * * * * *
  (c) Notwithstanding any other provision of law, a health 
program of the Indian Health Service, an Indian tribe, tribal 
organization, or urban Indian organization, that is eligible 
for reimbursement for medical assistance under title XVIII of 
the Social Security Act shall be eligible to participate in, 
and receive reimbursement for medical assistance provided to 
individuals served under any plan offered under the Medicare 
Plus plan on the same basis as any other health care provider 
in the State in which the health program of the Indian Health 
Service, an Indian tribe, tribal organization, or urban Indian 
organization is operated.

      H3  deg.treatment of payments under medicaid program

  Sec. 402. (a) Notwithstanding any other provision of law, 
payments to which any facility of the Service, Indian Tribe, 
tribal organization, or urban Indian organization (including a 
hospital, nursing facility, intermediate care facility for the 
mentally retarded, or any other type of facility which provides 
services for which payment is available under title XIX of the 
Social Security Act) is entitled under a State plan by reason 
of section 1911 of such Act shall be placed in a special fund 
to be held by the Secretary and used by him (to such extent or 
in such amounts as are provided in appropriation Acts) 
exclusively for the purpose of making any improvements in the 
facilities of such Service, Indian Tribe, tribal organization, 
or urban Indian organization which may be necessary to achieve 
compliance with the applicable conditions and requirements of 
such title. In making payments from such fund, the Secretary 
shall ensure that each service unit of the Service receives at 
least 80 percent of the amounts to which the facilities of the 
Service, Indian Tribe, tribal organization, or urban Indian 
organization, for which such service unit makes collections, 
are entitled by reason of section 1911 of the Social Security 
Act.
          * * * * * * *
  (c) Notwithstanding any other provision of law, a health 
program of the Indian Health Service, an Indian tribe, tribal 
organization, or urban Indian organization, that is eligible 
for reimbursement for medical assistance under title XIX of the 
Social Security Act shall be eligible to participate in, and 
receive reimbursement for medical assistance provided to 
individuals served under any State plan authorized under any 
law which succeeds such title XIX on the same basis as any 
other health care provider in the State in which the health 
program of the Indian Health Service, an Indian tribe, tribal 
organization, or urban Indian organization is operated.
  (d) Nothing in this section, or any other law, shall prevent 
an Indian eligible for services through an Indian health 
program from participating in any State plan authorized under 
any law which succeeds such title XIX.
  (e) Nothing in this section, or any other law, shall 
authorize a State to deny or limit payments to any provider for 
medical assistance for items or services to Indians.
  (f) Any State that authorizes a health plan under any law 
which succeeds such title XIX or applies for a waiver under 
section 1115 of title XIX of the Social Security Act shall 
consult with the Indian tribes located within the State in the 
development of the health plan's standards.
          * * * * * * *
                              ----------                              


                          SOCIAL SECURITY ACT

          * * * * * * *

        TITLE XVIII--HEALTH INSURANCE FOR THE AGED AND DISABLED

          * * * * * * *

                    Part C--Miscellaneous Provisions

          * * * * * * *

                    indian health service facilities

  Sec. 1880. (a) A [hospital or skilled nursing] facility of 
the Indian Health Service, Indian Tribe, tribal organization, 
or urban Indian organization, whether operated by such Service 
or by an Indian tribe or tribal organization (as those terms 
are defined in section 4 of the Indian Health Care Improvement 
Act), shall be eligible for payments under this title, 
notwithstanding sections 1814(c) and 1835(d), if and for so 
long as it meets all of the conditions and requirements for 
such payments which are applicable [generally to hospitals or 
skilled nursing facilities (as the case may be)] under this 
title.
          * * * * * * *

      TITLE XIX--GRANTS TO STATES FOR MEDICAL ASSISTANCE PROGRAMS

          * * * * * * *

                    INDIAN HEALTH SERVICE FACILITIES

  Sec. 1911. (a) A facility of the Indian Health Service, 
Indian Tribe, tribal organization, or urban Indian organization 
(including a hospital, nursing facility, or any other type of 
facility which provides services of a type otherwise covered 
under the State plan), whether operated by such Service or by 
an Indian tribe or tribal organization (as those terms are 
defined in section 4 of the Indian Health Care Improvement 
Act), shall be eligible for reimbursement for medical 
assistance provided under a State plan if and for so long as it 
meets all of the conditions and requirements which are 
applicable generally to such facilities under this title.
          * * * * * * *

                ROLL NO. 1--VENTO AMENDMENT TO SUBTITLE A               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................        X   ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........  ........  .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........        X   .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................        X   ........  .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................        X   ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................        X   ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........        X   .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       14        27   .........
------------------------------------------------------------------------


               ROLL NO. 2--MILLER AMENDMENT TO SUBTITLE A               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........        X   .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................        X   ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................        X   ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................        X   ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................  ........  ........  .........
Mr. Dooley...............................        X   ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       14        27   .........
------------------------------------------------------------------------


               ROLL NO. 3--MILLER AMENDMENT TO SUBTITLE A               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........        X   .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........        X   .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................        X   ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................  ........  ........  .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................  ........        X   .........
Mr. Abercrombie..........................  ........        X   .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................  ........  ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........        X   .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................        7        33            
------------------------------------------------------------------------


                ROLL NO. 4--VENTO AMENDMENT TO SUBTITLE A               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........  ........  .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................        X   ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........  ........  .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................        X   ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................        X   ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................        X   ........  .........
Mr. Abercrombie..........................  ........        X   .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................  ........  ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       12        25   .........
------------------------------------------------------------------------


             ROLL NO. 5--THORNBERRY AMENDMENT TO SUBTITLE A             
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................        X   ........  .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........  ........  .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................        X   ........  .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................  ........        X   .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................  ........        X   .........
Mr. Richardson...........................        X   ........  .........
Mr. DeFazio..............................  ........        X   .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................  ........        X   .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................  ........        X   .........
Mr. Dooley...............................  ........  ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................        9        27   .........
------------------------------------------------------------------------


             ROLL NO. 6--ABERCROMBIE AMENDMENT TO SUBTITLE A            
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........  ........  .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........        X   .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................        X   ........  .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........  ........  .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................        X   ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................        X   ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........        X   .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........  ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................  ........  ........  .........
                                          ------------------------------
Total....................................       14        22   .........
------------------------------------------------------------------------


               ROLL NO. 7--JOHNSON AMENDMENT TO SUBTITLE B              
------------------------------------------------------------------------
                                               Yea      Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman.......................  ........        X  .........
Mr. Tauzin................................  ........        X  .........
Mr. Hansen................................  ........        X  .........
Mr. Saxton................................  ........        X  .........
Mr. Gallegly..............................  ........  .......  .........
Mr. Duncan................................  ........        X  .........
Mr. Hefley................................        X   .......  .........
Mr. Doolittle.............................  ........        X  .........
Mr. Allard................................        X   .......  .........
Mr. Gilchrest.............................  ........  .......  .........
Mr. Calvert...............................  ........        X  .........
Mr. Pombo.................................  ........        X  .........
Mr. Torkildsen............................  ........        X  .........
Mr. Hayworth..............................        X   .......  .........
Mr. Cremeans..............................  ........  .......  .........
Mrs. Cubin................................  ........        X  .........
Mr. Cooley................................  ........        X  .........
Mrs. Chenoweth............................  ........        X  .........
Mrs. Smith................................  ........  .......  .........
Mr. Radanovich............................  ........        X  .........
Mr. Jones.................................        X   .......  .........
Mr. Thornberry............................  ........        X  .........
Mr. Hastings..............................  ........        X  .........
Mr. Metcalf...............................  ........  .......  .........
Mr. Longley...............................  ........        X  .........
Mr. Shadegg...............................  ........        X  .........
Mr. Ensign................................  ........        X  .........
Mr. Miller................................        X   .......  .........
Mr. Rahall................................        X   .......  .........
Mr. Vento.................................  ........  .......  .........
Mr. Kildee................................        X   .......  .........
Mr. Williams..............................        X   .......  .........
Mr. Gejdenson.............................        X   .......  .........
Mr. Richardson............................        X   .......  .........
Mr. DeFazio...............................        X   .......  .........
Mr. Faleomavaega..........................        X   .......  .........
Mr. Johnson...............................        X   .......  .........
Mr. Abercrombie...........................        X   .......  .........
Mr. Studds................................        X   .......  .........
Mr. Ortiz.................................        X   .......  .........
Mr. Pickett...............................  ........        X  .........
Mr. Pallone...............................  ........  .......  .........
Mr. Dooley................................        X   .......  .........
Mr. Romero-Barcelo........................  ........  .......  .........
Mr. Hinchey...............................  ........  .......  .........
Mr. Underwood.............................  ........  .......  .........
Mr. Farr..................................        X   .......  .........
                                           -----------------------------
      Total...............................       18        19  .........
------------------------------------------------------------------------


              ROLL NO. 8--GEJDENSON AMENDMENT TO SUBTITLE B             
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin,..............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........        X   .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........  ........  .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........  ........  .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................        X   ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................        X   ........  .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........  ........  .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................       12        23   .........
------------------------------------------------------------------------


               ROLL NO. 9--RAHALL AMENDMENT TO SUBTITLE E               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........  ........  .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........        X   .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................        X   ........  .........
Mr. Hayworth.............................  ........        X   .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........  ........  .........
Mr. Radanovich...........................  ........  ........  .........
Mr. Jones................................  ........  ........  .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................        X   ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................  ........  ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................  ........  ........  .........
Mr. Dooley...............................        X   ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       13        18   .........
------------------------------------------------------------------------


               ROLL NO. 10--VENTO AMENDMENT TO SUBTITLE C               
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........  ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................        X   ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........  ........  .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................        X   ........  .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................        X   ........  .........
Mr. Ortiz................................  ........  ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       14        20   .........
------------------------------------------------------------------------


          ROLL NO. 11--HANSEN AMENDMENT TO CREATE NEW SUBTITLE          
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................        X   ........  .........
Mr. Tauzin...............................        X   ........  .........
Mr. Hansen...............................        X   ........  .........
Mr. Saxton...............................        X   ........  .........
Mr. Gallegly.............................        X   ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................        X   ........  .........
Mr. Allard...............................  ........  ........  .........
Mr. Gilchrest............................        X   ........  .........
Mr. Calvert..............................        X   ........  .........
Mr. Pombo................................        X   ........  .........
Mr. Torkildsen...........................  ........  ........  .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................        X   ........  .........
Mrs. Cubin...............................        X   ........  .........
Mr. Cooley...............................        X   ........  .........
Mrs. Chenoweth...........................        X   ........  .........
Mrs. Smith...............................  ........  ........  .........
Mr. Radanovich...........................        X   ........  .........
Mr. Jones................................        X   ........  .........
Mr. Thornberry...........................        X   ........  .........
Mr. Hastings.............................        X   ........  .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................        X   ........  .........
Mr. Shadegg..............................        X   ........  .........
Mr. Ensign...............................        X   ........  .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................  ........        X   .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................  ........        X   .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................  ........        X   .........
Mr. Faleomavaega.........................  ........  ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................  ........        X   .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................  ........        X   .........
Mr. Dooley...............................        X   ........  .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........  ........  .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................       23         7   .........
------------------------------------------------------------------------


               ROLL NO. 12--MILLER AMENDMENT TO SUBTITLE C              
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........        X   .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........  ........  .........
Mr. Gilchrest............................  ........        X   .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........        X   .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........  ........  .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................        8        26   .........
------------------------------------------------------------------------


          ROLL NO. 13--CALVERT EN BLOCK AMENDMENT TO SUBTITLE E         
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................        X   ........  .........
Mr. Tauzin...............................        X   ........  .........
Mr. Hansen...............................        X   ........  .........
Mr. Saxton...............................        X   ........  .........
Mr. Gallegly.............................        X   ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................        X   ........  .........
Mr. Allard...............................  ........  ........  .........
Mr. Gilchrest............................        X   ........  .........
Mr. Calvert..............................        X   ........  .........
Mr. Pombo................................        X   ........  .........
Mr. Torkildsen...........................        X   ........  .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................        X   ........  .........
Mrs. Cubin...............................        X   ........  .........
Mr. Cooley...............................        X   ........  .........
Mrs. Chenoweth...........................        X   ........  .........
Mrs. Smith...............................        X   ........  .........
Mr. Radanovich...........................        X   ........  .........
Mr. Jones................................        X   ........  .........
Mr. Thornberry...........................        X   ........  .........
Mr. Hastings.............................        X   ........  .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................        X   ........  .........
Mr. Shadegg..............................        X   ........  .........
Mr. Ensign...............................        X   ........  .........
Mr. Miller...............................  ........        X   .........
Mr. Rahall...............................  ........        X   .........
Mr. Veto.................................  ........  ........  .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................  ........        X   .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................  ........        X   .........
Mr. Faleomavaega.........................  ........        X   .........
Mr. Johnson..............................  ........        X   .........
Mr. Abercrombie..........................  ........        X   .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................  ........        X   .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................  ........        X   .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........  ........  .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................       22        12            
------------------------------------------------------------------------


            ROLL NO. 14--ABERCROMBIE AMENDMENT TO SUBTITLE E            
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........        X   .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................  ........  ........  .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........  ........  .........
Mr. Gilchrest............................  ........        X   .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................  ........        X   .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................  ........  ........  .........
Mr. Kildee...............................        X   ........  .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................        X   ........  .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................        X   ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................  ........  ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       11        23   .........
------------------------------------------------------------------------


             ROLL NO. 15--GEJDENSON AMENDMENT TO SUBTITLE C             
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................  ........        X   .........
Mr. Tauzin...............................  ........        X   .........
Mr. Hansen...............................  ........        X   .........
Mr. Saxton...............................  ........        X   .........
Mr. Gallegly.............................  ........        X   .........
Mr. Duncan...............................  ........        X   .........
Mr. Hefley...............................  ........        X   .........
Mr. Doolittle............................  ........        X   .........
Mr. Allard...............................  ........        X   .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................  ........        X   .........
Mr. Pombo................................  ........        X   .........
Mr. Torkildsen...........................        X   ........  .........
Mr. Hayworth.............................  ........  ........  .........
Mr. Cremeans.............................  ........        X   .........
Mrs. Cubin...............................  ........        X   .........
Mr. Cooley...............................  ........        X   .........
Mrs. Chenoweth...........................  ........        X   .........
Mrs. Smith...............................  ........        X   .........
Mr. Radanovich...........................  ........        X   .........
Mr. Jones................................  ........        X   .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................  ........        X   .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................  ........        X   .........
Mr. Shadegg..............................  ........        X   .........
Mr. Ensign...............................  ........        X   .........
Mr. Miller...............................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mr. Vento................................        X   ........  .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................        X   ........  .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................  ........        X   .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................        X   ........  .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................        X   ........  .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................        X   ........  .........
Mr. Farr.................................        X   ........  .........
                                          ------------------------------
      Total..............................       11        26   .........
------------------------------------------------------------------------


                       ROLL NO. 16--FINAL PASSAGE                       
------------------------------------------------------------------------
                                              Yea       Nay     Present 
------------------------------------------------------------------------
Mr. Young, Chairman......................        X   ........  .........
Mr. Tauzin...............................        X   ........  .........
Mr. Hansen...............................        X   ........  .........
Mr. Saxton...............................        X   ........  .........
Mr. Gallegly.............................        X   ........  .........
Mr. Duncan...............................  ........  ........  .........
Mr. Hefley...............................        X   ........  .........
Mr. Doolittle............................        X   ........  .........
Mr. Allard...............................        X   ........  .........
Mr. Gilchrest............................  ........  ........  .........
Mr. Calvert..............................        X   ........  .........
Mr. Pombo................................        X   ........  .........
Mr. Torkildsen...........................        X   ........  .........
Mr. Hayworth.............................        X   ........  .........
Mr. Cremeans.............................        X   ........  .........
Mrs. Cubin...............................        X   ........  .........
Mr. Cooley...............................        X   ........  .........
Mrs. Chenoweth...........................        X   ........  .........
Mrs. Smith...............................        X   ........  .........
Mr. Radanovich...........................        X   ........  .........
Mr. Jones................................        X   ........  .........
Mr. Thornberry...........................  ........        X   .........
Mr. Hastings.............................        X   ........  .........
Mr. Metcalf..............................  ........  ........  .........
Mr. Longley..............................        X   ........  .........
Mr. Shadegg..............................        X   ........  .........
Mr. Ensign...............................        X   ........  .........
Mr. Miller...............................  ........        X   .........
Mr. Rahall...............................  ........        X   .........
Mr. Vento................................  ........        X   .........
Mr. Kildee...............................  ........        X   .........
Mr. Williams.............................  ........  ........  .........
Mr. Gejdenson............................  ........        X   .........
Mr. Richardson...........................  ........  ........  .........
Mr. DeFazio..............................  ........        X   .........
Mr. Faleomavaega.........................        X   ........  .........
Mr. Johnson..............................  ........  ........  .........
Mr. Abercrombie..........................  ........        X   .........
Mr. Studds...............................  ........  ........  .........
Mr. Ortiz................................        X   ........  .........
Mr. Pickett..............................  ........  ........  .........
Mr. Pallone..............................  ........        X   .........
Mr. Dooley...............................  ........        X   .........
Mr. Romero-Barcelo.......................  ........  ........  .........
Mr. Hinchey..............................  ........  ........  .........
Mr. Underwood............................  ........        X   .........
Mr. Farr.................................  ........        X   .........
                                          ------------------------------
      Total..............................       25        12   .........
------------------------------------------------------------------------

                      Congressional Budget Office

    With respect to the requirement of clause 2(l)(3)(C) of 
rule XI of the Rules of the House of Representatives and 
section 403 of the Congressional Budget Act of 1974, the 
committee has not received a cost estimate for the committee 
print adopted by the Committee on Resources from the 
Congressional Budget Office [CBO]. When the committee receives 
the estimate from the CBO, it will transmit it to the Committee 
on the Budget.
                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 10, 1995.
Hon. Don Young,
Chairman, Committee on Resources,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the reconciliation 
recommendations of the House Committee on Resources.
    The estimate shows the budgetary effects of the committee's 
proposals over the 1996-2002 period. CBO understands that the 
Committee on the Budget will be responsible for interpreting 
how these proposals compare with the reconciliation 
instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               Congressional Budget office cost estimate

    1. Bill number: Not yet assigned.
    2. Bill title: Reconciliation recommendations of the House 
Committee on Resources.
    3. Bill status: As approved by the House Committee on 
Resources on September 19, 1995.
    4. Bill purpose: The provisions of this bill would reduce 
the budget deficit in future years by requiring the Government 
to sell certain Federal assets, lease the Arctic National 
Wildlife Reserve [ANWR] for oil and gas exploration, establish 
new fees and increase existing fees for the use of resources on 
public lands, allow the beneficiaries of Federal irrigation 
projects to prepay amounts owned to the Treasury for use of 
these facilities, terminate a guaranteed annual grant to the 
Northern Mariana Islands, and allow exports of crude oil from 
Alaska. In particular, the bill would:
          Require the Secretary of the Interior to lease the 
        Arctic National Wildlife Refuge [ANWR] for oil and gas 
        exploration;
          Require the Corps of Engineers to transfer 
        administrative control of certain lands and facilities 
        to the Secretary of Energy and then require the 
        Secretary to sell all land and facilities related to 
        the generation of electricity sold by the Southeastern 
        Power Administration [SEPA];
          Allow the Central Utah Water Conservancy District to 
        prepay amounts under repayment contracts for use of the 
        Central Utah project;
          Terminate a guaranteed annual grant to the Northern 
        Mariana Islands;
          Allow the Bonneville Power Administration [BPA] to 
        refinance its outstanding appropriated debt with the 
        Treasury;
          Reform concession contracts in national parks;
          Increase fees and royalty payments for hardrock 
        mining on Federal lands;
          Increase the payment made to the Federal Government 
        by San Francisco for the use of the Hetch Hetchy Dam:
          Require the Secretary of the Interior to sell the 
        Government's helium reserves;
          Require the Secretary of Agriculture to sell 
        Government-owned ski areas to current operators;
          Increase fees for grazing livestock on Federal lands;
          Allow exports of Alaskan crude oil; and
          Transfer Federal property in Ward Valley, CA
    5. Estimated cost to the Federal Government: CBO estimates 
that enacting those provisions would reduce direct spending and 
increase receipts from asset sales, thereby reducing outlays by 
about $2.3 billion over the 1996-2002 period. Most of these 
savings would be realized by leasing ANWR, selling the 
Southeastern Power Administration [SEPA], and allowing users of 
the Central Utah irrigation project to prepay contract amounts 
owed to the Government for water delivery. Table 1 summarizes 
the budgetary effects of these proposals for the 1996-2002 
period. An attachment to this cost estimate presents an 
itemized summary of the budgetary effects for provisions 
approved by the Resources Committee.
    The 7-year savings total of $2.3 billion would be reduced 
to about $1.4 billion if provisions in another title of the 
reconciliation bill are included in the final bill. Language 
approved by the House Committee on Transportation and 
Infrastructure would prohibit the sale of hydroelectric 
facilities whose output is marketed by SEPA. CBO believes that 
such a prohibition would apply to SEPA and prevent its sale.

         TABLE 1.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON RESOURCES         
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                     1996     1997     1998     1999      2000     2001    2002 
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Estimated budget authority........................      17       760     -89         4       782     175     228
Estimated outlays.................................      45       779     -82         5       700     176     258
                                                                                                                
                                          RECEIPTS FROM ASSET SALES 1 2                                         
                                                                                                                
Estimated budget authority........................  ......    -1,601      -4    -1,503    -1,012      -4      -4
Estimated outlays.................................  ......    -1,609     -12    -1,512    -1,021     -13     -13
----------------------------------------------------------------------------------------------------------------
\1\ Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes of
  congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in   
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   
\2\ These amounts include $1,500 million in estimated receipts for the sale of the Southeastern Power           
  Administration [SEPA] in fiscal year 1999. Those receipts would not be obtained if the final bill includes    
  provisions concerning the Corps of Engineers facilities approved by the Committee on Transportation and       
  Infrastructure. On the other hand, the table's estimates of asset sale proceeds do not include receipts for   
  the proposed sale of the Alaska Power Administration because the bill does not provide the necessary funding  
  for the sale, nor does it include language providing for the tax-exempt financing that is necessary to        
  facilitate such a sale.                                                                                       

    The costs of this bill fall within budget functions 270, 
300, 550, 800, and 950.
    6. Basis of estimate: This estimate assumes that the 
reconciliation bill will be enacted by November 15, 1995; the 
estimate could change if the bill is enacted later.
    Lease of Arctic National Wildlife Refuge.--The bill would 
direct the Secretary of the Interior to open the Arctic 
National Wildlife Refuge to exploration and drilling for oil 
and gas, with the first lease sale occurring in fiscal year 
1997. All bonus bid, rental, and royalty receipts from lease 
sales would be split evenly between the Federal Government and 
the State of Alaska. The first lease sale would be required to 
take place within 12 months of the bill's enactment.
    Based on previous analyses by DOI of potential tract 
values, CBO estimates that competitive bidding in the first 
lease sale would yield bonuses totaling approximately $1.6 
billion. Annual rentals from leases issued in the first lease 
sale would total about $1 million after the lease sale takes 
place. We expect that a second lease sale would occur about 36 
months after the first sale and yield additional bonus bids of 
about $1 billion in fiscal year 2000, for total bonus bids of 
$2.6 billion. Net of payments to Alaska, Federal receipts from 
these sales would total about $1.3 billion. Because royalties 
would be paid only after production has begun, any payments of 
royalties are unlikely to occur until after 2002.
    The bill would create direct spending authority from some 
of the receipts from ANWR leasing. It would establish a 
Community Assistance Fund in the Treasury to be maintained at a 
level of $5 million using Federal revenues from ANWR 
development. The fund would be spent on assistance to local 
governments and Indian entities affected by the proposed 
exploration and development of the Coastal Plain. CBO estimates 
that these Federal assistance payments would increase direct 
spending outlays by about $15 million over the 1996-2002 
period.
    In addition, subtitle K would establish a National 
Endowment for Fish and Wildlife, consisting of up to $250 
million of the Federal share of revenues deposited into the 
Treasury from oil and gas leasing within the Coastal Plain. 
Deposits to the endowment would occur only to the extent that 
the Government's net receipts (after payments to Alaska) exceed 
$1.3 billion. The provision would give a new Fish and Wildlife 
Commission authority to make expenditures from this endowment, 
thus creating direct spending authority. CBO's point estimate 
for the net Federal receipts is $1.3 billion, but given the 
uncertainty surrounding such projections, receipts could be 
significantly higher or lower. Therefore, it is reasonably 
likely that some receipts would be deposited in the endowment 
and subsequently be spent.
    Most estimates associated with this and other legislation 
could be either too high or too low. Hopefully, the errors 
balance out and the aggregate estimate is about right. The 
provision allowing for the spending of ANWR proceeds in excess 
of CBO's point estimate tilts the scales by reducing the 
possibility that savings could exceed our estimate, while 
leaving unchanged the likelihood that they could be less. This 
provision, therefore, reduces the total budgetary savings that 
this bill can be expected to achieve.
    Assuming a 50-percent probability that net Federal receipts 
would equal or exceed $1.3 billion, expected deposits into the 
endowment would amount to $75 million in fiscal year 2000 and 
expected spending from the fund would total $45 million in 2001 
and 2002. Taking into account the possibility of this 
additional spending, along with outlays from the Community 
Assistance Fund, reduces the expected budgetary savings from 
the ANWR lease sales to $1,243 million over the 1996-2002 
period (see table 2).

     TABLE 2.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL TO LEASE THE ARCTIC NATIONAL WILDLIFE REFUGE     
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                       1996     1997     1998    1999     2000     2001    2002 
----------------------------------------------------------------------------------------------------------------
                                          RECEIPTS FROM ASSET SALES \1\                                         
                                                                                                                
Estimated budget authority..........................       0    -1,601      -1      -1    -1,001      -1      -1
Estimated outlays...................................       0    -1,601      -1      -1    -1,001      -1      -1
                                                                                                                
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Estimated budget authority..........................       0       800       5       5       581       6       6
Estimated outlays...................................       0       800       1       2       504      13     43 
----------------------------------------------------------------------------------------------------------------
\1\ Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes of
  congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in   
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   

    For purposes of this estimate, CBO assumes that potential 
legal challenges would not prevent DOI from issuing regulations 
and holding the first lease sale within 12 months of the 
enactment of the bill. If Alaska brings suit against the 
Federal Government challenging the receipts-sharing provisions, 
the first lease sale may not occur within 12 months of 
enactment. Further, CBO assumes that the provisions in the bill 
relating to Alaska National Interest Lands would have no impact 
on the Federal budget. We cannot predict the likelihood or the 
extent to which potential legal actions might delay or prohibit 
the lease sales called for in the bill.
    In addition to the changes in direct spending and asset 
sale proceeds, CBO estimates that implementing the rules and 
regulations required by the bill would increase administrative 
costs at DOI by about $2 million in fiscal year 1996 and by 
about $22 million over the 1996-2002 period.
    Sale of Southeastern Power Administration.--CBO estimates 
that a competitive sale of SEPA as defined in section 9201 
would result in proceeds to the Treasury of about $1.5 billion 
near the end of fiscal year 1999. Costs to prepare for the sale 
would be about $6 million. Following the sale of SEPA, we 
estimate the Government would lose about $750 million over the 
2000-02 period from forgone receipts from the sale of 
electricity. These changes are summarized in table 3.

     TABLE 3.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL TO SELL THE SOUTHEASTERN POWER ADMINISTRATION    
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                          1995      1996     1997     1998     1999      2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
Offsetting receipts under current law:                                                                          
    Estimated budget authority........      -160     -175     -180     -185      -190     -190     -190     -190
    Estimated outlays.................      -160     -175     -180     -185      -190     -190     -190     -190
Proposed changes:                                                                                               
    Cost of sale preparation:                                                                                   
        Estimated budget authority....  ........        1        1        1         3  .......  .......  .......
        Estimated outlays.............  ........        1        1        1         3  .......  .......  .......
    Forgone offsetting receipts:                                                                                
        Estimated budget authority....  ........  .......  .......  .......  ........      190      190      190
        Estimated outlays.............  ........  .......  .......  .......  ........      190      190      190
    Asset sale proceeds 1 2:                                                                                    
        Estimated budget authority....  ........  .......  .......  .......    -1,500  .......  .......  .......
        Estimated outlays.............  ........  .......  .......  .......    -1,500  .......  .......  .......
Net spending under proposal:                                                                                    
    Estimated budget authority........      -160     -174     -179     -184    -1,687  .......  .......  .......
    Estimated outlays.................      -160     -174     -179     -184    -1,687  .......  .......  .......
----------------------------------------------------------------------------------------------------------------
\1\ Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes of
  congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in   
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   
\2\ Section 10003 of this bill, as approved by the Committee on Transportation and Infrastructure, would        
  prohibit the sale of any project or project feature operated by the Corps of Engineers. All power sold by SEPA
  is generated at facilities operated by the corps; therefore, CBO estimates that enacting both sections 9201   
  and 10003 would not result in any proceeds from the sale of SEPA.                                             

    The estimated sales price is based on a projection of 
after-tax cash flow to a private purchaser. We assume that 
power revenues from SEPA facilities would rise significantly 
following the sale, narrowing the current gap between Federal 
and non-Federal wholesale electricity prices in the region. 
Based on information from DOE and the electric utility 
industry, we estimate that Federal power is currently priced 25 
to 75 percent below non-Federal power in the region. The bill 
would cap rate increases that could be passed on to those 
wholesale customers that receive more than 20 percent of their 
power supply from SEPA. Current sales information indicates 
that this restriction would affect less than 5 percent of the 
power sales from SEPA facilities. In addition, we assume that a 
non-Federal purchaser of the SEPA projects would be required to 
fund all project operations and maintenance, including 
recreation, navigation, and flood-control costs, and that a 
non-Federal owner could achieve some cost efficiency relative 
to Government operation.
    Section 10003 of this bill (as approved separately by the 
Committee on Transportation and Infrastructure) would prohibit 
the sale of any project or project feature operated by the 
Corps of Engineers. All power sold by SEPA is generated at 
facilities operated by the corps; therefore, CBO estimates that 
enacting both sections 9201 and 10003 would not result in any 
proceeds from the sale of SEPA.
    Central Utah project prepayments.--Section 9211 would amend 
the Central Utah Project Completion Act to allow for the 
prepayment by the Central Utah Water Conservancy District of 
repayments owed to the Bureau of Reclamation under the same 
terms and conditions as are contained in the supplemental 
contract providing for prepayments related to the Jordan 
Aqueduct System.
    Based on information provided by the Bureau and the Central 
Utah Water Conservancy District, CBO estimates that the bill 
would result in prepayment receipts totaling $69 million in 
1997, $129 million in 1998, and $33 million in 2001. The income 
from prepayments would be partially offset by a loss of 
offsetting receipts totaling $2.4 million annually. About $2 
million of this amount is spent annually without appropriation 
for mandatory payments to the Ute Indian Tribe. The remainder 
is deposited in the U.S. Treasury. For purposes of this 
estimate, CBO assumes that payments to the tribe will continue 
after prepayment.
    CBO estimates that a prepayment for already-completed 
segments of the central Utah project totaling roughly $69 
million would occur in 1997. Prepayments for the remaining 
segments, the Jordanelle unit and the Diamond Fork system, 
would occur in fiscal years 1998 and 2001, respectively, when 
construction of these two sets of facilities should be 
completed. The prepayment estimates are based on current cost 
allocations and construction costs incurred up to September 30, 
1994.
    These estimated budgetary effects of changes to the central 
Utah project are summarized in table 4.

              TABLE 4.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON THE CENTRAL UTAH PROJECT             
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                  1995    1996    1997     1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                            DIRECT SPENDING                                                     
                                                                                                                
Net spending under current law:                                                                                 
    Estimated budget authority.................   (\1\)   (\1\)   (\1\)    (\1\)   (\1\)   (\1\)   (\1\)   (\1\)
    Estimated outlays..........................   (\1\)   (\1\)   (\1\)    (\1\)   (\1\)   (\1\)   (\1\)   (\1\)
Proposed changes:                                                                                               
    Estimate budget authority..................  ......  ......     -67     -127       2       2     -31       2
    Estimated outlays..........................  ......  ......     -67     -127       2       2     -31       2
Net spending under proposal:                                                                                    
    Estimate budget authority..................   (\1\)   (\1\)     -67     -127       2       2     -31       2
    Estimated outlays..........................   (\1\)   (\1\)     -67     -127       2       2     -31       2
----------------------------------------------------------------------------------------------------------------
\1\ Less than $500,000.                                                                                         

    Northern Mariana Islands Grant.--Section 9401 would 
terminate the guaranteed annual grant of about $28 million made 
by the United States to the Northern Mariana Islands. Based on 
the historical rate at which such funds have been spent, we 
estimate that some spending for the Northern Marianas would 
continue through 1999 from budget authority provided in 1995 
and prior years. Total savings would amount to $126 million 
over the 1996-2002 period. In addition to eliminating new grant 
obligations beginning in 1996, this provision would rescind any 
remaining funds not obligated at the time of enactment. CBO 
estimates, however, that budget authority provided in 1995 and 
prior years will be fully obligated before enactment.
    Bonneville Power Administration debt refinancing.--Section 
9205 would change the procedures the Bonneville Power 
Administration uses to determine the amounts the agency charges 
its electricity customers to repay prior Government 
appropriations that financed the construction of the 
hydroelectric system in the Pacific Northwest. Starting in 
1996, the bill would direct BPA and the Treasury to redefine 
the outstanding appropriated construction costs of the BPA 
system, and would assign a new and higher interest rate to be 
applied to the outstanding construction costs. The value to the 
Treasury of such payments would increase slightly, but BPA 
would have to commit, in its contracts for the sale of 
electricity, that it would not assess any additional charges in 
the future--after reflecting changes necessitated by this 
bill--to cover previously appropriated construction costs.
    By restructuring BPA's appropriated debt, the bill would 
increase the debt service payments the agency makes to the 
Treasury by about $30 million annually over the 1996-2002 
period. BPA would finance this increase in intragovernmental 
payments by charging higher rates for the sale of electricity, 
which would increase the amount of offsetting collections 
received by the Government. At the same time, however, the bill 
would permanently appropriate funds to BPA to pay for part of 
the Federal Government's settlement with the Colville Tribe. 
Over the 1996-2002 period, these appropriations would total 
about $90 million. CBO estimates that the net budgetary savings 
of these provisions over the 7-year period would be $120 
million, as shown in table 5.

                TABLE 5.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON REFINANCING BPA DEBT               
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                           1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Additional offsetting receipts:                                                                                 
    Appropriations repayment:                                                                                   
        Estimated budget authority......................     -31     -30     -31     -30     -30     -29     -29
        Estimated outlays...............................     -31     -30     -31     -30     -30     -29     -29
Reduction in offsetting receipts:                                                                               
    Colville Tribe payment credits:                                                                             
        Estimated budget authority......................      15      16      16      17      18       4       4
        Estimated outlays...............................      15      16      16      17      18       4       4
Net budgetary impact of proposal:                                                                               
    Estimated budget authority..........................     -16     -14     -15     -13     -12     -25     -25
    Estimated outlays...................................     -16     -14     -15     -13     -12     -25     -25
----------------------------------------------------------------------------------------------------------------

    Concession contracts at national parks.--Section 9301 would 
repeal existing laws governing the use of concessions contracts 
by Federal land management agencies such as the National Park 
Service [NPS] and the U.S. Forest Service (except for ski 
concessions). The bill would establish new concession policies 
and practices to be adopted by these agencies, including 
requirements for competitive bidding, performance evaluations 
of contractors, and treatment of concessioner capital 
investments on Federal lands. This section also would revise 
existing agency practices that govern concessioner deposits to, 
and spending from, contractor-held bank accounts. Federal 
agencies would have 2 years in which to promulgate new 
regulations implementing the legislation, after which the 
authority to execute or extend any concession contract would 
terminate. Section 9312 would require Federal agencies to 
deposit concession receipts into the general fund of the U.S. 
Treasury. The NPS, however, would be permitted to retain and 
use without further appropriation any receipts that exceed 
amounts specified in section 9312(b) for each of fiscal years 
1997 through 2002.
    Assuming that Federal agencies promulgate the necessary 
regulations to implement these provisions within the next 2 
years, CBO estimates that this legislation would increase 
offsetting receipts by about $5 million in fiscal year 1998. 
The amount of new annual receipts would increase to about $27 
million by 2002, resulting in total savings over the 7-year 
period of about $27 million by 2002, resulting in total savings 
over the 7-year period of about $80 million. These amounts are 
net of small amounts of additional direct spending for payments 
to States that would result from the new Forest Service 
receipts and for new spending that would occur if receipts from 
NPS concessions exceed the amounts specified in section 
9312(b).
    Hardrock mining.--Section 9501 would make a number of 
changes to the general mining law of 1872, the primary law 
governing the production of hardrock minerals on Federal lands. 
This bill would make permanent the existing requirements 
(currently set to expire in 1998) that owners of unpatented 
mining claims pay an initial $25 location fee and an annual 
$100 maintenance fee. Claimholders would be allowed to receive 
a credit against the annual maintenance fee for certain labor 
costs associated with developing the claims. Small claimholders 
would no longer be exempt from paying the maintenance fee. New 
claimholders would no longer have to pay the maintenance fee 
for the year in which the claim is initially staked.
    This bill also would subject the production and sale of 
locatable minerals to a 3.5-percent royalty on the net proceeds 
from the claim if the mine's annual net proceeds exceed 
$50,000. One-third of the royalty receipts would be distributed 
to the State in which the mining claim is located. Finally, the 
bill would require that claimants pay the fair market value of 
the surface land for any acres issued a patent and would make 
changes to the program for managing certain mineral materials 
on Federal lands. Claimants would be exempt from paying the 
royalty and patent fees if they file an application to survey 
or purchase the claim within 2 years after the date of 
enactment of the bill.
    In total, CBO estimates that enactment of this provision 
would decrease offsetting receipts to the Federal Treasury, net 
of royalty receipts shared with the States, by about $3 million 
in 1996. These losses would result from provisions that would 
exempt new claimholders from paying the annual maintenance fee 
in the first year the claim is staked. Over the 1996-2002 
period, however, we estimate that offsetting receipts would 
increase by about $76 million, primarily from extension of the 
annual maintenance fee beyond 1998, as shown in table 6.

      TABLE 6.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON CHANGES TO LEASING FROM HARDROCK MINING      
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                   1995    1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                                 DIRECT SPENDING                                                
                                                                                                                
Net spending under current law:                                                                                 
    Estimated budget authority..................     -33     -33     -33     -33  ......  ......  ......  ......
    Estimated outlays...........................     -33     -33     -33     -33  ......  ......  ......  ......
Proposed changes:                                                                                               
    Estimated budget authority..................  ......       3      15      16     -24     -24     -31     -31
    Estimated outlays...........................  ......       3      15      16     -24     -24     -31     -31
Net spending under proposal:                                                                                    
    Estimated budget authority..................     -33     -30     -17     -17     -24     -24     -31     -31
    Estimated outlays...........................     -33     -30     -17     -17     -24     -24     -31     -31
----------------------------------------------------------------------------------------------------------------

    Hetch Hetchy fees.--Section 9214 would amend provisions of 
current law that govern the amount and disposition of payments 
made by the city of San Francisco to the Federal Government for 
use of land within Yosemite National Park. The annual payment 
is currently set at $30,000 and is retained and used by the NPS 
without further appropriation. Section 9214 would increase the 
payment to $8 million and would require that the proceeds be 
placed in a separate Federal fund. Spending from the fund would 
be subject to appropriations action. These amendments would 
increase offsetting receipts by about $56 million over the 
1996-2002 period.
    Sale of helium reserves.--Section 9011 would privatize the 
Bureau of Mines refined helium facilities, and eventually, its 
reserve of crude helium. The bill would direct the Secretary of 
the Interior to stop producing, refining, and selling helium 
within 18 months after enactment and to dispose of all refining 
facilities within 2 yeas after enactment.
    CBO estimates that the changes to the helium operations--
primarily from the sale of crude helium--resulting from the 
enactment of this bill would produce a savings to the helium 
fund of about $53 million from fiscal years 1996 through 2002.
    Grazing fees.--Section 9331 would change the formulas for 
calculating livestock grazing fees. The new fee formula for 
beef cattle would be based on the 3-year average of the total 
gross value of production for beef cattle and the 10-year 
average of the rate for new issues of 6-month Treasury bills. 
We expect that this formula would increase receipts relative to 
current law. Another section would revise the definition of 
animal unit month [AUM] by increasing the number of sheep and 
goats per AUM from five to seven. That provision would slightly 
decrease receipts relative to current law. The changes in 
offsetting receipts would total about $34 million over the 
1996-2002 period.
    Current law requires that the Forest Service and the Bureau 
of Land Management pay a portion of the offsetting receipts 
from grazing on public lands to the States. CBO estimates that 
payments to States for grazing on public lands, under current 
law, will be about $5 million in fiscal year 1996 and about $44 
million over the 1996-2002 period. We estimate that enacting 
the bill, by raising receipts from grazing fees, would increase 
payments to States by less than $1 million in fiscal year 1996 
and by about $8 million over the 1996-2002 period. As a result, 
net savings from these provisions would total $26 million over 
the 1996-2002 period.
    Sale of Government-owned ski areas.--Section 9321 would 
require the Secretary of Agriculture to offer to sell Forest 
Service lands currently used under permit as ski areas. The 
bill would require the Secretary to offer to sell such property 
to at least 40 qualifying operators of ski areas within 5 years 
of enactment of the bill. Sales would be at the fair market 
value based on appraisals of the lands, excluding the value of 
any improvements on the land made by the concessioner. Ski 
operators would qualify to buy the Federal lands on which they 
operate if they were under a lease when the bill was enacted, 
had improvements on the land with a fair market value greater 
than $2 million, and were located adjacent to the boundary of 
Federal lands or other significant private holdings.
    Section 9321 would allow the Secretary to retain 50 percent 
of the proceeds from such sales to acquire other high-priority 
lands. The remaining 50 percent would be deposited into the 
general fund of the Treasury.
    This provision would have four budgetary effects: (1) Asset 
sale receipts from the sale of lands to certain ski operators, 
(2) a loss of fees paid to the Government by those operators, 
(3) a reduction in payments to States because of that loss in 
fee collections, (States currently receive 25 percent of such 
fees), and (4) an increase in Federal spending for land 
acquisition. On balance, CBO estimates that these effects would 
reduce net spending by about $21 million over the 1996-2002 
period. Over that period, we estimate asset sale receipts of 
$48 million, new spending for land acquisition of $24 million, 
and a loss of fees, net of payments to States, of about $3 
million.
    Exports of Alaskan crude oil.--Based on information from 
the Department of Energy and industry sources, CBO expects that 
the export of Alaska North Slope [ANS] oil would result in a 
temporary increase in the price of oil paid to producers on the 
west coast. Higher west coast oil prices would produce 
additional income to the Federal Government from the sale of 
oil from federally owned reserves and from royalties on Federal 
leases in California and Alaska. We estimate that the 
additional income resulting from price increases would total 
about $21 million over the 1996-2002 period. Over half of this 
income would be collected by 1997, because the effect of 
exports on west coast prices is likely to diminish over time 
and because the source of Federal receipts most affected by a 
price hike--the Elk Hills Naval Petroleum Reserve in 
California--would be sold to the private sector near the 
beginning of fiscal year 1997, assuming that other titles of 
this reconciliation measure are enacted. (The sale of the Elk 
Hills reserve is included in provisions approved by both the 
House Committee on Commerce and the House Committee on National 
Security.)
    California land sale.--Section 9341 would transfer Federal 
property in California to the State of California in exchange 
for $510,000. CBO estimates this transaction would occur 
shortly after enactment of this bill.
    Ski fees.--Section 9322 would establish a new formula for 
determining fees to be paid to the Government by ski areas 
located on Federal lands. CBO estimates that enacting this 
section would reduce the collection of offsetting receipts by 
about $8 million during the 1996-2002 period. Enactment also 
would decrease direct spending by about $2 million during that 
period because of reduced payments to States. Overall, CBO 
expects the net change to be an increase in outlays of $6 
million over the 1996-2002 period.
    Based on information from the Forest Service, CBO estimates 
that the proposed new fee formula would increase receipts from 
permit fees slightly in the long term, but that receipts would 
drop in the 1996-2002 period because of the provision allowing 
current permittees to select the fee formula they prefer.
    Depending on their revenues, some ski areas would pay less 
in fees under the proposed formula than they pay now, while 
other areas would pay more. As current permits expire and new 
permits are issued, more permits would be subject to the 
proposed new fee-assessment method. Over time, therefore, fewer 
permittees would be able to select a lower fee-assessment 
method and expected receipts would return to (and eventually 
exceed) current levels. But because most permits will expire 
after the year 2000, CBO expects an overall loss in receipts in 
the 1996-2002 period.
    Sly Park Irrigation Unit.--Section 9213 would direct the 
Secretary of the Interior to sell the Sly Park Dam and 
Reservoir, the Camp Creek Diversion Dam and Tunnel, and related 
interests and associated water rights to the El Dorado 
Irrigation District in El Dorado County, CA, within 1 year of 
enactment of this bill. CBO estimates that enactment of this 
provision would have no net budgetary impact. The bill would 
allow the purchasers to pay the Government over 20 years at 
2.5-percent interest, and would not allow the purchase price to 
exceed approximately $21 million. Under current law, the users 
of this irrigation unit pay about $1 million annually to the 
Government to pay the capital and interest costs of 
constructing the facilities. CBO assumes the users would be 
willing to purchase the project (over 20 years) if the annual 
cost does not exceed the current annual $1 million payment made 
to the Government. Assuming the El Dorado Irrigation District 
pays at least $12 million plus interest in purchase payments 
for the project over 20 years, enactment of this provision 
would have no net cost. This estimate assumes that purchase 
payments under the bill would be approximately equal to the 
current annual receipts from the district.
    Sale of Alaska Power Administration.--Section 9003 would 
authorize the sale of the Alaska Power Administrative [APA] in 
accordance with the terms and conditions of the existing 
negotiated purchase agreements between the Department of Energy 
and the potential purchasers of the APA. CBO believes that 
enactment of this section would not, by itself, result in the 
sale of the APA because the bill does not provide funding for 
sale preparation and transactions costs, which we estimate at 
$4 million in 1996, nor does the bill amend current law to 
allow the State of Alaska to issue tax-exempt debt to finance 
part of the purchase of the APA. The purchase agreements call 
for a change in law to allow this type of financing. 
Consequently, enactment of this section would not change 
mandatory spending or receipts.
    Indian gaming.--Section 9601 would increase the amount of 
fees that can be levied on class II gaming facilities on Indian 
lands by the National Gaming Commission from $1.5 to $2.5 
million. Fees collected by the Commission are offsetting 
collections; they may be spent by the Commission without 
further appropriations action. Therefore, increasing the amount 
that may be collected would have no net budgetary impact.
    Mapping.--Section 9801 directs the Secretary of the 
Interior to develop an inventory of all surveying and mapping 
activities currently provided by the Department of the Interior 
and to develop and implement a plan within 180 days of 
enactment of this legislation for contracting out these 
activities to private firms. While this provision could result 
in a reduction in costs of personnel and equipment for 
surveying and mapping, CBO estimates that these cost reductions 
would be offset by increased contracting expenditures. In sum, 
CBO estimates that this provision would have no significant net 
budgetary impact. In any event, all such changes in costs of 
surveying and mapping activities would be subject to 
appropriations action.
    Oil and gas royalties.--Section 9511, the Federal Oil and 
Gas Royalty Simplification and Fairness Act of 1995, would make 
a number of changes to the Federal Government' procedures for 
collecting royalty payments on oil and gas extracted from 
Federal lands (both onshore and offshore). Specifically, the 
bill would impose a 6-year statute of limitations on audits of 
oil-and gas-lease performance and would require that 
administrative appeals be completed within 3 years from the 
date of appeal. The Federal Government would be required to pay 
interest on royalty overpayments made by oil and gas companies. 
This section also would ease reporting requirements for lessees 
with oil and gas production that is defined as ``marginal'' and 
allow for the prepayment of royalties from these leases. The 
bill would also clarify the policy on allocating production 
among leases, delay for 1 month the payment of gas royalties, 
and make many other changes to the reporting requirements for 
oil and gas leases.
    Several of these changes would advance the collection of 
money that the Federal Government is owed from ongoing oil-and 
gas-leasing activities, although the total amount of royalties 
due to the Federal Government over time would not change. In 
total, we estimate that provisions that fix the statute of 
limitations at 6 years, require appeals to be completed within 
3 years, clarify the policy on allocating production among 
certain lessees, and allow for the prepayment of certain 
royalties, would shift--from years after 2002--$3 million in 
collections into 1996 and a total of about $111 million into 
the 1996-2002 period. These amounts are net of payments to 
States of their portion of onshore collections.
    On the other hand, the obligations of the Federal 
Government to lessees would be expanded by this bill. Beginning 
September 1, 1996, the Federal Government would be required to 
pay or credit interest on overpayments at the rate specified in 
the Internal Revenue Service Code for overpayments. The bill 
would disallow payment of interest only if a lessee's 
overpayments for a given month exceed 25 percent of the total 
royalties due on all of its Federal leases. The bill also would 
remove restrictions on the time allowed for lessees to request 
refunds. In both cases, these payments would be deducted from 
receipts from royalties, rents, and bonuses. The share borne by 
States would be deducted from their payments.
    According to data provided by the Minerals Management 
Service [MMS], overpayments currently average about 3 percent 
of the royalties paid each year. For the purposes of this 
estimate, we assume that the amount of overpayments would 
increase slightly (to nearly 5 percent) because any excess 
payments would now earn interest at a rate that is 2 percent 
above the Treasury's short-term rate. We estimate that 
requiring the Government to pay interest on royalty 
overpayments would increase Federal outlays by about $9 million 
annually starting in 1997, net of payments by States. If 
overpayments reach the 25-percent cap in the bill, Federal 
outlays would be correspondingly higher. Based on information 
provided by MMS, we estimate that the removing the time limit 
for refund requests would result in an increase in Federal 
outlays of about $1 million per year beginning in 1998, net of 
payments by States.
    One provision in this part would create a new due date for 
the payment of royalties on gas produced on Federal leases, 
effectively delaying the requirement for payment of such 
royalties by 1 month. CBO estimates that while the total amount 
of royalties from gas production owed the Federal Government 
would not change, shifting the due date for such payments by 1 
month would result in the loss of about $140 million over the 
1996-2002 period. Depending on how the Secretary of the 
Interior implements this provision, the loss could be realized 
entirely in 1996 or over several years. This estimate assumes 
the latter.
    In total, CBO estimates that enacting these provisions 
would increase net spending by about $15 million in 1996 and 
$81 million over 7 years. A number of provisions in this part--
in particular those making it more difficult to audit lessee 
records--that could result in additional losses of receipts to 
the MMS, but we do not expect such losses to be significant in 
any year.
    Indian health.--Under current law, Indian Health Service 
[IHS] facilities operated by the service, a tribal 
organization, or an Indian tribe may be reimbursed for services 
rendered under a State Medicaid plan, provided the facility 
meets the requirements and conditions generally applicable to 
such facilities under title XIX of the Social Security Act. 
Section 402 of the Indian Health Care Improvement Act also 
specifies that the Secretary of Health and Human Services shall 
place in a special fund, payments for which IHS facilities are 
entitled under State Medicaid plans. These funds shall be used 
to make any improvements necessary for these facilities to 
comply with the applicable conditions and requirements of title 
XIX.
    Sections 9901 and 9902 of this bill would extend 
eligibility for reimbursement under State plans to facilities 
of Indian tribes, urban Indian organizations, and tribal 
organizations. It also would amend section 402 of the Indian 
Health Care Improvement Act. This amendment would allow any 
health program of the IHS, an Indian tribe, tribal 
organization, or urban Indian organization that is eligible for 
reimbursement under title XIX to participate in and receive 
reimbursement under State plans authorized under any law 
succeeding title XIX. These health programs would be eligible 
for reimbursement on the same basis as any other health care 
provider in the State in which they operate.
    This bill also would require that all Indians eligible for 
services through an Indian health program be allowed to 
participate in any State plan that succeeds title XIX. 
Additionally, this provision would require that States 
authorizing health plans under any State laws succeeding title 
XIX must work with the Indian tribes located within their 
boundaries in developing the health plan's standards.
    Finally, this bill would require that the Secretary of 
Health and Human Services conduct a study of the number of 
Indians eligible for services under title XIX, the number of 
Indians receiving these services, and the impact upon Indian 
communities of eliminating the entitlement status of title XIX 
and transferring funding from this title to the States. The 
Secretary shall also make recommendations regarding the 
improvement of these services to eligible Indians. This report 
would have to be submitted to the Congress by June 1, 1996.
    Under the Commerce Committee's Medicaid proposal, which is 
also part of the reconciliation bill, this provision would have 
no Federal budgetary impact. Under the proposed Medigrant 
Program, the Federal share of medical assistance payments would 
be capped. Because CBO assumes that Federal spending would be 
at the cap amounts, the additional cost of this provision would 
not be passed on the Federal Government. Under current law, 
this provision would result in additional costs to the Federal 
Government.
    Sections 9904 and 9905 would allow all health programs 
operated by the IHS, Indian tribes, tribal organizations, and 
urban Indian organizations to participate in Medicare on the 
same basis as any other health care provider. These 
organizations will also be eligible for reimbursement for 
service provided to individuals participating in a Medicare 
Plus plan. CBO estimates that this provision would 
approximately double the level of Medicare reimbursements 
currently paid to eligible IHS and tribal facilities. Under 
this assumption, the cost of this expansion will be $56 million 
in fiscal year 1996. Factoring in inflation, additional outlays 
would rise to $136 million in fiscal year 2002. These funds can 
be used by IHS to make any improvements necessary for its 
facilities to comply with the applicable conditions and 
requirements of title XVIII.
    Under current law, only specific types of IHS and tribally 
operated health care facilities may participate in the Medicare 
Program. IHS hospitals and skilled nursing facilities, tribal 
health providers that own their own facilities, and tribal 
facilities that are certified as federally qualified health 
centers [FQHC's] may receive reimbursement under Medicare. To 
quality as a FQHC, a tribal program must be contracted or 
compacted under the Indian Self-Determination Act or urban 
clinics. Because the IHS does not provide nursing care at this 
time, there are no IHS-operated nursing facilities.
    Currently, most tribal health programs operate out of IHS-
owned facilities. However, these programs are excluded from 
participating in Medicare, unless they are hospitals or FQHC 
clinics.
    7. Estimated cost to State and local governments: A number 
of provisions would directly affect the budgets of State and 
local governments, including State and municipal utilities and 
irrigation districts. Most of these provisions would benefit 
State governments or local entities by increasing income shared 
by States and the Federal Government or by authorizing 
voluntary transactions.
    Arctic National Wildlife Refuge.--The State of Alaska would 
share 50 percent of all bonus bids, rentals, and royalties 
realized from enactment of this provision. As a result, CBO 
estimates that payments to Alaska from mineral development 
activities on Federal lands within the State would increase by 
approximately $1.3 billion during the 1996-2002 period.
    In addition, this section would establish a community 
assistance fund in the Treasury to be funded at an annual level 
of $5 million out of the Federal share of revenues from ANWR 
development. As a result, CBO estimates that the Federal 
assistance payments to local governments and Indian entities 
affected by the proposed exploration and development of the 
Coastal Plain would total about $15 million over the 1996-2002 
period.
    Sale of Southeastern Power Administration.--The sale of 
SEPA to a non-Federal entity would result in an increase in the 
rates paid by SEPA customers, some of which are public 
utilities, including municipal utilities, State utilities, 
public utility districts, and irrigation districts. While these 
provisions would therefore increase the costs of the affected 
State and local governments, these increased costs would be 
passed through to the individual customers of these utilities.
    In fiscal year 1994, public utilities paid about $25 
million for power purchased from SEPA. Given our estimate that 
Federal power is priced 25 to 75 percent below non- Federal 
power sales in the region, public utilities could pay as much 
as $75 million more for this power after the sale of SEPA in 
fiscal year 1999. This cost increase could be reduced by a 
provision in the bill that would cap rate increases passed on 
to wholesale customers receiving more than 20 percent of their 
power supply from SEPA.
    Central Utah project prepayments.--This section would allow 
the Central Utah Water Conservancy District to prepay 
construction repayment contracts for the central Utah project. 
CBO estimates that the district would make prepayments of about 
$69 million in 1997, $129 million in 1998, and $33 million in 
2001. These repayments would be voluntary on the part of the 
district, and we assume it would choose to prepay only if it 
would benefit from doing so.
    Bonneville Power Administration debt refinancing.--BPA 
customers would pay more for power as a result of the increased 
debt service payments made by the agency to the Treasury. This 
rate increase would be partially offset, however, because BPA 
customers would no longer have to pay for part of the Federal 
Government's settlement with the Colville Tribe. We estimate 
that the net result of these changes would be increased costs 
for BPA's customers of $120 million over the next 7 years. 
Almost half of BPA power sales in fiscal year 1994 were to 
public utilities, so we estimate that payments by these 
utilities would increase by about $60 million over the 7-year 
period as a result of these provisions. This bill would also 
require BPA to include in its contracts for the sale of 
electricity a commitment not to assess any additional charges 
in the future to cover previously appropriated construction 
costs.
    Hardrock mining.--States would receive one-third of any 
receipts collected from the royalty imposed on hardrock 
minerals produced on certain Federal mining claims within their 
borders. CBO estimates that these payments to States would 
total about $0.2 million in 1996 and about $4.5 million over 
the 1996-2002 period.
    Hetch Hetchy Dam.--This provision would amend the 1913 act 
that granted the city of San Francisco the right to build and 
operate water and power facilities within the Yosemite National 
Park. This amendment would increase the required annual payment 
from the city to the Federal Government from $30,000 to $8 
million. In a year of normal rainfall, revenue earned by the 
city from the sale of water and power generated from these 
facilities may reach $25 million. This amount, however, has 
fallen to as low as $3 million in years of low rainfall, so the 
city may be forced to draw on other sources of revenue in some 
years to make the required payment to the Federal Government.
    In addition to the required $30,000 payment, the city 
voluntarily provides funds for a watershed protection program 
in Yosemite. It paid $944,200 for this program in the current 
fiscal year. The city could choose to reduce this payment if 
faced with higher mandatory payments.
    Grazing fees.--Under current law, States receive a portion 
of all Federal grazing fees collected within their borders. By 
increasing total receipts from grazing fees, this provision 
would increase payments to States in fiscal year 1996 by almost 
$1 million. For the 1996-2002 period, payments to States would 
increase by about $8 million compared to payments under current 
law.
    Ski fees and sale of ski areas.--These provisions would 
affect payments to States with Forest Service ski areas within 
their borders because States receive 25 percent of ski permit 
fee receipts. The net impact would be a loss of receipts to 
States of about $3 million over the next 7 years. In 
particular, CBO estimates that the sale of ski areas would lead 
to a reduction in permit fees paid to the States of about $1 
million over the 1996-2000 period. We estimate that the change 
in the formula used to assess fees would lead to a further 
reduction in these receipts of about $2 million over the next 7 
years, but a slight increase in later years.
    Export of Alaskan crude oil.--Analyses by DOE and industry 
sources have suggested that allowing exports of ANS crude oil 
could result in additional revenues for State and local 
governments in Alaska and California from higher royalties, tax 
receipts, and other sources. While we cannot estimate the total 
amount that would accrue to these States and localities as a 
result of this provision, we estimate that the States share of 
additional royalties from production on Federal lands would be 
about $2 million over the next 7 years. This represents only 
part of the potential increase in State and local revenues, 
however. State and local governments would also benefit to the 
extent that oil production on State and private lands is 
encouraged by this provision.
    Oil and gas royalties.--CBO estimates that the net impact 
of these provisions would be a $33 million increase in royalty 
income received by State governments over the next 7 years. 
States are affected by these changes because they share 50 
percent of the royalty income from oil and gas leased on 
Federal lands within their borders. Several of these changes 
would shift the collection of these royalties from future 
years. As a result, CBO estimates that the States share of 
royalty income would increase by about $40 million over the 
next 7 years. States would also share in the loss of royalty 
income from provisions requiring the Federal Government to pay 
interest on royalty overpayments. We estimate that the total 
impact of changes affecting interest paid on under- and 
overpayments of royalties would be a cost to the States of 
about $7 million over the same period.
    Sly Park Unit Conveyance Act.--This section would direct 
the Secretary of the Interior to convey certain facilities to 
the El Dorado Irrigation District in El Dorado County, CA. CBO 
estimates that this conveyance would only occur under terms and 
conditions that would not significantly change the district's 
annual payments to the Federal Government over the next 20 
years. Hence, for that period, sale under those conditions 
would have no budgetary impact.
    City of Folsom.--By designating the city of Folsom, CA, as 
a Central Valley project contractor as of November 1, 1990, the 
bill would allow the city to avoid a $25 per-acre-foot 
surcharge for water purchased from the Central Valley project.
    Sale of Alaska Power Administration.--The proposed 
purchasers of the APA would include the Alaska Energy 
Authority, a public corporation of the State of Alaska, and 
Anchorage Municipal Light and Power, which is owned by the 
municipality of Anchorage. Together with two nonprofit electric 
cooperatives, these utilities would purchase the facilities of 
the APA for $77 million under agreements negotiated in 1989. 
These purchasers have negotiated this sale on a voluntary 
basis. As noted earlier in this estimate, however, CBO does not 
consider the language in this bill sufficient to bring about 
this sale.
    8. Estimate comparison: None.
    9. Previous CBO estimate: None.
    10. Estimate prepared by: Federal cost estimates: Kim 
Cawley, Gary Brown, Victoria Heid, Kathleen Gramp, Deborah 
Reis, John R. Righter, Rachel Robertson, Richard Farmer, and 
Anne Hunt.
    State and local estimates: Marjorie Miller and Karen McVey.
    11. Estimate approved by: Robert A. Sunshine for Paul N. 
Van de Water, Assistant Director for Budget Analysis.

      ESTIMATED BUDGETARY IMPACT OF RECONCILIATION PROVISIONS APPROVED BY THE HOUSE COMMITTEE ON RESOURCES      
                  [Mandatory savings (-) and costs (+) by fiscal years, in millions of dollars]                 
----------------------------------------------------------------------------------------------------------------
                                                                                               5-year    7-year 
                                 1996     1997     1998     1999      2000     2001    2002     total     total 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                   ASSET SALES AND CHANGES TO DIRECT SPENDING                                   
                                                                                                                
----------------------------------------------------------------------------------------------------------------
Exports of Alaskan oil:                                                                                         
    Budget authority..........      -5       -7       -4        -3       -2        o       0       -21       -21
    Outlays...................      -5       -7       -4        -3       -2        0       0       -21       -21
Arctic National Wildlife                                                                                        
 Refuge:                                                                                                        
    Budget authority..........       0     -801        4         4     -420        5       5    -1,213    -1,203
    Outlays...................       0     -801        0         1     -497       12      42    -1,297    -1,243
Alaska PMA sale:                                                                                                
    Budget authority..........       0        0        0         0        0        0       0         0         0
    Outlays...................       0        0        0         0        0        0       0         0         0
Sale of helium reserves:                                                                                        
    Budget authority..........       0        0       -1         0        0        0       0        -1        -1
    Outlays...................       0       -8       -9        -9       -9       -9      -9       -35       -53
Sale of SEPA \2\:                                                                                               
    Budget authority..........       1        1        1     -1497      190      190     190    -1,304      -924
    Outlays...................       1        1        1    -1,497      190      190     190    -1.304      -924
Bonneville Power                                                                                                
 Administration refinancing:                                                                                    
    Budget authority..........     -16      -14      -15       -13      -12      -25     -25       -70      -120
    Outlays...................     -16      -14      -15       -13      -12      -25     -25       -70      -120
Central Utah prepayment:                                                                                        
    Budget authority..........       0      -67     -127         2        2      -31       2      -190      -219
    Outlays...................       0      -67     -127         2        2      -31       2      -190      -219
Sly Park:                                                                                                       
    Budget authority..........       0        0        0         0        0        0       0         0         0
    Outlays...................       0        0        0         0        0        0       0         0         0
Hetch Hetchy fees:                                                                                              
    Budget authority..........      -8       -8       -8        -8       -8       -8      -8       -40       -56
    Outlays...................      -8       -8       -8        -8       -8       -8      -8       -40       -56
Concession contracts at                                                                                         
 national parks:                                                                                                
    Budget authority..........       0        0       -5       -11      -16      -21     -27       -32       -80
    Outlays...................       0        0       -5       -11      -16      -21     -27       -32       -80
Ski area permit fees:                                                                                           
    Budget authority..........       2        2        2     (\1\)    (\1\)    (\1\)   (\1\)         6         6
    Outlays...................       2        2        2     (\1\)    (\1\)    (\1\)   (\1\)         6         6
Sale of ski areas:                                                                                              
    Budget authority..........       0        0       -2        -2      -11       -3      -3       -15       -21
    Outlays...................       0        0       -2        -2      -11       -3      -3       -15       -21
Livestock grazing fees:                                                                                         
    Budget authority..........      -2       -4       -4        -4       -4       -4      -4       -18       -26
    Outlays...................      -2       -4       -4        -4       -4       -4      -4       -18       -26
California land sale:                                                                                           
    Budget authority..........      -1        0        0         0        0        0       0        -1        -1
    Outlays...................      -1        0        0         0        0        0       0        -1        -1
Northern Mariana Islands:                                                                                       
    Budget authority..........     -28      -28      -28       -28      -28      -28     -28      -140      -196
    Outlays...................       0       -7      -14       -21      -28      -28     -28       -70      -126
Hardrock mining:                                                                                                
    Budget authority..........       3       15       16       -24      -24      -31     -31       -14       -76
    Outlays...................       3       15       16       -24      -24      -31     -31       -14       -76
Federal oil and gas royalties:                                                                                  
    Budget authority..........      15        9       10         7        9       14      17        50        81
    Outlays...................      15        9       10         7        9       14      17        50        81
Indian gaming:                                                                                                  
    Budget authority..........       0        0        0         0        0        0       0         0         0
    Outlays...................       0        0        0         0        0        0       0         0         0
Indian health \3\:                                                                                              
    Budget authority..........      56       61       68        78       94      113     136       357       606
    Outlays...................      56       59       65        75       89      107     129       344       580
                               ---------------------------------------------------------------------------------
      Total changes...........                                                                                  
          Budget authority....      17     -841      -93    -1,499     -230      171     224    -2,646    -2,251
          Outlays.............      45     -830      -94    -1,507     -321      163     245    -2,707    -2,299
----------------------------------------------------------------------------------------------------------------
\1\ Less than $500,000.                                                                                         
\2\ Provisions ordered reported by the House Transportation and Infrastructure Committee would prevent the sale 
  of SEPA.                                                                                                      
\3\ Includes estimates of additional Medicare costs only. Under current law, the changes that would be made by  
  this section to Medicaid would also result in additional costs. Relative to the changes that would be made to 
  Medicaid by the House Commerce Committee, however, these provisions would have no cost.                       

            Committee Oversight Findings and Recommendations

    With respect to the requirements of clause 2(l)(3) of rule 
XI of the Rules of the House of Representatives, and clause 
2(b)(1) of rule X of the Rules of the House of Representatives, 
the Committee on Resources' oversight findings and 
recommendations are reflected in the body of this report.

          Committee on Government Reform and Oversight Report

    With respect to the requirement of clause 2(l)(3)(D) of 
rule XI of the Rules of the House of Representatives, the 
committee has received no report of oversight findings and 
recommendations from the Committee on Government Reform and 
Oversight on the committee print adopted by the committee.
        TITLE X--COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                          House of Representatives,
            Committee on Transportation and Infrastructure,
                                  Washington, DC, October 11, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Mr. Chairman: Today, October 11, 1995, the Committee 
on Transportation and Infrastructure approved, by a recorded 
vote of 38-5, revised recommendations for budget 
reconciliation. This submission is to supercede and replace in 
full the previous reconciliation recommendations transmitted to 
you on September 29, 1995. The Committee's action today 
formally approved the language that ranking member Oberstar and 
I sent to you by letter on October 6. For your convenience, I 
am enclosing another copy of the legislative language and 
report.
    After I made the submission of September 29, the 
Congressional Budget Office [CBO] informed the committee that a 
provision relating to the sale of Union Station air rights 
would be scored at less than we had expected and that the 
committee would receive no credit for fiscal year 1996, leaving 
the Transportation and Infrastructure Committee short of 
reaching its fiscal year 1996 savings target. The committee 
strongly disagrees with this scoring since it is contrary to 
the views of the General Services Administration, both as to 
the valuation of the air rights and as to GSA's ability to 
complete the sale in fiscal year 1996.
    In order to fully comply, according to CBO, with each 
year's Reconciliation target, this supplemental submission adds 
language imposing fees on parking facilities provided at public 
buildings. Under the Rules of the House, the Transportation and 
Infrastructure Committee has jurisdiction over public buildings 
issues.
    According to a preliminary analysis by CBO, this additional 
provision will save at least $63 million in fiscal year 1996 
and $791 million over 7 years. Together with the provisions 
originally submitted on September 29, this will cause the 
Transportation and Infrastructure Committee to meet each year's 
target and to exceed its 7-year target by approximately $900 
million.
    With warm personal regards, I remain
            Sincerely,
                                               Bud Shuster,
                                                          Chairman.

                           table of contents

                                                                   Page
Transmittal letter...............................................   727
Purpose and summary..............................................   728
Hearings.........................................................   737
Discussion of committee bill--section-by-section analysis........   737
    Subtitle A--Water resources..................................   737
    Subtitle B--Ocean shipping reform............................   738
    Subtitle C--Midewin National Tallgrass Prairie...............   749
    Subtitle D--Miscellaneous....................................   750
    Subtitle E--Economic Development Administration and 
      Appalachian Regional Commission............................   751
Changes in existing law (Ramseyer)...............................   758
Summary of committee votes.......................................   863
CBO cost estimate................................................   865
Committee oversight findings.....................................   875
Oversight of Committee on Government Reform and Oversight........   875

                          Purpose and Summary

                 PURPOSE OF SUBTITLE A--WATER RESOURCES

Sec. 10001

    This provision would assure that existing concession 
agreements, licenses, and policies governing commercial 
activities at water resources projects of the Army Corps of 
Engineers are not modified as a result of provisions being 
considered elsewhere in the budget reconciliation. Part 1 of 
subtitle C of title IX, as reported by the Committee on 
Resources, would require new, standardized policies for 
commercial concessions on federally owned lands. The primary 
goals of this approach are laudable: to achieve standardized 
government-wide policies, to assure a fair return to the 
Federal Government for commercial activities on its lands, and 
to continue to provide a high quality visiting experience on 
Federal lands.
    The Corps of Engineers' commercial concession policies are 
among the soundest of any Federal agency having land management 
responsibilities. While the provisions of title IX will have 
the greatest impact on the programs of the Departments of the 
Interior and Agriculture, the committee is concerned that they 
will also have unintended, potentially disruptive effects on 
the commercial concession activities of the Corps.
    Reflecting the committee's concern, this section has been 
included to preclude the applicability of the provisions of 
title IX to corps commercial activities.

Sec. 10002

    This provision would assure that water resources projects 
of the Army Corps of Engineers continue to function as 
authorized by Congress and continue to provide multiple-purpose 
benefits to the Nation. The provision would preclude the sale 
of corps projects, facilities, and lands that is contemplated 
elsewhere in the budget reconciliation legislation. Part 1 of 
subtitle B of title IX, as reported by the Committee on 
Resources, directs the Secretary of Energy to sell the power 
assets of the Southeastern Power Administration [SEPA] through 
a competitive bidding process. The provision also requires the 
Secretary to sell any water resources projects of the Corps of 
Engineers--which is under the jurisdiction of the secretary of 
the Army--that provide hydroelectric power in the SEPA service 
area.
    The Corps of Engineers funds, builds, and operates water 
resources projects throughout the Nation. Some of these have 
been authorized by Congress, through legislation managed by 
this committee, to include hydroelectric power generating, or 
hydropower, facilities. Within the SEPA area there are 22 corps 
projects containing hydropower facilities. Such facilities were 
included only after thorough planning and design efforts by the 
corps to assure that their operation would not conflict with 
other authorized (and dominant) project purposes, such as flood 
control and navigation. Hydropower is not the primary purpose 
at corps projects; it is included as part of multipurpose 
projects.
    Under current law, power generated at these projects which 
is surplus to project needs is turned over to the Secretary of 
Energy for marketing through one of its five Power Marketing 
Administrations [PMA's]. The rates set by the PMA's under 
current law must allow for the payment of Federal 
appropriations spent annually by the corps to produce and 
transmit power and the repayment of the initial Federal 
investment over a 50-year period. Thus, while the Department of 
Energy's PMA's market the power generated at the projects, the 
projects themselves are within the programs of the Corps of 
Engineers.
    Any proposal to divest the Federal Government of corps 
projects or facilities at corps projects must take into account 
the consequences to all project purposes. While the major 
purposes are normally flood control and/or navigation, other 
purposes frequently are included in the project authorization 
or added subsequent to initial construction. Some of these 
include benefits for water supply, recreation, water quality, 
and fish and wildlife resources. It is impossible to separate 
hydropower operations and facilities from other project 
components without affecting the project's impact on other 
beneficial purposes. Similarly, one cannot change the operation 
of a multipurpose project to maximize hydropower benefits 
without causing significant, possibly catastrophic, impacts for 
the beneficiaries of other project components.
    Initiatives to separate a portion of a project's operation 
or facilities from that of the base project, or to change the 
thrust of the project, must be thoughtfully addressed by the 
committee having jurisdiction. To do otherwise would likely 
lead to unintended consequences, such as flooding of areas 
designed to be protected from flooding by the project; 
cessation of commercial navigation due to the failure of the 
project to maintain adequate water depths; and the disruption 
of municipal water supplies and water-based recreation 
resulting from altered or fluctuating reservoir levels.
    While the committee recognizes and appreciates the 
pressures all committees are under to generate meaningful 
savings, it strongly opposes any proposal that could result in 
the potential consequences addressed above. Major proposals 
such as this must be made only after a thorough, public review, 
should address hydropower facilities nationwide, and should 
address hydropower facilities of both the Bureau of Reclamation 
and the Corps of Engineers.
    The committee's provision assures that the problems 
addressed above will not occur by prohibiting the sale of Corps 
of Engineers projects or features of projects. The provision 
would provide, however, that initiatives to privatize the 
marketing of power that involve power generated at corps 
hydroelectric facilities, to the extent that such initiatives 
are authorized, are to be facilitated by the Secretary of the 
Army to the maximum practicable extent and consistent with 
authorized project purposes. The committee notes that under 
current operational conditions substantial hydroelectric power 
is generated at corps projects. For example, in fiscal year 
1990, corps statistics indicate that over 920 million MWH were 
generated at the 22 Corps hydropower projects in the SEPA area. 
The committee is of the opinion that its provision will not 
substantively affect the provision adopted by the Committee on 
Resources with respect to scoring for budget reconciliation 
purposes.

Sec. 10003

    This provision would authorize the Federal Emergency 
Management Agency [FEMA] to collect fees from licensees of 
commercial nuclear power plants to recover costs associated 
with the development of community radiological emergency 
response plans. In March of 1995, in response to a directive in 
the fiscal year 1993 VA-HUD Independent Agencies Appropriations 
Act, FEMA developed final regulations for the assessment and 
collection of such fees. The collection of fees has been 
directed on a year-by-year basis. The provision would make the 
authority permanent through fiscal year 2002.
    Under the provision, the fees to be established shall be 
fair and equitable and shall reflect the full amount of FEMA's 
costs of providing radiological emergency services. Such 
services include emergency planning, preparedness, response, 
and associated services.

            PURPOSE OF SUBTITLE B--OCEAN SHIPPING REFORM ACT

    The purpose of this subtitle, the Ocean Shipping Reform Act 
of 199, is to substantially deregulate the ocean shipping 
industry and eliminate the Federal Maritime Commission [FMC] by 
the end of fiscal year 1997. The committee believes that this 
subtitle will foster an international ocean transportation 
industry that is driven much more by the rigors of the 
marketplace rather than by governmental regulation.
    The Shipping Act of 1984 was enacted to respond to several 
major problems that existed at that time concerning ocean 
shipping practices. The 1984 act clarified the scope of 
antitrust immunity for ocean common carriers, maintained 
Government tariff filing and enforcement, established the right 
of independent action on conference filed tariffs, and allowed 
carriers or conferences to enter service contracts with 
shippers under certain conditions. As directed under section 18 
of the 1984 act, the Advisory Commission on Conferences on 
Ocean Shipping conducted a comprehensive study of conferences 
in ocean shipping, including nearly all relevant issues in the 
1984 act. The Advisory Commission issued its final report in 
April, 1992. The Advisory Commission members were chosen from a 
wide range of interests affected by ocean shipping from the 
private sector, the Congress, and the administration, and were 
unable to agree on any recommendations for changes to the 1984 
act. Although the 1984 act was labelled deregulatory, it 
maintained an ocean shipping regulatory system that has 
prevented true competition from existing in this important mode 
of transportation.
    In today's rapidly changing and expanding global trading 
economy, this lack of marketplace flexibility is unacceptable. 
U.S. businesses find themselves shackled to a system which does 
not permit normal business interactions and transactions that 
exist in virtually, every other sphere of the world's economy. 
Individual carriers and shippers cannot discuss the price and 
terms of shipping goods without being forced to share those 
discussions with competitors. The inhibiting effect of this 
situation on innovation and flexibility cannot be understated. 
Further, the benefits of true marketplace price competition 
cannot be realized.
    The bill amends the Shipping Act of 1984 (46 App. U.S.C. 
1708 et seq.) (1984 act) to:
    Ensure a mandatory right of independent action on ocean 
shipping contracts for all carriers operating within shipping 
conferences on January 1, 1997.
    The 1984 act established the right of independent action 
for conference members on any rate or service item agreed upon 
by the conference. The 1984 act did not extend this right to 
contracts, and allows conferences to prohibit conference 
members from signing individual contracts with shippers.
    The committee believes that this situation has frustrated 
the ability of carriers and their customers to form the close 
commercial ties that produce business efficiencies. Under this 
subtitle, conferences may not interfere in any way, directly or 
indirectly, with the right of individual conference members to 
sign ocean transportation contracts with the shippers of their 
choice. Also under this subtitle, the narrow ``service 
contract'' concept has been replaced with the broad definition 
of ``ocean transportation contract'' to include all types of 
contracts between carriers and shippers to provide services.
    Eliminate government tariff enforcement and regulation on 
January 1, 1997, and eliminate Government tariff and contract 
filing requirements on June 1, 1997.
    The 1984 act requires ocean common carriers to file their 
rates, or tariffs, with the FMC, and requires the FMC to 
enforce those rates. The 1984 act also requires the essential 
terms of service contracts to be filed with the FMC, and made 
available to similarly situated shippers.
    No other country has this type of tariff system, nor does 
any other country have government enforcement of rates. This 
type of regulatory system does not exist for other modes of 
transportation today. Finally, there are many exceptions to the 
existing tariff filing regime. For example, many commodities 
are exempt from the tariff filing requirement in the 1984 act. 
Also, for cargo shipped through a Canadian or Mexican port, 
there is no public tariff filing or enforcement requirement. 
Today, carriers and shippers can do business successfully in 
foreign-to-foreign trades where government tariff filing does 
not exist.
    It is the committee's experience that with other 
transportation modes that carriers and shippers do business 
more effectively with less government regulation of 
transportation rates. In fact, American exporters are currently 
at a disadvantage because their transportation costs are 
public, where their foreign competitors' costs are not made 
public. Elimination of tariff filing and enforcement will allow 
closer and more satisfactory relationships between shippers and 
carriers, to the benefit of the American consumer.
    Provide authority for shippers and carriers to agree to 
completely confidential service contracts, beginning on January 
1, 1998.
    This subtitle allows carriers and shippers to freely 
negotiate transportation contracts and maintain the 
confidentiality of the terms of those contracts. Confidential 
business terms are allowed in every other transportation 
sector, as well as virtually every other sector of the world 
economy, with benefits accruing to the parties to the contract 
and to the ultimate consumer of goods transported. Confidential 
contracts are currently used in many foreign-to-foreign trades 
with beneficial results.
    The committee rejects the argument that confidential, 
secret contracts will work to the disadvantage of small 
shippers. Today, small shippers have no advantages over large 
shippers, because the only distinguishing factor allowed under 
the current ocean transportation system is volume. Under the 
ocean shipping regime provided in this bill, small shippers 
will have more flexibility to bargain for attractive shipping 
contract terms, because volume will not be the only important 
factor in the ocean shipping system. Shippers generally will 
have the freedom to bargain for the best prices possible, 
without conference interference.
    Retain current system of oversight and filing requirements 
for carrier conference agreements under the 1984 act.
    This subtitle does not disturb the exemption from the 
antitrust laws that currently exists under the Shipping Act of 
1984. The bill also preserves the 1984 act system of filing of 
carrier agreements and Government oversight over those 
agreements.
    This subtitle provides for an orderly transition to a more 
market-based system that will better serve the interests of 
consumers, shippers, and ocean carriers. The subtitle allows 
the current system of ocean carrier conferences to continue. 
These conferences presently enjoy a broad grant of immunity 
from the antitrust laws of the United States, and that grant of 
immunity is unaffected by this bill. These conferences meet, 
discuss, and frequently determine what the price of shipping 
particular goods between specific points will be. While this 
approach is counter to the usual approach the United States has 
taken toward concerted economic activity, it has been the legal 
and policy approach of the United States for nearly 100 years. 
Discarding it overnight would be detrimental to all U.S. 
interests. The bill provides very significant reforms to ocean 
shipping, but preserves much of the existing conference 
structure while the reforms provided by this bill are phased in 
and take root over the next several years.
    While conferences will continue to discuss and set shipping 
prices, this subtitle removes significant business activity 
from their control, enabling carriers, shippers, and others to 
enter into flexible, innovative, and competitive arrangements 
to ship goods. Carriers and shippers will be able to enter into 
ocean transportation contracts with each other without 
hindrance or oversight from a conference.
    The expectation is that over time, carrier/shipper business 
relations will be increasingly governed by contracts negotiated 
outside of the conference system. Again, the purpose is to 
permit opportunities for flexibility, innovation, and price 
competition to flourish. For those business people comfortable 
with the features of the existing common carrier system, it 
will continue to exist and be available.
    The exemption from the U.S. antitrust laws for ocean 
carriers has existed since 1916, and is the policy of our 
international trading partners. Unilateral action by the United 
States to revoke antitrust immunity would disrupt international 
trading conditions and unfairly disadvantage U.S. carriers. It 
will also discourage investment in U.S.-flag shipping. Another 
important reason to maintain the current scope of antitrust 
immunity for carriers in trade with the United States is the 
concern that the antitrust laws would not be uniformly 
enforced, and that U.S. carriers would be unfairly targeted for 
antitrust prosecution because of the difficulty of enforcing 
the antitrust laws abroad.
    The committee supports the current exemption from the 
antitrust laws under the 1984 act, but is concerned that 
certain concerted behavior on the part of ocean conferences has 
abused the grant of immunity under the 1984 act. The antitrust 
exemption is intended to allow carriers and conferences to 
cooperate in efficiency enhancing practices. The exemption is 
not intended to endorse anticompetitive practices on the part 
of conferences. The conference that operates in the North 
Atlantic trade, know as the Trans-Atlantic Conference 
Agreement, has engaged in practices that have been criticized 
as anti competitive. The committee believes that the amendments 
made by this bill weaken the concerted ratemaking authority of 
conferences, and discourage future anticompetitive behavior on 
the part of conferences. The ocean shipping system established 
under this bill preserves the status quo concerning antitrust 
immunity, and is intended to allow ocean carriers to address 
their common concerns and within the agreement oversight 
structure of the 1984 act.
    Strengthen laws related to unfair trade practices of 
foreign carriers and foreign governments.
    This subtitle contains new tools to address the potential 
of unreasonable, predatory, or anticompetitive pricing behavior 
in the new, more competitive system of ocean shipping 
established under this bill.
    Transfer the remaining responsibilities of the Federal 
Maritime Commission to the Secretary of Transportation, between 
October 1, 1995, and October 1, 1997, and eliminate the FMC as 
an independent agency, by the end of fiscal year 1997.
    The primary responsibility of the FMC is to administer the 
Shipping Act of 1984. This subtitle repeals the most 
significant regulatory functions of the 1984 act, including 
tariff filing and enforcement. The committee believes that the 
residual functions of the Federal Maritime Commission are most 
appropriately consolidated within the Department of 
Transportation.
    The subtitle will eliminate the Government from the 
business of being the repository and the enforcer of the prices 
set by the carrier conferences. Presently, prices, or tariffs, 
are filed with the FMC and if a carrier or shipper deviates 
from that filed tariff, they are subject to FMC enforcement 
action. This is an outmoded approach toward the regulation of 
transportation that neither fits with nor benefits the 
contemporary business climate and marketplace. Under chapter 3 
of this subtitle, the FMC will be abolished on October 1, 1997. 
Its residual functions will be inherited by the Secretary of 
Transportation.
    Consumers of other modes of transportation such as air 
passenger, air cargo, and trucking have been largely free of 
Government involvement in pricing for a number of years. The 
result in these modes has been more choices and better prices 
for the consumer. Some might argue that it is also more chaotic 
and less predictable, but it is the committee's experience that 
the American consumer accepts more pricing uncertainty--when it 
also results in lower consumer prices. By eliminating tariff 
filing with the FMC and eventually the FMC itself, the shipping 
public and the carriers will have removed a major impediment to 
pricing, service competition, and innovation.
    The changes embodied in this bill are required for U.S. 
businesses and U.S. carriers to compete effectively in the 
world economy. Increasingly, if businesses and their employees 
are to succeed and prosper, they must be nimble in order to 
anticipate or respond to global business opportunities. The 
current ocean shipping regime under the 1984 act stifles the 
innovative spirit of American business people. This subtitle 
creates opportunities for American importers and exporters and 
will allow them to compete for a greater share of international 
business.
    Finally, this subtitle is strongly supported by U.S. ocean 
carriers, the U.S. shipping community, as well as the Clinton 
administration. It represents a well balanced approach to the 
future of ocean shipping regulation.

       PURPOSE OF SUBTITLE C--MIDEWIN NATIONAL TALLGRASS PRAIRIE

    This subtitle incorporates the provisions of H.R. 714, the 
Illinois Land Conservation Act of 1995. H.R. 714, which would 
establish the Midewin National Tallgrass Prairie [MNP] in 
northeast Illinois, was approved by the Committee on 
Transportation and Infrastructure on June 14, 1995, and was 
passed in substantially the same form by the House of 
Representatives on July 31, 1995.
    The purpose of the Illinois Land Conservation Act of 1995 
is to provide for the orderly conversion of lands at the Joliet 
Army Ammunition Plant (``Joliet Arsenal'') to the Midewin 
National Tallgrass Prairie [MNP] and other non-defense 
purposes. The total acreage involved is 23,500 acres--36.7 
square miles. Of this amount, 3,000 acres would be transferred 
to the State of Illinois for use in economic redevelopment; 982 
acres would be transferred to the Department of Veterans 
Affairs for use as a national cemetery; 455 acres would be 
transferred to Will County, Illinois for use as a landfill; and 
the remaining acreage would be transferred to the Department of 
Agriculture for management as the MNP. The Department of the 
Army would retain responsibility for environmental restoration 
of arsenal properties, including the cleanup of sites under the 
Comprehensive Environmental Response, Compensation, and 
Liability Act of 1980 (``Superfund'').
    In April of 1993, the Department of the Army announced the 
closing of the Joliet Arsenal, located in northeast Illinois, 
about 40 miles southwest of Chicago. The Joliet Arsenal was the 
Army's leading producer of munitions during World War II and 
was reactivated during the Korean and Vietnam conflicts; 
however, the Army determined that the arsenal is no longer 
required for use by the military.
    Also in 1993, then-Congressman George Sangmeister formed 
the Joliet Arsenal Citizen Planning Commission to develop 
recommendations for use of arsenal lands. This action was taken 
based on the recognized opportunity to achieve multiuse 
benefits with arsenal lands. The Commission consisted of 
representatives from local, State and Federal agencies, local 
school districts and conservation groups, and the business 
community. The Commission developed a consensus plan in April 
of 1994 and revised its recommendations on May 30, 1995. This 
plan is reflected in the Proposed Future Land Use map provided 
to the Committee on Transportation and Infrastructure in June 
of 1995.
    This subtitle would ratify in principle the proposals 
generally identified on the land use map and would result in 
resumed beneficial use of arsenal lands. The plan has four 
basic goals: First, reestablish prairie habitat for wildlife, 
recreational and educational purposes, through creation of the 
Midewin National Tallgrass Prairie [MNP]; second, create a 
national cemetery to satisfy the need for such a facility in 
the region; third, establish an area for economic redevelopment 
to partially compensate for lost economic activity due to the 
arsenal's closure; and fourth, establish a landfill for use by 
Will County and for use in the disposition of nonhazardous 
materials resulting from the Army's cleanup activity at the 
arsenal. These goals will be achieved without reducing the 
Army's responsibility for any environmental cleanup work that 
is required under existing law.

                  PURPOSE OF SUBTITLE D--MISCELLANEOUS

Sec. 10401

    This provision maintains the current level of vessel 
tonnage duties through fiscal year 2002.
    The United States imposes a tonnage duty on a vessel which 
enters the United States from any port or place. The duty is 
also imposed on a vessel which departs from and returns to a 
U.S. port or place on a ``voyage to nowhere''.
    The tonnage duty is imposed on the cargo-carrying capacity 
of the vessel and is assessed regardless of whether the vessel 
is empty or is carrying cargo.
    A vessel arriving from a foreign port in the northern 
Western Hemisphere--Canada Mexico, Central America, West 
Indies, Bahamas, Bermuda, and northern South America--and a 
vessel returning from a ``voyage to nowhere'' must pay a 
tonnage duty of 9 cents per ton. However, the maximum payment 
for any vessel in a single year is 45 cents per ton.
    A vessel arriving from a foreign port anywhere else in the 
world must pay a tonnage duty of 27 cents per ton, not to 
exceed $1.35 per ton in a single year.
    Under current law, after fiscal year 1998, the tonnage 
duties will revert to earlier, lesser amounts--2 cents per ton, 
not to exceed 10 cents per ton in a single year for vessels 
entering from the northern Western Hemisphere and from 
``voyages to nowhere--6 cents per ton, not to exceed 30 cents 
per ton for other vessels subject to the duty.

Sec. 10402

    This section requires the Administrator of the General 
Services Administration to sell Governors Island, NY, at fair 
market value. The section waives all provisions of the Federal 
Property and Administrative Services Act, as amended, and gives 
the State of New York and the city of New York a right of first 
refusal to purchase the property. The proceeds of the sale will 
be deposited in the miscellaneous account of the U.S. Treasury.
    Governors Island is located in New York harbor, south of 
Manhattan and west of Brooklyn. It houses the largest Coast 
Guard facility in the world, Support Center New York, which 
provides support for commands stationed on the island. The 172-
acre island is surrounded by a seawall and is reached by ferry 
from Manhattan.
    The Coast Guard must reduce its operating costs by $400 
million over the next 4 years. To reach that goal, the Coast 
Guard has developed a streamlining plan that includes a closure 
and relocation of the Coast Guard facilities on Governors 
Island.
    The Coast Guard estimates that it will require 2 years to 
move Coast Guard facilities from Governors Island to new 
locations.

Sec. 10403

    The Administrator of General Services is authorized and 
directed to sell, before the end of fiscal year 1996, at fair 
market value, the air rights north of Union Station, 
Washington, DC. There are approximately 16.3 acres of air 
rights, or air space above train tracks that could be developed 
into commercial property, with parking. As recently as 1992 
these air rights were valued by an appraisal performed for GSA 
at $50,000,000. This figure is net of any cost to build a 
platform, or lid, which is necessary to support the development 
of a building.
    These air rights are bounded on the south by Union Station, 
on the east by the CSX property and Second St. NE., on the 
north by K St. NE. and on the west by 1st St. NE. H St. NE. 
overpass cuts through the air rights, running east-west. These 
air rights are currently owned by the Department of 
Transportation, and AMTRAK. An amendment adopted in committee 
would require AMTRAK to transfer, at no cost, its air rights, 
estimated to be approximately 10.6 acres, to the Department of 
Transportation. The Administrator of General Services would 
then sell the air rights in a manner to be determined.

    PURPOSE OF SUBTITLE E--ECONOMIC DEVELOPMENT ADMINISTRATION AND 
                    APPALACHIAN REGIONAL COMMISSION

    An amendment was adopted in committee that substantially 
consisted of the text of H.R. 2145, the Economic Development 
Partnership Act of 1995. Nearly identical language was adopted 
by the committee on September 14, 1995, in full committee 
markup of H.R. 1756, a bill to eliminate the Department of 
Commerce. The final language to included as part of the 
Commerce elimination portion of reconciliation will be 
determined in consultation with the Government Reform and 
Oversight Committee.

                                Hearings

    The Committee on Transportation and Infrastructure's 
Subcommittee on Railroads held a hearing on September 14, 1995, 
to evaluate the administration's proposed extension and 
expansion of Federal rail safety user fees; the fees expire 
under current law on September 30, 1995. The fees, which are 
deposited in the general Treasury accounts, offset most of the 
safety activities of the Federal Railroad Administration.
    A key condition to enactment of the original fee 
legislation in 1990 was a proviso [49 U.S.C. 20115(d)] that the 
Secretary of Transportation was to report within 90 days after 
the close of each fiscal year, the amount of fees collected, 
the impact of the fees on the financial health and competitive 
position of the rail industry, and the total cost of other 
federal safety activities for competing modes of 
transportation, including the portion of such activities 
defrayed by user fees. If the Secretary found in such an annual 
report either an adverse financial or competitive impact on the 
industry, or a significant difference in the burden of federal 
user fees between the rail industry and competing modes of 
transportation, he was required to submit corrective 
legislation within 180 days after the close of the fiscal year.
    The following is the DOT/FRA record in complying with the 
foregoing impact evaluation reporting requirements:

------------------------------------------------------------------------
 Reporting period submission        Due date               Actual       
------------------------------------------------------------------------
Fiscal year 1991............  Dec. 31, 1991.......  September 1992.     
Fiscal year 1992............  Dec. 31, 1992.......  March 1993.         
Fiscal year 1993............  Dec. 31, 1993.......  November 1994.      
Fiscal year 1994............  Dec. 31, 1994.......  Not yet submitted.  
------------------------------------------------------------------------

     Testimony was received from the Federal Railroad 
Administration, the Association of American Railroads, the 
Regional Railroads of America, the American Short Line Railroad 
Association, and the American Public Transit Association. The 
Administration supported renewal and expansion of the fees and 
the dropping of the annual impact evaluation reporting 
requirement as ``not serving a useful purpose.'' All other 
witnesses opposed renewal of the fees because of their 
discriminatory and unfair competitive impact on railroads 
compared with other modes of transportation. Small railroads in 
particular contended that the user fees amount to a substantial 
increase in their federal tax burden, and often mean the 
difference between profit and loss.

                      Section-by-Section Analysis

                      SUBTITLE A--WATER RESOURCES

Sec. 10001. Commercial concessions at Corps of Engineers projects

    This section assures that existing concession policies for 
commercial activities at Corps of Engineers projects are 
maintained.

Sec. 10002. Prohibition on sale of Corps of Engineers projects

    This section precludes the sale of Corps of Engineers 
projects, facilities and lands that might otherwise be required 
to allow the privatization of power marketing. The amendment 
would also provide that initiatives to privatize the marketing 
of power that involve power generated at Corps hydroelectric 
facilities be facilitated by the Secretary of the Army to the 
maximum practicable extent.

Sec. 10003. FEMA radiological emergency preparedness fees

    This section authorizes the Federal Emergency Management 
Agency [FEMA] to collect fees from licensees of commercial 
nuclear power plants to recover costs associated with the 
development of community radiological emergency response plans. 
The collection of fees has been directed on a year-by-year 
basis. This section makes the authority permanent through 
fiscal year 2002.

                   SUBTITLE B--OCEAN SHIPPING REFORM

Sec. 10201. Short title

    This section states that this subtitle may be cited as the 
``Ocean Shipping Reform Act of 1995.''

                    Chapter 1--Ocean Shipping Reform

Sec. 10211. Purposes

    Section 10211 of this subtitle amends section 2 of the 
Shipping Act of 1984 (1984 Act) (46 App. U.S.C. 1701) to add an 
additional purpose to the 1984 act. This purpose, ``to permit 
carriers and shippers to develop transportation arrangements to 
meet their specific needs'', is added to emphasize that the 
amendments made by this bill are intended to give ocean 
carriers and shippers the flexibility and the freedom to choose 
the most desirable business arrangements for transportation of 
goods in the U.S. foreign commerce, without restrictions 
imposed by ocean shipping conferences.

Sec. 10212. Definitions

    Section 10212 of this subtitle amends section 3 of the 1984 
act related to definitions.
    Paragraph 1 of this section, effective on January 1, 1997, 
amends section 3 of the 1984 act by striking paragraph (9), 
which contains the definition of ``deferred rebate''. Paragraph 
2 of this section, effective on June 1, 1997, amends section 3 
of the 1984 act by striking paragraphs (4), containing the 
definition of (``bulk cargo''), (10) (``forest products''), 
(13) (``loyalty contract''), (16) (``non vessel operating 
common carrier''), and (21) (``service contract''). The 
definitions stricken under this section are no longer necessary 
or relevant under the amendments to the 1984 act made by this 
subtitle.
    Paragraph 2(B) of this section amends paragraph (7) of 
section 3 of the 1984 act, containing the definition of 
``conference''. This amendment, effective on the date tariff 
filing is abolished, June 1, 1997, substitutes ``a common 
schedule of transportation rates, charges, classifications, 
rules, and practices'' in place of a ``common tariff''. This 
amendment is a technical clarification of conference operations 
after the repeal of tariff filing under this subtitle.
    Paragraph 2(F) of this section amends paragraph (18) of 
section 3 of the 1984 act, containing the definition of ``ocean 
freight forwarder''. This amendment consolidates the 
definitions of ``ocean freight forwarder'' and ``non-vessel-
operating common carrier'' into a new definition of ``freight 
forwarder'' for the purposes of the amendments made by this 
subtitle.
    Paragraph 2(H) of section 102 of this bill amends paragraph 
(23) of section 3 of the 1984 act concerning the definition of 
the term ``shipper'' to include ``a shippers' association, or 
an ocean freight forwarder that accepts responsibility for 
payment of the ocean freight''. This amendment is intended to 
place shippers' associations and ocean freight forwarders on a 
equal footing as to eligibility to enter ocean transportation 
contracts with ocean carriers under the amendments made by this 
subtitle.
    Paragraph 2(I) of this section contains a technical 
amendment to the definition of ``shippers' association'' to 
substitute ``ocean transportation contracts'' in place of 
``service contracts''.
    Paragraph 2(J) of section 102 of this subtitle adds a 
definition of a new term ``ocean transportation contract''. An 
``ocean transportation contract'' is defined as ``a contract in 
writing separate from the bill of lading or receipt between one 
or more common carriers or a conference and one or more 
shippers to provide specified services under specified rates 
and conditions.'' The committee intends that the definition of 
ocean transportation contract be interpreted broadly, to 
include all types of transportation arrangements that may be 
agreed to between shippers and carriers. Unlike the definition 
of ``service contract'', which was repealed by paragraph 2(G) 
of this section, an ``ocean transportation contract'' is 
intended to encompass transportation agreements, regardless of 
their costs, duration, service commitments, geographic scope, 
or other term or condition. The definition of ``ocean 
transportation contract'' allows carriers to enter joint 
contracts and conference contracts, including contracts in 
which a group of carriers, either operating as a conference, 
within a conference, or otherwise, join together and enter into 
a contract with a shipper or shippers.

Sec. 10213. Agreements within the scope of the act

    Sec. 10213 of this subtitle amends section 4(a)(5) of the 
1984 act (46 app. U.S.C. 1703(a)), effective on June 1, 1997, 
to reflect consolidation of non-vessel-operating common 
carriers and freight forwarders under this subtitle.
    Paragraph 2 of section 10213 of this subtitle amends 
section 4(a)(7) of the 1984 act to eliminate agreements by or 
among ocean common carriers to regulate or prohibit their use 
of service contracts from the scope of the 1984 act or the 
amendments made by this subtitle, and include within the scope 
agreements to discuss matters related to ocean transportation 
contracts, and agreements to enter into ocean transportation 
contracts and other agreements related to those contracts.
    The amendment is made to clarify that the amendments to the 
1984 act made by this subtitle remove the ability of 
conferences to prohibit the members of the conference from 
negotiating or entering individual ocean transportation 
contracts and from imposing mandatory guidelines or 
requirements on the negotiations or content of ocean 
transportation contracts entered into by individual conference 
members.
    The committee intends that the amendments made by this 
subtitle to sections 5 and 8 of the act, adding prohibitions on 
activities by a conference to regulate or prohibit contracting 
by its individual members, are not expressly or impliedly 
overridden by section 4(a) of the 1984 act. Further, in 
adopting the language in new section 4(a)(7), the committee 
does not intend to confer any authority upon conferences to 
enter binding agreements or engage in conduct prohibited by 
sections 5(b) (9) and (10) and section 8(b). The new language 
in section 4(a)(7) simply defines activities that are within 
the scope of antitrust immunity provided to ocean carriers 
under the act and is not intended to override or conflict with 
the new prohibitions and requirement contained in sections 5(b) 
(9) and (10) and section 8(b) imposed upon conferences 
concerning contracting by individual conference members. The 
committee also does not intend that agreements by carriers or 
conferences involving contracts are, under any amendment made 
by this bill, subject in any way to the antitrust laws. Ocean 
carrier agreements or guidelines involving contracts, including 
decisions to enter into or decline to enter into joint 
contracts, will continue to be within the scope of, and subject 
to the requirements of the 1984 act, and not the antitrust 
laws, to the same extent as under current law.
    Claims that a conference is improperly restricting or 
prohibiting contracting activity are to be addressed under the 
1984 act and not the antitrust laws.

Sec. 10214. Agreements

    Section 10214 of this subtitle amends section 5 of the 1984 
act (46 App. U.S.C. 1704), to impose certain requirements on 
conference agreements to ensure that shippers and carriers have 
unrestricted freedom to enter into ocean shipping arrangements. 
Paragraph (1) of section 104 of this subtitle, effective on 
January 1, 1997, amends section 5(b)(4) of the 1984 act to 
amend the requirement for conference agreements concerning 
policing of conference agreements. Paragraph (1) of this 
section also adds a new paragraph (9) to section 5(b) of the 
1984 act requiring each conference agreement to provide that a 
member of the conference may enter into individual and 
independent negotiations and may conclude individual and 
independent service contracts under section 8 (as amended) of 
the act. Before June 1, 1997, the essential terms of those 
service contracts must continue to be filed with the Federal 
Maritime Commission.
    Paragraph (2) of section 10214 of this subtitle, effective 
on June 1, 1997, further amends sections 5 (b) and (e) of the 
1984 act. Paragraph (2)(A) of section 10214 amends subsection 
(b)(8) of the 1984 act to require each conference agreement to 
provide that any member of the conference may take 
``independent action'' on any conference rate or service item 
for transportation provided under section 8(a) of the 1984 act 
upon not more than 3 business days notice to the conference. 
This amendment lowers the notice requirement for ``IAs'' from 
10 calendar days to 3 business days, and will reduce the 
opportunity for conferences to deter or interfere with their 
members' desires to deviate from conference rates.
    Paragraph 2(B) of section 10214 amends new subsection 
(b)(9) to reflect the transition from service contracts to 
ocean transportation contracts, effective on June 1, 1997.
    Paragraph 2(C) of section 10214 adds a new paragraph (10) 
to section 5(b) of the 1984 act that requires each conference 
agreement to prohibit the conference from: (A) prohibiting or 
restricting the conference members from engaging in 
negotiations for ocean transportation contracts; and (B) 
issuing mandatory rules or requirements affecting ocean 
transportation contracts.
    The prohibitions of section 5(b)(10) are applicable to 
mandatory guidelines enforceable by the conference. They do not 
extend to voluntary guidelines or agreements among conference 
members concerning their use of ocean transportation contracts, 
or to discussion of such guidelines within the conference. Such 
voluntary guidelines are similarly not precluded by sections 
5(b)(10)(A) or 8(b)(4) of the act. Thus, for example, a 
conference may discuss and agree upon voluntary guidelines 
concerning matters such as contract cycles, currency and 
adjustment factors, bunker surcharges and other rates and 
charges. However, adoption of voluntary guidelines or 
agreements among conference members concerning ocean 
transportation contracts shall not bind or impose any 
obligations or requirements on any individual conference 
member. Thus, a member line could not be prevented, penalized, 
or otherwise disciplined by the conference if it chooses to 
deviate from these guidelines and enter a contract that differs 
from these guidelines.
    The committee notes that sections 5(b) (9) and (10) refer 
to ``individual'' or ``independent'' negotiations and 
contracts. These references are not intended to suggest that 
joint contracts are impermissible.
    Paragraph 2(D) is a technical amendment to section 5(e) of 
the 1984 act to reflect the elimination of the requirement to 
file tariffs with the Federal Maritime Commission, effective on 
June 1, 1997.
    Other than conforming changes to reflect the transfer of 
functions from the Federal Maritime Commission to the Secretary 
of Transportation, this subtitle does not alter current 
standards and procedures governing the filing, approval, and 
oversight of agreements entered by ocean carriers under section 
4 of the 1984 act. Current agreement filing and review 
procedures and standards, including existing standards and 
practice under sections 5 and 6 of the act, will be retained in 
full. The legislative history as to agreement filing and 
approval that accompanied the 1984 act remains authoritative in 
the construction of the 1984 act as amended by this subtitle, 
including in particular the discussion of sections 6 (g) and 
(h) included in the Joint Explanatory Statement of the 
Committee of Conference for the 1984 act. (See H. Conf. Rep. 
No. 600, 98th Cong., 2d Sess. 31-37.) The Secretary of 
Transportation, however, will now be responsible for 
administering the standards and requirements contained in 
sections 6 (g) and (h).
    Under the 1984 act, no private person may bring an action 
under section 6(g) to challenge an agreement as being 
substantially anticompetitive since that authority is only 
provided to the administering body of the 1984 act, now the 
Secretary of Transportation. The committee notes that this 
limitation on private causes of action requires the Secretary 
of Transportation to review, monitor, and enforce agreements 
entered under section 4 of the act to ensure that shippers and 
other purchasers of ocean transportation services are 
adequately protected from agreements that engage in conduct 
that falls within the standard of section 6(g). Further, any 
commercial party which deals with agreements entered under 
section 4 of the 1984 act should be provided with a means for 
submitting information to the Secretary in the event that they 
experience problems or harm resulting from substantially 
anticompetitive conduct on the party of an agreement.

Sec. 10215. Exemption From the Antitrust Laws

    Section 10215 of this bill amends section 7 of the 1984 act 
(46 App. U.S.C. 1706), to clarify the exemption from the 
antitrust laws for agreements, modifications, or cancellations 
in effect before the effective date of this act and for 
tariffs, rates, fares, charges, classifications, rules, or 
regulations implementing the agreements, modifications, or 
cancellations. Section 105 also amends section 7(e) of the 1984 
act to include ``department'' along with ``agency or court'' as 
potential decision-makers regarding the grant of antitrust 
immunity under this act, in preparation for the transfer of 
conference oversight responsibilities under this subtitle to 
the Secretary of Transportation.
    The scope of antitrust immunity conferred by section 7 of 
the 1984 act, in conjunction with sections 4 and 5 of the 1984 
act, is retained under this subtitle.

Sec. 10216. Common and contract carriage

    Section 10216 of this subtitle repeals section 502 of the 
High Seas Driftnet Fisheries Enforcement Act (46 App. U.S.C. 
1707a) related to the Federal Maritime Commission's automated 
tariff filing and information system, effective on June 1, 
1997. Also effective on June 1, 1997, section 10216 amends 
section 8 of the 1984 act (46 App. U.S.C. 1707) to abolish the 
requirement to file tariffs and essential terms of service 
contracts with the Federal Maritime Commission, and to replace 
that system with a more flexible and responsive regime for 
ocean transportation.
    This amendment does not preclude carriers, conferences, or 
others from using, publishing, and adhering to private, unfiled 
schedules of transportation rates, charges, classifications, 
rules and practices, after the current statutory requirements 
concerning Government tariff filing and enforcement are 
eliminated. For example, removal of the express reference to 
tariffs in the definition of a ``conference'' under the 
amendments contained in this subtitle is a conforming change 
and does not work any substantive change in statutory or 
regulatory treatment of conferences under the 1984 act or the 
amendments made by this subtitle, or their ability to agree on 
matters currently set forth in tariffs. Thus, as a part of its 
collective ratemaking activity, a conference would still be 
permitted to utilize a common schedule of transportation rates 
which may include rates, charges, rules, ocean freight 
forwarder compensation, and other noncontract terms governing 
the ocean and intermodal transportation rates a ``tariff.'' 
However, despite any use of the term ``tariff,'' the ``files 
rate doctrine'' under the 1984 act is no longer applicable. 
Paragraph (2) of section 10216 of this bill replaces section 8 
of the 1984 act related to tariffs with a new section 8 that 
requires common carriers or conferences to make their schedule 
of rates for transportation services available in writing to 
any person upon request. Subsections (a)(2) and (a)(3) of new 
section 8 require disputes between a common carrier or 
conference and a person concerning certain items related to 
transportation services under subsection (a)(1), and claims 
concerning a rate for ocean transportation services which 
involves false billing, false classification, false weighing, 
false report of weight, or false measurement, to be decided in 
an appropriate State or Federal court of competent 
jurisdiction, unless the parties otherwise agree.
    Subsection (b) of new section 8 contains the authority for 
one or more common carriers or a conference to enter into an 
ocean transportation contract with one or more shippers. Under 
this subsection, an ocean common carrier may enter into ocean 
transportation contracts without limitations concerning the 
number of contracts or the amount of cargo or space involved. 
The committee intends that this authority allow common carriers 
and shippers to enter into whatever ocean transportation 
contracts that meet the needs of their companies, without 
restrictions on the terms or conditions of the contracts, and 
without restrictions or interference by conferences.
    New subsection 8(b)(2) provides that a party to an ocean 
transportation contract shall have no duty in connection with 
services provided under the contract other than the duties 
specified by the terms of the contract. This provision is 
based, in part, on a similar contracting provision applicable 
to railroads, contained in the Staggers Rail Act of 1980. The 
provision is intended to ensure that ocean transportation 
contracts are treated as any other contract entered between two 
business parties regardless of the subject matter of the 
contract. Section 8(b)(2) serves to emphasize that the agreed 
upon terms of an ocean transportation contract shall govern the 
conduct of the parties to the contract and that the terms of 
the contract shall be enforced by the courts under the general 
principles of common law contracts.
    New subsection 8(b)(3)(A) provides that an ocean 
transportation contract or the transportation provided under 
that contract may not be challenged in any court on the grounds 
that the contract violated a provision of this subtitle. New 
subsection 8(b)(3)(B) provides that the exclusive remedy for an 
alleged breach of an ocean transportation contract is an action 
in an appropriate State or Federal court of competent 
jurisdiction, unless the parties otherwise agree.
    New subsection 8(b)(4) clarifies that the requirements and 
prohibitions concerning contracting by conferences contained in 
sections 5(b) (9) and (10) of this subtitle shall also apply to 
any agreement among one or more ocean common carriers that is 
filed under section 5(a) of this subtitle.
    Subsection (b) of section 10216 of this subtitle adds a new 
paragraph (5) to amended section 8(b) of the 1984 Act to allow 
carriers and shippers to agree to make ocean transportation 
contracts on a confidential basis, effective on January 1, 
1998. Under paragraph (5), an ocean common carrier that is a 
member of a conference agreement may not be prohibited or 
restricted by the conference from agreeing that the parties to 
the contract will not disclose any matter related to the ocean 
transportation contract to any person or entity, including any 
member of the agreement, the conference, any other carrier, 
shipper, or conference, or any other third party. The only 
exception to this confidentiality requirement is contained in 
new section 5(b)(10), which allows a conference to require a 
member of a conference to disclose the existence of an 
individual ocean transportation contract, but none of the terms 
or conditions contained in the contract, when the conference 
enters negotiations on an ocean transportation contract with 
the same shipper.

Sec. 10217. Prohibited acts

    Section 10217 of this bill amends section 10 of the 1984 
act (46 App. U.S.C. 1709) to repeal certain paragraphs of 
section 10 that are no longer necessary or relevant to the new 
deregulated system of ocean transportation established by this 
bill. Section 10217 also amends certain paragraphs in section 
10 of the 1984 act to tailor them to the requirements of 
amendments made by this subtitle.
    Paragraph (1) of section 10217 of this bill amends 
subsection 10(b)(1) of the 1984 act, effective January 1, 1997, 
to establish one consolidated prohibited act concerning 
discrimination against common carriers providing that, except 
for service contracts, no common carrier, either alone or in 
conjunction with any other person, directly or indirectly, may 
subject a person, place, port, or shipper to unreasonable 
discrimination. Paragraph (1) also repeals the prohibited acts 
contained in the following paragraphs of section 10(b) of the 
1984 act: (2) concerning rebates; (3) concerning privileges not 
in accordance with tariffs or service contracts; (4) concerning 
the use of false means to obtain transportation at less than 
tariff rates; and (8) concerning deferred rebates.
    Paragraph (2) of section 10217 of this subtitle amends 
subsection 10(b) of the 1984 act to abolish certain prohibited 
acts, including paragraphs: (6) concerning unfair or unjustly 
discriminatory practices, (9) concerning loyalty contracts, 
(10) concerning unjust discrimination between shippers or 
ports, and (11) concerning undue preference or advantage.
    New subsection 10(b): retains the prohibited act concerning 
retaliation against shippers (formerly paragraph (2)); expands 
the prohibited act against an unreasonable refusal to deal to 
include any class or type of shipper (formerly paragraph (12)); 
retain the prohibited act against a refusal to negotiate with a 
shippers' association (formerly paragraph (13)); makes 
technical amendments to the prohibited act against knowingly 
accepting cargo from an unbonded non-vessel-operating common 
carrier [NVOCC] to reflect the consolidation of NVOCC's and 
freight forwarders under this bill (formerly paragraph (14)); 
and makes similar technical amendments to the prohibited act 
against knowingly entering into a service contract with an 
unbonded NVOCC (formerly paragraph (15));
    New subsection 10(b)(8) (formerly paragraph (16)) contains 
an additional paragraph that, after December 31, 1997, 
prohibits the disclosure of the terms of ocean transportation 
contracts under paragraph (8) if the contracts has been made on 
a confidential basis. This new paragraph also establishes an 
action for breach of contract as an exclusive remedy for a 
disclosure under this paragraph.
    Paragraph (3) of section 10217 of this bill makes several 
additional amendments to section 10 of the 1984 act, effective 
June 1, 1997. Section 10(c)(1) of the 1984 act concerning 
boycotts or concerted action resulting in an unreasonable 
refusal to deal is amended to include a policy or practice that 
results in an unreasonable refusal to deal. This amendment is 
intended to enlarge the concept of unreasonable refusal to deal 
under the 1984 act to include policies that effectively 
preclude parties from doing business in the marketplace. For 
example, any concerted practice that targets freight forwarders 
or nonvessel-operating common carriers in order to keep them 
from competing in the marketplace is unacceptable under this 
paragraph.
    Section 10(c)(5) of the 1984 act is amended to limit ocean 
freight forwarder compensation under that paragraph to persons 
who perform the functions described in section 3(14)(A), as 
amended by this subtitle. Section 10(c)(6) of the 1984 act is 
amended to reflect the substitution of ocean transportation 
contracts for service contracts in the new shipping regime 
created by the amendments to the 1984 act made by this 
subtitle.
    Paragraph (4) of section 107 of this makes a technical 
amendment to section 10(d)(3) of the 1984 act to conform to the 
amendments made to the prohibited acts contained in section 107 
of this subtitle.

Sec. 10218. Reparations

    This section amends section 11(g) of the 1984 act (46 App. 
1710(g)) to make countercomplainants eligible for reparations 
under this section, and make other changes in the section to 
conform to amendments made under other sections of this 
subtitle.

 Sec. 10219. Foreign laws and practices

    This section amends section 10002 of the Foreign Shipping 
Practices Act of 1988 (46 App. U.S.C. 1710a) to make technical 
and conforming changes consistent with amendments made under 
other sections of this subtitle.

Sec. 11220. Penalties

    Section 11220 of this bill amends section 13 of the 1984 
act (46 App. U.S.C. 1712), effective on June 1, 1997, to amend 
the appropriate penalties for certain violations of this 
subtitle to conform to amendments made under other sections of 
this subtitle.

Sec. 11221. Reports

    Section 11221 of this subtitle repeals section 15(b) of the 
1984 act (46 App. U.S.C. 1714) relating to certification by the 
Federal Maritime Commission of policies concerning rebating.

Sec. 11222. Regulations

    Section 11222 of this bill repeals section 17(b) of the 
1984 act (46 App. U.S.C. 1716(b)) dealing with interim rules 
and regulations that were authorized to implement the 1984 act.

Sec. 11223. Repeal

    Section 113 repeals section 18 of the 1984 act (46 App. 
U.S.C. 1717) which required the study on the 1984 act completed 
in 1992 by the Advisory Commission on Conferences in Ocean 
Shipping.

Sec. 11224. Ocean freight forwarders

    Sec. 11224 of this bill amends section 19 of the 1984 act 
(46 App. U.S.C. 1718) to conform the application of section 19 
with the expanded definition of ocean freight forwarder under 
this subtitle to include nonvessel-operating common carrier.
    This section also clarifies that the bonding requirements 
under the 1984 act and the amendments made by this subtitle 
apply to all freight forwarders under this subtitle. Finally, 
this section prohibits a conference or group of two or more 
ocean common carriers from agreeing to limit compensation to an 
ocean freight forwarder who performs the functions as described 
in section 3(18)(A) of the amendments made by this subtitle to 
less than 1.25 percent of the aggregate of all rates and 
charges which are applicable under a common schedule of 
transportation rates provided under section 8(a) of the 1984 
act as amended by this subtitle.

Sec. 11225. Effects on certain agreements and contracts

    Section 11225 of this subtitle amends section 20(e) of the 
1984 act (46 App. U.S.C. 1719(e)) to provide the savings 
provisions related to service contracts entered into and 
lawsuits filed before the dates of enactment of the provisions 
of this subtitle.

Sec. 11226. Repeal

    Section 11226 of this subtitle repeals section 23 of the 
1984 act (46 App. U.S.C. 1721), concerning sureties for 
nonvessel-operating common carriers. The relevant sections of 
section 23 of the 1984 act are consolidated with the amendments 
made to section 19 of the act under section 11224 of this 
subtitle.

Sec. 11227. Marine terminator operator schedules

    Sec. 11227 of this subtitle adds a new section 24 to the 
1984 act, effective on June 1, 1997, to ensure that marine 
terminal operators continue to be compensated for transferring 
or protecting property from loss, complying with a governmental 
requirement, or storing property beyond the period originally 
agreed upon.
    In many cases, necessary services are performed by terminal 
operators for the benefit of cargo without a contract or other 
agreement with the cargo owner. Because of the need for prompt 
and safe movement of cargo, there is no effective way to 
negotiate for providing terminal services before those services 
are rendered. Also, most government inspections of cargo occur 
at marine terminals, and terminal operators are required to 
comply with governmental requirements concerning cargo 
regardless of prior arrangements with the cargo owner.
    New section 24 requires marine terminal operators to 
publish a schedule of rates, regulations, and practices, 
including limitations of liability, pertaining to receiving, 
delivering, handling, or storing property at its marine 
terminal. The schedule is enforceable as an implied contract, 
without proof of actual knowledge of its provisions, for any 
activity by the marine terminal operator to transfer property, 
protect property, comply with governmental requirements, or 
store property beyond the terms of any prior agreement.

               Chapter 2--Controlled Carriers Amendments

Sec. 10231. Controlled carriers

    Section 10231 of this subtitle amends section 9 of the 1984 
act (46 App. U.S.C. 1708), effective June 1, 1997, to broaden 
the group of ocean carriers to which the controlled carrier 
provisions, including the penalties, could potentially be 
applied. Under current law, the controlled carrier provisions 
apply only to carriers that are control by foreign governments. 
The reported bill would also apply these provisions to ``* * * 
ocean common carriers that are not controlled, but who have 
been determined by the Secretary of Transportation to be 
structurally or financially affiliated with nontransportation 
entities or organizations (government or private) in such a way 
as to affect their pricing or marketplace behavior in an 
unfair, predatory, or anticompetitive way that disadvantages an 
ocean common carrier or carriers.
    The original purpose of the controlled carrier provisions 
is to ensure carriers that have the benefits of government 
ownership or control are subjected to scrutiny and, if 
warranted, penalties for unfair marketplace behavior that 
affects trade with the United States. The most significant 
benefit accruing from government control is the reduced need 
(or even no need) to make a profit in the transportation 
marketplace. Unfortunately, such scrutiny and penalties are 
necessary to ensure that government control or ownership does 
not become a marketplace advantage in setting prices that other 
nongovernment controlled carriers simply do not have.
    While the best approach from a free and fair market 
perspective would be no government control of ocean carriers, 
not all nations are prepared to adopt that approach. The 
controlled carrier provisions ensure that the harmful effects 
of government control to the marketplace can be addressed and 
dealt with by our Government.
    In adopting the changes to the controlled carrier 
provisions, the committee finds that in today's global economy, 
it is not just carriers that are government-owned, that can 
engage in unfair or anticompetitive pricing to the detriment of 
the marketplace. Carriers that are affiliated with other 
nontransportation entities can be similarly structured within 
an overall private organization so that the transportation 
element is not looked upon to generate a profit enabling 
transportation therefore to be offered at unfair or 
anticompetitive prices.
    If this happens, the effect on the marketplace is no 
different than if a government controlled carrier engaged in 
this type of behavior. If we are concerned about how 
organizational relationships between a government and a carrier 
can distort marketplace behavior in ways that do harm to the 
marketplace, then we should have very similar concerns about 
structural or financial affiliations that may generate the same 
type of harmful marketplace behavior, even if they do not 
amount to government control as the term is understood today.
    Section 10231 of this subtitle also sets out the process by 
which a complaint could be brought or initiated by the 
Secretary. It is not one that could or should be used lightly. 
The Secretary would have to make a multistep determination 
(after investigation and public hearings) that:
          (1) a carrier was structurally or financially 
        affiliated with a government or private non-
        transportation entity;
          (2) that this affiliation was affected their pricing 
        or marketplace behavior in an unfair, predatory, or 
        anticompetitive way; and
          (3) that this affiliation harmed ocean common 
        carriers. This is no small hurdle to cross before a 
        determination could be made and penalties applied.
    When the Secretary conducts such an investigation and makes 
a determination that penalties are warranted, he or she should 
have found that the prices initiated by such carriers are below 
fully allocated costs plus a reasonable profit. Such pricing 
behavior should cause remedial action by the Secretary when 
U.S. carriers are disadvantaged through substantial lost sales, 
unless such lost sales result from prices which meet, but do 
not undercut, the then-existing prices of a carrier in the 
trade.
    The committee in no way believes this mechanism should be 
used routinely to regulate the prices charged in ocean shipping 
or engage in fishing expeditions related to pricing. The 
purpose of the provision is to zero in on specific problems in 
a particular market or trade and get the problems resolved. As 
a practical matter, the committee believes and observes that 
most such problems would likely be resolved through 
consultation and negotiation before the process established by 
this bill were fully completed.
    The committee also observes that use of this process in a 
frivolous manner to cause the investigation of pricing that is 
lower than the market at any given time, yet is actually 
competitive pricing, would greatly undermine the value and 
intent of these legislative changes. The committee expects the 
Secretary to administer these provisions with this in mind.
    This section also describes how information will be 
submitted to the Secretary and ensures that information 
submitted will be handled in a confidential manner.

Sec. 10232. Negotiating strategy to reduce Government ownership and 
        control of common carriers

    Section 10232 of this subtitle requires the Secretary of 
Transportation to develop and implement a negotiating strategy, 
not later than January 1, 1997, to persuade foreign governments 
to divest themselves of ownership and control of ocean common 
carriers.

Sec. 10233. Annual report to the Secretary

    This section requires an annual report from the Secretary 
of Transportation on actions taken on foreign shipping 
practices, controlled carriers, and negotiations to end foreign 
government control of ocean carriers.

       Chapter 3--Elimination of the Federal Maritime Commission

Sec. 10241. Plan for agency termination

    Title I of this subtitle deregulates the ocean shipping 
industry and abolishes the major functions of the Federal 
Maritime Commission [FMC]. The committee believes that a 
separate agency is not warranted to carry out the residual 
functions of the FMC, and directs, no later than 30 days after 
the date of enactment of this act, the Director of the Office 
of Management and Budget, in consultation with the Secretary of 
Transportation, to submit a plan to Congress to eliminate the 
Federal Maritime Commission [FMC] by October 1, 1997. The plan 
must include a timetable for the transfer of FMC functions to 
the Secretary of Transportation as soon as possible in fiscal 
year 1996. The plan must also address personnel matters and 
other matters relevant to the transfer of remaining FMC 
functions. Other matters that should be addressed in the plan 
include technical legislative changes that should be made to 
abolish the FMC and transfer remaining functions to the 
Secretary.
    The committee understands that the Director of the Office 
of Management and Budget has the inherent authority to 
implement the FMC phaseout plan as directed under this 
subsection (b) of this section. The committee emphasizes that 
all FMC functions that remain at the end of fiscal year 1997 
must be transferred to the Secretary of Transportation, and not 
to any other department or agency.
    The committee also emphasizes that the phaseout of the FMC 
must begin as soon as possible in fiscal year 1996. In the 
phaseout plan, the Director should consider FMC functions that 
could be transferred immediately to the Secretary of 
Transportation. Regardless, the Director must take whatever 
steps are necessary to ensure that all FMC functions are 
transferred by the end of fiscal year 1997, and that no 
appropriation will be necessary in fiscal year 1998 for FMC 
operations.
    Finally, this section authorizes such sums as may be 
necessary to carry out this subtitle and the amendments made by 
this subtitle.

             subtitle c--midewin national tallgrass prairie

    This subtitle incorporates the provisions of H.R. 714, the 
Illinois Land Conservation Act of 1995. H.R. 714, which would 
establish the Midewin National Tallgrass Prairie [MNP] in 
northeast Illinois. The subtitle provides for the conversion of 
the Department of the Army's Joliet Ammunition Plant (``Joliet 
Arsenal'') to nondefense purposes.
    In addition to establishing the MNP, the subtitle provides 
for the transfer of certain arsenal property to the Department 
of Veterans Affairs for use as a national cemetery; to Will 
County, IL, for use as a landfill; and to the State of Illinois 
for economic development. The subtitle also ensures that Army 
completes necessary environmental cleanup activities on arsenal 
properties under Superfund legislation and satisfies the 
requirements of other environmental laws prior to properties 
being converted to other uses.

                       SUBTITLE D--MISCELLANEOUS

Sec. 10401. Extension of higher vessel tonnage duties

     This section maintains the current level of vessel tonnage 
duties through fiscal year 2002, consistent with the 
reconciliation instructions the committee received from the 
Budget Committee.
     A vessel arriving from a foreign port in the northern 
Western Hemisphere (Canada Mexico, Central America, West 
Indies, Bahamas, Bermuda, and northern South America) and a 
vessel returning from a ``voyage to nowhere'' must pay a 
tonnage duty of 9 cents per ton. However, the maximum payment 
for any vessel in a single year is 45 cents per ton. A vessel 
arriving from a foreign port anywhere else in the world must 
pay a tonnage duty of 27 cents per ton, not to exceed $1.35 per 
ton in a single year.

Sec. 10402. Sale of Governors Island, NY

     This section requires the Administrator of the General 
Services Administration to sell Governors Island, NY, at fair 
market value. The section waives all provisions of the Federal 
Property and Administrative Services Act, as amended, and gives 
the State of New York and the city of New York a right of first 
refusal to purchase the property. The proceeds of the sale will 
be deposited in the miscellaneous account of the U.S. Treasury.

Sec. 10403. Sale of air rights

     This section directs the Administrator of the General 
Services Administration to sell approximately 16.5 acres of air 
rights adjacent to Washington, DC, Union Station at fair market 
value in a manner determined by the Administrator.
    Included below is a 1992 GSA appraisal of these Union 
Station air rights at about $50 million:

                         summary of conclusions

    Subject property--Lot 801 in square 715, part of lot 811 in 
square 717, parts of lots 172 and 823 in square 720, all 
located north of Union Station, Northeast, Washington, DC.
    Date of valuation--March 18, 1992.
    Date of inspection--March 18, 1992.
    Date of report--April 6, 1992.

                                              GROSS AREAS OF SITES                                              
----------------------------------------------------------------------------------------------------------------
                                                                                 Site                           
                  Site                                Current use               area sf         Owner 3DI       
----------------------------------------------------------------------------------------------------------------
Sq 720 lot 172.........................  Garage..............................   399,861  USRC                   
Sq 720 lot 823.........................  H St-Rail yard......................    93,194  Amtrak                 
Sq 717 lot 811.........................  H to K-Rail yard....................   411,561  USRC                   
Sq 715 lot 801.........................  1st and K-Vacant....................     7,982  Kayfirst               
                                                                              ----------                        
      Total............................  ....................................   912,598  .......................
----------------------------------------------------------------------------------------------------------------

    Parcels analyzed.--Parcel 1--152,861 sq. ft.; Parcel 3--
93,194 sq. ft.; platform B So/H part of Sq 720/172, 246,055 sq. 
ft. total.
    Parcel 4--45,223 sq. ft.; Exist garage part of Sq 720/172 
and 823, 45,223 sq. ft. total.
    Parcel 5--335,435 sq. ft.; Platform A No/M part of Sq 717/
811, 335,435 sq. ft. total.
    Total air rights ``Site''--626,713 sq. ft.
    Parcel 6--7,982 sq. ft.; Square 715 lot 801 7,982 sq. ft. 
total.
    Zoning--CM-3 and M.
    Highest and best use--Appraised--special purpose as 
headquarters site for Department of Transportation or other 
U.S. Government agency.
    Rights appraised--Air rights and fee simple rights, 
including existing garage deck and support and maintenance 
rights for platforms as specified in report.
    Purpose of appraisal--Estimate fair market value of various 
rights for negotiation and condemnation purposes by General 
Services Administration.
    Value conclusions, as of March 18, 1992, subject to all 
assumptions and conditions set forth within this report, are as 
follows:

        Parcel number                                     Value estimate
Parcel 1 (Air rights)...................................     $20,900,000
Parcel 3 (Air rights)...................................      12,700,000
Parcel 4 (Air rights) including deck....................       9,700,000
Parcel 5 (Air rights)...................................       6,400,000
Parcel 6 (Fee)..........................................         550,000

    Please note that the conclusions reached herein were based 
on the information as set forth herein. Additional analyses, in 
the event that additional or new information is made available 
are outside of the scope of this assignment and additional 
arrangements would be necessary before additional analyses 
could be undertaken. The assumptions and conditions set forth 
throughout the report, including by not limited to 
environmental assumptions, structural assumptions, railroad 
operations assumptions and proposed building occupancy 
assumptions, are an integral part of this analysis and have a 
bearing on the conclusions reached herein. If professional (by 
others) investigation reveals that significant costs will be 
incurred in achieving these assumptions, the values estimated 
herein would be subject to change.

Sec. 10404. Parking fees

    This section directs the Administrator of the General 
Services Administration to issue regulations requiring each 
executive agency to collect fees for the use of all parking 
facilities provided for the agency at Federal expense. Fees 
would be charged at fair market rates and would be deposited in 
the Treasury as miscellaneous receipts.

    SUBTITLE E--ECONOMIC DEVELOPMENT ADMINISTRATION AND APPALACHIAN 
                          REGIONAL COMMISSION

Sec. 10501. Short title; Effective date

     The Subtitle may be cited as the ``Economic Development 
Partnership Act of 1995,'' with an effective date 6 months 
after the date of enactment.

Chapter I--Transfer of Functions of Economic Development Administration

Sec. 10511. Reauthorization of Public Works and Economic Development 
        Act of 1965

    Strikes the Public Works and Economic Development Act of 
1965 and replaces it with EDA provisions of the reform bill, 
H.R. 2145. Also includes congressional findings of the need for 
Federal assistance to distressed areas. Section by section of 
EDA provisions of the reform bill as follows:

                Title I--Economic Development Commission

 Sec. 101. Establishment of Economic Development Commission

    Establishes an independent Commission within executive 
branch.

 Sec. 102. Establishment of Regional Commissions

    Establishes the Regional Commissions based on the model 
used to set up the Appalachian Regional Commission. Sets 
requirements for Commission voting. Both the Federal cochairman 
and the States must agree on Commission decisions.

 Sec. 103. Cooperation of Federal agencies

    Encourages Federal agencies to cooperate with the 
Commissions.

 Sec. 104. Administrative expenses

    Establishes that the Federal Government and States each pay 
50 percent of the administrative expenses of the Commissions. 
Each Commission shall allocate the share of expenses within a 
region. A State delinquent in its payments shall not be 
eligible to participate in Commission votes and shall not be 
eligible to receive assistance authorized by this act.

 Sec. 105. Administrative powers

    Lists a number of administrative powers necessary to 
operate the Commissions. The Commissions will have the 
authority to contract with the Office of Personnel Management 
to continue pension contributions for former Federal employees 
hired by the Commissions.

 Sec. 106. Establishment of regions

    Divides the Nation into eight Regional Commissions. No 
State shall be required to participate in any program under 
this act.

      Title II--Grants for Public Works and Development Facilities

 Sec. 201. Direct and supplementary grants

    Provides authority to make grants for infrastructure 
projects, using the same language provided under title I of 
PWEDA. There is a 50-percent cost share for projects. Retains 
current authority to make supplemental grants to other Federal 
programs.

 Sec. 202. Construction cost increases

    Provides for increases in grant funding due to construction 
cost increases, at the discretion of the Commission.

 Sec. 203. Use of funds in projects constructed under projected cost

    Provides that funds available because of projects completed 
under cost may be used to further improve the project, as 
determined by the Commission.

 Sec. 204. Changed project circumstances

    Commissions may provide that grant funds can be used for a 
project that has a change in scope.

    Title III--Special Economic Development and Adjustment Assistance

 Sec. 301. Statement of purpose

    States that this title funds projects necessary to respond 
to sudden and severe economic dislocations.

 Sec. 302. Grants by regional commissions

    Establishes eligibility for grants under this title. The 
Secretary shall establish criteria to be used. Grants may be 
used for a broad range of economic development assistance, 
including grants, loans, and loan guarantees. Includes language 
previously passed by the House allowing funds to be used at 
closed or realigned military installations.

 Sec. 303. Annual reports by recipient

    Requires grant recipients to report to Commissions on the 
use and effectiveness of grant funds.

 Sec. 304. Sale of financial instruments in revolving loan funds

    Allows for the sale of financial instruments in revolving 
loan funds, to recapitalize such funds.

 Sec. 305. Treatment of revolving loan funds

    Includes language adopted by the House last year to provide 
administrative relief to EDA funded revolving loan funds by 
defederalizing the funds.

       Title IV--Technical Assistance, Research, and Information

Sec. 401. Technical assistance

    Provides that commissions may fund planning assistance 
grants. This authority is the same as that currently provided 
by PWEDA. Grants may be made to development districts, 
university centers, or other eligible entities. Commissions may 
also provide grants for planning technical assistance.

Sec. 402. Economic development planning

    Provides authority to make annual planning grants to 
development districts. Requires that such planning involve 
local public officials and private citizens.

             Title V--Eligibility and Investment Strategies

Sec. 501. Eligible recipient defined

    Eligibility is granted to State and local governments, 
Indian tribes, development districts, and non-profits working 
with local governments.

Sec. 502. Area eligibility

    Sets eligibility criteria of: First, per capita income of 
80 percent or less of the national average; second, 
unemployment rate 1 percent above the national average for the 
most recent 24-month period; third, sudden and severe job loss; 
or fourth, a pocket of poverty. Prior designations of 
eligibility, which made 85 percent of the Nation qualify for 
assistance are wiped out. An area must qualify each time it 
makes a grant application.

Sec. 503. Investment strategy

    Requires applicants for assistance to have an approved 
investment strategy to show how the assistance will be of 
benefit and how it will be coordinated with other economic 
development activities.

Sec. 504. Approval of projects

    Consistent with the Regional Commission approach, clarifies 
that State certification is required for a project to be 
approved.

Sec. 510. Designation of economic development districts and economic 
        development centers

    Provides criteria and a process for the designation of 
economic development districts.

                        Title VI--Administration

Sec. 601. Functions of economic development commission

    Provides for an Office of Economic Development to assist 
the Federal cochairman in carrying out the Federal cochairman's 
duties under the act. Authorizes the Office of Economic 
Development to serve as a Federal clearinghouse for economic 
development information. This office would also provide such 
assistance for communities responding to base closures, base 
realignments and other defense cutbacks.

Sec. 602. Consultation with other persons and agencies

    Provides for consultations with other agencies and outside 
interests.

Sec. 603. Administration, operation, and maintenance

    Provides for assurances of Federal interests in grant 
funds.

Sec. 604. Authority to establish independent agency in event Department 
        of Commerce is abolished

    Provides for transfer of Commissions to independent agency 
status upon the termination of the Department of Commerce.

Sec. 605. Treatment of Economic Development Regional Commission 
        employees

    Provides preferential hiring rights at the Regional 
Commissions for current EDA employees.

                        Title VII--Miscellaneous

Sec. 701. Powers of Federal cochairman

    Provides numerous powers to the Federal cochairman 
necessary to carry out duties under this Act. The Federal 
cochairman may make discretionary grants from funds withheld 
from distribution to Regional Commissions; except that such 
grants may not total more than 10 percent of appropriated 
funds.

Sec. 702. Allocation of funds

    The Federal cochairman shall establish a formula for the 
equitable allocation among the Regional Commissions of amounts 
appropriated to carry out this act.

Sec. 703. Performance measures

    Provides for the establishment of performance measures to 
insure that assistance is spent in a cost-effective manner.

Sec. 704. Maintenance of standards

    Continues in effect provisions of section 712 of PWEDA.

Sec. 705. Transfer of functions

    Provides for the transfer of other minor authorities.

Sec. 706. Definition of State

    For this act, defines State to include the several States, 
the District of Columbia, the Commonwealth of Puerto Rico, the 
Virgin Islands, Guam, and American Samoa.

Sec. 707. Annual report to Congress

    Provides for one annual consolidated report to Congress on 
the activities of the commissions and Federal cochairman.

Sec. 708. Use of other facilities

    Allows for the delegation of certain authorities to other 
Federal agencies. Also allows funds to be transferred between 
agencies.

Sec. 709. Penalties

    Provides legal penalties currently used for PWEDA.

Sec. 710. Employment of expediters and administrative employees

    Sets conditions on funding of certain business enterprises 
to protect from conflict of interest.

Sec. 711. Personal financial interests

    Provides protection against conflicts of interest by 
members and employees of Regional Commissions.

Sec. 712. Maintenance of records of approved applications for financial 
        assistance; public inspection

    Requires the Federal cochairman to keep a public record of 
grants and applications.

Sec. 713. Records and audit

    Requires grant recipients to follow record keeping and 
audit requirements.

Sec. 714. Prohibition against a statutory construction which might 
        cause diminution in other Federal assistance

    Provides that all funding authorized in this act shall be 
in addition to funding provided under other Federal programs.

Sec. 715. Acceptance of applicant's certifications

    Allows for self-certification by applicants, at the 
discretion of the commissions.

                          Title VIII--Funding

Sec. 801. Authorization of appropriations

    Authorizes $340 million a year, for fiscal years 1996, 
1997, 1998, 1999, and 2000, to carry out the purposes of this 
act. This is a $100 million a year reduction from fiscal year 
1995 levels.

Sec. 802. Defense conversion activities

    In addition to authorizations under section 801, provides 
such sums for other defense conversion activities eligible 
under this act.

Sec. 10512. Conforming amendments

    Section 10512 provides additional, necessary statutory 
changes to create the Commissions.

Sec. 10513. Savings provision

              Chapter 2--Appalachian Regional Development

Sec. 10521. Findings and purposes

    Outlines congressional findings of a continuing need for 
programs in Appalachia to provide infrastructure and other 
economic assistance. In particular, the purpose of the act is 
to address the needs of severely and persistently distressed 
and underdeveloped areas of the region so as to provide a 
fairer opportunity for the people of the region to share the 
quality of life generally enjoyed by citizens across the 
Nation.

Sec. 10522. Meetings

    Requires at least one yearly meeting of the Commission with 
the Federal cochairman and at least a majority of State members 
present. Allows additional meetings via electronic means.

Sec. 10523. Authorizations for administrative expenses

    Authorizes $3.645 million per fiscal year, from 1996 
through 2000, for administrative expenses. Of the total, not 
more than $1.245 million shall be for the expenses of the 
Federal co-chairman. Under the commission model, States will 
continue to share in the administrative costs of ARC.

Sec. 10524. Administrative powers of commission

Sec. 10525. Highway system

    Authorizes $90 million each fiscal year, from 1996 through 
2000, for construction of the 3,025 mile Appalachian 
Development Highway System. In addition, a technical change is 
made to conform the Federal matching rate for prefinanced ARC 
highways.

Sec. 10526. Cost sharing of demonstration health projects

    Limits ARC funding for health and child care demonstration 
projects to 50 percent, except that the limit could be raised 
up to 80 percent for projects located in distressed counties.

Sec. 10527. Repeal of Land Stabilization, Conservation, and Erosion 
        Control Program

    Repeals section 203 of the act which authorized projects 
for land stabilization, conservation, and erosion control.

Sec. 10528. Repeal of Timber Development Program

    Repeals section 204 of the act which authorized projects 
for timber development.

Sec. 10529. Repeal of Mining Area Restoration Program

    Repeals section 205 of the act which authorized projects 
for mining area restoration.

Sec. 10530. Repeal of water resource survey

    Repeals section 206 of the act which authorized a water 
resource survey for the region.

Sec. 10531. Cost sharing of housing projects

    Limits ARC funding for grants and loans for planning and 
obtaining financing for low- and moderate-income housing 
construction or rehabilitation projects to 50 percent, except 
that the limit could be raised up to 80 percent for projects 
located in distressed counties.

Sec. 10532. Repeal of Airport Safety Improvements Program

    Repeals section 208 of the act which authorized airport 
safety projects.

Sec. 10533. Cost sharing of education programs

    Limits ARC funding for vocational education and education 
demonstration projects to 50 percent, except that the limit 
could be raised up to 80 percent for projects located in 
distressed counties.

Sec. 10534. Sewage treatment works program

    Repeals section 212 of the act which authorized projects 
for sewage treatment works.

Sec. 10535. Repeal of amendments to Housing Act of 1954

    Repeals section 213 of the act which made the ARC an 
eligible agency to receive comprehensive housing planning 
grants under provisions of the Housing Act of 1954. Such 
provisions have since been repealed.

Sec. 10536. Supplements to Federal grant-in-aid programs

    Limits ARC funding for supplements to other Federal grant-
in-aid programs with a limit of 50 percent of project costs, 
except that the limit could be raised up to 80 percent for 
projects located in distressed counties. Additionally, 
clarifies that title 23 highway projects are not eligible for 
supplemental grant funding.

Sec. 10537. Program development criteria

    Adds recognition of severe and persistent economic distress 
to the criteria used for consideration of programs and projects 
to be funded. Also adds criteria to insure that programs and 
projects will be subject to outcome measurements and benchmarks 
designed to justify expenditures. Language also removes some 
dated limitations on types of assistance to be provided by the 
Commission.

Sec. 10538. Distressed and economically competitive counties

    Within 90 days of enactment, and annually thereafter, the 
Commission shall designate distressed and economically 
competitive counties among the 399 counties in the Appalachian 
region. Such designations will be made by criteria to be 
established by the Commission. Distressed counties are those 
that are most severely and persistently distressed and 
underdeveloped. Economically competitive counties are those 
which have attained substantial economic parity with the rest 
of the Nation.
    The Commission may discontinue an existing designation, 
except that any designation of a distressed county shall remain 
in effect for 3 years.
    Funds may not be provided for a project in an economically 
competitive county, except for projects on the Appalachian 
Development Highway System, for local development districts, 
and discretionary grants authorized by section 302(a).

Sec. 10539. Grant for administrative expenses and Commission projects

    Amends subsection 302(a) of the act to provide cost-sharing 
limitations of 50 percent, with up to 80 percent allowed in 
distressed counties. Exceptions to these cost share limitations 
on 302(a) grants are made for regional initiatives or emergency 
situations. Total funds made available may not exceed 10 
percent of total nonhighway authorizations under section 401.

Sec. 10540. Authorization of appropriations for general program

    Amends section 401 of the act to authorize $88.355 million 
for each fiscal year, from 1996 to 2000, for the nonhighway 
program.

Sec. 10541. Extension of termination date

    Amends section 405 of the act to extend the termination 
date for the Commission to October 1, 2000.

    Changes in Existing Law Made by Title X of the Bill, as Reported

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed is italics, existing law in which no change 
is proposed is shown in roman):

                          SHIPPING ACT OF 1984

   AN ACT To improve the international ocean commerce transportation 
                      system of the United States.

    Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That this 
Act may be cited as the ``Shipping Act of 1984''.

                            Table of Contents

Sec. 2. Declaration of policy.
     * * * * * * *
[Sec. 15. Reports and certificates.]
Sec. 15. Reports.
     * * * * * * *
[Sec. 18. Agency reports and advisory commission.]
     * * * * * * *
[Sec. 23. Surety for non-vessel-operation common carriers.]
Sec. 24. Marine terminal operator schedules.

 The changes shown below will take effect on the date of the enactment 
                              of this Act

SEC. 2 DECLARATION OF POLICY.

    The purposes of this Act are--
          (1) to establish a nondiscriminatory regulatory 
        process for the common carriage of goods by water in 
        the foreign commerce of the United States with a 
        minimum of government intervention and regulatory 
        costs;
          (2) to provide an efficient and economic 
        transportation system in the ocean commerce of the 
        United States that is, insofar as possible, in harmony 
        with, and responsive to, international shipping 
        practices; [and]
          (3) to encourage the development of an economically 
        sound and efficient United States flag liner fleet 
        capable of meeting national security needs[.] ; and
          (4) to permit carriers and shippers to develop 
        transportation arrangements to meet their specific 
        needs.

      The changes shown below will take effect on January 1, 1997

SEC. 3. DEFINITIONS.

    As used in this Act--
          (1) * * * 
          * * * * * * *
          [(9) ``deferred rebate'' means a return by a common 
        carrier of any portion of the freight money to a 
        shipper as a consideration for that shipper giving all, 
        or any portion, of its shipments to that or any other 
        common carrier, or for any other purpose, the payment 
        of which is deferred beyond the completion of the 
        service for which it is paid, and is made only if, 
        during both the period for which computed and the 
        period of deferment, the shipper has complied with the 
        terms of the rebate agreement or arrangement.]
          [(10)] (9) ``fighting ship'' means a vessel used in a 
        particular trade by an ocean common carrier or group of 
        such carriers for the purpose of excluding, preventing, 
        or reducing competition by driving another ocean common 
        carrier out of that trade.
          [(11)] (10) ``forest products'' means forest products 
        in an unfinished or semifinished state that require 
        special handling moving in lot sizes too large for a 
        container, including, but not limited to lumber in 
        bundles, rough timber, ties, poles, piling, laminated 
        beams, bundled siding, bundled plywood, bundled core 
        stock or veneers, bundled particle or fiber boards, 
        bundled hardwood, wood pulp in rolls, wood pulp in 
        unitized bales, paper board in rolls, and paper in 
        rolls.
          [(12)] (11) ``inland division'' means the amount paid 
        by a common carrier to an inland carrier for the inland 
        portion of through transportation offered to the public 
        by the common carrier.
          [(13)] (12) ``inland portion'' means the charge to 
        the public by a common carrier for the nonocean portion 
        of through transportation.
          [(14)] (13) ``loyalty contract'' means a contract 
        with an ocean common carrier or conference, other than 
        a service contract or contract based upon time-volume 
        rates, by which a shipper obtains lower rates by 
        committing all or a fixed portion of its cargo to that 
        carrier or conference.
          [(15)] (14) ``marine terminal operator'' means a 
        person engaged in the United States in the business of 
        furnishing wharfage, dock, warehouse, or other terminal 
        facilities in connection with a common carrier.
          [(16)] (15) ``maritime labor agreement'' means a 
        collective-bargaining agreement between an employer 
        subject to this Act, or group of such employers, and a 
        labor organization representing employees in the 
        maritime or stevedoring industry, or an agreement 
        preparatory to such a collective-bargaining agreement 
        among members of a multiemployer bargaining group, or 
        an agreement specifically implementing provisions of 
        such a collective-bargaining agreement or providing for 
        the formation, financing, or administration of a 
        multiemployer bargaining group; but the term does not 
        include an assessment agreement.
          [(17)] (16) ``non-vessel-operating common carrier'' 
        means a common carrier that does not operate the 
        vessels by which the ocean transportation is provided, 
        and is a shipper in its relationship with an ocean 
        common carrier.
          [(18)] (17) ``ocean common carrier'' means a vessel-
        operating common carrier.
          [(19)] (18) ``ocean freight forwarder'' means a 
        person in the United States that--
                  (A) dispatches shipments from the United 
                States via common carriers and books or 
                otherwise arranges space for those shipments on 
                behalf of shippers; and
                  (B) processes the documentation or performs 
                related activities incident to those shipments.
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 3. DEFINITIONS.

    As used in this Act--
          (1) * * *
          * * * * * * *
          [(4) ``bulk cargo'' means cargo that is loaded and 
        carried in bulk without mark or count.]
          * * * * * * *
          (7) ``conference'' means an association of ocean 
        common carriers permitted, pursuant to an approved or 
        effective agreement, to engage in concerted activity 
        and to utilize [a common tariff;] a common schedule of 
        transportation rates, changes, classifications, rules, 
        and practices; but the term does not include a joint 
        service, consortium, pooling, sailing, or transshipment 
        arrangement.
          [(10) ``forest products'' means forest products in an 
        unfinished or semifinished state that require special 
        handling moving in lot sizes too large for a container, 
        including, but not limited to lumber in bundles, rough 
        timber, ties, poles, piling, laminated beams, bundled 
        siding, bundled plywood, bundled core stock or veneers, 
        bundled particle or fiber boards, bundled hardwood, 
        wood pulp in rolls, wood pulp in unitized bales, paper 
        board in rolls, and paper in rolls.]
          * * * * * * *
          [(13) ``loyalty contract'' means a contract with an 
        ocean common carrier or conference, other than a 
        service contract or contract based upon time-volume 
        rates, by which a shipper obtains lower rates by 
        committing all or a fixed portion of its cargo to that 
        carrier or conference.]
          * * * * * * *
          [(16) ``non-vessel-operating common carrier'' means a 
        common carrier that does not operate the vessels by 
        which the ocean transportation is provided, and is a 
        shipper in its relationship with an ocean common 
        carrier.]
          * * * * * * *
          [(18) ``ocean freight forwarder'' means a person in 
        the United States that--
                  [(A) dispatches shipments from the United 
                States via common carriers and books or 
                otherwise arranges space for those shipments on 
                behalf of shippers; and
                  [(B) processes the documentation or performs 
                related activities incident to those 
                shipments.]
          (18) ``ocean freight forwarder'' means a person 
        that--
                  (A)(i) in the United States, dispatches 
                shipments from the United States via a common 
                carrier and books or otherwise arranges space 
                for those shipments on behalf of shippers; or
                  (ii) processes the documentation or performs 
                related activities incident to those shipments; 
                or
                  (B) acts as a common carrier that does not 
                operate the vessels by which the ocean 
                transportation is provided, and is a shipper in 
                its relationship with an ocean common carrier.
          (19) ``ocean transportation contract'' means a 
        contract in writing separate from the bill of lading or 
        receipt between 1 or more common carriers or a 
        conference and 1 or more shippers to provide specified 
        services under specified rates and conditions.
          * * * * * * *
          [(21) ``service contract'' means a contract between a 
        shipper and an ocean common carrier or conference in 
        which the shipper makes a commitment to provide a 
        certain minimum quantity of cargo over a fixed time 
        period, and the ocean common carrier or conference 
        commits to a certain rate or rate schedule as well as a 
        defined service level--such as, assured space, transit 
        time, port rotation, or similar service features; the 
        contract may also specify provisions in the event of 
        nonperformance on the part of either party.]
          * * * * * * *
          (23) ``shipper'' means an owner or person for whose 
        account the ocean transportation of cargo is provided 
        [or], the person to whom delivery is to be made[.], a 
        shippers' association, or an ocean freight forwarder 
        that accepts responsibility for payment of the ocean 
        freight.
          [(24) ``shippers' association'' means a group of 
        shippers that consolidates or distributes freight on a 
        nonprofit basis for the members of the group in order 
        to secure carload, truckload, or other volume rates or 
        service contracts.]
          (24) ``shippers' association'' means a group of 
        shippers that consolidates or distributes freight, on a 
        nonprofit basis for the members of the group in order 
        to secure carload, truckload, or other volume rates or 
        ocean transportation contracts.
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 4. AGREEMENTS WITHIN SCOPE OF ACT.

    (a) Ocean Common Carriers.--This Act applies to agreements 
by or among ocean common carriers to--
          (1) * * *
          * * * * * * *
          (5) engage in exclusive, preferential, or cooperative 
        working arrangements among themselves or with one or 
        more marine terminal operators or [non-vessel-operating 
        common carriers] ocean freight forwarders;
          * * * * * * *
          [(7) regulate or prohibit their use of service 
        contracts.]
          (7) discuss any matter related to ocean 
        transportation contracts, and enter ocean 
        transportation contracts and agreements related to 
        those contracts.
          * * * * * * *

      The changes shown below will take effect on January 1, 1997

SEC. 5. AGREEMENTS.

    (a) * * *
    (b) Conference Agreements.--Each conference agreement 
must--
          (1) * * *
          * * * * * * *
          (4) [at the request of any member, require an 
        independent neutral body to police fully] state the 
        provisions, if any, for the policing of the obligations 
        of the conference and its members;
          * * * * * * *
          (7) establish procedures for promptly and fairly 
        considering shippers' requests and complaints; [and]
          (8) provide that any member of the conference may 
        take independent action on any rate or service item 
        required to be filed in a tariff under section 8(a) of 
        this Act upon not more than 10 calendar days' notice to 
        the conference and that the conference will include the 
        new rate or service item in its tariff for use by that 
        member, effective no later than 10 calendar days after 
        receipt of the notice, and by any other member that 
        notifies the conference that it elects to adopt the 
        independent rate or service item on or after its 
        effective date, in lieu of the existing conference 
        tariff provision for that rate or service item[.]; and
          (9) provide that a member of the conference may enter 
        individual and independent negotiations and may 
        conclude individual and independent service contracts 
        under section 8 of this Act.

        The changes shown below will take effect on June 1, 1997

SEC. 5. AGREEMENTS.

    (a) * * *
    (b) Conference Agreements.--Each conference agreement 
must--
          (1) * * *
          * * * * * * *
          [(8) provide that any member of the conference may 
        take independent action on any rate or service item 
        required to be filed in a tariff under section 8(a) of 
        this Act upon not more than 10 calendar days' notice to 
        the conference and that the conference will include the 
        new rate or service item in its tariff for use by that 
        member, effective no later than 10 calendar days after 
        receipt of the notice, and by any other member that 
        notifies the conference that it elects to adopt the 
        independent rate or service item on or after its 
        effective date, in lieu of the existing conference 
        tariff provision for that rate or service item; and]
          (8) provide that any member of the conference may 
        take independent action on any rate or service item 
        agreed upon by the conference for transportation 
        provided under section 8(a) of this Act upon not more 
        than 3 business days' notice to the conference, and 
        that the conference will provide the new rate or 
        service item for use by that member, effective no later 
        than 3 business days after receipt of that notice, and 
        by any other member that notifies the conference that 
        it elects to adopt the independent rate or service item 
        on or after its effective date, in lieu of the existing 
        conference provision for that rate or service item;
          (9) provide that a member of the conference may enter 
        individual and independent negotiations and may 
        conclude individual and independent [service] ocean 
        transportation contracts under section 8 of this 
        Act[.]; and
          (10) prohibit the conference from--
                  (A) prohibiting or restricting the members of 
                the conference from engaging in individual 
                negotiations for ocean transportation contracts 
                under section 8(b) with 1 or more shippers; and
                  (B) issuing mandatory rules or requirements 
                affecting ocean transportation contracts that 
                may be entered by 1 or more members of the 
                conference, except that a conference may 
                require that a member of the conference 
                disclose the existence of an existing 
                individual ocean transportation contract or 
                negotiations on an ocean transportation 
                contract, when the conference enters 
                negotiations on an ocean transportation 
                contract with the same shipper.
          * * * * * * *
    (e) Maritime Labor Agreements--This Act, the Shipping Act, 
1916, and the Intercoastal Shipping Act, 1933, do not apply to 
maritime labor agreements. This subsection does not exempt from 
this Act, the Shipping Act, 1916, or the Intercoastal Shipping 
Act, 1933, any rates, charges, regulations, or practices of a 
common [carrier that are required to be set forth in a tariff,] 
carrier, whether or not those rates, charges, regulations, or 
practices arise out of, or are otherwise related to, a maritime 
labor agreement.
          * * * * * * *

 The changes shown below will take effect on the date of the enactment 
                              of this Act

SEC. 7. EXEMPTION FROM ANTITRUST LAWS.

    (a) In General.--The antitrust laws do not apply to--
          (1) * * *
          * * * * * * *
    [(6) subject to section 20(e)(2) of this Act, any 
agreement, modification, or cancellation approved by the 
Commission before the effective date of this Act under section 
15 of the Shipping Act, 1916, or permitted under section 14b 
thereof, and any properly published tariff, rate, fare, or 
charge, classification, rule, or regulation explanatory thereof 
implementing that agreement, modification, or cancellation.]
    (6) subject to section 20(e)(2) of this Act, any agreement, 
modification, or cancellation, in effect before the effective 
date of this Act and any tariff, rate, fare, charge, 
classification, rule, or regulation explanatory thereof 
implementing that agreement, modification, or cancellation.
          * * * * * * *
    (c) Limitations.--(1) Any determination by an [agency] 
agency, department, or court that results in the denial or 
removal of the immunity to the antitrust laws set forth in 
subsection (a) shall not remove or alter the antitrust immunity 
for the period before the determination.
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 8. TARIFFS.

    [(a) In General.--
         (1) Except with regard to bulk cargo, forest products, 
        recycled metal scrap, waste paper, and paper waste, 
        each common carrier and conference shall file with the 
        Commission, and keep open to public inspection, tariffs 
        showing all its rates, charges, classifications, rules, 
        and practices between all points or ports on its own 
        route and on any through transportation route that has 
        been established. However, common carriers shall not be 
        required to state separately or otherwise reveal in 
        tariff filings the inland divisions of a through rate. 
        Tariffs shall--
                 [(A) state the places between which cargo will 
                be carried;
                 [(B) list each classification of cargo in use;
                 [(C) state the level of ocean freight 
                forwarder compensation, if any, by a carrier or 
                conference;
                 [(D) state separately each terminal or other 
                charge, privilege, or facility under the 
                control of the carrier or conference and any 
                rules or regulations that in anyway change, 
                affect, or determine any part or the aggregate 
                of the rates or charges; and
                 [(E) include sample copies of any loyalty 
                contract, bill of lading, contract of 
                affreightment, or other document evidencing the 
                transportation agreement.
         [(2) Copies of tariffs shall be made available to any 
        person, and a reasonable charge may be assessed for 
        them.
    [(b) Time Volume Rates.--Rates shown in tariffs filed under 
subsection (a) may vary with the volume of cargo offered over a 
specified period of time.
    [(c) Service Contracts.--An ocean common carrier or 
conference may enter into a service contract with a shipper or 
shippers' association subject to the requirements of this Act. 
Except for service contracts dealing with bulk cargo, forest 
products, recycled metal scrap, waste paper, or paper waste, 
each contract entered into under this subsection shall be filed 
confidentially with the Commission, and at the same time, a 
concise statement of its essential terms shall be filed with 
the Commission and made available to the general public in 
tariff format, and those essential terms shall be available to 
all shippers similarly situated. The essential terms shall 
include--
         [(1) the origin and destination port ranges in the 
        case of port-of-port movements, and the origin and 
        destination geographic areas in the case of through 
        intermodal movements;
         [(2) the commodity or commodities involved;
         [(3) the minimum volume;
         [(4) the line-haul rate;
         [(5) the duration;
         [(6) service commitments; and
         [(7) the liquidated damages for nonperformance, if 
        any.
The exclusive remedy for a breach of a contract entered into 
under this subsection shall be an action in an appropriate 
court, unless the parties otherwise agree.
    [(d) Rates.--No new or initial rate or change in an 
existing rate that results in an increased cost to the shipper 
may become effective earlier than 30 days after filing with the 
Commission. The Commission, for good cause, may allow such a 
new or initial rate or change to become effective in less than 
30 days. A change in an existing rate that results in a 
decreased cost to the shipper may become effective upon 
publication and filing with the Commission.
    [(e) Refunds.--The Commission may, upon application of a 
carrier or shipper, permit a common carrier or conference to 
refund a portion of freight charges collected from a shipper or 
to waive the collection of a portion of the charges from a 
shipper if--
         [(1) there is an error in a tariff of a clerical or 
        administrative nature or an error due to inadvertence 
        in failing to file a new tariff and the refund will not 
        result in discrimination among shippers, ports, or 
        carriers;
         [(2) the common carrier or conference has, prior to 
        filing an application for authority to make a refund, 
        filed a new tariff with the Commission that sets forth 
        the rate on which the refund or waiver would be based;
         [(3) the common carrier or conference agrees that if 
        permission is granted by the Commission, an appropriate 
        notice will be published in the tariff, or such other 
        steps taken as the Commission may require that give 
        notice of the rate on which the refund or waiver would 
        be based, and additional refunds or waivers as 
        appropriate shall be made with respect to other 
        shipments in the manner prescribed by the Commission in 
        its order approving the application; and
         [(4) the application for refund or waiver is filed 
        with the Commission within 180 days from the date of 
        shipment.
    [(f) Form. --The Commission may by regulation prescribe the 
form and manner in which the tariffs required by this section 
shall be published and filed. The Commission may reject a 
tariff that is not filed in conformity with this section and 
its regulations. Upon rejection by the Commission, the tariff 
is void and its use is unlawful.]

SEC. 8. COMMON AND CONTRACT CARRIAGE.

    (a) Common Carriage.--
          (1) A common carrier and a conference shall make 
        available a schedule of transportation rates which 
        shall include the rates, terms, and conditions for 
        transportation services not governed by an ocean 
        transportation contract, and shall provide the schedule 
        of transportation rates, in writing, upon the request 
        of any person. A common carrier and a conference may 
        assess a reasonable charge for complying with a request 
        for a rate, term, and condition, except that the charge 
        may not exceed the cost of providing the information 
        requested.
          (2) A dispute between a common carrier or conference 
        and a person as to the applicability of the rates, 
        terms, and conditions for ocean transportation services 
        shall be decided in an appropriate State or Federal 
        court of competent jurisdiction, unless the parties 
        otherwise agree.
          (3) A claim concerning a rate for ocean 
        transportation services which involves false billing, 
        false classification, false weighing, false report of 
        weight, or false measurement shall be decided in an 
        appropriate State or Federal court of competent 
        jurisdiction, unless the parties otherwise agree.
    (b) Contract Carriage.--
          (1) 1 or more common carriers or a conference may 
        enter into an ocean transportation contract with 1 or 
        more shippers. A common carrier may enter into ocean 
        transportation contracts without limitations concerning 
        the number of ocean transportation contracts or the 
        amount of cargo or space involved. The status of a 
        common carrier as an ocean common carrier is not 
        affected by the number or terms of ocean transportation 
        contracts entered.
          (2) A party to an ocean transportation contract 
        entered under this section shall have no duty in 
        connection with services provided under the contract 
        other than the duties specified by the terms of the 
        contract.
          (3)(A) An ocean transportation contract or the 
        transportation provided under that contract may not be 
        challenged in any court on the grounds that the 
        contract violates a provision of this Act.
          (B) The exclusive remedy for an alleged breach of an 
        ocean transportation contract is an action in an 
        appropriate State or Federal court of competent 
        jurisdiction, unless the parties otherwise agree.
          (4) The requirements and prohibitions concerning 
        contracting by conferences contained in sections 
        5(b)(9) and (10) of this Act shall also apply to any 
        agreement among one or more ocean common carriers that 
        is filed under section 5(a) of this Act.

       The change shown below will take effect on January 1, 1998

          (5) A contract entered under this section may be made 
        on a confidential basis, upon agreement of the parties. 
        An ocean common carrier that is a member of a 
        conference agreement may not be prohibited or 
        restricted from agreeing with 1 or more shippers that 
        the parties to the contract will not disclose the 
        rates, services, terms, or conditions of that contract 
        to any other member of the agreement, to the 
        conference, to any other carrier, shipper, conference, 
        or to any other third party.

        The changes shown below will take effect on June 1, 1997

SEC. 9. CONTROLLED CARRIERS.

    (a) Controlled Carrier Rates.--No controlled carrier 
subject to this section may maintain rates or charges [in its 
tariffs or service contracts filed with the Commission] that 
are below a level that is just and reasonable, nor may any such 
carrier establish or maintain unjust or unreasonable 
classifications, rules, or regulations [in those tariffs or 
service contracts]. An unjust or unreasonable classification, 
rules, or regulation means one that results or is likely to 
result in the carriage or handling of cargo at rates or charges 
that are below a just and reasonable level. The Commission may, 
at any time after notice and hearing, disapprove any rates, 
charges, classifications, rules, or regulations that the 
controlled carrier has failed to demonstrate to be just and 
reasonable. In a proceeding under this subsection, the burden 
of proof is on the controlled carrier to demonstrate that its 
rates, charges, classifications, rules, or regulations are just 
and reasonable. Rates, charges, classifications, rates, or 
regulations [filed by a controlled carrier] that have been 
rejected, suspended, or disapproved by the Commission are void 
and their use in unlawful.
    (b) Rate Standards.--For the purpose of this section, in 
determining whether rates, charges, classifications, rules, or 
regulations by a controlled carrier are just and reasonable, 
the Commission may take into account appropriate factors 
including, but not limit to, where--
          (1) the rates or charges which have been [filed] 
        published or which would result from the pertinent 
        classifications, rules, or regulations are below a 
        level which is fully compensatory to the controlled 
        carrier based upon that carrier's actual costs or upon 
        its constructive costs, which are hereby defined as the 
        costs of another carrier, other than a controlled 
        carrier, operating similar vessels and equipment in the 
        same or a similar trade;
          (2) the rates, charges, classifications, rules, or 
        regulations are the same as or similar to those [filed] 
        published or assessed by other carriers in the same 
        trade;
          * * * * * * *
    (c) Effective Date of Rates.--[Notwithstanding section 8(d) 
of this Act, and except for service contracts the rates, 
charges, classifications, rules, or regulations of controlled 
carriers may not, without special permission of the Commission, 
become effective sooner than the 30th day after the date of 
filing with the Commission]. Each controlled carrier shall, 
upon the request of the Commission, file, within 20 days of 
request (with respect to its existing or proposed rates, 
charges, classifications, rules, or regulations), a statement 
of justification that sufficiently details the controlled 
carrier's need and purpose for such rates, charges, 
classifications, rules, or regulations upon which the 
Commission may reasonably based its determination of the 
lawfulness thereof.
    [(d) Disapproval of Rates.--Whenever the Commission is of 
the opinion that the rates, charges, classifications, rules, or 
regulations filed by a controlled carrier may be unjust and 
unreasonable, the Commission may issue an order to the 
controlled carrier to show cause why those rates, charges, 
classifications, rules, or regulations should not be 
disapproved. Pending a determination as to their lawfulness in 
such a proceeding, the Commission may suspend the rates, 
charges, classifications, rules, or regulations at any time 
before their effective data. In the case of rates, charges, 
classifications rules, or regulations that have already become 
effective, the Commission may, upon the issuance of an order to 
show cause, suspend those rates, charges, classifications, 
rules, or regulations on not less than 60 days' notice to the 
controlled carrier. No period of suspension under this 
subsection may be greater than 180 days. Whenever the 
Commission has suspended any rates, charges, classifications, 
rules, or regulations under this subsection, the affected 
carrier may file new rates, charges, classifications, rules, or 
regulations to take effect immediately during the suspension 
period in lieu of the suspended rates, charges, 
classifications, rules, or regulations--except that the 
Commission may reject the new rates, charges, classifications, 
rules, or regulations if it is of the opinion that they are 
unjust and unreasonable.]
    (d) Within 120 days of the receipt of information requested 
by the Secretary under this section, the Secretary shall 
determine whether the rates, charges, classifications, rules, 
or regulations of a controlled carrier may be unjust and 
unreasonable. If so, the Secretary shall issue an order to the 
controlled carrier to show cause why those rates, charges, 
classifications, rules, or regulations should not be approved. 
Pending a determination, the Secretary may suspend the rates, 
charges, classifications, rules or regulations at any time. No 
period of suspension may be greater than 180 days. Whenever the 
Secretary has suspended any rates, charges, classifications, 
rules, or regulations under this subsection, the affected 
carrier may publish and, after notification to the Secretary, 
assess new rates, charges, classifications, rules, or 
regulations--except that the Secretary may reject the new 
rates, charges, classifications, rules, or regulations if the 
Secretary determines that they are unreasonable.
          * * * * * * *
    (f) Exceptions.--[This] Subject to subsection (g), this 
section does not apply to--
          (1) a controlled carrier of a state whose vessels are 
        entitled by a treaty of the United States to receive 
        national or most-favored-nation treatment;
           * * * * * * *
    (g) The rate standards, information submissions, remedies, 
reviews, and penalties in this section shall also apply to 
ocean common carriers that are not controlled, but who have 
been determined by the Secretary to be structurally or 
financially affiliated with nontransportation entities of 
organizations (government or private) in such a way as to 
affect their pricing or marketplace behavior in an unfair, 
predatory, or anticompetitive way that disadvantages an ocean 
common carrier or carriers. The Secretary may make such 
determinations upon request of any person or upon the 
Secretary's own motion, after conducting an investigation and a 
public hearing.
    (h) The Secretary shall issue regulations by June 1, 1997, 
that prescribe the procedures and requirements that would 
govern how price and other information is to be submitted by 
controlled carriers and carriers subject to determinations made 
under subsection (g) when such information would be needed to 
determine whether prices charged by these carriers are unfair, 
predatory, or anticompetitive.
    (i) In any instance where information provided to the 
Secretary under this section does not result in an affirmative 
finding or enforcement action by the Secretary that information 
may not be made public and shall be exempt from disclosure 
under section 552 of title 5, United States Code, except as may 
be relevant to an administrative or judicial action or 
proceeding. This section does not prevent disclosure to either 
body of Congress or to a duly authorized committee or 
subcommittee of Congress.

      The changes shown below will take effect on January 1, 1997

SEC. 10. PROHIBITED ACTS.

    (a) * * *
    (b) Common Carriers.--No common carrier, either alone or in 
conjunction with any other person, directly or indirectly, 
may--
          [(1) charge, demand, collect, or receive greater, 
        less, or different compensation for the transportation 
        of property or for any service in connection therewith 
        than the rates and charges that are shown in its 
        tariffs or service contracts;]
          (1) except for service contracts, subject a person, 
        place, port, or shipper to unreasonable discrimination;
          [(2) rebate, refund, or remit in any manner, or by 
        any device, any portion of its rates except in 
        accordance with its tariffs or service contracts;
          [(3) extend or deny to any person any privilege, 
        concession, equipment, or facility except in accordance 
        with its tariffs or service contracts;
          [(4) allow any person to obtain transportation for 
        property at less than the rates or charges established 
        by the carrier in its tariff or service contract by 
        means of false billing, false classification, false 
        weighing, false measurement, or by any other unjust or 
        unfair device or means;]
          * * * * * * *
          [(8) offer or pay any deferred rebates;
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 10. PROHIBITED ACTS.

    (a)* * *
    [(b) Common Carriers.--No common carrier, either alone or 
in conjunction with any other person, directly or indirectly, 
may--
          [(1) except for service contracts, subject a person, 
        place, port, or shipper to unreasonable discrimination;
          * * * * * * *
          [(5) retaliate against any shipper by refusing, or 
        threatening to refuse, cargo space accommodations whose 
        available, or resort to other unfair or unjustly 
        discriminatory methods because the shipper has 
        patronized another carrier, or has filed a complaint, 
        or for any other reason;
          [(6) except for service contracts, engage in any 
        unfair or unjustly discriminatory practice in the 
        matter of--
                  [(A) rates;
                  [(B) cargo classifications;
                  [(C) cargo space accommodations or other 
                facilities, due regard being had for the proper 
                loading of the vessel and the available 
                tonnage;
                  [(D) the loading and landing of freight; or
                  [(E) the adjustment and settlement of claims;
          [(7) employ any fighting ship;
          * * * * * * *
          [(9) use of loyalty contract, except in conformity 
        with the antitrust laws;
          [(10) demand, charge, or collect any rate or charge 
        that is unjustly discriminatory between shippers or 
        ports;
          [(11) except for services, make or give any undue or 
        unreasonable preference or advantage to any particular 
        person, locality, or description of traffic in any 
        respect whatsoever;
          [(12) subject any particular person, locality, or 
        description of traffic to an unreasonable refusal to 
        deal or any undue or unreasonable prejudice or 
        disadvantage in any respect whatsoever;
          [(13) refuse to negotiate with a shippers' 
        association;
          [(14) knowingly and willfully accept cargo from or 
        transport cargo for the account of a non-vessel-
        operating common carrier that does not have a tariff 
        and a bond, insurance, or other surety as required by 
        sections 8 and 23 of this Act;
          [(15) knowingly and will fully enter into a service 
        contract with a non-vessel-operating common carrier or 
        in which a non-vessel-operating common carrier is 
        listed as an affiliate that does not have a tariff and 
        a bond, insurance, or other surety as required by 
        sections 8 and 23 of this Act; or
          [(16) knowingly disclose, offer, solicit, or receive 
        any information concerning the nature, kind, quantity, 
        destination, consignee, or routing of any property 
        tendered or delivered to a common carrier without the 
        consent of the shipper or consignee if that 
        information--
                  [(A) may be used to the detriment or 
                prejudice of the shipper or consignee;
                  [(B) may improperly disclose its business 
                transaction to a competitor; or
                  [(C) may be used to the detriment or 
                prejudice of any common carrier.
Nothing in paragraph (16) shall be construed to prevent 
providing such information, in response to legal process, to 
the United States, or to an independent neutral body operating 
within the scope of its authority to fulfill the policing 
obligations of the parties to an agreement effective under this 
Act. Nor shall it be prohibited for any ocean common carrier 
that is a party to a conference agreement approved under this 
Act, or any receiver, trustee, lessee, agent, or employee of 
that carrier, or any other person authorized by that carrier to 
receive information, to give information to the conference or 
any person, firm, corporation, or agency designated by the 
conference, or to prevent the conference or its designee from 
soliciting or receiving information for the purpose of 
determining whether a shipper or consignee has breached an 
agreement with the conference or its member lines or for the 
purpose of determining whether a member of the conference has 
breached the conference agreement, or for the purpose of 
compiling statistics of cargo movement, but the use of such 
information for any other purposes prohibited by this Act or 
any other Act is prohibited.]
    (b) Common Carriers.--No common carrier, either alone or in 
conjunction with any other person, directly or indirectly, 
may--
          (1) except for ocean transportation contracts, 
        subject a person, place, port, or shipper to 
        unreasonable discrimination;
          (2) retaliate against any shipper by refusing, or 
        threatening to refuse, cargo space accommodations when 
        available, or resort to other unfair or unjustly 
        discriminatory methods because the shipper has 
        patronized another carrier or has filed a complaint, or 
        for any other reason;
          (3) employ any fighting ship;
          (4) subject any particular person, locality, class, 
        or type of shipper or description of traffic to an 
        unreasonable refusal to deal;
          (5) refuse to negotiate with a shippers' association;
          (6) knowingly and willfully accept cargo from or 
        transport cargo for the account of an ocean freight 
        forwarder that does not have a bond, insurance, or 
        other surety as required by section 19;
          (7) knowingly and willfully enter into an ocean 
        transportation contract with an ocean freight forwarder 
        or in which an ocean freight forwarder is listed as an 
        affiliate that does not have a bond, insurance, or 
        other surety as required by section 19;
          (8)(A) knowingly disclose, offer, solicit, or receive 
        any information concerning the nature, kind, quantity, 
        destination, consignee, or routing of any property 
        tendered or delivered to a common carrier without the 
        consent of the shipper or consignee if that 
        information--
                  (i) may be used to the detriment or prejudice 
                of the shipper or consignee;
                  (ii) may improperly disclose its business 
                transaction to a competitor; or
                  (iii) may be used to the detriment or 
                prejudice of any common carrier;
        except that nothing in this paragraph shall be 
        construed to prevent providing the information, in 
        response to legal process, to the United States, or to 
        an independent neutral body operating within the scope 
        of its authority to fulfill the policing obligations of 
        the parties to an agreement effective under this Act. 
        Nor shall it be prohibited for any ocean common carrier 
        that is a party to a conference agreement approved 
        under this Act, or any receiver, trustee, lessee, 
        agent, or employee of that carrier, or any other person 
        authorized by that carrier to receive information, to 
        give information to the conference or any person, firm, 
        corporation, or agency designated by the conference or 
        to prevent the conference or its designee from 
        soliciting or receiving information for the purpose of 
        determining whether a shipper or consignee has breached 
        an agreement with a conference or for the purpose of 
        determining whether a member of the conference has 
        breached the conference agreement or for the purpose of 
        compiling statistics of cargo movement, but the use of 
        that information for any other purpose prohibited by 
        this Act or any other Act is prohibited; and
          (B) after December 31, 1997, the rates, services, 
        terms, and conditions of an ocean transportation 
        contract may not be disclosed under this paragraph if 
        the contract has been made on a confidential basis 
        under section 8(b) of this Act.
The exclusive remedy for a disclosure under this paragraph 
shall be an action for breach of contract as provided in 
section 8(b)(3) of this Act.
    (c) Concerned Action.--No conference or group of two or 
more common carriers may--
          [(1) boycott, take any concerted action resulting in 
        an unreasonable refusal to deal, or implement a policy 
        or practice that results in an unreasonable refusal to 
        deal;]
          * * * * * * *
          (5) deny in the export foreign commerce of the United 
        States compensation to an ocean freight forwarder as 
        defined in section 3(14)(A) of this Act or limit that 
        compensation to less than a reasonable amount; or
          (6) allocate shippers among specific carriers that 
        are parties to the agreement or prohibit a carrier that 
        is a party to the agreement from soliciting cargo from 
        a particular shipper, except as otherwise required by 
        the law of the United States or the importing or 
        exporting country, or as agreed to by a shipper in [a 
        service] an ocean transportation contract.
    (d) Common Carriers, Ocean Freight Forwarders, and Marine 
Terminal Operators.--
          (1) * * *
          * * * * * * *
          (3) The prohibitions in [subsection] (b) (11), (12), 
        and (16) paragraphs (1), (4), and (8) of subsection (b) 
        of this section apply to marine terminal operators.
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 11. COMPLAINTS, INVESTIGATIONS, REPORTS, AND REPARATIONS.

    (a) * * *
          * * * * * * *
    (g) Reparations.--For any complaint filed within 3 years 
after the cause of action accrued, the Commission shall, upon 
petition of the complainant and after notice and hearing, 
direct payment of reparations to the complainant or counter-
complainant for actual injury (which, for purposes of this 
subsection, also includes the loss of interest at commercial 
rates compounded from the date of injury) caused by a violation 
of this Act plus reasonable attorney's fees. Upon a showing 
that the injury was caused by activity that is prohibited by 
section [10(b) (5) or (7)] 10(b) (2) or (3) or section 10(c) 
(1) or (3) of this Act, or that violates section 10(a) (2) or 
(3), the Commission may direct the payment of additional 
amounts; but the total recovery of a complainant may not exceed 
twice the amount of the actual injury. [In the case of injury 
caused by an activity that is prohibited by section 10(b)(6) 
(A) or (B) of this Act, the amount of the injury shall be the 
difference between the rate paid by the injured shipper and the 
most favorable rate paid by another shipper.]
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 13. PENALTIES.

    (a) * * *
    (b) Additional Penalties.--
          [(1) For a violation of section 10(b) (1), (2), (3), 
        (4), or (8) of this Act, the Commission may suspend any 
        or all tariffs of the common carrier, or that common 
        carrier's right to use any or all tariffs of 
        conferences of which it is a member, for a period not 
        to exceed 12 months.
          [(2) For failure to supply information ordered to be 
        produced or compelled by subpoena under section 12 of 
        this Act, the Commission may, after notice and an 
        opportunity for hearing, suspend any or all tariffs of 
        a common carrier, or that common carrier's right to use 
        any or all tariffs of conferences of which it is a 
        member.
          [(3) A common carrier that accepts or handles cargo 
        for carriage under a tariff that has been suspended or 
        after its right to utilize that tariff has been 
        suspended is subject to a civil penalty of not more 
        than $50,000 for each shipment.]
          (1) If the Secretary finds, after notice and an 
        opportunity for a hearing, that a common carrier has 
        filed to supply information ordered to be produced or 
        compelled by subpoena under section 12 of this Act, the 
        Secretary may request that the Secretary of the 
        Treasury refuse to revoke any clearance required for a 
        vessel operated by that common carrier. Upon request by 
        the Secretary, the Secretary of the Treasury shall, 
        with respect to the vessel concerned, refuse or revoke 
        any clearance required by section 4197 of the Revised 
        Statutes of the United States (46 U.S.C. App. 91).
          [(4)] (2) If, in defense of its failure to comply 
        with a subpena or discovery order, a common carrier 
        alleges that documents or information located in a 
        foreign country cannot be produced before of the laws 
        of that country, the Commission shall immediately 
        notify the Secretary of State of the failure to comply 
        and of the allegation relating to foreign laws. Upon 
        receiving the notification, the Secretary of State 
        shall promptly consult with the government of the 
        nation within which the documents or information are 
        alleged to be located for the purpose of assisting the 
        Commission in obtaining the documents or information 
        sought.
          [(5)] (3) If, after notice and hearing, the 
        Commission finds that the action of a common carrier, 
        acting alone or in concert with any person, or a 
        foreign government has unduly impaired access of a 
        vessel documented under the laws of the United States 
        to ocean trade between foreign ports, the Commission 
        shall take action that it [finds appropriate, including 
        the imposition of any of the penalties authorized under 
        paragraphs (1), (2), and (3) of this subsection] finds 
        appropriate including the imposition of the penalties 
        authorized under paragraph (2).
          [(6)] (4) Before an order under this subsection 
        becomes effective, it shall be immediately submitted to 
        the President who may, within 10 days after receiving 
        it, disapprove the order if the President finds that 
        disapproval is required for reasons of the national 
        defense or the foreign policy of the United States.
          * * * * * * *
    (f) Limitation.--
          (1) No penalty may be imposed on any person for 
        conspiracy to violate section [10(a)(1), (b)(1), or 
        (b)(4)] 10(a)(1) of this Act, or to defraud the 
        Commission by concealment of such a violation.
          * * * * * * *

      The changes shown below will take effect on January 1, 1997

SEC. 15. REPORTS [AND CERTIFICATES].

    [(a) Reports.--]The Commission may require any common 
carrier, or any officer, receiver, trustee, lessee, agent, or 
employee thereof, to file with it any periodical or special 
report or any account, record, rate, or charge, or memorandum 
of any facts and transactions appertaining to the business of 
that common carrier. The report, account, record, rate, charge, 
or memorandum shall be made under oath whenever the Commission 
so requires, and shall be furnished in the form and within the 
time prescribed by the Commission. Conference minutes required 
to be filed with the Commission under this section shall not be 
released to third parties or published by the Commission.
    [(b) Certification.--The Commission shall require the chief 
executive officer of each common carrier and, to the extent it 
deems feasible, may require any shipper, shippers' association, 
marine terminal operator, ocean freight forwarder, or broker to 
file a periodic written certification made under oath with the 
Commission attesting to--
          [(1) a policy prohibiting the payment, solicitation, 
        or receipt of any rebate that is unlawful under the 
        provisions of this Act;
          [(2) the fact that this policy has been promulgated 
        recently to each owner, officer, employee, and agent 
        thereof;
          [(3) the details of the efforts made within the 
        company or otherwise to prevent or correct illegal 
        rebating; and
          [(4) a policy of full cooperation with the Commission 
        in its efforts to end those illegal practices.
Whoever fails to file a certificate required by the Commission 
under this subsection is liable to the United States for a 
civil penalty of not more than $5,000 for each day the 
violation continues.]
          * * * * * * *

 The changes shown below will take effect on the date of the enactment 
                              of this Act

SEC. 17. REGULATIONS.

      [(a)] The Commission may prescribe rules and regulations 
as necessary to carry out this Act.
      [(b)] The Commission may prescribe interim rules and 
regulations necessary to carry out this Act. For this purpose, 
the Commission is excepted from compliance with the notice and 
comment requirements of section 553 of title 5, United States 
Code. All rules and regulations prescribed under the authority 
of this subsection that are not earlier superseded by final 
rules shall expire no later than 270 days after the date of 
enactment of this Act.

 The changes shown below will take effect on the date of the enactment 
                              of this Act

[SEC. 18. AGENCY REPORTS AND ADVISORY COMMISSION.

    [(a) Collection of Data.--For a period of 5 years following 
the enactment of this Act, the Commission shall collect and 
analyze information concerning the impact of this Act upon the 
international ocean shipping industry, including data on:
          [(1) increases or decreases in the level of tariffs;
          [(2) changes in the frequency or type of common 
        carrier services available to specific ports or 
        geographic regions;
          [(3) the number and strength of independent carriers 
        in various trades; and
          [(4) the length of time, frequency, and cost of major 
        types of regulatory proceedings before the Commission.
    [(b) Consultation With Other Departments and Agencies.--The 
Commission shall consult with the Department of Transportation, 
the Department of Justice, and the Federal Trade Commission 
annually concerning data collection. The Department of 
Transportation, the Department of Justice, and the Federal 
Trade Commission shall at all times have access to the data 
collected under this section to enable them to provide comments 
concerning data collection.
    [(c) Agency Reports.--
          [(1) Within 6 months after expiration of the 5-year 
        period specified in subsection (a), the Commission 
        shall report the information, with an analysis of the 
        impact of this Act, to Congress, to the Advisory 
        Commission on Conferences in Ocean Shipping established 
        in subsection (d), and to the Department of 
        Transportation, the Department of Justice, and the 
        Federal Trade Commission.
          [(2) Within 60 days after the Commission submits its 
        report, the Department of Transportation, the 
        Department of Justice, and the Federal Trade Commission 
        shall furnish an analysis of the impact of this Act of 
        Congress and to the Advisory Commission on Conferences 
        in Ocean Shipping.
          [(3) The reports required by this subsection shall 
        specifically address the following topics:
                  [(A) the advisability of adopting a system of 
                tariffs based on volume and mass of shipment;
                  [(B) the need for antitrust immunity for 
                ports and marine terminals; and
                  [(C) the continuing need for the statutory 
                requirement that tariffs be filed with and 
                enforced by the Commission.
    [(d) Establishment and Composition of Advisory 
Commission.--
          [(1) Effective 5\1/2\ years after the date of 
        enactment of this Act, there is established the 
        Advisory Commission on Conferences in Ocean Shipping 
        (hereinafter referred to as the ``Advisory 
        Commission'').
          [(2) The Advisory Commission shall be composed of 17 
        members as follows:
                  [(A) a cabinet level official appointed by 
                the President;
                  [(B) 4 members from the United States Senate 
                appointed by the President pro tempore of the 
                Senate, 2 from the membership of the Committee 
                on Commerce, Science, and Transportation and 2 
                from the membership of the Committee on the 
                Judiciary;
                  [(C) 4 members from the United States House 
                of Representatives appointed by the Speaker of 
                the House, 2 from the membership of the 
                Committee on Merchant Marine and Fisheries, and 
                2 from the membership of the Committee on the 
                Judiciary; and
                  [(D) 8 members from the private sector 
                appointed by the President.
          [(3) The President shall designate the chairman of 
        the Advisory Commission.
          [(4) The term of office for members shall be for the 
        term of the Advisory Commission.
          [(5) A vacancy in the Advisory Commission shall not 
        affect its powers, and shall be filled in the same 
        manner in which the original appointment was made.
          [(6) Nine members of the Advisory Commission shall 
        constitute a quorum, but the Advisory Commission may 
        permit as few as 2 members to hold hearings.
    [(e) Compensation of Members of the Advisory Commission.--
          [(1) Officials of the United States Government and 
        Members of Congress who are members of the Advisory 
        Commission shall serve without compensation in addition 
        to that received for their services as officials and 
        Members, but they shall be reimbursed for reasonable 
        travel, subsistence, and other necessary expenses 
        incurred by them in the performance of the duties 
        vested in the Advisory Commission.
          [(2) Members of the Advisory Commission appointed 
        from the private sector shall each receive compensation 
        not exceeding the maximum per diem rate of pay for 
        grade 18 of the General Schedule under section 5332 of 
        title 5, United States Code, when engaged in the 
        performance of the duties vested in the Advisory 
        Commission, plus reimbursement for reasonable travel, 
        subsistence, and other necessary expenses incurred by 
        them in the performance of those duties, 
        notwithstanding the limitations in sections 5701 
        through 5733 of title 5, United States Code.
          [(3) Members of the Advisory Commission appointed 
        from the private sector are not subject to section 208 
        of title 18, United States Code. Before commencing 
        service, these members shall file with the Advisory 
        Commission a statement disclosing their financial 
        interests and business and former relationships 
        involving or relating to ocean transportation. These 
        statements shall be available for public inspection at 
        the Advisory Commission's offices.
    [(f) Advisory Commission Functions.--The Advisory 
Commission shall conduct a comprehensive study of, and make 
recommendations concerning, conferences in ocean shipping. The 
study shall specifically address whether the Nation would be 
best served by prohibiting conferences, or by closed or open 
conferences.
    [(g) Powers of the Advisory Commission.--
          [(1) The Advisory Commission may, for the purpose of 
        carrying out it functions, hold such neraings and sit 
        and act at such times and places, administer such 
        oaths, and require, by subpena of otherwise, the 
        attendance and testimony of such witnesses, and the 
        production of such books, records, correspondence, 
        memorandums, papers, and documents as the Advisory 
        Commission may deem advisable. Subpenas may be issued 
        to any deem advisable. Subpenas may be issued to any 
        person within the jurisdiction of the United States 
        courts, under the signature of the chairman, or any 
        duly designated member, and may be served by any person 
        designated by the chairman, or that member. In case of 
        contumacy by, or refusal to obey a subpena to, any 
        person, the Advisory Commission may advise the Attorney 
        General who shall invoke the aid of any court of the 
        United States within the jurisdiction of which the 
        Advisory Commission's proceedings are carried on, or 
        where that person resides or carries on business, in 
        requiring the attendance and testimony of witnesses and 
        the production of books, papers, and documents; and the 
        court may issues an order requiring that person to 
        appear before the Advisory Commission, there to produce 
        records, if so ordered, or to give testimony. A failure 
        to obey such an order of the court may be punished by 
        the court as a contempt thereof. All process in any 
        such case may be served in the judicial district 
        whereof the person in an inhabitant or may be found.
          [(2) Each department, agency, and instrumentality of 
        the executive branch of the Government, including 
        independent agencies, shall furnish to the Advisory 
        Commission, upon request made by the chairman, such 
        information as the Advisory Commission deems necessary 
        to carry out its functions.
          [(3) Upon request of the chairman, the Department of 
        Justice, the Department of Transportation, the Federal 
        Maritime Commission and the Federal Trade Commission 
        shall detail staff personnel as necessary to assist the 
        Advisory Commission.
          [(4) The chairman may rent office space for the 
        Advisory Commission, may utilize the services and 
        facilities of other Federal agencies with or without 
        reimbursement, may accept voluntary services not-
        withstanding section 1342 of title 31, United States 
        Code, may accept, hold, and administer gifts from other 
        Federal agencies, and may enter into contracts with any 
        public or private person or entity for reports, 
        research, or surveys in furtherance of the work of the 
        Advisory Commission.
    [(h) Final Report.--The Advisory Commission shall, within 1 
year after all of its members have been duly appointed, submit 
to the President and to the Congress a final report containing 
a statement of the findings and conclusions of the Advisory 
Commission resulting from the study undertaken under subsection 
(f), including recommendations for such administrative, 
judicial, and legislative action as it deems advisable. Each 
recommendation made by the Advisory Commission to the President 
and to the Congress must have the majority vote of the Advisory 
Commission present and voting.
    [(i) Expiration of the Commission.--The Advisory Commission 
shall cease to exist 30 days after the submission of its final 
report.
    [(j) Authorization of Appropriation.--There is authorized 
to be appropriated $500,000 to carry out the activities of the 
Advisory Commission.]

        The changes shown below will take effect on June 1, 1997

SEC. 19. OCEAN FREIGHT FORWARDERS.

    [(A) License.--No person may act as an ocean freight 
forwarder unless that person holds a license issued by the 
Commission. The Commission shall issue a forwarder's license to 
any person that--
          [(1) the Commission determines to be qualified by 
        experience and character to render forwarding services; 
        and
          [(2) furnished a bond in a form and amount determined 
        by the Commission to insure financial responsibility 
        that is issued by a surety company found acceptable by 
        the Secretary of the Treasury.]
    (a) License.--No person in the United States may act as an 
ocean freight forwarder unless that person holds a license 
issued by the Commission. The Commission shall issue a 
forwarder's license to any person that the Commission 
determines to be qualified by experience and character to 
render forwarding services.
    (b) Financial Responsibility.--
          (1) No person may act as an ocean freight forwarder 
        unless that person furnishes a bond, proof of 
        insurance, or other surety in a form and amount 
        determined by the Commission to insure financial 
        responsibility that is issued by a surety company found 
        acceptable by the Secretary of the Treasury.
          (2) A bond, insurance, or other surety obtained 
        pursuant to this section shall be available to pay any 
        judgment for damages against an ocean freight forwarder 
        arising from its transportation-related activities 
        under this Act or order for reparation issued pursuant 
        to section 11 or 14 of this Act.
          (3) An ocean freight forwarder not domiciled in the 
        United States shall designated a resident agent in the 
        United States for receipt of service of judicial and 
        administrative process, including subpoenas.
    [b] (c) Suspension or Revocation.--The Commission shall, 
after notice and hearing, suspend or revoke a license if it 
finds that the ocean freight forwarder is not qualified to 
render forwarding services or that it willfully failed to 
comply with a provision of this Act or with a lawful order, 
rule, or regulation of the Commission. The Commission may also 
revoke a forwarder's license for failure to maintain [a bond in 
accordance with subsection (a)(2).] bond, proof of insurance, 
or other surety in accordance with subsection (b)(1).
          [c] (d) Exception.--A person whose primary business 
        is the sale of merchandise may forward shipments of the 
        merchandise for its own account without a license.
          [d] (e) Compensation of Forwarders By Carriers.--
          (1) A common carrier may compensate an ocean freight 
        forwarder in connection with a shipment dispatched on 
        behalf of others only when the ocean freight forwarder 
        has certified in writing that it holds a valid license 
        and has performed the following services:
                  (A) Engaged, booked, secured, reserved, or 
                contracted directly with the carrier or its 
                agent for space aboard a vessel or confirmed 
                the availability of that space.
                  (B) Prepared and processed the ocean bill of 
                lading, dock receipt, or other similar document 
                with respect to the shipment.
          (2) No common carrier may pay compensation for 
        services described in paragraph (1) more than once on 
        the same shipment.
          [(3) No compensation may be paid to an ocean freight 
        forwarder except in accordance wit the tariff 
        requirements of this Act.
          [(4) (3) No ocean freight forwarder may receive 
        compensation from a common carrier with respect to a 
        shipment in which the forwarder has a direct or 
        indirect beneficial interest nor shall a common carrier 
        knowingly pay compensation on that shipment.
          (4) No conference or group of 2 or more ocean common 
        carriers in the foreign commerce of the United States 
        that is authorized to agree upon the level of 
        compensation paid to an ocean freight forwarder, as 
        defined in section 3(18)(A) of this Act, may--
                  (A) deny to any member of the conference or 
                group the right, upon notice of not more than 3 
                business days, to take independent action on 
                any level of compensation paid to an ocean 
                freight forwarder; or
                  (B) agree to limit the payment of 
                compensation to an ocean freight forwarder, as 
                defined in section 3(18)(A) of this Act, to 
                less than 1.25 percent of the aggregate of all 
                rates and charges which are applicable under a 
                common schedule of transportation rates 
                provided under section 8(a) of this Act, and 
                which are assessed against the cargo on which 
                the forwarding services or provided.

SEC. 20. REPEALS AND CONFORMING AMENDMENTS.

          * * * * * * *
    [(e) Savings Provisions.--
          [(1) Each service contract entered into by a shipper 
        and an ocean common carrier or conference before the 
        date of enactment of this Act may remain in full force 
        and effect and need not comply with the requirements of 
        section 8(c) of this Act until 15 months after the date 
        of enactment of this Act.
          [(2) This Act and the amendments made by it shall not 
        affect any suit--
                  [(A) filed before the date of enactment of 
                this Act; or
                  [(B) with respect to claims arising out of 
                conduct engaged in before the date of enactment 
                of this Act, filed within 1 year after the date 
                of enactment of this Act.]
    (e) Savings Provisions.--
          (1) Each service contract entered into by a shipper 
        and an ocean common carrier or conference before the 
        date of enactment of the Ocean Shipping Reform Act of 
        1995 may remain in full force and effect according to 
        its term.
          (2) This Act and the amendments made by this Act 
        shall not affect any suit--
                  (A) filed before the date of enactment of the 
                Ocean Shipping Reform Act of 1995;
                  (B) with respect to claims arising out of 
                conduct engaged in before the date of enactment 
                of the Ocean Shipping Reform Act of 1995, filed 
                within 1 year after the date of enactment of 
                the Ocean Shipping Reform Act of 1995;
                  (C) with respect to claims arising out of 
                conduct engaged in after the date of enactment 
                of the Ocean Shipping Reform Act of 1995 but 
                before January 1, 1997, pertaining to a 
                violation of section 10(b) (1), (2), (3), (4), 
                or (8), as in effect before January 1, 1997, 
                filed by June 1, 1997;
                  (D) with respect to claims pertaining to the 
                failure of a common carrier or conference to 
                file its tariffs or service contracts in 
                accordance with this Act in the period 
                beginning January 1, 1997, and ending June 1,1 
                997, filed by December 31, 1997; or
                  (E) with respect to claims arising out of 
                conduct engaged in on or after the date of the 
                enactment of the Ocean Shipping Reform Act of 
                1995 but before June 1, 1997, filed by December 
                31, 1997.
          * * * * * * *

        The changes shown below will take effect on June 1, 1997

SEC. 23. SURETY FOR NON-VESSEL-OPERATING COMMON CARRIERS.

    [(a) Surety.--Each non-vessel operating common carrier 
shall furnish the Commission a bond, proof of insurance, or 
such other surety, as the Commission may require, in a form and 
an amount determined by the Commission to be satisfactory to 
insure the financial responsibility of that carrier. Any bond 
submitted pursuant to this section shall be issued by a surety 
company found acceptable by the Secretary of the Treasury.
    [(b) Claims Against Surety.--A bond, insurance, or other 
surety obtained pursuant to this section shall be available to 
pay any judgment for damages against a non-vessel-operating 
common carrier arising from its transportation-related 
activities under this Act or order for reparations issued 
pursuant to section 11 of this Act or any penalty assessed 
against a non-vessel-operating carrier pursuant to section 13 
of this Act.
    [(c) Resident Agent.--A non-vessel-operating common carrier 
not domiciled in the United States shall designate a resident 
agent in the United States for receipt of service of judicial 
and administrative process, including subpoenas.
    [(d) Tariffs.--The Commission may suspend or cancel any or 
all tariffs of a non-vessel-operating common carrier for 
failure to maintain the bond, insurance, or other surety 
required by subsection (a) of this section or to designate an 
agent as required by subsection (c) of this section or for a 
violation of section 10(a)(1) of this Act.]
                              ----------                              


        The changes shown below will take effect on June 1, 1997

SEC. 24. MARINE TERMINAL OPERATOR SCHEDULES.

    A marine terminal operator shall make available to the 
public a schedule of rates, regulations, and practices, 
including limitations of liability, pertaining to receiving, 
delivering, handling, or storing property at its marine 
terminal. The schedule shall be enforceable as an implied 
contract, without proof of actual knowledge of its provisions, 
for any activity by the marine terminal operator that is taken 
to--
          (1) efficiently transfer property between 
        transportation modes;
          (2) protect property from damage or loss;
          (3) comply with any governmental requirement; or
          (4) store property in excess of the terms of any 
        other contract or agreement, if any, entered into by 
        the marine terminal operator.
                              ----------                              


    SECTION 502 OF THE HIGH SEAS DRIFTNET FISHERIES ENFORCEMENT ACT

        The change shown below will take effect on June 1, 1997

[SEC. 502. AUTOMATED TARIFF FILING AND INFORMATION SYSTEM.

  [(a) Definitions.--In this section, the following definitions 
apply:
          [(1) Commission.--The term ``Commission'' means the 
        Federal Maritime Commission.
          [(2) Common carrier.--The term ``common carrier'' 
        means a common carrier under section 3 of the Shipping 
        Act of 1984 (46 App. U.S.C. 1702), a common carrier by 
        water in interstate commerce under the Shipping Act, 
        1916 (46 App. U.S.C. 801 et seq.), or a common carrier 
        by water in intercoastal commerce under the 
        Intercoastal Shipping Act, 1933 (46 App. U.S.C. 843 et 
        seq.).
          [(3) Conference.--The term ``conference'' has the 
        meaning given that term under section 3 of the Shipping 
        Act of 1984 (46 App. U.S.C. 1702).
          [(4) Essential terms of service contracts.--The term 
        ``essential terms of service contracts'' means the 
        essential terms that are required to be filed with the 
        Commission and made available under section 8(c) of the 
        Shipping Act of 1984 (46 App. U.S.C. 1707(c)).
          [(5) Tariff.--The term ``tariff'' means a tariff of 
        rates, charges, classifications, rules, and practices 
        required to be filed by a common carrier or conference 
        under section 8 of the Shipping Act of 1984 (46 App. 
        U.S.C. 1707), or a rate, fare, charge, classification, 
        rule, or regulation required to be filed by a common 
        carrier or conference under the Shipping Act, 1916 (46 
        U.S.C. 801 et seq.), or the Intercoastal Shipping Act, 
        1933 (46 App. U.S.C. 843 et seq.).
  [(b) Tariff Form and Availability.--
          [(1) Requirement to file.--Notwithstanding any other 
        law, each common carrier and conference shall, in 
        accordance with subsection (c), file electronically 
        with the Commission all tariffs, and all essential 
        terms of service contracts, required to be filed by 
        that common carrier or conference under the Shipping 
        Act of 1984 (46 App. U.S.C. 1701 et seq.), the Shipping 
        Act, 1916 (46 App. U.S.C. 801 et seq.), and the 
        Intercoastal Shipping Act, 1933 (46 App. U.S.C. 843 et 
        seq.).
          [(2) Availability of information.--The Commission 
        shall make available electronically to any person, 
        without time, quantity, or other limitation, both at 
        the Commission headquarters and through appropriate 
        access from remote terminals--
                  [(A) all tariff information, and all 
                essential terms of service contracts, filed in 
                the Commission's Automated Tariff Filing and 
                Information System database; and
                  [(B) all tariff information in the System 
                enhanced electronically by the Commission at 
                any time.
  [(c) Filing Schedule.--New tariffs and new essential terms of 
service contracts shall be filed electronically not later than 
July 1, 1992. All other tariffs, amendments to tariffs, and 
essential terms of service contracts shall be filed not later 
than September 1, 1992.
  [(d) Fees.--
          [(1) Amount of fee.--The Commission shall charge, 
        beginning July 1 of fiscal year 1992 and in fiscal 
        years 1993, 1994, and 1995--
                  [(A) a fee of 46 cents for each minute of 
                remote computer access by any individual of the 
                information available electronically under this 
                section; and
                  [(B)(i) for electronic copies of the 
                Automated Tariff Filing and Information System 
                database (in bulk), or any portion of the 
                database, a fee reflecting the cost of 
                providing those copies, including the cost of 
                duplication, distribution, and user-dedicated 
                equipment; and
                  [(ii) for a person operating or maintaining 
                information in a database that has multiple 
                tariff or service contract information obtained 
                directly or indirectly from the Commission, a 
                fee of 46 cents for each minute that database 
                is subsequently accessed by computer by any 
                individual.
          [(2) Exemption for federal agencies.--A Federal 
        agency is exempt from paying a fee under this 
        subsection.
  [(e) Enforcement.--The Commission shall use systems controls 
or other appropriate methods to enforce subsection (d).
  [(f) Penalties.--
          [(1) Civil penalties.--A person failing to pay a fee 
        established under subsection (d) is liable to the 
        United States Government for a civil penalty of not 
        more than $5,000 for each violation.
          [(2) Criminal penalties.--A person that willfully 
        fails to pay a fee established under subsection (d) 
        commits a class A misdemeanor.
  [(g) Automatic Filing Implementation.--
          [(1) Certification of software.--Software that 
        provides for the electronic filing of data in the 
        Automated Tariff Filing and Information System shall be 
        submitted to the Commission for certification. Not 
        later than fourteen days after a person submits 
        software to the Commission for certification, the 
        Commission shall--
                  [(A) certify the software if it provides for 
                the electronic filing of data; and
                  [(B) publish in the Federal Register notice 
                of that certification.
          [(2) Repayable advance.--
                  [(A) Availability and use of advance.--Upon 
                the date of enactment of this Act, the 
                Secretary of the Treasury shall make available 
                to the Commission, as a repayable advance, not 
                more than $4,000,000, to remain available until 
                expended. The Commission shall spend these 
                funds to complete and upgrade the capacity of 
                the Automated Tariff Filing and Information 
                System to provide access to information under 
                this section.
                  [(B) Requirement to repay.--
                          [(i) In general.--Any advance made to 
                        the Commission under subparagraph (A) 
                        shall be repaid, with interest, to the 
                        general fund of the Treasury not later 
                        than September 30, 1995.
                          [(ii) Interest.--Interest on any 
                        advance made to the Commission under 
                        subparagraph (A)--
                                  [(I) shall be at a rate 
                                determined by the Secretary of 
                                the Treasury, as of the close 
                                of the calendar month preceding 
                                the month in which the advance 
                                is made, to be equal to the 
                                current average market yield on 
                                outstanding marketable 
                                obligations of the United 
                                States with remaining periods 
                                to maturity comparable to the 
                                anticipated period during which 
                                the advance will be 
                                outstanding; and
                                  [(II) shall be compounded 
                                annually.
          [(3) Use of retained amounts.--Out of amounts 
        collected by the Commission under this section, amounts 
        shall be retained and expended by the Commission for 
        each fiscal year, without fiscal year limitation, to 
        carry out this section and pay back the Secretary of 
        the Treasury for the advance made available under 
        paragraph (2).
          [(4) Deposit in treasury.--Except for the amounts 
        retained by the Commission under paragraph (3), fees 
        collected under this section shall be deposited in the 
        general fund of the Treasury as offsetting receipts.
  [(h) Restriction.--No fee may be collected under this section 
after fiscal year 1995.
  [(i) Conforming Amendment.--Section 2 of the Act of August 
16, 1989 (46 App. U.S.C. 1111c), is repealed.]
                              ----------                              


      SECTION 10002 OF THE FOREIGN SHIPPING PRACTICES ACT OF 1988

                 TITLE X--OCEAN AND AIR TRANSPORTATION

                 Subtitle A--Foreign Shipping Practices

SEC. 10001. SHORT TITLE.

  This subtitle may be cited as the ``Foreign Shipping 
Practices Act of 1988''.

        The change shown below will take effect on June 1, 1997

SEC. 10002. FOREIGN LAWS AND PRACTICES.

  (a) Definitions.--For purposes of this section--
          (1) ``common carrier'', ``marine terminal operator'', 
        [``non-vessel-operating common carrier'',] ``ocean 
        common carrier'', ``ocean freight forwarder'', 
        ``person'', ``shipper'', ``shippers' association'', and 
        ``United States'' have the meanings given each such 
        term, respectively, in section 3 of the Shipping Act of 
        1984 (46 App. U.S.C. 1702);
          * * * * * * *
          (4) ``maritime-related services'' means intermodal 
        operations, terminal operations, cargo solicitation, 
        forwarding and agency services, [non-vessel-operating 
        common carrier operations,] and all other activities 
        and services integral to total transportation systems 
        of ocean common carriers and their foreign domiciled 
        affiliates on their own and others' behalf;
          * * * * * * *
  (e) Action Against Foreign Carriers.--(1) Whenever, after 
notice and opportunity for comment or hearing, the Commission 
determines that the conditions specified in subsection (b) of 
this section exist, the Commission shall take such action as it 
considers necessary and appropriate against any foreign carrier 
that is a contributing cause to, or whose government is a 
contributing cause to, such conditions, in order to offset such 
conditions. Such action may include--
          (A) limitations on sailings to and from United States 
        ports or on the amount or type of cargo carried;
          [(B) suspension, in whole or in part, of any or all 
        tariffs filed with the Commission, including the right 
        of an ocean common carrier to use any or all tariffs of 
        conferences in United States trades of which it is a 
        member for such period as the Commission specifies;
          [(C) suspension, in whole or in part, of the right of 
        an ocean common carrier to operate under any agreement 
        filed with the Commission, including agreements 
        authorizing preferential treatment at terminals, 
        preferential terminal leases, space chartering, or 
        pooling of cargo or revenues with other ocean common 
        carriers; and
          [(D) a fee, not to exceed $1,000,000 per voyage.]
          (B) suspension, in whole or in part, of the right of 
        an ocean common carrier to operate under any agreement 
        filed with the Secretary, including agreements 
        authorizing preferential treatment at terminals, 
        preferential terminal leases, space chartering, or 
        pooling of cargo or revenues with other ocean common 
        carriers; and
          (C) a fee, not to exceed $1,000,000 per voyage.
          * * * * * * *
  (h) The actions against foreign carriers authorized in 
subsections (e) and (f) of this section may be used in the 
administration and enforcement of [section 13(b)(5) of the 
Shipping Act of 1984 (46 App. U.S.C. 1712(b)(5))] section 
13(b)(2) of the Shipping Act of 1984 (46 App. U.S.C. 
1712(b)(2)) or section 19(1)(b) of the Merchant Marine Act, 
1920 (46 App. U.S.C. 876).
          * * * * * * *
                              ----------                              


                SECTION 36 OF THE ACT OF AUGUST 5, 1909

CHAP. 6.--An Act To provide revenue, equalize duties and encourage the 
        industries of the United States, and for other purposes.

  Sec. 36. That a tonnage duty of 9 cents per ton, not to 
exceed in the aggregate 45 cents per ton in any one year, [for 
fiscal years 1991, 1992, 1993, 1994, 1995, 1996, 1997, 1998,] 
for fiscal years through fiscal year 2002, and 2 cents per ton, 
not to exceed in the aggregate 10 cents per ton in any one 
year, for each fiscal year thereafter is hereby imposed at each 
entry on all vessels which shall be entered in any port of the 
United States from any foreign port or place in North America, 
Central America, the West India Islands, the Bahama Islands, 
the Bermuda Islands, or the coast of South America bordering on 
the Caribbean Sea, or Newfoundland, and on all vessels (except 
vessels of the United States, recreational vessels, and barges, 
as those terms are defined in section 2101 of title 46, United 
States Code) that depart a United States port or place and 
return to the same port or place without being entered in the 
United States from another port or place; and a duty of 27 
cents per ton, not to exceed $1.35 per ton per annum, for 
[fiscal years 1991, 1992, 1993, 1994, 1995, 1996, 1997, 1998,] 
for fiscal years through fiscal year 2002, and 6 cents per ton, 
not to exceed 30 cents per ton per annum, for each fiscal year 
thereafter is hereby imposed at each entry on all vessels which 
shall be entered in any port of the United States from any 
other foreign port. However, neither duty shall be imposed on 
vessels in distress or not engaged in trade.
          * * * * * * *
                              ----------                              


                          ACT OF MARCH 8, 1910

    CHAP. 86.--An Act Concerning tonnage duties on vessels entering 
                         otherwise than by sea.

  Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled, That 
vessels entering otherwise than by sea from a foreign port at 
which tonnage or light-house dues or other equivalent tax or 
taxes are not imposed on vessels of the United States shall be 
exempt from the tonnage duty of 9 cents per ton, not to exceed 
in the aggregate 45 cents per ton in any one year, [for fiscal 
years 1991, 1992, 1993, 1994, 1995, 1996, 1997, and 1998,] for 
fiscal years through fiscal year 2002, and 2 cents per ton, not 
to exceed in the aggregate 10 cents per ton in any one year, 
for each fiscal year thereafter, prescribed by section thirty-
six of the Act approved August fifth, nineteen hundred and 
nine, entitled, ``An Act to provide revenue, equalize duties, 
and encourage the industries of the United States, and for 
other purposes.''
                              ----------                              


           PUBLIC WORKS AND ECONOMIC DEVELOPMENT ACT OF 1965

 AN ACT To provide grants for public works and development facilities, 
 other financial assistance and the planning and coordiation needed to 
  alleviate conditions of substantial and persistent unemployment and 
      underemployment in economically distressed areas and regions

  Be it enacted by the Senate and House of Representatives of 
the United States of America in Congress assembled. That this 
Act may be cited as the ``Public Works and Economic Development 
Act of 1965''.

                         [statement of purpose

  [Sec. 2. The Congress declares that the maintenance of the 
national economy at a high level is vital to the best interests 
of the United States, but that some of our regions, counties, 
and communities are suffering substantial and persistent 
unemployment cause hardship to many individuals and their 
families, and waste invaluable human resources; that to 
overcome this problem the Federal Government, in cooperation 
with the States, should help areas and regions of substantial 
and persistent unemployment and underemployment to take 
effective steps in planning and financing their public works 
and economic development; that Federal financial assistance, 
including grants for public works and development facilities to 
communities, industries, enterprises, and individuals in areas 
needing development should enable such areas to help themselves 
achieve lasting improvement and enhance the domestic prosperity 
by the establishment of stable and diversified local economies 
and improved local conditions, provided that such assistant is 
preceded by and consistent with sound, long-range economic 
planning; and that under the provisions of this Act new 
employment opportunities should be created by developing and 
expanding new and existing public works and other facilities 
and resources rather than by merely transferring jobs from one 
area of the United States to another. Congress further declares 
that, in furtherance of maintaining the national economy at a 
high level, the assistance authorized by this Act should be 
made available to both rural and urban areas; that such 
assistance be available for planning for economic development 
prior to the actual occurrences of economic distress in order 
to avoid such condition; and that such assistance be used for 
long-term economic rehabilitation in areas where long-term 
economic deterioration has occurred or is taking place.

      [TITLE I--GRANTS FOR PUBLIC WORKS AND DEVELOPMENT FACILITIES

  [Sec. 101. (a) Upon the application of any State, or 
political subdivision thereof, Indian tribe, or private or 
public nonprofit organization or association representing any 
redevelopment area or part thereof, the Secretary of Commerce 
(hereinafter referred to as the Secretary) is authorized--
          [(1) to make direct grants for the acquisition or 
        development of land and improvements for public works, 
        public service, or development facility usage, and the 
        acquisition, construction, rehabilitation, alteration, 
        expansion, or improvement of such facilities, including 
        related machinery and equipment, within a redevelopment 
        area, if he finds that--
                  [(A) the project for which financial 
                assistance is sought will directly or 
                indirectly (i) tend to improve the 
                opportunities, in the area where such project 
                is or will be located, for the successful 
                establishment or expansion of industrial or 
                commercial plants or facilities, (ii) otherwise 
                assist in the creation of additional long-term 
                employment opportunities for such area, or 
                (iii) primarily benefit the long-term 
                unemployed and members of low-income families 
                or otherwise substantially further the 
                objectives of the Economic Opportunity Act of 
                1964;
                  [(B) the project for which a grant is 
                requested will fulfill a pressing need of the 
                area, or part thereof, in which it is, or will 
                be, located;
                  [(C) the area for which a project is to be 
                undertaken has an approved overall economic 
                development program as provided in section 
                202(b)(10) and such project is consistent with 
                such program; and
                  [(D) in the case of a redevelopment area so 
                designated under section 401(a)(6), the project 
                to be undertaken will provide immediate useful 
                work to unemployed and underemployed persons in 
                that area.
          [(2) to make supplementary grants in order to enable 
        the States and other entities within redevelopment 
        areas to take maximum advantage of designated Federal 
        grant-in-aid programs (as here-inafter defined), direct 
        grants-in-aid authorized under this section, and 
        Federal grant-in-aid programs authorized by the 
        Watershed Protection and Flood Prevention Act (68 Stat. 
        666, as amended), and the eleven watersheds authorized 
        by the Flood Control Act of December 22, 1944, as 
        amended and supplemented (58 Stat. 887), for which they 
        are eligible but for which, because of their economic 
        situation, they cannot supply the required matching 
        share.
  [(b) Subject to subsection (c) hereof, the amount of any 
direct grant under this section for any project shall not 
exceed 50 per centum of the cost of such project.
  [(c) The amount of any supplementary grant under this section 
for any project shall not exceed the applicable percentage 
established by regulations promulgated by the Secretary, but in 
no event shall the non-Federal share of the aggregate cost of 
any such project (including assumptions of debt) be less than 
20 per centum of such cost, except that in the case of a grant 
to an Indian tribe, the Secretary may reduce the non-Federal 
share below such per centum or may waive the non-Federal share. 
In the case of any State or political subdivision thereof which 
the Secretary determines has exhausted its effective taxing and 
borrowing capacity, the Secretary shall reduce the non-Federal 
share below such per centum or shall waive the non-Federal 
share in the case of such a grant for a project in a 
redevelopment area designated as such under section 401(a)(6) 
of this Act. In case of any community development corporation 
which the Secretary determines has exhausted its effective 
borrowing capacity, the Secretary may reduce the non-Federal 
share below such per centum or waive the non-Federal share in 
the case of such a grant for a project in a redevelopment area 
designated as such under section 401(a)(6) of this Act. 
Supplementary grants shall be made by the Secretary, in 
accordance with such regulations as he shall prescribe, by 
increasing the amounts of direct grants authorized under this 
section or by the payment of funds appropriated under this Act 
to the heads of the departments, agencies, and 
instrumentalities of the Federal Government responsible for the 
administration of the applicable Federal programs. 
Notwithstanding any requirement as to the amount or sources of 
non-Federal funds that may otherwise be applicable to the 
Federal program involved, funds provided under this subsection 
shall be used for the sole purpose of increasing the Federal 
contribution to specific projects in redevelopment areas under 
such programs above the fixed maximum portion of the cost of 
such project otherwise authorized by the applicable law. The 
term ``designated Federal grant-in-aid programs,'' as used in 
this subsection, means such existing or future Federal grant-
in-aid programs assisting in the construction or equipping of 
facilities as the Secretary may, in furtherance of the purposes 
of this Act, designate as eligible for allocation of funds 
under this section. In determining the amount of any 
supplementary grant available to any project under this 
section, the Secretary shall take into consideration the 
relative needs of the area, the nature of the projects to be 
assisted, and the amount of such fair user charges or other 
revenues as the project may reasonably be expected to generate 
in excess of those which would amortize the local share of 
initial costs and provide for its successful operation and 
maintenance (including depreciation).
  [(d) The Secretary shall prescribe rules, regulations, and 
procedures to carry out this section which will assure that 
adequate consideration is given to the relative needs of 
eligible areas. In prescribing such rules, regulations, and 
procedures the Secretary shall consider among other relevant 
factors first, the severity of the rates of unemployment in the 
eligible areas and the duration of such unemployment and 
second, the income levels of families and the extent of 
underemployment in eligible areas.
  [(f) The Secretary shall prescribe regulations which will 
assure that appropriate local governmental authorities have 
been given a reasonable opportunity to review and comment upon 
proposed projects under this section.
  [Sec. 102. For each of the fiscal years ending June 30, 1975, 
June 30, 1976, September 30, 1977, September 30, 1978, 
September 30, 1979, September 30, 1980, September 30, 1981, and 
September 30, 1982, not to exceed $30,000,000 of the funds 
authorized to be appropriated under section 105 of this Act for 
each such fiscal year, and for the period beginning July 1, 
1976, and ending September 30, 1976, not to exceed $7,500,000 
of the funds authorized to be appropriated under such section 
105 for such period, shall be available for grants for 
operation of any health project funded under this title after 
the date of enactment of this section. Such grants may be made 
up to 100 per centum of the estimated cost of the first year of 
operation, and up to 100 per centum of the deficit in funds 
available for operation of the facility during the second 
fiscal year of operation. No grant shall be made for the second 
fiscal year of operation of any facility unless the agency 
operating such facility has adopted a plan satisfactory to the 
Secretary of Health, Education, and Welfare, providing for the 
funding of operations on a permanent basis. Any grant under 
this section shall be made upon the condition that the 
operation of the facility will be conducted under efficient 
management practices designed to obviate operating deficits, as 
determined by the Secretary of Health, Education, and Welfare.
  [Sec. 103. Not more than 15 per centum of the appropriations 
made pursuant to this title may be expended in any one State.
  [Sec. 105. There is hereby authorized to be appropriated to 
carry out this title not to exceed $500,000,000 for the fiscal 
year ending June 30, 1966, and for each fiscal year thereafter 
through fiscal year ending June 30, 1971, not to exceed 
$800,000,000 per fiscal year for the fiscal years ending June 
30, 1972, and June 30, 1973, not to exceed $200,000,000 for the 
fiscal year ending June 30, 1974, and not to exceed 
$200,000,000 for the fiscal year ending June 30, 1975, and not 
to exceed $250,000,000 for the fiscal year ending June 30, 
1976, not to exceed $62,500,000 for the period beginning July 
1, 1976, and ending September 30, 1976, and not to exceed 
$425,000,000 per fiscal year for the fiscal years ending 
September 30, 1977, September 30, 1978, September 30, 1979, 
September 30, 1980, and September 30, 1981, and not to exceed 
$150,000,000 for the fiscal year ending September 30, 1982. Any 
amounts authorized for the fiscal year ending June 30, 1972, 
under this section but not appropriated may be appropriated for 
the fiscal year ending June 30, 1973. Not less than 25 per 
centum nor more than 35 per centum of all appropriations made 
for the fiscal years ending June 30, 1972, June 30, 1973, and 
June 30, 1974, and not less than 15 per centum nor more than 35 
per centum of all appropriations made for the fiscal years 
ending June 30, 1975 and June 30, 1976, the period beginning 
July 1, 1976, and ending September 30, 1976, and the fiscal 
years ending September 30, 1977, September 30, 1978, September 
30, 1979, September 30, 1980, September 30, 1981, and September 
30, 1982, under authority of the preceding sentences shall be 
expended in redevelopment areas designated as such under 
section 401(a)(6) of this Act.

               [financial assistance for sewer facilities

  [Sec. 106. No financial assistance, through grants, loans, 
guarantees, or otherwise, shall be made under this Act to be 
used directly or indirectly for sewer or other waste disposal 
facilities unless the Secretary of Health, Education, and 
Welfare certifies to the Secretary that any waste material 
carried by such facilities will be adequately treated before it 
is discharged into any Public waterway so as to meet applicable 
Federal, State, interstate, or local water quality standards.

                      [construction cost increases

  [Sec. 107. In any case where a grant (including a 
supplemental grant) has been made under this title for a 
project and after such grant has been made but before 
completion of the project, the cost of such project based upon 
the designs and specifications which were the basis of the 
grant has been increased because of increases in costs, the 
amount of such grant may be increased by an amount equal to the 
percentage increase, as determined by the Secretary, in such 
costs, but in no event shall the percentage of the Federal 
share of such project exceed that originally provided for in 
such grant.

                 [TITLE II--OTHER FINANCIAL ASSISTANCE

              [public works and development facility loans

  [Sec. 201. (a) Upon the application of any State, or 
political subdivision thereof, Indian tribe, or private or 
public nonprofit organization or association representing any 
redevelopment area or part thereof, the Secretary is authorized 
to purchase evidence of indebtedness and to make loans to 
assist in financing the purchase or development of land and 
improvements for public works, public service, or development 
facility usage, including public works, public service, or 
development facility usage, to be provided by agencies of the 
Federal Government pursuant to legislation requiring that non-
Federal entities bear some part of the cost thereof, and the 
acquisition, construction, rehabilitation, alteration, 
expansion, or improvement of such facilities, including related 
machinery and equipment, within a redevelopment area, if he 
finds that--
          [(1) the project for which financial assistance 
        sought will directly or indirectly--
                  [(A) tend to improve the opportunities, in 
                the area where such project is or will be 
                located, for the successful establishment or 
                expansion of industrial or commercial plants or 
                facilities,
                  [(B) otherwise assist in the creation of 
                additional long-term employment opportunities 
                for such area, or
                  [(C) primarily benefit the long-term 
                unemployed and members of low-income families 
                or otherwise substantially further the 
                objectives of the Economic Opportunity Act of 
                1964;
          [(2) the funds requested for such project are not 
        otherwise available from private lenders or from other 
        Federal agencies on terms which in the opinion of the 
        Secretary will permit the accomplishment of the 
        project;
          [(3) the amount of the loan plus the amount of other 
        available funds for such project are adequate to insure 
        the completion thereof;
          [(4) there is a reasonable expectation of repayment; 
        and
          [(5) such area has an approved overall economic 
        development program as provided in section 202(b)(10) 
        and the project for which financial assistance is 
        sought is consistent with such program.
  [(b) Subject to section 710(5), no loan, including renewals 
or extensions thereof, shall be made under this section for a 
period exceeding forty years, and no evidence of indebtedness 
maturing more than forty years from the date of purchase shall 
be purchased under this section. Such loans shall bear interest 
at a rate not less than a rate determined by the Secretary of 
the Treasury taking into consideration the current average 
market yield on outstanding marketable obligations of the 
United States with remaining periods to maturity comparable to 
the average maturities of such loans, adjusted to the nearest 
one-eight of 1 per centum, less not exceed one-half of 1 per 
centum per annum.
  [(c) There are hereby authorized to be appropriated such sums 
as may be necessary to carry out the provisions of this section 
and section 202, except that annual appropriations for the 
purposes of purchasing evidence of indebtedness, paying 
interest supplement to or on behalf of private entities making 
and participating in loans, and guaranteeing loans, shall not 
exceed $170,000,000 for the fiscal year ending June 30, 1966, 
and for each fiscal year thereafter through the fiscal year 
ending June 30, 1973, and shall not exceed $55,000,000 for the 
fiscal year ending June 30, 1974, and shall not exceed 
$75,000,000 for the fiscal years ending June 30, 1975, and June 
30, 1976, and shalll not exceed $18,750,000 for the period 
beginning July 1, 1976, and ending September 30, 1976, and 
shall not exceed $200,000,000 per fiscal year for the fiscal 
years ending September 30, 1977, September 30, 1978, September 
30, 1979, September 30, 1980, and September 30, 1981, and not 
to exceed $46,500,000 for the fiscal year ending September 30, 
1982.
  [(e) The Secretary shall prescribe regulations which will 
assure that appropriate local governmental authorities have 
been given a reasonable opportunity to review and comment upon 
proposed projects under this section.

                         [loans and guarantees

  [Sec. 202. (a)(1) The Secretary is authorized to aid in 
financing, within a redevelopment area, the purchase or 
development of land and facilities (including machinery and 
equipment) for industrial or commercial usage, including the 
construction of new buildings, the rehabilitation of abandoned 
or unoccupied buildings, and the alteration, conversion, or 
enlargement of existing buildings by (A) purchasing evidences 
of indebtedness, (B) making loans (which for purposes of this 
section shall include participation in loans), (C) guaranteeing 
loans made to private borrowers by private lending 
institutions, for any of the purposes referred to in this 
paragraph upon application of such institution and upon such 
terms and conditions as the Secretary may prescribe, except 
that no such guarantee shall at any time exceed 90 per centum 
of the amount of the outstanding unpaid balance of such loan.
  [(2) In addition to any other financial assistance under this 
title, the Secretary is authorized, in the case of any loan 
guarantee under authority of paragraph (1) of this section, to 
pay to or on behalf of the private borrower an amount 
sufficient to reduce up to 4 percentage points the interest 
paid by such borrower on such guaranteed loans. No payment 
under this paragraph shall result in the interest rate being 
paid by a borrower on such a guaranteed loan being less than 
the rate of interest for such a loan if it were made under 
section 201 of this Act. Payment made to or on behalf of such 
borrower shall be made no less often than annually.
  [(3) The Secretary is authorized to aid in financing any 
industrial or commercial activity within a redevelopment area 
by (A) making working capital loans, (B) guaranteeing working 
capital loans made to private borrowers by private lending 
institutions upon application of such institution and upon such 
terms and conditions as the Secretary may prescribe, except 
that no such guarantee shall at any time exceed 90 per centum 
of the amount of the outstanding unpaid balance of such loan, 
(C) guaranteeing rental payment of leases for buildings and 
equipment, except that no such guarantee shall exceed 90 per 
centum of the remaining rental payments required by the lease, 
(D) paying those debts with respect to which a lien against 
property has been legally obtained (including the refinancing 
of any such debt) in any case where the Secretary determines 
that it is essential to do so in order to save employment in a 
designated area, to avoid a significant rise in unemployment, 
or to create new or increased employment.
  [(b) Financial assistance under this section shall be on such 
terms and conditions as the Secretary determines, subject, 
however, to the following restrictions and limitations:
          [(1) Such financial assistance shall not be extended 
        to assist establishments relocating from one area to 
        another or to assist subcontractors whose purpose is to 
        divest, or whose economic success is dependent upon 
        divesting, other contractors or subcontractors of 
        contracts theretofore customarily performed by them: 
        Provided, however, That such limitations shall not be 
        construed to prohibit assistance for the expansion of 
        an existing business entity through the establishment 
        of a new branch, affiliate, or subsidiary of such 
        entity if the Secretary finds that the establishment of 
        such branch, affiliate, or subsidiary will not result 
        in increase in unemployment of the area of original 
        location or in any other area where such entity 
        conducts business operations, unless the Secretary has 
        reason to believe that such branch, affiliate, or 
        subsidiary is being established with the intention of 
        closing down the operations of the existing business 
        entity in the area of its original location or in any 
        other area where it conducts such operations.
          [(2) Such assistance shall be extended only to 
        applicants, both private and public (including Indian 
        tribes), which have been approved for such assistance 
        by an agency or instrumentality of the State or 
        political subdivision thereof in which the project to 
        be financed is located, and which agency or 
        instrumentality is directly concerned with problems of 
        economic development in such State or subdivision.
          [(3) The project for which financial assistance is 
        sought must be reasonably calculated to provide more 
        than a temporary alleviation of unemployment or 
        underemployment within the redevelopment area wherein 
        it is or will be located.
          [(4) No loan or guarantee shall be extended hereunder 
        unless the financial assistance applied for is not 
        otherwise available from private lenders or from other 
        Federal agencies on terms which in the opinion of the 
        Secretary will permit the accomplishment of the 
        project.
          [(5) The Secretary shall not make any loan without a 
        participation unless he determines that the loan cannot 
        be made on a participation basis.
          [(6) No evidence of indebtedness shall be purchased 
        and no loans shall be made or guaranteed unless it is 
        determined that there is reasonable assurance of 
        repayment.
          [(7) Subject to section 701(5) of this Act, no loan 
        or guarantee, including renewals or extension thereof, 
        may be made hereunder for a period exceeding twenty-
        five years and no evidences of indebtedness maturing 
        more than twenty-five years from date of purchase may 
        be purchased hereinder: Provided, That the foregoing 
        restrictions on maturities shall not apply to 
        securities or obligations received by the Secretary as 
        a claimant in bankruptcy or equitable reorganization or 
        as a creditor in other proceedings attendant upon 
        insolvency of the obligor.
          [(8) Loans made and evidences if indebtedness 
        purchased under this section shall bear interest at a 
        rate not less than a rate determined by the Secretary 
        of the Treasury taking into consideration the current 
        average market yield on outstanding marketable 
        obligations of the United States with remaining periods 
        to maturity comparable to the average maturities of 
        such loans, adjusted to the nearest one-eighth of 1 per 
        centum, plus additional charge, if any, toward covering 
        other costs of the program as the Secretary may 
        determine to be consistent with its purpose.
          [(9) Loan assistance (other than for a working 
        capital loan) shall not exceed 65 per centum of the 
        aggregate cost to the applicant (excluding all other 
        Federal aid in connection with the undertaking) of 
        acquiring or developing land and facilities (including 
        machinery and equipment), and of constructing, 
        altering, converting, rehabilitating, or enlarging the 
        building or buildings of the particular project, and 
        shall, among others, be on the condition that--
                  [(A) other funds are available in an amount 
                which which together with the assistance 
                provided hereunder, shall be sufficient to pay 
                such aggregate cost;
                  [(B) not less than 15 per centum of such 
                aggregate cost be supplied as equity capital or 
                as a loan repayable in no shorter period of 
                time and at no faster an amortization rate than 
                the Federal financial assistance extended under 
                this section is being repaid, and if such a 
                loan is secured, its security shall be 
                subordinate and inferior to the lien or liens 
                securing such Federal financial assistance: 
                Provided, however, That, except in projects 
                involving financial participation by Indian 
                tribes, not less than 5 per centum of such 
                aggregate cost shall be supplied by the State 
                or any agency, instrumentality, or political 
                subdivision thereof, or by a community or area 
                organization which is nongovernmental in 
                character, unless the Secretary shall determine 
                in accordance with the objective standards 
                promulgated by regulation that all or part of 
                such funds are not reasonably available to the 
                project because of the economic distress of the 
                area or for other good cause, in which case he 
                may waive the requirement of this provision to 
                the extent of such unavailability, and allow 
                the funds required by this subsection to be 
                supplied by the applicant or by such other non-
                Federal source as may reasonably be available 
                to the project;
          [(C) to the extent the Secretary finds such action 
        necessary to encourage financial participation in a 
        particular project by other lenders and investors, and 
        except as otherwise provided in subparagraph (B), any 
        Federal financial assistance extended under this 
        section may be repayable only after other loans made in 
        connection with such project have been repaid in full, 
        and the security, if any, for such Federal financial 
        assistance may be subordinate and inferior to the lien 
        or liens securing other loans made in connection with 
        the same project.
  [(10) No such assistance shall be extended unless there shall 
be submitted to and approval of the Secretary an overall 
program for the economic development of the area and a finding 
by the State, or any agency, instrumentality, or local 
political subdivision thereof, that the project for which 
financial assistance is sought is consistent with such program: 
Provided, That nothing in this Act shall authorize financial 
assistance for any project prohibited by laws of the State or 
local political subdivision in which the project would be 
located, nor prevent the Secretary from requiring such periodic 
revisions of previously approved overall economic development 
programs as he may deem appropriate.

                      [economic development funds

  [Sec. 203. Funds obtained by the Secretary under section 201; 
loan funds obtained under section 403, and collections and 
repayments received under this Act, shall be deposited in an 
economic development revolving fund (hereunder referred to as 
the ``fund''), which is hereby established in the Treasury of 
the United States, and which shall be available to the 
Secretary for the purpose of extending financial assistance 
under sections 201, 202, and 403, and for the payment of all 
obligations and expenditures arising in connection therewith. 
There shall also be credited to the fund such funds as have 
been paid into the area development fund or may be received 
from obligations outstanding under the Area Redevelopment Act. 
The fund shall pay into miscellaneous receipts of the Treasury, 
following the close of each fiscal year, interest on the amount 
of loans outstanding under this Act computed in such manner and 
at such rate as may be determined by the Secretary of the 
Treasury taking into consideration the current average market 
yield on outstanding marketable obligations of the United 
States with remaining periods to maturity comparable to the 
average maturities of such loans, adjusted to the nearest one-
eighth of 1 per centum, during the month of September preceding 
the fiscal year in which the loans were made.

                    [redevelopment area loan program

  [Sec. 204. (a) If a redevelopment area prepares a plan for 
the redevelopment of the area or a part thereof and submits 
such plan to the Secretary for his approval and the Secretary 
approves such plan, the Secretary is authorized to make an 
interest free loan to such area for the purpose of carrying out 
such plan. Such plan may include industrial land assembly, land 
banking, acquisition of surplus government property, 
acquisition of industrial sites including acquisition of 
abandoned properties with redevelopment potential, real estate 
development including redevelopment and rehabilitation of 
historical buildings for industrial and commerical use, 
rehabilitation and renovation of usable empty factory buildings 
for industrial and commerical use, and other investments which 
will accelerate recycling of land and facilities for job 
creating economic activity. Any such interest free loan shall 
be made on condition first, that the area will use such 
interest free loan to makes loans to carry out such plan and 
second, the repayment of any loan made by the area from such 
interest free loan shall be placed by such area in a revolving 
fund available solely for the making of other loans by the 
area, upon approval by the Secretary, for the economic 
redevelopment of the area. Any such interest free loan shall be 
repaid to the United States by a redevelopment area whenever 
such area has its designation as a redevelopment area 
terminated or modified under section 402 of this Act. This 
section shall not apply to any redevelopment area whose 
designation as a redevelopment area would be terminated or 
modified under section 402 of this Act except for the 
provisions of section 2 of the Act entitled ``An Act to amend 
the Public Works and Economic Development Act of 1965 to extend 
the authorizations for title I through IV through fiscal year 
1971'', approved July 6, 1970 (P.L. 91-304).
  [(b)(1) Each eligible recipient which receives assistance 
under this section shall annually during the period such 
assistance continues make a full and complete report to the 
Secretary, in such manner as the Secretary shall prescribe, and 
such report shall contain an evaluation of the effectiveness of 
the economic assistance provided under this section in meeting 
the need it was designed to alleviate and the purposes of this 
section.
  [(2) The Secretary shall include in the annual report 
pursuant to section 707 of this Act a consolidated report with 
his recommendations, if any, on the assistance authorized under 
this section, in a form which he deems appropriate.
  [(c) There is authorized to be appropriated to carry out this 
section not to exceed $125,000,000 per fiscal year for the 
fiscal years ending September 30, 1977, and September 30, 1979, 
September 30, 1980, and September 30, 1981.

      [TITLE III--TECHNICAL ASSISTANCE, RESEARCH, AND INFORMATION

  [Sec. 301. (a) In carrying out his duties under this Act the 
Secretary is authorized to provide technical assistance which 
would be useful in alleviating or preventing conditions of 
excessive unemployment or underemployment first, to areas which 
he has designated as redevelopment areas under this Act, and 
second, to other areas which he finds have substantial need for 
such assistance. Such assistance shall include project planning 
and feasibility studies, management and operational assistance, 
and studies evaluating the needs of, and development 
potentialities for, economic growth of such areas. Such 
assistance may be provided by the Secretary through members of 
his staff, through the payment of funds authorized for this 
section to other departments or agencies of the Federal 
Government, through the employment of private individuals, 
partnerships, firms, corporations, or suitable institutions, 
under contracts entered into for such purposes, or through 
grants-in-aid to appropriate public or private nonprofit State, 
area, district, or local organizations. The Secretary, in his 
discretion, may require the repayment of assistance provided 
under this subsection and prescribe the terms and conditions of 
such repayment.
  [(b) The Secretary is authorized to make grants to defray not 
to exceed 75 per centum of the administrative expenses of 
organizations which he determines to be qualified to receive 
grants-in-aid under subsection (a) hereof, except that in the 
case of a grant under this subsection to an Indian tribe the 
Secretary is authorized to defray up to 100 per centum of such 
expenses. In determining the amount of the non-Federal share of 
such costs or expenses, the Secretary shall give due 
consideration to all contributions both in cash and in kind, 
fairly evaluated, including but not limited to space, 
equipment, and services. Where practicable grants-in-aid 
authorized under this subsection shall be used in conjunction 
with other available planning grants, such as urban planning 
grants, authorized under the Housing Act of 1954, as amended, 
and highway planning and research grants authorized under the 
Federal-aid Highway Act of 1962, to assure adequate and 
effective planning and economical use of funds.
  [(c) To assist in the long-range accomplishment of the 
purposes of this Act, the Secretary, in cooperation with other 
agencies having similar functions, shall establish and conduct 
a continuing program of study, training, and research to (A) 
assist in determining the causes of unemployment, 
underemployment, underdevelopment, and chronic depression in 
the various areas and regions of the Nation, (B) assist in the 
formulation and implementation of national, State, and local 
programs which will raise income levels and otherwise produce 
solutions to the problems resulting from these conditions, and 
(C) assist in providing the personnel needs to conduct such 
programs. The program of study, training, and research may be 
conducted by the Secretary through members of his staff, 
through payment of funds authorized for this section to other 
departments or agencies of the Federal Government, or through 
the employment of private individuals, partnerships, firms, 
corporations, or suitable institutions, under contracts entered 
into for such purposes, or through grants to such individuals, 
organizations, or institutions, or through conferences, and 
similar meetings organized for such purposes. The Secretary 
shall make available to interested individuals and 
organizations the results of such research. The Secretary shall 
include in his annual report under section 707 a detailed 
statement concerning the study and research conducted under 
this section together with his findings resulting therefrom and 
his recommendations for legislative and other action.
  [(d) The Secretary shall aid redevelopment areas and other 
areas by furnishing to interested individuals, communities, 
industries, and enterprises within such areas any assistance, 
technical information, market research, or other forms of 
assistance, information, or advice which would be useful in 
alleviating or preventing conditions of excessive unemployment 
or underemployment within such areas. The Secretary may furnish 
the procurement divisions of the various departments, agencies, 
and other instrumentalities of the Federal Government with a 
list containing the names and addresses of business firms which 
are located in redevelopment areas and which are desirous of 
obtaining Government contracts for the furnishing of supplies 
or services, and designating the supplies and services such 
firms are engaged in providing.
  [(e) The Secretary shall establish an independent study board 
consisting of governmental and on governmental experts to 
investigate the effects of Government procurement, scientific, 
technical, and other related policies, upon regional economic 
development. Any Federal officer or employee may, with the 
consent of the head of the department or agency in which he is 
employed, serve as a member of such board, but shall receive no 
additional compensation for such service. Other members of such 
board may be compensated in accordance with the provisions of 
section 701(10). The board shall report its findings, together 
with recommendations for the better coordination of such 
policies, to the Secretary, who shall transmit the report to 
the Congress not later than two years after the enactment of 
this Act.
  [(f) The Secretary is authorized to make grants, enter into 
contracts or otherwise provide funds for any demonstration 
project within a redevelopment area or areas which he 
determines is designed to foster regional productivity and 
growth, prevent out migration, and otherwise carry out the 
purposes of this Act.
  [Sec. 302. (a) The Secretary is authorized, upon application 
of any State, or city, or other political subdivision of a 
State, or sub-State planning and development organization 
(including a redevelopment area or an economic development 
district), to make direct grants to such State, city, or other 
political subdivision, or organization to pay up to 80 per 
centum of the cost for economic development planning. The 
planning for cities, other political subdivisions, and sub-
State planning and development organizations (including 
redevelopment areas and economic development districts) 
assisted under this section shall include systematic efforts to 
reduce unemployment and increase incomes. Such planning shall 
be a continuous process involving public officials and private 
citizens in analyzing local economics, defining development 
goals, determining project opportunities, and formulating and 
implementing a development program. Any overall State economic 
development plan prepared with assistance under this section 
shall be prepared cooperatively by the State, its political 
subdivisions, and the economic development districts located in 
whole or in part within such State. Upon completion of any such 
plan, the State shall certify to the Secretary first, that in 
the preparation of such State plan, the local and economic 
development district plans were considered and, to the fullest 
extent possible, such State plan is consistent with such local 
and economic development district plans, and second, that such 
State plan is consistent, with such local and economic 
development district plans, or, if such State plan is not 
consistent with such local and economic development district 
plans, all of the inconsistencies of the State plan with the 
local and economic development district plans, and the 
justification for each of these inconsistencies. Any overall 
State economic development planning shall be a part of a 
comprehensive planning process that shall consider the 
provision of public works to stimulate and channel development, 
economic opportunities and choices for individuals; to support 
sound land use, to enhance and protect the environment 
including the conservation and preservation of open spaces and 
environmental quality, to provide public services, and to 
balance physical and human resources through the management and 
control of physical development. The assistance available under 
this section may be provided in addition to assistance 
available under section 301(b) of this Act but shall not 
supplant such assistance and shall be available to develop an 
annual inventory of specific recommendations for assistance 
under section 304 of this Act. Each State receiving assistance 
under this subsection shall submit to the Secretary an annual 
report on the planning process assisted under this subsection.
  [(b) In addition, the Secretary is authorized to assist 
economic development districts in--
          [(1) providing technical assistance (other than by 
        grant) to local governments within the district; and
          [(2) carrying out any review procedure required 
        pursuant to title IV of the Intergovernmental 
        Cooperation Act of 1968, if such district has been 
        designated as the agency to conduct such review.
  [(c) The planning assistance authorized under this title 
shall be used in accordance with the review procedure required 
pursuant to title IV of the Intergovernmental Cooperation Act 
of 1968 and shall be used in conjunction with any other 
available Federal planning assistance to assure adequate and 
effective planning and economical use of funds.
  [Sec. 303. (a) There is hereby authorized to be appropriated 
$25,000,000 annually for the purposes of Sections 301 and 302 
of this Act, for the fiscal year ending June 30, 1966, and for 
each fiscal year thereafter through the fiscal year ending June 
30, 1969, $50,000,000 per fiscal year for the fiscal years 
ending June 30, 1970, June 30, 1971, June 30, 1972, and June 
30, 1973, and $35,000,000 for the fiscal year ending June 30, 
1974 and $75,000,000 per fiscal year for the fiscal years 
ending June 30, 1975, and June 30, 1976, $18,750,000 for the 
period beginning July 1, 1976, and ending September 30, 1976, 
and $75,000,000 per fiscal year for the fiscal years ending 
September 30, 1977, September 30, 1978, September 30, 1979, 
September 30, 1980, and September 30, 1981, and not to exceed 
$35,500,000 for the fiscal year ending September 30, 1982.
  [(b) Not to exceed $15,000,000 in each of the fiscal years 
ending June 30, 1975, and June 30, 1976. September 30, 1977, 
September 30, 1978, September 30, 1979, September 30, 1980, 
September 30, 1981, and September 30, 1982, of the sums 
authorized to be appropriated under subsection (a) of this 
section, shall be available to make grants to States.

                     [supplemental and basic grants

  [Sec. 304. (a) There are hereby authorized to be appropriated 
$35,000,000 for the fiscal year ending June 30, 1975, and 
$75,000,000 for the fiscal year ending June 30, 1976, 
$18,750,000 for the period beginning July 1, 1976, and ending 
September 30, 1976, and $75,000,000 per fiscal year for the 
fiscal year ending September 30, 1977, September 30, 1978, 
September 30, 1979, September 30, 1980, and September 30, 1981, 
for apportionment by the Secretary among the States for the 
purpose of supplementing or making grants and loans authorized 
under titles I, II, III (other than planning grants authorized 
under sections 301(b) and 302), IV, and IX of this Act. Such 
funds shall be apportioned among the States in the ratio which 
all grants made under title I of this Act since August 26, 
1965, in each State bear to the total of all such grants made 
in all the States since August 26, 1965.
  [(b) Funds apportioned to a State pursuant to subsection (a) 
shall be available for supplementing or making such grants or 
loans if the State makes a contribution of at least 25 per 
centum of the amount of such grant or loan in each case. Funds 
apportioned to a State under subsection (a) shall remain 
available to such State until obligated or expended by it.
  [(c) Funds apportioned to a State pursuant to this section 
may be used by the Governor in supplementing grants or loans 
with respect to any project or assistance authorized under 
title I, II, III (other than planning grants authorized under 
sections 301(b) and 302), IV, or IX of this Act, and approved 
by the Secretary after July 1, 1974. Such grants may be used to 
reduce or waive the non-Federal share otherwise required by 
this Act, subject to the requirements of subsection (b) of this 
section.
  [(d) In the case of any grant or loan for which all or any 
portion of the basic Federal contribution to the project under 
this Act is proposed to be made with funds available under this 
section, no such Federal contribution shall be made until the 
Secretary of Commerce certifies that such project meets all of 
the requirements of this Act and could be approved for Federal 
contributions under this Act if funds were available under this 
Act (other than section 509) for such project. Funds may be 
provided for projects in a State under this section only if the 
Secretary determines that the level of Federal and State 
financial assistance under this Act (other than section 509) 
and under Acts other than this Act, for the same type of 
projects in the State, will not be diminished in order to 
substitute funds authorized by this section.
  [(e) After June 30, 1975, funds apportioned to a State 
pursuant to this section shall be used by the Governor in a 
manner which is consistent with the State planning process 
assisted under section 302 of this Act, if such planning 
process has been established in such State.

                [TITLE IV--AREA AND DISTRICT ELIGIBILITY

                      [Part A--Redevelopment Areas

                           [area eligibility

  [Sec. 401. (a) The Secretary shall designate as 
``redevelopment areas''--
    [(1) those areas in which he determines, upon the basis of 
standards generally comparable with those set forth in 
paragraphs (A) and (B), that there has existed substantial and 
persistent unemployment for an extended period of time and 
those areas in whcih he determines there has been a substantial 
loss of population due to lack of employment opportunity. There 
shall be included among the areas so designated any area--
                  [(A) where the Secretary of Labor finds that 
                the current rate of unemployment, as determined 
                by appropriate annual statistics for the most 
                recent twelve consecutive months, is 6 per 
                centum or more and has averaged at least 6 per 
                centum for the qualifying time periods 
                specified in paragraph (B); and
                  [(B) where the Secretary of Labor finds that 
                the annual average rate of unemployment has 
                been at least--
                          [(i) 50 per centum above the national 
                        average for three of the preceding four 
                        calendar years, or
                          [(ii) 75 per centum above the 
                        national average for two of the 
                        preceding three calendar years, or
                          [(iii) 100 per centum above the 
                        national average for one of the 
                        preceding two calendar years.
        [The Secretary of Labor shall find the facts and 
        provide the data to be used by the Secretary in making 
        the determinations required by this subsection;
          [(2) those additional areas which have a median 
        family income not in excess of 50 per centum of the 
        national median, as determined by the most recent 
        available statistics for such areas;
          [(3) those additional Federal or State Indian 
        reservations or trust or restricted Indian-owned land 
        areas which the Secretary, after consultation with the 
        Secretary of the Interior or an appropriate State 
        agency, determines manifest the greatest degree of 
        economic distress on the basis of unemployment and 
        income statistics and other appropriate evidence of 
        economic underdevelopment; Provided, however, That 
        uninhabited Federal or State Indian reservations or 
        trust or restricted Indian-owned land areas may be 
        designated where such designation would permit 
        assistance to Indian tribes, with a direct beneficial 
        effect on the economic well-being of Indians;
          [(4) upon request of such areas, those additional 
        areas in which the Secretary detemines that the loss, 
        removal, curtailment, or closing of a major source of 
        employment has caused within three years prior to, or 
        threatens to cause within three years after, the date 
        of the request an unusual and abrupt rise in 
        unemployment of such magnitude that the unemployment 
        rate for the area at the time of the request exceeds 
        the national average, or can reasonably be expected to 
        exceed the national average, by 50 per centum or more 
        unless assistance is provided. Notwithstanding any 
        provision of subsection 401(b) to the contrary, an area 
        designated under the authority of this paragraph may be 
        given a reasonable time after designation in which to 
        submit the overall economic development program 
        required by subsection 202(b)(10) of this Act;
          [(5) notwithstanding any provision of this section to 
        the contrary, those additional areas which were 
        designated redevelopment areas under the Area 
        Redevelopment Act on or after March 1, 1965; Provided, 
        however, That the continued eligibility of such areas 
        after the first annual review of eligibility conducted 
        in accordance with section 402 of this Act shall be 
        dependent on their qualification for designation under 
        the standards of economic need set forth in subsections 
        (a)(1) through (a)(4) of this section;
          [(6) those communities or neighborhoods (defined 
        without regard to political or other subdivisions or 
        boundaries) which the Secretary determines have one of 
        the following conditions:
                  [(A) a large concentration of low-income 
                persons;
                  [(B) rural areas having substantial 
                outmigration;
                  [(C) substantial unemployment; or
                  [(D) an actual or threatened abrupt rise of 
                unemployment due to the closing or curtailment 
                of a major source of employment.
        No redevelopment area established under this paragraph 
        shall be subject to the requirements of subparagrphs 
        (A) and (C) of paragraph (1) of subsection (a) of 
        section 101 of this Act. No redevelopment area 
        established under this paragraph shall be eligible to 
        meet the requirements of section 403(a)(1)(B) of this 
        Act;
          [(7) those areas where per capita employment has 
        declined significantly during the next preceding ten-
        year period for which appropriate statistics are 
        available;
          [(8) those areas which the Secretary of Labor 
        determines, on the basis of average annual available 
        unemployment statistics, to have experienced 
        unemployment which is both substantial and above the 
        national average for the preceding twenty-four months;
          [(9) those areas which the Secretary determines have 
        demonstrated long-term economic deterioration.
        [(b) The size and boundaries of redevelopment areas 
        shall be as determined by the Secretary: Provided, 
        however, That--
          [(1) no area shall be designated until it has an 
        approved overall economic development program in 
        accordance with subsection 202(b)(10) of this Act;
          [(2) any area which does not submit an acceptable 
        overall economic development program in accordance with 
        subsection 202(b)(10) of this Act within the reasonable 
        time after notification of eligibility for designation, 
        shall not thereafter be designated prior to the next 
        annual review of eligibility in accordance with section 
        402 of this Act;
          [(3) no area shall be designated which does not have 
        a population of at least one thousand five hundred 
        persons, except that this limitation shall not apply to 
        any area designated under section 401 (a)(3) or (a)(6); 
        and.
          [(4) except for areas designated under subsections 
        (a)(3), (a)(4) and (a)(6) hereof, no area shall be 
        designated which is smaller than a ``labor area'' (as 
        defined by the Secretary of Labor), a country, or 
        municipality with a population of over twenty-five 
        thousand, whichever in the opinion of the Secretary is 
        appropriate. Nothing in this subsection shall prevent 
        any municipality, designated as a redevelopment area or 
        eligible to be designated as a redevelopment area, from 
        combining with any other community having mutual 
        economic interests and transportation and marketing 
        patterns for the purposes of such designation.
  [(c) Upon the request of the Secretary, the Secretary of 
Labor, the Secretary of Agriculture, the Secretary of the 
Interior, and such other heads of agencies as may be 
appropriate are authorized to conduct such special studies, 
obtain such information, and compile and furnish to the 
Secretary such data as the Secretary may deem necessary or 
proper to enable him to make the determinations provided for in 
this section. The Secretary shall reimburse when appropriate, 
out of any funds appropriated to carry out the purposes of this 
Act, the foregoing officers for any expenditures incurred by 
them under this section.
  [(d) If a State has no area designated under the preceding 
subsections of this section as a redevelopment area, the 
Secretary shall designate as a redevelopment area that area in 
such State which in his opinion most nearly qualifies under 
such preceding subsections. An area so designated shall have 
its eligibility terminated in accordance with the provisions of 
section 402 if any other area within the same State 
subsequently has become qualified or been designated under any 
other subsection of this section other than subsection (a)(6) 
as of the time of the annual review prescribed by section 402: 
Provided, That the Secretary shall not terminate any 
designation of an area in a State as a redevelopment area if to 
do so would result in such State having no redevelopment area.
  [(e) As used in this Act, the term ``redevelopment area'' 
refers to any area within the United States which has been 
designated by the Secretary as a redevelopment area.

                   [annual review of area eligibility

  [Sec. 402. The Secretary shall conduct an annual review of 
all areas designated in accordance with section 401 of this 
Act, and on the basis of such reviews shall terminate or modify 
such designation whenever such an area no longer satisfies the 
designation requirements of section 401, but in no event shall 
such designation of an area be terminated prior to the 
expiration of the third year after the date such area was so 
designated. No area previously designated shall retain its 
designated status unless it maintains a currently approved 
overall economic development program in accordance with 
subsection 202(b)(10). No termination of eligibility shall 
first, be made without thirty days' prior notification to the 
area concerned, second, affect the validity of any application 
filed, or contract or undertaking entered into, with respect to 
such area pursuant to this Act prior to such termination, 
third, prevent any such area from again being designated a 
redevelopment area under section 401 of this Act if the 
Secretary determines it to be eligible under such section, or 
fourth, be made in the case of any designated area where the 
Secretary determines that an improvement in the unemployment 
rate of a designated area is primarily the result of increased 
employment in occupations not likely to be permanent. The 
Secretary shall keep the departments and agencies of the 
Federal Government, and interested State or local agencies, 
advised at all times of any changes made hereunder with respect 
to the classification of any area.

                [Part B--Economic Development Districts

  [Sec. 403. (a) In order that economic development projects of 
broader geographic significance may be planned and carried out, 
the Secretary is authorized--
          [(1) to designate appropriate ``economic development 
        districts'' within the United States with the 
        concurrence of the States in which such districts will 
        be wholly or partially located, if--
                  [(A) the proposed district is of sufficient 
                size or population, and contains sufficient 
                resources, to foster economic development on a 
                scale involving more than a single 
                redevelopment area;
                  [(B) the proposed district contains at least 
                one redevelopment area;
                  [(C) the proposed district contains one or 
                more redevelopment areas or economic 
                development centers identified in an approved 
                district overall economic development program 
                as having sufficient size and potential to 
                foster the economic growth activities necessary 
                to alleviate the distress of the redevelopment 
                areas within the district; and
                  [(D) the proposed district has a district 
                overall economic development program which 
                includes adequate land use and transportation 
                planning and contains a specific program for 
                district cooperation, self-help, and public 
                investment and is approved by the State or 
                States affected and by the Secretary;
          [(2) to designate as ``economic development 
        centers,'' in accordance with such regulations as he 
        shall prescribe, such areas as he may deem appropriate, 
        if--
                  [(A) the proposed center has been identified 
                and included in an approved district overall 
                economic development program and recommended by 
                the State or States affected for such special 
                designation:
                  [(B) the proposed center is geographically 
                and economically so related to the district 
                that its economic growth may reasonably be 
                expected to contribute significantly to the 
                alleviation of distress in the redevelopment 
                areas of the district; and
                  [(C) the proposed center does not have a 
                population in excess of two hundred and fifty 
                thousand according to the last preceding 
                Federal census.
          [(3) to provide financial assistance in accordance 
        with the criteria of sections 101, 201, and 202 of this 
        Act, except as may be herein otherwise provided, for 
        projects in economic development centers designed under 
        subsection (a)(2) above, if--
                  [(A) the project will further the objectives 
                of the overall economic development program of 
                the district in which it is to be located:
                  [(B) the project will enhance the economic 
                growth potential of the district or result in 
                additional long-term employment opportunities 
                commensurate with the amount of Federal 
                financial assistance requested; and
                  [(C) the amount of Federal financial 
                assistance requested is reasonably related to 
                the size, population, and economic needs of the 
                district;
          [(4) subject to the 20 per centum non-Federal share 
        required for any project by subsection 101(c) of this 
        Act, to increase the amount of grant assistance 
        authorized by section 101 for projects within 
        redevelopment areas (designated under section 401), by 
        an amount not to exceed 10 per centum of the aggregate 
        cost of any such project, in accordance with such 
        regulations as he shall prescribe if--
                  [(A) the redevelopment area is situated 
                within a designated economic development 
                district and is actively participating in the 
                economic development activities of the 
                district; and
                  [(B) the project is consistent with an 
                approved district overall economic development 
                program.
  [(b) In designating economic development districts and 
approving district overall economic development programs under 
subsection (a) of this section, the Secretary is authorized, 
under regulations prescribed by him--
          [(1) to invite the several States to draw up proposed 
        district boundaries and to identify potential economic 
        development centers;
          [(2) to cooperate with the several States--
                  [(A) in sponsoring and assisting district 
                economic planning and development groups, and
                  [(B) in assisting such district groups to 
                formulate district overall economic development 
                programs;
          [(3) to encourage participation by appropriate local 
        governmental authorities in such economic development 
        districts.
  [(c) The Secretary shall by regulation prescribe standards 
for the termination or modification of economic development 
districts and economic development centers designated under the 
authority of this section.
  [(d) As used in this Act, the term ``economic development 
district'' refers to any area within the United States composed 
of cooperating redevelopment areas and, where appropriate, 
designated economic development centers and neighboring 
counties or communities, which has been designated by the 
Secretary as an economic development district.
  [(e) As used in this Act, the term ``economic development 
center'' refers to any area within the United States which has 
been identified as an economic development center in an 
approved district overall economic development program and 
which has been designated by the Secretary as eligible for 
financial assistance under sections 101, 201, and 202 of this 
Act in accordance with the provisions of this section.
  [(f) For the purpose of this Act the term ``local 
government'' means any city, county, town, parish, village, or 
other general-purpose political subdivision of a State.
  [(g) There is hereby authorized to be appropriated not to 
exceed $50,000,000 for the fiscal year ending June 30, 1967, 
and for each fiscal year thereafter through the fiscal year 
ending June 30, 1973, and not to exceed $45,000,000 per fiscal 
year for the fiscal years ending June 30, 1974, June 30, 1975, 
and June 30, 1976, not to exceed $11,250,000 for the period 
beginning July 1, 1976, and ending September 30, 1976, and not 
to exceed $45,000,000 per fiscal year for the fiscal years 
ending September 30, 1977, September 30, 1978, September 30, 
1979, September 30, 1980, September 30, 1981, for financial 
assistance extended under the provisions of subsection (a)(3) 
and (a)(4) hereof.
  [(h) In order to allow time for adequate and careful district 
planning, subsection (g) of this section shall not be effective 
until one year from the date of enactment.
  [(i) Each economic development district designated by the 
Secretary under this section shall as soon as practicable after 
the date of enactment of this section or after its designation 
provide that a copy of the district overall economic 
development program be furnished to the appropriate regional 
commission established under title V of this Act, if any part 
of such proposed district is within such a region or to the 
Appalachian Regional Commission established under the 
Appalachian Regional Development Act of 1965, if any part of 
such proposed district is within the Appalachian region.
  [(j) The Secretary is authorized to provide the financial 
assistance which is available to a redevelopment area under 
this Act to those parts of an economic development district 
which are not within a redevelopment area, when such assistance 
will be of a substantial direct benefit to a redevelopment area 
within such district. Such financial assistance shall be 
provided in the same manner and to the same extent as is 
provided in this Act for a redevelopment area, except that 
nothing in this subsection shall be construed to permit such 
parts to receive the increase in the amount of grant assistance 
authorized in paragraph (4) of subsection (a) of this section.

                  [Part C--Indian Economic Development

  [Sec. 404. In order to assure a minimum Federal commitment to 
alleviate economic distress of Indians, in addition to their 
eligibility for assistance with funds authorized under other 
parts of this Act, there are authorized to be appropriated not 
to exceed $25,000,000 per fiscal year for the fiscal years 
ending June 30, 1975, and June 30, 1976, not to exceed 
$6,250,000 for the period beginning July 1, 1976, and ending 
September 30, 1976, and not to exceed $25,000,000 per fiscal 
year for the fiscal years ending September 30, 1977, September 
30, 1978, September 30, 1979, September 30, 1980, September 30, 
1981, for the purpose of providing assistance under this Act to 
Indian tribes. Such sums shall be in addition to all other 
funds made available to Indian tribes under this Act.

               [Part D--Unemployment Rate Determinations

  [Sec. 405. Whenever any provision of this Act requires the 
Secretary of Labor, or the Secetary, to make any determination 
or other finding relating to the unemployment rate of any area, 
information regarding such unemployment rate may be furnished 
either by the Federal Government or by a State. Unemployment 
rates furnished by a State shall be accepted by the Secretary 
unless he determines that such rates are inaccurate. The 
Secretary shall provide technical assistance to State and local 
governments in the calculation of unemployment rates to insure 
their validity and standardization.

                       [TITLE VI--ADMINISTRATION

  [Sec. 601. (a) The Secretary shall administer this Act and, 
with the assistance of an Assistant Secretary of Commerce, in 
addition to those already provided for, shall supervise and 
direct the Administrator created herein, and coordinate the 
Federal cochairmen appointed heretofore or subsequent to this 
Act. The Assistant Secretary created by this section shall be 
appointed by the President by and with the advice and consent 
of the Senate. Such Assistant Secretary shall perform such 
functions as the Secretary may prescribe. There shall be 
appointed by the President, by and with the advice and consent 
of the Senate, an Administrator for Economic Development who 
shall be compensated at the rate provided for level V of the 
Federal Executive Salary Schedule who shall perform such duties 
as are assigned by the Secretary.
  [(b) Paragraph (12) of subsection (d) of section 303 of the 
Federal Executive Salary Act of 1964 is amended by striking out 
``(4)'' and inserting in lieu thereof ``(5)''.
  [(c) Subsection (e) of section 303 of the Federal Executive 
Salary Act of 1964 is amended by adding at the end thereof the 
following new paragraph:
  [``(100) Administrator for Economic Development.''

          [advisory committee on regional economic development

  [Sec. 602. The Secretary shall appoint a National Public 
Advisory Committee on Regional Economic Development which shall 
consist of twenty-five members and shall be composed of 
representatives of labor, management, agriculture, State and 
local governments, and the public in general. From the members 
appointed to such Committee the Secretary shall designate a 
Chairman. Such Committee, or any duly established subcommittee 
thereof, shall from time to time make recommendations to the 
Secretary relative to the carrying out of his duties under this 
Act. Such Committee shall hold not less than two meetings 
during each calendar year.

             [consultation with other persons and agencies

  [Sec. 603. (a) The Secretary is authorized from time to time 
to call together and confer with any persons, including 
representatives of labor, management, agriculture, and 
government, who can assist in meeting the problems of area and 
regional unemployment or underemployment.
  [(b) The Secretary may make provisions for such consultation 
with interested departments and agencies as he may deem 
appropriate in the performance of the functions vested in him 
by this Act.

               administration, operation, and maintenance

  [Sec. 604. No Federal assistance shall be approved under this 
Act unless the Secretary is satisifed that the project for 
which Federal assistance is granted will be properly and 
efficiently administered, operated, and maintained.

                       [TITLE VII--MISCELLANEOUS

                          [powers of secretary

  [Sec. 701. In performing his duties under this Act, the 
Secretary is authorized to--
          [(1) adopt, alter, and use a seal, which shall be 
        judicially noticed;
          [(2) hold such hearings, sit and act at such times 
        and places, and take such testimony, as he may deem 
        advisable.
          [(3) request directly from any executive department, 
        bureau, agency, board, commission, office, independent 
        establishment, or instrumentality information, 
        suggestions, estimates, and statistics needed to carry 
        out the purposes of this Act; and each department, 
        bureau, agency, board, commission, office, 
        establishment or instrumentality is authorized to 
        furnish such information, suggestions, estimates, and 
        statistics directly to the Secretary;
          [(4) under regulations prescribed by him, assign or 
        sell at public or private sale, or otherwise dispose of 
        for cash or credit, in his discretion and upon such 
        terms and conditions and for such consideration as he 
        shall determine to be reasonable, any evidence of debt, 
        contract, claim, personal property, or security 
        assigned to or held by him in connection with loans 
        made or evidences of indebtedness purchased under this 
        Act, and collect or compromise all obligations assigned 
        to or held by him in connection with such loans or 
        evidences of indebtedness until such time as such 
        obligations may be referred to the Attorney General for 
        suit or collection;
          [(5) further extend the maturity of or renew any loan 
        made or evidence of indebtedness purchased under this 
        Act, beyond the periods stated in such loan or evidence 
        of indebtedness or in this Act, for additional periods 
        not to exceed ten years, if such extension or renewal 
        will aid in the orderly liquidation of such loan or 
        evidence of indebtedness;
          [(6) deal with, complete, renovate, improve, 
        modernize, insure, rent, or sell for cash or credit, 
        upon such terms and conditions and for such 
        consideration as he shall determine to be reasonable, 
        any real or personal property conveyed to, or otherwise 
        acquired by him in connection with loans made or 
        evidences of indebtedness purchased under this Act;
          [(7) pursue to final collection, by way of compromise 
        or other administrative action, prior to reference to 
        the Attorney General, all claims against third parties 
        assigned to him in connection with loans made or 
        evidences of indebtedness purchased under this Act. 
        This shall include authority to obtain deficiency 
        judgments or otherwise in the case of mortgages 
        assigned to the Secretary. Section 3709 of the Revised 
        Statutes, as amended (41 U.S.C. 5), shall not apply to 
        any contract of harzard insurance or to any purchase or 
        contract for services or supplies on account of 
        property obtained by the Secretary as a result of loans 
        made or evidences of indebtedness purchased under this 
        Act if the premium therefor or the amount thereof does 
        not exceed $1,000. The power to convey and to execute, 
        in the name of the Secretary, deeds of conveyance, 
        deeds of release, assignments and satisfactions of 
        mortgages, and any other written instrument relating to 
        real or personal property or any interest therein 
        acquired by the Secretary pursuant to the provisions of 
        this Act may be exercised by the Secretary or by any 
        officer or agent appointed by him for that purpose 
        without the execution of any express delegation of 
        power or power of attorney;
          [(8) acquire, in any lawful manner, any property 
        (real, personal, or mixed, tangible or intangible), 
        whenever deemed necessary or appropriate to the conduct 
        of the activities authorized in sections 201, 202, 301, 
        403, and 503 of this Act;
          [(9) in addition to any powers, functions, 
        privileges, and immunities otherwise vested in him, 
        take any and all actions, including the procurement of 
        the services of attorneys by contract, determined by 
        him to be necessary or desirable in making, purchasing, 
        servicing, compromising, modifying, liquidating, or 
        otherwise administratively dealing with or realizing on 
        loans made or evidences of indebtedness purchased under 
        this Act;
          [(10) employ experts and consultants or organizations 
        therefor as authorized by section 15 of the 
        Administrative Expenses Act of 1946 (5 U.S.C. 55a), 
        compensate individuals so employed at rates not in 
        excess of $100 per diem, including travel time, and 
        allow them, while away from their homes or regular 
        places of business, travel expenses (including per diem 
        in lieu of subsistence) as authorized by section 5 of 
        such Act (5 U.S.C. 73b-2) for persons in the Government 
        service employed intermittently, while so employed: 
        Provided, however, That contracts for such employment 
        may be renewed annually;
          [(11) sue and be sued in any court of record of a 
        State having general jurisdiction or in any United 
        States district court, and jurisdiction is conferred 
        upon such district court to determine such 
        controversies without regard to the amount in 
        controversy; but no attachment, injunction, 
        garnishment, or other similar process, mesne or final, 
        shall be issued against the Secretary or his property. 
        Nothing herein shall be construed to except the 
        activities under this Act from the application of 
        sections 507(b) and 2679 of title 28, United States 
        Code, and of section 367 of the Revised Statutes (5 
        U.S.C. 316); and
          [(12) establish such rules, regulations and 
        procedures as he may deem appropriate in carrying out 
        the provisions of this Act.

                   [prevention of unfair competition

  [Sec. 702. No financial assistance under this Act shall be 
extended to any project when the result would be to increase 
the production of goods, materials, or commodities, or the 
availability of services or facilities, when there is not 
sufficient demand for such goods, materials, commodities, 
services, or facilities, to employ the efficient capacity of 
existing competitive commercial or industrial enterprises.

                          [savings provisions

  [Sec. 703. (a) No suit, action, or other proceedings lawfully 
commenced by or against the Administrator or any other officer 
of the Area Redevelopment Administration in his official 
capacity or in relation to the discharge of his official duties 
under the Area Redevelopment Act, shall abate by reason of the 
taking effect of the provisions of this Act, but the court may, 
on motion or supplemental petition filed at any time within 
twelve months after such taking effect, showing a necessity for 
the survival of such suit, action, or other proceeding to 
obtain a settlement of the questions involved, allow the same 
to be maintained by or against the Secretary or the 
Administrator or such other officer of the Department of 
Commerce as may be appropriate.
  [(b) Except as may be otherwise expressly provided in this 
Act, all powers and authorities conferred by this Act shall be 
cumulative and additional to and not in derogation of any 
powers and authorities otherwise existing. All rules, 
regulations, orders, authorizations, delegations, or other 
actions duly issued, made, or taken by or pursuant to 
applicable law, prior to the effective date of this Act, by any 
agency, officer, or office pertaining to any functions, powers, 
and duties under the Area Redevelopment Act shall continue in 
full force and effect after the effective date of this Act 
until modified or rescinded by the Secretary or such other 
officer of the Department of Commerce as, in accordance with 
applicable law, may be appropriate.

 [transfer of functions, effective date, and limitations on assistance

  [Sec. 704. (a) The functions, powers, duties, and authorities 
and the assets, funds, contracts, loans, liabilities, 
commitments, authorizations, allocations, and records which are 
vested in or authorized to be transferred to the Secretary of 
the Treasury under section 29(b) of the Area Redevelopment Act, 
and all functions, powers, duties, and authorities under 
section 29(c) of the Area Redevelopment Act are hereby vested 
in the Secretary.
  [(b) The President may designate a person to act as 
Administrator under this Act until the office is filled as 
provided in this Act or until the expiration of the first 
period of sixty days following the effective date of this Act, 
which shall first occur. While so acting such person shall 
receive compensation at the rate provided by this Act for such 
office.
  [(c) The provisions of this Act shall take effect upon 
enactment unless herein explicity otherwise provided.
  [(d) Notwithstanding any requirements of this Act relating to 
the eligibility of areas, projects for which applications are 
pending before the Area Redevelopment Administration on the 
effective date of this Act shall for a period of one year 
thereafter be eligible for consideration by the Secretary for 
such assistance under the provisions of this Act as he may 
determine to be appropriate.
  [(e) No financial assistance authorized under this Act shall 
be used to finance the cost of facilities for the generation, 
transmission, or distribution of electrical energy, or to 
finance the cost of facilities for the production or 
transmission of gas (natural, manufactured, or mixed), except 
first, for projects specifically authorized by Congress, and 
second, for local projects for industrial parks and industrial 
or commercial areas in communities where the electrical energy 
or gas supply is, or is threatened to be interrupted or 
curtailed resulting in a loss of jobs, or where the purpose is 
to save jobs, or create new jobs, on condition that (A) the 
Secretary finds that project financing is not available from 
private lenders or other Federal agencies on terms which, in 
the opinion of the Secretary, will permit accomplishment of the 
project, and (B) the State or Federal regulatory body 
regulating such service determines that the facility to be 
financed will not compete with an existing public utility 
rendering such a service to the public at rates or charges 
subject to regulation by such State or Federal regulatory body, 
or if there is a determination of competition, the State or 
Federal regulatory body must make a determination that in the 
area to be served by the facility for which the financial 
assistance is to be extended there is a need for an increase in 
such service (taking into consideration reasonably forseeable 
future needs) which the existing public utility is not able to 
meet through its existing facilities or through an expansion 
which it agrees to undertake. Not more than $7,000,000 
approximated to carry out titles I and II of this Act may be 
expended annually for such projects.

                             [separability

  [Sec. 705. Notwithstanding any other evidence of the intent 
of Congress, it is hereby declared to be the intent of Congress 
that if any provision of this Act or the application thereof to 
any persons or circumstances shall be adjudged by any court of 
competent jurisdiction to be invalid such judgment shall not 
affect, impair, or invalidate the remainder of this Act or its 
application to other persons and circumstances, but shall be 
confined in its operation to the provision of this Act or the 
application thereof to the persons and circumstances directly 
involved in the controversy in which such judgment shall have 
been rendered.

                          [application of act

  [Sec. 706. As used in this Act, the terms ``State'', 
``States'', and ``United States'' include the several States, 
the District of Columbia, the Commonwealth of Puerto Rico, the 
Virgin Islands, Guam, and American Samoa.

                             [annual report

  [Sec. 707. The Secretary shall make a comprehensive and 
detailed annual report to the Congress of his operations under 
this Act for each fiscal year beginning with the fiscal year 
ending June 30, 1966. Such report shall be printed and shall be 
transmitted to the Congress not later than April 1 of the year 
following the fiscal year with respect to which such report is 
made.

                        [use of other facilities

  [Sec. 708. (a) The Secretary is authorized to delegate to the 
heads of other departments and agencies of the Federal 
Government any of the Secretary's functions, powers, and duties 
this Act as he may deem appropriate, and to authorize the 
redelegation of such functions, powers, and duties by the heads 
of such departments and agencies.
  [(b) Departments and agencies of the Federal Government shall 
exercise their powers, duties, and functions in such manner as 
will assist in carrying out the objectives of this Act.
  [(c) Funds authorized to be appropriated under this Act may 
be transferred between departments and agencies of the 
Government, if such funds are used for the purposes for which 
they are specifically authorized and appropriated.

                             [appropriation

  [Sec. 709. There are hereby authorized to be appropriated 
such sums as may be necessary to carry out those provisions of 
the Act for which specific authority for appropriations is not 
otherwise provided in this Act, except that there are hereby 
authorized to be appropriated to carry out those provisions of 
the Act for which specific authority for appropriations is not 
otherwise provided in this Act not to exceed $25,000,000 for 
the fiscal year ending September 30, 1982. Appropriations 
authorized under this Act shall remain available until expended 
unless otherwise provided by appropriations Acts.

                               [penalties

  [Sec. 710. (a) Whoever makes any statement knowing it to be 
false, or whoever will fully overvalues any security, for the 
purpose of obtaining for himself or for any applicant any 
financial assistance under section 101, 201, or 403 or any 
extension thereof by renewal, deferment or action, or 
otherwise, or the acceptance, release, or substitution of 
security therefor, or for the purpose of influencing in any way 
the action of the Secretary or for the purpose of obtaining 
money, property, or anything of value, under this Act, shall be 
punished by a fine of not more than $10,000 or by imprisonment 
for not more than five years, or both.
  [(b) Whoever, being connected in any capacity with the 
Secretary, in the administration of this Act first, embezzles, 
abstracts, purloins, or willfully misappleis any moneys, funds, 
securities, or other things of value, whether belonging to him 
or pledged or otherwise entrusted to him, or second, with 
intent to defraud the Secretary or any other body politic or 
corporate, or any individual, or to deceive any officer, 
auditor, or examiner, makes any false entry in any book, report 
or statement of or to the Secretary, or without being duly 
authorized draws any orders of issues, puts forth, or assigns 
any note, debenture, bond, or other obligation, or draft, bill 
of exchange, mortgage, judgment, or decree thereof, or third, 
with intent to defraud participates or shares in or receives 
directly or indirectly any money, profit, property, or benefit 
through any transaction, loan, grant, commission, contract, or 
any other act of the Secretary, or fourth, gives any 
unauthorized information concerning any future action of plan 
of the Secretary which might affect the value of securities, or 
having such knowledge invests or speculates, directly or 
indirectly, in the securities or property of any company or 
corporation receiving loans, grants, or other assistance from 
the Secretary, shall be punished by imprisonment for not more 
than five years, or both.

         [employment of expediters and administrative employees

  [Sec. 711. No financial assistance shall be extended by the 
Secretary under section 101, 201, 202, or 403 to any business 
enterprise unless the owners, partners, or officers of such 
business enterprise first, certify to the Secretary the names 
of any attorneys, agents, and other persons engaged by or on 
behalf of such business enterprise for the purpose of 
expediting applications made to the Secretary for assistance of 
any sort, under this Act, and the fees paid or to be paid to 
any such person; and second, execute an agreement binding such 
business enterprise, for a peirod of two years after such 
assistance is rendered by the Secretary to such business 
enterprise, to refrain from employing tendering any office or 
employment to, or retaining for professional services, any 
person who, on the date such assistance or any part thereof was 
rendered, or within one year prior thereto, shall have served 
as an officer, attorney, agent, or employee, occupying a 
position or engaging in activities which the Secretary shall 
have determined involve discretion with respect to the granting 
of assistance under this Act.

              [prevailing rate of wage and forth-hour week

  [Sec. 712. All laborers and mechanics employed by contractors 
or subcontractors on projects assisted by the Secretary under 
this Act shall be paid wages at rates not less than those 
prevailing on smiliar construction in the locality as 
determined by the Secretary of Labor in accordance with the 
Davis-Bacon Act, as amended (40 U.S.C. 276a-276a-5). The 
Secretary shall not extend any financial assistance under 
sections 101, 201, 202, 403, 903, and 1003, for such project 
without first obtaining adequate assurance that these labor 
standards will be maintained upon the cosntruction work. The 
Secretary of Labor shall have, with respect to the labor 
standards specified in this provision, the authority and 
functions sent forth in Reoganization Plan Numbered 14 of 1950 
(15 F.R. 3176; 64 Stat. 1267; 5 U.S.C. 133z15), and section 2 
of the Act of June 13, 1964, as amended (40 U.S.C. 276c).

                        [record of applications

  [Sec. 713. The Secretary shall maintain as a permanent part 
of the records of the Department of Commerce a list of 
applications approved for financial assistance under section 
101, 201, 202, or 403, which shall be kept avaialble for public 
inspection during the regualr business hours of the Department 
of Commerce. The following information shall be posted in such 
list as soon as each application is approved; first, the name 
of the applicant and, in the case of corporate applications, 
the names of the officers and directors thereof, second, the 
amount and duration of the loan or grant for which application 
is made, third, the purposes for which the proceeds of the loan 
or grant are to be used, and fourth, a general description of 
the security offered in the case of a loan.

                           [records and audit

  [Sec. 714. (a) Each recipient of assistance under this Act 
shall keep such records as the Secretary shall prescribe, 
including records which fully disclose the amount and the 
disposition by such recipient of the proceeds of such 
assistance the total cost of the project or undertaking in 
connection with which such assistance is given or used, and the 
amount and nature of that portion of the cost of the project or 
undertaking supplied by other sources, and such other records 
as will facilitate an effective audit.
  [(b) The Secretary and the Comptroller General of the United 
States, or any of their duly authorized representatives, shall 
have access for the purpose of audit and examination to any 
books, documents, papers, and records of the recipient that are 
pertinent to assistance received under this Act.

                         [conforming amendment

  [Sec. 715. All benefits heretofore specially made available 
(and not subsequently revoked) under other Federal programs to 
persons or to public or private organizations, corporations, or 
entities in areas designated by the Secretry as ``redevelopment 
areas'' under section 5 of the Area Redevelopment Act, are 
hereby also extended, insofar as practicable, to such areas as 
may be designated as ``redevelopment areas'' or ``economic 
development centers'' under the authority of section 401 or 403 
of this Act: Provided, however, That this section shall not be 
construed as limiting such administrative discretion as may 
have been conferred under any other law.
  [Sec. 716. All financial and technical assistance authorized 
under this Act shall be in addition to any Federal assistance 
previously authorized, and no provision hereof shall be 
construed as authorizing or permitting any reduction or 
diminution in the proportional amount of Federal assistance to 
which any State or other entity eligible under this Act would 
otherwise be entitled under the provisions of any other Act.

           [TITLE VIII--ECONOMIC RECOVERY FOR DISASTER AREAS

                           [purpose of title

  [Sec. 801. (a) It is the purpose of this title to provide 
assistance for the economic recovery, after the period of 
emergency aid and replacement of essential facilities and 
services, of any major disaster area which has suffered a 
dislocation of its economy of sufficient severity to require 
first, assistance in planning for development to replace that 
lost in the major disaster; second, continued coordination of 
assistance available under Federal-aid programs; and third, 
continued assistance toward the restoration of the employment 
base.
  [(b) As used in this title, the term ``major disaster'' means 
a major disaster declared by the President in accordance with 
the Disaster Relief and Emergency Assistance Act.

                      [disaster recovery planning

  [Sec. 802. (a)(1) In the case of any area affected by a major 
disaster the Governor may request the President for assistance 
under this title. The Governor, within thirty days after 
authorization of such assistance by the President, shall 
designate a Recovery Planning Council for such area or for each 
part thereof.
  [(2) Such Recovery Planning Council shall be composed of not 
less than five members, a majority of whom shall be local 
elected officials of political subdivisions within the affected 
areas, at least one representative of the State, and a 
representative of the Federal Government appointed by the 
President in accordance with paragraph (3) of this subsection. 
During the major disaster, the Federal coordinating officer 
shall also serve on the Recovery Planning Council.
  [(3) The Federal representative on such Recovery Planning 
Council may be the Chairman of the Federal Regional Council for 
the affected area, or a member of the Federal Regional Council 
designated by the Chairman of such Regional Council. The 
Federal representative on such Recovery Planning Council may be 
the Federal Cochairman of the Regional Commission established 
pursuant to title V of this Act, or the Appalachian Regional 
Development Act of 1965, or his designee, where all of the area 
affected by a major disaster is within the boundaries of such 
Commission.
  [(4) The Governor may designate an existing 
multijurisdictional organization as the Recovery Planning 
Council where such organization complies with paragraph (2) of 
this subsection with the addition of State and Federal 
represenatatives except that if all or part of an area affected 
by a major disaster is within the jurisdiction of an existing 
multijurisdictional organization established under title VI of 
this Act or title III of the Appalachian Regional Development 
Act of 1965, such organization, with the addition of State and 
Federal representatives in accordance with paragraph (2) of 
this subsection, shall be designated by the Governor as the 
Recovery Planning Council. In any case in which such title III 
or IV organizations is designated as the Recovery Planning 
Council under this paragraph, some local elected officials of 
political subdivisions within the affected areas must be 
appointed to serve on such Recovery Planning Council. Where 
possible, the organization designated as the Recovery Planning 
Council shall be or shall be subsequently designated as the 
appropriate agency required by section 204 of the Demonstration 
Cities and Metropolitan Development Act of 1966 (42 U.S.C. 
3334) and by the Intergovernmental Cooperation Act of 1968 
(Public Law 90-577; 82 Stat. 1098).
  [(5) The Recovery Planning Council shall include private 
citizens as members to the extent feasible, and shall provide 
for and encourage public participation in its deliberations and 
decisions.
  [(b) The Recovery Planning Council first, shall review 
existing plans for the affected area; and second, may recommend 
to the Governor and responsible local governments such 
revisions as it determines necessary for the economic recovery 
of the area, including the development of new plans and the 
preparation of a recovery investment plan for the 5-year period 
following the declaration of the major disaster. The Recovery 
Planning Council shall accept as one element of the recovery 
investment plans determinations made under section 406(c) of 
the Disaster Relief and Emergency Assistance Act.
  [(c)(1) A recovery investment plan prepared by a Recovery 
Planning Council may recommend the revision, deletion, 
reprogramming, or additional approval of Federal-aid projects 
and programs within the area--
          [(A) for which application has been made but approval 
        not yet granted;
          [(B) for which funds have been obligated or approval 
        granted but construction not yet begun;
          [(C) for which funds have been or are scheduled to be 
        apportioned within the five years after the declaration 
        of the disaster;
          [(D) which may otherwise be available to the area 
        under any State schedule or revised State schedule of 
        priorities; or
          [(E) which may reasonably be anticipated as becoming 
        available under existing programs.
  [(2) Upon the recommendation of the Recovery Planning Council 
and the request for the Governor, any funds for projects or 
programs identified pursuant to paragraph (1) of this 
subsection may, to any extent consistent with appropriation 
Acts, be placed in reserve by the responsible Federal agency 
for use in accordance with such recommendations. Upon the 
request of the Governor and with the concurrence of affected 
local governments, such funds may be transferred to the 
Recovery Planning Council to be expended in the implementation 
of the recovery investment plan, except that no such transfer 
may be made unless such expenditure is for a project or program 
for which such funds originally were made available by an 
appropriation Act.

       [public works and development facilities grants and loans

  [Sec. 803. (a) The President is authorized to provide funds 
to any Recovery Planning Council for the implementation of a 
recovery investment plan by public bodies. Such funds may be 
used--
          [(1) to make loans for the acquisition or development 
        of land and improvements for public works, public 
        service, or development facility usage, including the 
        acquisition or development of parks or open spaces, and 
        the acquisition, construction, rehabilitation, 
        alteration, expansion, or improvement of such 
        facilities, including related machinery and equipment, 
        and
          [(2) to make supplementary grants to increase the 
        Federal share for projects for which funds are reserved 
        pursuant to subsection (c)(2) of section 802 of this 
        Act, or other Federal-aid projects in the affected 
        area.
  [(b) Grants and loans under this section may be made to any 
State, local government, or private or public nonprofit 
organization representing any area or part thereof affected by 
a major disaster.
  [(c) No supplementary grant shall increase the Federal share 
of the cost of any project to greater than 90 per centum, 
except in the case of a grant for the benefit of Indians or 
Alaska Natives, or in the case of any State or local government 
which the President determines has exhausted its effective 
taxing and borrowing capacity.
  [(d) Loans under this section shall bear interest at a rate 
determined by the Secretary of the Treasury taking into 
consideration the current average market yield on outstanding 
marketable obligations of the United States with remaining 
periods to maturity comparable to the average maturities of 
such loans, adjusted to the nearest one-eighth of 1 per centum 
per annum.
  [(e) Financial assistance under this title shall not be 
extended to assist establishments relocating from one area to 
another or to assist subcontractors whose purpose is to divest, 
or whose economic success is dependent upon divesting, other 
contractors or subcontractors of contracts therefore 
customarily performed by them. Such limitations shall not be 
construed to prohibit assistance for the expansion of an 
existing business entity through the establishment of a new 
branch, affiliate, or subsidiary of such entity if the 
Secretary of Commerce finds that the establishment of such 
branch, affiliate, or subsidiary will not result in an increase 
in unemployment of the area of original location or in any 
other area where such entity conducts business operations, 
unless the Secretary has reason to believe that such branch, 
affiliate, or subsidiary is being established with the 
intention of closing down the operations of the existing 
business entity in the area of its original location or in any 
other area where it conducts such operations.

                            [loan guarantees

  [Sec. 804. The President is authorized to provide funds to 
Recovery Planning Councils to guarantee loans made to private 
borrowers by private lending institutions first, to aid in 
financing any project within any area affected by a major 
disaster for the purchase or development of land and facilities 
(including machinery and equipment) for industrial or 
commercial usage including the construction of new buildings, 
and rehabilitation of abandoned or unoccupied buildings, and 
the alteration, conversion or enlargement of existing buildngs; 
and second, for working capital in connection with projects in 
areas assisted under paragraph (1), upon application of such 
institution and upon such terms and conditions as the President 
may prescribe. No such guarantee shall at any time exceed 90 
per centum of the amount of the outstanding unpaid balance of 
such loan.

                         [technical assistance

  [Sec. 805. (a) In carrying out the purposes of this title the 
President is authorized to provide technical assistance which 
would be useful in facilitating economic recovery in areas 
affected by major disasters. Such assistance shall include 
project planning and feasibility studies, management and 
operational assistance, and studies evaluating the needs of, 
and developing potentialities for, economic recovery of such 
areas. Such assistance may be provided by the President 
directly, through the payment of funds authorized for this 
title to other departments or agencies of the Federal 
Government, through the employment of private individuals, 
partnerships, firms, corporations or suitable institutions, 
under contracts entered into for such purposes, or through 
grants-in-aid to appropriate public or private non-profit 
State, area, district, or local organization.
  [(b) The President is authorized to make grants to defray not 
to exceed 75 per centum of the administrative expenses of 
Recovery Planning Councils designated pursuant to section 802 
of this Act. In determining the amount of the non-Federal share 
of such costs or expenses, the President shall give due 
consideration to all contributions both in cash and in kind, 
fairly evaluated including but not limited to space, equipment, 
and services. Where practicable, grants-in-aid authorized under 
this subsection shall be used in conjunction with other 
available planning grants, to assure adequate and effective 
planning and economical use of funds.

   [TITLE IX--SPECIAL ECONOMIC DEVELOPMENT AND ADJUSTMENT ASSISTANCE

                                [purpose

  [Sec. 901. It is the purpose of this title to provide special 
economic development and adjustment assistance programs to help 
State and local areas meet special needs arising from actual or 
threatened severe unemployment arising from economic 
dislocation, including unemployment arising from actions of the 
Federal Government and from compliance with environmental 
requirements which remove economic activities from a locality, 
and economic adjustment problems resulting from severe changes 
in economic conditions (including long-term economic 
deterioration), and to encourage cooperative intergovernmental 
action to prevent or solve economic adjustment problems. 
Nothing in this title is intended to replace the efforts of the 
economic adjustment program of the Department of Defense.

                              [definition

  [Sec. 902. As used in this title, the term ``eligible 
recipient'' means a redevelopment area or economic development 
district established under title IV of this Act, an Indian 
tribe, a State, a city or other political subdivision of a 
State, or consortium of such political subdivisions.

                          [grants by secretary

  [Sec. 903. (a) (1) The Secretary is authorized to make grants 
directly to any eligible recipient in an area (A) which the 
Secretary has determined has experienced, or may reasonably be 
foreseen to be about to experience, a special need to meet an 
expected rise in unemployment, or other economic adjustment 
problems (including those caused by any action or decision of 
the Federal Government), or (B) which the Secretary determines 
has demonstrated long-term economic deterioration, to carry out 
or develop a plan which meets the requirements of subsection 
(b) of this section and which is approved by the Secretary, to 
use such grants for any of the following: public facilities, 
public services, business development, planning, unemployment 
compensation (in accordance with subsection (d) of this 
section), rent supplements, mortgage payment assistance, 
research, technical assistance, training, relocation of 
individuals and businesses, and other assistance which 
demonstrably furthers the economic adjustment objectives of 
this title.
  [(2) (A) Such grants may be used in direct expenditures by 
the eligible recipient or through redistribution by it to 
public and private entities in grants, loans, loan guarantees, 
payments to reduce interest on loan guarantees, or other 
appropriate assistance, but no grant shall be made by an 
eligible recipient to a private profitmaking entity.
  [(B) Grants for unemployment compensation shall be made to 
the State. Grants for any other purpose shall be made to any 
appropriate eligible recipient capable of carrying out such 
purpose.
  [(b) No plan shall be approved by the Secretary under this 
section unless such plan shall--
          [(1) identify each economic development and 
        adjustment need of the area for which assistance is 
        sought under this title;
          [(2) describe each activity planned to meet each such 
        need;
          [(3) explain the details of the method of carrying 
        out each such planned activity;
          [(4) contain assurances satisfactory to the Secretary 
        that the proceeds from the repayment of loans made by 
        the eligible recipient with funds granted under this 
        title will be used for economic adjustment; and
          [(5) be in such form and contain such additional 
        information as the Secretary shall prescribe.
  [(c) The Secretary to the extent practicable shall coordinate 
his activities in requiring plans and making grants and loans 
under this title with regional commissions, States, economic 
development districts and other appropriate planning and 
development organizations.
  [(d) In each case in which the Secretary determines a need 
for assistance under subsection (a) of this section due to an 
increase in unemployment and makes a grant under this section, 
the Secretary may transfer funds available for such grant to 
the Secretary of Labor and the Secretary of Labor is authorized 
to provide to any individual unemployed as a result of the 
dislocation for which such grant is made, such assistance as he 
deems appropriate while the individual is unemployed. Such 
assistance as the Secretary of labor may provide shall be 
available to an individual not otherwise disqualified under 
State law for unemployment compensaton benefits, as long as the 
individual's unemployment caused by the dislocation continues 
or until the individual is reemployed in a suitable position, 
but no longer than one year after the unemployment commences. 
Such assistance for a week of employment shall not exceed the 
maximum weekly amount authorized under the unemployment 
compensation law of the State in which the dislocation 
occurred, and the amount of assistance under this subsection 
shall be reduced by any amount of unemployment compensation or 
of private income protection insurance compensation available 
to such individual for such week of employment. The Secretary 
of Labor is directed to provide such assistance through 
agreements with States which, in his judgment, have an adequate 
system for administering such assistance through existing State 
agencies.

                        [reports and evaluation

  [Sec. 904. (a) Each eligible recipient which receives 
assistance under this title shall annually during the period 
such assistance continues make a full and complete report to 
the Secretary, in such manner as the Secretary shall prescribe, 
and such report shall contain an evaluation of the 
effectiveness of the economic assistance provided under this 
title in meeting the need it was designed to alleviate and the 
purposes of this title.
  [(b) The Secretary shall include in the annual report 
pursuant to section 707 of this Act a consolidated report with 
his recommendations, if any, on the assistance authorized under 
this title, in a form which he deems appropriate.

                    [authorization of appropriations

  [Sec. 905. There is authorized to be appropriated to carry 
out this title not to exceed $75,000,000 for the fiscal year 
ending June 30, 1975, and $100,000,000 for the fiscal year 
ending June 30, 1976, not to exceed $25,000,000 for the 
transition quarter ending September 30, 1976, and not to exceed 
$100,000,000 per fiscal year for the fiscal years ending 
September 30, 1977, September 30, 1978, September 30, 1979, 
September 30, 1980, and September 30, 1981, and not to exceed 
$33,000,000 for the fiscal year ending September 30, 1982.

                  [TITLE X--JOB OPPORTUNITIES PROGRAM

                         [statement of purpose

  [Sec. 1001. It is the purpose of this title to provide 
emergency financial assistance to stimulate, maintain or expand 
job creating activities in areas, both urban and rural, which 
are suffering from unusually high levels of unemployment.

                              [definitions

  [Sec. 1002. For the purpose of this title the term `eligible 
area' means any area, which the Secretary of Labor designates 
as an area which has a rate of unemployment equal to or in 
excess of 7 per centum for the most recent calendar quarter or 
any area designated pursuant to section 204(c) of the 
Comprehensive Employment and Training Act of 1973 which has 
unemployment equal to or in excess of 7 per centum with special 
consideration given to areas with unemployment rates above the 
national average.

                          [program authorized

  [Sec. 1003. (a) To carry out the purposes of this title, the 
Secretary of Commerce, in accordance with the provisions of 
this title, is authorized from funds appropriated and made 
available under section 1007 of this title to provide financial 
assistance to programs and projects identified through the 
review process described in section 1004 to expand or 
accelerate the job creating impact of such programs or projects 
for unemployed persons in eligible areas. Programs and projects 
for which funds are made available under this title shall not 
be approved until the officials of the appropriate units of 
general government in the affected areas have an adequate 
opportunity to comment on the specific proposal.
  [(b) Whenever funds are made available by the Secretary of 
Commerce under this title for any progam or project, the head 
of the department, agency, or instrumentality of the Federal 
Government administering the law authorizing such assistance 
shall, except as otherwise provided in this subsection, 
administer the law authorizing such assistance in accordance 
with all applicable provisions of that law, except provisions 
relating to--
          [(1) requiring allocation of funds among the States,
          [(2) limits upon the total amount of such grants for 
        any period, and
          [(3) the Federal contribution to any State or local 
        government, whenever the President or head of such 
        department, agency, or instrumentality of the Federal 
        Government determines that any non-Federal contribution 
        cannot reasonably be obtained by the State or local 
        government concerned.
  [(c) Where necessary to effectively carry out the purposes of 
this title, the Secretary of Commerce is authorized to assist 
eligible areas in making applications for grants under this 
title.
  [(d) Notwithstanding any other provisions of this title, 
funds allocated by the Secretary of Commerce shall be available 
only for a program or project which the Secretary indentifies 
and selects pursuant to this subsection, and which can be 
initiated or implemented promptly and substantially completed 
within twelve months after allocation is made. In identifying 
and selecting programs and projects pursuant to this 
subsection, the Secretary shall first, give priority to 
programs and projects which are most effective in creating and 
maintaining productive employment, including permanent and 
skilled employment measured as the amount of such direct and 
indirect employment generated or supported by the additional 
expenditures of Federal funds under this title, and second, 
consider the appropriations of the proposed activity to the 
number and needs of unemployed persons in the eligible area.
  [(e)(1) The Secretary, if the national unemployment rate is 
equal to or exceeds 7 per centum for the most recent calendar 
quarter, shall expedite and give priority to grant applications 
submitted for such areas having unemployment in excess of the 
national average rate of unemployment for the most recent 
calendar quarter. Seventy per centum of the funds appropriated 
pursuant to this title shall be available only for grants in 
areas as defined in the first sentence of this subsection.
  [(2) Not more than 15 per centum of all amounts appropriated 
to carry out this title shall be available under this title for 
projects or programs within any one State, except that in the 
case of Guam, Virgin Islands, and American Samoa, not less than 
one-half of 1 per centum in the aggregate shall be available 
for such projects or programs.

                            [program review

  [Sec. 1004. (a) Within forty-five days after any funds are 
appropriated to the Secretary to carry out the purposes of this 
title, after the date of enactment of the Public Works and 
Economic Development Act Amendments of 1976, each department, 
agency, or instrumentality of the Federal Government, each 
regional commission established by section 101 of the 
Appalachian Regional Development Act of 1965 or pursuant to 
section 502 of this Act, shall first, complete a review of its 
budget, plans, and programs and including State, substate, and 
local development plans filed with such department, agency or 
commission; second, evaluate the job creation effectiveness of 
programs and projects for which funds are proposed to be 
obligated in the calendar year and additional programs and 
projects (including new or revised programs and projects 
submitted under subsection (b) for which funds could be 
obligated in such year with Federal financial assistance under 
this title; and third, submit to the Secretary of Commerce 
recommendations for programs and projects which have the 
greatest potential to stimulate the creation of jobs for 
unemployed persons in eligible areas. Within forty-five days of 
the receipt of such recommendations the Secretary of Commerce 
shall review such recommendations, and after consultation with 
such department, agency, instrumentality, regional commission, 
State, or local government make allocations of funds in 
accordance with section 1003(d) of this title.
  [(b) States and political subdivisions in any eligible area 
may, pursuant to subsection (a), submit to the appropriate 
department, agency, or instrumentality of the Federal 
Government (or regional commission) program and project 
applications for Federal financial assistance provided under 
this title.
  [(c) The Secretary, in reviewing programs and projects 
recommended for any eligible area shall give priority to 
programs and projects originally sponsored by States and 
political subdivisions, including, but not limited to, new or 
revised programs and projects submitted in accordance with this 
section.
  [Sec. 1005. The Secretary of Commerce shall prescribe such 
rules, regulations, and procedures to carry out the provisions 
of this title as will assure that adequate consideration is 
given to the relative needs of applicants for assistance in 
rural eligible areas and the relative needs of applicants for 
assistance in urban eligible areas and to any equitable 
distribution of funds authorized under this title between rural 
and urban eligible applicants unless this would require project 
grants to be made in areas which do not meet the criteria of 
this title.

                    [authorization of appropriations

  [Sec. 1006. (a) There are hereby authorized to be 
appropriated to carry out the provisions of this title 
$81,250,000 for each calendar quarter of a fiscal year during 
which the national average unemployment is equal to or exceeds 
7 per centum on the average. No further appropriations of funds 
is authorized under this section if a determination is made 
that the national average rate of unemployment has receded 
below an average of 7 per centum for the most recent calendar 
quarter as determined by the Secretary of Labor.
  [(b) Funds authorized by subsecton (a) are available for 
grants by the Secretary when the national average unemployment 
is equal to or in excess of an average of 7 per centum for the 
most recent calendar quarter. If the national average 
unemployment rate recedes below an average of 7 per centum for 
the most recent calendar quarter, the authority of the 
Secretary to make grants or obligate funds under this title is 
terminated. Grants may not be made until the national average 
unemployment has equalled or exceeded an average of 7 per 
centum for the most recent calendar quarter.
  [(c) Funds authorized to carry out this title shall be in 
addition to, and not in lieu of, any amounts authorized by 
other provisions of law.

                           [termination date

  [Sec. 1007. Notwithstanding any other provision of this 
title, no further obligations of funds appropriated under this 
title shall be made by the Secretary of Commerce after 
September 30, 1981.

                          [construction costs

  [Sec. 1008. No program or project originally approved for 
funds under an existing program shall be determined to be 
ineligible for Federal financial assistance under this title 
solely because of increased construction costs.]

SEC. 2. FINDINGS AND DECLARATION.

  (a) Findings.--Congress finds that--
          (1) the maintenance of the national economy at a high 
        level is vital to the best interests of the United 
        States, but that some of our regions, counties, and 
        communities are suffering substantial and persistent 
        unemployment and underemployment that cause hardship to 
        many individuals and their families, and waste 
        invaluable human resources;
          (2) to overcome this problem the Federal Government, 
        in cooperation with the States, should help areas and 
        regions of substantial and persistent unemployment and 
        underemployment to take effective steps in planning and 
        financing their public works and economic development;
          (3) Federal financial assistance, including grants 
        for public works and development facilities to 
        communities, industries, enterprises, and individuals 
        in areas needing development should enable such areas 
        to help themselves achieve lasting improvement and 
        enhance the domestic prosperity by the establishment of 
        stable and diversified local economies and improved 
        local conditions, if such assistance is preceded by and 
        consistent with sound, long-range economic planning; 
        and
          (4) under the provisions of this Act, new employment 
        opportunities should be created by developing and 
        expanding new and existing public works and other 
        facilities and resources rather than by merely 
        transferring jobs from one area of the United States to 
        another.
  (b) Declaration.--Congress declares that, in furtherance of 
maintaining the national economy at a high level--
          (1) the assistance authorized by this Act should be 
        made available to both rural and urban areas;
          (2) such assistance should be made available for 
        planning for economic development prior to the actual 
        occurrences of economic distress in order to avoid such 
        condition; and
          (3) such assistance should be used for long-term 
        economic rehabilitation in areas where long-term 
        economic deterioration has occurred or is taking place.

                TITLE I--ECONOMIC DEVELOPMENT COMMISSION

SEC. 101. ESTABLISHMENT OF ECONOMIC DEVELOPMENT COMMISSION.

  (a) Establishment.--There is established an Economic 
Development Commission which shall be an independent 
establishment in the executive branch.
  (b) Appointment of Federal Cochairman.--The Commission shall 
headed by a Federal Cochairman of the Economic Development 
Commission (hereinafter in this Act referred to as the 
``Federal Cochairman'') who shall be appointed by the President 
by and with the advice and consent of the Senate.
  (c) Duties.--It shall be the duty of the Federal Cochairman 
to carry out duties vested in the Federal Cochairman under this 
Act.

SEC. 102. ESTABLISHMENT OF REGIONAL COMMISSIONS.

  (a) Establishment.--The Federal Cochairman shall establish 
for each region established by section 106 an Economic 
Development Regional Commission (hereinafter in this Act 
referred to as a ``Regional Commission'').
  (b) Membership.--
          (1) In general.--Each Regional Commission shall be 
        composed of 1 Federal member and 1 State member from 
        each participating State in the region represented by 
        the Regional Commission.
          (2) Federal cochairman.--The Federal member of each 
        Regional Commission shall be the Federal Cochairman.
          (3) State members.--Each State member of a Regional 
        Commission shall be the chief executive officer of the 
        State. The State members of a Regional Commission shall 
        elect a Cochairman from among such State members for a 
        term of not less than 1 year.
          (4) Alternates.--
                  (A) State alternates.--Each State member of a 
                Regional Commission may have a single alternate 
                appointed by the chief executive officer of the 
                State from among members of the chief executive 
                officer's cabinet or the chief executive 
                officer's personal staff.
                  (B) Federal alternate.--The President, by and 
                with the advice and consent of the Senate, 
                shall appoint an alternate for the Federal 
                Cochairman.
                  (C) Duties.--An alternate shall vote in the 
                event of the absence, death, disability, 
                removal, or resignation of the State or Federal 
                representative for which he or she is an 
                alternate. A State alternate shall not be 
                counted toward the establishment of a quorum of 
                the Commission in any instance in which a 
                quorum of the State members is required to be 
                present.
  (c) Decisionmaking.--
          (1) Voting.--Decisions by a Regional Commission shall 
        require an affirmative vote of the Federal Cochairman 
        (or the Federal Cochairman's alternate) and of the 
        majority of the State members.
          (2) Quorum.--No decision of a Regional Commission 
        involving Commission policy, developing investment 
        strategies, or allocating funds among States may be 
        made without the Federal Cochairman (or the Federal 
        Cochairman's alternate) and a quorum of the State 
        members present. For purposes of this Act, the Federal 
        Cochairman (or the Federal Cochairman's alternate) and 
        a majority of the State members shall constitute a 
        quorum.
  (d) Pay.--
          (1) Federal cochairman.--The Federal Cochairman shall 
        be compensated by the Federal Government at the rate 
        prescribed for level III of the Executive Schedule 
        under section 5314 of title 5, United States Code.
          (2) Federal cochairman's alternate.--The Federal 
        Cochairman's alternate shall be compensated by the 
        Federal Government at the rate prescribed for level V 
        of the Executive Schedule under section 5316 of title 
        5, United States Code, and when not serving as an 
        alternate for the Federal Cochairman shall perform such 
        functions and duties as are delegated by the Federal 
        Cochairman.
          (3) State members and their alternates.--Each State 
        member and the State member's alternate shall be 
        compensated by the State which they represent at the 
        rate established by law of such State.

SEC. 103. COOPERATION OF FEDERAL AGENCIES.

  Each Federal department and agency, in accordance with 
applicable laws and within the limits of available funds, shall 
cooperate with each Regional Commission in order to assist the 
Regional Commission in carrying out the functions of the 
Regional Commission.

SEC. 104. ADMINISTRATIVE EXPENSES.

  (a) Payment by States.--Fifty percent of the administrative 
expenses of a Regional Commission (other than the expenses of 
the Federal Cochairman) shall be paid by the States in the 
region represented by the Regional Commission and the remaining 
50 percent of such expenses shall be paid by the Federal 
Government. The expenses of the Federal Cochairman, the Federal 
Cochairman's alternate, and the Federal Cochairman's staff 
shall be paid solely by the Federal Government.
  (b) Determination of State Share.--The share of the 
administrative expenses to be paid by each State shall be 
determined by the Regional Commission. The Federal Cochairman 
shall not participate or vote in such determination.
  (c) Delinquent Payments.--No assistance authorized by this 
Act shall be furnished to any State or to any political 
subdivision or resident of a State, nor shall the State member 
of a Regional Commission participate or vote in any 
determination by the Regional Commission, while such State is 
delinquent in the payment of such State's share of the 
administrative expenses of the Regional Commission.

SEC. 105. ADMINISTRATIVE POWERS.

  To carry out its duties under this Act, consistent with 
regulations issued by the Federal Cochairman, a Regional 
Commission may take any of the following actions:
          (1) Adopt, amend, and repeal bylaws and rules 
        governing the conduct of the Regional Commission's 
        business and the performance of its functions.
          (2) Appoint and fix the pay of an executive director 
        and such other personnel as may be necessary to enable 
        the Regional Commission to carry out its functions; 
        except that the compensation for any individual so 
        appointed shall not exceed the rate of basic pay for 
        level V of the Executive Schedule and no member, 
        officer, or employee of the Regional Commission, other 
        than the Federal Cochairman, the Federal Cochairman's 
        alternate, employees of the Federal Cochairman, and any 
        Federal employees detailed under paragraph (3), shall 
        be deemed a Federal employee for any purpose.
          (3) Request the head of a Federal department or 
        agency to detail to temporary duty with the Regional 
        Commission such personnel within the administrative 
        jurisdiction of such head as the Regional Commission 
        may need for carrying out its functions, and each such 
        detail shall be without loss of seniority, pay, or 
        other employee status.
          (4) Arrange for the services of personnel from any 
        State or local government or any subdivision or agency 
        thereof, or any intergovernmental agency.
          (5) Make arrangements, including contracts, with any 
        participating State government for inclusion in a 
        suitable retirement and employee benefits system of 
        such of its personnel as may not be eligible for, or 
        continue in, another governmental retirement or 
        employee benefit system, or otherwise provide for such 
        coverage of its personnel. The Director of the Office 
        of Personnel Management is authorized to contract with 
        a Regional Commission for continued coverage of any 
        Regional Commission employee who, on a date in the 6-
        month period ending on the date of Regional Commission 
        employment, was a Federal employee, in the retirement 
        program and other employee benefit programs of the 
        Federal Government.
          (6) Accept, use, and dispose of gifts or donations of 
        services or property, real, personal, or mixed, 
        tangible or intangible.
          (7) Subject to the requirements of the Federal 
        Property and Administrative Services Act of 1949, enter 
        into and perform such contracts, leases, cooperative 
        agreements, or other transactions as may be necessary 
        in carrying out the Regional Commission's functions and 
        on such terms as the Regional Commission may deem 
        appropriate, with any department, agency, or 
        instrumentality of the United States, or with any 
        person, firm, association, or corporation.
          (8) Take such other actions and incur such other 
        expenses as may be necessary and appropriate.

SEC. 106. ESTABLISHMENT OF REGIONS.

  (a) In General.--For the purposes of this Act, there are 
established 8 regions of the United States as follows:
          (1) Region I.--Region I shall be composed of the 
        States of Alabama, Florida, Georgia, Kentucky, 
        Mississippi, North Carolina, South Carolina, and 
        Tennessee.
          (2) Region II.--Region II shall be composed of the 
        States of Arkansas, Louisiana, New Mexico, Oklahoma, 
        and Texas.
          (3) Region III.--Region III shall be composed of the 
        States of Illinois, Indiana, Michigan, Minnesota, Ohio, 
        and Wisconsin.
          (4) Region IV.--Region IV shall be composed of the 
        States of Colorado, Iowa, Kansas, Missouri, Montana, 
        Nebraska, North Dakota, South Dakota, Utah, and 
        Wyoming.
          (5) Region V.--Region V shall be composed of the 
        State of California.
          (6) Region VI.--Region VI shall be composed of the 
        States of Alaska, Arizona, Hawaii, Idaho, Nevada, 
        Oregon, and Washington and American Samoa, Guam, the 
        Marshall Islands, Micronesia, and the Northern Mariana 
        Islands.
          (7) Region VII.--Region VII shall be composed of the 
        States of Delaware, Maryland, New Jersey, New York, 
        Pennsylvania, Virginia, and West Virginia and the 
        District of Columbia.
          (8) Region VIII.--Region VIII shall be composed of 
        the States of Connecticut, Maine, Massachusetts, New 
        Hampshire, Rhode Island, and Vermont and Puerto Rico 
        and the Virgin Islands.
  (b) Participation Not Required.--No State shall be required 
to participate in any program under this Act.

      TITLE II--GRANTS FOR PUBLIC WORKS AND DEVELOPMENT FACILITIES

SEC. 201. DIRECT AND SUPPLEMENTARY GRANTS.

  (a) In General.--Upon the application of any eligible 
recipient, a Regional Commission may--
          (1) make direct grants for the acquisition or 
        development of land and improvements for public works, 
        public service, or development facility usage, and the 
        acquisition, design and engineering, construction, 
        rehabilitation, alteration, expansion, or improvement 
        of such facilities, including related machinery and 
        equipment, within an area described in section 502(a), 
        if the Regional Commission finds that--
                  (A) the project for which financial 
                assistance is sought will directly or 
                indirectly--
                          (i) tend to improve the 
                        opportunities, in the area where such 
                        project is or will be located, for the 
                        successful establishment or expansion 
                        of industrial or commercial plants or 
                        facilities;
                          (ii) otherwise assist in the creation 
                        of additional long-term employment 
                        opportunities for such area; or
                          (iii) primarily benefit the long-term 
                        unemployed and members of low-income 
                        families;
                  (B) the project for which a grant is 
                requested will fulfill a pressing need of the 
                area, or part thereof, in which it is, or will 
                be, located;
                  (C) the area for which a project is to be 
                undertaken has an approved investment strategy 
                as provided by section 503 and such project is 
                consistent with such strategy; and
                  (D) in the case of an area described in 
                section 502(a)(4), the project to be undertaken 
                will provide immediate useful work to 
                unemployed and underemployed persons in that 
                area; and
          (2) make supplementary grants in order to enable the 
        States and other entities within areas described in 
        section 502(a) to take maximum advantage of designated 
        Federal grant-in-aid programs (as defined in subsection 
        (c)(4)), direct grants-in-aid authorized under this 
        section, and Federal grant-in-aid programs authorized 
        by the Watershed Protection and Flood Prevention Act 
        (68 Stat. 666), and the 11 watersheds authorized by the 
        Flood Control Act of December 22, 1944 (58 Stat. 887), 
        for which they are eligible but for which, because of 
        their economic situation, they cannot supply the 
        required matching share.
  (b) Cost Sharing.--Subject to subsection (c), the amount of 
any direct grant under this subsection for any project shall 
not exceed 50 percent of the cost of such project.
  (c) Requirements Applicable to Supplementary Grants.--
          (1) Amount of supplementary grants.--
                  (A) In general.--Except as provided by 
                subparagraph (B), the amount of any 
                supplementary grant under this section for any 
                project shall not exceed the applicable 
                percentage established by regulations 
                promulgated by the Federal Cochairman, but in 
                no event shall the non-Federal share of the 
                aggregate cost of any such project (including 
                assumptions of debt) be less than 20 percent of 
                such cost.
                  (B) Exceptions.--Notwithstanding subparagraph 
                (A)--
                          (i) in the case of a grant to an 
                        Indian tribe, a Regional Commission may 
                        reduce the non-Federal share below the 
                        percentage specified in subparagraph 
                        (A) or may waive the non-Federal share;
                          (ii) in the case of any State or a 
                        political subdivision of the State 
                        which the Regional Commission 
                        determines has exhausted its effective 
                        taxing and borrowing capacity, the 
                        Regional Commission shall reduce the 
                        non-Federal share below the percentage 
                        specified in subparagraph (A) or shall 
                        waive the non-Federal share in the case 
                        of such a grant for a project in an 
                        area described in section 502(a)(4); 
                        and
                          (iii) in case of any community 
                        development corporation which the 
                        Regional Commission determines has 
                        exhausted its effective borrowing 
                        capacity, the Regional Commission may 
                        reduce the non-Federal share below the 
                        percentage specified in subparagraph 
                        (A) or waive the non-Federal share in 
                        the case of such a grant for a project 
                        in an area described in section 
                        502(a)(4).
          (2) Form of supplementary grants.--Supplementary 
        grants shall be made by a Regional Commission, in 
        accordance with such regulations as the Federal 
        Cochairman may prescribe, by increasing the amounts of 
        direct grants authorized under this section or by the 
        payment of funds appropriated under this Act to the 
        heads of the departments, agencies, and 
        instrumentalities of the Federal Government responsible 
        for the administration of the applicable Federal 
        programs.
          (3) Federal share limitations specified in other 
        laws.--Notwithstanding any requirement as to the amount 
        or sources of non-Federal funds that may otherwise be 
        applicable to the Federal program involved, funds 
        provided under this subsection shall be used for the 
        sole purpose of increasing the Federal contribution to 
        specific projects in areas described in section 502(a) 
        under such programs above the fixed maximum portion of 
        the cost of such project otherwise authorized by the 
        applicable law.
          (4) Designated federal grant-in-aid programs 
        defined.--In this subsection, the term ``designated 
        Federal grant-in-aid programs'' means such existing or 
        future Federal grant-in-aid programs assisting in the 
        construction or equipping of facilities as the Federal 
        Cochairman may, in furtherance of the purposes of this 
        Act, designate as eligible for allocation of funds 
        under this section.
          (5) Consideration of relative need in determining 
        amount.--In determining the amount of any supplementary 
        grant available to any project under this section, a 
        Regional Commission shall take into consideration the 
        relative needs of the area and the nature of the 
        projects to be assisted.
  (d) Regulations.--The Federal Cochairman shall prescribe 
rules, regulations, and procedures to carry out this section 
which will assure that adequate consideration is given to the 
relative needs of eligible areas. In prescribing such rules, 
regulations, and procedures the Federal Cochairman shall 
consider among other relevant factors--
          (1) the severity of the rates of unemployment in the 
        eligible areas and the duration of such unemployment; 
        and
          (2) the income levels of families and the extent of 
        underemployment in eligible areas.
  (e) Review and Comment Upon Projects by Local Governmental 
Authorities.--The Federal Cochairman shall prescribe 
regulations which will assure that appropriate local 
governmental authorities have been given a reasonable 
opportunity to review and comment upon proposed projects under 
this section.

SEC. 202. CONSTRUCTION COST INCREASES.

  In any case where a grant (including a supplemental grant) 
has been made by a Regional Commission under this title for a 
project and after such grant has been made but before 
completion of the project, the cost of such project based upon 
the designs and specifications which were the basis of the 
grant has been increased because of increases in costs, the 
amount of such grant may be increased by an amount equal to the 
percentage increase, as determined by the Regional Commission, 
in such costs, but in no event shall the percentage of the 
Federal share of such project exceed that originally provided 
for in such grant.

SEC. 203. USE OF FUNDS IN PROJECTS CONSTRUCTED UNDER PROJECTED COST.

  In any case where a grant (including a supplemental grant) 
has been made by a Regional Commission under this title for a 
project, and after such grant has been made but before 
completion of the project, the cost of such project based upon 
the designs and specifications which were the basis of the 
grant has decreased because of decreases in costs, such 
underrun funds may be used to improve the project either 
directly or indirectly as determined by the Regional 
Commission.

SEC. 204. CHANGED PROJECT CIRCUMSTANCES.

  In any case where a grant (including a supplemental grant) 
has been made by a Regional Commission under this title for a 
project, and after such grant has been made but before 
completion of the project, the purpose or scope of such project 
based upon the designs and specifications which were the basis 
of the grant has changed, the Regional Commission may approve 
the use of grant funds on such changed project if the Regional 
Commission determines that such changed project meets the 
requirements of this title and that such changes are necessary 
to enhance economic development in the area.

   TITLE III--SPECIAL ECONOMIC DEVELOPMENT AND ADJUSTMENT ASSISTANCE

SEC. 301. STATEMENT OF PURPOSE.

  The purpose of this title to provide special economic 
development and adjustment assistance programs to help State 
and local areas meet special needs arising from actual or 
threatened severe unemployment arising from economic 
dislocation, including unemployment arising from actions of the 
Federal Government and from compliance with environmental 
requirements which remove economic activities from a locality, 
and economic adjustment problems resulting from severe changes 
in economic conditions (including long-term economic 
deterioration), and to encourage cooperative intergovernmental 
action to prevent or solve economic adjustment problems. 
Nothing in this title is intended to replace the efforts of the 
economic adjustment program of the Department of Defense.

SEC. 302. GRANTS BY REGIONAL COMMISSIONS.

  (a) In General.--A Regional Commission is authorized to make 
grants directly to any eligible recipient in an area which the 
Regional Commission determines, in accordance with criteria to 
be established by the Federal Cochairman by regulation--
          (1) has experienced, or may reasonably be foreseen to 
        be about to experience, a special need to meet an 
        expected rise in unemployment, or other economic 
        adjustment problems (including those caused by any 
        action or decision of the Federal Government); or
          (2) has demonstrated long-term economic 
        deterioration.
  (b) Purposes.--Amounts from grants under subsection (a) shall 
be used by an eligible recipient to carry out or develop an 
investment strategy which--
          (1) meets the requirements of section 503; and
          (2) is approved by the Regional Commission.
  (c) Types of Assistance.--In carrying out an investment 
strategy using amounts from grants under subsection (a), an 
eligible recipient may provide assistance for any of the 
following:
          (1) Public facilities.
          (2) Public services.
          (3) Business development.
          (4) Planning.
          (5) Research and technical assistance.
          (6) Administrative expenses.
          (7) Training.
          (8) Relocation of individuals and businesses.
          (9) Other assistance which demonstrably furthers the 
        economic adjustment objectives of this title.
  (d) Direct Expenditure or Redistribution by Recipient.--
Amounts from grants under subsection (a) may be used in direct 
expenditures by the eligible recipient or through 
redistribution by the eligible recipient to public and private 
entities in grants, loans, loan guarantees, payments to reduce 
interest on loan guarantees, or other appropriate assistance, 
but no grant shall be made by an eligible recipient to a 
private profit-making entity.
  (e) Coordination.--A Regional Commission to the extent 
practicable shall coordinate the activities relating to the 
requirements for investment strategies and making grants and 
loans under this title with other Federal programs, States, 
economic development districts, and other appropriate planning 
and development organizations.
  (f) Base Closings and Realignments.--
          (1) Location of projects.--In any case in which a 
        Regional Commission determines a need for assistance 
        under subsection (a) due to the closure or realignment 
        of a military installation, the Regional Commission may 
        make such assistance available for projects to be 
        carried out on the military installation and for 
        projects to be carried out in communities adversely 
        affected by the closure or realignment.
          (2) Interest in property.--Notwithstanding any other 
        provision of law, a Regional Commission may provide to 
        an eligible recipient any assistance available under 
        this Act for a project to be carried out on a military 
        installation that is closed or scheduled for closure or 
        realignment without requiring that the eligible 
        recipient have title to the property or a leasehold 
        interest in the property for any specified term.

SEC. 303. ANNUAL REPORTS BY RECIPIENT.

  Each eligible recipient which receives assistance under this 
title from a Regional Commission shall annually during the 
period such assistance continue to make a full and complete 
report to the Regional Commission, in such manner as the 
Regional Commission shall prescribe, and such report shall 
contain an evaluation of the effectiveness of the economic 
assistance provided under this title in meeting the need it was 
designed to alleviate and the purposes of this title.

SEC. 304. SALE OF FINANCIAL INSTRUMENTS IN REVOLVING LOAN FUNDS.

  Any loan, loan guarantee, equity, or other financial 
instrument in the portfolio of a revolving loan fund, including 
any financial instrument made available using amounts from a 
grant made before the effective date of the Economic 
Development Partnership Act of 1995, may be sold, encumbered, 
or pledged at the discretion of the grantee of the Fund, to a 
third party provided that the net proceeds of the transaction--
          (1) shall be deposited into the Fund and may only be 
        used for activities which are consistent with the 
        purposes of this title; and
          (2) shall be subject to the financial management, 
        accounting, reporting, and auditing standards which 
        were originally applicable to the grant.

SEC. 305. TREATMENT OF REVOLVING LOAN FUNDS.

  (a) In General.--Amounts from grants made under this title 
which are used by an eligible recipient to establish a 
revolving loan fund shall not be treated, except as provided by 
subsection (b), as amounts derived from Federal funds for the 
purposes of any Federal law after such amounts are loaned from 
the fund to a borrower and repaid to the fund.
  (b) Exceptions.--Amounts described in subsection (a) which 
are loaned from a revolving loan fund to a borrower and repaid 
to the fund--
          (1) may only be used for activities which are 
        consistent with the purposes of this title; and
          (2) shall be subject to the financial management, 
        accounting, reporting, and auditing standards which 
        were originally applicable to the grant.
  (c) Regulations.--Not later than 30 days after the effective 
date of the Economic Development Partnership Act of 1995, the 
Federal Cochairman shall issue regulations to carry out 
subsection (a).
  (d) Public Review and Comment.--Before issuing any final 
guidelines or administrative manuals governing the operation of 
revolving loan funds established using amounts from grants 
under this title, the Federal Cochairman shall provide 
reasonable opportunity for public review of and comment on such 
guidelines and administrative manuals.
  (e) Applicability to Past Grants.--The requirements of this 
section applicable to amounts from grants made under this title 
shall also apply to amounts from grants made, before the 
effective date of the Economic Development Partnership Act of 
1995, under title I of this Act, as in effect on the day before 
such effective date.

       TITLE IV--TECHNICAL ASSISTANCE, RESEARCH, AND INFORMATION

SEC. 401. TECHNICAL ASSISTANCE.

  (a) In General.--In carrying out its duties under this Act, a 
Regional Commission may provide technical assistance which 
would be useful in alleviating or preventing conditions of 
excessive unemployment or underemployment to areas which the 
Regional Commission finds have substantial need for such 
assistance. Such assistance shall include project planning and 
feasibility studies, management and operational assistance, 
establishment of business outreach centers, and studies 
evaluating the needs of, and development potentialities for, 
economic growth of such areas.
  (b) Procedures and Terms.--
          (1) Manner of providing assistance.--Assistance may 
        be provided by a Regional Commission through--
                  (A) members of the Regional Commission's 
                staff;
                  (B) the payment of funds authorized for this 
                section to departments or agencies of the 
                Federal Government;
                  (C) the employment of private individuals, 
                partnerships, firms, corporations, or suitable 
                institutions under contracts entered into for 
                such purposes; or
                  (D) grants-in-aid to appropriate public or 
                private nonprofit State, area, district, or 
                local organizations.
          (2) Repayment terms.--A Regional Commission, in its 
        discretion, may require the repayment of assistance 
        provided under this subsection and prescribe the terms 
        and conditions of such repayment.
  (c) Grants Covering Administrative Expenses.--
          (1) In general.--A Regional Commission may make 
        grants to defray not to exceed 75 percent of the 
        administrative expenses of organizations which the 
        Regional Commission determines to be qualified to 
        receive grants-in-aid under subsections (a) and (b); 
        except that in the case of a grant under this 
        subsection to an Indian tribe, the Regional Commission 
        is authorized to defray up to 100 percent of such 
        expenses.
          (2) Determination of non-federal share.--In 
        determining the amount of the non-Federal share of such 
        costs or expenses, a Regional Commission shall give due 
        consideration to all contributions both in cash and in 
        kind, fairly evaluated, including contributions of 
        space, equipment, and services.
          (3) Use of grants with planning grants.--Where 
        practicable, grants-in-aid authorized under this 
        subsection shall be used in conjunction with other 
        available planning grants to assure adequate and 
        effective planning and economical use of funds.
  (d) Availability of Technical Information; Federal 
Procurement.--A Regional Commission shall aid areas described 
in section 502(a) and other areas by furnishing to interested 
individuals, communities, industries, and enterprises within 
such areas any assistance, technical information, market 
research, or other forms of assistance, information, or advice 
which would be useful in alleviating or preventing conditions 
of excessive unemployment or underemployment within such areas. 
The Regional Commission may furnish the procurement divisions 
of the various departments, agencies, and other 
instrumentalities of the Federal Government with a list 
containing the names and addresses of business firms which are 
located in areas described in section 502(a) and which are 
desirous of obtaining Government contracts for the furnishing 
of supplies or services, and designating the supplies and 
services such firms are engaged in providing.

SEC. 402. ECONOMIC DEVELOPMENT PLANNING.

  (a) Direct Grants.--
          (1) In general.--A Regional Commission may, upon 
        application of any State, or city, or other political 
        subdivision of a State, or sub-State planning and 
        development organization (including an area described 
        in section 502(a) or an economic development district), 
        make direct grants to such State, city, or other 
        political subdivision, or organization to pay up to 80 
        percent of the cost for economic development planning.
          (2) Planning projects specifically included.--The 
        planning for cities, other political subdivisions, and 
        sub-State planning and development organizations 
        (including areas described in section 502(a) and 
        economic development districts) assisted under this 
        section shall include systematic efforts to reduce 
        unemployment and increase incomes.
          (3) Planning process.--The planning shall be a 
        continuous process involving public officials and 
        private citizens in analyzing local economies, defining 
        development goals, determining project opportunities, 
        and formulating and implementing a development program.
          (4) Coordination of assistance under section 
        401(c).--The assistance available under this section 
        may be provided in addition to assistance available 
        under section 401(c) but shall not supplant such 
        assistance.
  (b) Compliance With Review Procedure.--The planning 
assistance authorized under this title shall be used in 
conjunction with any other available Federal planning 
assistance to assure adequate and effective planning and 
economical use of funds.

             TITLE V--ELIGIBILITY AND INVESTMENT STRATEGIES

                          PART A--ELIGIBILITY

SEC. 501. ELIGIBLE RECIPIENT DEFINED.

  In this Act, the term ``eligible recipient'' means an area 
described in section 502(a), an economic development district 
designated under section 510, an Indian tribe, a State, a city 
or other political subdivision of a State, or a consortium of 
such political subdivisions, or a public or private nonprofit 
organization or association acting in cooperation with 
officials of such political subdivisions.

SEC. 502. AREA ELIGIBILITY.

  (a) Certification.--In order to be eligible for assistance 
under title II, an applicant seeking assistance to undertake a 
project in an area shall certify, as part of an application for 
such assistance, that the area on the date of submission of 
such application meets 1 or more of the following criteria:
          (1) The area has a per capita income of 80 percent or 
        less of the national average.
          (2) The area has an unemployment rate 1 percent above 
        the national average percentage for the most recent 24-
        month period for which statistics are available.
          (3) The area has experienced or is about to 
        experience a sudden economic dislocation resulting in 
        job loss that is significant both in terms of the 
        number of jobs eliminated and the effect upon the 
        employment rate of the area.
          (4) The area is a community or neighborhood (defined 
        without regard to political or other subdivisions or 
        boundaries) which the Federal Cochairman determines has 
        one or more of the following conditions:
                  (A) A large concentration of low-income 
                persons.
                  (B) Rural areas having substantial out-
                migration.
                  (C) Substantial unemployment.
  (b) Documentation.--A certification made under subsection (a) 
shall be supported by Federal data, when available, and in 
other cases by data available through the State government. 
Such documentation shall be accepted by a Regional Commission 
unless it is determined to be inaccurate. The most recent 
statistics available shall be used.
  (c) Special Rule.--An area which a Regional Commission 
determines has 1 or more of the conditions described in 
subsection (a)(4)--
          (1) shall not be subject to the requirements of 
        subparagraphs (A) and (C) of section 201(a)(1); and
          (2) shall not be eligible to meet the requirements of 
        section 510(a)(1)(B).
  (d) Prior Designations.--Any designation of a redevelopment 
area made before the effective date of the Economic Development 
Partnership Act of 1995 shall not be effective after such 
effective date.

SEC. 503. INVESTMENT STRATEGY.

  A Regional Commission may provide assistance under titles II 
and III to an applicant for a project only if the applicant 
submits to the Regional Commission, as part of an application 
for such assistance, and the Regional Commission approves an 
investment strategy which--
          (1) identifies the economic development problems to 
        be addressed using such assistance;
          (2) identifies past, present, and projected future 
        economic development investments in the area receiving 
        such assistance and public and private participants and 
        sources of funding for such investments;
          (3) sets forth a strategy for addressing the economic 
        problems identified pursuant to paragraph (1) and 
        describes how the strategy will solve such problems;
          (4) provides a description of the project necessary 
        to implement the strategy, estimates of costs, and 
        timetables; and
          (5) provides a summary of public and private 
        resources expected to be available for the project.

SEC. 504. APPROVAL OF PROJECTS.

  Only applications for grants or other assistance under this 
Act for specific projects shall be approved which are certified 
by the State member of the Regional Commission representing 
such applicant and determined by the Federal Cochairman--
          (1) to be included in a State investment strategy 
        approved by the Regional Commission;
          (2) to have adequate assurance that the project will 
        be properly administered, operated, and maintained; and
          (3) to otherwise meet the requirements for assistance 
        under this Act.

                 PART B--ECONOMIC DEVELOPMENT DISTRICTS

SEC. 510. DESIGNATION OF ECONOMIC DEVELOPMENT DISTRICTS AND ECONOMIC 
                    DEVELOPMENT CENTERS.

  (a) In General.--In order that economic development projects 
of broader geographic significance may be planned and carried 
out, a Regional Commission may--
          (1) designate appropriate ``economic development 
        districts'' within the United States with the 
        concurrence of the States in which such districts will 
        be wholly or partially located, if--
                  (A) the proposed district is of sufficient 
                size or population, and contains sufficient 
                resources, to foster economic development on a 
                scale involving more than a single area 
                described in section 502(a);
                  (B) the proposed district contains at least 1 
                area described in section 502(a);
                  (C) the proposed district contains 1 or more 
                areas described in section 502(a) or economic 
                development centers identified in an approved 
                district investment strategy as having 
                sufficient size and potential to foster the 
                economic growth activities necessary to 
                alleviate the distress of the areas described 
                in section 502(a) within the district; and
                  (D) the proposed district has a district 
                investment strategy which includes adequate 
                land use and transportation planning and 
                contains a specific program for district 
                cooperation, self-help, and public investment 
                and is approved by the State or States affected 
                and by the Regional Commission;
          (2) designate as ``economic development centers'', in 
        accordance with such regulations as the Federal 
        Cochairman shall prescribe, such areas as the Regional 
        Commission may deem appropriate, if--
                  (A) the proposed center has been identified 
                and included in an approved district investment 
                strategy and recommended by the State or States 
                affected for such special designation;
                  (B) the proposed center is geographically and 
                economically so related to the district that 
                its economic growth may reasonably be expected 
                to contribute significantly to the alleviation 
                of distress in the areas described in section 
                502(a) of the district; and
                  (C) the proposed center does not have a 
                population in excess of 250,000 according to 
                the most recent Federal census.
          (3) provide financial assistance in accordance with 
        the criteria of this Act, except as may be herein 
        otherwise provided, for projects in economic 
        development centers designated under subsection (a)(2), 
        if--
                  (A) the project will further the objectives 
                of the investment strategy of the district in 
                which it is to be located:
                  (B) the project will enhance the economic 
                growth potential of the district or result in 
                additional long-term employment opportunities 
                commensurate with the amount of Federal 
                financial assistance requested; and
                  (C) the amount of Federal financial 
                assistance requested is reasonably related to 
                the size, population, and economic needs of the 
                district;
          (4) subject to the 20 percent non-Federal share 
        required for any project by section 201(c), increase 
        the amount of grant assistance authorized by section 
        201 for projects within areas described in section 
        502(a), by an amount not to exceed 10 percent of the 
        aggregate cost of any such project, in accordance with 
        such regulations as the Federal Cochairman shall 
        prescribe if--
                  (A) the area described in section 502(a) is 
                situated within a designated economic 
                development district and is actively 
                participating in the economic development 
                activities of the district; and
                  (B) the project is consistent with an 
                approved investment strategy.
  (b) Authorities.--In designating economic development 
districts and approving district investment strategies under 
subsection (a), a Regional Commission may, under regulations 
prescribed by the Federal Cochairman--
          (1) invite the several States to draw up proposed 
        district boundaries and to identify potential economic 
        development centers;
          (2) cooperate with the several States--
                  (A) in sponsoring and assisting district 
                economic planning and development groups; and
                  (B) in assisting such district groups to 
                formulate district investment strategies; and
          (3) encourage participation by appropriate local 
        governmental authorities in such economic development 
        districts.
  (c) Termination or Modification of Designations.--The Federal 
Cochairman shall by regulation prescribe standards for the 
termination or modification of economic development districts 
and economic development centers designated under the authority 
of this section.
  (d) Definitions.--In this Act, the following definitions 
apply:
          (1) Economic development district.--The term 
        ``economic development district'' refers to any area 
        within the United States composed of cooperating areas 
        described in section 502(a) and, where appropriate, 
        designated economic development centers and neighboring 
        counties or communities, which has been designated by a 
        Regional Commission as an economic development 
        district. Such term includes any economic development 
        district designated under section 403 of this Act, as 
        in effect on the day before the effective date of the 
        Economic Development Partnership Act of 1995.
          (2) Economic development center.--The term ``economic 
        development center'' refers to any area within the 
        United States which has been identified as an economic 
        development center in an approved investment strategy 
        and which has been designated by a Regional Commission 
        as eligible for financial assistance under this Act in 
        accordance with the provisions of this section.
          (3) Local government.--The term ``local government'' 
        means any city, county, town, parish, village, or other 
        general-purpose political subdivision of a State.
  (e) Parts of Economic Development Districts Not Within Areas 
Described in Sec. 502(a).--A Regional Commission is authorized 
to provide the financial assistance which is available to an 
area described in section 502(a) under this Act to those parts 
of an economic development district which are not within an 
area described in section 502(a), when such assistance will be 
of a substantial direct benefit to an area described in section 
502(a) within such district. Such financial assistance shall be 
provided in the same manner and to the same extent as is 
provided in this Act for an area described in section 502(a); 
except that nothing in this subsection shall be construed to 
permit such parts to receive the increase in the amount of 
grant assistance authorized in subsection (a)(4).

                        TITLE VI--ADMINISTRATION

SEC. 601. FUNCTIONS OF ECONOMIC DEVELOPMENT COMMISSION.

  In administering the Economic Development Commission, the 
Federal Cochairman shall ensure that the Commission--
          (1) serves as a central information clearinghouse on 
        matters relating to economic development, economic 
        adjustment, disaster recovery, and defense conversion 
        programs and activities of the Federal and State 
        governments, including political subdivisions of the 
        States; and
          (2) helps potential and actual applicants for 
        economic development, economic adjustment, disaster 
        recovery, and defense conversion assistance under 
        Federal, State, and local laws in locating and applying 
        for such assistance, including financial and technical 
        assistance.

SEC. 602. CONSULTATION WITH OTHER PERSONS AND AGENCIES.

  (a) Consultation on Problems Relating to Employment.--The 
Federal Cochairman is authorized from time to time to call 
together and confer with any persons, including representatives 
of labor, management, agriculture, and government, who can 
assist in meeting the problems of area and regional 
unemployment or underemployment.
  (b) Consultation on Administration of Act.--The Federal 
Cochairman may make provisions for such consultation with 
interested departments and agencies as the Federal Cochairman 
may deem appropriate in the performance of the functions vested 
in the Federal Cochairman by this Act.

SEC. 603. ADMINISTRATION, OPERATION, AND MAINTENANCE.

  No Federal assistance shall be approved under this Act unless 
the Federal Cochairman is satisfied that the project for which 
Federal assistance is granted will be properly and efficiently 
administered, operated, and maintained.

SEC. 604. TREATMENT OF ECONOMIC DEVELOPMENT ADMINISTRATION EMPLOYEES.

  In considering applications for employment at the Economic 
Development Commission or in a Regional Commission, preference 
shall be given to individuals who are employees of the Economic 
Development Administration on the effective date of the 
Economic Development Partnership Act of 1995.

                        TITLE VII--MISCELLANEOUS

SEC. 701. POWERS OF FEDERAL COCHAIRMAN.

  (a) In General.--In performing the Federal Cochairman's 
duties under this Act, the Federal Cochairman is authorized 
to--
          (1) adopt, alter, and use a seal, which shall be 
        judicially noticed;
          (2) subject to the civil-service and classification 
        laws, select, employ, appoint, and fix the compensation 
        of such personnel as may be necessary to carry out the 
        provisions of this Act;
          (3) hold such hearings, sit and act at such times and 
        places, and take such testimony, as the Federal 
        Cochairman may deem advisable;
          (4) request directly from any executive department, 
        bureau, agency, board, commission, office, independent 
        establishment, or instrumentality information, 
        suggestions, estimates, and statistics needed to carry 
        out the purposes of this Act; and each department, 
        bureau, agency, board, commission, office, 
        establishment, or instrumentality is authorized to 
        furnish such information, suggestions, estimates, and 
        statistics directly to the Federal Cochairman;
          (5) under regulations prescribed by the Federal 
        Cochairman, assign or sell at public or private sale, 
        or otherwise dispose of for cash or credit, in the 
        Federal Cochairman's discretion and upon such terms and 
        conditions and for such consideration as the Federal 
        Cochairman determines to be reasonable, any evidence of 
        debt, contract, claim, personal property, or security 
        assigned to or held by the Federal Cochairman in 
        connection with assistance extended under this Act, and 
        collect or compromise all obligations assigned to or 
        held by the Federal Cochairman in connection with such 
        assistance until such time as such obligations may be 
        referred to the Attorney General for suit or 
        collection;
          (6) deal with, complete, renovate, improve, 
        modernize, insure, rent, or sell for cash or credit, 
        upon such terms and conditions and for such 
        consideration as the Federal Cochairman determines to 
        be reasonable, any real or personal property conveyed 
        to, or otherwise acquired by the Federal Cochairman in 
        connection with assistance extended under this Act;
          (7) pursue to final collection, by way of compromise 
        or other administrative action, prior to reference to 
        the Attorney General, all claims against third parties 
        assigned to the Federal Cochairman in connection with 
        assistance extended this Act;
          (8) acquire, in any lawful manner and in accordance 
        with the requirements of the Federal Property and 
        Administrative Services Act of 1949, any property 
        (real, personal, or mixed, tangible or intangible), 
        whenever necessary or appropriate to the conduct of the 
        activities authorized under this Act;
          (9) in addition to any powers, functions, privileges, 
        and immunities otherwise vested in the Federal 
        Cochairman, take any action, including the procurement 
        of the services of attorneys by contract, determined by 
        the Federal Cochairman to be necessary or desirable in 
        making, purchasing, servicing, compromising, modifying, 
        liquidating, or otherwise administratively dealing with 
        assets held in connection with financial assistance 
        extended under this Act;
          (10) employ experts and consultants or organizations 
        as authorized by section 3109 of title 5, United States 
        Code, compensate individuals so employed at rates not 
        in excess of $100 per diem, including travel time, and 
        allow them, while away from their homes or regular 
        places of business, travel expenses (including per diem 
        in lieu of subsistence) as authorized by section 5703 
        of title 5, United States Code, for persons in the 
        Government service employed intermittently, while so 
        employed, except that contracts for such employment may 
        be renewed annually;
          (11) sue and be sued in any court of record of a 
        State having general jurisdiction or in any United 
        States district court, and jurisdiction is conferred 
        upon such district court to determine such 
        controversies without regard to the amount in 
        controversy; but no attachment, injunction, 
        garnishment, or other similar process, mesne or final, 
        shall be issued against the Federal Cochairman or the 
        Federal Cochairman's property;
          (12) make discretionary grants, pursuant to 
        authorities otherwise available to a Regional 
        Commission under this Act and without regard to the 
        requirements of section 504, to implement significant 
        regional initiatives, to take advantage of special 
        development opportunities, or to respond to emergency 
        economic distress in the region from the funds withheld 
        from distribution to the Regional Commissions; except 
        that the aggregate amount of such discretionary grants 
        in any fiscal year may not exceed 10 percent of the 
        amounts appropriated under title VIII for such fiscal 
        year; and
          (13) establish such rules, regulations, and 
        procedures as the Federal Cochairman considers 
        appropriate in carrying out the provisions of this Act.
  (b) Deficiency Judgments.--The authority under subsection 
(a)(7) to pursue claims shall include the authority to obtain 
deficiency judgments or otherwise in the case of mortgages 
assigned to the Federal Cochairman.
  (c) Inapplicability of Certain Other Requirements.--Section 
3709 of the Revised Statutes of the United States shall not 
apply to any contract of hazard insurance or to any purchase or 
contract for services or supplies on account of property 
obtained by the Federal Cochairman as a result of assistance 
extended under this Act if the premium for the insurance or the 
amount of the insurance does not exceed $1,000.
  (d) Powers of Conveyance and Execution.--The power to convey 
and to execute, in the name of the Federal Cochairman, deeds of 
conveyance, deeds of release, assignments and satisfactions of 
mortgages, and any other written instrument relating to real or 
personal property or any interest therein acquired by the 
Federal Cochairman pursuant to the provisions of this Act may 
be exercised by the Federal Cochairman, or by any officer or 
agent appointed by the Federal Cochairman for such purpose, 
without the execution of any express delegation of power or 
power of attorney.

SEC. 702. ALLOCATION OF FUNDS.

  The Federal Cochairman shall establish a formula for the 
equitable allocation among the Regional Commissions of amounts 
appropriated to carry out this Act.

SEC. 703. PERFORMANCE MEASURES.

  The Federal Cochairman shall establish performance measures 
for grants and other assistance provided under this Act. Such 
performance measures shall be used to evaluate project 
proposals and conduct evaluations of projects receiving such 
assistance.

SEC. 704. MAINTENANCE OF STANDARDS.

  The Federal Cochairman shall continue to implement and 
enforce the provisions of section 712 of this Act, as in effect 
on the day before the effective date of the Economic 
Development Partnership Act of 1995.

SEC. 705. TRANSFER OF FUNCTIONS.

  The functions, powers, duties, and authorities and the 
assets, funds, contracts, loans, liabilities, commitments, 
authorizations, allocations, and records which are vested in or 
authorized to be transferred to the Secretary of the Treasury 
under section 29(b) of the Area Redevelopment Act, and all 
functions, powers, duties, and authorities under section 29(c) 
of such Act are hereby vested in the Federal Cochairman.

SEC. 706. DEFINITION OF STATE.

  In this Act, the terms ``State'', ``States'', and ``United 
States'' include the several States and each of the other 
political entities included in a region established by section 
106.

SEC. 707. ANNUAL REPORT TO CONGRESS.

  The Federal Cochairman shall transmit a comprehensive and 
detailed annual report to Congress of the Federal Cochairman's 
and each Regional Commission's operations under this Act for 
each fiscal year beginning with the fiscal year ending 
September 30, 1996. Such report shall be printed and shall be 
transmitted to Congress not later than April 1 of the year 
following the fiscal year with respect to which such report is 
made.

SEC. 708. USE OF OTHER FACILITIES.

  (a) Delegation of Functions to Other Federal Departments and 
Agencies.--The Federal Cochairman may delegate to the heads of 
other departments and agencies of the Federal Government any of 
the Federal Cochairman's functions, powers, and duties under 
this Act as the Federal Cochairman may deem appropriate, and to 
authorize the redelegation of such functions, powers, and 
duties by the heads of such departments and agencies.
  (b) Department and Agency Execution of Delegated Authority.--
Departments and agencies of the Federal Government shall 
exercise their powers, duties, and functions in such manner as 
will assist in carrying out the objectives of this Act.
  (c) Transfer Between Departments.--Funds authorized to be 
appropriated under this Act may be transferred between 
departments and agencies of the Government, if such funds are 
used for the purposes for which they are specifically 
authorized and appropriated.
  (d) Funds Transferred From Other Departments and Agencies.--
In order to carry out the objectives of this Act, the Federal 
Cochairman may accept transfers of funds from other departments 
and agencies of the Federal Government if the funds are used 
for the purposes for which (and in accordance with the terms 
under which) the funds are specifically authorized and 
appropriated. Such transferred funds shall remain available 
until expended, and may be transferred to and merged with the 
appropriations under the heading ``salaries and expenses'' by 
the Federal Cochairman to the extent necessary to administer 
the program.

SEC. 709. PENALTIES.

  (a) False Statements; Security Overvaluation.--Whoever makes 
any statement knowing it to be false, or whoever willfully 
overvalues any security, for the purpose of obtaining for such 
person or for any applicant any financial assistance under this 
Act or any extension of such assistance by renewal, deferment 
or action, or otherwise, or the acceptance, release, or 
substitution of security for such assistance, or for the 
purpose of influencing in any way the action of the Federal 
Cochairman or a Regional Commission or for the purpose of 
obtaining money, property, or anything of value, under this 
Act, shall be fined under title 18, United States Code, 
imprisoned for not more than 5 years, or both.
  (b) Embezzlement and Fraud-Related Crimes.--Whoever, being 
connected in any capacity with the Federal Cochairman or a 
Regional Commission, in the administration of this Act--
          (1) embezzles, abstracts, purloins, or willfully 
        misapplies any moneys, funds, securities, or other 
        things of value, whether belonging to such person or 
        pledged or otherwise entrusted to such person;
          (2) with intent to defraud the Federal Cochairman or 
        a Regional Commission or any other body politic or 
        corporate, or any individual, or to deceive any 
        officer, auditor, or examiner, makes any false entry in 
        any book, report, or statement of or to the Federal 
        Cochairman or a Regional Commission, or without being 
        duly authorized draws any orders or issues, puts forth, 
        or assigns any note, debenture, bond, or other 
        obligation, or draft, bill of exchange, mortgage, 
        judgment, or decree thereof;
          (3) with intent to defraud participates or shares in 
        or receives directly or indirectly any money, profit, 
        property, or benefit through any transaction, loan, 
        grant, commission, contract, or any other act of the 
        Federal Cochairman or a Regional Commission; or
          (4) gives any unauthorized information concerning any 
        future action of plan of the Federal Cochairman or a 
        Regional Commission which might affect the value of 
        securities, or having such knowledge invests or 
        speculates, directly or indirectly, in the securities 
        or property of any company or corporation receiving 
        loans, grants, or other assistance from the Federal 
        Cochairman or a Regional Commission,
shall be fined under title 18, United States Code, imprisoned 
for not more than 5 years, or both.

SEC. 710. EMPLOYMENT OF EXPEDITERS AND ADMINISTRATIVE EMPLOYEES.

  No financial assistance shall be extended by a Regional 
Commission under this Act to any business enterprise unless the 
owners, partners, or officers of such business enterprise--
          (1) certify to the Regional Commission the names of 
        any attorneys, agents, and other persons engaged by or 
        on behalf of such business enterprise for the purpose 
        of expediting applications made to the Regional 
        Commission for assistance of any sort, under this Act, 
        and the fees paid or to be paid to any such person; and
          (2) execute an agreement binding such business 
        enterprise, for a period of 2 years after such 
        assistance is rendered by the Regional Commission to 
        such business enterprise, to refrain from employing, 
        tendering any office or employment to, or retaining for 
        professional services, any person who, on the date such 
        assistance or any part thereof was rendered, or within 
        the 1-year period ending on such date, shall have 
        served as an officer, attorney, agent, or employee, 
        occupying a position or engaging in activities which 
        the Regional Commission determines involves discretion 
        with respect to the granting of assistance under this 
        Act.

SEC. 711. PERSONAL FINANCIAL INTERESTS.

  (a) In General.--Except as permitted by subsection (b), no 
State member or alternate and no officer or employee of a 
Regional Commission shall participate personally and 
substantially as member, alternate, officer, or employee, 
through decision, approval, disapproval, recommendation, the 
rendering of advice, investigation, or otherwise, in any 
proceeding, application, request for a ruling or other 
determination, contract, claim, controversy, or other 
particular matter in which, to the individual's knowledge, the 
individual, the individual's spouse, minor child, partner, 
organization (other than a State or political subdivision 
thereof) in which the individual is serving as officer, 
director, trustee, partner, or employee, or any person or 
organization with whom the individual is serving as officer, 
director, trustee, partner, or employee, or any person or 
organization with whom the individual is negotiating or has any 
arrangement concerning prospective employment, has a financial 
interest. Any individual who shall violate the provisions of 
this subsection shall be fined under title 18, United States 
Code, imprisoned for not more than 2 years, or both.
  (b) Exception.--Subsection (a) shall not apply if the State 
member, alternate, officer, or employee first advises the 
Regional Commission of the nature and circumstances of the 
proceeding, application, request for a ruling or other 
determination, contract, claim, controversy, or other 
particular matter and makes full disclosure of the financial 
interest and receives in advance a written determination made 
by the Regional Commission that the interest is not so 
substantial as to be deemed likely to affect the integrity of 
the services which the Regional Commission may expect from such 
State member, alternate, officer, or employee.
  (c) Salaries.--No State member or alternate of a Regional 
Commission shall receive any salary, or any contribution to or 
supplementation of salary for the individual's services on the 
Regional Commission from any source other than the State of the 
individual. No individual detailed to serve the Regional 
Commission under authority of section 105 shall receive any 
salary or any contribution to or supplementation of salary for 
the individual's services on the Regional Commission from any 
source other than the State, local, or intergovernmental 
department or agency from which he was detailed or from the 
Regional Commission. Any individual who shall violate the 
provisions of this subsection shall be fined under title 18, 
United States Code, imprisoned for not more than 1 year, or 
both.
  (d) Nonapplicability to Federal Officials.--Notwithstanding 
any other provision of this section, the Federal Cochairman (or 
the Federal Cochairman's alternate) and any Federal officers or 
employees detailed to duty with a Regional Commission pursuant 
to section 105 shall not be subject to such provisions but 
shall remain subject to sections 202 through 209 of title 18, 
United States Code.
  (e) Authority To Rescind Certain Agreements.--A Regional 
Commission may, in the Regional Commission's discretion, 
declare void and rescind any agreement to extend financial 
assistance under this Act entered into by the Regional 
Commission in relation to which the Regional Commission finds 
that there has been a violation of subsection (a) or (c) of 
this section or any of the provisions of sections 202 through 
209 of title 18, United States Code.

SEC. 712. MAINTENANCE OF RECORDS OF APPROVED APPLICATIONS FOR FINANCIAL 
                    ASSISTANCE; PUBLIC INSPECTION.

  (a) Maintenance of Record Required.--The Federal Cochairman 
shall maintain as a permanent part of the records of the 
Economic Development Commission a list of applications approved 
for financial assistance under this Act, which shall be kept 
available for public inspection during the regular business 
hours of the Economic Development Commission.
  (b) Posting to List.--The following information shall be 
posted in such list as soon as each application is approved:
          (1) The name of the applicant and, in the case of 
        corporate applications, the names of the officers and 
        directors thereof.
          (2) The amount and duration of the financial 
        assistance for which application is made.
          (3) The purposes for which the proceeds of the 
        financial assistance are to be used.

SEC. 713. RECORDS AND AUDIT.

  (a) Recordkeeping and Disclosure Requirements.--Each 
recipient of assistance under this Act shall keep such records 
as the Federal Cochairman shall prescribe, including records 
which fully disclose the amount and the disposition by such 
recipient of the proceeds of such assistance, the total cost of 
the project or undertaking in connection with which such 
assistance is given or used, and the amount and nature of that 
portion of the cost of the project or undertaking supplied by 
other sources, and such other records as will facilitate an 
effective audit.
  (b) Access to Books for Examination and Audit.--The Federal 
Cochairman and the Comptroller General of the United States, or 
any of their duly authorized representatives, shall have access 
for the purpose of audit and examination to any books, 
documents, papers, and records of the recipient that are 
pertinent to assistance received under this Act.

SEC. 714. PROHIBITION AGAINST A STATUTORY CONSTRUCTION WHICH MIGHT 
                    CAUSE DIMINUTION IN OTHER FEDERAL ASSISTANCE.

  All financial and technical assistance authorized under this 
Act shall be in addition to any Federal assistance previously 
authorized, and no provision of this Act shall be construed as 
authorizing or permitting any reduction or diminution in the 
proportional amount of Federal assistance to which any State or 
other entity eligible under this Act would otherwise be 
entitled under the provisions of any other Act.

SEC. 715. ACCEPTANCE OF APPLICANTS' CERTIFICATIONS.

  A Regional Commission may accept, when deemed appropriate, 
the applicants' certifications to meet the requirements of this 
Act.

                          TITLE VIII--FUNDING

SEC. 801. AUTHORIZATION OF APPROPRIATIONS.

  There is authorized to be appropriated to carry out this Act 
$340,000,000 per fiscal year for each of fiscal years 1996, 
1997, 1998, 1999, and 2000. Such sums shall remain available 
until expended.

SEC. 802. DEFENSE CONVERSION ACTIVITIES.

  In addition to the appropriations authorized by section 801, 
there are authorized to be appropriated to carry out this Act 
such sums as may be necessary to provide assistance for defense 
conversion activities. Such funding may include pilot projects 
for privatization and economic development activities for 
closed or realigned military installations. Such sums shall 
remain available until expended.

                      TITLE 5, UNITED STATES CODE

          * * * * * * *

                          PART III--EMPLOYEES

          * * * * * * *

                     Subpart D--Pay and Allowances

          * * * * * * *

                   CHAPTER 53--PAY RATES AND SYSTEMS

          * * * * * * *

              SUBCHAPTER II--EXECUTIVE SCHEDULE PAY RATES

          * * * * * * *

Sec. 5314. Positions at level III

  Level III of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Solicitor General of the United States.
          Under Secretary of Commerce, Under Secretary of 
        Commerce for Economic Affairs, Under Secretary of 
        Commerce for Export Administration and Under Secretary 
        of Commerce for Travel and Tourism.
          Under Secretaries of State (5).
          * * * * * * *
          Federal Cochairman of the Economic Development 
        Commission.
          * * * * * * *

Sec. 5316. Positions at level V

  Level V of the Executive Schedule applies to the following 
positions, for which the annual rate of basic pay shall be the 
rate determined with respect to such level under chapter 11 of 
title 2, as adjusted by section 5318 of this title:
          Administrator, Bonneville Power Administration, 
        Department of the Interior.
          Administrator of the National Capital Transportation 
        Agency.
          Associate Administrators of the Small Business 
        Administration (4).
          * * * * * * *
          [Administrator for Economic Development.]
          * * * * * * *
          Alternate for the Federal Cochairman of the Economic 
        Development Commission.
          * * * * * * *
                              ----------                              


              APPALACHIAN REGIONAL DEVELOPMENT ACT OF 1965

          * * * * * * *

                   findings and statement of purpose

  Sec. 2. (a) * * *
          * * * * * * *
  (c) 1995 Findings and Purposes.--The Congress further finds 
and declares that, while substantial progress has been made in 
fulfilling many of the objectives of this Act, rapidly changing 
national and global economies over the past decade have created 
new problems and challenges for rural areas throughout the 
Nation and especially for the Appalachian region. It is, 
therefore, also the purpose of this Act to assist the region in 
providing the infrastructure necessary for economic and human 
resource development, in developing its industry, in building 
entrepreneurial communities, in generating a diversified 
regional economy, and in making its industrial and commercial 
resources more competitive in national and world markets. It is 
further the purpose of this Act to provide a framework for 
coordinating Federal, State, and local initiatives to respond 
to the economic competitive challenge through improving the 
skills of the region's workforce, adapting and applying new 
technologies for the region's businesses, and improving the 
access of the region's businesses to the technical and 
financial resources necessary to their development. Finally, it 
is the purpose of this Act to address the needs of severely and 
persistently distressed and underdeveloped areas of the region 
so as to provide a fairer opportunity for the people of the 
region to share the quality of life generally enjoyed by 
citizens across this Nation.

              TITLE I--THE APPALACHIAN REGIONAL COMMISSION

                         membership and voting

  Sec. 101. (a) There is hereby established an Appalachian 
Regional Commission (hereinafter referred to as the 
``Commission'') which shall be composed of one Federal member, 
hereinafter referred to as the ``Federal Cochairman,'' 
appointed by the President by and with the advice and consent 
of the Senate, and one member from each participating State in 
the Appalachian region. The Federal Cochairman shall be one of 
the two Cochairmen of the Commission. Each State member shall 
be the Governor. The State members of the Commission shall 
elect a Cochairman of the Commission from among their number 
for a term of not less than one year. The Commission shall 
conduct at least one meeting each year with the Federal 
Cochairman and at least a majority of the State members 
present. The Commission may conduct such additional meetings by 
electronic means as the Commission considers advisable, 
including meetings to decide matters requiring an affirmative 
vote.
  (b) Except as provided in section 105, decisions by the 
Commission shall require the affirmative vote of the Federal 
Cochairman and of a majority of the State members (exclusive of 
members representing States delinquent under section 105). In 
matters coming before the Commission, the Federal Cochairman 
shall, to the extent practicable, consult with the Federal 
departments and agencies having an interest in the subject 
matter. [No decision involving Commission policy, approval of 
State, regional or subregional development plans or 
implementing investment programs, any modification or revision 
of the Appalachian Regional Commission Code, or any allocation 
of funds among the States may be made without a quorum of State 
members present.] No decision involving Commission policy, 
approval of State, regional, or subregional development plans 
or implementing investment programs, any modification or 
revision of the Appalachian Regional Commission Code, any 
allocation of funds among the State, or any designation of a 
distressed county or an economically competitive county may be 
made without a quorum of State members. The approval of project 
and grant proposals shall be a responsibility of the Commission 
and exercised in accordance with section 303 of this Act.
  (c) Each State member may have a single alternate, appointed 
by the Governor from among the members of the Governor's 
cabinet or the Governor's personal staff. The President, by and 
with the advice and consent of the Senate, shall appoint an 
alternate for the Federal Cochairman. An alternate shall vote 
in the event of the absence, death, disability, removal, or 
resignation of the State or Federal representative for which he 
is an alternate. A State alternate shall not be counted toward 
the establishment of a quorum of the Commission in any instance 
in which a quorum of the State members is required [to be 
present]. No Commission powers or responsibilities specified in 
the last two sentences of subsection (b) of this section, nor 
the vote of any Commission member, may be delegated to any 
person not a Commission member or who is not entitled to vote 
in Commission meetings.
          * * * * * * *

               administrative expenses of the commission

  Sec. 105. (a) * * *
  [(b) To carry out this section there is hereby authorized to 
be appropriated to the Commission to be available until 
expended, not to exceed $1,900,000 for the two-fiscal-year 
period ending June 30, 1971. To carry out this section there is 
hereby authorized to be appropriated to the Commission, to be 
available until expended not to exceed $2,700,000 for the two-
fiscal-year period ending June 30, 1973 (of such amount not to 
exceed $525,000 shall be available for expenses of the Federal 
cochairman, his alternate, and his staff), and not to exceed 
$3,000,000 for the two-fiscal-year period ending June 30, 1975 
(of such amount not to exceed $575,000 shall be available for 
expenses of the Federal Cochairman, his alternate, and his 
staff. To carry out this section there is hereby authorized to 
be appropriated to the Commission, to be available until 
expended, not to exceed $4,600,000 for the period beginning 
July 1, 1975, and ending September 30, 1977, (of such amount 
not to exceed $800,000 shall be available for expenses of the 
Federal Cochairman, his alternate, and his staff), and not to 
exceed $5,000,000 for the two-fiscal-year period ending 
September 30, 1979 (of such amount not to exceed $900,000 shall 
be available for expenses of the Federal cochairman, his 
alternate, and his staff), and not to exceed $6,700,000 for the 
two-fiscal-year period ending September 30, 1981 (of such 
amount not to exceed $1,100,000 shall be available for expenses 
of the Federal cochairman, his alternate, and his staff), and 
not to exceed $2,900,000 for the two-fiscal-year period ending 
September 30, 1982 (of such amount not to exceed $400,000 shall 
be available for expenses of the Federal cochairman, his 
alternate, and his staff).]
  (b) Authorization of Appropriations.--
          (1) In general.--There is authorized to be 
        appropriated to carry out this section $3,645,000 per 
        fiscal year for each of fiscal years 1996 through 2000. 
        Such sums shall remain available until expended.
          (2) Expenses of federal cochairman.--Of the amounts 
        appropriated pursuant to paragraph (1), not to exceed 
        $1,245,000 per fiscal year for each of fiscal years 
        1996 through 2000 shall be available for expenses of 
        the Federal Cochairman, the Federal Cochairman's 
        alternate, and the Federal Cochairman's staff.

                  administrative powers of commission

  Sec. 106. To carry out its duties under this Act, the 
Commission is authorized to--
          (1)  * * *
          * * * * * * *
          (7) subject to the requirements of the Federal 
        Property and Administrative Services Act of 1949, enter 
        into and perform such contracts, leases (including 
        [notwithstanding any other provision of law,] the lease 
        of office space for any term expiring no later than 
        September 30, [1982] 2000), cooperative agreements, or 
        other transactions as may be necessary in carrying out 
        its functions and on such terms as it may deem 
        appropriate, with any department, agency, or 
        instrumentality of the United States (which is hereby 
        so authorized to the extent not otherwise prohibited by 
        law) or with any State, or any political subdivision, 
        agency, or instrumentality thereof, or with any person, 
        firm, association, or corporation.
          (8) subject to the requirements of the Federal 
        Property and Administrative Services Act of 1949, 
        maintain a temporary office in the District of Columbia 
        and establish a permanent office at such a cental and 
        appropriate location as it may select and field offices 
        as such other places as it may deem appropriate.
          * * * * * * *

                 TITLE II--SPECIAL APPALACHIAN PROGRAMS

                          Part A--New Programs

                 Appalachian development highway system

  Sec. 201. (a) * * *
          * * * * * * *
    [(g) To carry out this section there is hereby authorized 
to be appropriated to the President, to be available until 
expended, $175,000,000 for the fiscal year ending June 30, 
1971; $175,000,000 for the fiscal year ending June 30, 1972; 
$180,000,000 for the fiscal year ending June 30, 1973; 
$180,000,000 for the fiscal year ending June 30, 1974; 
$185,000,000 for the fiscal year ending June 30, 1975; 
$185,000,000 for the fiscal year ending June 30, 1976; 
$185,000,000 for the fiscal year ending June 30, 1977; 
$250,000,000 for the fiscal year 1978; $300,000,000 for the 
fiscal year 1979; $300,000,000 for the fiscal year 1980; and 
$215,000,000 for fiscal year 1981, and $65,000,000 for fiscal 
year 1982.]
  (g) Authorization of Appropriations.--There is authorized to 
be appropriated to carry out this section $90,000,000 per 
fiscal year for each of fiscal years 1996 through 2000. Such 
sums shall remain available until expended.
  (h)(1) When a participating State proceeds to construct a 
segment of a development highway without the aid of Federal 
funds, in accordance with all procedures and requirements 
applicable to the construction of segments of Appalachian 
development highways with such funds, except insofar as such 
procedures and requirements limit a State to the construction 
of projects for which Federal funds have previously been 
appropriated, the Secretary, upon application by the State and 
with the approval of the Commission, is authorized to pay to 
the State the Federal share not to exceed [70 per centum] 80 
percent of the costs of the construction of such segment, from 
any sums appropriated and allocated to such State to carry out 
this section.
          * * * * * * *

                 TITLE II--SPECIAL APPALACHIAN PROGRAMS

                          Part A--New Programs

          * * * * * * *
  Sec. 202. (a) * * *
          * * * * * * *
  (c) Grants under this section for operation (including 
initial operating funds and operating deficits comprising among 
other items the costs of attracting, training, and retaining 
qualified personnel) of a demonstration health project, whether 
or not constructed with funds authorized by this section, may 
be made for up to [100 per centum of the costs thereof for the 
two-year period beginning, for each component facility or 
service assisted under any such operating grant, on the first 
day that such facility or service is in operation as a part of 
the project. For the next three years of operations such grants 
shall not exceed 75 per centum of such costs.] 50 percent of 
the costs thereof (or 80 percent of such costs in the case of a 
project to be carried out in a county for which a distressed 
county designation is in effect under section 226). The Federal 
contribution may be provided entirely from funds appropriated 
to carry out this section or in combination with funds provided 
under other Federal grant-in-aid programs for the operation of 
health related facilities and the provision of health and child 
development services, including title IV, parts A and B, and 
title XX of the Social Security Act. Notwithstanding any 
provision of the Social Security Act requiring assistance or 
services on a statewide basis, if a State provides assistance 
or services under such a program in any area of the region 
approved by the Commission, such State shall be considered as 
meeting such requirement. Notwithstanding any provision of law 
limiting the Federal share in such other programs, funds 
appropriated to carry out this section may be used to increase 
Federal grants for operating components of a demonstration 
health project to the maximum percentage cost thereof 
authorized by this subsection. No grant for operation of a 
demonstration health project shall be made unless the facility 
is publicly owned, or owned by a public or private nonprofit 
organization, and is not operated for profit. No grant for 
operation of a demonstration health project shall be made after 
five years following the commencement of the initial grant for 
operation of the project, that child development demonstrations 
assisted under this section during fiscal year 1979 may, upon 
State request, be approved under section 303 of this Act for 
continued support beyond that period if the Commission finds 
that no Federal, State, or local funds are available to 
continue such demonstrations. No such grants shall be made 
unless the Secretary of Health, Education, and Welfare is 
satisfied that the operation of the project will be conducted 
under efficient management practices designed to obviate 
operating deficits. Notwithstanding section 104 of the Public 
Works and Economic Development Act of 1965 (79 Stat. 554), a 
health-related facility constructed under title I of that Act 
may be a component of a demonstration health project eligible 
for operating grant assistance under this section.
          * * * * * * *
  (f) Maximum Commission Contribution After September 30, 
1995.--After September 30, 1995, not more than 50 percent of 
any project cost eligible for financial assistance under this 
section may be provided from funds appropriated to carry out 
this Act; except that such maximum Commission contribution may 
be increased to 80 percent, or to the percentage of the maximum 
Federal contribution authorized by this section, whichever is 
less, for a project to be carried out in a county for which a 
distressed county designation is in effect under section 226.

         [land stabilization, conservation, and erosion control

  [Sec. 203. (a) In order to provide for the control and 
prevention of erosion and sediment damages in the Appalachian 
region and to promote the conservation and development of the 
soil and water resources of the region the Secretary of 
Agriculture is authorized to enter into agreements of not more 
than ten years with landowners, operators, and occupiers, 
individually or collectively, in the Appalachian region 
determined by him to have control for the period of the 
agreement of the lands described therein providing for land 
stabilization, erosion and sediment control, and reclamation 
through changes in land use, and conservation treatment 
including the establishment of practices and measures for the 
conservation and development of soil, water, woodland, 
wildlife, and recreation resources.
  [(b) The landowner, operator, or occupier shall furnish to 
the Secretary of Agriculture a conservation and development 
plan setting forth the appropriate and safe land uses and 
conservation treatment mutually agreed by the Secretary and the 
landowner, operator, or occupier to be needed on the lands for 
which the plan was prepared.
  [(c) Such plan shall be incorporated in an agreement under 
which the landowner, operator, or occupier shall agree with the 
Secretary of Agriculture to carry out the land uses and 
conservation treatment provided for in such plan on the lands 
described in the agreement in accordance with the terms and 
conditions thereof.
  [(d) In return for such agreement by the landowner, operator, 
or occupier the Secretary of Agriculture shall be authorized to 
furnish financial and other assistance to such landowner, 
operator, or occupier in such amounts and subject to such 
conditions as the Secretary determines are appropriate and in 
the public interest for the carrying out of the land uses and 
conservation treatment set forth in the agreement: Provided, 
That grants hereunder shall not exceed 80 per centum of the 
costs of carrying out such land uses and conservation treatment 
on fifty acres of land occupied by such owner, operator, or 
occupier.
  [(e) The Secretary of Agriculture may terminate any agreement 
with a landowner, operator, or occupier by mutual agreement if 
the Secretary determines that such termination would be in the 
public interest, and may agree to such modification of 
agreements previously entered into hereunder as he deems 
desirable to carry out the purposes of this section or to 
facilitate the practical administration of the program 
authorized herein.
  [(f) Notwithstanding any other provision of law, the 
Secretary of Agriculture, to the extent he deems it desirable 
to carry out the purposes of this section, may provide in any 
agreement hereunder for first, preservation for a period not to 
exceed the period covered by the agreement and an equal period 
thereafter of the cropland, crop acreage, and allotment history 
applicable to land covered by the agreement for the purpose of 
any Federal program under which such history is used as a basis 
for an allotment or other limitation on the production of such 
crop; or second, surrender of any such history and allotments.
  [(g) The Secretary of Agriculture shall be authorized to 
issue such rules and regulations as he determines are necessary 
to carry out the provisions of this section.
  [(h) In carrying out the provisions of this section, the 
Secretary of Agriculture shall utilize the services of the Soil 
Conservation Service, and the State and local committees 
provided for in section 8(b) of the Soil Conservation and 
Domestic Allotment Act (16 U.S.C. 590(b)), and is authorized to 
utilize the facilities, services, and authorities of the 
Commodity Credit Corporation. The Corporation shall not make 
any expenditures to carry out the provisions of this subsection 
unless funds specifically appropriated for such purpose have 
been transferred to it.
  [(i) Not to exceed $19,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out this section.

                   [timber development organizations

  [Sec. 204. (a) In order that the region shall more fully 
benefit from the timber stands that are one of its prime 
assets, the Secretary of Agriculture is authorized to--
          [(1) provide technical assistance in the organization 
        and operation, under State law, of private timber 
        development organizations having as their objective the 
        carrying out of timber development programs to improve 
        timber productivity and quality, and increase returns 
        to landowners through establishment of private 
        nonprofit corporations, which on a self-supporting 
        basis may provide (A) continuity of management, good 
        cutting practices, and marketing services, (B) physical 
        consolidation of small holdings or administrative 
        consolidation for efficient management under long-term 
        agreement, (C) management of forest lands, donated to 
        the timber development organizations for demonstrating 
        good forest management, on a profitable and taxpaying 
        basis, and (D) establishment of a permanent fund for 
        perpetuation of the work of the corporations to be 
        composed of donations, real or personal, for 
        educational purposes.
          [(2) provide not more than one-half of the initial 
        capital requirements of such timber development 
        organizations through loans under the applicable 
        provisions of the Consolidated Farmers Home 
        Administration Act of 1961 (7 U.S.C. 1926 et seq.). 
        Such loans shall not be used for the construction or 
        acquisition of facilities for manufacturing, 
        processing, or marketing forest products, or for 
        physical consolidation of small timber holdings 
        authorized by (1)(B) above except for the establishment 
        of demonstration units.
  [(b) The Secretary of Agriculture is authorized to provide 
technical assistance, make grants, enter into contracts, or 
otherwise provide funds, first to colleges, universities and 
other institutions of higher education (with priority to land 
grant schools), and thereafter to forest products research 
institutions in the region and other appropriate public and 
private organizations, which schools, institutions and 
organizations have the demonstrated capability to perform such 
research, for Appalachian hardwood products research, including 
investigations, studies, and demonstrations, which will further 
the purposes of this Act. Funds shall be provided only for 
programs and projects which will contribute significantly to 
the development of first, Appalachian hardwood technology, 
second, new or improved uses of Appalachian hardwood resources, 
third, new or improved processes or methods for producing 
hardwood products, or fourth, new or improved markets for such 
products. Funds under this section shall be provided solely out 
of sums specifically appropriated for the purpose of carrying 
out this Act, and shall not be taken into account in the 
allocation or distribution of funds pursuant to any other 
provision of law.
  [(c) Not to exceed $2,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out the purposes of 
subsection (b) of this section.

                        [mining area restoration

  [Sec. 205. (a) In order to further the economic development 
of the region by rehabilitating areas presently damaged by 
deleterious mining practices, the Secretary of the Interior is 
authorized to--
          [(1) makes financial contributions to States in the 
        region to seal and fill voids in abandoned coal mines 
        and abandoned oil and gas wells, and to reclaim and 
        rehabilitate lands affected by the strip and surface 
        mining and processing of coal and other minerals, 
        including lands affected by waste piles, in accordance 
        with provisions of the Act of July 15, 1955 (30 U.S.C. 
        571 et seq.), to the extent applicable, without regard 
        to section 2(b) thereof (30 U.S.C. 572(b)) or to any 
        provisions therein limiting assistance to anthracite 
        coal formation, or the Commonwealth of Pennsylvania; to 
        control and abate mine drainage pollution; and for 
        planning or engineering for any such activities. Grants 
        under this paragraph shall be made wholly out of funds 
        specifically appropriated for the purposes of carrying 
        out this Act.
          [(2) plan and execute projects for planning, 
        engineering, or extinguishing underground and outcrop 
        mine fires in the region or to make grants to the 
        States for carrying out such projects, in accordance 
        with the applicable provisions of the Act of August 31, 
        1954 (30 U.S.C. 551 et seq.), without regard to any 
        provisions therein relating to annual appropriation 
        authorization ceilings. Grants under this paragraph 
        shall be made solely out of funds specifically 
        appropriated for the purpose of carrying out this Act.
  [(b) Notwithstanding any other provision of law, the Federal 
share of mining area restoration project costs carried out 
under subsection (a) of this section and conducted on lands 
other than federally owned lands shall not exceed 75 per centum 
of the total cost thereof. For the purposes of this section, 
such project costs may include the reasonable value (including 
donations), of planning, engineering, real property acquisition 
(limited to the reasonable value of the real property in its 
unreclaimed state and costs incidental to its acquisition, as 
determined by the Commission), and such other materials 
(including, but not limited to, sand, clay, stone, culm, rock, 
spoil bank and noncombustible materials) and services as may be 
required for such project.
  [(c) Whenever a State, local government, or other nonprofit 
applicant agrees to indemnify the Federal Government, or its 
officers, agents, or employees, for all claims of loss or 
damage resulting from the use and occupation of lands for a 
project assisted under this section, the Secretary may waive 
all requirements for the submission of releases, consents, 
waivers, or similar instruments respecting such lands, but the 
Secretary may require security as he deems appropriate for any 
such indemnification agreement.
  [(d) No moneys authorized by this Act shall be expended for 
the purpose of reclaiming, improving, grading, seeding, or 
reforestation of strip-mined areas, except on lands owned by 
Federal, State, or local government bodies or by private 
nonprofit entities organized under State law to be used for 
public recreation, conservation, community facilities, or 
public housing.

                         [water resource survey

  [Sec. 206 (a) The Secretary of the Army is hereby authorized 
and directed to prepare a comprehensive plan for the 
development and efficient utilization of the water and related 
resources of the Appalachian region, giving special attention 
to the need for an increase in the production of economic goods 
and services within the region as a means of expanding economic 
opportunities and thus enhancing the welfare of its people, 
which plan shall constitute an integral and harmonious 
component of the regional economic development program 
authorized by this Act.
  [(b) This plan may recommend measures for the control of 
floods, the regulation of the rivers to enhance their value as 
sources of water supply for industrial and municipal 
development, the generation of hydroelectric power, the 
prevention of water pollution by drainage from mines, the 
development and enhancement of the recreational potentials of 
the region, the improvement of the rivers for navigation where 
this would further industrial development at less cost than 
would the improvement of other modes of transportation, the 
conservation and efficient utilization of the land resource, 
and such other measures as may be found necessary to achieve 
the objectives of this section.
  [(c) To insure that the plan prepared by the Secretary of the 
Army shall constitute a harmonious component of the regional 
program, he shall consult with the Commission and the 
following: the Secretary of Agriculture, the Secretary of 
Commerce, the Secretary of Health, Education, and Welfare, the 
Secretary of the Interior, Secretary of Transportation, the 
Tennessee Valley Authority, and the Federal Power Commission.
  [(d) The plan prepared pursuant to this section shall be 
submitted to the Commission. The Commission shall submit the 
plan to the President with a statement of its views, and the 
President shall submit the plan to the Congress with his 
recommendations not later than December 31, 1968.
  [(e) The Federal agencies referred to in subsection (c) of 
this section are hereby authorized to assist the Secretary of 
the Army in the preparation of the plan authorized by this 
section, and the Secretary of the Army is authorized to enter 
into and perform such contracts, leases, cooperative 
agreements, or other transactions as may be necessary to the 
preparation of this plan and on such terms as he may deem 
appropriate, with any department, agency, or instrumentality of 
the United States or with any State, or any political 
subdivision, agency, or instrumentality thereof, or with any 
person, firm, association, or corporation.
  [(f) The plan to be prepared by the Secretary of the Army 
pursuant to this section shall also be coordinated with all 
comprehensive river basin plans heretofore or hereafter 
developed by United States study commissions, interagency 
committees, or similar planning bodies, for those river systems 
draining the Appalachian region.
  [(g) Not to exceed $2,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out this section.]

assistance for planning and other preliminary expenses of proposed low- 
                  and moderate-income housing projects

  Sec. 207. (a) * * *
  (b) No loan under subsection (a) of this section shall exceed 
[80 per centum] 50 percent (or 80 percent in the case of a 
project to be carried out in a county for which a distressed 
county designation is in effect under section 226) of the cost 
of planning and obtaining financing for a project, including, 
but not limited to, preliminary surveys and analyses of market 
needs, preliminary site engineering and architectural fees, 
site options, applications and mortgage commitment fees, legal 
fees, and construction loan fees and discounts. Such loans 
shall be made without interest, except that any loan made to an 
organization established for profit shall bear interest at the 
prevailing market rate authorized for an insured or guaranteed 
loan for such project. The Secretary shall require payments of 
loans made under this section, under such terms and conditions 
as he may require, upon completion of the project or sooner, 
and except in the case of a loan to an organization established 
for profit, may cancel any part or all of such a loan, if he 
determines that a permanent loan to finance such project cannot 
be obtained in an amount adequate for repayment of such loan 
under this section.
  (c)(1) Except as provided in paragraph (2) of this 
subsection, no grant under this section shall exceed [80 per 
centum] 50 percent (or 80 percent in the case of a project to 
be carried out in a county for which a distressed county 
designation is in effect under section 226) of those expenses, 
incident to planning and obtaining financing for a project, 
which the Secretary considers not to be recoverable from the 
proceeds of any permanent loan made to finance such project, 
and no such grant shall, be made to an organization established 
for profit.
          * * * * * * *

                [appalachian airport safety improvements

  [Sec. 208. (a) In order to provide a system of airports in 
the Appalachian region which can accommodate a greater number 
of passengers in safety and thereby increase commerce and 
communication in areas with developmental potential, the 
Secretary of Transportation (hereafter in this section referred 
to as the ``Secretary'') is authorized to make grants to 
existing airports for the purpose of enhancing the safety of 
aviation and airport operations.
  [(b) Such airport safety improvement projects may include (A) 
approach clearance, the removal, lowering, relocation, and 
marking and lighting of airport hazards, navigation aids, site 
preparation for navigation aids, and the acquisition of 
adequate safety equipment (including firefighting and rescue 
equipment), and (B) any acquisition of land or of any interest 
therein, or of any easement through or other interest in 
airspace which is necessary for such projects or to remove or 
mitigate or prevent or limit the establishment of, airport 
hazards.
  [(c) Grants under this section shall be made solely from 
funds specifically made available to the President for the 
purpose of carrying out this Act in accordance with the 
provisions of this Act, and shall not be taken into account in 
the computation of the allotments among the States made 
pursuant to any other provisions of law.
  [(d) Except as context otherwise indicates, words and phrases 
used in this section shall have the same meaning as in the 
Airport and Airways Development Act of 1970 and the Federal 
Aviation Act of 1958, as amended.
  [(e) Federal assistance to any project under this section 
shall not exceed 90 per centum of the costs of the project, 
except for assistance for navigation aids which may be 100 per 
centum.
  [(f) The Secretary is authorized to incur obligations to make 
grants for airport safety improvement projects, in a total 
amount not to exceed $40,000,000 during the period ending June 
30, 1975. There are authorized to be appropriated to the 
President such sums as may be required for liquidation of the 
obligations incurred under this section.]

    Part B--Supplementations and Modifications of Existing Programs

vocational education facilities and vocational and technical education 
                         demonstration projects

  Sec. 211. (a) * * *
  (b)(1) * * *
          * * * * * * *
  (3) Grants under this section for operation of components of 
education demonstration projects, whether or not constructed by 
funds authorized by this Act, may be made for up to [100 per 
centum of the costs thereof for the two-year period beginning 
on the first day that such component is in operation as a part 
of the project. For the next three years of operation, such 
grants shall not exceed 75 per centum of such costs.] 50 
percent of the costs thereof (or 80 percent of such costs in 
the case of a project to be carried out in a county for which a 
distressed county designation is in effect under section 226). 
No grants for operation of education demonstration projects 
shall be made after five years following the commencement of 
the initial grant for operation of the project. Notwithstanding 
section 104 of the Public Works and Economic Development Act of 
1965 (42 U.S.C. 3134), an education-related facility 
constructed under title I of that Act may be a component of an 
education demonstration project eligible for operating grant 
assistance under this section.
          * * * * * * *
  (c) Maximum Commission Contribution After September 30, 
1995.--After September 30, 1995, not more than 50 percent of 
any project cost eligible for financial assistance under this 
section may be provided from funds appropriated to carry out 
this Act; except that such maximum Commission contribution may 
be increased to 80 percent, or to the percentage of the maximum 
Federal contribution authorized by this section, whichever is 
less, for a project to be carried out in a county for which a 
distressed county designation is in effect under section 226.

                        [sewage treatment works

  [Sec. 212. (a) In order to provide facilities to assist in 
the prevention of pollution of the region's streams and to 
protect the health and welfare of its citizens, the Secretary 
of Health, Education, and Welfare is authorized to make grants 
for the construction of sewage treatment works in accordance 
with the provisions of the Federal Water Pollution Control Act 
(33 U.S.C. 466 et seq.), without regard to any provisions 
therein relating to appropriation authorization ceilings or to 
allotments among the States. Grants under this section shall be 
made solely out of funds specifically appropriated for the 
purpose of carrying out this Act, and shall not be taken into 
account in the computation of the allotments among the States 
pursuant to any other provision of law.
  [(b) Not to exceed $6,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out this section.

                   [amendments to housing act of 1954

  [Sec. 213. (a) Section 701(a) of the Housing Act of 1954 (40 
U.S.C. 461(a)) is amended by striking out ``and'' at the end of 
clause (8) and all of clause (9) and inserting in lieu thereof 
the following:
          [``(9) the Appalachian Regional Commission, for 
        comprehensive planning for the Appalachian region as 
        defined by section 403 of the Appalachian Regional 
        Development Act of 1965; and
          [``(10) local development districts, certified under 
        section 301 of the Appalachian Regional Development Act 
        of 1965, for comprehensive planning for their entire 
        areas, or for metropolitan planning, urban planning, 
        county planning, or small municipality planning within 
        such areas in the Appalachian region, and for planning 
        for Appalachian regional programs.''
  [(b) The proviso of the first sentence of section 701(b) of 
the Housing Act of 1954 is amended by inserting after 
``States'' the words ``and local development districts.'']

              supplements to federal grant-in-aid programs

  Sec. 214. (a) In order to enable the people, States, and 
local communities of the region, including local development 
districts, to take maximum advantage of Federal grant-in-aid 
programs (as hereinafter defined) for which they are eligible 
but for which, because of their economic situation, they cannot 
supply the required matching share, or for which there are 
insufficient funds available under the Federal grant-in-aid Act 
authorizing such programs to meet pressing needs of the region, 
[the President is authorized to provide funds to the Federal 
Cochairman to be used] the Federal Cochairman may use amounts 
made available to carry out this section for all or any portion 
of the basic Federal contribution to projects or activities 
(hereinafter referred to as projects) under such Federal grant-
in-aid programs authorized by Federal grant-in-aid Acts, and 
for the purpose of increasing the Federal contribution to 
projects under such programs, as hereafter defined, above the 
fixed maximum portion of the cost of such projects otherwise 
authorized by the applicable law. In the case of any program or 
project for which all or any portion of the basic Federal 
contribution to the project under a Federal grant-in-aid 
program is proposed to be made under this subsection, no such 
Federal contribution shall be made until the responsible 
Federal official administering the Federal grant-in-aid Act 
authorizing such contribution certifies that such program or 
project meets the applicable requirements of such Federal 
grant-in-aid Act and could be approved for Federal contribution 
under such Act if funds were available under such Act for such 
program or project. Funds may be provided for programs and 
projects in a State under this subsection only if the 
Commission determines that the level of Federal and State 
financial assistance under Acts other than this Act, for the 
same type of programs or projects in that portion of the State 
within the region, will not be diminished in order to 
substitute funds authorized by this subsection. Funds provided 
pursuant to this Act shall be available without regard to any 
limitations on areas eligible for assistance or authorizations 
for appropriation in any other Act. Any findings, report, 
certification, or documentation required to be submitted to the 
head of the department, agency, or instrumentality of the 
Federal Government responsible for the administration of any 
Federal grant-in-aid program shall be accepted by the Federal 
Cochairman with respect to a supplemental grant for any project 
under such program.
  (b)(1) The Federal portion of such costs shall not be 
increased in excess of the percentage established by the 
Commission, and shall in no event exceed 80 per centum thereof.
  (2) After September 30, 1995, not more than 50 percent of any 
project cost eligible for financial assistance under this 
section may be provided from funds appropriated to carry out 
this Act; except that such maximum Commission contribution may 
be increased to 80 percent for a project to be carried out in a 
county for which a distressed county designation is in effect 
under section 226.
  (c) The term ``Federal grant-in-aid programs'' as used in 
this section means those Federal grant-in-aid programs 
authorized [on or before December 31, 1980,] by this Act and 
Acts other than this Act for the acquisition or development of 
land, the construction or equipment of facilities, or other 
community or economic development or economic adjustment 
activities, including but not limited to grant-in-aid progams 
authorized by the following Acts: Federal Water Pollution 
Control Act; Watershed Protection and Flood Prevention Act; 
titles VI and XVI of the Public Helath Services Act; Vocational 
Education Act of 1963; Library Services and Construction Act; 
Federal Airport Act; Airport and Airway Development Act of 
1970; part IV of title III of the Communications Act of 1934; 
title VI (part A) and VII of the Higher Education Act of 1965; 
Land and Water Conservation Fund Act of 1965; National Defense 
Education Act of 1958; Consolidated Farm and Rural Development 
Act; titles I and IX of the Public Works and Economic 
Development Act of 1965; the housing repair program for 
homeowners authorized by section 1319 of title 42, United 
States Code; grants under the Indian Health Service Act (42 
Stat. 208); and title I of the Housing and Community 
Development Act of 1974. The term shall not include (A) the 
program for the construction of the development highway system 
authorized by section 201 of this Act or any program relating 
to highway or road construction authorized by title 23, United 
States Code or (B) any other program for which loans or other 
Federal financial assistance, except a grant-in-aid program, is 
authorized by this or any other Act. For the purpose of this 
section, any sewage treatment works constructed pursuant to 
section 8(c) of the Federal Water Pollution Control Act without 
Federal grant-in-aid assistance under such section shall be 
regarded as if constructed with such assistance.
          * * * * * * *

                       Part C--General Provisions

          * * * * * * *

                      program development criteria

  Sec. 224. (a) In considering programs and projects to be 
given assistance under this Act, and in establishing a priority 
ranking of the requests for assistance presented to the 
Commission, the Commission shall follow procedures that will 
insure consideration of the following factors:
          (1) the relationship of the project or class of 
        projects to overall regional development including its 
        location in an area determined by the State to have a 
        significant potential for growth or in a severely and 
        persistently distressed and underdeveloped county or 
        area;
          * * * * * * *
          (5) the prospects that the project for which 
        assistance is sought will improve, on a continuing 
        rather that a temporary basis, the opportunities for 
        employment, the average level of income, or the 
        economic and social development of the area served by 
        the project[.]; and
          (6) the extent to which the project design provides 
        for detailed outcome measurements by which grant 
        expenditures may be justified.
  [(b) No financial assistance shall be authorized under this 
Act to be used (1) to assist establishments relocating from one 
area to another; (2) to finance the cost of industrial plants, 
commercial facilities, machinery, working capital, or other 
industrial facilities or to enable plant subcontractors to 
undertake work theretofore performed in another area by other 
subcontractors or contractors; (3) to finance the cost of 
facilities for the generation, transmission, or distribution of 
electric energy; or (4) to finance the cost of facilities for 
the production, transmission, or distribution of gas (natural, 
manufactured, or mixed).]
  (b) Limitation.--No financial assistance made available under 
this Act may be used to assist establishments relocating from 
one area to another.
          * * * * * * *

SEC. 226. DISTRESSED AND ECONOMICALLY COMPETITIVE COUNTIES.

  (a) Designations.--Not later than 90 days after the effective 
date of the Economic Development Partnership Act of 1995, and 
annually thereafter, the Commission, in accordance with such 
criteria as the Commission may establish, shall--
          (1) designate as ``distressed counties'' those 
        counties in the region that are the most severely and 
        persistently distressed and underdeveloped; and
          (2) designate as ``economically competitive 
        counties'' those counties in the region which have 
        attained substantial economic parity with the rest of 
        the Nation.
  (b) Period of Effectiveness.--In making annual designations 
under subsection (a), the Commission may discontinue an 
existing designation at the discretion of the Commission; 
except that any designation of a distressed county shall remain 
in effect for the 3-year period beginning on the date of the 
designation.
  (c) Funding Prohibition for Projects Located in Economically 
Competitive Counties.--
          (1) In general.--Except as provided by paragraph (2), 
        no funds may be provided under this Act for a project 
        located in a county for which an economically 
        competitive county designation is in effect under this 
        section.
          (2) Exceptions.--The prohibition established by 
        paragraph (1) shall not apply to--
                  (A) projects on the Appalachian development 
                highway system authorized by section 201;
                  (B) local development district administrative 
                projects authorized by section 302(a)(1); or
                  (C) discretionary grants authorized by 
                section 302(a).

                        TITLE III--ADMINSTRATION

          * * * * * * *

 grants for administration expenses of local development districts and 
                for research and demonstration projects

  Sec. 302. (a) [The President] The Commission is authorized--
          (1) to make grants [to the Commission] for 
        administrative expenses, including the development of 
        areawide plans or action programs and technical 
        assistance activities, of local development districts, 
        but (A) the amount of any such grant shall not exceed 
        [75 per centum] 50 percent of such expenses, (B) no 
        grants for administrative expenses shall be made for a 
        State agency certified as a local development district 
        for a period in excess of three years beginning on the 
        date the initial grant is made for such development 
        district, and (C) the local development district 
        contributions for administrative expenses may be in 
        cash or in kind, fairly evaluated, including but not 
        limited to space, equipment, and services;
          (2) to make grants [to the Commission] for assistance 
        to States for a period not in excess of two years to 
        strengthen the State development planning process for 
        the region and the coordination of State planning under 
        this Act, the Public Works and Economic Development Act 
        of 1965, as amended, and other Federal and State 
        programs; and
          (3) to make grants [to the Commission] for 
        investigation, research, studies, evaluations, and 
        assessments of needs, potentials, or attainment of the 
        people of the region, technical assistance, training 
        programs, demonstrations, and the construction of 
        necessary facilities incident to such activities, which 
        will further the purposes of this Act. Grant funds may 
        be provided entirely from appropriations to carry out 
        this section or in combination with funds available 
        under other Federal or Federal grant-in-aid programs or 
        from any other source. Notwithstanding any provision of 
        law limiting the Federal share in any such other 
        program, funds appropriated to carry out this section 
        may be used to increase such Federal share, as the 
        Commission determines appropriate. After September 30, 
        1995, not more than 50 percent of the cost of any 
        activity eligible for financial assistance under this 
        section may be provided from funds appropriated to 
        carry out this Act (or 80 percent of such costs in the 
        case of a project to be carried out in a county for 
        which a distressed county designation is in effect 
        under section 226); except that discretionary grants by 
        the Commission to implement significant regional 
        initiatives, to take advantage of special development 
        opportunities, or to respond to emergency economic 
        distress in the region may be made without regard to 
        such percentage limitations. The aggregate amount of 
        discretionary grants referred to in the preceding 
        sentence in any fiscal year shall not exceed 10 percent 
        of the amounts appropriated under section 401 for such 
        fiscal year.
          * * * * * * *
  (b)(1)  * * *
          * * * * * * *
  [(3) The Commission shall conduct a study and report on the 
status of Appalachian migrants in the destinations to which 
they have migrated, current migration patterns and 
implications, and the impact which the Commission program has 
had, and the potential for such impact, on out-migration and 
the welfare of Appalachian migrants. The Commission is 
authorized to conduct pilot projects and demonstrations within 
the region in connection with such study.
  [(4) The Commission shall conduct a study of physical hazards 
which are constraints on land use in the Appalachian region 
(with emphasis on mudslides, landslides, sink holes, and 
subsidence) and the risks associated with such hazards. To the 
extent practicable, such study shall identify high-risk hazard 
areas throughout the Appalachian region. The Commission shall 
submit its report on such study, together with recommendations 
for means to remove or avoid such constraints on land use, to 
the Congress not later than twenty-four months after the 
enactment of this paragraph.]
          * * * * * * *
  [(d) Not to exceed $11,000,000 of the funds authorized in 
section 401 of this Act for the two-fiscal-year period ending 
June 30, 1969, shall be available to carry out this section. 
Not to exceed $3,000,000 of such authorization shall be 
available for the purpose of subsection (b).
  [(e) No part of any appropriated funds may be expended 
pursuant to authorization given by this Act involving any 
scientific or technological research for development activity 
unless such expenditure is conditioned upon provisions 
effective to insure that all information, copywrights, uses, 
processes, patents, and other developments resulting from that 
activity will be made freely available to the general public. 
Nothing contained in this subsection shall deprive the owner of 
any background patent relating to any such activity, without 
his consent, of any right which that owner may have under that 
patent. Whenever any information, copyright, use, process, 
patents, and other development resulting from any such research 
or development activity conducted in whole or in part with 
appropriated funds expended under authorization of this Act is 
withheld or disposed of by any person, organization, or agency 
in contravention of the provisions of this subsection, the 
Attorney General shall institute, upon his own motion or upon 
request made by any person having knowledge of pertinent facts, 
an action for the enforcement of the provisions of this 
subsection in the district court of the United States for any 
judicial district in which any defendant resides, is found, or 
has a place of business. Such court shall have jurisdiction to 
hear and determine such action, and to enter therein such 
orders and decrees as it shall determine to be required to 
carry into effect fully the provisions of this subsection. 
Process of the district court for any judicial district in any 
action instituted under this subsection may be served in any 
other judicial district of the United States by the United 
States marshal thereof. Whenever it appears to the court in 
which any such action is pending that other parties should be 
brought before the court in such action, the court may cause 
such other parties to be summoned from any judicial district of 
the United States.]
          * * * * * * *

         TITLE IV--APPROPRIATIONS AND MISCELLANEOUS PROVISIONS

                    [authorization of appropriations

  [Sec. 401. In addition to the appropriations authorized in 
section 105 for administrative expenses, in section 201 for the 
Appalachian Development Highway System and Local Access Roads, 
and in section 208 for Appalachian Airport Safety Improvements, 
there is hereby authorized, to be appropriated to the 
President, to be available until expended, to carry out this 
Act, $268,500,000 for the two-fiscal year period ending June 
30, 1971; $282,000,000 for the two-fiscal year period ending 
June 30, 1973; and $294,000,000 for the two-fiscal year period 
ending June 30, 1975. In addition to the appropriations 
authorized in section 105 for administrative expenses, and in 
section 201(g) for the Appalachian development highway system 
and local access roads, there is authorized to be appropriated 
to the President, to be available until expended, to carry out 
this Act, $340,000,000 for the period beginning July 1, 1975, 
and ending September 30, 1977, and $300,000,000 for the two-
fiscal year period ending September 30, 1979, and $300,000,000 
for the two-fiscal-year period ending September 30, 1981, and 
$50,000,000 for the fiscal year period ending September 30, 
1982. No part of the sums authorized in this section for the 
fiscal year ending September 30, 1982, shall be obligated for 
any project unless such project was undertaken with funds 
obligated in a previous fiscal year or is a capital project 
which was originally approved for funding in fiscal year 1981 
and can be started and completed with funds authorized for 
fiscal year 1982. No part of the sums authorized in this 
section for the fiscal year ending September 30, 1982, shall be 
obligated for any project unless such project was undertaken 
with funds obligated in a previous fiscal year or is a capital 
project which was originally approved for funding in fiscal 
year 1981 and can be started and completed with funds 
authorized for fiscal year 1982.]

SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

  In addition to the appropriations authorized by section 105 
for administrative expenses and by section 201(g) for the 
Appalachian development highway system and local access roads, 
there is authorized to be appropriated to the Commission to 
carry out this Act $88,355,000 per fiscal year for each of 
fiscal years 1996 through 2000. Such sums shall remain 
available until expended.
          * * * * * * *

                              termination

  Sec. 405. This Act, other than section 201, shall cease to be 
in effect on October 1, [1982] 2000.

                       Summary of Committee Votes

    The Committee on Transportation and Infrastructure held a 
full committee markup on September 28, 1995. The bill was 
amended and passed by voice vote.
    Subsequently, on October 11, 1995, the Transportation and 
Infrastructure Committee met and approved revised 
reconciliation recommendations by a recorded vote of 38-5. The 
committee's action on October 11 superceded and replaced in 
full previous reconciliation recommendations transmitted to the 
Budget Committee.
    The vote on passage was as follows:

------------------------------------------------------------------------
                  Member                      Aye       No      Present 
------------------------------------------------------------------------
Mr. Bachus...............................        X   ........  .........
Mr. Baker................................        X   ........  .........
Mr. Barcia...............................  ........  ........  .........
Mr. Bateman..............................  ........  ........  .........
Mr. Blute................................        X   ........  .........
Mr. Boehlert.............................        X   ........  .........
Mr. Borski...............................  ........  ........  .........
Mr. Brewster.............................        X   ........  .........
Ms. Brown................................  ........  ........  .........
Mr. Clement..............................        X   ........  .........
Mr. Clinger..............................        X   ........  .........
Mr. Clyburn..............................        X   ........  .........
Mr. Coble................................  ........  ........  .........
Ms. Collins..............................  ........  ........  .........
Mr. Costello.............................        X   ........  .........
Mr. Cramer...............................  ........  ........  .........
Ms. Danner...............................  ........        X   .........
Mr. DeFazio..............................  ........  ........  .........
Mr. Duncan...............................        X   ........  .........
Mr. Ehlers...............................        X   ........  .........
Mr. Emerson..............................        X   ........  .........
Mr. Ewing................................  ........  ........  .........
Mr. Filner...............................  ........        X   .........
Mrs. Fowler..............................        X   ........  .........
Mr. Franks...............................        X   ........  .........
Mr. Gilchrest............................        X   ........  .........
Mr. Hayes................................  ........        X   .........
Mr. Horn.................................  ........  ........  .........
Mr. Hutchinson...........................        X   ........  .........
Ms. Johnson..............................        X   ........  .........
Mrs. Kelly...............................        X   ........  .........
Mr. Kim..................................        X   ........  .........
Mr. LaHood...............................        X   ........  .........
Mr. Latham...............................        X   ........  .........
Mr. LaTourette...........................        X   ........  .........
Mr. Lipinski.............................        X   ........  .........
Ms. McCarthy.............................  ........  ........  .........
Mr. Martini..............................        X   ........  .........
Mr. Mascara..............................        X   ........  .........
Mr. Menendez.............................  ........        X   .........
Mr. Mica.................................  ........  ........  .........
Ms. Molinari.............................        X   ........  .........
Mr. Nadler...............................  ........        X   .........
Ms. Norton...............................  ........  ........  .........
Mr. Oberstar.............................        X   ........  .........
Mr. Parker...............................        X   ........  .........
Mr. Petri................................        X   ........  .........
Mr. Poshard..............................        X   ........  .........
Mr. Quinn................................        X   ........  .........
Mr. Rahall...............................        X   ........  .........
Mrs. Seastrand...........................        X   ........  .........
Mr. Tate.................................        X   ........  .........
Mr. Traficant............................  ........  ........  .........
Mr. Tucker...............................  ........  ........  .........
Mr. Wamp.................................        X   ........  .........
Mr. Weller...............................        X   ........  .........
Mr. Wise.................................        X   ........  .........
Mr. Young................................  ........  ........  .........
Mr. Zeliff...............................  ........  ........  .........
Mr. Shuster, Chairman....................        X   ........  .........
                                          ------------------------------
      Total..............................       38         5   .........
------------------------------------------------------------------------

                  Congressional Budget Office Estimate

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 11, 1995.
Hon. Bud Shuster,
Chairman, Committee on Transportation and Infrastructure, House of 
        Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for the reconciliation 
recommendations of the House Committee on Transportation and 
Infrastructure.
    The estimate shows the budgetary effects of the committee's 
proposals over the 1966-2002 period. CBO understands that the 
Committee on the Budget will be responsible for interpreting 
how these proposals compare with the reconciliation 
instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                             James L. Blum,
                                   (For June E. O'Neill, Director.)
    Enclosure.
               congressional budget office cost estimate
    1. Bill number: Not yet assigned.
    2. Bill title: Reconciliation recommendations of the House 
Committee on Transportation and Infrastructure.
    3. Bill status: As ordered reported by the House Committee 
on Transportation and Infrastructure on October 11, 1995.
    4. Bill purpose: The provisions of this title would reduce 
the deficit over the 1996-2002 period by extending certain 
Federal fees, authorizing new fee collections, and providing 
for the sale of certain Federal assets. Other provisions of 
this title would deregulate the ocean shipping industry, 
provide for the disposition of surplus Federal lands in 
Illinois, and authorize appropriations for economic development 
programs. Finally, two provisions of subtitle A would prevent 
the Army Corps of Engineers from implementing certain 
provisions of other reconciliation titles. This subtitle would 
prohibit the sale of any project or project feature operated by 
the corps and would prohibit the agency from modifying any 
aspect of its existing concessions program, including specific 
contract terms and conditions and general concession management 
policies and practices.
    5. Estimated cost to the Federal Government: CBO estimates 
that, over the 1996-2002 period, the provisions of this title 
would reduce direct spending by $1.1 billion, and would result 
in proceeds from asset sales totaling $544 million. In 
addition, we estimate that the title would provide for an 
increase in discretionary spending totaling about $2.6 billion 
over the 1996-2002 period, assuming appropriation of the 
authorized amounts.
    The estimate of the changes from this provision are 
summarized in table 1.

     TABLE 1.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON TRANSPORTATION AND    
                                                 INFRASTRUCTURE                                                 
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                    19976     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Estimated budget authority.......................      -78     -129     -134     -188     -192     -196     -200
Estimated outlays................................      -78     -129     -134     -188     -192     -196     -200
                                                                                                                
                                          RECEIPTS FROM ASSET SALES \1\                                         
                                                                                                                
Estimated budget authority.......................       -2      -42        0     -500        0        0        0
Estimated outlays................................       -2      -42        0     -500        0        0        0
                                                                                                                
                              ADDITIONAL SPENDING SUBJECT TO APPROPRIATIONS ACTION                              
                                                                                                                
Estimated authority level........................      627      645      624      626      626      105      106
Estimated outlays................................       25      165      341      471      591      608      495
                                                                                                                
                                                    REVENUES                                                    
                                                                                                                
Estimated revenues...............................    (\2\)    (\2\)    (\2\)    (\2\)    (\2\)    (\2\)   (\2\) 
----------------------------------------------------------------------------------------------------------------
\1\ Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes of
  congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in   
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   
\2\ Less than $500,000.                                                                                         

    The cost of this title fall primarily within budget 
functions 050, 300, 400, 450, and 700.
    6. Basis of estimate: For purposes of this estimate, CBO 
assumes that the reconciliation bill will be enacted by 
November 15, 1995; the estimate could change if the bill is 
enacted later.
    Charging fees for parking at Federal facilities.--Section 
10404 would provide that each executive agency charge users the 
commercial value of any parking furnished at Government 
expense. Charges collected would be deposited in the Treasury. 
The General Services Administration [GSA] would be responsible 
for prescribing any regulations including the method for 
determining commercial value. Agencies would be responsible for 
expenses related to operating and maintaining the spaces and 
would have 90 days from enactment to begin charging any fees. 
Spaces reserved for official vehicles would be exempt. In 
addition, the provision would not apply to Members or employees 
of the Congress.
    Based on the available data regarding the number of Federal 
parking spaces, commercial parking rates, and an expected 
decline in the demand for parking by users as a result of 
higher rates, CBO estimates that charging fees for parking 
would result in new offsetting receipts totaling $821 million 
over 7 years. This estimate assumes that agencies would begin 
imposing parking fees on March 1, 1996. The effects of section 
10404 are summarized in table 2.

     TABLE 2.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL TO CHARGE PARKING FEES AT FEDERAL FACILITIES     
                                    [By fiscal years in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                           CHANGES IN DIRECT SPENDING                                           
                                                                                                                
Estimated budget authority........................     -65     -116     -120     -124     -128     -132     -136
Estimated outlays.................................     -65     -116     -120     -124     -128     -132     -136
----------------------------------------------------------------------------------------------------------------

    Extensions of existing Federal fees.--Two provisions would 
extend fees that would otherwise expire during the 1996-2002 
period. First, section 10004 would extend, through fiscal year 
2005, the authority of the Federal Emergency Management Agency 
[FEMA] to charge fees for radiological emergency preparedness. 
The legislation would require that the fees be deposited in the 
general fund of the Treasury as offsetting receipts. At 
present, these fees total about $12 million each year and are 
credited as offsetting collections to appropriations. We 
estimate that the new authority would generate similar amounts 
in each of fiscal years 1996 through 2002. (At present, both 
the Senate and House versions of the VA, HUD, and Independent 
Agencies appropriations bill authorize radiological fees to be 
collected for fiscal year 1996. If the appropriations bill is 
enacted prior to the passage of the reconciliation bill, then 
this provision would produce no savings in fiscal year 1996.) 
Table 3 summarizes the budgetary effects of section 10004.

               TABLE 3.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON FEMA RADIOLOGICAL FEES              
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995    1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
Spending under current law:                                                                                     
    Estimated budget authority..................     -12  ......  ......  ......  ......  ......  ......  ......
    Estimated outlays...........................     -12  ......  ......  ......  ......  ......  ......  ......
Proposed changes \1\:                                                                                           
    Estimated budget authority..................  ......     -12     -12     -12     -12     -12     -12     -12
    Estimated outlays...........................  ......     -12     -12     -12     -12     -12     -12     -12
Spending under proposal:                                                                                        
    Estimated budget authority..................     -12     -12     -12     -12     -12     -12     -12     -12
    Estimated outlays...........................     -12     -12     -12     -12     -12     -12     -12     -12
----------------------------------------------------------------------------------------------------------------
\1\ The table entries reflect changes to current law; if the VA-HUD appropriations bill is enacted before this  
  provision and extends the collection of the $12 million of fees for radiological emergency preparedness in    
  1996, this provision would not produce any savings in 1996.                                                   

    Second, section 10401 would extend, through fiscal year 
2002, the increase in vessel tonnage duties that was enacted 
(and subsequently extended) in two earlier reconciliation acts. 
These earlier acts increased per-ton duties from $0.02 to $0.09 
(up to a maximum of $0.45 per ton annually) on vessels entering 
the United States from Western Hemisphere foreign ports and 
from $0.06 to $0.27 (up to a maximum annual duty of $1.35 per 
ton) on those arriving from other foreign ports. As specified 
in the earlier acts, the additional amounts collected would be 
deposited into the general fund as offsetting receipts. Based 
on current levels of shipping traffic at U.S. ports, CBO 
estimates that the enactment of this section would increase 
offsetting receipts by $49 million in each of fiscal years 1999 
through 2002. These estimates are summarized in table 4.

               TABLE 4.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON VESSEL TONNAGE DUTIES               
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                   1995    1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
Spending under current law:                                                                                     
    Estimated budget authority..................     -49     -49     -49     -49  ......  ......  ......  ......
    Estimated outlays -49.......................     -49     -49     -49     -49  ......  ......  ......        
Proposed changes:                                                                                               
    Estimated budget authority..................  ......  ......  ......  ......     -49     -49     -49     -49
    Estimated outlays...........................  ......  ......  ......  ......     -49     -49     -49     -49
Spending under proposal:                                                                                        
    Estimated budget authority..................     -49     -49     -49     -49     -49     -49     -49     -49
    Estimated outlays...........................     -49     -49     -49     -49     -49     -49     -49     -49
----------------------------------------------------------------------------------------------------------------

    Ocean shipping reform.--Subtitle B would provide for a 
phased deregulation of the ocean shipping industry, including 
the repeal of tariff filing requirements, reduced Federal 
oversight of contracting activities, and termination of many of 
the regulatory functions carried out by the Federal Maritime 
Commission [FMC] under the Shipping Act of 1984. In addition, 
section 10241 would require the Office of Management and 
Budget, in consultation with the Department of Transportation 
[DOT] to develop and implement a plan for eliminating the 
Federal Maritime Commission [FMC] over the next 2 years. Any 
FMC functions that would still need to be performed once the 
industry is deregulated would be transferred to DOT. The bill 
would authorize the appropriation of such sums as are necessary 
for these purposes.
    Assuming appropriations of the necessary sums, CBO 
estimates that the administration would spend about $1 million 
in 1996 and a total of about $5 million over the following 2 
years to implement this legislation. In 1996, the additional 
funds would be needed for plan development and costs associated 
with transferring FMC functions and employees (about 20 
positions) to DOT. In 1997, most of the additional funds would 
be used for severance payments and other employee termination 
costs.
    Midewin National Tallgrass Prairie.--Subtitle C, which 
would provide for the disposal of land and other Federal 
property at the Joliet Army Ammunition Plant [Arsenal] and the 
establishment of the Midewin National Tallgrass Prairie, would 
increase Federal offsetting receipts from asset sales in fiscal 
years 1996 and 1997 and result in other small changes in direct 
spending authority beginning in 1996. Assuming appropriation of 
the authorized amounts, CBO estimates that implementing this 
subtitle would increase discretionary spending in each year 
over the 1996-2002 period as well. Table 5 summarizes the 
estimated budgetary effects of subtitle C.

       TABLE 5.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON THE MIDEWIN NATIONAL TALLGRASS PRAIRIE      
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                           1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                          RECEIPTS FROM ASSET SALES \1\                                         
                                                                                                                
Estimated budget authority..............................      -2      -2       0       0       0       0       0
Estimated outlays.......................................      -2      -2       0       0       0       0       0
                                                                                                                
                               CHANGES IN OFFSETTING RECEIPTS AND DIRECT SPENDING                               
                                                                                                                
Offsetting receipts:                                                                                            
Estimated budget authority..............................       0       0      -2      -3      -3      -3      -3
Estimated outlays.......................................       0       0      -2      -3      -3      -3      -3
Direct spending:                                                                                                
Estimated budget authority..............................      -1      -1   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)
Estimated outlays.......................................      -1      -1   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)
Net spending:                                                                                                   
Estimated budget authority..............................      -1      -1      -2      -3      -3      -3      -3
Estimated outlays.......................................      -1      -1      -2      -3      -3      -3      -3
                                                                                                                
                              ADDITIONAL SPENDING SUBJECT TO APPROPRIATIONS ACTION                              
                                                                                                                
Estimated authorization level...........................       4      18       2       4       4       5       6
Estimated outlays.......................................       2       5       6       9       9       5       6
----------------------------------------------------------------------------------------------------------------
\1\ Under the 1996 budget resolution, proceeds from asset sales are counted in the budget totals for purposes of
  congressional scoring. Under the Balanced Budget Act, however, proceeds from asset sales are not counted in   
  determining compliance with the discretionary spending limits or pay-as-you-go requirement.                   
\2\ Less than $500,000.                                                                                         

    Under section 10312, about 16,000 acres of the Joliet 
arsenal would be transferred to the Department of Agriculture 
during fiscal year 1996. (An additional 3,000 acres would be 
transferred once ongoing environmental cleanup of the arsenal 
has been completed by the Army.) At that time, the U.S. Forest 
Service would establish the site as the Midewin National 
Tallgrass Prairie [MNP], a unit of the National Forest System. 
Chapter 3 of this subtitle would direct the Secretary of the 
Army to transfer (without reimbursement) other arsenal lands to 
various Government agencies, including (1) about 982 acres to 
the U.S. Department of Veterans Affairs for a national 
cemetery, (2) about 455 acres to Will County, IL, for a 
landfill, and (3) about 3,000 acres to the State of Illinois 
for economic development purposes.
    Section 10315, which specifies management requirements for 
the MNP, would affect the level of offsetting receipts and 
direct spending. This section would increase receipts by 
authorizing the Forest Service to (1) sell facilities and other 
surplus arsenal property and (2) charge entrance, occupancy, 
and other user fees at the new unit. Amounts collected from 
asset sales and new receipts would be deposited into a new 
special fund, which would be available (subject to 
appropriation) for development and administration of the MNP. 
Based on information provided by the Forest Service, CBO 
estimates that the agency would sell arsenal improvements such 
as railroad equipment soon after it receives the bulk of the 
arsenal property in 1996. Such asset sales would increase 
offsetting receipts by about $2 million in each of fiscal years 
1996 and 1997. In addition, CBO expects that the Forest Service 
would begin charging entrance and other recreational fees 
within 3 or 4 years of establishing the MNP. We estimate that 
such fees would generate additional offsetting receipts of 
about $2 million in fiscal year 1998 and about $3 million 
annually thereafter. Mandatory payments to State and county 
governments would also increase, but by less than $1 million 
annually, beginning in 1998.
    Section 10315 also would direct the Forest Service to 
convert any existing agricultural leases on the transferred 
lands to new special-use authorizations. Proceeds from these 
agreements, net of additional payments to State and local 
governments would be deposited into a special fund, from which 
they would be available for appropriation to the agency. Based 
on information provided by the Forest Service and the Army, the 
level of agricultural-use receipts earned on arsenal property 
(about $1.1 million annually) would remain unchanged. However, 
direct spending authority and outlays associated with such 
receipts would be reduced by about $0.8 million each year as a 
result of the new treatment of such fees. (Currently, 100 
percent of such fees are available to the Army without 
appropriations. Section 10315 would reduce the portion treated 
as mandatory spending to 25 percent--the amount shared with 
State and local governments.)
    In aggregate, asset sales, new fees, and other changes to 
direct spending made by this subtitle would increase net 
offsetting receipts by about $3 million in fiscal year 1996 and 
by $20 million over the 7-year period.
    Subtitle C would also affect discretionary spending in each 
year, assuming appropriation of the necessary amounts. Section 
10315 would require that receipts earned at the MNP be 
deposited into special funds, from which they could be 
appropriated for prairie restoration, construction, and other 
on-site activities. CBO estimates that discretionary outlays 
for the MNP would total $2 million in fiscal year 1996 and $22 
million for the 1996-2002 period.
    The Department of Veterans Affairs [VA] also would incur 
costs for the national cemetery to be established on land 
transferred from the arsenal. The VA is using 1995 funds to 
complete the master plan for the proposed national cemetery in 
Joliet. According to VA, discretionary outlays would total less 
than $1 million to begin the design phase of the project in 
1996. VA also estimates appropriations would be required to 
initiate construction in 1997, with additional operation and 
maintenance costs once completed. Overall, we estimate 
discretionary outlays for the cemetary would total about $20 
million over the 1996-2002 period. Hence, the table shows these 
amounts as a cost of implementing the bill, which would be 
subject to appropriation of the necessary funds.
    Sale of Governors Island, NY.--Section 10402 would direct 
the Administrator of the General Services Administration [GSA] 
to sell at fair market value all Federal land and other 
property located at Governors Island in New York Harbor. The 
bill would grant New York City and the State of New York a 
right of first refusal to purchase all or part of the island. 
Proceeds from the sale would be deposited in the general fund 
as miscellaneous receipts. Based on information obtained from 
local agencies, GSA, and others, CBO estimates that selling the 
172-acre island would generate receipts of about $500 million 
in fiscal year 1999.
    At present, Governors Island is administered by the U.S. 
Coast Guard and operated as a major command center. That 
agency's current plans call for closure of the facility within 
the next 2 years. While disposition of the site under existing 
law is uncertain and could include possible transfers to other 
Federal agencies, conveyances at no cost to other agencies for 
public benefit uses, donations to nonprofit groups for homeless 
shelters, or sale, CBO believes that the property would remain 
in Federal hands for many years in the absence of legislation 
that specifically requires it to be sold. Enacting this section 
would ensure that the island would be sold rather than given 
away or retained by the Federal Government. Moreover, the 
streamlined process allowed by this section would greatly 
expedite the disposal, permitting the land to be sold shortly 
after the Coast Guard vacates all facilities and completes 
restoration activities.
    The value of Governors Island cannot be determined 
precisely in the absence of formal appraisals, which have not 
yet been conducted. Based on available information, we estimate 
that sale of this asset would generate about $500 million. 
However, depending on whether the asset transfer would occur in 
one transaction or as a combination of partial sales and other 
unknown factors such as future zoning decisions, CBO estimates 
that the Government could receive as little as $250 million or 
as much as $1 billion.
    Union Station air rights.--Section 10403 would compel 
Amtrak to convey the air rights that it owns behind the 
District of Columbia's Union Station to the Administrator of 
General Services. The Administrator would then be required to 
sell these air rights and air rights behind Union Station that 
the Federal Government owns.
    Based on various appraisals and valuations that were 
carried out between 1989 and 1992, CBO estimates that selling 
the 16.5 acres of air rights behind Union Station would produce 
about $40 million in asset sale receipts in fiscal year 1997. 
(These rights include 5.8 acres currently owned by the Federal 
Government and 10.7 acres owned by Amtrak.) Even though the 
bill would require the Administrator of General Services to 
sell the air rights by the end of fiscal year 1996, CBO does 
not believe that the sale would occur by then, because the bill 
requires that the air rights be sold at fair market value. 
Completing such a sale this fiscal year would be extremely 
difficult. Factoring in the uncertainties and risks associated 
with this real estate, CBO does not expect that anyone would 
make a full bid (of market value) in that short period of time. 
If potential buyers are to invest about $40 million for 16.5 
acres of air rights, such investors would most likely have to 
have future tenants lined up to get the necessary financing. 
CBO believes that such planning and the arrangement of 
financing would take at least a year to complete.
    CBO's estimate is lower than earlier appraisals because 
real estate experts that CBO contacted indicated that current 
prospects of governmental downsizing combined with the District 
of Columbia's financial problems have dampened enthusiasm for 
major purchases of commercial property in the District of 
Columbia. In fact, some experts believe that air rights would 
not be sold in the next 7 years. Even though this is a 
possibility, CBO believes the air rights would be sold after at 
least a year of analysis and preparation by potential buyers.
    This estimate assumes that Amtrak would convey its air 
rights to the Federal Government so that they can be sold. If 
Amtrak does not convey the rights, the bill would prohibit 
Amtrak from obligating any of its Federal grant money after 
March 1, 1996. CBO believes that this provision would compel 
Amtrak to convey its rights. However, the Transportation and 
Infrastructure Committee has also approved H.R. 1788, the 
Amtrak Reform and Privatization Act of 1995, which includes a 
provision that would allow all funds appropriated to Amtrak to 
be disbursed upon appropriation, rather than as bills come due. 
If that provision in H.R. 1788 is enacted, outlays for all of 
Amtrak's Federal funding will already have occurred before 
March 1, 1996, and hence the threat of losing funding might not 
affect Amtrak's decision to transfer the air rights in fiscal 
year 1996. Therefore, enacting H.R. 1788 could eliminate the 
savings from the sale of Amtrak's portion of Union Station air 
rights.
    Economic Development Commission.--Subsection E would 
establish an Economic Development Commission [EDC] within the 
Department of Commerce and authorize the activities of the 
Appalachian Regional Commission [ARC] for fiscal years 1996 
through 2000. The subsection would authorize annual 
appropriations of $340 million for fiscal years 1996 through 
2000 for development programs and, additionally, such sums as 
necessary through fiscal year 2002 for defense conversion 
activities. CBO's estimate of amounts needed for defense 
conversion--$100 million per year--is based on recent 
appropriations for these activities, adjusted for current base 
closure and downsizing plans. The bill would also authorize 
appropriations of $182 million each fiscal year from 1996 
through 2000 for ARC activities. In total, CBO estimates that 
the subsection would authorize $622 million for fiscal year 
1996 and $3.3 billion for the 1996-2002 period. Assuming that 
the authorized amounts are appropriated for each year, and 
based on the historical spending patterns of these programs, we 
estimate that outlays would total $22 million in fiscal year 
1996 and $2.6 billion over the 1996-2002 period.
    This subsection also would establish criminal penalties 
that are estimated to cause receipts to increase by less than 
$500,000 each fiscal year. Criminal fines would be deposited in 
the crime victims fund and would be spent without further 
appropriation in the following year. Thus, over time, any 
increase in Federal revenues from criminal penalties would be 
offset by new direct spending.
    The budgetary effects for this subsection are summarized in 
table 6.
    Prohibition on sale of Corps of Engineers projects.--
Section 10002 would prohibit the sale of any project or project 
feature operated by the Corps of Engineers. This provision 
would conflict with a provision of the reconciliation 
recommendations ordered reported by the House Resources 
Committee that would direct the Secretary of Energy to sell all 
corps facilities associated with the electricity sold by the 
Southeastern Power Administration. CBO estimates that enactment 
of both of these provisions would result in no facilities being 
sold. If such a sale were allowed to occur, CBO estimates it 
would result in net receipts to the Government of about $924 
million over the 1996-2002 period.

        TABLE 6.--BUDGETARY IMPACT OF THE RECONCILIATION PROPOSAL ON THE ECONOMIC DEVELOPMENT COMMISSION        
                                    [By fiscal years, in millions of dollars]                                   
----------------------------------------------------------------------------------------------------------------
                                                   1995    1996    1997    1998    1999    2000    2001    2002 
----------------------------------------------------------------------------------------------------------------
                                   SPENDING SUBJECT TO APPROPRIATIONS ACTION                                    
                                                                                                                
Spending under current law:                                                                                     
    Budget authority \1\........................     732  ......  ......  ......  ......  ......  ......  ......
    Estimated outlays...........................     520     546     441     278     168      49  ......  ......
Proposed changes:                                                                                               
    Estimated authorization level...............  ......     622     622     622     622     622     100     100
    Estimated outlays...........................  ......      22     156     334     462     582     603     489
Spending under proposal:                                                                                        
    Estimated authorization level \1\...........     732     622     622     622     622     622     100     100
    Estimated outlays...........................     520     568     597     611     630     631     603     489
                                                                                                                
                                     ADDITIONAL REVENUES AND DIRECT SPENDING                                    
                                                                                                                
Estimated Revenues..............................  ......   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)
Direct spending:                                                                                                
    Estimated budget authority..................  ......  ......   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)
    Estimated outlays...........................  ......  ......   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)   (\2\)
----------------------------------------------------------------------------------------------------------------
\1\ The 1995 level is the amount actually appropriated for that year.                                           
\2\ Less than $500,000.                                                                                         

    Prohibition on charges in corps concessions program.----
Section 10001 would prohibit the corps from modifying its 
existing concessions program, except as permitted under 
existing law. The provision could conflict with a provision of 
the reconciliation recommendations ordered reported by the 
House Committee on Resources that would establish new policies 
and practices to be used by the corps and other land management 
agencies; however, we estimate that any conflict would have no 
significantly budgetary effect.
    7. Estimated cost to State and local governments: Midewin 
National Tallgrass Prairie.--The bill provides that if the 
State of Illinois sells or leases any of the 3,000 acres 
transferred to it, the State must reimburse the Federal 
Government for the land's fair market value. Based on 
information from the Army, we estimate that the current market 
value could be as high as $3,000 per acre. The Illinois 
Department of Conservation does not expect to sell any land for 
at least 10 to 20 years, however, and cannot predict how much 
land might be reconveyed at that time.
    If the bill were enacted, the State of Illinois would 
receive 25 percent of the receipts from the agricultural leases 
and user-fee receipts, which would total approximately $5 
million over the 1996-2002 period.
    The bill provides that Will County, IL, and the State of 
Illinois pay the costs of any surveys necessary for the 
transfer of property. According to the Illinois Department of 
Conservation, the survey costs would be insignificant.
    In addition, the transfer of property to the State of 
Illinois is based on the condition that the Governor establish 
and maintain a redevelopment authority to oversee the 
property's economic development activities. The State estimates 
that these provisions would not result in a budgetary impact 
since recent Illinois legislation creating the authority did 
not provide State funding and defined the members as unpaid 
appointees.
    Selling Governors Island.--The bill provides the city and 
State of New York the right of first refusal in the purchase of 
Governor's Island, NY. Should either entity, or the two in 
partnership, choose to acquire the property in whole, it would 
cost them approximately $500 million.
    Economic Development Commission.--Despite termination of 
the Economic Development Agency, which in recent years has 
provided around $418 million in grant assistance to States and 
localities, CBO estimates that States and localities would 
continue to receive about the same amount in grants through the 
newly created Economic Development Commission [EDC]. The bill 
would authorize $340 million per year for EDC, which includes 
funding for EDC's salaries and expenses. By also authorizing 
funds for assisting States and localities with defense 
conversion activities (which CBO estimates would amount to an 
additional $100 million per year), the bill would provide a 
level of grant funding close to that provided under current 
law.
    States that chose to participate in the creation of the 
eight economic development regional commissions would be 
required to pay 50 percent of the commissions' administrative 
expenses. Relative to the grant amounts these States would 
receive, however, CBO does not expect these amounts to be 
significant.
    Appalachian Regional Commission.--The 13 States that 
currently receive grants from the ARC--primarily in the mid-
Atlantic and southeast regions--would continue to receive such 
assistance, but at a low level ($182 million compared to $282 
million under current law). Several programs within the ARC 
would be repealed, and the cost-sharing arrangements for most 
other programs would be changed to require State and local 
governments to pay larger shares of the costs of projects 
funded by the ARC. The only exception would be for counties 
designated as distressed, which would pay less than other 
counties.
    9. Estimate comparison: None.
    10. Previous CBO estimate: CBO has completed several 
previous estimates related to the proposed Midewin National 
Tallgrass Prairie. The earlier versions of this legislation 
were similar but varied slightly as to whether spending of 
certain receipts would be subject to appropriations. In our 
previous estimates, CBO neglected to note that current law 
requires that 25 percent of receipts from user fees would be 
paid to the State of Illinois. Thus, direct spending would be 
about $3 million higher over the 1996-2002 period than we 
previously estimated.
    11. Estimate prepared by: Federal cost estimate: Parking at 
Federal facilities, John Righter; Governor's Island, ocean 
shipping, Deborah Reis; Union Station air rights, John 
Patterson; FEMA fees, economic development, Rachel Robertson; 
Midewin National Tallgrass Prairie, Victoria Heid; Sale of 
Corps of Engineers facilities, Kim Cawley.
    State and local estimate: Karen McVey and Pepper 
Santalucia.
    12. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Oversight Findings

    Clause 2(l)(3)(A) of rule XI requires each committee report 
to contain oversight findings and recommendations required 
pursuant to clause 2(b)(1) of rule X. The Committee on 
Transportation and Infrastructure has no specific oversight 
findings.

       Oversight of Committee on Government Reform and Oversight

    Clause 2(l)(3)(D) of rule XI requires each committee report 
to contain a summary of the oversight findings and 
recommendations made by the Government Reform and Oversight 
Committee pursuant to clause 4(c)(2) of rule X, whenever such 
findings have been timely submitted. The findings and 
recommendations of the Committee on Government Reform and 
Oversight are reflected in this report.
      
                TITLE XI--COMMITTEE ON VETERANS' AFFAIRS

                          House of Representatives,
                            Committee on Veterans' Affairs,
                                Washington, DC, September 29, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear John: Pursuant to the reconciliation directives 
contained in the conference report on House Concurrent 
Resolution 67, the budget resolution for fiscal year 1996, I am 
pleased to transmit the reconciliation recommendations for 
programs within the jurisdiction of the Committee on Veterans' 
Affairs. These recommendations were approved by the full 
Committee on Veterans' Affairs on September 28, 1995, by a vote 
of 21 to 8. A copy of the legislative language is enclosed.
    The budget resolution instructs the Committee on Veterans' 
Affairs to report changes in laws within its jurisdiction that 
provide direct spending levels of $19,064,000,000 in fiscal 
year 1996, $106,116,000,000 for fiscal year 1996 through fiscal 
year 2000, and $154,860,000,000 for fiscal year 1996 through 
fiscal year 2002.
    The Committee on Veterans' Affairs recommendations include 
extensions of current laws, a modest increase in the 
prescription drug copayment schedule, a revision of the 
standard for liability resulting from medical treatment 
administered by the Department of Veterans Affairs and other 
deficit reduction measures. It also includes a very important 
veterans' health care eligibility reform initiative.
    I hope these recommendations will be of assistance to your 
committee in meeting the budget reconciliation targets.
            Sincerely,
                                                 Bob Stump,
                                                          Chairman.
    Enclosure.

                           table of contents

                                                                   Page
Transmittal letter...............................................   877
Purpose and background...........................................   878
    Subtitle A--Extension of Temporary Authorities...............   878
    Subtitle B--Other Matters....................................   880
    Subtitle C--Health Care Eligibility Reform...................   884
Section-by-section...............................................   893
Changes in existing law (Ramseyer)...............................   896
Committee votes..................................................   918
Congressional Budget Office cost estimate........................   920
Committee oversight findings.....................................   928
Oversight findings of the Committee on Government Reform and 
  Oversight......................................................   928

                         Purpose and Background

             SUBTITLE A--EXTENSION OF TEMPORARY AUTHORITIES

Requirement to make copayment

    Section 11011 would extend an existing provision of law in 
section 8013(e) of the Omnibus Budget Reconciliation Act of 
1990 [OBRA 1990], Public Law 101-508, (38 U.S.C. 1710 note). 
Current law provides that all non service-connected veterans 
who are not otherwise eligible for VA care and who have incomes 
exceeding the statutory means-test are eligible for health care 
provided by the Department of Veterans Affairs [VA] only 
subject to an agreement to make copayments for that care. In 
OBRA 1990, Congress added to the already existing copayment 
requirements a per diem of $5 for nursing home care and $10 for 
hospital care. Congress in OBRA 1990 also eliminated 
distinctions among nonservice-connected veterans with incomes 
above the means-test limit, requiring all such veterans to make 
copayments. The authority to collect these per-diem payments 
and to obtain copayments from all nonservice-connected veterans 
with incomes exceeding the means-test level expires on 
September 30, 1998, and under section 11011 would be extended 
to September 30, 2002
    Section 11011 would also extend a provision from OBRA 1990 
and the Omnibus Budget Reconciliation Act of 1993 [OBRA 1993], 
Public Law 103-66, codified in section 1722A(c) of title 38, 
United States Code. Current law requires the VA to collect a $2 
copayment for each 30-day supply of medication furnished for 
the outpatient treatment of a nonservice-connected condition of 
a veteran. Veterans with a service-connected disability rated 
50 percent or more, or veterans whose annual income does not 
exceed the maximum annual rate of pension benefit ($8,037 for 
veterans without dependent spouse or child) do not make a 
copayment. This authority expires on September 30, 1998, and 
under section 11011 would be extended to September 30, 2002.

Medical care cost recovery

    Section 11012 would extend a provision from OBRA 1990 and 
OBRA 1993 codified in section 1729(a)(2)(E) of title 38, United 
States Code. The Secretary is, under section 1729 of title 38, 
United States Code, authorized to collect reasonable costs of 
care furnished to nonservice-connected veterans. In addition, 
current law authorizes the VA to collect from a health care 
plan the reasonable cost of medical care furnished before 
October 1, 1998, to a service-connected veteran for nonservice-
connected treatment. This authority applies to care and 
services furnished before October 1, 1998, and under section 
11012 would be extended to care and services furnished before 
October 1, 2002.

Income verification

    Section 11013 would extend a provision from OBRA 1990 and 
OBRA 1993 codified in section 5317(g) of title 38, United 
States Code and section 6103(l)(7)(D) of title 26, United 
States Code. Current law authorizes the Secretary to verify the 
eligibility of recipients of, or applicants for, VA need-based 
benefits and ``means-tested'' medical care using income data 
from the Internal Revenue Service [IRS] and Social Security 
Administration [SSA]. The income data obtained by the VA from 
the IRS and the SSA is used solely to verify a veteran's or 
other benefit recipient's continued eligibility. This authority 
expires on September 30, 1998, and under section 11013 would be 
extended to September 30, 2002.

Limitation on pension for certain recipients of Medicaid-covered 
        nursing home care

    Section 11014 would extend a provision from OBRA 1990 and 
OBRA 1993 codified in section 5503(f)(7) of title 38, United 
States Code. The provision limits to $90 a month the maximum 
amount of VA need-based pension that may be paid to Medicaid-
eligible veterans and surviving spouses who have no dependents 
and who are in nursing homes participating in Medicaid. This 
section treats such individuals in the same fashion as if the 
care were being furnished at VA expense. This provision expires 
on September 30, 1998, and under section 11014 would be 
extended to September 30, 2002.

Home loan fees

    Section 11015 would extend a provision from OBRA 1990 and 
1993 codified in section 3729(a) of title 38, United States 
Code. Current law requires the VA to charge a basic fee to 
veterans and service members who use the Home Loan Guaranty 
Program. Veterans receiving or entitled to receive compensation 
for service-connected disabilities would continue to be exempt 
from payment of a loan fee. This section requires the following 
fee schedule as determined by the percentage of the 
downpayment:

Veterans:                                                     Percentage
    No down payment...............................................  2.00
    5 percent but less than 10 percent down payment...............  1.50
    10 percent or more down payment...............................  1.25
National Guardsmen and Reservists:
    No down payment...............................................  2.75
    5 percent but less than 10 percent down payment...............  2.25
    10 percent or more down payment...............................  2.00
Second or Subsequent Use..........................................  3.00

    This authority applies to loans closed before October 1, 
1998, and under section 11015 would be extended to loans closed 
before October 1, 2002.

Liquidation sales on guaranteed home loans

    Section 11016 would extend a provision from OBRA 1990 and 
1993 codified in section 3732(c)(11) of title 38, United States 
Code. Current law provides the VA with two options when 
property guaranteed through the VA Home Loan Guaranty Program 
goes into foreclosure. The VA uses a complex formula to 
determine whether it is less expensive to the Government to 
purchase and resell a property securing a VA-guaranteed home 
loan in default, or simply pay off the VA guaranty. This 
authority applies to loans closed before October 1, 1998, and 
under section 11016 would be extended to loans closed before 
October 1, 2002.

                       SUBTITLE B--OTHER MATTERS

Revision to prescription drug copayment

    Section 11021 would, in conjunction with section 11011, 
amend section 1722A(a) of title 38, United States Code, to 
increase the prescription drug copayment from $2 to $3 during 
fiscal years 1996-2002. Current law requires certain veterans 
who obtain prescriptions for treatment of any nonservice-
connected disability or condition to make a copayment. The 
requirement does not apply to a veteran with a service-
connected disability rated 50 percent or more or to a veteran 
whose annual income does not exceed the maximum annual rate of 
pension benefit--$8,037 for veterans without dependent spouse 
or child.
    Section 11021 would also amend section 5302 of title 38, 
United States Code, to eliminate the Secretary's authority to 
waive prescription drug copayments or the collection of any 
indebtedness for failure to make a prescription drug copayment. 
In 1992, the VA's Office of General Counsel issued an advisory 
opinion which held that the Secretary has authority to waive a 
veteran's debt arising from failure to make the prescription 
drug copayment. In 1994, the VA's Veterans Health 
Administration [VHA] established procedures for processing 
requests for debt waivers resulting from failure to make the 
prescription drug copayment. The Secretary's authority to waive 
such debts was delegated to facility fiscal officers or their 
designees.
    According to a white paper from the Medical Services 
Division of the VA's Office of the Budget, ``Factors Affecting 
VHA Medication Copayment Recoveries'', the Medical Care Cost 
Recovery Office ``anticipates a scarcity of denied waiver 
requests.'' The white paper further states:

          The resources expended in this process by both the 
        medical center and by the Board of Veterans' Appeals do 
        not justify the recovery. The subjective ``equity and 
        good conscience'' standards afford fiscal officers wide 
        discretion in determining whether the potential 
        recovery amount is worth the cost of an investigation 
        into the merits of the waiver requests. Since the 
        standards provide opportunity for considerable local 
        discretion, equitable treatment of all veteran waiver 
        requests cannot be guaranteed.

    The VA's copayment collections have plummeted from $53.1 
million in fiscal year 1993 to $26.2 million in fiscal year 
1994. Consequently, the committee concludes that the 
Secretary's waiver authority cannot be applied fairly and is 
administratively unworkable.

Cost-of-living adjustment for compensation and DIC recipients

    Under chapter 11 of title 38, United States Code, the VA 
pays monthly cash benefits to veterans who have service-
connected disabilities. The basic amounts of compensation paid 
are based on percentage-of-disability ratings, determined in 
multiples of 10 percentage points and assigned to the veteran. 
Special monthly rates are payable to totally disabled veterans 
with certain specific, severe disabilities and combinations of 
disabilities. Veterans with disabilities rated 30 percent or 
more also receive additional compensation for spouses, 
children, and dependent parents.
    Under chapter 13 of title 38, United States Code, the VA 
pays dependency and indemnity compensation [DIC] to survivors 
of servicemembers or veterans who died on or after January 1, 
1957, from a disease or injury incurred or aggravated during 
active service. In 1992, Public Law 102-568 established in 
section 1311 of title 38, United States Code, a new flat-rate 
benefit of $790 per month for most DIC recipients whose spouses 
died while on active duty or whose deaths resulted from 
service-connected disabilities on or after January 1, 1993. 
These are commonly known as new-law DIC recipients. The flat 
rate is currently $790. The law specifically provides, however, 
that for deaths occurring prior to January 1, 1993, the amount 
of DIC payable to a surviving spouse will be the greater of the 
amount she or he was entitled to under the old rate or the new 
rate structure. Those receiving an amount above the flat rate 
are commonly referred to as old-law recipients.
            COLA round down
    Section 11022 would amend chapter 11 and chapter 13 of 
title 38, United States Code, to specify the computation method 
of cost-of-living adjustments [COLA] in disability compensation 
and DIC rates. On December 1, 1995, the Secretary would compute 
any increase in a disability compensation and a DIC adjustment 
that is otherwise provided by law to be effective during fiscal 
year 1996. The computation for adjustments in disability 
compensation and DIC rates would provide for the same 
percentage increase as provided under such law, but, if the 
amount was not a whole dollar amount, it would be rounded down 
to the next lower dollar amount, rather than to the nearest 
whole dollar amount as has been the practice in previous years. 
According to the Congressional Research Service, a number of 
Federal programs round down COLA's to the next lower dollar, 
including military retirement, aid for dependent children, 
supplemental security income, Social Security, railroad 
retirement, civil service retirement and food stamps.
    Section 11022 would also amend chapter 11 of title 38, 
United States Code, by adding a new section to provide that the 
computation of disability compensation COLA's for fiscal years 
1997-2002 would be adjusted by a uniform percentage which is no 
more than the percentage equal to the Social Security increase 
for that fiscal year. All increased monthly rates and 
limitations other than those equal to a whole dollar amount 
would be rounded down to the next lower whole dollar amount. 
Section 11022 would also amend chapter 13 of title 38, United 
States Code, by adding a new section which would provide for 
the same manner of computation of DIC COLA's as the disability 
compensation COLA for fiscal years 1997-2002.
            Flat rate COLA for DIC
    The legislative intent in adopting the flat rate DIC 
benefit was to achieve a more equitable benefits schedule. In 
keeping with the objective of equity, the committee believes it 
is highly desirable to achieve rate equalization in the long 
term between old and new-law DIC recipients. The committee is 
particularly concerned that COLA's be structured in such a way 
that the objective of equity will be met for all DIC 
recipients. For example, in the case of the old-law survivor of 
an enlisted service member who was in the pay grade of E-9, if 
the COLA percentage given to this old-law recipient is 
calculated on the old-law rate of $899, the disparity would 
increase between this old-law recipient and an otherwise 
identical new-law recipient.
    The committee recommends an increase calculated by 
multiplying the new-law rate by the full percentage allowed.

Liability resulting from treatment administered by the Department of 
        Veterans Affairs

    Section 11023 would amend section 1151 of title 38, United 
States Code, to revise the standard for liability for injuries 
resulting from medical treatment or vocational rehabilitation 
provided by the VA. Section 1151 authorizes compensation when 
veterans suffer additional disability or death from an injury 
or aggravation of an injury resulting from examination, 
hospitalization, medical or surgical treatment, or the pursuit 
of vocational rehabilitation provided pursuant to laws 
administered by the VA. These benefits are awarded as if the 
additional disability or death were service-connected.
    The initial predecessor of section 1151 was enacted in 1924 
as part of the World War Veterans' Act. Since 1926, when the VA 
adopted its first regulation pursuant to the World War 
Veterans' Act, the VA's interpretation has been that 
compensation was authorized only in cases where the disability 
or death was proximately caused by the VA's treatment as a 
result of negligence, lack of skill or other fault on the part 
of the VA. The VA has also granted compensation upon a showing 
of ``accident'' and has defined an ``accident'' as an 
occurrence which is not reasonably foreseeable. If the care was 
properly provided, the VA did not authorize compensation for 
contemplated or foreseeable risks or complications of medical 
care.
    In 1991, the U.S. Court of Veterans Appeals decision in the 
case of Gardner v. Derwinski, 1 Vet. App. 584, 589 (1991), 
invalidated 38 C.F.R. section 3.358(c)(3), a part of the 
regulatory framework the VA had used in adjudicating claims 
under section 1151. In 1993, the U.S. Court of Appeals for the 
Federal Circuit affirmed the Court of Veterans Appeals 
decision.
    On December 12, 1994, the U.S. Supreme Court affirmed in 
Gardner v. Brown, 115 S. Ct. 552, 557 (1994), the Federal 
Circuit decision. The decision requires the VA to pay benefits 
under section 1151, not only for injuries resulting from 
improper medical treatment or accident, but also resulting from 
properly prescribed, consented to and competently administered 
medical treatment. The only exception allowed by the decision 
is ``for the necessary consequences of treatment to which [the 
veteran] consented.''
    Consequently, compensation is now payable for any 
additional disability or death attributable to proper VA 
treatment, so long as it is not a necessary consequence--a 
certainty. This is so regardless of the risks inherent in the 
procedures employed or the health perils faced in the absence 
of treatment.
    Section 11023 would establish a new standard for the award 
of compensation under chapter 11 and for dependency and 
indemnity compensation under chapter 13 of title 38, United 
States Code, for a qualifying additional disability or death of 
a veteran in the same manner as if such disability or death 
were service-connected. In order to make the VA's standard of 
liability more closely parallel to that of the private sector 
health care providers, the new standard would require that a 
qualifying additional disability or death be caused by VA 
health care and be a proximate result of negligence on the part 
of the VA in furnishing health care, or be incurred as a 
proximate result of training and rehabilitation service 
provided under 31 of title 38, United States Code. However, a 
qualifying additional disability or death caused by an event 
which was not reasonably foreseeable would also form the basis 
for VA liability.

Enhanced loan asset sale authority

    Section 11024 would extend an existing provision of law 
codified in section 3720(h)(2) of title 38, United States Code. 
Current law authorizes the Secretary to guarantee the real 
estate mortgage investment conduits [REMIC's] used to market 
vendee loans. This provision would guarantee timely payment of 
principal and interest on certificates or other securities 
issued by the REMIC's. VA home loan programs are direct, 
mandatory accounts. This program has no direct or indirect 
effect on veterans or their ability to secure home loans.
    Extending the loan asset sale program eliminates the need 
for the VA to provide servicing and converts long-term 
receivables into cash assets when the VA sells the loans. Cash 
reserves and other REMIC credit structures make the likelihood 
of payment delays extremely remote, thereby limiting the 
Government's risk in the guarantee of payment. The assurance of 
prompt payment reduces the interest the VA must pay to 
investors and increases sales receipts when the VA offers the 
securities for sale. Other sales-related costs such as those 
associated with Securities and Exchange Commission registration 
and credit rating would also be eliminated, resulting in an 
increase in potential savings. Sales volume for the VA's loan 
asset sales remains consistent at approximately $440 million 
per sale, with the VA typically holding sales three times per 
year.
    This authority expires on December 31, 1995, and under 
section 11024 would be extended to September 30, 1996.

Withholding of payments and benefits

    Section 11025 would amend section 3726 of title 38, United 
States Code, to enable the VA to refer certain loan guaranty 
debts to the IRS for offset of income tax refunds and refer 
these debts for salary offset if the debtor is identified as a 
Federal employee. Currently, Federal agencies, other than the 
VA, are prohibited by law from withholding or offsetting 
payments to veterans in order to satisfy loan guaranty debts 
unless the debtor consents in writing or a court has determined 
the debtor is liable to the VA for the debt. With this 
provision, the VA would be able to collect home loan guaranty 
debts as it currently does for all debts arising under other VA 
programs. Section 11025 would also ensure that the VA provides 
veterans with notice and opportunity to seek a waiver or 
challenge the validity of the debt before collection.

               subtitle c--health care eligibility reform

Historical perspective

    The veterans medical system was first developed to provide 
needed care to veterans injured or ill as a result of service 
during wartime. At the close of World War II, the Federal 
Government undertook the task of increasing the number of 
Veterans' Administration [VA] medical facilities to meet the 
expected demand for health care for veterans returning with 
injuries or illnesses sustained during hostilities. The primary 
focus of the buildup was the immediate medical needs of 
returning combatants for acute care, and then to address the 
longer term rehabilitation needs of more seriously injured 
veterans. Within a few years after the cessation of 
hostilities, the initial demand for acute care services for 
service-connected conditions diminished and the VA initiated 
what was later to become its specialized services mission. 
Services such as spinal cord injury care, blind rehabilitation, 
and prosthetics were very limited and almost nonexistent in the 
private medical market of the late 1940's.
    The VA system has evolved and expanded since World War II. 
Congress has enlarged the scope of the Department's health care 
mission. Through the years it has enacted legislation requiring 
the establishment of new programs and services. Through 
numerous laws, some narrowly focused, others more 
comprehensive, Congress has also extended to additional 
categories of veterans eligibility for the many levels of care 
the VA now provides. No longer a health- care system targeted 
just to the service-connected veteran, the VA has become as 
well a safety net for the many lower-income veterans who have 
come to depend upon it. Legislative proposals to ensure 
comprehensive care of all veterans, or even comprehensive care 
of the service-connected and lower income veterans, have been 
unsuccessful. Budget considerations have been a frequent brake 
on such legislative initiatives. The resulting body of VA 
health care eligibility law is one which many view as more a 
patchwork than a rational, comprehensive system.
    The long-standing call for eligibility reform reflects 
frustration with provisions of current law which are widely 
regarded as complex, confusing, and in many respects 
inconsistent with sound medical practice.

Hospital care and medical services

    Although the committee has for several years been urged to 
enact eligibility reform legislation, consensus on what should 
constitute such reform has been long in coming.
    Until this year, for example, the VA itself had failed to 
propose legislation, other than as part of the national health 
care proposal in the 103d Congress, to revise a statutory 
health care eligibility system its officials long ago 
acknowledged needed overhauling. In finally proposing specific 
draft legislation in a transmittal to the Speaker of the House 
on September 12, 1995, the Secretary of Veterans Affairs 
identified the objectives a revised eligibility system should 
achieve:

          First, the eligibility system should be one that both 
        the persons seeking care and those providing the care 
        are able to understand.
          Second, the eligibility system should ensure that the 
        VA is able to furnish patients the most appropriate 
        care and treatment that is medically needed, cost 
        effectively and in the most appropriate setting.
          Third, veterans should retain eligibility for those 
        benefits they are now eligible to receive.
          Fourth, VA management should gain the flexibility 
        needed to manage the system effectively.
          Fifth, the proposal should be budget neutral.
          Sixth, the proposal should not create any new and 
        unnecessary bureaucracy.

    Subtitle C of title XI, the Veterans Health Care 
Eligibility Reform Act of 1995, which would revise provisions 
of chapter 17 of title 38 governing eligibility for VA hospital 
and outpatient care, would achieve in full the objectives set 
forth by the Secretary. It would substitute a single uniform 
eligibility standard for the complex array of different 
standards governing access to VA hospital and outpatient care. 
While the new standard is a simple one, more importantly it 
employs a clinically appropriate ``need for care'' test, 
thereby insuring that medical judgment rather than legal 
criteria will determine when care will be provided and the 
level at which that care will be furnished.
    Section 11031 would strike the complex provisions of law 
governing eligibility for outpatient care. Those provisions, 
set forth in section 1712(a) of title 38, United States Code, 
all for the VA to apply no less than four different legal tests 
to distinct veteran classifications. Specifically, under 
section 1712(a), the VA ``shall furnish'' comprehensive 
treatment to certain service-connected veterans, ``may 
furnish'' such broad treatment to certain other classes of 
veterans, and either ``shall'' or ``may'' furnish treatment of 
more limited scope--to obviate the need of hospital admission 
or to complete treatment begun during hospitalization--to still 
other groups of veterans. In contrast, in the case of each of 
these groups--the service-connected, former prisoners-of-war, 
etc.--the VA is required to provide needed hospital care for 
any health problem under section 1710 of title 38.
    Section 11031 would amend existing law, as it applies to a 
core beneficiary group--the service-connected disabled, low-
income veterans, former prisoners of war, and World War I 
veterans--to eliminate the distinctions applicable to 
eligibility for both hospital and outpatient care. As amended, 
the VA would be authorized to provide such veterans any needed 
hospital care and outpatient medical services, to include 
preventive health services and home health care. These changes 
would expand the array of services the VA could provide many of 
these beneficiaries, while eliminating statutory barriers to 
providing care in the most economical manner.
    As amended, section 1710(a)(1) qualifies the Secretary's 
obligation to provide care as follows: ``to the extent and in 
the amount provided in advance in appropriation acts for these 
purposes''. Such language is intended to clarify that these 
services continue to depend upon discretionary appropriations; 
the act does not require a certain level of appropriations. The 
qualifying phrase, quoted above, is identical to the language 
the Secretary of Veterans Affairs has employed in the 
Department's draft bill.
    While expanding the scope of services the VA is authorized 
to provide to many of its core category A veterans--those 
described in section 1710(a)(1) of title 38--substitute C would 
not reduce any veterans' eligibility for health care benefits. 
The measure expressly addresses the status of a service-
connected veteran with a service-connected disability which is 
not compensable in degree. In the case where such a veteran is 
not otherwise afforded eligibility for hospital and medical 
services under section 1710(a)(1), as amended in subtitle C, 
new section 1706(d) would provide that such veteran would 
continue to be eligible for health-care benefits as had been 
provided prior to the enactment of the Veterans Reconciliation 
Act of 1995. Other veterans--both higher-income individuals and 
veterans with special eligibility based on exposure to toxic 
substances--would continue to be eligible for services under 
existing law. In that regard, the measure assumes Senate 
adoption of House-passed H.R. 1565, addressing special 
eligibility relating to exposure to herbicides or ionizing 
radiation. Section 11032 would extend for 3 years the VA's 
expiring authority to provide health care to certain veterans 
of service in the Persian Gulf.

Prosthetics

    Section 11033 would remedy an oft-cited anomaly in VA 
health care eligibility law, provisions which bar many veterans 
who rely on VA health care from receiving needed prosthetics. 
The measure would eliminate a restriction in current law which 
effectively prohibits the VA from furnishing such needed 
devices to most nonservice-connected veterans unless the VA 
hospitalizes the individual. Under the amendment, however, VA 
prosthetics may be furnished only as part of ongoing VA care, 
regardless of the level at which that care is furnished. This 
is to clarify that the committee does not intend, for example, 
that the VA provide costly prosthetics to nonservice-connected 
veterans who do not otherwise rely on VA care and simply view 
the VA as a means to obtain services not covered by their 
health insurer.

Management of care

    The act would meet the Secretary's objective of gaining 
needed flexibility to manage VA health care effectively. For 
example, its provisions would both improve the VA's ability to 
plan and budget for meeting its medical care mission, and 
foster flexibility in delivering needed services.
    The act not only enables the VA to plan for treating 
patients in a comprehensive manner--rather than episodically 
responding to acute problems, but authorizes the VA to 
establish a system or systems of patient enrollment and thereby 
improve substantially the management of care-delivery. 
Moreover, the Act frees administrators from rigid rules on 
contracting for veterans' treatment. In place of a body of law 
limiting who could be provided treatment from a private 
physician and for what conditions, the act would vest the VA 
with authority to contract for hospital care and medical 
services on behalf of any enrollee described in new section 
1710(a)(1) when it is less costly than providing needed care 
and services in VA facilities. Further, the Act would lift 
restrictions which bar VA facilities from entering into 
arrangements with other institutions for shared use of VA 
resources, subject to reimbursement. Finally, the Act 
explicitly recognizes that the extent of the Secretary's 
obligations under law are limited by the funds made available 
in advance by appropriations acts.
    Enrollment. The act provides the VA an important tool, the 
authority to design and manage access to care through a system 
of patient enrollment. The authority to enroll patients is a 
logical extension of the longstanding statutory requirement 
that outpatient care be provided in accordance with specified 
priorities.
    While an enrollment mechanism has not previously been 
specifically authorized in law, the VA has clearly embraced 
that concept in its recent planning and begun to employ it. A 
directive issued by the Office of the Under Secretary for 
Health in October 1994, ``Guidance for the Implementation of 
Primary Care in Veterans Health Administration [VHA]'', for 
example, includes as among facilities' responsibilities in 
instituting a primary care program their responsibility to 
``define the patient population * * * to be treated'' and to 
ensure that ``every patient enrolled in primary care must have 
a primary care provider'' (emphasis added). As currently 
instituted at many VA facilities, an enrollment system does not 
involve a contractual relationship between the VA and the 
enrollee or otherwise guarantee the enrollee that the VA will 
necessarily deliver all needed care. Enrollment, however, can 
help the VA plan more effectively, so that facilities can 
better calculate and dedicate the resources needed to provide 
the care its enrollees require.
    The act directs the Secretary, in providing for the care of 
core veterans (described in new section 1710(a)(1) of title 
38), to establish and operate a system of annual patient 
enrollment, and requires that veterans be enrolled in a manner 
giving relative degrees of preference in accordance with 
specified priorities. At the same time, it vests discretion in 
the Secretary to determine the manner in which such 
enrollment--or registration--system shall operate. For example, 
VA may establish a system which simply registers patients 
throughout all or part of a fiscal year, or may employ a time-
limited registration period. Significantly, the act permits the 
Secretary to set priorities within the specified priority 
classifications established in the act. The Secretary could, 
therefore, establish a policy which, for example, within any 
priority classification, gives veterans who have previously 
been enrolled as VA patients priority over new applicants. 
However, the committee expects any enrollment system to be 
designed and administered to assure that any veteran with a 
service-connected condition would receive priority treatment 
for that condition whether or not that veteran had enrolled for 
VA care.
    The relative priority classifications in new section 1705, 
which, for example, assign highest priority to veterans with 
service-connected disabilities rated 30 percent or greater, is 
derived substantially from the prioritization requirement in 
current law at section 1712(i) of title 38, United States Code. 
In refining that prioritization requirement, the measure would 
make several noteworthy changes. The measure, for one, would 
elevate to a second tier the priority of former prisoners of 
war, who under current law occupy a lower (third) priority 
tier. Second, it would create a new category of priority for 
those otherwise eligible veterans under new section 1710(a) who 
are catastrophically disabled, such as veterans with spinal 
cord injury. Such veterans would be included within a third 
tier of priority together with other profoundly disabled 
veterans who receive increased pension based on a need of 
regular aid and attendance or permanent housebound status.
    Contracting for services.--In providing a new statutory 
framework to assist the VA in meeting the Nation's commitment 
to provide health care services to its most deserving veterans, 
the act for the first time lifts rigid limits on which patients 
can receive VA-sponsored care through contract arrangements 
with community providers. In the context of the broad policies 
of the act, such limits on contracting are unnecessary 
constraints. They serve at best as a crude means of limiting 
expenditures; in their place, the act would authorize, but not 
require, the VA to contract for hospital care and medical 
services when VA facilities cannot furnish such care and 
services economically. Such a provision is also intended to 
encourage VA facilities to assess the relative costs of in-
house and contractor-provided services, with an eye to 
contracting where significant savings can be achieved at 
comparable or better quality of service.
    A companion provision vests the Secretary with broad 
discretion to make such rules and regulations regarding 
acquisition procedures and policies as deemed necessary to 
provide needed care and services. This provision is intended to 
enable the Secretary to tailor contracting policies and process 
to the unique needs of cost-effective care delivery, and to 
free contracting officials from cumbersome procedures which 
would impede that objective.
    While generally easing restrictions in current law, the act 
does limit the Secretary in some important respects. For one, 
it provides that in designing an enrollment system and in 
providing care, the VA may not enroll or otherwise attempt to 
treat so many patients as to result either in diminishing the 
quality of care to an unacceptable level or unreasonably 
delaying the timeliness of the VA's care-delivery.
    Specialized services.--The act would further limit the VA's 
discretion as it relates to the Department's important mission 
of providing for the specialized treatment and rehabilitative 
needs of disabled veterans. While provisions of subtitle C 
otherwise vest considerable discretion in the Secretary, 
considerations unique to the VA's specialized treatment 
programs require a far more guarded response, in the 
committee's view.
    The provision of specialized services, identified generally 
in the act as the VA's service capacity to provide for the 
specialized treatment and rehabilitative needs of disabled 
veterans--including veterans with spinal cord dysfunction, 
blindness, amputations, and mental illness--constitutes a vital 
core of the VA's health care mission. The development and 
refinement over decades of specialized treatment and 
rehabilitation programs to serve these disabled populations has 
greatly enhanced the veterans' lives. The scope and quality of 
those programs is not matched in the private sector, where, 
because of the great expense associated with such care, there 
has generally been little incentive to tailor programs for 
these chronic conditions.
    Budgetary pressures and an ongoing reorganization within 
the Veterans' Health Administration raise concern on the 
committee's part that the VA's costly specialized programs may 
be particularly vulnerable and disproportionately subject to 
budget-cutting. Earlier this year, a hearing before the 
Subcommittee on Hospitals and Health Care on the proposed VHA 
reorganization produced testimony on this issue. In the 
committee's view, neither the Department's testimony nor 
subsequent actions have allayed the widespread concern that a 
newly decentralized organization, under budget pressures and 
focused heavily on instituting new primary care programs, will 
not respond to these pressure at the expense of the very 
programs on which the Department's most vulnerable 
beneficiaries depend.
    To avoid erosion of its specialized capacities, the act 
would require the Secretary to ensure that the Department's 
system-wide capacity to provide for the needs of this disabled 
population will be maintained. In setting this requirement, the 
committee does not seek to impede or discourage the development 
of new or refined treatment modes that may change the mix of VA 
services, or in any way to discourage a shift of care from 
inpatient to outpatient setting, where appropriate, but only to 
ensure that the resource levels devoted to these services 
remain at least stable.
    Given the importance of permitting programs and treatment 
methods to evolve, the committee has not sought to identify or 
catalog specific programs in either the act or in this 
discussion. Its intent is to ensure that specialized treatment 
and rehabilitation continue to be available to serve unique 
populations who suffer from the kind of profound, costly-to-
treat disabilities cited in the act. The committee notes that 
the Department has from time to time employed terms like 
``special programs'' which are more inclusive than the act's 
provision and may employ the term ``special'' for reasons 
unrelated to the profound nature of a disability. Such special 
programs are not within the ambit of this provision.
    Impact of the Act.--Although the act revises substantially 
the body of law governing VA health-care eligibility, its 
impact will be less far-reaching in practice than appears on 
its face. While the committee believes the revision of law 
proposed in the act is necessary and overdue, it appears that 
many VA medical facilities have themselves instituted changes 
in delivery practice that largely mirror the changes proposed 
in the act. As such, at many VA institutions, but certainly not 
all, the act may represent codification of VA practice more 
than a mandate for revolutionary change.
    To test this thesis, the committee's ranking member 
recently requested that the Veterans Health Administration 
conduct a survey of VA medical centers. The survey, conducted 
in early September 1995, was intended to explore the possible 
impact of eligibility reform legislation. The survey sought to 
document the extent to which the VA facilities were already 
providing primary care to patients, and to obtain some current 
measure of demand for care which might be sparked by enactment 
of reform legislation.
    In that regard, the committee took note of analyses 
prepared earlier this year by Congressional Budget Office [CBO] 
staff. For example, in attempting to estimate the costs 
associated with a legislative initiative which would have 
expanded the scope of outpatient care for service-connected 
veterans rated 30 percent and 40 percent disabled, CBO 
analysts, in attempting to derive an estimate of minimum costs, 
``assumed that the number of veterans refused outpatient care 
equals the number turned down for inpatient care.'' The 
analysts cited data derived from the 1992 Survey of Veterans to 
the effect that ``about 61,000 veterans were denied inpatient 
care who should have received care'' and concluded that number 
would rise to almost 70,000 in 1996. The Congressional Budget 
Office continues to cite the 1992 survey data as a possible 
basis on which to project additional costs stemming from an 
extension of outpatient care.
    The survey posed the following questions:
          1.a. Has your facility instituted a primary care 
        program that is, a clinic which includes at least 
        intake and initial assessment, treatment/management of 
        acute conditions, patient education/health promotion, 
        continuity of care, and access to other components of 
        VA-provided or sponsored health care)?
          b. If so, please estimate the percentage of total 
        facility unique patients enrolled in primary care.
          c. Please identify any classes of category A veterans 
        who are not currently enrolled or being enrolled in a 
        primary care program.
          2.a. During the period of fiscal year 1994, did your 
        facility find it necessary because of limited resources 
        to turn away--or provide only one-time, limited 
        treatment to--any category A veterans who needed 
        hospital or outpatient care?
          b. If so, please estimate by needed level of care the 
        numbers turned away.
    The recent VA survey indicates that with respect to needed 
hospital care, only 6 of 162 facilities either turned away 
category A veterans or provided only one-time, limited 
treatment to such individuals. With respect to outpatient 
treatment, only 22 facilities denied treatment or provided only 
one-time treatment, according to the survey.
    As the General Accounting Office noted in recent testimony, 
only veterans with service-connected disabilities rated at 50 
percent or more--about 450,000 veterans--are entitled to 
comprehensive outpatient treatment. (Another GAO report, 
profiling veterans who used VA medical centers in 1991, stated 
that of veterans receiving VA care in 1991 only 300,000 were 50 
percent service-connected disabled.) GAO noted that 
``eligibility rules impede the provision of efficient health 
care to other veterans in that they may not be eligible for 
preventive services or treatment of medical conditions until 
such conditions, if left untreated, warrant hospital care or 
specialized outpatient treatment.''
    The survey showed, however, that despite the limited 
numbers entitled to routine outpatient treatment, VA facilities 
are providing routine care to substantial percentages of their 
patients. For example, of the 162 facilities responding to the 
survey, 62 reported that 60 percent or more of their patients 
had been enrolled in primary care programs; 25 facilities 
reported that 80 percent or more of their patients were 
enrolled. In most instances, these programs are relatively new, 
and were established pursuant to the above-cited October 1994 
VA directive, ``Guidance for the Implementation of Primary Care 
in Veterans Health Administration.'' In expressing a ``need to 
implement primary care throughout VHA,'' the directive cited a 
1993 survey which ``revealed that VA does not currently provide 
primary care to a large number of veterans.'' The new policy 
pronouncement expressly directed that ``[t]he VHA will 
implement the Primary Care Program to provide primary care to 
all eligible veterans requiring coordinated care.'' The policy 
did not define the term ``eligible veterans,'' but in 
identifying the need to implement primary care, cited ``the 
development of eligibility reform proposals, the managed care 
task force report, and * * * the VA National health care reform 
report `Meeting the Challenge of Health Care Reform.' ''
    In essence, a health care system often criticized in prior 
years for its failure to provide routine outpatient care is 
undergoing a much-needed reform and increasingly delivering 
care at the least costly level. Those changes in practice have 
anticipated changes in law. Subtitle C would bring the law into 
conformity with changes already underway at many facilities. 
Those changes are clearly needed, and enactment of subtitle C 
would help accelerate further needed change.
    The recent survey underscores how little reliance can be 
placed in the Congressional Budget Office [CBO] projection of 
the costs of enacting subtitle C. CBO projects that ``the net 
cost of extending outpatient care to all core veterans''--
itself not an accurate characterization of new subsection 
1710(a)(1)--``would be $404 million in 1996'' if the number of 
veterans refused outpatient care equals the number turned down 
for inpatient care. Even if the CBO's wholly unreliable 
projection of the number of new outpatients were accurate, its 
cost projection fails to take into account substantial savings 
likely to arise from the anticipated closures in hospital beds 
and increased shift to outpatient treatment which the act 
encourages.
    In this instance, the committee places greater confidence 
in the VA's own cost assessment, which served as the 
underpinning for its own proposed eligibility reform. That 
analysis projected that over a 2-year period some 20 percent of 
the VA's inpatient workload would be shifted to outpatient 
care, resulting in inpatient cost-avoidance of $761 million, 
with a total increase in outpatient care of $533 million, with 
additional reductions of contract care and travel costs 
totaling $39 million. The VA projected that the 2-year savings 
of $268 million would be available for expanding access to 
primary care and for new outpatient workload, with the result 
that ``VA expects this [VA] proposal to be budget neutral.''

Improved efficiency in health care resource management

    Title II of Public Law 102-585 authorized an expansion of 
the cooperative arrangements between the VA and DOD facilities 
instituted under Public Law 97-174. Public Law 102-585 
authorized the Departments to enter into agreements under which 
VA facilities could provide medical services to beneficiaries 
of DOD's CHAMPUS Program. Under this new authority, the VA has 
begun to provide care to dependents of active-duty members and 
retirees. Section 11035 would repeal section 204 of Public Law 
102-585, under which this expanded VA-DOD sharing authority 
would have expired.
    Authority to bill health-plan contracts.--Section 11035 of 
the act would also clarify VA's authority to recover or collect 
from the insurance plans, including so-called CHAMPUS 
supplemental plans, of CHAMPUS beneficiaries cared for by the 
VA to the same extent as DOD recovers for care rendered to 
these beneficiaries in its facilities. This section would also 
direct that all funds received by the VA from the insurance 
plans of CHAMPUS beneficiaries be credited to the VA facility 
that furnished the care.

Expanded resource sharing

    While revising VA law governing health care eligibility 
will help the VA achieve greater efficiencies inherent in 
shifting more care from costly hospital beds to outpatient 
clinics, the act would also help the VA achieve greater 
economies through improved resource utilization.
    Under existing law, the VA may, subject to reimbursement, 
enter into agreements with specified health care entities for 
the mutual use or exchange of use of specialized medical 
resources, a narrowly defined term. Among the changes proposed 
by the act, section 11036 would authorize the VA facilities to 
enter into such sharing agreements not only with health care 
facilities but with health insurers or any other entity or 
individual, and would expand, to include support services, the 
scope of resources which might be sold or purchased under such 
a contract to any health care resource. The committee 
contemplates that the Department would broadly construe this 
new authority.
    The amendments in section 11036, developed with an eye to 
both the difficult budget environment and the dynamic 
marketplace within which the VA health care facilities are 
operating, reflect a belief that these facilities need far 
greater flexibility than existing law affords them to work out 
contractual arrangements with other providers, institutions, 
and entities to share health care resources. Both veterans 
organizations and the Department have cited the importance such 
expanded VA sharing authority holds to achieve efficiencies as 
well as new revenues.

Personnel furnishing shared resources

    The provisions of section 11037 are companion provisions to 
sections 11035 and 11036, and are intended to overcome 
disincentives in existing law to initiating or maintaining 
arrangements to share resources, and, thus, to achieve needed 
efficiencies. Under current law, VA facilities have operated 
under employment ceilings conforming to section 712 of title 
38, United States Code. Such ceilings have created a dilemma 
for many medical center directors, because they have often 
forced a choice between dedicating staff solely to internal 
service-delivery, regardless of the level of efficiency of such 
service, or to providing as well some level of service-delivery 
to other entities under the auspices of efficiency-driven 
sharing agreements. Faced with such a choice, many directors 
have opted not to embark on any new sharing agreements or 
questioned the merits of maintaining those in place. This 
tension can easily lead to facilities to choose to operate 
inefficiently simply to avoid the perverse impact an employment 
ceiling can have. Section 11037 would remedy this problem by 
exempting from the applicable personnel ceiling those staff 
involved in providing services under sharing agreements.

                           Section-by-Section

    Section 11001 would provide that this title may be cited as 
the ``Veterans Reconciliation Act of 1995.''
    Section 11011(a) would amend section 8013(e) of the Omnibus 
Budget Reconciliation Act of 1990 (38 U.S.C 1710 note) to 
extend until September 30, 2002:
          (1) provisions of the act which eliminate, for 
        purposes of priority to VA care and associated 
        copayment obligations, distinctions among veterans 
        whose incomes exceed the Category A income threshold, 
        and
          (2) the $5- and $10-per day copayment obligations 
        associated with VA provision of VA nursing home and 
        hospital care, respectively, to such higher-income 
        veterans.
    Section 11011(b) would amend section 1722A of title 38, 
United States Code, to extend until September 30, 2002, the 
VA's authority to collect a $2 copayment for each 30-day supply 
of medication furnished for the outpatient treatment of a non-
service-connected condition of certain veterans.
    Section 11012 would amend section 1729(a)(2)(E) of title 
38, United States Code, to:
          (1) extend the VA's authority to collect from a 
        health care plan the reasonable cost of medical care 
        furnished before October 1, 2002 to a service-connected 
        veteran for nonservice-connected treatment, and
          (2) temporarily eliminate the distinction in law 
        between care of service-connected disabilities and 
        other disabilities for purposes of recoveries under 
        section 1729 for care or services provided for such 
        disabilities.
    Section 11013 would amend section 5317(g) of title 38, 
United States Code and section 6103(l)(7)(D) of title 26, 
United States Code, to extend until September 30, 2002, the 
Secretary's authority to verify the eligibility of, or 
applicants for, VA need-based benefits and means-tested medical 
care using income data from the Internal Revenue Service and 
the Social Security Administration.
    Section 11014 would amend section 5503(f)(7) of title 38, 
United States Code, to extend until September 30, 2002, the 
VA's authority to limit to $90 a month the maximum amount of VA 
need-based pension that may be paid to Medicaid-eligible 
veterans and surviving spouses who have no dependents and who 
are in nursing homes that participate in Medicaid.
    Section 11015 would amend section 3729(a) of title 38, 
United States Code, to extend the VA's requirement to charge a 
basic fee to veterans and servicemembers who use the Home Loan 
Guaranty Program. The fee would apply to loans closed after 
September 20, 1993, but before October 1, 2002. Veterans 
receiving or entitled to receive compensation for service-
connected disabilities would continue to be exempt from payment 
of a loan fee.
    Section 11016 would amend section 3732(c)(11) of title 38, 
United States Code, to extend the VA's authority to anticipate 
resale losses when a property guaranteed through the VA Home 
Loan Guaranty Program goes into foreclosure. This authority 
would apply to loans closed before October 1, 2002.
    Section 11021(a) would, in conjunction with section 
11011(b), amend section 1722A(a) of title 38, United States 
Code, to increase the prescription drug copayment from $2 to $3 
during fiscal years 1996 through 2002. Veterans with a service-
connected disability rated 50 percent or more, or whose annual 
income does not exceed the maximum annual rate of pension 
benefit would continue to be exempt from the copayment 
requirement.
    Section 11021(b) would amend section 5303 of title 38, 
United States Code, to eliminate the Secretary's authority to 
waive copayments or to waive the collection of any indebtedness 
from failure to make a copayment.
    Section 11022 would amend chapter 11 and chapter 13 of 
title 38, United States Code, to specify the computation method 
of cost-of-living adjustments [COLA's] in disability 
compensation and DIC rates. The COLA's would be adjusted by a 
uniform percentage which is no more than the percentage equal 
to the social security increase--the percentage by which 
benefit amounts are payable under title II of the Social 
Security Act, 42 U.S.C. 401 et. seq., for that fiscal year. The 
computation of an increase in such benefits would include a 
round down of the compensation increase to the next lower 
dollar. Section 11022 would specify that the DIC COLA be 
calculated on the flat rate of $790 for both old and new-law 
recipients. This authority would be extended through September 
30, 2002.
    Section 11023 would amend section 1151 of title 38, United 
States Code, to revise the standard for liability for injuries 
proximately resulting from medical treatment or vocational 
rehabilitation provided by the VA. Under section 11023, the VA 
would be responsible for negligence or an event not reasonably 
foreseeable.
    Section 11024 would amend section 3720(h)(2) of title 38, 
United States Code, to extend until September 30, 1996, the 
Secretary's authority to issue and guarantee the timely payment 
of principal and interest on certificates issued by the real 
estate mortgage investment conduits that are used to market 
certain home loans.
    Section 11025 would amend section 3726 of title 38, United 
States Code, to enable the VA to refer certain loan guaranty 
debts to the IRS for offset of income tax refunds and refer 
these debts for salary offset if the debtor is identified as a 
Federal employee. Section 11025 would allow the VA to collect 
home loan guaranty debts as it currently does for all debts 
arising under other VA programs. It would also require that the 
VA provide veterans with notice and opportunity to seek a 
waiver or challenge the validity of the debt before collection.
    Section 11031 would:
          (1) amend sections 1710 and 1712 of title 38, United 
        States Code, to establish medical need as the sole 
        criterion of eligibility for VA hospital care and 
        medical services for any veteran who--
                  (a) has a compensable service-connected 
                disability,
                  (b) is a former prisoner of war,
                  (c) is unable to defray the cost of care, or
                  (d) is a veteran of World War I;
          (2) provide that such care shall be furnished subject 
        to the availability of appropriations; and
          (3) recodify other veterans' eligibility for care in 
        accordance with existing criteria.
    Section 11032 would extend expiring provisions of law 
authorizing medical care to veterans of the Persian Gulf War.
    Section 11033 would:
          (1) amend the definition of medical services in 
        chapter 17 of title 38, United States Code, to strike 
        language conditioning certain veterans' eligibility for 
        prosthetics on the individual's being hospitalized,
          (2) provide that a veteran may be furnished such 
        devices in the course of his or her VA care or 
        treatment, and
          (3) require that eyeglasses and hearing aids may only 
        be furnished in accordance with guidelines to be 
        prescribed by VA.
    Section 11034 would amend chapter 17 of title 38 applicable 
to managing delivery of care under new section 1710(a)(1) to:
          (1) require VA to administer care-delivery through an 
        annual patient enrollment, with veterans' right to 
        enroll to be governed by the availability of 
        appropriations and by reference to a system of listed 
        priorities;
          (2) require that the size of the enrollment pool be 
        governed by the requirement that provision of care to 
        enrollees be timely and acceptable in quality;
          (3) require that VA promote cost-effective delivery 
        of care in the most clinically appropriate setting; and
          (4) require VA to maintain its capacity to provide 
        for the specialized treatment needs of disabled 
        veterans; and
    Section 11034 would also:
          (1) permit VA to contract for care when its 
        facilities cannot furnish care and services 
        economically,
          (2) strike other limitations in current law on 
        contracting for care of a veteran, and
          (3) require that any service-connected veteran is 
        provided all benefits to which that individual had been 
        eligible before the act's enactment;
    Section 11035 would extend expiring law which authorizes 
the VA to provide care and services through contract 
arrangements to Department of Defense beneficiaries under 
chapter 55 of title 10, United States Code, and would clarify 
VA's authority to recover or collect from insurance plans of 
CHAMPUS beneficiaries cared for by VA.
    Section 11036 would amend provisions of subchapter IV of 
chapter 81, title 38, United States Code, to:
          (1) expand both the range of health care resources 
        which can be the subject of mutual use or exchange of 
        use contracts, and the kind of entities with which VA 
        may so contract;
          (2) provide that VA may execute such contracts 
        involving any health-care resource, and may contract 
        with any individual or entity, including a health plan;
          (3) provide greater flexibility as to when a VA 
        facility may enter into such a contract, and what 
        payment requirements it may negotiate in selling 
        services, while conditioning the circumstances under 
        which VA furnishes services to nonveterans to those--
                  (a) that would not delay or deny veteran care 
                and;
                  (b) that would result in improving the care 
                of veterans; and
          (4) clarify that VA is to be reimbursed when it 
        provides services under a sharing agreement to a 
        Medicare-covered patient.
    Section 11037 would amend section 712 of title 38, United 
States Code, to provide that for purposes of determining the 
minimum number of positions to be maintained in the Department 
of Veterans Affairs during a fiscal year, the number of 
positions in the Department in any fiscal year--to be reduced 
under existing law by reference to specified categories of 
positions--is to be further reduced by the number of positions 
in that fiscal year held by persons involved in providing 
health-care resources under sharing agreements executed under 
section 8111, as expanded by section 201 of Public Law 102-585, 
or section 8152 of title 38, United States Code.

   Changes in Existing Law Made by Title XI of the Bill, as Reported

  In compliance with clause 3 of rule XIII of the Rules of the 
House of Representatives, changes in existing law made by the 
bill, as reported, are shown as follows (existing law proposed 
to be omitted is enclosed in black brackets, new matter is 
printed in italics, existing law in which no change is proposed 
is shown in roman):

       SECTION 8013 OF THE OMNIBUS BUDGET RECONCILIATION OF 1990

SEC. 8013. MODIFICATION OF HEALTH-CARE CATEGORIES AND COPAYMENTS.

  (a) * * *
          * * * * * * *
  (e) Sunset.--The amendments made by this section expire on 
September 30, [1998] 2002.
                              ----------                              


                      TITLE 38, UNITED STATES CODE

          * * * * * * *

                       PART I--GENERAL PROVISIONS

          * * * * * * *

                          CHAPTER 7--EMPLOYEES

          * * * * * * *

Sec. 712. Full-time equivalent positions: limitation on reduction

  (a) * * *
  (b) In determining the number of full-time equivalent 
positions in the Department of Veterans Affairs during a fiscal 
year for purposes of ensuring under section 5(b) of the Federal 
Workforce Restructuring Act of 1994 (Public Law 103-226; 108 
Stat. 115; 5 U.S.C. 3101 note) that the total number of full-
time equivalent positions in all agencies of the Federal 
Government during a fiscal year covered by that section does 
not exceed the limit prescribed for that fiscal year under that 
section, the total number of full-time equivalent positions in 
the Department of Veterans Affairs during that fiscal year 
shall be the number equal to--
          (1) the number of such positions in the Department 
        during that fiscal year, reduced by
          (2) [the sum of--] the sum of the following:
                  (A) [the] The number of such positions in the 
                Department during that fiscal year that are 
                filled by employees whose salaries and benefits 
                are paid primarily from funds other than 
                appropriated funds[; and].
                  (B) [the] The number of such positions held 
                during that fiscal year by persons involved in 
                medical care cost recovery activities under 
                section 1729 of this title.
                  (C) The number of such positions in the 
                Department during that fiscal year held by 
                persons involved in providing health-care 
                resources under section 8111 or 8152 of this 
                title.
          * * * * * * *

                       PART II--GENERAL BENEFITS

          * * * * * * *

   CHAPTER 11--COMPENSATION FOR SERVICE-CONNECTED DISABILITY OR DEATH

                          subchapter i--general

Sec.
1101.  Definitions.
1102.  Special provisions relating to surviving spouses.
1103.  Cost-of-living adjustments.
          * * * * * * *

                         SUBCHAPTER I--GENERAL

          * * * * * * *

Sec. 1103. Cost-of-living adjustments

  (a) In the computation of cost-of-living adjustments for 
fiscal years 1997 through 2002 in the rates of, and dollar 
limitations applicable to, compensation payable under this 
chapter, such adjustments shall be made by a uniform percentage 
that is no more than the percentage equal to the social 
security increase for that fiscal year, with all increased 
monthly rates and limitations (other than increased rates or 
limitations equal to a whole dollar amount) rounded down to the 
next lower whole dollar amount.
  (b) For purposes of this section, the term ``social security 
increase'' means the percentage by which benefit amounts 
payable under title II of the Social Security Act (42 U.S.C. 
401 et seq.) are increased for any fiscal year as a result of a 
determination under section 215(i) of such Act (42 U.S.C. 
415(i)).
          * * * * * * *

             SUBCHAPTER VI--GENERAL COMPENSATION PROVISIONS

Sec. 1151. Benefits for persons disabled by treatment or vocational 
                    rehabilitation

  [Where any veteran shall have suffered an injury, or an 
aggravation of an injury, as the result of hospitalization, 
medical or surgical treatment, or the pursuit of a course of 
vocational rehabilitation under chapter 31 of this title, 
awarded under any of the laws administered by the Secretary, or 
as a result of having submitted to an examination under any 
such law, and not the result of such veteran's own willful 
misconduct, and such injury or aggravation results in 
additional disability to or the death of such veteran, 
disability or death compensation under this chapter and 
dependency and indemnity compensation under chapter 13 of this 
title shall be awarded in the same manner as if such 
disability, aggravation, or death were service-connected.]
  (a) Compensation under this chapter and dependency and 
indemnity compensation under chapter 13 of this title shall be 
awarded for a qualifying additional disability of a veteran or 
the qualifying death of a veteran in the same manner as if such 
disability or death were service-connected.
  (b)(1) For purposes of this section, a disability or death is 
a qualifying additional disability or a qualifying death only 
if the disability or death--
          (A) was caused by Department health care and was a 
        proximate result of--
                  (i) negligence on the part of the Department 
                in furnishing the Department health care; or
                  (ii) an event not reasonably foreseeable; or
          (B) was incurred as a proximate result of the 
        provision of training and rehabilitation services by 
        the Secretary (including by a service-provider used by 
        the Secretary for such purpose under section 3115 of 
        this title) as part of an approved rehabilitation 
        program under chapter 31 of this title.
  (2) For purposes of this section, the term ``Department 
health care'' means hospital care, medical or surgical 
treatment, or an examination that is furnished under any law 
administered by the Secretary to a veteran by a Department 
employee or in a Department facility (as defined in section 
1701(3)(A) of this title).
  (3) A disability or death of a veteran which is the result of 
the veteran's willful misconduct is not a qualifying disability 
or death for purposes of this section.
  (c) Where an individual is, on or after December 1, 1962, 
awarded a judgment against the United States in a civil action 
brought pursuant to section 1346(b) of title 28 or, on or after 
December 1, 1962, enters into a settlement or compromise under 
section 2672 or 2677 of title 28 by reason of a disability[, 
aggravation,] or death treated pursuant to this section as if 
it were service-connected, then no benefits shall be paid to 
such individual for any month beginning after the date such 
judgment, settlement, or compromise on account of such 
disability[, aggravation,] or death becomes final until the 
aggregate amount of benefits which would be paid but for this 
[sentence] subsection equals the total amount included in such 
judgment, settlement, or compromise.
  (d) Effective with respect to injuries, aggravations of 
injuries, and deaths occurring after September 30, 2002, a 
disability or death is a qualifying additional disability or a 
qualifying death for purposes of this section (notwithstanding 
the provisions of subsection (b)(1)) if the disability or 
death--
          (1) was the result of Department health care; or
          (2) was the result of the pursuit of a course of 
        vocational rehabilitation under chapter 31 of this 
        title.
          * * * * * * *

CHAPTER 13--DEPENDENCY AND INDEMNITY COMPENSATION FOR SERVICE-CONNECTED 
                                 DEATHS

                          subchapter i--general

Sec.
1301.  Definitions.
1302.  Determination of pay grade.
1303.  Cost-of-living adjustments.
     * * * * * * *

                         SUBCHAPTER I--GENERAL

          * * * * * * *

Sec. 1303. Cost-of-living adjustments

  (a) In the computation of cost-of-living adjustments for 
fiscal years 1997 through 2002 in the rates of dependency and 
indemnity compensation payable under this chapter, such 
adjustments (except as provided in subsection (b)) shall be 
made by a uniform percentage that is no more than the 
percentage equal to the social security increase for that 
fiscal year, with all increased monthly rates (other than 
increased rates equal to a whole dollar amount) rounded down to 
the next lower whole dollar amount.
  (b)(1) Cost-of-living adjustments for each of fiscal years 
1997 through 2002 in old-law DIC rates shall be in a whole 
dollar amount that is no greater than the amount by which the 
new-law DIC rate is increased for that fiscal year as 
determined under subsection (a).
  (2) For purposes of paragraph (1):
          (A) The term ``old-law DIC rates'' means the dollar 
        amounts in effect under section 1311(a)(3) of this 
        title.
          (B) The term ``new-law DIC rate'' means the dollar 
        amount in effect under section 1311(a)(1) of this 
        title.
  (c) For purposes of this section, the term ``social security 
increase'' means the percentage by which benefit amounts 
payable under title II of the Social Security Act (42 U.S.C. 
401 et seq.) are increased for any fiscal year as a result of a 
determination under section 215(i) of such Act (42 U.S.C. 
415(i)).
          * * * * * * *

   CHAPTER 17--HOSPITAL, NURSING HOME, DOMICILIARY, AND MEDICAL CARE

                          subchapter i--general

Sec.
1701.  Definitions.
1702.  Presumption relating to psychosis.
[1703.  Contracts for hospital care and medical services in non-
          Department facilities.]
1703.  Annual report on furnishing of care and services by contract.
     * * * * * * *
1705.  Management of health care: patient enrollment system.
1706.  Management of health care: other requirements.
     * * * * * * *

                         SUBCHAPTER I--GENERAL

Sec. 1701. Definitions

  For the purposes of this chapter--
  (1) * * *
          * * * * * * *
  (6) The term ``medical services'' includes, in addition to 
medical examination, treatment, and rehabilitative services--
          (A)(i) surgical services, dental services and 
        appliances as described in sections 1710 and 1712 of 
        this title, optometric and podiatric services [(in the 
        case of a person otherwise receiving care or services 
        under this chapter)], preventive health services, and 
        [(except under the conditions described in section 
        1712(a)(5)(A) of this title),] (in the case of a person 
        otherwise receiving care or services under this 
        chapter) wheelchairs, artificial limbs, trusses, and 
        similar appliances, special clothing made necessary by 
        the wearing of prosthetic appliances, and such other 
        supplies or services as the Secretary determines to be 
        reasonable and necessary, except that the Secretary may 
        not furnish sensori-neural aids other than in 
        accordance with guidelines which the Secretary shall 
        prescribe, and (ii) travel and incidental expenses 
        pursuant to the provisions of section 111 of this 
        title; and
          * * * * * * *

[Sec. 1703. Contracts for hospital care and medical services in non-
                    Department facilities

  [(a) When Department facilities are not capable of furnishing 
economical hospital care or medical services because of 
geographical inaccessibility or are not capable of furnishing 
the care or services required, the Secretary, as authorized in 
section 1710 or 1712 of this title, may contract with non-
Department facilities in order to furnish any of the following:
          [(1) Hospital care or medical services to a veteran 
        for the treatment of--
                  [(A) a service-connected disability;
                  [(B) a disability for which a veteran was 
                discharged or released from the active 
                military, naval, or air service; or
                  [(C) a disability of a veteran who has a 
                total disability permanent in nature from a 
                service-connected disability.
          [(2) Medical services for the treatment of any 
        disability of--
                  [(A) a veteran described in section 
                1712(a)(1)(B) of this title;
                  [(B) a veteran described in paragraph (2), 
                (3), or (4) of section 1712(a) of this title, 
                for a purpose described in section 
                1712(a)(5)(B) of this title; or
                  [(C) a veteran described in section 
                1712(a)(3) (other than a veteran who is a 
                former prisoner of war) of this title if the 
                Secretary has determined, based on an 
                examination by a physician employed by the 
                Department (or, in areas where no such 
                physician is available, by a physician carrying 
                out such function under a contract or fee 
                arrangement), that the medical condition of 
                such veteran precludes appropriate treatment in 
                Department facilities.
          [(3) Hospital care or medical services for the 
        treatment of medical emergencies which pose a serious 
        threat to the life or health of a veteran receiving 
        medical services in a Department facility or nursing 
        home care under section 1720 of this title until such 
        time following the furnishing of care in the non-
        Department facility as the veteran can be safely 
        transferred to a Department facility.
          [(4) Hospital care for women veterans.
          [(5) Hospital care, or medical services that will 
        obviate the need for hospital admission, for veterans 
        in a State (other than the Commonwealth of Puerto Rico) 
        not contiguous to the contiguous States, except that 
        the annually determined hospital patient load and 
        incidence of the furnishing of medical services to 
        veterans hospitalized or treated at the expense of the 
        Department in Government and non-Department facilities 
        in each such noncontiguous State shall be consistent 
        with the patient load or incidence of the furnishing of 
        medical services for veterans hospitalized or treated 
        by the Department within the 48 contiguous States and 
        the Commonwealth of Puerto Rico.
          [(6) Diagnostic services necessary for determination 
        of eligibility for, or of the appropriate course of 
        treatment in connection with, furnishing medical 
        services at independent Department out-patient clinics 
        to obviate the need for hospital admission.
          [(7) Outpatient dental services and treatment, and 
        related dental appliances, for a veteran described in 
        section 1712(b)(1)(F) of this title.
          [(8) Diagnostic services (on an inpatient or 
        outpatient basis) for observation or examination of a 
        person to determine eligibility for a benefit or 
        service under laws administered by the Secretary.
  [(b) In the case of any veteran for whom the Secretary 
contracts to furnish care or services in a non-Department 
facility pursuant to a provision of subsection (a) of this 
section, the Secretary shall periodically review the necessity 
for continuing such contractual arrangement pursuant to such 
provision.]

Sec. 1703. Annual report on furnishing of care and services by contract

  [(c)] The Secretary shall include in the budget documents 
which the Secretary submits to Congress for any fiscal year a 
detailed report on the furnishing of contract care and services 
during the most recently completed fiscal year under [this 
section, sections] sections 1710, 1712A, 1720, 1720A, 1724, and 
1732 of this title, and section 115 of the Veterans' Benefits 
and Services Act of 1988 (Public Law 100-322; 102 Stat. 501).
          * * * * * * *

Sec. 1705. Management of health care: patient enrollment system

  (a) In managing the provision of hospital care and medical 
services under section 1710(a)(1) of this title, the Secretary, 
in accordance with regulations the Secretary shall prescribe, 
shall establish and operate a system of annual patient 
enrollment. The Secretary shall manage the enrollment of 
veterans in accordance with the following priorities, in the 
order listed:
          (1) Veterans with service-connected disabilities 
        rated 30 percent or greater.
          (2) Veterans who are former prisoners of war and 
        veterans with service connected disabilities rated 10 
        percent or 20 percent.
          (3) Veterans who are in receipt of increased pension 
        based on a need of regular aid and attendance or by 
        reason of being permanently housebound and other 
        veterans who are catastrophically disabled.
          (4) Veterans not covered by paragraphs (1) through 
        (3) who are unable to defray the expenses of necessary 
        care as determined under section 1722(a) of this title.
          (5) All other veterans eligible for hospital care, 
        medical services, and nursing home care under section 
        1710(a)(1) of this title.
  (b) In the design of an enrollment system under subsection 
(a), the Secretary--
          (1) shall ensure that the system will be managed in a 
        manner to ensure that the provision of care to 
        enrollees is timely and acceptable in quality;
          (2) may establish additional priorities within each 
        priority group specified in subsection (a), as the 
        Secretary determines necessary; and
          (3) may provide for exceptions to the specified 
        priorities where dictated by compelling medical 
        reasons.

Sec. 1706. Management of health care: other requirements

  (a) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary 
shall, to the extent feasible, design, establish and manage 
health care programs in such a manner as to promote cost-
effective delivery of health care services in the most 
clinically appropriate setting.
  (b) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary--
          (1) may contract for hospital care and medical 
        services when Department facilities are not capable of 
        furnishing such care and services economically, and
          (2) shall make such rules and regulations regarding 
        acquisition procedures or policies as the Secretary 
        considers appropriate to provide such needed care and 
        services;
  (c) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary 
shall ensure that the Department maintains its capacity to 
provide for the specialized treatment and rehabilitative needs 
of disabled veterans described in section 1710(a) of this title 
(including veterans with spinal cord dysfunction, blindness, 
amputations, and mental illness) within distinct programs or 
facilities of the Department that are dedicated to the 
specialized needs of those veterans in a manner that (1) 
affords those veterans reasonable access to care and services 
for those specialized needs, and (2) ensures that overall 
capacity of the Department to provide such services is not 
reduced below the capacity of the Department, nationwide, to 
provide those services, as of the date of the enactment of this 
section.
  (d) In managing the provision of hospital care and medical 
services under section 1710(a) of this title, the Secretary 
shall ensure that any veteran with a service-connected 
disability is provided all benefits under this chapter for 
which that veteran was eligible before the date of the 
enactment of this section.

SUBCHAPTER II--HOSPITAL, NURSING HOME, OR DOMICILIARY CARE AND MEDICAL 
                               TREATMENT

Sec. 1710. Eligibility for hospital, nursing home, and domiciliary care

  [(a)(1) The Secretary shall furnish hospital care, and may 
furnish nursing home care, which the Secretary determines is 
needed--
          [(A) to any veteran for a service-connected 
        disability;
          [(B) to a veteran whose discharge or release from the 
        active military, naval, or air service was for a 
        disability incurred or aggravated in line of duty, for 
        any disability;
          [(C) to a veteran who is in receipt of, or who, but 
        for a suspension pursuant to section 1151 of this title 
        (or both such a suspension and the receipt of retired 
        pay), would be entitled to disability compensation, but 
        only to the extent that such veteran's continuing 
        eligibility for such care is provided for in the 
        judgment or settlement described in such section, for 
        any disability;
          [(D) to a veteran who has a service-connected 
        disability rated at 50 percent or more, for any 
        disability;
          [(E) to any other veteran who has a service-connected 
        disability, for any disability;
          [(F) to a veteran who is a former prisoner of war, 
        for any disability;
          [(G) to a veteran exposed to a toxic substance, 
        radiation, or environmental hazard, as provided in 
        subsection (e) of this section;
          [(H) to a veteran of the Mexican border period or 
        World War I, for any disability; and
          [(I) to a veteran for a non-service-connected 
        disability, if the veteran is unable to defray the 
        expenses of necessary care as determined under section 
        1722(a) of this title.
  [(2) In the case of a veteran who is not described in 
paragraph (1) of this subsection, the Secretary may, to the 
extent resources and facilities are available, furnish hospital 
care and nursing home care to a veteran which the Secretary 
determines is needed for a nonservice-connected disability, 
subject to the provisions of subsection (f) of this section.]
  (a)(1) The Secretary shall, to the extent and in the amount 
provided in advance in appropriations Acts for these purposes, 
provide hospital care and medical services, and may provide 
nursing home care, which the Secretary determines is needed to 
any veteran--
          (A) with a compensable service-connected disability;
          (B) whose discharge or release from active military, 
        naval, or air service was for a compensable disability 
        that was incurred or aggravated in the line of duty;
          (C) who is in receipt of, or who, but for a 
        suspension pursuant to section 1151 of this title (or 
        both a suspension and the receipt of retired pay), 
        would be entitled to disability compensation, but only 
        to the extent that such veteran's continuing 
        eligibility for such care is provided for in the 
        judgment or settlement provided for in such section;
          (D) who is a former prisoner of war;
          (E) of the Mexican border period or of World War I;
          (F) who was exposed to a toxic substance, radiation, 
        or environmental hazard, as provided in subsection (e); 
        and
          (G) who is unable to defray the expenses of necessary 
        care as determined under section 1722(a) of this title.
  (2) In the case of a veteran who is not described in 
paragraph (1), the Secretary may, to the extent resources and 
facilities are available and subject to the provisions of 
subsection (f), furnish hospital care, medical services, and 
nursing home care which the Secretary determines is needed.
          * * * * * * *
  (e)(1)(A) Subject to paragraphs (2) and (3) of this 
subsection, a veteran--
          (i) who served on active duty in the Republic of 
        Vietnam during the Vietnam era, and
          (ii) who the Secretary finds may have been exposed 
        during such service to dioxin or was exposed during 
        such service to a toxic substance found in a herbicide 
        or defoliant used in connection with military purposes 
        during such era,

is eligible for [hospital care and nursing home care] hospital 
care, medical services, and nursing home care under [subsection 
(a)(1)(G) of this section] subsection (a)(1)(F) for any 
disability, notwithstanding that there is insufficient medical 
evidence to conclude that such disability may be associated 
with such exposure.
  (B) Subject to paragraphs (2) and (3) of this subsection, a 
veteran who the Secretary finds was exposed while serving on 
active duty to ionizing radiation from the detonation of a 
nuclear device in connection with such veteran's participation 
in the test of such a device or with the American occupation of 
Hiroshima and Nagasaki, Japan, during the period beginning on 
September 11, 1945, and ending on July 1, 1946, is eligible for 
[hospital care and nursing home care] hospital care, medical 
services, and nursing home care under [subsection (a)(1)(G) of 
this section] subsection (a)(1)(F) for any disability, 
notwithstanding that there is insufficient medical evidence to 
conclude that such disability may be associated with such 
exposure.
  (C) Subject to paragraphs (2) and (3) of this subsection, a 
veteran who the Secretary finds may have been exposed while 
serving on active duty in the Southwest Asia theater of 
operations during the Persian Gulf War to a toxic substance or 
environmental hazard is eligible for [hospital care and nursing 
home care] hospital care, medical services, and nursing home 
care under [subsection (a)(1)(G) of this section] subsection 
(a)(1)(F) for any disability, notwithstanding that there is 
insufficient medical evidence to conclude that such disability 
may be associated with such exposure.
  (2) Hospital and nursing home care and medical services may 
not be provided under [subsection (a)(1)(G) of this section] 
subsection (a)(1)(F) with respect to a disability that is 
found, in accordance with guidelines issued by the Under 
Secretary for Health, to have resulted from a cause other than 
an exposure described in subparagraph (A), (B), or (C) of 
paragraph (1) of this subsection.
  (3) Hospital and nursing home care and medical services may 
not be provided under or by virtue of [subsection (a)(1)(G) of 
this section] subsection (a)(1)(F) after June 30, 1995, or, in 
the case of care for a veteran described in paragraph (1)(C), 
after December 31, [1995] 1998.
          * * * * * * *
  [(f)] (g)(1) The Secretary may not furnish medical services 
under subsection (a) of this section (including home health 
services under section 1717 of this title) to a veteran who is 
eligible for hospital care under this chapter by reason of 
[section 1710(a)(2) of this title] subsection (a)(2) of this 
section unless the veteran agrees to pay to the United States 
the amount determined under paragraph (2) of this subsection.
  (2) A veteran who is furnished medical services under 
subsection (a) of this section and who is required under 
paragraph (1) of this subsection to agree to pay an amount to 
the United States in order to be furnished such services shall 
be liable to the United States, in the case of each visit in 
which such services are furnished to the veteran, for an amount 
equal to 20 percent of the estimated average cost (during the 
calendar year in which the services are furnished) of an 
outpatient visit in a Department facility. Such estimated 
average cost shall be determined by the Secretary.
  (3) This subsection does not apply with respect to home 
health services under section 1717 of this title to the extent 
that such services are for improvements and structural 
alterations.
  (4) Amounts collected or received by the Department under 
this subsection shall be deposited in the Treasury as 
miscellaneous receipts.
  [(g)] (h) Nothing in this section requires the Secretary to 
furnish care to a veteran to whom another agency of Federal, 
State, or local government has a duty under law to provide care 
in an institution of such government.
          * * * * * * *

Sec. 1712. Eligibility for outpatient services

  [(a)(1) Except as provided in subsection (b) of this section, 
the Secretary shall furnish on an ambulatory or outpatient 
basis such medical services as the Secretary determines are 
needed--
          [(A) to any veteran for a service-connected 
        disability (including a disability that was incurred or 
        aggravated in line of duty and for which the veteran 
        was discharged or released from the active military, 
        naval, or air service);
          [(B) for any disability of a veteran who has a 
        service-connected disability rated at 50 percent or 
        more;
          [(C) to any veteran for a disability for which the 
        veteran is in receipt of compensation under section 
        1151 of this title or for which the veteran would be 
        entitled to compensation under that section but for a 
        suspension pursuant to that section (but in the case of 
        such a suspension, such medical services may be 
        furnished only to the extent that such person's 
        continuing eligibility for medical services is provided 
        for in the judgment or settlement described in that 
        section); and
          [(D) during the period before December 31, 1995, for 
        any disability in the case of a veteran who served on 
        active duty in the Southwest Asia theater of operations 
        during the Persian Gulf War and who the Secretary finds 
        may have been exposed to a toxic substance or 
        environmental hazard during such service, 
        notwithstanding that there is insufficient medical 
        evidence to conclude that the disability may be 
        associated with such exposure.
  [(2) The Secretary shall furnish on an ambulatory or 
outpatient basis medical services for a purpose described in 
paragraph (5) of this subsection--
          [(A) to any veteran who has a service-connected 
        disability rated at 30 percent or 40 percent; and
          [(B) to any veteran who is eligible for hospital care 
        under section 1710(a) of this title and whose annual 
        income (as determined under section 1503 of this title) 
        does not exceed the maximum annual rate of pension that 
        would be applicable to the veteran if the veteran were 
        eligible for pension under section 1521(d) of this 
        title.
  [(3) The Administrator may furnish on an ambulatory or 
outpatient basis medical services which the Secretary 
determines are needed--
          [(A) to any veteran who is a former prisoner of war;
          [(B) to any veteran of the Mexican border period or 
        of World War I; and
          [(C) to any veteran who is in receipt of increased 
        pension or additional compensation or allowances based 
        on the need of regular aid and attendance or by reason 
        of being permanently housebound (or who, but for the 
        receipt of retired pay, would be in receipt of such 
        pension, compensation, or allowance).
  [(4) Subject to subsection (f) of this section, the Secretary 
may furnish on an ambulatory or outpatient basis medical 
services for a purpose described in paragraph (5) of this 
subsection to any veteran who is eligible for hospital care 
under section 1710 of this title and who is not otherwise 
eligible for such services under this subsection.
  [(5)(A) Medical services for a purpose described in this 
paragraph are medical services reasonably necessary in 
preparation for hospital admission or to obviate the need of 
hospital admission. In the case of a veteran described in 
paragraph (4) of this subsection, services to obviate the need 
of hospital admission may be furnished only to the extent that 
facilities are available.
  [(B) In the case of a veteran who has been furnished hospital 
care, nursing home care, or domiciliary care, medical services 
for a purpose described in this paragraph include medical 
services reasonably necessary to complete treatment incident to 
such care. Such medical services may not be provided for a 
period in excess of 12 months after discharge from such care. 
However, the Secretary may authorize a longer period in any 
case if the Secretary finds that a longer period is required by 
reason of the disability being treated.
  [(6) In addition to furnishing medical services under this 
subsection through Department facilities, the Secretary may 
furnish such services in accordance with section 1503 of this 
title.
  [(7) Medical services may not be furnished under paragraph 
(1)(D) with respect to a disability that is found, in 
accordance with guidelines issued by the Under Secretary for 
Health, to have resulted from a cause other than an exposure 
described in that paragraph.]
  [(b)] (a)(1) Outpatient dental services and treatment, and 
related dental appliances, shall be furnished under this 
section only for a dental condition or disability--
          (A) * * *
          * * * * * * *
  [(c)] (b) Dental services and related appliances for a dental 
condition or disability described in paragraph (1)(B) of 
subsection (b) of this section shall be furnished on a one-time 
completion basis, unless the services rendered on a one-time 
completion basis are found unacceptable within the limitations 
of good professional standards, in which event such additional 
services may be afforded as are required to complete 
professionally acceptable treatment.
  [(d)] (c) Dental appliances, wheelchairs, artificial limbs, 
trusses, special clothing, and similar appliances to be 
furnished by the Secretary under this section may be procured 
by the Secretary either by purchase or by manufacture, 
whichever the Secretary determines may be advantageous and 
reasonably necessary.
  [(f)(1) The Secretary may not furnish medical services under 
subsection (a) of this section (including home health services 
under section 1717 of this title) to a veteran who is eligible 
for hospital care under this chapter by reason of section 
1710(a)(2) of this title unless the veteran agrees to pay to 
the United States the amount determined under paragraph (2) of 
this subsection.
  [(2) A veteran who is furnished medical services under 
subsection (a) of this section and who is required under 
paragraph (1) of this subsection to agree to pay an amount to 
the United States in order to be furnished such services shall 
be liable to the United States, in the case of each visit in 
which such services are furnished to the veteran, for an amount 
equal to 20 percent of the estimated average cost (during the 
calendar year in which the services are furnished) of an 
outpatient visit in a Department facility. Such estimated 
average cost shall be determined by the Secretary.
  [(3) This subsection does not apply with respect to home 
health services under section 1717 of this title to the extent 
that such services are for improvements and structural 
alterations.
  [(4) Amounts collected or received by the Department under 
this subsection shall be deposited in the Treasury as 
miscellaneous receipts.]
  [(h)] (d) The Secretary shall furnish to each veteran who is 
receiving additional compensation or allowance under chapter 11 
of this title, or increased pension as a veteran of a period of 
war, by reason of being permanently housebound or in need of 
regular aid and attendance, such drugs and medicines as may be 
ordered on prescription of a duly licensed physician as 
specific therapy in the treatment of any illness or injury 
suffered by such veteran. The Secretary shall continue to 
furnish such drugs and medicines so ordered to any such veteran 
in need of regular aid and attendance whose pension payments 
have been discontinued solely because such veteran's annual 
income is greater than the applicable maximum annual income 
limitation, but only so long as such veteran's annual income 
does not exceed such maximum annual income limitation by more 
than $1,000.
  [(i) The Secretary shall prescribe regulations to ensure that 
special priority in furnishing medical services under this 
section and any other outpatient care with funds appropriated 
for the medical care of veterans shall be accorded in the 
following order, unless compelling medical reasons require that 
such care be provided more expeditiously:
          [(1) To a veteran (A) who is entitled to such 
        services under paragraph (1) or (2) of subsection (a) 
        of this section, or (B) who is eligible for counseling 
        and care and services under section 1720D of this 
        title, for the purposes of such counseling and care and 
        services.
          [(2) To a veteran (A) who has a service-connected 
        disability rated at less than 30-percent disabling or 
        (B) who is being examined to determine the existence or 
        severity of a service-connected disability.
          [(3) To a veteran (A) who is a former prisoner of 
        war, or (B) who is eligible for hospital care under 
        section 1710(e) of this title.
          [(4) To a veteran eligible for medical services under 
        subsection (a)(3)(B) or (a)(3)(C) of this section.
          [(5) To a veteran not covered by paragraphs (1) 
        through (4) of this subsection who is unable to defray 
        the expenses of necessary care as determined under 
        section 1722(a)(3) of this title.]
  [(j)] (e) In order to assist the Secretary of Health and 
Human Services in carrying out national immunization programs 
under other provisions of law, the Secretary may authorize the 
administration of immunizations to eligible veterans who 
voluntarily request such immunizations in connection with the 
provision of care for a disability under this chapter in any 
Department health care facility. Any such immunization shall be 
made using vaccine furnished by the Secretary of Health and 
Human Services at no cost to the Department. For such purpose, 
notwithstanding any other provision of law, the Secretary of 
Health and Human Services may provide such vaccine to the 
Department at no cost. Section 7316 of this title shall apply 
to claims alleging negligence or malpractice on the part of 
Department personnel granted immunity under such section.
          * * * * * * *

Sec. 1722A. Copayment for medications

  (a)(1) Subject to paragraph (2), the Secretary shall require 
a veteran to pay the United States [$2] $3 for each 30-day 
supply of medication furnished such veteran under this chapter 
on an outpatient basis for the treatment of a non-service-
connected disability or condition. If the amount supplied is 
less than a 30-day supply, the amount of the charge may not be 
reduced.
  [(2) The Secretary may not require a veteran to pay an amount 
in excess of the cost to the Secretary for medication described 
in paragraph (1).]
  [(3)] (2) Paragraph (1) does not apply--
          (A) to a veteran with a service-connected disability 
        rated 50 percent or more; or
          (B) to a veteran whose annual income (as determined 
        under section 1503 of this title) does not exceed the 
        maximum annual rate of pension which would be payable 
        to such veteran if such veteran were eligible for 
        pension under section 1521 of this title.
          * * * * * * *
  (c) The provisions of subsection (a) expire on September 30, 
[1998] 2002.
          * * * * * * *

Sec. 1729. Recovery by the United States of the cost of certain care 
                    and services

  (a)(1) * * *
  (2) Paragraph (1) of this subsection applies to a non-
service-connected disability--
          (A) * * *
          * * * * * * *
          (E) for which care and services are furnished before 
        October 1, [1998] 2002, under this chapter to a veteran 
        who--
                  (i) has a service-connected disability; and
                  (ii) is entitled to care (or payment of the 
                expenses of care) under a health-plan contract.
          * * * * * * *

              PART III--READJUSTMENT AND RELATED BENEFITS

          * * * * * * *

              CHAPTER 37--HOUSING AND SMALL BUSINESS LOANS

          * * * * * * *

               SUBCHAPTER III--ADMINISTRATIVE PROVISIONS

Sec. 3720. Powers of Secretary

  (a) * * *
          * * * * * * *
  (h)(1) The Secretary may, upon such terms and conditions as 
the Secretary considers appropriate, issue or approve the 
issuance of, and guarantee the timely payment of principal and 
interest on, certificates or other securities evidencing an 
interest in a pool of mortgage loans made in connection with 
the sale of properties acquired under this chapter.
  (2) The Secretary may not under this subsection guarantee the 
payment of principal and interest on certificates or other 
securities issued or approved after [December 31, 1995] 
September 30, 1996.
          * * * * * * *

Sec. 3726. Withholding of payments, benefits, etc.

  No officer, employee, department, or agency of the United 
States shall set off against, or otherwise withhold from, any 
veteran or the surviving spouse of any veteran any payments 
(other than benefit payments under any law administered by the 
Department of Veterans Affairs) which such veteran or surviving 
spouse would otherwise be entitled to receive because of any 
liability to the Secretary allegedly arising out of any loan 
made to, assumed by, or guaranteed or insured on account of, 
such veteran or surviving spouse under this chapter, [unless 
(1) there is first received the consent in writing of such 
veteran or surviving spouse, as the case may be, or (2) such 
liability and the amount thereof was determined by a court of 
competent jurisdiction in a proceeding to which such veteran or 
surviving spouse was a party.] unless the Secretary provides 
such veteran or surviving spouse with notice by certified mail 
with return receipt requested of the authority of the Secretary 
to waive the payment of indebtedness under section 5302(b) of 
this title. If the Secretary does not waive the entire amount 
of the liability, the Secretary shall then determine whether 
the veteran or surviving spouse should be released from 
liability under section 3713(b) of this title. If the Secretary 
determines that the veteran or surviving spouse should not be 
released from liability, the Secretary shall notify the veteran 
or surviving spouse of that determination and provide a notice 
of the procedure for appealing that determination, unless the 
Secretary has previously made such determination and notified 
the veteran or surviving spouse of the procedure for appealing 
the determination.
          * * * * * * *

Sec. 3729. Loan fee

  (a)(1) * * *
          * * * * * * *
  (4) With respect to a loan closed after September 30, 1993, 
and before October 1, [1998] 2002, for which a fee is collected 
under paragraph (1), the amount of such fee, as computed under 
paragraph (2), shall be increased by 0.75 percent of the total 
loan amount other than in the case of a loan described in 
subparagraph (A), (D)(ii), or (E) of paragraph (2).
  (5)(A) * * *
          * * * * * * *
  (C) This paragraph applies with respect to a loan closed 
after September 30, 1993, and before October 1, [1998] 2002.
          * * * * * * *

Sec. 3732. Procedure on default

  (a) * * *
          * * * * * * *
  (c)(1) * * *
          * * * * * * *
  (11) This subsection shall apply to loans closed before 
October 1, [1998] 2002.
          * * * * * * *

               PART IV--GENERAL ADMINISTRATIVE PROVISIONS

          * * * * * * *

          CHAPTER 53--SPECIAL PROVISIONS RELATING TO BENEFITS

          * * * * * * *

Sec. 5302. Waiver of recovery of claims by the United States

  (a) * * *
  (b) With respect to any loan guaranteed, insured, or made 
under chapter 37 of this title, the Secretary shall, except as 
provided in subsection (c) of this section, waive payment of an 
indebtedness to the Department by the veteran (as defined in 
sections 101, 3701, and 3702(a)(2)(C)(ii) of this title), or 
the veteran's spouse, following default and loss of the 
property, where the Secretary determines that collection of 
such indebtedness would be against equity and good conscience. 
An application for relief under this subsection must be made 
within one year after the date on which the veteran receives 
notice by certified mail with return receipt requested from the 
Secretary of the indebtedness. The Secretary shall include in 
the notification a statement of the right of the veteran to 
submit an application for a waiver under this subsection and a 
description of the procedures for submitting the application.
          * * * * * * *
  (f) The Secretary may not waive under this section the 
recovery of any payment or the collection of any indebtedness 
owed under section 1722A of this title.
          * * * * * * *

Sec. 5317. Use of income information from other agencies: notice and 
                    verification

  (a) * * *
          * * * * * * *
  (g) The authority of the Secretary to obtain information from 
the Secretary of the Treasury or the Secretary of Health and 
Human Services under section 6103(l)(7)(D)(viii) of the 
Internal Revenue Code of 1986 expires on September 30, [1998] 
2002.
          * * * * * * *

           CHAPTER 55--MINORS, INCOMPETENTS, AND OTHER WARDS

          * * * * * * *

Sec. 5503. Hospitalized veterans and estates of incompetent 
                    institutionalized veterans

  (a) * * *
          * * * * * * *
  (f)(1) * * *
          * * * * * * *
  (7) This subsection expires on September 30, [1998] 2002.
          * * * * * * *

            PART VI--ACQUISITION AND DISPOSITION OF PROPERTY

          * * * * * * *

   CHAPTER 81--ACQUISITION AND OPERATION OF HOSPITAL AND DOMICILIARY 
    FACILITIES; PROCUREMENT AND SUPPLY; ENHANCED-USE LEASES OF REAL 
                                PROPERTY

      subchapter i--acquisition and operation of medical facilities

Sec.
8101.  Definitions.
     * * * * * * *

subchapter iv--sharing of medical facilities, equipment, and information

[8151.  Statement of congressional purpose.]
[8152] 8151.  Definitions.
[8153] 8152.  Specialized medical resources.
[8154] 8153.  Exchange of medical information.
[8155] 8154.  Pilot programs; grants to medical schools.
[8156] 8155.  Coordination with health services development activities 
          carried out under the National Health Planning and Resources 
          Development Act of 1974.
[8157] 8156.  Joint title to medical equipment.
[8158] 8157.  Deposit in escrow.

     SUBCHAPTER I--ACQUISITION AND OPERATION OF MEDICAL FACILITIES

          * * * * * * *

Sec. 8110. Operation of medical facilities

  (a) * * *
          * * * * * * *
  (c)(1) * * *
          * * * * * * *
  (3) The provisions of paragraph (1) of this subsection do not 
apply--
          (A) to a contract or agreement under chapter 17 or 
        section 8111, 8111A, or [8153] 8152 of this title or 
        under section 1535 of title 31; or
          * * * * * * *

     SUBCHAPTER IV--SHARING OF MEDICAL FACILITIES, EQUIPMENT, AND 
                              INFORMATION

[Sec. 8151. Statement of congressional purpose

  [It is the purpose of this subchapter to improve the quality 
of hospital care and other medical service provided veterans 
under this title, by authorizing the Secretary to enter into 
agreements with medical schools, health-care facilities, and 
research centers throughout the country in order to receive 
from and share with such medical schools, health-care 
facilities, and research centers the most advanced medical 
techniques and information, as well as certain specialized 
medical resources which otherwise might not be feasibly 
available or to effectively utilize other medical resources 
with the surrounding medical community, without diminution of 
services to veterans. Among other things, it is intended, by 
these means, to strengthen the medical programs at those 
Department hospitals which are located in small cities or rural 
areas and thus are remote from major medical centers. It is 
further the purpose of this subchapter to improve the provision 
of care to veterans under this title by authorizing the 
Secretary to enter into agreements with State veterans 
facilities for the sharing of health-care resources.]

[Sec. 8152] Sec. 8151. Definitions

  For the purposes of this subchapter--
          (1) The term ``research center'' means an institution 
        (or part of an institution), the primary function of 
        which is research, training of specialists, and 
        demonstrations and which, in connection therewith, 
        provides specialized, high quality diagnostic and 
        treatment services for inpatients and outpatients.
          (2) The term ``specialized medical resources'' means 
        medical resources (whether equipment, space, or 
        personnel) which, because of cost, limited 
        availability, or unusual nature, are either unique in 
        the medical community or are subject to maximum 
        utilization only through mutual use.
          (3) The term ``health-care resource'' includes 
        hospital care, medical services, and rehabilitative 
        services, as those terms are defined in paragraphs (5), 
        (6), and (8), respectively, of section 1701 of this 
        title, any other health-care service, and any health-
        care support or administrative resource.
          (4) The term ``hospital'', unless otherwise 
        specified, includes any Federal, State, local, or other 
        public or private hospital.

[Sec. 8153] Sec. 8152. Specialized medical resources

  (a)(1) To secure certain specialized medical resources which 
otherwise might not be feasibly available, or to effectively 
utilize certain other medical resources, the Secretary may, 
when the Secretary determines it to be in the best interest of 
the prevailing standards of the Department medical care 
program, make arrangements, by contract or other form of 
agreement for the mutual use, or exchange of use, of--
          (A) [specialized medical resources] health-care 
        resources between Department health-care facilities and 
        [other health-care facilities (including organ banks, 
        blood banks, or similar institutions), research 
        centers, or medical schools] any medical school, 
        health-care provider, health-care plan, insurer, or 
        other entity or individual; and
          (B) health-care resources between Department health-
        care facilities and State home facilities recognized 
        under section 1742(a) of this title.
  (2) The Secretary may enter into a contract or other 
agreement under paragraph (1) [only if (A) such an agreement 
will obviate the need for a similar resource to be provided in 
a Department health care facility, or (B) the Department 
resources which are the subject of the agreement and which have 
been justified on the basis of veterans' care are not] if such 
resources are not, or would not be, used to their maximum 
effective capacity.
  (b) Arrangements entered into under this section shall 
provide for [reciprocal reimbursement based on a methodology 
that provides appropriate flexibility to the heads of the 
facilities concerned to establish an appropriate reimbursement 
rate after taking into account local conditions and needs and 
the actual costs to the providing facility of the resource 
involved.] payment to the Department in accordance with 
procedures that provide appropriate flexibility to negotiate 
payment which is in the best interest of the Government. Any 
proceeds to the Government received therefrom shall be credited 
to the applicable Department medical appropriation and to funds 
that have been allotted to the facility that furnished the 
resource involved.
  (c) Eligibility for hospital care and medical services 
furnished any veteran pursuant to this section shall be subject 
to the same terms as though provided in a Department health 
care facility, and provisions of this title applicable to 
persons receiving hospital care or medical services in a 
Department health care facility shall apply to veterans treated 
under this subsection.
  (d) When a Department health care facility provides hospital 
care or medical services, pursuant to a contract or agreement 
authorized by this section, to an individual who is not 
eligible for such care or services under chapter 17 of this 
title and who is entitled to hospital or medical insurance 
benefits under title XVIII of the Social Security Act (42 
U.S.C. 1395 et seq.), such benefits shall be paid, 
notwithstanding any condition, limitation, or other provision 
in that title which would otherwise [preclude such payment, in 
accordance with--
          [(1) rates prescribed by the Secretary of Health and 
        Human Services, after consultation with the Secretary, 
        and
          [(2) procedures jointly prescribed by the two 
        Secretaries to assure reasonable quality of care and 
        services and efficient and economical utilization of 
        resources,

to such facility therefor] preclude such payment to such 
facility for such care or services or, if the contract or 
agreement so provides, to the community health care facility 
which is a party to the contract or agreement.
  (e) The Secretary may make an arrangement that authorizes the 
furnishing of services by the Secretary under this section to 
individuals who are not veterans only if the Secretary 
determines--
          (1) that such an arrangement will not result in the 
        denial of, or a delay in providing access to, care to 
        any veteran at that facility; and
          (2) that such an arrangement--
                  (A) is necessary to maintain an acceptable 
                level and quality of service to veterans at 
                that facility; or
                  (B) will result in the improvement of 
                services to eligible veterans at that facility.
  [(e)] (f) The Secretary shall submit to the Congress not more 
than 60 days after the end of each fiscal year a report on the 
activities carried out under this section. Each report shall 
include--
          (1) an appraisal of the effectiveness of the 
        activities authorized in this section and the degree of 
        cooperation from other sources, financial and 
        otherwise; and
          (2) recommendations for the improvement or more 
        effective administration of such activities.

[Sec. 8154] Sec. 8153. Exchange of medical information

  (a) * * *
          * * * * * * *

[Sec. 8155] Sec. 8154. Pilot programs; grants to medical schools

  (a) * * *
  (b) The Secretary, upon the recommendation of the 
Subcommittee, is authorized to make grants to medical schools, 
hospitals, and research centers to assist such medical schools, 
hospitals, and research centers in planning and carrying out 
agreements authorized by section [8154] 8153 of this title. 
Such grants may be used for the employment of personnel, the 
construction of facilities, the purchasing of equipment when 
necessary to implement such programs, and for such other 
purposes as will facilitate the administration of this section.
          * * * * * * *

[Sec. 8156] Sec. 8155. Coordination with health services development 
                    activities carried out under the National Health 
                    Planning and Resources Development Act of 1974

  The Secretary and the Secretary of Health and Human Services 
shall, to the maximum extent practicable, coordinate programs 
carried out under this subchapter and programs carried out 
under part F of title XVI of the Public Health Service Act (42 
U.S.C. 300 et seq.).

[Sec. 8157] Sec. 8156. Joint title to medical equipment

  (a) Subject to subsection (b), the Secretary may enter into 
agreements with institutions described in section [8153(a)] 
8152(a) of this title for the joint acquisition of medical 
equipment.
  (b)(1) The Secretary may not pay more than one-half of the 
purchase price of equipment acquired through an agreement under 
subsection (a).
  (2) Any equipment to be procured under such an agreement 
shall be procured by the Secretary. Title to such equipment 
shall be held jointly by the United States and the institution.
  (3) Before equipment acquired under such an agreement may be 
used, the parties to the agreement shall arrange by contract 
under section [8153] 8152 of this title for the exchange or use 
of the equipment.
  (4) The Secretary may not contract for the acquisition of 
medical equipment to be purchased jointly under an agreement 
under subsection (a) until the institution which enters into 
the agreement provides to the Secretary its share of the 
purchase price of the medical equipment.
          * * * * * * *

[Sec. 8158] Sec. 8157. Deposit in escrow

  (a) To facilitate the procurement of medical equipment 
pursuant to section [8157] 8156 of this title, the Secretary 
may enter into escrow agreements with institutions described in 
section [8153(a)] 8152(a) of this title. Any such agreement 
shall provide that--
          (1) the institutions shall pay to the Secretary the 
        funds necessary to make a payment under section 
        [8157(b)(4)] 8156(b)(4) of this title;
          (2) the Secretary, as escrow agent, shall administer 
        those funds in an escrow account; and
          (3) the Secretary shall disburse the escrowed funds 
        to pay for such equipment upon its delivery or in 
        accordance with the contract to procure the equipment 
        and shall disburse all accrued interest or other 
        earnings on the escrowed funds to the institution.
          * * * * * * *
                              ----------                              


           SECTION 6103 OF THE INTERNAL REVENUE CODE OF 1986

SEC. 6103. CONFIDENTIALITY AND DISCLOSURE OF RETURNS AND RETURN 
                    INFORMATION

  (a) * * *
          * * * * * * *
  (l) Disclosure of Returns and Return Information for Purposes 
Other Than Tax Administration.--
          (1) * * *
          * * * * * * *
          (7) Disclosure of return information to federal, 
        state, and local agencies administering certain 
        programs under the social security act, the food stamp 
        act of 1977, or title 38, united states code, or 
        certain housing assistance programs.--
                  (A) * * *
          * * * * * * *
                  (D) Programs to which rule applies.--The 
                programs to which this paragraph applies are:
                          (i) aid to families with dependent 
                        children provided under a State plan 
                        approved under part A of title IV of 
                        the Social Security Act;
          * * * * * * *
                        Only return information from returns 
                        with respect to net earnings from self-
                        employment and wages may be disclosed 
                        under this paragraph for use with 
                        respect to any program described in 
                        clause (viii)(IV). Clause (viii) shall 
                        not apply after September 30, [1998] 
                        2002; and
          * * * * * * *
                              ----------                              


                    VETERANS HEALTH CARE ACT OF 1992

          * * * * * * *

TITLE II--HEALTH-CARE SHARING AGREEMENTS BETWEEN DEPARTMENT OF VETERANS 
                   AFFAIRS AND DEPARTMENT OF DEFENSE

          * * * * * * *

[SEC. 204. EXPIRATION OF AUTHORITY.

  [The authority to provide services pursuant to agreements 
entered into under section 201 expires on October 1, 1996.]
          * * * * * * *

SEC. 207. AUTHORITY TO BILL HEALTH-PLAN CONTRACTS.

  (a) Right To Recover.--In the case of a primary beneficiary 
(as described in section 201(2)(B)) who has coverage under a 
health-plan contract, as defined in section 1729(i)(1)(A) of 
title 38, United States Code, and who is furnished care or 
services by a Department medical facility pursuant to this 
title, the United States shall have the right to recover or 
collect charges for such care or services from such health-plan 
contract to the extent that the beneficiary (or the provider of 
the care or services) would be eligible to receive payment for 
such care or services from such health-plan contract if the 
care or services had not been furnished by a department or 
agency of the United States. Any funds received from such 
health-plan contract shall be credited to funds that have been 
allotted to the facility that furnished the care or services.
  (b) Enforcement.--The right of the United States to recover 
under such a beneficiary's health-plan contract shall be 
enforceable in the same manner as that provided by subsections 
(a)(3), (b), (c)(1), (d), (f), (h), and (i) of section 1729 of 
title 38, United States Code.
          * * * * * * *

                                ROLLCALL

    Subject: Vote on recommendations to the Budget Committee on 
reconciliation.

----------------------------------------------------------------------------------------------------------------
                                                                                                           Not  
                            Name                               Present     Absent      Yea       Nay     voting 
----------------------------------------------------------------------------------------------------------------
Bob Stump, AZ, Chairman.....................................  .........  .........        X   ........  ........
Christopher H. Smith, NJ, Vice Chairman.....................  .........  .........        X   ........  ........
Michael Bilirakis, FL.......................................  .........  .........        X   ........  ........
Floyd Spence, SC............................................  .........  .........        X   ........  ........
Tim Hutchinson, AR..........................................  .........  .........        X   ........  ........
Terry Everett, AL...........................................  .........  .........        X   ........  ........
Steve Buyer, IN.............................................  .........  .........        X   ........  ........
Jack Quinn, NY..............................................  .........  .........        X   ........  ........
Spencer Bachus, AL..........................................  .........  .........        X   ........  ........
Cliff Stearns, FL...........................................  .........  .........        X   ........  ........
Bob Ney, OH.................................................  .........  .........        X   ........  ........
Jon Fox, PA.................................................  .........  .........        X   ........  ........
Mike Flanagan, IL...........................................  .........  .........  ........  ........        X 
Bob Barr, GA................................................  .........  .........        X   ........  ........
Jerry Weller, IL............................................  .........  .........        X   ........  ........
J.D. Hayworth, AZ...........................................  .........  .........        X   ........  ........
Wes Cooley, OR..............................................  .........  .........        X   ........  ........
Dan Schaefer, CO............................................  .........  .........        X   ........  ........
G.V. (Sonny) Montgomery, MS, Ranking........................  .........  .........        X   ........  ........
Lane Evans, IL..............................................  .........  .........  ........        X   ........
Joseph P. Kennedy II, MA....................................  .........  .........  ........        X   ........
Chet Edwards, TX............................................  .........  .........        X   ........  ........
Maxine Waters, CA...........................................  .........  .........  ........  ........        X 
Bob Clement, TN.............................................  .........  .........  ........        X   ........
Bob Filner, CA..............................................  .........  .........  ........  ........        X 
Fank Tejeda, TX.............................................  .........  .........  ........        X   ........
Luis V. Gutierrez, IL.......................................  .........  .........  ........        X   ........
Scotty Baesler, KY..........................................  .........  .........  ........        X   ........
Sanford Bishop, GA..........................................  .........  .........  ........        X   ........
James E. Clyburn, SC........................................  .........  .........  ........  ........        X 
Corrine Brown, FL...........................................  .........  .........  ........        X   ........
Mike Dolye, PA..............................................  .........  .........        X   ........  ........
Frank Mascara, PA...........................................  .........  .........        X   ........  ........
                                                             ---------------------------------------------------
      Total.................................................  .........  .........       21         8         4 
----------------------------------------------------------------------------------------------------------------

                                rollcall

    Subject: Vote to include eligibility reform in 
reconciliation recommendations.

----------------------------------------------------------------------------------------------------------------
                                                                                                           Not  
                            Name                               Present     Absent      Yea       Nay     voting 
----------------------------------------------------------------------------------------------------------------
Bob Stump, AZ, Chairman.....................................  .........  .........        X   ........  ........
Christopher H. Smith, NJ, Vice Chairman.....................  .........  .........        X   ........  ........
Michael Bilirakis, FL.......................................  .........  .........        X   ........  ........
Floyd Spence, SC............................................  .........  .........        X   ........  ........
Tim Hutchinson, AR..........................................  .........  .........        X   ........  ........
Terry Everett, AL...........................................  .........  .........        X   ........  ........
Steve Buyer, IN.............................................  .........  .........        X   ........  ........
Jack Quinn, NY..............................................  .........  .........        X   ........  ........
Spencer Bachus, AL..........................................  .........  .........        X   ........  ........
Cliff Stearns, FL...........................................  .........  .........        X   ........  ........
Bob Ney, OH.................................................  .........  .........        X   ........  ........
Jon Fox, PA.................................................  .........  .........        X   ........  ........
Mike Flanagan, IL...........................................  .........  .........  ........  ........        X 
Bob Barr, GA................................................  .........  .........        X   ........  ........
Jerry Weller, IL............................................  .........  .........        X   ........  ........
J.D. Hayworth, AZ...........................................  .........  .........        X   ........  ........
Wes Cooley, OR..............................................  .........  .........        X   ........  ........
Dan Schaefer, CO............................................  .........  .........        X   ........  ........
G.V. (Sonny) Montgomery, MS, Ranking........................  .........  .........        X   ........  ........
Lane Evans, IL..............................................  .........  .........        X   ........  ........
Joseph P. Kennedy II, MA....................................  .........  .........        X   ........  ........
Chet Edwards, TX............................................  .........  .........        X   ........  ........
Maxine Waters, CA...........................................  .........  .........  ........  ........        X 
Bob Clement, TN.............................................  .........  .........        X   ........  ........
Bob Filner, CA..............................................  .........  .........  ........  ........        X 
Frank Tejeda, TX............................................  .........  .........        X   ........  ........
Louis V. Gutierrez, IL......................................  .........  .........        X   ........  ........
Scotty Baesler, KY..........................................  .........  .........        X   ........  ........
Sanford Bishop, GA..........................................  .........  .........        X   ........  ........
James E. Clyburn, SC........................................  .........  .........  ........  ........        X 
Corrine Brown, FL...........................................  .........  .........        X   ........  ........
Mike Doyle, PA..............................................  .........  .........        X   ........  ........
Frank Mascara, PA...........................................  .........  .........        X   ........  ........
                                                             ---------------------------------------------------
      Total.................................................  .........  .........       29         0         4 
----------------------------------------------------------------------------------------------------------------

               Congressional Budget Office Cost Estimates

                                     U.S. Congress,
                               Congressional Budget Office,
                                   Washington, DC, October 4, 1995.
Hon. Bob Stump,
Chairman, Committee on Veterans' Affairs,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office [CBO] 
has prepared the enclosed cost estimate for the reconciliation 
recommendations of the House Committee on Veterans' Affairs, as 
approved by the committee on September 28, 1995.
    The estimate shows the budgetary effects over the 1996-2002 
period. CBO understands that the Committee on the Budget will 
be responsible for interpreting how these proposals compare 
with the reconciliation instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995; the estimate could change if the 
bill is enacted later.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).
    Enclosure.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    1. Bill title: Title XI, Veterans Reconciliation Act of 
1995.
    2. Bill status: As approved by the House Committee on 
Veterans' Affairs on September 28, 1995.
    3. Bill purpose: This bill would reduce spending in 
programs within the jurisdiction of the House Committee on 
Veterans' Affairs.
    4. Estimated cost to the Federal Government: The following 
table shows the estimated effects of the bill on direct 
spending. In addition, the bill would make several changes to 
law that would expand eligibility for medical care for 
veterans. Although these provisions are difficult to estimate, 
CBO believes that they would significantly increase the cost of 
medical care, assuming appropriation of the necessary amounts.

----------------------------------------------------------------------------------------------------------------
                                              1996      1997      1998      1999      2000      2001      2002  
----------------------------------------------------------------------------------------------------------------
                                                                                                                
              Direct spending                                                                                   
                                                                                                                
Proposed changes:                                                                                               
    Estimated budget authority............      -261      -333      -475    -1,243    -1,319    -1,381    -1,441
    Estimated outlays.....................      -251      -320      -463    -1,230    -1,397    -1,295    -1,440
                                                                                                                
     Amounts subject to appropriations                                                                          
                                                                                                                
Health care eligibility reform:                                                                                 
    Estimated authorization level.........     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)
    Estimated outlays.....................     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)     (\1\)
----------------------------------------------------------------------------------------------------------------
\1\ See text.                                                                                                   

    5. Basis of estimate: This estimate assumes the 
reconciliation bill will be enacted by November 15, 1995; the 
estimate could change if the bill is enacted later. If enacted, 
the bill would result in savings from four programs of the 
Department of Veterans Affairs [VA]--compensation, pensions, 
medical care, and housing.

                              compensation

    Veterans compensation would be affected by two provisions. 
The combined effects of these provisions are shown in table 1.
    Revised liability standards (section 11023).--Veterans who 
are injured during treatment in a VA facility or in vocational 
rehabilitation and their survivors may be eligible to receive 
disability compensation benefits. Recent court decisions 
require that VA consider claims for compensation from veterans 
whose conditions worsen after treatment in VA facilities 
regardless of whether the cause was negligence or accident. VA 
has already begun to pay compensation to some of the 11,500 
cases that had been pending since 1991. This section would 
revise liability standards for treatment in VA facilities, in 
effect reversing the recent Supreme Court decision and allowing 
VA to deny future claims based on such incidents. This section 
would expire September 30, 2002.

                      TABLE 1.--BUDGET IMPACT OF PROPOSED CHANGES TO VETERANS COMPENSATION                      
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                            1995     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
             Direct spending                                                                                    
                                                                                                                
Spending under current law:                                                                                     
    Estimated budget authority..........    4,176   14,835   15,395   15,976   16,594   17,018   17,213   18,074
    Estimated outlays...................   14,422   13,675   15,312   15,928   16,543   18,241   15,803   16,573
Proposed changes:                                                                                               
    Estimated budget authority..........        0     -116     -268     -407     -557     -591     -614     -632
    Estimated outlays...................        0     -106     -255     -395     -545     -633     -566     -632
Spending under proposals:                                                                                       
    Estimated budget authority..........   14,176   14,719   15,127   15,569   16,037   16,427   16,599   17,442
    Estimated outlays...................   14,422   13,569   15,057   15,533   15,998   17,608   15,237   15,941
----------------------------------------------------------------------------------------------------------------

    Recent studies have found that adverse events leading to 
disability or death occur in about 4 percent of all hospital 
admissions, 80 percent of which are not caused by 
negligence.\1\ \2\ Applying this finding to the population of 
inpatients and outpatients treated in VA hospitals indicates 
that under current law, about 19,000 veterans could be newly 
eligible for compensation benefits in 1996, with an average 
annual benefit of about $5,400. Under this provision, these 
veterans would not be awarded compensation benefits.
    \1\ Trogen A. Brennan and others, ``Incidence of Adverse Events and 
Negligence in Hospitalized Patients--Results of the Harvard Medical 
Practice Study I.'' New England Journal of Medicine, vol. 324, no. 6 
(February 7, 1991), p. 370.
    \2\ Lucian L. Leaps and others, ``The Nature of Adverse Events in 
Hospitalized Patients--Results of the Harvard Medical Practice Study 
II.'' New England Journal of Medicine, vol. 324, no. 6 (February 7, 
1991), p. 377.
---------------------------------------------------------------------------
    Nor would benefits be awarded to their surviving spouses. 
Dependency and indemnity compensation [DIC] is a monthly 
benefit for surviving spouses of veterans who die from their 
service-connected disabilities. This estimate assumes that 
about 500 survivors would become eligible for DIC benefits in 
1996 under current law, with an additional 500 new cases every 
year as veterans die. The average annual DIC benefit is about 
$10,000 in 1996.
    This estimate assumes both compensation and DIC rates of 
affected veterans and survivors would be increased throughout 
the projected period by cost-of-living adjustments. Savings 
would be about $90 million in 1996 and $465 million in 2002.
    Cost-of-living allowances (section 11022).--Under CBO 
baseline assumptions, monthly rates of disability compensation 
paid to veterans and of dependency and indemnity compensation 
[DIC] paid to their survivors are increased by the same cost-
of-living adjustment [COLA] payable to Social Security 
recipients, and the results of the adjustments are rounded to 
the nearest dollar.
    This provision would change current law in two ways. First, 
it would round down to the next lower adjustments to disability 
compensation through 2002. Second, the provision would change 
the COLA provided to DIC recipients. The Dependency and 
Indemnity Compensation Reform Act of 1992 redefined the DIC 
benefit to be a constant amount in contrast to previous law 
that varied the benefit based on the military rank of the 
recipient's spouse. Beneficiaries at the time of the act could 
continue to receive their existing payment if it was higher 
than the new benefit. Under CBO baseline assumptions, 
grandfathered beneficiaries receive COLA's that are computed as 
a percentage of their benefit. This bill, however, would make 
the COLA a flat rate amount equal to the adjustment in the flat 
DIC benefit under the 1992 act and this bill.
    CBO estimated the savings from this provision using the 
current table of monthly benefits, the number of beneficiaries 
assumed in the CBO baseline, and the inflation assumptions of 
the budget resolution. Savings from this section would be about 
$20 million in 1996 and about $170 million in 2002.

                                pensions

    Veterans pensions would be affected by two provisions. 
Table 2 displays the budgetary effects of these proposals.
    Pension limits (section 11014).--This section would extend 
from September 30, 1998, to September 30, 2002, the expiration 
date on subsection 5503(f) of title 38, United States Code. 
This subsection sets a $90-per-month limit on pensions for any 
veteran without a spouse or child, or for any survivor of a 
veteran, who is receiving Medicaid coverage in a Medicaid-
approved nursing home. It also allows the beneficiary to retain 
the pension instead of having to use it to defray nursing home 
costs.
    Based on VA's experience under current law, this estimate 
assumes that the extension of the expiration date would affect 
approximately 20,000 veterans and 40,000 survivors. According 
to VA, savings averaged about $7,000 per person in 1994. Higher 
Medicaid payments to nursing homes would offset some of the 
savings credited to VA. Net savings would increase from $197 
million in 1999 to $217 million in 2002.
    This proposal would affect veterans and survivors covered 
by a Medicaid plan established by title XIX of the Social 
Security Act. Under the reconciliation recommendations of the 
House Committee on Commerce, however, Medicaid would be 
replaced by a program of block grants to States under a new 
title XXI. If the Commerce Committee's recommendations were 
enacted, and if subsection 5503(f) were not amended to apply to 
veterans and survivors covered under the new block grant, this 
section of the Veterans' Committee's recommendations would have 
no budgetary effect.
    Income verification (section 11013).--Current law 
authorizes VA to acquire information on income reported to the 
Internal Revenue Service [IRS] to verify income reported by 
recipients of VA pension benefits. This authorization expires 
on September 30, 1998. This section would extend the expiration 
date to September 30, 2002. This estimate is based on VA's 
recent experience, which has shown that about $10 million in 
new savings is achieved annually through this income match. 
Savings would grow from $10 million in 1999 to $40 million in 
2002 as each year a new cohort of veterans is subject to income 
verification. This section would also affect veterans medical 
care as described below.

                             TABLE 2.--BUDGET IMPACT OF PROPOSED CHANGES TO PENSIONS                            
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                            1995     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
             Direct spending                                                                                    
                                                                                                                
Spending under current law:                                                                                     
    Estimated budget authority..........    2,955    2,821    2,704    2,595    2,792    2,793    2,790    2,789
    Estimated outlays...................    2,958    2,599    2,714    2,604    2,776    3,013    2,569    2,789
Proposed changes:                                                                                               
    Estimated budget authority..........        0        0        0        0     -208     -224     -241     -258
    Estimated outlays...................        0        0        0        0     -207     -260     -203     -257
Spending under proposals:                                                                                       
    Estimated budget authority..........    2,955    2,821    2,704    2,595    2,584    2,569    2,549    2,531
    Estimated outlays...................    2,958    2,599    2,714    2,604    2,569    2,753    2,366    2,532
----------------------------------------------------------------------------------------------------------------

                       receipts for medical care

    Four provisions would raise receipts related to medical 
care. The budgetary effects are shown in table 3.
    Income verification (section 11013).--This provision would 
allow VA to use data from the IRS to verify the incomes of 
veterans receiving medical care from VA. Under current law, 
veterans whose income falls below a certain level qualify for 
free medical treatment. Veterans who receive free treatment, 
but are later found to be ineligible through income 
verification, could be charged the standard Medicare deductible 
($716) for the first 90 days of care, and a $10 daily 
copayment. Although future treatment for that veteran would be 
on a discretionary basis and would depend on the availability 
of space, the associated payments revert to the Treasury as 
mandatory receipts. CBO estimates that around $4 million would 
be collected in 1999 and $16 million in 2002 by extending VA's 
authority to verify incomes of certain users of VA health care.
    Medical care cost recovery authority (section 11012).--This 
section would extend through September 30, 2002, VA's authority 
to collect from third-party insurers for the cost of treating 
veterans with service-connected disabilities for their 
nonservice-connected ailments. CBO estimates that the 
collection rate for third-party recoveries would remain 
relatively constant except for inflation adjustments. CBO 
estimates that these collections would be about $200 million in 
1999 and $230 million in 2002.

               TABLE 3.--BUDGETARY IMPACT OF PROPOSED CHANGES AFFECTING RECEIPTS FOR MEDICAL CARE               
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                          1995     1996     1997     1998     1999     2000     2001      2002  
----------------------------------------------------------------------------------------------------------------
                                                                                                                
            Direct spending                                                                                     
                                                                                                                
Spending under current law:                                                                                     
    Estimated budget authority........     -579     -641     -731     -758     -577     -608      -641      -676
    Estimated outlays.................     -579     -641     -731     -758     -577     -608      -641      -676
Proposed changes:                                                                                               
    Estimated budget authority........        0      -50      -65      -68     -331     -354      -376      -401
    Estimated outlays.................        0      -50      -65      -68     -331     -354      -376      -401
Spending under proposals:                                                                                       
    Estimated budget authority........     -579     -691     -796     -826     -908     -962    -1,017    -1,077
    Estimated outlays.................     -579     -691     -796     -826     -908     -962    -1,017    -1,077
----------------------------------------------------------------------------------------------------------------

    Prescription drug copayments (section 11021).--This section 
would increase prescription drug copayments by $1 to a total of 
$3 per 30 day supply and restrict the ability of the Secretary 
of Veterans Affairs to waive prescription drug copayments for 
veterans who claim an inability to pay.
    The changes in prescription drug copayments would result in 
additional collections of $50 million in 1996. CBO estimates 
that increasing the copayment by $1 would yield additional 
collections of $23 million while restricting waivers would add 
an additional $27 million for 1996. In 2002, these provisions 
would increase collections by a total of $84 million. The 
estimates are based on VA's experience with copayments under 
current law.
    Extension of certain authorities (section 11011).--This 
section would extend through fiscal year 2002 VA's authority to 
collect per diems for hospitalization and nursing home care, 
copayments for outpatient medications, and other payments for 
medical services provided to certain veterans. In general, 
veterans are subject to copayments if their incomes are high 
enough, have a rating of less than 50 percent for a service-
connected disability, and are being treated for a nonservice-
connected ailment.
    Extending these provisions of current law would result in 
collections growing from $58 million in 1999 to about $70 
million in 2002. In 1999, $34 million would be collected from 
prescription drug copayments and $23 million would be collected 
from per diems, copayments other than for prescription drugs, 
and other receipts. These estimates are based on actual 1994 
collections for drug copayments and per diems of $27 million 
and $20 million, respectively.

                                Housing

    Veterans housing would be affected by four provisions. The 
total budgetary impact of these provisions is shown in table 4.
    Fees on housing loans (section 11015).--This section would 
extend until September 30, 2002, two provisions of law 
pertaining to the veterans Home Loan Program that are set to 
expire on September 30, 1998. Under one provision VA must 
charge certain veterans a fee of 0.75 percent of the total loan 
amount. CBO estimates that this provision would affect about 
119,000 loans each year and raise collections by about $100 
million a year.
    Under current law, veterans can reuse their home loan 
guarantee benefit if their previous debt has been repaid in 
full. The second provision of this section would require VA to 
collect a fee of 3 percent of the total loan amount from 
veterans obtaining guaranteed loans after using this benefit 
once. CBO estimates that this fee would apply to about 13,000 
loans annually and that the additional collections would exceed 
$40 million a year.
    Net value calculation (section 11016).--This section would 
extend through 2002 a provision of law that requires VA to 
consider the losses it might incur when selling a property it 
may acquire through a foreclosure. Under current law, VA 
follows a formula defined in statute to decide whether to 
acquire a property or pay off the loan guarantee instead. The 
formula requires appraisals that may be valid at the time they 
are made, but do not account for changes in market conditions 
that may occur while VA prepares to dispose of the property. 
This provision would require VA to take account of losses from 
changes in housing prices that the appraisal does not capture. 
Losses of this type might be prevalent when housing prices are 
particularly turbulent or if appraisals were biased for other 
reasons.
    Since 1978, VA has suffered a resale loss every year except 
1993 and 1994. Recent losses average about $2,500 per home. 
Assuming that this provision applies to between 1,500 and 2,000 
homes a year, CBO estimates that this provision would save 
about $4 million a year.
    Payment and benefit withholding (section 11025).--This 
provision would permit VA to collect certain loan guarantee 
debts by reducing any Federal salary or Federal income tax 
return refund otherwise due to a veteran or surviving spouse. 
Under current law before VA could use these means either it 
would have to obtain the written consent of the debtor or the 
debt would have to be due to a court determination. Based on 
information from VA, CBO estimates that this provision would 
raise collections by $90 million from a stock of loans that 
originated several years ago. There would be no effect after 
1996 because this amendment does not apply to debts from the 
housing program as it is now defined in law.

                       TABLE 4.--BUDGETARY IMPACT OF PROPOSED CHANGES TO VETERANS HOUSING                       
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                            1995     1996     1997     1998     1999     2000     2001     2002 
----------------------------------------------------------------------------------------------------------------
                                                                                                                
             Direct spending                                                                                    
                                                                                                                
Spending under current law:                                                                                     
    Estimated budget authority..........       22       34       61       78      230      251      274      299
    Estimated outlays...................      151       65       49       49      169       60       21        8
Proposed changes:                                                                                               
    Estimated budget authority..........        0      -95        0        0     -147     -150     -150     -150
    Estimated outlays...................        0      -95        0        0     -147     -150     -150     -150
Spending under proposals:                                                                                       
    Estimated budget authority..........       22      -61       61       78       83      101      124      149
    Estimated outlays...................      151      -30       49       49       22      -90     -129     -142
----------------------------------------------------------------------------------------------------------------

    Enhanced loan asset sale authority (section 11024).--This 
section would extend through September 30, 1996, the authority 
of the Secretary of Veterans Affairs to guarantee the real 
estate mortgage investment conduits [REMIC's] that are used to 
market vendee loans. Vendee loans are issued to the buyers of 
properties that VA acquired through foreclosures. VA then sells 
these loans on the secondary mortgage market using REMIC's. By 
guaranteeing the certificates issued on a pool of loans VA 
obtains a better price but also assumes risk.
    CBO estimates that this provision would save about $5 
million 1996 based on sales of $1.3 billion. If this provision 
were not enacted VA could market vendee loans under other 
provisions of law. Nevertheless, this provision would permit VA 
to realize a better price for a package of vendee loans than if 
it used a REMIC program of the Government National Mortgage 
Association. Data indicate that this provision would raise 
receipts by about 0.4 percent of sales.

                   amounts subject to appropriations

    Subtitle C, Health Care Eligibility Reform, contains 
provisions that would increase the cost of veterans medical 
care by $3 billion or more annually, assuming appropriation of 
the necessary amounts. Total spending for veterans medical 
care, however, would continue to be limited by amounts provided 
in annual appropriations acts.
    The costs of this subtitle would stem primarily from 
changes that would make more veterans eligible for outpatient 
care, but provisions to extend medical care to certain Persian 
Gulf veterans and to expand eligibility for prosthetics would 
also lead to significant costs.
    Eligibility for medical care.--Currently, about 10.5 
million veterans are only eligible for outpatient care to the 
extent that it obviates the need for inpatient care or if it 
was a pre- or post-hospitalization visit. This bill would 
remove the restrictions and would enable VA to treat these 
veterans on an outpatient basis. As a result, a substantial 
number of veterans who have been denied access to outpatient 
clinics could demand care.
    The budgetary impact of this provision has two parts--
savings from shifting the current workload from unauthorized 
inpatient care to outpatient care, and costs from the induced 
demand for outpatient care. Anecdotal evidence suggests that 
some VA hospitals admit some of these veterans as inpatients to 
circumvent the restrictions on outpatient care. VA estimates 
suggest that shifting the currently unauthorized inpatient 
workload to less costly outpatient workload would save about 
$214 million annually. CBO estimates that the costs of the 
induced demand would far outweigh the savings.
    These costs are difficult to estimate but would probably 
amount to billions of dollars each year. Costs would rise by 
about $3 billion a year if the greater demand for outpatient 
care came only from that group of veterans who now receive 
inpatient care from VA, but not outpatient care. This care 
would be provided for the nonservice-connected ailments 
primarily of veterans who have no service-connected 
disabilities and have low enough incomes, and of veterans with 
service-connected disabilities rated less than 50 percent.
    The estimate assumes that veterans who now come to VA for 
inpatient care are most inclined to come to it for outpatient 
care. About 3.4 million veterans who now use VA only for care 
related to hospital admissions would use it also for other 
outpatient care under the bill. About 1.3 million of these 
veterans already use VA for some outpatient care--presumably 
related to their hospital admissions, reducing the number of 
new users attributable to the bill to around 2.1 million 
veterans. Because about 52 percent of all veterans need 
outpatient care during a year, CBO estimates that 1.1 million 
veterans would come to VA each year for outpatient care because 
of this bill. The estimated workload was based on published 
counts of veterans and data from the 1992 Survey of Veterans 
that indicate what percent of each group came to VA for 
inpatient and outpatient care.
    The costs of this outpatient care would amount to about $3 
billion a year based on the number of visits per patient and 
VA's average cost per visit--about $200. Costs for this group 
would be even higher, by billions of dollars perhaps, if these 
outpatient visits led to even more inpatient admissions. Costs 
would be higher still if veterans who do not use the system at 
all are drawn to VA for medical care. Thus, costs would 
probably exceed $3 billion a year.
    Sharing agreements with the Department of Defense.--The 
bill would allow VA and the Department of Defense [DOD] to 
continue indefinitely to treat patients eligible for each 
other's programs. Because the current agreement covers a 
relatively small number of beneficiaries, this provision by 
itself would probably not lead to significant costs. But 
sharing agreements could ultimately make it easier to treat the 
greater number of outpatients described above as well as other 
eligible veterans who do not use their benefits now.
    Care for Persian Gulf veterans.--The bill would extend from 
December 31, 1995, to December 31, 1998, VA's authority to 
provide medical treatment to veterans who may have been exposed 
to toxic substances while serving in the Persian Gulf war. 
Since 1992, about 180,000 veterans have sought outpatient care 
for ailments believed to have resulted from exposure to toxic 
substances while serving in the gulf war. Forty-eight thousand 
gulf war veterans are on VA's registry, and registrations 
continue at the rate of 2,000-2,500 per month during fiscal 
year 1995. Based on estimates from VA, the cost of treating and 
testing these veterans would be $80 million per year through 
1998. The cost for the final 9 months of fiscal year 1996 would 
be $60 million.
    Prosthetics.--VA currently furnishes prosthetic devices--
including artificial limbs, braces, orthotics, eye glasses, 
hearing aids, and wheel chairs--to veterans, but only as part 
of their inpatient care. This provision would revise current 
law by making prosthetics available on an outpatient or 
ambulatory care basis and would direct VA to issue new 
regulations to reflect this expanded access within 30 days.
    This provision would increase the demand the prosthetics 
and other aids and--depending on regulations issued by VA--
could result in substantial costs. The veteran population is 
aging--40 percent are now near 65 years old, and according to 
VA projections, the veteran population 65 and older will 
increase to 9.3 million by 2000, from 8.3 million in 1993. The 
number of veterans over 85 projected to increase by about 600 
percent, reaching about 1.3 million, by 2010. According to a 
1993 study by the National Council on Disability, the 
prevalence of limitations in seeing, hearing, and moving 
increase in age; moreover, the incidence and severity of 
disability increases with age. Thus, the age of the veteran 
population, the needs of the elderly, and the expanded access 
to outpatient care under this bill would lead to significant 
costs for this provision.
    Other provisions.--The bill contains other provisions 
related to the management of veterans health care programs, 
sharing agreements for specialized medical resources, and 
personnel furnishing shared resources. None of these provision 
would have a significant budgetary impact.
    6. Estimated cost to the State and local governments: For 
1999 through 2002, section 11014 would limit pensions to $90 a 
month for veterans and their survivors who are in nursing homes 
and who receive Medicaid. It would also allow these 
beneficiaries to retain their pension instead of having to use 
it to defray nursing home costs; thus, Federal and State 
Medicaid costs would increase. State governments would face 
higher costs that would amount to about $200 million a year--
the same net amount that would be saved by the Federal 
Government as a result of this bill. Under the reconciliation 
recommendations of the House Committee on Commerce, the 
Medicaid Program established by title XIX of the Social 
Security Act would be replaced by a new program of block grants 
to States under title XXI.
    7. Estimate comparison: None.
    8. Previous CBO estimate: None.
    9. Estimate prepared by: Victoria Fraider, Michael, 
Groarke, and Mary Helen Petrus.
    10. Estimate approved by: Paul N. Van de Water, Assistant 
Director for Budget Analysis.

                      Committee Oversight Findings

    The committee's oversight findings are generally contained 
in the Purpose and Background portion of the reconciliation 
recommendations. The relevant oversight activities of the 
committee have included the following:
    On February 24, 1995, the committee held a hearing on the 
administration's fiscal year 1996 budget and its deficit 
reduction proposals;
    On April 6, 1995, the Subcommittee on Hospitals and Health 
Care of the committee held a hearing on the reorganization of 
the Veterans Health Administration;
    On July 19, 1995, the committee held a hearing on health 
care eligibility reform; and
    On August 2, 1995, the Subcommittee on Education, Training, 
Employment and Housing of the committee held a hearing on draft 
legislation which included the VA's enhanced loan asset sale 
authority.

 Oversight Findings of the Committee on Government Reform and Oversight

    No oversight findings have been submitted to the committee 
by the Committee on Government Reform and Oversight.
                            TITLE XII--TRADE

                          House of Representatives,
                               Committee on Ways and Means,
                                Washington, DC, September 28, 1995.
Hon. John R. Kasich,
Chairman, Committee on the Budget,
Washington, DC.
    Dear Mr. Chairman: On September 21, 1995, the Committee on 
Ways and Means considered budget reconciliation recommendations 
on trade adjustment assistance, and pursuant to House 
Congressional Resolution 67, the concurrent resolution on the 
budget for fiscal 1996, ordered them favorably reported, as 
amended, to the Committee on Budget by voice vote. Accordingly, 
I am now transmitting the committee's recommendations to you.
    Enclosed are the legislative language, explanatory report 
language, and the Congressional Budget Office cost estimate for 
the committee. Under separate covers, I have transmitted the 
committee's recommendations on revenue and trade items.
    Please feel free to contact me or Phil Moseley if you have 
any questions. With best personal regards.
            Sincerely,
                                               Bill Archer,
                                                          Chairman.
    Enclosures.
  
                           table of contents
                                                                   Page
Transmittal letter...............................................   929
Reconciliation recommendations Trade Title.......................   929
    I. Subtitle A--Technical corrections and miscellaneous trade.   929
    II. Subtitle B--Generalized system of preferences............   942
    III. Subtitle C--Trade Adjustment Assistance.................   955
Changes in existing law..........................................   957
Vote of the committee............................................  1001
Committee consideration..........................................  1001
Congressional Budget Office estimate.............................  1003
Committee oversight findings.....................................  1008
Committee on Government Reform and Oversight findings............  1008
Inflationary impact statement....................................  1008

               Reconciliation Recommendations Trade Title

 I. Subtitle A--Technical Corrections and Miscellaneous Trade Proposals

                            a. introduction

                        1. Purposes and summary

    During the 103d Congress, two major pieces of trade 
legislation were passed: H.R. 3450, the North American Free 
Trade Implementation Act (Public Law 103-182) and H.R. 5110, 
the Uruguay Round Agreements Act (Public Law 103-465). The 
committee reviewed the need for several technical and 
conforming changes as a result of the enactment of major trade 
legislation and prior committee and subcommittee action.

                 2. Background and need for legislation

    The recommendations would make technical corrections to 
various U.S. trade laws and includes other miscellaneous trade 
provisions. Identical provisions were reported favorably out of 
the Subcommittee on Trade in two separate packages on June 14 
and August 2, 1995. It should be noted that a number of 
additional proposals that were not ready for consideration at 
this time have been suggested to the committee. These proposals 
remain under review by committee staff and the administration 
and may be considered at a later date.

                         3. Legislative history

    On May 17, 1994, the House passed H.R. 3419, the Tax 
Simplification and Technical Corrections Act, making technical 
corrections to the tax and trade laws. The Senate did not act 
on the bill.
    The committee approved a set of technical amendments for 
inclusion in the Uruguay Round Agreements Act, but they were 
not included in the final version of the bill submitted by the 
President.
    On April 25, 1995, Trade Subcommittee Chairman Crane 
requested written comments from parties interested in technical 
corrections to recent trade legislation. The Committee on Ways 
and Means received many comments and proposals from the private 
sector and the administration. On June 15 and August 3, 1995 
the Subcommittee on Trade ordered favorably reported draft 
legislation making technical corrections and certain other 
changes to trade laws.
     On July 11, 1995, the subcommittee held a hearing on rules 
of origin. The focus of the hearing was to review the 
administration of U.S. law for preferential and nonpreferential 
rules of origin and the prospects for the ongoing WTO working 
program. Requests for exemptions from country of origin marking 
requirements for certain imports were included as part of the 
record of this hearing.
    On June 14 and August 2, 1995, the subcommittee ordered 
favorably reported by voice vote two draft bills that make 
technical corrections to various U.S. laws and other 
miscellaneous trade provisions.
     On September 13, 1995, the Committee on Ways and Means 
ordered favorably reported to the House Committee on the Budget 
the technical corrections and miscellaneous trade provisions in 
these two draft bills as subtitle A of the trade title of 
recommendations for inclusion in budget reconciliation 
legislation.

  B. SECTION-BY-SECTION SUMMARY OF THE PROVISIONS RECOMMENDED BY THE 
COMMITTEE ON WAYS AND MEANS, JUSTIFICATION, AND COMPARISON WITH PRESENT 
                                  LAW

                   Sec. 1. Payment of duties and fees

    Present law.--Section 505(c) of the Tariff Act of 1930, as 
amended by section 642 of the North American Free Trade 
Agreement [NAFTA] Implementation Act--which includes the 
Customs Modernization Act--provides for interest accrual on 
entries from the date of deposit to the date of liquidation or 
reliquidation. Under this authority, interest is collected or 
refunded, as appropriate. Section 642 of the NAFTA Act--Customs 
Modernization Act--became effective on the date of enactment, 
December 8, 1993.
    Explanation of provision.--The recommendation amends 
section 505(c) of the Tariff Act of 1930 to provide an 
exemption for interest accrual on duty paid or owed where an 
entry is liquidated or reliquidated due to an importer's claim 
for preferential tariff treatment under the NAFTA Act.
    Reason for change.--The underlying purpose for the interest 
accrual provision under section 642 of the NAFTA Act was to 
encourage importers to use reasonable care in determining duty 
liability on making an entry. This rationale does not apply in 
a case where an importer has up to a year after the entry to 
make a claim for preferential tariff treatment under NAFTA. 
Otherwise, an importer would be assured a guaranteed return on 
funds by routinely delaying a claim for NAFTA treatment and 
thereby receiving a refund of duties with interest. The 
application of the interest provision in this way was not 
contemplated at the time of its adoption. This change is needed 
to conform with the committee's original intent.
    Effective date.--This section is effective for NAFTA claims 
made on or after April 25, 1995, the date of the subcommittee 
press release announcing consideration of this change.

           Sec. 2. Other technical and conforming amendments

(a) Examination of books and witnesses

    Present law.--Section 509(a) of the Tariff Act of 1930 
provides the U.S. Customs Service the authority to examine 
books and summon witnesses in its investigations and inquiries.
    Explanation of provision.--The recommendation amends 
section 509(a)(2) of the Tariff Act of 1930 to make a technical 
correction to the citation ``subsection (c)(1)(A)'' to 
``subsection (d)(1)(A).''
    Reason for change.--This correction revises an incorrect 
citation.
    Effective date.--December 8, 1993.

(b) Requirement for certificate for importation of alcoholic liquors in 
        small vessels

    Present law.--Section 7 of the act of August 5, 1935, 
requires certificates of importation for alcoholic beverages on 
small vessels.
    Explanation of provision.--The recommendation repeals 
section 7 of the act of August 5, 1935.
    Reason for change.--Section 7 is an obsolete statute.
    Effective date.--December 8, 1993.

(c) Manifests

    Present law.--Section 431 of the Tariff Act of 1930 
provides requirements for vessel manifests including rules 
governing their form and content.
    Explanation of provision.--The recommendation amends 
section 431(c)(1) of the Tariff Act of 1930 to clarify that the 
reference is to vessel manifests and does not include other 
types of manifests.
    Reason for change.--This technical correction eliminates 
confusion concerning the reference in subsection (c) to a 
manifest described differently in subsections (a) and (b).
    Effective date.--December 8, 1993.

(d) Documentation for entry of merchandise

    Present law.--Section 484(a)(1) of the Tariff Act of 1930 
provides requirements for the entry of merchandise.
    Explanation of provision.--The recommendation amends 
section 484(a)(1) of the Tariff Act of 1930 to delete a 
reference to section 336(j).
    Reason for change.--This technical correction deletes an 
obsolete statutory reference.
    Effective date.--December 8, 1993.

(e) Penalties for certain violations

    Present law.--Section 592 of the Tariff Act of 1930 
provides rules for the imposition of penalties for fraud, 
negligence, and gross negligence.
    Explanation of provision.--The recommendation amends 
section 592 to replace references to ``lawful duty'' with 
``lawful duty, tax, or fee.''
    Reason for change.--This technical correction recognizes 
that Customs collects taxes and fees, as well as duties.
    Effective date.--December 8, 1993.

(f) Deprivation of lawful duties, taxes, or fees

    Present law.--Section 592(d) of the Tariff Act of 1930 
provides for the restoration of lawful duties if the U.S. has 
been deprived of such by a violation.
    Explanation of provision.--The recommendation amends 
section 592(d) of the Tariff Act to replace the phrase ``or 
fees be restored'' with ``and fees be restored.''
    Reason for change.--This technical correction ensures the 
restoration of duties, taxes, and fees if the United States was 
deprived of any duties, taxes, or fees by a violation of 
Section 592.
    Effective date.--December 8, 1993.

(g) Reconciliation treated as entry for recordkeeping

    Present law.--Section 401 of the Tariff Act of 1930 
provides miscellaneous definitions and section 508 of that act 
provides the requirements, time periods, and limitations for 
import recordkeeping.
    Explanation of provision.--The recommendation amends 
sections 401(s) and 508(c)(1) of the Tariff Act of 1930 to 
clarify that a reconciliation should be treated as an entry for 
purposes of recordkeeping laws.
    Reason for change.--This change clarifies that records 
pertaining to reconciliation should be retained for a period of 
5 years from the date of filing of the reconciliation, in 
conformance with the general recordkeeping requirement.
    Effective date.--December 8, 1993.

(h) Extension of liquidation

    Present law.--Section 504 of the Tariff Act of 1930 
provides for limitations on the liquidation of entries.
    Explanation of provision.--The recommendation amends 
section 504(d) of the Tariff Act of 1930 to ensure that when a 
suspension of liquidation is removed, the entry is not 
liquidated if an extension has been issued.
    Reason for change.--By operation of law, when a suspension 
of liquidation is removed, Customs must liquidate entries 
within a specified time period. This provision clarifies that 
such liquidation should not occur if an extension has been 
issued.
    Effective date.--December 8, 1993.

(i) Exemption from duty for personal and household goods accompanying 
        returning residents

    Present law.--Section 321(a)(2)(B) of the Tariff Act of 
1930 originally applied to returning residents arriving from 
foreign countries other than the insular possessions. Due to a 
split in tariff classification numbers, the tariff numbers 
applicable to residents returning from a foreign country were 
inadvertently dropped.
    Explanation of provision.--The recommendation amends 
section 321(a)(2)(B) to restore HTS item number 9804.00.65.
    Reason for change.--This amendment corrects the error and 
ensures that U.S. residents returning from foreign countries 
other than the insular possessions are entitled to bring 
articles for personal or household use free of duty if such 
articles are valued at not more than $400.
    Effective date.--December 8, 1993.

(j) Debt collection

    Present law.--Section 631(a) of the Tariff Act of 1930 
provides for the use of private collection agencies to recover 
debts arising under the Customs laws and owed to the U.S. 
Government.
    Explanation of provision.--The recommendation amends 
section 631(a) to clarify that compensation paid to debt 
collection agencies applies to debts owed to Customs.
    Reason for change.--The provision corrects the operation of 
section 631(a). It enables Customs to recover expenses 
associated with collecting debts when the Customs Service 
contracts with private collection agencies for the recovery of 
debts. The provision also allows Customs to pay collection 
agencies from recovered funds prior to depositing these funds 
in the Treasury.
    Effective date.--December 8, 1993.

(k) Examination of books and witnesses

    Present law.--Section 509 of the Tariff Act of 1930 
provides Customs the authority to examine books and summon 
witnesses in its investigations and inquiries.
    Explanation of provision.--The recommendation amends 
section 509(b) of the Tariff Act of 1930 to delete 
``appropriate regional commissioner'' and substitute ``officer 
designated pursuant to regulations.''
    Reason for change.--This technical correction reflects the 
Customs reorganization by replacing an obsolete administrative 
reference.
    Effective date.--December 8, 1993.

(l) Review of protests

    Present law.--Section 515 of the Tariff Act of 1930 
provides for the review of protests, administrative reviews, 
modifications of decisions, and requests for accelerated 
disposition of requests by the district director.
    Explanation of provision.--The recommendation amends 
section 515(d) of the Tariff Act of 1930 to delete ``district 
director'' and substitute ``port director.''
    Reason for change.--This technical correction reflects the 
Customs reorganization by replacing an obsolete administrative 
reference.
    Effective date.--December 8, 1993.

  Sec. 3. Clarification regarding the application of customs user fees

    Present law.--Section 13031(b) of the Consolidated Omnibus 
Budget Reconciliation Act of 1985, as amended by section 111(b) 
of the Customs and Trade Act of 1990 provides that, in the case 
of agricultural products of the United States processed and 
packed in foreign trade zones, the ad valorem merchandise 
processing fee [MPF] applies solely to the value of the foreign 
material used to make the container. It exempts the value of 
domestic agricultural products from the MPF.
    The U.S. Customs Service has ruled that, for all products 
not covered by this provision, and in the absence of an express 
provision to the contrary, the MPF will be assessed on both the 
domestic and foreign value of the merchandise entering from 
foreign trade zones.
    Explanation of provision.--The recommendation amends 
section 13031(b)(8) of the Consolidated Omnibus Reconciliation 
Act of 1985 to clarify that the MPF will be applied only to the 
foreign value of merchandise entered from a foreign trade zone. 
In addition, the provision made by section 111(b)(2)(D)(iv) of 
the Trade Act of 1990 regarding the application of the MPF to 
processed agricultural products will apply to all entries for 
which liquidation has not been finalized from foreign trade 
zones after November 30, 1986.
    Reason for change.--Section 111(b) provides that the MPF is 
applied solely to foreign merchandise entered from a foreign 
trade zone, exempting domestic value, for agricultural 
products. The provision extends this same treatment to 
nonagricultural products.
    Effective date.--These provisions apply to any entry made 
on or after the 15th day after the date of enactment, and to 
any entry made after November 30, 1986, and before such 15th 
day, if the entry liquidation is not finalized before such 15th 
day.

    Sec. 4. Technical amendment to the Customs and Trade Act of 1990

    Present law.--Subsection (b) of section 484H of the Customs 
and Trade Act of 1990 provides for the transportation in bond 
of Canadian lottery material.
    Explanation of provision.--The recommendation amends 
subsection (b) of section 484H of the Customs and Trade Act of 
1990 to replace the phrase ``entered or withdrawn from 
warehouse for consumption'' in the ``Effective Date'' section 
with ``entered for transportation in bond.''
    Reason for change.--This technical correction clarifies 
that Canadian lottery material transported in bond is not 
entered into the United States for consumption.
    Effective date.--Date of enactment.

  Sec. 5. Technical amendments regarding certain beneficiary countries

    Present law.--Section 213(h) of the Caribbean Basin 
Economic Recovery Act (CBERA) provides duty reductions on 
certain handbags, luggage, flat goods, work gloves, and leather 
wearing apparel. Section 204(c)(1) of the Andean Trade 
Preference Act [ATPA] is an identical provision.
    Explanation of provision.--The recommendation amends 
section 213(h)(1) of CBERA and section 204(c)(1) of ATPA to add 
the following language: ``The duty reductions provided for 
under this section shall not apply to textile and apparel 
articles which are subject to textile agreements.''
    Reason for change.--These amendments are needed to clarify 
the committee's intent that the duty reductions under section 
213(h) of CBERA and section 204(c)(1) of ATPA should not apply 
to textile and apparel articles which are subject to textile 
agreements.
    Effective date.--These provisions apply to articles entered 
or withdrawn from warehouse for consumption on or after the 
15th day after the date of enactment, and articles entered 
after December 31, 1991, and before such 15th day, which are 
not liquidated before such 15th day.

       Sec. 6. Clarification of fees for certain customs services

    Present law.--Section 13031(b)(9)(A) of the Consolidated 
Omnibus Budget Reconciliation Act of 1985 [COBRA] authorizes 
the Customs Service to provide reimbursable services to air 
couriers operating in express consignment carrier facilities 
and in centralized hub facilities. Customs interprets the 
statute to mean that they are prevented from providing 
reimbursable services during daytime hours to centralized hub 
facilities.
    Explanation of provision.--The recommendation amends 
section 13031(b)(9)(A) of the COBRA to clarify that Customs may 
provide reimbursable services to centralized hub facilities 
during daytime hours. The provision also clarifies that Customs 
may be reimbursed for all services related to the determination 
to release cargo, and not just inspectional services. These 
services are reimbursable regardless of whether they are 
performed on site or not.
    Reason for change.--This change removes an outdated 
statutory impediment and allows Customs to provide services and 
accept reimbursement during all hours of operation of 
centralized hub facilities.
    Effective date.--Date of enactment.

      Sec. 7. Special rule for extending time for filing drawback 
           clarification of fees for certain customs services

    Present law.--Section 313(r) of the Tariff Act of 1930 
requires that a drawback entry and all documents necessary to 
complete a drawback claim, including those issued by the 
Customs Service, shall be filed or applied for, as applicable, 
within 3 years after the date of exportation or destruction of 
the articles on which drawback is claimed. Customs has no 
discretion to extend the deadline.
    Explanation of provision.--The recommendation amends 
section 313(r) of the Tariff Act of 1930 to permit an extension 
of 1 year from the date of enactment of this bill for filing 
drawback claims in cases where the President has declared a 
major disaster on or after January 1, 1994, and the claimant 
files a request for such extension with the Customs Service 
within 1 year from the date of enactment.
    Reason for change.--As a result of a natural disaster 
declared by the President, such as the most recent major 
California earthquake, businesses may be unable to file timely 
drawback petitions, resulting in significant financial loss. 
Under current law, the Customs Service is unable to extend the 
filing deadline. This provision extends the Customs Service 
filing deadline.
    Effective date.--Date of enactment, with respect to 
disasters on or after January 1, 1994.

                  Sec. 8. Treatment of certain entries

    Present law.--Sections 514 and 520 of the Tariff Act of 
1930 provides for protests against decisions of the Customs 
Service and refunds and errors, respectively.
    Explanation of provision.--The recommendation provides for 
the liquidation or reliquidation of certain entries in 
accordance with an administrative review by the International 
Trade Administration of the Department of Commerce. Any amounts 
owed by the United States pursuant to the liquidation or 
reliquidation of these entries shall be paid within 90 days 
after such liquidation or reliquidation.
    Reason for change.--This technical correction addresses an 
administrative error in which certain liquidation notices were 
not issued by the Customs Service before the expiration period. 
This error was discovered too late for an administrative 
solution.
    Effective date.--Date of enactment.

Sec. 9. Temporary duty suspension for personal effects of participants 
                    in certain world athletic events

    Present law.--Subchapter II of chapter 99 of the Harmonized 
Tariff Schedule [HTS] provides for temporary reductions in 
rates of duty. HTS subheading 9902.98.04 provides for the duty-
free entry of the personal effects, equipment, and other 
materials of participants in, officials of, or accredited 
members of delegations to world athletic events, including the 
XXVI Summer Olympiad and the 1996 Atlanta Paralympic Games.
    Explanation of provision.--The recommendation adds HTS 
subheading 9902.98.05 to provide for the duty-free entry of the 
personal effects, equipment, and other materials to 
participants in, officials of, or accredited members of 
delegations to the 1998 Goodwill Games.
    Reason for change.--The provision grants a temporary 
suspension of duty on the personal effects of participants in, 
and certain other individuals associated with, the 1998 
Goodwill Games until February 1, 1999, consistent with such 
treatment for personal effects of participants in similar world 
athletic events.
    Effective date.--Date of enactment.

              Sec. 10. Miscellaneous technical corrections

(a) Drawback and refunds

    Present law.--Section 313(s)(2)(B) of the Tariff Act of 
1930 (19 U.S.C. 1313(s)(2)(B)) provides that a drawback 
successor may designate imported merchandise or certain other 
merchandise for which the successor received, before the date 
of succession, from the person who imported and paid duty on 
the imported merchandise, a certificate of delivery 
transferring the merchandise to the successor.
    Explanation of provision.--The recommendation amends 
section 313(s)(2)(B) of the Tariff Act of 1930 (19 U.S.C. 
1313(s)(2)(B)) by changing the first use of the word 
``successor'' to ``predecessor.''
    Reason for change.--This technical correction eliminates 
confusion stemming from incorrect wording.
    Effective date.--Date of enactment.

(b) Trade Act of 1974

    Present law.--Section 301(c)(4) of the Trade Act of 1974 
(19 U.S.C. 2411(c)(4)) provides the scope of authority for the 
United States Trade Representative to carry out mandatory and 
discretionary trade actions under section 301 of the Trade Act 
of 1974.
    Explanation of provision.--The recommendation amends 
section 301(c)(4) of the Trade Act of 1974 (19 U.S.C. 
2411(c)(4)) to make a technical correction to a citation.
    Reason for change.--This technical correction eliminates 
confusion stemming from an incorrect citation.
    Effective date.--Date of enactment.

                 Sec. 11. Uruguay Round Agreements Act

    Present law.--Section 405(b) of the Uruguay Round 
Agreements Act (19 U.S.C. 3602(b)) provides the authority for 
the President to impose a duty with respect to a special 
safeguard agricultural good.
    Explanation of provision.--The recommendation amends 
section 405(b) of the Uruguay Round Agreements Act (19 U.S.C. 
3602(b)) to make a technical correction to a citation.
    Reason for change.--This technical correction eliminates 
confusion stemming from an incorrect citation.
    Effective date.--Date of enactment.

       Sec. 12. Filing of certifications for civil aircraft parts

    Present law.--General note 6 of the HTS of the United 
States provides guidelines for articles eligible for duty-free 
treatment pursuant to the Agreement on Trade in Civil Aircraft.
    Explanation of provision.--The recommendation amends 
general note 6 of the HTS to allow for the electronic filing of 
civil aircraft parts certifications.
    Reason for change.--The Customs Modernization Act provided 
for the electronic filing of Customs transactions. It did not 
specifically authorize the electronic filing of certifications 
for civil aircraft parts as covered by general note 6 of the 
HTS. This conforming change provides importers with the option 
of filing certifications electronically. It will increase the 
operating efficiency of both the Customs Service and the 
business community.
    Effective date.--Date of enactment.

          Sec. 13. Exemption regarding certain vessel repairs

    Present law.--Section 484E(b)(2)(B) of the Customs and 
Trade Act of 1990 (19 U.S.C. 1466 note) provides a temporary 
exemption from duties imposed on the foreign repair of vessels.
    Explanation of provision.--The recommendation amends 
section 484E(b)(2)(B) of the Customs and Trade Act of 1990 (19 
U.S.C. 1466 note) by extending the temporary exemption for 
those entries made after December 31, 1992 and before January 
1, 1995.
    Reason for change.--The exemption under section 484E(b) of 
the Customs and Trade Act of 1990 for certain U.S. vessel 
repairs performed overseas expired at the end of 1992, in 
anticipation of the completion of the Uruguay round, and was 
reinstated on a prospective basis in the Uruguay Round 
Agreements Act. This provision fills a gap in the coverage of 
the previously expired exemption.
    Effective date.--The amendment made by this section applies 
to entries made after December 31, 1992, and before January 1, 
1995.

               Sec. 14. Fees for certain customs services

    Present law.--Section 13031(b) of the Consolidated Omnibus 
Budget Reconciliation Act [COBRA] of 1985 (19 U.S.C. 58c(b)) 
provides for limitations on the collection of fees for Customs 
services. Section 521 of the North American Free Trade 
Agreement [NAFTA] Implementation Act (19 U.S.C. 58c(a)(5)) 
increased the Customs COBRA passenger processing fee from $5 to 
$6.50, and temporarily (from 1/1/94 to 9/30/97) lifted the 
exemption on passengers arriving from Canada, Mexico, and the 
Caribbean. The statutory language was also modified to apply 
the fee to so-called cruises to nowhere.
    Explanation of provision.--The recommendation amends 
section 13031(b) of the Consolidated Omnibus Budget 
Reconciliation Act of 1985 (19 U.S.C. 58c(b)) to clarify the 
application of section 521 of NAFTA to provide for the 
collection of fees only one time in the course of a single 
voyage for a passenger aboard a commercial vessel.
    Reason for change.--Prior to NAFTA, the COBRA fee applied 
to passenger arrivals from a place outside the United States. 
In order to cover so-called cruises to nowhere (cruises which 
simply go out of the customs territory and return, without 
calling on any port outside the United States), the statute was 
amended to apply to the arrival of passengers from outside the 
customs territory.
    However, the Customs Service has adopted a legal opinion 
that would require the collection of the fee multiple times 
from cruise passengers on a single continuous voyage that 
touches at more than one U.S. port. This interpretation was 
never intended by the committee. This technical correction 
clarifies the original intent that no multiple collections be 
made.
    Effective date.--The amendments made by this section take 
effect as if included in the amendments made by section 521 of 
the North American Free Trade Agreement Implementation Act.

    Sec. 15. Technical corrections to certain chemical descriptions

    Present law.--Subheading 2933.90.02 of the Harmonized 
Tariff Schedule of the United States provides for the entry of 
heterocyclic compounds with nitrogen hetero-atom(s) only, and 
nucleic acids and their salts.
    Explanation of provision.--The recommendation amends 
subheading 2933.90.02 of the Harmonized Tariff Schedule of the 
United States to strike Quizalofop ethyl.
    Reason for change.--One of the chemical products in this 
subheading, 2- [4- [ (6-Chloro-2-quinoxalinyl)-oxy-phenoxyl-
propionic acid, ethyl ester, is an agricultural herbicide for 
which a temporary suspension was established in 1990, as HTSUS 
9902.30.58. The Uruguay round implementing legislation made 
this temporary suspension permanent under 2933.90.02.
    The subject herbicide exists physically as two 
stereoisomers, or compounds with identical chemical formulas 
and atomic connectivity but with different spatial orientations 
of particular atoms or atomic groups. By striking Quizalofop 
ethyl, this provision clarifies that this HTS category covers 
all stereoisomers of this chemical product and not just one 
particular form of the product imported at the time of 
enactment of the Uruguay Round Agreements Act.
    Effective date.--In general, the effective date of this 
section is the 15th day on or after the date of enactment of 
this section. The section also has a retroactive provision 
which provides for the liquidation or reliquidation of any 
entry under subheading 2933.90.02 made after December 31, 1994 
and before the date 15 days after the date of enactment of this 
section.

          Sec. 16. Marking of imported articles and containers

    Present law.--Section 304 of the Tariff Act of 1930 (19 
U.S.C. 1304) requires that every article of foreign origin 
imported into the United States, or its container, be marked 
with the country of origin of the article.
    Explanation of provision.--The recommendation amends 
section 304 of the Tariff Act of 1930 (19 U.S.C. 1304)) to 
exempt certain metal forgings for hand tools, coffee products, 
teas, and spices from country of origin marking requirements.
    Reason for change.--During hearings on the administration 
of rules of origin, the Trade Subcommittee became aware of 
instances where the interpretation of the current marking 
requirements was incompatible with commercial realities and 
manufacturing processes. With respect to certain metal forgings 
for hand tools, the Customs Service revoked longstanding 
administrative rulings which held that, when imported forgings 
undergo significant processing in the United States which 
changes the name, character, or use of the articles, thereby 
achieving a substantial transformation, the completed tools are 
not deemed to be the product of the country where the forgings 
were made and need not be marked. By revoking this approach, 
articles which undergo significant processing in the United 
States, such as machining operations which contribute 
significant value added to an article, are nonetheless found to 
be of foreign origin. By exempting these articles from the 
marking requirement, the committee corrects this inequity and 
brings the law in line with commercial reality.
    With respect to coffee products, teas, and spices, the 
provision also conforms marking requirements with commercial 
reality. Since these products are blended from numerous 
imported sources, producers would be forced to constantly 
change labels to reflect import sources as each batch of 
product is labeled. The current marking requirement imposes 
substantial additional costs, while yielding information of 
little benefit to consumers.
    Effective date.--Date of enactment.

   Sec. 17. Liquidation or reliquidation of a certain entry of warp 
              knitting machines as free of certain duties

    Present law.--Section 514 of the Tariff Act of 1930 (19 
U.S.C. 1514), as amended outlines rules for protest against 
decisions of the Customs Service.
    Explanation of provision.--The provision provides redress 
for an acknowledged Customs Service mistake concerning duties 
levied on the importation of certain warp knitting machines. In 
the fall of 1988, D&S International, an import-export business 
in Burlington, NC, imported four German-made warp knitting 
machines under a nondutiable HTS number. D&S subsequently sold 
the machines to a Venezuelan company which, finding the 
machines unsatisfactory, returned them to D&S. Upon reentry at 
Charleston, SC, the Customs Service mistakenly classified the 
machinery under a different HTS number at a duty of 4.4 
percent. While D&S conveyed its protest to Customs in a timely 
manner, the company initially used the wrong Customs form. 
Before D&S could resubmit their protest on the correct forms, 
the 90-day deadline for filing protests passed. Eventually, D&S 
owed $28,000, plus interest.
    Reason for change.--The provision instructs the Customs 
Service to treat the reentry of a single entry of four warp 
knitting machines from Venezuela as a duty-free entry, and to 
refund any duties and interest which the American company has 
paid as a result of the improper classification.
    Effective date.--Date of enactment.

                   Sec. 18. Miscellaneous provisions

                            A. INTRODUCTION

                 1. Background and need for legislation

    Section 310 of the Trade Act of 1974, as amended by the 
Omnibus Trade and Competitiveness Act of 1988, required the 
USTR, within 30 days after the National Trade Estimates Report 
on foreign trade barriers is due, to identify trade 
liberalization priorities and to initiate section 301 
investigations on priority practices for each priority foreign 
country. On March 3, 1994, President Clinton issued Executive 
Order 12901 which extended this procedure in a revised form 
through 1994. The Uruguay Round Agreements Act contained 
language extending this revised Super 301 procedure by statute 
for the year 1995.

                         2. Purpose and summary

    Section 18 would extend Super 301 through the year 2000 
because the committee believes it would be a mistake to let 
this trade policy tool expire.

                         3. Legislative history

    The committee passed an amendment--voice vote, offered by 
Messrs. Levin and Houghton, adding section 18 to the chairman's 
reconciliation recommendations, which would extend Super 301 in 
its revised form, through the year 2000.

  B. SECTION-BY-SECTION SUMMARY OF THE PROVISIONS RECOMMENDED BY THE 
COMMITTEE ON WAYS AND MEANS, JUSTIFICATION, AND COMPARISON WITH PRESENT 
                                  LAW

    Present law.--Section 310 of the Trade Act of 1974, as 
amended by the Omnibus Trade and Competitiveness Act of 1988, 
required the USTR, within 30 days after the National Trade 
Estimates Report on foreign trade barriers was due in 1989 and 
1990, to identify trade liberalization priorities and to 
initiate section 301 investigations on priority practices for 
each priority foreign country. On March 3, 1994, President 
Clinton issued Executive Order 12901 which extended this 
procedure in a revised form for 1994 and 1995. The Uruguay 
Round Agreements Act amended section 310 to extend this revised 
Super 301 procedure for the year 1995.
    Under current Super 301, the USTR reviews trade expansion 
priorities and identifies priority foreign practices, the 
elimination of which is likely to have the most significant 
potential to increase U.S. exports. USTR must initiate section 
310 investigations on all priority practices within 21 days of 
reporting to congressional committees and seek to negotiate 
agreements for elimination of the practices.
    The report may also include a description of practices that 
may in the future warrant identification as priority foreign 
country practices, as well as a statement about other practices 
that were not identified because they are already being 
addressed by provisions of U.S. trade law, existing bilateral 
trade agreements, or in trade negotiations, and progress is 
being made toward their elimination. The normal section 301 
authorities, procedures and time limits, and other requirements 
apply to investigations carried out under this section.
    Explanation of provision.--Section 18 would extend Super 
301 in its revised form, through the year 2000.
    Reason for change.--The committee believes that it would be 
a mistake to let Super 301 expire this year. The Super 301 
process is an important tool in U.S. trade policy to achieve 
expanded useful opportunities for U.S. goods and services in 
foreign markets through the elimination of foreign trade 
barriers and unfair trade practices. The threat of Super 301 
provides important and effective leverage with foreign 
countries and has worked successfully to obtain agreements with 
several countries on priority trade practices affecting U.S. 
exports in major product sectors.
    Super 301 has actually been applied with respect to 
countries as diverse as Japan, Brazil, and India, and the 
threat of Super 301 has opened markets in an even broader range 
of countries. In 1994, for example, Super 301 was useful in 
beginning to open Japan's telecommunications, medical products, 
insurance, flat glass, and automotive markets.

           II. Subtitle B--Generalized System of Preferences

                            A. INTRODUCTION

                        1. Purposes and summary

    Title V of the Trade Act of 1974 grants authority to the 
President to provide duty-free treatment on imports of eligible 
articles from designated beneficiary developing countries and 
territories, subject to certain conditions and limitations. 
This authority expired on July 31, 1995.
    Title V specifies criteria for determining GSP country and 
product eligibility and limitations on the extension of GSP 
treatment. The program was implemented on January 1, 1976 under 
Executive Order 11888. Relatively minor amendments were made 
under the Tax Reform Act of 1976 and the Trade Agreements Act 
of 1979. The program has been extended several times. Title V 
of the Trade Act of 1984 renewed the GSP program until July 4, 
1993, with significant amendments effective on January 4, 1985, 
particularly in the criteria for designating beneficiary 
countries and limitations on duty-free treatment. The program 
was extended for 15 months, until September 30, 1994 by the 
Omnibus Budget Reconciliation Act of 1993, and further extended 
for 10 months by the Uruguay Round Agreements Act.
    The GSP program provides unilateral, nonreciprocal duty-
free treatment to about 4,500 articles from 148 beneficiary 
developing countries and territories to assist their economic 
development and increase diversification of their economies 
through preferential market access. The Ways and Means 
Committee believes that this program, with the modest reforms 
provided for in the recommendations, will continue to further 
three major policy goals: First, to foster economic development 
in developing countries through increased trade rather than 
foreign aid; second, to promote U.S. trade interests by 
encouraging beneficiaries to open their markets and comply more 
fully with international trading rules; and third, to help 
maintain U.S. international competitiveness by lowering costs 
for U.S. business, as well as lowering prices for American 
consumers.

                 2. Background and need for legislation

    The concept of the GSP program was first proposed in 1964 
at the United Nations Conference on Trade and Development 
[UNCTAD]. Developing countries maintained that one of the major 
impediments to their economic growth and development was their 
inability to compete on an equal basis with developed countries 
in the international trading system. In 1968, the United States 
joined other industrialized countries in supporting the concept 
of GSP.
    GSP is a unilateral grant of duty-free treatment; 
developing countries are not required to extend reciprocal 
tariff reductions, but the statute does set forth certain 
conditions for designation of beneficiary status. The 
preferential and unilateral aspects of GSP are an exception to 
the most-favored-nation and nondiscrimination principles of the 
General Agreement on Tariffs and Trade [GATT] and the World 
Trade Organization. In order to implement their GSP systems, 
the developed countries had to obtain a waiver of these 
principles of the GATT. A 10-year MFN waiver was granted in 
June 1971 which provided that GSP schemes must be generalized, 
nondiscriminatory and nonreciprocal. This waiver was extended 
on a permanent basis in the 1979 GATT Tokyo Round Agreements, 
and was approved by Congress in the context of the Trade 
Agreements Act of 1979 (Public Law 96-39).
    On July 20, 1994 the Ways and Means Committee informally 
approved a number of relatively minor changes to the GSP 
statute which were proposed by the administration with the aim 
of simplifying and improving an extended program for inclusion 
in the Uruguay Round Agreements Act. However, the Uruguay Round 
Agreements Act (Public Law 103-465) submitted by the President 
for congressional approval under fast track procedures did not 
include these reforms and simply reauthorized the current GSP 
statute, without change, for 10 months until July 31, 1995.

                         3. Legislative history

    On February 27, 1995, the Subcommittee on Trade held a 
public hearing on extending GSP. The subcommittee received 
testimony in support of extending GSP from the administration 
and from companies and associations representing exporter, 
importer, economic development, and consumer interests.
    H.R. 1654, ``The GSP Renewal Act of 1995'' was introduced 
on May 17, 1995, by Mr. Crane and Mr. Rangel. On May 18, the 
Subcommittee on Trade considered H.R. 1654 in markup session 
and ordered the bill favorably reported, by a recorded vote 
(13-to-0), to the full Committee on Ways and Means, without 
amendment. The administration testified in support of the bill.
    On September 13, 1995 the full committee considered the 
text of H.R. 1654, as amended, as subtitle B of the Trade Title 
of Chairman Archer's recommendations for inclusion in the 
budget reconciliation legislation. The full committee ordered 
favorably reported the text of the recommendations, to the 
Committee on the Budget, with four amendments, by voice vote.

 B. SUMMARY OF THE PROVISIONS RECOMMENDED BY THE COMMITTEE ON WAYS AND 
                                 MEANS

    The reconciliation recommendations, as amended, would 
reauthorize the Generalized System of Preferences Program for 
2\1/2\ years through December 31, 1997. So that there will be 
no gap in duty-free treatment provided under the GSP program, 
the recommendations would provide for refunds upon request of 
any duty paid between July 31, 1995, and date of enactment.
    In general, the recommendations would make modest reforms 
and technical changes to title V of the Trade Act of 1974, 
which are intended to simplify and improve the administration 
of the GSP program. For example, the recommendations would 
codify a 3-year rule whereby specific products may only be 
considered for addition to the GSP Program every third year, 
following formal consideration and denial of that article. The 
recommendations would exclude high-income countries from GSP 
and would have the effect of reducing the per capita gross 
national product [GNP] limit from $11,800 to $8,600, a number 
which would be indexed. Beneficiary countries that exceed the 
per capita GNP limit must be removed from the GSP Program. The 
President would be required to request public comment before 
graduating a country from eligibility, except in exceptional 
circumstances.
    The recommendations also contain new authority, which was 
requested by the administration, to designate any article from 
a least developed developing country [LDDC], if the President 
determines that the article is not import sensitive in the 
context of imports from LDDC's. This authority does not apply 
to statutorily exempt articles such as textiles and footwear. 
Watches would no longer be on the list of products excluded 
from eligibility under the program.
    The recommendations would reduce the competitive need limit 
[CNL] in the expired law from about $108 million to $75 
million, to be increased by $5 million annually, but would 
retain the competitive need waiver authority. A beneficiary 
country that exceeds the CNL on a particular product would lose 
GSP on that product, but under certain circumstances the 
President could waive the CNL and restore the product to GSP 
for that country. Subtitle B would also set the de minimus 
waiver level at $13 million which will be increased by $500,000 
annually under a new indexing formula.
    Finally, the recommendations would update discretionary 
criteria for GSP eligibility to clarify that adequate and 
effective protection of intellectual property rights may not be 
provided, even if the beneficiary country is complying with the 
Uruguay Round Agreement Act on trade related intellectual 
property rights. In determining whether to designate a country 
for GSP eligibility, the President would be required to 
consider the extent to which a country is cooperating in 
preventing both the proliferation of nuclear weapons and 
illegal drug trafficking.

  c. section-by-section summary of the provisions recommended by the 
committee on ways and means, justification, and comparison with present 
                                  law

                          Sec. 21. Short title

    Explanation of provision.--Section  21 of the 
reconciliation recommendations provide that the Act may be 
cited as the ``Generalized System of Preferences Renewal Act of 
1995.''

               Sec. 22. Generalized system of preferences

I. Authority to extend preferences

    Present law.--Section 501 of the Trade Act of 1974 
authorizes the President to proclaim duty-free treatment for 
any eligible articles from any beneficiary country in 
accordance with the provisions of title V.
    Explanation of provision.--The recommendations make no 
change to this section of title V.

II. Designation of beneficiary developing countries [BDC's]

            A. Definition of country
    Present law.--Section 502 of the Trade Act of 1974 
currently sets out both the procedures for designating 
countries as Beneficiary Developing Countries [BDC's] and the 
conditions for such designation. This section establishes 
conditions for designation which are mandatory and others which 
are discretionary. With regard to the mandatory conditions, the 
President is prohibited from designating any country for GSP 
benefits which is a developed country listed in section 502(b). 
The term ``country'' is defined as any foreign country, any 
overseas dependent territory or possession of a foreign 
country, or the Trust Territory of the Pacific Islands.
    Explanation of provision.--The recommendations amend the 
definition of ``country'' to include any territory.
    Reason for change.--This change makes clear that the 
President has the authority to designate territories such as 
the territory of the West Bank and Gaza Strip as eligible for 
GSP benefits.
            B. Ineligible countries
    Present law.--Under section 502(b), the President is 
prohibited from designating a statutory list of countries as 
BDC's: Australia, Austria, Canada, European Union [EU] member 
states, Finland, Iceland, Japan, Monaco, New Zealand, Norway, 
Sweden, and Switzerland.
    Explanation of provision.--The recommendations would delete 
the reference to Austria, Finland, and Sweden.
    Reason for change.--Austria, Finland, and Sweden are now EU 
member states as a result of enlargement of the European Union 
on January 1, 1995.
            C. Mandatory conditions
    Present law.--Under section 502(c) the President is 
prohibited from designating as a BDC a country which:
          (1) is a Communist country, unless (a) its products 
        receive nondiscriminatory [MFN] treatment, (b) it is a 
        GATT contracting party and a member of the IMF, and (c) 
        it is not dominated or controlled by international 
        communism;
          (2) is an OPEC member, or a party to another 
        arrangement and participates in action the effect of 
        which is to withhold supplies of vital commodity 
        resources from international trade or raise their price 
        to an unreasonable level and to cause disruption of the 
        world economy;
          (3) affords reverse preferences having or likely to 
        have a significant adverse effect on U.S. commerce, 
        unless the President receives satisfactory assurances 
        of elimination before January 1, 1976;
          (4) has nationalized or expropriated U.S. property, 
        or taken similar actions, unless compensation is made, 
        being negotiated, or in arbitration;
          (5) fails to recognize as binding or enforce arbitral 
        awards in favor of U.S. citizens;
          (6) aids or abets, by granting sanctuary from 
        prosecution to, any individual or group which has 
        committed an act of international terrorism;
          (7) has not taken or is not taking steps to afford 
        internationally recognized worker rights to its 
        workers.
    Explanation of provision.--The recommendations retain 
present law, except, with respect to mandatory conditions:
          On (1)(b), replace ``is a GATT contracting party'' 
        with ``is a member of the World Trade Organization.'';
          On (2), delete the reference to OPEC member and the 
        exemption authority;
          On (3), delete the satisfactory assurances exemption 
        for reverse preferences.
    Reason for change.--These changes update the statute to: 
First, reflect the establishment of the World Trade 
Organization and; second, delete anachronistic references to 
OPEC and the date of January 1, 1976. It continues to be the 
view of the committee that BDC's should not provide 
discriminatory preferential advantages to developed countries 
at the same time the United States provides duty-free access 
for their imports.
    The committee notes the case initiated under section 301 of 
the Trade Act of 1974, as amended, against the export practices 
of Costa Rica and Columbia which have implemented the Framework 
on Bananas, dated March 29, 1994, in disregard of objections by 
the United States. The committee also notes that the U.S. Trade 
Representative has made a preliminary section 301 decision that 
discriminatory licensing under the European Union banana import 
regime adversely affects U.S. economic interests. The committee 
encourages USTR to exercise authority available, including 
discretionary authority extended by these recommendations, to 
resolve problems of trade discrimination experienced by U.S. 
banana companies as a result of the framework agreement. If 
substantial progress is not made the committee intends to 
revisit this issue at the appropriate time.
    The committee wishes to highlight its concern about 
unresolved commercial disputes where a foreign government is a 
party. The committee notes that GSP beneficiaries must satisfy 
a number of eligibility requirements to qualify for continued 
GSP privileges, and emphasizes that section 502(b)(2)(D) of the 
GSP statute provides that a country that is a party to an 
unresolved commercial dispute involving a U.S. citizen or 
corporation shall no longer receive GSP privileges, except 
under specified conditions. The committee expects the 
administration will use all reasonable means to urge the 
Government of the Dominican Republic to resolve a commercial 
dispute involving the liquified petroleum gas terminal operated 
under contract with the Dominican Republic by Western Energy, 
Inc.
            D. Discretionary criteria
    Present law.--Under section 502(c) the President must take 
into account a list of factors in determining whether to 
designate a country a BDC, including whether or not other major 
developed countries are granting GSP to the country, whether or 
not the country has taken or is taking steps to afford its 
workers internationally recognized worker rights, and the 
extent to which the country is providing adequate and effective 
intellectual property protection.
    Explanation of provision.--The recommendations substitute 
``whether or not'' for ``the extent to which'' in the 
intellectual property rights criteria, and to clarify that such 
protection may not be provided notwithstanding compliance with 
the Uruguay Round TRIP's Agreement. The recommendations also 
add new discretionary criteria for country designation. In 
determining whether to designate any country as a beneficiary 
developing country under this title, the President must take 
into account the extent to which such country fails to 
cooperate with the United States in preventing the 
proliferation of nuclear weapons, nuclear weapons components, 
and nuclear weapons delivery systems and in preventing illegal 
drug trafficking.
    Reason for change.--These changes reflect the committee's 
view that the fact that a country is in compliance with the 
obligations of Uruguay Round Trade Related Intellectual 
Property Rights Agreement does not necessarily indicate that it 
is providing adequate and effective intellectual property 
protection for purposes of receiving benefits under the GSP 
program.
    It is the committee's view that in determining whether to 
designate any country as a beneficiary country, the President 
should take into account the extent to which a country 
cooperates in preventing the proliferation of nuclear weapons, 
nuclear weapons components and nuclear weapons delivery 
systems, and in preventing illegal drug trafficking. The 
committee believes that these two criteria for granting 
countries GSP benefits provide the administration a useful 
additional discretionary tool to achieve national goals of 
halting the proliferation of nuclear weapons and promoting the 
cooperation of foreign governments in preventing illegal drug 
trade. Specific reference to illegal drug trafficking is 
consistent with the mandate under the Narcotics Control Trade 
Act to withdraw GSP benefits from countries which do not 
cooperate with the United States in preventing such trade.
            E. Graduation of beneficiary countries
    Present law.--If the per capita GNP of any BDC for any year 
exceeds a dollar limit--$11,800 in 1994--indexed annually under 
a formula from $8,500 in 1984, then that country is subject to 
a 25, rather than 50, percent competitive need [CN] import 
share limit on all eligible articles for the following 2 years. 
Thereafter, the country shall not be treated as a BDC.
    Explanation of provision.--The recommendations substitute 
``high income'' country as designated by the World Bank in any 
calendar year--$8,600 per capita GNP in 1994--for the per 
capita GNP indexing formula in current law. While retaining a 
transition period of up to 2 years for country graduation, the 
recommendations eliminate a statutory application of the 25 
percent competitive need limit during this 2-year period.
    Reason for change.--In 1994, the top 10 BDC's accounted for 
over 80 percent of U.S. GSP imports. In light of the 
committee's concern that a large share of GSP imports come from 
a small number of the more advanced developing countries, the 
committee concurs with the administration's recommendation to 
lower the per capita income threshold from approximately 
$11,800 to $8,600. While statistics indicate that very few 
countries would be affected by this change immediately, the 
result will be to graduate countries sooner from GSP than would 
be the case under current law. Using a readily available 
definition of high income country will make the administration 
of the program more transparent and predictable for users of 
the program.
    While the administration retains discretion to impose a 25 
percent competitive need limit for countries which have reached 
the per capita GNP limit, the recommendations simplify the law 
by eliminating this as a statutory requirement.

III. Designation of eligible articles (section 503)

            A. Exempted products
    Present law.--Under section 503, the President may not 
designate any article as GSP eligible within the following 
categories of import-sensitive articles:
          (1) textile and apparel articles which are subject to 
        textile agreements;
          (2) watches, except watches entered after June 30, 
        1989, that the President determines will not cause 
        material injury to watch or watch band, strap, or 
        bracelet manufacturing and assembly operations in the 
        United States or U.S. insular possessions;
          (3) import-sensitive electronic articles;
          (4) import-sensitive steel articles;
          (5) footwear, handbags, luggage, flat goods, work 
        gloves, and leather wearing apparel which were not GSP 
        eligible articles on April 1, 1984;
          (6) import-sensitive semi-manufactured and 
        manufactured glass products; and
          (7) any other articles the President determines to be 
        import sensitive in the context of GSP.
    Explanation of provision.--The recommendations retain all 
provisions of present law, except, with respect to statutory 
exemptions:
          On (1), replace present provision with exemption of 
        textile and apparel articles which were not GSP 
        eligible on January 1, 1994;
          On (2), delete statutory exemption for watches;
          On (5), apply exemption to footwear and related 
        articles which were not GSP eligible on January 1, 
        1995.
    Reason for change.--These changes delete anachronistic 
dates and ensure that all products, except watches, which are 
currently excluded from GSP eligibility remain excluded.
    Deleting watches from the list of products statutorily 
excluded from GSP eligibility reflects the committee's 
understanding that major changes have taken place in the U.S. 
watch industry in recent years. Under the provision, the 
President would conduct an administrative review of a petition 
filed to add watches that would include a hearing, and the 
collection of public comment and ITC advice, before designating 
watches as an eligible product under the program.
            B. Three-year rule
    Present law.--Each year USTR conducts an interagency review 
process in which products can be added to or removed from the 
GSP program, or in which a country's compliance with 
eligibility requirements can be reviewed. The reviews are 
normally based on petitions filed by interested parties, but 
may also be self-initiated.
    Explanation of provision.--The recommendations prohibit 
reconsideration of an article for designation, for 3 years 
following formal consideration and denial of that article.
    Reason for Change.--The committee wants to ensure that 
reviews of petitions and self-initiation of investigations to 
add the same item to the list of eligible articles occur no 
more than once every 3 years. Petitions to remove products from 
the list of eligible articles shall continue to be entertained 
annually. This statutory provision will prevent violations of 
the 3-year rule limiting reviews that the Ways and Means 
Committee recommended in 1984, in order to reduce the burden on 
U.S. industry.
    In promulgating regulations for this program as 
reauthorized, it is the committee's view that the President 
should specify a mandatory core of information that all product 
petitions must contain. Petitions for the addition of products 
to the list of eligible articles shall be accepted for review 
only if they include such information as is reasonably 
available to the petitioner concerning, for example, the 
petitioner's--beneficiary developing--country's industry, the 
industry's capacity for production, its competitiveness with 
respect to an article and such other information as the 
President may require.
    In order to provide that nations which are found to be 
competitive producers of a product can be denied benefits 
before the process of reviewing petitions concludes, the 
committee recommends the following addition to the GSP 
regulations: ``If at any time prior to or during the review of 
a petition to designate a new product eligible for GSP, the 
Trade Policy Staff Committee [TPSC] has determined that a 
beneficiary country is competitive in that product, as 
stipulated in the Statement of Administrative Action that 
accompanied the Uruguay Round Agreements Act, to a degree that 
GSP benefits are not warranted for that country, it shall make 
such a determination by notice in the Federal Register. In 
assessing a country's competitiveness, the TPSC will consider 
such items as prices, production capacity, U.S. market share 
and performance in equivalent markets of producers operating 
within a beneficiary developing country.'' The committee 
believes that this addition to the GSP regulations will lessen 
the burden on U.S. interests in responding to petitions.
    The Committee also notes that the statement of 
administrative action [SAA] also addresses the need for the 
administration to verify information from foreign producers in 
certain cases. In this vein, the committee recommends the 
following addition to the GSP regulations: ``In cases where the 
Trade Policy Staff Committee has a reasonable doubt (including 
on the basis of comments from interested parties) about the 
accuracy of information in a petition that is material to a 
finding of import sensitivity, the Trade Policy Staff Committee 
shall request a verification of such information by the U.S. 
Embassy (or other U.S. Government representative) in the 
country in question. The information received in response to 
the request shall be a matter of public record to the degree 
that such information is not classified by the U.S. Government 
or is not information exempt from public inspection as 
described in section 2007.7 of the GSP regulations.
            C. Least developed developing countries [LDDC's]
    Present law.--No provision.
    Explanation of provision.--The recommendations add 
authority for the President to designate any article that is 
the growth, product, or manufacture of a least developed 
developing country as an eligible article with respect to 
imports from LDDC's, if, after receiving advice from the 
International Trade Commission, the President determines such 
article is not import sensitive in the context of imports from 
LDDC's. This authority does not apply to statutorily exempt 
articles. The President shall notify Congress at least 60 days 
in advance of LDDC designations. LDDC designations will be 
based on overall economic and discretionary criteria for 
country designation under the program.
    Reason for change.--The committee believes that this 
additional authority which is sought by the administration will 
promote the goal of expanding the share of GSP benefits that 
can be granted to the poorest countries in the world. While a 
product may be import sensitive in the context of all GSP 
imports, if imports from only least developed developing 
countries are considered, import sensitivity may not be a 
problem. This authority should have the effect of giving an 
additional competitive opportunity to LDDC's in certain 
situations where their products are not able to compete with 
imports from the most advanced developing countries, and 
thereby expand the share of GSP imports from LDDC's.
            D. Limits on preferential treatment
            1. General authority
    Present law.--Under section 504, the President may 
withdraw, suspend, or limit GSP duty-free treatment with 
respect to any article or any country, except that no rate of 
duty may be established other than the rate which would 
otherwise apply--the MFN rate, after considering the overall 
GSP and discretionary BDC designation factors. The President 
shall withdraw or suspend the BDC designation of any country if 
he determines that, as a result of changed circumstances, the 
country would be barred from designation.
    Explanation of provision.--The recommendations add a 
requirement that, except in exceptional circumstances, the 
President may not take action to withdraw, suspend, or 
terminate or limit GSP treatment with respect to any country 
without first providing a period for the submission of public 
comments.
    Reason for change.--The purpose of this change is to ensure 
that the business community and beneficiary countries are not 
surprised by the graduation of beneficiary countries which have 
not reached the statutory per-capita-income threshold that 
mandates automatic graduation. Under title V the President has 
broad authority to designate countries as beneficiary 
developing countries, if such countries satisfy the statutory 
eligibility requirements. The President also has broad 
authority to withdraw, suspend, or limit GSP privileges for 
beneficiary countries that no longer meet the statutory 
eligibility requirements or that are found to be sufficiently 
developed and globally competitive such that the country no 
longer needs tariff preferences to compete in the U.S. market. 
The new language is intended to clarify the committee's view 
that advice from U.S companies and other public comments should 
be considered by the President before he exercises his 
discretionary authority to graduate these countries on the 
basis of their international competitiveness. The committee 
recognizes, however, that the formal solicitation of public 
comments may not be feasible in exceptional circumstances, 
where sudden developments warrant immediate Presidential 
action, or where delay would jeopardize critical U.S. foreign 
policy objectives. The committee expects that, in nearly all 
cases, public comments would be solicited and considered prior 
to any action being taken under this section. If exceptional 
circumstances exist and no formal public comments are 
solicited, the committee expects that the President would make 
every effort to consult with the private sector informally and 
to advise the Congress prior to taking any action.
            2. Reporting requirement
    Present law.--The President shall, as necessary, advise the 
Congress, and by no later than January 4, 1988, submit to the 
Congress a report on the application of the overall GSP and 
discretionary country designation factors, and the actions the 
President has taken to withdraw, suspendse where, or limit the 
GSP treatment with respect to any country which has failed to 
adequately meet the discretionary designation factors.
    Explanation of provision.--The recommendations delete this 
reporting requirement.
    Reason for change.--The statutory reporting requirement has 
been met. Section 2 of the recommendations would require a 
report to Congress on the operation of the program by July 31, 
1997.
            3. Competitive need limits
    Present law.--Whenever the President determines that annual 
exports by any BDC to the United States of a GSP eligible 
article: No. 1 exceed a dollar limit--$114 million in 1994--
based on $25 million adjusted annually relative to changes in 
the U.S. GNP since 1974, or No. 2 equal or exceed a 50-percent 
share of the total value of U.S. imports of the article, then, 
not later than July 1 of the next year, such a country is not 
treated as a BDC with respect to such article.
    Explanation of provision.--The recommendations reduce the 
basic competitive need limit to $75 million for any year 
beginning January 1, 1995, and substitute a standard annual 
increase of $5 million for the indexing formula in current law. 
The recommendations preserve the 50-percent market share 
competitive need limit.
    Reason for change.--Reducing the basic competitive need 
limit will have the effect of increasing the opportunities for 
countries other than the top beneficiaries to obtain a larger 
share of GSP benefits. The standard annual increase of $5 
million a year is a simplification of current law which will 
make the implementation of competitive need limits more 
predictable for users of the program.
            4. General review
    Present law.--Not later than January 4, 1987, and 
periodically thereafter, the President must conduct a general 
review of eligible articles and, if he determines that a BDC 
has demonstrated a sufficient degree of competitiveness 
relative to other BDC's on any eligible article, then a lower 
CN dollar limit--$41.9 million in 1993, indexed annually from 
1984 base--and 25-percent total import share limit apply.
    Explanation of provision.--The recommendations delete the 
general review requirement and the lower competitive need 
limits.
    Reason for change.--While the administration would retain 
authority to conduct reviews of the program it considers 
appropriate, the committee believes this should be a matter 
left up to the judgment of the administration. The committee 
believes that resources used to conduct a general review of all 
products on GSP may be better used elsewhere in administration 
of the program. Deleting the lower competitive need limit is 
another change which simplifies the administration of the 
program.

IV. Waiver authority

            A. General authority
    Present law.--The President may waive the dollar and import 
share CN limits on any eligible article of any BDC if he first, 
receives ITC advice on whether any U.S. industry is likely to 
be adversely affected by the waiver; second, determines, based 
on the overall GSP and discretionary country designation 
considerations and the ITC advice, that the waiver is in the 
U.S. national economic interest; and third, publishes the 
determination in the Federal Register.
    Explanation of provision.--The recommendations retain the 
present waiver authority.
            B. Historical preferences
    Present law.--There are several statutory circumstances in 
which the President may waive competitive need [CN] limits. 
Except where sufficient competitiveness has been demonstrated, 
the President may waive CN limits if: First, there has been a 
historical preferential trade relationship between the United 
States and the country; second, there is a treaty or trade 
agreement in force covering our bilateral economic relations; 
and third, the country does not maintain unfair trade barriers 
on U.S. commerce.
    Explanation of provision.--The recommendations would delete 
the historical preferences provision.
    Reason for change.--This waiver authority, which was 
designed for a possible exemption of the Philippines, has never 
been used and is no longer necessary.
            C. No domestic production
    Present law.--The import share limit does not apply to any 
eligible article if a like or directly competitive article is 
not produced in the United States as of January 3, 1985.
    Explanation of provision.--Under the recommendations, the 
import share limit does not apply if the article is not 
produced in the United States as of January 1, 1995.
    Reason for change.--This change is made to revise an 
anachronistic date.
            D. De minimis imports
    Present law.--The import share limit may be disregarded if 
total U.S. imports of the eligible article during the preceding 
year do not exceed a de minimis amount of $5 million adjusted 
annually--$13.4 million in 1994--according to changes in U.S. 
GNP since 1979.
    Explanation of provision.--The recommendations retain the 
de minimis import provision, but substitute $13 million in 1995 
and a standard annual increase of $500,000 beginning January 1, 
1996 for the indexing formula in current law. The 
recommendations provide for the refund of duties paid on 
buffalo leather from Thailand during the month of July 1995.
    Reason for change.--The first change is intended to 
simplify and make more predictable the calculation of the level 
of imports deemed to be de minimis. The refund of duties 
described above relates to the restoration of GSP benefits for 
buffalo leather from Thailand under the de minimis waiver. On 
July 28, 1995 the President restored GSP treatment to this 
product, but not for the time period that included the month of 
July 1995. The committee believes that there should be no break 
in duty-free treatment for this product.
            E. Waiver trade limits
    Present law.--The President may not exercise the waiver 
authority in any year on imports of eligible articles 
exceeding: First, 30 percent of total GSP duty-free imports 
during the preceding year, or second, 15 percent of total GSP 
duty-free imports during the preceding year from BDCs which had 
(a) a per capita GNP of $5,000 or more, or (b) exported to the 
United States more than 10 percent of total GSP duty-free 
imports during that year.
    Explanation of provision.--The recommendations delete 
waiver trade limits described above.
    Reason for change.--The committee believes that its goal of 
simplifying the statute is served by removing this overly 
detailed direction to the administration regarding the use of 
GSP waiver authority.

V. Provisions regarding termination, reports, and agriculture exports

            A. Termination
    Present law.--No duty-free treatment shall remain in effect 
after July 31, 1995.
    Explanation of provision.--The recommendations would 
reauthorize the program for 2\1/2\ years to terminate on 
December 31, 1997. The recommendations provide for refunds, 
upon request of the importer, of any duty paid between July 31, 
1995 and the date of enactment.
    Reason for change.--The committee believes that recent 
short-term extensions of the program have been highly 
disruptive to U.S. companies who rely on GSP products, and to 
the economic development of beneficiary countries. Budgetary 
effects of the program, however, continue to preclude a longer 
extension of the program. So that there will be no gap in duty-
free treatment, the recommendations provide for a retroactive 
extension of the program.
            B. Report on operation of the program
    Present law.--On or before January 4, 1990, the President 
must submit a full and complete report to the Congress on the 
operation of the program.
    Explanation of provision.--The recommendations require this 
same report to be submitted by July 31, 1997.
    Reason for change.--It is the view of the committee that 
periodic reports on the operation of the program continue to be 
useful to Congress and interested parties.
            C. Report on worker's rights
    Present law.--The President must submit an annual report to 
the Congress on the status of internationally recognized 
workers' rights within each BDC.
    Explanation of provision.--The recommendations retain an 
annual report on the status of workers' rights within each BDC.
    Reason for change.--It is the view of the committee that 
this annual report continues to be useful in evaluating 
progress toward the establishment of workers' rights in 
beneficiary countries.
            D. Agriculture exports
    Present law.--Section 506 requires that appropriate U.S. 
agencies assist BDC's in developing and implementing measures 
designed to assure that the production of agricultural sectors 
of their economies is not directed to export markets, to the 
detriment of the foodstuff production for their citizens.
    Explanation of provision.--The recommendations would delete 
this section.
    Reason for change.--Consistent with the goal of simplifying 
and improving the program, the Committee believes that this use 
of agency resources is no longer justified.

              III. Subtitle C--Trade Adjustment Assistance

                            A. INTRODUCTION

                         1. Purpose and summary

    The recommendations of the Committee on Ways and Means 
respond to the House Budget Committee's recommendations to 
eliminate Trade Adjustment Assistance [TAA] for workers. The 
recommendations extend the reauthorization of general TAA for 
workers and TAA for firms through September 30, 2000, after 
which both programs are terminated. The NAFTA-related TAA 
program would terminate on September 30, 1998, as under current 
law. The recommendations also require that workers under 
general TAA enter approved training programs in order to 
receive further cash benefits, as they are required to do under 
the NAFTA Worker Security Act. The Secretary of Labor is 
permitted to issue waivers of the training requirement only if 
training is not available to eliglble unemployed workers. 
Lastly, relocation benefits for workers are terminated under 
the general TAA program and the NAFTA-related TAA program. The 
effective date for these changes is September 30, 1996.

                 2. Background and need for legislation

    On May 18, 1995, the House Budget Committee recommended 
eliminating trade adjustment assistance for workers on the 
grounds that there is no justification for providing more 
assistance to workers whose unemployment results from foreign 
competition than to those whose unemployment results from 
domestic competition. The President's fiscal year 1996 budget 
proposed to terminate TAA for firms. For these reasons, the 
committee undertook a full review of not only general TAA and 
NAFTA-related TAA, but also TAA for firms. The committee 
believes these programs should be continued for a specific 
period of time.

                         3. Legislative history

    On May 16, 1995, the Human Resources Subcommittee held a 
hearing on consolidation of job training programs, including 
TAA (WMCP: 104-8).
    On June 12, 1995, Trade Subcommittee Chairman Crane 
requested written comments on the TAA programs for workers and 
firms. The closing date for offering such written comments was 
June 30, 1995. The comments received supported continuation of 
these programs.
    On September 21, 1995, the Committee on Ways and Means 
ordered favorably reported to the House Committee on the 
Budget, by voice vote, the recommendations to modify trade 
adjustment assistance for inclusion in budget reconciliation 
legislation.
    The committee believes that the existing waiver authority 
has been used too frequently but that some flexibility in the 
application of the training requirement is necessary so that 
workers are not penalized and are able to receive assistance if 
approved training is not available. If such training 
subsequently becomes available, the secretary is required to 
revoke the waiver and the worker must enter training for cash 
benefits to continue.

  B. SECTION-BY-SECTION SUMMARY OF THE PROVISIONS RECOMMENDED BY THE 
COMMITTEE ON WAYS AND MEANS, JUSTIFICATION, AND COMPARISON WITH PRESENT 
                                  LAW

        Sec. 12201. Modification of trade adjustment assistance

(a) Requirement of training

            Present law
    Under chapter 2 of title II of the Trade Act of 1974, 
eligible workers certified by the Secretary of Labor are 
entitled to TAA benefits including training, job search, and 
relocation allowances. Qualified workers in approved training 
are entitled to receive trade adjustment allowance [TRA] 
payments following the exhaustion of unemployment insurance 
[UI] equal to their weekly UI amount for up to 52 weeks of UI 
and TRA combined. Workers may receive an additional 26 weeks of 
TRA benefits to complete approved training. The Secretary of 
Labor may waive the training requirement under the general TAA 
program if approved training is not ``feasible or 
appropriate.'' The NAFTA TAA program does not authorize waivers 
of the training requirements.
            Explanation of provision
    The recommendations require workers under the general and 
NAFTA-related TAA programs to enter approved training programs 
in order to receive TRA payments. The Secretary of Labor may 
issue a waiver of the training requirement for general TAA only 
if training is not ``available.''
            Reason for change
    The recommendations harmonize the training requirements 
under general TAA with NAFTA-related TAA and tighten the 
requirement that benefit recipients be enrolled in training 
under general TAA. The recommendations require workers to enter 
approved training programs in order to receive cash benefits 
under general TAA as currently is the case under NAFTA-related 
TAA. The Secretary of Labor is permitted to issue waivers of 
the training requirement under general TAA only if training is 
not available.
            Effective date
    October 1, 1996.

(b) Termination of relocation allowances

            Present law
    Relocation allowances are available to eligible displaced 
workers under both general TAA and NAFTA-related TAA.
            Explanation of provision
    The recommendations terminate relocation allowances under 
both general TAA and NAFTA-related TAA.
            Reason for change
    The recommendations end a system in which workers 
unemployed due to foreign competition are relocated at the 
expense of the Federal Government while those unemployed due to 
domestic competition are not eligible for such assistance.
            Effective date
    October 1, 1996.

(c) Termination of program

            Present law
    General trade adjustment assistance for workers, the NAFTA-
related TAA program, and trade adjustment assistance for firms 
are authorized through fiscal year 1998 and terminate as of 
September 30, 1998.

Explanation of provision

    The committee recommendations authorize general TAA for 
workers and TAA for firms through fiscal year 2000, and 
terminate these programs after September 30, 2000.
            Reason for change
    This timeframe coincides with the renewal period proposed 
for extension of fast-track trade agreement authority under 
H.R. 2371.
            Effective date
    October 1, 1996.

   Changes in Existing Law Made by Title III of the Bill, as Reported

    In compliance with clause 3 of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (existing law 
proposed to be omitted is enclosed in black brackets, new 
matter is printed in italic, existing law in which no change is 
proposed is shown in roman):

                           TARIFF ACT OF 1930

                     TITLE III--SPECIAL PROVISIONS

                         Part I--Miscellaneous

          * * * * * * *

SEC. 304. MARKING OF IMPORTED ARTICLES AND CONTAINERS.

    (a) * * *
          * * * * * * *
    (f) Marking of Metal Forgings.--The marking requirements of 
subsections (a) and (b) shall not apply to--
          (1) metal forgings that--
                  (A) are imported for processing into finished 
                hand tools in the United States, and
                  (B) have not been improved in condition 
                beyond rough burring, trimming, grinding, 
                turning, hammering, chiseling, or filing; and
          (2) hand tools made from metal forgings described in 
        paragraph (1).
    (g) Marking of Certain Coffee and Tea Products.--The 
marking requirements of subsections (a) and (b) shall not apply 
to articles described in subheading 0901.21, 0901.22, 0902.10, 
0902.20, 0902.30, 0902.40, 2101.10, or 2101.20 of the 
Harmonized Tariff Schedule of the United States, as in effect 
on January 1, 1995.
    (h) Marking of Spices.--The marking requirements of 
subsections (a) and (b) shall not apply to articles provided 
for under subheadings 0904.11, 0904.12, 0904.20, 0905.00, 
0906.10, 0906.20, 0907.00, 0908.10, 0908.20, 0908.30, 0909.10, 
0909.20, 0909.30, 0909.40, 0909.50, 0910.10, 0910.20, 0910.30, 
0910.40, 0910.50, 0910.91, 0910.99, 1106.20, 1207.40, 1207.50, 
1207.91, 1404.90, and 3302.10, and items classifiable in 
categories 0712.90.60, 0712.90.8080, 1209.91.2000, 
1211.90.2000, 1211.90.8040, 1211.90.8050, 1211.90.8090, 
2006.00.3000, 2918.13.2000, 3203.00.8000, 3301.90.1010, 
3301.90.1020, and 3301.90.1050 of the Harmonized Tariff 
Schedule of the United States, as in effect on January 1, 1995.
    [(f)] (i) Additional Duties For Failure to Mark.--If at the 
time of importation any article (or its container, as provided 
in subsection (h) hereof) is not marked in accordance with the 
requirements of this section, and if such article is not 
exported or destroyed or the article (or its container, as 
provided in subsection (b) hereof) marked after importation in 
accordance with the requirements of this section (such 
exportation, destruction, or marking to be accomplished under 
customs supervision prior to the liquidation of the entry 
covering the article, and to be allowed whether or not the 
article has remained in continuous customs custody), there 
shall be levied, collected, and paid upon such article a duty 
of 10 per centum ad valorem, which shall be deemed to have 
accrued at the time of importation, shall not be construed to 
be penal, and shall not be remitted wholly or in part nor shall 
payment thereof be avoidable for any cause. Such duty shall be 
levied, collected, and paid in addition to any other duty 
imposed by law and whether or not the article is exempt from 
the payment of ordinary customs duties. The compensation and 
expenses of customs officers and employees assigned to 
supervise the exportation, destruction, or marking to exempt 
articles from the application of the duty provided for in this 
subsection shall be reimbursed to the Government by the 
importer.
    [(g)] (j) Delivery Withheld Until Marked.--No imported 
article held in customs custody for inspection, examination, or 
appraisement shall be delivered until such article and every 
other article of the importation (or their containers), whether 
or not released from customs custody, shall have been marked in 
accordance with the requirements of this section or until the 
amount of duty estimated to be payable under subsection (f) of 
this section has been deposited. Nothing in this section shall 
be construed as excepting any article (or its container) from 
the particular requirements of marking provided for in any 
other provision of law.
    [(h)] (k) Treatment of Goods of a NAFTA Country.--
          (1) Application of section.--In applying this section 
        to an article that qualifies as a good of a NAFTA 
        country (as defined in section 2(4) of the North 
        American Free Trade Agreement Implementation Act) under 
        the regulations issued by the Secretary to implement 
        Annex 311 of the North American Free Trade Agreement--
          * * * * * * *
    [(i)] (l) Penalties.--Any person who, with intent to 
conceal the information given thereby or contained therein, 
defaces, destroys, removes, alters, covers, obscures, or 
obliterates any mark required under the provisions of this Act 
shall--
          (1) upon conviction for the first violation of this 
        subsection, be fined not more than $100,000, or 
        imprisoned for not more than 1 year, or both; and
          * * * * * * *

                Part II--United States Tariff Commission

          * * * * * * *

SEC. 313. DRAWBACK AND REFUNDS.

    (a) * * *
          * * * * * * *
    (r) Filing Drawback Claims.--
          (1) * * *
          * * * * * * *
          (3)(A)(i) Subject to clause (ii), the Customs Service 
        may, notwithstanding the limitation set forth in 
        paragraph (1), extend the time for filing a drawback 
        claim for a period not to exceed 18 months, if--
                  (I) the claimant establishes to the 
                satisfaction of the Customs Service that the 
                claimant was unable to file the drawback claim 
                because of an event declared by the President 
                to be a major disaster on or after January 1, 
                1994; and
                  (II) the claimant files a request for such 
                extension with the Customs Service within one 
                year from the last day of the 3-year period 
                referred to in paragraph (1).
          (ii) In the case of a major disaster occurring on or 
        after January 1, 1994, and before the date of the 
        enactment of this paragraph--
                  (I) the Customs Service may extend the time 
                for filing the drawback claim for a period not 
                to exceed 1 year; and
                  (II) the request under clause (i)(II) must be 
                filed not later than 1 year from the date of 
                the enactment of this paragraph.
          (B) If an extension is granted with respect to a 
        request filed under this paragraph, the periods of time 
        for retaining records set forth in subsection (t) of 
        this section and section 508(c)(3) shall be extended 
        for an additional 18 months or, in a case to which 
        subparagraph (A)(ii) applies, for a period not to 
        exceed 1 year from the date the claim is filed.
          (C) For purposes of this paragraph, the term ``major 
        disaster'' has the meaning given that term in section 
        102(2) of the Robert T. Stafford Disaster Relief and 
        Emergency Assistance Act (42 U.S.C. 5122(2)).
    (s) Designation of Merchandise by Successor.--
          (1) * * *
          (2) For purposes of subsection (j)(2), a drawback 
        successor may designate--
                  (A) imported merchandise which the 
                predecessor, before the date of succession, 
                imported; or
                  (B) imported merchandise, commercially 
                interchangeable merchandise, or any combination 
                of imported and commercially interchangeable 
                merchandise for which the [successor] 
                predecessor received, before the date of 
                succession, from the person who imported and 
                paid any duty due on the imported merchandise a 
                certificate of delivery transferring to the 
                successor such merchandise;
        as the basis for drawback on merchandise possessed by 
        the drawback successor after the date of succession.
          * * * * * * *

SEC. 321. ADMINISTRATIVE EXEMPTIONS.

    (a) The Secretary of the Treasury, in order to avoid 
expense and inconvenience to the Government disproportionate to 
the amount of revenue that would otherwise be collected, is 
hereby authorized, under such regulations as he shall 
prescribe, to--
          (1) * * *
          (2) admit articles free of duty and of any tax 
        imposed on or by reason of importation, but the 
        aggregate fair retail value in the country of shipment 
        of articles imported by one person on one day and 
        exempted from the payment of duty shall not exceed an 
        amount specified by the Secretary by regulation, but 
        not less than--
                  (A) * * *
                  (B) $200 in the case of articles 
                accompanying, and for the personal or household 
                use of, persons arriving in the United States 
                who are not entitled to any exemption from duty 
                under subheading 9804.00.30, 9804.00.65, or 
                9804.00.70 of this Act, or
          * * * * * * *

                  TITLE IV--ADMINISTRATIVE PROVISIONS

      Part I--Definitions and National Customs Automation Program

                         Subpart A--Definitions

SEC. 401. MISCELLANEOUS.

    When used in this title or in Part I of Title III--
    (a) * * *
          * * * * * * *
    (s) The term ``reconciliation'' means an electronic 
process, initiated at the request of an importer, under which 
the elements of an entry, other than those elements related to 
the admissibility of the merchandise, that are undetermined at 
the time of entry summary are provided to the Customs Service 
at a later time. A reconciliation is treated as an entry for 
purposes of liquidation, reliquidation, recordkeeping, and 
protest.
          * * * * * * *

      Part II--Report, Entry, and Unlading of Vessels and Vehicles

SEC. 431. MANIFEST--REQUIREMENT, FORM, AND CONTENTS.

    (a) * * *
          * * * * * * *
    (c)(1) Except as provided in subparagraph (2), the 
following information, when contained in [such manifest] a 
vessel manifest, shall be available to public disclosure:
          (A) * * *
          * * * * * * *

      Part III--Ascertainment, Collection, and Recovery of Duties

          * * * * * * *

SEC. 484. ENTRY OF MERCHANDISE.

    (a) Requirement and Time.--
          (1) Except as provided in sections 490, 498, 552, 
        [553, and 336(j)] and 553, one of the parties 
        qualifying as ``importer of record'' under paragraph 
        (2)(B), either in person or by an agent authorized by 
        the party in writing, shall, using reasonable care--
                  (A) * * *
          * * * * * * *

SEC. 504. LIMITATION ON LIQUIDATION.

    (a) * * *
          * * * * * * *
    (d) Removal of Suspension.--Except as provided in section 
751(a)(3), when a suspension required by statute or court order 
is removed, the Customs Service shall liquidate the entry, 
unless liquidation is extended under subsection (b), within 6 
months after receiving notice of the removal from the 
Department of Commerce, other agency, or a court with 
jurisdiction over the entry. Any entry not liquidated by the 
Customs Service within 6 months after receiving such notice 
shall be treated as having been liquidated at the rate of duty, 
value, quantity, and amount of duty asserted at the time of 
entry by the importer of record.

SEC. 505. PAYMENT OF DUTIES AND FEES.

    (a) * * *
          * * * * * * *
    (c) Interest.--Interest assessed due to an underpayment of 
duties, fees, or interest shall accrue, at a rate determined by 
the Secretary, from the date the importer of record is required 
to deposit estimated duties, fees, and interest to the date of 
liquidation or reliquidation of the applicable entry or 
reconciliation. Interest on excess moneys deposited shall 
accrue, at a rate determined by the Secretary, from the date 
the importer of record deposits estimated duties, fees, and 
interest or, in a case in which a claim is made under section 
520(d), from the date on which such claim is made, to the date 
of liquidation or reliquidation of the applicable entry or 
reconciliation.
          * * * * * * *

SEC. 508. RECORDKEEPING.

    (a) * * *
          * * * * * * *
    (c) Period of Time.--The records required by subsections 
(a) and (b) shall be kept for such periods of time as the 
Secretary shall prescribe; except that--
          (1) no period of time for the retention of the 
        records required under subsection (a) or (b)(3) may 
        exceed 5 years from the date of entry, filing of a 
        reconciliation, or exportation, as appropriate;
          * * * * * * *

SEC. 509. EXAMINATION OF BOOKS AND WITNESSES.

    (a) Authority.--In any investigation or inquiry conducted 
for the purpose of ascertaining the correctness of any entry, 
for determining the liability of any person for duty, fees, 
fees and taxes due or duties, fees, fees and taxes which may be 
due the United States, for determining liability for fines and 
penalties, or for ensuring compliance with the laws of the 
United States administered by the United States Customs 
Service, the Secretary (but no delegate of the Secretary below 
the rank of district director or special agent in charge) may--
          (1) * * *
          (2) summon, upon reasonable notice--
                  (A) * * *
          * * * * * * *
                  (D) any other person he may deem proper; to 
                appear before the appropriate customs officer 
                at the time and place within the customs 
                territory of the United States specified in the 
                summons (except that no witness may be required 
                to appear at any place more than one hundred 
                miles distant from the place where he was 
                served with the summons), to produce records, 
                as defined in subsection [(c)(I)(A)] (d)(1)(A), 
                and to give such testimony, under oath, as may 
                be relevant to such investigation or inquiry; 
                and
          * * * * * * *
    (b) Regulatory Audit Procedures.--
          (1) * * *
          * * * * * * *
          (3) Except as provided in paragraph (5), if the 
        estimated or actual termination date for an audit 
        passes without the Customs Service auditor providing a 
        closing conference to explain the results of the audit, 
        the person being audited may petition in writing for 
        such a conference to the [appropriate regional 
        commissioner] officer designated pursuant to 
        regulations, who, upon receipt of such a request, shall 
        provide for such a conference to be held within 15 days 
        after the date of receipt.
          (4) Except as provided in paragraph (5), the Customs 
        Service auditor shall complete the formal written audit 
        report within 90 days following the closing conference 
        unless the [appropriate regional commissioner] officer 
        designated pursuant to regulations provides written 
        notice to the person being audited of the reason for 
        any delay and the anticipated completion date. After 
        application of any exemption contained in section 552 
        of title 5, United States Code, a copy of the formal 
        written audit report shall be sent to the person 
        audited no later than 30 days following completion of 
        the report.
          * * * * * * *
    Sec. 515. Review of Protests.--
    (a) * * *
          * * * * * * *
    (d) If a protest is timely and properly filed, but is 
denied contrary to proper instructions, the Customs Service may 
on its own initiative, or pursuant to a written request by the 
protesting party filed with the appropriate [district director] 
port director within 90 days after the date of the protest 
denial, void the denial of the protest.
          * * * * * * *

SEC. 592. PENALTIES FOR FRAUD, GROSS NEGLIGENCE, AND NEGLIGENCE.

    (a) Prohibition.--
          (1) General rule.--Without regard to whether the 
        United States is or may be deprived of all or a portion 
        of any [lawful duty] lawful duty, tax, or fee thereby, 
        no person, by fraud, gross negligence, or negligence--
                  (A) * * *
          * * * * * * *
    (b) Procedures.--
          (1) Pre-penalty notice.--
                  (A) In general.--If the Customs Service has 
                reasonable cause to believe that there has been 
                a violation of subsection (a) and determines 
                that further proceedings are warranted, it 
                shall issue to the person concerned a written 
                notice of its intention to issue a claim for a 
                monetary penalty. Such notice shall--
                          (i) * * *
          * * * * * * *
                          (vi) state the estimated loss of 
                        [lawful duties] lawful duties, taxes, 
                        and fees, if any, and, taking into 
                        account all circumstances, the amount 
                        of the proposed monetary penalty; and
          * * * * * * *
    (c) Maximum Penalties.--
          (1) * * *
          (2) Gross negligence.--A grossly negligent violation 
        of subsection (a) is punishable by a civil penalty in 
        an amount not to exceed--
                  (A) the lesser of--
                          (i) the domestic value of the 
                        merchandise, or
                          (ii) four times the [lawful duties] 
                        lawful duties, taxes, and fees of which 
                        the United States is or may be 
                        deprived, or
                  (B) if the violation did not affect the 
                assessment of duties, 40 percent of the 
                dutiable value of the merchandise.
          (3) Negligence.--A negligent violation of subsection 
        (a) is punishable by a civil penalty in an amount not 
        to exceed--
                  (A) the lesser of--
                          (i) the domestic value of the 
                        merchandise, or
                          (ii) two times the [lawful duties] 
                        lawful duties, taxes, and fees of which 
                        the United States is or may be 
                        deprived, or
                  (B) if the violation did not affect the 
                assessment of duties, 20 percent of the 
                duitable value of the merchandise.
          (4) Prior disclosure.--If the person concerned 
        discloses the circumstances of a violation of 
        subsection (a) before, or without knowledge of, the 
        commencement of a formal investigation of such 
        violation, with respect to such violation, merchandise 
        shall not be seized and any monetary penalty to be 
        assessed under subsection (c) shall not exceed--
                  (A) if the violation resulted from fraud--
                          (i) an amount equal to 100 percent of 
                        the [lawful duties] lawful duties, 
                        taxes, and fees of which the United 
                        States is or may be deprived, so long 
                        as such person tenders the unpaid 
                        amount of the [lawful duties] lawful 
                        duties, taxes, and fees at the time of 
                        disclosure, or within 30 days (or such 
                        longer period as the Customs Service 
                        may provide) after notice by the 
                        Customs Service of its calculation of 
                        such unpaid amount, or
                          (ii) if such violation did not affect 
                        the assessment of duties, 10 percent of 
                        the dutiable value; or
                  (B) if such violation resulted from 
                negligence or gross negligence, the interest 
                (computed from the date of liquidation at the 
                prevailing rate of interest applied under 
                section 6621 of the Internal Revenue Code of 
                1954) on the amount of [lawful duties] lawful 
                duties, taxes, and fees of which the United 
                States is or may be deprived so long as such 
                person tenders the unpaid amount of the [lawful 
                duties] lawful duties, taxes, and fees at the 
                time of disclosure, or within 30 days (or such 
                longer period as the Customs Service may 
                provide) after notice by the Customs Service of 
                its calculation of such unpaid amount.
        The person asserting lack of knowledge of the 
        commencement of a formal investigation has the burden 
        of proof in establishing such lack of knowledge. For 
        purposes of this section, a formal investigation of a 
        violation is considered to be commenced with regard to 
        the disclosing party and the disclosed information on 
        the date recorded in writing by the Customs Service as 
        the date on which facts and circumstances were 
        discovered or information was received which caused the 
        Customs Service to believe that a possibility of a 
        violation of subsection (a) existed.
          * * * * * * *
  (d) Deprivation of Lawful Duties, Taxes or Fees.--
Notwithstanding section 514 of this Act, if the United States 
has been deprived of lawful duties, taxes, or fees as a result 
of a violation of subsection (a), the Customs Service shall 
require that such lawful duties, taxes [or fees be restored] 
and fees be restored, whether or not a monetary penalty is 
assessed.
          * * * * * * *

SEC. 631. USE OF PRIVATE COLLECTION AGENCIES.

  (a) In General.--Notwithstanding any other provision of law, 
including section 3302 of title 31, United States Code, and 
subchapters I and II of chapter 37 of such title, the 
Secretary, under such terms and conditions as the Secretary 
considers appropriate, shall enter into contracts and incur 
obligations with one or more persons for collection services to 
recover indebtedness arising under the customs laws and owed 
the United States Government, and the expenses associated with 
recovering such indebtedness, but only after the Customs 
Service has exhausted all administrative efforts, including all 
claims against applicable surety bonds, to collect the 
indebtedness.
          * * * * * * *
                              ----------                              


                         Act of August 5, 1935

AN ACT To protect the revenue of the United States and provide measures 
for the more effective enforcement of the laws respecting the revenue, 
 to prevent smuggling, to authorize customs-enforcement areas, and for 
                            other purposes.

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

                                TITLE I

          * * * * * * *
    [Sec. 7. In addition to any other requirement of law, every 
vessel, not exceeding five hundred net tons, from a foreign 
port or place, or which has visited a hovering vessel, shall 
carry a certificate for the importation into the United States 
of any spirits, wines, or other alcoholic liquors on board 
thereof (sea stores excepted), destined to the United States, 
said certificate to be issued by a consular officer of the 
United States or other authorized person pursuant to such 
regulations as the Secretary of State and the Secretary of the 
Treasury may jointly prescribe. Any spirits, wines, or other 
alcoholic liquors (sea stores excepted) found, or discovered to 
have been, upon any such vessel at any place in the United 
States, or within the customs waters, without said certificate 
on board, which are not shown to have a bona fide destination 
without the United States, shall be seized and forfeited and, 
in the case of any such merchandise so destined to a foreign 
port or place, a bond shall be required in double the amount of 
the duties to which such merchandise would be subject if 
imported into the United States, conditioned upon the delivery 
of said merchandise at such foreign port or place as may be 
certified by a consular officer of the United States or 
otherwise as provided in said regulations: Provided, That if 
the collector shall be satisfied that the certificate required 
for the importation of any spirits, wines, or other alcoholic 
liquors was issued and was lost or mislaid without fraud, or 
was defaced by accident, or is incorrect by reason of clerical 
error or other mistake, said penalties shall not be incurred 
nor shall such bond be required. This section shall take effect 
on the sixtieth day following the enactment of this Act.]
          * * * * * * *

SECTION 13031 OF THE CONSOLIDATED OMNIBUS BUDGET RECONCILIATION ACT OF 
                                  1985

SEC. 13031. FEES FOR CERTAIN CUSTOMS SERVICES.

  (a) Schedule of Fees.--In addition to any other fee 
authorized by law, the Secretary of the Treasury shall charge 
and collect the following fees for the provision of customs 
services in connection with the following:
          (1) * * *
          * * * * * * *
          (5)(A) For fiscal years 1994, 1995, 1996, and 1997, 
        for the arrival of each passenger aboard a commercial 
        vessel or commercial aircraft from a place outside the 
        customs territory of the United States, $6.50.
          (B) For fiscal year 1998 and each fiscal year 
        thereafter, for the arrival of each passenger aboard a 
        commercial vessel or commercial aircraft from a place 
        outside the United States (other than a place referred 
        to in [subsection (b)(1)(A)] subsection (b)(1)(A)(i) of 
        this section), $5.
          * * * * * * *
  [(b) Limitation on Fees.--(1) No fee may be charged under 
subsection (a) of this section for customs services provided in 
connection with--
          [(A) the arrival of any passenger whose journey--
                  [(i) originated in--
                          [(I) Canada,
                          [(II) Mexico,
                          [(III) a territory or possession of 
                        the United States, or
                          [(IV) any adjacent island (within the 
                        meaning of section 101(b)(5) of the 
                        Immigration and Nationality Act (8 
                        U.S.C. 1101(b)(5)), or
                  [(ii) originated in the United States and was 
                limited to--
                          [(I) Canada,
                          [(II) Mexico,
                          [(III) territories and possessions of 
                        the United States, and
                          [(IV) such adjacent islands;
          [(B) the arrival of any railroad car the journey of 
        which originates and terminates in the same country, 
        but only if no passengers board or disembark from the 
        train and no cargo is loaded or unloaded from such car 
        while the car is within any country other than the 
        country in which such car originates and terminates; or
          [(C) the arrival of any ferry.
Subparagraph (A) shall not apply to fiscal years 1994, 1995, 
1996, and 1997.]
    (b) Limitations on Fees.--(1)(A) No fee may be charged 
under subsection (a) of this section for customs services 
provided in connection with--
          (i) the arrival of any passenger whose journey--
                  (I) originated in--
                          (aa) Canada,
                          (bb) Mexico,
                          (cc) a territory or possession of the 
                        United States, or
                          (dd) any adjacent island (within the 
                        meaning of section 101(b)(5) of the 
                        Immigration and Nationality Act (8 
                        U.S.C. 1101(b)(5))), or
                  (II) originated in the United States and was 
                limited to--
                          (aa) Canada,
                          (bb) Mexico,
                          (cc) territories and possessions of 
                        the United States, and
                          (dd) such adjacent islands;
          (ii) the arrival of any railroad car the journey of 
        which originates and terminates in the same country, 
        but only if no passengers board or disembark from the 
        train and no cargo is loaded or unloaded from such car 
        while the car is within any country other than the 
        country in which such car originates and terminates;
          (iii) the arrival of any ferry; or
          (iv) the arrival of any passenger on board a 
        commercial vessel traveling only between ports which 
        are within the customs territory of the United States.
    (B) The exemption provided for in subparagraph (A) shall 
not apply in the case of the arrival of any passenger on board 
a commercial vessel whose journey originates and terminates at 
the same place in the United States if there are no intervening 
stops.
    (C) The exemption provided for in subparagraph (A)(i) shall 
not apply to fiscal years 1994, 1995, 1996, and 1997.
          * * * * * * *
    (4) [No fee](A) No fee may be charged under subsection 
(a)(5) with respect to the arrival any passenger--
          [(A)] (i) who is in transit to a destination outside 
        the customs territory of the United States, and
          [(B)] (ii) for whom customs inspectional services are 
        not provided.
  (B) In the case of a commercial vessel making a single voyage 
involving 2 or more United States ports with respect to which 
the passengers would otherwise be charged a fee pursuant to 
subsection (a)(5), such fee shall be charged only 1 time for 
each passenger.
          * * * * * * *
    (8)(A) * * *
          * * * * * * *
    (D) The fee charged under subsection (a)(9) or (10) with 
respect to the processing of merchandise shall--
          (i) * * *
          * * * * * * *
          (iv) in the case of merchandise classified under 
        [subparagraph 9802.00.80 of such Schedules] heading 
        9802.00.80 of such Schedule, be applied to the full 
        value of the merchandise, less the cost or value of the 
        component United States products; [and]
          (v) in the case of agricultural products of the 
        United States that are processed and packed in a 
        foreign trade zone, be applied only to the value of 
        material used to make the container for such 
        merchandise, if such merchandise is subject to entry 
        and the container is of a kind normally used for 
        packing such merchandise[.]; and
          (vi) in the case of merchandise entered from a 
        foreign trade zone (other than merchandise to which 
        clause (v) applies), be applied only to the value of 
        the privileged or nonprivileged foreign status 
        merchandise under section 3 of the Act of June 18, 1934 
        (commonly known as the Foreign Trade Zones Act, 19 
        U.S.C. 81c).
With respect to merchandise that is classified under subheading 
9802.00.60 or heading 9802.00.80 of such Schedule and is duty-
free, the Secretary may collect the fee charged on the 
processing of the merchandise under subsection (a) (9) or (10) 
on the basis of aggregate data derived from financial and 
manufacturing reports used by the importer in the normal course 
of business, rather than on the basis of entry-by-entry 
accounting.
          * * * * * * *
    (9)(A) With respect to the processing of merchandise that 
is informally entered or released at a centralized hub 
facility, an express consignment carrier facility, or a small 
airport or other facility, the following reimbursements and 
payments are required:
          (i) In the case of a [centralized hub facility or] 
        small airport or other facility--
                  (I) the reimbursement which such facility is 
                required to make during the fiscal year under 
                section 9701 of title 31, United States Code or 
                section 236 of the Trade and Tariff Act of 
                1984; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement under subclause (I).
          (ii) In  the  case  of  an  express  consignment  
        carrier  [facility--] facility or centralized hub 
        facility--
                  (I) an amount, for which the Customs Service 
                shall be reimbursed under section 524 of the 
                Tariff Act of 1930, equal to the cost of the 
                [customs inspectional] services provided by the 
                Customs Service [at the facility] for the 
                facility during the fiscal year; and
                  (II) an annual payment by the facility to the 
                Secretary of the Treasury, which is in lieu of 
                the payment of fees under subsection (a)(10) 
                for such fiscal year, in an amount equal to the 
                reimbursement made under subclause (I).
    (B) For purposes of this paragraph:
          (i) The terms ``centralized hub facility'' and 
        ``express consignment carrier facility'' have the 
        respective meanings that are applied to such terms in 
        part 128 of chapter I of title 19, Code of Federal 
        Regulations[, as in effect on July 30, 1990]. Nothing 
        in this paragraph shall be construed as prohibiting the 
        Secretary of the Treasury from processing merchandise 
        that is informally entered or released at any 
        centralized hub facility or express consignment carrier 
        facility during the normal operating hours of the 
        Customs Service, subject to reimbursement and payment 
        under subparagraph (A).
          (ii) The term ``small airport or other facility'' 
        means any airport or facility to which [section 236 of 
        the Tariff and Trade Act of 1984] section 236 of the 
        Trade and Tariff Act of 1984 applies, if more than 
        25,000 informal entries were cleared through such 
        airport or facility during the preceding fiscal year.
          * * * * * * *
                              ----------                              


                     CUSTOMS AND TRADE ACT OF 1990

          * * * * * * *

                      TITLE III--TARIFF PROVISIONS

          * * * * * * *

                    PART 2--MISCELLANEOUS PROVISIONS

          * * * * * * *

SEC. 484E. FOREIGN REPAIR OF VESSELS.

    (a) * * *
    (b) Effective Date.--The amendment made by this section 
shall apply to--
          (1) * * *
          (2) any entry made--
                  (A) on or after the date of enactment of this 
                Act, and
                  (B) on or before [December 31, 1992] December 
                31, 1994; and
          * * * * * * *

SEC. 484H. CANADIAN LOTTERY MATERIAL.

    (a) * * *
    (b) Effective Date.--The amendments made by this section 
shall apply with respect to articles entered[, or withdrawn 
from warehouse for consumption,] for transportation in bond on 
or after the date that is 15 days after the date of enactment 
of this Act.
          * * * * * * *
                              ----------                              


                 CARIBBEAN BASIN ECONOMIC RECOVERY ACT

          * * * * * * *

SEC. 212. BENEFICIARY COUNTRY.

    (a) * * *
    (b) In designating countries as ``beneficiary countries'' 
under this title the President shall consider only the 
following countries and territories or successor political 
entities:

Anguilla                                    Honduras                    
Antigua and Barbuda                         Jamacia                     
Bahamas, The                                Montserrat                  
Barbados                                    Netherlands Antilles        
Belize                                      Nicaragua                   
Cayman Islands                              Panama                      
Costa Rica                                  Saint Lucia                 
Dominica                                    Saint Vincent and the       
                                             Grenadines                 
Dominican Republic                          Suriname                    
El Salvador                                 Trinidad and Tobago         
Grenada                                     Saint Christopher-Nevis     
Guatermala                                  Turks and Caicos Islands    
Guyana                                      Virgin Island, British      
Haiti                                       ............................
                                                                        

In addition, the President shall not designate any country a 
beneficiary country a beneficiary country under this title--
          (1) * * *
          (7) if such country has not or is not taking steps to 
        afford internationally recognized worker rights (as 
        defined in section [502(a)(4)] 506(4) of the Trade ACt 
        of 1974) to workers in the country (including any 
        designation zone in that country).
Paragraphs (1), (2), (3), (5), and (7) shall not prevent the 
designation of any country as a beneficiary country under this 
Act if the President determines that such designation will be 
in the national economic or security interest of the United 
States and reports such determination to the Congress with his 
reasons therefor.

SEC. 213. ELIGIBLE ARTICLES.

    (a) * * *
          * * * * * * *
    (h)(1) Subject to paragraph (2), the President shall 
proclaim reductions in the rates of duty on handbags, luggage, 
flat goods, work gloves, and the leather wearing apparel that--
          (A) are the product of any beneficiary country; and
          (B) were not designated on August 5, 1983, as 
        eligible articles for purposes of the generalized 
        system of preferences under title V of the Trade Act of 
        1974.
The duty reductions provided for under this paragraph shall not 
apply to textile and apparel articles which are subject to 
textile agreements.
          * * * * * * *
                              ----------                              


                      ANDEAN TRADE PREFERENCE ACT

          * * * * * * *

SEC. 203. BENEFICIARY COUNTRY.

    (a) * * *
          * * * * * * *
    (c) Limitations on Designation.--The President shall not 
designate any country a beneficiary country under this title--
          (1) * * *
          * * * * * * *
          (7) if such country has not or is not taking steps to 
        afford internationally recognized worker rights (as 
        defined in section [502(a)(4)] 506(4) of the Trade Act 
        of 1974) to workers in the country (including any 
        designated zone in that country).
Paragraphs (1), (2), (3), (5), and (7) shall not prevent the 
designation of any country as a beneficiary country under this 
title if the President determines that such designation will be 
in the national economic or security interest of the United 
States and reports such determination to the Congress with his 
reasons therefor.
          * * * * * * *

SEC. 204. ELIGIBLE ARTICLES.

    (a) * * *
          * * * * * * *
    (c) Duty Reductions for Certain Goods.--(1) Subject to 
paragraph (2), the President shall proclaim reductions in the 
rates of duty on handbags, luggage, flat goods, work gloves, 
and leather wearing apparel that--
          (A) are the product of any beneficiary country; and
          (B) were not designated on August 5, 1983, as 
        eligible articles for purposes of the generalized 
        system of preferences under title V of the Trade Act of 
        1974.
The duty reductions provided for under this paragraph shall not 
apply to textile and apparel articles which are subject to 
textile agreements.
          * * * * * * *
                              ----------                              


            HARMONIZED TARIFF SCHEDULE OF THE UNITED STATES

          * * * * * * *

                             GENERAL NOTES

          * * * * * * *
    3. Rates of Duty. The rates of duty in the ``Rates of 
Duty'' columns designated 1 (``General'' and ``Special'') and 2 
of the tariff schedule apply to goods imported into the customs 
territory of the United States as hereinafter provided in this 
note:
          (a) Rate of Duty Column 1.
                  (i) * * *
          * * * * * * *
                  (iv) Products of Insular Possessions.
                          (A) * * *
          * * * * * * *
                          (C) Subject to the limitations 
                        imposed under [sections 503(b) and 
                        504(c)] subsections (a), (c), and (d) 
                        of section 503 of the Trade Act of 
                        1974, goods designated as eligible 
                        under section 503 of such Act which are 
                        imported from an insular possession of 
                        the United States shall receive duty 
                        treatment no less favorable than the 
                        treatment afforded such goods imported 
                        from a beneficiary developing country 
                        under title V of such Act.
          * * * * * * *
    6. Articles Eligible for Duty-Free Treatment Pursuant to 
the Agreement on Trade in Civil Aircraft. Whenever a product is 
entered under a provision for which the rate of duty ``Free 
(C)'' appears in the ``Special'' subcolumn, the importer shall 
file a written or electronic statement, accompanied by such 
supporting documentation as the Secretary of the Treasury may 
require, [with the appropriate customs officer] with the United 
States Customs Service stating that the imported article is a 
civil aircraft or has been imported for use in civil aircraft, 
that it will be so used and that such article has been approved 
for such use by the Administrator of the Federal Aviation 
Administration (FAA) or by the airworthiness authority in the 
country of exportation, if such approval is recognized by the 
FAA as an acceptable substitute for FAA certification, or that 
an application for approval for such use has been submitted to, 
and accepted by, the Administrator of the FAA. For purposes of 
the tariff schedule, the term ``civil aircraft'' means all 
aircraft other than aircraft purchased for use by the 
Department of Defense or the United States Coast Guard.
          * * * * * * *

                     CHAPTER 29--ORGANIC CHEMICALS

          * * * * * * *

----------------------------------------------------------------------------------------------------------------
                                                                               Rates of Duty                    
                                                Units of -------------------------------------------------------
    Heading /      Stat.  Article Description    Quan-                     1                                    
   Subheading     Suffix                          tity   ------------------------------------          2        
                                                              General           Special                         
----------------------------------------------------------------------------------------------------------------
2933 (con.)               Heterocyclic                                                                          
                           compounds with                                                                       
                           nitrogen hetero-                                                                     
                           atom(s) only:                                                                        
                           nucleic acids and                                                                    
                           their salts                                                                          
                           (con.):                                                                              
                             Lactams:                                                                           
2933.71.00            00  6-Hexanelactam (e-                                                                    
                           Caprolactam)......  kg.......  3 cents/ kg +                                         
                                                           9.6%.........  Free (A*, CA, E,                      
                                                                           IL, J, MX).......  15.4 cents/ kg +  
                                                                                               40%              
                                                                                                                
                             *        *        *        *        *        *        *                            
2933.90.02            00  2-[4-[(6-Chloro- 2-                                                                   
                           quinoxalinyl)-                                                                       
                           oxy]- pheno-                                                                         
                           xylpropionic acid,                                                                   
                           ethyl ester                                                                          
                           [(Quizalofop                                                                         
                           ethyl)]; and                                                                         
                          O,O-Dimethyl- S -                                                                     
                           [(4-oxo- 1,2,3-                                                                      
                           benzotriazin- 3-                                                                     
                           (4H)-yl)- methyl]-                                                                   
                           phosph-                                                                              
                           orodithioate......  kg.......  Free..........                      15.4 cents/ kg +  
                                                                                               64.5%            
                                                                                              Free              
----------------------------------------------------------------------------------------------------------------

          * * * * * * *

CHAPTER 99--TEMPORARY LEGISLATION; TEMPORARY MODIFICATIONS ESTABLISHED 
     PURSUANT TO TRADE LEGISLATION; ADDITIONAL IMPORT RESTRICTIONS 
ESTABLISHED PURSUANT TO SECTION 22 OF THE AGRICULTURAL ADJUSTMENT ACT, 
                               AS AMENDED

          * * * * * * *

          Subchapter II--Temporary Reductions in Rates of Duty

          * * * * * * *

----------------------------------------------------------------------------------------------------------------
                                                            Rates of Duty                                       
                                        ----------------------------------------------------                    
     Heading/       Article Description                  1                                     Effective Period 
    Subheading                          ----------------------------------         2                            
                                            General          Special                                            
----------------------------------------------------------------------------------------------------------------
9902.07.10         Carrots, frozen                                                                              
                    (provided for in                                                                            
                    subheading                                                                                  
                    0710.80.70)........  2.2 cents/ kg  No change........  No change.......  On or before 12/31/
                                                                                              92                
----------------------------------------------------------------------------------------------------------------

          * * * * * * *

9902.98.05         Any of the                                                                                   
                    following articles                                                                          
                    not intended for                                                                            
                    sale or                                                                                     
                    distribution to                                                                             
                    the public:                                                                                 
                    personal effects                                                                            
                    of aliens who are                                                                           
                    participants in,                                                                            
                    officials of, or                                                                            
                    accredited members                                                                          
                    of delegations to,                                                                          
                    the 1998 Goodwill                                                                           
                    Games, and of                                                                               
                    persons who are                                                                             
                    immediate family                                                                            
                    members of or                                                                               
                    servants to any of                                                                          
                    the foregoing                                                                               
                    persons; equipment                                                                          
                    and materials                                                                               
                    imported in                                                                                 
                    connection with                                                                             
                    the foregoing                                                                               
                    event by or on                                                                              
                    behalf of the                                                                               
                    foregoing persons                                                                           
                    or the organizing                                                                           
                    committee of such                                                                           
                    event; articles to                                                                          
                    be used in                                                                                  
                    exhibitions                                                                                 
                    depicting the                                                                               
                    culture of a                                                                                
                    country                                                                                     
                    participating in                                                                            
                    such event; and,                                                                            
                    if consistent with                                                                          
                    the foregoing,                                                                              
                    such other                                                                                  
                    articles as the                                                                             
                    Secretary of the                                                                            
                    Treasury may allow  Free...........  No change.......  Free............  On or before 2/1/99
                                                                                                                

          * * * * * * *
                              ----------                              


                           TRADE ACT OF 1974

                            TABLE OF CONTENTS

     * * * * * * *

        TITLE II--RELIEF FROM INJURY CAUSED BY IMPORT COMPETITION

     * * * * * * *

       Part II--Training, Other Employment Services And Allowances

Sec. 235.  Employment services.
     * * * * * * *
[Sec. 238.  Relocation allowances.]
     * * * * * * *

               [TITLE V--GENERALIZED SYSTEM OF PREFERENCES

[Sec. 501.  Authority to extend preferences.
[Sec. 502.  Beneficiary developing country.
[Sec. 503.  Eligible articles.
[Sec. 504.  Limitations on preferential treatment.
[Sec. 505.  Termination of duty-free treatment and reports.
[Sec. 506.  Agricultural exports of beneficiary developing countries.]

               TITLE V--GENERALIZED SYSTEM OF PREFERENCES

Sec. 501. Authority to extend preferences.
Sec. 502. Designation of beneficiary developing countries.
Sec. 503. Designation of eligible articles.
Sec. 504. Review and reports to Congress.
Sec. 505. Date of termination.
Sec. 506. Definitions.
          * * * * * * *

       TITLE II--RELIEF FROM INJURY CAUSED BY IMPORT COMPETITION

          * * * * * * *

                     Subchapter B--Program Benefits

                 PART I--TRADE READJUSTMENT ALLOWANCES

SEC. 231. QUALIFYING REQUIREMENTS FOR WORKERS.

    (a) * * *
          * * * * * * *
    (c)(1)(A) If the Secretary finds that [it is not feasible 
or appropriate to approve a training program] a training 
program is not available for a worker under section 236(a), the 
Secretary shall submit to such worker a written statement 
certifying such finding.
    (B) If a State or State agency has an agreement with the 
Secretary under section 239 and the State or State agency finds 
that [it is not feasible or appropriate to approve a training 
program] a training program is not available for a worker 
pursuant to the requirements of section 236(a), the State or 
State agency shall--
            (i) submit to such worker a written statement 
        certifying such finding, and
            (ii) submit to the Secretary a written statement 
        certifying such finding and the reasons for such 
        finding.
    (2)(A) If, after submitting to a worker a written statement 
certified under paragraph (1)(A), the Secretary finds that [it 
is feasible or appropriate to approve a training program] a 
training program is available for such worker under section 
236(a), the Secretary shall submit to such worker a written 
statement that revokes the certification made under paragraph 
(1)(A) with respect to such worker.
    (B) If, after submitting to a worker a written statement 
certified under paragraph (1)(B), a State or State agency finds 
that [it is feasible or appropriate to approve a training 
program] a training program is available for such worker 
pursuant to the requirements of section 236(a), the State or 
State agency shall submit to such worker, and to the Secretary, 
a written statement that revokes the certification made under 
paragraph (1)(B) with respect to such worker.
          * * * * * * *

SEC. 233. LIMITATIONS ON TRADE READJUSTMENT ALLOWANCES.

    (a) * * *
    [(b) A trade readjustment allowance may not be paid for an 
trade readjustment allowance may not be paid for an additional 
week specified in subsection (a)(3) if the adversely affected 
worker who would receive such allowance did not make a bona 
fide application to a training program approved by the 
Secretary under section 236 within 210 days after the date of 
the worker's first certification of eligibility to apply for 
adjustment assistance issued by the Secretary, or, if later, 
within 210 days after the date of the worker's total or partial 
separation referred to in section 231(a)(1).]
          * * * * * * *

      Part II--Training, Other Employment Services, and Allowances

          * * * * * * *

[SEC. 238. RELOCATION ALLOWANCES.

    [(a) Any adversely affected worker covered by a 
certification under subchapter A of this chapter may file an 
application with the Secretary for a relocation allowance, 
subject to the terms and conditions of this section, if such 
worker files such application before--
            [(1) the later of--
                    [(A) the 425th day after the date of the 
                certification, or
                    [(B) the 425th day after the date of the 
                worker's last total separation; or
            [(2) the 182d day after the concluding date of any 
        training received by such worker, if the worker was 
        referred to such training by the Secretary.
    [(b) A relocation allowance may be granted only to assist 
an adversely affected worker in relocating within the United 
States and only if the Secretary determines that such worker 
cannot reasonably be expected to secure suitable employment in 
the commuting area in which he resides and that such worker--
            [(1) has obtained suitable employment affording a 
        reasonable expectation of long-term duration in the 
        area in which he wishes to relocate, or
            [(2) has obtained a bona fide offer of such 
        employment, and
            [(3) is totally separated from employment at the 
        time relocation commences.
    [(c) A relocation allowance shall not be granted to such 
worker unless his relocation occurs within 182 days after the 
filing of the application therefor or (in the case of a worker 
who has been referred to training by the Secretary) within 182 
days after the conclusion of such training.
    [(d) For the purposes of this section, the term 
``relocation allowance'' means--
            [(1) 90 percent of the reasonable and necessary 
        expenses (including, but not limited to, subsistence 
        and transportation expenses at levels not exceeding 
        those allowable under section 236(b) (1) and (2)) 
        specified in regulations prescribed by the Secretary, 
        incurred in transporting a worker and his family if 
        any, and household effects, and
            [(2) a lump sum equivalent to three times the 
        worker's average weekly wage, up to a maximum payment 
        of $800.]
          * * * * * * *

              CHAPTER 2--ADJUSTMENT ASSISTANCE FOR WORKERS

          * * * * * * *

                    Subchapter C--General Provisions

          * * * * * * *

SEC. 245. AUTHORIZATION OF APPROPRIATIONS.

    (a) In General.--There are authorized to be appropriated to 
the Department of Labor, for each of the fiscal years 1993, 
1994, 1995, 1996, 1997, [and 1998] 1998, 1999, and 2000, such 
sums as may be necessary to carry out the purposes of this 
chapter, other than subchapter D.
          * * * * * * *

               CHAPTER 3--ADJUSTMENT ASSISTANCE FOR FIRMS

          * * * * * * *

SEC. 256. DELEGATION OF FUNCTIONS TO SMALL BUSINESS ADMINISTRATION; 
                    AUTHORIZATION OF APPROPRIATIONS.

    (a) * * *
    (b) There are hereby authorized to be appropriated to the 
Secretary for fiscal years 1993, 1994, 1995, 1996, 1997, [and 
1998] 1998, 1999, and 2000 such sums as may be necessary to 
carry out his functions under this chapter in connection with 
furnishing adjustment assistance to firms (including, but not 
limited to, the payment of principal, interest, and reasonable 
costs incident to default on loans guaranteed by the Secretary 
under the authority of this chapter), which sums are authorized 
to be appropriated to remain available until expended.
          * * * * * * *

     Subchapter D--NAFTA Transitional Adjustment Assistance Program

SEC. 250. ESTABLISHMENT OF TRANSITIONAL PROGRAM.

    (a) * * *
          * * * * * * *
    (d) Comprehensive Assistance.--Workers covered by 
certification issued by the Secretary under subsection (c) 
shall be provided, in the same manner and to the same extent as 
workers covered under a certification under subchapter A, the 
following:
            (1) Employment services described in section 235.
            (2) Training described in section 236, except that 
        notwithstanding the provisions of section 236(a)(2)(A), 
        the total amount of payments for training under this 
        subchapter for any fiscal year shall not exceed 
        $30,000,000.
            (3) Trade readjustment allowances described in 
        sections 231 through 234, except that--
                    (A) the provisions of sections 231(a)(5)(C) 
                and 231(c), authorizing the payment of trade 
                readjustment allowances upon a finding that [it 
                is not feasible or appropriate to approve a 
                training program] a training program is not 
                available for a worker, shall not be applicable 
                to payment of such allowances under this 
                subchapter; and
                    (B) [notwithstanding the provisions of 
                section 233(b),] in order for a worker to 
                qualify for trade readjustment allowances under 
                this subchapter, the worker shall be enrolled 
                in a training program approved by the Secretary 
                under section 236(a) by the later of--
                            (i) the last day of the 16th week 
                        of such worker's initial unemployment 
                        compensation benefit period, or
                            (ii) the last day of the 6th week 
                        after the week in which the Secretary 
                        issues a certification covering such 
                        worker.
        In cases of extenuating circumstances relating to 
        enrollment in a training program, the Secretary may 
        extend the time for enrollment for a period not to 
        exceed 30 days.
            (4) Job search allowances described in section 237.
            [(5) Relocation allowances described in section 
        238.]
          * * * * * * *

                  CHAPTER 5--MISCELLANEOUS PROVISIONS

          * * * * * * *

SEC. 285. TERMINATION.

    (a) * * *
          * * * * * * *
    (c)(1) Except as provided in paragraph (2), no assistance, 
vouchers, allowances, or other payments may be provided under 
chapter 2, and no technical assistance may be provided under 
chapter 3, after September 30, [1998] 2000.
    [(2)(A) Except as provided in subparagraph (B), no 
assistance, vouchers, allowances, or other payments may be 
provided under subchapter D of chapter 2 after the day that is 
the earlier of--
            [(i) September 30, 1998, or
            [(ii) the date on which legislation, establishing a 
        program providing dislocated workers with comprehensive 
        assistance substantially similar to the assistance 
        provided by such subchapter D, becomes effective.
    [(B) Notwithstanding subparagraph (A), if, on or before the 
day described in subparagraph (A), a worker--
            [(i) is certified as eligible to apply for 
        assistance, under subchapter D of chapter 2; and
            [(ii) is otherwise eligible to receive assistance 
        in accordance with section 250,
such worker shall continue to be eligible to receive such 
assistance for any week for which the worker meets the 
eligibility requirements of such section.]
    (2) No assistance, vouchers, allowances, or other payments 
may be provided under subchapter D of chapter 2 after September 
30, 1998.
          * * * * * * *

             TITLE III--RELIEF FROM UNFAIR TRADE PRACTICES

 CHAPTER 1--ENFORCEMENT OF UNITED STATES RIGHTS UNDER TRADE AGREEMENTS 
            AND RESPONSE TO CERTAIN FOREIGN TRADE PRACTICES

SEC. 301. ACTIONS BY UNITED STATES TRADE REPRESENTATIVE.

  (a) * * *
          * * * * * * *
  (c) Scope of Authority.--
          (1) * * *
          * * * * * * *
          (4) Any trade agreement described in paragraph 
        [(1)(C)(iii)] (1)(D)(iii) shall provide compensatory 
        trade benefits that benefit the economic sector which 
        includes the domestic industry that would benefit from 
        the elimination of the act, policy, or practice that is 
        the subject of the action to be taken under subsection 
        (a) or (b), or benefit the economic sector as closely 
        related as possible to such economic sector, unless--
                  (A) the provision of such trade benefits is 
                not feasible, or
                  (B) trade benefits that benefit any other 
                economic sector would be more satisfactory than 
                such trade benefits.
          * * * * * * *

SEC. 310. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

  (a) Identification.--
          (1) Within 180 days after the submission in [calendar 
        year 1995] each of calendar years 1995 through 2000 of 
        the report required by section 181(b), the Trade 
        Representative shall--
                  (A) * * *
          * * * * * * *

              [TITLE V--GENERALIZED SYSTEM OF PREFERENCES

[SEC. 501. AUTHORITY TO EXTEND PREFERENCE.

  [The President may provide duty-free treatment for any 
eligible article from any beneficiary developing country in 
accordance with the provisions of this title. In taking any 
such action, the President shall have due regard for--
          [(1) the effect such action will have on furthering 
        the economic development of developing countries 
        through the expansion of their exports;
          [(2) the extent to which other major developed 
        countries are undertaking a comparable effort to assist 
        developing countries by granting generalized 
        preferences with respect to imports of products of such 
        countries;
          [(3) the anticipated impact of such action on United 
        States producers of like or directly competitive 
        products; and
          [(4) the extent of the beneficiary developing 
        country's competitiveness with respect to eligible 
        articles.

[SEC. 502. BENEFICIARY DEVELOPING COUNTRY.

  [(a)(1) For purposes of this title, the term ``beneficiary 
developing country'' means any country with respect to which 
there is in effect an Executive order or Presidential 
proclamation by the President of the United States designating 
such country as a beneficiary developing country for purposes 
of this title. Before the President designates any country as a 
beneficiary developing country for purposes of this title, he 
shall notify the House of Representatives and the Senate of his 
intention to make such designation, together with the 
considerations entering into such decision.
  [(2) If the President has designated any country as a 
beneficiary developing country for purposes of this title, he 
shall not terminate such designation (either by issuing an 
Executive order or Presidential proclamation for that purpose 
or by issuing an Executive order or Presidential proclamation 
which has the effect of terminating such designation) unless, 
at least 60 days before such termination, he has notified the 
House of Representatives and the Senate and has notified such 
country of his intention to terminate such designation, 
together with the consideration entering into such decision.
  [(3) For purposes of this title, the term ``country'' means 
any foreign country, any overseas dependent territory or 
possession of a foreign country, or the Trust Territory of the 
Pacific Islands. In the case of an association of countries 
which is a free trade area or customs union, or which is 
contributing to comprehensive regional economic integration 
among its members through appropriate means, including, but not 
limited to, the reduction of duties, the President may by 
Executive order or Presidential proclamation provide that all 
members of such association other than members which are barred 
from designation under subsection (b) shall be treated as one 
country for purposes of this title.
  [(4) For purposes of this title, the term ``internationally 
recognized worker rights'' includes--
          [(A) the right of association;
          [(B) the right to organize and bargain collectively;
          [(C) a prohibition on the use of any form of forced 
        or compulsory labor;
          [(D) a minimum age for the employment of children; 
        and
          [(E) acceptable conditions of work with respect to 
        minimum wages, hours of work, and occupational safety 
        and health.
  [(b) No designation shall be made under this section with 
respect to any of the following:


[Australia                                  Japan                       
Austria                                     Monaco                      
Canada                                      New Zealand                 
European Economic Community                 Norway                      
  member states                             Sweden                      
Finland                                     Switzerland                 
Iceland                                                                 
                                                                        


In addition, the President shall not designate any country a 
beneficiary developing country under this section--
          [(1) if such country is a Communist country, unless 
        (A) the products of such country receive 
        nondiscriminatory treatment, (B) such country is a 
        contracting party to the General Agreement on Tariffs 
        and Trade and a member of the International Monetary 
        Fund, and (C) such country is not dominated or 
        controlled by international communism;
          [(2) if such country is a member of the Organization 
        of Petroleum Exporting Countries, or a party to any 
        other arrangement of foreign countries, and such 
        country participates in any action pursuant to such 
        arrangement the effect of which is to withhold supplies 
        of vital commodity resources from international trade 
        or to raise the price of such commodities to an 
        unreasonable level and to cause serious disruption of 
        the world economy;
          [(3) if such country affords preferential treatment 
        to the products of a developed country, other than the 
        United States, which has, or is likely to have, a 
        significant adverse effect on United States commerce, 
        unless the President has received assurances 
        satisfactory to him that such preferential treatment 
        will be eliminated before January 1, 1976, or that 
        action will be taken before January 1, 1976, to assure 
        that there will be no such significant adverse effect, 
        and he reports those assurances to the Congress;
          [(4) if such country--
                  [(A) has nationalized, expropriated, or 
                otherwise seized ownership or control of 
                property, including patents, trademarks, or 
                copyrights owned by a United States citizen or 
                by a corporation, partnership, or association 
                which is 50 percent or more beneficially owned 
                by United States citizens,
                  [(B) has taken steps to repudiate or nullify 
                an existing contract or agreement with a United 
                States citizen or a corporation, partnership, 
                or association which is 50 percent or more 
                beneficially owned by United States citizens, 
                the effect of which is to nationalize, 
                expropriate, or otherwise seize ownership or 
                control of property, including patents, 
                trademarks, or copyrights, so owned, or
                  [(C) has imposed or enforced taxes or other 
                exactions, restrictive maintenance or 
                operational conditions, or other measures with 
                respect to property, including patents, 
                trademarks, or copyrights, so owned, the effect 
                of which is to nationalize, expropriate, or 
                otherwise seize ownership or control of such 
                property,
                  [(D) the President determines that--
                          [(i) prompt, adequate, and effective 
                        compensation has been or is being made 
                        to such citizen, corporation, 
                        partnership, or association,
                          [(ii) good faith negotiations to 
                        provide prompt, adequate, and effective 
                        compensation under the applicable 
                        provisions of international law are in 
                        progress, or such country is otherwise 
                        taking steps to discharge its 
                        obligations under international law 
                        with respect to such citizen, 
                        corporation, partnership, or 
                        association, or
                          [(iii) a dispute involving such 
                        citizen, corporation, partnership, or 
                        association over compensation for such 
                        a seizure has been submitted to 
                        arbitration under the provisions of the 
                        Convention for the Settlement of 
                        Investment Disputes, or in another 
                        mutually agreed upon forum, and
        promptly furnishes a copy of such determination to the 
        Senate and House of Representatives;
          [(5) if such country fails to act in good faith in 
        recognizing as binding or in enforcing arbitral awards 
        in favor of United States citizens or a corporation, 
        partnership, or association which is 50 percent or more 
        beneficially owned by United States citizens, which 
        have been made by arbitrators appointed for each case 
        or by permanent arbitral bodies to which the parties 
        involved have submitted their dispute;
          [(6) if such country aids or abets, by granting 
        sanctuary from prosecution to, any individual or group 
        which has committed an act of international terrorism; 
        and
          [(7) if such country has not taken or is not taking 
        steps to afford internationally recognized worker 
        rights to workers in the country (including any 
        designated zone in that country).
  [Paragraphs (4), (6), (7), and (8) shall not prevent the 
designation of any country as a beneficiary developing country 
under this section if the President determines that such 
designation will be in the national economic interest of the 
United States and reports such determination to the Congress 
with his reasons therefor.
  [(c) In determining whether to designate any country a 
beneficiary developing country under this section, the 
President shall take into account--
          [(1) an expression by such country of its desire to 
        be so designated;
          [(2) the level of economic development of such 
        country, including its per capita gross national 
        product, the living standards of its inhabitants, and 
        any other economic factors which he deems appropriate;
          [(3) whether or not the other major developed 
        countries are extending generalized preferential tariff 
        treatment to such country;
          [(4) the extent to which such country has assured the 
        United States it will provide equitable and reasonable 
        access to the markets and basic commodity resources of 
        such country and the extent to which such country has 
        assured the United States that it will refrain from 
        engaging in unreasonable export practices;
          [(5) the extent to which such country is providing 
        adequate and effective means under its laws for foreign 
        nationals to secure, to exercise, and to enforce 
        exclusive rights in intellectual property, including 
        patents, trademarks, and copyrights;
          [(6) the extent to which such country has taken 
        action to--
                  [(A) reduce trade distorting investment 
                practices and policies (including export 
                performance requirements); and
                  [(B) reduce or eliminate barriers to trade in 
                services; and
          [(7) whether or not such country has taken or is 
        taking steps to afford to workers in that country 
        (including any designated zone in that country) 
        internationally recognized worker rights.
    [(d) Amendment of general headnote 3(a) to the Tariff 
Schedules of the United States relating to products of insular 
possessions.
  [(e)(1) The President may exempt from the application of 
paragraph (2) of subsection (b) any country during the period 
during which such country (A) is a party to a bilateral or 
multilateral trade agreement to which the United States is also 
a party if such agreement fulfills the negotiating objectives 
set forth in section 108 of assuring the United States fair and 
equitable access at reasonable prices to supplies of articles 
of commerce important to the economic requirements of the 
United States and (B) is not in violation of such agreement by 
action denying the United States such fair and equitable 
access.
  [(2) The President may exempt from the application of 
paragraph (2) of subsection (b) any country that enters into a 
bilateral product-specific trade agreement with the United 
States under section 101 or 102 of the Trade Act of 1974 before 
January 3, 1980. The President shall terminate the exemption 
granted to any country under the preceding sentence if that 
country interrupts or terminates the delivery of supplies of 
petroleum and petroleum products to the United States.

[SEC. 503. ELIGIBLE ARTICLES.

  [(a) The President shall, from time to time, publish and 
furnish the International Trade Commission with lists of 
articles which may be considered for designation as eligible 
articles for purposes of this title. Before any such list is 
furnished to the Commission, there shall be in effect an 
Executive order or Presidential proclamation under section 502 
designating beneficiary developing countries. The provisions of 
sections 131, 132, 133, and 134 of this Act shall be complied 
with as though action under section 501 were action under 
section 101 of this Act to carry out a trade agreement entered 
into under section 101. After receiving the advice of the 
Commission with respect to the listed articles, the President 
shall designate those articles he considers appropriate to be 
eligible articles for purposes of this title by Executive order 
or Presidential proclamation.
  [(b)(1) The duty free treatment provided under section 501 
shall apply to any eligible article which is the growth, 
product, or manufacture of a beneficiary developing country 
if--
          [(A) that article is imported directly from a 
        beneficiary developing country into the customs 
        territory of the United States;
          [(B) the sum of (i) the cost or value of the 
        materials produced in the beneficiary developing 
        country or any 2 or more countries which are members of 
        the same association of countries which is treated as 
        one country under section 502(a)(3), plus (ii) the 
        direct costs of processing operations performed in such 
        beneficiary developing country or such member countries 
        is not less than 35 percent of the appraised value of 
        such article at the time of its entry into the customs 
        territory of the United States.
  [(2) The Secretary of the Treasury, after consulting with the 
United States Trade Representative, shall prescribe such 
regulations as may be necessary to carry out this subsection, 
including, but not limited to, regulations providing that, in 
order to be eligible for duty-free treatment under this title, 
an article must be wholly the growth, product, or manufacture 
of a beneficiary developing country, or must be a new or 
different article of commerce which has been grown, produced, 
or manufactured in the beneficiary developing country; but no 
article or material of a beneficiary developing country shall 
be eligible for such treatment by virtue of having merely 
undergone--
          [(A) simple combining or packaging operations, or
          [(B) mere dilution with water or mere dilution with 
        another substance that does not materially alter the 
        characteristics of the article.
  [(c)(1) The President may not designate any article as an 
eligible article under subsection (a) if such article is within 
one of the following categories of import-sensitive articles--
          [(A) textile and apparel articles which are subject 
        to textile agreements,
          [(B) watches, except those watches entered after June 
        30, 1989, that the President specifically determines, 
        after public notice and comment, will not cause 
        material injury to watch or watch band, strap, or 
        bracelet manufacturing and assembly operations in the 
        United States or the United States insular possessions,
          [(C) import-sensitive electronic articles,
          [(D) import-sensitive steel articles,
          [(E) footwear, handbags, luggage, flat goods, work 
        gloves, and leather wearing apparel which were not 
        eligible articles for purposes of this article on April 
        1, 1984,
          [(F) import-sensitive semimanufactured and 
        manufactured glass products, and
          [(G) any other articles which the President 
        determines to be import-sensitive in the context of the 
        Generalized System of Preferences.
  [(2) No article shall be an eligible article for purposes of 
this title for any period during which such article is the 
subject of any action proclaimed pursuant to section 203 of 
this Act or section 232 or 351 of the Trade Expansion Act of 
1962.
  [(d) Tariff-Rate Quotas.--No quantity of an agricultural 
product subject to a tariff-rate quota that exceeds the in-
quota quantity shall be eligible for duty-free treatment under 
this title.

[SEC. 504. LIMITATIONS ON PREFERENTIAL TREATMENT.

  [(a)(1) The President may withdraw, suspend, or limit the 
application of the duty-free treatment accorded under section 
501 with respect to any article or with respect to any country; 
except that no rate of duty may be established in respect of 
any article pursuant to this section other than the rate which 
would apply but for this title. In taking any action under this 
subsection, the President shall consider the factors set forth 
in sections 502 and 502(c).
  [(2) The President shall, as necessary, advise the Congress 
and, by no later than January 4, 1988, submit to the Congress a 
report on the application of sections 501 and 502(c), and the 
actions the President has taken to withdraw, to suspend, or to 
limit the application of duty-free treatment with respect to 
any country which has failed to adequately take the actions 
described in section 502(c).
  [(b) The President shall, after complying with the 
requirements of section 502(a)(2), withdraw or suspend the 
designation of any country as a beneficiary developing country 
if, after such designation, he determines that as the result of 
changed circumstances such country would be barred from 
designation as a beneficiary developing country under section 
502(b). Such country shall cease to be a beneficiary developing 
country on the day on which the President issues an Executive 
order or Presidential proclamation revoking his designation of 
such country under section 502.
  [(c)(1) Subject to paragraphs (2) through (7) and subsection 
(d), whenever the President determines that any country--
          [(A) has exported (directly or indirectly) to the 
        United States during a calendar year a quantity of an 
        eligible article having an appraised value in excess of 
        an amount which bears the same ratio to $25,000,000 as 
        the gross national product of the United States for the 
        preceding calendar year (as determined by the 
        Department of Commerce) bears to the gross national 
        product of the United States for calendar year 1974; or
          [(B) has exported (either directly or indirectly) to 
        the United States a quantity of any eligible article 
        equal to or exceeding 50 percent of the appraised value 
        of the total imports of such article into the United 
        States during any calendar year;
then, not later than July 1 of the next calendar year, such 
country shall not be treated as a beneficiary developing 
country with respect to such article.
  [(2)(A) Not later than January 1, 1987, and periodically 
thereafter, the President shall conduct a general review of 
eligible articles based on the considerations described in 
section 501 or 502(c).
  [(B) If, after any review under subparagraph (A), the 
President determines that this subparagraph should apply 
because a beneficiary developing country has demonstrated a 
sufficient degree of competitiveness (relative to other 
beneficiary developing countries) with respect to any eligible 
article, then paragraph (1) shall be applied to such country 
with respect to such article by substituting--
          [(i) ``1984'' for ``1974'' in subparagraph (A), and
          [(ii) ``25 percent'' for ``50 percent'' in 
        subparagraph (B).
  [(3)(A) Not earlier than January 4, 1987, the President may 
waive the application of this subsection with respect to any 
eligible article of any beneficiary developing country if, 
before July 1 of the calendar year beginning after the calendar 
year for which a determination described in paragraph (1) was 
made with respect to such eligible article, the President--
          [(i) receives the advice of the International Trade 
        Commission on whether any industry in the United States 
        is likely to be adversely affected by such waiver,
          [(ii) determines, based on the considerations 
        described in sections 501 and 502(c) and the advice 
        described in clause (i), that such waiver is in the 
        national economic interest of the United States, and
          [(iii) publishes the determination described in 
        clause (ii) in the Federal Register.
  [(B) In making any determination under subparagraph (A), the 
President shall give great weight to--
          [(i) the extent to which the beneficiary developing 
        country has assured the United States that such country 
        will provide equitable and reasonable access to the 
        markets and basic commodity resources of such country, 
        and
          [(ii) the extent to which such country provides 
        adequate and effective means under its law for foreign 
        nationals to secure, to exercise, and to enforce 
        exclusive rights in intellectual property, including 
        patent, trademark, and copyright rights.
  [(C) Any waiver granted pursuant to this paragraph shall 
remain in effect until the President determines that such 
waiver is no longer warranted due to changed circumstances.
  [(D)(i) The President may not exercise the waiver authority 
provided under subparagraph (A) with respect to a quantity of 
eligible articles entered in any calendar year which exceeds an 
aggregate value equal to 30 percent of the total value of all 
articles which entered duty-free under this title during the 
preceding calendar year.
  [(ii) The President may not exercise the waiver authority 
provided under subparagraph (A) with respect to a quantity of 
eligible articles entered during any calendar year beginning 
after 1986 the aggregate value of which exceeds 15 percent of 
the total value of all articles that have entered duty-free 
under this title during the preceding calendar year from those 
beneficiary developing countries which for the preceding 
calendar year--
          [(I) had a per capita gross national product 
        (calculated on the basis of the best available 
        information, including that of the World Bank) of 
        $5,000 or more; or
          [(II) had exported (either directly or indirectly) to 
        the United States a quantity of articles that was duty-
        free under this title that had an appraised value of 
        more than 10 percent of the total imports of all 
        articles that entered duty-free under this title during 
        that year.
  [(iii) There shall be counted against the limitations imposed 
under clauses (i) and (ii) for any calendar year only that 
quantity of any eligible article of any country that--
          [(I) entered duty-free under this title during such 
        calendar year; and
          [(II) is in excess of the quantity of that article 
        that would have been so entered during such calendar 
        year if the 1974 limitation applied under paragraph 
        (1)(A) and the 50 percent limitation applied under 
        paragraph (1)(B).
  [(4) Except in any case to which paragraph (2)(B) applies, 
the President may waive the application of this subsection if, 
before July 1 of the calendar year beginning after the calendar 
year for which a determination described in paragraph (1) was 
made, the President determines and publishes in the Federal 
Register that, with respect to such country--
          [(A) there has been a historical preferential trade 
        relationship between the United States and such 
        country,
          [(B) there is a treaty or trade agreement in force 
        covering economic relations between such country and 
        the United States, and
          [(C) such country does not discriminate against, or 
        impose unjustifiable or unreasonable barriers to, 
        United States commerce.
  [(5) A country which is no longer treated as a beneficiary 
developing country with respect to an eligible article by 
reason of this subsection may be redesignated a beneficiary 
developing country with respect to such article, subject to the 
provisions of sections 501 and 502, if imports of such article 
from such country did not exceed the limitations in paragraph 
(1) (after application of paragraph (2)) during the preceding 
calendar year.
  [(6)(A) This subsection shall not apply to any beneficiary 
developing country which the President determines, based on the 
considerations described in sections 501 and 502(c), to be a 
least-developed beneficiary developing country.
  [(B) The President shall--
          [(i) make a determination under subparagraph (A) with 
        respect to each beneficiary developing country before 
        July 4, 1985, and periodically thereafter, and
          [(ii) notify the Congress at least 60 days before any 
        such determination becomes final.
  [(7) For purposes of this subsection, the term ``country'' 
does not include an association of countries which is treated 
as one country under section 502(a)(3), but does include a 
country which is a member of any such association.
  [(d)(1) Subsection (c)(1)(B) (after application of subsection 
(c)(2)) shall not apply with respect to any eligible article if 
a like or directly competitive article is not produced in the 
United States on January 3, 1985.
  [(2) The President may disregard subsection (c)(1)(B) with 
respect to any eligible article if the appraised value of the 
total imports of such article into the United States during the 
preceding calendar year is not in excess of an amount which 
bears the same ratio to $5,000,000 as the gross national 
product of the United States for that calendar year (as 
determined by the Department of Commerce) bears to the gross 
national product of the United States for calendar year 1979.
  [(e) No action pursuant to section 501 may affect any tariff 
duty imposed by the Legislature of Puerto Rico pursuant to 
section 319 of the Tariff Act of 1930 (19 U.S.C. sec. 1319) on 
coffee imported into Puerto Rico.
  [(f)(1) If the President determines that the per capita gross 
national product (calculated on the basis of the best available 
information, including that of the World Bank) of any 
beneficiary developing country for any calendar year (hereafter 
in this subsection referred to as the ``determination year'') 
after 1984, exceeds the applicable limit for the determination 
year--
          [(A) subsection (c)(1)(B) shall be applied for the 2-
        year period beginning on July 1 of the calendar year 
        succeeding the determination year by substituting ``25 
        percent'' or ``50 percent'', and
          [(B) such country shall not be treated as a 
        beneficiary developing country under this title after 
        the close of such 2-year period.
  [(2)(A) For purposes of this subsection, the term 
``applicable limit'' means a sum of--
          [(i) $8,500, plus
          [(ii) 50 percent of the amount determined under 
        subparagraph (B) for the determination year.
  [(B) The amount determined under this subparagraph for the 
determination year is an amount equal to--
          [(i) $8,500, multiplied by
          [(ii) the percentage determined by dividing--
                  [(I) the excess, if any, of the gross 
                national product of the United States (as 
                determined by the Secretary of Commerce) for 
                the determination year over the gross national 
                product of the United States for 1984, by
                  [(II) the gross national product for 1984.

[SEC. 505. TERMINATION OF DUTY-FREE TREATMENT AND REPORTS.

  [(a) No duty-free treatment provided under this title shall 
remain in effect after July 31, 1995.
  [(b) On or before January 4, 1990, the President shall submit 
to the Congress a full and complete report regarding the 
operation of this title.
  [(c) The President shall submit an annual report to the 
Congress on the status of internationally recognized worker 
rights within each beneficiary developing country.

[SEC. 506. AGRICULTURAL EXPORTS OF BENEFICIARY DEVELOPING COUNTRIES.

  [The appropriate agencies of the United States shall assist 
beneficiary developing countries to develop and implement 
measures designed to assure that the agricultural sectors of 
their economies are not directed to export markets to the 
detriment of the production of foodstuffs for their citizenry.]

               TITLE V--GENERALIZED SYSTEM OF PREFERENCES

SEC. 501. AUTHORITY TO EXTEND PREFERENCES.

    The President may provide duty-free treatment for any 
eligible article from any beneficiary developing country in 
accordance with the provisions of this title. In taking any 
such action, the President shall have due regard for--
          (1) the effect such action will have on furthering 
        the economic development of developing countries 
        through the expansion of their exports;
          (2) the extent to which other major developed 
        countries are undertaking a comparable effort to assist 
        developing countries by granting generalized 
        preferences with respect to imports of products of such 
        countries;
          (3) the anticipated impact of such action on United 
        States producers of like or directly competitive 
        products; and
          (4) the extent of the beneficiary developing 
        country's competitiveness with respect to eligible 
        articles.

SEC. 502. DESIGNATION OF BENEFICIARY DEVELOPING COUNTRIES.

    (a) Authority To Designate Countries.--
          (1) Beneficiary developing countries.--The President 
        is authorized to designate countries as beneficiary 
        developing countries for purposes of this title, based 
        on the considerations in section 501 and subsection (c) 
        of this section.
          (2) Least-developed beneficiary developing 
        countries.--The President is authorized to designate 
        any beneficiary developing country as a least-developed 
        beneficiary developing country for purposes of this 
        title.
    (b) Countries Ineligible for Country Designation.--
          (1) Specific countries.--The following countries may 
        not be designated as beneficiary developing countries 
        for purposes of this title:
                  (A) Australia.
                  (B) Canada.
                  (C) European Union member states.
                  (D) Iceland.
                  (E) Japan.
                  (F) Monaco.
                  (G) New Zealand.
                  (H) Norway.
                  (I) Switzerland.
          (2) Other bases for ineligibility.--The President 
        shall not designate any country a beneficiary 
        developing country under this title if any of the 
        following applies:
                  (A) Such country is a Communist country, 
                unless--
                          (i) the products of such country 
                        receive nondiscriminatory treatment,
                          (ii) such country is a WTO Member (as 
                        such term is defined in section 2 of 
                        the Uruguay Round Agreements Act,) and 
                        a member of the International Monetary 
                        Fund, and
                          (iii) such country is not dominated 
                        or controlled by international 
                        communism.
                  (B) Such country is a party to an arrangement 
                of countries and participates in any action 
                pursuant to such arrangement, the effect of 
                which is--
                          (i) to withhold supplies of vital 
                        commodity resources from international 
                        trade or to raise the price of such 
                        commodities to an unreasonable level, 
                        and
                          (ii) to cause serious disruption of 
                        the world economy.
                  (C) Such country affords preferential 
                treatment to the products of a developed 
                country, other than the United States, which 
                has, or is likely to have, a significant 
                adverse effect on United States commerce.
                  (D)(i) Such country--
                          (I) has nationalized, expropriated, 
                        or otherwise seized ownership or 
                        control of property, including patents, 
                        trademarks, or copyrights, owned by a 
                        United States citizen or by a 
                        corporation, partnership, or 
                        association which is 50 percent or more 
                        beneficially owned by United States 
                        citizens,
                          (II) has taken steps to repudiate or 
                        nullify an existing contract or 
                        agreement with a United States citizen 
                        or a corporation, partnership, or 
                        association which is 50 percent or more 
                        beneficially owned by United States 
                        citizens, the effect of which is to 
                        nationalize, expropriate, or otherwise 
                        seize ownership or control of property, 
                        including patents, trademarks, or 
                        copyrights, so owned, or
                          (III) has imposed or enforced taxes 
                        or other exactions, restrictive 
                        maintenance or operational conditions, 
                        or other measures with respect to 
                        property, including patents, 
                        trademarks, or copyrights, so owned, 
                        the effect of which is to nationalize, 
                        expropriate, or otherwise seize 
                        ownership or control of such property,
                unless clause (ii) applies.
                  (ii) This clause applies if the President 
                determines that--
                          (I) prompt, adequate, and effective 
                        compensation has been or is being made 
                        to the citizen, corporation, 
                        partnership, or association referred to 
                        in clause (i),
                          (II) good faith negotiations to 
                        provide prompt, adequate, and effective 
                        compensation under the applicable 
                        provisions of international law are in 
                        progress, or the country described in 
                        clause (i) is otherwise taking steps to 
                        discharge its obligations under 
                        international law with respect to such 
                        citizen, corporation, partnership, or 
                        association, or
                          (III) a dispute involving such 
                        citizen, corporation, partnership, or 
                        association over compensation for such 
                        a seizure has been submitted to 
                        arbitration under the provisions of the 
                        Convention for the Settlement of 
                        Investment Disputes, or in another 
                        mutually agreed upon forum,
                and the President promptly furnishes a copy of 
                such determination to the Senate and House of 
                Representatives.
                  (E) Such country fails to act in good faith 
                in recognizing as binding or in enforcing 
                arbitral awards in favor of United States 
                citizens or a corporation, partnership, or 
                association which is 50 percent or more 
                beneficially owned by United States citizens, 
                which have been made by arbitrators appointed 
                for each case or by permanent arbitral bodies 
                to which the parties involved have submitted 
                their dispute.
                  (F) Such country aids or abets, by granting 
                sanctuary from prosecution to, any individual 
                or group which has committed an act of 
                international terrorism.
                  (G) Such country has not taken or is not 
                taking steps to afford internationally 
                recognized worker rights to workers in the 
                country (including any designated zone in that 
                country).
        Subparagraphs (D), (E), (F), and (G) shall not prevent 
        the designation of any country as a beneficiary 
        developing country under this title if the President 
        determines that such designation will be in the 
        national economic interest of the United States and 
        reports such determination to the Congress with the 
        reasons therefor.
    (c) Factors Affecting Country Designation.--In determining 
whether to designate any country as a beneficiary developing 
country under this title, the President shall take into 
account--
          (1) an expression by such country of its desire to be 
        so designated;
          (2) the level of economic development of such 
        country, including its per capita gross national 
        product, the living standards of its inhabitants, and 
        any other economic factors which the President deems 
        appropriate;
          (3) the extent to which other major developed 
        countries are extending generalized preferential tariff 
        treatment to such country;
          (4) the extent to which such country has assured the 
        United States that it will provide equitable and 
        reasonable access to the markets and basic commodity 
        resources of such country and the extent to which such 
        country has assured the United States that it will 
        refrain from engaging in unreasonable export practices;
          (5) whether such country is providing adequate and 
        effective protection of intellectual property rights;
          (6) the extent to which such country has taken action 
        to--
                  (A) reduce trade distorting investment 
                practices and policies (including export 
                performance requirements); and
                  (B) reduce or eliminate barriers to trade in 
                services;
          (7) whether or not such country has taken or is 
        taking steps to afford to workers in that country 
        (including any designated zone in that country) 
        internationally recognized worker rights; and
          (8) the extent to which such country fails to 
        cooperate with the United States in preventing the 
        proliferation of nuclear weapons, nuclear weapons 
        components, and nuclear weapons delivery systems, or in 
        preventing illegal drug trafficking.
A country may be found to not provide adequate and effective 
protection of intellectual property rights under paragraph (5) 
and section 503(d)(2)(B), notwithstanding the fact that it may 
be in compliance with the specific obligations of the Agreement 
on Trade-Related Aspects of Intellectual Property Rights 
referred to in section 101(d)(15) of the Uruguay Round 
Agreements Act.
    (d) Withdrawal, Suspension, or Limitation of Country 
Designation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any country. 
        Except in exceptional circumstances, the President, 
        before taking any action under this subsection, shall 
        provide a period for the submission of public comments 
        on the matter under consideration, and in taking any 
        action under this subsection, the President shall 
        consider the factors set forth in section 501 and 
        subsection (c) of this section, and comments received 
        from the public.
          (2) Changed circumstances.--The President shall, 
        after complying with the requirements of subsection 
        (f)(2), withdraw or suspend the designation of any 
        country as a beneficiary developing country if, after 
        such designation, the President determines that as the 
        result of changed circumstances such country would be 
        barred from designation as a beneficiary developing 
        country under subsection (b)(2). Such country shall 
        cease to be a beneficiary developing country on the day 
        on which the President issues an Executive order or 
        Presidential proclamation revoking the designation of 
        such country under this title.
    (e) Mandatory Graduation of Beneficiary Developing 
Countries.--If the President determines that a beneficiary 
developing country has become a ``high income'' country, as 
defined by the official statistics of the International Bank 
for Reconstruction and Development, then the President shall 
terminate the designation of such country as a beneficiary 
developing country for purposes of this title, effective on the 
day after December 31 of the year following the year in which 
such determination is made.
    (f) Congressional Notification.--
          (1) Notification of designation.--(A) Before the 
        President designates any country as a beneficiary 
        developing country under this title, the President 
        shall notify the Congress of the President's intention 
        to make such designation, together with the 
        considerations entering into such decision.
          (B) At least 60 days before the President designates 
        any country as a least-developed beneficiary developing 
        country, the President shall notify the Congress of the 
        President's intention to make such designation.
          (2) Notification of termination.--If the President 
        has designated any country as a beneficiary developing 
        country under this title, the President shall not 
        terminate such designation unless, at least 60 days 
        before such termination, the President has notified the 
        Congress and has notified such country of the 
        President's intention to terminate such designation, 
        together with the considerations entering into such 
        decision.

SEC. 503. DESIGNATION OF ELIGIBLE ARTICLES.

  (a) Eligible Articles.--
          (1) Designation.--
                  (A) In general.--Except as provided in 
                subsection (b), the President is authorized to 
                designate articles as eligible articles for all 
                beneficiary developing countries for purposes 
                of this title by Executive order or 
                Presidential proclamation after receiving the 
                advice of the International Trade Commission in 
                accordance with subsection (e).
                  (B) Least-developed beneficiary developing 
                countries.--Except as provided in subsection 
                (b), the President is authorized to designate 
                additional articles as eligible articles only 
                for countries designated as least-developed 
                beneficiary developing countries under section 
                502(a)(2) if, after receiving the advice of the 
                International Trade Commission in accordance 
                with subsection (e) of this section, the 
                President determines that such articles are not 
                import-sensitive in the context of imports from 
                least-developed beneficiary developing 
                countries.
                  (C) Three-year rule.--If, after receiving the 
                advice of the International Trade Commission 
                under subsection (e), an article has been 
                formally considered for designation as an 
                eligible article under this title and denied 
                such designation, such article may not be 
                reconsidered for such designation for a period 
                of three years after such denial.
          (2) Rule of origin.--
                  (A) General rule.--The duty-free treatment 
                provided under this title shall apply to any 
                eligible article which is the growth, product, 
                or manufacture of a beneficiary developing 
                country if--
                          (i) that article is imported directly 
                        from a beneficiary developing country 
                        into the customs territory of the 
                        United States; and
                          (ii) the sum of--
                                  (I) the cost or value of the 
                                materials produced in the 
                                beneficiary developing country 
                                or any two or more countries 
                                which are members of the same 
                                association of countries which 
                                is treated as one country under 
                                section 506(2), plus
                                  (II) the direct costs of 
                                processing operations performed 
                                in such beneficiary developing 
                                country or such member 
                                countries,
                is not less than 35 percent of the appraised 
                value of such article at the time it is 
                entered.
                  (B) Exclusions.--An article shall not be 
                treated as the growth, product, or manufacture 
                of a beneficiary developing country by virtue 
                of having merely undergone--
                          (i) simple combining or packaging 
                        operations, or
                          (ii) mere dilution with water or mere 
                        dilution with another substance that 
                        does not materially alter the 
                        characteristics of the article.
          (3) Regulations.--The Secretary of the Treasury, 
        after consulting with the United States Trade 
        Representative, shall prescribe such regulations as may 
        be necessary to carry out paragraph (2), including, but 
        not limited to, regulations providing that, in order to 
        be eligible for duty-free treatment under this title, 
        an article--
                  (A) must be wholly the growth, product, or 
                manufacture of a beneficiary developing 
                country, or
                  (B) must be a new or different article of 
                commerce which has been grown, produced, or 
                manufactured in the beneficiary developing 
                country.
  (b) Articles That May Not Be Designated As Eligible 
Articles.--
          (1) Import sensitive articles.--The President may not 
        designate any article as an eligible article under 
        subsection (a) if such article is within one of the 
        following categories of import-sensitive articles:
                  (A) Textile and apparel articles which were 
                not eligible articles for purposes of this 
                title on January 1, 1994, as this title was in 
                effect on such date.
                  (B) Import-sensitive electronic articles.
                  (C) Import-sensitive steel articles.
                  (D) Footwear, handbags, luggage, flat goods, 
                work gloves, and leather wearing apparel which 
                were not eligible articles for purposes of this 
                title on January 1, 1995, as this title was in 
                effect on such date.
                  (E) Import-sensitive semimanufactured and 
                manufactured glass products.
                  (F) Any other articles which the President 
                determines to be import-sensitive in the 
                context of the Generalized System of 
                Preferences.
          (2) Articles against which other actions taken.--An 
        article shall not be an eligible article for purposes 
        of this title for any period during which such article 
        is the subject of any action proclaimed pursuant to 
        section 203 of this Act (19 U.S.C. 2253) or section 232 
        or 351 of the Trade Expansion Act of 1962 (19 U.S.C. 
        1862, 1981).
          (3) Agricultural products.--No quantity of an 
        agricultural product subject to a tariff-rate quota 
        that exceeds the in-quota quantity shall be eligible 
        for duty-free treatment under this title.
  (c) Withdrawal, Suspension, or Limitation of Duty-Free 
Treatment; Competitive Need Limitation.--
          (1) In general.--The President may withdraw, suspend, 
        or limit the application of the duty-free treatment 
        accorded under this title with respect to any article, 
        except that no rate of duty may be established with 
        respect to any article pursuant to this subsection 
        other than the rate which would apply but for this 
        title. In taking any action under this subsection, the 
        President shall consider the factors set forth in 
        sections 501 and 502(c).
          (2) Competitive need limitation.--
                  (A) Basis for withdrawal of duty-free 
                treatment.--Except as provided in this 
                paragraph and subject to subsection (d), 
                whenever the President determines that a 
                beneficiary developing country has exported 
                (directly or indirectly) to the United States 
                during any calendar year beginning after 
                December 31, 1995--
                          (i) a quantity of an eligible article 
                        having an appraised value in excess of 
                        $75,000,000, except that, in applying 
                        this clause, the amount of $75,000,000 
                        shall be increased by $5,000,000 on 
                        January 1 of each calendar year after 
                        calendar year 1995, or
                          (ii) a quantity of an eligible 
                        article equal to or exceeding 50 
                        percent of the appraised value of the 
                        total imports of that article into the 
                        United States during the calendar year,
                then the President shall, not later than July 1 
                of the next calendar year, terminate the duty-
                free treatment for that article from that 
                beneficiary developing country.
                  (B) Country defined.--For purposes of this 
                paragraph, the term ``country'' does not 
                include an association of countries which is 
                treated as one country under section 506(2), 
                but does include a country which is a member of 
                any such association.
                  (C) Redesignations.--A country which is no 
                longer treated as a beneficiary developing 
                country with respect to an eligible article by 
                reason of subparagraph (A) may be redesignated 
                a beneficiary developing country with respect 
                to such article, subject to the considerations 
                set forth in sections 501 and 502, if imports 
                of such article from such country did not 
                exceed the limitations in subparagraph (A) 
                during the preceding calendar year.
                  (D) Least-developed beneficiary developing 
                countries.--Subparagraph (A) shall not apply to 
                any least-developed beneficiary developing 
                country.
                  (E) Articles not produced in the united 
                states excluded.--Subparagraph (A)(ii) shall 
                not apply with respect to any eligible article 
                if a like or directly competitive article was 
                not produced in the United States on January 1, 
                1995.
                  (F) De minimis waivers.--The President may 
                disregard subparagraph (A)(ii) with respect to 
                any eligible article from any beneficiary 
                developing country if the appraised value of 
                the total imports of such article into the 
                United States during calendar year 1995 or any 
                calendar year thereafter does not exceed 
                $13,000,000, except that, in applying this 
                subparagraph, the amount of $13,000,000 shall 
                be increased by $500,000 on January 1 of each 
                calendar year after calendar year 1995.
  (d) Waiver of Competitive Need Limitation.--
          (1) In general.--The President may waive the 
        application of subsection (c)(2) with respect to any 
        eligible article of any beneficiary developing country 
        if, before July 1 of the calendar year beginning after 
        the calendar year for which a determination described 
        in subsection (c)(2)(A) was made with respect to such 
        eligible article, the President--
                  (A) receives the advice of the International 
                Trade Commission under section 332 of the 
                Tariff Act of 1930 on whether any industry in 
                the United States is likely to be adversely 
                affected by such waiver,
                  (B) determines, based on the considerations 
                described in sections 501 and 502(c) and the 
                advice described in subparagraph (A), that such 
                waiver is in the national economic interest of 
                the United States, and
                  (C) publishes the determination described in 
                subparagraph (B) in the Federal Register.
          (2) Considerations by the president.--In making any 
        determination under paragraph (1), the President shall 
        give great weight to--
                  (A) the extent to which the beneficiary 
                developing country has assured the United 
                States that such country will provide equitable 
                and reasonable access to the markets and basic 
                commodity resources of such country, and
                  (B) the extent to which such country provides 
                adequate and effective protection of 
                intellectual property rights.
          (3) Effective period of waiver.--Any waiver granted 
        under this subsection shall remain in effect until the 
        President determines that such waiver is no longer 
        warranted due to changed circumstances.
  (e) International Trade Commission Advice.--Before 
designating articles as eligible articles under section 
503(a)(1), the President shall publish and furnish the 
International Trade Commission with lists of articles which may 
be considered for designation as eligible articles for purposes 
of this title. The provisions of sections 131, 132, 133, and 
134 shall be complied with as though action under section 501 
and this section were action under section 123 to carry out a 
trade agreement entered into under section 123.
  (f) Special Rule Concerning Puerto Rico.--No action under 
this title may affect any tariff duty imposed by the 
Legislature of Puerto Rico pursuant to section 319 of the 
Tariff Act of 1930 on coffee imported into Puerto Rico.

SEC. 504. REVIEW AND REPORTS TO CONGRESS.

  (a) Report on Operation of Title.--On or before July 31, 
1997, the President shall submit to the Congress a full and 
complete report regarding the operation of this title.
  (b) Annual Reports on Worker Rights.--The President shall 
submit an annual report to the Congress on the status of 
internationally recognized worker rights within each 
beneficiary developing country.

SEC. 505. DATE OF TERMINATION.

  No duty-free treatment provided under this title shall remain 
in effect after December 31, 1997.

SEC. 506. DEFINITIONS.

  For purposes of this title:
          (1) Beneficiary developing country.--The term 
        ``beneficiary developing country'' means any country 
        with respect to which there is in effect an Executive 
        order or Presidential proclamation by the President 
        designating such country as a beneficiary developing 
        country for purposes of this title.
          (2) Country.--The term ``country'' means any foreign 
        country or territory, including any overseas dependent 
        territory or possession of a foreign country, or the 
        Trust Territory of the Pacific Islands. In the case of 
        an association of countries which is a free trade area 
        or customs union, or which is contributing to 
        comprehensive regional economic integration among its 
        members through appropriate means, including, but not 
        limited to, the reduction of duties, the President may 
        by Executive order or Presidential proclamation provide 
        that all members of such association other than members 
        which are barred from designation under section 502(b) 
        shall be treated as one country for purposes of this 
        title.
          (3) Entered.--The term ``entered'' means entered, or 
        withdrawn from warehouse for consumption, in the 
        customs territory of the United States.
          (4) Internationally recognized worker rights.--The 
        term ``internationally recognized worker rights'' 
        includes--
                  (A) the right of association;
                  (B) the right to organize and bargain 
                collectively;
                  (C) a prohibition on the use of any form of 
                forced or compulsory labor;
                  (D) a minimum age for the employment of 
                children; and
                  (E) acceptable conditions of work with 
                respect to minimum wages, hours of work, and 
                occupational safety and health.
          (5) Least-developed beneficiary developing country.--
        The term ``least-developed beneficiary developing 
        country'' means a beneficiary developing country that 
        is designated as a least-developed beneficiary 
        developing country under section 502(a)(2).
          * * * * * * *

            SECTION 405 OF THE URUGUAY ROUND AGREEMENTS ACT

SEC. 405. SPECIAL AGRICULTURAL SAFEGUARD AUTHORITY.

  (a) * * *
  (b) Determination of Safeguard.--If the President determines 
with respect to a special safeguard agricultural good that it 
is appropriate to impose--
          (1) the price-based safeguard in accordance with 
        subparagraph [1(a)] 1(b) of Article 5; or
          (2) the volume-based safeguard in accordance with 
        subparagraph [1(b)] 1(a) of Article 5,
the President shall, consistent with Article 5 as determined by 
the President, determine the amount of the duty to be imposed, 
the period such duty shall be in effect, and any other terms 
and conditions applicable to the duty.
          * * * * * * *
                              ----------                              


           THE OMNIBUS TRADE AND COMPETITIVENESS ACT OF 1988

                TITLE I--TRADE, CUSTOMS, AND TARIFF LAWS

          * * * * * * *

      Subtitle B--Implementation of the Harmonized Tariff Schedule

          * * * * * * *

 H4  deg.SEC. 1211. TRANSITION TO THE HARMONIZED TARIFF 
                    SCHEDULE.

  (a) * * *
  (b) Generalized System of Preferences Conversion.--
          (1) The review of the proposed conversion of the 
        Generalized System of Preferences program to the 
        Convention tariff nomenclature, initiated by the Office 
        of the United States Trade Representative by notice 
        published in the Federal Register on December 8, 1986 
        (at page 44,163 of volume 51 thereof), shall be treated 
        as satisfying the requirements of sections 503(a) and 
        504(c)(3) of the Trade Act of 1974 [(19 U.S.C. 2463(a), 
        2464(c)(3))] (as in effect on the day before the date 
        of the enactment of the GSP Renewal Act of 1995).
          (2) In applying section 504(c)(1) of the Trade Act of 
        1974 [(19 U.S.C. 2464(c)(1))] (as in effect on the day 
        before the date of the enactment of the GSP Renewal Act 
        of 1995) for calendar year 1989, the reference in such 
        section to July 1 shall be treated as a reference to 
        September 1.
          * * * * * * *

                      TITLE II--EXPORT ENHANCEMENT

 H4  deg.SEC. 2001. SHORT TITLE.

  This title may be referred to as the ``Export Enhancement Act 
of 1988''.
          * * * * * * *

                     Subtitle B--Export Enhancement

               H5  deg.PART I--GENERAL PROVISIONS

          * * * * * * *

 H4  deg.SEC. 2202. COUNTRY REPORTS ON ECONOMIC POLICY AND 
                    TRADE PRACTICES.

  The Secretary of State shall, not later than January 31 of 
each year, prepare and transmit to the Committee on Foreign 
Affairs and the Committee on Ways and Means of the House of 
Representatives, to the Committee on Foreign Relations and the 
Committee on Finance of the Senate, and to other appropriate 
committees of the Congress, a detailed report regarding the 
economic policy and trade practices of each country with which 
the United States has an economic or trade relationship. The 
Secretary may direct the appropriate officers of the Department 
of State who are serving overseas, in consultation with 
appropriate officers or employees of other departments and 
agencies of the United States, including the Department of 
Agriculture and the Department of Commerce, to coordinate the 
preparation of such information in a country as is necessary to 
prepare the report under this section. The report shall 
identify and describe, with respect to each country--
          (1) * * *
          * * * * * * *
          (8) the country's laws, enforcement of those laws, 
        and practices with respect to internationally 
        recognized worker rights (as defined in section 
        [502(a)(4)] 506(4) of the Trade Act of 1974), the 
        conditions of worker rights in any sector which 
        produces goods in which United States capital is 
        invested, and the extent of such investment.
          * * * * * * *
                              ----------                              


            SECTION 871 OF THE INTERNAL REVENUE CODE OF 1986

SEC. 871. TAX ON NONRESIDENT ALIEN INDIVIDUALS.

    (a) * * *
          * * * * * * *
    (f) Certain annuities Received Under Qualified Plans--
          (1) * * *
          (2) Exclusion.--Income received during the taxable 
        year which would be excluded from gross income under 
        this subsection but for the requirement of paragraph 
        (1)(B) shall not be included in gross income if--
                  (A) the recipient's country of residence 
                grants a substantially equivalent exclusion to 
                residents and citizens of the United States; or
                  (B) the recipient's country of residence is a 
                beneficiary developing country [within the 
                meaning of section 502] under title V of the 
                Trade Act of 1974 (19 U.S.C. 2462).
                              ----------                              


           SECTION 231A OF THE FOREIGN ASSISTANCE ACT OF 1961

  Sec. 231A. Additional Requirements.--(a) Worker Rights.--
          (1) Limitation on OPIC Activities.--The Corporation 
        may insure, reinsure, guarantee, or finance a project 
        only if the country in which the project is to be 
        undertaken is taking steps to adopt and implement laws 
        that extend internationally recognized worker rights, 
        as defined in section [502(a)(4) of the Trade Act of 
        1974 (19 U.S.C. 2462(a)(4))] 506(4) of the Trade Act of 
        1974, to workers in that country (including any 
        designated zone in that country). The Corporation shall 
        also include the following language, in substantially 
        the following form, in all contracts which the 
        Corporation enters into with eligible investors to 
        provide financial support under this title: 
          ``The investor agrees not to take actions to prevent 
        employees of the foreign enterprise from lawfully 
        exercising their right of association and their right 
        to organize and bargain collectively. The investor 
        further agrees to observe applicable laws relating to a 
        minimum age for employment of children, acceptable 
        conditions of work with respect to minimum wages, hours 
        of work, and occupational health and safety, and not to 
        use forced labor. The investor is not responsible under 
        this paragraph for the actions of a foreign 
        government.''
          (2) Use of Annual Reports on Workers Rights.--The 
        Corporation shall, in making its determinations under 
        paragraph (1), use the reports submitted to the 
        Congress pursuant to section [505(c) of the Trade Act 
        of 1974 (19 U.S.C. 2465(c))] 504(b) of the Trade Act of 
        1974. The restriction set forth in paragraph (1) shall 
        not apply until the first such report is submitted to 
        the Congress.
          * * * * * * *
          (4) In making a determination under this section for 
        the People's Republic of China, the Corporation shall 
        discuss fully and completely the justification for 
        making such determination with respect to each item set 
        forth in subparagraphs (A) through (E) of section 
        [502(a)(4)] 506(4) of the Trade Act of 1974.
          * * * * * * *

                       IV. Votes of the Committee

    In compliance with clause 2(l)(2)(B) of rule XI of the 
Rules of the House of Representatives, the following statements 
are made concerning the votes of the committee in its 
consideration of the reconciliation recommendations.

                  MOTION TO REPORT THE RECOMMENDATIONS

    The reconciliation recommendations, as amended, were 
ordered favorably reported by voice vote on September 13, 1995, 
with a quorum present.

                          VOTES ON AMENDMENTS

    The committee defeated an amendment (15 yeas and 22 nays) 
offered by Mr. Zimmer to add a new subtitle to the budget 
reconciliation recommendations which would add a new subtitle 
to the recommendations that would defer implementation of 
section 334 of the Uruguay Round Agreements Act, which shifts 
the basis for origin determinations from the country where 
fabric is cut to the country where pieces are assembled, 
effective July 1, 1996. The roll call is as follows:
        YEAS                          NAYS
Mr. Archer                          Mr. Thomas
Mr. Crane                           Mr. Shaw
Mr. Herger                          Mrs. Johnson
Mr. Ramstad                         Mr. Bunning
Mr. Zimmer                          Mr. Houghton
Mr. Nussle                          Mr. McCrery
Mr. Johnson                         Mr. Hancock
Ms. Dunn                            Mr. Camp
Mr. Portman                         Mr. Collins
Mr. English                         Mr. Laughlin
Mr. Ensign                          Mr. Gibbons
Mr. Christensen                     Mr. Rangel
Mr. Matsui                          Mr. Stark
Mrs. Kennelly                       Mr. Jacobs
Mr. McDermott                       Mr. Ford
                                    Mr. Coyne
                                    Mr. Levin
                                    Mr. Cardin
                                    Mr. Kleczka
                                    Mr. Lewis
                                    Mr. Payne
                                    Mr. Neal

                  MOTION TO REPORT THE RECOMMENDATIONS

    The reconciliation recommendations, as amended, were 
ordered favorably reported by voice vote on September 21, 1995, 
with a quorum present.

                          VOTES ON AMENDMENTS

    A division of the question was demanded on an amendment 
offered by Mr. Kleczka: First, to permit the Secretary of Labor 
to grant waivers for training where training programs are not 
available; and second, to amend relocation allowance amounts.
    1. The committee agreed to the portion of the amendment 
regarding waivers (18 yeas and 17 nays). The rollcall is as 
follows:
        YEAS                          NAYS
Mr. Thomas                          Mr Archer
Mr. Shaw                            Mr. Crane
Mrs. Johnson                        Mr. Bunning
Mr. English                         Mr. Houghton
Mr. Engish                          Mr. Herger
Mr. Gibbons                         Mr. McCrery
Mr. Rangel                          Mr. Hancock
Mr. Jacobs                          Mr. Camp
Mr. Matsui                          Mr. Ramstad
Mrs. Kennelly                       Mr. Zimmer
Mr. Coyne                           Mr. Nussle
Mr. Levin                           Mr. Johnson
Mr. Cardin                          Ms. Dunn
Mr. McDermott                       Mr. Collins
Mr. Kleczka                         Mr. Portman
Mr. Lewis                           Mr. Laughlin
Mr. Payne                           Mr. Christensen
Mr. Neal

    2. The committee defeated the portion of the amendment 
regarding relocation allowances (14 yeas and 20 nays). The 
rollcall is as follows:
        YEAS                          NAYS
Mr. English                         Mr. Archer
Mr. Gibbons                         Mr. Crane
Mr. Rangel                          Mr. Shaw
Mr. Jacobs                          Mrs. Johnson
Mr. Matsui                          Mr. Bunning
Mrs. Kennelly                       Mr. Houghton
Mr. Coyne                           Mr. Herger
Mr. Levin                           Mr. McCrery
Mr. Cardin                          Mr. Hancock
Mr. McDermott                       Mr. Camp
Mr. Kleczka                         Mr. Ramstad
Mr. Lewis                           Mr. Zimmer
Mr. Payne                           Mr. Nussle
Mr. Neal                            Mr. Johnson
                                    Ms. Dunn
                                    Mr. Collins
                                    Mr. Portman
                                    Mr. Laughlin
                                    Mr. Ensign
                                    Mr. Christensen

                     V. Budget Effects of the Bill

               1. COMMITTEE ESTIMATE OF BUDGETARY EFFECTS

    In compliance with clause 7(a) of rule XIII of the Rules of 
the House of Representatives, the following statement is made:
    The committee agrees with the estimate prepared by the 
Congressional Budget Office [CBO] which is included below.

    2. STATEMENT REGARDING NEW BUDGET AUTHORITY AND TAX EXPENDITURES

    In compliance with clause 2(l)(3)(B) of rule XI of the 
Rules of the House of Representatives, the committee states 
that the committee recommendations result in new discretionary 
budget authority and no new increased tax expenditures or 
revenues.

      3. COST ESTIMATE PREPARED BY THE CONGRESSIONAL BUDGET OFFICE

    In compliance with clause 2(l)(3)(C) of rule XI of the 
Rules of the House of Representatives requiring a cost estimate 
prepared by the Congressional Budget Office, the following 
report prepared by CBO is provided.

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 21, 1995.
Hon. Philip M. Crane,
Chairman, Subcommittee on Trade, Committee on Ways and Means, House of 
        Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office [CBO] 
has reviewed the trade subtitles A-C as marked up by the 
Subcommittee on Trade of the Committee on Ways and Means on 
September 14, 1995. CBO estimates that subtitle A, the 
technical corrections provisions, would result in a net 
decrease in revenues of $2 million in fiscal year 1996 and a 
loss of offsetting receipts of $1 million annually for each of 
the fiscal years 1996 to 2002. Subtitle B, the GSP Renewal Act 
of 1995, would reduce revenues by $532 million in fiscal year 
1996 and by $938 million over fiscal years 1996 through 2002, 
net of income and payroll tax offsets. Subtitle C, regarding 
the identification of trade expansion priorities, would have no 
significant budgetary impact. This estimate, which includes 
projections through 2002, supersedes CBO's estimate of 
September 19, 1995, which included projections only through 
2000.

                               subtitle a

    Subtitle A makes technical corrections in certain trade 
legislation and other miscellaneous trade provisions. CBO 
estimates that most provisions would have no significant 
budgetary impact. However, there are two exceptions.
    One exception is the provision that modifies section 
484E(b)(2)(B) of the Customs and Trade Act of 1990 to extend 
retroactively the temporary exemption regarding certain vessel 
repairs. Prior to December 31, 1992, lighter aboard ship [LASH] 
barges were exempted from the 50 percent ad valorem duty on 
vessel repairs done in foreign ports. This exemption was made 
permanent as of January 1, 1995, under the Uruguay Round 
Agreements Act. Returning the duties collected on such LASH 
barges vessel repairs between December 31, 1992, and December 
31, 1994, would result in a net decrease in revenues of about 
$2 million in fiscal year 1996.
    The second exception is the provision that ensures the 
collection of customs user fees only one time in the course of 
a single voyage for a passenger on a commercial vessel. CBO 
estimates that this would result in a net decrease of 
offsetting receipts of about $1 million annually. The budgetary 
effects of subtitle A are summarized in the table below.

                               subtitle B

    The U.S. Generalized System of Preferences [GSP] affords 
nonreciprocal tariff preferences to approximately 145 
developing countries to aid their economic development and to 
diversify and expand their production and exports. Several 
industrial countries also offer similar preferences. Generally, 
duty-free treatment of imported goods from GSP designated 
developing countries is extended to products that are not 
competitive internationally. Also, the program contains 
safeguard mechanisms to protect domestic industries that are 
sensitive to import competition.
    The U.S. GSP expired on July 31, 1995. Subtitle B would 
retroactively apply GSP from July 31, 1995, and extend the 
program through December 31, 1997, with some modifications. 
Previously under GSP, eligible imports were subject to 
competitive need limitations on GSP duty-free treatment that 
were subject to waiver under certain conditions. If imports of 
a GSP eligible product from a particular country exceeded a 
certain dollar level in a calendar year--the level was about 
$110 million--or 50 percent of total U.S. imports of that 
product, then GSP treatment was removed for that product unless 
a waiver was granted. Under subtitle B, the competitive need 
limit would be lowered to $75 million. Consequently, fewer 
products would receive duty-free treatment than under the 
provision that recently expired.
    The estimate of revenue loss is based on 1993 trade data 
and accounts for the graduation of Malaysia from GSP on January 
1, 1997, as recommended by the USTR on August 15, 1995. 
Malaysia has been a top beneficiary of GSP accounting for about 
a quarter of total GSP imports. The budget effects of subtitle 
B are shown below.

                                       BUDGET EFFECTS OF SUBTITLES A AND B                                      
                                    [By fiscal year, in billions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                 1996        1997        1998        1999        2000        2001        2002   
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                            Changes in Revenues (Net)                                           
                                                                                                                
Projected revenues under                                                                                        
 current law \1\............    1417.619    1475.210    1546.076    1617.969    1697.155    1786.321    1879.300
Subtitle A: Proposed changes     -0.0020       0.000       0.000       0.000       0.000       0.000       0.000
Subtitle B: Proposed changes      -0.532      -0.328      -0.078       0.000       0.000       0.000       0.000
Projected revenues under                                                                                        
 subtitles A and B..........    1417.165    1474.882    1545.998    1617.969    1697.155    1786.321    1879.300
                                                                                                                
                                         Changes in Offsetting Receipts                                         
                                                                                                                
Projected COBRA fees under                                                                                      
 current law................       0.396       0.427       0.263       0.282       0.302       0.323       0.346
Subtitle A: Proposed changes      -0.001      -0.001      -0.001      -0.001      -0.001      -0.001      -0.001
Projected COBRA fees under                                                                                      
 subtitle A.................       0.395       0.426       0.262       0.281       0.301       0.322       0.345
----------------------------------------------------------------------------------------------------------------
\1\ Includes the revenue effects of Public Law 104-7 (H.R. 831).                                                

    Section 252 of the Balanced Budget and Emergency Deficit 
Control Act of 1985 sets up pay-as-you-go procedures for 
legislation affecting receipts or direct spending through 1998. 
Because subtitles A and B would affect direct spending and 
receipts, pay-as-you-go procedures would apply. These effects 
are summarized in the table below:

                                          PAY-AS-YOU-GO CONSIDERATIONS                                          
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                                      1996             1997             1998    
----------------------------------------------------------------------------------------------------------------
Changes in receipts..........................................          -534             -327              -78   
Changes in outlays...........................................             1                1                1   
----------------------------------------------------------------------------------------------------------------

    If you wish further details, please feel free to contact me 
or your staff may wish to contact Stephanie Weiner at 226-2720 
or Mark Grabowicz at 226-2860.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 28, 1995.
Hon. Bill Archer,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office [CBO] 
has prepared the enclosed cost estimate for the trade 
adjustment assistance reconciliation language approved by the 
House Committee on Ways and Means on September 21, 1995.
    This estimate shows the budgetary effects of the 
committee's proposals over the 1996-2002 period. CBO 
understands that the Committee on the Budget will be 
responsible for interpreting how these proposals compare with 
the reconciliation instructions in the budget resolution.
    This estimate assumes the reconciliation bill will be 
enacted by November 15, 1995.
    If you wish further details on this estimate, we will be 
pleased to provide them.
            Sincerely,
                                              James L. Blum
                                   (For June E. O'Neill, Director).

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    1. Bill title: Reconciliation recommendations of the House 
Committee on Ways and Means relating to trade adjustment 
assistance.
    2. Bill status: As approved by the House Committee on Ways 
and Means on September 21, 1995.
    3. Bill purpose: To modify trade adjustment assistance and 
reauthorize the programs for fiscal years 1999 and 2000.
    4. Estimated cost to the Federal Government: Effective 
October 1, 1996, this proposal would modify trade adjustment 
assistance [TAA] programs for workers by not allowing funds to 
be used for relocation expenses. Table 1 shows projected direct 
spending for these programs under current law, the changes that 
would stem from the proposal, and the projected direct spending 
if the proposal were enacted.

   TABLE 1. BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON WAYS AND MEANS--DIRECT   
                                                    SPENDING                                                    
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                           1995   1996   1997   1998   1999   2000   2001   2002
----------------------------------------------------------------------------------------------------------------
Projected direct spending under current law:                                                                    
    Estimated budget authority..........................    338    346    322    330    259    254    258    261
    Estimated outlays...................................    313    335    330    325    281    261    258    261
Proposed changes:                                                                                               
    Estimated budget authority:.........................  .....  .....     -2     -1     -1     -1     -1     -1
    Estimated outlays...................................  .....  .....  (\1\)     -2     -1     -1     -1     -1
Projected direct spending under the proposal:                                                                   
    Estimated budget authority:.........................    338    346    320    329    258    253    257    260
    Estimated outlays...................................    313    335    330    323    280    260    257    260
----------------------------------------------------------------------------------------------------------------
\1\ Indicates savings of less than $500,000.                                                                    

    Additionally, this proposal would increase discretionary 
spending by authorizing trade adjustment assistance for firms 
through fiscal year 2000. Currently, this program is authorized 
only through fiscal year 1998. Table 2 shows the estimated 
changes in authorizations with and without adjustments for 
inflation.

      TABLE 2. BUDGETARY IMPACT OF THE RECONCILIATION PROPOSALS OF THE HOUSE COMMITTEE ON WAYS AND MEANS--      
                                        AUTHORIZATIONS OF APPROPRIATIONS                                        
                                    [By fiscal year, in millions of dollars]                                    
----------------------------------------------------------------------------------------------------------------
                                                           1995   1996   1997   1998   1999   2000   2001   2002
----------------------------------------------------------------------------------------------------------------
                                                                                                                
                                       INCLUDING ADJUSTMENTS FOR INFLATION                                      
                                                                                                                
Projected authorizations under current law:                                                                     
    Estimated authorizations of appropriations..........     10     10     11     11  .....  .....  .....  .....
    Estimated outlays...................................     13     12     11     10     10      8      5      3
Proposed changes:                                                                                               
    Estimated authorizations of appropriations..........  .....  .....  .....  .....     11     12  .....  .....
    Estimated outlays...................................  .....  .....  .....  .....  (\1\)      3      6      6
Projected authorizations under the proposal:                                                                    
    Estimated authorizations of appropriations:.........     10     10     11     11     11     12  .....  .....
    Estimated outlays...................................     13     12     11     10     11     11     11      9
                                                                                                                
                                     NOT INCLUDING ADJUSTMENTS FOR INFLATION                                    
                                                                                                                
Projected authorizations under current law:                                                                     
    Estimated authorizations of appropriations..........     10     10     10     10  .....  .....  .....  .....
    Estimated outlays...................................     13     12     11     10     10      8      5      3
Proposed changes:                                                                                               
    Estimated authorizations of appropriations..........  .....  .....  .....  .....     10     10  .....  .....
    Estimated outlays...................................  .....  .....  .....  .....  (\1\)      2      5      5
Projected authorizations under the proposal:                                                                    
    Estimated authorizations of appropriations..........     10     10     10     10     10     10  .....  .....
    Estimated outlays...................................     13     12     11     10     10     10     10      8
----------------------------------------------------------------------------------------------------------------
\1\ Indicates amounts of less than $500,000.                                                                    

    The costs of this bill fall within budget functions 500 and 
450.
    5. Basis of estimate: This estimate assumes that the 
reconciliation bill will be enacted by November 15, 1995.
    This proposal would modify the trade adjustment assistance 
training program in three ways. First, beginning in fiscal year 
1997, it would require that no funds for this program be used 
for job relocation expenses. Under current law, eligible 
workers may receive up to $800 for job search and job 
relocation expenses. The Department of Labor [DOL] estimates 
that $4 million would be spent for both job relocation and job 
search expenses in fiscal year 1996 and about $2 million a year 
thereafter. Historically, job relocation expenses have been 
about 65 percent of the total expenses for job search and 
relocation. Accordingly, CBO estimates that this modification 
would reduce outlays by about $6 million over the 1996-2002 
period.
    Second, this proposal would require that waivers be granted 
only in instances where no training is available. Current law 
allows the Secretary of Labor to grant waivers in cases where 
available training is not appropriate to a particular worker, 
so that the worker to whom training is not available may still 
receive cash benefits under TAA. CBO estimates that this change 
would not significantly alter the way waivers currently are 
granted. Therefore, no savings are estimated for this 
provision.
    Third, this proposal would extend discretionary trade 
adjustment assistance programs through fiscal year 2000. 
Authorization for these programs expires in fiscal year 1998 
under current law. According to requirements of the Budget 
Enforcement Act, CBO assumes that expiring mandatory programs 
above a threshold of $50 million are extended. Under this 
proposal, authorizations for TAA for firms would increase by a 
total of $20 million in budget authority and $12 million in 
outlays from 1999 to 2002 when compared to the current 
authorization.
    6. Estimated cost to State and local governments: This 
proposal would have no significant effect on the budgets of 
State and local governments.
    7. Estimate comparison: None.
    8. Previous CBO estimate: None.
    9. Estimate prepared by: Christi Hawley.
    10. Estimate approved by: Paul Van de Water, Assistant 
Director for Budget Analysis.

VI. Other Matters Required To Be Discussed Under the Rules of the House

          A. COMMITTEE OVERSIGHT FINDINGS AND RECOMMENDATIONS

    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the committee reports 
that the need for this legislation was confirmed by the 
oversight hearing of the Subcommittee on Trade.
    On February 27, 1995, the subcommittee held a public 
hearing on extending the GSP Program. The Subcommittee on Trade 
received testimony in support of extending GSP from the 
administration and from companies and associations representing 
exporter, importer, economic development, and consumer 
interests.
    In compliance with clause 2(l)(3)(A) of rule XI of the 
Rules of the House of Representatives, the committee reports 
that the need for this legislation was confirmed by a review of 
the program, a desire to make the program more cost-effective, 
and the submission of written public comments.

B. SUMMARY OF FINDINGS AND RECOMMENDATIONS OF THE GOVERNMENT REFORM AND 
                          OVERSIGHT COMMITTEE

    In compliance with clause 2(l)(3)(D) of rule XI of the 
Rules of the House of Representatives, the committee states 
that no oversight findings or recommendations have been 
submitted to the Committee on Government Reform and Oversight 
regarding the subjects of these recommendations.

                    C. INFLATIONARY IMPACT STATEMENT

    In compliance with clause 2(l)(4) of rule XI of the Rules 
of the House of Representatives, the committee states that the 
provisions of the recommendations are not expected to have an 
overall inflationary impact on the economy.

                                
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