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[Congressional Bills 109th Congress]
[From the U.S. Government Publishing Office]
[S. 14 Introduced in Senate (IS)]

109th CONGRESS
  1st Session
                                 S. 14

To provide fair wages for America's workers, to create new jobs through 
 investment in America, to provide for fair trade and competitiveness, 
                        and for other purposes.

_______________________________________________________________________

                   IN THE SENATE OF THE UNITED STATES

                            January 24, 2005

  Ms. Stabenow (for herself, Mr. Reid, Mr. Corzine, Mr. Kennedy, Mr. 
   Inouye, Ms. Mikulski, Mr. Dorgan, Mr. Leahy, Mr. Rockefeller, Mr. 
  Schumer, Mr. Durbin, and Mr. Dayton) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL

 
To provide fair wages for America's workers, to create new jobs through 
 investment in America, to provide for fair trade and competitiveness, 
                        and for other purposes.

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

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

    (a) Short Title.--This Act may be cited as the ``Fair Wage, 
Competition, and Investment Act of 2005''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents. 
               TITLE I--FAIR WAGES FOR AMERICA'S WORKERS

                 Subtitle A--Overtime Rights Protection

Sec. 111. Short title. 
Sec. 112. Clarification of regulations relating to overtime 
                            compensation. 
                     Subtitle B--Fair Minimum Wage

Sec. 121. Short title. 
Sec. 122. Minimum wage. 
 Subtitle C--Sense of the Senate Regarding Multiemployer Pension Plans

Sec. 131. Sense of the Senate regarding multiemployer pension plans. 
       TITLE II--CREATING NEW JOBS THROUGH INVESTMENT IN AMERICA

           Subtitle A--Eliminating Incentives for Outsourcing

Sec. 211. Taxation of income of controlled foreign corporations 
                            attributable to imported property. 
Sec. 212. Amendments to the Worker Adjustment and Retraining 
                            Notification Act. 
                Subtitle B--Investment in Infrastructure

                Chapter 1--Transportation Infrastructure

Sec. 221. Transportation infrastructure funding. 
                    Chapter 2--Water Infrastructure

Sec. 231. Water infrastructure funding. 
                     Chapter 3--Rail Infrastructure

Sec. 241. Rail infrastructure funding.
Sec. 242. Grant authority.
Sec. 243. Grant conditions for right-of-way projects.
Sec. 244. Use of funds for near-term projects.
Sec. 245. Treatment of rail operators using grant-funded rail 
                            infrastructure.
                   Chapter 4--Transit Infrastructure

Sec. 251. Transit.
                   Chapter 5--Aviation Infrastructure

Sec. 261. Authorization of appropriations.
Sec. 262. Distribution of funds.
Sec. 263. Nonapplicability of certain laws.
Sec. 264. Use of funds for near-term projects.
                 Chapter 6--Broadband Access Tax Credit

Sec. 271. Expensing of broadband Internet access expenditures.
             Chapter 7--Research And Development Tax Credit

Sec. 281. Findings. 
Sec. 282. Permanent extension of research credit. 
Sec. 283. Increase in rates of alternative incremental credit. 
Sec. 284. Alternative simplified credit for qualified research 
                            expenses. 
Sec. 285. Expansion of research credit.
                    Subtitle C--Technology Programs

Sec. 291. Authorizations of appropriations for the Advanced Technology 
                            Program and the Manufacturing Extension 
                            Partnership Program. 
Sec. 292. Sense of the Senate promoting science and technology funding 
                            for a strong economic future. 
               TITLE III--FAIR TRADE AND COMPETITIVENESS

               Subtitle A--Trade Enforcement Enhancement

Sec. 311. Identification of trade expansion priorities.
Sec. 312. Chief enforcement negotiator.
Sec. 313. Foreign debt. 
Sec. 314. Authorization of appropriations.
       Subtitle B--Exchange Rate Policy and Currency Manipulation

Sec. 321. Negotiations regarding currency valuation.
                Subtitle C--Trade Adjustment Assistance

                       Chapter 1--Service Workers

Sec. 331. Short title. 
Sec. 332. Extension of trade adjustment assistance to services sector. 
Sec. 333. Trade adjustment assistance for firms and industries. 
Sec. 334. Monitoring and reporting. 
Sec. 335. Alternative trade adjustment assistance. 
Sec. 336. Effective date. 
         Chapter 2--Trade Adjustment Assistance for Communities

Sec. 341. Short title. 
Sec. 342. Purpose. 
Sec. 343. Trade adjustment assistance for communities. 
Sec. 344. Conforming amendments. 
Sec. 345. Effective date. 
            Chapter 3--Office Of Trade Adjustment Assistance

Sec. 351. Short title. 
Sec. 352. Office of Trade Adjustment Assistance. 
Sec. 353. Effective date. 
Chapter 4--Improvement Of Credit for Health Insurance Costs of Eligible 
                              Individuals

Sec. 361. Improvement of the affordability of the credit. 
Sec. 362. Offering of Federal fallback coverage.
Sec. 363. Clarification of eligibility of spouse of certain individuals 
                            entitled to medicare. 
        Subtitle D--Sense of the Senate on Free Trade Agreements

Sec. 371. Sense of the Senate on free trade agreements. 

               TITLE I--FAIR WAGES FOR AMERICA'S WORKERS

                 Subtitle A--Overtime Rights Protection

SEC. 111. SHORT TITLE.

    This subtitle may be cited as the ``Overtime Rights Protection Act 
of 2005''.

SEC. 112. CLARIFICATION OF REGULATIONS RELATING TO OVERTIME 
              COMPENSATION.

    Section 13 of the Fair Labor Standards Act of 1938 (29 U.S.C. 213) 
is amended by adding at the end the following:
    ``(k)(1) Notwithstanding the provisions of subchapter II of chapter 
5 and chapter 7 of title 5, United States Code (commonly referred to as 
the Administrative Procedures Act) or any other provision of law, any 
portion of the final rule promulgated on April 23, 2004, revising part 
541 of title 29, Code of Federal Regulations, that exempts from the 
overtime pay provision of section 7 of this Act any employee who would 
not otherwise be exempt if the regulations in effect on March 31, 2003, 
remained in effect, shall have no force or effect and that portion of 
such regulations (as in effect on March 31, 2003) that would prevent 
such employee from being exempt shall be reinstated.
    ``(2) The Secretary shall adjust the minimum salary level for 
exemption under section 13(a)(1) in the following manner:
            ``(A) Not later than 60 days after the date of enactment of 
        this subsection, the Secretary shall increase the minimum 
        salary level for exemption under subsection (a)(1) for 
        executive, administrative, and managerial occupations from the 
        level of $155 per week in 1975 to $591 per week (an amount 
        equal to the increase in the Employment Cost Index (published 
        by the Bureau of Labor Statistics) for executive, 
        administrative, and managerial occupations between 1975 and 
        2005).
            ``(B) Not later than December 31 of the calendar year 
        following the increase required in subparagraph (A), and each 
        December 31 thereafter, the Secretary shall increase the 
        minimum salary level for exemption under subsection (a)(1) by 
        an amount equal to the increase in the Employment Cost Index 
        for executive, administrative, and managerial occupations for 
        the year involved.''.

                     Subtitle B--Fair Minimum Wage

SEC. 121. SHORT TITLE.

    This subtitle may be cited as the ``Fair Minimum Wage Act of 
2005''.

SEC. 122. MINIMUM WAGE.

    (a) In General.--Section 6(a)(1) of the Fair Labor Standards Act of 
1938 (29 U.S.C. 206(a)(1)) is amended to read as follows:
            ``(1) except as otherwise provided in this section, not 
        less than--
                    ``(A) $5.85 an hour, beginning on the 60th day 
                after the date of enactment of the Fair Minimum Wage 
                Act of 2005;
                    ``(B) $6.55 an hour, beginning 12 months after that 
                60th day; and
                    ``(C) $7.25 an hour, beginning 24 months after that 
                60th day;''.
    (b) Effective Date.--The amendment made by subsection (a) shall 
take effect 60 days after the date of enactment of this Act.

 Subtitle C--Sense of the Senate Regarding Multiemployer Pension Plans

SEC. 131. SENSE OF THE SENATE REGARDING MULTIEMPLOYER PENSION PLANS.

    (a) Findings.--The Senate makes the following findings:
            (1) Multiemployer pension plans have been a major force in 
        the delivery of employee benefits to active and retired 
        American workers and their dependents for over half a century.
            (2) There are approximately 1,700 multiemployer defined 
        benefit pension plans in which approximately 9,700,000 workers 
        and retirees participate.
            (3) Three-quarters of the approximately 60,000 to 65,000 
        employers that participate in multiemployer plans have fewer 
        that 100 employees.
            (4) Multiemployer plans allow for greater access and 
        affordability for smaller employers and pension portability for 
        their employees as they move from one job to another, and 
        permit workers to earn a pension where they might otherwise not 
        be able to do so.
            (5) The 2000-2002 drop in the stock market and decline in 
        equity values has affected all investors, including 
        multiemployer plans.
            (6) The decline in value sustained by multiemployer defined 
        benefit pension plans have threatened the stability of this 
        private sector source of secure retirement income.
            (7) Participating employers could face onerous excise taxes 
        and other penalties as a result of the serious, adverse 
        financial impact due to these market losses.
            (8) In 2004, the United States Senate recognized the 
        severity of this situation and passed by an overwhelmingly, 
        large bipartisan margin of 86 to 9 temporary relief provisions 
        for single and multiemployer defined benefit pension plans.
    (b) Sense of the Senate.--It is the sense of the Senate that the 
Senate--
            (1) expresses its strong support for multiemployer defined 
        benefit pension plans;
            (2) recognizes the importance of an environment in which 
        multiemployer plans can continue their vital role in providing 
        benefits to working men and women;
            (3) recognizes that multiemployer pension plan relief must 
        be designed for the multiemployer labor-relations environment 
        that supports the plans; and
            (4) supports legislation to strengthen and protect the 
        viability of multiemployer pension plans for the continued 
        benefit of current and retired members, and their families and 
        survivors, and to strengthen the ability of all plans to 
        address funding problems that occur.

       TITLE II--CREATING NEW JOBS THROUGH INVESTMENT IN AMERICA

           Subtitle A--Eliminating Incentives for Outsourcing

SEC. 211. TAXATION OF INCOME OF CONTROLLED FOREIGN CORPORATIONS 
              ATTRIBUTABLE TO IMPORTED PROPERTY.

    (a) General Rule.--Subsection (a) of section 954 of the Internal 
Revenue Code of 1986 (defining foreign base company income) is amended 
by striking ``and'' at the end of paragraph (4), by striking the period 
at the end of paragraph (5) and inserting ``, and'', and by adding at 
the end the following new paragraph:
            ``(6) imported property income for the taxable year 
        (determined under subsection (j) and reduced as provided in 
        subsection (b)(5)).''.
    (b) Definition of Imported Property Income.--Section 954 of the 
Internal Revenue Code of 1986 is amended by adding at the end the 
following new subsection:
    ``(j) Imported Property Income.--
            ``(1) In general.--For purposes of subsection (a)(6), the 
        term `imported property income' means income (whether in the 
        form of profits, commissions, fees, or otherwise) derived in 
        connection with--
                    ``(A) manufacturing, producing, growing, or 
                extracting imported property;
                    ``(B) the sale, exchange, or other disposition of 
                imported property; or
                    ``(C) the lease, rental, or licensing of imported 
                property.
        Such term shall not include any foreign oil and gas extraction 
        income (within the meaning of section 907(c)) or any foreign 
        oil related income (within the meaning of section 907(c)).
            ``(2) Imported property.--For purposes of this subsection--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, the term `imported property' means 
                property which is imported into the United States by 
                the controlled foreign corporation or a related person.
                    ``(B) Imported property includes certain property 
                imported by unrelated persons.--The term `imported 
                property' includes any property imported into the 
                United States by an unrelated person if, when such 
                property was sold to the unrelated person by the 
                controlled foreign corporation (or a related person), 
                it was reasonable to expect that--
                            ``(i) such property would be imported into 
                        the United States; or
                            ``(ii) such property would be used as a 
                        component in other property which would be 
                        imported into the United States.
                    ``(C) Exception for property subsequently 
                exported.--The term `imported property' does not 
                include any property which is imported into the United 
                States and which--
                            ``(i) before substantial use in the United 
                        States, is sold, leased, or rented by the 
                        controlled foreign corporation or a related 
                        person for direct use, consumption, or 
                        disposition outside the United States; or
                            ``(ii) is used by the controlled foreign 
                        corporation or a related person as a component 
                        in other property which is so sold, leased, or 
                        rented.
            ``(3) Definitions and special rules.--
                    ``(A) Import.--For purposes of this subsection, the 
                term `import' means entering, or withdrawal from 
                warehouse, for consumption or use. Such term includes 
                any grant of the right to use intangible property (as 
                defined in section 936(h)(3)(B)) in the United States.
                    ``(B) United states.--For purposes of this 
                subsection, the term `United States' includes the 
                Commonwealth of Puerto Rico, the Virgin Islands of the 
                United States, Guam, American Samoa, and the 
                Commonwealth of the Northern Mariana Islands.
                    ``(C) Unrelated person.--For purposes of this 
                subsection, the term `unrelated person' means any 
                person who is not a related person with respect to the 
                controlled foreign corporation.
                    ``(D) Coordination with foreign base company sales 
                income.--For purposes of this section, the term 
                `foreign base company sales income' shall not include 
                any imported property income.''.
    (c) Separate Application of Limitations on Foreign Tax Credit for 
Imported Property Income.--
            (1) Before 2007.--
                    (A) In general.--Paragraph (1) of section 904(d) of 
                the Internal Revenue Code of 1986 (relating to separate 
                application of section with respect to certain 
                categories of income), as in effect for taxable years 
                beginning before January 1, 2007, is amended by 
                striking ``and'' at the end of subparagraph (H), by 
                redesignating subparagraph (I) as subparagraph (J), and 
                by inserting after subparagraph (H) the following new 
                subparagraph:
                    ``(I) imported property income, and''.
                    (B) Imported property income defined.--Paragraph 
                (2) of section 904(d) of such Code, as so in effect, is 
                amended by redesignating subparagraphs (H) and (I) as 
                subparagraphs (I) and (J), respectively, and by 
                inserting after subparagraph (G) the following new 
                subparagraph:
                    ``(H) Imported property income.--The term `imported 
                property income' means any income received or accrued 
                by any person which is of a kind which would be 
                imported property income (as defined in section 
                954(j)).''.
                    (C) Look-thru rules to apply.--Subparagraph (F) of 
                section 904(d)(3) of such Code, as so in effect, is 
                amended by striking ``or (D)'' and inserting ``(D), or 
                (I)''.
            (2) After 2006.--
                    (A) In general.--Paragraph (1) of section 904(d) of 
                such Code (relating to separate application of section 
                with respect to certain categories of income), as in 
                effect for taxable years beginning after December 31, 
                2006, is amended by striking ``and'' at the end of 
                subparagraph (A), by redesignating subparagraph (B) as 
                subparagraph (C), and by inserting after subparagraph 
                (A) the following new subparagraph:
                    ``(B) imported property income, and''.
                    (B) Imported property income defined.--Paragraph 
                (2) of section 904(d) of such Code, as so in effect, is 
                amended by redesignating subparagraphs (I) and (J) as 
                subparagraphs (J) and (K), respectively, and by 
                inserting after subparagraph (H) the following new 
                subparagraph:
                    ``(I) Imported property income.--The term `imported 
                property income' means any income received or accrued 
                by any person which is of a kind which would be 
                imported property income (as defined in section 
                954(j)).''.
                    (C) Conforming amendment.--Clause (ii) of section 
                904(d)(2)(A) of such Code, as so in effect, is amended 
                by inserting ``or imported property income'' after 
                ``passive category income''.
    (d) Technical Amendments.--
            (1) Clause (iii) of section 952(c)(1)(B) of the Internal 
        Revenue Code of 1986 (relating to certain prior year deficits 
        may be taken into account) is amended--
                    (A) by redesignating subclauses (II), (III), (IV), 
                and (V) as subclauses (III), (IV), (V), and (VI), and
                    (B) by inserting after subclause (I) the following 
                new subclause:
                                    ``(II) imported property income,''.
            (2) Paragraph (5) of section 954(b) of such Code (relating 
        to deductions to be taken into account) is amended by striking 
        ``and the foreign base company oil related income'' and 
        inserting ``the foreign base company oil related income, and 
        the imported property income''.
    (e) Effective Dates.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years of 
        foreign corporations beginning after the date of the enactment 
        of this Act, and to taxable years of United States shareholders 
        within which or with which such taxable years of such foreign 
        corporations end.
            (2) Subsection (c).--The amendments made by subsection 
        (c)(1) shall apply to taxable years beginning after the date of 
        the enactment of this Act and before January 1, 2007, and the 
        amendments made by subsection (c)(2) shall apply to taxable 
        years beginning after December 31, 2006.

SEC. 212. AMENDMENTS TO THE WORKER ADJUSTMENT AND RETRAINING 
              NOTIFICATION ACT.

    (a) Definition.--Section 2(a) of the Worker Adjustment and 
Retraining Notification Act (29 U.S.C. 2101(a)) is amended--
            (1) in paragraph (3)(B), by striking ``for--'' and all that 
        follows through ``500 employees'' in clause (ii), and inserting 
        ``for not less than 50 employees'';
            (2) in paragraph (7), by striking ``and'' after the 
        semicolon;
            (3) in paragraph (8), by striking the period and inserting 
        ``; and''; and
            (4) by adding at the end the following:
            ``(9) the term `offshoring of jobs' means any action taken 
        by an employer the effect of which is to create, shift, or 
        transfer employment positions or facilities outside the United 
        States and which results in an employment loss during any 30-
        day period for 15 or more employees.''.
    (b) Notice.--Section 3 of the Worker Adjustment and Retraining 
Notification Act (29 U.S.C. 2102) is amended--
            (1) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``60-day'' and inserting ``90-day'';
                    (B) in paragraph (1), by striking ``and'' after the 
                semicolon;
                    (C) in paragraph (2), by striking the period and 
                inserting ``; and''; and
                    (D) by inserting after paragraph (2), the 
                following:
            ``(3) to the Secretary of Labor.'';
            (2) in subsection (b), by striking ``60-day'' both places 
        that such term appears and inserting ``90-day''; and
            (3) by adding at the end the following:
    ``(e) Notice for Offshoring of Jobs.--In the case of a notice under 
subsection (a) regarding the offshoring of jobs, the notice shall 
include, in addition to the information otherwise required by the 
Secretary with respect to other notices under such subsection, 
information concerning--
            ``(1) the number of jobs affected;
            ``(2) the location that the jobs are being shifted or 
        transferred to; and
            ``(3) the reasons that such shifting or transferring of 
        jobs is occurring.''.
    (c) Technical Amendments.--The Worker Adjustment and Retraining 
Notification Act (29 U.S.C. 2101 et seq.) is amended--
            (1) by striking ``plant closing or mass layoff'' each place 
        that such term appears and inserting ``plant closing, mass 
        layoff, or offshoring of jobs'';
            (2) by striking ``closing or layoff'' each place that such 
        term appears and inserting ``closing, layoff, or offshoring'';
            (3) in section 3--
                    (A) in the section heading by striking ``plant 
                closings and mass layoffs'' and inserting ``plant 
                closings, mass layoffs, and offshoring of jobs'';
                    (B) in subsection (b)(2)(A), by striking ``the 
                closing or mass layoff'' and inserting ``the closing, 
                layoff, or offshoring''; and
                    (C) in subsection (d), by striking ``section 2(a) 
                (2) or (3)'' and inserting ``paragraph (2), (3), or (9) 
                of section 2(a)''; and
            (4) in section 5(a)(1), in the matter following 
        subparagraph (B), by striking ``60 days'' and inserting ``90 
        days''.
    (d) Posting of Employee Rights.--The Worker Adjustment and 
Retraining Notification Act (29 U.S.C. 2101 et seq.) is amended by 
adding at the end the following:

``SEC. 12. POSTING OF NOTICE OF RIGHTS.

    ``(a) Development.--Not later than 60 days after the date of 
enactment of this section, the Secretary of Labor shall develop a 
notice of employee rights under this Act for posting by employers.
    ``(b) Posting.--Each employer shall post in a conspicuous place in 
places of employment the notice of the rights of employees as developed 
by the Secretary under subsection (a).''.
    (e) Annual Report.--The Worker Adjustment and Retraining 
Notification Act (29 U.S.C. 2101 et seq.), as amended by subsection 
(d), is further amended by adding at the end the following:

``SEC. 13. CONTENTS OF ANNUAL REPORTS BY THE SECRETARY OF LABOR.

    ``(a) In General.--The Secretary of Labor shall collect and compile 
statistics based on the information submitted to the Secretary under 
subsections (a)(3) and (e) of section 3.
    ``(b) Report.--Not later than 120 days after the date on which each 
regular session of Congress commences, the Secretary of Labor shall 
prepare and submit to the President and the appropriate committees of 
Congress a report on the offshoring of jobs (as defined in section 
2(a)(9)). Each such report shall include information concerning--
            ``(1) the number of jobs affected by offshoring;
            ``(2) the locations to which jobs are being shifted or 
        transferred;
            ``(3) the reasons why such shifts and transfers are 
        occurring; and
            ``(4) any other relevant data compiled under subsection 
        (a).''.

                Subtitle B--Investment in Infrastructure

                CHAPTER 1--TRANSPORTATION INFRASTRUCTURE

SEC. 221. TRANSPORTATION INFRASTRUCTURE FUNDING.

    (a) Funding.--
            (1) Authorization of appropriations.--There is authorized 
        to be appropriated to carry out this chapter for each of fiscal 
        years 2005 and 2006 $7,000,000,000, to remain available until 
        expended.
            (2) Distribution.--The Secretary of Transportation, acting 
        through the Administrator of the Federal Highway 
        Administration, shall distribute funds made available under 
        this subsection to States in accordance with section 105 of 
        title 23, United States Code.
    (b) Additional Requirements.--
            (1) Nonapplicability of certain provisions.--Funds made 
        available under this section shall not be subject to--
                    (A) section 120 of title 23, United States Code; or
                    (B) any limitation on obligations under any other 
                provision of law.
            (2) Use of funds for near-term projects.--The Secretary of 
        Transportation shall ensure, to the maximum extent practicable, 
        that funds made available under this section are directed to 
        projects that may be obligated in the near term, as determined 
        by the Secretary of Transportation.

                    CHAPTER 2--WATER INFRASTRUCTURE

SEC. 231. WATER INFRASTRUCTURE FUNDING.

    (a) Authorization of Appropriations.--There is authorized to be 
appropriated to the Administrator of the Environmental Protection 
Agency to make grants to States under--
            (1) title VI of the Federal Water Pollution Control Act (33 
        U.S.C. 1381 et seq.), $3,000,000,000 for each of fiscal years 
        2005 and 2006; and
            (2) section 1452 of the Safe Drinking Water Act (42 U.S.C. 
        300j-12), $3,000,000,000 for each of fiscal years 2005 and 
        2006.
    (b) Availability of Funds.--Funds transferred under subsection (a) 
shall remain available until expended.

                     CHAPTER 3--RAIL INFRASTRUCTURE

SEC. 241. RAIL INFRASTRUCTURE FUNDING.

    (a) Amount for Capital Projects Grants.--There is authorized to be 
appropriated to the Secretary of Transportation for each of fiscal 
years 2005 and 2006, $1,500,000,000, which shall be available for the 
Secretary of Transportation to make grants to States, rail carriers, 
and other entities as determined by the Secretary of Transportation for 
intercity passenger and freight railroad capital projects in accordance 
with this chapter.
    (b) Availability of Funds.--Funds transferred under subsection (a) 
shall remain available until expended.
    (c) Nonapplicability of Certain Provisions.--Funds made available 
under this chapter shall not be subject to any limitation on 
obligations under any other provision of law.

SEC. 242. GRANT AUTHORITY.

    (a) Public Benefit Projects.--The Secretary of Transportation shall 
make grants to States, rail carriers, and other entities, as determined 
by the Secretary, for intercity passenger and freight railroad capital 
projects that provide a public benefit, including projects involving 
the following purposes:
            (1) Track and track structure rehabilitation, relocation, 
        improvement, and development.
            (2) Railroad safety and security improvements.
            (3) Communications and signaling improvements.
            (4) Intercity passenger rail equipment acquisition.
            (5) Rail station and intermodal facilities development.
    (b) Public Benefit Defined.--In this section, the term ``public 
benefit'' means a benefit accrued to the public in the form of enhanced 
mobility of people or goods, environmental protection or enhancement, 
congestion mitigation, enhanced trade and economic development, 
improved air quality or land use, more efficient energy use, enhanced 
public safety or security, reduction of public expenditures due to 
improved transportation efficiency or infrastructure preservation, and 
any other positive community effects (as defined by the Secretary after 
any consultation with State official and rail carriers that the 
Secretary determines appropriate).

SEC. 243. GRANT CONDITIONS FOR RIGHT-OF-WAY PROJECTS.

    The Secretary of Transportation shall require as a condition of 
making any grant under this chapter that includes the improvement or 
use of rights-of-way owned by a railroad that--
            (1) a written agreement exist between the applicant and the 
        railroad regarding such use and ownership, including--
                    (A) any compensation for such use;
                    (B) assurances regarding the adequacy of 
                infrastructure capacity to accommodate both existing 
                and future freight and passenger operations; and
                    (C) an assurance by the railroad that collective 
                bargaining agreements with the railroad's employees 
                (including terms regulating the contracting of work) 
                will remain in full force and effect according to their 
                terms for work performed by the railroad on the 
                railroad transportation corridor; and
            (2) the applicant agrees to comply with--
                    (A) the standards under section 24312 of title 49, 
                United States Code, as such section was in effect on 
                September 1, 2003, with respect to the project in the 
                same manner that the National Railroad Passenger 
                Corporation is required to comply with those standards 
                for construction work financed under an agreement made 
                under section; and
                    (B) the protective agreements established under 
                section 504 of the Railroad Revitalization and 
                Regulatory Reform Act of 1976 with respect to employees 
                affected by actions taken in connection with the 
                project.

SEC. 244. USE OF FUNDS FOR NEAR-TERM PROJECTS.

    The Secretary of Transportation shall ensure, to the maximum extent 
practicable, that funds made available under this chapter are directed 
to projects that may be obligated in the near term, as determined by 
the Secretary of Transportation.

SEC. 245. TREATMENT OF RAIL OPERATORS USING GRANT-FUNDED RAIL 
              INFRASTRUCTURE.

    A person that conducts rail operations over rail infrastructure 
constructed or improved with funding provided in whole or in part in a 
grant made under this chapter--
            (1) shall be considered an employer for purposes of the 
        Railroad Retirement Act of 1974 (45 20 U.S.C. 231 et seq.); and
            (2) shall be considered a carrier for purposes of the 
        Railway Labor Act (43 U.S.C. 151 et seq.) unless such a person 
        is an operator with respect to commuter rail passenger 
        transportation (as defined in section 24102(4) of title 49, 
        United States Code) of a State or local government authority 
        (as such terms are defined in section 5302 of such title) 
        eligible to receive financial assistance under section 5307 of 
        such title, a contractor performing services in connection with 
        the operations with respect to commuter rail passenger 
        transportation (as so defined), or the Alaska Railroad or its 
        contractors.

                   CHAPTER 4--TRANSIT INFRASTRUCTURE

SEC. 251. TRANSIT.

    (a) Authorization of Appropriations.--
            (1) Amounts for fiscal years 2005 and 2006.--There is 
        authorized to be appropriated to the Secretary of 
        Transportation for each of the fiscal years 2005 and 2006, 
        $1,750,000,000.
            (2) Availability of funds.--Funds appropriated under 
        paragraph (1) shall remain available until expended.
    (b) Distribution of Funds.--
            (1) In general.--Of the funds authorized to be appropriated 
        under subsection (a)--
                    (A) 50.18 percent shall be available to carry out 
                section 5307 of title 49, United States Code;
                    (B) 45 percent shall be available to carry out 
                section 5309(a)(1) of title 49, United States Code, of 
                which--
                            (i) 40 percent shall be available to carry 
                        out subparagraph (A) of such paragraph;
                            (ii) 40 percent shall be available to carry 
                        out subparagraph (E) of such paragraph; and
                            (iii) 20 percent shall be available to 
                        carry out subparagraph (F) of such paragraph;
                    (C) 1.32 percent shall be available to carry out 
                section 5310 of title 49, United States Code; and
                    (D) 3.5 percent shall be available to carry out 
                section 5311 of title 49, United States Code.
            (2) Formulas.--Funds made available under subparagraphs 
        (A), (C), and (D) of paragraph (1) shall be distributed in 
        accordance with the formulas established under sections 5307, 
        5310, and 5311, respectively, of title 49, United States Code.
            (3) Determination by secretary.--
                    (A) In general.--The Secretary of Transportation 
                shall determine the allocation of funds made available 
                under clauses (i) and (iii) of paragraph (1)(B).
                    (B) Modernization of existing fixed guideway 
                systems.--The Secretary of Transportation shall 
                determine the amount apportioned to each urbanized area 
                under paragraph (1)(B)(ii) on a pro rata basis in 
                accordance with the distribution formula established 
                under section 5337 of title 49, United States Code.
                    (C) Near term projects.--In allocating funds under 
                this paragraph, the Secretary of Transportation shall 
                ensure, to the maximum extent practicable, that funds 
                are directed to near term projects.
    (c) Limitation for Capital Projects.--Funds may be used under this 
section only for capital projects.
    (d) Inapplicability of Certain Provisions.--Funds distributed under 
subsection (b) shall not be subject to sections 5307(e), 5309(h), or 
5311(g) of title 49, United States Code.

                   CHAPTER 5--AVIATION INFRASTRUCTURE

SEC. 261. AUTHORIZATION OF APPROPRIATIONS FOR AVIATION INFRASTRUCTURE.

    There is authorized to be appropriated for each of fiscal years 
2005 and 2006 to carry out this chapter, $1,500,000,000, to remain 
available until expended.

SEC. 262. DISTRIBUTION OF FUNDS.

    The Secretary of Transportation, acting through the Administrator 
of the Federal Aviation Administration, shall distribute funds made 
available under this chapter to public use airports for the purposes 
provided under chapter 471 of title 49, United States Code, including 
for enhancement of aviation safety, enhancement of aviation capacity, 
and defrayal of the cost of security requirements imposed on airport 
operators by the Administrator or by the Administrator of the 
Transportation Security Administration.

SEC. 263. NONAPPLICABILITY OF CERTAIN LAWS.

    Funds made available under this chapter shall not be subject to--
            (1) a matching requirement under section 47109 of title 49, 
        United States Code; or
            (2) any limitation on obligation under any other provision 
        of law.

SEC. 264. USE OF FUNDS FOR NEAR-TERM PROJECTS.

    The Secretary of Transportation shall ensure, to the maximum extent 
practicable, that funds made available under this chapter are directed 
to projects that may be obligated in the near-term, as determined by 
the Secretary of Transportation.

                 CHAPTER 6--BROADBAND ACCESS TAX CREDIT

SEC. 271. EXPENSING OF BROADBAND INTERNET ACCESS EXPENDITURES.

    (a) In General.--Part VI of subchapter B of chapter 1 of the 
Internal Revenue Code of 1986 (relating to itemized deductions for 
individuals and corporations) is amended by inserting after section 190 
the following new section:

``SEC. 191. BROADBAND EXPENDITURES.

    ``(a) Treatment of Expenditures.--
            ``(1) In general.--A taxpayer may elect to treat any 
        qualified broadband expenditure which is paid or incurred by 
        the taxpayer as an expense which is not chargeable to capital 
        account. Any expenditure which is so treated shall be allowed 
        as a deduction.
            ``(2) Election.--An election under paragraph (1) shall be 
        made at such time and in such manner as the Secretary may 
        prescribe by regulation.
    ``(b) Qualified Broadband Expenditures.--For purposes of this 
section--
            ``(1) In general.--The term `qualified broadband 
        expenditure' means, with respect to any taxable year, any 
        direct or indirect costs incurred and properly taken into 
        account with respect to--
                    ``(A) the purchase or installation of qualified 
                equipment (including any upgrades thereto), and
                    ``(B) the connection of such qualified equipment to 
                any qualified subscriber.
            ``(2) Certain satellite expenditures excluded.--Such term 
        shall not include any costs incurred with respect to the 
        launching of any satellite equipment.
            ``(3) Leased equipment.--Such term shall include so much of 
        the purchase price paid by the lessor of qualified equipment 
        subject to a lease described in subsection (c)(2)(B) as is 
        attributable to expenditures incurred by the lessee which would 
        otherwise be described in paragraph (1).
            ``(4) Limitation with regard to current generation 
        broadband services.--Only 50 percent of the amounts taken into 
        account under paragraph (1) with respect to qualified equipment 
        through which current generation broadband services are 
        provided shall be treated as qualified broadband expenditures.
    ``(c) When Expenditures Taken Into Account.--For purposes of this 
section--
            ``(1) In general.--Qualified broadband expenditures with 
        respect to qualified equipment shall be taken into account with 
        respect to the first taxable year in which--
                    ``(A) current generation broadband services are 
                provided through such equipment to qualified 
                subscribers, or
                    ``(B) next generation broadband services are 
                provided through such equipment to qualified 
                subscribers.
            ``(2) Limitation.--
                    ``(A) In general.--Qualified expenditures shall be 
                taken into account under paragraph (1) only with 
                respect to qualified equipment--
                            ``(i) the original use of which commences 
                        with the taxpayer, and
                            ``(ii) which is placed in service, after 
                        the date of the enactment of this Act.
                    ``(B) Sale-leasebacks.--For purposes of 
                subparagraph (A), if property--
                            ``(i) is originally placed in service after 
                        the date of the enactment of this Act by any 
                        person, and
                            ``(ii) sold and leased back by such person 
                        within 3 months after the date such property 
                        was originally placed in service,
                such property shall be treated as originally placed in 
                service not earlier than the date on which such 
                property is used under the leaseback referred to in 
                clause (ii).
    ``(d) Special Allocation Rules.--
            ``(1) Current generation broadband services.--For purposes 
        of determining the amount of qualified broadband expenditures 
        under subsection (a)(1) with respect to qualified equipment 
        through which current generation broadband services are 
        provided, if the qualified equipment is capable of serving both 
        qualified subscribers and other subscribers, the qualified 
        broadband expenditures shall be multiplied by a fraction--
                    ``(A) the numerator of which is the sum of the 
                number of potential qualified subscribers within the 
                rural areas and the underserved areas which the 
                equipment is capable of serving with current generation 
                broadband services, and
                    ``(B) the denominator of which is the total 
                potential subscriber population of the area which the 
                equipment is capable of serving with current generation 
                broadband services.
            ``(2) Next generation broadband services.--For purposes of 
        determining the amount of qualified broadband expenditures 
        under subsection (a)(1) with respect to qualified equipment 
        through which next generation broadband services are provided, 
        if the qualified equipment is capable of serving both qualified 
        subscribers and other subscribers, the qualified expenditures 
        shall be multiplied by a fraction--
                    ``(A) the numerator of which is the sum of--
                            ``(i) the number of potential qualified 
                        subscribers within the rural areas and 
                        underserved areas, plus
                            ``(ii) the number of potential qualified 
                        subscribers within the area consisting only of 
                        residential subscribers not described in clause 
                        (i),
                which the equipment is capable of serving with next 
                generation broadband services, and
                    ``(B) the denominator of which is the total 
                potential subscriber population of the area which the 
                equipment is capable of serving with next generation 
                broadband services.
    ``(e) Definitions.--For purposes of this section--
            ``(1) Antenna.--The term `antenna' means any device used to 
        transmit or receive signals through the electromagnetic 
        spectrum, including satellite equipment.
            ``(2) Cable operator.--The term `cable operator' has the 
        meaning given such term by section 602(5) of the Communications 
        Act of 1934 (47 U.S.C. 522(5)).
            ``(3) Commercial mobile service carrier.--The term 
        `commercial mobile service carrier' means any person authorized 
        to provide commercial mobile radio service as defined in 
        section 20.3 of title 47, Code of Federal Regulations.
            ``(4) Current generation broadband service.--The term 
        `current generation broadband service' means the transmission 
        of signals at a rate of at least 1,000,000 bits per second to 
        the subscriber and at least 128,000 bits per second from the 
        subscriber.
            ``(5) Multiplexing or demultiplexing.--The term 
        `multiplexing' means the transmission of 2 or more signals over 
        a single channel, and the term `demultiplexing' means the 
        separation of 2 or more signals previously combined by 
        compatible multiplexing equipment.
            ``(6) Next generation broadband service.--The term `next 
        generation broadband service' means the transmission of signals 
        at a rate of at least 22,000,000 bits per second to the 
        subscriber and at least 5,000,000 bits per second from the 
        subscriber.
            ``(7) Nonresidential subscriber.--The term `nonresidential 
        subscriber' means any person who purchases broadband services 
        which are delivered to the permanent place of business of such 
        person.
            ``(8) Open video system operator.--The term `open video 
        system operator' means any person authorized to provide service 
        under section 653 of the Communications Act of 1934 (47 U.S.C. 
        573).
            ``(9) Other wireless carrier.--The term `other wireless 
        carrier' means any person (other than a telecommunications 
        carrier, commercial mobile service carrier, cable operator, 
        open video system operator, or satellite carrier) providing 
        current generation broadband services or next generation 
        broadband service to subscribers through the radio transmission 
        of energy.
            ``(10) Packet switching.--The term `packet switching' means 
        controlling or routing the path of any digitized transmission 
        signal which is assembled into packets or cells.
            ``(11) Provider.--The term `provider' means, with respect 
        to any qualified equipment--
                    ``(A) a cable operator,
                    ``(B) a commercial mobile service carrier,
                    ``(C) an open video system operator,
                    ``(D) a satellite carrier,
                    ``(E) a telecommunications carrier, or
                    ``(F) any other wireless carrier,
        providing current generation broadband services or next 
        generation broadband services to subscribers through such 
        qualified equipment.
            ``(12) Provision of services.--A provider shall be treated 
        as providing services to 1 or more subscribers if--
                    ``(A) such a subscriber has been passed by the 
                provider's equipment and can be connected to such 
                equipment for a standard connection fee,
                    ``(B) the provider is physically able to deliver 
                current generation broadband services or next 
                generation broadband services, as applicable, to such a 
                subscriber without making more than an insignificant 
                investment with respect to such subscriber,
                    ``(C) the provider has made reasonable efforts to 
                make such subscribers aware of the availability of such 
                services,
                    ``(D) such services have been purchased by 1 or 
                more such subscribers, and
                    ``(E) such services are made available to such 
                subscribers at average prices comparable to those at 
                which the provider makes available similar services in 
                any areas in which the provider makes available such 
                services.
            ``(13) Qualified equipment.--
                    ``(A) In general.--The term `qualified equipment' 
                means equipment which provides current generation 
                broadband services or next generation broadband 
                services--
                            ``(i) at least a majority of the time 
                        during periods of maximum demand to each 
                        subscriber who is utilizing such services, and
                            ``(ii) in a manner substantially the same 
                        as such services are provided by the provider 
                        to subscribers through equipment with respect 
                        to which no deduction is allowed under 
                        subsection (a)(1).
                    ``(B) Only certain investment taken into account.--
                Except as provided in subparagraph (C) or (D), 
                equipment shall be taken into account under 
                subparagraph (A) only to the extent it--
                            ``(i) extends from the last point of 
                        switching to the outside of the unit, building, 
                        dwelling, or office owned or leased by a 
                        subscriber in the case of a telecommunications 
                        carrier,
                            ``(ii) extends from the customer side of 
                        the mobile telephone switching office to a 
                        transmission/receive antenna (including such 
                        antenna) owned or leased by a subscriber in the 
                        case of a commercial mobile service carrier,
                            ``(iii) extends from the customer side of 
                        the headend to the outside of the unit, 
                        building, dwelling, or office owned or leased 
                        by a subscriber in the case of a cable operator 
                        or open video system operator, or
                            ``(iv) extends from a transmission/receive 
                        antenna (including such antenna) which 
                        transmits and receives signals to or from 
                        multiple subscribers, to a transmission/receive 
                        antenna (including such antenna) on the outside 
                        of the unit, building, dwelling, or office 
                        owned or leased by a subscriber in the case of 
                        a satellite carrier or other wireless carrier, 
                        unless such other wireless carrier is also a 
                        telecommunications carrier.
                    ``(C) Packet switching equipment.--Packet switching 
                equipment, regardless of location, shall be taken into 
                account under subparagraph (A) only if it is deployed 
                in connection with equipment described in subparagraph 
                (B) and is uniquely designed to perform the function of 
                packet switching for current generation broadband 
                services or next generation broadband services, but 
                only if such packet switching is the last in a series 
                of such functions performed in the transmission of a 
                signal to a subscriber or the first in a series of such 
                functions performed in the transmission of a signal 
                from a subscriber.
                    ``(D) Multiplexing and demultiplexing equipment.--
                Multiplexing and demultiplexing equipment shall be 
                taken into account under subparagraph (A) only to the 
                extent it is deployed in connection with equipment 
                described in subparagraph (B) and is uniquely designed 
                to perform the function of multiplexing and 
                demultiplexing packets or cells of data and making 
                associated application adaptions, but only if such 
                multiplexing or demultiplexing equipment is located 
                between packet switching equipment described in 
                subparagraph (C) and the subscriber's premises.
            ``(14) Qualified subscriber.--The term `qualified 
        subscriber' means--
                    ``(A) with respect to the provision of current 
                generation broadband services--
                            ``(i) any nonresidential subscriber 
                        maintaining a permanent place of business in a 
                        rural area or underserved area, or
                            ``(ii) any residential subscriber residing 
                        in a dwelling located in a rural area or 
                        underserved area which is not a saturated 
                        market, and
                    ``(B) with respect to the provision of next 
                generation broadband services--
                            ``(i) any nonresidential subscriber 
                        maintaining a permanent place of business in a 
                        rural area or underserved area, or
                            ``(ii) any residential subscriber.
            ``(15) Residential subscriber.--The term `residential 
        subscriber' means any individual who purchases broadband 
        services which are delivered to such individual's dwelling.
            ``(16) Rural area.--The term `rural area' means any census 
        tract which--
                    ``(A) is not within 10 miles of any incorporated or 
                census designated place containing more than 25,000 
                people, and
                    ``(B) is not within a county or county equivalent 
                which has an overall population density of more than 
                500 people per square mile of land.
            ``(17) Rural subscriber.--The term `rural subscriber' means 
        any residential subscriber residing in a dwelling located in a 
        rural area or nonresidential subscriber maintaining a permanent 
        place of business located in a rural area.
            ``(18) Satellite carrier.--The term `satellite carrier' 
        means any person using the facilities of a satellite or 
        satellite service licensed by the Federal Communications 
        Commission and operating in the Fixed-Satellite Service under 
        part 25 of title 47 of the Code of Federal Regulations or the 
        Direct Broadcast Satellite Service under part 100 of title 47 
        of such Code to establish and operate a channel of 
        communications for distribution of signals, and owning or 
        leasing a capacity or service on a satellite in order to 
        provide such point-to-multipoint distribution.
            ``(19) Saturated market.--The term `saturated market' means 
        any census tract in which, as of the date of the enactment of 
        this section--
                    ``(A) current generation broadband services have 
                been provided by a single provider to 85 percent or 
                more of the total number of potential residential 
                subscribers residing in dwellings located within such 
                census tract, and
                    ``(B) such services can be utilized--
                            ``(i) at least a majority of the time 
                        during periods of maximum demand by each such 
                        subscriber who is utilizing such services, and
                            ``(ii) in a manner substantially the same 
                        as such services are provided by the provider 
                        to subscribers through equipment with respect 
                        to which no deduction is allowed under 
                        subsection (a)(1).
            ``(20) Subscriber.--The term `subscriber' means any person 
        who purchases current generation broadband services or next 
        generation broadband services.
            ``(21) Telecommunications carrier.--The term 
        `telecommunications carrier' has the meaning given such term by 
        section 3(44) of the Communications Act of 1934 (47 U.S.C. 
        153(44)), but--
                    ``(A) includes all members of an affiliated group 
                of which a telecommunications carrier is a member, and
                    ``(B) does not include a commercial mobile service 
                carrier.
            ``(22) Total potential subscriber population.--The term 
        `total potential subscriber population' means, with respect to 
        any area and based on the most recent census data, the total 
        number of potential residential subscribers residing in 
        dwellings located in such area and potential nonresidential 
        subscribers maintaining permanent places of business located in 
        such area.
            ``(23) Underserved area.--The term `underserved area' 
        means--
                    ``(A) any census tract which is located in--
                            ``(i) an empowerment zone or enterprise 
                        community designated under section 1391, or
                            ``(ii) the District of Columbia Enterprise 
                        Zone established under section 1400, or
                    ``(B) any census tract--
                            ``(i) the poverty level of which is at 
                        least 30 percent (based on the most recent 
                        census data), and
                            ``(ii) the median family income of which 
                        does not exceed--
                                    ``(I) in the case of a census tract 
                                located in a metropolitan statistical 
                                area, 70 percent of the greater of the 
                                metropolitan area median family income 
                                or the statewide median family income, 
                                and
                                    ``(II) in the case of a census 
                                tract located in a nonmetropolitan 
                                statistical area, 70 percent of the 
                                nonmetropolitan statewide median family 
                                income.
            ``(24) Underserved subscriber.--The term `underserved 
        subscriber' means any residential subscriber residing in a 
        dwelling located in an underserved area or nonresidential 
        subscriber maintaining a permanent place of business located in 
        an underserved area.
    ``(f) Special Rules.--
            ``(1) Property used outside the united states, etc., not 
        qualified.--No expenditures shall be taken into account under 
        subsection (a)(1) with respect to the portion of the cost of 
        any property referred to in section 50(b) or with respect to 
        the portion of the cost of any property specified in an 
        election under section 179.
            ``(2) Basis reduction.--
                    ``(A) In general.--For purposes of this title, the 
                basis of any property shall be reduced by the portion 
                of the cost of such property taken into account under 
                subsection (a)(1).
                    ``(B) Ordinary income recapture.--For purposes of 
                section 1245, the amount of the deduction allowable 
                under subsection (a)(1) with respect to any property 
                which is of a character subject to the allowance for 
                depreciation shall be treated as a deduction allowed 
                for depreciation under section 167.
            ``(3) Coordination with section 38.--No credit shall be 
        allowed under section 38 with respect to any amount for which a 
        deduction is allowed under subsection (a)(1).''.
    (b) Special Rule for Mutual or Cooperative Telephone Companies.--
Section 512(b) of the Internal Revenue Code of 1986 (relating to 
modifications) is amended--
            (1) by redesignating paragraph (18) as added by section 
        702(a) of the American Jobs Creation Act of 2004 as paragraph 
        (19), and
            (2) by adding at the end the following new paragraph:
            ``(20) Special rule for mutual or cooperative telephone 
        companies.--A mutual or cooperative telephone company which for 
        the taxable year satisfies the requirements of section 
        501(c)(12)(A) may elect to reduce its unrelated business 
        taxable income for such year, if any, by an amount that does 
        not exceed the qualified broadband expenditures which would be 
        taken into account under section 191 for such year by such 
        company if such company was not exempt from taxation. Any 
        amount which is allowed as a deduction under this paragraph 
        shall not be allowed as a deduction under section 191 and the 
        basis of any property to which this paragraph applies shall be 
        reduced under section 1016(a)(32).''.
    (c) Conforming Amendments.--
            (1) Section 263(a)(1) of the Internal Revenue Code of 1986 
        (relating to capital expenditures) is amended by striking 
        ``or'' at the end of subparagraph (H), by striking the period 
        at the end of subparagraph (I) and inserting ``, or'', and by 
        adding at the end the following new subparagraph:
                    ``(J) expenditures for which a deduction is allowed 
                under section 191.''.
            (2) Section 1016(a) of such Code is amended by striking 
        ``and'' at the end of paragraph (30), by striking the period at 
        the end of paragraph (31) and inserting ``, and'', and by 
        adding at the end the following new paragraph:
            ``(32) to the extent provided in section 191(f)(2).''.
            (3) The table of sections for part VI of subchapter A of 
        chapter 1 of such Code is amended by inserting after the item 
        relating to section 190 the following new item:

``Sec. 191. Broadband expenditures.''.
    (d) Designation of Census Tracts.--
            (1) In general.--The Secretary of the Treasury shall, not 
        later than 90 days after the date of the enactment of this Act, 
        designate and publish those census tracts meeting the criteria 
        described in paragraphs (16), (22), and (23) of section 191(e) 
        of the Internal Revenue Code of 1986 (as added by this 
        section). In making such designations, the Secretary of the 
        Treasury shall consult with such other departments and agencies 
        as the Secretary determines appropriate.
            (2) Saturated market.--
                    (A) In general.--For purposes of designating and 
                publishing those census tracts meeting the criteria 
                described in subsection (e)(19) of such section 191--
                            (i) the Secretary of the Treasury shall 
                        prescribe not later than 30 days after the date 
                        of the enactment of this Act the form upon 
                        which any provider which takes the position 
                        that it meets such criteria with respect to any 
                        census tract shall submit a list of such census 
                        tracts (and any other information required by 
                        the Secretary) not later than 60 days after the 
                        date of the publication of such form, and
                            (ii) the Secretary of the Treasury shall 
                        publish an aggregate list of such census tracts 
                        and the applicable providers not later than 30 
                        days after the last date such submissions are 
                        allowed under clause (i).
                    (B) No subsequent lists required.--The Secretary of 
                the Treasury shall not be required to publish any list 
                of census tracts meeting such criteria subsequent to 
                the list described in subparagraph (A)(ii).
    (e) Other Regulatory Matters.--
            (1) Prohibition.--No Federal or State agency or 
        instrumentality shall adopt regulations or ratemaking 
        procedures that would have the effect of eliminating or 
        reducing any deduction or portion thereof allowed under section 
        191 of the Internal Revenue Code of 1986 (as added by this 
        section) or otherwise subverting the purpose of this section.
            (2) Treasury regulatory authority.--It is the intent of 
        Congress in providing the election to deduct qualified 
        broadband expenditures under section 191 of the Internal 
        Revenue Code of 1986 (as added by this section) to provide 
        incentives for the purchase, installation, and connection of 
        equipment and facilities offering expanded broadband access to 
        the Internet for users in certain low income and rural areas of 
        the United States, as well as to residential users nationwide, 
        in a manner that maintains competitive neutrality among the 
        various classes of providers of broadband services. 
        Accordingly, the Secretary of the Treasury shall prescribe such 
        regulations as may be necessary or appropriate to carry out the 
        purposes of section 191 of such Code, including--
                    (A) regulations to determine how and when a 
                taxpayer that incurs qualified broadband expenditures 
                satisfies the requirements of section 191 of such Code 
                to provide broadband services, and
                    (B) regulations describing the information, 
                records, and data taxpayers are required to provide the 
                Secretary to substantiate compliance with the 
                requirements of section 191 of such Code.
    (f) Effective Date.--The amendments made by this section shall 
apply to expenditures incurred after the date of the enactment of this 
Act and before the date which is 60 months after the date of the 
enactment of this Act.

             CHAPTER 7--RESEARCH AND DEVELOPMENT TAX CREDIT

SEC. 281. FINDINGS.

    Congress finds the following:
            (1) Research and development performed in the United States 
        results in quality jobs, better and safer products, increased 
        ownership of technology-based intellectual property, and higher 
        productivity in the United States.
            (2) Since 1994, private sector research and development 
        employment has grown at a faster rate than overall private 
        sector employment in the United States. From 1994 to 2000, 
        there was an average annual growth rate of 5.4 percent in 
        research and development employment, compared with 2.7 percent 
        in total employment.
            (3) The extent to which companies perform and increase 
        research and development activities in the United States is in 
        part dependent on Federal tax policy.
            (4) The private sector performed most of the Nation's 
        research and development and accounted for more than two-thirds 
        of total research and development performance in 2003. Of the 
        $194,000,000,000 in industrial research and development 
        performed in 2003, more than 90 percent was funded by industry.
            (5) Many of the countries with which the United States 
        competes have introduced new or revised national plans for 
        science, technology, and innovation policy, and a growing 
        number of countries have established targets for increased 
        research and development spending. Virtually all countries are 
        seeking ways to enhance the quality and efficiency of public 
        research, stimulate business investments in research and 
        development, and strengthen linkages between the public and 
        private sectors.
            (6) Direct government support to business research and 
        development has declined, both in absolute terms and as a share 
        of business research and development, and greater emphasis is 
        being placed on indirect measures, such as tax incentives for 
        research and development.
            (7) Congress should make permanent a research and 
        development credit that provides a meaningful incentive to all 
        types of taxpayers.

SEC. 282. PERMANENT EXTENSION OF RESEARCH CREDIT.

    (a) In General.--Section 41 of the Internal Revenue Code of 1986 
(relating to credit for increasing research activities) is amended by 
striking subsection (h).
    (b) Conforming Amendment.--Paragraph (1) of section 45C(b) of such 
Code is amended by striking subparagraph (D).
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act, in taxable years ending after such date.

SEC. 283. INCREASE IN RATES OF ALTERNATIVE INCREMENTAL CREDIT.

    (a) In General.--Subparagraph (A) of section 41(c)(4) of the 
Internal Revenue Code of 1986 (relating to election of alternative 
incremental credit) is amended--
            (1) by striking ``2.65 percent'' and inserting ``3 
        percent'',
            (2) by striking ``3.2 percent'' and inserting ``4 
        percent'', and
            (3) by striking ``3.75 percent'' and inserting ``5 
        percent''.
    (b) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 284. ALTERNATIVE SIMPLIFIED CREDIT FOR QUALIFIED RESEARCH 
              EXPENSES.

    (a) In General.--Subsection (c) of section 41 of the Internal 
Revenue Code of 1986 (relating to base amount) is amended by 
redesignating paragraphs (5) and (6) as paragraphs (6) and (7), 
respectively, and by inserting after paragraph (4) the following new 
paragraph:
            ``(5) Election of alternative simplified credit.--
                    ``(A) In general.--At the election of the taxpayer, 
                the credit determined under subsection (a)(1) shall be 
                equal to 12 percent of so much of the qualified 
                research expenses for the taxable year as exceeds 50 
                percent of the average qualified research expenses for 
                the 3 taxable years preceding the taxable year for 
                which the credit is being determined.
                    ``(B) Special rule in case of no qualified research 
                expenses in any of 3 preceding taxable years.--
                            ``(i) Taxpayers to which subparagraph 
                        applies.--The credit under this paragraph shall 
                        be determined under this subparagraph if the 
                        taxpayer has no qualified research expenses in 
                        any 1 of the 3 taxable years preceding the 
                        taxable year for which the credit is being 
                        determined.
                            ``(ii) Credit rate.--The credit determined 
                        under this subparagraph shall be equal to 6 
                        percent of the qualified research expenses for 
                        the taxable year.
                    ``(C) Election.--An election under this paragraph 
                shall apply to the taxable year for which made and all 
                succeeding taxable years unless revoked with the 
                consent of the Secretary. An election under this 
                paragraph may not be made for any taxable year to which 
                an election under paragraph (4) applies.''.
    (b) Coordination With Election of Alternative Incremental Credit.--
            (1) In general.--Section 41(c)(4)(B) of the Internal 
        Revenue Code of 1986 (relating to election) is amended by 
        adding at the end the following: ``An election under this 
        paragraph may not be made for any taxable year to which an 
        election under paragraph (5) applies.''.
            (2) Transition rule.--In the case of an election under 
        section 41(c)(4) of the Internal Revenue Code of 1986 which 
        applies to the taxable year which includes the date of the 
        enactment of this Act, such election shall be treated as 
        revoked with the consent of the Secretary of the Treasury if 
        the taxpayer makes an election under section 41(c)(5) of such 
        Code (as added by subsection (a)) for such year.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years ending after the date of the enactment of this 
Act.

SEC. 285. EXPANSION OF RESEARCH CREDIT.

    (a) Credit for Expenses Attributable to Certain Collaborative 
Research Consortia.--
            (1) In general.--Section 41(a) of the Internal Revenue Code 
        of 1986 (relating to credit for increasing research activities) 
        is amended by striking ``and'' at the end of paragraph (1), by 
        striking the period at the end of paragraph (2) and inserting 
        ``, and'', and by adding at the end the following new 
        paragraph:
            ``(3) 20 percent of the amounts paid or incurred by the 
        taxpayer in carrying on any trade or business of the taxpayer 
        during the taxable year (including as contributions) to a 
        research consortium.''.
            (2) Research consortium defined.--Section 41(f) of such 
        Code (relating to special rules) is amended by adding at the 
        end the following new paragraph:
            ``(6) Research consortium.--
                    ``(A) In general.--The term `research consortium' 
                means any organization--
                            ``(i) which is--
                                    ``(I) described in section 
                                501(c)(3) or 501(c)(6) and is exempt 
                                from tax under section 501(a) and is 
                                organized and operated primarily to 
                                conduct research, or
                                    ``(II) organized and operated 
                                primarily to conduct research in the 
                                public interest (within the meaning of 
                                section 501(c)(3)),
                            ``(ii) which is not a private foundation,
                            ``(iii) to which at least 5 unrelated 
                        persons paid or incurred during the calendar 
                        year in which the taxable year of the 
                        organization begins amounts (including as 
                        contributions) to such organization for 
                        research, and
                            ``(iv) to which no single person paid or 
                        incurred (including as contributions) during 
                        such calendar year an amount equal to more than 
                        50 percent of the total amounts received by 
                        such organization during such calendar year for 
                        research.
                    ``(B) Treatment of persons.--All persons treated as 
                a single employer under subsection (a) or (b) of 
                section 52 shall be treated as related persons for 
                purposes of subparagraph (A)(iii) and as a single 
                person for purposes of subparagraph (A)(iv).''.
            (3) Conforming amendment.--Section 41(b)(3)(C)(ii) of such 
        Code is amended by inserting ``(other than a research 
        consortium)'' after ``organization''.
    (b) Repeal of Limitation on Contract Research Expenses Paid to 
Small Businesses, Universities, and Federal Laboratories.--Section 
41(b)(3) of the Internal Revenue Code of 1986 (relating to contract 
research expenses) is amended by adding at the end the following new 
subparagraph:
                    ``(D) Amounts paid to eligible small businesses, 
                universities, and federal laboratories.--
                            ``(i) In general.--In the case of amounts 
                        paid by the taxpayer to--
                                    ``(I) an eligible small business,
                                    ``(II) an institution of higher 
                                education (as defined in section 
                                3304(f)), or
                                    ``(III) an organization which is a 
                                Federal laboratory,
                        for qualified research, subparagraph (A) shall 
                        be applied by substituting `100 percent' for 
                        `65 percent'.
                            ``(ii) Eligible small business.--For 
                        purposes of this subparagraph, the term 
                        `eligible small business' means a small 
                        business with respect to which the taxpayer 
                        does not own (within the meaning of section 
                        318) 50 percent or more of--
                                    ``(I) in the case of a corporation, 
                                the outstanding stock of the 
                                corporation (either by vote or value), 
                                and
                                    ``(II) in the case of a small 
                                business which is not a corporation, 
                                the capital and profits interests of 
                                the small business.
                            ``(iii) Small business.--For purposes of 
                        this subparagraph--
                                    ``(I) In general.--The term `small 
                                business' means, with respect to any 
                                calendar year, any person if the annual 
                                average number of employees employed by 
                                such person during either of the 2 
                                preceding calendar years was 500 or 
                                fewer. For purposes of the preceding 
                                sentence, a preceding calendar year may 
                                be taken into account only if the 
                                person was in existence throughout the 
                                year.
                                    ``(II) Startups, controlled groups, 
                                and predecessors.--Rules similar to the 
                                rules of subparagraphs (B) and (D) of 
                                section 220(c)(4) shall apply for 
                                purposes of this clause.
                            ``(iv) Federal laboratory.--For purposes of 
                        this subparagraph, the term `Federal 
                        laboratory' has the meaning given such term by 
                        section 4(6) of the Stevenson-Wydler Technology 
                        Innovation Act of 1980 (15 U.S.C. 3703(6)), as 
                        in effect on the date of the enactment of this 
                        subparagraph.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to amounts paid or incurred after the date of the enactment of 
this Act, in taxable years ending after such date.

                    Subtitle C--Technology Programs

SEC. 291. AUTHORIZATIONS OF APPROPRIATIONS FOR THE ADVANCED TECHNOLOGY 
              PROGRAM AND THE MANUFACTURING EXTENSION PARTNERSHIP 
              PROGRAM.

    (a) Advanced Technology Program.--
            (1) Findings.--Congress makes the following findings:
                    (A) The Advanced Technology Program (ATP) has 
                played an important role in helping United States 
                companies develop new, breakthrough technologies. ATP 
                has funded research ranging from cancer vaccines, to 
                hi-tech flexible displays, to composite materials, to 
                fuel cells, all of which are the kinds of technological 
                advances that give the United States a competitive 
                advantage globally.
                    (B) The National Academy of Science has found it to 
                be an effective program that could use more funding 
                wisely, and the National Association of Manufacturers 
                (NAM), the Biotechnology Industry Organization (BIO), 
                the Industrial Research Institute, the Alliance for 
                Science and Technology Research in America, and the 
                American Chemical Society support ATP.
                    (C) Businesses need this type of program more than 
                ever as venture capital funds have become more scarce 
                in the current economy. ATP bridges this gap between 
                the research lab and market capital, facilitating the 
                critical transfer of technology to the private sector 
                that leads to the development of products and services 
                that make use of new, technological breakthroughs.
                    (D) Not only does ATP promote economic security and 
                global competitiveness for the nation as a whole, it is 
                an important program for generating jobs domestically. 
                Last year nearly 80 percent of ATP awards went to small 
                businesses, an essential job-creating sector in the 
                United States economy.
                    (E) ATP is also vital to the homeland security of 
                the United States. ATP has funded many projects in 
                detection, preparedness, prevention and response with 
                significant applications for homeland security. With 
                continued financial support through ATP to develop 
                these projects and their security applications, the 
                United States will become more secure.
                    (F) Despite the importance and success of ATP, 
                current funding levels do not meet the demand. Over 
                1,000 proposals for ATP funding that were submitted in 
                2002 yielded enough high quality projects for the ATP 
                funding that was available in both fiscal years 2002 
                and 2003. The 870 applications for ATP funding received 
                in fiscal year 2004 made the second highest number of 
                applications for ATP funding that were received in any 
                fiscal year, but funding was only available for 59 
                awards. No funding for new awards is available in 
                fiscal year 2005.
                    (G) According to the 2004 annual report on the ATP, 
                returns from just 41 of the 736 ATP projects have 
                exceeded $17,000,000,000 in economic benefits, more 
                than 8 times the amount of money spent on all 736 
                projects.
            (2) Authorization of appropriations.--There are authorized 
        to be appropriated to the Secretary of Commerce for the 
        Advanced Technology Program of the National Institute of 
        Standards and Technology--
                    (A) $247,200,000 for fiscal year 2005;
                    (B) $254,616,000 for fiscal year 2006;
                    (C) $262,254,000 for fiscal year 2007; and
                    (D) $270,122,000 for fiscal year 2008.
    (b) Manufacturing Extension Partnership Program.--
            (1) Findings.--Congress makes the following findings:
                    (A) Small- and medium-sized manufacturers in the 
                United States employ 7,000,000 people and contribute 
                $711,000,000,000, or 7 percent of the Gross Domestic 
                Product to the United States economy. The Hollings 
                Manufacturing Extension Partnership (MEP) Program 
                supports a network of locally run centers that provide 
                technical advice and consulting to these firms in all 
                fifty States and Puerto Rico. Since its inception, the 
                Hollings MEP Program has assisted 149,000 of the 
                380,000 small and medium-sized manufacturers in the 
                United States.
                    (B) The Hollings MEP Program is a proven program. 
                Studies show that Hollings MEP Program manufacturers 
                have four times more productivity growth than non-MEP 
                firms, and the program has proven to lead to increased 
                sales, increased capital investment, cost savings and 
                the creation or retention of jobs in the United States.
                    (C) The Hollings MEP Program is more important 
                today than ever as the Nation faces a looming current 
                account deficit. The United States has lost over 
                880,000 manufacturing jobs during 2003 and 2004. Such 
                manufacturing jobs pay on average 19 percent higher 
                wages than the industry average.
                    (D) The Hollings MEP Program is not just about 
                economic security. Manufacturers with fewer than 500 
                employees comprise more than 80 percent of the 
                suppliers in key defense sectors. Helping such 
                manufacturers helps the national security of the United 
                States.
            (2) Authorization of appropriations.--There are authorized 
        to be appropriated to the Secretary of Commerce for the 
        Hollings Manufacturing Extension Partnership Program of the 
        National Institute of Standards and Technology--
                    (A) $110,210,000 for fiscal year 2005;
                    (B) $113,516,000 for fiscal year 2006;
                    (C) $116,921,000 for fiscal year 2007; and
                    (D) $120,429,000 for fiscal year 2008.
            (3) Manufacturing extension partnership program defined.--
        In this subsection, the term ``Hollings Manufacturing Extension 
        Partnership Program'' means the program of Hollings 
        Manufacturing Extension Partnership carried out by the National 
        Institute of Standards and Technology under section 26 of the 
        National Institute of Standards and Technology Act (15 U.S.C. 
        278l), as provided in part 292 of title 15, Code of Federal 
        Regulations.

SEC. 292. SENSE OF THE SENATE PROMOTING SCIENCE AND TECHNOLOGY FUNDING 
              FOR A STRONGER ECONOMIC FUTURE.

    (a) Findings.--The Senate makes the following findings:
            (1) Leading economists have consistently attributed more 
        than 50 percent of the growth in the economy of the United 
        States to scientific and technological innovation. The economic 
        future of the United States, thus, depends on the United States 
        remaining the world leader in science and technology.
            (2) If the United States loses its leadership in science 
        and technology, its capacity for economic growth and high-wage 
        job creation will soon atrophy, with deleterious effects on the 
        national security of the United States. In 2001, the Hart-
        Rudman Commission on National Security for the 21st Century 
        characterized the failure of the United States to invest in 
        science and to reform science and mathematics education as the 
        second biggest threat to national security, stating that 
        ``[s]econd only to a weapon of mass destruction detonating in 
        an American city, we can think of nothing more dangerous than a 
        failure to manage properly science, technology, and education 
        for the common good over the next quarter century''.
            (3) The United States has reaped enormous economic benefits 
        from being the first country to lead in the development of the 
        Internet and the harnessing of biotechnology. These 
        developments, though, are far from being the last technological 
        revolutions to influence the economy of the United States. 
        Technological changes that promise major economic effects are 
        now being made in areas such as--
                    (A) microelectronics, including the continued 
                miniaturization of electronic devices and the 
                increasingly widespread diffusion of data processing 
                power;
                    (B) high-end supercomputing;
                    (C) telecommunications technologies;
                    (C) artificial materials, including materials in 
                which the structure has been designed and built at the 
                atomic or molecular level, the essence of 
                nanotechnology;
                    (D) robotics; and
                    (E) new energy technologies, particular including 
                renewable energy technologies that are as inexpensive 
                as traditional fossil sources of energy, technologies 
                using hydrogen as an energy carrier, and technologies 
                for energy efficiencies.
            (4) Because of the interconnected nature of modern science 
        and technology, advances in one field depend on research 
        results in other, seemingly unrelated fields. Biomedical 
        science has been consistently shown to rely on advances in 
        fields such as chemistry, materials science, mathematics, 
        computer science, and physics. Without basic advances in 
        chemistry, computer science, and mathematics, the sequencing of 
        the human genome could not have been successfully undertaken.
            (5) In the 60 years since World War II, other countries and 
        regions of the world have built science and technology 
        capabilities that rival those of the United States today, or 
        that could rival such capabilities of the United States in the 
        future. The governments of China, India, Japan, and the 
        countries of the European Union have all targeted significant 
        advancements in research and innovation as central elements of 
        the plans for future national and regional economic prosperity.
            (6) President George W. Bush has largely ignored this 
        challenge, proposing budgets that have under-funded or 
        terminated key programs promoting United States scientific and 
        technological strength, including cuts to--
                    (A) basic and applied research in the Department of 
                Defense;
                    (B) agricultural research;
                    (C) transportation research; and
                    (D) fundamental research in the physical sciences 
                and engineering at the Department of Energy and 
                elsewhere.
            (7) For other programs that have been proposed for small 
        increases, such as the National Science Foundation, the amount 
        of funding provided to individual grantees is well below the 
        amounts that would lead to optimal scientific productivity and 
        continued United States leadership in science and technology. 
        In fiscal year 2004, the National Science Foundation's 
        stringent peer review evaluation process judged approximately 
        12,000 out of some 40,000 proposals as ``very good to 
        excellent'' or ``excellent,'' yet, due to budget constraints, 
        only 56 percent of such proposals were funded.
            (8) The National Science Foundation and the Office of 
        Science in the Department of Energy are among the greatest 
        assets of the United States for the advancement of science, 
        mathematical, engineering, and technology research and 
        education. Although the National Science Foundation accounts 
        for only 4 percent of Federal research and development 
        spending, it provides nearly 50 percent of all Federal support 
        for non-medical basic research conducted in United States 
        colleges and universities. Similarly, the Office of Science of 
        the Department of Energy funds over half of all university 
        research in disciplines such as physics and materials science, 
        and has played a crucial role in national science and 
        technology initiatives such as advancing high-performance 
        computing and the sequencing of the human genome. Both the 
        National Science Foundation and the Office of Science fund 
        research in new frontiers of scientific inquiry and contribute 
        to creating a highly skilled, competitive workforce in science 
        and engineering.
            (9) President Bush has also consistently proposed 
        terminating the Advanced Technology Program at the Department 
        of Commerce, which helps stimulate companies to participate in 
        high-risk, high-payoff research and development and is perhaps 
        one of the most successful programs in directly stimulating 
        industrial innovation in the United States. Projects supported 
        by the Advanced Technology Program span a broad range of key 
        technology areas, such as oil exploration, automobile 
        manufacturing, and new medical diagnostic and therapeutic 
        technologies and investments made by the program accelerate the 
        development process for innovative technologies that promise 
        significant commercial payoff and widespread benefits.
            (10) The continual cycle of basic research, applied 
        research, and development gives rise to new products and 
        processes, new ideas and understanding, and new researchers and 
        educators. Each link in this chain depends on the others. Basic 
        research produces the fundamental understandings that underpin 
        applications and the development process. The resulting 
        technologies and innovations create economic growth through new 
        products and job creation and stimulate new thinking and 
        advances in scientific instrumentation, which in turn stimulate 
        new inquiries that lead to new fundamental research. All of 
        this activity improves the quality of life in the United 
        States, and when adequately supported, contributes to the 
        continued leadership of the United States in science and 
        technology.
            (11) A revitalized science and technology policy focused on 
        advancing all of the links of this chain, from basic research 
        through technology deployment, is necessary if the United 
        States is to maintain its technological preeminence over the 
        next decade and beyond. Applications stemming from basic 
        research can take over 20 years to evolve into next generation 
        technologies. Inadequate funding of basic research may not seem 
        acute today, but 20 years from now, it will be extremely 
        difficult to correct an inability of the United States to 
        compete scientifically and technologically, which could be 
        caused by inadequate funding now.
            (12) In order to ensure strength in these areas, it is 
        necessary for the United States Government to ensure that 
        scientists and technology experts in the United States receive 
        the best education possible. After the Russians launched 
        Sputnik, Congress passed the National Defense Education Act of 
        1958 (Public Law 85-864), which declared ``an educational 
        emergency'' and led to the more than doubling of Federal 
        expenditures for education. The programs authorized under that 
        Act helped the United States to improve rapidly in the areas of 
        science and technology, and led to United States dominance in 
        the arms race and the global economy.
            (13) The United States would be well served by the 
        enactment of a new National Defense Education Act. Third in the 
        world in 1975, America now ranks 15th in the development of new 
        scientists and engineers. Today, India and China annually 
        produce 10 times as many new engineers as the United States. 
        Out of over 15,000,000 college students in the United States, 
        fewer than 400,000 individuals graduate with a bachelor's 
        degree in math, science, engineering, or technology each year, 
        and only 75,000 postgraduate students go on to obtain a 
        master's degree in math, science, engineering, or technology.
    (b) Sense of the Senate.--It is the sense of the Senate that--
            (1) Congress and the President should direct significant 
        new investments in the National Science Foundation, the Office 
        of Science at the Department of Energy, the National Institutes 
        of Health, and the National Institute of Standards and 
        Technology to increase federally funded research in basic 
        science and technology so that the United States can better 
        compete in the international economy; and
            (2) Congress and the President should direct significant 
        new investments into the enhancement of elementary and 
        secondary education programs related to math, science, and 
        technology and substantially expand access to postsecondary 
        education for United States students seeking degrees in math, 
        science, and technology.

               TITLE III--FAIR TRADE AND COMPETITIVENESS

               Subtitle A--Trade Enforcement Enhancement

SEC. 311. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

    Section 310 of the Trade Act of 1974 (19 U.S.C. 2420) is amended to 
read as follows:

``SEC. 310. IDENTIFICATION OF TRADE EXPANSION PRIORITIES.

    ``(a) Identification.--
            ``(1) Identification and report.--Within 30 days after the 
        submission in each of calendar year 2005 through 2009 of the 
        report required by section 181(b), the Trade Representative 
        shall--
                    ``(A) review United States trade expansion 
                priorities;
                    ``(B) identify priority foreign country practices, 
                the elimination of which is likely to have the most 
                significant potential to increase United States 
                exports, either directly or through the establishment 
                of a beneficial precedent; and
                    ``(C) submit to the Committee on Finance of the 
                Senate and the Committee on Ways and Means of the House 
                of Representatives and publish in the Federal Register 
                a report on the priority foreign country practices 
                identified.
            ``(2) Factors.--In identifying priority foreign country 
        practices under paragraph (1), the Trade Representative shall 
        take into account all relevant factors, including--
                    ``(A) the major barriers and trade distorting 
                practices described in the National Trade Estimate 
                Report required under section 181(b);
                    ``(B) the trade agreements to which a foreign 
                country is a party and its compliance with those 
                agreements;
                    ``(C) the medium- and long-term implications of 
                foreign government procurement plans; and
                    ``(D) the international competitive position and 
                export potential of United States products and 
                services.
            ``(3) Contents of report.--The Trade Representative may 
        include in the report, if appropriate--
                    ``(A) a description of foreign country practices 
                that may in the future warrant identification as 
                priority foreign country practices; and
                    ``(B) a statement about other foreign country 
                practices that were not identified because they are 
                already being addressed by provisions of United States 
                trade law, by existing bilateral trade agreements, or 
                as part of trade negotiations with other countries and 
                progress is being made toward the elimination of such 
                practices.
    ``(b) Initiation of Consultations.--By no later than the date that 
is 21 days after the date on which a report is submitted to the 
appropriate congressional committees under subsection (a)(1), the Trade 
Representative shall seek consultations with each foreign country 
identified in the report as engaging in priority foreign country 
practices for the purpose of reaching a satisfactory resolution of such 
priority practices.
    ``(c) Initiation of Investigation.--If a satisfactory resolution of 
priority foreign country practices has not been reached under 
subsection (b) within 90 days after the date on which a report is 
submitted to the appropriate congressional committees under subsection 
(a)(1), the Trade Representative shall initiate under section 302(b)(1) 
an investigation under this chapter with respect to such priority 
foreign country practices.
    ``(d) Agreements for the Elimination of Barriers.--In the 
consultations with a foreign country that the Trade Representative is 
required to request under section 303(a) with respect to an 
investigation initiated by reason of subsection (c), the Trade 
Representative shall seek to negotiate an agreement that provides for 
the elimination of the practices that are the subject of the 
investigation as quickly as possible or, if elimination of the 
practices is not feasible, an agreement that provides for compensatory 
trade benefits.
    ``(e) Reports.--The Trade Representative shall include in the 
semiannual report required by section 309 a report on the status of any 
investigations initiated pursuant to subsection (c) and, where 
appropriate, the extent to which such investigations have led to 
increased opportunities for the export of products and services of the 
United States.''.

SEC. 312. CHIEF ENFORCEMENT NEGOTIATOR.

    (a) Establishment of Position.--Section 141(b)(2) of the Trade Act 
of 1974 (19 U.S.C. 2171(b)(2)) is amended to read as follows:
    ``(2) There shall be in the Office 3 Deputy United States Trade 
Representatives, 1 Chief Agricultural Negotiator, and 1 Chief 
Enforcement Negotiator. The 3 Deputy United States Trade 
Representatives and the 2 Chief Negotiators shall be appointed by the 
President, by and with the advice and consent of the Senate. As an 
exercise of the rulemaking power of the Senate, any nomination of a 
Deputy United States Trade Representative, the Chief Agricultural 
Negotiator, or the Chief Enforcement Negotiator submitted to the Senate 
for its advice and consent, and referred to a committee, shall be 
referred to the Committee on Finance. Each Deputy United States Trade 
Representative, the Chief Agricultural Negotiator, and the Chief 
Enforcement Negotiator shall hold office at the pleasure of the 
President and shall have the rank of Ambassador.''.
    (b) Functions of Position.--Section 141(c) of the Trade Act of 1974 
(19 U.S.C. 2171(c)) is amended by adding at the end the following new 
paragraph:
    ``(6) The principal function of the Chief Enforcement Negotiator 
shall be to conduct negotiations to ensure compliance with trade 
agreements relating to United States manufactured goods and services. 
The Chief Enforcement Negotiator shall recommend investigating and 
prosecuting cases before the World Trade Organization and under trade 
agreements to which the United States is a party. The Chief Enforcement 
Negotiator shall recommend administering United States trade laws 
relating to foreign government barriers to United States goods and 
services. The Chief Enforcement Negotiator shall perform such other 
functions as the United States Trade Representative may direct.''.

SEC. 313. FOREIGN DEBT.

    (a) Short Title.--This section may be cited as the ``Foreign Debt 
Ceiling Act of 2005''.
    (b) Foreign Debt Ceiling.--
            (1) Findings.--Congress makes the following findings:
                    (A) The United States has become the world's 
                largest net debtor Nation, having run up massive trade 
                deficits since the 1990s.
                    (B) At the end of 2002, the net United States 
                foreign debt stood at $2,553,000,000,000.
                    (C) The United States foreign debt position 
                worsened in 2003, when the United States had a record 
                trade deficit of $489,000,000,000, equivalent to 4.4 
                percent of the United States GDP that year.
                    (D) The large and growing United States foreign 
                debt represents claims on United States assets by 
                foreign nationals, which will eventually have to be 
                repaid. If unchecked, the foreign debt could seriously 
                undermine our children's future standard of living.
                    (E) Moreover, the growing accumulation of foreign 
                claims on United States assets, including over 
                $1,200,000,000,000 in United States Treasury 
                securities, makes the United States economy vulnerable 
                to the whims of foreign investors.
                    (F) Congress presently places a ceiling on United 
                States public debt, but does not place a ceiling on 
                United States foreign debt.
                    (G) Just as Congress recognized the importance of 
                placing a ceiling on the United States public debt, it 
                is appropriate that Congress place a limit on the 
                United States foreign debt.
            (2) Actions triggered by united states foreign debt.--
                    (A) In general.--Not later than the 15th day of the 
                second month after the date of enactment of this Act, 
                and every 3 months thereafter, the United States Trade 
                Representative shall determine if--
                            (i) the net United States foreign debt for 
                        the preceding 12-month period is more than 25 
                        percent of United States GDP for the same 
                        period; or
                            (ii) the United States trade deficit for 
                        the preceding 12-month period is more than 5 
                        percent of United States GDP for the same 
                        period.
                    (B) Action by ustr.--Whenever an affirmative 
                determination is made under subparagraph (A) (i) or 
                (ii), the United States Trade Representative shall--
                            (i) within 15 days of the determination, 
                        convene an emergency meeting of the Trade 
                        Policy Review Group to develop a plan of action 
                        to reduce the United States trade deficit; and
                            (ii) within 45 days of the determination, 
                        present to Congress a report detailing the 
                        Trade Policy Review Group's trade deficit 
                        reduction plan.
            (3) Measurement of foreign debt.--
                    (A) Statistical sources.--For purposes of the 
                calculations described in paragraph (2)(A), the United 
                States Trade Representative shall rely on the most 
                recent period for which the following data, published 
                by the Department of Commerce, is available:
                            (i) In the case of United States foreign 
                        debt, the United States Trade Representative 
                        shall use the net international investment 
                        position of the United States, with direct 
                        investment positions determined at market 
                        value, as compiled by the Bureau of Economic 
                        Analysis.
                            (ii) In the case of the United States trade 
                        deficit, the United States Trade Representative 
                        shall use the goods and services trade deficit 
                        data compiled by the United States Census 
                        Bureau.
                            (iii) In the case of the United States GDP, 
                        the United States Trade Representative shall 
                        use the nominal gross domestic product data 
                        compiled by the Bureau of Economic Analysis.
                    (B) Adjustment.--The United States Trade 
                Representative may adjust the data described in 
                subparagraph (A) to ensure that the determination is 
                made for comparable time period.

SEC. 314. AUTHORIZATION OF APPROPRIATIONS.

    (a) Authorization of Appropriations for the Office of the General 
Counsel and the Office of Monitoring and Enforcement.--There are 
authorized to be appropriated to the Office of the United States Trade 
Representative for the appointment of additional staff in the Office of 
the General Counsel and the Office of Monitoring and Enforcement--
            (1) $2,000,000 for fiscal year 2005; and
            (2) $2,000,000 for fiscal year 2006.
    (b) Responsibilities of Additional Staff.--The responsibilities of 
the additional staff appointed under subsection (a) shall include--
            (1) investigating, prosecuting, and defending cases before 
        the World Trade Organization and under trade agreements to 
        which the United States is a party;
            (2) administering United States trade laws, including title 
        III of the Trade Act of 1974 (19 U.S.C. 2411 et seq.) and other 
        trade laws relating to foreign government barriers to United 
        States goods and services, including barriers involving 
        intellectual property rights, government procurement, and 
        telecommunications; and
            (3) monitoring compliance with the Uruguay Round Agreements 
        (as defined in section 2 of the Uruguay Round Agreements Act 
        (19 U.S.C. 3501)) and other trade agreements, particularly by 
        the People's Republic of China.

       Subtitle B--Exchange Rate Policy and Currency Manipulation

SEC. 321. NEGOTIATIONS REGARDING CURRENCY VALUATION.

    (a) Findings.--Congress makes the following findings:
            (1) The currency of the People's Republic of China, known 
        as the yuan or renminbi, is artificially pegged at a level 
        significantly below its market value. Economists estimate the 
        yuan to be undervalued by between 15 percent and 40 percent or 
        an average of 27.5 percent.
            (2) The undervaluation of the yuan provides the People's 
        Republic of China with a significant trade advantage by making 
        exports less expensive for foreign consumers and by making 
        foreign products more expensive for Chinese consumers. The 
        effective result is a significant subsidization of China's 
        exports and a virtual tariff on foreign imports.
            (3) The Government of the People's Republic of China has 
        intervened in the foreign exchange markets to hold the value of 
        the yuan within an artificial trading range. China's foreign 
        reserves are estimated to be over $609,900,000,000 as of 
        January 12, 2004, and have increased by over $206,700,000,000 
        in the last 12 months.
            (4) China's undervalued currency, China's trade advantage 
        from that undervaluation, and the Chinese Government's 
        intervention in the value of its currency violates the spirit 
        and letter of the world trading system of which the People's 
        Republic of China is now a member.
            (5) The Government of the People's Republic of China has 
        failed to promptly address concerns or to provide a definitive 
        timetable for resolution of these concerns raised by the United 
        States and the international community regarding the value of 
        its currency.
            (6) Article XXI of the GATT 1994 (as defined in section 
        2(1)(B) of the Uruguay Round Agreements Act (19 U.S.C. 
        3501(1)(B))) allows a member of the World Trade Organization to 
        take any action which it considers necessary for the protection 
        of its essential security interests. Protecting the United 
        States manufacturing sector is essential to the interests of 
        the United States.
    (b) Negotiations and Certification Regarding the Currency Valuation 
Policy of the People's Republic of China.--
            (1) In general.--Notwithstanding the provisions of title I 
        of Public Law 106-286 (19 U.S.C. 2431 note), on and after the 
        date that is 180 days after the date of enactment of this Act, 
        unless a certification described in paragraph (2) has been made 
        to Congress, in addition to any other duty, there shall be 
        imposed a rate of duty of 27.5 percent ad valorem on any 
        article that is the growth, product, or manufacture of the 
        People's Republic of China, imported directly or indirectly 
        into the United States.
            (2) Certification.--The certification described in this 
        paragraph means a certification by the President to Congress 
        that the People's Republic of China is no longer acquiring 
        foreign exchange reserves to prevent the appreciation of the 
        rate of exchange between its currency and the United States 
        dollar for purposes of gaining an unfair competitive advantage 
        in international trade. The certification shall also include a 
        determination that the currency of the People's Republic of 
        China has undergone a substantial upward revaluation placing it 
        at or near its fair market value.
            (3) Alternative certification.--If the President certifies 
        to Congress 180 days after the date of enactment of this Act 
        that the People's Republic of China has made a good faith 
        effort to revalue its currency upward placing it at or near its 
        fair market value, the President may delay the imposition of 
        the tariffs described in paragraph (1) for an additional 180 
        days. If at the end of the 180-day period the President 
        determines that China has developed and started actual 
        implementation of a plan to revalue its currency, the President 
        may delay imposition of the tariffs for an additional 12 
        months, so that the People's Republic of China shall have time 
        to implement the plan.
            (4) Negotiations.--Beginning on the date of enactment of 
        this Act, the Secretary of the Treasury, in consultation with 
        the United States Trade Representative, shall begin 
        negotiations with the People's Republic of China to ensure that 
        the People's Republic of China adopts a process that leads to a 
        substantial upward currency revaluation within 180 days after 
        the date of enactment of this Act. Because various Asian 
        governments have also been acquiring substantial foreign 
        exchange reserves in an effort to prevent appreciation of their 
        currencies for purposes of gaining an unfair competitive 
        advantage in international trade, and because the People's 
        Republic of China has concerns about the value of those 
        currencies, the Secretary shall also seek to convene a 
        multilateral summit to discuss exchange rates with 
        representatives of various Asian governments and other 
        interested parties, including representatives of other G-7 
        nations.

                Subtitle C--Trade Adjustment Assistance

                       CHAPTER 1--SERVICE WORKERS

SEC. 331. SHORT TITLE.

    This chapter may be cited as the ``Trade Adjustment Assistance 
Equity for Service Workers Act of 2005''.

SEC. 332. EXTENSION OF TRADE ADJUSTMENT ASSISTANCE TO SERVICES SECTOR.

    (a) Adjustment Assistance for Workers.--Section 221(a)(1)(A) of the 
Trade Act of 1974 (19 U.S.C. 2271(a)(1)(A)) is amended by striking 
``agricultural firm)'' and inserting ``agricultural firm, and workers 
in a service sector firm or subdivision of a service sector firm or 
public agency)''.
    (b) Group Eligibility Requirements.--Section 222 of the Trade Act 
of 1974 (19 U.S.C. 2272) is amended--
            (1) in subsection (a)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``agricultural firm)'' and inserting 
                ``agricultural firm, and workers in a service sector 
                firm or subdivision of a service sector firm or public 
                agency)'';
                    (B) in paragraph (1), by inserting ``or public 
                agency'' after ``of the firm''; and
                    (C) in paragraph (2)--
                            (i) in subparagraph (A)(ii), by striking 
                        ``like or directly competitive with articles 
                        produced'' and inserting ``or services like or 
                        directly competitive with articles produced or 
                        services provided''; and
                            (ii) by striking subparagraph (B) and 
                        inserting the following:
            ``(B)(i) there has been a shift, by such workers' firm, 
        subdivision, or public agency to a foreign country, of 
        production of articles, or in provision of services, like or 
        directly competitive with articles which are produced, or 
        services which are provided, by such firm, subdivision, or 
        public agency; or
            ``(ii) such workers' firm, subdivision, or public agency 
        has obtained or is likely to obtain such services from a 
        foreign country.'';
            (2) in subsection (b)--
                    (A) in the matter preceding paragraph (1), by 
                striking ``agricultural firm)'' and inserting 
                ``agricultural firm, and workers in a service sector 
                firm or subdivision of a service sector firm or public 
                agency)'';
                    (B) in paragraph (2), by inserting ``or service'' 
                after ``related to the article''; and
                    (C) in paragraph (3)(A), by inserting ``or 
                services'' after ``component parts'';
            (3) in subsection (c)--
                    (A) in paragraph (3)--
                            (i) by inserting ``or services'' after 
                        ``value-added production processes'';
                            (ii) by striking ``assembly or finishing'' 
                        and inserting ``assembly, finishing, or 
                        testing'';
                            (iii) by inserting ``or services'' after 
                        ``for articles''; and
                            (iv) by inserting ``(or subdivision)'' 
                        after ``such other firm''; and
                    (B) in paragraph (4)--
                            (i) by striking ``for articles'' and 
                        inserting ``, or services, used in the 
                        production of articles or in the provision of 
                        services''; and
                            (ii) by inserting ``(or subdivision)'' 
                        after ``such other firm''; and
            (4) by adding at the end the following new subsection:
    ``(d) Basis for Secretary's Determinations.--
            ``(1) Increased imports.--For purposes of subsection 
        (a)(2)(A)(ii), the Secretary may determine that increased 
        imports of like or directly competitive articles or services 
        exist if the workers' firm or subdivision or customers of the 
        workers' firm or subdivision accounting for not less than 20 
        percent of the sales of the workers' firm or subdivision 
        certify to the Secretary that they are obtaining such articles 
        or services from a foreign country.
            ``(2) Obtaining services abroad.--For purposes of 
        subsection (a)(2)(B)(ii), the Secretary may determine that the 
        workers' firm, subdivision, or public agency has obtained or is 
        likely to obtain like or directly competitive services from a 
        firm in a foreign country based on a certification thereof from 
        the workers' firm, subdivision, or public agency.
            ``(3) Authority of the secretary.--The Secretary may obtain 
        the certifications under paragraphs (1) and (2) through 
        questionnaires or in such other manner as the Secretary 
        determines is appropriate.''.
    (c) Training.--Section 236(a)(2)(A) of the Trade Act of 1974 (19 
U.S.C. 2296(a)(2)(A)) is amended by striking ``$220,000,000'' and 
inserting ``$440,000,000''.
    (d) Definitions.--Section 247 of the Trade Act of 1974 (19 U.S.C. 
2319) is amended--
            (1) in paragraph (1)--
                    (A) by inserting ``or public agency'' after ``of a 
                firm''; and
                    (B) by inserting ``or public agency'' after ``or 
                subdivision'';
            (2) in paragraph (2)(B), by inserting ``or public agency'' 
        after ``the firm'';
            (3) by redesignating paragraphs (8) through (17) as 
        paragraphs (9) through (18), respectively; and
            (4) by inserting after paragraph (6) the following:
            ``(7) The term `public agency' means a department or agency 
        of a State or local government or of the Federal Government.
            ``(8) The term `service sector firm' means an entity 
        engaged in the business of providing services.''.
    (e) Technical Amendment.--Section 245(a) of the Trade Act of 1974 
(19 U.S.C. 2317(a)) is amended by striking ``, other than subchapter 
D''.

SEC. 333. TRADE ADJUSTMENT ASSISTANCE FOR FIRMS AND INDUSTRIES.

    (a) Firms.--
            (1) Assistance.--Section 251 of the Trade Act of 1974 (19 
        U.S.C. 2341) is amended--
                    (A) in subsection (a), by inserting ``or service 
                sector firm'' after ``(including any agricultural 
                firm'';
                    (B) in subsection (c)(1)--
                            (i) in the matter preceding subparagraph 
                        (A), by inserting ``or service sector firm'' 
                        after ``(including any agricultural firm'';
                            (ii) in subparagraph (B)(ii), by inserting 
                        ``or service'' after ``of an article''; and
                            (iii) in subparagraph (C), by striking 
                        ``articles like or directly competitive with 
                        articles which are produced'' and inserting 
                        ``articles or services like or directly 
                        competitive with articles or services which are 
                        produced or provided''; and
                    (C) by adding at the end the following:
    ``(e) Basis for Secretary Determination.--
            ``(1) Increased imports.--For purposes of subsection 
        (c)(1)(C), the Secretary may determine that increases of 
        imports of like or directly competitive articles or services 
        exist if customers accounting for not less than 20 percent of 
        the sales of the workers' firm certify to the Secretary that 
        they are obtaining such articles or services from a foreign 
        country.
            ``(2) Authority of the secretary.--The Secretary may obtain 
        the certifications under paragraph (1) through questionnaires 
        or in such other manner as the Secretary determines is 
        appropriate. The Secretary may exercise the authority under 
        section 249 in carrying out this subsection.''.
            (2) Authorization of appropriations.--Section 256(b) of the 
        Trade Act of 1974 (19 U.S.C. 2346(b)) is amended by striking 
        ``$16,000,000'' and inserting ``$32,000,000''.
            (3) Definitions.--Section 261 of the Trade Act of 1974 (19 
        U.S.C. 2351) is amended to read as follows:

``SEC. 261. DEFINITIONS.

    ``For purposes of this chapter:
            ``(1) Firm.--The term `firm' includes an individual 
        proprietorship, partnership, joint venture, association, 
        corporation (including a development corporation), business 
        trust, cooperative, trustee in bankruptcy, and receiver under 
        decree of any court. A firm, together with any predecessor or 
        successor firm, or any affiliated firm controlled or 
        substantially beneficially owned by substantially the same 
        persons, may be considered a single firm where necessary to 
        prevent unjustifiable benefits.
            ``(2) Service sector firm.--The term `service sector firm' 
        means a firm engaged in the business of providing services.''.
    (b) Industries.--Section 265(a) of the Trade Act of 1974 (19 U.S.C. 
2355(a)) is amended by inserting ``or service'' after ``new product''.

SEC. 334. MONITORING AND REPORTING.

    Section 282 of the Trade Act of 1974 (19 U.S.C. 2393) is amended--
            (1) in the first sentence--
                    (A) by striking ``The Secretary'' and inserting 
                ``(a) Monitoring Programs.--The Secretary'';
                    (B) by inserting ``and services'' after ``imports 
                of articles'';
                    (C) by inserting ``and domestic provision of 
                services'' after ``domestic production'';
                    (D) by inserting ``or providing services'' after 
                ``producing articles''; and
                    (E) by inserting ``, or provision of services,'' 
                after ``changes in production''; and
            (2) by adding at the end the following:
    ``(b) Collection of Data and Reports on Services Sector.--
            ``(1) Secretary of labor.--Not later than 3 months after 
        the date of the enactment of the Trade Adjustment Assistance 
        Equity for Service Workers Act of 2005, the Secretary of Labor 
        shall implement a system to collect data on adversely affected 
        service workers that includes the number of workers by State, 
        industry, and cause of dislocation of each worker.
            ``(2) Secretary of commerce.--Not later than 6 months after 
        such date of enactment, the Secretary of Commerce shall, in 
        consultation with the Secretary of Labor, conduct a study and 
        report to the Congress on ways to improve the timeliness and 
        coverage of data on trade in services, including methods to 
        identify increased imports due to the relocation of United 
        States firms to foreign countries, and increased imports due to 
        United States firms obtaining services from firms in foreign 
        countries.''.

SEC. 335. ALTERNATIVE TRADE ADJUSTMENT ASSISTANCE.

    (a) In General.--Section 246(a)(3) of the Trade Act of 1974 (19 
U.S.C. 2318(a)(3)) is amended to read as follows:
            ``(3) Eligibility.--A worker in the group that the 
        Secretary has certified as eligible for the alternative trade 
        adjustment assistance program may elect to receive benefits 
        under the alternative trade adjustment assistance program if 
        the worker--
                    ``(A) is covered by a certification under 
                subchapter A of this chapter;
                    ``(B) obtains reemployment not more than 26 weeks 
                after the date of separation from the adversely 
                affected employment;
                    ``(C) is at least 40 years of age;
                    ``(D) earns not more than $50,000 a year in wages 
                from reemployment;
                    ``(E) is employed on a full-time basis as defined 
                by State law in the State in which the worker is 
                employed; and
                    ``(F) does not return to the employment from which 
                the worker was separated.''.
    (b) Conforming Amendments.--Section 246 of the Trade Act of 1974 
(19 U.S.C. 2318) is amended--
            (1) in subsection (a)(2)(A), by striking ``paragraph 
        (3)(B)'' and inserting ``paragraph (3)'';
            (2) in subsection (a)(2)(B), by striking ``paragraph 
        (3)(B)'' and inserting ``paragraph (3)''; and
            (3) in subsection (b)(2), by striking ``subsection 
        (a)(3)(B)'' and inserting ``subsection (a)(3)''.

SEC. 336. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b), the 
amendments made by this chapter shall take effect on the date of 
enactment of this Act.
    (b) Special Rule for Certain Service Workers.--A group of workers 
in a service sector firm, or subdivision of a service sector firm, or 
public agency (as defined in section 247 (7) and (8) of the Trade Act 
of 1974, as added by section 332(d) of this Act) who--
            (1) would have been certified eligible to apply for 
        adjustment assistance under chapter 2 of title II of the Trade 
        Act of 1974 if the amendments made by this Act had been in 
        effect on November 4, 2002; and
            (2) file a petition pursuant to section 221 of the Trade 
        Act of 1974 (19 U.S.C. 2271) not later than 6 months after the 
        date of enactment of this Act, shall be eligible for 
        certification under section 223 of the Trade Act of 1974 (19 
        U.S.C. 2273) if the workers' last total or partial separation 
        from the firm or subdivision of the firm or public agency 
        occurred on or after November 4, 2002 and before the date of 
        enactment of this Act.

         CHAPTER 2--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

SEC. 341. SHORT TITLE.

    This chapter may be cited as the ``Trade Adjustment Assistance for 
Communities Act of 2005''.

SEC. 342. PURPOSE.

    The purpose of this chapter is to assist communities negatively 
impacted by trade with economic adjustment through the integration of 
political and economic organizations, the coordination of Federal, 
State, and local resources, the creation of community-based development 
strategies, and the provision of economic transition assistance.

SEC. 343. TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES.

    (a) Repeal of Terminated Provisions.--Chapter 4 of the Trade Act of 
1974 (19 U.S.C. 2371 et seq.) is repealed.
    (b) Trade Adjustment Assistance for Communities.--Title II of the 
Trade Act of 1974 (19 U.S.C. 2251 et seq.) is amended by inserting 
after chapter 3 the following new chapter:

        ``CHAPTER 4--TRADE ADJUSTMENT ASSISTANCE FOR COMMUNITIES

``SEC. 271. DEFINITIONS.

    ``In this chapter:
            ``(1) Affected domestic producer.--The term `affected 
        domestic producer' means any manufacturer, producer, service 
        provider, farmer, rancher, fisherman or worker representative 
        (including associations of such persons) that was affected by a 
        finding under the Antidumping Act, 1921 (title II of the Act of 
        May 27, 1921; 42 Stat. 11, chapter 14), or by an antidumping or 
        countervailing duty order issued under title VII of the Tariff 
        Act of 1930 (19 U.S.C. 1671 et seq.).
            ``(2) Agricultural commodity producer.--The term 
        `agricultural commodity producer' has the same meaning as the 
        term `person' as prescribed by regulations promulgated under 
        section 1001(e) of the Food Security Act of 1985 (7 U.S.C. 
        1308(e)).
            ``(3) Community.--The term `community' means a city, 
        county, or other political subdivision of a State or a 
        consortium of political subdivisions of a State that the 
        Secretary certifies as being negatively impacted by trade.
            ``(4) Community negatively impacted by trade.--A community 
        negatively impacted by trade means a community with respect to 
        which a determination has been made under section 273.
            ``(5) Eligible community.--The term `eligible community' 
        means a community certified under section 273 for assistance 
        under this chapter.
            ``(6) Fisherman.--
                    ``(A) In general.--The term `fisherman' means any 
                person who--
                            ``(i) is engaged in commercial fishing; or
                            ``(ii) is a United States fish processor.
                    ``(B) Commercial fishing, fish, fishery, fishing, 
                fishing vessel, person, and united states fish 
                processor.--The terms `commercial fishing', `fish', 
                `fishery', `fishing', `fishing vessel', `person', and 
                `United States fish processor' have the same meanings 
                as given such terms in section 3 of the Magnuson-
                Stevens Fishery Conservation and Management Act (16 
                U.S.C. 1802).
            ``(7) Job loss.--The term `job loss' means the total 
        separation or partial separation of an individual, as those 
        terms are defined in section 247.
            ``(8) Secretary.--Except as otherwise provided, the term 
        `Secretary' means the Secretary of Commerce.

``SEC. 272. COMMUNITY TRADE ADJUSTMENT ASSISTANCE PROGRAM.

    ``(a) Establishment.--Not later than 6 months after the date of 
enactment of the Trade Adjustment Assistance for Communities Act of 
2005, the Secretary shall establish a Trade Adjustment Assistance for 
Communities Program at the Department of Commerce.
    ``(b) Personnel.--The Secretary shall designate such staff as may 
be necessary to carry out the responsibilities described in this 
chapter.
    ``(c) Coordination of Federal Response.--The Secretary shall--
            ``(1) provide leadership, support, and coordination for a 
        comprehensive management program to address economic 
        dislocation in eligible communities;
            ``(2) coordinate the Federal response to an eligible 
        community--
                    ``(A) by identifying all Federal, State, and local 
                resources that are available to assist the eligible 
                community in recovering from economic distress;
                    ``(B) by ensuring that all Federal agencies 
                offering assistance to an eligible community do so in a 
                targeted, integrated manner that ensures that an 
                eligible community has access to all available Federal 
                assistance;
                    ``(C) by assuring timely consultation and 
                cooperation between Federal, State, and regional 
                officials concerning economic adjustment for an 
                eligible community; and
                    ``(D) by identifying and strengthening existing 
                agency mechanisms designed to assist eligible 
                communities in their efforts to achieve economic 
                adjustment and workforce reemployment;
            ``(3) provide comprehensive technical assistance to any 
        eligible community in the efforts of that community to--
                    ``(A) identify serious economic problems in the 
                community that are the result of negative impacts from 
                trade;
                    ``(B) integrate the major groups and organizations 
                significantly affected by the economic adjustment;
                    ``(C) access Federal, State, and local resources 
                designed to assist in economic development and trade 
                adjustment assistance;
                    ``(D) diversify and strengthen the community 
                economy; and
                    ``(E) develop a community-based strategic plan to 
                address economic development and workforce dislocation, 
                including unemployment among agricultural commodity 
                producers, and fishermen;
            ``(4) establish specific criteria for submission and 
        evaluation of a strategic plan submitted under section 274(d);
            ``(5) establish specific criteria for submitting and 
        evaluating applications for grants under section 275;
            ``(6) administer the grant programs established under 
        sections 274 and 275; and
            ``(7) establish an interagency Trade Adjustment Assistance 
        for Communities Working Group, consisting of the 
        representatives of any Federal department or agency with 
        responsibility for economic adjustment assistance, including 
        the Department of Agriculture, the Department of Education, the 
        Department of Labor, the Department of Housing and Urban 
        Development, the Department of Health and Human Services, the 
        Small Business Administration, the Department of the Treasury, 
        the Department of Commerce, and any other Federal, State, or 
        regional department or agency the Secretary determines 
        necessary or appropriate.

``SEC. 273. CERTIFICATION AND NOTIFICATION.

    ``(a) Certification.--Not later than 45 days after an event 
described in subsection (c)(1), the Secretary shall determine if a 
community described in subsection (b)(1) is negatively impacted by 
trade, and if a positive determination is made, shall certify the 
community for assistance under this chapter.
    ``(b) Determination That Community Is Eligible.--
            ``(1) Community described.--A community described in this 
        paragraph means a community with respect to which on or after 
        October 1, 2005--
                    ``(A) the Secretary of Labor certifies a group of 
                workers (or their authorized representative) in the 
                community as eligible for assistance pursuant to 
                section 223;
                    ``(B) the Secretary of Commerce certifies a firm 
                located in the community as eligible for adjustment 
                assistance under section 251;
                    ``(C) the Secretary of Agriculture certifies a 
                group of agricultural commodity producers (or their 
                authorized representative) in the community as eligible 
                for adjustment assistance under section 293;
                    ``(D) an affected domestic producer is located in 
                the community; or
                    ``(E) the Secretary determines that a significant 
                number of fishermen in the community is negatively 
                impacted by trade.
            ``(2) Negatively impacted by trade.--The Secretary shall 
        determine that a community is negatively impacted by trade, 
        after taking into consideration--
                    ``(A) the number of jobs affected compared to the 
                size of the workforce in the community;
                    ``(B) the severity of the rates of unemployment in 
                the community and the duration of the unemployment in 
                the community;
                    ``(C) the income levels and the extent of 
                underemployment in the community;
                    ``(D) the outmigration of population from the 
                community and the extent to which the outmigration is 
                causing economic injury in the community; and
                    ``(E) the unique problems and needs of the 
                community.
    ``(c) Events Described.--
            ``(1) In general.--An event described in this paragraph 
        means one of the following:
                    ``(A) A notification described in paragraph (2).
                    ``(B) A certification of a firm under section 251.
                    ``(C) A finding under the Antidumping Act, 1921, or 
                an antidumping or countervailing duty order issued 
                under title VII of the Tariff Act of 1930.
                    ``(D) A determination by the Secretary that a 
                significant number of fishermen in a community have 
                been negatively impacted by trade.
            ``(2) Notification.--The Secretary of Labor, immediately 
        upon making a determination that a group of workers is eligible 
        for trade adjustment assistance under section 223, (or the 
        Secretary of Agriculture, immediately upon making a 
        determination that a group of agricultural commodity producers 
        is eligible for adjustment assistance under section 293, as the 
        case may be) shall notify the Secretary of the determination.
    ``(d) Notification to Eligible Communities.--Immediately upon 
certification by the Secretary that a community is eligible for 
assistance under subsection (b), the Secretary shall notify the 
community--
            ``(1) of the determination under subsection (b);
            ``(2) of the provisions of this chapter;
            ``(3) how to access the clearinghouse established by the 
        Department of Commerce regarding available economic assistance;
            ``(4) how to obtain technical assistance provided under 
        section 272(c)(3); and
            ``(5) how to obtain grants, tax credits, low income loans, 
        and other appropriate economic assistance.

``SEC. 274. STRATEGIC PLANS.

    ``(a) In General.--An eligible community may develop a strategic 
plan for community economic adjustment and diversification.
    ``(b) Requirements for Strategic Plan.--A strategic plan shall 
contain, at a minimum, the following:
            ``(1) A description and justification of the capacity for 
        economic adjustment, including the method of financing to be 
        used.
            ``(2) A description of the commitment of the community to 
        the strategic plan over the long term and the participation and 
        input of groups affected by economic dislocation.
            ``(3) A description of the projects to be undertaken by the 
        eligible community.
            ``(4) A description of how the plan and the projects to be 
        undertaken by the eligible community will lead to job creation 
        and job retention in the community.
            ``(5) A description of how the plan will achieve economic 
        adjustment and diversification.
            ``(6) A description of how the plan and the projects will 
        contribute to establishing or maintaining a level of public 
        services necessary to attract and retain economic investment.
            ``(7) A description and justification for the cost and 
        timing of proposed basic and advanced infrastructure 
        improvements in the eligible community.
            ``(8) A description of how the plan will address the 
        occupational and workforce conditions in the eligible 
        community.
            ``(9) A description of the educational programs available 
        for workforce training and future employment needs.
            ``(10) A description of how the plan will adapt to changing 
        markets and business cycles.
            ``(11) A description and justification for the cost and 
        timing of the total funds required by the community for 
        economic assistance.
            ``(12) A graduation strategy through which the eligible 
        community demonstrates that the community will terminate the 
        need for Federal assistance.
    ``(c) Grants To Develop Strategic Plans.--The Secretary, upon 
receipt of an application from an eligible community, may award a grant 
to that community to be used to develop the strategic plan.
    ``(d) Submission of Plan.--A strategic plan developed under 
subsection (a) shall be submitted to the Secretary for evaluation and 
approval.

``SEC. 275. GRANTS FOR ECONOMIC DEVELOPMENT.

    ``(a) In General.--The Secretary, upon approval of a strategic plan 
from an eligible community, may award a grant to that community to 
carry out any project or program that is certified by the Secretary to 
be included in the strategic plan approved under section 274(d), or 
consistent with that plan.
    ``(b) Additional Grants.--
            ``(1) In general.--Subject to paragraph (2), in order to 
        assist eligible communities to obtain funds under Federal grant 
        programs, other than the grants provided for in section 274(c) 
        or subsection (a), the Secretary may, on the application of an 
        eligible community, make a supplemental grant to the community 
        if--
                    ``(A) the purpose of the grant program from which 
                the grant is made is to provide technical or other 
                assistance for planning, constructing, or equipping 
                public works facilities or to provide assistance for 
                public service projects; and
                    ``(B) the grant is one for which the community is 
                eligible except for the community's inability to meet 
                the non-Federal share requirements of the grant 
                program.
            ``(2) Use as non-federal share.--A supplemental grant made 
        under this subsection may be used to provide the non-Federal 
        share of a project, unless the total Federal contribution to 
        the project for which the grant is being made exceeds 80 
        percent and that excess is not permitted by law.
    ``(c) Rural Community Preference.--The Secretary shall develop 
guidelines to ensure that rural communities receive preference in the 
allocation of resources.

``SEC. 276. GENERAL PROVISIONS.

    ``(a) Regulations.--The Secretary shall prescribe such regulations 
as are necessary to carry out the provisions of this chapter. Before 
implementing any regulation or guideline proposed by the Secretary with 
respect to this chapter, the Secretary shall submit the regulation or 
guideline to the Committee on Finance of the Senate and the Committee 
on Ways and Means of the House of Representatives for approval.
    ``(b) Supplement Not Supplant.--Funds appropriated under this 
chapter shall be used to supplement and not supplant other Federal, 
State, and local public funds expended to provide economic development 
assistance for communities.
    ``(c) Authorization of Appropriations.--There are authorized to be 
appropriated to the Secretary $100,000,000 for each of fiscal years 
2005 through 2008, to carry out this chapter. Amounts appropriated 
pursuant to this subsection shall remain available until expended.''.

SEC. 344. CONFORMING AMENDMENTS.

    (a) Termination.--Section 285(b) of the Trade Act of 1974 (19 
U.S.C. 2271 note) is amended by adding at the end the following new 
paragraph:
            ``(3) Assistance for communities.--Technical assistance and 
        other payments may not be provided under chapter 4 after 
        September 30, 2008.''.
    (b) Table of Contents.--The table of contents for title II of the 
Trade Act of 1974 is amended by striking the items relating to chapter 
4 of title II and inserting after the items relating to chapter 3 the 
following new items:

        ``Chapter 4--Trade Adjustment Assistance for Communities

        ``Sec. 271. Definitions.
        ``Sec. 272. Community Trade Adjustment Assistance Program.
        ``Sec. 273. Certification and notification.
        ``Sec. 274. Strategic plans.
        ``Sec. 275. Grants for economic development.
        ``Sec. 276. General provisions.''.
    (c) Judicial Review.--Section 284(a) of the Trade Act of 1974 (19 
U.S.C. 2395(a)) is amended by striking ``section 271'' and inserting 
``section 273''.

SEC. 345. EFFECTIVE DATE.

    The amendments made by this chapter shall take effect on the date 
of enactment of this Act.

            CHAPTER 3--OFFICE OF TRADE ADJUSTMENT ASSISTANCE

SEC. 351. SHORT TITLE.

    This chapter may be cited as the ``Trade Adjustment Assistance for 
Firms Reorganization Act''.

SEC. 352. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

    (a) In General.--Chapter 3 of title II of the Trade Act of 1974 (19 
U.S.C. 2341 et seq.) is amended by inserting after section 255 the 
following new section:

``SEC. 255A. OFFICE OF TRADE ADJUSTMENT ASSISTANCE.

    ``(a) Establishment.--Not later than 90 days after the date of 
enactment of the Trade Adjustment Assistance for Firms Reorganization 
Act, there shall be established in the International Trade 
Administration of the Department of Commerce an Office of Trade 
Adjustment Assistance.
    ``(b) Personnel.--The Office shall be headed by a Director, and 
shall have such staff as may be necessary to carry out the 
responsibilities of the Secretary of Commerce described in this 
chapter.
    ``(c) Functions.--The Office shall assist the Secretary of Commerce 
in carrying out the Secretary's responsibilities under this chapter.''.
    (b) Conforming Amendment.--The table of contents for the Trade Act 
of 1974 is amended by inserting after the item relating to section 255, 
the following new item:

``Sec. 255A. Office of Trade Adjustment Assistance.''.

SEC. 353. EFFECTIVE DATE.

    The amendments made by this chapter shall take effect on the date 
of enactment of this Act.

CHAPTER 4--IMPROVEMENT OF CREDIT FOR HEALTH INSURANCE COSTS OF ELIGIBLE 
                              INDIVIDUALS

SEC. 361. IMPROVEMENT OF THE AFFORDABILITY OF THE CREDIT.

    (a) Improvement of Affordability.--
            (1) In General.--Section 35(a) of the Internal Revenue Code 
        of 1986 (relating to credit for health insurance costs of 
        eligible individuals) is amended to read as follows:
    ``(a) Amount of Credit.--
            ``(1) In general.--In the case of an individual, there 
        shall be allowed as a credit against the tax imposed by 
        subtitle A an amount equal to the excess of--
                    ``(A) the amount paid by the taxpayer for coverage 
                of the taxpayer and qualifying family members under 
                qualified health insurance for eligible coverage months 
                beginning in the taxable year, over
                    ``(B) the amount described in paragraph (2).
            ``(2) Amount described.--For purposes of paragraph (1), the 
        amount described in this paragraph is the lesser of--
                    ``(A) the amount equal to 20 percent of the amount 
                determined under paragraph (1)(A) for the taxable year, 
                or
                    ``(B) the amount equal to 5 percent of the 
                taxpayer's certified income (as determined under 
                subsection (g)(9)) for such taxable year.''.
            (2) Conforming amendment.--Section 7527(b) of such Code 
        (relating to advance payment of credit for health insurance 
        costs of eligible individuals) is amended by striking ``65 
        percent of the amount'' and all that follows through the period 
        at the end and inserting ``the amount determined under section 
        35(a)(1) for such taxable year.''.
    (b) Determination of Certified Income.--Section 35(g) of such Code 
(relating to special rules), is amended--
            (1) by redesignating paragraph (9) as paragraph (10), and
            (2) by inserting after paragraph (8) the following new 
        paragraph:
            ``(9) Certified income.--
                    ``(A) In general.--The Secretary shall enter into 
                agreements with States to determine an individual's 
                certified income for purposes of subsection (a)(2)(B) 
                for any taxable year.
                    ``(B) Requirements.--An agreement under 
                subparagraph (A) with a State shall--
                            ``(i) permit an individual to complete an 
                        application for certification of income for a 
                        taxable year (in such form and manner as the 
                        Secretary shall determine) and to submit the 
                        application to the State,
                            ``(ii) require the State to determine the 
                        individual's income for the taxable year on the 
                        basis of the individual's monthly family income 
                        as of the month preceding the month in which 
                        the application is submitted, and
                            ``(iii) require the State to issue a 
                        certification of income to the individual upon 
                        receipt of an application under clause (i), 
                        which shall apply for purposes of determining 
                        the taxpayer's certified income for purposes of 
                        subsection (a)(2)(B) for the taxable year 
                        unless the State determines upon completion of 
                        the processing of the application that the 
                        certification is erroneous.
                    ``(C) Notification of change in income.--An 
                individual issued a certification of income shall 
                notify the State of any substantial change in income 
                that applies for at least 60 days and the taxpayer's 
                certified income for the taxable year shall be adjusted 
                accordingly. An individual who fails to so notify the 
                State shall remit the difference (if any) between the 
                amount described in subsection (a)(2) for the taxable 
                year and such amount which would have been described 
                under such subsection for such taxable year if the 
                notification had been made as an addition to tax, plus 
                interest at the underpayment rate established under 
                section 6621.''.
    (c) Effective Date.--The amendments made by this section apply to 
taxable years beginning after December 31, 2004.

SEC. 362. OFFERING OF FEDERAL FALLBACK COVERAGE.

    (a) Provision of Fallback Coverage.--
            (1) In general.--The Director of the Office of Personnel 
        Management jointly with the Secretary of the Treasury shall 
        establish a program under which eligible individuals (as 
        defined in section 35(c) of the Internal Revenue Code of 1986) 
        are offered enrollment under health benefit plans that are made 
        available under FEHBP.
            (2) Terms and conditions.--The terms and conditions of 
        health benefits plans offered under paragraph (1) shall be the 
        same as the terms and coverage offered under FEHBP, except that 
        the percentage of the premium charged to eligible individuals 
        (as so defined) for such health benefit plans shall be equal to 
        the percentage that an employee would be required to contribute 
        for coverage under FEHBP.
            (3) Study.--The Director of the Office of Personnel 
        Management jointly with the Secretary of the Treasury shall 
        conduct a study of the impact of the offering of health benefit 
        plans under this subsection on the terms and conditions, 
        including premiums, for health benefit plans offered under 
        FEHBP and shall submit to Congress, not later than 2 years 
        after the date of the enactment of this Act, a report on such 
        study. Such report may contain such recommendations regarding 
        the establishment of separate risk pools for individuals 
        covered under FEHBP and eligible individuals covered under 
        health benefit plans offered under paragraph (1) as may be 
        appropriate to protect the interests of individuals covered 
        under FEHBP and alleviate any adverse impact on FEHBP that may 
        result from the offering of such health benefit plans.
            (4) FEHBP defined.--In this section, the term ``FEHBP'' 
        means the Federal Employees Health Benefits Program offered 
        under chapter 89 of title 5, United States Code.
    (b) Conforming Amendments.--
            (1) Paragraph (1) of section 35(e) of the Internal Revenue 
        Code of 1986 is amended by adding at the end the following new 
        subparagraph:
                    ``(K) Coverage under a health benefits plan offered 
                under section 362(a)(1) of the Fair Wage, Competition, 
                and Investment Act of 2005.''.
            (2) Section 173(f)(2)(A) of the Workforce Investment Act of 
        1998 (29 U.S.C. 2918(f)(2)(A)) is amended by adding at the end 
        the following new clause:
                            ``(xi) Coverage under a health benefits 
                        plan offered under section 362(a)(1) of the 
                        Fair Wage, Competition, and Investment Act of 
                        2005.''.

SEC. 363. CLARIFICATION OF ELIGIBILITY OF SPOUSE OF CERTAIN INDIVIDUALS 
              ENTITLED TO MEDICARE.

    (a) In General.--Subsection (b) of section 35 of the Internal 
Revenue Code of 1986 (defining eligible coverage month) is amended by 
adding at the end the following:
            ``(3)  Special rule for spouse of individual entitled to 
        medicare.--Any month which would be an eligible coverage month 
        with respect to a taxpayer (determined without regard to 
        subsection (f)(2)(A)) shall be an eligible coverage month for 
        any spouse of such taxpayer.''.
    (b) Conforming Amendment.--Section 173(f)(5)(A)(i) of the Workforce 
Investment Act of 1998 (29 U.S.C. 2918(f)(5)(A)(i)) is amended by 
inserting ``(including with respect to any month for which the eligible 
individual would have been treated as such but for the application of 
paragraph (7)(B)(i))'' before the comma.

        Subtitle D--Sense of the Senate on Free Trade Agreements

SEC. 371. SENSE OF THE SENATE ON FREE TRADE AGREEMENTS.

    (a) Findings.--The Senate makes the following findings:
            (1) The United States is participating in the Doha Round of 
        World Trade Organization (``WTO'') negotiations, which seeks to 
        lower trade barriers for all members of the WTO.
            (2) In addition to participating in the Doha Round of WTO 
        negotiations, the United States is negotiating bilateral free 
        trade agreements with 20 countries.
            (3) Only 1 of those 20 countries is among the top 30 
        trading partners of the United States.
            (4) During the debate on the legislation that was enacted 
        as the Trade Act of 2002 (Public Law 107-210; 116 Stat. 933), a 
        representative of the President argued that ``[i]ncreased trade 
        will help our workers, farmers, businesses, and economy by 
        enhancing employment opportunities, opening more markets to 
        American goods and services, and increasing choices and 
        lowering costs for consumers''.
            (5) During that debate and on other occasions, the 
        President and individuals in the Executive Branch of the United 
        States have repeatedly argued that increased trade means an 
        increase in the number of jobs in the United States and a 
        higher standard of living for people in the United States.
            (6) The President and individuals in the Executive Branch 
        of the United States have also argued that trade expands 
        markets for United States goods and services, creates higher-
        paying jobs in the United States, and invigorates local 
        communities and their economies.
            (7) Trade agreements between the United States and 
        countries with small economies have little impact on creating 
        jobs in the United States or a higher standard of living for 
        people in the United States.
    (b) Sense of the Senate.--It is the sense of the Senate that--
            (1) the trade policy of the United States should focus on 
        creating more jobs in the United States and a higher standard 
        of living for people in the United States; and
            (2) to best accomplish these goals, the United States 
        should focus its efforts on trade negotiations occurring at the 
        WTO and, when negotiating trade agreements on a bilateral 
        basis, focus on agreements with countries that have large 
        economies that will provide meaningful export opportunities for 
        United States farmers, workers, and businesses.
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