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# Legislative Bulletin...........................................January 23, 2007

> **Contents:**
>
> **H.R. 323---**Seasoned Customer CTR Exemption Act
>
> **H.R. 392---**District of Columbia and United States Territories
> Circulating Quarter Dollar Program Act
>
> **H.R. 599** --- To direct the Secretary of Homeland Security to
> streamline the SAFETY Act and anti-terrorism technology procurement
> process

H.R. 599 --- To direct the Secretary of Homeland Security to streamline
the SAFETY Act and anti-terrorism technology procurement process

(*Langevin, D-RI*)

**[Order of Business]{.underline}:** The bill is scheduled for
consideration on Tuesday, January 23, 2007, under a motion to suspend
the rules and pass the bill.

**[Summary]{.underline}:** H.R. 599 would require the Department of
Homeland Security (DHS) to "streamline" the SAFETY Act, among other
things. Specifically, the bill requires the following:

-   Requires DHS to ensure that a "sufficient number" of qualified
    personnel are involved in the review and prioritization of
    anti-terrorism technologies, to determine whether these technologies
    can be designated as "qualified anti-terrorism technologies" under
    862(b) of the SAFETY Act (6 USC 441(b)); this would necessarily
    include an analysis of the legal, economic, and risk implications of
    utilizing such technologies;

-   Requires DHS to:

1)  establish a formal coordination process (to include various key DHS
    personnel) to ensure the maximum application of the litigation and
    risk management provisions of the SAFETY Act to anti-terrorism
    technologies procured by DHS;

2)  promote awareness and utilization of the litigation and risk
    management provisions of the SAFETY Act in the procurement of
    anti-terrorism technologies.

> [Note]{.underline}: According to the Homeland Security Committee,
> these provisions are intended to limit the liability of sellers of
> pertinent technologies from third party claims arising out of an act
> of terrorism, where the particular technology has been utilized to
> prevent such an act of terrorism.

-   Requires DHS to issue a departmental directive providing for
    coordination between DHS procurement officials and any other DHS
    official that is responsible for implementing the SAFETY Act in
    advance of any DHS procurement of an anti-terrorism technology.

**[Additional Information]{.underline}:** The SAFETY Act was passed as
part of the Homeland Security Act of 2002 (P.L. 107-296). According to
DHS, it was enacted to provide "risk management" and "litigation
management" protections for sellers of qualified anti-terrorism
technologies and others in the supply and distribution chain. As such,
the Act provides for certain liability limitations for claims arising
out of an act of terrorism. There is a formal application and approval
process required for sellers who wish to be protected under the SAFETY
Act.

For additional information regarding the SAFETY Act, please visit:
<https://www.safetyact.gov/>.

**[Committee Action]{.underline}:** H.R. 599 was introduced on January
22, 2007, and referred to the Committee on Homeland Security, which took
no official action.

**[Cost to Taxpayers]{.underline}:** A CBO score of H.R. 599 is
unavailable

**[Does the Bill Expand the Size and Scope of the Federal
Government?]{.underline}:** As noted above, the bill requires increased
coordination and risk assessment when utilizing anti-terrorism
technologies.

**[Does the Bill Contain Any New State-Government, Local-Government, or
Private-Sector Mandates?]{.underline}:** No.

**[Constitutional Authority]{.underline}:** A committee report citing
constitutional authority is unavailable.

House Rule XIII, Section 3(d)(1), requires that all committee reports
contain "a statement citing the *specific* powers granted to Congress in
the Constitution to enact the law proposed by the bill or joint
resolution." *\[emphasis added\]*

**[RSC Staff Contact]{.underline}:** Derek V. Baker;
[derek.baker@mail.house.gov](mailto:Derek.baker@mail.house.gov);
202-226-8585

**H.R. 323---Seasoned Customer CTR Exemption Act (Bachus, R-AL)**

**[Order of Business]{.underline}**: The bill is scheduled to be
considered on Tuesday, January 23, 2007, under a motion to suspend the
rules and pass the bill.

**[Summary]{.underline}**: H.R. 323 would direct the Secretary of the
Treasury to promulgate revised rules for allowing financial institutions
to acquire exemptions from filing Currency Transaction Reports (CTR) on
certain transactions by seasoned (i.e. qualified) customers. Currently,
the Bank Secrecy Act requires CTRs to be filed for cash transactions in
excess of \$10,000.

H.R. 323 defines a qualified customer as any individual that:

-   "is incorporated or organized under federal or state law, including
    a sole proprietorship, or is registered and eligible to do business
    within the United States or a state;

-   "has maintained a deposit account with the depository institution
    for at least 12 months; and

-   "has engaged, using such account, in multiple currency transactions
    subject to federal CTR requirements."

The bill would also authorize the Secretary to:

-   "suspend, reject, or revoke any qualified customer exemption notice,
    in accordance with certain criteria; and

-   "establish conditions under which exempt qualified customers of an
    insured depository institution merged with or acquired by another
    insured depository institution will continue to be treated as
    designated exempt qualified customers of the surviving or acquiring
    institution."

H.R. 323 would direct the Secretary to submit to Congress, a three-year
review and report evaluating the operations and effect of the provisions
in this Act and also make recommendations to Congress as to legislative
action with respect to the Act.

The bill lists the following findings:

-   "The completion of and filing of currency transaction reports under
    section 5313 of title 31, United States Code, poses a compliance
    burden on the financial industry;

-   "Due to the nature of the transactions or the persons and entities
    conducting such transactions, some reports as currently filed may
    not be relevant to the detection, deterrence, or investigation of
    financial crimes, including money laundering and the financing of
    terrorism;

-   "However, the data contained in such reports can provide valuable
    context for the analysis of other data derived pursuant to
    subchapter II of chapter 53 of title 31, United States Code, as well
    as investigative data, which provide invaluable and indispensable
    information supporting efforts to combat money laundering and other
    financial crimes;

-   "An appropriate exemption process from the reporting requirements
    for certain currency transactions that are of little or no value to
    ongoing efforts of law enforcement agencies, financial regulatory
    agencies, and the financial services industry to investigate,
    detect, or deter financial crimes would continue to fulfill the
    compelling need to produce and provide meaningful information to
    policy-makers, financial regulators, law enforcement, and
    intelligence agencies, while potentially lowering the compliance
    burden placed on financial institutions by the need to file such
    reports;

-   "The Secretary of the Treasury has by regulation, and in accordance
    with section 5313 of title 31, United States Code, implemented a
    process by which institutions may seek exemptions from filing
    certain currency transaction reports based on appropriate
    circumstances; however, the financial industry has not taken full
    advantage of these provisions and has contended that they are unduly
    burdensome;

-   "The act of providing notice to the Secretary of the Treasury of
    designations of exemption\--

    -   "provides meaningful information to law enforcement officials on
        exempt customers and enables law enforcement to obtain account
        information through appropriate legal process; and

    -   "complements other sections of title 31, United States Code,
        whereby law enforcement can locate financial institutions with
        relevant records relating to a person of investigative interest,
        such as information requests made pursuant to regulations
        implementing section 314(a) of the USA PATRIOT Act of 2001.

-   "A designation of exemption has no effect on requirements for
    depository institutions to apply the full range of anti-money
    laundering controls required under subchapter II of chapter 53 of
    title 31, United States Code, and related provisions of law,
    including the requirement to apply the customer identification
    program pursuant to section 5326 of such title, and the requirement
    to identify, monitor, and, if appropriate, report suspicious
    activity in accordance with section 5318(g) of such title; and

-   "The Federal banking agencies and the Financial Crimes Enforcement
    Network have recently provided guidance through the Federal
    Financial Institutions Examination Council Bank Secrecy
    Act/Anti-Money Laundering Examination Manual on applying appropriate
    levels of due diligence and identifying suspicious activity by the
    types of cash-intensive businesses that generally will be subject to
    exemption."

**[Committee Action]{.underline}**: H.R. 323 was introduced on January
9, 2007, and referred to the Committee on Financial Services, which took
no official action.

**[Cost to Taxpayers]{.underline}**: There is no CBO estimate available
for H.R. 323. However, CBO's estimate of a similar bill last Congress
stated that implementing the bill would have no significant effect on
the budget. The cost for completing the reports is estimated at less
than \$500,000 and would be subject to appropriations. The bill would
not affect direct spending or revenues.

**[Does the Bill Expand the Size and Scope of the Federal
Government?]{.underline}**: No.

**[Does the Bill Contain Any New State-Government, Local-Government, or
Private-Sector Mandates?]{.underline}**: No.

**[Constitutional Authority]{.underline}**: There is no committee report
available for H.R. 323.

**[RSC Staff Contact]{.underline}**: Joelle Cannon;
<joelle.cannon@mail.house.gov>, (202) 226-9717

**H.R. 392---District of Columbia and United States Territories
Circulating Quarter Dollar Program Act *(Delegate Norton, D-DC)***

**[Order of Business]{.underline}**: The bill is scheduled to be
considered on Tuesday, January 23, 2007, under a motion to suspend the
rules and pass the bill.

**[Summary]{.underline}**: H.R. 392 would provide for the issuance in
2009 of circulating quarter-dollar coins that are (separately)
emblematic of the District of Columbia, the Commonwealth of Puerto Rico,
Guam, American Samoa, the United States Virgin Islands, and the
Commonwealth of the Northern Mariana Islands. The coins would have to be
issued in equal sequential intervals during 2009 in the order just
listed. Each of the six designs for quarter-dollars required under this
bill would have to be selected by the Secretary of the Treasury after
consultation with the chief executive (or his or her designee) of the
District of Columbia or the territory being honored and with the
Commission of Fine Arts. The Secretary could not select any "frivolous
or inappropriate" design or a design that includes a head-and-shoulders
portrait or bust of any person, living or dead, or portrait of a living
person. The selected designs would have to be reviewed by the Citizens
Coinage Advisory Committee.

**[RSC Bonus Fact]{.underline}**: The core of a quarter is comprised
entirely of copper, while the coin's face is made of 75 percent copper
and the 25 percent nickel. In addition, if you look closely at the edge
of a quarter, you can see the copper core! (Source:
[www.ustreas.gov/education/](http://www.ustreas.gov/education/))

**[Committee Action]{.underline}**: H.R. 392 was introduced in the House
on January 10, 2007, and referred to the House Committee on Financial
Services, which took no official action.

**[Cost to Taxpayers]{.underline}**: There is no CBO cost estimate
available for H.R. 392. However, previous estimates of similar
legislation stated that the bill would have no net cost.

**[Does the Bill Create New Federal Programs or Rules]{.underline}?**:
The bill would expand the current quarter-dollar program that honors the
50 states to honor the District of Columbia and the U.S. territories as
well.

**[Does the Bill Contain Any New State-Government, Local-Government, or
Private-]{.underline}**

**[Sector Mandates?]{.underline}:** No.

**[Constitutional Authority]{.underline}**: Although, the Financial
Services Committee has not produced a committee report citing
constitutional authority, Article I, Section 8, Clause 5 grants Congress
the power "to coin Money, regulate the Value thereof, and of foreign
Coin...."

**[RSC Staff Contact]{.underline}**: Joelle Cannon;
<joelle.cannon@mail.house.gov>, (202) 226-9717

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