[Pages H773-H792]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

PROVIDING FOR CONSIDERATION OF H.R. 3081, WAGE AND EMPLOYMENT GROWTH
ACT OF 1999, AND H.R. 3846, MINIMUM WAGE INCREASE ACT

Mr. SESSIONS. Mr. Speaker, by direction of the Committee on Rules, I
call up House Resolution 434 and ask for its immediate consideration.
The Clerk read the resolution, as follows:

H. Res. 434

Resolved, That upon the adoption of this resolution it
shall be in order without intervention of any point of order
to consider in the House the bill (H.R. 3081) to increase the
Federal minimum wage and to amend the Internal Revenue Code
of 1986 to provide tax benefits for small businesses, and for
other purposes. The bill shall be considered as read for
amendment. In lieu of the amendment recommended by the
Committee on Ways and Means now printed in the bill, an
amendment in the nature of a substitute consisting of the
text of H.R. 3832 shall be considered as adopted. The
previous question shall be considered as ordered on the bill,
as amended, to final passage without intervening motion
except: (1) two hours of debate on the bill, as amended,
equally divided and controlled by the chairman and ranking
minority member of the Committee on Ways and Means; and (2)
one motion to recommit with or without instructions.
Sec. 2. Upon the adoption of this resolution it shall be in
order to consider in the House the bill (H.R. 3846) to amend
the Fair Labor Standards Act of 1938 to increase the minimum
wage, and for other purposes. The bill shall be considered as
read for amendment. The previous question shall be considered
as ordered on the bill and any amendment thereto to final
passage without intervening motion except: (1) one hour of
debate equally divided and controlled by the chairman and
ranking minority member of the Committee on Education and the
Workforce; (2) the amendments printed in the report of the
Committee on Rules accompanying this resolution, which shall
be in order without intervention of any point of order
(except those arising under section 425 of the Congressional
Budget Act of 1974) and which may be offered only in the
order printed in the report, may be offered only by a Member
designated in the report, shall be considered as read, and
shall be separately debatable for the time specified in the
report equally divided and controlled by the proponent and an
opponent; and (3) one motion to recommit with or without
instructions.
Sec. 3. (a) In the engrossment of H.R. 3081, the Clerk
shall--
(1) await the disposition of H.R. 3846;
(2) add the text of H.R. 3846, as passed by the House, as
new matter at the end of H.R. 3081;
(3) conform the title of H.R. 3081 to reflect the addition
of the text of H.R. 3846 to the engrossment;
(4) assign appropriate designations to provisions within
the engrossment; and
(5) conform provisions for short titles within the
engrossment.
(b) Upon the addition of the text of H.R. 3846 to the
engrossment of H.R. 3081, H.R. 3846 shall be laid on the
table.

{time} 1345

The SPEAKER pro tempore (Mr. LaHood). The gentleman from Texas (Mr.
Sessions) is recognized for 1 hour.
Mr. SESSIONS. Mr. Speaker, for the purposes of debate only, I yield
the customary 30 minutes to the gentleman and my friend from
Massachusetts (Mr. Moakley), pending which I yield myself such time as
I may consume. During consideration of this resolution, all time is
yielded for the purpose of debate only.
Mr. Speaker, this resolution provides for the consideration of H.R.
3081 in the House under a closed rule without intervention of any point
of order.
The rule provides that the bill be considered as read and that, in
lieu of the amendment recommended by the Committee on Ways and Means
now printed in the bill, the text H.R. 3832 shall be considered as
adopted.
The rule provides two hours of debate equally divided and controlled
by the chairman and the ranking minority member of the Committee on
Ways and Means.
The rule provides one motion to recommit H.R. 3081 with or without
instructions.
The rule also provides for consideration of H.R. 3846 in the House
under a modified closed rule. It provides that the bill be considered
as read and provides for 1 hour of debate equally divided and
controlled by the chairman and ranking minority member of the Committee
on Education and the Workforce.
The rule provides for consideration of the amendments printed in the
Committee on Rules report accompanying the resolution, which shall be
in order without intervention of any point of order, except those
arising under section 425 of the Congressional Budget

[[Page H774]]

Act of 1974, prohibiting consideration of legislation containing
certain unfunded mandates.
The rule provides that the amendments printed in the Committee on
Rules report accompanying the resolution may only be offered by the
Member designated in the report, shall be considered as read, and shall
be separately debatable for the time specified in the report equally
divided and controlled by the proponent and an opponent.
The rule provides one motion to recommit H.R. 3846 with or without
instructions.
Finally, the rule provides that in the engrossment of H.R. 3081, The
Clerk shall add the text of H.R. 3846 as passed by the House as a new
matter at the end of H.R. 3081, after which H.R. 3846 shall be laid
upon the table.
Mr. Speaker, the rule before us today is a carefully crafted rule
that makes in order two separate bills. The first is a bill out of the
Committee on Ways and Means, H.R. 3081, the Wage and Employment Growth
Act of 1999, which provides a series of tax benefits to small
businesses.
The second piece of legislation, H.R. 3846, is a bill to increase the
minimum wage by $1.00 through incremental steps over the course of 3
years.
Mr. Speaker, the Committee on Ways and Means bill, like almost every
tax bill for many, many years, will not be open to further amendments
on the House Floor. This long-standing policy is designed to keep the
Internal Revenue Code from becoming more cluttered than it is already
with special interest provisions.
Also, amendments offered on short notice on the House floor might
have unintended consequences which may not be fully appreciated without
the adequate time to research those issues.
The Committee on Ways and Means bill will be subject to 2 hours of
debate and allows the minority a motion to recommit with instructions.
The minimum wage bill will receive 1 hour of general debate and makes
in order two amendments, one to increase the minimum wage over the
course of 2 years rather than 3 and another allows States flexibility
to determine their own minimum wage.
By making these amendments in order, the rule facilitates a thorough
debate and vote on the major issues associated with the two bills under
consideration, and by allowing a motion to recommit the legislation
with or without instructions, the minority is assured their perspective
on this issue will be aired and will be voted upon.

Mr. Speaker, I am particularly pleased that Congress is undertaking
an important effort to give tax relief to hard working people who run
small businesses and create jobs. Through small business provisions,
they include an acceleration of the increase in the self-employed
health insurance deduction to 100 percent. This is crucial to making
health care more available to innovative people who take risks by
starting and running their own businesses.
It is often too difficult and costly for a small business to set up
pensions or retirement plans for their employees, especially in their
new and start-up years. The legislation before the House today provides
pension reform and improves retirement security. It increases
contribution and benefit levels and limits in tax-favored retirement
plans. It shortens investing requirements of employer matching
contributions which is very important in today's marketplace, where a
worker often spends only a few years on the job and then moves on.
Mr. Speaker, I represent a district in Texas that has many, many
small businesses. In my district and all across America, small
businesses are an important part of our economy. Small business is the
engine that drives the economy and creates new jobs in America. In
fact, small businesses create more jobs than any other types of
businesses, including large corporations. Too many businesses fail
because our unfair Tax Code and because of heavy regulatory burdens
that consume critical operating capital in their early years. These
small business tax provisions do not just help small businesses but
they help everyone by encouraging job growth.
I remind my colleague that this rule allows for vigorous debate on
every major issue related to the underlying legislation.
Mr. Speaker, like many other conservative Members of this body, I
question if raising the minimum wage might actually hurt those it is
intended to help. I am afraid that employers may look at their rising
payroll ledgers and decide to cut back on the number of employees that
they hire to offset the added expense of the minimum wage hike.
Having said that, it is apparent to me that a majority of Members
feel now that it is the appropriate time to pass a minimum wage
increase. I strongly support this rule because by allowing for an
increase in the minimum wage, it ensures measures to offset the impact
of doing so as part of a major deal that has been encouraged by my
party.
Mr. Speaker, I encourage all Members to support the rule so that the
House may debate the important issues contained in the underlying
legislation.
Mr. Speaker, I reserve the balance of my time.
Mr. MOAKLEY. Mr. Speaker, I thank my colleague and my friend from
Texas (Mr. Sessions) for yielding me the customary half-hour, and I
yield myself such time as I may consume.
Mr. Speaker, this rule provides for the consideration of two bills, a
minimum wage bill and a bill providing predominately estate tax breaks.
Then once both bills pass, they lump them together and they go to the
entire White House.
Mr. Speaker, this is a very bad combination of tax breaks and much
too slow minimum wage hikes. By stretching the minimum wage out to 3
years, the Republican minimum wage bill is a year late and several
dollars short, while their tax bill could just as well be called who
wants to make a millionaire a multimillionaire.
Mr. Speaker, once again my Republican colleagues have taken a
perfectly good idea to raise the $5.15 minimum wage by a dollar and
turned it into another way to make the rich richer while stiffing the
rest of the citizenry.
Furthermore, Mr. Speaker, by linking these two bills together and
creating this very unholy marriage, they have doomed both of these
bills to the veto bin, and American workers deserve better.
Over 10 million people work for minimum wage in this country, and
minimum wage workers are predominately women and minorities. They are
the people who take care of our youngsters, our senior citizens. They
clean up our offices. They cook our food. They pump our gas. Mr.
Speaker, despite working full-time they earn only $10,700 a year.
Let me repeat, Mr. Speaker, full-time a minimum wage worker in the
United States makes only $10,700 a year. That is only $3,200 below the
poverty line. I think it is high time they get a raise, even if it is
only a dollar an hour, but my Republican colleagues want to phase this
raise in over 3 years instead of 2.
Mr. Speaker, for those who say there is not much difference between 2
and 3 years, let me add that that extra year will mean a net loss of
$1,000 over 3 years to minimum wage workers.
Any Member who is committed to welfare reform, any Member who is
committed to getting families off the dole and into the workplace
should take that commitment to the next step and give these people that
very much needed raise. They will still be below the poverty level but
at least the poverty line will be in sight.
A dollar an hour may not sound like much to most people, but let me
say it does make a big difference. It will mean an overall raise of
about $2,000 to over 10 million Americans. Instead of giving these
people the help they need, my Republican colleagues are watering it
down by stretching it out to 3 years and then dooming it by attaching
this very lopsided tax break for the very rich.
Last month, my colleagues on the Republican side of the aisle
introduced a marriage penalty bill and most of the benefits of that
bill went to the top 25 percent of wage earners and half of it went to
people who pay no marriage tax at all. Today's Republican tax bill is
no different. 91.4 percent of the tax cuts in this bill will go to the
richest top 10 percent of taxpayers and most of those people do not
even own small businesses.
What it means, Mr. Speaker, is that for every dollar in higher wages
for

[[Page H775]]

minimum wage workers, the rich will get $10.90 in tax breaks. We had a
marriage penalty bill for people who pay no marriage penalty, and now
we have a small business tax bill for people who do not own small
businesses.
Mr. Speaker, this is just the second installment of that $800 billion
tax break that they tried to get through last year.
Mr. Speaker, minimum wage workers are not looking for a handout. They
work hard for a living, and they deserve a fair day's pay. Our country
is enjoying a tremendous economic expansion so now really is the time
to make sure that the minimum wage workers can share in it.
My Democratic colleagues want to offer a minimum wage bill, a real
minimum wage bill, to make sure that they can share in it, and we want
to offer a small business tax bill that will actually help small
businesses. Yes, we have a small business tax bill that will help small
businesses instead of helping the rich get richer. Under this rule, we
just cannot do it.
Just this morning, a Washington Post editorial warns that these tax
cuts are much too high a price to pay for a wage increase to which they
bear very little relationship.

{time} 1400

If I may at this time read a column from The Washington Post, today's
editorial page.

Inverting the Minimum Wage. Congressional Republicans are
seeking enactment of still another batch of deceptively
packaged tax cuts whose long-term cost the Government just
cannot afford. The latest are to be voted on today in the
House in connection with the minimum-wage increase. The gloss
is that they will compensate small employers for the added
cost of the higher wage. The fact is that most of the benefit
will go to other than small employers and has nothing to do
with the wage.

Then I will skip, Mr. Speaker, because I do not want to read the
whole thing, but it is a very interesting column, and these are not my
words, these are the words of the editorial writers of the Washington
Post. Then they say,

An estimated three-fourths of the tax savings in the bill
would go to the highest income 1 percent of all the taxpayers
and 90 percent to the highest income 10 percent. The tax
savings are 11 times greater than the estimated cost to
employers of the minimum wage increase because that is the
pretext for them.

Then it goes on to say, Mr. Speaker, ``The tax cuts are too high a
price to pay for the wage increase to which they bear so little
relation.''
It goes on and on, Mr. Speaker. I think the people in this Chamber
get the picture.
I urge my colleagues to really look at this closely and see if the
title really matches the contents. I urge my colleagues to defeat the
previous question in order that we can put a Democratic alternative
forward that really does give a minimum wage and really does help small
business.
Mr. Speaker, I reserve the balance of my time.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
I really enjoy being in debates with my colleagues on the other side.
They want to argue about how we have to give and give and give, but
when it comes time for the taxpayer or the small businessperson or the
person that has made the investment to get something that is fair
treatment back, they get nothing in return from my friends. I would
like to also add that there were 48 of my colleagues on the other side
of the aisle that voted for this outrageous marriage penalty; 48
Democrats joined the majority party because it is the right thing to do
for the American families to get 1,400 more dollars rather than giving
it to Uncle Sam.
Mr. Speaker, I yield such time as he may consume to the gentleman
from California (Mr. Dreier), the chairman of the Committee on Rules.
Mr. DREIER. Mr. Speaker, I thank my friend for yielding and I
congratulate him on managing what obviously is a somewhat challenging
and controversial rule.
I happen to be one who believes very much that we have a
responsibility to put into place economic policies which will ensure
that everyone, regardless of where they are on the economic scale, has
an opportunity to improve their plight. I want to see those at the
lower end of the economic spectrum get their wages up. I want us to
encourage growth and investment and productivity so that those wages
can increase.
I do have a difficulty, however, with having the Federal Government
mandate a wage rate that frankly has the potential to jeopardize
economic growth and has the potential again to hurt most those we are
trying to assist.
Now, having said that, I realize that a majority of this House
supports an increase in the minimum wage. I am in the minority here in
believing that we should simply encourage economic growth through tax
and other investment incentives. But I am in the minority. I am in the
minority, so I feel the responsibility to do everything that we
possibly can to allow a free flow of ideas and debate on these very
important questions that are before us; and that is why we have, as the
gentleman from Texas (Mr. Sessions) has outlined, an extraordinarily
fair and balanced rule which allows all of the alternatives that are
out there to be considered. One over two, one over three. We have tax
incentives which some of us do support. So we have a wide range of
options that are there, put into place.
I will say that I happen to think that tax relief is something that
is much needed, and the issues that my friend from his summer spot in
South Boston mentioned, the tax issue, is something that enjoys
bipartisan support. The gentleman from Texas (Mr. Sessions) said that
48 Democrats joined in support of the marriage tax penalty. President
Clinton stood here during his State of the Union message and talked
about his support for that. He indicated that he was adamantly opposed
to increasing the earnings cap for retirees. Now, he is prepared to
sign it and we welcome that.
So aspects that were in that tax bill that he vetoed last year, he
has clearly indicated that he supports and we welcome that kind of
support and recognition of the fact that we as a country need to do
everything, and as a Congress, need to do everything that we can to
encourage this kind of economic growth.

Specifically, the items that are in this tax package that are
particularly beneficial, of course, allow us to deal with this health
care question by providing for the self-employed workers to deduct
their health care insurance expenses. We also, and I see my very dear
friend from New York (Mr. Rangel) here, we want to encourage community
redevelopment. We want the community renewal movement to go ahead.
Again, President Clinton has joined with Speaker Hastert in supporting
that. So I know that my friend from New York will strongly embrace that
provision that is in this measure.
So there are very, very good aspects of it; and I hope that we will
see a strong vote for this rule. But before my colleagues get a chance
to vote for the rule, I suspect that there just may be a vote on the
previous question. So in light of that, I urge my colleagues on both
sides of the aisle to join in support of the previous question so that
we can move ahead with a fair, balanced rule that allows all of the
different ideas out there to be considered, and then we will do what
Speaker Hastert said when he on the opening day of the 106th Congress
just a little over a year ago stood here and said we will allow the
House to work its will so that the majority will prevail.
Mr. MOAKLEY. Mr. Speaker, I am very happy that my chairman really has
the courage to say he is against the minimum wage. Unfortunately, many
people are hiding behind this bill who are also against the minimum
wage.
Mr. Speaker, I yield 5 minutes to the gentleman from New York (Mr.
Rangel), the ranking Democrat on the Committee on Ways and Means, who
is in favor of a real minimum-wage increase.
(Mr. RANGEL asked and was given permission to revise and extend his
remarks.)
Mr. RANGEL. Mr. Speaker, let me join in congratulating the
distinguished chairman of the Committee on Rules. His honesty in terms
of opposing the minimum wage for the lowest working employees is really
to be commended for coming forward and saying it, because like Governor
Bush, I wondered about the meanness on this side of the aisle; and it
is good to see that people are willing to say that there is a reason
behind it.

[[Page H776]]

Mr. Speaker, one can be reforming and want results if one is going to
cave in to the things that one believes in, and I would like to join
with my Senator who makes it abundantly clear that the country is
really not looking for tax cuts, but looking for us to do the right
thing, protecting Social Security, Medicare, the Patients' Bill of
Rights, affordable drugs. These are the things that the Congress, not
Republicans and not Democrats, but working together, should be doing.
There is very, very little compassion for the working people at a time
that our country is doing so great.
I oppose the rule because my colleagues do not even give us an
opportunity to have an alternative. What is the fear in just allowing
the House to work its will? There was a time that the tax-writing
committee used to be involved in taxes. We yield to the
distinguished people on the Committee on Rules to pick and choose what
they would like. But when they do not have the courage of the gentleman
from California (Mr. Dreier) to say that they are against the minimum-
wage increase, for God's sake, do not kill it by just burdening taxes
on it. Just say that we do not want reform on this side of the House of
Representatives.

How dare my colleagues say, how dare my colleagues say that the tax
provisions in this bill is to protect small businesses. That is
outrageous. It is an insult to the American people. It is clear that
two-thirds of the tax benefits, they do not go to small businesses,
they go to the richest Republicans that we have. So do what you want
politically and kill the minimum-wage bill, but for God's sake, do not
say that you are doing it fairly.
The same thing applies to the Patients' Bill of Rights. If you do not
want patients to have a bill of rights, and your leadership does not,
do not compromise and say you are coming out for it and then load it up
with hundreds of billions of dollars in tax cuts.
Mr. Speaker, it was clear to us a long time ago what our Republican
colleagues' game plan was, and that is to do absolutely nothing and get
out of this House of Representatives. And how did they intend to do it?
By getting this big $800 billion tax cut, thinking about anything you
could imagine, and having the President veto it so that you could go
home and campaign on just how we Democrats are against tax cuts. Well,
guess what? We Democrats are for tax cuts, but we also are for saving
Social Security, saving Medicare, and helping all Americans enjoy it
and not just the chosen and the blessed few.
Why is it that when my colleagues' tax cut was vetoed, they did not
move to override the veto? Could it be that they had lack of votes, or
could it be they had lack of guts? In any event, now they have to give
us an $800 billion tax cut $200 billion at a time. What does the $122
billion tax cut have to do with giving working people a buck increase
from $5.15 to $6.15? Why did my Republican colleagues wait until the
President said he would veto it before they brought it to the floor?
Many of the things that my colleagues have in the tax provision we
support. Why did they overdo it? If they really wanted to be fair, why
did they not give us a chance really to report out a tax bill that the
President will sign?
Now, if my Republican colleagues want to be against the working poor,
do it. But at least have the courage to stand up here and to say that
every time you steal one of the President's good ideas that you have to
load it up with some piece of the $800 billion tax cut until you have
to force him to veto it.
So if we want to talk about reformists with results, we better walk
away from many of the critics outside of our side of the aisle that are
talking about the way my colleagues on the other side of the aisle are
not taking care of the people's business.
Mr. Speaker, I want to thank my colleagues for seeing their way clear
to allowing the gentleman from Ohio (Mr. Traficant) to have an
amendment to this bill, and I wondered why my colleagues could not
reach beyond that to allow some of us on the tax-writing committee to
have an amendment to the tax bill.
I know one thing: my Republican colleagues may be for reform, but
they certainly are not supporting results.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
Hearing my colleagues talk about this rule would make me think that
they simply do not understand what the Committee on Rules did. First of
all, the Committee on Rules, under Republicans, has always insisted or
guaranteed that there will be a motion to recommit to the minority
party. As my recollection tells me, that rarely happened when the
Democrats were in control.
Secondly, the fairness of this rule is very obvious to everyone. We
will have a separate vote that will be on the provisions for minimum
wage from the vote for the tax package, which means if the gentleman
from New York or any of my colleagues wish to vote yes or no on minimum
wage, they will be allowed to do that. If they want to vote yes or no
on the tax package, they will be allowed to do that. If we were being
unfair, we would have put them together. Then we would have heard that
would be a poison pill, and I think that that could be said and it
would be true.
The fact of the matter is that the wisdom of this Committee on Rules
is that we are trying to present an opportunity of fairness to fully
debate the issue, to allow open votes that will take place; and I am
very, very proud of what we have done. I believe that any criticism
like this is from someone that simply has not read the rule, taken the
time to read the rule, or who is trying to dissuade someone else by not
using the facts that are at hand.
Mr. Speaker, I yield such time as he may consume to the gentleman
from Illinois (Mr. Shimkus).
(Mr. SHIMKUS asked and was given permission to revise and extend his
remarks.)

{time} 1415

Mr. SHIMKUS. Mr. Speaker, I want to thank the Committee on Rules and
commend them for the work they have done. We worked in a bipartisan
manner with a group of Republicans and Democrats, myself, the gentleman
from New York (Mr. Lazio), the gentleman from California (Mr. Condit),
and the gentleman from Alabama (Mr. Cramer) to try to reach across the
divide to address an issue that would do two things: It would increase
the minimum wage, while protecting those jobs that could be lost
through the increase of a minimum wage.
In this rule, the will of the House will be heard. I think that is
the important thing. If we want to judge the fairness of a rule, the
question is, does the House have the ability to have their will heard
on votes? We will have a debate, and we will have a vote on the tax cut
portion of this bill, so those who believe that it is important to cut
taxes to help offset the cost of small business can vote yes, and those
who do not can vote no.
Not many people in the 20th District of Illinois read the Washington
Post. I have great respect for the gentleman from Massachusetts (Mr.
Moakley), but they do read the Herald and Review from Decatur,
Illinois.
In an October 26, 1999, editorial, it reads: ``Minimum Wage Tax Break
Sensible.'' I will quote just a portion of it.
The paper stated that ``When the minimum wage increases, someone has
to pay for it, because business owners have to maintain a profit level.
The result could be higher prices or fewer jobs at minimum wage. Just
as a worker will offer his labor at an acceptable wage level, an
employer will pay workers a wage that will permit his company to earn a
profit. That is why a minimum wage increase alone won't work, and why a
bill to raise the rate linked to some tax breaks for small businesses
makes sense.''
Again, that is from the October 26 Herald and Review from Decatur,
Illinois.
So we are going to have a vote on the tax cut. We are going to have a
vote and debate on an issue that me and my friends on the conservative
side want, State flexibility. We are going to have a debate. We are
going to have a debate and a vote, and the will of the House is going
to move forward.
We are going to have a debate and we are going to have a vote on the
increase, whether it should be $1 over 3 years or $1 over 2 years. The
will of the House will have an opportunity to be spoken.
I think the rule is pretty fair and pretty balanced, but what I
really appreciate about the rule is that I think

[[Page H777]]

it respects the work that we tried to do over an entire year of keeping
a balance, trying to get to the center ground to raise the minimum wage
and cut taxes and protect jobs, a group of two Republicans and two
Democrats that worked long and hard to get to the point where we are
here today.
I want to thank the gentleman from California (Mr. Dreier), the
chairman, I want to thank the Committee on Rules, and I urge all my
colleagues to support the rule.
Mr. MOAKLEY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I would just like to correct my dear friend, the
gentleman from Texas. Since 1892, the rules of the House have
prohibited the Committee on Rules from reporting any rule that prevents
a motion to recommit from being made.
Mr. SESSIONS. Mr. Speaker, will the gentleman yield?
Mr. MOAKLEY. I yield to the gentleman from Texas.
Mr. SESSIONS. A motion to recommit with instructions.
Mr. MOAKLEY. I thought the gentleman was just talking about a motion
to recommit.
Mr. SESSIONS. With instructions.
Mr. MOAKLEY. That was added later.
Mr. SESSIONS. I thank the gentleman for helping me with that history,
Mr. Speaker.
Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from
Missouri (Mr. Gephardt), the leader of the Democratic Party in the
House of Representatives.
(Mr. GEPHARDT asked and was given permission to revise and extend his
remarks.)
Mr. GEPHARDT. Mr. Speaker, do not be fooled. This is not an
illustration of bipartisanship at work. This debate is a good
illustration of how to turn what should have been a proud bipartisan
moment for the House into a partisan action by Republican leaders. The
majority is performing a charade of bipartisanship. It is not the real
thing.
For more than 2 years, there has been a true bipartisan effort in
this House to increase the minimum wage by $1 over 2 years. This effort
has repeatedly run head on into the desire by Republican leaders to
keep this issue off the floor for good, but the bipartisan coalition
never gave up, thanks to the efforts of Members on both sides of the
aisle like the gentleman from Michigan (Mr. Bonior) and the gentleman
from New York (Mr. Quinn). Because of their persistence and because of
the insistence of the American people, Republican leaders had no choice
but to bring a minimum wage bill to the floor.
Like so many times before, Republican leaders decided if they could
not kill a popular bill they disagree with, they would kill it through
neglect. They would try and kill it, attacking it in the light of day
on the floor of the House with legislative trickery.
Today they are dispensing dollars to the wealthy through the tax bill
that is going to be attached at the end, but pennies to the working
poor. Republican leaders are forcing us to vote on a minimum wage bill
originally designed to help hard-working low-income families that is
tied to a regressive tax bill designed to give $120 billion in tax
breaks to the very wealthiest Americans. They are preventing Democrats
from even offering an alternative that would provide tax cuts targeted
to owners of small businesses and family farms, giving relief to those
who need it.
For every penny that would go to working low-income Americans,
Republicans want to give 10 cents or a dime to the wealthiest Americans
among us.
It is really emblematic of their values. Republicans do not seem able
to ever give a break to working families without making sure that they
first take care of the wealthiest in America with even greater
largesse.
We should be voting on a minimum wage that provides a real pay
increase and a tax package that provides sensible, responsible tax
relief to small businesses, just as the Democratic tax alternative
would do. We should be voting on a bill that will be signed by the
President, so we can get this minimum wage increase to the people who
need it now.
The Republican rule is designed to produce a bill that will eliminate
the possibility that we can ever get this minimum wage done this year.
The people who need it need it now. They do not need to have a bill
vetoed by the President because the bill gets joined up with a tax bill
that the President will not sign.
If we are really, truly committed to working in a bipartisan manner
and ensuring that a minimum wage bill passes this year, Members will
join me in voting against this rule and putting together a rule that
will allow us to have a tax bill joined with the minimum wage that will
get this bill signed by the President of the United States.
Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from
Missouri (Mr. Clay), the ranking member of the Committee on Education
and the Workforce, a gentleman who knows what the minimum wage is, he
has been fighting it for so long.
Mr. CLAY. Mr. Speaker, I thank the gentleman for yielding time to me.
Mr. Speaker, I rise in opposition to this rule, because it limits the
opportunity for Members to have a fair and open debate on a pocketbook
issue affecting millions of workers.
First, it denies us an opportunity to offer a Democratic substitute
that would phase in a $1 increase over a 2-year period. This
parliamentary maneuver bars Members from debating and amending
provisions of the bill that repeal overtime pay for millions of
employees working in computers, sales, and funeral services.
This maneuver is even more insulting to Members of this body because
the effect of these overtime provisions were never considered in this
Congress by the Committee on Education and the Workforce, or evaluated
by expert witnesses to determine what impact they may have on the work
force.
Second, Mr. Speaker, the rule automatically includes the DeMint
amendment, which will destroy the concept of a Federal minimum wage by
allowing 50 States to enact 50 different Federal minimum wage
provisions.
What a disaster, Mr. Speaker. What an administrative nightmare: fifty
States, some of them competing against each other to see who can reduce
their State's minimum wage to a level as close to Mexico's and other
Nations that exploit their workers.
Mr. Speaker, this House should not be in the business of relegating
our workers to slave wages in order to compete with cruel, insensitive
economic systems of Third World countries. This rule should be opposed
because it abuses the House rules, because it violates fair play, and
because it stacks the deck against American workers. I urge its defeat,
Mr. Speaker.
Mr. MOAKLEY. Mr. Speaker, I yield 5 minutes to the gentleman from
Michigan (Mr. Bonior), the Democratic whip.
Mr. BONIOR. Mr. Speaker, I thank the gentleman for yielding time to
me.
Mr. Speaker, the dictionary defines ``outrage'' as a forcible
violation of others' rights, and a gross or wanton offense or
indignity. That definition could easily apply to this rule. But what
else can we expect when the Republican leader once again this year
tells the American people that raising the minimum wage is, and I quote
``the wrong thing?''
Let me tell the Members what Democrats think is wrong, Mr. Speaker.
We think it is wrong that even as our economy is surging ahead,
millions of Americans are left behind. They are the workers who earn
the minimum wage. These are the folks that look after our children at
day care, that take care of our parents and our grandparents when they
are sick. These are the folks who work in our hospitals, who clean our
offices.
Most of them are women. They have families of their own, in many
instances. They struggle to keep a roof over their heads, the heads of
their children, food on the table; to give their kids a better life, a
little bit of hope; to spend some time with them, but they cannot spend
any time with them because they are making $10,700 a year, $2,300 below
the poverty level, if they have two children.
What do they end up doing? They are out there working two and often
three jobs, and it is not right. They deserve a raise, just like the
rest of America. By providing a $1 increase over 2 years, our plan will
help them achieve just that.
Some may ask, what is the difference between a $1 increase over 2
years or $1 over 3 years? The answer to that is,

[[Page H778]]

$1,000. I know some of my Republican leadership friends may seem to
think, well, that is pocket change. That is not a lot of money. But to
a poverty wage worker, it can make all the difference in the world. It
can make a difference on whether their children get another pair of
blue jeans, whether they can meet the bills at the end of the month,
whether they may even have a little left over to go to the movies. It
makes a heck of a difference.
Our initiative does not stop with providing a fair wage, Mr. Speaker.
We understand that small businesses are creating most of the jobs in
this country and we want to help them. That is why our plan expands the
tax relief for family businesses and family farms. It provides for the
deductibility of health care premium insurance. Our plan offers a
higher minimum wage to workers who have earned it, and tax relief to
the businesses who need it.
Under the outrageous rule that we have before us right now, it is a
plan we will not even have a fair chance to consider. Instead, the
leadership on this side of the aisle is presenting us with an elaborate
scheme. They will provide a wage increase all right, but only if it is
tied to this jumbo tax cut for the wealthy and the super rich, tax cuts
that are reckless and that are enormous.
Their message basically is this, to working families: Sure, we will
give you a little bologna sandwich, but first you have to buy my
friends who belong to the country club a really nice, thick, juicy
steak dinner. Mr. Speaker, we have news for the Republican leaders, and
it is that the minimum wage was never intended to become a meal ticket
for their fat cat friends.
Mr. Speaker, what the Republican leaders propose is not policy-
making, it is a shell game. No wonder the President has pledged that he
will veto the Republican plan. Whether we agree with it or not, every
Member of this House deserves a chance to consider our substitute, but
this rule would deny us that opportunity, and that is why we are
fighting it.
We will not be denied. We will offer motions to recommit that will
give workers a fair minimum wage and provide real tax relief for small
businesses and family farms.

{time} 1430

Mr. Speaker, our plan is the only one that provides the raise that
workers have earned and the tax relief small business and family farms
need. Vote against this outrageous rule. Bring back a rule that will
give us some sense of equity and fairness and stand with us for
America's workers, for small business, for the family farmer. We are
not asking for anything more; and by God, the country deserves nothing
less.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, when I hear the debate on the other side, the debate is
as though these Republicans have not allowed a fair and open rule, a
great vote for people who think we ought to raise the minimum wage and
a great vote and an opportunity for small businesses, men and women who
create opportunity for America. You would think by listening to the
other side that they do not want to create opportunity and jobs and
growth and happiness and the opportunity for the next generation to be
employed.
I want to stand up and say that my Republican Party has the
provisions that accelerate the increase and the self-employed health
insurance deduction to 100 percent because we want people to be able to
have, not only health insurance, we want people to have their own
doctors; that we want to do the things that will extend work
opportunities and tracks credits to extend welfare to work.
We want to put America to work, want to have opportunity and jobs
that are available for everyone. That is what this fair and open rule
is about.
Mr. Speaker, I yield 3 minutes to the gentlewoman from Perry
Township, Ohio (Ms. Pryce) who sits on the Committee on Rules with me.
Ms. PRYCE of Ohio. Mr. Speaker, I rise in support of this very fair
rule which will allow the House to work its will on the question of
raising the minimum wage and providing tax relief to the very
businesses that will pay the cost of this new Federal mandate.
Now, no matter what my colleagues' position may be on the minimum
wage or on tax relief, they will have an opportunity to make their
views very clear through the procedure by which we will consider these
two bills. Now what could be fairer?
For those who support this minimum wage, this rule makes in order
legislation to increase it by a dollar over 3 years. If that table is
not fast enough, the rule allows Members to vote for a Democrat
amendment that increases the minimum wage by $1 over 2 years.
Now, of course, many of my colleagues do not think the government
should play any role in setting the wages and telling businesses what
to pay employees. Even these Members will have at least two
opportunities to make their disapproval known when they vote against
the Martinez-Traficant amendment and final passage.
Whatever one's view is on the minimum wage, I hope that we all
recognize that this policy is not free. Someone actually has to pay the
higher wages. Those who pay the highest prices are the small businesses
across this Nation, the engines of our economy, those businesses which
are creating jobs for some of our workers who are the very, very
hardest to employ.
That is why this rule also allows the House to vote on tax relief for
these small companies. The mom and pop store fronts and the new start-
up businesses, the dreams of our country's entrepreneurs.
Under this rule, Members can register their support for these
businesses by voting for legislation that increases the self-employed
health insurance deduction to 100 percent, reduces the death tax so
that family businesses can be passed on from one generation to the
next. It increases the deduction for business meal expenses, and it
reforms pension laws to help businesses offer more retirement security
to their workers.
All of these changes will be helpful to the businessmen and women who
are responsible for the innovations and job creation that are making
this economy so very strong.
Mr. Speaker, we are dealing with some controversial issues today on
which Members of the House have very, very different views. But this
rule gives all Members a fair opportunity to express their position and
let the House work its will.
Many of my colleagues on the other side of the aisle are not happy,
but believe me, Mr. Speaker, many of our colleagues on this side of the
aisle are not happy either; and it is my experience that that usually
means we have a pretty good rule.
I urge all of my colleagues to support it.
Mr. MOAKLEY. Mr. Speaker, I yield 1 minute to the gentleman from Ohio
(Mr. Kucinich).
(Mr. KUCINICH asked and was given permission to revise and extend his
remarks.)
Mr. KUCINICH. Mr. Speaker, I rise today to support raising the
minimum wage over a period of 2 years instead of 3 years. The current
minimum wage is $5.15 per hour. At this rate, a full-time year-round
minimum wage earner in the United States makes approximately $10,712
per year. In 1998, the yearly salary determined necessary for a family
of three to rise above the poverty level in this country was $13,003,
an amount $2,291 more than the minimum wage salary provides. Clearly,
the current minimum wage is too low.
Congress has already inexcusably allowed the value of the minimum
wage to fall 21 percent lower than in 1979. If the minimum wage is not
increased by the year 2001, recent studies show that the inflation
adjusted value will fall to $4.90 per hour.
It is essential that the minimum wage is raised over the course of 2
years instead of 3. That is why I will support the Traficant amendment,
and I urge everyone to support the Traficant amendment.
Mr. MOAKLEY. Mr. Speaker, I yield 3 minutes to the gentleman from
Texas (Mr. Stenholm).
(Mr. STENHOLM asked and was given permission to revise and extend his
remarks.)
Mr. STENHOLM. Mr. Speaker, the previous speaker was right. Not all of
us are happy with this rule. I believe it deals fairly with the minimum
wage question. But I continue to not understand why the majority party
continues to refuse to allow a substitute

[[Page H779]]

tax bill when there are sufficient Members on both sides of the aisle
who I believe would like our version better than the version that is
put before us.
But here again, the fundamental question is why not allow a simple
vote? Why not allow the package put together by the gentleman from New
York (Mr. Rangel) and the gentleman from Tennessee (Mr. Tanner) to have
the opportunity to have the will of the House worked?
The bill that we will be voting on today continues the fiscal
irresponsible pattern of legislation coming from the majority side
that, once again, will squander our national surplus and our
opportunity to deal with Social Security and Medicare. This, when one
adds up this $122 billion unpaid for, will amount to something over
$400 billion now voted by the House and by the Senate in spending the
surplus that is not yet real.
The tax bill that this rule will allow is the latest in the series of
tax bills that will drain the projected budget surplus drip by drip
without regard for the consequences.
If we pass this bill today, it will be fiscally reckless for this
body to continue to rush down this path of passing tax cuts and
spending bills without a road map.
Why do we continue to casually waive the budget rules? Why do we just
continue to come to this floor of the House without first bringing a
road map so we can deal with how we are going to spend money and cut
taxes this year?
The tax bill before us is simply a political document that will never
become law. We know this. It appears the majority wants a political
issue rather than dealing with the estates of family farmers and small
businessmen and women.
If my colleagues are truly concerned about estate tax relief, which I
am and have been, I very much appreciate what could have been an
opportunity to vote on an immediate exemption exclusion of $4 million
estates immediately. But, yet, the bill that we have before us pays
more attention to estates over $10 million. I do not understand this.
The President has promised that he will sign into law the Democratic
tax package. The fact the leadership will not allow the House to vote
on this amendment suggests they are more interested in keeping a
political issue, which I fail to understand, than they are on actually
providing tax relief to small businesses.
This rule is unfair to our children and grandchildren who will face
the consequences of our fiscal irresponsibility if this bill should
become law, which it will not.
What I do not understand is why we never allow the House of
Representatives to work our will so that we might send something to the
President that the President will actually sign. Mr. Speaker, I ask
that simple question. Why not let the House be the House?
Mr. MOAKLEY. Mr. Speaker, I yield 2 minutes to the gentleman from
North Carolina (Mr. Watt).
Mr. WATT of North Carolina. Mr. Speaker, I was sitting in my office
not intending to participate in this debate and really got incensed. I
sat there, and I wondered, what must the American people be thinking is
going on here? What must my Republican colleagues be thinking? Do they
think the American people are stupid? What are they doing?
It is obvious that their leadership does not support the minimum wage
increase, and they are trying to kill the minimum wage increase by
loading it up with an irresponsible tax cut that benefits the richest
people in America. Are we stupid? Do they think we are stupid? That is
exactly what is going on here.
The President has said, I will veto this bill. We cannot stand here
on the floor and say, hey, we are being bipartisan. There is no
bipartisanship here.
All we are trying to do is get a wage increase for people in America
who need it and want it. All they are trying to do is kill that minimum
wage increase. They will try anything and everything to accomplish that
objective.
We should not sit here and pretend that we are doing something being
bipartisan. There is nobody being bipartisan in this House. If they
were being bipartisan, they would separate these two bills, let them be
voted up or down, give us the opportunity to offer amendments on both
bills, and let the House work its will.
That is all we are asking for in this equation. It is quite obvious
that the Republicans are not going to give it to us and not going to
give the opportunity to the American people to have a wage increase.
Mr. MOAKLEY. Mr. Speaker, just directing my conversation to the
gentleman from Texas (Mr. Sessions), is he the only remaining speaker?
Mr. SESSIONS. Mr. Speaker, I have one additional speaker who I am
going to give 7 minutes to, rundown the time to where we have a minute
or so left, and then I will reserve 1 minute for myself when that
speaker is through.
Mr. MOAKLEY. Then I would be delighted to sit back and listen to the
gentleman's speaker for 7 minutes right now.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
In response to both gentlemen who have just spoken, the fact of the
matter is that the Republican House of Representatives is not going to
send a tax increase, which is what President Clinton wants to sign. The
American people understand this. The bills that the President wants to
sign are tax increases that take money away from people.
Forty-eight of my colleagues on the Democrat side came across just
within weeks to sign the marriage penalty. The President of the United
States cannot join us.
What we are doing today is talking about a minimum wage that is good
for America and great for the people who employ those people, small
businesses.
Mr. Speaker, I yield 7 minutes to the gentleman from Ohio (Mr.
Traficant).
(Mr. TRAFICANT asked and was given permission to revise and extend
his remarks.)
Mr. TRAFICANT. Mr. Speaker, I disagree with the Democrat leadership
on their analysis of this bill. I support the rule. I will support the
tax break. I will support an amendment to increase the minimum wage $1
over a 24-month span, and I will vote for final passage when they are
linked together.
My district desperately needs an increase in the minimum wage. The
sharpest politician to ever sit on Independence Avenue, with great
political wisdom, owns two-thirds of the votes, and there are many
political machinations that follow down the road on this bill. But a
tax break for the boss who raises the wages of my workers is a decent
trade-off for me.
Am I totally crazy about their tax break? Not totally. There is a
thing called a conference. But in the last 4 years, we have had two
increases in the minimum wage that were under Republican Party
leadership.
The Republicans could have brought a bill out here today that did not
have an opportunity for $1 over 2 years. They could have left it $1
over 3 years. They did that. I thank them for that. But I want to also
say this, those who say that the Republican Party's tactics are simply
mean spirited, trying to kill a minimum wage are not truthful.

{time} 1445

Their concerns over inflation causing a downward spiral that could
hurt my workers is a valid concern that I share, just as they do. I
believe our economy is strong enough that it can absorb both.
But I think the point that I would like to make today is this: there
are many people who come from different backgrounds. I look around and
I see great Members coming from very, very poor families. I come from a
very poor family. My dad finally got on his feet maybe when I was about
11 years old. My dad never worked for a poor man.
This business of bashing one another should stop. Is this bill good
for America or not? My Democrat colleagues are saying it is not. I am a
Democrat. I am saying it is, after it goes through the conference and
after we go through the political machinations to work out those
problems. That is what the process is all about, my colleagues.
But let us look at this. How many times do we come to the floor that
we bash, that we pit old against the young; rich against the poor;
black against the white; man against the woman; worker against the
company? My colleagues, without a company there is no worker. Without
an entrepreneur there is no company. I think the Democrat Party has got
to look at this issue.

[[Page H780]]

I am appealing to the Democrat Party to pass the rule. I do not want
to see the Republican Party on their own pass the rule and give an
opportunity for a minimum-wage increase on their own, because President
Clinton is sharp. I believe if the Clinton White House and the
Republican leadership, whose intentions I believe are honorable, were
to get together in reasonableness on that tax scheme, we will have a
minimum-age increase, and my people desperately need it.
My colleagues, the gas prices in America are beginning to approach $2
a gallon. So I want to say this: I want to commend the Republican Party
and the Republican leadership for bringing out an opportunity for a
minimum-wage increase and, yes, politically machinating the process to
accommodate some of their goals. That is what we do here. We are not
the Rotary.
In closing, Democrats, my amendment does this: the bill says there is
a $1 increase over 3 years. The Traficant bill would accelerate the
minimum wage of $1 over 2 years. I am asking for a positive vote. I
will vote ``yes'' on the previous question; I will vote ``yes'' on the
rule.
And I will also say this in closing: I served on the majority and on
the minority; and we have had, in my opinion, much fairer rules coming
from this majority party than we did when I was in the majority. That
is telling it like it is.
Mr. MOAKLEY. Mr. Speaker, I yield myself such time as I may consume.
Mr. Speaker, I urge Members to vote ``no'' on the previous question.
If the previous question is defeated, I will offer an amendment to the
rule that will allow the Democrats to offer a substitute to both the
minimum-wage bill and to the small business tax bill.
It is extremely unfortunate that the majority leadership in this
House has shut the minority out of the amendment process on these two
very critical bills. The two substitutes proposed by the Democrats are
reasonable, and they are responsible alternatives to the two bills
being offered by the Republicans. Members deserve an opportunity to
choose between these two approaches. So, Mr. Speaker, I urge Members to
vote ``no'' on the previous question so that we may consider these two
sensible alternatives.

The Vote on the Previous Question: What It Really Means

This vote, the vote on whether to order the previous
question on a special rule, is not merely a procedural vote.
A vote against ordering the previous question is a vote
against the Republican majority agenda and a vote to allow
the opposition, at least for the moment, to offer an
alternative plan. It is a vote about what the House should be
debating.
Mr. Clarence Cannon's Precedents of the House of
Representatives, (VI, 308-311) describes the vote on the
previous question on the rule as ``a motion to direct or
control the consideration of the subject before the House
being made by the Member in charge.'' To defeat the previous
question is to give the opposition a chance to decide the
subject before the House. Cannon cities the Speaker's ruling
of January 13, 1920, to the effect that ``the refusal of the
House to sustain the demand for the previous question passes
the control of the resolution to the opposition'' in order to
offer an amendment. On March 15, 1909, a member of the
majority party offered a rule resolution. The House defeated
the previous question and a member of the opposition rose to
a parliamentary inquiry, asking who was entitled to
recognition. Speaker Joseph G. Cannon (R-Illinois) said:
``The previous question having been refused, the gentleman
from New York, Mr. Fitzgerald, who had asked the gentleman to
yield to him for an amendment, is entitled to the first
recognition.
Because the vote today may look bad for the Republican
majority they will say ``the vote on the previous question is
simply a vote on whether to proceed to an immediate vote on
adopting the resolution . . . [and] has no substantive
legislation or policy implications whatsoever.'' But that is
not what they have always said. Listen to the Republican
Leadership Manual on the Legislative Process in the United
States House of Representatives, (6th edition, page 135).
Here's how the Republicans describe the previous question
vote in their own manual: ``Although it is generally not
possible to amend the rule because the majority Member
controlling the time will not yield for the purpose of
offering an amendment, the same result may be achieved by
voting down the previous question on the rule . . . When the
motion for the previous question is defeated, control of the
time passes to the Member who led the opposition to ordering
the previous question. That Member, because he then controls
the time, may offer an amendment to the rule, or yield for
the purpose of amendment.''
Deschler's Procedure in the U.S. House of Representatives,
the subchapter titled ``Amending Special Rules'' states: ``a
refusal to order the previous question on such a rule [a
special rule reported from the Committee on Rules] opens the
resolution to amendment and further debate.'' (Chapter 21,
section 21.2) Section 21.3 continues: ``Upon rejection of the
motion for the previous question on a resolution reported
from the Committee on Rules, control shifts to the Member
leading the opposition to the previous question, who may
offer a proper amendment or motion and who controls the time
for debate thereon.''
The vote on the previous question on a rule does have
substantive policy implications. It is one of the only
available tools for those who oppose the Republican
majority's agenda to offer an alternative plan.

Mr. Speaker, I submit for the Record the text of the amendments I
have just referred to and other extraneous materials:

Previous Question for H. Res. Small Business Tax and Minimum Wage
Increase H.R. 3081 and H.R. 3846--March 9, 2000

Strike all after the resolving clause and insert in lieu
thereof the following:
Providing for consideration of the bill (H.R. 3081) to
increase the Federal minimum wage and to amend the Internal
Revenue Code of 1986 to provide tax benefits for small
businesses, and for other purposes, and for consideration of
the bill (H.R. 3846) to amend the Fair Labor Standards Act of
1938 to increase the minimum wage, and for other purposes.
Resolved, That upon the adoption of this resolution it
shall be in order without intervention of any point of order
to consider in the House the bill (H.R. 3081) to increase the
Federal minimum wage and to amend the Internal Revenue Code
of 1986 to provide tax benefits for small businesses, and for
other purposes. The bill shall be considered as read for
amendment. In lieu of the amendment recommended by the
Committee on Ways and Means now printed in the bill, the
amendment in the nature of a substitute printed in part A of
the report of the Committee on Rules accompanying this
resolution shall be considered as adopted. The previous
question shall be considered as ordered on the bill, as
amended, and on any further amendment thereto to final
passage without intervening motion except: (1) one hour of
debate on the bill, as amended, equally divided and
controlled by the chairman and ranking minority member of the
Committee on Ways and Means; (2) the amendment in the nature
of a substitute printed in section 4 of this resolution, if
offered by Representative Rangel or a designee, which shall
be in order without intervention of any point of order, shall
be considered as read, and shall be separately debatable for
one hour equally divided and controlled by the proponent and
an opponent; and (3) one motion to recommit with or without
instructions.
Sec. 2. After disposition of H.R. 3081, it shall be in
order without intervention of any point of order to consider
in the House the bill (H.R. 3846) to amend the Fair Labor
Standards Act of 1938 to increase the minimum wage, and for
other purposes. The bill shall be considered as read for
amendment. The previous question shall be considered as
ordered on the bill and on any amendment thereto to final
passage without intervening motion except: (1) one hour of
debate on the bill equally divided and controlled by the
chairman and ranking minority member of the Committee on
Education and the Workforce; (2) the amendment in the nature
of a substitute printed in section 5 of this resolution, if
offered by Representative Bonior or a designee, which shall
be in order without intervention of any point of order, shall
be considered as read, and shall be separately debatable for
one hour equally divided and controlled by the proponent and
an opponent; and (3) one motion to recommit with or without
instructions.
Sec. 3. (a) In the engrossment of H.R. 3081, the Clerk
shall--
(1) await the disposition of H.R. 3846;
(2) add the text of H.R. 3846, as passed by the House, as
new matter at the end of H.R. 3081;
(3) conform the title of H.R. 3081 to reflect the addition
of the text of H.R. 3846 to the engrossment;
(4) assign appropriate designations to provisions within
the engrossment; and
(5) conform provisions for short titles within the
engrossment.
(b) Upon the addition of the text of H.R. 3846 to the
engrossment of H.R. 3081, H.R. 3846 shall be laid on the
table.
Sec. 4. The second amendment specified in the first section
of this resolution is as follows:
Strike all after the enacting clause, and insert the
following:

TITLE II--AMENDMENTS OF INTERNAL REVENUE CODE OF 1986

SEC. 200. SHORT TITLE.

(a) Short Title.--This title may be cited as the ``Small
Business Tax Relief Act of 2000''.
(b) Table of Contents.--

TITLE II--AMENDMENTS OF INTERNAL REVENUE CODE OF 1986

Sec. 200. Table of contents.

[[Page H781]]

Subtitle A--Permanent Extension of Work Opportunity Credit and Welfare-
to-Work Credit

Sec. 201. Work opportunity credit and welfare-to-work credit; repeal of
age limitation on eligibility of food stamp recipients.

Subtitle B--Deduction for 100 Percent of Health Insurance Costs of
Self-Employed Individuals

Sec. 211. Deduction for 100 percent of health insurance costs of self-
employed individuals.

Subtitle C--Pension Provisions

Sec. 221. Treatment of multiemployer plans under section 415.
Sec. 222. Early retirement limits for certain plans.
Sec. 223. Certain post-secondary educational benefits provided by an
employer to children of employees excludable from gross
income as a scholarship.

Subtitle D--Business Tax Relief

Sec. 231. Increase in expense treatment for small businesses.
Sec. 232. Small businesses allowed increased deduction for meal and
entertainment expenses.
Sec. 233. Restoration of deduction for travel expenses of spouse, etc.
accompanying taxpayer on business travel.
Sec. 234. Increased credit and amortization deduction for reforestation
expenditures.
Sec. 235. Repeal of modification of installment method.

Subtitle E--Expansion of Incentives for Public Schools

Sec. 241. Expansion of incentives for public schools.

Subtitle F--Increased Estate Tax Relief for Family-Owned Business
Interests

Sec. 251. Increase in estate tax benefit for family-owned business
interests.

Subtitle G--Revenue Offsets

Part I--Revision of Tax Rules on Expatriation

Sec. 261. Revision of tax rules on expatriation.

Part II--Disallowance of Noneconomic Tax Attributes

SUBPART A--DISALLOWANCE OF NONECONOMIC TAX ATTRIBUTES; INCREASE IN
PENALTY WITH RESPECT TO DISALLOWED NONECONOMIC TAX ATTRIBUTES

Sec. 266. Disallowance of noneconomic tax attributes.
Sec. 267. Increase in substantial underpayment penalty with respect to
disallowed noneconomic tax attributes.
Sec. 268. Penalty on marketed tax avoidance strategies which have no
economic substance, etc.
Sec. 269. Effective dates.

SUBPART B--LIMITATIONS ON IMPORTATION OR TRANSFER OF BUILT-IN LOSSES

Sec. 271. Limitation on importation of built-in losses.
Sec. 272. Disallowance of partnership loss transfers.

Part III--Estate and Gift Tax Offsets

Sec. 276. Valuation rules for transfers involving nonbusiness assets.
Sec. 277. Correction of technical error affecting largest estates.

Part IV--Other Offsets

Sec. 281. Consistent amortization periods for intangibles.
Sec. 282. Modification of foreign tax credit carryover rules.
Sec. 283. Recognition of gain on transfers to swap funds.
Subtitle A--Permanent Extension of Work Opportunity Credit and Welfare-
to-Work Credit

SEC. 201. WORK OPPORTUNITY CREDIT AND WELFARE-TO-WORK CREDIT;
REPEAL OF AGE LIMITATION ON ELIGIBILITY OF FOOD
STAMP RECIPIENTS.

(a) Permanent Extension.--
(1) In general.--
(A) Section 51(c) of the Internal Revenue Code of 1986 is
amended by striking paragraph (4).
(B) Section 51A of such Code is amended by striking
subsection (f).
(2) Effective date.--The amendments made by this subsection
shall apply to individuals who begin work for the employer
after December 31, 2001.
(b) Repeal of Age Limitation on Eligibility of Food Stamp
Recipients.--
(1) In general.--Subparagraph (A) of section 51(d)(8) of
such Code is amended to read as follows:
``(A) In general.--The term `qualified food stamp
recipient' means any individual who is certified by the
designated local agency as being a member of a family--
``(i) receiving assistance under a food stamp program under
the Food Stamp Act of 1977 for the 6- month period ending on
the hiring date, or
``(ii) receiving such assistance for at least 3 months of
the 5-month period ending on the hiring date, in the case of
a member of a family who ceases to be eligible for such
assistance under section 6(o) of the Food Stamp Act of
1977.''
(2) Effective date.--The amendment made by this subsection
shall apply to individuals who begin work for the employer
after the date of the enactment of this Act.
Subtitle B--Deduction for 100 Percent of Health Insurance Costs of
Self-Employed Individuals

SEC. 211. DEDUCTION FOR 100 PERCENT OF HEALTH INSURANCE COSTS
OF SELF-EMPLOYED INDIVIDUALS.

(a) In General.--Paragraph (1) of section 162(l) of the
Internal Revenue Code of 1986 is amended to read as follows:
``(1) Allowance of deduction.--In the case of an individual
who is an employee within the meaning of section 401(c)(1),
there shall be allowed as a deduction under this section an
amount equal to 100 percent of the amount paid during the
taxable year for insurance which constitutes medical care for
the taxpayer and the taxpayer's spouse and dependents.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2000.
Subtitle C--Pension Provisions

SEC. 221. TREATMENT OF MULTIEMPLOYER PLANS UNDER SECTION 415.

(a) Compensation Limit.--Paragraph (11) of section 415(b)
of the Internal Revenue Code of 1986 (relating to limitation
for defined benefit plans) is amended to read as follows:
``(11) Special limitation rule for governmental and
multiemployer plans.--In the case of a governmental plan (as
defined in section 414(d)) or a multiemployer plan (as
defined in section 414(f)), subparagraph (B) of paragraph (1)
shall not apply.''.
(b) Combining and Aggregation of Plans.--
(1) Combining of plans.--Subsection (f) of section 415 of
such Code (relating to combining of plans) is amended by
adding at the end the following:
``(3) Exception for multiemployer plans.--Notwithstanding
paragraph (1) and subsection (g), a multiemployer plan (as
defined in section 414(f)) shall not be combined or
aggregated with any other plan maintained by an employer for
purposes of applying the limitations established in this
section, except that such plan shall be combined or
aggregated with another plan which is not such a
multiemployer plan solely for purposes of determining whether
such other plan meets the requirements of subsection
(b)(1)(A).''.
(2) Conforming amendment for aggregation of plans.--
Subsection (g) of section 415 of such Code (relating to
aggregation of plans) is amended by striking ``The
Secretary'' and inserting ``Except as provided in subsection
(f)(3), the Secretary''.
(c) Effective Date.--The amendments made by this section
shall apply to years beginning after December 31, 1999.

SEC. 222. EARLY RETIREMENT LIMITS FOR CERTAIN PLANS.

(a) In General.--Subparagraph (F) of section 415(b)(2) of
the Internal Revenue Code of 1986 is amended to read as
follows:
``(F) Multiemployer plans and plans maintained by
governments and tax exempt organizations.--In the case of a
governmental plan (within the meaning of section 414(d)), a
plan maintained by an organization (other than a governmental
unit) exempt from tax under this subtitle, a multiemployer
plan (as defined in section 414(f)), or a qualified merchant
marine plan--
``(i) subparagraph (C) shall be applied--

``(I) by substituting `age 62' for `social security
retirement age' each place it appears, and
``(II) as if the last sentence thereof read as follows:
`The reduction under this subparagraph shall not reduce the
limitation of paragraph (1)(A) below (i) 80 percent of such
limitation as in effect for the year, or (ii) if the benefit
begins before age 55, the equivalent of such 80 percent
amount for age 55.', and

``(ii) subparagraph (D) shall be applied by substituting
`age 65' for `social security retirement age' each place it
appears.
For purposes of this subparagraph, the term `qualified
merchant marine plan' means a plan in existence on January 1,
1986, the participants in which are merchant marine officers
holding licenses issued by the Secretary of Transportation
under title 46, United States Code.''.
(b) Effective Date.--The amendment made by this section
shall apply to years beginning after December 31, 1999.

SEC. 223. CERTAIN POST-SECONDARY EDUCATIONAL BENEFITS
PROVIDED BY AN EMPLOYER TO CHILDREN OF
EMPLOYEES EXCLUDABLE FROM GROSS INCOME AS A
SCHOLARSHIP.

(a) In General.--Section 117 of the Internal Revenue Code
of 1986 (relating to qualified scholarships) is amended by
adding at the end the following:
``(e) Employer-Provided Post-Secondary Educational Benefits
Provided to Children of Employees.--
``(1) In general.--In determining whether any amount is a
qualified scholarship for purposes of subsection (a), the
fact that such amount is provided in connection with an
employment relationship shall be disregarded if--
``(A) such amount is provided by the employer to a child
(as defined in section 151(c)(3)) of an employee or former
employee of such employer,
``(B) such amount is provided pursuant to a plan which
meets the nondiscrimination requirements of subsection
(d)(3), and
``(C) amounts provided under such plan are in addition to
any other compensation payable to employees and such plan
does not provide employees with a choice between such amounts
and any other benefit.

[[Page H782]]

For purposes of subparagraph (C), the business practices of
the employer (as well as such plan) shall be taken into
account.
``(2) Dollar limitations.--
``(A) Per child.--The amount excluded from the gross income
of the employee by reason of paragraph (1) for a taxable year
with respect to amounts provided to each child of such
employee shall not exceed $2,000.
``(B) Aggregate limit.--The amount excluded from the gross
income of the employee by reason of paragraph (1) for a
taxable year (after the application of subparagraph (A))
shall not exceed the excess of the dollar amount contained in
section 127(a)(2) over the amount excluded from the
employee's gross income under section 127 for such year.
``(3) Principal shareholders and owners.--Paragraph (1)
shall not apply to any amount provided to any child of any
individual if such individual (or such individual's spouse)
owns (on any day of the year) more than 5 percent of the
stock or of the capital or profits interest in the employer.
``(4) Special rules of application.--In the case of an
amount which is treated as a qualified scholarship by reason
of this subsection--
``(A) subsection (a) shall be applied without regard to the
requirement that the recipient be a candidate for a degree,
and
``(B) subsection (b)(2)(A) shall be applied by substituting
`section 529(e)(5)' for `section 170(b)(1)(A)(ii)'.
``(5) Certain other rules to apply.--Rules similar to the
rules of paragraphs (4), (5), and (7) of section 127(c) shall
apply for purposes of this subsection.''
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2000.
Subtitle D--Business Tax Relief

SEC. 231. INCREASE IN EXPENSE TREATMENT FOR SMALL BUSINESSES.

(a) In General.--Paragraph (1) of section 179(b) of the
Internal Revenue Code of 1986 (relating to dollar limitation)
is amended to read as follows:
``(1) Dollar limitation.--The aggregate cost which may be
taken into account under subsection (a) for any taxable year
shall not exceed $30,000.''.
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2000.

SEC. 232. SMALL BUSINESSES ALLOWED INCREASED DEDUCTION FOR
MEAL AND ENTERTAINMENT EXPENSES.

(a) In General.--Subsection (n) of section 274 (relating to
only 50 percent of meal and entertainment expenses allowed as
deduction) is amended by adding at the end the following new
paragraph:
``(4) Special rule for small businesses.--
``(A) In general.--In the case of any taxpayer which is a
small business, paragraph (1) shall be applied by
substituting for `50 percent'--
``(i) `55 percent' in the case of taxable years beginning
in 2001 and 2002, and
``(ii) `60 percent' in the case of taxable years beginning
in 2003, 2004, 2005 and 2006, and
``(iii) `65 percent' in the case of taxable years beginning
after 2006.
``(B) Small business.--For purposes of this paragraph, the
term `small business' means, with respect to expenses paid or
incurred during any taxable year--
``(i) any C corporation which meets the requirements of
section 55(e)(1) for such year, and
``(ii) any S corporation, partnership, or sole
proprietorship which would meet such requirements if it were
a C corporation.''
(b) Effective Date.--The amendment made by subsection (a)
shall apply to taxable years beginning after December 31,
2000.

SEC. 233. RESTORATION OF DEDUCTION FOR TRAVEL EXPENSES OF
SPOUSE, ETC. ACCOMPANYING TAXPAYER ON BUSINESS
TRAVEL.

(a) In General.--Subsection (m) of section 274 of the
Internal Revenue Code of 1986 (relating to additional
limitations on travel expenses) is amended by striking
paragraph (3).
(b) Effective Date.--The amendment made by this section
shall apply to taxable years beginning after December 31,
2000.

SEC. 234. INCREASED CREDIT AND AMORTIZATION DEDUCTION FOR
REFORESTATION EXPENDITURES.

(a) Increase in Credit.--Paragraph (1) of section 48(b) of
the Internal Revenue Code of 1986 (relating to reforestation
credit) is amended by striking ``10 percent'' and inserting
``20 percent''.
(b) Reduction in Amortization Period.--Subsection (a) of
section 194 of such Code (relating to amortization of
reforestation expenditures) is amended--
(1) by striking ``84 months'' and inserting ``36 months'',
and
(2) by striking ``84-month period'' and inserting ``36-
month period''.
(c) Increase in Maximum Amount Which May Be Amortized.--
Paragraph (1) of section 194(b) of such Code is amended by
striking ``$10,000 ($5,000'' and inserting ``$20,000
($10,000''.
(d) Effective Date.--The amendments made by this section
shall apply to taxable years beginning after December 31,
2000.

SEC. 235. REPEAL OF MODIFICATION OF INSTALLMENT METHOD.

(a) In General.--Subsection (a) of section 536 of the
Ticket to Work and Work Incentives Improvement Act of 1999
(relating to modification of installment method and repeal of
installment method for accrual method taxpayers) is repealed
effective with respect to sales and other dispositions
occurring on or after the date of the enactment of such Act.
(b) Applicability.--The Internal Revenue Code of 1986 shall
be applied and administered as if that subsection (and the
amendments made by that subsection) had not been enacted.
Subtitle E--Expansion of Incentives for Public Schools

SEC. 241. EXPANSION OF INCENTIVES FOR PUBLIC SCHOOLS.

(a) In General.--Chapter 1 of the Internal Revenue Code of
1986 is amended by adding at the end the following new
subchapter:

``Subchapter X--Public School Modernization Provisions

``Part I. Credit to holders of qualified public school modernization
bonds.
``Part II. Qualified school construction bonds.
``Part III. Incentives for education zones.

``PART I--CREDIT TO HOLDERS OF QUALIFIED PUBLIC SCHOOL MODERNIZATION
BONDS

``Sec. 1400F. Credit to holders of qualified public school
modernization bonds.

``SEC. 1400F. CREDIT TO HOLDERS OF QUALIFIED PUBLIC SCHOOL
MODERNIZATION BONDS.

``(a) Allowance of Credit.--In the case of a taxpayer who
holds a qualified public school modernization bond on a
credit allowance date of such bond which occurs during the
taxable year, there shall be allowed as a credit against the
tax imposed by this chapter for such taxable year an amount
equal to the sum of the credits determined under subsection
(b) with respect to credit allowance dates during such year
on which the taxpayer holds such bond.
``(b) Amount of Credit.--
``(1) In general.--The amount of the credit determined
under this subsection with respect to any credit allowance
date for a qualified public school modernization bond is 25
percent of the annual credit determined with respect to such
bond.
``(2) Annual credit.--The annual credit determined with
respect to any qualified public school modernization bond is
the product of--
``(A) the applicable credit rate, multiplied by
``(B) the outstanding face amount of the bond.
``(3) Applicable credit rate.--For purposes of paragraph
(1), the applicable credit rate with respect to an issue is
the rate equal to an average market yield (as of the day
before the date of issuance of the issue) on outstanding
long-term corporate debt obligations (determined under
regulations prescribed by the Secretary).
``(4) Special rule for issuance and redemption.--In the
case of a bond which is issued during the 3-month period
ending on a credit allowance date, the amount of the credit
determined under this subsection with respect to such credit
allowance date shall be a ratable portion of the credit
otherwise determined based on the portion of the 3-month
period during which the bond is outstanding. A similar rule
shall apply when the bond is redeemed.
``(c) Limitation Based on Amount of Tax.--
``(1) In general.--The credit allowed under subsection (a)
for any taxable year shall not exceed the excess of--
``(A) the sum of the regular tax liability (as defined in
section 26(b)) plus the tax imposed by section 55, over
``(B) the sum of the credits allowable under part IV of
subchapter A (other than subpart C thereof, relating to
refundable credits).
``(2) Carryover of unused credit.--If the credit allowable
under subsection (a) exceeds the limitation imposed by
paragraph (1) for such taxable year, such excess shall be
carried to the succeeding taxable year and added to the
credit allowable under subsection (a) for such taxable year.
``(d) Qualified Public School Modernization Bond; Credit
Allowance Date.--For purposes of this section--
``(1) Qualified public school modernization bond.--The term
`qualified public school modernization bond' means--
``(A) a qualified zone academy bond, and
``(B) a qualified school construction bond.
``(2) Credit allowance date.--The term `credit allowance
date' means--
``(A) March 15,
``(B) June 15,
``(C) September 15, and
``(D) December 15.
Such term includes the last day on which the bond is
outstanding.
``(e) Other Definitions.--For purposes of this subchapter--
``(1) Local educational agency.--The term `local
educational agency' has the meaning given to such term by
section 14101 of the Elementary and Secondary Education Act
of 1965. Such term includes the local educational agency that
serves the District of Columbia but does not include any
other State agency.
``(2) Bond.--The term `bond' includes any obligation.
``(3) State.--The term `State' includes the District of
Columbia and any possession of the United States.
``(4) Public school facility.--The term `public school
facility' shall not include--

[[Page H783]]

``(A) any stadium or other facility primarily used for
athletic contests or exhibitions or other events for which
admission is charged to the general public, or
``(B) any facility which is not owned by a State or local
government or any agency or instrumentality of a State or
local government.
``(f) Credit Included in Gross Income.--Gross income
includes the amount of the credit allowed to the taxpayer
under this section (determined without regard to subsection
(c)) and the amount so included shall be treated as interest
income.
``(g) Bonds Held by Regulated Investment Companies.--If any
qualified public school modernization bond is held by a
regulated investment company, the credit determined under
subsection (a) shall be allowed to shareholders of such
company under procedures prescribed by the Secretary.
``(h) Credits May Be Stripped.--Under regulations
prescribed by the Secretary--
``(1) In general.--There may be a separation (including at
issuance) of the ownership of a qualified public school
modernization bond and the entitlement to the credit under
this section with respect to such bond. In case of any such
separation, the credit under this section shall be allowed to
the person who on the credit allowance date holds the
instrument evidencing the entitlement to the credit and not
to the holder of the bond.
``(2) Certain rules to apply.--In the case of a separation
described in paragraph (1), the rules of section 1286 shall
apply to the qualified public school modernization bond as if
it were a stripped bond and to the credit under this section
as if it were a stripped coupon.
``(i) Treatment for Estimated Tax Purposes.--Solely for
purposes of sections 6654 and 6655, the credit allowed by
this section to a taxpayer by reason of holding a qualified
public school modernization bonds on a credit allowance date
shall be treated as if it were a payment of estimated tax
made by the taxpayer on such date.
``(j) Credit May Be Transferred.--Nothing in any law or
rule of law shall be construed to limit the transferability
of the credit allowed by this section through sale and
repurchase agreements.
``(k) Reporting.--Issuers of qualified public school
modernization bonds shall submit reports similar to the
reports required under section 149(e).
``(l) Penalty on Contractors Failing To Pay Prevailing
Wage.--
``(1) In general.--If any contractor on any project funded
by any qualified public school modernization bond has failed,
during any portion of such contractor's taxable year, to pay
prevailing wages that would be required under section 439 of
the General Education Provisions Act if such funding were an
applicable program under such section, the tax imposed by
chapter 1 on such contractor for such taxable year shall be
increased by 200 percent of the amount involved in such
failure.
``(2) Amount involved.--For purposes of paragraph (1), the
amount involved with respect to any failure is the excess of
the amount of wages such contractor would be so required to
pay under such section over the amount of wages paid.
``(3) Abatement of tax if failure corrected.--If a failure
to pay prevailing wages is corrected within a reasonable
period, then any tax imposed by paragraph (1) with respect to
such failure (including interest, additions to the tax, and
additional amounts) shall not be assessed, and if assessed
the assessment shall be abated, and if collected shall be
credited or refunded as an overpayment.
``(4) No credits against tax.--The tax imposed by paragraph
(1) shall not be treated as a tax imposed by this chapter for
purposes of determining--
``(A) the amount of any credit allowable under this
chapter, or
``(B) the amount of the minimum tax imposed by section 55.
``(m) Termination.--This section shall not apply to any
bond issued after December 31, 2004.

``PART II--QUALIFIED SCHOOL CONSTRUCTION BONDS

``Sec. 1400G. Qualified school construction bonds.

``SEC. 1400G. QUALIFIED SCHOOL CONSTRUCTION BONDS.

``(a) Qualified School Construction Bond.--For purposes of
this subchapter, the term `qualified school construction
bond' means any bond issued as part of an issue if--
``(1) 95 percent or more of the proceeds of such issue are
to be used for the construction, rehabilitation, or repair of
a public school facility or for the acquisition of land on
which such a facility is to be constructed with part of the
proceeds of such issue,
``(2) the bond is issued by a State or local government
within the jurisdiction of which such school is located,
``(3) the issuer designates such bond for purposes of this
section, and
``(4) the term of each bond which is part of such issue
does not exceed 15 years.
``(b) Limitation on Amount of Bonds Designated.--The
maximum aggregate face amount of bonds issued during any
calendar year which may be designated under subsection (a) by
any issuer shall not exceed the sum of--
``(1) the limitation amount allocated under subsection (d)
for such calendar year to such issuer, and
``(2) if such issuer is a large local educational agency
(as defined in subsection (e)(4)) or is issuing on behalf of
such an agency, the limitation amount allocated under
subsection (e) for such calendar year to such agency.
``(c) National Limitation on Amount of Bonds Designated.--
There is a national qualified school construction bond
limitation for each calendar year. Such limitation is--
``(1) $11,000,000,000 for 2001,
``(2) except as provided in subsection (f), zero after
2001.
``(d) Half of Limitation Allocated Among States.--
``(1) In general.--One-half of the limitation applicable
under subsection (c) for any calendar year shall be allocated
among the States under paragraph (2) by the Secretary. The
limitation amount allocated to a State under the preceding
sentence shall be allocated by the State to issuers within
such State and such allocations may be made only if there is
an approved State application.
``(2) Allocation formula.--The amount to be allocated under
paragraph (1) for any calendar year shall be allocated among
the States in proportion to the respective amounts each such
State received for Basic Grants under subpart 2 of part A of
title I of the Elementary and Secondary Education Act of 1965
(20 U.S.C. 6331 et seq.) for the most recent fiscal year
ending before such calendar year. For purposes of the
preceding sentence, Basic Grants attributable to large local
educational agencies (as defined in subsection (e)) shall be
disregarded.
``(3) Minimum allocations to states.--
``(A) In general.--The Secretary shall adjust the
allocations under this subsection for any calendar year for
each State to the extent necessary to ensure that the sum
of--
``(i) the amount allocated to such State under this
subsection for such year, and
``(ii) the aggregate amounts allocated under subsection (e)
to large local educational agencies in such State for such
year,

is not less than an amount equal to such State's minimum
percentage of the amount to be allocated under paragraph (1)
for the calendar year.
``(B) Minimum percentage.--A State's minimum percentage for
any calendar year is the minimum percentage described in
section 1124(d) of the Elementary and Secondary Education Act
of 1965 (20 U.S.C. 6334(d)) for such State for the most
recent fiscal year ending before such calendar year.
``(4) Allocations to certain possessions.--The amount to be
allocated under paragraph (1) to any possession of the United
States other than Puerto Rico shall be the amount which would
have been allocated if all allocations under paragraph (1)
were made on the basis of respective populations of
individuals below the poverty line (as defined by the Office
of Management and Budget). In making other allocations, the
amount to be allocated under paragraph (1) shall be reduced
by the aggregate amount allocated under this paragraph to
possessions of the United States.
``(5) Allocations for indian schools.--In addition to the
amounts otherwise allocated under this subsection,
$200,000,000 for calendar year 2001 shall be allocated by the
Secretary of the Interior for purposes of the construction,
rehabilitation, and repair of schools funded by the Bureau of
Indian Affairs. In the case of amounts allocated under the
preceding sentence, Indian tribal governments (as defined in
section 7871) shall be treated as qualified issuers for
purposes of this subchapter.
``(6) Approved state application.--For purposes of
paragraph (1), the term `approved State application' means an
application which is approved by the Secretary of Education
and which includes--
``(A) the results of a recent publicly-available survey
(undertaken by the State with the involvement of local
education officials, members of the public, and experts in
school construction and management) of such State's needs for
public school facilities, including descriptions of--
``(i) health and safety problems at such facilities,
``(ii) the capacity of public schools in the State to house
projected enrollments, and
``(iii) the extent to which the public schools in the State
offer the physical infrastructure needed to provide a high-
quality education to all students, and
``(B) a description of how the State will allocate to local
educational agencies, or otherwise use, its allocation under
this subsection to address the needs identified under
subparagraph (A), including a description of how it will--
``(i) give highest priority to localities with the greatest
needs, as demonstrated by inadequate school facilities
coupled with a low level of resources to meet those needs,
``(ii) use its allocation under this subsection to assist
localities that lack the fiscal capacity to issue bonds on
their own, and
``(iii) ensure that its allocation under this subsection is
used only to supplement, and not supplant, the amount of
school construction, rehabilitation, and repair in the State
that would have occurred in the absence of such allocation.

Any allocation under paragraph (1) by a State shall be
binding if such State reasonably determined that the
allocation was in accordance with the plan approved under
this paragraph.
``(e) Half of Limitation Allocated Among Largest School
Districts.--

[[Page H784]]

``(1) In general.--One-half of the limitation applicable
under subsection (c) for any calendar year shall be allocated
under paragraph (2) by the Secretary among local educational
agencies which are large local educational agencies for such
year. No qualified school construction bond may be issued by
reason of an allocation to a large local educational agency
under the preceding sentence unless such agency has an
approved local application.
``(2) Allocation formula.--The amount to be allocated under
paragraph (1) for any calendar year shall be allocated among
large local educational agencies in proportion to the
respective amounts each such agency received for Basic Grants
under subpart 2 of part A of title I of the Elementary and
Secondary Education Act of 1965 (20 U.S.C. 6331 et seq.) for
the most recent fiscal year ending before such calendar year.
``(3) Allocation of unused limitation to state.--The amount
allocated under this subsection to a large local educational
agency for any calendar year may be reallocated by such
agency to the State in which such agency is located for such
calendar year. Any amount reallocated to a State under the
preceding sentence may be allocated as provided in subsection
(d)(1).
``(4) Large local educational agency.--For purposes of this
section, the term `large local educational agency' means,
with respect to a calendar year, any local educational agency
if such agency is--
``(A) among the 100 local educational agencies with the
largest numbers of children aged 5 through 17 from families
living below the poverty level, as determined by the
Secretary using the most recent data available from the
Department of Commerce that are satisfactory to the
Secretary, or
``(B) 1 of not more than 25 local educational agencies
(other than those described in subparagraph (A)) that the
Secretary of Education determines (based on the most recent
data available satisfactory to the Secretary) are in
particular need of assistance, based on a low level of
resources for school construction, a high level of enrollment
growth, or such other factors as the Secretary deems
appropriate.
``(5) Approved local application.--For purposes of
paragraph (1), the term `approved local application' means an
application which is approved by the Secretary of Education
and which includes--
``(A) the results of a recent publicly-available survey
(undertaken by the local educational agency or the State with
the involvement of school officials, members of the public,
and experts in school construction and management) of such
agency's needs for public school facilities, including
descriptions of--
``(i) the overall condition of the local educational
agency's school facilities, including health and safety
problems,
``(ii) the capacity of the agency's schools to house
projected enrollments, and
``(iii) the extent to which the agency's schools offer the
physical infrastructure needed to provide a high-quality
education to all students,
``(B) a description of how the local educational agency
will use its allocation under this subsection to address the
needs identified under subparagraph (A), and
``(C) a description of how the local educational agency
will ensure that its allocation under this subsection is used
only to supplement, and not supplant, the amount of school
construction, rehabilitation, or repair in the locality that
would have occurred in the absence of such allocation.
A rule similar to the rule of the last sentence of subsection
(d)(6) shall apply for purposes of this paragraph.
``(f) Carryover of Unused Limitation.--If for any calendar
year--
``(1) the amount allocated under subsection (d) to any
State, exceeds
``(2) the amount of bonds issued during such year which are
designated under subsection (a) pursuant to such allocation,
the limitation amount under such subsection for such State
for the following calendar year shall be increased by the
amount of such excess. A similar rule shall apply to the
amounts allocated under subsection (d)(5) or (e).
``(g) Special Rules Relating to Arbitrage.--
``(1) In general.--A bond shall not be treated as failing
to meet the requirement of subsection (a)(1) solely by reason
of the fact that the proceeds of the issue of which such bond
is a part are invested for a temporary period (but not more
than 36 months) until such proceeds are needed for the
purpose for which such issue was issued.
``(2) Binding commitment requirement.--Paragraph (1) shall
apply to an issue only if, as of the date of issuance, there
is a reasonable expectation that--
``(A) at least 10 percent of the proceeds of the issue will
be spent within the 6-month period beginning on such date for
the purpose for which such issue was issued, and
``(B) the remaining proceeds of the issue will be spent
with due diligence for such purpose.
``(3) Earnings on proceeds.--Any earnings on proceeds
during the temporary period shall be treated as proceeds of
the issue for purposes of applying subsection (a)(1) and
paragraph (1) of this subsection.

``PART III--INCENTIVES FOR EDUCATION ZONES

``Sec. 1400H. Qualified zone academy bonds.

``SEC. 1400H. QUALIFIED ZONE ACADEMY BONDS.

``(a) Qualified Zone Academy Bond.--For purposes of this
subchapter--
``(1) In general.--The term `qualified zone academy bond'
means any bond issued as part of an issue if--
``(A) 95 percent or more of the proceeds of such issue are
to be used for a qualified purpose with respect to a
qualified zone academy established by a local educational
agency,
``(B) the bond is issued by a State or local government
within the jurisdiction of which such academy is located,
``(C) the issuer--
``(i) designates such bond for purposes of this section,
``(ii) certifies that it has written assurances that the
private business contribution requirement of paragraph (2)
will be met with respect to such academy, and
``(iii) certifies that it has the written approval of the
local educational agency for such bond issuance, and
``(D) the term of each bond which is part of such issue
does not exceed 15 years.
Rules similar to the rules of section 1400G(g) shall apply
for purposes of paragraph (1).
``(2) Private business contribution requirement.--
``(A) In general.--For purposes of paragraph (1), the
private business contribution requirement of this paragraph
is met with respect to any issue if the local educational
agency that established the qualified zone academy has
written commitments from private entities to make qualified
contributions having a present value (as of the date of
issuance of the issue) of not less than 10 percent of the
proceeds of the issue.
``(B) Qualified contributions.--For purposes of
subparagraph (A), the term `qualified contribution' means any
contribution (of a type and quality acceptable to the local
educational agency) of--
``(i) equipment for use in the qualified zone academy
(including state-of-the-art technology and vocational
equipment),
``(ii) technical assistance in developing curriculum or in
training teachers in order to promote appropriate market
driven technology in the classroom,
``(iii) services of employees as volunteer mentors,
``(iv) internships, field trips, or other educational
opportunities outside the academy for students, or
``(v) any other property or service specified by the local
educational agency.
``(3) Qualified zone academy.--The term `qualified zone
academy' means any public school (or academic program within
a public school) which is established by and operated under
the supervision of a local educational agency to provide
education or training below the postsecondary level if--
``(A) such public school or program (as the case may be) is
designed in cooperation with business to enhance the academic
curriculum, increase graduation and employment rates, and
better prepare students for the rigors of college and the
increasingly complex workforce,
``(B) students in such public school or program (as the
case may be) will be subject to the same academic standards
and assessments as other students educated by the local
educational agency,
``(C) the comprehensive education plan of such public
school or program is approved by the local educational
agency, and
``(D)(i) such public school is located in an empowerment
zone or enterprise community (including any such zone or
community designated after the date of the enactment of this
section), or
``(ii) there is a reasonable expectation (as of the date of
issuance of the bonds) that at least 35 percent of the
students attending such school or participating in such
program (as the case may be) will be eligible for free or
reduced-cost lunches under the school lunch program
established under the National School Lunch Act.
``(4) Qualified purpose.--The term `qualified purpose'
means, with respect to any qualified zone academy--
``(A) constructing, rehabilitating, or repairing the public
school facility in which the academy is established,
``(B) acquiring the land on which such facility is to be
constructed with part of the proceeds of such issue,
``(C) providing equipment for use at such academy,
``(D) developing course materials for education to be
provided at such academy, and
``(E) training teachers and other school personnel in such
academy.
``(b) Limitations on Amount of Bonds Designated.--
``(1) In general.--There is a national zone academy bond
limitation for each calendar year. Such limitation is--
``(A) $400,000,000 for 1998,
``(B) $400,000,000 for 1999,
``(C) $400,000,000 for 2000,
``(D) $1,400,000,000 for 2001,
``(E) except as provided in paragraph (3), zero after 2001.
``(2) Allocation of limitation.--
``(A) Allocation among states.--
``(i) 1998, 1999, and 2000 limitations.--The national zone
academy bond limitations for calendar years 1998, 1999, and
2000 shall be allocated by the Secretary among the States on
the basis of their respective populations of individuals
below the poverty line (as defined by the Office of
Management and Budget).
``(ii) Limitation after 2000.--The national zone academy
bond limitation for any calendar year after 2000 shall be
allocated by

[[Page H785]]

the Secretary among the States in the manner prescribed by
section 1400G(d); except that in making the allocation under
this clause, the Secretary shall take into account--

``(I) Basic Grants attributable to large local educational
agencies (as defined in section 1400G(e)).
``(II) the national zone academy bond limitation.

``(B) Allocation to local educational agencies.--The
limitation amount allocated to a State under subparagraph (A)
shall be allocated by the State education agency to qualified
zone academies within such State.
``(C) Designation subject to limitation amount.--The
maximum aggregate face amount of bonds issued during any
calendar year which may be designated under subsection (a)
with respect to any qualified zone academy shall not exceed
the limitation amount allocated to such academy under
subparagraph (B) for such calendar year.
``(3) Carryover of unused limitation.--If for any calendar
year--
``(A) the limitation amount under this subsection for any
State, exceeds
``(B) the amount of bonds issued during such year which are
designated under subsection (a) (or the corresponding
provisions of prior law) with respect to qualified zone
academies within such State,
the limitation amount under this subsection for such State
for the following calendar year shall be increased by the
amount of such excess.''.
(b) Reporting.--Subsection (d) of section 6049 of such Code
(relating to returns regarding payments of interest) is
amended by adding at the end the following new paragraph:
``(8) Reporting of credit on qualified public school
modernization bonds.--
``(A) In general.--For purposes of subsection (a), the term
`interest' includes amounts includible in gross income under
section 1400F(f) and such amounts shall be treated as paid on
the credit allowance date (as defined in section
1400F(d)(2)).
``(B) Reporting to corporations, etc.--Except as otherwise
provided in regulations, in the case of any interest
described in subparagraph (A) of this paragraph, subsection
(b)(4) of this section shall be applied without regard to
subparagraphs (A), (H), (I), (J), (K), and (L)(i).
``(C) Regulatory authority.--The Secretary may prescribe
such regulations as are necessary or appropriate to carry out
the purposes of this paragraph, including regulations which
require more frequent or more detailed reporting.''
(c) Other Conforming Amendments.--
(1) Subchapter U of chapter 1 of such Code is amended by
striking part IV, by redesignating part V as part IV, and by
redesignating section 1397F as section 1397E.
(2) The table of subchapters for chapter 1 of such Code is
amended by adding at the end the following new item:

``Subchapter X. Public school modernization provisions.''
(3) The table of parts of subchapter U of chapter 1 of such
Code is amended by striking the last 2 items and inserting
the following item:

``Part IV. Regulations.''
(d) Effective Dates.--
(1) In general.--Except as otherwise provided in this
subsection, the amendments made by this section shall apply
to obligations issued after December 31, 2000.
(2) Repeal of restriction on zone academy bond holders.--In
the case of bonds to which section 1397E of the Internal
Revenue Code of 1986 (as in effect before the date of the
enactment of this Act) applies, the limitation of such
section to eligible taxpayers (as defined in subsection
(d)(6) of such section) shall not apply after the date of the
enactment of this Act.
Subtitle F--Increased Estate Tax Relief for Family-Owned Business
Interests

SEC. 251. INCREASE IN ESTATE TAX BENEFIT FOR FAMILY-OWNED
BUSINESS INTERESTS.

(a) Transfer to Credit Provisions.--Section 2057 of the
Internal Revenue Code of 1986 (relating to family-owned
business interests) is hereby moved to part II of subchapter
A of chapter 11 of such Code, inserted after section 2010,
and redesignated as section 2010A.
(b) Increase in Credit; Surviving Spouse Allowed Unused
Credit of Decedent.--Subsection (a) of section 2010A of such
Code, as redesignated by subsection (a) of this section, is
amended to read as follows:
``(a) Increase in United Credit.--For purposes of
determining the unified credit under section 2010 in the case
of an estate of a decedent to which this section applies--
``(1) In general.--The applicable exclusion amount under
section 2010(c) shall be increased (but not in excess of
$2,000,000) by the adjusted value of the qualified family-
owned business interests of the decedent which are described
in subsection (b)(2) and for which no deduction is allowed
under section 2056.
``(2) Treatment of unused limitation of predeceased
spouse.--In the case of a decedent--
``(A) having no surviving spouse, but
``(B) who was the surviving spouse of a decedent--
``(i) who died after December 31, 2000, and
``(ii) whose estate met the requirements of subsection
(b)(1) other than subparagraph (B) thereof,
there shall be substituted for `$2,000,000' in paragraph (1)
an amount equal to the excess of $4,000,000 over the
exclusion equivalent of the credit allowed under section 2010
(as increased by this section) to the estate of the decedent
referred to in subparagraph (B). For purposes of the
preceding sentence, the exclusion equivalent of the credit is
the amount on which a tentative tax under section 2001(c)
equal to such credit would be imposed.''
(c) Conforming Amendments.--
(1) The table of sections for part IV of subchapter A of
chapter 11 of such Code is amended by striking the item
relating to section 2057.
(2) Paragraph (10) of section 2031(c) of such Code is
amended by striking ``section 2057(e)(3)'' and inserting
``section 2010A(e)(3)''.
(3) The table of sections for part II of subchapter A of
chapter 11 of such Code is amended by inserting after the
item relating to section 2010 the following new item:

``Sec. 2010A. Family-owned business interests.''
(d) Effective date.--The amendments made by this section
shall apply to estates of decedents dying after December 31,
2000.

Subtitle G--Revenue Offsets

PART I--REVISION OF TAX RULES ON EXPATRIATION

SEC. 261. REVISION OF TAX RULES ON EXPATRIATION.

(a) In General.--Subpart A of part II of subchapter N of
chapter 1 of the Internal Revenue Code of 1986 is amended by
inserting after section 877 the following new section:

``SEC. 877A. TAX RESPONSIBILITIES OF EXPATRIATION.

``(a) General Rules.--For purposes of this subtitle--
``(1) Mark to market.--Except as provided in subsection
(f), all property of a covered expatriate to whom this
section applies shall be treated as sold on the day before
the expatriation date for its fair market value.
``(2) Recognition of gain or loss.--In the case of any sale
under paragraph (1)--
``(A) notwithstanding any other provision of this title,
any gain arising from such sale shall be taken into account
for the taxable year of the sale, and
``(B) any loss arising from such sale shall be taken into
account for the taxable year of the sale to the extent
otherwise provided by this title, except that section 1091
shall not apply to any such loss.
Proper adjustment shall be made in the amount of any gain or
loss subsequently realized for gain or loss taken into
account under the preceding sentence.
``(3) Exclusion for certain gain.--The amount which would
(but for this paragraph) be includible in the gross income of
any individual by reason of this section shall be reduced
(but not below zero) by $600,000. For purposes of this
paragraph, allocable expatriation gain taken into account
under subsection (f)(2) shall be treated in the same manner
as an amount required to be includible in gross income.
``(b) Election To Defer Tax.--
``(1) In general.--If the taxpayer elects the application
of this subsection with respect to any property treated as
sold by reason of subsection (a), the payment of the
additional tax attributable to such property shall be
postponed until the due date of the return for the taxable
year in which such property is disposed of (or, in the case
of property disposed of in a transaction in which gain is not
recognized in whole or in part, until such other date as the
Secretary may prescribe).
``(2) Determination of tax with respect to property.--For
purposes of paragraph (1), the additional tax attributable to
any property is an amount which bears the same ratio to the
additional tax imposed by this chapter for the taxable year
solely by reason of subsection (a) as the gain taken into
account under subsection (a) with respect to such property
bears to the total gain taken into account under subsection
(a) with respect to all property to which subsection (a)
applies.
``(3) Termination of postponement.--No tax may be postponed
under this subsection later than the due date for the return
of tax imposed by this chapter for the taxable year which
includes the date of death of the expatriate (or, if earlier,
the time that the security provided with respect to the
property fails to meet the requirements of paragraph (4),
unless the taxpayer corrects such failure within the time
specified by the Secretary).
``(4) Security.--
``(A) In general.--No election may be made under paragraph
(1) with respect to any property unless adequate security is
provided with respect to such property.
``(B) Adequate security.--For purposes of subparagraph (A),
security with respect to any property shall be treated as
adequate security if--
``(i) it is a bond in an amount equal to the deferred tax
amount under paragraph (2)(A) for the property, or
``(ii) the taxpayer otherwise establishes to the
satisfaction of the Secretary that the security is adequate.
``(5) Waiver of certain rights.--No election may be made
under paragraph (1) unless the taxpayer consents to the
waiver of any right under any treaty of the United States
which would preclude assessment or collection of any tax
imposed by reason of this section.
``(6) Elections.--An election under paragraph (1) shall
only apply to property described in the election and, once
made, is irrevocable. An election may be under paragraph (1)
with respect to an interest in a

[[Page H786]]

trust with respect to which gain is required to be recognized
under subsection (f)(1).
``(7) Interest.--For purposes of section 6601, the last
date for the payment of tax shall be determined without
regard to the election under this subsection.
``(c) Covered Expatriate.--For purposes of this section--
``(1) In general.--The term `covered expatriate' means an
expatriate who meets the requirements of subparagraph (A) or
(B) of section 877(a)(2).
``(2) Exceptions.--An individual shall not be treated as a
covered expatriate if--
``(A) the individual--
``(i) became at birth a citizen of the United States and a
citizen of another country and, as of the expatriation date,
continues to be a citizen of, and is taxed as a resident of,
such other country, and
``(ii) has been a resident of the United States (as defined
in section 7701(b)(1)(A)(ii)) for not more than 8 taxable
years during the 15-taxable year period ending with the
taxable year during which the expatriation date occurs, or
``(B)(i) the individual's relinquishment of United States
citizenship occurs before such individual attains age 18\1/
2\, and
``(ii) the individual has been a resident of the United
States (as so defined) for not more than 5 taxable years
before the date of relinquishment.
``(d) Section Not To Apply to Certain Property.--This
section shall not apply to the following property:
``(1) United states real property interests.--Any United
States real property interest (as defined in section
897(c)(1)), other than stock of a United States real property
holding corporation which does not, on the day before the
expatriation date, meet the requirements of section
897(c)(2).
``(2) Interest in certain retirement plans.--
``(A) In general.--Any interest in a qualified retirement
plan (as defined in section 4974(c)), other than any interest
attributable to contributions which are in excess of any
limitation or which violate any condition for tax-favored
treatment.
``(B) Foreign pension plans.--
``(i) In general.--Under regulations prescribed by the
Secretary, interests in foreign pension plans or similar
retirement arrangements or programs.
``(ii) Limitation.--The value of property which is treated
as not sold by reason of this subparagraph shall not exceed
$500,000.
``(e) Definitions.--For purposes of this section--
``(1) Expatriate.--The term `expatriate' means--
``(A) any United States citizen who relinquishes his
citizenship, and
``(B) any long-term resident of the United States who--
``(i) ceases to be a lawful permanent resident of the
United States (within the meaning of section 7701(b)(6)), or
``(ii) commences to be treated as a resident of a foreign
country under the provisions of a tax treaty between the
United States and the foreign country and who does not waive
the benefits of such treaty applicable to residents of the
foreign country.
``(2) Expatriation date.--The term `expatriation date'
means--
``(A) the date an individual relinquishes United States
citizenship, or
``(B) in the case of a long-term resident of the United
States, the date of the event described in clause (i) or (ii)
of paragraph (1)(B).
``(3) Relinquishment of citizenship.--A citizen shall be
treated as relinquishing his United States citizenship on the
earliest of--
``(A) the date the individual renounces his United States
nationality before a diplomatic or consular officer of the
United States pursuant to paragraph (5) of section 349(a) of
the Immigration and Nationality Act (8 U.S.C. 1481(a)(5)),
``(B) the date the individual furnishes to the United
States Department of State a signed statement of voluntary
relinquishment of United States nationality confirming the
performance of an act of expatriation specified in paragraph
(1), (2), (3), or (4) of section 349(a) of the Immigration
and Nationality Act (8 U.S.C. 1481(a)(1)-(4)),
``(C) the date the United States Department of State issues
to the individual a certificate of loss of nationality, or
``(D) the date a court of the United States cancels a
naturalized citizen's certificate of naturalization.
Subparagraph (A) or (B) shall not apply to any individual
unless the renunciation or voluntary relinquishment is
subsequently approved by the issuance to the individual of a
certificate of loss of nationality by the United States
Department of State.
``(4) Long-term resident.--The term `long-term resident'
has the meaning given to such term by section 877(e)(2).
``(f) Special Rules Applicable to Beneficiaries' Interests
in Trust.--
``(1) In general.--Except as provided in paragraph (2), if
an individual is determined under paragraph (3) to hold an
interest in a trust on the day before the expatriation date--
``(A) the individual shall not be treated as having sold
such interest,
``(B) such interest shall be treated as a separate share in
the trust, and
``(C)(i) such separate share shall be treated as a separate
trust consisting of the assets allocable to such share,
``(ii) the separate trust shall be treated as having sold
its assets on the day before the expatriation date for their
fair market value and as having distributed all of its assets
to the individual as of such time, and
``(iii) the individual shall be treated as having
recontributed the assets to the separate trust.
Subsection (a)(2) shall apply to any income, gain, or loss of
the individual arising from a distribution described in
subparagraph (C)(ii).
``(2) Special rules for interests in qualified trusts.--
``(A) In general.--If the trust interest described in
paragraph (1) is an interest in a qualified trust--
``(i) paragraph (1) and subsection (a) shall not apply, and
``(ii) in addition to any other tax imposed by this title,
there is hereby imposed on each distribution with respect to
such interest a tax in the amount determined under
subparagraph (B).
``(B) Amount of tax.--The amount of tax under subparagraph
(A)(ii) shall be equal to the lesser of--
``(i) the highest rate of tax imposed by section 1(e) for
the taxable year which includes the day before the
expatriation date, multiplied by the amount of the
distribution, or
``(ii) the balance in the deferred tax account immediately
before the distribution determined without regard to any
increases under subparagraph (C)(ii) after the 30th day
preceding the distribution.
``(C) Deferred tax account.--For purposes of subparagraph
(B)(ii)--
``(i) Opening balance.--The opening balance in a deferred
tax account with respect to any trust interest is an amount
equal to the tax which would have been imposed on the
allocable expatriation gain with respect to the trust
interest if such gain had been included in gross income under
subsection (a).
``(ii) Increase for interest.--The balance in the deferred
tax account shall be increased by the amount of interest
determined (on the balance in the account at the time the
interest accrues), for periods after the 90th day after the
expatriation date, by using the rates and method applicable
under section 6621 for underpayments of tax for such periods.
``(iii) Decrease for taxes previously paid.--The balance in
the tax deferred account shall be reduced--

``(I) by the amount of taxes imposed by subparagraph (A) on
any distribution to the person holding the trust interest,
and
``(II) in the case of a person holding a nonvested
interest, to the extent provided in regulations, by the
amount of taxes imposed by subparagraph (A) on distributions
from the trust with respect to nonvested interests not held
by such person.

``(D) Allocable expatriation gain.--For purposes of this
paragraph, the allocable expatriation gain with respect to
any beneficiary's interest in a trust is the amount of gain
which would be allocable to such beneficiary's vested and
nonvested interests in the trust if the beneficiary held
directly all assets allocable to such interests.
``(E) Tax deducted and withheld.--
``(i) In general.--The tax imposed by subparagraph (A)(ii)
shall be deducted and withheld by the trustees from the
distribution to which it relates.
``(ii) Exception where failure to waive treaty rights.--If
an amount may not be deducted and withheld under clause (i)
by reason of the distributee failing to waive any treaty
right with respect to such distribution--

``(I) the tax imposed by subparagraph (A)(ii) shall be
imposed on the trust and each trustee shall be personally
liable for the amount of such tax, and
``(II) any other beneficiary of the trust shall be entitled
to recover from the distributee the amount of such tax
imposed on the other beneficiary.

``(F) Disposition.--If a trust ceases to be a qualified
trust at any time, a covered expatriate disposes of an
interest in a qualified trust, or a covered expatriate
holding an interest in a qualified trust dies, then, in lieu
of the tax imposed by subparagraph (A)(ii), there is hereby
imposed a tax equal to the lesser of--
``(i) the tax determined under paragraph (1) as if the day
before the expatriation date were the date of such cessation,
disposition, or death, whichever is applicable, or
``(ii) the balance in the tax deferred account immediately
before such date.
Such tax shall be imposed on the trust and each trustee shall
be personally liable for the amount of such tax and any other
beneficiary of the trust shall be entitled to recover from
the covered expatriate or the estate the amount of such tax
imposed on the other beneficiary.
``(G) Definitions and special rule.--For purposes of this
paragraph--
``(i) Qualified trust.--The term `qualified trust' means a
trust--

``(I) which is organized under, and governed by, the laws
of the United States or a State, and
``(II) with respect to which the trust instrument requires
that at least 1 trustee of the trust be an individual citizen
of the United States or a domestic corporation.

``(ii) Vested interest.--The term `vested interest' means
any interest which, as of the day before the expatriation
date, is vested in the beneficiary.
``(iii) Nonvested interest.--The term `nonvested interest'
means, with respect to any beneficiary, any interest in a
trust which is not a vested interest. Such interest

[[Page H787]]

shall be determined by assuming the maximum exercise of
discretion in favor of the beneficiary and the occurrence of
all contingencies in favor of the beneficiary.
``(iv) Adjustments.--The Secretary may provide for such
adjustments to the bases of assets in a trust or a deferred
tax account, and the timing of such adjustments, in order to
ensure that gain is taxed only once.
``(3) Determination of beneficiaries' interest in trust.--
``(A) Determinations under paragraph (1).--For purposes of
paragraph (1), a beneficiary's interest in a trust shall be
based upon all relevant facts and circumstances, including
the terms of the trust instrument and any letter of wishes or
similar document, historical patterns of trust distributions,
and the existence of and functions performed by a trust
protector or any similar advisor.
``(B) Other determinations.--For purposes of this section--
``(i) Constructive ownership.--If a beneficiary of a trust
is a corporation, partnership, trust, or estate, the
shareholders, partners, or beneficiaries shall be deemed to
be the trust beneficiaries for purposes of this section.
``(ii) Taxpayer return position.--A taxpayer shall clearly
indicate on its income tax return--

``(I) the methodology used to determine that taxpayer's
trust interest under this section, and
``(II) if the taxpayer knows (or has reason to know) that
any other beneficiary of such trust is using a different
methodology to determine such beneficiary's trust interest
under this section.

``(g) Termination of Deferrals, Etc.--In the case of any
covered expatriate, notwithstanding any other provision of
this title--
``(1) any period during which recognition of income or gain
is deferred shall terminate on the day before the
expatriation date, and
``(2) any extension of time for payment of tax shall cease
to apply on the day before the expatriation date and the
unpaid portion of such tax shall be due and payable at the
time and in the manner prescribed by the Secretary.
``(h) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out
the purposes of this section.''
(b) Tax on Gifts and Bequests Received By United States
Citizens and Residents From Expatriates.--
(1) In general.--Subtitle B of the Internal Revenue Code of
1986 (relating to estate and gift taxes) is amended by
inserting after chapter 13 the following new chapter:

``CHAPTER 13A--GIFTS AND BEQUESTS FROM EXPATRIATES

``Sec. 2681. Imposition of tax.

``SEC. 2681. IMPOSITION OF TAX.

``(a) In General.--If, during any calendar year, any United
States citizen or resident receives any covered gift or
bequest, there is hereby imposed a tax equal to the product
of--
``(1) the highest rate of tax specified in the table
contained in section 2001(c) as in effect on the date of such
receipt, and
``(2) the value of such covered gift or bequest.
``(b) Tax To Be Paid by Recipient.--The tax imposed by
subsection (a) on any covered gift or bequest shall be paid
by the person receiving such gift or bequest.
``(c) Exception for Certain Gifts.--Subsection (a) shall
apply only to the extent that the covered gifts and bequests
received during the calendar year exceed $10,000.
``(d) Tax Reduced By Foreign Gift or Estate Tax.--The tax
imposed by subsection (a) on any covered gift or bequest
shall be reduced by the amount of any gift or estate tax paid
to a foreign country with respect to such covered gift or
bequest.
``(e) Covered Gift or Bequest.--
``(1) In general.--For purposes of this chapter, the term
`covered gift or bequest' means--
``(A) any property acquired by gift directly or indirectly
from an individual who, at the time of such acquisition, was
an expatriate, and
``(B) any property acquired by bequest, devise, or
inheritance directly or indirectly from an individual who, at
the time of death, was an expatriate.
``(2) Exceptions for transfers otherwise subject to estate
or gift tax.--Such term shall not include--
``(A) any property shown on a timely filed return of tax
imposed by chapter 12 which is a taxable gift by the
expatriate, and
``(B) any property shown on a timely filed return of tax
imposed by chapter 11 of the estate of the expatriate.
``(3) Transfers in trust.--Any covered gift or bequest
which is made in trust shall be treated as made to the
beneficiaries of such trust in proportion to their respective
interests in such trust (as determined under section
877A(f)(3)).
``(f) Expatriate.--For purposes of this section, the term
`expatriate' has the meaning given to such term by section
877A(e)(1).''.
(2) Clerical amendment.--The table of chapters for subtitle
B of such Code is amended by inserting after the item
relating to chapter 13 the following new item:

``Chapter 13A. Gifts and bequests from expatriates.''
(c) Definition of Termination of United States
Citizenship.--Section 7701(a) of such Code is amended by
adding at the end the following new paragraph:
``(47) Termination of united states citizenship.--
``(A) In general.--An individual shall not cease to be
treated as a United States citizen before the date on which
the individual's citizenship is treated as relinquished under
section 877A(e)(3).
``(B) Dual citizens.--Under regulations prescribed by the
Secretary, subparagraph (A) shall not apply to an individual
who became at birth a citizen of the United States and a
citizen of another country.''
(d) Conforming Amendment.--Paragraph (1) of section
6039G(d) of such Code is amended by inserting ``or 877A''
after ``section 877''.
(e) Clerical Amendment.--The table of sections for subpart
A of part II of subchapter N of chapter 1 of such Code is
amended by inserting after the item relating to section 877
the following new item:

``Sec. 877A. Tax responsibilities of expatriation.''.
(f) Effective Date.--
(1) In general.--Except as provided in this subsection, the
amendments made by this section shall apply to expatriates
(within the meaning of section 877A(e) of the Internal
Revenue Code of 1986, as added by this section) whose
expatriation date (as so defined) occurs on or after March 9,
2000.
(2) Gifts and bequests.--Chapter 13A of the Internal
Revenue Code of 1986 (as added by subsection (b)) shall apply
to covered gifts and bequests (as defined in section 2681 of
such Code, as so added) received on or after March 9, 2000.

PART II--DISALLOWANCE OF NONECONOMIC TAX ATTRIBUTES

Subpart A--Disallowance of Noneconomic Tax Attributes; Increase in
Penalty With Respect to Disallowed Noneconomic Tax Attributes

SEC. 266. DISALLOWANCE OF NONECONOMIC TAX ATTRIBUTES.

Section 7701 of the Internal Revenue Code of 1986 is
amended by redesignating subsection (m) as subsection (n) and
by inserting after subsection (l) the following new
subsection:
``(m) Disallowance of Noneconomic Tax Attributes.--
``(1) In general.--In determining liability for any tax
under subtitle A, noneconomic tax attributes shall not be
allowed.
``(2) Noneconomic tax attribute.--For purposes of this
subsection, a noneconomic tax attribute is any deduction,
loss, or credit claimed to result from any transaction
unless--
``(A) the transaction changes in a meaningful way (apart
from Federal income tax consequences) the taxpayer's economic
position, and
``(B)(i) the present value of the reasonably expected
potential income from the transaction (and the taxpayer's
risk of loss from the transaction) are substantial in
relationship to the present value of the tax benefits
claimed, or
``(ii) in the case of a transaction which is in substance
the borrowing of money or the acquisition of financial
capital, the deductions claimed with respect to the
transaction for any period are not significantly in excess of
the economic return for such period realized by the person
lending the money or providing the financial capital.
``(3) Presumption of noneconomic tax attributes.--For
purposes of paragraph (2), the following factors shall give
rise to a presumption that a transaction fails to meet the
requirements of paragraph (2):
``(A) The fact that the payments, liabilities, or assets
that purport to create a loss (or other benefit) for tax
purposes are not reflected to any meaningful extent on the
taxpayer's books and records for financial reporting
purposes.
``(B) The fact that the transaction results in an
allocation of income or gain to a tax-indifferent party which
is substantially in excess of such party's economic income or
gain from the transaction.
``(4) Treatment of built-in loss.--The determination of
whether a transaction results in the realization of a built-
in loss shall be made under subtitle A as if this subsection
had not been enacted. For purposes of the preceding sentence,
the term `built-in loss' means any loss or deduction to the
extent that such loss or deduction had economically been
incurred before such transaction is entered into and to the
extent that the loss or deduction was economically borne by
the taxpayer.
``(5) Definition and special rules.--For purposes of this
subsection--
``(A) Tax-indifferent party.--The term `tax-indifferent
party' means any person or entity exempt from tax under
subtitle A. A person shall be treated as a tax-indifferent
party with respect to a transaction if, by reason of such
person's method of accounting, the items taken into account
with respect to the transaction have no substantial impact on
such person's liability under subtitle A.
``(B) Series of related transaction.--A transaction which
is part of a series of related transactions shall be treated
as meeting the requirements of paragraph (2) only if--

[[Page H788]]

``(i) such transaction meets such requirements without
regard to the other transactions, and
``(ii) such transactions, if treated as 1 transaction,
would meet such requirements.
A similar rule shall apply to a multiple step transaction
with each step being treated as a separate related
transaction.
``(C) Normal business transactions.--In the case of a
transaction which is an integral part of a taxpayer's trade
or business and which is entered into in the normal course of
such trade or business, the determination of the potential
income from such transaction shall be made by taking into
account its relationship to the overall trade or business of
the taxpayer.
``(D) Treatment of fees.--In determining whether there is
risk of loss from a transaction (and the amount thereof),
potential loss of fees and other transaction expenses shall
be disregarded.
``(E) Treatment of economic return enhancements.--The
following shall be treated as economic returns and not tax
benefits:
``(i) The credit under section 29 (relating to credit for
producing fuel from a nonconventional source).
``(ii) The credit under section 42 (relating to low-income
housing credit).
``(iii) The credit under section 45 (relating to
electricity produced from certain renewable resources).
``(iv) The credit under section 1397E (relating to credit
to holders of qualified zone academy bonds) or any similar
program hereafter enacted.
``(v) Any other tax benefit specified in regulations.
``(F) Exceptions for nonbusiness transactions.--
``(i) Individuals.--In the case of an individual, this
subsection shall only apply to transactions entered into in
connection with a trade or business or activity engaged in
for profit.
``(ii) Charitable transfers.--This subsection shall not
apply in determining the amount allowable as a deduction
under section 170, 545(b)(2), 556(b)(2), or 642(c).
``(6) Economic substance doctrine, etc., not affected.--The
provisions of this subsection shall not be construed as
altering or supplanting any rule of law referred to in
section 6662(i)(2)(B) and the requirements of this subsection
shall be construed as being in addition to any such rule of
law.''

SEC. 267. INCREASE IN SUBSTANTIAL UNDERPAYMENT PENALTY WITH
RESPECT TO DISALLOWED NONECONOMIC TAX
ATTRIBUTES.

(a) In General.--Section 6662 of the Internal Revenue Code
of 1986 (relating to imposition of accuracy-related penalty)
is amended by adding at the end the following new subsection:
``(i) Increase in Penalty in Case of Disallowed Noneconomic
Tax Attributes.--
``(1) In general.--In the case of the portion of the
underpayment to which this subsection applies--
``(A) subsection (a) shall be applied with respect to such
portion by substituting `40 percent' for `20 percent', and
``(B) subsection (d)(2)(B) and section 6664(c) shall not
apply.
``(2) Underpayments to which subsection applies.--This
subsection shall apply to an underpayment to which this
section applies by reason of paragraph (1) or (2) of
subsection (b) but--
``(A) only to the extent that such underpayment is
attributable to--
``(i) the disallowance of any noneconomic tax attribute
(determined under section 7701(m)), or
``(ii) the disallowance of any other benefit--

``(I) because of a lack of economic substance or business
purpose for the transaction giving rise to the claimed
benefit,
``(II) because the form of the transaction did not reflect
its substance, or
``(III) because of any other similar rule of law, and

``(B) only if the underpayment so attributable exceeds
$1,000,000.
``(3) Increase in penalty not to apply if compliance with
disclosure requirements.--Paragraph (1)(A) shall not apply if
the taxpayer--
``(A) discloses to the Secretary within 30 days after the
closing of the transaction appropriate documents describing
the transaction, and
``(B) files with the taxpayer's return of tax imposed by
subtitle A--
``(i) a statement verifying that such disclosure has been
made,
``(ii) a detailed description of the facts, assumptions of
facts, and factual conclusions with respect to the business
or economic purposes or objectives of the transaction that
are relied upon to support the manner in which it is reported
on the return,
``(iii) a description of the due diligence performed to
ascertain the accuracy of such facts, assumptions, and
factual conclusions,
``(iv)(I) a statement (signed by the senior financial
officer of the corporation under penalty of perjury) that the
facts, assumptions, or factual conclusions relied upon in
reporting the transaction are true and correct as of the date
the return is filed, to the best of such officer's knowledge
and belief, and
``(II) if the actual facts varied materially from the
facts, assumptions, or factual conclusions relied upon, a
statement describing such variances,
``(v) copies of any written material provided in connection
with the offer of the transaction to the taxpayer by a third
party,
``(vi) a full description of any express or implied
agreement or arrangement with any advisor, or with any
offeror, that the fee payable to such person would be
contingent or subject to possible reimbursement, and
``(vii) a full description of any express or implied
warranty from any person with respect to the anticipated tax
results from the transaction.''
(b) Modifications to Penalty on Substantial Understatement
of Income Tax.--
(1) Modification of threshold.--Subparagraph (A) of section
6662(d)(2) of such Code is amended to read as follows:
``(A) In general.--For purposes of this section, there is a
substantial understatement of income tax for any taxable year
if the amount of the understatement for the taxable year
exceeds the lesser of--
``(i) $1,000,000, or
``(ii) the greater of 10 percent of the tax required to be
shown on the return for the taxable year or $5,000.''
(2) Reduction of penalty on account of disclosure not to
apply to tax shelters.--Subparagraph (C) of section
6662(d)(2) of such Code is amended by striking clause (ii),
by redesignating clause (iii) as clause (ii), and by striking
clause (i) and inserting the following new clause:
``(i) In general.--Subparagraph (B) shall not apply to any
item attributable to a tax shelter.''
(c) Treatment of Amended Returns.--Subsection (a) of
section 6664 of such Code is amended by adding at the end the
following new sentence: ``For purposes of this subsection, an
amended return shall be disregarded if such return is filed
on or after the date the taxpayer is first contacted by the
Secretary regarding the examination of the return.''

SEC. 268. PENALTY ON MARKETED TAX AVOIDANCE STRATEGIES WHICH
HAVE NO ECONOMIC SUBSTANCE, ETC.

(a) Penalty.--
(1) In general.--Section 6700 of the Internal Revenue Code
of 1986 (relating to promoting abusive tax shelters, etc.) is
amended by redesignating subsection (c) as subsection (d) and
by inserting after subsection (b) the following new
subsection:
``(c) Penalty on Substantial Promoters for Promoting Tax
Avoidance Strategies Which Have No Economic Substance, Etc.--
``(1) Imposition of penalty.--Any substantial promoter of a
tax avoidance strategy shall pay a penalty in the amount
determined under paragraph (2) with respect to such strategy
if any tax benefit attributable to such strategy (or any
similar strategy promoted by such promoter) is not allowable
by reason of any rule of law referred to in section
6662(i)(2)(A).
``(2) Amount of penalty.--The penalty under paragraph (1)
with respect to a promoter of a tax avoidance strategy is an
amount equal to 100 percent of the gross income derived (or
to be derived) by such promoter from such strategy.
``(3) Tax avoidance strategy.--For purposes of this
subsection, the term `tax avoidance strategy' means any
entity, plan, arrangement, or transaction a significant
purpose of the structure of which is the avoidance or evasion
of Federal income tax.
``(4) Substantial promoter.--For purposes of this
subsection --
``(A) In general.--The term `substantial promoter' means,
with respect to any tax avoidance strategy, any promoter if--
``(i) such promoter offers such strategy to more than 1
potential participant, and
``(ii) such promoter may receive fees in excess of
$1,000,000 in the aggregate with respect to such strategy.
``(B) Aggregation rules.--For purposes of this paragraph--
``(i) Related persons.--A promoter and all persons related
to such promoter shall be treated as 1 person.
``(ii) Similar strategies.--All similar tax avoidance
strategies of a promoter shall be treated as 1 tax avoidance
strategy.
``(C) Promoter.--The term `promoter' means any person who
participates in the promotion, offering, or sale of the tax
avoidance strategy.
``(D) Related person.--Persons are related if they bear a
relationship to each other which is described in section
267(b) or 707(b).
``(4) Coordination with subsection (a).--No penalty shall
be imposed by this subsection on any promoter with respect to
a tax avoidance strategy if a penalty is imposed under
subsection (a) on such promoter with respect to such
strategy.''
(2) Conforming amendment.--Subsection (d) of section 6700
of such Code is amended--
(A) by striking ``Penalty'' and inserting ``Penalties'',
and
(B) by striking ``penalty'' the first place it appears in
the text and inserting ``penalties''.
(b) Increase in Penalty on Promoting Abusive Tax
Shelters.--The first sentence of section 6700(a) of such Code
is amended by striking ``a penalty equal to'' and all that
follows and inserting ``a penalty equal to the greater of
$1,000 or 100 percent of the gross income derived (or to be
derived) by such person from such activity.''

SEC. 269. EFFECTIVE DATES.

(a) In General.--Except as provided in subsections (b) and
(c), the amendments made by this subpart shall apply to
transactions after the date of the enactment of this Act.
(b) Section 267.--The amendments made by subsections (b)
and (c) of section 267 shall

[[Page H789]]

apply to taxable years ending after the date of the enactment
of this Act.
(c) Section 268.--The amendments made by subsection (a) of
section 268 shall apply to any tax avoidance strategy (as
defined in section 6700(c) of the Internal Revenue Code of
1986, as amended by this title) interests in which are
offered to potential participants after the date of the
enactment of this Act.

Subpart B--Limitations on Importation or Transfer of Built-in Losses

SEC. 271. LIMITATION ON IMPORTATION OF BUILT-IN LOSSES.

(a) In General.--Section 362 of the Internal Revenue Code
of 1986 (relating to basis to corporations) is amended by
adding at the end the following new subsection:
``(e) Limitation on Importation of Built-in Losses.--
``(1) In general.--If in any transaction described in
subsection (a) or (b) there would (but for this subsection)
be an importation of a net built-in loss, the basis of each
property described in paragraph (2) which is acquired in such
transaction shall (notwithstanding subsections (a) and (b))
be its fair market value immediately after such transaction.
``(2) Property described.--For purposes of paragraph (1),
property is described in this paragraph if--
``(A) gain or loss with respect to such property is not
subject to tax under this subtitle in the hands of the
transferor immediately before the transfer, and
``(B) gain or loss with respect to such property is subject
to such tax in the hands of the transferee immediately after
such transfer.
In any case in which the transferor is a partnership, the
preceding sentence shall be applied by treating each partner
in such partnership as holding such partner's proportionate
share of the property of such partnership.
``(3) Importation of net built-in loss.--For purposes of
paragraph (1), there is an importation of a net built-in loss
in a transaction if the transferee's aggregate adjusted bases
of property described in paragraph (2) which is transferred
in such transaction would (but for this subsection) exceed
the fair market value of such property immediately after such
transaction.''
(b) Comparable Treatment Where Liquidation.--Paragraph (1)
of section 334(b) of such Code (relating to liquidation of
subsidiary) is amended to read as follows:
``(1) In general.--If property is received by a corporate
distributee in a distribution in a complete liquidation to
which section 332 applies (or in a transfer described in
section 337(b)(1)), the basis of such property in the hands
of such distributee shall be the same as it would be in the
hands of the transferor; except that the basis of such
property in the hands of such distributee shall be the fair
market value of the property at the time of the
distribution--
``(A) in any case in which gain or loss is recognized by
the liquidating corporation with respect to such property, or
``(B) in any case in which the liquidating corporation is a
foreign corporation, the corporate distributee is a domestic
corporation, and the corporate distributee's aggregate
adjusted bases of property described in section 362(e)(2)
which is distributed in such liquidation would (but for this
subparagraph) exceed the fair market value of such property
immediately after such liquidation.''
(c) Effective Date.--The amendments made by this section
shall apply to transactions after the date of the enactment
of this Act.

SEC. 272. DISALLOWANCE OF PARTNERSHIP LOSS TRANSFERS.

(a) Treatment of Contributed Property With Built-in Loss.--
Paragraph (1) of section 704(c) of the Internal Revenue Code
of 1986 is amended by striking ``and'' at the end of
subparagraph (A), by striking the period at the end of
subparagraph (B) and inserting ``, and'', and by adding at
the end the following:
``(C) if any property so contributed has a built-in loss--
``(i) such built-in loss shall be taken into account only
in determining the amount of items allocated to the
contributing partner, and
``(ii) except as provided in regulations, in determining
the amount of items allocated to other partners, the basis of
the contributed property in the hands of the partnership
shall be treated as being equal to its fair market value
immediately after the contribution.
For purposes of subparagraph (C), the term `built-in loss'
means the excess of the adjusted basis of the property over
its fair market value immediately after the contribution.''
(b) Adjustment to Basis of Partnership Property on Transfer
of Partnership Interest If There is Substantial Built-in
Loss.--
(1) Adjustment required.--Subsection (a) of section 743 of
such Code (relating to optional adjustment to basis of
partnership property) is amended by inserting before the
period ``or unless the partnership has a substantial built-in
loss immediately after such transfer''.
(2) Adjustment.--Subsection (b) of section 743 of such Code
is amended by inserting ``or with respect to which there is a
substantial built-in loss immediately after such transfer''
after ``section 754 is in effect''.
(3) Substantial built-in loss.--Section 743 of such Code is
amended by adding at the end the following new subsection:
``(d) Substantial Built-in Loss.--For purposes of this
section, a partnership has a substantial built-in loss with
respect to a transfer of an interest in a partnership if the
transferee partner's proportionate share of the adjusted
basis of the partnership property exceeds 110 percent of the
basis of such partner's interest in the partnership.''
(4) Clerical amendments.--
(A) The section heading for section 743 of such Code is
amended to read as follows:

``SEC. 743. ADJUSTMENT TO BASIS OF PARTNERSHIP PROPERTY WHERE
SECTION 754 ELECTION OR SUBSTANTIAL BUILT-IN
LOSS.''

(B) The table of sections for subpart C of part II of
subchapter K of chapter 1 of such Code is amended by striking
the item relating to section 743 and inserting the following
new item:

``Sec. 743. Adjustment to basis of partnership property where section
754 election or substantial built-in loss.''
(c) Adjustment to Basis of Undistributed Partnership
Property If There is Substantial Basis Reduction.--
(1) Adjustment required.--Subsection (a) of section 734 of
such Code (relating to optional adjustment to basis of
undistributed partnership property) is amended by inserting
before the period ``or unless there is a substantial downward
adjustment''.
(2) Adjustment.--Subsection (b) of section 734 of such Code
is amended by inserting ``or unless there is a substantial
downward adjustment'' after ``section 754 is in effect''.
(3) Substantial downward adjustment.--Section 734 of such
Code is amended by adding at the end the following new
subsection:
``(d) Substantial Downward Adjustment.--For purposes of
this section, there is a substantial downward adjustment with
respect to a distribution if the sum of the amounts described
in subparagraphs (A) and (B) of subsection (b)(2) exceeds 10
percent of the aggregate adjusted basis of partnership
property immediately after the distribution.''
(4) Clerical amendments.--
(A) The section heading for section 734 of such Code is
amended to read as follows:

``SEC. 734. ADJUSTMENT TO BASIS OF UNDISTRIBUTED PARTNERSHIP
PROPERTY WHERE SECTION 754 ELECTION OR
SUBSTANTIAL BASIS REDUCTION.''

(B) The table of sections for subpart B of part II of
subchapter K of chapter 1 of such Code is amended by striking
the item relating to section 734 and inserting the following
new item:

``Sec. 734. Adjustment to basis of undistributed partnership property
where section 754 election or substantial basis
reduction.''
(d) Effective Dates.--
(1) Subsection (a).--The amendment made by subsection (a)
shall apply to contributions made after the date of the
enactment of this Act.
(2) Subsection (b).--The amendments made by subsection (a)
shall apply to transfers after the date of the enactment of
this Act.
(3) Subsection (c).--The amendments made by subsection (a)
shall apply to distributions after the date of the enactment
of this Act.

PART III--ESTATE AND GIFT TAX OFFSETS

SEC. 276. VALUATION RULES FOR TRANSFERS INVOLVING NONBUSINESS
ASSETS.

(a) In General.--Section 2031 of the Internal Revenue Code
of 1986 (relating to definition of gross estate) is amended
by redesignating subsection (d) as subsection (e) and by
inserting after subsection (c) the following new subsection:
``(d) Valuation Rules for Certain Transfers of Nonbusiness
Assets.--For purposes of this chapter and chapter 12--
``(1) In general.--In the case of the transfer of any
interest in an entity other than an interest which is
actively traded (within the meaning of section 1092), the
value of such interest shall be determined by taking into
account--
``(A) the value of such interest's proportionate share of
the nonbusiness assets of such entity (and no valuation
discount shall be allowed with respect to such nonbusiness
assets), plus
``(B) the value of such entity determined without regard to
the value taken into account under subparagraph (A).
``(2) Nonbusiness assets.--For purposes of this
subsection--
``(A) In general.--The term `nonbusiness asset' means any
asset which is not used in the active conduct of 1 or more
trades or businesses.
``(B) Exception for certain passive assets.--Except as
provided in subparagraph (C), a passive asset shall not be
treated for purposes of subparagraph (A) as used in the
active conduct of a trade or business unless--
``(i) the asset is property described in paragraph (1) or
(4) of section 1221(a) or is a hedge with respect to such
property, or
``(ii) the asset is real property used in the active
conduct of 1 or more real property trades or businesses
(within the meaning of section 469(c)(7)(C)) in which the
transferor materially participates and with respect to which
the transferor meets the requirements of section
469(c)(7)(B)(ii).
For purposes of clause (ii), material participation shall be
determined under the rules of section 469(h), except that
section 469(h)(3) shall be applied without regard to the
limitation to farming activity.
``(C) Exception for working capital.--Any asset (including
a passive asset) which is held as a part of the reasonably
required

[[Page H790]]

working capital needs of a trade or business shall be treated
as used in the active conduct of a trade or business.
``(3) Passive asset.--For purposes of this subsection, the
term `passive asset' means any--
``(A) cash or cash equivalents,
``(B) except to the extent provided by the Secretary, stock
in a corporation or any other equity, profits, or capital
interest in any entity,
``(C) evidence of indebtedness, option, forward or futures
contract, notional principal contract, or derivative,
``(D) asset described in clause (iii), (iv), or (v) of
section 351(e)(1)(B),
``(E) annuity,
``(F) real property used in 1 or more real property trades
or businesses (as defined in section 469(c)(7)(C)),
``(G) asset (other than a patent, trademark, or copyright)
which produces royalty income,
``(H) commodity,
``(I) collectible (within the meaning of section 401(m)),
or
``(J) any other asset specified in regulations prescribed
by the Secretary.
``(4) Look-thru rules.--
``(A) In general.--If a nonbusiness asset of an entity
consists of a 10-percent interest in any other entity, this
subsection shall be applied by disregarding the 10-percent
interest and by treating the entity as holding directly its
ratable share of the assets of the other entity. This
subparagraph shall be applied successively to any 10-percent
interest of such other entity in any other entity.
``(B) 10-percent interest.--The term `10-percent interest'
means--
``(i) in the case of an interest in a corporation,
ownership of at least 10 percent (by vote or value) of the
stock in such corporation,
``(ii) in the case of an interest in a partnership,
ownership of at least 10 percent of the capital or profits
interest in the partnership, and
``(iii) in any other case, ownership of at least 10 percent
of the beneficial interests in the entity.
``(5) Coordination with subsection (b).--Subsection (b)
shall apply after the application of this subsection.''
(b) Effective Date.--The amendments made by this section
shall apply to transfers after the date of the enactment of
this Act.

SEC. 277. CORRECTION OF TECHNICAL ERROR AFFECTING LARGEST
ESTATES.

(a) In General.--Paragraph (2) of section 2001(c) of the
Internal Revenue Code of 1986 is amended by striking
``$10,000,000'' and all that follows and inserting
``$10,000,000. The amount of the increase under the preceding
sentence shall not exceed the sum of the applicable credit
amount under section 2010(c) (as increased by section 2010A)
and $359,200.''
(b) Effective Date.--The amendment made by this section
shall apply to estates of decedents dying, and gifts made,
after December 31, 2000.

PART IV--OTHER OFFSETS

SEC. 281. CONSISTENT AMORTIZATION PERIODS FOR INTANGIBLES.

(a) Start-Up Expenditures.--
(1) Allowance of deduction.--Paragraph (1) of section
195(b) of the Internal Revenue Code of 1986 (relating to
start-up expenditures) is amended to read as follows:
``(1) Allowance of Deduction.--If a taxpayer elects the
application of this subsection with respect to any start-up
expenditures--
``(A) the taxpayer shall be allowed a deduction for the
taxable year in which the active trade or business begins in
an amount equal to the lesser of--
``(i) the amount of start-up expenditures with respect to
the active trade or business, or
``(ii) $5,000, reduced (but not below zero) by the amount
by which such start-up expenditures exceed $50,000, and
``(B) the remainder of such start-up expenditures shall be
allowed as a deduction ratably over the 180-month period
beginning with the month in which the active trade or
business begins.''
(2) Conforming amendment.--Subsection (b) of section 195 is
amended by striking ``Amortize'' and inserting ``Deduct'' in
the heading.
(b) Organizational Expenditures.--Subsection (a) of section
248 of such Code (relating to organizational expenditures) is
amended to read as follows:
``(a) Election to Deduct.--If a corporation elects the
application of this subsection (in accordance with
regulations prescribed by the Secretary) with respect to any
organizational expenditures--
``(1) the corporation shall be allowed a deduction for the
taxable year in which the corporation begins business in an
amount equal to the lesser of--
``(A) the amount of organizational expenditures with
respect to the taxpayer, or
``(B) $5,000, reduced (but not below zero) by the amount by
which such organizational expenditures exceed $50,000, and
``(2) the remainder of such organizational expenditures
shall be allowed as a deduction ratably over the 180-month
period beginning with the month in which the corporation
begins business.''
(c) Treatment of Organizational and Syndication Fees or
Partnerships.--Section 709(b) of such Code (relating to
amortization of organization fees) is amended by
redesignating paragraph (2) as paragraph (4) and by amending
paragraph (1) to read as follows:
``(1) Allowance of deduction.--If a taxpayer elects the
application of this subsection (in accordance with
regulations prescribed by the Secretary) with respect to any
organizational expenses--
``(A) the taxpayer shall be allowed a deduction for the
taxable year in which the partnership begins business in an
amount equal to the lesser of--
``(i) the amount of organizational expenses with respect to
the partnership, or
``(ii) $5,000, reduced (but not below zero) by the amount
by which such organizational expenses exceed $50,000, and
``(B) the remainder of such organizational expenses shall
be allowed as a deduction ratably over the 180-month period
beginning with the month in which the partnership begins
business.
``(2) Dispositions before close of amortization period.--In
any case in which a partnership is liquidated before the end
of the period to which paragraph (1)(B) applies, any deferred
expenses attributable to the partnership which were not
allowed as a deduction by reason of this section may be
deducted to the extent allowable under section 165.''
(d) Conforming Amendment.--Subsection (b) of section 709 of
such Code is amended by striking ``Amortization'' and
inserting ``Deduction'' in the heading.
(e) Effective Date.--The amendments made by this section
shall apply to amounts paid or incurred after the date of the
enactment of this Act.

SEC. 282. MODIFICATION OF FOREIGN TAX CREDIT CARRYOVER RULES.

(a) In General.--Section 904(c) of the Internal Revenue
Code of 1986 (relating to limitation on credit) is amended--
(1) by striking ``in the second preceding taxable year,'',
and
(2) by striking ``or fifth'' and inserting ``fifth, sixth,
or seventh''.
(b) Effective Date.--The amendment made by subsection (a)
shall apply to credits arising in taxable years beginning
after December 31, 2000.

SEC. 283. RECOGNITION OF GAIN ON TRANSFERS TO SWAP FUNDS.

(a) Interests Similar to Preferred Stock Treated as
Stock.--Clause (vi) of section 351(e)(1)(B) of the Internal
Revenue Code of 1986 (relating to transfer of property to an
investment company) is amended to read as follows:
``(vi) except as otherwise provided in regulations
prescribed by the Secretary--

``(I) any interest in an entity if the return on such
interest is limited and preferred, and
``(II) interests (not described in subclause (I)) in any
entity if substantially all of the assets of such entity
consist (directly or indirectly) of any assets described in
subclause (I), any preceding clause, or clause (viii).''

(b) Certain Transfers Deemed To Be to Investment
Companies.--Subsection (e) of section 351 of such Code is
amended by adding at the end the following new paragraph:
``(3) Transfers of marketable securities to certain
corporations.--A transfer of property to a corporation if--
``(A) such property is marketable securities (as defined in
section 731(c)(2)), other than a diversified portfolio of
securities,
``(B) such corporation--
``(i) is registered under the Investment Company Act of
1940 as an investment company, or is exempt from registration
as a investment company under section 3(c)(7) of such Act
because interests in such corporation are offered to
qualified purchasers within the meaning of section 2(a)(51)
of such Act, or
``(ii) is formed or availed of for purposes of allowing
persons who have significant blocks of marketable securities
with unrealized appreciation to diversify those holdings
without recognition of gain, and
``(C) the transfer results, directly or indirectly, in
diversification of the transferor's interest.''
(c) Transfers to Partnerships.--Subsection (b) of section
721 of such Code is amended to read as follows:
``(b) Special Rule.--Subsection (a) shall not apply to gain
realized on a transfer of property to a partnership if, were
the partnership incorporated--
``(1) such partnership would be treated as an investment
company (within the meaning of section 351), or
``(2) section 351 would not apply to such transfer by
reason of section 351(e)(3).''
(d) Effective Date.--
(1) In general.--The amendments made by this section shall
apply to transfers after March 8, 2000.
(2) Binding contracts.--The amendments made by this section
shall not apply to any transfer pursuant to a written binding
contract in effect on August 4, 1999, and at all times
thereafter before such transfer if such contract provides for
the transfer of a fixed amount of property.
Sec. 5. The amendment specified in section 2 of this
resolution is as follows:
Strike all after the enacting clause and insert the
following:
At the appropriate place, insert the following:
TITLE --MINIMUM WAGE INCREASE

SEC. 01. SHORT TITLE.

This title may be cited as the ``Fair Minimum Wage Act of
2000.''

SEC. 02. MINIMUM WAGE INCREASE.

Paragraph (1) of section 6(a) of the Fair Labor Standards
Act of 1938 (29 U.S.C. 206(a)(1)) is amended to read as
follows:

[[Page H791]]

``(1) except as otherwise provided in this section, not
less than--
``(A) $5.65 an hour during the year beginning on the date
that is 30 days after the date of enactment of the Fair
Minimum Wage Act of 2000; and
``(B) $6.15 an hour beginning on the date that is 1 year
after the date on which the increase in subparagraph (A)
takes effect;''.

SEC. 03. MINIMUM WAGE IN THE COMMONWEALTH OF THE NORTHERN
MARIANA ISLANDS.

(a) In General.--Subject to subsection (b), the provisions
of section 6 of the Fair Labor Standards Act of 1938 (29
U.S.C. 206) shall apply to the Commonwealth of the Northern
Mariana Islands.
(b) Transition.--
(1) In general.--Notwithstanding subsection (a), the
minimum wage applicable to the Commonwealth of the Northern
Mariana Islands under section 6(a)(1) of the Fair Labor
Standards Act of 1938 (29 U.S.C. 206(a)(1)) shall be $3.55 an
hour beginning on the date that is 30 days after the date of
enactment of this section.
(2) Increases in minimum wage.--
(A) In general.--On the date that is 6 months after the
date of enactment of this Act, and every 6 months thereafter,
the minimum wage applicable to the Commonwealth of the
Northern Mariana Islands under section 6(a)(1) of the Fair
Labor Standards Act of 1938 (29 U.S.C. 206(a)(1)) shall be
increased by $0.50 per hour (or such a leaser amount as may
be necessary to equal the minimum wage under such section)
until such time as the minimum wage applicable to the
Commonwealth of the Northern Mariana Islands under this
subsection is equal to the minimum wage set forth in section
6(a)(1) of such Act for the date involved.
(B) Further increases.--With respect to dates beginning
after the minimum wage applicable to the Commonwealth of the
Northern Mariana Islands is equal to the minimum wage set
forth in section 6(a)(1) of the Fair Labor Standards Act of
1938 (29 U.S.C. 206(a)(1)), as provided in subparagraph (A),
such applicable minimum wage shall be immediately increased
so as to remain equal to the minimum wage set forth in
section 6(a)(1) of such Act for the date involved.

Mr. MOAKLEY: Mr. Speaker, I yield back the balance of my time.
Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
Today, we have had an opportunity to have a vigorous debate about the
rule, the rule which will decide how we are going to follow forth on
talking about the bill that is before us.
We have a tax bill, a tax bill that gives an opportunity to the
workers of America to have more small businesses, and more people who
want to take that risk and opportunity to go and invest their savings
and to open up their own stores and to do things that might be a
lifetime dream. On the other hand, we are going to allow a vote that
would be very directly for people who wish to support raising the
minimum wage.
What we have done is we have crafted a fair rule. We have talked
about the essence of what Republicans and Democrats are all about
today; and I am very, very proud of what we have done and appreciate
those who have spoken today.
There is an amendment at the desk, Mr. Speaker. The amendment will
strike out the language allowing States to opt out of the minimum-wage
increase.

Amendment Offered by Mr. Sessions

Mr. SESSIONS. Mr. Speaker, I ask unanimous consent that the amendment
at the desk be considered as adopted.
The SPEAKER pro tempore (Mr. LaHood). The Clerk will report the
amendment.
The Clerk read as follows:

Amendment offered by Mr. Sessions:
Strike section 2 and insert the following:
Sec. 2. Upon the adoption of this resolution it shall be in
order to consider in the House the bill (H.R. 3846) to amend
the Fair Labor Standards Act of 1938 to increase the minimum
wage, and for other purposes. An amendment striking section 5
shall be considered adopted. The bill, as amended, shall be
considered as read for amendment. The previous question shall
be considered as ordered on the bill, as amended, and any
further amendment thereto to final passage without
intervening motion except: (1) one hour of debate equally
divided and controlled by the chairman and ranking minority
member of the Committee on Education and the Workforce; (2)
the amendment numbered 2 in House Report 106-516, which shall
be in order without intervention of any point of order
(except those arising under section 425 of the Congressional
Budget Act of 1974) and which may be offered only by a Member
designated in the report, shall be considered as read, and
shall be separately debatable for the time specified in the
report equally divided and controlled by the proponent and an
opponent; and (3) one motion to recommit with or without
instructions.

The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Texas?
There was no objection.
The SPEAKER pro tempore. The amendment is agreed to.
Mr. SESSIONS. Mr. Speaker, I move the previous question on the
resolution, as amended.
The SPEAKER pro tempore. The question is on ordering the previous
question.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.
Mr. MOAKLEY. Mr. Speaker, I object to the vote on the ground that a
quorum is not present and make the point of order that a quorum is not
present.
The SPEAKER pro tempore. Evidently a quorum is not present.
The Sergeant at Arms will notify absent Members.
Pursuant to clause 9 of rule XX, the Chair announces that he will
reduce to a minimum of 5 minutes the period of time within which a vote
by electronic device, if ordered, will be taken on the question of
agreeing to the resolution, as amended.
The vote was taken by electronic device, and there were--yeas 216,
nays 208, not voting 10, as follows:

[Roll No. 38]

YEAS--216

Aderholt
Archer
Armey
Bachus
Baker
Ballenger
Barr
Barrett (NE)
Bartlett
Barton
Bass
Bateman
Bereuter
Biggert
Bilbray
Bilirakis
Bliley
Blunt
Boehlert
Boehner
Bonilla
Bono
Brady (TX)
Bryant
Burr
Burton
Buyer
Callahan
Calvert
Camp
Campbell
Canady
Cannon
Castle
Chabot
Chambliss
Chenoweth-Hage
Coble
Coburn
Collins
Combest
Cook
Cox
Crane
Cubin
Cunningham
Davis (VA)
Deal
DeLay
DeMint
Diaz-Balart
Dickey
Doolittle
Dreier
Duncan
Dunn
Ehlers
Ehrlich
Emerson
English
Everett
Ewing
Fletcher
Foley
Fossella
Fowler
Franks (NJ)
Frelinghuysen
Gallegly
Ganske
Gekas
Gibbons
Gilchrest
Gillmor
Gilman
Goode
Goodlatte
Goodling
Goss
Graham
Green (WI)
Greenwood
Hansen
Hastings (WA)
Hayes
Hayworth
Hefley
Herger
Hill (MT)
Hilleary
Hobson
Hoekstra
Horn
Hostettler
Houghton
Hulshof
Hunter
Hutchinson
Hyde
Isakson
Istook
Jenkins
Johnson (CT)
Johnson, Sam
Jones (NC)
Kasich
Kelly
King (NY)
Kingston
Knollenberg
Kolbe
Kuykendall
LaHood
Largent
Latham
LaTourette
Lazio
Leach
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas (OK)
Manzullo
Martinez
McCrery
McHugh
McInnis
McIntosh
McKeon
Metcalf
Mica
Miller (FL)
Miller, Gary
Moran (KS)
Morella
Nethercutt
Ney
Northup
Norwood
Nussle
Ose
Oxley
Packard
Paul
Pease
Peterson (PA)
Petri
Pickering
Pitts
Pombo
Porter
Portman
Pryce (OH)
Quinn
Radanovich
Ramstad
Regula
Reynolds
Riley
Rogan
Rogers
Rohrabacher
Ros-Lehtinen
Roukema
Royce
Ryan (WI)
Ryun (KS)
Salmon
Sanford
Saxton
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simpson
Skeen
Smith (MI)
Smith (NJ)
Smith (TX)
Souder
Stearns
Stump
Sununu
Sweeney
Talent
Tancredo
Tauzin
Taylor (NC)
Terry
Thomas
Thornberry
Thune
Tiahrt
Toomey
Traficant
Upton
Vitter
Walden
Walsh
Wamp
Watkins
Watts (OK)
Weldon (FL)
Weldon (PA)
Weller
Whitfield
Wicker
Wilson
Wolf
Young (AK)
Young (FL)

NAYS--208

[[Page H792]]

Jackson-Lee (TX)
Jefferson
John
Johnson, E. B.
Jones (OH)
Kanjorski
Kaptur
Kennedy
Kildee
Kilpatrick
Kind (WI)
Kleczka
Klink
Kucinich
LaFalce
Lampson
Lantos
Larson
Lee
Levin
Lewis (GA)
Lipinski
Lofgren
Lowey
Lucas (KY)
Luther
Maloney (CT)
Maloney (NY)
Markey
Mascara
Matsui
McCarthy (MO)
McCarthy (NY)
McDermott
McGovern
McIntyre
McKinney
McNulty
Meehan
Meeks (NY)
Menendez
Millender-McDonald
Miller, George
Minge
Mink
Moakley
Mollohan
Moore
Moran (VA)
Murtha
Nadler
Napolitano
Neal
Oberstar
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Peterson (MN)
Phelps
Pickett
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Rivers
Rodriguez
Roemer
Rothman
Roybal-Allard
Rush
Sabo
Sanchez
Sanders
Sandlin
Sawyer
Schakowsky
Scott
Serrano
Sherman
Shows
Sisisky
Skelton
Slaughter
Smith (WA)
Snyder
Spratt
Stabenow
Stark
Stenholm
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Thurman
Tierney
Towns
Turner
Udall (CO)
Udall (NM)
Velazquez
Visclosky
Waters
Watt (NC)
Waxman
Weiner
Wexler
Weygand
Wise
Woolsey
Wu
Wynn

NOT VOTING--10

Brown (OH)
Cooksey
Granger
McCollum
Meek (FL)
Myrick
Scarborough
Schaffer
Spence
Vento

{time} 1516

Messrs. JEFFERSON, JOHN and POMEROY changed their vote from ``yea''
to ``nay.''
Mr. PITTS and Mr. GILMAN changed their vote from ``nay'' to ``yea.''
So the previous question was ordered.
The result of the vote was announced as above recorded.
The SPEAKER pro tempore (Mr. LaHood). The question is on the
resolution, as amended.
The question was taken; and the Speaker pro tempore announced that
the ayes appeared to have it.

Recorded Vote

Mr. MOAKLEY. Mr. Speaker, I demand a recorded vote.
A recorded vote was ordered.
The SPEAKER pro tempore. This is a 5-minute vote.
The vote was taken by electronic device, and there were--ayes 214,
noes 211, not voting 10, as follows:

[Roll No. 39]

AYES--214

Aderholt
Archer
Armey
Bachus
Baker
Ballenger
Barr
Barrett (NE)
Bartlett
Barton
Bass
Bateman
Bereuter
Biggert
Bilbray
Bilirakis
Bliley
Blunt
Boehlert
Boehner
Bonilla
Bono
Brady (TX)
Bryant
Burr
Burton
Buyer
Callahan
Calvert
Camp
Campbell
Canady
Cannon
Castle
Chabot
Chambliss
Chenoweth-Hage
Coble
Coburn
Collins
Combest
Cook
Cox
Crane
Cubin
Cunningham
Davis (VA)
Deal
DeLay
DeMint
Diaz-Balart
Dickey
Doolittle
Dreier
Duncan
Dunn
Ehlers
Ehrlich
Emerson
English
Everett
Ewing
Fletcher
Foley
Fossella
Fowler
Franks (NJ)
Frelinghuysen
Gallegly
Ganske
Gekas
Gibbons
Gilchrest
Gillmor
Gilman
Goode
Goodlatte
Goodling
Goss
Graham
Green (WI)
Greenwood
Hansen
Hastert
Hastings (WA)
Hayes
Hayworth
Herger
Hill (MT)
Hilleary
Hobson
Hoekstra
Horn
Hostettler
Houghton
Hulshof
Hunter
Hutchinson
Hyde
Isakson
Jenkins
Johnson (CT)
Johnson, Sam
Jones (NC)
Kasich
Kelly
King (NY)
Kingston
Knollenberg
Kolbe
Kuykendall
LaHood
Largent
Latham
LaTourette
Lazio
Leach
Lewis (CA)
Lewis (KY)
Linder
LoBiondo
Lucas (OK)
Manzullo
Martinez
McCrery
McHugh
McInnis
McIntosh
McKeon
Metcalf
Mica
Miller (FL)
Miller, Gary
Moran (KS)
Morella
Nethercutt
Ney
Northup
Norwood
Nussle
Ose
Oxley
Packard
Paul
Pease
Peterson (PA)
Petri
Pickering
Pitts
Pombo
Porter
Portman
Pryce (OH)
Quinn
Radanovich
Ramstad
Regula
Reynolds
Riley
Rogan
Rogers
Rohrabacher
Ros-Lehtinen
Roukema
Royce
Ryan (WI)
Ryun (KS)
Salmon
Sanford
Saxton
Sensenbrenner
Sessions
Shadegg
Shaw
Shays
Sherwood
Shimkus
Shuster
Simpson
Skeen
Smith (MI)
Smith (NJ)
Smith (TX)
Souder
Stearns
Stump
Sununu
Sweeney
Talent
Tancredo
Tauzin
Taylor (NC)
Thomas
Thornberry
Thune
Tiahrt
Toomey
Traficant
Upton
Vitter
Walden
Walsh
Wamp
Watkins
Watts (OK)
Weldon (FL)
Weldon (PA)
Weller
Whitfield
Wicker
Wilson
Wolf
Young (AK)
Young (FL)

NOES--211

Abercrombie
Ackerman
Allen
Andrews
Baca
Baird
Baldacci
Baldwin
Barcia
Barrett (WI)
Becerra
Bentsen
Berkley
Berman
Berry
Bishop
Blagojevich
Blumenauer
Bonior
Borski
Boswell
Boucher
Boyd
Brady (PA)
Brown (FL)
Capps
Capuano
Cardin
Carson
Clay
Clayton
Clement
Clyburn
Condit
Conyers
Costello
Coyne
Cramer
Crowley
Cummings
Danner
Davis (FL)
Davis (IL)
DeFazio
DeGette
Delahunt
DeLauro
Deutsch
Dicks
Dingell
Dixon
Doggett
Dooley
Doyle
Edwards
Engel
Eshoo
Etheridge
Evans
Farr
Fattah
Filner
Forbes
Ford
Frank (MA)
Frost
Gejdenson
Gephardt
Gonzalez
Gordon
Green (TX)
Gutierrez
Gutknecht
Hall (OH)
Hall (TX)
Hastings (FL)
Hefley
Hill (IN)
Hilliard
Hinchey
Hinojosa
Hoeffel
Holden
Holt
Hooley
Hoyer
Inslee
Istook
Jackson (IL)
Jackson-Lee (TX)
Jefferson
John
Johnson, E.B.
Jones (OH)
Kanjorski
Kaptur
Kennedy
Kildee
Kilpatrick
Kind (WI)
Kleczka
Klink
Kucinich
LaFalce
Lampson
Lantos
Larson
Lee
Levin
Lewis (GA)
Lipinski
Lofgren
Lowey
Lucas (KY)
Luther
Maloney (CT)
Maloney (NY)
Markey
Mascara
Matsui
McCarthy (MO)
McCarthy (NY)
McDermott
McGovern
McIntyre
McKinney
McNulty
Meehan
Meek (FL)
Meeks (NY)
Menendez
Millender-McDonald
Miller, George
Minge
Mink
Moakley
Mollohan
Moore
Moran (VA)
Murtha
Nadler
Napolitano
Neal
Oberstar
Obey
Olver
Ortiz
Owens
Pallone
Pascrell
Pastor
Payne
Pelosi
Peterson (MN)
Phelps
Pickett
Pomeroy
Price (NC)
Rahall
Rangel
Reyes
Rivers
Rodriguez
Roemer
Rothman
Roybal-Allard
Rush
Sabo
Sanchez
Sanders
Sandlin
Sawyer
Schakowsky
Scott
Serrano
Sherman
Shows
Sisisky
Skelton
Slaughter
Smith (WA)
Snyder
Spratt
Stabenow
Stark
Stenholm
Strickland
Stupak
Tanner
Tauscher
Taylor (MS)
Thompson (CA)
Thompson (MS)
Thurman
Tierney
Towns
Turner
Udall (CO)
Udall (NM)
Velazquez
Visclosky
Waters
Watt (NC)
Waxman
Weiner
Wexler
Weygand
Wise
Woolsey
Wu
Wynn

NOT VOTING--10

Brown (OH)
Cooksey
Granger
McCollum
Myrick
Scarborough
Schaffer
Spence
Terry
Vento

{time} 1527

So the resolution, as amended, was agreed to.
The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.
Stated for:
Mr. TERRY. Mr. Speaker, on rollcall No. 39, I was inadvertently
detained. Had I been present, I would have voted ``yes.''

____________________