S10340 CONGRESSIONAL RECORD — SENATE October 1, 2008 

respect to health insurance and employment, 

and for other purposes; which was ordered to 

lie on the table. 

f 

TEXT OF AMENDMENTS 

SA 5683. Mr. BINGAMAN (for Mr. 

DORGAN (for himself, Mr. BINGAMAN, 

Mr. AKAKA, Mr. HARKIN, Mr. FEINGOLD, 

Mrs. BOXER, Mr. BYRD, Mr. SANDERS, 

and Mrs. FEINSTEIN)) proposed an 

amendment to the bill H.R. 7081, to approve the United States-India Agreement for Cooperation on Peaceful Uses 

of Nuclear Energy, and for other purposes; as follows: 

At the end of title I, add the following: 

SEC. 106. PROHIBITION OF NUCLEAR TRADE IN 

EVENT OF NUCLEAR WEAPON DETONATION BY INDIA. 

Notwithstanding any other provision of 

law, the United States may not export, 

transfer, or retransfer any nuclear technology, material, equipment, or facility 

under the Agreement if the Government of 

India detonates a nuclear explosive device 

after the date of the enactment of this Act. 

SEC. 107. CERTIFICATION, REPORTING, AND CONTROL REQUIREMENTS IN EVENT OF 

NUCLEAR WEAPON DETONATION BY 

INDIA. 

In the event the Government of India detonates a nuclear weapon after the date of the 

enactment of this Act, the President shall— 

(1) certify to Congress that no United 

States technology, material, equipment, or 

facility supplied to India under the Agreement assisted with such detonation; 

(2) not later than 60 days after such detonation, submit to Congress a report describing United States nuclear related export controls that could be utilized with respect to 

countries that continue nuclear trade with 

India to minimize any potential contribution 

by United States exports to the nuclear 

weapons program of the Government of 

India; and 

(3) fully utilize such export controls unless, 

not later than 120 days after such detonation, Congress adopts, and there is enacted, a 

joint resolution disapproving of the full utilization of such export controls. 

SA 5684. Mr. DODD (for Mr. PRYOR) 

proposed an amendment to the bill S. 

602, to develop the next generation of 

parental control technology; as follows: 

On page 6, beginning in line 4, strike 

‘‘TECHNOLOGIES.’’ and insert ‘‘TECHNOLOGIES AND EXISTING PARENTAL EMPOWERMENT TOOLS.’’. 

On page 6, line 12, strike ‘‘and’’. 

On page 6, line 16, strike ‘‘offering.’’ and 

insert ‘‘offering; and’’. 

On page 6, between lines 16 and 17, insert 

the following: 

‘‘(3) the existence, availability, and use of 

parental empowerment tools and initiatives 

already in the market.’’. 

SA 5685. Mr. DODD proposed an 

amendment to the bill H.R. 1424, of 

1974, section 2705 of the Public Health 

Service Act, section 9812 of the Internal Revenue Code of 1986 to require equity in the provision of mental health 

and substance-related disorder benefits 

under group health plans, to prohibit 

discrimination on the basis of genetic 

information with respect to health insurance and employment, and for other 

purposes; as follows: 

Strike all after the enacting clause and insert the following: 

DIVISION A—EMERGENCY ECONOMIC 

STABILIZATION 

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS. 

(a) SHORT TITLE.—This division may be 

cited as the ‘‘Emergency Economic Stabilization Act of 2008’’. 

(b) TABLE OF CONTENTS.—The table of contents for this division is as follows: 

Sec. 1. Short title and table of contents. 

Sec. 2. Purposes. 

Sec. 3. Definitions. 

TITLE I—TROUBLED ASSETS RELIEF 

PROGRAM 

Sec. 101. Purchases of troubled assets. 

Sec. 102. Insurance of troubled assets. 

Sec. 103. Considerations. 

Sec. 104. Financial Stability Oversight 

Board. 

Sec. 105. Reports. 

Sec. 106. Rights; management; sale of troubled assets; revenues and sale 

proceeds. 

Sec. 107. Contracting procedures. 

Sec. 108. Conflicts of interest. 

Sec. 109. Foreclosure mitigation efforts. 

Sec. 110. Assistance to homeowners. 

Sec. 111. Executive compensation and corporate governance. 

Sec. 112. Coordination with foreign authorities and central banks. 

Sec. 113. Minimization of long-term costs 

and maximization of benefits 

for taxpayers. 

Sec. 114. Market transparency. 

Sec. 115. Graduated authorization to purchase. 

Sec. 116. Oversight and audits. 

Sec. 117. Study and report on margin authority. 

Sec. 118. Funding. 

Sec. 119. Judicial review and related matters. 

Sec. 120. Termination of authority. 

Sec. 121. Special Inspector General for the 

Troubled Asset Relief Program. 

Sec. 122. Increase in statutory limit on the 

public debt. 

Sec. 123. Credit reform. 

Sec. 124. HOPE for Homeowners amendments. 

Sec. 125. Congressional Oversight Panel. 

Sec. 126. FDIC authority. 

Sec. 127. Cooperation with the FBI. 

Sec. 128. Acceleration of effective date. 

Sec. 129. Disclosures on exercise of loan authority. 

Sec. 130. Technical corrections. 

Sec. 131. Exchange Stabilization Fund reimbursement. 

Sec. 132. Authority to suspend mark-to-market accounting. 

Sec. 133. Study on mark-to-market accounting. 

Sec. 134. Recoupment. 

Sec. 135. Preservation of authority. 

Sec. 136. Temporary increase in deposit and 

share insurance coverage. 

TITLE II—BUDGET-RELATED 

PROVISIONS 

Sec. 201. Information for congressional support agencies. 

Sec. 202. Reports by the Office of Management and Budget and the Congressional Budget Office. 

Sec. 203. Analysis in President’s Budget. 

Sec. 204. Emergency treatment. 

TITLE III—TAX PROVISIONS 

Sec. 301. Gain or loss from sale or exchange 

of certain preferred stock. 

Sec. 302. Special rules for tax treatment of 

executive compensation of employers participating in the 

troubled assets relief program. 

Sec. 303. Extension of exclusion of income 

from discharge of qualified 

principal residence indebtedness. 

SEC. 2. PURPOSES. 

The purposes of this Act are— 

(1) to immediately provide authority and 

facilities that the Secretary of the Treasury 

can use to restore liquidity and stability to 

the financial system of the United States; 

and 

(2) to ensure that such authority and such 

facilities are used in a manner that— 

(A) protects home values, college funds, retirement accounts, and life savings; 

(B) preserves homeownership and promotes 

jobs and economic growth; 

(C) maximizes overall returns to the taxpayers of the United States; and 

(D) provides public accountability for the 

exercise of such authority. 

SEC. 3. DEFINITIONS. 

For purposes of this Act, the following 

definitions shall apply: 

(1) APPROPRIATE COMMITTEES OF CONGRESS.—The term ‘‘appropriate committees 

of Congress’’ means— 

(A) the Committee on Banking, Housing, 

and Urban Affairs, the Committee on Finance, the Committee on the Budget, and 

the Committee on Appropriations of the Senate; and 

(B) the Committee on Financial Services, 

the Committee on Ways and Means, the 

Committee on the Budget, and the Committee on Appropriations of the House of 

Representatives. 

(2) BOARD.—The term ‘‘Board’’ means the 

Board of Governors of the Federal Reserve 

System. 

(3) CONGRESSIONAL SUPPORT AGENCIES.—The 

term ‘‘congressional support agencies’’ 

means the Congressional Budget Office and 

the Joint Committee on Taxation. 

(4) CORPORATION.—The term ‘‘Corporation’’ 

means the Federal Deposit Insurance Corporation. 

(5) FINANCIAL INSTITUTION.—The term ‘‘financial institution’’ means any institution, 

including, but not limited to, any bank, savings association, credit union, security 

broker or dealer, or insurance company, established and regulated under the laws of the 

United States or any State, territory, or possession of the United States, the District of 

Columbia, Commonwealth of Puerto Rico, 

Commonwealth of Northern Mariana Islands, 

Guam, American Samoa, or the United 

States Virgin Islands, and having significant 

operations in the United States, but excluding any central bank of, or institution owned 

by, a foreign government. 

(6) FUND.—The term ‘‘Fund’’ means the 

Troubled Assets Insurance Financing Fund 

established under section 102. 

(7) SECRETARY.—The term ‘‘Secretary’’ 

means the Secretary of the Treasury. 

(8) TARP.—The term ‘‘TARP’’ means the 

Troubled Asset Relief Program established 

under section 101. 

(9) TROUBLED ASSETS.—The term ‘‘troubled 

assets’’ means— 

(A) residential or commercial mortgages 

and any securities, obligations, or other instruments that are based on or related to 

such mortgages, that in each case was originated or issued on or before March 14, 2008, 

the purchase of which the Secretary determines promotes financial market stability; 

and 

(B) any other financial instrument that 

the Secretary, after consultation with the 

Chairman of the Board of Governors of the 

Federal Reserve System, determines the purchase of which is necessary to promote financial market stability, but only upon 

transmittal of such determination, in writing, to the appropriate committees of Congress. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10341 

TITLE I—TROUBLED ASSETS RELIEF 

PROGRAM 

SEC. 101. PURCHASES OF TROUBLED ASSETS. 

(a) OFFICES; AUTHORITY.— 

(1) AUTHORITY.—The Secretary is authorized to establish the Troubled Asset Relief 

Program (or ‘‘TARP’’) to purchase, and to 

make and fund commitments to purchase, 

troubled assets from any financial institution, on such terms and conditions as are determined by the Secretary, and in accordance with this Act and the policies and procedures developed and published by the Secretary. 

(2) COMMENCEMENT OF PROGRAM.—Establishment of the policies and procedures and 

other similar administrative requirements 

imposed on the Secretary by this Act are not 

intended to delay the commencement of the 

TARP. 

(3) ESTABLISHMENT OF TREASURY OFFICE.— 

(A) IN GENERAL.—The Secretary shall implement any program under paragraph (1) 

through an Office of Financial Stability, established for such purpose within the Office 

of Domestic Finance of the Department of 

the Treasury, which office shall be headed by 

an Assistant Secretary of the Treasury, appointed by the President, by and with the advice and consent of the Senate, except that 

an interim Assistant Secretary may be appointed by the Secretary. 

(B) CLERICAL AMENDMENTS.— 

(i) TITLE 5.—Section 5315 of title 5, United 

States Code, is amended in the item relating 

to Assistant Secretaries of the Treasury, by 

striking ‘‘(9)’’ and inserting ‘‘(10)’’. 

(ii) TITLE 31.—Section 301(e) of title 31, 

United States Code, is amended by striking 

‘‘9’’ and inserting ‘‘10’’. 

(b) CONSULTATION.—In exercising the authority under this section, the Secretary 

shall consult with the Board, the Corporation, the Comptroller of the Currency, the 

Director of the Office of Thrift Supervision, 

the Chairman of the National Credit Union 

Administration Board, and the Secretary of 

Housing and Urban Development. 

(c) NECESSARY ACTIONS.—The Secretary is 

authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation, the following: 

(1) The Secretary shall have direct hiring 

authority with respect to the appointment of 

employees to administer this Act. 

(2) Entering into contracts, including contracts for services authorized by section 3109 

of title 5, United States Code. 

(3) Designating financial institutions as financial agents of the Federal Government, 

and such institutions shall perform all such 

reasonable duties related to this Act as financial agents of the Federal Government as 

may be required. 

(4) In order to provide the Secretary with 

the flexibility to manage troubled assets in a 

manner designed to minimize cost to the 

taxpayers, establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase, hold, and sell troubled 

assets and issue obligations. 

(5) Issuing such regulations and other guidance as may be necessary or appropriate to 

define terms or carry out the authorities or 

purposes of this Act. 

(d) PROGRAM GUIDELINES.—Before the earlier of the end of the 2-business-day period 

beginning on the date of the first purchase of 

troubled assets pursuant to the authority 

under this section or the end of the 45-day 

period beginning on the date of enactment of 

this Act, the Secretary shall publish program guidelines, including the following: 

(1) Mechanisms for purchasing troubled assets. 

(2) Methods for pricing and valuing troubled assets. 

(3) Procedures for selecting asset managers. 

(4) Criteria for identifying troubled assets 

for purchase. 

(e) PREVENTING UNJUST ENRICHMENT.—In 

making purchases under the authority of 

this Act, the Secretary shall take such steps 

as may be necessary to prevent unjust enrichment of financial institutions participating in a program established under this 

section, including by preventing the sale of a 

troubled asset to the Secretary at a higher 

price than what the seller paid to purchase 

the asset. This subsection does not apply to 

troubled assets acquired in a merger or acquisition, or a purchase of assets from a financial institution in conservatorship or receivership, or that has initiated bankruptcy 

proceedings under title 11, United States 

Code. 

SEC. 102. INSURANCE OF TROUBLED ASSETS. 

(a) AUTHORITY.— 

(1) IN GENERAL.—If the Secretary establishes the program authorized under section 

101, then the Secretary shall establish a program to guarantee troubled assets originated 

or issued prior to March 14, 2008, including 

mortgage-backed securities. 

(2) GUARANTEES.—In establishing any program under this subsection, the Secretary 

may develop guarantees of troubled assets 

and the associated premiums for such guarantees. Such guarantees and premiums may 

be determined by category or class of the 

troubled assets to be guaranteed. 

(3) EXTENT OF GUARANTEE.—Upon request 

of a financial institution, the Secretary may 

guarantee the timely payment of principal 

of, and interest on, troubled assets in 

amounts not to exceed 100 percent of such 

payments. Such guarantee may be on such 

terms and conditions as are determined by 

the Secretary, provided that such terms and 

conditions are consistent with the purposes 

of this Act. 

(b) REPORTS.—Not later than 90 days after 

the date of enactment of this Act, the Secretary shall report to the appropriate committees of Congress on the program established under subsection (a). 

(c) PREMIUMS.— 

(1) IN GENERAL.—The Secretary shall collect premiums from any financial institution 

participating in the program established 

under subsection (a). Such premiums shall be 

in an amount that the Secretary determines 

necessary to meet the purposes of this Act 

and to provide sufficient reserves pursuant 

to paragraph (3). 

(2) AUTHORITY TO BASE PREMIUMS ON PRODUCT RISK.—In establishing any premium 

under paragraph (1), the Secretary may provide for variations in such rates according to 

the credit risk associated with the particular 

troubled asset that is being guaranteed. The 

Secretary shall publish the methodology for 

setting the premium for a class of troubled 

assets together with an explanation of the 

appropriateness of the class of assets for participation in the program established under 

this section. The methodology shall ensure 

that the premium is consistent with paragraph (3). 

(3) MINIMUM LEVEL.—The premiums referred to in paragraph (1) shall be set by the 

Secretary at a level necessary to create reserves sufficient to meet anticipated claims, 

based on an actuarial analysis, and to ensure 

that taxpayers are fully protected. 

(4) ADJUSTMENT TO PURCHASE AUTHORITY.— 

The purchase authority limit in section 115 

shall be reduced by an amount equal to the 

difference between the total of the outstanding guaranteed obligations and the balance in the Troubled Assets Insurance Financing Fund. 

(d) TROUBLED ASSETS INSURANCE FINANCING

FUND.— 

(1) DEPOSITS.—The Secretary shall deposit 

fees collected under this section into the 

Fund established under paragraph (2). 

(2) ESTABLISHMENT.—There is established a 

Troubled Assets Insurance Financing Fund 

that shall consist of the amounts collected 

pursuant to paragraph (1), and any balance 

in such fund shall be invested by the Secretary in United States Treasury securities, 

or kept in cash on hand or on deposit, as necessary. 

(3) PAYMENTS FROM FUND.—The Secretary 

shall make payments from amounts deposited in the Fund to fulfill obligations of the 

guarantees provided to financial institutions 

under subsection (a). 

SEC. 103. CONSIDERATIONS. 

In exercising the authorities granted in 

this Act, the Secretary shall take into consideration— 

(1) protecting the interests of taxpayers by 

maximizing overall returns and minimizing 

the impact on the national debt; 

(2) providing stability and preventing disruption to financial markets in order to 

limit the impact on the economy and protect 

American jobs, savings, and retirement security; 

(3) the need to help families keep their 

homes and to stabilize communities; 

(4) in determining whether to engage in a 

direct purchase from an individual financial 

institution, the long-term viability of the financial institution in determining whether 

the purchase represents the most efficient 

use of funds under this Act; 

(5) ensuring that all financial institutions 

are eligible to participate in the program, 

without discrimination based on size, geography, form of organization, or the size, 

type, and number of assets eligible for purchase under this Act; 

(6) providing financial assistance to financial institutions, including those serving 

low- and moderate-income populations and 

other underserved communities, and that 

have assets less than $1,000,000,000, that were 

well or adequately capitalized as of June 30, 

2008, and that as a result of the devaluation 

of the preferred government-sponsored enterprises stock will drop one or more capital 

levels, in a manner sufficient to restore the 

financial institutions to at least an adequately capitalized level; 

(7) the need to ensure stability for United 

States public instrumentalities, such as 

counties and cities, that may have suffered 

significant increased costs or losses in the 

current market turmoil; 

(8) protecting the retirement security of 

Americans by purchasing troubled assets 

held by or on behalf of an eligible retirement 

plan described in clause (iii), (iv), (v), or (vi) 

of section 402(c)(8)(B) of the Internal Revenue Code of 1986, except that such authority 

shall not extend to any compensation arrangements subject to section 409A of such 

Code; and 

(9) the utility of purchasing other real estate owned and instruments backed by mortgages on multifamily properties. 

SEC. 104. FINANCIAL STABILITY OVERSIGHT 

BOARD. 

(a) ESTABLISHMENT.—There is established 

the Financial Stability Oversight Board, 

which shall be responsible for— 

(1) reviewing the exercise of authority 

under a program developed in accordance 

with this Act, including— 

(A) policies implemented by the Secretary 

and the Office of Financial Stability created 

under sections 101 and 102, including the appointment of financial agents, the designation of asset classes to be purchased, and 

plans for the structure of vehicles used to 

purchase troubled assets; and 


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S10342 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(B) the effect of such actions in assisting 

American families in preserving home ownership, stabilizing financial markets, and 

protecting taxpayers; 

(2) making recommendations, as appropriate, to the Secretary regarding use of the 

authority under this Act; and 

(3) reporting any suspected fraud, misrepresentation, or malfeasance to the Special Inspector General for the Troubled Assets Relief Program or the Attorney General 

of the United States, consistent with section 

535(b) of title 28, United States Code. 

(b) MEMBERSHIP.—The Financial Stability 

Oversight Board shall be comprised of— 

(1) the Chairman of the Board of Governors 

of the Federal Reserve System; 

(2) the Secretary; 

(3) the Director of the Federal Housing Finance Agency; 

(4) the Chairman of the Securities Exchange Commission; and 

(5) the Secretary of Housing and Urban Development. 

(c) CHAIRPERSON.—The chairperson of the 

Financial Stability Oversight Board shall be 

elected by the members of the Board from 

among the members other than the Secretary. 

(d) MEETINGS.—The Financial Stability 

Oversight Board shall meet 2 weeks after the 

first exercise of the purchase authority of 

the Secretary under this Act, and monthly 

thereafter. 

(e) ADDITIONAL AUTHORITIES.—In addition 

to the responsibilities described in subsection (a), the Financial Stability Oversight 

Board shall have the authority to ensure 

that the policies implemented by the Secretary are— 

(1) in accordance with the purposes of this 

Act; 

(2) in the economic interests of the United 

States; and 

(3) consistent with protecting taxpayers, in 

accordance with section 113(a). 

(f) CREDIT REVIEW COMMITTEE.—The Financial Stability Oversight Board may appoint a 

credit review committee for the purpose of 

evaluating the exercise of the purchase authority provided under this Act and the assets acquired through the exercise of such 

authority, as the Financial Stability Oversight Board determines appropriate. 

(g) REPORTS.—The Financial Stability 

Oversight Board shall report to the appropriate committees of Congress and the Congressional Oversight Panel established under 

section 125, not less frequently than quarterly, on the matters described under subsection (a)(1). 

(h) TERMINATION.—The Financial Stability 

Oversight Board, and its authority under 

this section, shall terminate on the expiration of the 15-day period beginning upon the 

later of— 

(1) the date that the last troubled asset acquired by the Secretary under section 101 has 

been sold or transferred out of the ownership 

or control of the Federal Government; or 

(2) the date of expiration of the last insurance contract issued under section 102. 

SEC. 105. REPORTS. 

(a) IN GENERAL.—Before the expiration of 

the 60-day period beginning on the date of 

the first exercise of the authority granted in 

section 101(a), or of the first exercise of the 

authority granted in section 102, whichever 

occurs first, and every 30-day period thereafter, the Secretary shall report to the appropriate committees of Congress, with respect to each such period— 

(1) an overview of actions taken by the 

Secretary, including the considerations required by section 103 and the efforts under 

section 109; 

(2) the actual obligation and expenditure of 

the funds provided for administrative expenses by section 118 during such period and 

the expected expenditure of such funds in the 

subsequent period; and 

(3) a detailed financial statement with respect to the exercise of authority under this 

Act, including— 

(A) all agreements made or renewed; 

(B) all insurance contracts entered into 

pursuant to section 102; 

(C) all transactions occurring during such 

period, including the types of parties involved; 

(D) the nature of the assets purchased; 

(E) all projected costs and liabilities; 

(F) operating expenses, including compensation for financial agents; 

(G) the valuation or pricing method used 

for each transaction; and 

(H) a description of the vehicles established to exercise such authority. 

(b) TRANCHE REPORTS TO CONGRESS.— 

(1) REPORTS.—The Secretary shall provide 

to the appropriate committees of Congress, 

at the times specified in paragraph (2), a 

written report, including— 

(A) a description of all of the transactions 

made during the reporting period; 

(B) a description of the pricing mechanism 

for the transactions; 

(C) a justification of the price paid for and 

other financial terms associated with the 

transactions; 

(D) a description of the impact of the exercise of such authority on the financial system, supported, to the extent possible, by 

specific data; 

(E) a description of challenges that remain 

in the financial system, including any benchmarks yet to be achieved; and 

(F) an estimate of additional actions under 

the authority provided under this Act that 

may be necessary to address such challenges. 

(2) TIMING.—The report required by this 

subsection shall be submitted not later than 

7 days after the date on which commitments 

to purchase troubled assets under the authorities provided in this Act first reach an 

aggregate of $50,000,000,000 and not later than 

7 days after each $50,000,000,000 interval of 

such commitments is reached thereafter. 

(c) REGULATORY MODERNIZATION REPORT.— 

The Secretary shall review the current state 

of the financial markets and the regulatory 

system and submit a written report to the 

appropriate committees of Congress not 

later than April 30, 2009, analyzing the current state of the regulatory system and its 

effectiveness at overseeing the participants 

in the financial markets, including the overthe-counter swaps market and governmentsponsored enterprises, and providing recommendations for improvement, including— 

(1) recommendations regarding— 

(A) whether any participants in the financial markets that are currently outside the 

regulatory system should become subject to 

the regulatory system; and 

(B) enhancement of the clearing and settlement of over-the-counter swaps; and 

(2) the rationale underlying such recommendations. 

(d) SHARING OF INFORMATION.—Any report 

required under this section shall also be submitted to the Congressional Oversight Panel 

established under section 125. 

(e) SUNSET.—The reporting requirements 

under this section shall terminate on the 

later of— 

(1) the date that the last troubled asset acquired by the Secretary under section 101 has 

been sold or transferred out of the ownership 

or control of the Federal Government; or 

(2) the date of expiration of the last insurance contract issued under section 102. 

SEC. 106. RIGHTS; MANAGEMENT; SALE OF TROUBLED ASSETS; REVENUES AND SALE 

PROCEEDS. 

(a) EXERCISE OF RIGHTS.—The Secretary 

may, at any time, exercise any rights received in connection with troubled assets 

purchased under this Act. 

(b) MANAGEMENT OF TROUBLED ASSETS.— 

The Secretary shall have authority to manage troubled assets purchased under this 

Act, including revenues and portfolio risks 

therefrom. 

(c) SALE OF TROUBLED ASSETS.—The Secretary may, at any time, upon terms and 

conditions and at a price determined by the 

Secretary, sell, or enter into securities 

loans, repurchase transactions, or other financial transactions in regard to, any troubled asset purchased under this Act. 

(d) TRANSFER TO TREASURY.—Revenues of, 

and proceeds from the sale of troubled assets 

purchased under this Act, or from the sale, 

exercise, or surrender of warrants or senior 

debt instruments acquired under section 113 

shall be paid into the general fund of the 

Treasury for reduction of the public debt. 

(e) APPLICATION OF SUNSET TO TROUBLED

ASSETS.—The authority of the Secretary to 

hold any troubled asset purchased under this 

Act before the termination date in section 

120, or to purchase or fund the purchase of a 

troubled asset under a commitment entered 

into before the termination date in section 

120, is not subject to the provisions of section 120. 

SEC. 107. CONTRACTING PROCEDURES. 

(a) STREAMLINED PROCESS.—For purposes 

of this Act, the Secretary may waive specific 

provisions of the Federal Acquisition Regulation upon a determination that urgent and 

compelling circumstances make compliance 

with such provisions contrary to the public 

interest. Any such determination, and the 

justification for such determination, shall be 

submitted to the Committees on Oversight 

and Government Reform and Financial Services of the House of Representatives and the 

Committees on Homeland Security and Governmental Affairs and Banking, Housing, and 

Urban Affairs of the Senate within 7 days. 

(b) ADDITIONAL CONTRACTING REQUIREMENTS.—In any solicitation or contract 

where the Secretary has, pursuant to subsection (a), waived any provision of the Federal Acquisition Regulation pertaining to 

minority contracting, the Secretary shall develop and implement standards and procedures to ensure, to the maximum extent 

practicable, the inclusion and utilization of 

minorities (as such term is defined in section 

1204(c) of the Financial Institutions Reform, 

Recovery, and Enforcement Act of 1989 (12 

U.S.C. 1811 note)) and women, and minorityand women-owned businesses (as such terms 

are defined in section 21A(r)(4) of the Federal 

Home Loan Bank Act (12 U.S.C. 1441a(r)(4)), 

in that solicitation or contract, including 

contracts to asset managers, servicers, property managers, and other service providers 

or expert consultants. 

(c) ELIGIBILITY OF FDIC.—Notwithstanding 

subsections (a) and (b), the Corporation— 

(1) shall be eligible for, and shall be considered in, the selection of asset managers for 

residential mortgage loans and residential 

mortgage-backed securities; and 

(2) shall be reimbursed by the Secretary for 

any services provided. 

SEC. 108. CONFLICTS OF INTEREST. 

(a) STANDARDS REQUIRED.—The Secretary 

shall issue regulations or guidelines necessary to address and manage or to prohibit 

conflicts of interest that may arise in connection with the administration and execution of the authorities provided under this 

Act, including— 

(1) conflicts arising in the selection or hiring of contractors or advisors, including 

asset managers; 

(2) the purchase of troubled assets; 

(3) the management of the troubled assets 

held; 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10343 

(4) post-employment restrictions on employees; and 

(5) any other potential conflict of interest, 

as the Secretary deems necessary or appropriate in the public interest. 

(b) TIMING.—Regulations or guidelines required by this section shall be issued as soon 

as practicable after the date of enactment of 

this Act. 

SEC. 109. FORECLOSURE MITIGATION EFFORTS. 

(a) RESIDENTIAL MORTGAGE LOAN SERVICING

STANDARDS.—To the extent that the Secretary acquires mortgages, mortgage backed 

securities, and other assets secured by residential real estate, including multifamily 

housing, the Secretary shall implement a 

plan that seeks to maximize assistance for 

homeowners and use the authority of the 

Secretary to encourage the servicers of the 

underlying mortgages, considering net 

present value to the taxpayer, to take advantage of the HOPE for Homeowners Program 

under section 257 of the National Housing 

Act or other available programs to minimize 

foreclosures. In addition, the Secretary may 

use loan guarantees and credit enhancements to facilitate loan modifications to 

prevent avoidable foreclosures. 

(b) COORDINATION.—The Secretary shall coordinate with the Corporation, the Board 

(with respect to any mortgage or mortgagebacked securities or pool of securities held, 

owned, or controlled by or on behalf of a 

Federal reserve bank, as provided in section 

110(a)(1)(C)), the Federal Housing Finance 

Agency, the Secretary of Housing and Urban 

Development, and other Federal Government 

entities that hold troubled assets to attempt 

to identify opportunities for the acquisition 

of classes of troubled assets that will improve the ability of the Secretary to improve 

the loan modification and restructuring 

process and, where permissible, to permit 

bona fide tenants who are current on their 

rent to remain in their homes under the 

terms of the lease. In the case of a mortgage 

on a residential rental property, the plan required under this section shall include protecting Federal, State, and local rental subsidies and protections, and ensuring any 

modification takes into account the need for 

operating funds to maintain decent and safe 

conditions at the property. 

(c) CONSENT TO REASONABLE LOAN MODIFICATION REQUESTS.—Upon any request arising under existing investment contracts, the 

Secretary shall consent, where appropriate, 

and considering net present value to the taxpayer, to reasonable requests for loss mitigation measures, including term extensions, 

rate reductions, principal write downs, increases in the proportion of loans within a 

trust or other structure allowed to be modified, or removal of other limitation on modifications. 

SEC. 110. ASSISTANCE TO HOMEOWNERS. 

(a) DEFINITIONS.—As used in this section— 

(1) the term ‘‘Federal property manager’’ 

means— 

(A) the Federal Housing Finance Agency, 

in its capacity as conservator of the Federal 

National Mortgage Association and the Federal Home Loan Mortgage Corporation; 

(B) the Corporation, with respect to residential mortgage loans and mortgage-backed 

securities held by any bridge depository institution pursuant to section 11(n) of the 

Federal Deposit Insurance Act; and 

(C) the Board, with respect to any mortgage or mortgage-backed securities or pool 

of securities held, owned, or controlled by or 

on behalf of a Federal reserve bank, other 

than mortgages or securities held, owned, or 

controlled in connection with open market 

operations under section 14 of the Federal 

Reserve Act (12 U.S.C. 353), or as collateral 

for an advance or discount that is not in default; 

(2) the term ‘‘consumer’’ has the same 

meaning as in section 103 of the Truth in 

Lending Act (15 U.S.C. 1602); 

(3) the term ‘‘insured depository institution’’ has the same meaning as in section 3 

of the Federal Deposit Insurance Act (12 

U.S.C. 1813); and 

(4) the term ‘‘servicer’’ has the same meaning as in section 6(i)(2) of the Real Estate 

Settlement Procedures Act of 1974 (12 U.S.C. 

2605(i)(2)). 

(b) HOMEOWNER ASSISTANCE BY AGENCIES.— 

(1) IN GENERAL.—To the extent that the 

Federal property manager holds, owns, or 

controls mortgages, mortgage backed securities, and other assets secured by residential 

real estate, including multifamily housing, 

the Federal property manager shall implement a plan that seeks to maximize assistance for homeowners and use its authority 

to encourage the servicers of the underlying 

mortgages, and considering net present value 

to the taxpayer, to take advantage of the 

HOPE for Homeowners Program under section 257 of the National Housing Act or other 

available programs to minimize foreclosures. 

(2) MODIFICATIONS.—In the case of a residential mortgage loan, modifications made 

under paragraph (1) may include— 

(A) reduction in interest rates; 

(B) reduction of loan principal; and 

(C) other similar modifications. 

(3) TENANT PROTECTIONS.—In the case of 

mortgages on residential rental properties, 

modifications made under paragraph (1) shall 

ensure— 

(A) the continuation of any existing Federal, State, and local rental subsidies and 

protections; and 

(B) that modifications take into account 

the need for operating funds to maintain decent and safe conditions at the property. 

(4) TIMING.—Each Federal property manager shall develop and begin implementation 

of the plan required by this subsection not 

later than 60 days after the date of enactment of this Act. 

(5) REPORTS TO CONGRESS.—Each Federal 

property manager shall, 60 days after the 

date of enactment of this Act and every 30 

days thereafter, report to Congress specific 

information on the number and types of loan 

modifications made and the number of actual foreclosures occurring during the reporting period in accordance with this section. 

(6) CONSULTATION.—In developing the plan 

required by this subsection, the Federal 

property managers shall consult with one 

another and, to the extent possible, utilize 

consistent approaches to implement the requirements of this subsection. 

(c) ACTIONS WITH RESPECT TO SERVICERS.— 

In any case in which a Federal property 

manager is not the owner of a residential 

mortgage loan, but holds an interest in obligations or pools of obligations secured by 

residential mortgage loans, the Federal 

property manager shall— 

(1) encourage implementation by the loan 

servicers of loan modifications developed 

under subsection (b); and 

(2) assist in facilitating any such modifications, to the extent possible. 

(d) LIMITATION.—The requirements of this 

section shall not supersede any other duty or 

requirement imposed on the Federal property managers under otherwise applicable 

law. 

SEC. 111. EXECUTIVE COMPENSATION AND CORPORATE GOVERNANCE. 

(a) APPLICABILITY.—Any financial institution that sells troubled assets to the Secretary under this Act shall be subject to the 

executive compensation requirements of subsections (b) and (c) and the provisions under 

the Internal Revenue Code of 1986, as provided under the amendment by section 302, 

as applicable. 

(b) DIRECT PURCHASES.— 

(1) IN GENERAL.—Where the Secretary determines that the purposes of this Act are 

best met through direct purchases of troubled assets from an individual financial institution where no bidding process or market 

prices are available, and the Secretary receives a meaningful equity or debt position 

in the financial institution as a result of the 

transaction, the Secretary shall require that 

the financial institution meet appropriate 

standards for executive compensation and 

corporate governance. The standards required under this subsection shall be effective for the duration of the period that the 

Secretary holds an equity or debt position in 

the financial institution. 

(2) CRITERIA.—The standards required 

under this subsection shall include— 

(A) limits on compensation that exclude 

incentives for senior executive officers of a 

financial institution to take unnecessary 

and excessive risks that threaten the value 

of the financial institution during the period 

that the Secretary holds an equity or debt 

position in the financial institution; 

(B) a provision for the recovery by the financial institution of any bonus or incentive 

compensation paid to a senior executive officer based on statements of earnings, gains, 

or other criteria that are later proven to be 

materially inaccurate; and 

(C) a prohibition on the financial institution making any golden parachute payment 

to its senior executive officer during the period that the Secretary holds an equity or 

debt position in the financial institution. 

(3) DEFINITION.—For purposes of this section, the term ‘‘senior executive officer’’ 

means an individual who is one of the top 5 

highly paid executives of a public company, 

whose compensation is required to be disclosed pursuant to the Securities Exchange 

Act of 1934, and any regulations issued thereunder, and non-public company counterparts. 

(c) AUCTION PURCHASES.—Where the Secretary determines that the purposes of this 

Act are best met through auction purchases 

of troubled assets, and only where such purchases per financial institution in the aggregate exceed $300,000,000 (including direct purchases), the Secretary shall prohibit, for 

such financial institution, any new employment contract with a senior executive officer 

that provides a golden parachute in the 

event of an involuntary termination, bankruptcy filing, insolvency, or receivership. 

The Secretary shall issue guidance to carry 

out this paragraph not later than 2 months 

after the date of enactment of this Act, and 

such guidance shall be effective upon 

issuance. 

(d) SUNSET.—The provisions of subsection 

(c) shall apply only to arrangements entered 

into during the period during which the authorities under section 101(a) are in effect, as 

determined under section 120. 

SEC. 112. COORDINATION WITH FOREIGN AUTHORITIES AND CENTRAL BANKS. 

The Secretary shall coordinate, as appropriate, with foreign financial authorities and 

central banks to work toward the establishment of similar programs by such authorities and central banks. To the extent that 

such foreign financial authorities or banks 

hold troubled assets as a result of extending 

financing to financial institutions that have 

failed or defaulted on such financing, such 

troubled assets qualify for purchase under 

section 101. 

SEC. 113. MINIMIZATION OF LONG-TERM COSTS 

AND MAXIMIZATION OF BENEFITS 

FOR TAXPAYERS. 

(a) LONG-TERM COSTS AND BENEFITS.— 

(1) MINIMIZING NEGATIVE IMPACT.—The Secretary shall use the authority under this Act 


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in a manner that will minimize any potential long-term negative impact on the taxpayer, taking into account the direct outlays, potential long-term returns on assets 

purchased, and the overall economic benefits 

of the program, including economic benefits 

due to improvements in economic activity 

and the availability of credit, the impact on 

the savings and pensions of individuals, and 

reductions in losses to the Federal Government. 

(2) AUTHORITY.—In carrying out paragraph 

(1), the Secretary shall— 

(A) hold the assets to maturity or for resale for and until such time as the Secretary 

determines that the market is optimal for 

selling such assets, in order to maximize the 

value for taxpayers; and 

(B) sell such assets at a price that the Secretary determines, based on available financial analysis, will maximize return on investment for the Federal Government. 

(3) PRIVATE SECTOR PARTICIPATION.—The 

Secretary shall encourage the private sector 

to participate in purchases of troubled assets, and to invest in financial institutions, 

consistent with the provisions of this section. 

(b) USE OF MARKET MECHANISMS.—In making purchases under this Act, the Secretary 

shall— 

(1) make such purchases at the lowest price 

that the Secretary determines to be consistent with the purposes of this Act; and 

(2) maximize the efficiency of the use of 

taxpayer resources by using market mechanisms, including auctions or reverse auctions, where appropriate. 

(c) DIRECT PURCHASES.—If the Secretary 

determines that use of a market mechanism 

under subsection (b) is not feasible or appropriate, and the purposes of the Act are best 

met through direct purchases from an individual financial institution, the Secretary 

shall pursue additional measures to ensure 

that prices paid for assets are reasonable and 

reflect the underlying value of the asset. 

(d) CONDITIONS ON PURCHASE AUTHORITY

FOR WARRANTS AND DEBT INSTRUMENTS.— 

(1) IN GENERAL.—The Secretary may not 

purchase, or make any commitment to purchase, any troubled asset under the authority of this Act, unless the Secretary receives 

from the financial institution from which 

such assets are to be purchased— 

(A) in the case of a financial institution, 

the securities of which are traded on a national securities exchange, a warrant giving 

the right to the Secretary to receive nonvoting common stock or preferred stock in 

such financial institution, or voting stock 

with respect to which, the Secretary agrees 

not to exercise voting power, as the Secretary determines appropriate; or 

(B) in the case of any financial institution 

other than one described in subparagraph 

(A), a warrant for common or preferred 

stock, or a senior debt instrument from such 

financial institution, as described in paragraph (2)(C). 

(2) TERMS AND CONDITIONS.—The terms and 

conditions of any warrant or senior debt instrument required under paragraph (1) shall 

meet the following requirements: 

(A) PURPOSES.—Such terms and conditions 

shall, at a minimum, be designed— 

(i) to provide for reasonable participation 

by the Secretary, for the benefit of taxpayers, in equity appreciation in the case of 

a warrant or other equity security, or a reasonable interest rate premium, in the case of 

a debt instrument; and 

(ii) to provide additional protection for the 

taxpayer against losses from sale of assets 

by the Secretary under this Act and the administrative expenses of the TARP. 

(B) AUTHORITY TO SELL, EXERCISE, OR SURRENDER.—The Secretary may sell, exercise, 

or surrender a warrant or any senior debt instrument received under this subsection, 

based on the conditions established under 

subparagraph (A). 

(C) CONVERSION.—The warrant shall provide that if, after the warrant is received by 

the Secretary under this subsection, the financial institution that issued the warrant 

is no longer listed or traded on a national securities exchange or securities association, 

as described in paragraph (1)(A), such warrants shall convert to senior debt, or contain 

appropriate protections for the Secretary to 

ensure that the Treasury is appropriately 

compensated for the value of the warrant, in 

an amount determined by the Secretary. 

(D) PROTECTIONS.—Any warrant representing securities to be received by the 

Secretary under this subsection shall contain anti-dilution provisions of the type employed in capital market transactions, as determined by the Secretary. Such provisions 

shall protect the value of the securities from 

market transactions such as stock splits, 

stock distributions, dividends, and other distributions, mergers, and other forms of reorganization or recapitalization. 

(E) EXERCISE PRICE.—The exercise price for 

any warrant issued pursuant to this subsection shall be set by the Secretary, in the 

interest of the taxpayers. 

(F) SUFFICIENCY.—The financial institution 

shall guarantee to the Secretary that it has 

authorized shares of nonvoting stock available to fulfill its obligations under this subsection. Should the financial institution not 

have sufficient authorized shares, including 

preferred shares that may carry dividend 

rights equal to a multiple number of common shares, the Secretary may, to the extent necessary, accept a senior debt note in 

an amount, and on such terms as will compensate the Secretary with equivalent value, 

in the event that a sufficient shareholder 

vote to authorize the necessary additional 

shares cannot be obtained. 

(3) EXCEPTIONS.— 

(A) DE MINIMIS.—The Secretary shall establish de minimis exceptions to the requirements of this subsection, based on the size of 

the cumulative transactions of troubled assets purchased from any one financial institution for the duration of the program, at 

not more than $100,000,000. 

(B) OTHER EXCEPTIONS.—The Secretary 

shall establish an exception to the requirements of this subsection and appropriate alternative requirements for any participating 

financial institution that is legally prohibited from issuing securities and debt instruments, so as not to allow circumvention of 

the requirements of this section. 

SEC. 114. MARKET TRANSPARENCY. 

(a) PRICING.—To facilitate market transparency, the Secretary shall make available 

to the public, in electronic form, a description, amounts, and pricing of assets acquired 

under this Act, within 2 business days of purchase, trade, or other disposition. 

(b) DISCLOSURE.—For each type of financial 

institutions that sells troubled assets to the 

Secretary under this Act, the Secretary shall 

determine whether the public disclosure required for such financial institutions with 

respect to off-balance sheet transactions, derivatives instruments, contingent liabilities, 

and similar sources of potential exposure is 

adequate to provide to the public sufficient 

information as to the true financial position 

of the institutions. If such disclosure is not 

adequate for that purpose, the Secretary 

shall make recommendations for additional 

disclosure requirements to the relevant regulators. 

SEC. 115. GRADUATED AUTHORIZATION TO PURCHASE. 

(a) AUTHORITY.—The authority of the Secretary to purchase troubled assets under this 

Act shall be limited as follows: 

(1) Effective upon the date of enactment of 

this Act, such authority shall be limited to 

$250,000,000,000 outstanding at any one time. 

(2) If at any time, the President submits to 

the Congress a written certification that the 

Secretary needs to exercise the authority 

under this paragraph, effective upon such 

submission, such authority shall be limited 

to $350,000,000,000 outstanding at any one 

time. 

(3) If, at any time after the certification in 

paragraph (2) has been made, the President 

transmits to the Congress a written report 

detailing the plan of the Secretary to exercise the authority under this paragraph, unless there is enacted, within 15 calendar days 

of such transmission, a joint resolution described in subsection (c), effective upon the 

expiration of such 15-day period, such authority shall be limited to $700,000,000,000 

outstanding at any one time. 

(b) AGGREGATION OF PURCHASE PRICES.— 

The amount of troubled assets purchased by 

the Secretary outstanding at any one time 

shall be determined for purposes of the dollar 

amount limitations under subsection (a) by 

aggregating the purchase prices of all troubled assets held. 

(c) JOINT RESOLUTION OF DISAPPROVAL.— 

(1) IN GENERAL.—Notwithstanding any 

other provision of this section, the Secretary 

may not exercise any authority to make purchases under this Act with regard to any 

amount in excess of $350,000,000,000 previously obligated, as described in this section if, within 15 calendar days after the date 

on which Congress receives a report of the 

plan of the Secretary described in subsection 

(a)(3), there is enacted into law a joint resolution disapproving the plan of the Secretary 

with respect to such additional amount. 

(2) CONTENTS OF JOINT RESOLUTION.—For 

the purpose of this section, the term ‘‘joint 

resolution’’ means only a joint resolution— 

(A) that is introduced not later than 3 calendar days after the date on which the report 

of the plan of the Secretary referred to in 

subsection (a)(3) is received by Congress; 

(B) which does not have a preamble; 

(C) the title of which is as follows: ‘‘Joint 

resolution relating to the disapproval of obligations under the Emergency Economic 

Stabilization Act of 2008’’; and 

(D) the matter after the resolving clause of 

which is as follows: ‘‘That Congress disapproves the obligation of any amount exceeding the amounts obligated as described 

in paragraphs (1) and (2) of section 115(a) of 

the Emergency Economic Stabilization Act 

of 2008.’’. 

(d) FAST TRACK CONSIDERATION IN HOUSE OF

REPRESENTATIVES.— 

(1) RECONVENING.—Upon receipt of a report 

under subsection (a)(3), the Speaker, if the 

House would otherwise be adjourned, shall 

notify the Members of the House that, pursuant to this section, the House shall convene 

not later than the second calendar day after 

receipt of such report; 

(2) REPORTING AND DISCHARGE.—Any committee of the House of Representatives to 

which a joint resolution is referred shall report it to the House not later than 5 calendar 

days after the date of receipt of the report 

described in subsection (a)(3). If a committee 

fails to report the joint resolution within 

that period, the committee shall be discharged from further consideration of the 

joint resolution and the joint resolution 

shall be referred to the appropriate calendar. 

(3) PROCEEDING TO CONSIDERATION.—After 

each committee authorized to consider a 

joint resolution reports it to the House or 


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has been discharged from its consideration, 

it shall be in order, not later than the sixth 

day after Congress receives the report described in subsection (a)(3), to move to proceed to consider the joint resolution in the 

House. All points of order against the motion 

are waived. Such a motion shall not be in 

order after the House has disposed of a motion to proceed on the joint resolution. The 

previous question shall be considered as ordered on the motion to its adoption without 

intervening motion. The motion shall not be 

debatable. A motion to reconsider the vote 

by which the motion is disposed of shall not 

be in order. 

(4) CONSIDERATION.—The joint resolution 

shall be considered as read. All points of 

order against the joint resolution and 

against its consideration are waived. The 

previous question shall be considered as ordered on the joint resolution to its passage 

without intervening motion except two 

hours of debate equally divided and controlled by the proponent and an opponent. A 

motion to reconsider the vote on passage of 

the joint resolution shall not be in order. 

(e) FAST TRACK CONSIDERATION IN SENATE.— 

(1) RECONVENING.—Upon receipt of a report 

under subsection (a)(3), if the Senate has adjourned or recessed for more than 2 days, the 

majority leader of the Senate, after consultation with the minority leader of the 

Senate, shall notify the Members of the Senate that, pursuant to this section, the Senate 

shall convene not later than the second calendar day after receipt of such message. 

(2) PLACEMENT ON CALENDAR.—Upon introduction in the Senate, the joint resolution 

shall be placed immediately on the calendar. 

(3) FLOOR CONSIDERATION.— 

(A) IN GENERAL.—Notwithstanding Rule 

XXII of the Standing Rules of the Senate, it 

is in order at any time during the period beginning on the 4th day after the date on 

which Congress receives a report of the plan 

of the Secretary described in subsection 

(a)(3) and ending on the 6th day after the 

date on which Congress receives a report of 

the plan of the Secretary described in subsection (a)(3) (even though a previous motion 

to the same effect has been disagreed to) to 

move to proceed to the consideration of the 

joint resolution, and all points of order 

against the joint resolution (and against 

consideration of the joint resolution) are 

waived. The motion to proceed is not debatable. The motion is not subject to a motion 

to postpone. A motion to reconsider the vote 

by which the motion is agreed to or disagreed to shall not be in order. If a motion 

to proceed to the consideration of the resolution is agreed to, the joint resolution shall 

remain the unfinished business until disposed of. 

(B) DEBATE.—Debate on the joint resolution, and on all debatable motions and appeals in connection therewith, shall be limited to not more than 10 hours, which shall 

be divided equally between the majority and 

minority leaders or their designees. A motion further to limit debate is in order and 

not debatable. An amendment to, or a motion to postpone, or a motion to proceed to 

the consideration of other business, or a motion to recommit the joint resolution is not 

in order. 

(C) VOTE ON PASSAGE.—The vote on passage 

shall occur immediately following the conclusion of the debate on a joint resolution, 

and a single quorum call at the conclusion of 

the debate if requested in accordance with 

the rules of the Senate. 

(D) RULINGS OF THE CHAIR ON PROCEDURE.— 

Appeals from the decisions of the Chair relating to the application of the rules of the 

Senate, as the case may be, to the procedure 

relating to a joint resolution shall be decided 

without debate. 

(f) RULES RELATING TO SENATE AND HOUSE

OF REPRESENTATIVES.— 

(1) COORDINATION WITH ACTION BY OTHER

HOUSE.—If, before the passage by one House 

of a joint resolution of that House, that 

House receives from the other House a joint 

resolution, then the following procedures 

shall apply: 

(A) The joint resolution of the other House 

shall not be referred to a committee. 

(B) With respect to a joint resolution of 

the House receiving the resolution— 

(i) the procedure in that House shall be the 

same as if no joint resolution had been received from the other House; but 

(ii) the vote on passage shall be on the 

joint resolution of the other House. 

(2) TREATMENT OF JOINT RESOLUTION OF

OTHER HOUSE.—If one House fails to introduce or consider a joint resolution under this 

section, the joint resolution of the other 

House shall be entitled to expedited floor 

procedures under this section. 

(3) TREATMENT OF COMPANION MEASURES.— 

If, following passage of the joint resolution 

in the Senate, the Senate then receives the 

companion measure from the House of Representatives, the companion measure shall 

not be debatable. 

(4) CONSIDERATION AFTER PASSAGE.— 

(A) IN GENERAL.—If Congress passes a joint 

resolution, the period beginning on the date 

the President is presented with the joint resolution and ending on the date the President 

takes action with respect to the joint resolution shall be disregarded in computing the 

15-calendar day period described in subsection (a)(3). 

(B) VETOES.—If the President vetoes the 

joint resolution— 

(i) the period beginning on the date the 

President vetoes the joint resolution and 

ending on the date the Congress receives the 

veto message with respect to the joint resolution shall be disregarded in computing the 

15-calendar day period described in subsection (a)(3), and 

(ii) debate on a veto message in the Senate 

under this section shall be 1 hour equally divided between the majority and minority 

leaders or their designees. 

(5) RULES OF HOUSE OF REPRESENTATIVES

AND SENATE.—This subsection and subsections (c), (d), and (e) are enacted by Congress— 

(A) as an exercise of the rulemaking power 

of the Senate and House of Representatives, 

respectively, and as such it is deemed a part 

of the rules of each House, respectively, but 

applicable only with respect to the procedure 

to be followed in that House in the case of a 

joint resolution, and it supersedes other 

rules only to the extent that it is inconsistent with such rules; and 

(B) with full recognition of the constitutional right of either House to change the 

rules (so far as relating to the procedure of 

that House) at any time, in the same manner, and to the same extent as in the case of 

any other rule of that House. 

SEC. 116. OVERSIGHT AND AUDITS. 

(a) COMPTROLLER GENERAL OVERSIGHT.— 

(1) SCOPE OF OVERSIGHT.—The Comptroller 

General of the United States shall, upon establishment of the troubled assets relief program under this Act (in this section referred 

to as the ‘‘TARP’’), commence ongoing oversight of the activities and performance of the 

TARP and of any agents and representatives 

of the TARP (as related to the agent or representative’s activities on behalf of or under 

the authority of the TARP), including vehicles established by the Secretary under this 

Act. The subjects of such oversight shall include the following: 

(A) The performance of the TARP in meeting the purposes of this Act, particularly 

those involving— 

(i) foreclosure mitigation; 

(ii) cost reduction; 

(iii) whether it has provided stability or 

prevented disruption to the financial markets or the banking system; and 

(iv) whether it has protected taxpayers. 

(B) The financial condition and internal 

controls of the TARP, its representatives 

and agents. 

(C) Characteristics of transactions and 

commitments entered into, including transaction type, frequency, size, prices paid, and 

all other relevant terms and conditions, and 

the timing, duration and terms of any future 

commitments to purchase assets. 

(D) Characteristics and disposition of acquired assets, including type, acquisition 

price, current market value, sale prices and 

terms, and use of proceeds from sales. 

(E) Efficiency of the operations of the 

TARP in the use of appropriated funds. 

(F) Compliance with all applicable laws 

and regulations by the TARP, its agents and 

representatives. 

(G) The efforts of the TARP to prevent, 

identify, and minimize conflicts of interest 

involving any agent or representative performing activities on behalf of or under the 

authority of the TARP. 

(H) The efficacy of contracting procedures 

pursuant to section 107(b), including, as applicable, the efforts of the TARP in evaluating proposals for inclusion and contracting 

to the maximum extent possible of minorities (as such term is defined in 1204(c) of the 

Financial Institutions Reform, Recovery, 

and Enhancement Act of 1989 (12 U.S.C. 1811 

note), women, and minority- and womenowned businesses, including ascertaining and 

reporting the total amount of fees paid and 

other value delivered by the TARP to all of 

its agents and representatives, and such 

amounts paid or delivered to such firms that 

are minority- and women-owned businesses 

(as such terms are defined in section 21A of 

the Federal Home Loan Bank Act (12 U.S.C. 

1441a)). 

(2) CONDUCT AND ADMINISTRATION OF OVERSIGHT.— 

(A) GAO PRESENCE.—The Secretary shall 

provide the Comptroller General with appropriate space and facilities in the Department 

of the Treasury as necessary to facilitate 

oversight of the TARP until the termination 

date established in section 120. 

(B) ACCESS TO RECORDS.—To the extent 

otherwise consistent with law, the Comptroller General shall have access, upon request, to any information, data, schedules, 

books, accounts, financial records, reports, 

files, electronic communications, or other 

papers, things, or property belonging to or in 

use by the TARP, or any vehicles established 

by the Secretary under this Act, and to the 

officers, directors, employees, independent 

public accountants, financial advisors, and 

other agents and representatives of the 

TARP (as related to the agent or representative’s activities on behalf of or under the authority of the TARP) or any such vehicle at 

such reasonable time as the Comptroller 

General may request. The Comptroller General shall be afforded full facilities for 

verifying transactions with the balances or 

securities held by depositaries, fiscal agents, 

and custodians. The Comptroller General 

may make and retain copies of such books, 

accounts, and other records as the Comptroller General deems appropriate. 

(C) REIMBURSEMENT OF COSTS.—The Treasury shall reimburse the Government Accountability Office for the full cost of any 

such oversight activities as billed therefor 

by the Comptroller General of the United 


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States. Such reimbursements shall be credited to the appropriation account ‘‘Salaries 

and Expenses, Government Accountability 

Office’’ current when the payment is received and remain available until expended. 

(3) REPORTING.—The Comptroller General 

shall submit reports of findings under this 

section, regularly and no less frequently 

than once every 60 days, to the appropriate 

committees of Congress, and the Special Inspector General for the Troubled Asset Relief 

Program established under this Act on the 

activities and performance of the TARP. The 

Comptroller may also submit special reports 

under this subsection as warranted by the 

findings of its oversight activities. 

(b) COMPTROLLER GENERAL AUDITS.— 

(1) ANNUAL AUDIT.—The TARP shall annually prepare and issue to the appropriate 

committees of Congress and the public audited financial statements prepared in accordance with generally accepted accounting 

principles, and the Comptroller General shall 

annually audit such statements in accordance with generally accepted auditing standards. The Treasury shall reimburse the Government Accountability Office for the full 

cost of any such audit as billed therefor by 

the Comptroller General. Such reimbursements shall be credited to the appropriation 

account ‘‘Salaries and Expenses, Government Accountability Office’’ current when 

the payment is received and remain available until expended. The financial statements prepared under this paragraph shall be 

on the fiscal year basis prescribed under section 1102 of title 31, United States Code. 

(2) AUTHORITY.—The Comptroller General 

may audit the programs, activities, receipts, 

expenditures, and financial transactions of 

the TARP and any agents and representatives of the TARP (as related to the agent or 

representative’s activities on behalf of or 

under the authority of the TARP), including 

vehicles established by the Secretary under 

this Act. 

(3) CORRECTIVE RESPONSES TO AUDIT PROBLEMS.—The TARP shall— 

(A) take action to address deficiencies 

identified by the Comptroller General or 

other auditor engaged by the TARP; or 

(B) certify to appropriate committees of 

Congress that no action is necessary or appropriate. 

(c) INTERNAL CONTROL.— 

(1) ESTABLISHMENT.—The TARP shall establish and maintain an effective system of 

internal control, consistent with the standards prescribed under section 3512(c) of title 

31, United States Code, that provides reasonable assurance of— 

(A) the effectiveness and efficiency of operations, including the use of the resources of 

the TARP; 

(B) the reliability of financial reporting, 

including financial statements and other reports for internal and external use; and 

(C) compliance with applicable laws and 

regulations. 

(2) REPORTING.—In conjunction with each 

annual financial statement issued under this 

section, the TARP shall— 

(A) state the responsibility of management 

for establishing and maintaining adequate 

internal control over financial reporting; and 

(B) state its assessment, as of the end of 

the most recent year covered by such financial statement of the TARP, of the effectiveness of the internal control over financial reporting. 

(d) SHARING OF INFORMATION.—Any report 

or audit required under this section shall 

also be submitted to the Congressional Oversight Panel established under section 125. 

(e) TERMINATION.—Any oversight, reporting, or audit requirement under this section 

shall terminate on the later of— 

(1) the date that the last troubled asset acquired by the Secretary under section 101 has 

been sold or transferred out of the ownership 

or control of the Federal Government; or 

(2) the date of expiration of the last insurance contract issued under section 102. 

SEC. 117. STUDY AND REPORT ON MARGIN AUTHORITY. 

(a) STUDY.—The Comptroller General shall 

undertake a study to determine the extent 

to which leverage and sudden deleveraging of 

financial institutions was a factor behind the 

current financial crisis. 

(b) CONTENT.—The study required by this 

section shall include— 

(1) an analysis of the roles and responsibilities of the Board, the Securities and Exchange Commission, the Secretary, and 

other Federal banking agencies with respect 

to monitoring leverage and acting to curtail 

excessive leveraging; 

(2) an analysis of the authority of the 

Board to regulate leverage, including by setting margin requirements, and what process 

the Board used to decide whether or not to 

use its authority; 

(3) an analysis of any usage of the margin 

authority by the Board; and 

(4) recommendations for the Board and appropriate committees of Congress with respect to the existing authority of the Board. 

(c) REPORT.—Not later than June 1, 2009, 

the Comptroller General shall complete and 

submit a report on the study required by this 

section to the Committee on Banking, Housing, and Urban Affairs of the Senate and the 

Committee on Financial Services of the 

House of Representatives. 

(d) SHARING OF INFORMATION.—Any reports 

required under this section shall also be submitted to the Congressional Oversight Panel 

established under section 125. 

SEC. 118. FUNDING. 

For the purpose of the authorities granted 

in this Act, and for the costs of administering those authorities, the Secretary 

may use the proceeds of the sale of any securities issued under chapter 31 of title 31, 

United States Code, and the purposes for 

which securities may be issued under chapter 

31 of title 31, United States Code, are extended to include actions authorized by this 

Act, including the payment of administrative expenses. Any funds expended or obligated by the Secretary for actions authorized by this Act, including the payment of 

administrative expenses, shall be deemed appropriated at the time of such expenditure or 

obligation. 

SEC. 119. JUDICIAL REVIEW AND RELATED MATTERS. 

(a) JUDICIAL REVIEW.— 

(1) STANDARD.—Actions by the Secretary 

pursuant to the authority of this Act shall 

be subject to chapter 7 of title 5, United 

States Code, including that such final actions shall be held unlawful and set aside if 

found to be arbitrary, capricious, an abuse of 

discretion, or not in accordance with law. 

(2) LIMITATIONS ON EQUITABLE RELIEF.— 

(A) INJUNCTION.—No injunction or other 

form of equitable relief shall be issued 

against the Secretary for actions pursuant 

to section 101, 102, 106, and 109, other than to 

remedy a violation of the Constitution. 

(B) TEMPORARY RESTRAINING ORDER.—Any 

request for a temporary restraining order 

against the Secretary for actions pursuant 

to this Act shall be considered and granted 

or denied by the court within 3 days of the 

date of the request. 

(C) PRELIMINARY INJUNCTION.—Any request 

for a preliminary injunction against the Secretary for actions pursuant to this Act shall 

be considered and granted or denied by the 

court on an expedited basis consistent with 

the provisions of rule 65(b)(3) of the Federal 

Rules of Civil Procedure, or any successor 

thereto. 

(D) PERMANENT INJUNCTION.—Any request 

for a permanent injunction against the Secretary for actions pursuant to this Act shall 

be considered and granted or denied by the 

court on an expedited basis. Whenever possible, the court shall consolidate trial on the 

merits with any hearing on a request for a 

preliminary injunction, consistent with the 

provisions of rule 65(a)(2) of the Federal 

Rules of Civil Procedure, or any successor 

thereto. 

(3) LIMITATION ON ACTIONS BY PARTICIPATING

COMPANIES.—No action or claims may be 

brought against the Secretary by any person 

that divests its assets with respect to its participation in a program under this Act, except as provided in paragraph (1), other than 

as expressly provided in a written contract 

with the Secretary. 

(4) STAYS.—Any injunction or other form 

of equitable relief issued against the Secretary for actions pursuant to section 101, 

102, 106, and 109, shall be automatically 

stayed. The stay shall be lifted unless the 

Secretary seeks a stay from a higher court 

within 3 calendar days after the date on 

which the relief is issued. 

(b) RELATED MATTERS.— 

(1) TREATMENT OF HOMEOWNERS’ RIGHTS.— 

The terms of any residential mortgage loan 

that is part of any purchase by the Secretary 

under this Act shall remain subject to all 

claims and defenses that would otherwise 

apply, notwithstanding the exercise of authority by the Secretary under this Act. 

(2) SAVINGS CLAUSE.—Any exercise of the 

authority of the Secretary pursuant to this 

Act shall not impair the claims or defenses 

that would otherwise apply with respect to 

persons other than the Secretary. Except as 

established in any contract, a servicer of 

pooled residential mortgages owes any duty 

to determine whether the net present value 

of the payments on the loan, as modified, is 

likely to be greater than the anticipated net 

recovery that would result from foreclosure 

to all investors and holders of beneficial interests in such investment, but not to any 

individual or groups of investors or beneficial interest holders, and shall be deemed 

to act in the best interests of all such investors or holders of beneficial interests if the 

servicer agrees to or implements a modification or workout plan when the servicer takes 

reasonable loss mitigation actions, including 

partial payments. 

SEC. 120. TERMINATION OF AUTHORITY. 

(a) TERMINATION.—The authorities provided under sections 101(a), excluding section 

101(a)(3), and 102 shall terminate on December 31, 2009. 

(b) EXTENSION UPON CERTIFICATION.—The 

Secretary, upon submission of a written certification to Congress, may extend the authority provided under this Act to expire not 

later than 2 years from the date of enactment of this Act. Such certification shall include a justification of why the extension is 

necessary to assist American families and 

stabilize financial markets, as well as the expected cost to the taxpayers for such an extension. 

SEC. 121. SPECIAL INSPECTOR GENERAL FOR 

THE TROUBLED ASSET RELIEF PROGRAM. 

(a) OFFICE OF INSPECTOR GENERAL.—There 

is hereby established the Office of the Special Inspector General for the Troubled Asset 

Relief Program. 

(b) APPOINTMENT OF INSPECTOR GENERAL; 

REMOVAL.—(1) The head of the Office of the 

Special Inspector General for the Troubled 

Asset Relief Program is the Special Inspector General for the Troubled Asset Relief 

Program (in this section referred to as the 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10347 

‘‘Special Inspector General’’), who shall be 

appointed by the President, by and with the 

advice and consent of the Senate. 

(2) The appointment of the Special Inspector General shall be made on the basis of integrity and demonstrated ability in accounting, auditing, financial analysis, law, management analysis, public administration, or 

investigations. 

(3) The nomination of an individual as Special Inspector General shall be made as soon 

as practicable after the establishment of any 

program under sections 101 and 102. 

(4) The Special Inspector General shall be 

removable from office in accordance with the 

provisions of section 3(b) of the Inspector 

General Act of 1978 (5 U.S.C. App.). 

(5) For purposes of section 7324 of title 5, 

United States Code, the Special Inspector 

General shall not be considered an employee 

who determines policies to be pursued by the 

United States in the nationwide administration of Federal law. 

(6) The annual rate of basic pay of the Special Inspector General shall be the annual 

rate of basic pay for an Inspector General 

under section 3(e) of the Inspector General 

Act of 1978 (5 U.S.C. App.). 

(c) DUTIES.—(1) It shall be the duty of the 

Special Inspector General to conduct, supervise, and coordinate audits and investigations of the purchase, management, and sale 

of assets by the Secretary of the Treasury 

under any program established by the Secretary under section 101, and the management by the Secretary of any program established under section 102, including by collecting and summarizing the following information: 

(A) A description of the categories of troubled assets purchased or otherwise procured 

by the Secretary. 

(B) A listing of the troubled assets purchased in each such category described under 

subparagraph (A). 

(C) An explanation of the reasons the Secretary deemed it necessary to purchase each 

such troubled asset. 

(D) A listing of each financial institution 

that such troubled assets were purchased 

from. 

(E) A listing of and detailed biographical 

information on each person or entity hired 

to manage such troubled assets. 

(F) A current estimate of the total amount 

of troubled assets purchased pursuant to any 

program established under section 101, the 

amount of troubled assets on the books of 

the Treasury, the amount of troubled assets 

sold, and the profit and loss incurred on each 

sale or disposition of each such troubled 

asset. 

(G) A listing of the insurance contracts 

issued under section 102. 

(2) The Special Inspector General shall establish, maintain, and oversee such systems, 

procedures, and controls as the Special Inspector General considers appropriate to discharge the duty under paragraph (1). 

(3) In addition to the duties specified in 

paragraphs (1) and (2), the Inspector General 

shall also have the duties and responsibilities of inspectors general under the Inspector General Act of 1978. 

(d) POWERS AND AUTHORITIES.—(1) In carrying out the duties specified in subsection 

(c), the Special Inspector General shall have 

the authorities provided in section 6 of the 

Inspector General Act of 1978. 

(2) The Special Inspector General shall 

carry out the duties specified in subsection 

(c)(1) in accordance with section 4(b)(1) of 

the Inspector General Act of 1978. 

(e) PERSONNEL, FACILITIES, AND OTHER RESOURCES.—(1) The Special Inspector General 

may select, appoint, and employ such officers and employees as may be necessary for 

carrying out the duties of the Special Inspector General, subject to the provisions of title 

5, United States Code, governing appointments in the competitive service, and the 

provisions of chapter 51 and subchapter III of 

chapter 53 of such title, relating to classification and General Schedule pay rates. 

(2) The Special Inspector General may obtain services as authorized by section 3109 of 

title 5, United States Code, at daily rates not 

to exceed the equivalent rate prescribed for 

grade GS–15 of the General Schedule by section 5332 of such title. 

(3) The Special Inspector General may 

enter into contracts and other arrangements 

for audits, studies, analyses, and other services with public agencies and with private 

persons, and make such payments as may be 

necessary to carry out the duties of the Inspector General. 

(4)(A) Upon request of the Special Inspector General for information or assistance 

from any department, agency, or other entity of the Federal Government, the head of 

such entity shall, insofar as is practicable 

and not in contravention of any existing law, 

furnish such information or assistance to the 

Special Inspector General, or an authorized 

designee. 

(B) Whenever information or assistance requested by the Special Inspector General is, 

in the judgment of the Special Inspector 

General, unreasonably refused or not provided, the Special Inspector General shall report the circumstances to the appropriate 

committees of Congress without delay. 

(f) REPORTS.—(1) Not later than 60 days 

after the confirmation of the Special Inspector General, and every calendar quarter 

thereafter, the Special Inspector General 

shall submit to the appropriate committees 

of Congress a report summarizing the activities of the Special Inspector General during 

the 120-day period ending on the date of such 

report. Each report shall include, for the period covered by such report, a detailed statement of all purchases, obligations, expenditures, and revenues associated with any program established by the Secretary of the 

Treasury under sections 101 and 102, as well 

as the information collected under subsection (c)(1). 

(2) Nothing in this subsection shall be construed to authorize the public disclosure of 

information that is— 

(A) specifically prohibited from disclosure 

by any other provision of law; 

(B) specifically required by Executive 

order to be protected from disclosure in the 

interest of national defense or national security or in the conduct of foreign affairs; or 

(C) a part of an ongoing criminal investigation. 

(3) Any reports required under this section 

shall also be submitted to the Congressional 

Oversight Panel established under section 

125. 

(g) FUNDING.—(1) Of the amounts made 

available to the Secretary of the Treasury 

under section 118, $50,000,000 shall be available to the Special Inspector General to 

carry out this section. 

(2) The amount available under paragraph 

(1) shall remain available until expended. 

(h) TERMINATION.—The Office of the Special 

Inspector General shall terminate on the 

later of— 

(1) the date that the last troubled asset acquired by the Secretary under section 101 has 

been sold or transferred out of the ownership 

or control of the Federal Government; or 

(2) the date of expiration of the last insurance contract issued under section 102. 

SEC. 122. INCREASE IN STATUTORY LIMIT ON THE 

PUBLIC DEBT. 

Subsection (b) of section 3101 of title 31, 

United States Code, is amended by striking 

out the dollar limitation contained in such 

subsection and inserting ‘‘$11,315,000,000,000’’. 

SEC. 123. CREDIT REFORM. 

(a) IN GENERAL.—Subject to subsection (b), 

the costs of purchases of troubled assets 

made under section 101(a) and guarantees of 

troubled assets under section 102, and any 

cash flows associated with the activities authorized in section 102 and subsections (a), 

(b), and (c) of section 106 shall be determined 

as provided under the Federal Credit Reform 

Act of 1990 (2 U.S.C. 661 et. seq.). 

(b) COSTS.—For the purposes of section 

502(5) of the Federal Credit Reform Act of 

1990 (2 U.S.C. 661a(5))— 

(1) the cost of troubled assets and guarantees of troubled assets shall be calculated by 

adjusting the discount rate in section 

502(5)(E) (2 U.S.C. 661a(5)(E)) for market 

risks; and 

(2) the cost of a modification of a troubled 

asset or guarantee of a troubled asset shall 

be the difference between the current estimate consistent with paragraph (1) under the 

terms of the troubled asset or guarantee of 

the troubled asset and the current estimate 

consistent with paragraph (1) under the 

terms of the troubled asset or guarantee of 

the troubled asset, as modified. 

SEC. 124. HOPE FOR HOMEOWNERS AMENDMENTS. 

Section 257 of the National Housing Act (12 

U.S.C. 1715z-23) is amended— 

(1) in subsection (e)— 

(A) in paragraph (1)(B), by inserting before 

‘‘a ratio’’ the following: ‘‘, or thereafter is 

likely to have, due to the terms of the mortgage being reset,’’; 

(B) in paragraph (2)(B), by inserting before 

the period at the end ‘‘(or such higher percentage as the Board determines, in the discretion of the Board)’’; 

(C) in paragraph (4)(A)— 

(i) in the first sentence, by inserting after 

‘‘insured loan’’ the following: ‘‘and any payments made under this paragraph,’’; and 

(ii) by adding at the end the following: 

‘‘Such actions may include making payments, which shall be accepted as payment 

in full of all indebtedness under the eligible 

mortgage, to any holder of an existing subordinate mortgage, in lieu of any future appreciation payments authorized under subparagraph (B).’’; and 

(2) in subsection (w), by inserting after 

‘‘administrative costs’’ the following: ‘‘and 

payments pursuant to subsection (e)(4)(A)’’. 

SEC. 125. CONGRESSIONAL OVERSIGHT PANEL. 

(a) ESTABLISHMENT.—There is hereby established the Congressional Oversight Panel 

(hereafter in this section referred to as the 

‘‘Oversight Panel’’) as an establishment in 

the legislative branch. 

(b) DUTIES.—The Oversight Panel shall review the current state of the financial markets and the regulatory system and submit 

the following reports to Congress: 

(1) REGULAR REPORTS.— 

(A) IN GENERAL.—Regular reports of the 

Oversight Panel shall include the following: 

(i) The use by the Secretary of authority 

under this Act, including with respect to the 

use of contracting authority and administration of the program. 

(ii) The impact of purchases made under 

the Act on the financial markets and financial institutions. 

(iii) The extent to which the information 

made available on transactions under the 

program has contributed to market transparency. 

(iv) The effectiveness of foreclosure mitigation efforts, and the effectiveness of the 

program from the standpoint of minimizing 

long-term costs to the taxpayers and maximizing the benefits for taxpayers. 

(B) TIMING.—The reports required under 

this paragraph shall be submitted not later 

than 30 days after the first exercise by the 


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S10348 CONGRESSIONAL RECORD — SENATE October 1, 2008 

Secretary of the authority under section 

101(a) or 102, and every 30 days thereafter. 

(2) SPECIAL REPORT ON REGULATORY REFORM.—The Oversight Panel shall submit a 

special report on regulatory reform not later 

than January 20, 2009, analyzing the current 

state of the regulatory system and its effectiveness at overseeing the participants in the 

financial system and protecting consumers, 

and providing recommendations for improvement, including recommendations regarding 

whether any participants in the financial 

markets that are currently outside the regulatory system should become subject to the 

regulatory system, the rationale underlying 

such recommendation, and whether there are 

any gaps in existing consumer protections. 

(c) MEMBERSHIP.— 

(1) IN GENERAL.—The Oversight Panel shall 

consist of 5 members, as follows: 

(A) 1 member appointed by the Speaker of 

the House of Representatives. 

(B) 1 member appointed by the minority 

leader of the House of Representatives. 

(C) 1 member appointed by the majority 

leader of the Senate. 

(D) 1 member appointed by the minority 

leader of the Senate. 

(E) 1 member appointed by the Speaker of 

the House of Representatives and the majority leader of the Senate, after consultation 

with the minority leader of the Senate and 

the minority leader of the House of Representatives. 

(2) PAY.—Each member of the Oversight 

Panel shall each be paid at a rate equal to 

the daily equivalent of the annual rate of 

basic pay for level I of the Executive Schedule for each day (including travel time) during which such member is engaged in the actual performance of duties vested in the 

Commission. 

(3) PROHIBITION OF COMPENSATION OF FEDERAL EMPLOYEES.—Members of the Oversight 

Panel who are full-time officers or employees of the United States or Members of Congress may not receive additional pay, allowances, or benefits by reason of their service 

on the Oversight Panel. 

(4) TRAVEL EXPENSES.—Each member shall 

receive travel expenses, including per diem 

in lieu of subsistence, in accordance with applicable provisions under subchapter I of 

chapter 57 of title 5, United States Code. 

(5) QUORUM.—Four members of the Oversight Panel shall constitute a quorum but a 

lesser number may hold hearings. 

(6) VACANCIES.—A vacancy on the Oversight Panel shall be filled in the manner in 

which the original appointment was made. 

(7) MEETINGS.—The Oversight Panel shall 

meet at the call of the Chairperson or a majority of its members. 

(d) STAFF.— 

(1) IN GENERAL.—The Oversight Panel may 

appoint and fix the pay of any personnel as 

the Commission considers appropriate. 

(2) EXPERTS AND CONSULTANTS.—The Oversight Panel may procure temporary and 

intermittent services under section 3109(b) of 

title 5, United States Code. 

(3) STAFF OF AGENCIES.—Upon request of 

the Oversight Panel, the head of any Federal 

department or agency may detail, on a reimbursable basis, any of the personnel of that 

department or agency to the Oversight Panel 

to assist it in carrying out its duties under 

this Act. 

(e) POWERS.— 

(1) HEARINGS AND SESSIONS.—The Oversight 

Panel may, for the purpose of carrying out 

this section, hold hearings, sit and act at 

times and places, take testimony, and receive evidence as the Panel considers appropriate and may administer oaths or affirmations to witnesses appearing before it. 

(2) POWERS OF MEMBERS AND AGENTS.—Any 

member or agent of the Oversight Panel 

may, if authorized by the Oversight Panel, 

take any action which the Oversight Panel is 

authorized to take by this section. 

(3) OBTAINING OFFICIAL DATA.—The Oversight Panel may secure directly from any department or agency of the United States information necessary to enable it to carry out 

this section. Upon request of the Chairperson 

of the Oversight Panel, the head of that department or agency shall furnish that information to the Oversight Panel. 

(4) REPORTS.—The Oversight Panel shall 

receive and consider all reports required to 

be submitted to the Oversight Panel under 

this Act. 

(f) TERMINATION.—The Oversight Panel 

shall terminate 6 months after the termination date specified in section 120. 

(g) FUNDING FOR EXPENSES.— 

(1) AUTHORIZATION OF APPROPRIATIONS.— 

There is authorized to be appropriated to the 

Oversight Panel such sums as may be necessary for any fiscal year, half of which shall 

be derived from the applicable account of the 

House of Representatives, and half of which 

shall be derived from the contingent fund of 

the Senate. 

(2) REIMBURSEMENT OF AMOUNTS.—An 

amount equal to the expenses of the Oversight Panel shall be promptly transferred by 

the Secretary, from time to time upon the 

presentment of a statement of such expenses 

by the Chairperson of the Oversight Panel, 

from funds made available to the Secretary 

under this Act to the applicable fund of the 

House of Representatives and the contingent 

fund of the Senate, as appropriate, as reimbursement for amounts expended from such 

account and fund under paragraph (1). 

SEC. 126. FDIC AUTHORITY. 

(a) IN GENERAL.—Section 18(a) of the Federal Deposit Insurance Act (12 U.S.C. 1828(a)) 

is amended by adding at the end the following new paragraph: 

‘‘(4) FALSE ADVERTISING, MISUSE OF FDIC

NAMES, AND MISREPRESENTATION TO INDICATE

INSURED STATUS.— 

‘‘(A) PROHIBITION ON FALSE ADVERTISING

AND MISUSE OF FDIC NAMES.—No person may 

represent or imply that any deposit liability, 

obligation, certificate, or share is insured or 

guaranteed by the Corporation, if such deposit liability, obligation, certificate, or 

share is not insured or guaranteed by the 

Corporation— 

‘‘(i) by using the terms ‘Federal Deposit’, 

‘Federal Deposit Insurance’, ‘Federal Deposit 

Insurance Corporation’, any combination of 

such terms, or the abbreviation ‘FDIC’ as 

part of the business name or firm name of 

any person, including any corporation, partnership, business trust, association, or other 

business entity; or 

‘‘(ii) by using such terms or any other 

terms, sign, or symbol as part of an advertisement, solicitation, or other document. 

‘‘(B) PROHIBITION ON MISREPRESENTATIONS

OF INSURED STATUS.—No person may knowingly misrepresent— 

‘‘(i) that any deposit liability, obligation, 

certificate, or share is insured, under this 

Act, if such deposit liability, obligation, certificate, or share is not so insured; or 

‘‘(ii) the extent to which or the manner in 

which any deposit liability, obligation, certificate, or share is insured under this Act, if 

such deposit liability, obligation, certificate, 

or share is not so insured, to the extent or in 

the manner represented. 

‘‘(C) AUTHORITY OF THE APPROPRIATE FEDERAL BANKING AGENCY.—The appropriate Federal banking agency shall have enforcement 

authority in the case of a violation of this 

paragraph by any person for which the agency is the appropriate Federal banking agency, or any institution-affiliated party thereof. 

‘‘(D) CORPORATION AUTHORITY IF THE APPROPRIATE FEDERAL BANKING AGENCY FAILS TO

FOLLOW RECOMMENDATION.— 

‘‘(i) RECOMMENDATION.—The Corporation 

may recommend in writing to the appropriate Federal banking agency that the 

agency take any enforcement action authorized under section 8 for purposes of enforcement of this paragraph with respect to any 

person for which the agency is the appropriate Federal banking agency or any institution-affiliated party thereof. 

‘‘(ii) AGENCY RESPONSE.—If the appropriate 

Federal banking agency does not, within 30 

days of the date of receipt of a recommendation under clause (i), take the enforcement 

action with respect to this paragraph recommended by the Corporation or provide a 

plan acceptable to the Corporation for responding to the situation presented, the Corporation may take the recommended enforcement action against such person or institution-affiliated party. 

‘‘(E) ADDITIONAL AUTHORITY.—In addition 

to its authority under subparagraphs (C) and 

(D), for purposes of this paragraph, the Corporation shall have, in the same manner and 

to the same extent as with respect to a State 

nonmember insured bank— 

‘‘(i) jurisdiction over— 

‘‘(I) any person other than a person for 

which another agency is the appropriate 

Federal banking agency or any institutionaffiliated party thereof; and 

‘‘(II) any person that aids or abets a violation of this paragraph by a person described 

in subclause (I); and 

‘‘(ii) for purposes of enforcing the requirements of this paragraph, the authority of the 

Corporation under— 

‘‘(I) section 10(c) to conduct investigations; 

and 

‘‘(II) subsections (b), (c), (d) and (i) of section 8 to conduct enforcement actions. 

‘‘(F) OTHER ACTIONS PRESERVED.—No provision of this paragraph shall be construed as 

barring any action otherwise available, 

under the laws of the United States or any 

State, to any Federal or State agency or individual.’’. 

(b) ENFORCEMENT ORDERS.—Section 8(c) of 

the Federal Deposit Insurance Act (12 U.S.C. 

1818(c)) is amended by adding at the end the 

following new paragraph: 

‘‘(4) FALSE ADVERTISING OR MISUSE OF

NAMES TO INDICATE INSURED STATUS.— 

‘‘(A) TEMPORARY ORDER.— 

‘‘(i) IN GENERAL.—If a notice of charges 

served under subsection (b)(1) specifies on 

the basis of particular facts that any person 

engaged or is engaging in conduct described 

in section 18(a)(4), the Corporation or other 

appropriate Federal banking agency may 

issue a temporary order requiring— 

‘‘(I) the immediate cessation of any activity or practice described, which gave rise to 

the notice of charges; and 

‘‘(II) affirmative action to prevent any further, or to remedy any existing, violation. 

‘‘(ii) EFFECT OF ORDER.—Any temporary 

order issued under this subparagraph shall 

take effect upon service. 

‘‘(B) EFFECTIVE PERIOD OF TEMPORARY

ORDER.—A temporary order issued under subparagraph (A) shall remain effective and enforceable, pending the completion of an administrative proceeding pursuant to subsection (b)(1) in connection with the notice 

of charges— 

‘‘(i) until such time as the Corporation or 

other appropriate Federal banking agency 

dismisses the charges specified in such notice; or 

‘‘(ii) if a cease-and-desist order is issued 

against such person, until the effective date 

of such order. 

‘‘(C) CIVIL MONEY PENALTIES.—Any violation of section 18(a)(4) shall be subject to 


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civil money penalties, as set forth in subsection (i), except that for any person other 

than an insured depository institution or an 

institution-affiliated party that is found to 

have violated this paragraph, the Corporation or other appropriate Federal banking 

agency shall not be required to demonstrate 

any loss to an insured depository institution.’’. 

(c) UNENFORCEABILITY OF CERTAIN AGREEMENTS.—Section 13(c) of the Federal Deposit 

Insurance Act (12 U.S.C. 1823(c)) is amended 

by adding at the end the following new paragraph: 

‘‘(11) UNENFORCEABILITY OF CERTAIN AGREEMENTS.—No provision contained in any existing or future standstill, confidentiality, or 

other agreement that, directly or indirectly— 

‘‘(A) affects, restricts, or limits the ability 

of any person to offer to acquire or acquire, 

‘‘(B) prohibits any person from offering to 

acquire or acquiring, or 

‘‘(C) prohibits any person from using any 

previously disclosed information in connection with any such offer to acquire or acquisition of, 

all or part of any insured depository institution, including any liabilities, assets, or interest therein, in connection with any transaction in which the Corporation exercises its 

authority under section 11 or 13, shall be enforceable against or impose any liability on 

such person, as such enforcement or liability 

shall be contrary to public policy.’’. 

(d) TECHNICAL AND CONFORMING AMENDMENTS.—Section 18 of the Federal Deposit Insurance Act (12 U.S.C. 1828) is amended— 

(1) in subsection (a)(3)— 

(A) by striking ‘‘this subsection’’ the first 

place that term appears and inserting ‘‘paragraph (1)’’; and 

(B) by striking ‘‘this subsection’’ the second place that term appears and inserting 

‘‘paragraph (2)’’; and 

(2) in the heading for subsection (a), by 

striking ‘‘INSURANCE LOGO.—’’ and inserting 

‘‘REPRESENTATIONS OF DEPOSIT INSURANCE.— 

’’. 

SEC. 127. COOPERATION WITH THE FBI. 

Any Federal financial regulatory agency 

shall cooperate with the Federal Bureau of 

Investigation and other law enforcement 

agencies investigating fraud, misrepresentation, and malfeasance with respect to development, advertising, and sale of financial 

products. 

SEC. 128. ACCELERATION OF EFFECTIVE DATE. 

Section 203 of the Financial Services Regulatory Relief Act of 2006 (12 U.S.C. 461 note) 

is amended by striking ‘‘October 1, 2011’’ and 

inserting ‘‘October 1, 2008’’. 

SEC. 129. DISCLOSURES ON EXERCISE OF LOAN 

AUTHORITY. 

(a) IN GENERAL.—Not later than 7 days 

after the date on which the Board exercises 

its authority under the third paragraph of 

section 13 of the Federal Reserve Act (12 

U.S.C. 343; relating to discounts for individuals, partnerships, and corporations) the 

Board shall provide to the Committee on 

Banking, Housing, and Urban Affairs of the 

Senate and the Committee on Financial 

Services of the House of Representatives a 

report which includes— 

(1) the justification for exercising the authority; and 

(2) the specific terms of the actions of the 

Board, including the size and duration of the 

lending, available information concerning 

the value of any collateral held with respect 

to such a loan, the recipient of warrants or 

any other potential equity in exchange for 

the loan, and any expected cost to the taxpayers for such exercise. 

(b) PERIODIC UPDATES.—The Board shall 

provide updates to the Committees specified 

in subsection (a) not less frequently than 

once every 60 days while the subject loan is 

outstanding, including— 

(1) the status of the loan; 

(2) the value of the collateral held by the 

Federal reserve bank which initiated the 

loan; and 

(3) the projected cost to the taxpayers of 

the loan. 

(c) CONFIDENTIALITY.—The information 

submitted to the Congress under this section 

shall be kept confidential, upon the written 

request of the Chairman of the Board, in 

which case it shall be made available only to 

the Chairpersons and Ranking Members of 

the Committees described in subsection (a). 

(d) APPLICABILITY.—The provisions of this 

section shall be in force for all uses of the 

authority provided under section 13 of the 

Federal Reserve Act occurring during the period beginning on March 1, 2008 and ending 

on the after the date of enactment of this 

Act, and reports described in subsection (a) 

shall be required beginning not later than 30 

days after that date of enactment, with respect to any such exercise of authority. 

(e) SHARING OF INFORMATION.—Any reports 

required under this section shall also be submitted to the Congressional Oversight Panel 

established under section 125. 

SEC. 130. TECHNICAL CORRECTIONS. 

(a) IN GENERAL.—Section 128(b)(2) of the 

Truth in Lending Act (15 U.S.C. 1638(b)(2)), as 

amended by section 2502 of the Mortgage Disclosure Improvement Act of 2008 (Public Law 

110-289), is amended— 

(1) in subparagraph (A), by striking ‘‘In the 

case’’ and inserting ‘‘Except as provided in 

subparagraph (G), in the case’’; and 

(2) by amending subparagraph (G) to read 

as follows: 

‘‘(G)(i) In the case of an extension of credit 

relating to a plan described in section 

101(53D) of title 11, United States Code— 

‘‘(I) the requirements of subparagraphs (A) 

through (E) shall not apply; and 

‘‘(II) a good faith estimate of the disclosures required under subsection (a) shall be 

made in accordance with regulations of the 

Board under section 121(c) before such credit 

is extended, or shall be delivered or placed in 

the mail not later than 3 business days after 

the date on which the creditor receives the 

written application of the consumer for such 

credit, whichever is earlier. 

‘‘(ii) If a disclosure statement furnished 

within 3 business days of the written application (as provided under clause (i)(II)) contains an annual percentage rate which is 

subsequently rendered inaccurate, within the 

meaning of section 107(c), the creditor shall 

furnish another disclosure statement at the 

time of settlement or consummation of the 

transaction.’’. 

(b) EFFECTIVE DATE.—The amendments 

made by subsection (a) shall take effect as if 

included in the amendments made by section 

2502 of the Mortgage Disclosure Improvement Act of 2008 (Public Law 110-289). 

SEC. 131. EXCHANGE STABILIZATION FUND REIMBURSEMENT. 

(a) REIMBURSEMENT.—The Secretary shall 

reimburse the Exchange Stabilization Fund 

established under section 5302 of title 31, 

United States Code, for any funds that are 

used for the Treasury Money Market Funds 

Guaranty Program for the United States 

money market mutual fund industry, from 

funds under this Act. 

(b) LIMITS ON USE OF EXCHANGE STABILIZATION FUND.—The Secretary is prohibited 

from using the Exchange Stabilization Fund 

for the establishment of any future guaranty 

programs for the United States money market mutual fund industry. 

SEC. 132. AUTHORITY TO SUSPEND MARK-TOMARKET ACCOUNTING. 

(a) AUTHORITY.—The Securities and Exchange Commission shall have the authority 

under the securities laws (as such term is defined in section 3(a)(47) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)(47)) to 

suspend, by rule, regulation, or order, the application of Statement Number 157 of the Financial Accounting Standards Board for any 

issuer (as such term is defined in section 

3(a)(8) of such Act) or with respect to any 

class or category of transaction if the Commission determines that is necessary or appropriate in the public interest and is consistent with the protection of investors. 

(b) SAVINGS PROVISION.—Nothing in subsection (a) shall be construed to restrict or 

limit any authority of the Securities and Exchange Commission under securities laws as 

in effect on the date of enactment of this 

Act. 

SEC. 133. STUDY ON MARK-TO-MARKET ACCOUNTING. 

(a) STUDY.—The Securities and Exchange 

Commission, in consultation with the Board 

and the Secretary, shall conduct a study on 

mark-to-market accounting standards as 

provided in Statement Number 157 of the Financial Accounting Standards Board, as such 

standards are applicable to financial institutions, including depository institutions. 

Such a study shall consider at a minimum— 

(1) the effects of such accounting standards 

on a financial institution’s balance sheet; 

(2) the impacts of such accounting on bank 

failures in 2008; 

(3) the impact of such standards on the 

quality of financial information available to 

investors; 

(4) the process used by the Financial Accounting Standards Board in developing accounting standards; 

(5) the advisability and feasibility of modifications to such standards; and 

(6) alternative accounting standards to 

those provided in such Statement Number 

157. 

(b) REPORT.—The Securities and Exchange 

Commission shall submit to Congress a report of such study before the end of the 90- 

day period beginning on the date of the enactment of this Act containing the findings 

and determinations of the Commission, including such administrative and legislative 

recommendations as the Commission determines appropriate. 

SEC. 134. RECOUPMENT. 

Upon the expiration of the 5-year period 

beginning upon the date of the enactment of 

this Act, the Director of the Office of Management and Budget, in consultation with 

the Director of the Congressional Budget Office, shall submit a report to the Congress on 

the net amount within the Troubled Asset 

Relief Program under this Act. In any case 

where there is a shortfall, the President 

shall submit a legislative proposal that recoups from the financial industry an amount 

equal to the shortfall in order to ensure that 

the Troubled Asset Relief Program does not 

add to the deficit or national debt. 

SEC. 135. PRESERVATION OF AUTHORITY. 

With the exception of section 131, nothing 

in this Act may be construed to limit the authority of the Secretary or the Board under 

any other provision of law. 

SEC. 136. TEMPORARY INCREASE IN DEPOSIT 

AND SHARE INSURANCE COVERAGE. 

(a) FEDERAL DEPOSIT INSURANCE ACT; TEMPORARY INCREASE IN DEPOSIT INSURANCE.— 

(1) INCREASED AMOUNT.—Effective only during the period beginning on the date of enactment of this Act and ending on December 

31, 2009, section 11(a)(1)(E) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)(E)) 

shall apply with ‘‘$250,000’’ substituted for 

‘‘$100,000’’. 

(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SETTING ASSESSMENTS.—The temporary increase in the standard maximum 


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deposit insurance amount made under paragraph (1) shall not be taken into account by 

the Board of Directors of the Corporation for 

purposes of setting assessments under section 7(b)(2) of the Federal Deposit Insurance 

Act (12 U.S.C. 1817(b)(2)). 

(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the period beginning on the date 

of enactment of this Act and ending on December 31, 2009, the Board of Directors of the 

Corporation may request from the Secretary, 

and the Secretary shall approve, a loan or 

loans in an amount or amounts necessary to 

carry out this subsection, without regard to 

the limitations on such borrowing under section 14(a) and 15(c) of the Federal Deposit Insurance Act (12 U.S.C. 1824(a), 1825(c)). 

(b) FEDERAL CREDIT UNION ACT; TEMPORARY INCREASE IN SHARE INSURANCE.— 

(1) INCREASED AMOUNT.—Effective only during the period beginning on the date of enactment of this Act and ending on December 

31, 2009, section 207(k)(5) of the Federal Credit Union Act (12 U.S.C. 1787(k)(5)) shall apply 

with ‘‘$250,000’’ substituted for ‘‘$100,000’’. 

(2) TEMPORARY INCREASE NOT TO BE CONSIDERED FOR SETTING INSURANCE PREMIUM

CHARGES AND INSURANCE DEPOSIT ADJUSTMENTS.—The temporary increase in the 

standard maximum share insurance amount 

made under paragraph (1) shall not be taken 

into account by the National Credit Union 

Administration Board for purposes of setting 

insurance premium charges and share insurance deposit adjustments under section 

202(c)(2) of the Federal Credit Union Act (12 

U.S.C. 1782(c)(2)). 

(3) BORROWING LIMITS TEMPORARILY LIFTED.—During the period beginning on the date 

of enactment of this Act and ending on December 31, 2009, the National Credit Union 

Administration Board may request from the 

Secretary, and the Secretary shall approve, a 

loan or loans in an amount or amounts necessary to carry out this subsection, without 

regard to the limitations on such borrowing 

under section 203(d)(1) of the Federal Credit 

Union Act (12 U.S.C. 1783(d)(1)). 

(c) NOT FOR USE IN INFLATION ADJUSTMENTS.—The temporary increase in the 

standard maximum deposit insurance 

amount made under this section shall not be 

used to make any inflation adjustment under 

section 11(a)(1)(F) of the Federal Deposit Insurance Act (12 U.S.C. 1821(a)(1)(F)) for purposes of that Act or the Federal Credit Union 

Act. 

TITLE II—BUDGET-RELATED PROVISIONS 

SEC. 201. INFORMATION FOR CONGRESSIONAL 

SUPPORT AGENCIES. 

Upon request, and to the extent otherwise 

consistent with law, all information used by 

the Secretary in connection with activities 

authorized under this Act (including the 

records to which the Comptroller General is 

entitled under this Act) shall be made available to congressional support agencies (in 

accordance with their obligations to support 

the Congress as set out in their authorizing 

statutes) for the purposes of assisting the 

committees of Congress with conducting 

oversight, monitoring, and analysis of the 

activities authorized under this Act. 

SEC. 202. REPORTS BY THE OFFICE OF MANAGEMENT AND BUDGET AND THE CONGRESSIONAL BUDGET OFFICE. 

(a) REPORTS BY THE OFFICE OF MANAGEMENT AND BUDGET.—Within 60 days of the 

first exercise of the authority granted in section 101(a), but in no case later than December 31, 2008, and semiannually thereafter, the 

Office of Management and Budget shall report to the President and the Congress— 

(1) the estimate, notwithstanding section 

502(5)(F) of the Federal Credit Reform Act of 

1990 (2 U.S.C. 661a(5)(F)), as of the first business day that is at least 30 days prior to the 

issuance of the report, of the cost of the 

troubled assets, and guarantees of the troubled assets, determined in accordance with 

section 123; 

(2) the information used to derive the estimate, including assets purchased or guaranteed, prices paid, revenues received, the impact on the deficit and debt, and a description of any outstanding commitments to 

purchase troubled assets; and 

(3) a detailed analysis of how the estimate 

has changed from the previous report. 

Beginning with the second report under subsection (a), the Office of Management and 

Budget shall explain the differences between 

the Congressional Budget Office estimates 

delivered in accordance with subsection (b) 

and prior Office of Management and Budget 

estimates. 

(b) REPORTS BY THE CONGRESSIONAL BUDGET

OFFICE.—Within 45 days of receipt by the 

Congress of each report from the Office of 

Management and Budget under subsection 

(a), the Congressional Budget Office shall report to the Congress the Congressional Budget Office’s assessment of the report submitted by the Office of Management and 

Budget, including— 

(1) the cost of the troubled assets and guarantees of the troubled assets, 

(2) the information and valuation methods 

used to calculate such cost, and 

(3) the impact on the deficit and the debt. 

(c) FINANCIAL EXPERTISE.—In carrying out 

the duties in this subsection or performing 

analyses of activities under this Act, the Director of the Congressional Budget Office 

may employ personnel and procure the services of experts and consultants. 

(d) AUTHORIZATION OF APPROPRIATIONS.— 

There are authorized to be appropriated such 

sums as may be necessary to produce reports 

required by this section. 

SEC. 203. ANALYSIS IN PRESIDENT’S BUDGET. 

(a) IN GENERAL.—Section 1105(a) of title 31, 

United States Code, is amended by adding at 

the end the following new paragraph: 

‘‘(35) as supplementary materials, a separate analysis of the budgetary effects for all 

prior fiscal years, the current fiscal year, the 

fiscal year for which the budget is submitted, and ensuing fiscal years of the actions the Secretary of the Treasury has 

taken or plans to take using any authority 

provided in the Emergency Economic Stabilization Act of 2008, including— 

‘‘(A) an estimate of the current value of all 

assets purchased, sold, and guaranteed under 

the authority provided in the Emergency 

Economic Stabilization Act of 2008 using 

methodology required by the Federal Credit 

Reform Act of 1990 (2 U.S.C. 661 et seq.) and 

section 123 of the Emergency Economic Stabilization Act of 2008; 

‘‘(B) an estimate of the deficit, the debt 

held by the public, and the gross Federal 

debt using methodology required by the Federal Credit Reform Act of 1990 and section 

123 of the Emergency Economic Stabilization 

Act of 2008; 

‘‘(C) an estimate of the current value of all 

assets purchased, sold, and guaranteed under 

the authority provided in the Emergency 

Economic Stabilization Act of 2008 calculated on a cash basis; 

‘‘(D) a revised estimate of the deficit, the 

debt held by the public, and the gross Federal debt, substituting the cash-based estimates in subparagraph (C) for the estimates 

calculated under subparagraph (A) pursuant 

to the Federal Credit Reform Act of 1990 and 

section 123 of the Emergency Economic Stabilization Act of 2008; and 

‘‘(E) the portion of the deficit which can be 

attributed to any action taken by the Secretary using authority provided by the 

Emergency Economic Stabilization Act of 

2008 and the extent to which the change in 

the deficit since the most recent estimate is 

due to a reestimate using the methodology 

required by the Federal Credit Reform Act of 

1990 and section 123 of the Emergency Economic Stabilization Act of 2008.’’ 

(b) CONSULTATION.—In implementing this 

section, the Director of Office of Management and Budget shall consult periodically, 

but at least annually, with the Committee 

on the Budget of the House of Representatives, the Committee on the Budget of the 

Senate, and the Director of the Congressional Budget Office. 

(c) EFFECTIVE DATE.—This section and the 

amendment made by this section shall apply 

beginning with respect to the fiscal year 2010 

budget submission of the President. 

SEC. 204. EMERGENCY TREATMENT. 

All provisions of this Act are designated as 

an emergency requirement and necessary to 

meet emergency needs pursuant to section 

204(a) of S. Con. Res 21 (110th Congress), the 

concurrent resolution on the budget for fiscal year 2008 and rescissions of any amounts 

provided in this Act shall not be counted for 

purposes of budget enforcement. 

TITLE III—TAX PROVISIONS 

SEC. 301. GAIN OR LOSS FROM SALE OR EXCHANGE OF CERTAIN PREFERRED 

STOCK. 

(a) IN GENERAL.—For purposes of the Internal Revenue Code of 1986, gain or loss from 

the sale or exchange of any applicable preferred stock by any applicable financial institution shall be treated as ordinary income 

or loss. 

(b) APPLICABLE PREFERRED STOCK.—For 

purposes of this section, the term ‘‘applicable preferred stock’’ means any stock— 

(1) which is preferred stock in— 

(A) the Federal National Mortgage Association, established pursuant to the Federal 

National Mortgage Association Charter Act 

(12 U.S.C. 1716 et seq.), or 

(B) the Federal Home Loan Mortgage Corporation, established pursuant to the Federal Home Loan Mortgage Corporation Act 

(12 U.S.C. 1451 et seq.), and 

(2) which— 

(A) was held by the applicable financial institution on September 6, 2008, or 

(B) was sold or exchanged by the applicable 

financial institution on or after January 1, 

2008, and before September 7, 2008. 

(c) APPLICABLE FINANCIAL INSTITUTION.— 

For purposes of this section: 

(1) IN GENERAL.—Except as provided in 

paragraph (2), the term ‘‘applicable financial 

institution’’ means— 

(A) a financial institution referred to in 

section 582(c)(2) of the Internal Revenue Code 

of 1986, or 

(B) a depository institution holding company (as defined in section 3(w)(1) of the Federal Deposit Insurance Act (12 U.S.C. 

1813(w)(1))). 

(2) SPECIAL RULES FOR CERTAIN SALES.—In 

the case of— 

(A) a sale or exchange described in subsection (b)(2)(B), an entity shall be treated as 

an applicable financial institution only if it 

was an entity described in subparagraph (A) 

or (B) of paragraph (1) at the time of the sale 

or exchange, and 

(B) a sale or exchange after September 6, 

2008, of preferred stock described in subsection (b)(2)(A), an entity shall be treated 

as an applicable financial institution only if 

it was an entity described in subparagraph 

(A) or (B) of paragraph (1) at all times during 

the period beginning on September 6, 2008, 

and ending on the date of the sale or exchange of the preferred stock. 

(d) SPECIAL RULE FOR CERTAIN PROPERTY

NOT HELD ON SEPTEMBER 6, 2008.—The Secretary of the Treasury or the Secretary’s 


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delegate may extend the application of this 

section to all or a portion of the gain or loss 

from a sale or exchange in any case where— 

(1) an applicable financial institution sells 

or exchanges applicable preferred stock after 

September 6, 2008, which the applicable financial institution did not hold on such 

date, but the basis of which in the hands of 

the applicable financial institution at the 

time of the sale or exchange is the same as 

the basis in the hands of the person which 

held such stock on such date, or 

(2) the applicable financial institution is a 

partner in a partnership which— 

(A) held such stock on September 6, 2008, 

and later sold or exchanged such stock, or 

(B) sold or exchanged such stock during 

the period described in subsection (b)(2)(B). 

(e) REGULATORY AUTHORITY.—The Secretary of the Treasury or the Secretary’s 

delegate may prescribe such guidance, rules, 

or regulations as are necessary to carry out 

the purposes of this section. 

(f) EFFECTIVE DATE.—This section shall 

apply to sales or exchanges occurring after 

December 31, 2007, in taxable years ending 

after such date. 

SEC. 302. SPECIAL RULES FOR TAX TREATMENT 

OF EXECUTIVE COMPENSATION OF 

EMPLOYERS PARTICIPATING IN THE 

TROUBLED ASSETS RELIEF PROGRAM. 

(a) DENIAL OF DEDUCTION.—Subsection (m) 

of section 162 of the Internal Revenue Code 

of 1986 is amended by adding at the end the 

following new paragraph: 

‘‘(5) SPECIAL RULE FOR APPLICATION TO EMPLOYERS PARTICIPATING IN THE TROUBLED ASSETS RELIEF PROGRAM.— 

‘‘(A) IN GENERAL.—In the case of an applicable employer, no deduction shall be allowed under this chapter— 

‘‘(i) in the case of executive remuneration 

for any applicable taxable year which is attributable to services performed by a covered 

executive during such applicable taxable 

year, to the extent that the amount of such 

remuneration exceeds $500,000, or 

‘‘(ii) in the case of deferred deduction executive remuneration for any taxable year for 

services performed during any applicable 

taxable year by a covered executive, to the 

extent that the amount of such remuneration exceeds $500,000 reduced (but not below 

zero) by the sum of— 

‘‘(I) the executive remuneration for such 

applicable taxable year, plus 

‘‘(II) the portion of the deferred deduction 

executive remuneration for such services 

which was taken into account under this 

clause in a preceding taxable year. 

‘‘(B) APPLICABLE EMPLOYER.—For purposes 

of this paragraph— 

‘‘(i) IN GENERAL.—Except as provided in 

clause (ii), the term ‘applicable employer’ 

means any employer from whom 1 or more 

troubled assets are acquired under a program 

established by the Secretary under section 

101(a) of the Emergency Economic Stabilization Act of 2008 if the aggregate amount of 

the assets so acquired for all taxable years 

exceeds $300,000,000. 

‘‘(ii) DISREGARD OF CERTAIN ASSETS SOLD

THROUGH DIRECT PURCHASE.—If the only sales 

of troubled assets by an employer under the 

program described in clause (i) are through 1 

or more direct purchases (within the meaning of section 113(c) of the Emergency Economic Stabilization Act of 2008), such assets 

shall not be taken into account under clause 

(i) in determining whether the employer is 

an applicable employer for purposes of this 

paragraph. 

‘‘(iii) AGGREGATION RULES.—Two or more 

persons who are treated as a single employer 

under subsection (b) or (c) of section 414 shall 

be treated as a single employer, except that 

in applying section 1563(a) for purposes of either such subsection, paragraphs (2) and (3) 

thereof shall be disregarded. 

‘‘(C) APPLICABLE TAXABLE YEAR.—For purposes of this paragraph, the term ‘applicable 

taxable year’ means, with respect to any employer— 

‘‘(i) the first taxable year of the employer— 

‘‘(I) which includes any portion of the period during which the authorities under section 101(a) of the Emergency Economic Stabilization Act of 2008 are in effect (determined under section 120 thereof), and 

‘‘(II) in which the aggregate amount of 

troubled assets acquired from the employer 

during the taxable year pursuant to such authorities (other than assets to which subparagraph (B)(ii) applies), when added to the 

aggregate amount so acquired for all preceding taxable years, exceeds $300,000,000, 

and 

‘‘(ii) any subsequent taxable year which includes any portion of such period. 

‘‘(D) COVERED EXECUTIVE.—For purposes of 

this paragraph— 

‘‘(i) IN GENERAL.—The term ‘covered executive’ means, with respect to any applicable 

taxable year, any employee— 

‘‘(I) who, at any time during the portion of 

the taxable year during which the authorities under section 101(a) of the Emergency 

Economic Stabilization Act of 2008 are in effect (determined under section 120 thereof), 

is the chief executive officer of the applicable employer or the chief financial officer of 

the applicable employer, or an individual 

acting in either such capacity, or 

‘‘(II) who is described in clause (ii). 

‘‘(ii) HIGHEST COMPENSATED EMPLOYEES.— 

An employee is described in this clause if the 

employee is 1 of the 3 highest compensated 

officers of the applicable employer for the 

taxable year (other than an individual described in clause (i)(I)), determined— 

‘‘(I) on the basis of the shareholder disclosure rules for compensation under the Securities Exchange Act of 1934 (without regard 

to whether those rules apply to the employer), and 

‘‘(II) by only taking into account employees employed during the portion of the taxable year described in clause (i)(I). 

‘‘(iii) EMPLOYEE REMAINS COVERED EXECUTIVE.—If an employee is a covered executive 

with respect to an applicable employer for 

any applicable taxable year, such employee 

shall be treated as a covered executive with 

respect to such employer for all subsequent 

applicable taxable years and for all subsequent taxable years in which deferred deduction executive remuneration with respect to 

services performed in all such applicable taxable years would (but for this paragraph) be 

deductible. 

‘‘(E) EXECUTIVE REMUNERATION.—For purposes of this paragraph, the term ‘executive 

remuneration’ means the applicable employee remuneration of the covered executive, as determined under paragraph (4) without regard to subparagraphs (B), (C), and (D) 

thereof. Such term shall not include any deferred deduction executive remuneration 

with respect to services performed in a prior 

applicable taxable year. 

‘‘(F) DEFERRED DEDUCTION EXECUTIVE REMUNERATION.—For purposes of this paragraph, 

the term ‘deferred deduction executive remuneration’ means remuneration which would 

be executive remuneration for services performed in an applicable taxable year but for 

the fact that the deduction under this chapter (determined without regard to this paragraph) for such remuneration is allowable in 

a subsequent taxable year. 

‘‘(G) COORDINATION.—Rules similar to the 

rules of subparagraphs (F) and (G) of paragraph (4) shall apply for purposes of this 

paragraph. 

‘‘(H) REGULATORY AUTHORITY.—The Secretary may prescribe such guidance, rules, or 

regulations as are necessary to carry out the 

purposes of this paragraph and the Emergency Economic Stabilization Act of 2008, including the extent to which this paragraph 

applies in the case of any acquisition, merger, or reorganization of an applicable employer.’’. 

(b) GOLDEN PARACHUTE RULE.—Section 

280G of the Internal Revenue Code of 1986 is 

amended— 

(1) by redesignating subsection (e) as subsection (f), and 

(2) by inserting after subsection (d) the following new subsection: 

‘‘(e) SPECIAL RULE FOR APPLICATION TO EMPLOYERS PARTICIPATING IN THE TROUBLED ASSETS RELIEF PROGRAM.— 

‘‘(1) IN GENERAL.—In the case of the severance from employment of a covered executive of an applicable employer during the period during which the authorities under section 101(a) of the Emergency Economic Stabilization Act of 2008 are in effect (determined under section 120 of such Act), this 

section shall be applied to payments to such 

executive with the following modifications: 

‘‘(A) Any reference to a disqualified individual (other than in subsection (c)) shall be 

treated as a reference to a covered executive. 

‘‘(B) Any reference to a change described in 

subsection (b)(2)(A)(i) shall be treated as a 

reference to an applicable severance from 

employment of a covered executive, and any 

reference to a payment contingent on such a 

change shall be treated as a reference to any 

payment made during an applicable taxable 

year of the employer on account of such applicable severance from employment. 

‘‘(C) Any reference to a corporation shall 

be treated as a reference to an applicable 

employer. 

‘‘(D) The provisions of subsections 

(b)(2)(C), (b)(4), (b)(5), and (d)(5) shall not 

apply. 

‘‘(2) DEFINITIONS AND SPECIAL RULES.—For 

purposes of this subsection: 

‘‘(A) DEFINITIONS.—Any term used in this 

subsection which is also used in section 

162(m)(5) shall have the meaning given such 

term by such section. 

‘‘(B) APPLICABLE SEVERANCE FROM EMPLOYMENT.—The term ‘applicable severance from 

employment’ means any severance from employment of a covered executive— 

‘‘(i) by reason of an involuntary termination of the executive by the employer, or 

‘‘(ii) in connection with any bankruptcy, 

liquidation, or receivership of the employer. 

‘‘(C) COORDINATION AND OTHER RULES.— 

‘‘(i) IN GENERAL.—If a payment which is 

treated as a parachute payment by reason of 

this subsection is also a parachute payment 

determined without regard to this subsection, this subsection shall not apply to 

such payment. 

‘‘(ii) REGULATORY AUTHORITY.—The Secretary may prescribe such guidance, rules, or 

regulations as are necessary— 

‘‘(I) to carry out the purposes of this subsection and the Emergency Economic Stabilization Act of 2008, including the extent to 

which this subsection applies in the case of 

any acquisition, merger, or reorganization of 

an applicable employer, 

‘‘(II) to apply this section and section 4999 

in cases where one or more payments with 

respect to any individual are treated as parachute payments by reason of this subsection, 

and other payments with respect to such individual are treated as parachute payments 

under this section without regard to this 

subsection, and 

‘‘(III) to prevent the avoidance of the application of this section through the 


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mischaracterization of a severance from employment as other than an applicable severance from employment.’’. 

(c) EFFECTIVE DATES.— 

(1) IN GENERAL.—The amendment made by 

subsection (a) shall apply to taxable years 

ending on or after the date of the enactment 

of this Act. 

(2) GOLDEN PARACHUTE RULE.—The amendments made by subsection (b) shall apply to 

payments with respect to severances occurring during the period during which the authorities under section 101(a) of this Act are 

in effect (determined under section 120 of 

this Act). 

SEC. 303. EXTENSION OF EXCLUSION OF INCOME 

FROM DISCHARGE OF QUALIFIED 

PRINCIPAL RESIDENCE INDEBTEDNESS. 

(a) EXTENSION.—Subparagraph (E) of section 108(a)(1) of the Internal Revenue Code of 

1986 is amended by striking ‘‘January 1, 2010’’ 

and inserting ‘‘January 1, 2013’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to discharges of indebtedness occurring on or after 

January 1, 2010. 

DIVISION B—ENERGY IMPROVEMENT AND 

EXTENSION ACT OF 2008 

SECTION 1. SHORT TITLE, ETC. 

(a) SHORT TITLE.—This division may be 

cited as the ‘‘Energy Improvement and Extension Act of 2008’’. 

(b) REFERENCE.—Except as otherwise expressly provided, whenever in this division 

an amendment or repeal is expressed in 

terms of an amendment to, or repeal of, a 

section or other provision, the reference 

shall be considered to be made to a section 

or other provision of the Internal Revenue 

Code of 1986. 

(c) TABLE OF CONTENTS.—The table of contents for this division is as follows: 

Sec. 1. Short title, etc. 

TITLE I—ENERGY PRODUCTION 

INCENTIVES 

Subtitle A—Renewable Energy Incentives 

Sec. 101. Renewable energy credit. 

Sec. 102. Production credit for electricity 

produced from marine renewables. 

Sec. 103. Energy credit. 

Sec. 104. Energy credit for small wind property. 

Sec. 105. Energy credit for geothermal heat 

pump systems. 

Sec. 106. Credit for residential energy efficient property. 

Sec. 107. New clean renewable energy bonds. 

Sec. 108. Credit for steel industry fuel. 

Sec. 109. Special rule to implement FERC 

and State electric restructuring 

policy. 

Subtitle B—Carbon Mitigation and Coal 

Provisions 

Sec. 111. Expansion and modification of advanced coal project investment 

credit. 

Sec. 112. Expansion and modification of coal 

gasification investment credit. 

Sec. 113. Temporary increase in coal excise 

tax; funding of Black Lung Disability Trust Fund. 

Sec. 114. Special rules for refund of the coal 

excise tax to certain coal producers and exporters. 

Sec. 115. Tax credit for carbon dioxide sequestration. 

Sec. 116. Certain income and gains relating 

to industrial source carbon dioxide treated as qualifying income for publicly traded partnerships. 

Sec. 117. Carbon audit of the tax code. 

TITLE II—TRANSPORTATION AND 

DOMESTIC FUEL SECURITY PROVISIONS 

Sec. 201. Inclusion of cellulosic biofuel in 

bonus depreciation for biomass 

ethanol plant property. 

Sec. 202. Credits for biodiesel and renewable 

diesel. 

Sec. 203. Clarification that credits for fuel 

are designed to provide an incentive for United States production. 

Sec. 204. Extension and modification of alternative fuel credit. 

Sec. 205. Credit for new qualified plug-in 

electric drive motor vehicles. 

Sec. 206. Exclusion from heavy truck tax for 

idling reduction units and advanced insulation. 

Sec. 207. Alternative fuel vehicle refueling 

property credit. 

Sec. 208. Certain income and gains relating 

to alcohol fuels and mixtures, 

biodiesel fuels and mixtures, 

and alternative fuels and mixtures treated as qualifying income for publicly traded partnerships. 

Sec. 209. Extension and modification of election to expense certain refineries. 

Sec. 210. Extension of suspension of taxable 

income limit on percentage depletion for oil and natural gas 

produced from marginal properties. 

Sec. 211. Transportation fringe benefit to bicycle commuters. 

TITLE III—ENERGY CONSERVATION AND 

EFFICIENCY PROVISIONS 

Sec. 301. Qualified energy conservation 

bonds. 

Sec. 302. Credit for nonbusiness energy property. 

Sec. 303. Energy efficient commercial buildings deduction. 

Sec. 304. New energy efficient home credit. 

Sec. 305. Modifications of energy efficient 

appliance credit for appliances 

produced after 2007. 

Sec. 306. Accelerated recovery period for depreciation of smart meters and 

smart grid systems. 

Sec. 307. Qualified green building and sustainable design projects. 

Sec. 308. Special depreciation allowance for 

certain reuse and recycling 

property. 

TITLE IV—REVENUE PROVISIONS 

Sec. 401. Limitation of deduction for income 

attributable to domestic production of oil, gas, or primary 

products thereof. 

Sec. 402. Elimination of the different treatment of foreign oil and gas extraction income and foreign oil 

related income for purposes of 

the foreign tax credit. 

Sec. 403. Broker reporting of customer’s 

basis in securities transactions. 

Sec. 404. 0.2 percent FUTA surtax. 

Sec. 405. Increase and extension of Oil Spill 

Liability Trust Fund tax. 

TITLE I—ENERGY PRODUCTION 

INCENTIVES 

Subtitle A—Renewable Energy Incentives 

SEC. 101. RENEWABLE ENERGY CREDIT. 

(a) EXTENSION OF CREDIT.— 

(1) 1-YEAR EXTENSION FOR WIND AND REFINED

COAL FACILITIES.—Paragraphs (1) and (8) of 

section 45(d) are each amended by striking 

‘‘January 1, 2009’’ and inserting ‘‘January 1, 

2010’’. 

(2) 2-YEAR EXTENSION FOR CERTAIN OTHER

FACILITIES.—Each of the following provisions 

of section 45(d) is amended by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2011’’: 

(A) Clauses (i) and (ii) of paragraph (2)(A). 

(B) Clauses (i)(I) and (ii) of paragraph 

(3)(A). 

(C) Paragraph (4). 

(D) Paragraph (5). 

(E) Paragraph (6). 

(F) Paragraph (7). 

(G) Subparagraphs (A) and (B) of paragraph 

(9). 

(b) MODIFICATION OF REFINED COAL AS A

QUALIFIED ENERGY RESOURCE.— 

(1) ELIMINATION OF INCREASED MARKET

VALUE TEST.—Section 45(c)(7)(A)(i) (defining 

refined coal), as amended by section 108, is 

amended— 

(A) by striking subclause (IV), 

(B) by adding ‘‘and’’ at the end of subclause (II), and 

(C) by striking ‘‘, and’’ at the end of subclause (III) and inserting a period. 

(2) INCREASE IN REQUIRED EMISSION REDUCTION.—Section 45(c)(7)(B) (defining qualified 

emission reduction) is amended by inserting 

‘‘at least 40 percent of the emissions of’’ 

after ‘‘nitrogen oxide and’’. 

(c) TRASH FACILITY CLARIFICATION.—Paragraph (7) of section 45(d) is amended— 

(1) by striking ‘‘facility which burns’’ and 

inserting ‘‘facility (other than a facility described in paragraph (6)) which uses’’, and 

(2) by striking ‘‘COMBUSTION’’. 

(d) EXPANSION OF BIOMASS FACILITIES.— 

(1) OPEN-LOOP BIOMASS FACILITIES.—Paragraph (3) of section 45(d) is amended by redesignating subparagraph (B) as subparagraph (C) and by inserting after subparagraph (A) the following new subparagraph: 

‘‘(B) EXPANSION OF FACILITY.—Such term 

shall include a new unit placed in service 

after the date of the enactment of this subparagraph in connection with a facility described in subparagraph (A), but only to the 

extent of the increased amount of electricity 

produced at the facility by reason of such 

new unit.’’. 

(2) CLOSED-LOOP BIOMASS FACILITIES.—Paragraph (2) of section 45(d) is amended by redesignating subparagraph (B) as subparagraph (C) and inserting after subparagraph 

(A) the following new subparagraph: 

‘‘(B) EXPANSION OF FACILITY.—Such term 

shall include a new unit placed in service 

after the date of the enactment of this subparagraph in connection with a facility described in subparagraph (A)(i), but only to 

the extent of the increased amount of electricity produced at the facility by reason of 

such new unit.’’. 

(e) MODIFICATION OF RULES FOR HYDROPOWER PRODUCTION.—Subparagraph (C) of 

section 45(c)(8) is amended to read as follows: 

‘‘(C) NONHYDROELECTRIC DAM.—For purposes of subparagraph (A), a facility is described in this subparagraph if— 

‘‘(i) the hydroelectric project installed on 

the nonhydroelectric dam is licensed by the 

Federal Energy Regulatory Commission and 

meets all other applicable environmental, licensing, and regulatory requirements, 

‘‘(ii) the nonhydroelectric dam was placed 

in service before the date of the enactment 

of this paragraph and operated for flood control, navigation, or water supply purposes 

and did not produce hydroelectric power on 

the date of the enactment of this paragraph, 

and 

‘‘(iii) the hydroelectric project is operated 

so that the water surface elevation at any 

given location and time that would have occurred in the absence of the hydroelectric 

project is maintained, subject to any license 

requirements imposed under applicable law 

that change the water surface elevation for 

the purpose of improving environmental 

quality of the affected waterway. 

The Secretary, in consultation with the Federal Energy Regulatory Commission, shall 


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certify if a hydroelectric project licensed at 

a nonhydroelectric dam meets the criteria in 

clause (iii). Nothing in this section shall affect the standards under which the Federal 

Energy Regulatory Commission issues licenses for and regulates hydropower projects 

under part I of the Federal Power Act.’’. 

(f) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall apply to property 

originally placed in service after December 

31, 2008. 

(2) REFINED COAL.—The amendments made 

by subsection (b) shall apply to coal produced and sold from facilities placed in service after December 31, 2008. 

(3) TRASH FACILITY CLARIFICATION.—The 

amendments made by subsection (c) shall 

apply to electricity produced and sold after 

the date of the enactment of this Act. 

(4) EXPANSION OF BIOMASS FACILITIES.—The 

amendments made by subsection (d) shall 

apply to property placed in service after the 

date of the enactment of this Act. 

SEC. 102. PRODUCTION CREDIT FOR ELECTRICITY PRODUCED FROM MARINE 

RENEWABLES. 

(a) IN GENERAL.—Paragraph (1) of section 

45(c) is amended by striking ‘‘and’’ at the 

end of subparagraph (G), by striking the period at the end of subparagraph (H) and inserting ‘‘, and’’, and by adding at the end the 

following new subparagraph: 

‘‘(I) marine and hydrokinetic renewable 

energy.’’. 

(b) MARINE RENEWABLES.—Subsection (c) of 

section 45 is amended by adding at the end 

the following new paragraph: 

‘‘(10) MARINE AND HYDROKINETIC RENEWABLE

ENERGY.— 

‘‘(A) IN GENERAL.—The term ‘marine and 

hydrokinetic renewable energy’ means energy derived from— 

‘‘(i) waves, tides, and currents in oceans, 

estuaries, and tidal areas, 

‘‘(ii) free flowing water in rivers, lakes, and 

streams, 

‘‘(iii) free flowing water in an irrigation 

system, canal, or other man-made channel, 

including projects that utilize nonmechanical structures to accelerate the flow of 

water for electric power production purposes, 

or 

‘‘(iv) differentials in ocean temperature 

(ocean thermal energy conversion). 

‘‘(B) EXCEPTIONS.—Such term shall not include any energy which is derived from any 

source which utilizes a dam, diversionary 

structure (except as provided in subparagraph (A)(iii)), or impoundment for electric 

power production purposes.’’. 

(c) DEFINITION OF FACILITY.—Subsection (d) 

of section 45 is amended by adding at the end 

the following new paragraph: 

‘‘(11) MARINE AND HYDROKINETIC RENEWABLE

ENERGY FACILITIES.—In the case of a facility 

producing electricity from marine and 

hydrokinetic renewable energy, the term 

‘qualified facility’ means any facility owned 

by the taxpayer— 

‘‘(A) which has a nameplate capacity rating of at least 150 kilowatts, and 

‘‘(B) which is originally placed in service 

on or after the date of the enactment of this 

paragraph and before January 1, 2012.’’. 

(d) CREDIT RATE.—Subparagraph (A) of section 45(b)(4) is amended by striking ‘‘or (9)’’ 

and inserting ‘‘(9), or (11)’’. 

(e) COORDINATION WITH SMALL IRRIGATION

POWER.—Paragraph (5) of section 45(d), as 

amended by section 101, is amended by striking ‘‘January 1, 2012’’ and inserting ‘‘the date 

of the enactment of paragraph (11)’’. 

(f) EFFECTIVE DATE.—The amendments 

made by this section shall apply to electricity produced and sold after the date of 

the enactment of this Act, in taxable years 

ending after such date. 

SEC. 103. ENERGY CREDIT. 

(a) EXTENSION OF CREDIT.— 

(1) SOLAR ENERGY PROPERTY.—Paragraphs 

(2)(A)(i)(II) and (3)(A)(ii) of section 48(a) are 

each amended by striking ‘‘January 1, 2009’’ 

and inserting ‘‘January 1, 2017’’. 

(2) FUEL CELL PROPERTY.—Subparagraph 

(E) of section 48(c)(1) is amended by striking 

‘‘December 31, 2008’’ and inserting ‘‘December 31, 2016’’. 

(3) MICROTURBINE PROPERTY.—Subparagraph (E) of section 48(c)(2) is amended by 

striking ‘‘December 31, 2008’’ and inserting 

‘‘December 31, 2016’’. 

(b) ALLOWANCE OF ENERGY CREDIT AGAINST

ALTERNATIVE MINIMUM TAX.— 

(1) IN GENERAL.—Subparagraph (B) of section 38(c)(4), as amended by the Housing Assistance Tax Act of 2008, is amended by redesignating clause (vi) as clause (vi) and 

(vii), respectively, and by inserting after 

clause (iv) the following new clause: 

‘‘(v) the credit determined under section 46 

to the extent that such credit is attributable 

to the energy credit determined under section 48,’’. 

(2) TECHNICAL AMENDMENT.—Clause (vi) of 

section 38(c)(4)(B), as redesignated by paragraph (1), is amended by striking ‘‘section 47 

to the extent attributable to’’ and inserting 

‘‘section 46 to the extent that such credit is 

attributable to the rehabilitation credit 

under section 47, but only with respect to’’. 

(c) ENERGY CREDIT FOR COMBINED HEAT AND

POWER SYSTEM PROPERTY.— 

(1) IN GENERAL.—Section 48(a)(3)(A) is 

amended by striking ‘‘or’’ at the end of 

clause (iii), by inserting ‘‘or’’ at the end of 

clause (iv), and by adding at the end the following new clause: 

‘‘(v) combined heat and power system property,’’. 

(2) COMBINED HEAT AND POWER SYSTEM

PROPERTY.—Subsection (c) of section 48 is 

amended— 

(A) by striking ‘‘QUALIFIED FUEL CELL

PROPERTY; QUALIFIED MICROTURBINE PROPERTY’’ in the heading and inserting ‘‘DEFINITIONS’’, and 

(B) by adding at the end the following new 

paragraph: 

‘‘(3) COMBINED HEAT AND POWER SYSTEM

PROPERTY.— 

‘‘(A) COMBINED HEAT AND POWER SYSTEM

PROPERTY.—The term ‘combined heat and 

power system property’ means property comprising a system— 

‘‘(i) which uses the same energy source for 

the simultaneous or sequential generation of 

electrical power, mechanical shaft power, or 

both, in combination with the generation of 

steam or other forms of useful thermal energy (including heating and cooling applications), 

‘‘(ii) which produces— 

‘‘(I) at least 20 percent of its total useful 

energy in the form of thermal energy which 

is not used to produce electrical or mechanical power (or combination thereof), and 

‘‘(II) at least 20 percent of its total useful 

energy in the form of electrical or mechanical power (or combination thereof), 

‘‘(iii) the energy efficiency percentage of 

which exceeds 60 percent, and 

‘‘(iv) which is placed in service before January 1, 2017. 

‘‘(B) LIMITATION.— 

‘‘(i) IN GENERAL.—In the case of combined 

heat and power system property with an 

electrical capacity in excess of the applicable capacity placed in service during the taxable year, the credit under subsection (a)(1) 

(determined without regard to this paragraph) for such year shall be equal to the 

amount which bears the same ratio to such 

credit as the applicable capacity bears to the 

capacity of such property. 

‘‘(ii) APPLICABLE CAPACITY.—For purposes 

of clause (i), the term ‘applicable capacity’ 

means 15 megawatts or a mechanical energy 

capacity of more than 20,000 horsepower or 

an equivalent combination of electrical and 

mechanical energy capacities. 

‘‘(iii) MAXIMUM CAPACITY.—The term ‘combined heat and power system property’ shall 

not include any property comprising a system if such system has a capacity in excess 

of 50 megawatts or a mechanical energy capacity in excess of 67,000 horsepower or an 

equivalent combination of electrical and mechanical energy capacities. 

‘‘(C) SPECIAL RULES.— 

‘‘(i) ENERGY EFFICIENCY PERCENTAGE.—For 

purposes of this paragraph, the energy efficiency percentage of a system is the fraction— 

‘‘(I) the numerator of which is the total 

useful electrical, thermal, and mechanical 

power produced by the system at normal operating rates, and expected to be consumed 

in its normal application, and 

‘‘(II) the denominator of which is the lower 

heating value of the fuel sources for the system. 

‘‘(ii) DETERMINATIONS MADE ON BTU BASIS.— 

The energy efficiency percentage and the 

percentages under subparagraph (A)(ii) shall 

be determined on a Btu basis. 

‘‘(iii) INPUT AND OUTPUT PROPERTY NOT INCLUDED.—The term ‘combined heat and 

power system property’ does not include 

property used to transport the energy source 

to the facility or to distribute energy produced by the facility. 

‘‘(D) SYSTEMS USING BIOMASS.—If a system 

is designed to use biomass (within the meaning of paragraphs (2) and (3) of section 45(c) 

without regard to the last sentence of paragraph (3)(A)) for at least 90 percent of the energy source— 

‘‘(i) subparagraph (A)(iii) shall not apply, 

but 

‘‘(ii) the amount of credit determined 

under subsection (a) with respect to such 

system shall not exceed the amount which 

bears the same ratio to such amount of credit (determined without regard to this subparagraph) as the energy efficiency percentage of such system bears to 60 percent.’’. 

(3) CONFORMING AMENDMENT.—Section 

48(a)(1) is amended by striking ‘‘paragraphs 

(1)(B) and (2)(B)’’ and inserting ‘‘paragraphs 

(1)(B), (2)(B), and (3)(B)’’. 

(d) INCREASE OF CREDIT LIMITATION FOR

FUEL CELL PROPERTY.—Subparagraph (B) of 

section 48(c)(1) is amended by striking ‘‘$500’’ 

and inserting ‘‘$1,500’’. 

(e) PUBLIC UTILITY PROPERTY TAKEN INTO

ACCOUNT.— 

(1) IN GENERAL.—Paragraph (3) of section 

48(a) is amended by striking the second sentence thereof. 

(2) CONFORMING AMENDMENTS.— 

(A) Paragraph (1) of section 48(c) is amended by striking subparagraph (D) and redesignating subparagraph (E) as subparagraph 

(D). 

(B) Paragraph (2) of section 48(c) is amended by striking subparagraph (D) and redesignating subparagraph (E) as subparagraph 

(D). 

(f) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall take effect on the 

date of the enactment of this Act. 

(2) ALLOWANCE AGAINST ALTERNATIVE MINIMUM TAX.—The amendments made by subsection (b) shall apply to credits determined 

under section 46 of the Internal Revenue 

Code of 1986 in taxable years beginning after 

the date of the enactment of this Act and to 

carrybacks of such credits. 

(3) COMBINED HEAT AND POWER AND FUEL

CELL PROPERTY.—The amendments made by 


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subsections (c) and (d) shall apply to periods 

after the date of the enactment of this Act, 

in taxable years ending after such date, 

under rules similar to the rules of section 

48(m) of the Internal Revenue Code of 1986 

(as in effect on the day before the date of the 

enactment of the Revenue Reconciliation 

Act of 1990). 

(4) PUBLIC UTILITY PROPERTY.—The amendments made by subsection (e) shall apply to 

periods after February 13, 2008, in taxable 

years ending after such date, under rules 

similar to the rules of section 48(m) of the 

Internal Revenue Code of 1986 (as in effect on 

the day before the date of the enactment of 

the Revenue Reconciliation Act of 1990). 

SEC. 104. ENERGY CREDIT FOR SMALL WIND 

PROPERTY. 

(a) IN GENERAL.—Section 48(a)(3)(A), as 

amended by section 103, is amended by striking ‘‘or’’ at the end of clause (iv), by adding 

‘‘or’’ at the end of clause (v), and by inserting after clause (v) the following new clause: 

‘‘(vi) qualified small wind energy property,’’. 

(b) 30 PERCENT CREDIT.—Section 

48(a)(2)(A)(i) is amended by striking ‘‘and’’ at 

the end of subclause (II) and by inserting 

after subclause (III) the following new subclause: 

‘‘(IV) qualified small wind energy property, 

and’’. 

(c) QUALIFIED SMALL WIND ENERGY PROPERTY.—Section 48(c), as amended by section 

103, is amended by adding at the end the following new paragraph: 

‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY.— 

‘‘(A) IN GENERAL.—The term ‘qualified 

small wind energy property’ means property 

which uses a qualifying small wind turbine 

to generate electricity. 

‘‘(B) LIMITATION.—In the case of qualified 

small wind energy property placed in service 

during the taxable year, the credit otherwise 

determined under subsection (a)(1) for such 

year with respect to all such property of the 

taxpayer shall not exceed $4,000. 

‘‘(C) QUALIFYING SMALL WIND TURBINE.—The 

term ‘qualifying small wind turbine’ means a 

wind turbine which has a nameplate capacity 

of not more than 100 kilowatts. 

‘‘(D) TERMINATION.—The term ‘qualified 

small wind energy property’ shall not include any property for any period after December 31, 2016.’’. 

(d) CONFORMING AMENDMENT.—Section 

48(a)(1), as amended by section 103, is amended by striking ‘‘paragraphs (1)(B), (2)(B), and 

(3)(B)’’ and inserting ‘‘paragraphs (1)(B), 

(2)(B), (3)(B), and (4)(B)’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to periods 

after the date of the enactment of this Act, 

in taxable years ending after such date, 

under rules similar to the rules of section 

48(m) of the Internal Revenue Code of 1986 

(as in effect on the day before the date of the 

enactment of the Revenue Reconciliation 

Act of 1990). 

SEC. 105. ENERGY CREDIT FOR GEOTHERMAL 

HEAT PUMP SYSTEMS. 

(a) IN GENERAL.—Subparagraph (A) of section 48(a)(3), as amended by this Act, is 

amended by striking ‘‘or’’ at the end of 

clause (v), by inserting ‘‘or’’ at the end of 

clause (vi), and by adding at the end the following new clause: 

‘‘(vii) equipment which uses the ground or 

ground water as a thermal energy source to 

heat a structure or as a thermal energy sink 

to cool a structure, but only with respect to 

periods ending before January 1, 2017,’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to periods 

after the date of the enactment of this Act, 

in taxable years ending after such date, 

under rules similar to the rules of section 

48(m) of the Internal Revenue Code of 1986 

(as in effect on the day before the date of the 

enactment of the Revenue Reconciliation 

Act of 1990). 

SEC. 106. CREDIT FOR RESIDENTIAL ENERGY EFFICIENT PROPERTY. 

(a) EXTENSION.—Section 25D(g) is amended 

by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2016’’. 

(b) REMOVAL OF LIMITATION FOR SOLAR

ELECTRIC PROPERTY.— 

(1) IN GENERAL.—Section 25D(b)(1), as 

amended by subsections (c) and (d), is 

amended— 

(A) by striking subparagraph (A), and 

(B) by redesignating subparagraphs (B) 

through (E) as subparagraphs (A) through 

and (D), respectively. 

(2) CONFORMING AMENDMENT.—Section 

25D(e)(4)(A), as amended by subsections (c) 

and (d), is amended— 

(A) by striking clause (i), and 

(B) by redesignating clauses (ii) through 

(v) as clauses (i) and (iv), respectively. 

(c) CREDIT FOR RESIDENTIAL WIND PROPERTY.— 

(1) IN GENERAL.—Section 25D(a) is amended 

by striking ‘‘and’’ at the end of paragraph 

(2), by striking the period at the end of paragraph (3) and inserting ‘‘, and’’, and by adding at the end the following new paragraph: 

‘‘(4) 30 percent of the qualified small wind 

energy property expenditures made by the 

taxpayer during such year.’’. 

(2) LIMITATION.—Section 25D(b)(1) is 

amended by striking ‘‘and’’ at the end of subparagraph (B), by striking the period at the 

end of subparagraph (C) and inserting ‘‘, 

and’’, and by adding at the end the following 

new subparagraph: 

‘‘(D) $500 with respect to each half kilowatt 

of capacity (not to exceed $4,000) of wind turbines for which qualified small wind energy 

property expenditures are made.’’. 

(3) QUALIFIED SMALL WIND ENERGY PROPERTY EXPENDITURES.— 

(A) IN GENERAL.—Section 25D(d) is amended by adding at the end the following new 

paragraph: 

‘‘(4) QUALIFIED SMALL WIND ENERGY PROPERTY EXPENDITURE.—The term ‘qualified 

small wind energy property expenditure’ 

means an expenditure for property which 

uses a wind turbine to generate electricity 

for use in connection with a dwelling unit located in the United States and used as a residence by the taxpayer.’’. 

(B) NO DOUBLE BENEFIT.—Section 45(d)(1) is 

amended by adding at the end the following 

new sentence: ‘‘Such term shall not include 

any facility with respect to which any qualified small wind energy property expenditure 

(as defined in subsection (d)(4) of section 

25D) is taken into account in determining 

the credit under such section.’’. 

(4) MAXIMUM EXPENDITURES IN CASE OF

JOINT OCCUPANCY.—Section 25D(e)(4)(A) is 

amended by striking ‘‘and’’ at the end of 

clause (ii), by striking the period at the end 

of clause (iii) and inserting ‘‘, and’’, and by 

adding at the end the following new clause: 

‘‘(iv) $1,667 in the case of each half kilowatt of capacity (not to exceed $13,333) of 

wind turbines for which qualified small wind 

energy property expenditures are made.’’. 

(d) CREDIT FOR GEOTHERMAL HEAT PUMP

SYSTEMS.— 

(1) IN GENERAL.—Section 25D(a), as amended by subsection (c), is amended by striking 

‘‘and’’ at the end of paragraph (3), by striking the period at the end of paragraph (4) and 

inserting ‘‘, and’’, and by adding at the end 

the following new paragraph: 

‘‘(5) 30 percent of the qualified geothermal 

heat pump property expenditures made by 

the taxpayer during such year.’’. 

(2) LIMITATION.—Section 25D(b)(1), as 

amended by subsection (c), is amended by 

striking ‘‘and’’ at the end of subparagraph 

(C), by striking the period at the end of subparagraph (D) and inserting ‘‘, and’’, and by 

adding at the end the following new subparagraph: 

‘‘(E) $2,000 with respect to any qualified 

geothermal heat pump property expenditures.’’. 

(3) QUALIFIED GEOTHERMAL HEAT PUMP

PROPERTY EXPENDITURE.—Section 25D(d), as 

amended by subsection (c), is amended by 

adding at the end the following new paragraph: 

‘‘(5) QUALIFIED GEOTHERMAL HEAT PUMP

PROPERTY EXPENDITURE.— 

‘‘(A) IN GENERAL.—The term ‘qualified geothermal heat pump property expenditure’ 

means an expenditure for qualified geothermal heat pump property installed on or 

in connection with a dwelling unit located in 

the United States and used as a residence by 

the taxpayer. 

‘‘(B) QUALIFIED GEOTHERMAL HEAT PUMP

PROPERTY.—The term ‘qualified geothermal 

heat pump property’ means any equipment 

which— 

‘‘(i) uses the ground or ground water as a 

thermal energy source to heat the dwelling 

unit referred to in subparagraph (A) or as a 

thermal energy sink to cool such dwelling 

unit, and 

‘‘(ii) meets the requirements of the Energy 

Star program which are in effect at the time 

that the expenditure for such equipment is 

made.’’. 

(4) MAXIMUM EXPENDITURES IN CASE OF

JOINT OCCUPANCY.—Section 25D(e)(4)(A), as 

amended by subsection (c), is amended by 

striking ‘‘and’’ at the end of clause (iii), by 

striking the period at the end of clause (iv) 

and inserting ‘‘, and’’, and by adding at the 

end the following new clause: 

‘‘(v) $6,667 in the case of any qualified geothermal heat pump property expenditures.’’. 

(e) CREDIT ALLOWED AGAINST ALTERNATIVE

MINIMUM TAX.— 

(1) IN GENERAL.—Subsection (c) of section 

25D is amended to read as follows: 

‘‘(c) LIMITATION BASED ON AMOUNT OF TAX; 

CARRYFORWARD OF UNUSED CREDIT.— 

‘‘(1) LIMITATION BASED ON AMOUNT OF TAX.— 

In the case of a taxable year to which section 

26(a)(2) does not apply, the credit allowed 

under subsection (a) for the taxable year 

shall not exceed the excess of— 

‘‘(A) the sum of the regular tax liability 

(as defined in section 26(b)) plus the tax imposed by section 55, over 

‘‘(B) the sum of the credits allowable under 

this subpart (other than this section) and 

section 27 for the taxable year. 

‘‘(2) CARRYFORWARD OF UNUSED CREDIT.— 

‘‘(A) RULE FOR YEARS IN WHICH ALL PERSONAL CREDITS ALLOWED AGAINST REGULAR

AND ALTERNATIVE MINIMUM TAX.—In the case 

of a taxable year to which section 26(a)(2) applies, if the credit allowable under subsection (a) exceeds the limitation imposed by 

section 26(a)(2) for such taxable year reduced 

by the sum of the credits allowable under 

this subpart (other than this section), such 

excess shall be carried to the succeeding taxable year and added to the credit allowable 

under subsection (a) for such succeeding taxable year. 

‘‘(B) RULE FOR OTHER YEARS.—In the case 

of a taxable year to which section 26(a)(2) 

does not apply, if the credit allowable under 

subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, 

such excess shall be carried to the succeeding taxable year and added to the credit 

allowable under subsection (a) for such succeeding taxable year.’’. 

(2) CONFORMING AMENDMENTS.— 


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(A) Section 23(b)(4)(B) is amended by inserting ‘‘and section 25D’’ after ‘‘this section’’. 

(B) Section 24(b)(3)(B) is amended by striking ‘‘and 25B’’ and inserting ‘‘, 25B, and 25D’’. 

(C) Section 25B(g)(2) is amended by striking ‘‘section 23’’ and inserting ‘‘sections 23 

and 25D’’. 

(D) Section 26(a)(1) is amended by striking 

‘‘and 25B’’ and inserting ‘‘25B, and 25D’’. 

(f) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as provided in 

paragraph (2), the amendments made by this 

section shall apply to taxable years beginning after December 31, 2007. 

(2) SOLAR ELECTRIC PROPERTY LIMITATION.— 

The amendments made by subsection (b) 

shall apply to taxable years beginning after 

December 31, 2008. 

(3) APPLICATION OF EGTRRA SUNSET.—The 

amendments made by subparagraphs (A) and 

(B) of subsection (e)(2) shall be subject to 

title IX of the Economic Growth and Tax Relief Reconciliation Act of 2001 in the same 

manner as the provisions of such Act to 

which such amendments relate. 

SEC. 107. NEW CLEAN RENEWABLE ENERGY 

BONDS. 

(a) IN GENERAL.—Subpart I of part IV of 

subchapter A of chapter 1 is amended by adding at the end the following new section: 

‘‘SEC. 54C. NEW CLEAN RENEWABLE ENERGY 

BONDS. 

‘‘(a) NEW CLEAN RENEWABLE ENERGY

BOND.—For purposes of this subpart, the 

term ‘new clean renewable energy bond’ 

means any bond issued as part of an issue 

if— 

‘‘(1) 100 percent of the available project 

proceeds of such issue are to be used for capital expenditures incurred by governmental 

bodies, public power providers, or cooperative electric companies for one or more 

qualified renewable energy facilities, 

‘‘(2) the bond is issued by a qualified issuer, 

and 

‘‘(3) the issuer designates such bond for 

purposes of this section. 

‘‘(b) REDUCED CREDIT AMOUNT.—The annual 

credit determined under section 54A(b) with 

respect to any new clean renewable energy 

bond shall be 70 percent of the amount so determined without regard to this subsection. 

‘‘(c) LIMITATION ON AMOUNT OF BONDS DESIGNATED.— 

‘‘(1) IN GENERAL.—The maximum aggregate 

face amount of bonds which may be designated under subsection (a) by any issuer 

shall not exceed the limitation amount allocated under this subsection to such issuer. 

‘‘(2) NATIONAL LIMITATION ON AMOUNT OF

BONDS DESIGNATED.—There is a national new 

clean renewable energy bond limitation of 

$800,000,000 which shall be allocated by the 

Secretary as provided in paragraph (3), except that— 

‘‘(A) not more than 331⁄3 percent thereof 

may be allocated to qualified projects of public power providers, 

‘‘(B) not more than 331⁄3 percent thereof 

may be allocated to qualified projects of governmental bodies, and 

‘‘(C) not more than 331⁄3 percent thereof 

may be allocated to qualified projects of cooperative electric companies. 

‘‘(3) METHOD OF ALLOCATION.— 

‘‘(A) ALLOCATION AMONG PUBLIC POWER PROVIDERS.—After the Secretary determines the 

qualified projects of public power providers 

which are appropriate for receiving an allocation of the national new clean renewable 

energy bond limitation, the Secretary shall, 

to the maximum extent practicable, make 

allocations among such projects in such 

manner that the amount allocated to each 

such project bears the same ratio to the cost 

of such project as the limitation under paragraph (2)(A) bears to the cost of all such 

projects. 

‘‘(B) ALLOCATION AMONG GOVERNMENTAL

BODIES AND COOPERATIVE ELECTRIC COMPANIES.—The Secretary shall make allocations 

of the amount of the national new clean renewable energy bond limitation described in 

paragraphs (2)(B) and (2)(C) among qualified 

projects of governmental bodies and cooperative electric companies, respectively, in such 

manner as the Secretary determines appropriate. 

‘‘(d) DEFINITIONS.—For purposes of this section— 

‘‘(1) QUALIFIED RENEWABLE ENERGY FACILITY.—The term ‘qualified renewable energy 

facility’ means a qualified facility (as determined under section 45(d) without regard to 

paragraphs (8) and (10) thereof and to any 

placed in service date) owned by a public 

power provider, a governmental body, or a 

cooperative electric company. 

‘‘(2) PUBLIC POWER PROVIDER.—The term 

‘public power provider’ means a State utility 

with a service obligation, as such terms are 

defined in section 217 of the Federal Power 

Act (as in effect on the date of the enactment of this paragraph). 

‘‘(3) GOVERNMENTAL BODY.—The term ‘governmental body’ means any State or Indian 

tribal government, or any political subdivision thereof. 

‘‘(4) COOPERATIVE ELECTRIC COMPANY.—The 

term ‘cooperative electric company’ means a 

mutual or cooperative electric company described in section 501(c)(12) or section 

1381(a)(2)(C). 

‘‘(5) CLEAN RENEWABLE ENERGY BOND LENDER.—The term ‘clean renewable energy bond 

lender’ means a lender which is a cooperative 

which is owned by, or has outstanding loans 

to, 100 or more cooperative electric companies and is in existence on February 1, 2002, 

and shall include any affiliated entity which 

is controlled by such lender. 

‘‘(6) QUALIFIED ISSUER.—The term ‘qualified issuer’ means a public power provider, a 

cooperative electric company, a governmental body, a clean renewable energy bond 

lender, or a not-for-profit electric utility 

which has received a loan or loan guarantee 

under the Rural Electrification Act.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Paragraph (1) of section 54A(d) is 

amended to read as follows: 

‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 

‘qualified tax credit bond’ means— 

‘‘(A) a qualified forestry conservation 

bond, or 

‘‘(B) a new clean renewable energy bond, 

which is part of an issue that meets requirements of paragraphs (2), (3), (4), (5), and (6).’’. 

(2) Subparagraph (C) of section 54A(d)(2) is 

amended to read as follows: 

‘‘(C) QUALIFIED PURPOSE.—For purposes of 

this paragraph, the term ‘qualified purpose’ 

means— 

‘‘(i) in the case of a qualified forestry conservation bond, a purpose specified in section 

54B(e), and 

‘‘(ii) in the case of a new clean renewable 

energy bond, a purpose specified in section 

54C(a)(1).’’. 

(3) The table of sections for subpart I of 

part IV of subchapter A of chapter 1 is 

amended by adding at the end the following 

new item: 

‘‘Sec. 54C. Qualified clean renewable energy 

bonds.’’. 

(c) EXTENSION FOR CLEAN RENEWABLE ENERGY BONDS.—Subsection (m) of section 54 is 

amended by striking ‘‘December 31, 2008’’ and 

inserting ‘‘December 31, 2009’’. 

(d) EFFECTIVE DATE.—The amendments 

made by this section shall apply to obligations issued after the date of the enactment 

of this Act. 

SEC. 108. CREDIT FOR STEEL INDUSTRY FUEL. 

(a) TREATMENT AS REFINED COAL.— 

(1) IN GENERAL.—Subparagraph (A) of section 45(c)(7) of the Internal Revenue Code of 

1986 (relating to refined coal), as amended by 

this Act, is amended to read as follows: 

‘‘(A) IN GENERAL.—The term ‘refined coal’ 

means a fuel— 

‘‘(i) which— 

‘‘(I) is a liquid, gaseous, or solid fuel produced from coal (including lignite) or high 

carbon fly ash, including such fuel used as a 

feedstock, 

‘‘(II) is sold by the taxpayer with the reasonable expectation that it will be used for 

purpose of producing steam, 

‘‘(III) is certified by the taxpayer as resulting (when used in the production of steam) in 

a qualified emission reduction, and 

‘‘(IV) is produced in such a manner as to 

result in an increase of at least 50 percent in 

the market value of the refined coal (excluding any increase caused by materials combined or added during the production process), as compared to the value of the feedstock coal, or 

‘‘(ii) which is steel industry fuel.’’. 

(2) STEEL INDUSTRY FUEL DEFINED.—Paragraph (7) of section 45(c) of such Code is 

amended by adding at the end the following 

new subparagraph: 

‘‘(C) STEEL INDUSTRY FUEL.— 

‘‘(i) IN GENERAL.—The term ‘steel industry 

fuel’ means a fuel which— 

‘‘(I) is produced through a process of 

liquifying coal waste sludge and distributing 

it on coal, and 

‘‘(II) is used as a feedstock for the manufacture of coke. 

‘‘(ii) COAL WASTE SLUDGE.—The term ‘coal 

waste sludge’ means the tar decanter sludge 

and related byproducts of the coking process, 

including such materials that have been 

stored in ground, in tanks and in lagoons, 

that have been treated as hazardous wastes 

under applicable Federal environmental 

rules absent liquefaction and processing with 

coal into a feedstock for the manufacture of 

coke.’’. 

(b) CREDIT AMOUNT.— 

(1) IN GENERAL.—Paragraph (8) of section 

45(e) of the Internal Revenue Code of 1986 (relating to refined coal production facilities) is 

amended by adding at the end the following 

new subparagraph 

‘‘(D) SPECIAL RULE FOR STEEL INDUSTRY

FUEL.— 

‘‘(i) IN GENERAL.—In the case of a taxpayer 

who produces steel industry fuel— 

‘‘(I) this paragraph shall be applied separately with respect to steel industry fuel and 

other refined coal, and 

‘‘(II) in applying this paragraph to steel industry fuel, the modifications in clause (ii) 

shall apply. 

‘‘(ii) MODIFICATIONS.— 

‘‘(I) CREDIT AMOUNT.—Subparagraph (A) 

shall be applied by substituting ‘$2 per barrel-of-oil equivalent’ for ‘$4.375 per ton’. 

‘‘(II) CREDIT PERIOD.—In lieu of the 10-year 

period referred to in clauses (i) and (ii)(II) of 

subparagraph (A), the credit period shall be 

the period beginning on the later of the date 

such facility was originally placed in service, 

the date the modifications described in 

clause (iii) were placed in service, or October 

1, 2008, and ending on the later of December 

31, 2009, or the date which is 1 year after the 

date such facility or the modifications described in clause (iii) were placed in service. 

‘‘(III) NO PHASEOUT.—Subparagraph (B) 

shall not apply. 

‘‘(iii) MODIFICATIONS.—The modifications 

described in this clause are modifications to 

an existing facility which allow such facility 

to produce steel industry fuel. 

‘‘(iv) BARREL-OF-OIL EQUIVALENT.—For purposes of this subparagraph, a barrel-of-oil 


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equivalent is the amount of steel industry 

fuel that has a Btu content of 5,800,000 

Btus.’’. 

(2) INFLATION ADJUSTMENT.—Paragraph (2) 

of section 45(b) of such Code is amended by 

inserting ‘‘the $3 amount in subsection 

(e)(8)(D)(ii)(I),’’ after ‘‘subsection (e)(8)(A),’’. 

(c) TERMINATION.—Paragraph (8) of section 

45(d) of the Internal Revenue Code of 1986 (relating to refined coal production facility), as 

amended by this Act, is amended to read as 

follows: 

‘‘(8) REFINED COAL PRODUCTION FACILITY.— 

In the case of a facility that produces refined 

coal, the term ‘refined coal production facility’ means— 

‘‘(A) with respect to a facility producing 

steel industry fuel, any facility (or any 

modification to a facility) which is placed in 

service before January 1, 2010, and 

‘‘(B) with respect to any other facility producing refined coal, any facility placed in 

service after the date of the enactment of 

the American Jobs Creation Act of 2004 and 

before January 1, 2010.’’. 

(d) COORDINATION WITH CREDIT FOR PRODUCING FUEL FROM A NONCONVENTIONAL

SOURCE.— 

(1) IN GENERAL.—Subparagraph (B) of section 45(e)(9) of the Internal Revenue Code of 

1986 is amended— 

(A) by striking ‘‘The term’’ and inserting 

the following: 

‘‘(i) IN GENERAL.—The term’’, and 

(B) by adding at the end the following new 

clause: 

‘‘(ii) EXCEPTION FOR STEEL INDUSTRY

COAL.—In the case of a facility producing 

steel industry fuel, clause (i) shall not apply 

to so much of the refined coal produced at 

such facility as is steel industry fuel.’’. 

(2) NO DOUBLE BENEFIT.—Section 45K(g)(2) 

of such Code is amended by adding at the end 

the following new subparagraph: 

‘‘(E) COORDINATION WITH SECTION 45.—No 

credit shall be allowed with respect to any 

qualified fuel which is steel industry fuel (as 

defined in section 45(c)(7)) if a credit is allowed to the taxpayer for such fuel under 

section 45.’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to fuel produced and sold after September 30, 2008. 

SEC. 109. SPECIAL RULE TO IMPLEMENT FERC 

AND STATE ELECTRIC RESTRUCTURING POLICY. 

(a) EXTENSION FOR QUALIFIED ELECTRIC

UTILITIES.— 

(1) IN GENERAL.—Paragraph (3) of section 

451(i) is amended by inserting ‘‘(before January 1, 2010, in the case of a qualified electric 

utility)’’ after ‘‘January 1, 2008’’. 

(2) QUALIFIED ELECTRIC UTILITY.—Subsection (i) of section 451 is amended by redesignating paragraphs (6) through (10) as paragraphs (7) through (11), respectively, and by 

inserting after paragraph (5) the following 

new paragraph: 

‘‘(6) QUALIFIED ELECTRIC UTILITY.—For purposes of this subsection, the term ‘qualified 

electric utility’ means a person that, as of 

the date of the qualifying electric transmission transaction, is vertically integrated, 

in that it is both— 

‘‘(A) a transmitting utility (as defined in 

section 3(23) of the Federal Power Act (16 

U.S.C. 796(23))) with respect to the transmission facilities to which the election 

under this subsection applies, and 

‘‘(B) an electric utility (as defined in section 3(22) of the Federal Power Act (16 U.S.C. 

796(22))).’’. 

(b) EXTENSION OF PERIOD FOR TRANSFER OF

OPERATIONAL CONTROL AUTHORIZED BY

FERC.—Clause (ii) of section 451(i)(4)(B) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘the date which is 4 years after the 

close of the taxable year in which the transaction occurs’’. 

(c) PROPERTY LOCATED OUTSIDE THE UNITED

STATES NOT TREATED AS EXEMPT UTILITY

PROPERTY.—Paragraph (5) of section 451(i) is 

amended by adding at the end the following 

new subparagraph: 

‘‘(C) EXCEPTION FOR PROPERTY LOCATED

OUTSIDE THE UNITED STATES.—The term ‘exempt utility property’ shall not include any 

property which is located outside the United 

States.’’. 

(d) EFFECTIVE DATES.— 

(1) EXTENSION.—The amendments made by 

subsection (a) shall apply to transactions 

after December 31, 2007. 

(2) TRANSFERS OF OPERATIONAL CONTROL.— 

The amendment made by subsection (b) shall 

take effect as if included in section 909 of the 

American Jobs Creation Act of 2004. 

(3) EXCEPTION FOR PROPERTY LOCATED OUTSIDE THE UNITED STATES.—The amendment 

made by subsection (c) shall apply to transactions after the date of the enactment of 

this Act. 

Subtitle B—Carbon Mitigation and Coal 

Provisions 

SEC. 111. EXPANSION AND MODIFICATION OF ADVANCED COAL PROJECT INVESTMENT CREDIT. 

(a) MODIFICATION OF CREDIT AMOUNT.—Section 48A(a) 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) 30 percent of the qualified investment 

for such taxable year in the case of projects 

described in clause (iii) of subsection 

(d)(3)(B).’’. 

(b) EXPANSION OF AGGREGATE CREDITS.— 

Section 48A(d)(3)(A) is amended by striking 

‘‘$1,300,000,000’’ and inserting ‘‘$2,550,000,000’’. 

(c) AUTHORIZATION OF ADDITIONAL

PROJECTS.— 

(1) IN GENERAL.—Subparagraph (B) of section 48A(d)(3) is amended to read as follows: 

‘‘(B) PARTICULAR PROJECTS.—Of the dollar 

amount in subparagraph (A), the Secretary 

is authorized to certify— 

‘‘(i) $800,000,000 for integrated gasification 

combined cycle projects the application for 

which is submitted during the period described in paragraph (2)(A)(i), 

‘‘(ii) $500,000,000 for projects which use 

other advanced coal-based generation technologies the application for which is submitted during the period described in paragraph (2)(A)(i), and 

‘‘(iii) $1,250,000,000 for advanced coal-based 

generation technology projects the application for which is submitted during the period 

described in paragraph (2)(A)(ii).’’. 

(2) APPLICATION PERIOD FOR ADDITIONAL

PROJECTS.—Subparagraph (A) of section 

48A(d)(2) is amended to read as follows: 

‘‘(A) APPLICATION PERIOD.—Each applicant 

for certification under this paragraph shall 

submit an application meeting the requirements of subparagraph (B). An applicant 

may only submit an application— 

‘‘(i) for an allocation from the dollar 

amount specified in clause (i) or (ii) of paragraph (3)(B) during the 3-year period beginning on the date the Secretary establishes 

the program under paragraph (1), and 

‘‘(ii) for an allocation from the dollar 

amount specified in paragraph (3)(B)(iii) during the 3-year period beginning at the earlier 

of the termination of the period described in 

clause (i) or the date prescribed by the Secretary.’’. 

(3) CAPTURE AND SEQUESTRATION OF CARBON

DIOXIDE EMISSIONS REQUIREMENT.— 

(A) IN GENERAL.—Section 48A(e)(1) is 

amended by striking ‘‘and’’ at the end of subparagraph (E), by striking the period at the 

end of subparagraph (F) and inserting ‘‘; 

and’’, and by adding at the end the following 

new subparagraph: 

‘‘(G) in the case of any project the application for which is submitted during the period 

described in subsection (d)(2)(A)(ii), the 

project includes equipment which separates 

and sequesters at least 65 percent (70 percent 

in the case of an application for reallocated 

credits under subsection (d)(4)) of such 

project’s total carbon dioxide emissions.’’. 

(B) HIGHEST PRIORITY FOR PROJECTS WHICH

SEQUESTER CARBON DIOXIDE EMISSIONS.—Section 48A(e)(3) is amended by striking ‘‘and’’ 

at the end of subparagraph (A)(iii), by striking the period at the end of subparagraph 

(B)(iii) and inserting ‘‘, and’’, and by adding 

at the end the following new subparagraph: 

‘‘(C) give highest priority to projects with 

the greatest separation and sequestration 

percentage of total carbon dioxide emissions.’’. 

(C) RECAPTURE OF CREDIT FOR FAILURE TO

SEQUESTER.—Section 48A is amended by adding at the end the following new subsection: 

‘‘(i) RECAPTURE OF CREDIT FOR FAILURE TO

SEQUESTER.—The Secretary shall provide for 

recapturing the benefit of any credit allowable under subsection (a) with respect to any 

project which fails to attain or maintain the 

separation and sequestration requirements 

of subsection (e)(1)(G).’’. 

(4) ADDITIONAL PRIORITY FOR RESEARCH

PARTNERSHIPS.—Section 48A(e)(3)(B), as 

amended by paragraph (3)(B), is amended— 

(A) by striking ‘‘and’’ at the end of clause 

(ii), 

(B) by redesignating clause (iii) as clause 

(iv), and 

(C) by inserting after clause (ii) the following new clause: 

‘‘(iii) applicant participants who have a research partnership with an eligible educational institution (as defined in section 

529(e)(5)), and’’. 

(5) CLERICAL AMENDMENT.—Section 

48A(e)(3) is amended by striking ‘‘INTEGRATED GASIFICATION COMBINED CYCLE’’ in the 

heading and inserting ‘‘CERTAIN’’. 

(d) DISCLOSURE OF ALLOCATIONS.—Section 

48A(d) is amended by adding at the end the 

following new paragraph: 

‘‘(5) DISCLOSURE OF ALLOCATIONS.—The Secretary shall, upon making a certification 

under this subsection or section 48B(d), publicly disclose the identity of the applicant 

and the amount of the credit certified with 

respect to such applicant.’’. 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall apply to credits 

the application for which is submitted during the period described in section 

48A(d)(2)(A)(ii) of the Internal Revenue Code 

of 1986 and which are allocated or reallocated 

after the date of the enactment of this Act. 

(2) DISCLOSURE OF ALLOCATIONS.—The 

amendment made by subsection (d) shall 

apply to certifications made after the date of 

the enactment of this Act. 

(3) CLERICAL AMENDMENT.—The amendment 

made by subsection (c)(5) shall take effect as 

if included in the amendment made by section 1307(b) of the Energy Tax Incentives Act 

of 2005. 

SEC. 112. EXPANSION AND MODIFICATION OF 

COAL GASIFICATION INVESTMENT 

CREDIT. 

(a) MODIFICATION OF CREDIT AMOUNT.—Section 48B(a) is amended by inserting ‘‘(30 percent in the case of credits allocated under 

subsection (d)(1)(B))’’ after ‘‘20 percent’’. 

(b) EXPANSION OF AGGREGATE CREDITS.— 

Section 48B(d)(1) is amended by striking 

‘‘shall not exceed $350,000,000’’ and all that 

follows and inserting ‘‘shall not exceed— 

‘‘(A) $350,000,000, plus 

‘‘(B) $250,000,000 for qualifying gasification 

projects that include equipment which separates and sequesters at least 75 percent of 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10357 

such project’s total carbon dioxide emissions.’’. 

(c) RECAPTURE OF CREDIT FOR FAILURE TO

SEQUESTER.—Section 48B is amended by adding at the end the following new subsection: 

‘‘(f) RECAPTURE OF CREDIT FOR FAILURE TO

SEQUESTER.—The Secretary shall provide for 

recapturing the benefit of any credit allowable under subsection (a) with respect to any 

project which fails to attain or maintain the 

separation and sequestration requirements 

for such project under subsection (d)(1).’’. 

(d) SELECTION PRIORITIES.—Section 48B(d) 

is amended by adding at the end the following new paragraph: 

‘‘(4) SELECTION PRIORITIES.—In determining 

which qualifying gasification projects to certify under this section, the Secretary shall— 

‘‘(A) give highest priority to projects with 

the greatest separation and sequestration 

percentage of total carbon dioxide emissions, 

and 

‘‘(B) give high priority to applicant participants who have a research partnership 

with an eligible educational institution (as 

defined in section 529(e)(5)).’’. 

(e) ELIGIBLE PROJECTS INCLUDE TRANSPORTATION GRADE LIQUID FUELS.—Section 

48B(c)(7) (defining eligible entity) is amended 

by striking ‘‘and’’ at the end of subparagraph 

(F), by striking the period at the end of subparagraph (G) and inserting ‘‘, and’’, and by 

adding at the end the following new subparagraph: 

‘‘(H) transportation grade liquid fuels.’’. 

(f) EFFECTIVE DATE.—The amendments 

made by this section shall apply to credits 

described in section 48B(d)(1)(B) of the Internal Revenue Code of 1986 which are allocated 

or reallocated after the date of the enactment of this Act. 

SEC. 113. TEMPORARY INCREASE IN COAL EXCISE 

TAX; FUNDING OF BLACK LUNG DISABILITY TRUST FUND. 

(a) EXTENSION OF TEMPORARY INCREASE.— 

Paragraph (2) of section 4121(e) is amended— 

(1) by striking ‘‘January 1, 2014’’ in subparagraph (A) and inserting ‘‘December 31, 

2018’’, and 

(2) by striking ‘‘January 1 after 1981’’ in 

subparagraph (B) and inserting ‘‘December 31 

after 2007’’. 

(b) RESTRUCTURING OF TRUST FUND DEBT.— 

(1) DEFINITIONS.—For purposes of this subsection— 

(A) MARKET VALUE OF THE OUTSTANDING REPAYABLE ADVANCES, PLUS ACCRUED INTEREST.—The term ‘‘market value of the outstanding repayable advances, plus accrued 

interest’’ means the present value (determined by the Secretary of the Treasury as of 

the refinancing date and using the Treasury 

rate as the discount rate) of the stream of 

principal and interest payments derived assuming that each repayable advance that is 

outstanding on the refinancing date is due 

on the 30th anniversary of the end of the fiscal year in which the advance was made to 

the Trust Fund, and that all such principal 

and interest payments are made on September 30 of the applicable fiscal year. 

(B) REFINANCING DATE.—The term ‘‘refinancing date’’ means the date occurring 2 

days after the enactment of this Act. 

(C) REPAYABLE ADVANCE.—The term ‘‘repayable advance’’ means an amount that has 

been appropriated to the Trust Fund in order 

to make benefit payments and other expenditures that are authorized under section 9501 

of the Internal Revenue Code of 1986 and are 

required to be repaid when the Secretary of 

the Treasury determines that monies are 

available in the Trust Fund for such purpose. 

(D) TREASURY RATE.—The term ‘‘Treasury 

rate’’ means a rate determined by the Secretary of the Treasury, taking into consideration current market yields on outstanding 

marketable obligations of the United States 

of comparable maturities. 

(E) TREASURY 1-YEAR RATE.—The term 

‘‘Treasury 1-year rate’’ means a rate determined by the Secretary of the Treasury, taking into consideration current market yields 

on outstanding marketable obligations of 

the United States with remaining periods to 

maturity of approximately 1 year, to have 

been in effect as of the close of business 1 

business day prior to the date on which the 

Trust Fund issues obligations to the Secretary of the Treasury under paragraph 

(2)(B). 

(2) REFINANCING OF OUTSTANDING PRINCIPAL

OF REPAYABLE ADVANCES AND UNPAID INTEREST ON SUCH ADVANCES.— 

(A) TRANSFER TO GENERAL FUND.—On the 

refinancing date, the Trust Fund shall repay 

the market value of the outstanding repayable advances, plus accrued interest, by 

transferring into the general fund of the 

Treasury the following sums: 

(i) The proceeds from obligations that the 

Trust Fund shall issue to the Secretary of 

the Treasury in such amounts as the Secretaries of Labor and the Treasury shall determine and bearing interest at the Treasury 

rate, and that shall be in such forms and denominations and be subject to such other 

terms and conditions, including maturity, as 

the Secretary of the Treasury shall prescribe. 

(ii) All, or that portion, of the appropriation made to the Trust Fund pursuant to 

paragraph (3) that is needed to cover the difference defined in that paragraph. 

(B) REPAYMENT OF OBLIGATIONS.—In the 

event that the Trust Fund is unable to repay 

the obligations that it has issued to the Secretary of the Treasury under subparagraph 

(A)(i) and this subparagraph, or is unable to 

make benefit payments and other authorized 

expenditures, the Trust Fund shall issue obligations to the Secretary of the Treasury in 

such amounts as may be necessary to make 

such repayments, payments, and expenditures, with a maturity of 1 year, and bearing 

interest at the Treasury 1-year rate. These 

obligations shall be in such forms and denominations and be subject to such other 

terms and conditions as the Secretary of the 

Treasury shall prescribe. 

(C) AUTHORITY TO ISSUE OBLIGATIONS.—The 

Trust Fund is authorized to issue obligations 

to the Secretary of the Treasury under subparagraphs (A)(i) and (B). The Secretary of 

the Treasury is authorized to purchase such 

obligations of the Trust Fund. For the purposes of making such purchases, the Secretary of the Treasury may use as a public 

debt transaction the proceeds from the sale 

of any securities issued under chapter 31 of 

title 31, United States Code, and the purposes for which securities may be issued 

under such chapter are extended to include 

any purchase of such Trust Fund obligations 

under this subparagraph. 

(3) ONE-TIME APPROPRIATION.—There is 

hereby appropriated to the Trust Fund an 

amount sufficient to pay to the general fund 

of the Treasury the difference between— 

(A) the market value of the outstanding repayable advances, plus accrued interest; and 

(B) the proceeds from the obligations 

issued by the Trust Fund to the Secretary of 

the Treasury under paragraph (2)(A)(i). 

(4) PREPAYMENT OF TRUST FUND OBLIGATIONS.—The Trust Fund is authorized to 

repay any obligation issued to the Secretary 

of the Treasury under subparagraphs (A)(i) 

and (B) of paragraph (2) prior to its maturity 

date by paying a prepayment price that 

would, if the obligation being prepaid (including all unpaid interest accrued thereon 

through the date of prepayment) were purchased by a third party and held to the maturity date of such obligation, produce a 

yield to the third-party purchaser for the period from the date of purchase to the maturity date of such obligation substantially 

equal to the Treasury yield on outstanding 

marketable obligations of the United States 

having a comparable maturity to this period. 

SEC. 114. SPECIAL RULES FOR REFUND OF THE 

COAL EXCISE TAX TO CERTAIN COAL 

PRODUCERS AND EXPORTERS. 

(a) REFUND.— 

(1) COAL PRODUCERS.— 

(A) IN GENERAL.—Notwithstanding subsections (a)(1) and (c) of section 6416 and section 6511 of the Internal Revenue Code of 

1986, if— 

(i) a coal producer establishes that such 

coal producer, or a party related to such coal 

producer, exported coal produced by such 

coal producer to a foreign country or shipped 

coal produced by such coal producer to a possession of the United States, or caused such 

coal to be exported or shipped, the export or 

shipment of which was other than through 

an exporter who meets the requirements of 

paragraph (2), 

(ii) such coal producer filed an excise tax 

return on or after October 1, 1990, and on or 

before the date of the enactment of this Act, 

and 

(iii) such coal producer files a claim for refund with the Secretary not later than the 

close of the 30-day period beginning on the 

date of the enactment of this Act, 

then the Secretary shall pay to such coal 

producer an amount equal to the tax paid 

under section 4121 of such Code on such coal 

exported or shipped by the coal producer or 

a party related to such coal producer, or 

caused by the coal producer or a party related to such coal producer to be exported or 

shipped. 

(B) SPECIAL RULES FOR CERTAIN TAXPAYERS.—For purposes of this section— 

(i) IN GENERAL.—If a coal producer or a 

party related to a coal producer has received 

a judgment described in clause (iii), such 

coal producer shall be deemed to have established the export of coal to a foreign country 

or shipment of coal to a possession of the 

United States under subparagraph (A)(i). 

(ii) AMOUNT OF PAYMENT.—If a taxpayer described in clause (i) is entitled to a payment 

under subparagraph (A), the amount of such 

payment shall be reduced by any amount 

paid pursuant to the judgment described in 

clause (iii). 

(iii) JUDGMENT DESCRIBED.—A judgment is 

described in this subparagraph if such judgment— 

(I) is made by a court of competent jurisdiction within the United States, 

(II) relates to the constitutionality of any 

tax paid on exported coal under section 4121 

of the Internal Revenue Code of 1986, and 

(III) is in favor of the coal producer or the 

party related to the coal producer. 

(2) EXPORTERS.—Notwithstanding subsections (a)(1) and (c) of section 6416 and section 6511 of the Internal Revenue Code of 

1986, and a judgment described in paragraph 

(1)(B)(iii) of this subsection, if— 

(A) an exporter establishes that such exporter exported coal to a foreign country or 

shipped coal to a possession of the United 

States, or caused such coal to be so exported 

or shipped, 

(B) such exporter filed a tax return on or 

after October 1, 1990, and on or before the 

date of the enactment of this Act, and 

(C) such exporter files a claim for refund 

with the Secretary not later than the close 

of the 30-day period beginning on the date of 

the enactment of this Act, 

then the Secretary shall pay to such exporter an amount equal to $0.825 per ton of 

such coal exported by the exporter or caused 

to be exported or shipped, or caused to be exported or shipped, by the exporter. 


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S10358 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(b) LIMITATIONS.—Subsection (a) shall not 

apply with respect to exported coal if a settlement with the Federal Government has 

been made with and accepted by, the coal 

producer, a party related to such coal producer, or the exporter, of such coal, as of the 

date that the claim is filed under this section with respect to such exported coal. For 

purposes of this subsection, the term ‘‘settlement with the Federal Government’’ shall 

not include any settlement or stipulation entered into as of the date of the enactment of 

this Act, the terms of which contemplate a 

judgment concerning which any party has 

reserved the right to file an appeal, or has 

filed an appeal. 

(c) SUBSEQUENT REFUND PROHIBITED.—No 

refund shall be made under this section to 

the extent that a credit or refund of such tax 

on such exported or shipped coal has been 

paid to any person. 

(d) DEFINITIONS.—For purposes of this section— 

(1) COAL PRODUCER.—The term ‘‘coal producer’’ means the person in whom is vested 

ownership of the coal immediately after the 

coal is severed from the ground, without regard to the existence of any contractual arrangement for the sale or other disposition 

of the coal or the payment of any royalties 

between the producer and third parties. The 

term includes any person who extracts coal 

from coal waste refuse piles or from the silt 

waste product which results from the wet 

washing (or similar processing) of coal. 

(2) EXPORTER.—The term ‘‘exporter’’ means 

a person, other than a coal producer, who 

does not have a contract, fee arrangement, 

or any other agreement with a producer or 

seller of such coal to export or ship such coal 

to a third party on behalf of the producer or 

seller of such coal and— 

(A) is indicated in the shipper’s export declaration or other documentation as the exporter of record, or 

(B) actually exported such coal to a foreign 

country or shipped such coal to a possession 

of the United States, or caused such coal to 

be so exported or shipped. 

(3) RELATED PARTY.—The term ‘‘a party related to such coal producer’’ means a person 

who— 

(A) is related to such coal producer 

through any degree of common management, 

stock ownership, or voting control, 

(B) is related (within the meaning of section 144(a)(3) of the Internal Revenue Code of 

1986) to such coal producer, or 

(C) has a contract, fee arrangement, or any 

other agreement with such coal producer to 

sell such coal to a third party on behalf of 

such coal producer. 

(4) SECRETARY.—The term ‘‘Secretary’’ 

means the Secretary of Treasury or the Secretary’s designee. 

(e) TIMING OF REFUND.—With respect to 

any claim for refund filed pursuant to this 

section, the Secretary shall determine 

whether the requirements of this section are 

met not later than 180 days after such claim 

is filed. If the Secretary determines that the 

requirements of this section are met, the 

claim for refund shall be paid not later than 

180 days after the Secretary makes such determination. 

(f) INTEREST.—Any refund paid pursuant to 

this section shall be paid by the Secretary 

with interest from the date of overpayment 

determined by using the overpayment rate 

and method under section 6621 of the Internal Revenue Code of 1986. 

(g) DENIAL OF DOUBLE BENEFIT.—The payment under subsection (a) with respect to 

any coal shall not exceed— 

(1) in the case of a payment to a coal producer, the amount of tax paid under section 

4121 of the Internal Revenue Code of 1986 

with respect to such coal by such coal producer or a party related to such coal producer, and 

(2) in the case of a payment to an exporter, 

an amount equal to $0.825 per ton with respect to such coal exported by the exporter 

or caused to be exported by the exporter. 

(h) APPLICATION OF SECTION.—This section 

applies only to claims on coal exported or 

shipped on or after October 1, 1990, through 

the date of the enactment of this Act. 

(i) STANDING NOT CONFERRED.— 

(1) EXPORTERS.—With respect to exporters, 

this section shall not confer standing upon 

an exporter to commence, or intervene in, 

any judicial or administrative proceeding 

concerning a claim for refund by a coal producer of any Federal or State tax, fee, or 

royalty paid by the coal producer. 

(2) COAL PRODUCERS.—With respect to coal 

producers, this section shall not confer 

standing upon a coal producer to commence, 

or intervene in, any judicial or administrative proceeding concerning a claim for refund by an exporter of any Federal or State 

tax, fee, or royalty paid by the producer and 

alleged to have been passed on to an exporter. 

SEC. 115. TAX CREDIT FOR CARBON DIOXIDE SEQUESTRATION. 

(a) IN GENERAL.—Subpart D of part IV of 

subchapter A of chapter 1 (relating to business credits) is amended by adding at the end 

the following new section: 

‘‘SEC. 45Q. CREDIT FOR CARBON DIOXIDE SEQUESTRATION. 

‘‘(a) GENERAL RULE.—For purposes of section 38, the carbon dioxide sequestration 

credit for any taxable year is an amount 

equal to the sum of— 

‘‘(1) $20 per metric ton of qualified carbon 

dioxide which is— 

‘‘(A) captured by the taxpayer at a qualified facility, and 

‘‘(B) disposed of by the taxpayer in secure 

geological storage, and 

‘‘(2) $10 per metric ton of qualified carbon 

dioxide which is— 

‘‘(A) captured by the taxpayer at a qualified facility, and 

‘‘(B) used by the taxpayer as a tertiary 

injectant in a qualified enhanced oil or natural gas recovery project. 

‘‘(b) QUALIFIED CARBON DIOXIDE.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘qualified carbon dioxide’ means carbon dioxide captured 

from an industrial source which— 

‘‘(A) would otherwise be released into the 

atmosphere as industrial emission of greenhouse gas, and 

‘‘(B) is measured at the source of capture 

and verified at the point of disposal or injection. 

‘‘(2) RECYCLED CARBON DIOXIDE.—The term 

‘qualified carbon dioxide’ includes the initial 

deposit of captured carbon dioxide used as a 

tertiary injectant. Such term does not include carbon dioxide that is re-captured, recycled, and re-injected as part of the enhanced oil and natural gas recovery process. 

‘‘(c) QUALIFIED FACILITY.—For purposes of 

this section, the term ‘qualified facility’ 

means any industrial facility— 

‘‘(1) which is owned by the taxpayer, 

‘‘(2) at which carbon capture equipment is 

placed in service, and 

‘‘(3) which captures not less than 500,000 

metric tons of carbon dioxide during the taxable year. 

‘‘(d) SPECIAL RULES AND OTHER DEFINITIONS.—For purposes of this section— 

‘‘(1) ONLY CARBON DIOXIDE CAPTURED AND

DISPOSED OF OR USED WITHIN THE UNITED

STATES TAKEN INTO ACCOUNT.—The credit 

under this section shall apply only with respect to qualified carbon dioxide the capture 

and disposal or use of which is within— 

‘‘(A) the United States (within the meaning of section 638(1)), or 

‘‘(B) a possession of the United States 

(within the meaning of section 638(2)). 

‘‘(2) SECURE GEOLOGICAL STORAGE.—The 

Secretary, in consultation with the Administrator of the Environmental Protection 

Agency, shall establish regulations for determining adequate security measures for the 

geological storage of carbon dioxide under 

subsection (a)(1)(B) such that the carbon dioxide does not escape into the atmosphere. 

Such term shall include storage at deep saline formations and unminable coal seems 

under such conditions as the Secretary may 

determine under such regulations. 

‘‘(3) TERTIARY INJECTANT.—The term ‘tertiary injectant’ has the same meaning as 

when used within section 193(b)(1). 

‘‘(4) QUALIFIED ENHANCED OIL OR NATURAL

GAS RECOVERY PROJECT.—The term ‘qualified 

enhanced oil or natural gas recovery project’ 

has the meaning given the term ‘qualified 

enhanced oil recovery project’ by section 

43(c)(2), by substituting ‘crude oil or natural 

gas’ for ‘crude oil’ in subparagraph (A)(i) 

thereof. 

‘‘(5) CREDIT ATTRIBUTABLE TO TAXPAYER.— 

Any credit under this section shall be attributable to the person that captures and physically or contractually ensures the disposal 

of or the use as a tertiary injectant of the 

qualified carbon dioxide, except to the extent provided in regulations prescribed by 

the Secretary. 

‘‘(6) RECAPTURE.—The Secretary shall, by 

regulations, provide for recapturing the benefit of any credit allowable under subsection 

(a) with respect to any qualified carbon dioxide which ceases to be captured, disposed of, 

or used as a tertiary injectant in a manner 

consistent with the requirements of this section. 

‘‘(7) INFLATION ADJUSTMENT.—In the case of 

any taxable year beginning in a calendar 

year after 2009, there shall be substituted for 

each dollar amount contained in subsection 

(a) an amount equal to the product of— 

‘‘(A) such dollar amount, multiplied by 

‘‘(B) the inflation adjustment factor for 

such calendar year determined under section 

43(b)(3)(B) for such calendar year, determined by substituting ‘2008’ for ‘1990’. 

‘‘(e) APPLICATION OF SECTION.—The credit 

under this section shall apply with respect to 

qualified carbon dioxide before the end of the 

calendar year in which the Secretary, in consultation with the Administrator of the Environmental Protection Agency, certifies 

that 75,000,000 metric tons of qualified carbon 

dioxide have been captured and disposed of 

or used as a tertiary injectant.’’. 

(b) CONFORMING AMENDMENT.—Section 38(b) 

(relating to general business credit) is 

amended by striking ‘‘plus’’ at the end of 

paragraph (32), by striking the period at the 

end of paragraph (33) and inserting ‘‘, plus’’, 

and by adding at the end of following new 

paragraph: 

‘‘(34) the carbon dioxide sequestration 

credit determined under section 45Q(a).’’. 

(c) CLERICAL AMENDMENT.—The table of 

sections for subpart B of part IV of subchapter A of chapter 1 (relating to other 

credits) is amended by adding at the end the 

following new section: 

‘‘Sec. 45Q. Credit for carbon dioxide sequestration.’’. 

(d) EFFECTIVE DATE.—The amendments 

made by this section shall apply to carbon 

dioxide captured after the date of the enactment of this Act. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10359 

SEC. 116. CERTAIN INCOME AND GAINS RELATING TO INDUSTRIAL SOURCE CARBON DIOXIDE TREATED AS QUALIFYING INCOME FOR PUBLICLY 

TRADED PARTNERSHIPS. 

(a) IN GENERAL.—Subparagraph (E) of section 7704(d)(1) (defining qualifying income) is 

amended by inserting ‘‘or industrial source 

carbon dioxide’’ after ‘‘timber)’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall take effect on the 

date of the enactment of this Act, in taxable 

years ending after such date. 

SEC. 117. CARBON AUDIT OF THE TAX CODE. 

(a) STUDY.—The Secretary of the Treasury 

shall enter into an agreement with the National Academy of Sciences to undertake a 

comprehensive review of the Internal Revenue Code of 1986 to identify the types of and 

specific tax provisions that have the largest 

effects on carbon and other greenhouse gas 

emissions and to estimate the magnitude of 

those effects. 

(b) REPORT.—Not later than 2 years after 

the date of enactment of this Act, the National Academy of Sciences shall submit to 

Congress a report containing the results of 

study authorized under this section. 

(c) AUTHORIZATION OF APPROPRIATIONS.— 

There is authorized to be appropriated to 

carry out this section $1,500,000 for the period 

of fiscal years 2009 and 2010. 

TITLE II—TRANSPORTATION AND 

DOMESTIC FUEL SECURITY PROVISIONS 

SEC. 201. INCLUSION OF CELLULOSIC BIOFUEL 

IN BONUS DEPRECIATION FOR BIOMASS ETHANOL PLANT PROPERTY. 

(a) IN GENERAL.—Paragraph (3) of section 

168(l) is amended to read as follows: 

‘‘(3) CELLULOSIC BIOFUEL.—The term ‘cellulosic biofuel’ means any liquid fuel which 

is produced from any lignocellulosic or 

hemicellulosic matter that is available on a 

renewable or recurring basis.’’. 

(b) CONFORMING AMENDMENTS.—Subsection 

(l) of section 168 is amended— 

(1) by striking ‘‘cellulosic biomass ethanol’’ each place it appears and inserting 

‘‘cellulosic biofuel’’, 

(2) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ in the heading of such subsection and 

inserting ‘‘CELLULOSIC BIOFUEL’’, and 

(3) by striking ‘‘CELLULOSIC BIOMASS ETHANOL’’ in the heading of paragraph (2) thereof 

and inserting ‘‘CELLULOSIC BIOFUEL’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to property 

placed in service after the date of the enactment of this Act, in taxable years ending 

after such date. 

SEC. 202. CREDITS FOR BIODIESEL AND RENEWABLE DIESEL. 

(a) IN GENERAL.—Sections 40A(g), 6426(c)(6), 

and 6427(e)(5)(B) are each amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. 

(b) INCREASE IN RATE OF CREDIT.— 

(1) INCOME TAX CREDIT.—Paragraphs (1)(A) 

and (2)(A) of section 40A(b) are each amended 

by striking ‘‘50 cents’’ and inserting ‘‘$1.00’’. 

(2) EXCISE TAX CREDIT.—Paragraph (2) of 

section 6426(c) is amended to read as follows: 

‘‘(2) APPLICABLE AMOUNT.—For purposes of 

this subsection, the applicable amount is 

$1.00.’’. 

(3) CONFORMING AMENDMENTS.— 

(A) Subsection (b) of section 40A is amended by striking paragraph (3) and by redesignating paragraphs (4) and (5) as paragraphs 

(3) and (4), respectively. 

(B) Paragraph (2) of section 40A(f) is 

amended to read as follows: 

‘‘(2) EXCEPTION.—Subsection (b)(4) shall 

not apply with respect to renewable diesel.’’. 

(C) Paragraphs (2) and (3) of section 40A(e) 

are each amended by striking ‘‘subsection 

(b)(5)(C)’’ and inserting ‘‘subsection 

(b)(4)(C)’’. 

(D) Clause (ii) of section 40A(d)(3)(C) is 

amended by striking ‘‘subsection (b)(5)(B)’’ 

and inserting ‘‘subsection (b)(4)(B)’’. 

(c) UNIFORM TREATMENT OF DIESEL PRODUCED FROM BIOMASS.—Paragraph (3) of section 40A(f) is amended— 

(1) by striking ‘‘diesel fuel’’ and inserting 

‘‘liquid fuel’’, 

(2) by striking ‘‘using a thermal 

depolymerization process’’, and 

(3) by inserting ‘‘, or other equivalent 

standard approved by the Secretary’’ after 

‘‘D396’’. 

(d) COPRODUCTION OF RENEWABLE DIESEL

WITH PETROLEUM FEEDSTOCK.— 

(1) IN GENERAL.—Paragraph (3) of section 

40A(f) is amended by adding at the end the 

following new sentences: ‘‘Such term does 

not include any fuel derived from coprocessing biomass with a feedstock which is not 

biomass. For purposes of this paragraph, the 

term ‘biomass’ has the meaning given such 

term by section 45K(c)(3).’’. 

(2) CONFORMING AMENDMENT.—Paragraph 

(3) of section 40A(f) is amended by striking 

‘‘(as defined in section 45K(c)(3))’’. 

(e) ELIGIBILITY OF CERTAIN AVIATION

FUEL.—Subsection (f) of section 40A (relating 

to renewable diesel) is amended by adding at 

the end the following new paragraph: 

‘‘(4) CERTAIN AVIATION FUEL.— 

‘‘(A) IN GENERAL.—Except as provided in 

the last 3 sentences of paragraph (3), the 

term ‘renewable diesel’ shall include fuel derived from biomass which meets the requirements of a Department of Defense specification for military jet fuel or an American Society of Testing and Materials specification 

for aviation turbine fuel. 

‘‘(B) APPLICATION OF MIXTURE CREDITS.—In 

the case of fuel which is treated as renewable 

diesel solely by reason of subparagraph (A), 

subsection (b)(1) and section 6426(c) shall be 

applied with respect to such fuel by treating 

kerosene as though it were diesel fuel.’’. 

(f) MODIFICATION RELATING TO DEFINITION

OF AGRI-BIODIESEL.—Paragraph (2) of section 

40A(d) (relating to agri-biodiesel) is amended 

by striking ‘‘and mustard seeds’’ and inserting ‘‘mustard seeds, and camelina’’. 

(g) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall apply to fuel produced, and sold or used, after December 31, 

2008. 

(2) COPRODUCTION OF RENEWABLE DIESEL

WITH PETROLEUM FEEDSTOCK.—The amendment made by subsection (d) shall apply to 

fuel produced, and sold or used, after the 

date of the enactment of this Act. 

SEC. 203. CLARIFICATION THAT CREDITS FOR 

FUEL ARE DESIGNED TO PROVIDE 

AN INCENTIVE FOR UNITED STATES 

PRODUCTION. 

(a) ALCOHOL FUELS CREDIT.—Subsection (d) 

of section 40 is amended by adding at the end 

the following new paragraph: 

‘‘(7) LIMITATION TO ALCOHOL WITH CONNECTION TO THE UNITED STATES.—No credit shall 

be determined under this section with respect to any alcohol which is produced outside the United States for use as a fuel outside the United States. For purposes of this 

paragraph, the term ‘United States’ includes 

any possession of the United States.’’. 

(b) BIODIESEL FUELS CREDIT.—Subsection 

(d) of section 40A is amended by adding at 

the end the following new paragraph: 

‘‘(5) LIMITATION TO BIODIESEL WITH CONNECTION TO THE UNITED STATES.—No credit shall 

be determined under this section with respect to any biodiesel which is produced outside the United States for use as a fuel outside the United States. For purposes of this 

paragraph, the term ‘United States’ includes 

any possession of the United States.’’. 

(c) EXCISE TAX CREDIT.— 

(1) IN GENERAL.—Section 6426 is amended 

by adding at the end the following new subsection: 

‘‘(i) LIMITATION TO FUELS WITH CONNECTION

TO THE UNITED STATES.— 

‘‘(1) ALCOHOL.—No credit shall be determined under this section with respect to any 

alcohol which is produced outside the United 

States for use as a fuel outside the United 

States. 

‘‘(2) BIODIESEL AND ALTERNATIVE FUELS.— 

No credit shall be determined under this section with respect to any biodiesel or alternative fuel which is produced outside the 

United States for use as a fuel outside the 

United States. 

For purposes of this subsection, the term 

‘United States’ includes any possession of 

the United States.’’. 

(2) CONFORMING AMENDMENT.—Subsection 

(e) of section 6427 is amended by redesignating paragraph (5) as paragraph (6) and by 

inserting after paragraph (4) the following 

new paragraph: 

‘‘(5) LIMITATION TO FUELS WITH CONNECTION

TO THE UNITED STATES.—No amount shall be 

payable under paragraph (1) or (2) with respect to any mixture or alternative fuel if 

credit is not allowed with respect to such 

mixture or alternative fuel by reason of section 6426(i).’’. 

(d) EFFECTIVE DATE.—The amendments 

made by this section shall apply to claims 

for credit or payment made on or after May 

15, 2008. 

SEC. 204. EXTENSION AND MODIFICATION OF ALTERNATIVE FUEL CREDIT. 

(a) EXTENSION.— 

(1) ALTERNATIVE FUEL CREDIT.—Paragraph 

(4) of section 6426(d) (relating to alternative 

fuel credit) is amended by striking ‘‘September 30, 2009’’ and inserting ‘‘December 31, 

2009’’. 

(2) ALTERNATIVE FUEL MIXTURE CREDIT.— 

Paragraph (3) of section 6426(e) (relating to 

alternative fuel mixture credit) is amended 

by striking ‘‘September 30, 2009’’ and inserting ‘‘December 31, 2009’’. 

(3) PAYMENTS.—Subparagraph (C) of section 6427(e)(5) (relating to termination) is 

amended by striking ‘‘September 30, 2009’’ 

and inserting ‘‘December 31, 2009’’. 

(b) MODIFICATIONS.— 

(1) ALTERNATIVE FUEL TO INCLUDE COMPRESSED OR LIQUIFIED BIOMASS GAS.—Paragraph (2) of section 6426(d) (relating to alternative fuel credit) is amended by striking 

‘‘and’’ at the end of subparagraph (E), by redesignating subparagraph (F) as subparagraph (G), and by inserting after subparagraph (E) the following new subparagraph: 

‘‘(F) compressed or liquefied gas derived 

from biomass (as defined in section 

45K(c)(3)), and’’. 

(2) CREDIT ALLOWED FOR AVIATION USE OF

FUEL.—Paragraph (1) of section 6426(d) is 

amended by inserting ‘‘sold by the taxpayer 

for use as a fuel in aviation,’’ after ‘‘motorboat,’’. 

(c) CARBON CAPTURE REQUIREMENT FOR

CERTAIN FUELS.— 

(1) IN GENERAL.—Subsection (d) of section 

6426, as amended by subsection (a), is amended by redesignating paragraph (4) as paragraph (5) and by inserting after paragraph (3) 

the following new paragraph: 

‘‘(4) CARBON CAPTURE REQUIREMENT.— 

‘‘(A) IN GENERAL.—The requirements of 

this paragraph are met if the fuel is certified, under such procedures as required by 

the Secretary, as having been derived from 

coal produced at a gasification facility which 

separates and sequesters not less than the 

applicable percentage of such facility’s total 

carbon dioxide emissions. 

‘‘(B) APPLICABLE PERCENTAGE.—For purposes of subparagraph (A), the applicable 

percentage is— 


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S10360 CONGRESSIONAL RECORD — SENATE October 1, 2008 

‘‘(i) 50 percent in the case of fuel produced 

after September 30, 2009, and on or before December 30, 2009, and 

‘‘(ii) 75 percent in the case of fuel produced 

after December 30, 2009.’’. 

(2) CONFORMING AMENDMENT.—Subparagraph (E) of section 6426(d)(2) is amended by 

inserting ‘‘which meets the requirements of 

paragraph (4) and which is’’ after ‘‘any liquid 

fuel’’. 

(d) EFFECTIVE DATE.—The amendments 

made by this section shall apply to fuel sold 

or used after the date of the enactment of 

this Act. 

SEC. 205. CREDIT FOR NEW QUALIFIED PLUG-IN 

ELECTRIC DRIVE MOTOR VEHICLES. 

(a) PLUG-IN ELECTRIC DRIVE MOTOR VEHICLE CREDIT.—Subpart B of part IV of subchapter A of chapter 1 (relating to other 

credits) is amended by adding at the end the 

following new section: 

‘‘SEC. 30D. NEW QUALIFIED PLUG-IN ELECTRIC 

DRIVE MOTOR VEHICLES. 

‘‘(a) ALLOWANCE OF CREDIT.— 

‘‘(1) IN GENERAL.—There shall be allowed as 

a credit against the tax imposed by this 

chapter for the taxable year an amount 

equal to the applicable amount with respect 

to each new qualified plug-in electric drive 

motor vehicle placed in service by the taxpayer during the taxable year. 

‘‘(2) APPLICABLE AMOUNT.—For purposes of 

paragraph (1), the applicable amount is sum 

of— 

‘‘(A) $2,500, plus 

‘‘(B) $417 for each kilowatt hour of traction 

battery capacity in excess of 4 kilowatt 

hours. 

‘‘(b) LIMITATIONS.— 

‘‘(1) LIMITATION BASED ON WEIGHT.—The 

amount of the credit allowed under subsection (a) by reason of subsection (a)(2) 

shall not exceed— 

‘‘(A) $7,500, in the case of any new qualified 

plug-in electric drive motor vehicle with a 

gross vehicle weight rating of not more than 

10,000 pounds, 

‘‘(B) $10,000, in the case of any new qualified plug-in electric drive motor vehicle with 

a gross vehicle weight rating of more than 

10,000 pounds but not more than 14,000 

pounds, 

‘‘(C) $12,500, in the case of any new qualified plug-in electric drive motor vehicle with 

a gross vehicle weight rating of more than 

14,000 pounds but not more than 26,000 

pounds, and 

‘‘(D) $15,000, in the case of any new qualified plug-in electric drive motor vehicle with 

a gross vehicle weight rating of more than 

26,000 pounds. 

‘‘(2) LIMITATION ON NUMBER OF PASSENGER

VEHICLES AND LIGHT TRUCKS ELIGIBLE FOR

CREDIT.— 

‘‘(A) IN GENERAL.—In the case of a new 

qualified plug-in electric drive motor vehicle 

sold during the phaseout period, only the applicable percentage of the credit otherwise 

allowable under subsection (a) shall be allowed. 

‘‘(B) PHASEOUT PERIOD.—For purposes of 

this subsection, the phaseout period is the 

period beginning with the second calendar 

quarter following the calendar quarter which 

includes the first date on which the total 

number of such new qualified plug-in electric 

drive motor vehicles sold for use in the 

United States after December 31, 2008, is at 

least 250,000. 

‘‘(C) APPLICABLE PERCENTAGE.—For purposes of subparagraph (A), the applicable 

percentage is— 

‘‘(i) 50 percent for the first 2 calendar quarters of the phaseout period, 

‘‘(ii) 25 percent for the 3d and 4th calendar 

quarters of the phaseout period, and 

‘‘(iii) 0 percent for each calendar quarter 

thereafter. 

‘‘(D) CONTROLLED GROUPS.—Rules similar 

to the rules of section 30B(f)(4) shall apply 

for purposes of this subsection. 

‘‘(c) NEW QUALIFIED PLUG-IN ELECTRIC

DRIVE MOTOR VEHICLE.—For purposes of this 

section, the term ‘new qualified plug-in electric drive motor vehicle’ means a motor vehicle— 

‘‘(1) which draws propulsion using a traction battery with at least 4 kilowatt hours of 

capacity, 

‘‘(2) which uses an offboard source of energy to recharge such battery, 

‘‘(3) which, in the case of a passenger vehicle or light truck which has a gross vehicle 

weight rating of not more than 8,500 pounds, 

has received a certificate of conformity 

under the Clean Air Act and meets or exceeds the equivalent qualifying California 

low emission vehicle standard under section 

243(e)(2) of the Clean Air Act for that make 

and model year, and 

‘‘(A) in the case of a vehicle having a gross 

vehicle weight rating of 6,000 pounds or less, 

the Bin 5 Tier II emission standard established in regulations prescribed by the Administrator of the Environmental Protection 

Agency under section 202(i) of the Clean Air 

Act for that make and model year vehicle, 

and 

‘‘(B) in the case of a vehicle having a gross 

vehicle weight rating of more than 6,000 

pounds but not more than 8,500 pounds, the 

Bin 8 Tier II emission standard which is so 

established, 

‘‘(4) the original use of which commences 

with the taxpayer, 

‘‘(5) which is acquired for use or lease by 

the taxpayer and not for resale, and 

‘‘(6) which is made by a manufacturer. 

‘‘(d) APPLICATION WITH OTHER CREDITS.— 

‘‘(1) BUSINESS CREDIT TREATED AS PART OF

GENERAL BUSINESS CREDIT.—So much of the 

credit which would be allowed under subsection (a) for any taxable year (determined 

without regard to this subsection) that is attributable to property of a character subject 

to an allowance for depreciation shall be 

treated as a credit listed in section 38(b) for 

such taxable year (and not allowed under 

subsection (a)). 

‘‘(2) PERSONAL CREDIT.— 

‘‘(A) IN GENERAL.—For purposes of this 

title, the credit allowed under subsection (a) 

for any taxable year (determined after application of paragraph (1)) shall be treated as a 

credit allowable under subpart A for such 

taxable year. 

‘‘(B) LIMITATION BASED ON AMOUNT OF

TAX.—In the case of a taxable year to which 

section 26(a)(2) does not apply, the credit allowed under subsection (a) for any taxable 

year (determined after application of paragraph (1)) shall not exceed the excess of— 

‘‘(i) the sum of the regular tax liability (as 

defined in section 26(b)) plus the tax imposed 

by section 55, over 

‘‘(ii) the sum of the credits allowable under 

subpart A (other than this section and sections 23 and 25D) and section 27 for the taxable year. 

‘‘(e) OTHER DEFINITIONS AND SPECIAL

RULES.—For purposes of this section— 

‘‘(1) MOTOR VEHICLE.—The term ‘motor vehicle’ has the meaning given such term by 

section 30(c)(2). 

‘‘(2) OTHER TERMS.—The terms ‘passenger 

automobile’, ‘light truck’, and ‘manufacturer’ have the meanings given such terms in 

regulations prescribed by the Administrator 

of the Environmental Protection Agency for 

purposes of the administration of title II of 

the Clean Air Act (42 U.S.C. 7521 et seq.). 

‘‘(3) TRACTION BATTERY CAPACITY.—Traction battery capacity shall be measured in 

kilowatt hours from a 100 percent state of 

charge to a zero percent state of charge. 

‘‘(4) REDUCTION IN BASIS.—For purposes of 

this subtitle, the basis of any property for 

which a credit is allowable under subsection 

(a) shall be reduced by the amount of such 

credit so allowed. 

‘‘(5) NO DOUBLE BENEFIT.—The amount of 

any deduction or other credit allowable 

under this chapter for a new qualified plugin electric drive motor vehicle shall be reduced by the amount of credit allowed under 

subsection (a) for such vehicle for the taxable year. 

‘‘(6) PROPERTY USED BY TAX-EXEMPT ENTITY.—In the case of a vehicle the use of which 

is described in paragraph (3) or (4) of section 

50(b) and which is not subject to a lease, the 

person who sold such vehicle to the person or 

entity using such vehicle shall be treated as 

the taxpayer that placed such vehicle in 

service, but only if such person clearly discloses to such person or entity in a document the amount of any credit allowable 

under subsection (a) with respect to such vehicle (determined without regard to subsection (b)(2)). 

‘‘(7) PROPERTY USED OUTSIDE UNITED

STATES, ETC., NOT QUALIFIED.—No credit shall 

be allowable under subsection (a) with respect to any property referred to in section 

50(b)(1) or with respect to the portion of the 

cost of any property taken into account 

under section 179. 

‘‘(8) RECAPTURE.—The Secretary shall, by 

regulations, provide for recapturing the benefit of any credit allowable under subsection 

(a) with respect to any property which ceases 

to be property eligible for such credit (including recapture in the case of a lease period of less than the economic life of a vehicle). 

‘‘(9) ELECTION TO NOT TAKE CREDIT.—No 

credit shall be allowed under subsection (a) 

for any vehicle if the taxpayer elects not to 

have this section apply to such vehicle. 

‘‘(10) INTERACTION WITH AIR QUALITY AND

MOTOR VEHICLE SAFETY STANDARDS.—Unless 

otherwise provided in this section, a motor 

vehicle shall not be considered eligible for a 

credit under this section unless such vehicle 

is in compliance with— 

‘‘(A) the applicable provisions of the Clean 

Air Act for the applicable make and model 

year of the vehicle (or applicable air quality 

provisions of State law in the case of a State 

which has adopted such provision under a 

waiver under section 209(b) of the Clean Air 

Act), and 

‘‘(B) the motor vehicle safety provisions of 

sections 30101 through 30169 of title 49, 

United States Code. 

‘‘(f) REGULATIONS.— 

‘‘(1) IN GENERAL.—Except as provided in 

paragraph (2), the Secretary shall promulgate such regulations as necessary to carry 

out the provisions of this section. 

‘‘(2) COORDINATION IN PRESCRIPTION OF CERTAIN REGULATIONS.—The Secretary of the 

Treasury, in coordination with the Secretary 

of Transportation and the Administrator of 

the Environmental Protection Agency, shall 

prescribe such regulations as necessary to 

determine whether a motor vehicle meets 

the requirements to be eligible for a credit 

under this section. 

‘‘(g) TERMINATION.—This section shall not 

apply to property purchased after December 

31, 2014.’’. 

(b) COORDINATION WITH ALTERNATIVE

MOTOR VEHICLE CREDIT.—Section 30B(d)(3) is 

amended by adding at the end the following 

new subparagraph: 

‘‘(D) EXCLUSION OF PLUG-IN VEHICLES.—Any 

vehicle with respect to which a credit is allowable under section 30D (determined without regard to subsection (d) thereof) shall 

not be taken into account under this section.’’. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10361 

(c) CREDIT MADE PART OF GENERAL BUSINESS CREDIT.—Section 38(b), as amended by 

this Act, is amended by striking ‘‘plus’’ at 

the end of paragraph (33), by striking the period at the end of paragraph (34) and inserting ‘‘plus’’, and by adding at the end the following new paragraph: 

‘‘(35) the portion of the new qualified plugin electric drive motor vehicle credit to 

which section 30D(d)(1) applies.’’. 

(d) CONFORMING AMENDMENTS.— 

(1)(A) Section 24(b)(3)(B), as amended by 

section 106, is amended by striking ‘‘and 

25D’’ and inserting ‘‘25D, and 30D’’. 

(B) Section 25(e)(1)(C)(ii) is amended by inserting ‘‘30D,’’ after ‘‘25D,’’. 

(C) Section 25B(g)(2), as amended by section 106, is amended by striking ‘‘and 25D’’ 

and inserting ‘‘, 25D, and 30D’’. 

(D) Section 26(a)(1), as amended by section 

106, is amended by striking ‘‘and 25D’’ and inserting ‘‘25D, and 30D’’. 

(E) Section 1400C(d)(2) is amended by striking ‘‘and 25D’’ and inserting ‘‘25D, and 30D’’. 

(2) Section 1016(a) is amended by striking 

‘‘and’’ at the end of paragraph (35), by striking the period at the end of paragraph (36) 

and inserting ‘‘, and’’, and by adding at the 

end the following new paragraph: 

‘‘(37) to the extent provided in section 

30D(e)(4).’’. 

(3) Section 6501(m) is amended by inserting 

‘‘30D(e)(9),’’ after ‘‘30C(e)(5),’’. 

(4) The table of sections for subpart B of 

part IV of subchapter A of chapter 1 is 

amended by adding at the end the following 

new item: 

‘‘Sec. 30D. New qualified plug-in electric 

drive motor vehicles.’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2008. 

(f) APPLICATION OF EGTRRA SUNSET.—The 

amendment made by subsection (d)(1)(A) 

shall be subject to title IX of the Economic 

Growth and Tax Relief Reconciliation Act of 

2001 in the same manner as the provision of 

such Act to which such amendment relates. 

SEC. 206. EXCLUSION FROM HEAVY TRUCK TAX 

FOR IDLING REDUCTION UNITS AND 

ADVANCED INSULATION. 

(a) IN GENERAL.—Section 4053 is amended 

by adding at the end the following new paragraphs: 

‘‘(9) IDLING REDUCTION DEVICE.—Any device 

or system of devices which— 

‘‘(A) is designed to provide to a vehicle 

those services (such as heat, air conditioning, or electricity) that would otherwise 

require the operation of the main drive engine while the vehicle is temporarily parked 

or remains stationary using one or more devices affixed to a tractor, and 

‘‘(B) is determined by the Administrator of 

the Environmental Protection Agency, in 

consultation with the Secretary of Energy 

and the Secretary of Transportation, to reduce idling of such vehicle at a motor vehicle rest stop or other location where such vehicles are temporarily parked or remain stationary. 

‘‘(10) ADVANCED INSULATION.—Any insulation that has an R value of not less than R35 

per inch.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to sales or 

installations after the date of the enactment 

of this Act. 

SEC. 207. ALTERNATIVE FUEL VEHICLE REFUELING PROPERTY CREDIT. 

(a) EXTENSION OF CREDIT.—Paragraph (2) of 

section 30C(g) is amended by striking ‘‘December 31, 2009’’ and inserting ‘‘December 31, 

2010’’. 

(b) INCLUSION OF ELECTRICITY AS A CLEANBURNING FUEL.—Section 30C(c)(2) is amended 

by adding at the end the following new subparagraph: 

‘‘(C) Electricity.’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to property 

placed in service after the date of the enactment of this Act, in taxable years ending 

after such date. 

SEC. 208. CERTAIN INCOME AND GAINS RELATING TO ALCOHOL FUELS AND MIXTURES, BIODIESEL FUELS AND MIXTURES, AND ALTERNATIVE FUELS 

AND MIXTURES TREATED AS QUALIFYING INCOME FOR PUBLICLY 

TRADED PARTNERSHIPS. 

(a) IN GENERAL.—Subparagraph (E) of section 7704(d)(1), as amended by this Act, is 

amended by striking ‘‘or industrial source 

carbon dioxide’’ and inserting ‘‘, industrial 

source carbon dioxide, or the transportation 

or storage of any fuel described in subsection 

(b), (c), (d), or (e) of section 6426, or any alcohol fuel defined in section 6426(b)(4)(A) or 

any biodiesel fuel as defined in section 

40A(d)(1)’’ after ‘‘timber)’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall take effect on the 

date of the enactment of this Act, in taxable 

years ending after such date. 

SEC. 209. EXTENSION AND MODIFICATION OF 

ELECTION TO EXPENSE CERTAIN REFINERIES. 

(a) EXTENSION.—Paragraph (1) of section 

179C(c) (relating to qualified refinery property) is amended— 

(1) by striking ‘‘January 1, 2012’’ in subparagraph (B) and inserting ‘‘January 1, 

2014’’, and 

(2) by striking ‘‘January 1, 2008’’ each place 

it appears in subparagraph (F) and inserting 

‘‘January 1, 2010’’. 

(b) INCLUSION OF FUEL DERIVED FROM

SHALE AND TAR SANDS.— 

(1) IN GENERAL.—Subsection (d) of section 

179C is amended by inserting ‘‘, or directly 

from shale or tar sands’’ after ‘‘(as defined in 

section 45K(c))’’. 

(2) CONFORMING AMENDMENT.—Paragraph 

(2) of section 179C(e) is amended by inserting 

‘‘shale, tar sands, or’’ before ‘‘qualified 

fuels’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to property 

placed in service after the date of the enactment of this Act. 

SEC. 210. EXTENSION OF SUSPENSION OF TAXABLE INCOME LIMIT ON PERCENTAGE DEPLETION FOR OIL AND NATURAL GAS PRODUCED FROM MARGINAL PROPERTIES. 

Subparagraph (H) of section 613A(c)(6) (relating to oil and gas produced from marginal 

properties) is amended by striking ‘‘for any 

taxable year’’ and all that follows and inserting ‘‘for any taxable year— 

‘‘(i) beginning after December 31, 1997, and 

before January 1, 2008, or 

‘‘(ii) beginning after December 31, 2008, and 

before January 1, 2010.’’. 

SEC. 211. TRANSPORTATION FRINGE BENEFIT TO 

BICYCLE COMMUTERS. 

(a) IN GENERAL.—Paragraph (1) of section 

132(f) is amended by adding at the end the 

following: 

‘‘(D) Any qualified bicycle commuting reimbursement.’’. 

(b) LIMITATION ON EXCLUSION.—Paragraph 

(2) of section 132(f) is amended by striking 

‘‘and’’ at the end of subparagraph (A), by 

striking the period at the end of subparagraph (B) and inserting ‘‘, and’’, and by adding at the end the following new subparagraph: 

‘‘(C) the applicable annual limitation in 

the case of any qualified bicycle commuting 

reimbursement.’’. 

(c) DEFINITIONS.—Paragraph (5) of section 

132(f) is amended by adding at the end the 

following: 

‘‘(F) DEFINITIONS RELATED TO BICYCLE COMMUTING REIMBURSEMENT.— 

‘‘(i) QUALIFIED BICYCLE COMMUTING REIMBURSEMENT.—The term ‘qualified bicycle 

commuting reimbursement’ means, with respect to any calendar year, any employer reimbursement during the 15-month period beginning with the first day of such calendar 

year for reasonable expenses incurred by the 

employee during such calendar year for the 

purchase of a bicycle and bicycle improvements, repair, and storage, if such bicycle is 

regularly used for travel between the employee’s residence and place of employment. 

‘‘(ii) APPLICABLE ANNUAL LIMITATION.—The 

term ‘applicable annual limitation’ means, 

with respect to any employee for any calendar year, the product of $20 multiplied by 

the number of qualified bicycle commuting 

months during such year. 

‘‘(iii) QUALIFIED BICYCLE COMMUTING

MONTH.—The term ‘qualified bicycle commuting month’ means, with respect to any 

employee, any month during which such employee— 

‘‘(I) regularly uses the bicycle for a substantial portion of the travel between the 

employee’s residence and place of employment, and 

‘‘(II) does not receive any benefit described 

in subparagraph (A), (B), or (C) of paragraph 

(1).’’. 

(d) CONSTRUCTIVE RECEIPT OF BENEFIT.— 

Paragraph (4) of section 132(f) is amended by 

inserting ‘‘(other than a qualified bicycle 

commuting reimbursement)’’ after ‘‘qualified transportation fringe’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2008. 

TITLE III—ENERGY CONSERVATION AND 

EFFICIENCY PROVISIONS 

SEC. 301. QUALIFIED ENERGY CONSERVATION 

BONDS. 

(a) IN GENERAL.—Subpart I of part IV of 

subchapter A of chapter 1, as amended by 

section 107, is amended by adding at the end 

the following new section: 

‘‘SEC. 54D. QUALIFIED ENERGY CONSERVATION 

BONDS. 

‘‘(a) QUALIFIED ENERGY CONSERVATION

BOND.—For purposes of this subchapter, the 

term ‘qualified energy conservation bond’ 

means any bond issued as part of an issue 

if— 

‘‘(1) 100 percent of the available project 

proceeds of such issue are to be used for one 

or more qualified conservation purposes, 

‘‘(2) the bond is issued by a State or local 

government, and 

‘‘(3) the issuer designates such bond for 

purposes of this section. 

‘‘(b) REDUCED CREDIT AMOUNT.—The annual 

credit determined under section 54A(b) with 

respect to any qualified energy conservation 

bond shall be 70 percent of the amount so determined without regard to this subsection. 

‘‘(c) LIMITATION ON AMOUNT OF BONDS DESIGNATED.—The maximum aggregate face 

amount of bonds which may be designated 

under subsection (a) by any issuer shall not 

exceed the limitation amount allocated to 

such issuer under subsection (e). 

‘‘(d) NATIONAL LIMITATION ON AMOUNT OF

BONDS DESIGNATED.—There is a national 

qualified energy conservation bond limitation of $800,000,000. 

‘‘(e) ALLOCATIONS.— 

‘‘(1) IN GENERAL.—The limitation applicable under subsection (d) shall be allocated by 

the Secretary among the States in proportion to the population of the States. 

‘‘(2) ALLOCATIONS TO LARGEST LOCAL GOVERNMENTS.— 

‘‘(A) IN GENERAL.—In the case of any State 

in which there is a large local government, 

each such local government shall be allocated a portion of such State’s allocation 

which bears the same ratio to the State’s allocation (determined without regard to this 


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S10362 CONGRESSIONAL RECORD — SENATE October 1, 2008 

subparagraph) as the population of such 

large local government bears to the population of such State. 

‘‘(B) ALLOCATION OF UNUSED LIMITATION TO

STATE.—The amount allocated under this 

subsection to a large local government may 

be reallocated by such local government to 

the State in which such local government is 

located. 

‘‘(C) LARGE LOCAL GOVERNMENT.—For purposes of this section, the term ‘large local 

government’ means any municipality or 

county if such municipality or county has a 

population of 100,000 or more. 

‘‘(3) ALLOCATION TO ISSUERS; RESTRICTION

ON PRIVATE ACTIVITY BONDS.—Any allocation 

under this subsection to a State or large 

local government shall be allocated by such 

State or large local government to issuers 

within the State in a manner that results in 

not less than 70 percent of the allocation to 

such State or large local government being 

used to designate bonds which are not private activity bonds. 

‘‘(f) QUALIFIED CONSERVATION PURPOSE.— 

For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘qualified conservation purpose’ means any of the following: 

‘‘(A) Capital expenditures incurred for purposes of— 

‘‘(i) reducing energy consumption in publicly-owned buildings by at least 20 percent, 

‘‘(ii) implementing green community programs, 

‘‘(iii) rural development involving the production of electricity from renewable energy 

resources, or 

‘‘(iv) any qualified facility (as determined 

under section 45(d) without regard to paragraphs (8) and (10) thereof and without regard to any placed in service date). 

‘‘(B) Expenditures with respect to research 

facilities, and research grants, to support research in— 

‘‘(i) development of cellulosic ethanol or 

other nonfossil fuels, 

‘‘(ii) technologies for the capture and sequestration of carbon dioxide produced 

through the use of fossil fuels, 

‘‘(iii) increasing the efficiency of existing 

technologies for producing nonfossil fuels, 

‘‘(iv) automobile battery technologies and 

other technologies to reduce fossil fuel consumption in transportation, or 

‘‘(v) technologies to reduce energy use in 

buildings. 

‘‘(C) Mass commuting facilities and related 

facilities that reduce the consumption of energy, including expenditures to reduce pollution from vehicles used for mass commuting. 

‘‘(D) Demonstration projects designed to 

promote the commercialization of— 

‘‘(i) green building technology, 

‘‘(ii) conversion of agricultural waste for 

use in the production of fuel or otherwise, 

‘‘(iii) advanced battery manufacturing 

technologies, 

‘‘(iv) technologies to reduce peak use of 

electricity, or 

‘‘(v) technologies for the capture and sequestration of carbon dioxide emitted from 

combusting fossil fuels in order to produce 

electricity. 

‘‘(E) Public education campaigns to promote energy efficiency. 

‘‘(2) SPECIAL RULES FOR PRIVATE ACTIVITY

BONDS.—For purposes of this section, in the 

case of any private activity bond, the term 

‘qualified conservation purposes’ shall not 

include any expenditure which is not a capital expenditure. 

‘‘(g) POPULATION.— 

‘‘(1) IN GENERAL.—The population of any 

State or local government shall be determined for purposes of this section as provided in section 146(j) for the calendar year 

which includes the date of the enactment of 

this section. 

‘‘(2) SPECIAL RULE FOR COUNTIES.—In determining the population of any county for purposes of this section, any population of such 

county which is taken into account in determining the population of any municipality 

which is a large local government shall not 

be taken into account in determining the 

population of such county. 

‘‘(h) APPLICATION TO INDIAN TRIBAL GOVERNMENTS.—An Indian tribal government 

shall be treated for purposes of this section 

in the same manner as a large local government, except that— 

‘‘(1) an Indian tribal government shall be 

treated for purposes of subsection (e) as located within a State to the extent of so 

much of the population of such government 

as resides within such State, and 

‘‘(2) any bond issued by an Indian tribal 

government shall be treated as a qualified 

energy conservation bond only if issued as 

part of an issue the available project proceeds of which are used for purposes for 

which such Indian tribal government could 

issue bonds to which section 103(a) applies.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Paragraph (1) of section 54A(d), as 

amended by this Act, is amended to read as 

follows: 

‘‘(1) QUALIFIED TAX CREDIT BOND.—The term 

‘qualified tax credit bond’ means— 

‘‘(A) a qualified forestry conservation 

bond, 

‘‘(B) a new clean renewable energy bond, or 

‘‘(C) a qualified energy conservation bond, 

which is part of an issue that meets requirements of paragraphs (2), (3), (4), (5), and (6).’’. 

(2) Subparagraph (C) of section 54A(d)(2), as 

amended by this Act, is amended to read as 

follows: 

‘‘(C) QUALIFIED PURPOSE.—For purposes of 

this paragraph, the term ‘qualified purpose’ 

means— 

‘‘(i) in the case of a qualified forestry conservation bond, a purpose specified in section 

54B(e), 

‘‘(ii) in the case of a new clean renewable 

energy bond, a purpose specified in section 

54C(a)(1), and 

‘‘(iii) in the case of a qualified energy conservation bond, a purpose specified in section 

54D(a)(1).’’. 

(3) The table of sections for subpart I of 

part IV of subchapter A of chapter 1, as 

amended by this Act, is amended by adding 

at the end the following new item: 

‘‘Sec. 54D. Qualified energy conservation 

bonds.’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to obligations issued after the date of the enactment 

of this Act. 

SEC. 302. CREDIT FOR NONBUSINESS ENERGY 

PROPERTY. 

(a) EXTENSION OF CREDIT.—Section 25C(g) is 

amended by striking ‘‘placed in service after 

December 31, 2007’’ and inserting ‘‘placed in 

service— 

‘‘(1) after December 31, 2007, and before 

January 1, 2009, or 

‘‘(2) after December 31, 2009.’’. 

(b) QUALIFIED BIOMASS FUEL PROPERTY.— 

(1) IN GENERAL.—Section 25C(d)(3) is 

amended— 

(A) by striking ‘‘and’’ at the end of subparagraph (D), 

(B) by striking the period at the end of 

subparagraph (E) and inserting ‘‘, and’’, and 

(C) by adding at the end the following new 

subparagraph: 

‘‘(F) a stove which uses the burning of biomass fuel to heat a dwelling unit located in 

the United States and used as a residence by 

the taxpayer, or to heat water for use in such 

a dwelling unit, and which has a thermal efficiency rating of at least 75 percent.’’. 

(2) BIOMASS FUEL.—Section 25C(d) is 

amended by adding at the end the following 

new paragraph: 

‘‘(6) BIOMASS FUEL.—The term ‘biomass 

fuel’ means any plant-derived fuel available 

on a renewable or recurring basis, including 

agricultural crops and trees, wood and wood 

waste and residues (including wood pellets), 

plants (including aquatic plants), grasses, 

residues, and fibers.’’. 

(c) MODIFICATION OF WATER HEATER REQUIREMENTS.—Section 25C(d)(3)(E) is amended by inserting ‘‘or a thermal efficiency of at 

least 90 percent’’ after ‘‘0.80’’. 

(d) COORDINATION WITH CREDIT FOR QUALIFIED GEOTHERMAL HEAT PUMP PROPERTY EXPENDITURES.— 

(1) IN GENERAL.—Paragraph (3) of section 

25C(d), as amended by subsections (b) and (c), 

is amended by striking subparagraph (C) and 

by redesignating subparagraphs (D), (E), and 

(F) as subparagraphs (C), (D), and (E), respectively. 

(2) CONFORMING AMENDMENT.—Subparagraph (C) of section 25C(d)(2) is amended to 

read as follows: 

‘‘(C) REQUIREMENTS AND STANDARDS FOR AIR

CONDITIONERS AND HEAT PUMPS.—The standards and requirements prescribed by the Secretary under subparagraph (B) with respect 

to the energy efficiency ratio (EER) for central air conditioners and electric heat 

pumps— 

‘‘(i) shall require measurements to be 

based on published data which is tested by 

manufacturers at 95 degrees Fahrenheit, and 

‘‘(ii) may be based on the certified data of 

the Air Conditioning and Refrigeration Institute that are prepared in partnership with 

the Consortium for Energy Efficiency.’’. 

(e) MODIFICATION OF QUALIFIED ENERGY EFFICIENCY IMPROVEMENTS.— 

(1) IN GENERAL.—Paragraph (1) of section 

25C(c) is amended by inserting ‘‘, or an asphalt roof with appropriate cooling granules,’’ before ‘‘which meet the Energy Star 

program requirements’’. 

(2) BUILDING ENVELOPE COMPONENT.—Subparagraph (D) of section 25C(c)(2) is amended— 

(A) by inserting ‘‘or asphalt roof’’ after 

‘‘metal roof’’, and 

(B) by inserting ‘‘or cooling granules’’ 

after ‘‘pigmented coatings’’. 

(f) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided in 

paragraph (2), the amendments made this 

section shall apply to expenditures made 

after December 31, 2008. 

(2) MODIFICATION OF QUALIFIED ENERGY EFFICIENCY IMPROVEMENTS.—The amendments 

made by subsection (e) shall apply to property placed in service after the date of the 

enactment of this Act. 

SEC. 303. ENERGY EFFICIENT COMMERCIAL 

BUILDINGS DEDUCTION. 

Subsection (h) of section 179D is amended 

by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2013’’. 

SEC. 304. NEW ENERGY EFFICIENT HOME CREDIT. 

Subsection (g) of section 45L (relating to 

termination) is amended by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 

2009’’. 

SEC. 305. MODIFICATIONS OF ENERGY EFFICIENT 

APPLIANCE CREDIT FOR APPLIANCES PRODUCED AFTER 2007. 

(a) IN GENERAL.—Subsection (b) of section 

45M is amended to read as follows: 

‘‘(b) APPLICABLE AMOUNT.—For purposes of 

subsection (a)— 

‘‘(1) DISHWASHERS.—The applicable amount 

is— 

‘‘(A) $45 in the case of a dishwasher which 

is manufactured in calendar year 2008 or 2009 

and which uses no more than 324 kilowatt 

hours per year and 5.8 gallons per cycle, and 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10363 

‘‘(B) $75 in the case of a dishwasher which 

is manufactured in calendar year 2008, 2009, 

or 2010 and which uses no more than 307 kilowatt hours per year and 5.0 gallons per cycle 

(5.5 gallons per cycle for dishwashers designed for greater than 12 place settings). 

‘‘(2) CLOTHES WASHERS.—The applicable 

amount is— 

‘‘(A) $75 in the case of a residential toploading clothes washer manufactured in calendar year 2008 which meets or exceeds a 1.72 

modified energy factor and does not exceed a 

8.0 water consumption factor, 

‘‘(B) $125 in the case of a residential toploading clothes washer manufactured in calendar year 2008 or 2009 which meets or exceeds a 1.8 modified energy factor and does 

not exceed a 7.5 water consumption factor, 

‘‘(C) $150 in the case of a residential or 

commercial clothes washer manufactured in 

calendar year 2008, 2009, or 2010 which meets 

or exceeds 2.0 modified energy factor and 

does not exceed a 6.0 water consumption factor, and 

‘‘(D) $250 in the case of a residential or 

commercial clothes washer manufactured in 

calendar year 2008, 2009, or 2010 which meets 

or exceeds 2.2 modified energy factor and 

does not exceed a 4.5 water consumption factor. 

‘‘(3) REFRIGERATORS.—The applicable 

amount is— 

‘‘(A) $50 in the case of a refrigerator which 

is manufactured in calendar year 2008, and 

consumes at least 20 percent but not more 

than 22.9 percent less kilowatt hours per 

year than the 2001 energy conservation 

standards, 

‘‘(B) $75 in the case of a refrigerator which 

is manufactured in calendar year 2008 or 2009, 

and consumes at least 23 percent but no 

more than 24.9 percent less kilowatt hours 

per year than the 2001 energy conservation 

standards, 

‘‘(C) $100 in the case of a refrigerator which 

is manufactured in calendar year 2008, 2009, 

or 2010, and consumes at least 25 percent but 

not more than 29.9 percent less kilowatt 

hours per year than the 2001 energy conservation standards, and 

‘‘(D) $200 in the case of a refrigerator manufactured in calendar year 2008, 2009, or 2010 

and which consumes at least 30 percent less 

energy than the 2001 energy conservation 

standards.’’. 

(b) ELIGIBLE PRODUCTION.— 

(1) SIMILAR TREATMENT FOR ALL APPLIANCES.—Subsection (c) of section 45M is 

amended— 

(A) by striking paragraph (2), 

(B) by striking ‘‘(1) IN GENERAL’’ and all 

that follows through ‘‘the eligible’’ and inserting ‘‘The eligible’’, 

(C) by moving the text of such subsection 

in line with the subsection heading, and 

(D) by redesignating subparagraphs (A) and 

(B) as paragraphs (1) and (2), respectively, 

and by moving such paragraphs 2 ems to the 

left. 

(2) MODIFICATION OF BASE PERIOD.—Paragraph (2) of section 45M(c), as amended by 

paragraph (1), is amended by striking ‘‘3-calendar year’’ and inserting ‘‘2-calendar year’’. 

(c) TYPES OF ENERGY EFFICIENT APPLIANCES.—Subsection (d) of section 45M is 

amended to read as follows: 

‘‘(d) TYPES OF ENERGY EFFICIENT APPLIANCE.—For purposes of this section, the 

types of energy efficient appliances are— 

‘‘(1) dishwashers described in subsection 

(b)(1), 

‘‘(2) clothes washers described in subsection (b)(2), and 

‘‘(3) refrigerators described in subsection 

(b)(3).’’. 

(d) AGGREGATE CREDIT AMOUNT ALLOWED.— 

(1) INCREASE IN LIMIT.—Paragraph (1) of 

section 45M(e) is amended to read as follows: 

‘‘(1) AGGREGATE CREDIT AMOUNT ALLOWED.— 

The aggregate amount of credit allowed 

under subsection (a) with respect to a taxpayer for any taxable year shall not exceed 

$75,000,000 reduced by the amount of the 

credit allowed under subsection (a) to the 

taxpayer (or any predecessor) for all prior 

taxable years beginning after December 31, 

2007.’’. 

(2) EXCEPTION FOR CERTAIN REFRIGERATOR

AND CLOTHES WASHERS.—Paragraph (2) of section 45M(e) is amended to read as follows: 

‘‘(2) AMOUNT ALLOWED FOR CERTAIN REFRIGERATORS AND CLOTHES WASHERS.—Refrigerators described in subsection (b)(3)(D) and 

clothes washers described in subsection 

(b)(2)(D) shall not be taken into account 

under paragraph (1).’’. 

(e) QUALIFIED ENERGY EFFICIENT APPLIANCES.— 

(1) IN GENERAL.—Paragraph (1) of section 

45M(f) is amended to read as follows: 

‘‘(1) QUALIFIED ENERGY EFFICIENT APPLIANCE.—The term ‘qualified energy efficient 

appliance’ means— 

‘‘(A) any dishwasher described in subsection (b)(1), 

‘‘(B) any clothes washer described in subsection (b)(2), and 

‘‘(C) any refrigerator described in subsection (b)(3).’’. 

(2) CLOTHES WASHER.—Section 45M(f)(3) is 

amended by inserting ‘‘commercial’’ before 

‘‘residential’’ the second place it appears. 

(3) TOP-LOADING CLOTHES WASHER.—Subsection (f) of section 45M is amended by redesignating paragraphs (4), (5), (6), and (7) as 

paragraphs (5), (6), (7), and (8), respectively, 

and by inserting after paragraph (3) the following new paragraph: 

‘‘(4) TOP-LOADING CLOTHES WASHER.—The 

term ‘top-loading clothes washer’ means a 

clothes washer which has the clothes container compartment access located on the 

top of the machine and which operates on a 

vertical axis.’’. 

(4) REPLACEMENT OF ENERGY FACTOR.—Section 45M(f)(6), as redesignated by paragraph 

(3), is amended to read as follows: 

‘‘(6) MODIFIED ENERGY FACTOR.—The term 

‘modified energy factor’ means the modified 

energy factor established by the Department 

of Energy for compliance with the Federal 

energy conservation standard.’’. 

(5) GALLONS PER CYCLE; WATER CONSUMPTION FACTOR.—Section 45M(f), as amended by 

paragraph (3), is amended by adding at the 

end the following: 

‘‘(9) GALLONS PER CYCLE.—The term ‘gallons per cycle’ means, with respect to a dishwasher, the amount of water, expressed in 

gallons, required to complete a normal cycle 

of a dishwasher. 

‘‘(10) WATER CONSUMPTION FACTOR.—The 

term ‘water consumption factor’ means, with 

respect to a clothes washer, the quotient of 

the total weighted per-cycle water consumption divided by the cubic foot (or liter) capacity of the clothes washer.’’. 

(f) EFFECTIVE DATE.—The amendments 

made by this section shall apply to appliances produced after December 31, 2007. 

SEC. 306. ACCELERATED RECOVERY PERIOD FOR 

DEPRECIATION OF SMART METERS 

AND SMART GRID SYSTEMS. 

(a) IN GENERAL.—Section 168(e)(3)(D) is 

amended by striking ‘‘and’’ at the end of 

clause (i), by striking the period at the end 

of clause (ii) and inserting a comma, and by 

inserting after clause (ii) the following new 

clauses: 

‘‘(iii) any qualified smart electric meter, 

and 

‘‘(iv) any qualified smart electric grid system.’’. 

(b) DEFINITIONS.—Section 168(i) is amended 

by inserting at the end the following new 

paragraph: 

‘‘(18) QUALIFIED SMART ELECTRIC METERS.— 

‘‘(A) IN GENERAL.—The term ‘qualified 

smart electric meter’ means any smart electric meter which— 

‘‘(i) is placed in service by a taxpayer who 

is a supplier of electric energy or a provider 

of electric energy services, and 

‘‘(ii) does not have a class life (determined 

without regard to subsection (e)) of less than 

10 years. 

‘‘(B) SMART ELECTRIC METER.—For purposes 

of subparagraph (A), the term ‘smart electric 

meter’ means any time-based meter and related communication equipment which is capable of being used by the taxpayer as part 

of a system that— 

‘‘(i) measures and records electricity usage 

data on a time-differentiated basis in at 

least 24 separate time segments per day, 

‘‘(ii) provides for the exchange of information between supplier or provider and the 

customer’s electric meter in support of timebased rates or other forms of demand response, 

‘‘(iii) provides data to such supplier or provider so that the supplier or provider can 

provide energy usage information to customers electronically, and 

‘‘(iv) provides net metering. 

‘‘(19) QUALIFIED SMART ELECTRIC GRID SYSTEMS.— 

‘‘(A) IN GENERAL.—The term ‘qualified 

smart electric grid system’ means any smart 

grid property which— 

‘‘(i) is used as part of a system for electric 

distribution grid communications, monitoring, and management placed in service by 

a taxpayer who is a supplier of electric energy or a provider of electric energy services, 

and 

‘‘(ii) does not have a class life (determined 

without regard to subsection (e)) of less than 

10 years. 

‘‘(B) SMART GRID PROPERTY.—For the purposes of subparagraph (A), the term ‘smart 

grid property’ means electronics and related 

equipment that is capable of— 

‘‘(i) sensing, collecting, and monitoring 

data of or from all portions of a utility’s 

electric distribution grid, 

‘‘(ii) providing real-time, two-way communications to monitor or manage such grid, 

and 

‘‘(iii) providing real time analysis of and 

event prediction based upon collected data 

that can be used to improve electric distribution system reliability, quality, and performance.’’. 

(c) CONTINUED APPLICATION OF 150 PERCENT

DECLINING BALANCE METHOD.—Paragraph (2) 

of section 168(b) is amended by striking ‘‘or’’ 

at the end of subparagraph (B), by redesignating subparagraph (C) as subparagraph (D), 

and by inserting after subparagraph (B) the 

following new subparagraph: 

‘‘(C) any property (other than property described in paragraph (3)) which is a qualified 

smart electric meter or qualified smart electric grid system, or’’. 

(d) EFFECTIVE DATE.—The amendments 

made by this section shall apply to property 

placed in service after the date of the enactment of this Act. 

SEC. 307. QUALIFIED GREEN BUILDING AND SUSTAINABLE DESIGN PROJECTS. 

(a) IN GENERAL.—Paragraph (8) of section 

142(l) is amended by striking ‘‘September 30, 

2009’’ and inserting ‘‘September 30, 2012’’. 

(b) TREATMENT OF CURRENT REFUNDING

BONDS.—Paragraph (9) of section 142(l) is 

amended by striking ‘‘October 1, 2009’’ and 

inserting ‘‘October 1, 2012’’. 

(c) ACCOUNTABILITY.—The second sentence 

of section 701(d) of the American Jobs Creation Act of 2004 is amended by striking 

‘‘issuance,’’ and inserting ‘‘issuance of the 

last issue with respect to such project,’’. 


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SEC. 308. SPECIAL DEPRECIATION ALLOWANCE 

FOR CERTAIN REUSE AND RECYCLING PROPERTY. 

(a) IN GENERAL.—Section 168 is amended by 

adding at the end the following new subsection: 

‘‘(m) SPECIAL ALLOWANCE FOR CERTAIN

REUSE AND RECYCLING PROPERTY.— 

‘‘(1) IN GENERAL.—In the case of any qualified reuse and recycling property— 

‘‘(A) the depreciation deduction provided 

by section 167(a) for the taxable year in 

which such property is placed in service shall 

include an allowance equal to 50 percent of 

the adjusted basis of the qualified reuse and 

recycling property, and 

‘‘(B) the adjusted basis of the qualified 

reuse and recycling property shall be reduced 

by the amount of such deduction before computing the amount otherwise allowable as a 

depreciation deduction under this chapter 

for such taxable year and any subsequent 

taxable year. 

‘‘(2) QUALIFIED REUSE AND RECYCLING PROPERTY.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘qualified 

reuse and recycling property’ means any 

reuse and recycling property— 

‘‘(i) to which this section applies, 

‘‘(ii) which has a useful life of at least 5 

years, 

‘‘(iii) the original use of which commences 

with the taxpayer after August 31, 2008, and 

‘‘(iv) which is— 

‘‘(I) acquired by purchase (as defined in 

section 179(d)(2)) by the taxpayer after August 31, 2008, but only if no written binding 

contract for the acquisition was in effect before September 1, 2008, or 

‘‘(II) acquired by the taxpayer pursuant to 

a written binding contract which was entered into after August 31, 2008. 

‘‘(B) EXCEPTIONS.— 

‘‘(i) BONUS DEPRECIATION PROPERTY UNDER

SUBSECTION (k).—The term ‘qualified reuse 

and recycling property’ shall not include any 

property to which section 168(k) applies. 

‘‘(ii) ALTERNATIVE DEPRECIATION PROPERTY.—The term ‘qualified reuse and recycling property’ shall not include any property to which the alternative depreciation 

system under subsection (g) applies, determined without regard to paragraph (7) of 

subsection (g) (relating to election to have 

system apply). 

‘‘(iii) ELECTION OUT.—If a taxpayer makes 

an election under this clause with respect to 

any class of property for any taxable year, 

this subsection shall not apply to all property in such class placed in service during 

such taxable year. 

‘‘(C) SPECIAL RULE FOR SELF-CONSTRUCTED

PROPERTY.—In the case of a taxpayer manufacturing, constructing, or producing property for the taxpayer’s own use, the requirements of clause (iv) of subparagraph (A) shall 

be treated as met if the taxpayer begins 

manufacturing, constructing, or producing 

the property after August 31, 2008. 

‘‘(D) DEDUCTION ALLOWED IN COMPUTING

MINIMUM TAX.—For purposes of determining 

alternative minimum taxable income under 

section 55, the deduction under subsection 

(a) for qualified reuse and recycling property 

shall be determined under this section without regard to any adjustment under section 

56. 

‘‘(3) DEFINITIONS.—For purposes of this subsection— 

‘‘(A) REUSE AND RECYCLING PROPERTY.— 

‘‘(i) IN GENERAL.—The term ‘reuse and recycling property’ means any machinery and 

equipment (not including buildings or real 

estate), along with all appurtenances thereto, including software necessary to operate 

such equipment, which is used exclusively to 

collect, distribute, or recycle qualified reuse 

and recyclable materials. 

‘‘(ii) EXCLUSION.—Such term does not include rolling stock or other equipment used 

to transport reuse and recyclable materials. 

‘‘(B) QUALIFIED REUSE AND RECYCLABLE MATERIALS.— 

‘‘(i) IN GENERAL.—The term ‘qualified reuse 

and recyclable materials’ means scrap plastic, scrap glass, scrap textiles, scrap rubber, 

scrap packaging, recovered fiber, scrap ferrous and nonferrous metals, or electronic 

scrap generated by an individual or business. 

‘‘(ii) ELECTRONIC SCRAP.—For purposes of 

clause (i), the term ‘electronic scrap’ 

means— 

‘‘(I) any cathode ray tube, flat panel 

screen, or similar video display device with a 

screen size greater than 4 inches measured 

diagonally, or 

‘‘(II) any central processing unit. 

‘‘(C) RECYCLING OR RECYCLE.—The term ‘recycling’ or ‘recycle’ means that process (including sorting) by which worn or superfluous materials are manufactured or processed into specification grade commodities 

that are suitable for use as a replacement or 

substitute for virgin materials in manufacturing tangible consumer and commercial 

products, including packaging.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to property 

placed in service after August 31, 2008. 

TITLE IV—REVENUE PROVISIONS 

SEC. 401. LIMITATION OF DEDUCTION FOR INCOME ATTRIBUTABLE TO DOMESTIC 

PRODUCTION OF OIL, GAS, OR PRIMARY PRODUCTS THEREOF. 

(a) IN GENERAL.—Section 199(d) is amended 

by redesignating paragraph (9) as paragraph 

(10) and by inserting after paragraph (8) the 

following new paragraph: 

‘‘(9) SPECIAL RULE FOR TAXPAYERS WITH OIL

RELATED QUALIFIED PRODUCTION ACTIVITIES INCOME.— 

‘‘(A) IN GENERAL.—If a taxpayer has oil related qualified production activities income 

for any taxable year beginning after 2009, the 

amount otherwise allowable as a deduction 

under subsection (a) shall be reduced by 3 

percent of the least of— 

‘‘(i) the oil related qualified production activities income of the taxpayer for the taxable year, 

‘‘(ii) the qualified production activities income of the taxpayer for the taxable year, or 

‘‘(iii) taxable income (determined without 

regard to this section). 

‘‘(B) OIL RELATED QUALIFIED PRODUCTION

ACTIVITIES INCOME.—For purposes of this 

paragraph, the term ‘oil related qualified 

production activities income’ means for any 

taxable year the qualified production activities income which is attributable to the production, refining, processing, transportation, 

or distribution of oil, gas, or any primary 

product thereof during such taxable year. 

‘‘(C) PRIMARY PRODUCT.—For purposes of 

this paragraph, the term ‘primary product’ 

has the same meaning as when used in section 927(a)(2)(C), as in effect before its repeal.’’. 

(b) CONFORMING AMENDMENT.—Section 

199(d)(2) (relating to application to individuals) is amended by striking ‘‘subsection 

(a)(1)(B)’’ and inserting ‘‘subsections (a)(1)(B) 

and (d)(9)(A)(iii)’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2008. 

SEC. 402. ELIMINATION OF THE DIFFERENT 

TREATMENT OF FOREIGN OIL AND 

GAS EXTRACTION INCOME AND FOREIGN OIL RELATED INCOME FOR 

PURPOSES OF THE FOREIGN TAX 

CREDIT. 

(a) IN GENERAL.—Subsections (a) and (b) of 

section 907 (relating to special rules in case 

of foreign oil and gas income) are amended 

to read as follows: 

‘‘(a) REDUCTION IN AMOUNT ALLOWED AS

FOREIGN TAX UNDER SECTION 901.—In applying section 901, the amount of any foreign oil 

and gas taxes paid or accrued (or deemed to 

have been paid) during the taxable year 

which would (but for this subsection) be 

taken into account for purposes of section 

901 shall be reduced by the amount (if any) 

by which the amount of such taxes exceeds 

the product of— 

‘‘(1) the amount of the combined foreign oil 

and gas income for the taxable year, 

‘‘(2) multiplied by— 

‘‘(A) in the case of a corporation, the percentage which is equal to the highest rate of 

tax specified under section 11(b), or 

‘‘(B) in the case of an individual, a fraction 

the numerator of which is the tax against 

which the credit under section 901(a) is taken 

and the denominator of which is the taxpayer’s entire taxable income. 

‘‘(b) COMBINED FOREIGN OIL AND GAS INCOME; FOREIGN OIL AND GAS TAXES.—For purposes of this section— 

‘‘(1) COMBINED FOREIGN OIL AND GAS INCOME.—The term ‘combined foreign oil and 

gas income’ means, with respect to any taxable year, the sum of— 

‘‘(A) foreign oil and gas extraction income, 

and 

‘‘(B) foreign oil related income. 

‘‘(2) FOREIGN OIL AND GAS TAXES.—The term 

‘foreign oil and gas taxes’ means, with respect to any taxable year, the sum of— 

‘‘(A) oil and gas extraction taxes, and 

‘‘(B) any income, war profits, and excess 

profits taxes paid or accrued (or deemed to 

have been paid or accrued under section 902 

or 960) during the taxable year with respect 

to foreign oil related income (determined 

without regard to subsection (c)(4)) or loss 

which would be taken into account for purposes of section 901 without regard to this 

section.’’. 

(b) RECAPTURE OF FOREIGN OIL AND GAS

LOSSES.—Paragraph (4) of section 907(c) (relating to recapture of foreign oil and gas extraction losses by recharacterizing later extraction income) is amended to read as follows: 

‘‘(4) RECAPTURE OF FOREIGN OIL AND GAS

LOSSES BY RECHARACTERIZING LATER COMBINED FOREIGN OIL AND GAS INCOME.— 

‘‘(A) IN GENERAL.—The combined foreign 

oil and gas income of a taxpayer for a taxable year (determined without regard to this 

paragraph) shall be reduced— 

‘‘(i) first by the amount determined under 

subparagraph (B), and 

‘‘(ii) then by the amount determined under 

subparagraph (C). 

The aggregate amount of such reductions 

shall be treated as income (from sources 

without the United States) which is not combined foreign oil and gas income. 

‘‘(B) REDUCTION FOR PRE-2009 FOREIGN OIL

EXTRACTION LOSSES.—The reduction under 

this paragraph shall be equal to the lesser 

of— 

‘‘(i) the foreign oil and gas extraction income of the taxpayer for the taxable year 

(determined without regard to this paragraph), or 

‘‘(ii) the excess of— 

‘‘(I) the aggregate amount of foreign oil extraction losses for preceding taxable years 

beginning after December 31, 1982, and before 

January 1, 2009, over 

‘‘(II) so much of such aggregate amount as 

was recharacterized under this paragraph (as 

in effect before and after the date of the enactment of the Energy Improvement and Extension Act of 2008) for preceding taxable 

years beginning after December 31, 1982. 

‘‘(C) REDUCTION FOR POST-2008 FOREIGN OIL

AND GAS LOSSES.—The reduction under this 

paragraph shall be equal to the lesser of— 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10365 

‘‘(i) the combined foreign oil and gas income of the taxpayer for the taxable year 

(determined without regard to this paragraph), reduced by an amount equal to the 

reduction under subparagraph (A) for the 

taxable year, or 

‘‘(ii) the excess of— 

‘‘(I) the aggregate amount of foreign oil 

and gas losses for preceding taxable years beginning after December 31, 2008, over 

‘‘(II) so much of such aggregate amount as 

was recharacterized under this paragraph for 

preceding taxable years beginning after December 31, 2008. 

‘‘(D) FOREIGN OIL AND GAS LOSS DEFINED.— 

‘‘(i) IN GENERAL.—For purposes of this 

paragraph, the term ‘foreign oil and gas loss’ 

means the amount by which— 

‘‘(I) the gross income for the taxable year 

from sources without the United States and 

its possessions (whether or not the taxpayer 

chooses the benefits of this subpart for such 

taxable year) taken into account in determining the combined foreign oil and gas income for such year, is exceeded by 

‘‘(II) the sum of the deductions properly 

apportioned or allocated thereto. 

‘‘(ii) NET OPERATING LOSS DEDUCTION NOT

TAKEN INTO ACCOUNT.—For purposes of clause 

(i), the net operating loss deduction allowable for the taxable year under section 172(a) 

shall not be taken into account. 

‘‘(iii) EXPROPRIATION AND CASUALTY LOSSES

NOT TAKEN INTO ACCOUNT.—For purposes of 

clause (i), there shall not be taken into account— 

‘‘(I) any foreign expropriation loss (as defined in section 172(h) (as in effect on the day 

before the date of the enactment of the Revenue Reconciliation Act of 1990)) for the taxable year, or 

‘‘(II) any loss for the taxable year which 

arises from fire, storm, shipwreck, or other 

casualty, or from theft, 

to the extent such loss is not compensated 

for by insurance or otherwise. 

‘‘(iv) FOREIGN OIL EXTRACTION LOSS.—For 

purposes of subparagraph (B)(ii)(I), foreign 

oil extraction losses shall be determined 

under this paragraph as in effect on the day 

before the date of the enactment of the Energy Improvement and Extension Act of 

2008.’’. 

(c) CARRYBACK AND CARRYOVER OF DISALLOWED CREDITS.—Section 907(f) (relating 

to carryback and carryover of disallowed 

credits) is amended— 

(1) by striking ‘‘oil and gas extraction 

taxes’’ each place it appears and inserting 

‘‘foreign oil and gas taxes’’, and 

(2) by adding at the end the following new 

paragraph: 

‘‘(4) TRANSITION RULES FOR PRE-2009 AND 2009

DISALLOWED CREDITS.— 

‘‘(A) PRE-2009 CREDITS.—In the case of any 

unused credit year beginning before January 

1, 2009, this subsection shall be applied to 

any unused oil and gas extraction taxes carried from such unused credit year to a year 

beginning after December 31, 2008— 

‘‘(i) by substituting ‘oil and gas extraction 

taxes’ for ‘foreign oil and gas taxes’ each 

place it appears in paragraphs (1), (2), and (3), 

and 

‘‘(ii) by computing, for purposes of paragraph (2)(A), the limitation under subparagraph (A) for the year to which such taxes 

are carried by substituting ‘foreign oil and 

gas extraction income’ for ‘foreign oil and 

gas income’ in subsection (a). 

‘‘(B) 2009 CREDITS.—In the case of any unused credit year beginning in 2009, the 

amendments made to this subsection by the 

Energy Improvement and Extension Act of 

2008 shall be treated as being in effect for 

any preceding year beginning before January 

1, 2009, solely for purposes of determining 

how much of the unused foreign oil and gas 

taxes for such unused credit year may be 

deemed paid or accrued in such preceding 

year.’’. 

(d) CONFORMING AMENDMENT.—Section 

6501(i) is amended by striking ‘‘oil and gas 

extraction taxes’’ and inserting ‘‘foreign oil 

and gas taxes’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2008. 

SEC. 403. BROKER REPORTING OF CUSTOMER’S 

BASIS IN SECURITIES TRANSACTIONS. 

(a) IN GENERAL.— 

(1) BROKER REPORTING FOR SECURITIES

TRANSACTIONS.—Section 6045 is amended by 

adding at the end the following new subsection: 

‘‘(g) ADDITIONAL INFORMATION REQUIRED IN

THE CASE OF SECURITIES TRANSACTIONS, 

ETC.— 

‘‘(1) IN GENERAL.—If a broker is otherwise 

required to make a return under subsection 

(a) with respect to the gross proceeds of the 

sale of a covered security, the broker shall 

include in such return the information described in paragraph (2). 

‘‘(2) ADDITIONAL INFORMATION REQUIRED.— 

‘‘(A) IN GENERAL.—The information required under paragraph (1) to be shown on a 

return with respect to a covered security of 

a customer shall include the customer’s adjusted basis in such security and whether 

any gain or loss with respect to such security is long-term or short-term (within the 

meaning of section 1222). 

‘‘(B) DETERMINATION OF ADJUSTED BASIS.— 

For purposes of subparagraph (A)— 

‘‘(i) IN GENERAL.—The customer’s adjusted 

basis shall be determined— 

‘‘(I) in the case of any security (other than 

any stock for which an average basis method 

is permissible under section 1012), in accordance with the first-in first-out method unless 

the customer notifies the broker by means of 

making an adequate identification of the 

stock sold or transferred, and 

‘‘(II) in the case of any stock for which an 

average basis method is permissible under 

section 1012, in accordance with the broker’s 

default method unless the customer notifies 

the broker that he elects another acceptable 

method under section 1012 with respect to 

the account in which such stock is held. 

‘‘(ii) EXCEPTION FOR WASH SALES.—Except 

as otherwise provided by the Secretary, the 

customer’s adjusted basis shall be determined without regard to section 1091 (relating to loss from wash sales of stock or securities) unless the transactions occur in the 

same account with respect to identical securities. 

‘‘(3) COVERED SECURITY.—For purposes of 

this subsection— 

‘‘(A) IN GENERAL.—The term ‘covered security’ means any specified security acquired 

on or after the applicable date if such security— 

‘‘(i) was acquired through a transaction in 

the account in which such security is held, 

or 

‘‘(ii) was transferred to such account from 

an account in which such security was a covered security, but only if the broker received 

a statement under section 6045A with respect 

to the transfer. 

‘‘(B) SPECIFIED SECURITY.—The term ‘specified security’ means— 

‘‘(i) any share of stock in a corporation, 

‘‘(ii) any note, bond, debenture, or other 

evidence of indebtedness, 

‘‘(iii) any commodity, or contract or derivative with respect to such commodity, if the 

Secretary determines that adjusted basis reporting is appropriate for purposes of this 

subsection, and 

‘‘(iv) any other financial instrument with 

respect to which the Secretary determines 

that adjusted basis reporting is appropriate 

for purposes of this subsection. 

‘‘(C) APPLICABLE DATE.—The term ‘applicable date’ means— 

‘‘(i) January 1, 2011, in the case of any specified security which is stock in a corporation 

(other than any stock described in clause 

(ii)), 

‘‘(ii) January 1, 2012, in the case of any 

stock for which an average basis method is 

permissible under section 1012, and 

‘‘(iii) January 1, 2013, or such later date determined by the Secretary in the case of any 

other specified security. 

‘‘(4) TREATMENT OF S CORPORATIONS.—In 

the case of the sale of a covered security acquired by an S corporation (other than a financial institution) after December 31, 2011, 

such S corporation shall be treated in the 

same manner as a partnership for purposes of 

this section. 

‘‘(5) SPECIAL RULES FOR SHORT SALES.—In 

the case of a short sale, reporting under this 

section shall be made for the year in which 

such sale is closed.’’. 

(2) BROKER INFORMATION REQUIRED WITH RESPECT TO OPTIONS.—Section 6045, as amended 

by subsection (a), is amended by adding at 

the end the following new subsection: 

‘‘(h) APPLICATION TO OPTIONS ON SECURITIES.— 

‘‘(1) EXERCISE OF OPTION.—For purposes of 

this section, if a covered security is acquired 

or disposed of pursuant to the exercise of an 

option that was granted or acquired in the 

same account as the covered security, the 

amount received with respect to the grant or 

paid with respect to the acquisition of such 

option shall be treated as an adjustment to 

gross proceeds or as an adjustment to basis, 

as the case may be. 

‘‘(2) LAPSE OR CLOSING TRANSACTION.—In 

the case of the lapse (or closing transaction 

(as defined in section 1234(b)(2)(A))) of an option on a specified security or the exercise of 

a cash-settled option on a specified security, 

reporting under subsections (a) and (g) with 

respect to such option shall be made for the 

calendar year which includes the date of 

such lapse, closing transaction, or exercise. 

‘‘(3) PROSPECTIVE APPLICATION.—Paragraphs (1) and (2) shall not apply to any option which is granted or acquired before January 1, 2013. 

‘‘(4) DEFINITIONS.—For purposes of this subsection, the terms ‘covered security’ and 

‘specified security’ shall have the meanings 

given such terms in subsection (g)(3).’’. 

(3) EXTENSION OF PERIOD FOR STATEMENTS

SENT TO CUSTOMERS.— 

(A) IN GENERAL.—Subsection (b) of section 

6045 is amended by striking ‘‘January 31’’ 

and inserting ‘‘February 15’’. 

(B) STATEMENTS RELATED TO SUBSTITUTE

PAYMENTS.—Subsection (d) of section 6045 is 

amended— 

(i) by striking ‘‘at such time and’’, and 

(ii) by inserting after ‘‘other item.’’ the 

following new sentence: ‘‘The written statement required under the preceding sentence 

shall be furnished on or before February 15 of 

the year following the calendar year in 

which the payment was made.’’. 

(C) OTHER STATEMENTS.—Subsection (b) of 

section 6045 is amended by adding at the end 

the following: ‘‘In the case of a consolidated 

reporting statement (as defined in regulations) with respect to any customer, any 

statement which would otherwise be required to be furnished on or before January 

31 of a calendar year with respect to any 

item reportable to the taxpayer shall instead 

be required to be furnished on or before February 15 of such calendar year if furnished 

with such consolidated reporting statement.’’. 


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S10366 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(b) DETERMINATION OF BASIS OF CERTAIN

SECURITIES ON ACCOUNT BY ACCOUNT OR AVERAGE BASIS METHOD.—Section 1012 is amended— 

(1) by striking ‘‘The basis of property’’ and 

inserting the following: 

‘‘(a) IN GENERAL.—The basis of property’’, 

(2) by striking ‘‘The cost of real property’’ 

and inserting the following: 

‘‘(b) SPECIAL RULE FOR APPORTIONED REAL

ESTATE TAXES.—The cost of real property’’, 

and 

(3) by adding at the end the following new 

subsections: 

‘‘(c) DETERMINATIONS BY ACCOUNT.— 

‘‘(1) IN GENERAL.—In the case of the sale, 

exchange, or other disposition of a specified 

security on or after the applicable date, the 

conventions prescribed by regulations under 

this section shall be applied on an account 

by account basis. 

‘‘(2) APPLICATION TO CERTAIN FUNDS.— 

‘‘(A) IN GENERAL.—Except as provided in 

subparagraph (B), any stock for which an average basis method is permissible under section 1012 which is acquired before January 1, 

2012, shall be treated as a separate account 

from any such stock acquired on or after 

such date. 

‘‘(B) ELECTION FUND FOR TREATMENT AS SINGLE ACCOUNT.—If a fund described in subparagraph (A) elects to have this subparagraph 

apply with respect to one or more of its 

stockholders— 

‘‘(i) subparagraph (A) shall not apply with 

respect to any stock in such fund held by 

such stockholders, and 

‘‘(ii) all stock in such fund which is held by 

such stockholders shall be treated as covered 

securities described in section 6045(g)(3) 

without regard to the date of the acquisition 

of such stock. 

A rule similar to the rule of the preceding 

sentence shall apply with respect to a broker 

holding such stock as a nominee. 

‘‘(3) DEFINITIONS.—For purposes of this section, the terms ‘specified security’ and ‘applicable date’ shall have the meaning given 

such terms in section 6045(g). 

‘‘(d) AVERAGE BASIS FOR STOCK ACQUIRED

PURSUANT TO A DIVIDEND REINVESTMENT

PLAN.— 

‘‘(1) IN GENERAL.—In the case of any stock 

acquired after December 31, 2010, in connection with a dividend reinvestment plan, the 

basis of such stock while held as part of such 

plan shall be determined using one of the 

methods which may be used for determining 

the basis of stock in an open-end fund. 

‘‘(2) TREATMENT AFTER TRANSFER.—In the 

case of the transfer to another account of 

stock to which paragraph (1) applies, such 

stock shall have a cost basis in such other 

account equal to its basis in the dividend reinvestment plan immediately before such 

transfer (properly adjusted for any fees or 

other charges taken into account in connection with such transfer). 

‘‘(3) SEPARATE ACCOUNTS; ELECTION FOR

TREATMENT AS SINGLE ACCOUNT.—Rules similar to the rules of subsection (c)(2) shall 

apply for purposes of this subsection. 

‘‘(4) DIVIDEND REINVESTMENT PLAN.—For 

purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘dividend reinvestment plan’ means any arrangement 

under which dividends on any stock are reinvested in stock identical to the stock with 

respect to which the dividends are paid. 

‘‘(B) INITIAL STOCK ACQUISITION TREATED AS

ACQUIRED IN CONNECTION WITH PLAN.—Stock 

shall be treated as acquired in connection 

with a dividend reinvestment plan if such 

stock is acquired pursuant to such plan or if 

the dividends paid on such stock are subject 

to such plan.’’. 

(c) INFORMATION BY TRANSFERORS TO AID

BROKERS.— 

(1) IN GENERAL.—Subpart B of part III of 

subchapter A of chapter 61 is amended by inserting after section 6045 the following new 

section: 

‘‘SEC. 6045A. INFORMATION REQUIRED IN CONNECTION WITH TRANSFERS OF COVERED SECURITIES TO BROKERS. 

‘‘(a) FURNISHING OF INFORMATION.—Every 

applicable person which transfers to a broker 

(as defined in section 6045(c)(1)) a security 

which is a covered security (as defined in 

section 6045(g)(3)) in the hands of such applicable person shall furnish to such broker a 

written statement in such manner and setting forth such information as the Secretary 

may by regulations prescribe for purposes of 

enabling such broker to meet the requirements of section 6045(g). 

‘‘(b) APPLICABLE PERSON.—For purposes of 

subsection (a), the term ‘applicable person’ 

means— 

‘‘(1) any broker (as defined in section 

6045(c)(1)), and 

‘‘(2) any other person as provided by the 

Secretary in regulations. 

‘‘(c) TIME FOR FURNISHING STATEMENT.— 

Except as otherwise provided by the Secretary, any statement required by subsection 

(a) shall be furnished not later than 15 days 

after the date of the transfer described in 

such subsection.’’. 

(2) ASSESSABLE PENALTIES.—Paragraph (2) 

of section 6724(d), as amended by the Housing 

Assistance Tax Act of 2008, is amended by redesignating subparagraphs (I) through (DD) 

as subparagraphs (J) through (EE), respectively, and by inserting after subparagraph 

(H) the following new subparagraph: 

‘‘(I) section 6045A (relating to information 

required in connection with transfers of covered securities to brokers),’’. 

(3) CLERICAL AMENDMENT.—The table of 

sections for subpart B of part III of subchapter A of chapter 61 is amended by inserting after the item relating to section 6045 the 

following new item: 

‘‘Sec. 6045A. Information required in connection with transfers of covered 

securities to brokers.’’. 

(d) ADDITIONAL ISSUER INFORMATION TO AID

BROKERS.— 

(1) IN GENERAL.—Subpart B of part III of 

subchapter A of chapter 61, as amended by 

subsection (b), is amended by inserting after 

section 6045A the following new section: 

‘‘SEC. 6045B. RETURNS RELATING TO ACTIONS 

AFFECTING BASIS OF SPECIFIED SECURITIES. 

‘‘(a) IN GENERAL.—According to the forms 

or regulations prescribed by the Secretary, 

any issuer of a specified security shall make 

a return setting forth— 

‘‘(1) a description of any organizational action which affects the basis of such specified 

security of such issuer, 

‘‘(2) the quantitative effect on the basis of 

such specified security resulting from such 

action, and 

‘‘(3) such other information as the Secretary may prescribe. 

‘‘(b) TIME FOR FILING RETURN.—Any return 

required by subsection (a) shall be filed not 

later than the earlier of— 

‘‘(1) 45 days after the date of the action described in subsection (a), or 

‘‘(2) January 15 of the year following the 

calendar year during which such action occurred. 

‘‘(c) STATEMENTS TO BE FURNISHED TO

HOLDERS OF SPECIFIED SECURITIES OR THEIR

NOMINEES.—According to the forms or regulations prescribed by the Secretary, every 

person required to make a return under subsection (a) with respect to a specified security shall furnish to the nominee with respect to the specified security (or certificate 

holder if there is no nominee) a written 

statement showing— 

‘‘(1) the name, address, and phone number 

of the information contact of the person required to make such return, 

‘‘(2) the information required to be shown 

on such return with respect to such security, 

and 

‘‘(3) such other information as the Secretary may prescribe. 

The written statement required under the 

preceding sentence shall be furnished to the 

holder on or before January 15 of the year 

following the calendar year during which the 

action described in subsection (a) occurred. 

‘‘(d) SPECIFIED SECURITY.—For purposes of 

this section, the term ‘specified security’ has 

the meaning given such term by section 

6045(g)(3)(B). No return shall be required 

under this section with respect to actions described in subsection (a) with respect to a 

specified security which occur before the applicable date (as defined in section 

6045(g)(3)(C)) with respect to such security. 

‘‘(e) PUBLIC REPORTING IN LIEU OF RETURN.—The Secretary may waive the requirements under subsections (a) and (c) 

with respect to a specified security, if the 

person required to make the return under 

subsection (a) makes publicly available, in 

such form and manner as the Secretary determines necessary to carry out the purposes 

of this section— 

‘‘(1) the name, address, phone number, and 

email address of the information contact of 

such person, and 

‘‘(2) the information described in paragraphs (1), (2), and (3) of subsection (a).’’. 

(2) ASSESSABLE PENALTIES.— 

(A) Subparagraph (B) of section 6724(d)(1), 

as amended by the Housing Assistance Tax 

Act of 2008, is amended by redesignating 

clause (iv) and each of the clauses which follow as clauses (v) through (xxiii), respectively, and by inserting after clause (iii) the 

following new clause: 

‘‘(iv) section 6045B(a) (relating to returns 

relating to actions affecting basis of specified securities),’’. 

(B) Paragraph (2) of section 6724(d), as 

amended by the Housing Assistance Tax Act 

of 2008 and by subsection (c)(2), is amended 

by redesignating subparagraphs (J) through 

(EE) as subparagraphs (K) through (FF), respectively, and by inserting after subparagraph (I) the following new subparagraph: 

‘‘(J) subsections (c) and (e) of section 6045B 

(relating to returns relating to actions affecting basis of specified securities),’’. 

(3) CLERICAL AMENDMENT.—The table of 

sections for subpart B of part III of subchapter A of chapter 61, as amended by subsection (b)(3), is amended by inserting after 

the item relating to section 6045A the following new item: 

‘‘Sec. 6045B. Returns relating to actions affecting basis of specified securities.’’. 

(e) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall take effect on 

January 1, 2011. 

(2) EXTENSION OF PERIOD FOR STATEMENTS

SENT TO CUSTOMERS.—The amendments made 

by subsection (a)(3) shall apply to statements required to be furnished after December 31, 2008. 

SEC. 404. 0.2 PERCENT FUTA SURTAX. 

(a) IN GENERAL.—Section 3301 (relating to 

rate of tax) is amended— 

(1) by striking ‘‘through 2008’’ in paragraph 

(1) and inserting ‘‘through 2009’’, and 

(2) by striking ‘‘calendar year 2009’’ in 

paragraph (2) and inserting ‘‘calendar year 

2010’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to wages 

paid after December 31, 2008. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10367 

SEC. 405. INCREASE AND EXTENSION OF OIL 

SPILL LIABILITY TRUST FUND TAX. 

(a) INCREASE IN RATE.— 

(1) IN GENERAL.—Section 4611(c)(2)(B) (relating to rates) is amended by striking ‘‘is 5 

cents a barrel.’’ and inserting ‘‘is— 

‘‘(i) in the case of crude oil received or petroleum products entered before January 1, 

2017, 8 cents a barrel, and 

‘‘(ii) in the case of crude oil received or petroleum products entered after December 31, 

2016, 9 cents a barrel.’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply on and 

after the first day of the first calendar quarter beginning more than 60 days after the 

date of the enactment of this Act. 

(b) EXTENSION.— 

(1) IN GENERAL.—Section 4611(f) (relating to 

application of Oil Spill Liability Trust Fund 

financing rate) is amended by striking paragraphs (2) and (3) and inserting the following 

new paragraph: 

‘‘(2) TERMINATION.—The Oil Spill Liability 

Trust Fund financing rate shall not apply 

after December 31, 2017.’’. 

(2) CONFORMING AMENDMENT.—Section 

4611(f)(1) is amended by striking ‘‘paragraphs 

(2) and (3)’’ and inserting ‘‘paragraph (2)’’. 

(3) EFFECTIVE DATE.—The amendments 

made by this subsection shall take effect on 

the date of the enactment of this Act. 

DIVISION C—TAX EXTENDERS AND 

ALTERNATIVE MINIMUM TAX RELIEF 

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 

CODE; TABLE OF CONTENTS. 

(a) SHORT TITLE.—This division may be 

cited as the ‘‘Tax Extenders and Alternative 

Minimum Tax Relief Act of 2008’’. 

(b) AMENDMENT OF 1986 CODE.—Except as 

otherwise expressly provided, whenever in 

this division an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a 

section or other provision of the Internal 

Revenue Code of 1986. 

(c) TABLE OF CONTENTS.—The table of contents of this division is as follows: 

Sec. 1. Short title; amendment of 1986 Code; 

table of contents. 

TITLE I—ALTERNATIVE MINIMUM TAX 

RELIEF 

Sec. 101. Extension of alternative minimum 

tax relief for nonrefundable personal credits. 

Sec. 102. Extension of increased alternative 

minimum tax exemption 

amount. 

Sec. 103. Increase of AMT refundable credit 

amount for individuals with 

long-term unused credits for 

prior year minimum tax liability, etc. 

TITLE II—EXTENSION OF INDIVIDUAL 

TAX PROVISIONS 

Sec. 201. Deduction for State and local sales 

taxes. 

Sec. 202. Deduction of qualified tuition and 

related expenses. 

Sec. 203. Deduction for certain expenses of 

elementary and secondary 

school teachers. 

Sec. 204. Additional standard deduction for 

real property taxes for nonitemizers. 

Sec. 205. Tax-free distributions from individual retirement plans for 

charitable purposes. 

Sec. 206. Treatment of certain dividends of 

regulated investment companies. 

Sec. 207. Stock in RIC for purposes of determining estates of nonresidents 

not citizens. 

Sec. 208. Qualified investment entities. 

TITLE III—EXTENSION OF BUSINESS TAX 

PROVISIONS 

Sec. 301. Extension and modification of research credit. 

Sec. 302. New markets tax credit. 

Sec. 303. Subpart F exception for active financing income. 

Sec. 304. Extension of look-thru rule for related controlled foreign corporations. 

Sec. 305. Extension of 15-year straight-line 

cost recovery for qualified 

leasehold improvements and 

qualified restaurant improvements; 15-year straight-line 

cost recovery for certain improvements to retail space. 

Sec. 306. Modification of tax treatment of 

certain payments to controlling 

exempt organizations. 

Sec. 307. Basis adjustment to stock of S corporations making charitable 

contributions of property. 

Sec. 308. Increase in limit on cover over of 

rum excise tax to Puerto Rico 

and the Virgin Islands. 

Sec. 309. Extension of economic development credit for American 

Samoa. 

Sec. 310. Extension of mine rescue team 

training credit. 

Sec. 311. Extension of election to expense 

advanced mine safety equipment. 

Sec. 312. Deduction allowable with respect 

to income attributable to domestic production activities in 

Puerto Rico. 

Sec. 313. Qualified zone academy bonds. 

Sec. 314. Indian employment credit. 

Sec. 315. Accelerated depreciation for business property on Indian reservations. 

Sec. 316. Railroad track maintenance. 

Sec. 317. Seven-year cost recovery period for 

motorsports racing track facility. 

Sec. 318. Expensing of environmental remediation costs. 

Sec. 319. Extension of work opportunity tax 

credit for Hurricane Katrina 

employees. 

Sec. 320. Extension of increased rehabilitation credit for structures in the 

Gulf Opportunity Zone. 

Sec. 321. Enhanced deduction for qualified 

computer contributions. 

Sec. 322. Tax incentives for investment in 

the District of Columbia. 

Sec. 323. Enhanced charitable deductions for 

contributions of food inventory. 

Sec. 324. Extension of enhanced charitable 

deduction for contributions of 

book inventory. 

Sec. 325. Extension and modification of duty 

suspension on wool products; 

wool research fund; wool duty 

refunds. 

TITLE IV—EXTENSION OF TAX 

ADMINISTRATION PROVISIONS 

Sec. 401. Permanent authority for undercover operations. 

Sec. 402. Permanent authority for disclosure 

of information relating to terrorist activities. 

TITLE V—ADDITIONAL TAX RELIEF AND 

OTHER TAX PROVISIONS 

Subtitle A—General Provisions 

Sec. 501. $8,500 income threshold used to calculate refundable portion of 

child tax credit. 

Sec. 502. Provisions related to film and television productions. 

Sec. 503. Exemption from excise tax for certain wooden arrows designed for 

use by children. 

Sec. 504. Income averaging for amounts received in connection with the 

Exxon Valdez litigation. 

Sec. 505. Certain farming business machinery and equipment treated as 5- 

year property. 

Sec. 506. Modification of penalty on understatement of taxpayer’s liability by tax return preparer. 

Subtitle B—Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 

Sec. 511. Short title. 

Sec. 512. Mental health parity. 

TITLE VI—OTHER PROVISIONS 

Sec. 601. Secure rural schools and community self-determination program. 

Sec. 602. Transfer to abandoned mine reclamation fund. 

TITLE VII—DISASTER RELIEF 

Subtitle A—Heartland and Hurricane Ike 

Disaster Relief 

Sec. 701. Short title. 

Sec. 702. Temporary tax relief for areas 

damaged by 2008 Midwestern severe storms, tornados, and 

flooding. 

Sec. 703. Reporting requirements relating to 

disaster relief contributions. 

Sec. 704. Temporary tax-exempt bond financing and low-income housing tax relief for areas damaged 

by Hurricane Ike. 

Subtitle B—National Disaster Relief 

Sec. 706. Losses attributable to federally declared disasters. 

Sec. 707. Expensing of Qualified Disaster Expenses. 

Sec. 708. Net operating losses attributable to 

federally declared disasters. 

Sec. 709. Waiver of certain mortgage revenue bond requirements following federally declared disasters. 

Sec. 710. Special depreciation allowance for 

qualified disaster property. 

Sec. 711. Increased expensing for qualified 

disaster assistance property. 

Sec. 712. Coordination with Heartland disaster relief. 

TITLE VIII—SPENDING REDUCTIONS AND 

APPROPRIATE REVENUE RAISERS FOR 

NEW TAX RELIEF POLICY 

Sec. 801. Nonqualified deferred compensation from certain tax indifferent parties. 

TITLE I—ALTERNATIVE MINIMUM TAX 

RELIEF 

SEC. 101. EXTENSION OF ALTERNATIVE MINIMUM 

TAX RELIEF FOR NONREFUNDABLE 

PERSONAL CREDITS. 

(a) IN GENERAL.—Paragraph (2) of section 

26(a) (relating to special rule for taxable 

years 2000 through 2007) is amended— 

(1) by striking ‘‘or 2007’’ and inserting 

‘‘2007, or 2008’’, and 

(2) by striking ‘‘2007’’ in the heading thereof 

and inserting ‘‘2008’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 102. EXTENSION OF INCREASED ALTERNATIVE MINIMUM TAX EXEMPTION 

AMOUNT. 

(a) IN GENERAL.—Paragraph (1) of section 

55(d) (relating to exemption amount) is 

amended— 

(1) by striking ‘‘($66,250 in the case of taxable years beginning in 2007)’’ in subparagraph (A) and inserting ‘‘($69,950 in the case 

of taxable years beginning in 2008)’’, and 

(2) by striking ‘‘($44,350 in the case of taxable years beginning in 2007)’’ in subparagraph (B) and inserting ‘‘($46,200 in the case 

of taxable years beginning in 2008)’’. 


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S10368 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 103. INCREASE OF AMT REFUNDABLE CREDIT AMOUNT FOR INDIVIDUALS WITH 

LONG-TERM UNUSED CREDITS FOR 

PRIOR YEAR MINIMUM TAX LIABILITY, ETC. 

(a) IN GENERAL.—Paragraph (2) of section 

53(e) is amended to read as follows: 

‘‘(2) AMT REFUNDABLE CREDIT AMOUNT.— 

For purposes of paragraph (1), the term 

‘AMT refundable credit amount’ means, with 

respect to any taxable year, the amount (not 

in excess of the long-term unused minimum 

tax credit for such taxable year) equal to the 

greater of— 

‘‘(A) 50 percent of the long-term unused 

minimum tax credit for such taxable year, or 

‘‘(B) the amount (if any) of the AMT refundable credit amount determined under 

this paragraph for the taxpayer’s preceding 

taxable year (determined without regard to 

subsection (f)(2)).’’. 

(b) TREATMENT OF CERTAIN UNDERPAYMENTS, INTEREST, AND PENALTIES ATTRIBUTABLE TO THE TREATMENT OF INCENTIVE

STOCK OPTIONS.—Section 53 is amended by 

adding at the end the following new subsection: 

‘‘(f) TREATMENT OF CERTAIN UNDERPAYMENTS, INTEREST, AND PENALTIES ATTRIBUTABLE TO THE TREATMENT OF INCENTIVE

STOCK OPTIONS.— 

‘‘(1) ABATEMENT.—Any underpayment of 

tax outstanding on the date of the enactment of this subsection which is attributable 

to the application of section 56(b)(3) for any 

taxable year ending before January 1, 2008, 

and any interest or penalty with respect to 

such underpayment which is outstanding on 

such date of enactment, is hereby abated. 

The amount determined under subsection 

(b)(1) shall not include any tax abated under 

the preceding sentence. 

‘‘(2) INCREASE IN CREDIT FOR CERTAIN INTEREST AND PENALTIES ALREADY PAID.—The AMT 

refundable credit amount, and the minimum 

tax credit determined under subsection (b), 

for the taxpayer’s first 2 taxable years beginning after December 31, 2007, shall each be 

increased by 50 percent of the aggregate 

amount of the interest and penalties which 

were paid by the taxpayer before the date of 

the enactment of this subsection and which 

would (but for such payment) have been 

abated under paragraph (1).’’. 

(c) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as provided in 

paragraph (2), the amendments made by this 

section shall apply to taxable years beginning after December 31, 2007. 

(2) ABATEMENT.—Section 53(f)(1), as added 

by subsection (b), shall take effect on the 

date of the enactment of this Act. 

TITLE II—EXTENSION OF INDIVIDUAL TAX 

PROVISIONS 

SEC. 201. DEDUCTION FOR STATE AND LOCAL 

SALES TAXES. 

(a) IN GENERAL.—Subparagraph (I) of section 164(b)(5) is amended by striking ‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 202. DEDUCTION OF QUALIFIED TUITION 

AND RELATED EXPENSES. 

(a) IN GENERAL.—Subsection (e) of section 

222 (relating to termination) is amended by 

striking ‘‘December 31, 2007’’ and inserting 

‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 203. DEDUCTION FOR CERTAIN EXPENSES 

OF ELEMENTARY AND SECONDARY 

SCHOOL TEACHERS. 

(a) IN GENERAL.—Subparagraph (D) of section 62(a)(2) (relating to certain expenses of 

elementary and secondary school teachers) is 

amended by striking ‘‘or 2007’’ and inserting 

‘‘2007, 2008, or 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by subsection (a) shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 204. ADDITIONAL STANDARD DEDUCTION 

FOR REAL PROPERTY TAXES FOR 

NONITEMIZERS. 

(a) IN GENERAL.—Subparagraph (C) of section 63(c)(1), as added by the Housing Assistance Tax Act of 2008, is amended by inserting 

‘‘or 2009’’ after ‘‘2008’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years beginning after December 31, 2008. 

SEC. 205. TAX-FREE DISTRIBUTIONS FROM INDIVIDUAL RETIREMENT PLANS FOR 

CHARITABLE PURPOSES. 

(a) IN GENERAL.—Subparagraph (F) of section 408(d)(8) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to distributions made in taxable years beginning after 

December 31, 2007. 

SEC. 206. TREATMENT OF CERTAIN DIVIDENDS 

OF REGULATED INVESTMENT COMPANIES. 

(a) INTEREST-RELATED DIVIDENDS.—Subparagraph (C) of section 871(k)(1) (defining 

interest-related dividend) is amended by 

striking ‘‘December 31, 2007’’ and inserting 

‘‘December 31, 2009’’. 

(b) SHORT-TERM CAPITAL GAIN DIVIDENDS.— 

Subparagraph (C) of section 871(k)(2) (defining short-term capital gain dividend) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to dividends 

with respect to taxable years of regulated investment companies beginning after December 31, 2007. 

SEC. 207. STOCK IN RIC FOR PURPOSES OF DETERMINING ESTATES OF NONRESIDENTS NOT CITIZENS. 

(a) IN GENERAL.—Paragraph (3) of section 

2105(d) (relating to stock in a RIC) is amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to decedents 

dying after December 31, 2007. 

SEC. 208. QUALIFIED INVESTMENT ENTITIES. 

(a) IN GENERAL.—Clause (ii) of section 

897(h)(4)(A) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by subsection (a) shall take effect on 

January 1, 2008. 

TITLE III—EXTENSION OF BUSINESS TAX 

PROVISIONS 

SEC. 301. EXTENSION AND MODIFICATION OF RESEARCH CREDIT. 

(a) EXTENSION.— 

(1) IN GENERAL.—Section 41(h) (relating to 

termination) is amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 

2009’’ in paragraph (1)(B). 

(2) CONFORMING AMENDMENT.—Subparagraph (D) of section 45C(b)(1) (relating to 

special rule) is amended by striking ‘‘after 

December 31, 2007’’ and inserting ‘‘after December 31, 2009’’. 

(b) TERMINATION OF ALTERNATIVE INCREMENTAL CREDIT.—Section 41(h) is amended by 

redesignating paragraph (2) as paragraph (3), 

and by inserting after paragraph (1) the following new paragraph: 

‘‘(2) TERMINATION OF ALTERNATIVE INCREMENTAL CREDIT.—No election under subsection (c)(4) shall apply to taxable years beginning after December 31, 2008.’’. 

(c) MODIFICATION OF ALTERNATIVE SIMPLIFIED CREDIT.—Paragraph (5)(A) of section 

41(c) (relating to election of alternative simplified credit) is amended by striking ‘‘12 

percent’’ and inserting ‘‘14 percent (12 percent in the case of taxable years ending before January 1, 2009)’’. 

(d) TECHNICAL CORRECTION.—Paragraph (3) 

of section 41(h) is amended to read as follows: 

‘‘(2) COMPUTATION FOR TAXABLE YEAR IN

WHICH CREDIT TERMINATES.—In the case of 

any taxable year with respect to which this 

section applies to a number of days which is 

less than the total number of days in such 

taxable year— 

‘‘(A) the amount determined under subsection (c)(1)(B) with respect to such taxable 

year shall be the amount which bears the 

same ratio to such amount (determined 

without regard to this paragraph) as the 

number of days in such taxable year to 

which this section applies bears to the total 

number of days in such taxable year, and 

‘‘(B) for purposes of subsection (c)(5), the 

average qualified research expenses for the 

preceding 3 taxable years shall be the 

amount which bears the same ratio to such 

average qualified research expenses (determined without regard to this paragraph) as 

the number of days in such taxable year to 

which this section applies bears to the total 

number of days in such taxable year.’’. 

(e) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as provided in 

paragraph (2), the amendments made by this 

section shall apply to taxable years beginning after December 31, 2007. 

(2) EXTENSION.—The amendments made by 

subsection (a) shall apply to amounts paid or 

incurred after December 31, 2007. 

SEC. 302. NEW MARKETS TAX CREDIT. 

Subparagraph (D) of section 45D(f)(1) (relating to national limitation on amount of 

investments designated) is amended by 

striking ‘‘and 2008’’ and inserting ‘‘2008, and 

2009’’. 

SEC. 303. SUBPART F EXCEPTION FOR ACTIVE FINANCING INCOME. 

(a) EXEMPT INSURANCE INCOME.—Paragraph 

(10) of section 953(e) (relating to application) 

is amended— 

(1) by striking ‘‘January 1, 2009’’ and inserting ‘‘January 1, 2010’’, and 

(2) by striking ‘‘December 31, 2008’’ and inserting ‘‘December 31, 2009’’. 

(b) EXCEPTION TO TREATMENT AS FOREIGN

PERSONAL HOLDING COMPANY INCOME.—Paragraph (9) of section 954(h) (relating to application) is amended by striking ‘‘January 1, 

2009’’ and inserting ‘‘January 1, 2010’’. 

SEC. 304. EXTENSION OF LOOK-THRU RULE FOR 

RELATED CONTROLLED FOREIGN 

CORPORATIONS. 

(a) IN GENERAL.—Subparagraph (C) of section 954(c)(6) (relating to application) is 

amended by striking ‘‘January 1, 2009’’ and 

inserting ‘‘January 1, 2010’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years of foreign corporations beginning after 

December 31, 2007, and to taxable years of 

United States shareholders with or within 

which such taxable years of foreign corporations end. 

SEC. 305. EXTENSION OF 15-YEAR STRAIGHT-LINE 

COST RECOVERY FOR QUALIFIED 

LEASEHOLD IMPROVEMENTS AND 

QUALIFIED RESTAURANT IMPROVEMENTS; 15-YEAR STRAIGHT-LINE 

COST RECOVERY FOR CERTAIN IMPROVEMENTS TO RETAIL SPACE. 

(a) EXTENSION OF LEASEHOLD AND RESTAURANT IMPROVEMENTS.— 

(1) IN GENERAL.—Clauses (iv) and (v) of section 168(e)(3)(E) (relating to 15-year property) are each amended by striking ‘‘January 

1, 2008’’ and inserting ‘‘January 1, 2010’’. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10369 

(2) EFFECTIVE DATE.—The amendments 

made by this subsection shall apply to property placed in service after December 31, 

2007. 

(b) TREATMENT TO INCLUDE NEW CONSTRUCTION.— 

(1) IN GENERAL.—Paragraph (7) of section 

168(e) (relating to classification of property) 

is amended to read as follows: 

‘‘(7) QUALIFIED RESTAURANT PROPERTY.— 

‘‘(A) IN GENERAL.—The term ‘qualified restaurant property’ means any section 1250 

property which is— 

‘‘(i) a building, if such building is placed in 

service after December 31, 2008, and before 

January 1, 2010, or 

‘‘(ii) an improvement to a building, 

if more than 50 percent of the building’s 

square footage is devoted to preparation of, 

and seating for on-premises consumption of, 

prepared meals. 

‘‘(B) EXCLUSION FROM BONUS DEPRECIATION.—Property described in this paragraph 

shall not be considered qualified property for 

purposes of subsection (k).’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply to property placed in service after December 31, 

2008. 

(c) RECOVERY PERIOD FOR DEPRECIATION OF

CERTAIN IMPROVEMENTS TO RETAIL SPACE.— 

(1) 15-YEAR RECOVERY PERIOD.—Section 

168(e)(3)(E) (relating to 15-year property) is 

amended by striking ‘‘and’’ at the end of 

clause (vii), by striking the period at the end 

of clause (viii) and inserting ‘‘, and’’, and by 

adding at the end the following new clause: 

‘‘(ix) any qualified retail improvement 

property placed in service after December 31, 

2008, and before January 1, 2010.’’. 

(2) QUALIFIED RETAIL IMPROVEMENT PROPERTY.—Section 168(e) is amended by adding 

at the end the following new paragraph: 

‘‘(8) QUALIFIED RETAIL IMPROVEMENT PROPERTY.— 

‘‘(A) IN GENERAL.—The term ‘qualified retail improvement property’ means any improvement to an interior portion of a building which is nonresidential real property if— 

‘‘(i) such portion is open to the general 

public and is used in the retail trade or business of selling tangible personal property to 

the general public, and 

‘‘(ii) such improvement is placed in service 

more than 3 years after the date the building 

was first placed in service. 

‘‘(B) IMPROVEMENTS MADE BY OWNER.—In 

the case of an improvement made by the 

owner of such improvement, such improvement shall be qualified retail improvement 

property (if at all) only so long as such improvement is held by such owner. Rules similar to the rules under paragraph (6)(B) shall 

apply for purposes of the preceding sentence. 

‘‘(C) CERTAIN IMPROVEMENTS NOT INCLUDED.—Such term shall not include any 

improvement for which the expenditure is 

attributable to— 

‘‘(i) the enlargement of the building, 

‘‘(ii) any elevator or escalator, 

‘‘(iii) any structural component benefitting a common area, or 

‘‘(iv) the internal structural framework of 

the building. 

‘‘(D) EXCLUSION FROM BONUS DEPRECIATION.—Property described in this paragraph 

shall not be considered qualified property for 

purposes of subsection (k). 

‘‘(E) TERMINATION.—Such term shall not 

include any improvement placed in service 

after December 31, 2009.’’. 

(3) REQUIREMENT TO USE STRAIGHT LINE

METHOD.—Section 168(b)(3) is amended by 

adding at the end the following new subparagraph: 

‘‘(I) Qualified retail improvement property 

described in subsection (e)(8).’’. 

(4) ALTERNATIVE SYSTEM.—The table contained in section 168(g)(3)(B) is amended by 

inserting after the item relating to subparagraph (E)(viii) the following new item: 

‘‘(E)(ix) ........................................ 39’’. 

(5) EFFECTIVE DATE.—The amendments 

made by this subsection shall apply to property placed in service after December 31, 

2008. 

SEC. 306. MODIFICATION OF TAX TREATMENT OF 

CERTAIN PAYMENTS TO CONTROLLING EXEMPT ORGANIZATIONS. 

(a) IN GENERAL.—Clause (iv) of section 

512(b)(13)(E) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to payments 

received or accrued after December 31, 2007. 

SEC. 307. BASIS ADJUSTMENT TO STOCK OF S 

CORPORATIONS MAKING CHARITABLE CONTRIBUTIONS OF PROPERTY. 

(a) IN GENERAL.—The last sentence of section 1367(a)(2) (relating to decreases in basis) 

is amended by striking ‘‘December 31, 2007’’ 

and inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to contributions made in taxable years beginning after 

December 31, 2007. 

SEC. 308. INCREASE IN LIMIT ON COVER OVER OF 

RUM EXCISE TAX TO PUERTO RICO 

AND THE VIRGIN ISLANDS. 

(a) IN GENERAL.—Paragraph (1) of section 

7652(f) is amended by striking ‘‘January 1, 

2008’’ and inserting ‘‘January 1, 2010’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to distilled 

spirits brought into the United States after 

December 31, 2007. 

SEC. 309. EXTENSION OF ECONOMIC DEVELOPMENT CREDIT FOR AMERICAN 

SAMOA. 

(a) IN GENERAL.—Subsection (d) of section 

119 of division A of the Tax Relief and Health 

Care Act of 2006 is amended— 

(1) by striking ‘‘first two taxable years’’ 

and inserting ‘‘first 4 taxable years’’, and 

(2) by striking ‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 310. EXTENSION OF MINE RESCUE TEAM 

TRAINING CREDIT. 

Section 45N(e) (relating to termination) is 

amended by striking ‘‘December 31, 2008’’ and 

inserting ‘‘December 31, 2009’’. 

SEC. 311. EXTENSION OF ELECTION TO EXPENSE 

ADVANCED MINE SAFETY EQUIPMENT. 

Section 179E(g) (relating to termination) is 

amended by striking ‘‘December 31, 2008’’ and 

inserting ‘‘December 31, 2009’’. 

SEC. 312. DEDUCTION ALLOWABLE WITH RESPECT TO INCOME ATTRIBUTABLE 

TO DOMESTIC PRODUCTION ACTIVITIES IN PUERTO RICO. 

(a) IN GENERAL.—Subparagraph (C) of section 199(d)(8) (relating to termination) is 

amended— 

(1) by striking ‘‘first 2 taxable years’’ and 

inserting ‘‘first 4 taxable years’’, and 

(2) by striking ‘‘January 1, 2008’’ and inserting ‘‘January 1, 2010’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 313. QUALIFIED ZONE ACADEMY BONDS. 

(a) IN GENERAL.—Subpart I of part IV of 

subchapter A of chapter 1 is amended by adding at the end the following new section: 

‘‘SEC. 54E. QUALIFIED ZONE ACADEMY BONDS. 

‘‘(a) QUALIFIED ZONE ACADEMY BONDS.—For 

purposes of this subchapter, the term ‘qualified zone academy bond’ means any bond 

issued as part of an issue if— 

‘‘(1) 100 percent of the available project 

proceeds of such issue are to be used for a 

qualified purpose with respect to a qualified 

zone academy established by an eligible local 

education agency, 

‘‘(2) the bond is issued by a State or local 

government within the jurisdiction of which 

such academy is located, and 

‘‘(3) the issuer— 

‘‘(A) designates such bond for purposes of 

this section, 

‘‘(B) certifies that it has written assurances that the private business contribution 

requirement of subsection (b) will be met 

with respect to such academy, and 

‘‘(C) certifies that it has the written approval of the eligible local education agency 

for such bond issuance. 

‘‘(b) PRIVATE BUSINESS CONTRIBUTION REQUIREMENT.—For purposes of subsection (a), 

the private business contribution requirement of this subsection is met with respect 

to any issue if the eligible local education 

agency that established the qualified zone 

academy has written commitments from private entities to make qualified contributions 

having a present value (as of the date of 

issuance of the issue) of not less than 10 percent of the proceeds of the issue. 

‘‘(c) LIMITATION ON AMOUNT OF BONDS DESIGNATED.— 

‘‘(1) NATIONAL LIMITATION.—There is a national zone academy bond limitation for 

each calendar year. Such limitation is 

$400,000,000 for 2008 and 2009, and, except as 

provided in paragraph (4), zero thereafter. 

‘‘(2) ALLOCATION OF LIMITATION.—The national zone academy bond limitation for a 

calendar year shall be allocated by the Secretary among the States on the basis of their 

respective populations of individuals below 

the poverty line (as defined by the Office of 

Management and Budget). The limitation 

amount allocated to a State under the preceding sentence shall be allocated by the 

State education agency to qualified zone 

academies within such State. 

‘‘(3) DESIGNATION SUBJECT TO LIMITATION

AMOUNT.—The maximum aggregate face 

amount of bonds issued during any calendar 

year which may be designated under subsection (a) with respect to any qualified zone 

academy shall not exceed the limitation 

amount allocated to such academy under 

paragraph (2) for such calendar year. 

‘‘(4) CARRYOVER OF UNUSED LIMITATION.— 

‘‘(A) IN GENERAL.—If for any calendar 

year— 

‘‘(i) the limitation amount for any State, 

exceeds 

‘‘(ii) the amount of bonds issued during 

such year which are designated under subsection (a) with respect to qualified zone 

academies within such State, 

the limitation amount for such State for the 

following calendar year shall be increased by 

the amount of such excess. 

‘‘(B) LIMITATION ON CARRYOVER.—Any 

carryforward of a limitation amount may be 

carried only to the first 2 years following the 

unused limitation year. For purposes of the 

preceding sentence, a limitation amount 

shall be treated as used on a first-in first-out 

basis. 

‘‘(C) COORDINATION WITH SECTION 1397E.— 

Any carryover determined under section 

1397E(e)(4) (relating to carryover of unused 

limitation) with respect to any State to calendar year 2008 or 2009 shall be treated for 

purposes of this section as a carryover with 

respect to such State for such calendar year 

under subparagraph (A), and the limitation 

of subparagraph (B) shall apply to such carryover taking into account the calendar 

years to which such carryover relates. 

‘‘(d) DEFINITIONS.—For purposes of this section— 


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S10370 CONGRESSIONAL RECORD — SENATE October 1, 2008 

‘‘(1) QUALIFIED ZONE ACADEMY.—The term 

‘qualified zone academy’ means any public 

school (or academic program within a public 

school) which is established by and operated 

under the supervision of an eligible local 

education agency to provide education or 

training below the postsecondary level if— 

‘‘(A) such public school or program (as the 

case may be) is designed in cooperation with 

business to enhance the academic curriculum, increase graduation and employment rates, and better prepare students for 

the rigors of college and the increasingly 

complex workforce, 

‘‘(B) students in such public school or program (as the case may be) will be subject to 

the same academic standards and assessments as other students educated by the eligible local education agency, 

‘‘(C) the comprehensive education plan of 

such public school or program is approved by 

the eligible local education agency, and 

‘‘(D)(i) such public school is located in an 

empowerment zone or enterprise community 

(including any such zone or community designated after the date of the enactment of 

this section), or 

‘‘(ii) there is a reasonable expectation (as 

of the date of issuance of the bonds) that at 

least 35 percent of the students attending 

such school or participating in such program 

(as the case may be) will be eligible for free 

or reduced-cost lunches under the school 

lunch program established under the National School Lunch Act. 

‘‘(2) ELIGIBLE LOCAL EDUCATION AGENCY.— 

For purposes of this section, the term ‘eligible local education agency’ means any local 

educational agency as defined in section 9101 

of the Elementary and Secondary Education 

Act of 1965. 

‘‘(3) QUALIFIED PURPOSE.—The term ‘qualified purpose’ means, with respect to any 

qualified zone academy— 

‘‘(A) rehabilitating or repairing the public 

school facility in which the academy is established, 

‘‘(B) providing equipment for use at such 

academy, 

‘‘(C) developing course materials for education to be provided at such academy, and 

‘‘(D) training teachers and other school 

personnel in such academy. 

‘‘(4) QUALIFIED CONTRIBUTIONS.—The term 

‘qualified contribution’ means any contribution (of a type and quality acceptable to the 

eligible local education agency) of— 

‘‘(A) equipment for use in the qualified 

zone academy (including state-of-the-art 

technology and vocational equipment), 

‘‘(B) technical assistance in developing 

curriculum or in training teachers in order 

to promote appropriate market driven technology in the classroom, 

‘‘(C) services of employees as volunteer 

mentors, 

‘‘(D) internships, field trips, or other educational opportunities outside the academy 

for students, or 

‘‘(E) any other property or service specified 

by the eligible local education agency.’’. 

(b) CONFORMING AMENDMENTS.— 

(1) Paragraph (1) of section 54A(d), as 

amended by this Act, is amended by striking 

‘‘or’’ at the end of subparagraph (B), by inserting ‘‘or’’ at the end of subparagraph (C), 

and by inserting after subparagraph (C) the 

following new subparagraph: 

‘‘(D) a qualified zone academy bond,’’. 

(2) Subparagraph (C) of section 54A(d)(2), as 

amended by this Act, is amended by striking 

‘‘and’’ at the end of clause (ii), by striking 

the period at the end of clause (iii) and inserting ‘‘, and’’, and by adding at the end the 

following new clause: 

‘‘(iv) in the case of a qualified zone academy bond, a purpose specified in section 

54E(a)(1).’’. 

(3) Section 1397E is amended by adding at 

the end the following new subsection: 

‘‘(m) TERMINATION.—This section shall not 

apply to any obligation issued after the date 

of the enactment of the Tax Extenders and 

Alternative Minimum Tax Relief Act of 

2008.’’. 

(4) The table of sections for subpart I of 

part IV of subchapter A of chapter 1 is 

amended by adding at the end the following 

new item: 

‘‘Sec. 54E. Qualified zone academy bonds.’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to obligations issued after the date of the enactment 

of this Act. 

SEC. 314. INDIAN EMPLOYMENT CREDIT. 

(a) IN GENERAL.—Subsection (f) of section 

45A (relating to termination) is amended by 

striking ‘‘December 31, 2007’’ and inserting 

‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 315. ACCELERATED DEPRECIATION FOR 

BUSINESS PROPERTY ON INDIAN 

RESERVATIONS. 

(a) IN GENERAL.—Paragraph (8) of section 

168(j) (relating to termination) is amended 

by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to property 

placed in service after December 31, 2007. 

SEC. 316. RAILROAD TRACK MAINTENANCE. 

(a) IN GENERAL.—Subsection (f) of section 

45G (relating to application of section) is 

amended by striking ‘‘January 1, 2008’’ and 

inserting ‘‘January 1, 2010’’. 

(b) CREDIT ALLOWED AGAINST ALTERNATIVE

MINIMUM TAX.—Subparagraph (B) of section 

38(c)(4), as amended by this Act, is amended— 

(1) by redesignating clauses (v), (vi), and 

(vii) as clauses (vi), (vii), and (viii), respectively, and 

(2) by inserting after clause (iv) the following new clause: 

‘‘(v) the credit determined under section 

45G,’’. 

(c) EFFECTIVE DATES.— 

(1) The amendment made by subsection (a) 

shall apply to expenditures paid or incurred 

during taxable years beginning after December 31, 2007. 

(2) The amendments made by subsection 

(b) shall apply to credits determined under 

section 45G of the Internal Revenue Code of 

1986 in taxable years beginning after December 31, 2007, and to carrybacks of such credits. 

SEC. 317. SEVEN-YEAR COST RECOVERY PERIOD 

FOR MOTORSPORTS RACING TRACK 

FACILITY. 

(a) IN GENERAL.—Subparagraph (D) of section 168(i)(15) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to property 

placed in service after December 31, 2007. 

SEC. 318. EXPENSING OF ENVIRONMENTAL REMEDIATION COSTS. 

(a) IN GENERAL.—Subsection (h) of section 

198 (relating to termination) is amended by 

striking ‘‘December 31, 2007’’ and inserting 

‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to expenditures paid or incurred after December 31, 

2007. 

SEC. 319. EXTENSION OF WORK OPPORTUNITY 

TAX CREDIT FOR HURRICANE 

KATRINA EMPLOYEES. 

(a) IN GENERAL.—Paragraph (1) of section 

201(b) of the Katrina Emergency Tax Relief 

Act of 2005 is amended by striking ‘‘2-year’’ 

and inserting ‘‘4-year’’. 

(b) EFFECTIVE DATE.—The amendment 

made by subsection (a) shall apply to individuals hired after August 27, 2007. 

SEC. 320. EXTENSION OF INCREASED REHABILITATION CREDIT FOR STRUCTURES 

IN THE GULF OPPORTUNITY ZONE. 

(a) IN GENERAL.—Subsection (h) of section 

1400N is amended by striking ‘‘December 31, 

2008’’ and inserting ‘‘December 31, 2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to expenditures paid or incurred after the date of the 

enactment of this Act. 

SEC. 321. ENHANCED DEDUCTION FOR QUALIFIED COMPUTER CONTRIBUTIONS. 

(a) IN GENERAL.—Subparagraph (G) of section 170(e)(6) is amended by striking ‘‘December 31, 2007’’ and inserting ‘‘December 31, 

2009’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to contributions made during taxable years beginning 

after December 31, 2007. 

SEC. 322. TAX INCENTIVES FOR INVESTMENT IN 

THE DISTRICT OF COLUMBIA. 

(a) DESIGNATION OF ZONE.— 

(1) IN GENERAL.—Subsection (f) of section 

1400 is amended by striking ‘‘2007’’ both 

places it appears and inserting ‘‘2009’’. 

(2) EFFECTIVE DATE.—The amendments 

made by this subsection shall apply to periods beginning after December 31, 2007. 

(b) TAX-EXEMPT ECONOMIC DEVELOPMENT

BONDS.— 

(1) IN GENERAL.—Subsection (b) of section 

1400A is amended by striking ‘‘2007’’ and inserting ‘‘2009’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply to bonds 

issued after December 31, 2007. 

(c) ZERO PERCENT CAPITAL GAINS RATE.— 

(1) IN GENERAL.—Subsection (b) of section 

1400B is amended by striking ‘‘2008’’ each 

place it appears and inserting ‘‘2010’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Section 1400B(e)(2) is amended— 

(i) by striking ‘‘2012’’ and inserting ‘‘2014’’, 

and 

(ii) by striking ‘‘2012’’ in the heading thereof and inserting ‘‘2014’’. 

(B) Section 1400B(g)(2) is amended by striking ‘‘2012’’ and inserting ‘‘2014’’. 

(C) Section 1400F(d) is amended by striking 

‘‘2012’’ and inserting ‘‘2014’’. 

(3) EFFECTIVE DATES.— 

(A) EXTENSION.—The amendments made by 

paragraph (1) shall apply to acquisitions 

after December 31, 2007. 

(B) CONFORMING AMENDMENTS.—The amendments made by paragraph (2) shall take effect on the date of the enactment of this Act. 

(d) FIRST-TIME HOMEBUYER CREDIT.— 

(1) IN GENERAL.—Subsection (i) of section 

1400C is amended by striking ‘‘2008’’ and inserting ‘‘2010’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply to property purchased after December 31, 2007. 

SEC. 323. ENHANCED CHARITABLE DEDUCTIONS 

FOR CONTRIBUTIONS OF FOOD INVENTORY. 

(a) INCREASED AMOUNT OF DEDUCTION.— 

(1) IN GENERAL.—Clause (iv) of section 

170(e)(3)(C) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply to contributions made after December 31, 2007. 

(b) TEMPORARY SUSPENSION OF LIMITATIONS

ON CHARITABLE CONTRIBUTIONS.— 

(1) IN GENERAL.—Section 170(b) is amended 

by adding at the end the following new paragraph: 

‘‘(3) TEMPORARY SUSPENSION OF LIMITATIONS

ON CHARITABLE CONTRIBUTIONS.—In the case 

of a qualified farmer or rancher (as defined 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10371 

in paragraph (1)(E)(v)), any charitable contribution of food— 

‘‘(A) to which subsection (e)(3)(C) applies 

(without regard to clause (ii) thereof), and 

‘‘(B) which is made during the period beginning on the date of the enactment of this 

paragraph and before January 1, 2009, 

shall be treated for purposes of paragraph 

(1)(E) or (2)(B), whichever is applicable, as if 

it were a qualified conservation contribution 

which is made by a qualified farmer or 

rancher and which otherwise meets the requirements of such paragraph.’’. 

(2) EFFECTIVE DATE.—The amendment 

made by this subsection shall apply to taxable years ending after the date of the enactment of this Act. 

SEC. 324. EXTENSION OF ENHANCED CHARITABLE DEDUCTION FOR CONTRIBUTIONS OF BOOK INVENTORY. 

(a) EXTENSION.—Clause (iv) of section 

170(e)(3)(D) (relating to termination) is 

amended by striking ‘‘December 31, 2007’’ and 

inserting ‘‘December 31, 2009’’. 

(b) CLERICAL AMENDMENT.—Clause (iii) of 

section 170(e)(3)(D) (relating to certification 

by donee) is amended by inserting ‘‘of 

books’’ after ‘‘to any contribution’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to contributions made after December 31, 2007. 

SEC. 325. EXTENSION AND MODIFICATION OF 

DUTY SUSPENSION ON WOOL PRODUCTS; WOOL RESEARCH FUND; 

WOOL DUTY REFUNDS. 

(a) EXTENSION OF TEMPORARY DUTY REDUCTIONS.—Each of the following headings of the 

Harmonized Tariff Schedule of the United 

States is amended by striking the date in the 

effective period column and inserting ‘‘12/31/ 

2014’’: 

(1) Heading 9902.51.11 (relating to fabrics of 

worsted wool). 

(2) Heading 9902.51.13 (relating to yarn of 

combed wool). 

(3) Heading 9902.51.14 (relating to wool 

fiber, waste, garnetted stock, combed wool, 

or wool top). 

(4) Heading 9902.51.15 (relating to fabrics of 

combed wool). 

(5) Heading 9902.51.16 (relating to fabrics of 

combed wool). 

(b) EXTENSION OF DUTY REFUNDS AND WOOL

RESEARCH TRUST FUND.— 

(1) IN GENERAL.—Section 4002(c) of the 

Wool Suit and Textile Trade Extension Act 

of 2004 (Public Law 108–429; 118 Stat. 2603) is 

amended— 

(A) in paragraph (3)(C), by striking ‘‘2010’’ 

and inserting ‘‘2015’’; and 

(B) in paragraph (6)(A), by striking 

‘‘through 2009’’ and inserting ‘‘through 2014’’. 

(2) SUNSET.—Section 506(f) of the Trade and 

Development Act of 2000 (Public 106–200; 114 

Stat. 303 (7 U.S.C. 7101 note)) is amended by 

striking ‘‘2010’’ and inserting ‘‘2015’’. 

TITLE IV—EXTENSION OF TAX 

ADMINISTRATION PROVISIONS 

SEC. 401. PERMANENT AUTHORITY FOR UNDERCOVER OPERATIONS. 

(a) IN GENERAL.—Section 7608(c) (relating 

to rules relating to undercover operations) is 

amended by striking paragraph (6). 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to operations conducted after the date of the enactment of this Act. 

SEC. 402. PERMANENT AUTHORITY FOR DISCLOSURE OF INFORMATION RELATING 

TO TERRORIST ACTIVITIES. 

(a) DISCLOSURE OF RETURN INFORMATION TO

APPRISE APPROPRIATE OFFICIALS OF TERRORIST ACTIVITIES.—Subparagraph (C) of section 6103(i)(3) is amended by striking clause 

(iv). 

(b) DISCLOSURE UPON REQUEST OF INFORMATION RELATING TO TERRORIST ACTIVITIES.— 

Paragraph (7) of section 6103(i) is amended by 

striking subparagraph (E). 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to disclosures after the date of the enactment of this 

Act. 

TITLE V—ADDITIONAL TAX RELIEF AND 

OTHER TAX PROVISIONS 

Subtitle A—General Provisions 

SEC. 501. $8,500 INCOME THRESHOLD USED TO 

CALCULATE REFUNDABLE PORTION 

OF CHILD TAX CREDIT. 

(a) IN GENERAL.—Section 24(d) is amended 

by adding at the end the following new paragraph: 

‘‘(4) SPECIAL RULE FOR 2008.—Notwithstanding paragraph (3), in the case of any 

taxable year beginning in 2008, the dollar 

amount in effect for such taxable year under 

paragraph (1)(B)(i) shall be $8,500.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to taxable 

years beginning after December 31, 2007. 

SEC. 502. PROVISIONS RELATED TO FILM AND 

TELEVISION PRODUCTIONS. 

(a) EXTENSION OF EXPENSING RULES FOR

QUALIFIED FILM AND TELEVISION PRODUCTIONS.—Section 181(f) (relating to termination) is amended by striking ‘‘December 

31, 2008’’ and inserting ‘‘December 31, 2009’’. 

(b) MODIFICATION OF LIMITATION ON EXPENSING.—Subparagraph (A) of section 181(a)(2) is 

amended to read as follows: 

‘‘(A) IN GENERAL.—Paragraph (1) shall not 

apply to so much of the aggregate cost of 

any qualified film or television production as 

exceeds $15,000,000.’’. 

(c) MODIFICATIONS TO DEDUCTION FOR DOMESTIC ACTIVITIES.— 

(1) DETERMINATION OF W–2 WAGES.—Paragraph (2) of section 199(b) is amended by adding at the end the following new subparagraph: 

‘‘(D) SPECIAL RULE FOR QUALIFIED FILM.—In 

the case of a qualified film, such term shall 

include compensation for services performed 

in the United States by actors, production 

personnel, directors, and producers.’’. 

(2) DEFINITION OF QUALIFIED FILM.—Paragraph (6) of section 199(c) is amended by adding at the end the following: ‘‘A qualified 

film shall include any copyrights, trademarks, or other intangibles with respect to 

such film. The methods and means of distributing a qualified film shall not affect the 

availability of the deduction under this section.’’. 

(3) PARTNERSHIPS.—Subparagraph (A) of 

section 199(d)(1) is amended by striking 

‘‘and’’ at the end of clause (ii), by striking 

the period at the end of clause (iii) and inserting ‘‘, and’’, and by adding at the end the 

following new clause: 

‘‘(iv) in the case of each partner of a partnership, or shareholder of an S corporation, 

who owns (directly or indirectly) at least 20 

percent of the capital interests in such partnership or of the stock of such S corporation— 

‘‘(I) such partner or shareholder shall be 

treated as having engaged directly in any 

film produced by such partnership or S corporation, and 

‘‘(II) such partnership or S corporation 

shall be treated as having engaged directly 

in any film produced by such partner or 

shareholder.’’. 

(d) CONFORMING AMENDMENT.—Section 

181(d)(3)(A) is amended by striking ‘‘actors’’ 

and all that follows and inserting ‘‘actors, 

production personnel, directors, and producers.’’. 

(e) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall apply to qualified 

film and television productions commencing 

after December 31, 2007. 

(2) DEDUCTION.—The amendments made by 

subsection (c) shall apply to taxable years 

beginning after December 31, 2007. 

SEC. 503. EXEMPTION FROM EXCISE TAX FOR 

CERTAIN WOODEN ARROWS DESIGNED FOR USE BY CHILDREN. 

(a) IN GENERAL.—Paragraph (2) of section 

4161(b) is amended by redesignating subparagraph (B) as subparagraph (C) and by inserting after subparagraph (A) the following new 

subparagraph: 

‘‘(B) EXEMPTION FOR CERTAIN WOODEN

ARROW SHAFTS.—Subparagraph (A) shall not 

apply to any shaft consisting of all natural 

wood with no laminations or artificial means 

of enhancing the spine of such shaft (whether 

sold separately or incorporated as part of a 

finished or unfinished product) of a type used 

in the manufacture of any arrow which after 

its assembly— 

‘‘(i) measures 5⁄16 of an inch or less in diameter, and 

‘‘(ii) is not suitable for use with a bow described in paragraph (1)(A).’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to shafts 

first sold after the date of enactment of this 

Act. 

SEC. 504. INCOME AVERAGING FOR AMOUNTS RECEIVED IN CONNECTION WITH THE 

EXXON VALDEZ LITIGATION. 

(a) INCOME AVERAGING OF AMOUNTS RECEIVED FROM THE EXXON VALDEZ LITIGATION.—For purposes of section 1301 of the Internal Revenue Code of 1986— 

(1) any qualified taxpayer who receives any 

qualified settlement income in any taxable 

year shall be treated as engaged in a fishing 

business (determined without regard to the 

commercial nature of the business), and 

(2) such qualified settlement income shall 

be treated as income attributable to such a 

fishing business for such taxable year. 

(b) CONTRIBUTIONS OF AMOUNTS RECEIVED

TO RETIREMENT ACCOUNTS.— 

(1) IN GENERAL.—Any qualified taxpayer 

who receives qualified settlement income 

during the taxable year may, at any time before the end of the taxable year in which 

such income was received, make one or more 

contributions to an eligible retirement plan 

of which such qualified taxpayer is a beneficiary in an aggregate amount not to exceed 

the lesser of— 

(A) $100,000 (reduced by the amount of 

qualified settlement income contributed to 

an eligible retirement plan in prior taxable 

years pursuant to this subsection), or 

(B) the amount of qualified settlement income received by the individual during the 

taxable year. 

(2) TIME WHEN CONTRIBUTIONS DEEMED

MADE.—For purposes of paragraph (1), a 

qualified taxpayer shall be deemed to have 

made a contribution to an eligible retirement plan on the last day of the taxable year 

in which such income is received if the contribution is made on account of such taxable 

year and is made not later than the time prescribed by law for filing the return for such 

taxable year (not including extensions thereof). 

(3) TREATMENT OF CONTRIBUTIONS TO ELIGIBLE RETIREMENT PLANS.—For purposes of the 

Internal Revenue Code of 1986, if a contribution is made pursuant to paragraph (1) with 

respect to qualified settlement income, 

then— 

(A) except as provided in paragraph (4)— 

(i) to the extent of such contribution, the 

qualified settlement income shall not be included in taxable income, and 

(ii) for purposes of section 72 of such Code, 

such contribution shall not be considered to 

be investment in the contract, 

(B) the qualified taxpayer shall, to the extent of the amount of the contribution, be 

treated— 


smartinez on PROD1PC64 with SENATE
S10372 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(i) as having received the qualified settlement income— 

(I) in the case of a contribution to an individual retirement plan (as defined under section 7701(a)(37) of such Code), in a distribution described in section 408(d)(3) of such 

Code, and 

(II) in the case of any other eligible retirement plan, in an eligible rollover distribution (as defined under section 402(f)(2) of such 

Code), and 

(ii) as having transferred the amount to 

the eligible retirement plan in a direct trustee to trustee transfer within 60 days of the 

distribution, 

(C) section 408(d)(3)(B) of the Internal Revenue Code of 1986 shall not apply with respect to amounts treated as a rollover under 

this paragraph, and 

(D) section 408A(c)(3)(B) of the Internal 

Revenue Code of 1986 shall not apply with respect to amounts contributed to a Roth IRA 

(as defined under section 408A(b) of such 

Code) or a designated Roth contribution to 

an applicable retirement plan (within the 

meaning of section 402A of such Code) under 

this paragraph. 

(4) SPECIAL RULE FOR ROTH IRAS AND ROTH

401(k)S.—For purposes of the Internal Revenue Code of 1986, if a contribution is made 

pursuant to paragraph (1) with respect to 

qualified settlement income to a Roth IRA 

(as defined under section 408A(b) of such 

Code) or as a designated Roth contribution 

to an applicable retirement plan (within the 

meaning of section 402A of such Code), 

then— 

(A) the qualified settlement income shall 

be includible in taxable income, and 

(B) for purposes of section 72 of such Code, 

such contribution shall be considered to be 

investment in the contract. 

(5) ELIGIBLE RETIREMENT PLAN.—For purpose of this subsection, the term ‘‘eligible retirement plan’’ has the meaning given such 

term under section 402(c)(8)(B) of the Internal Revenue Code of 1986. 

(c) TREATMENT OF QUALIFIED SETTLEMENT

INCOME UNDER EMPLOYMENT TAXES.— 

(1) SECA.—For purposes of chapter 2 of the 

Internal Revenue Code of 1986 and section 211 

of the Social Security Act, no portion of 

qualified settlement income received by a 

qualified taxpayer shall be treated as selfemployment income. 

(2) FICA.—For purposes of chapter 21 of the 

Internal Revenue Code of 1986 and section 209 

of the Social Security Act, no portion of 

qualified settlement income received by a 

qualified taxpayer shall be treated as wages. 

(d) QUALIFIED TAXPAYER.—For purposes of 

this section, the term ‘‘qualified taxpayer’’ 

means— 

(1) any individual who is a plaintiff in the 

civil action In re Exxon Valdez, No. 89–095–CV 

(HRH) (Consolidated) (D. Alaska); or 

(2) any individual who is a beneficiary of 

the estate of such a plaintiff who— 

(A) acquired the right to receive qualified 

settlement income from that plaintiff; and 

(B) was the spouse or an immediate relative of that plaintiff. 

(e) QUALIFIED SETTLEMENT INCOME.—For 

purposes of this section, the term ‘‘qualified 

settlement income’’ means any interest and 

punitive damage awards which are— 

(1) otherwise includible in taxable income, 

and 

(2) received (whether as lump sums or periodic payments) in connection with the civil 

action In re Exxon Valdez, No. 89–095–CV 

(HRH) (Consolidated) (D. Alaska) (whether 

pre- or post-judgment and whether related to 

a settlement or judgment). 

SEC. 505. CERTAIN FARMING BUSINESS MACHINERY AND EQUIPMENT TREATED AS 5- 

YEAR PROPERTY. 

(a) IN GENERAL.—Section 168(e)(3)(B) (defining 5-year property) is amended by striking ‘‘and’’ at the end of clause (v), by striking the period at the end of clause (vi)(III) 

and inserting ‘‘, and’’, and by inserting after 

clause (vi) the following new clause: 

‘‘(vii) any machinery or equipment (other 

than any grain bin, cotton ginning asset, 

fence, or other land improvement) which is 

used in a farming business (as defined in section 263A(e)(4)), the original use of which 

commences with the taxpayer after December 31, 2008, and which is placed in service before January 1, 2010.’’. 

(b) ALTERNATIVE SYSTEM.—The table contained in section 168(g)(3)(B) (relating to special rule for certain property assigned to 

classes) is amended by inserting after the 

item relating to subparagraph (B)(iii) the 

following: 

(B)(vii) ......................................... 10’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to property 

placed in service after December 31, 2008. 

SEC. 506. MODIFICATION OF PENALTY ON UNDERSTATEMENT OF TAXPAYER’S LIABILITY BY TAX RETURN PREPARER. 

(a) IN GENERAL.—Subsection (a) of section 

6694 is amended to read as follows: 

‘‘(a) UNDERSTATEMENT DUE TO UNREASONABLE POSITIONS.— 

‘‘(1) IN GENERAL.—If a tax return preparer— 

‘‘(A) prepares any return or claim of refund 

with respect to which any part of an understatement of liability is due to a position described in paragraph (2), and 

‘‘(B) knew (or reasonably should have 

known) of the position, 

such tax return preparer shall pay a penalty 

with respect to each such return or claim in 

an amount equal to the greater of $1,000 or 50 

percent of the income derived (or to be derived) by the tax return preparer with respect to the return or claim. 

‘‘(2) UNREASONABLE POSITION.— 

‘‘(A) IN GENERAL.—Except as otherwise provided in this paragraph, a position is described in this paragraph unless there is or 

was substantial authority for the position. 

‘‘(B) DISCLOSED POSITIONS.—If the position 

was disclosed as provided in section 

6662(d)(2)(B)(ii)(I) and is not a position to 

which subparagraph (C) applies, the position 

is described in this paragraph unless there is 

a reasonable basis for the position. 

‘‘(C) TAX SHELTERS AND REPORTABLE TRANSACTIONS.—If the position is with respect to a 

tax shelter (as defined in section 

6662(d)(2)(C)(ii)) or a reportable transaction 

to which section 6662A applies, the position 

is described in this paragraph unless it is 

reasonable to believe that the position would 

more likely than not be sustained on its 

merits. 

‘‘(3) REASONABLE CAUSE EXCEPTION.—No 

penalty shall be imposed under this subsection if it is shown that there is reasonable 

cause for the understatement and the tax return preparer acted in good faith.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply— 

(1) in the case of a position other than a 

position described in subparagraph (C) of section 6694(a)(2) of the Internal Revenue Code 

of 1986 (as amended by this section), to returns prepared after May 25, 2007, and 

(2) in the case of a position described in 

such subparagraph (C), to returns prepared 

for taxable years ending after the date of the 

enactment of this Act. 

Subtitle B—Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 

SEC. 511. SHORT TITLE. 

This subtitle may be cited as the ‘‘Paul 

Wellstone and Pete Domenici Mental Health 

Parity and Addiction Equity Act of 2008’’. 

SEC. 512. MENTAL HEALTH PARITY. 

(a) AMENDMENTS TO ERISA.—Section 712 of 

the Employee Retirement Income Security 

Act of 1974 (29 U.S.C. 1185a) is amended— 

(1) in subsection (a), by adding at the end 

the following: 

‘‘(3) FINANCIAL REQUIREMENTS AND TREATMENT LIMITATIONS.— 

‘‘(A) IN GENERAL.—In the case of a group 

health plan (or health insurance coverage offered in connection with such a plan) that 

provides both medical and surgical benefits 

and mental health or substance use disorder 

benefits, such plan or coverage shall ensure 

that— 

‘‘(i) the financial requirements applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan (or coverage), and there are no separate cost sharing requirements that are applicable only 

with respect to mental health or substance 

use disorder benefits; and 

‘‘(ii) the treatment limitations applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant treatment limitations applied to substantially all medical and surgical benefits covered by the plan (or coverage) and there are no separate treatment 

limitations that are applicable only with respect to mental health or substance use disorder benefits. 

‘‘(B) DEFINITIONS.—In this paragraph: 

‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial requirement’ includes deductibles, 

copayments, coinsurance, and out-of-pocket 

expenses, but excludes an aggregate lifetime 

limit and an annual limit subject to paragraphs (1) and (2), 

‘‘(ii) PREDOMINANT.—A financial requirement or treatment limit is considered to be 

predominant if it is the most common or frequent of such type of limit or requirement. 

‘‘(iii) TREATMENT LIMITATION.—The term 

‘treatment limitation’ includes limits on the 

frequency of treatment, number of visits, 

days of coverage, or other similar limits on 

the scope or duration of treatment. 

‘‘(4) AVAILABILITY OF PLAN INFORMATION.— 

The criteria for medical necessity determinations made under the plan with respect 

to mental health or substance use disorder 

benefits (or the health insurance coverage 

offered in connection with the plan with respect to such benefits) shall be made available by the plan administrator (or the health 

insurance issuer offering such coverage) in 

accordance with regulations to any current 

or potential participant, beneficiary, or contracting provider upon request. The reason 

for any denial under the plan (or coverage) of 

reimbursement or payment for services with 

respect to mental health or substance use 

disorder benefits in the case of any participant or beneficiary shall, on request or as 

otherwise required, be made available by the 

plan administrator (or the health insurance 

issuer offering such coverage) to the participant or beneficiary in accordance with regulations. 

‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the 

case of a plan or coverage that provides both 

medical and surgical benefits and mental 

health or substance use disorder benefits, if 

the plan or coverage provides coverage for 

medical or surgical benefits provided by outof-network providers, the plan or coverage 


smartinez on PROD1PC64 with SENATE
October 1, 2008 CONGRESSIONAL RECORD — SENATE S10373 

shall provide coverage for mental health or 

substance use disorder benefits provided by 

out-of-network providers in a manner that is 

consistent with the requirements of this section.’’; 

(2) in subsection (b), by amending paragraph (2) to read as follows: 

‘‘(2) in the case of a group health plan (or 

health insurance coverage offered in connection with such a plan) that provides mental 

health or substance use disorder benefits, as 

affecting the terms and conditions of the 

plan or coverage relating to such benefits 

under the plan or coverage, except as provided in subsection (a).’’; 

(3) in subsection (c)— 

(A) in paragraph (1)(B)— 

(i) by inserting ‘‘(or 1 in the case of an employer residing in a State that permits small 

groups to include a single individual)’’ after 

‘‘at least 2’’ the first place that such appears; 

and 

(ii) by striking ‘‘and who employs at least 

2 employees on the first day of the plan 

year’’; and 

(B) by striking paragraph (2) and inserting 

the following: 

‘‘(2) COST EXEMPTION.— 

‘‘(A) IN GENERAL.—With respect to a group 

health plan (or health insurance coverage offered in connection with such a plan), if the 

application of this section to such plan (or 

coverage) results in an increase for the plan 

year involved of the actual total costs of 

coverage with respect to medical and surgical benefits and mental health and substance use disorder benefits under the plan 

(as determined and certified under subparagraph (C)) by an amount that exceeds the applicable percentage described in subparagraph (B) of the actual total plan costs, the 

provisions of this section shall not apply to 

such plan (or coverage) during the following 

plan year, and such exemption shall apply to 

the plan (or coverage) for 1 plan year. An employer may elect to continue to apply mental health and substance use disorder parity 

pursuant to this section with respect to the 

group health plan (or coverage) involved regardless of any increase in total costs. 

‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan (or coverage), the applicable 

percentage described in this subparagraph 

shall be— 

‘‘(i) 2 percent in the case of the first plan 

year in which this section is applied; and 

‘‘(ii) 1 percent in the case of each subsequent plan year. 

‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations as to increases in actual costs 

under a plan (or coverage) for purposes of 

this section shall be made and certified by a 

qualified and licensed actuary who is a member in good standing of the American Academy of Actuaries. All such determinations 

shall be in a written report prepared by the 

actuary. The report, and all underlying documentation relied upon by the actuary, shall 

be maintained by the group health plan or 

health insurance issuer for a period of 6 

years following the notification made under 

subparagraph (E). 

‘‘(D) 6-MONTH DETERMINATIONS.—If a group 

health plan (or a health insurance issuer offering coverage in connection with a group 

health plan) seeks an exemption under this 

paragraph, determinations under subparagraph (A) shall be made after such plan (or 

coverage) has complied with this section for 

the first 6 months of the plan year involved. 

‘‘(E) NOTIFICATION.— 

‘‘(i) IN GENERAL.—A group health plan (or a 

health insurance issuer offering coverage in 

connection with a group health plan) that, 

based upon a certification described under 

subparagraph (C), qualifies for an exemption 

under this paragraph, and elects to implement the exemption, shall promptly notify 

the Secretary, the appropriate State agencies, and participants and beneficiaries in 

the plan of such election. 

‘‘(ii) REQUIREMENT.—A notification to the 

Secretary under clause (i) shall include— 

‘‘(I) a description of the number of covered 

lives under the plan (or coverage) involved at 

the time of the notification, and as applicable, at the time of any prior election of the 

cost-exemption under this paragraph by such 

plan (or coverage); 

‘‘(II) for both the plan year upon which a 

cost exemption is sought and the year prior, 

a description of the actual total costs of coverage with respect to medical and surgical 

benefits and mental health and substance 

use disorder benefits under the plan; and 

‘‘(III) for both the plan year upon which a 

cost exemption is sought and the year prior, 

the actual total costs of coverage with respect to mental health and substance use 

disorder benefits under the plan. 

‘‘(iii) CONFIDENTIALITY.—A notification to 

the Secretary under clause (i) shall be confidential. The Secretary shall make available, upon request and on not more than an 

annual basis, an anonymous itemization of 

such notifications, that includes— 

‘‘(I) a breakdown of States by the size and 

type of employers submitting such notification; and 

‘‘(II) a summary of the data received under 

clause (ii). 

‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To 

determine compliance with this paragraph, 

the Secretary may audit the books and 

records of a group health plan or health insurance issuer relating to an exemption, including any actuarial reports prepared pursuant to subparagraph (C), during the 6 year 

period following the notification of such exemption under subparagraph (E). A State 

agency receiving a notification under subparagraph (E) may also conduct such an 

audit with respect to an exemption covered 

by such notification.’’; 

(4) in subsection (e), by striking paragraph 

(4) and inserting the following: 

‘‘(4) MENTAL HEALTH BENEFITS.—The term 

‘mental health benefits’ means benefits with 

respect to services for mental health conditions, as defined under the terms of the plan 

and in accordance with applicable Federal 

and State law. 

‘‘(5) SUBSTANCE USE DISORDER BENEFITS.— 

The term ‘substance use disorder benefits’ 

means benefits with respect to services for 

substance use disorders, as defined under the 

terms of the plan and in accordance with applicable Federal and State law.’’; 

(5) by striking subsection (f); 

(6) by inserting after subsection (e) the following: 

‘‘(f) SECRETARY REPORT.—The Secretary 

shall, by January 1, 2012, and every two years 

thereafter, submit to the appropriate committees of Congress a report on compliance 

of group health plans (and health insurance 

coverage offered in connection with such 

plans) with the requirements of this section. 

Such report shall include the results of any 

surveys or audits on compliance of group 

health plans (and health insurance coverage 

offered in connection with such plans) with 

such requirements and an analysis of the 

reasons for any failures to comply. 

‘‘(g) NOTICE AND ASSISTANCE.—The Secretary, in cooperation with the Secretaries 

of Health and Human Services and Treasury, 

as appropriate, shall publish and widely disseminate guidance and information for group 

health plans, participants and beneficiaries, 

applicable State and local regulatory bodies, 

and the National Association of Insurance 

Commissioners concerning the requirements 

of this section and shall provide assistance 

concerning such requirements and the continued operation of applicable State law. 

Such guidance and information shall inform 

participants and beneficiaries of how they 

may obtain assistance under this section, including, where appropriate, assistance from 

State consumer and insurance agencies.’’; 

(7) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health and substance 

use disorder benefits’’ each place it appears 

in subsections (a)(1)(B)(i), (a)(1)(C), 

(a)(2)(B)(i), and (a)(2)(C); and 

(8) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health or substance 

use disorder benefits’’ each place it appears 

(other than in any provision amended by the 

previous paragraph). 

(b) AMENDMENTS TO PUBLIC HEALTH SERVICE ACT.—Section 2705 of the Public Health 

Service Act (42 U.S.C. 300gg–5) is amended— 

(1) in subsection (a), by adding at the end 

the following: 

‘‘(3) FINANCIAL REQUIREMENTS AND TREATMENT LIMITATIONS.— 

‘‘(A) IN GENERAL.—In the case of a group 

health plan (or health insurance coverage offered in connection with such a plan) that 

provides both medical and surgical benefits 

and mental health or substance use disorder 

benefits, such plan or coverage shall ensure 

that— 

‘‘(i) the financial requirements applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan (or coverage), and there are no separate cost sharing requirements that are applicable only 

with respect to mental health or substance 

use disorder benefits; and 

‘‘(ii) the treatment limitations applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant treatment limitations applied to substantially all medical and surgical benefits covered by the plan (or coverage) and there are no separate treatment 

limitations that are applicable only with respect to mental health or substance use disorder benefits. 

‘‘(B) DEFINITIONS.—In this paragraph: 

‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial requirement’ includes deductibles, 

copayments, coinsurance, and out-of-pocket 

expenses, but excludes an aggregate lifetime 

limit and an annual limit subject to paragraphs (1) and (2). 

‘‘(ii) PREDOMINANT.—A financial requirement or treatment limit is considered to be 

predominant if it is the most common or frequent of such type of limit or requirement. 

‘‘(iii) TREATMENT LIMITATION.—The term 

‘treatment limitation’ includes limits on the 

frequency of treatment, number of visits, 

days of coverage, or other similar limits on 

the scope or duration of treatment. 

‘‘(4) AVAILABILITY OF PLAN INFORMATION.— 

The criteria for medical necessity determinations made under the plan with respect 

to mental health or substance use disorder 

benefits (or the health insurance coverage 

offered in connection with the plan with respect to such benefits) shall be made available by the plan administrator (or the health 

insurance issuer offering such coverage) in 

accordance with regulations to any current 

or potential participant, beneficiary, or contracting provider upon request. The reason 

for any denial under the plan (or coverage) of 

reimbursement or payment for services with 

respect to mental health or substance use 

disorder benefits in the case of any participant or beneficiary shall, on request or as 

otherwise required, be made available by the 

plan administrator (or the health insurance 

issuer offering such coverage) to the participant or beneficiary in accordance with regulations. 


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S10374 CONGRESSIONAL RECORD — SENATE October 1, 2008 

‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the 

case of a plan or coverage that provides both 

medical and surgical benefits and mental 

health or substance use disorder benefits, if 

the plan or coverage provides coverage for 

medical or surgical benefits provided by outof-network providers, the plan or coverage 

shall provide coverage for mental health or 

substance use disorder benefits provided by 

out-of-network providers in a manner that is 

consistent with the requirements of this section.’’; 

(2) in subsection (b), by amending paragraph (2) to read as follows: 

‘‘(2) in the case of a group health plan (or 

health insurance coverage offered in connection with such a plan) that provides mental 

health or substance use disorder benefits, as 

affecting the terms and conditions of the 

plan or coverage relating to such benefits 

under the plan or coverage, except as provided in subsection (a).’’; 

(3) in subsection (c)— 

(A) in paragraph (1), by inserting before 

the period the following: ‘‘(as defined in section 2791(e)(4), except that for purposes of 

this paragraph such term shall include employers with 1 employee in the case of an employer residing in a State that permits small 

groups to include a single individual)’’; and 

(B) by striking paragraph (2) and inserting 

the following: 

‘‘(2) COST EXEMPTION.— 

‘‘(A) IN GENERAL.—With respect to a group 

health plan (or health insurance coverage offered in connection with such a plan), if the 

application of this section to such plan (or 

coverage) results in an increase for the plan 

year involved of the actual total costs of 

coverage with respect to medical and surgical benefits and mental health and substance use disorder benefits under the plan 

(as determined and certified under subparagraph (C)) by an amount that exceeds the applicable percentage described in subparagraph (B) of the actual total plan costs, the 

provisions of this section shall not apply to 

such plan (or coverage) during the following 

plan year, and such exemption shall apply to 

the plan (or coverage) for 1 plan year. An employer may elect to continue to apply mental health and substance use disorder parity 

pursuant to this section with respect to the 

group health plan (or coverage) involved regardless of any increase in total costs. 

‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan (or coverage), the applicable 

percentage described in this subparagraph 

shall be— 

‘‘(i) 2 percent in the case of the first plan 

year in which this section is applied; and 

‘‘(ii) 1 percent in the case of each subsequent plan year. 

‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations as to increases in actual costs 

under a plan (or coverage) for purposes of 

this section shall be made and certified by a 

qualified and licensed actuary who is a member in good standing of the American Academy of Actuaries. All such determinations 

shall be in a written report prepared by the 

actuary. The report, and all underlying documentation relied upon by the actuary, shall 

be maintained by the group health plan or 

health insurance issuer for a period of 6 

years following the notification made under 

subparagraph (E). 

‘‘(D) 6-MONTH DETERMINATIONS.—If a group 

health plan (or a health insurance issuer offering coverage in connection with a group 

health plan) seeks an exemption under this 

paragraph, determinations under subparagraph (A) shall be made after such plan (or 

coverage) has complied with this section for 

the first 6 months of the plan year involved. 

‘‘(E) NOTIFICATION.— 

‘‘(i) IN GENERAL.—A group health plan (or a 

health insurance issuer offering coverage in 

connection with a group health plan) that, 

based upon a certification described under 

subparagraph (C), qualifies for an exemption 

under this paragraph, and elects to implement the exemption, shall promptly notify 

the Secretary, the appropriate State agencies, and participants and beneficiaries in 

the plan of such election. 

‘‘(ii) REQUIREMENT.—A notification to the 

Secretary under clause (i) shall include— 

‘‘(I) a description of the number of covered 

lives under the plan (or coverage) involved at 

the time of the notification, and as applicable, at the time of any prior election of the 

cost-exemption under this paragraph by such 

plan (or coverage); 

‘‘(II) for both the plan year upon which a 

cost exemption is sought and the year prior, 

a description of the actual total costs of coverage with respect to medical and surgical 

benefits and mental health and substance 

use disorder benefits under the plan; and 

‘‘(III) for both the plan year upon which a 

cost exemption is sought and the year prior, 

the actual total costs of coverage with respect to mental health and substance use 

disorder benefits under the plan. 

‘‘(iii) CONFIDENTIALITY.—A notification to 

the Secretary under clause (i) shall be confidential. The Secretary shall make available, upon request and on not more than an 

annual basis, an anonymous itemization of 

such notifications, that includes— 

‘‘(I) a breakdown of States by the size and 

type of employers submitting such notification; and 

‘‘(II) a summary of the data received under 

clause (ii). 

‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To 

determine compliance with this paragraph, 

the Secretary may audit the books and 

records of a group health plan or health insurance issuer relating to an exemption, including any actuarial reports prepared pursuant to subparagraph (C), during the 6 year 

period following the notification of such exemption under subparagraph (E). A State 

agency receiving a notification under subparagraph (E) may also conduct such an 

audit with respect to an exemption covered 

by such notification.’’; 

(4) in subsection (e), by striking paragraph 

(4) and inserting the following: 

‘‘(4) MENTAL HEALTH BENEFITS.—The term 

‘mental health benefits’ means benefits with 

respect to services for mental health conditions, as defined under the terms of the plan 

and in accordance with applicable Federal 

and State law. 

‘‘(5) SUBSTANCE USE DISORDER BENEFITS.— 

The term ‘substance use disorder benefits’ 

means benefits with respect to services for 

substance use disorders, as defined under the 

terms of the plan and in accordance with applicable Federal and State law.’’; 

(5) by striking subsection (f); 

(6) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health and substance 

use disorder benefits’’ each place it appears 

in subsections (a)(1)(B)(i), (a)(1)(C), 

(a)(2)(B)(i), and (a)(2)(C); and 

(7) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health or substance 

use disorder benefits’’ each place it appears 

(other than in any provision amended by the 

previous paragraph). 

(c) AMENDMENTS TO INTERNAL REVENUE

CODE.—Section 9812 of the Internal Revenue 

Code of 1986 is amended— 

(1) in subsection (a), by adding at the end 

the following: 

‘‘(3) FINANCIAL REQUIREMENTS AND TREATMENT LIMITATIONS.— 

‘‘(A) IN GENERAL.—In the case of a group 

health plan that provides both medical and 

surgical benefits and mental health or substance use disorder benefits, such plan shall 

ensure that— 

‘‘(i) the financial requirements applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant financial requirements applied to substantially all medical and surgical benefits covered by the plan, and there 

are no separate cost sharing requirements 

that are applicable only with respect to mental health or substance use disorder benefits; 

and 

‘‘(ii) the treatment limitations applicable 

to such mental health or substance use disorder benefits are no more restrictive than 

the predominant treatment limitations applied to substantially all medical and surgical benefits covered by the plan and there 

are no separate treatment limitations that 

are applicable only with respect to mental 

health or substance use disorder benefits. 

‘‘(B) DEFINITIONS.—In this paragraph: 

‘‘(i) FINANCIAL REQUIREMENT.—The term ‘financial requirement’ includes deductibles, 

copayments, coinsurance, and out-of-pocket 

expenses, but excludes an aggregate lifetime 

limit and an annual limit subject to paragraphs (1) and (2), 

‘‘(ii) PREDOMINANT.—A financial requirement or treatment limit is considered to be 

predominant if it is the most common or frequent of such type of limit or requirement. 

‘‘(iii) TREATMENT LIMITATION.—The term 

‘treatment limitation’ includes limits on the 

frequency of treatment, number of visits, 

days of coverage, or other similar limits on 

the scope or duration of treatment. 

‘‘(4) AVAILABILITY OF PLAN INFORMATION.— 

The criteria for medical necessity determinations made under the plan with respect 

to mental health or substance use disorder 

benefits shall be made available by the plan 

administrator in accordance with regulations to any current or potential participant, 

beneficiary, or contracting provider upon request. The reason for any denial under the 

plan of reimbursement or payment for services with respect to mental health or substance use disorder benefits in the case of 

any participant or beneficiary shall, on request or as otherwise required, be made 

available by the plan administrator to the 

participant or beneficiary in accordance 

with regulations. 

‘‘(5) OUT-OF-NETWORK PROVIDERS.—In the 

case of a plan that provides both medical and 

surgical benefits and mental health or substance use disorder benefits, if the plan provides coverage for medical or surgical benefits provided by out-of-network providers, 

the plan shall provide coverage for mental 

health or substance use disorder benefits 

provided by out-of-network providers in a 

manner that is consistent with the requirements of this section.’’; 

(2) in subsection (b), by amending paragraph (2) to read as follows: 

‘‘(2) in the case of a group health plan that 

provides mental health or substance use disorder benefits, as affecting the terms and 

conditions of the plan relating to such benefits under the plan, except as provided in 

subsection (a).’’; 

(3) in subsection (c)— 

(A) by amending paragraph (1) to read as 

follows: 

‘‘(1) SMALL EMPLOYER EXEMPTION.— 

‘‘(A) IN GENERAL.—This section shall not 

apply to any group health plan for any plan 

year of a small employer. 

‘‘(B) SMALL EMPLOYER.—For purposes of 

subparagraph (A), the term ‘small employer’ 

means, with respect to a calendar year and a 

plan year, an employer who employed an average of at least 2 (or 1 in the case of an employer residing in a State that permits small 

groups to include a single individual) but not 

more than 50 employees on business days 

during the preceding calendar year. For purposes of the preceding sentence, all persons 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10375 

treated as a single employer under subsection (b), (c), (m), or (o) of section 414 shall 

be treated as 1 employer and rules similar to 

rules of subparagraphs (B) and (C) of section 

4980D(d)(2) shall apply.’’; and 

(B) by striking paragraph (2) and inserting 

the following: 

‘‘(2) COST EXEMPTION.— 

‘‘(A) IN GENERAL.—With respect to a group 

health plan, if the application of this section 

to such plan results in an increase for the 

plan year involved of the actual total costs 

of coverage with respect to medical and surgical benefits and mental health and substance use disorder benefits under the plan 

(as determined and certified under subparagraph (C)) by an amount that exceeds the applicable percentage described in subparagraph (B) of the actual total plan costs, the 

provisions of this section shall not apply to 

such plan during the following plan year, and 

such exemption shall apply to the plan for 1 

plan year. An employer may elect to continue to apply mental health and substance 

use disorder parity pursuant to this section 

with respect to the group health plan involved regardless of any increase in total 

costs. 

‘‘(B) APPLICABLE PERCENTAGE.—With respect to a plan, the applicable percentage described in this subparagraph shall be— 

‘‘(i) 2 percent in the case of the first plan 

year in which this section is applied; and 

‘‘(ii) 1 percent in the case of each subsequent plan year. 

‘‘(C) DETERMINATIONS BY ACTUARIES.—Determinations as to increases in actual costs 

under a plan for purposes of this section 

shall be made and certified by a qualified 

and licensed actuary who is a member in 

good standing of the American Academy of 

Actuaries. All such determinations shall be 

in a written report prepared by the actuary. 

The report, and all underlying documentation relied upon by the actuary, shall be 

maintained by the group health plan for a 

period of 6 years following the notification 

made under subparagraph (E). 

‘‘(D) 6-MONTH DETERMINATIONS.—If a group 

health plan seeks an exemption under this 

paragraph, determinations under subparagraph (A) shall be made after such plan has 

complied with this section for the first 6 

months of the plan year involved. 

‘‘(E) NOTIFICATION.— 

‘‘(i) IN GENERAL.—A group health plan that, 

based upon a certification described under 

subparagraph (C), qualifies for an exemption 

under this paragraph, and elects to implement the exemption, shall promptly notify 

the Secretary, the appropriate State agencies, and participants and beneficiaries in 

the plan of such election. 

‘‘(ii) REQUIREMENT.—A notification to the 

Secretary under clause (i) shall include— 

‘‘(I) a description of the number of covered 

lives under the plan involved at the time of 

the notification, and as applicable, at the 

time of any prior election of the cost-exemption under this paragraph by such plan; 

‘‘(II) for both the plan year upon which a 

cost exemption is sought and the year prior, 

a description of the actual total costs of coverage with respect to medical and surgical 

benefits and mental health and substance 

use disorder benefits under the plan; and 

‘‘(III) for both the plan year upon which a 

cost exemption is sought and the year prior, 

the actual total costs of coverage with respect to mental health and substance use 

disorder benefits under the plan. 

‘‘(iii) CONFIDENTIALITY.—A notification to 

the Secretary under clause (i) shall be confidential. The Secretary shall make available, upon request and on not more than an 

annual basis, an anonymous itemization of 

such notifications, that includes— 

‘‘(I) a breakdown of States by the size and 

type of employers submitting such notification; and 

‘‘(II) a summary of the data received under 

clause (ii). 

‘‘(F) AUDITS BY APPROPRIATE AGENCIES.—To 

determine compliance with this paragraph, 

the Secretary may audit the books and 

records of a group health plan relating to an 

exemption, including any actuarial reports 

prepared pursuant to subparagraph (C), during the 6 year period following the notification of such exemption under subparagraph 

(E). A State agency receiving a notification 

under subparagraph (E) may also conduct 

such an audit with respect to an exemption 

covered by such notification.’’; 

(4) in subsection (e), by striking paragraph 

(4) and inserting the following: 

‘‘(4) MENTAL HEALTH BENEFITS.—The term 

‘mental health benefits’ means benefits with 

respect to services for mental health conditions, as defined under the terms of the plan 

and in accordance with applicable Federal 

and State law. 

‘‘(5) SUBSTANCE USE DISORDER BENEFITS.— 

The term ‘substance use disorder benefits’ 

means benefits with respect to services for 

substance use disorders, as defined under the 

terms of the plan and in accordance with applicable Federal and State law.’’; 

(5) by striking subsection (f); 

(6) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health and substance 

use disorder benefits’’ each place it appears 

in subsections (a)(1)(B)(i), (a)(1)(C), 

(a)(2)(B)(i), and (a)(2)(C); and 

(7) by striking ‘‘mental health benefits’’ 

and inserting ‘‘mental health or substance 

use disorder benefits’’ each place it appears 

(other than in any provision amended by the 

previous paragraph). 

(d) REGULATIONS.—Not later than 1 year 

after the date of enactment of this Act, the 

Secretaries of Labor, Health and Human 

Services, and the Treasury shall issue regulations to carry out the amendments made 

by subsections (a), (b), and (c), respectively. 

(e) EFFECTIVE DATE.— 

(1) IN GENERAL.—The amendments made by 

this section shall apply with respect to group 

health plans for plan years beginning after 

the date that is 1 year after the date of enactment of this Act, regardless of whether 

regulations have been issued to carry out 

such amendments by such effective date, except that the amendments made by subsections (a)(5), (b)(5), and (c)(5), relating to 

striking of certain sunset provisions, shall 

take effect on January 1, 2009. 

(2) SPECIAL RULE FOR COLLECTIVE BARGAINING AGREEMENTS.—In the case of a group 

health plan maintained pursuant to one or 

more collective bargaining agreements between employee representatives and one or 

more employers ratified before the date of 

the enactment of this Act, the amendments 

made by this section shall not apply to plan 

years beginning before the later of— 

(A) the date on which the last of the collective bargaining agreements relating to the 

plan terminates (determined without regard 

to any extension thereof agreed to after the 

date of the enactment of this Act), or 

(B) January 1, 2009. 

For purposes of subparagraph (A), any plan 

amendment made pursuant to a collective 

bargaining agreement relating to the plan 

which amends the plan solely to conform to 

any requirement added by this section shall 

not be treated as a termination of such collective bargaining agreement. 

(f) ASSURING COORDINATION.—The Secretary of Health and Human Services, the 

Secretary of Labor, and the Secretary of the 

Treasury may ensure, through the execution 

or revision of an interagency memorandum 

of understanding among such Secretaries, 

that— 

(1) regulations, rulings, and interpretations issued by such Secretaries relating to 

the same matter over which two or more 

such Secretaries have responsibility under 

this section (and the amendments made by 

this section) are administered so as to have 

the same effect at all times; and 

(2) coordination of policies relating to enforcing the same requirements through such 

Secretaries in order to have a coordinated 

enforcement strategy that avoids duplication of enforcement efforts and assigns priorities in enforcement. 

(g) CONFORMING CLERICAL AMENDMENTS.— 

(1) ERISA HEADING.— 

(A) IN GENERAL.—The heading of section 

712 of the Employee Retirement Income Security Act of 1974 is amended to read as follows: 

‘‘SEC. 712. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.’’. 

(B) CLERICAL AMENDMENT.—The table of 

contents in section 1 of such Act is amended 

by striking the item relating to section 712 

and inserting the following new item: 

‘‘Sec. 712. Parity in mental health and substance use disorder benefits.’’. 

(2) PHSA HEADING.—The heading of section 

2705 of the Public Health Service Act is 

amended to read as follows: 

‘‘SEC. 2705. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.’’. 

(3) IRC HEADING.— 

(A) IN GENERAL.—The heading of section 

9812 of the Internal Revenue Code of 1986 is 

amended to read as follows: 

‘‘SEC. 9812. PARITY IN MENTAL HEALTH AND SUBSTANCE USE DISORDER BENEFITS.’’. 

(B) CLERICAL AMENDMENT.—The table of 

sections for subchapter B of chapter 100 of 

such Code is amended by striking the item 

relating to section 9812 and inserting the following new item: 

‘‘Sec. 9812. Parity in mental health and substance use disorder benefits.’’. 

(h) GAO STUDY ON COVERAGE AND EXCLUSION OF MENTAL HEALTH AND SUBSTANCE USE

DISORDER DIAGNOSES.— 

(1) IN GENERAL.—The Comptroller General 

of the United States shall conduct a study 

that analyzes the specific rates, patterns, 

and trends in coverage and exclusion of specific mental health and substance use disorder diagnoses by health plans and health 

insurance. The study shall include an analysis of— 

(A) specific coverage rates for all mental 

health conditions and substance use disorders; 

(B) which diagnoses are most commonly 

covered or excluded; 

(C) whether implementation of this Act 

has affected trends in coverage or exclusion 

of such diagnoses; and 

(D) the impact of covering or excluding 

specific diagnoses on participants’ and enrollees’ health, their health care coverage, 

and the costs of delivering health care. 

(2) REPORTS.—Not later than 3 years after 

the date of the enactment of this Act, and 2 

years after the date of submission the first 

report under this paragraph, the Comptroller 

General shall submit to Congress a report on 

the results of the study conducted under 

paragraph (1). 

TITLE VI—OTHER PROVISIONS 

SEC. 601. SECURE RURAL SCHOOLS AND COMMUNITY SELF-DETERMINATION PROGRAM. 

(a) REAUTHORIZATION OF THE SECURE RURAL

SCHOOLS AND COMMUNITY SELF-DETERMINATION ACT OF 2000.—The Secure Rural Schools 

and Community Self-Determination Act of 

2000 (16 U.S.C. 500 note; Public Law 106–393) is 


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S10376 CONGRESSIONAL RECORD — SENATE October 1, 2008 

amended by striking sections 1 through 403 

and inserting the following: 

‘‘SECTION 1. SHORT TITLE. 

‘‘This Act may be cited as the ‘Secure 

Rural Schools and Community Self-Determination Act of 2000’. 

‘‘SEC. 2. PURPOSES. 

‘‘The purposes of this Act are— 

‘‘(1) to stabilize and transition payments 

to counties to provide funding for schools 

and roads that supplements other available 

funds; 

‘‘(2) to make additional investments in, 

and create additional employment opportunities through, projects that— 

‘‘(A)(i) improve the maintenance of existing infrastructure; 

‘‘(ii) implement stewardship objectives 

that enhance forest ecosystems; and 

‘‘(iii) restore and improve land health and 

water quality; 

‘‘(B) enjoy broad-based support; and 

‘‘(C) have objectives that may include— 

‘‘(i) road, trail, and infrastructure maintenance or obliteration; 

‘‘(ii) soil productivity improvement; 

‘‘(iii) improvements in forest ecosystem 

health; 

‘‘(iv) watershed restoration and maintenance; 

‘‘(v) the restoration, maintenance, and improvement of wildlife and fish habitat; 

‘‘(vi) the control of noxious and exotic 

weeds; and 

‘‘(vii) the reestablishment of native species; and 

‘‘(3) to improve cooperative relationships 

among— 

‘‘(A) the people that use and care for Federal land; and 

‘‘(B) the agencies that manage the Federal 

land. 

‘‘SEC. 3. DEFINITIONS. 

‘‘In this Act: 

‘‘(1) ADJUSTED SHARE.—The term ‘adjusted 

share’ means the number equal to the 

quotient obtained by dividing— 

‘‘(A) the number equal to the quotient obtained by dividing— 

‘‘(i) the base share for the eligible county; 

by 

‘‘(ii) the income adjustment for the eligible 

county; by 

‘‘(B) the number equal to the sum of the 

quotients obtained under subparagraph (A) 

and paragraph (8)(A) for all eligible counties. 

‘‘(2) BASE SHARE.—The term ‘base share’ 

means the number equal to the average of— 

‘‘(A) the quotient obtained by dividing— 

‘‘(i) the number of acres of Federal land described in paragraph (7)(A) in each eligible 

county; by 

‘‘(ii) the total number acres of Federal land 

in all eligible counties in all eligible States; 

and 

‘‘(B) the quotient obtained by dividing— 

‘‘(i) the amount equal to the average of the 

3 highest 25-percent payments and safety net 

payments made to each eligible State for 

each eligible county during the eligibility 

period; by 

‘‘(ii) the amount equal to the sum of the 

amounts calculated under clause (i) and 

paragraph (9)(B)(i) for all eligible counties in 

all eligible States during the eligibility period. 

‘‘(3) COUNTY PAYMENT.—The term ‘county 

payment’ means the payment for an eligible 

county calculated under section 101(b). 

‘‘(4) ELIGIBLE COUNTY.—The term ‘eligible 

county’ means any county that— 

‘‘(A) contains Federal land (as defined in 

paragraph (7)); and 

‘‘(B) elects to receive a share of the State 

payment or the county payment under section 102(b). 

‘‘(5) ELIGIBILITY PERIOD.—The term ‘eligibility period’ means fiscal year 1986 through 

fiscal year 1999. 

‘‘(6) ELIGIBLE STATE.—The term ‘eligible 

State’ means a State or territory of the 

United States that received a 25-percent payment for 1 or more fiscal years of the eligibility period. 

‘‘(7) FEDERAL LAND.—The term ‘Federal 

land’ means— 

‘‘(A) land within the National Forest System, as defined in section 11(a) of the Forest 

and Rangeland Renewable Resources Planning Act of 1974 (16 U.S.C. 1609(a)) exclusive 

of the National Grasslands and land utilization projects designated as National Grasslands administered pursuant to the Act of 

July 22, 1937 (7 U.S.C. 1010–1012); and 

‘‘(B) such portions of the revested Oregon 

and California Railroad and reconveyed Coos 

Bay Wagon Road grant land as are or may 

hereafter come under the jurisdiction of the 

Department of the Interior, which have heretofore or may hereafter be classified as 

timberlands, and power-site land valuable 

for timber, that shall be managed, except as 

provided in the former section 3 of the Act of 

August 28, 1937 (50 Stat. 875; 43 U.S.C. 1181c), 

for permanent forest production. 

‘‘(8) 50-PERCENT ADJUSTED SHARE.—The 

term ‘50-percent adjusted share’ means the 

number equal to the quotient obtained by dividing— 

‘‘(A) the number equal to the quotient obtained by dividing— 

‘‘(i) the 50-percent base share for the eligible county; by 

‘‘(ii) the income adjustment for the eligible 

county; by 

‘‘(B) the number equal to the sum of the 

quotients obtained under subparagraph (A) 

and paragraph (1)(A) for all eligible counties. 

‘‘(9) 50-PERCENT BASE SHARE.—The term ‘50- 

percent base share’ means the number equal 

to the average of— 

‘‘(A) the quotient obtained by dividing— 

‘‘(i) the number of acres of Federal land described in paragraph (7)(B) in each eligible 

county; by 

‘‘(ii) the total number acres of Federal land 

in all eligible counties in all eligible States; 

and 

‘‘(B) the quotient obtained by dividing— 

‘‘(i) the amount equal to the average of the 

3 highest 50-percent payments made to each 

eligible county during the eligibility period; 

by 

‘‘(ii) the amount equal to the sum of the 

amounts calculated under clause (i) and 

paragraph (2)(B)(i) for all eligible counties in 

all eligible States during the eligibility period. 

‘‘(10) 50-PERCENT PAYMENT.—The term ‘50- 

percent payment’ means the payment that is 

the sum of the 50-percent share otherwise 

paid to a county pursuant to title II of the 

Act of August 28, 1937 (chapter 876; 50 Stat. 

875; 43 U.S.C. 1181f), and the payment made 

to a county pursuant to the Act of May 24, 

1939 (chapter 144; 53 Stat. 753; 43 U.S.C. 1181f– 

1 et seq.). 

‘‘(11) FULL FUNDING AMOUNT.—The term 

‘full funding amount’ means— 

‘‘(A) $500,000,000 for fiscal year 2008; and 

‘‘(B) for fiscal year 2009 and each fiscal 

year thereafter, the amount that is equal to 

90 percent of the full funding amount for the 

preceding fiscal year. 

‘‘(12) INCOME ADJUSTMENT.—The term ‘income adjustment’ means the square of the 

quotient obtained by dividing— 

‘‘(A) the per capita personal income for 

each eligible county; by 

‘‘(B) the median per capita personal income of all eligible counties. 

‘‘(13) PER CAPITA PERSONAL INCOME.—The 

term ‘per capita personal income’ means the 

most recent per capita personal income data, 

as determined by the Bureau of Economic 

Analysis. 

‘‘(14) SAFETY NET PAYMENTS.—The term 

‘safety net payments’ means the special payment amounts paid to States and counties 

required by section 13982 or 13983 of the Omnibus Budget Reconciliation Act of 1993 

(Public Law 103–66; 16 U.S.C. 500 note; 43 

U.S.C. 1181f note). 

‘‘(15) SECRETARY CONCERNED.—The term 

‘Secretary concerned’ means— 

‘‘(A) the Secretary of Agriculture or the 

designee of the Secretary of Agriculture with 

respect to the Federal land described in paragraph (7)(A); and 

‘‘(B) the Secretary of the Interior or the 

designee of the Secretary of the Interior 

with respect to the Federal land described in 

paragraph (7)(B). 

‘‘(16) STATE PAYMENT.—The term ‘State 

payment’ means the payment for an eligible 

State calculated under section 101(a). 

‘‘(17) 25-PERCENT PAYMENT.—The term ‘25- 

percent payment’ means the payment to 

States required by the sixth paragraph under 

the heading of ‘FOREST SERVICE’ in the 

Act of May 23, 1908 (35 Stat. 260; 16 U.S.C. 

500), and section 13 of the Act of March 1, 

1911 (36 Stat. 963; 16 U.S.C. 500). 

‘‘TITLE I—SECURE PAYMENTS FOR 

STATES AND COUNTIES CONTAINING 

FEDERAL LAND 

‘‘SEC. 101. SECURE PAYMENTS FOR STATES CONTAINING FEDERAL LAND. 

‘‘(a) STATE PAYMENT.—For each of fiscal 

years 2008 through 2011, the Secretary of Agriculture shall calculate for each eligible 

State an amount equal to the sum of the 

products obtained by multiplying— 

‘‘(1) the adjusted share for each eligible 

county within the eligible State; by 

‘‘(2) the full funding amount for the fiscal 

year. 

‘‘(b) COUNTY PAYMENT.—For each of fiscal 

years 2008 through 2011, the Secretary of the 

Interior shall calculate for each eligible 

county that received a 50-percent payment 

during the eligibility period an amount 

equal to the product obtained by multiplying— 

‘‘(1) the 50-percent adjusted share for the 

eligible county; by 

‘‘(2) the full funding amount for the fiscal 

year. 

‘‘SEC. 102. PAYMENTS TO STATES AND COUNTIES. 

‘‘(a) PAYMENT AMOUNTS.—Except as provided in section 103, the Secretary of the 

Treasury shall pay to— 

‘‘(1) a State or territory of the United 

States an amount equal to the sum of the 

amounts elected under subsection (b) by each 

county within the State or territory for— 

‘‘(A) if the county is eligible for the 25-percent payment, the share of the 25-percent 

payment; or 

‘‘(B) the share of the State payment of the 

eligible county; and 

‘‘(2) a county an amount equal to the 

amount elected under subsection (b) by each 

county for— 

‘‘(A) if the county is eligible for the 50-percent payment, the 50-percent payment; or 

‘‘(B) the county payment for the eligible 

county. 

‘‘(b) ELECTION TO RECEIVE PAYMENT

AMOUNT.— 

‘‘(1) ELECTION; SUBMISSION OF RESULTS.— 

‘‘(A) IN GENERAL.—The election to receive 

a share of the State payment, the county 

payment, a share of the State payment and 

the county payment, a share of the 25-percent payment, the 50-percent payment, or a 

share of the 25-percent payment and the 50- 

percent payment, as applicable, shall be 

made at the discretion of each affected county by August 1, 2008 (or as soon thereafter as 

the Secretary concerned determines is practicable), and August 1 of each second fiscal 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10377 

year thereafter, in accordance with paragraph (2), and transmitted to the Secretary 

concerned by the Governor of each eligible 

State. 

‘‘(B) FAILURE TO TRANSMIT.—If an election 

for an affected county is not transmitted to 

the Secretary concerned by the date specified under subparagraph (A), the affected 

county shall be considered to have elected to 

receive a share of the State payment, the 

county payment, or a share of the State payment and the county payment, as applicable. 

‘‘(2) DURATION OF ELECTION.— 

‘‘(A) IN GENERAL.—A county election to receive a share of the 25-percent payment or 

50-percent payment, as applicable, shall be 

effective for 2 fiscal years. 

‘‘(B) FULL FUNDING AMOUNT.—If a county 

elects to receive a share of the State payment or the county payment, the election 

shall be effective for all subsequent fiscal 

years through fiscal year 2011. 

‘‘(3) SOURCE OF PAYMENT AMOUNTS.—The 

payment to an eligible State or eligible 

county under this section for a fiscal year 

shall be derived from— 

‘‘(A) any amounts that are appropriated to 

carry out this Act; 

‘‘(B) any revenues, fees, penalties, or miscellaneous receipts, exclusive of deposits to 

any relevant trust fund, special account, or 

permanent operating funds, received by the 

Federal Government from activities by the 

Bureau of Land Management or the Forest 

Service on the applicable Federal land; and 

‘‘(C) to the extent of any shortfall, out of 

any amounts in the Treasury of the United 

States not otherwise appropriated. 

‘‘(c) DISTRIBUTION AND EXPENDITURE OF

PAYMENTS.— 

‘‘(1) DISTRIBUTION METHOD.—A State that 

receives a payment under subsection (a) for 

Federal land described in section 3(7)(A) 

shall distribute the appropriate payment 

amount among the appropriate counties in 

the State in accordance with— 

‘‘(A) the Act of May 23, 1908 (16 U.S.C. 500); 

and 

‘‘(B) section 13 of the Act of March 1, 1911 

(36 Stat. 963; 16 U.S.C. 500). 

‘‘(2) EXPENDITURE PURPOSES.—Subject to 

subsection (d), payments received by a State 

under subsection (a) and distributed to counties in accordance with paragraph (1) shall be 

expended as required by the laws referred to 

in paragraph (1). 

‘‘(d) EXPENDITURE RULES FOR ELIGIBLE

COUNTIES.— 

‘‘(1) ALLOCATIONS.— 

‘‘(A) USE OF PORTION IN SAME MANNER AS 25- 

PERCENT PAYMENT OR 50-PERCENT PAYMENT, AS

APPLICABLE.—Except as provided in paragraph (3)(B), if an eligible county elects to 

receive its share of the State payment or the 

county payment, not less than 80 percent, 

but not more than 85 percent, of the funds 

shall be expended in the same manner in 

which the 25-percent payments or 50-percent 

payment, as applicable, are required to be 

expended. 

‘‘(B) ELECTION AS TO USE OF BALANCE.—Except as provided in subparagraph (C), an eligible county shall elect to do 1 or more of 

the following with the balance of any funds 

not expended pursuant to subparagraph (A): 

‘‘(i) Reserve any portion of the balance for 

projects in accordance with title II. 

‘‘(ii) Reserve not more than 7 percent of 

the total share for the eligible county of the 

State payment or the county payment for 

projects in accordance with title III. 

‘‘(iii) Return the portion of the balance not 

reserved under clauses (i) and (ii) to the 

Treasury of the United States. 

‘‘(C) COUNTIES WITH MODEST DISTRIBUTIONS.—In the case of each eligible county to 

which more than $100,000, but less than 

$350,000, is distributed for any fiscal year 

pursuant to either or both of paragraphs 

(1)(B) and (2)(B) of subsection (a), the eligible 

county, with respect to the balance of any 

funds not expended pursuant to subparagraph (A) for that fiscal year, shall— 

‘‘(i) reserve any portion of the balance 

for— 

‘‘(I) carrying out projects under title II; 

‘‘(II) carrying out projects under title III; 

or 

‘‘(III) a combination of the purposes described in subclauses (I) and (II); or 

‘‘(ii) return the portion of the balance not 

reserved under clause (i) to the Treasury of 

the United States. 

‘‘(2) DISTRIBUTION OF FUNDS.— 

‘‘(A) IN GENERAL.—Funds reserved by an eligible county under subparagraph (B)(i) or 

(C)(i) of paragraph (1) for carrying out 

projects under title II shall be deposited in a 

special account in the Treasury of the 

United States. 

‘‘(B) AVAILABILITY.—Amounts deposited 

under subparagraph (A) shall— 

‘‘(i) be available for expenditure by the 

Secretary concerned, without further appropriation; and 

‘‘(ii) remain available until expended in accordance with title II. 

‘‘(3) ELECTION.— 

‘‘(A) NOTIFICATION.— 

‘‘(i) IN GENERAL.—An eligible county shall 

notify the Secretary concerned of an election by the eligible county under this subsection not later than September 30, 2008 (or 

as soon thereafter as the Secretary concerned determines is practicable), and each 

September 30 thereafter for each succeeding 

fiscal year. 

‘‘(ii) FAILURE TO ELECT.—Except as provided in subparagraph (B), if the eligible 

county fails to make an election by the date 

specified in clause (i), the eligible county 

shall— 

‘‘(I) be considered to have elected to expend 85 percent of the funds in accordance 

with paragraph (1)(A); and 

‘‘(II) return the balance to the Treasury of 

the United States. 

‘‘(B) COUNTIES WITH MINOR DISTRIBUTIONS.— 

In the case of each eligible county to which 

less than $100,000 is distributed for any fiscal 

year pursuant to either or both of paragraphs (1)(B) and (2)(B) of subsection (a), the 

eligible county may elect to expend all the 

funds in the same manner in which the 25- 

percent payments or 50-percent payments, as 

applicable, are required to be expended. 

‘‘(e) TIME FOR PAYMENT.—The payments required under this section for a fiscal year 

shall be made as soon as practicable after 

the end of that fiscal year. 

‘‘SEC. 103. TRANSITION PAYMENTS TO STATES. 

‘‘(a) DEFINITIONS.—In this section: 

‘‘(1) ADJUSTED AMOUNT.—The term ‘adjusted amount’ means, with respect to a covered State— 

‘‘(A) for fiscal year 2008, 90 percent of— 

‘‘(i) the sum of the amounts paid for fiscal 

year 2006 under section 102(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the covered State that have elected 

under section 102(b) to receive a share of the 

State payment for fiscal year 2008; and 

‘‘(ii) the sum of the amounts paid for fiscal 

year 2006 under section 103(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the State of Oregon that have elected 

under section 102(b) to receive the county 

payment for fiscal year 2008; 

‘‘(B) for fiscal year 2009, 81 percent of— 

‘‘(i) the sum of the amounts paid for fiscal 

year 2006 under section 102(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the covered State that have elected 

under section 102(b) to receive a share of the 

State payment for fiscal year 2009; and 

‘‘(ii) the sum of the amounts paid for fiscal 

year 2006 under section 103(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the State of Oregon that have elected 

under section 102(b) to receive the county 

payment for fiscal year 2009; and 

‘‘(C) for fiscal year 2010, 73 percent of— 

‘‘(i) the sum of the amounts paid for fiscal 

year 2006 under section 102(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the covered State that have elected 

under section 102(b) to receive a share of the 

State payment for fiscal year 2010; and 

‘‘(ii) the sum of the amounts paid for fiscal 

year 2006 under section 103(a)(2) (as in effect 

on September 29, 2006) for the eligible counties in the State of Oregon that have elected 

under section 102(b) to receive the county 

payment for fiscal year 2010. 

‘‘(2) COVERED STATE.—The term ‘covered 

State’ means each of the States of California, Louisiana, Oregon, Pennsylvania, 

South Carolina, South Dakota, Texas, and 

Washington. 

‘‘(b) TRANSITION PAYMENTS.—For each of 

fiscal years 2008 through 2010, in lieu of the 

payment amounts that otherwise would have 

been made under paragraphs (1)(B) and (2)(B) 

of section 102(a), the Secretary of the Treasury shall pay the adjusted amount to each 

covered State and the eligible counties within the covered State, as applicable. 

‘‘(c) DISTRIBUTION OF ADJUSTED AMOUNT.— 

Except as provided in subsection (d), it is the 

intent of Congress that the method of distributing the payments under subsection (b) 

among the counties in the covered States for 

each of fiscal years 2008 through 2010 be in 

the same proportion that the payments were 

distributed to the eligible counties in fiscal 

year 2006. 

‘‘(d) DISTRIBUTION OF PAYMENTS IN CALIFORNIA.—The following payments shall be 

distributed among the eligible counties in 

the State of California in the same proportion that payments under section 102(a)(2) 

(as in effect on September 29, 2006) were distributed to the eligible counties for fiscal 

year 2006: 

‘‘(1) Payments to the State of California 

under subsection (b). 

‘‘(2) The shares of the eligible counties of 

the State payment for California under section 102 for fiscal year 2011. 

‘‘(e) TREATMENT OF PAYMENTS.—For purposes of this Act, any payment made under 

subsection (b) shall be considered to be a 

payment made under section 102(a). 

‘‘TITLE II—SPECIAL PROJECTS ON 

FEDERAL LAND 

‘‘SEC. 201. DEFINITIONS. 

‘‘In this title: 

‘‘(1) PARTICIPATING COUNTY.—The term 

‘participating county’ means an eligible 

county that elects under section 102(d) to expend a portion of the Federal funds received 

under section 102 in accordance with this 

title. 

‘‘(2) PROJECT FUNDS.—The term ‘project 

funds’ means all funds an eligible county 

elects under section 102(d) to reserve for expenditure in accordance with this title. 

‘‘(3) RESOURCE ADVISORY COMMITTEE.—The 

term ‘resource advisory committee’ means— 

‘‘(A) an advisory committee established by 

the Secretary concerned under section 205; or 

‘‘(B) an advisory committee determined by 

the Secretary concerned to meet the requirements of section 205. 

‘‘(4) RESOURCE MANAGEMENT PLAN.—The 

term ‘resource management plan’ means— 

‘‘(A) a land use plan prepared by the Bureau of Land Management for units of the 

Federal land described in section 3(7)(B) pursuant to section 202 of the Federal Land Policy and Management Act of 1976 (43 U.S.C. 

1712); or 


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‘‘(B) a land and resource management plan 

prepared by the Forest Service for units of 

the National Forest System pursuant to section 6 of the Forest and Rangeland Renewable Resources Planning Act of 1974 (16 

U.S.C. 1604). 

‘‘SEC. 202. GENERAL LIMITATION ON USE OF 

PROJECT FUNDS. 

‘‘(a) LIMITATION.—Project funds shall be expended solely on projects that meet the requirements of this title. 

‘‘(b) AUTHORIZED USES.—Project funds may 

be used by the Secretary concerned for the 

purpose of entering into and implementing 

cooperative agreements with willing Federal 

agencies, State and local governments, private and nonprofit entities, and landowners 

for protection, restoration, and enhancement 

of fish and wildlife habitat, and other resource objectives consistent with the purposes of this Act on Federal land and on nonFederal land where projects would benefit 

the resources on Federal land. 

‘‘SEC. 203. SUBMISSION OF PROJECT PROPOSALS. 

‘‘(a) SUBMISSION OF PROJECT PROPOSALS TO

SECRETARY CONCERNED.— 

‘‘(1) PROJECTS FUNDED USING PROJECT

FUNDS.—Not later than September 30 for fiscal year 2008 (or as soon thereafter as the 

Secretary concerned determines is practicable), and each September 30 thereafter 

for each succeeding fiscal year through fiscal 

year 2011, each resource advisory committee 

shall submit to the Secretary concerned a 

description of any projects that the resource 

advisory committee proposes the Secretary 

undertake using any project funds reserved 

by eligible counties in the area in which the 

resource advisory committee has geographic 

jurisdiction. 

‘‘(2) PROJECTS FUNDED USING OTHER

FUNDS.—A resource advisory committee may 

submit to the Secretary concerned a description of any projects that the committee proposes the Secretary undertake using funds 

from State or local governments, or from the 

private sector, other than project funds and 

funds appropriated and otherwise available 

to do similar work. 

‘‘(3) JOINT PROJECTS.—Participating counties or other persons may propose to pool 

project funds or other funds, described in 

paragraph (2), and jointly propose a project 

or group of projects to a resource advisory 

committee established under section 205. 

‘‘(b) REQUIRED DESCRIPTION OF PROJECTS.— 

In submitting proposed projects to the Secretary concerned under subsection (a), a resource advisory committee shall include in 

the description of each proposed project the 

following information: 

‘‘(1) The purpose of the project and a description of how the project will meet the 

purposes of this title. 

‘‘(2) The anticipated duration of the 

project. 

‘‘(3) The anticipated cost of the project. 

‘‘(4) The proposed source of funding for the 

project, whether project funds or other 

funds. 

‘‘(5)(A) Expected outcomes, including how 

the project will meet or exceed desired ecological conditions, maintenance objectives, 

or stewardship objectives. 

‘‘(B) An estimate of the amount of any 

timber, forage, and other commodities and 

other economic activity, including jobs generated, if any, anticipated as part of the 

project. 

‘‘(6) A detailed monitoring plan, including 

funding needs and sources, that— 

‘‘(A) tracks and identifies the positive or 

negative impacts of the project, implementation, and provides for validation monitoring; 

and 

‘‘(B) includes an assessment of the following: 

‘‘(i) Whether or not the project met or exceeded desired ecological conditions; created 

local employment or training opportunities, 

including summer youth jobs programs such 

as the Youth Conservation Corps where appropriate. 

‘‘(ii) Whether the project improved the use 

of, or added value to, any products removed 

from land consistent with the purposes of 

this title. 

‘‘(7) An assessment that the project is to be 

in the public interest. 

‘‘(c) AUTHORIZED PROJECTS.—Projects proposed under subsection (a) shall be consistent with section 2. 

‘‘SEC. 204. EVALUATION AND APPROVAL OF 

PROJECTS BY SECRETARY CONCERNED. 

‘‘(a) CONDITIONS FOR APPROVAL OF PROPOSED PROJECT.—The Secretary concerned 

may make a decision to approve a project 

submitted by a resource advisory committee 

under section 203 only if the proposed project 

satisfies each of the following conditions: 

‘‘(1) The project complies with all applicable Federal laws (including regulations). 

‘‘(2) The project is consistent with the applicable resource management plan and with 

any watershed or subsequent plan developed 

pursuant to the resource management plan 

and approved by the Secretary concerned. 

‘‘(3) The project has been approved by the 

resource advisory committee in accordance 

with section 205, including the procedures 

issued under subsection (e) of that section. 

‘‘(4) A project description has been submitted by the resource advisory committee 

to the Secretary concerned in accordance 

with section 203. 

‘‘(5) The project will improve the maintenance of existing infrastructure, implement 

stewardship objectives that enhance forest 

ecosystems, and restore and improve land 

health and water quality. 

‘‘(b) ENVIRONMENTAL REVIEWS.— 

‘‘(1) REQUEST FOR PAYMENT BY COUNTY.— 

The Secretary concerned may request the resource advisory committee submitting a proposed project to agree to the use of project 

funds to pay for any environmental review, 

consultation, or compliance with applicable 

environmental laws required in connection 

with the project. 

‘‘(2) CONDUCT OF ENVIRONMENTAL REVIEW.— 

If a payment is requested under paragraph 

(1) and the resource advisory committee 

agrees to the expenditure of funds for this 

purpose, the Secretary concerned shall conduct environmental review, consultation, or 

other compliance responsibilities in accordance with Federal laws (including regulations). 

‘‘(3) EFFECT OF REFUSAL TO PAY.— 

‘‘(A) IN GENERAL.—If a resource advisory 

committee does not agree to the expenditure 

of funds under paragraph (1), the project 

shall be deemed withdrawn from further consideration by the Secretary concerned pursuant to this title. 

‘‘(B) EFFECT OF WITHDRAWAL.—A withdrawal under subparagraph (A) shall be 

deemed to be a rejection of the project for 

purposes of section 207(c). 

‘‘(c) DECISIONS OF SECRETARY CONCERNED.— 

‘‘(1) REJECTION OF PROJECTS.— 

‘‘(A) IN GENERAL.—A decision by the Secretary concerned to reject a proposed project 

shall be at the sole discretion of the Secretary concerned. 

‘‘(B) NO ADMINISTRATIVE APPEAL OR JUDICIAL REVIEW.—Notwithstanding any other 

provision of law, a decision by the Secretary 

concerned to reject a proposed project shall 

not be subject to administrative appeal or 

judicial review. 

‘‘(C) NOTICE OF REJECTION.—Not later than 

30 days after the date on which the Secretary 

concerned makes the rejection decision, the 

Secretary concerned shall notify in writing 

the resource advisory committee that submitted the proposed project of the rejection 

and the reasons for rejection. 

‘‘(2) NOTICE OF PROJECT APPROVAL.—The 

Secretary concerned shall publish in the 

Federal Register notice of each project approved under subsection (a) if the notice 

would be required had the project originated 

with the Secretary. 

‘‘(d) SOURCE AND CONDUCT OF PROJECT.— 

Once the Secretary concerned accepts a 

project for review under section 203, the acceptance shall be deemed a Federal action 

for all purposes. 

‘‘(e) IMPLEMENTATION OF APPROVED

PROJECTS.— 

‘‘(1) COOPERATION.—Notwithstanding chapter 63 of title 31, United States Code, using 

project funds the Secretary concerned may 

enter into contracts, grants, and cooperative 

agreements with States and local governments, private and nonprofit entities, and 

landowners and other persons to assist the 

Secretary in carrying out an approved 

project. 

‘‘(2) BEST VALUE CONTRACTING.— 

‘‘(A) IN GENERAL.—For any project involving a contract authorized by paragraph (1) 

the Secretary concerned may elect a source 

for performance of the contract on a best 

value basis. 

‘‘(B) FACTORS.—The Secretary concerned 

shall determine best value based on such factors as— 

‘‘(i) the technical demands and complexity 

of the work to be done; 

‘‘(ii)(I) the ecological objectives of the 

project; and 

‘‘(II) the sensitivity of the resources being 

treated; 

‘‘(iii) the past experience by the contractor 

with the type of work being done, using the 

type of equipment proposed for the project, 

and meeting or exceeding desired ecological 

conditions; and 

‘‘(iv) the commitment of the contractor to 

hiring highly qualified workers and local 

residents. 

‘‘(3) MERCHANTABLE TIMBER CONTRACTING

PILOT PROGRAM.— 

‘‘(A) ESTABLISHMENT.—The Secretary concerned shall establish a pilot program to implement a certain percentage of approved 

projects involving the sale of merchantable 

timber using separate contracts for— 

‘‘(i) the harvesting or collection of merchantable timber; and 

‘‘(ii) the sale of the timber. 

‘‘(B) ANNUAL PERCENTAGES.—Under the 

pilot program, the Secretary concerned shall 

ensure that, on a nationwide basis, not less 

than the following percentage of all approved projects involving the sale of merchantable timber are implemented using separate contracts: 

‘‘(i) For fiscal year 2008, 35 percent. 

‘‘(ii) For fiscal year 2009, 45 percent. 

‘‘(iii) For each of fiscal years 2010 and 2011, 

50 percent. 

‘‘(C) INCLUSION IN PILOT PROGRAM.—The decision whether to use separate contracts to 

implement a project involving the sale of 

merchantable timber shall be made by the 

Secretary concerned after the approval of 

the project under this title. 

‘‘(D) ASSISTANCE.— 

‘‘(i) IN GENERAL.—The Secretary concerned 

may use funds from any appropriated account available to the Secretary for the Federal land to assist in the administration of 

projects conducted under the pilot program. 

‘‘(ii) MAXIMUM AMOUNT OF ASSISTANCE.— 

The total amount obligated under this subparagraph may not exceed $1,000,000 for any 

fiscal year during which the pilot program is 

in effect. 

‘‘(E) REVIEW AND REPORT.— 


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‘‘(i) INITIAL REPORT.—Not later than September 30, 2010, the Comptroller General 

shall submit to the Committees on Agriculture, Nutrition, and Forestry and Energy 

and Natural Resources of the Senate and the 

Committees on Agriculture and Natural Resources of the House of Representatives a report assessing the pilot program. 

‘‘(ii) ANNUAL REPORT.—The Secretary concerned shall submit to the Committees on 

Agriculture, Nutrition, and Forestry and Energy and Natural Resources of the Senate 

and the Committees on Agriculture and Natural Resources of the House of Representatives an annual report describing the results 

of the pilot program. 

‘‘(f) REQUIREMENTS FOR PROJECT FUNDS.— 

The Secretary shall ensure that at least 50 

percent of all project funds be used for 

projects that are primarily dedicated— 

‘‘(1) to road maintenance, decommissioning, or obliteration; or 

‘‘(2) to restoration of streams and watersheds. 

‘‘SEC. 205. RESOURCE ADVISORY COMMITTEES. 

‘‘(a) ESTABLISHMENT AND PURPOSE OF RESOURCE ADVISORY COMMITTEES.— 

‘‘(1) ESTABLISHMENT.—The Secretary concerned shall establish and maintain resource 

advisory committees to perform the duties 

in subsection (b), except as provided in paragraph (4). 

‘‘(2) PURPOSE.—The purpose of a resource 

advisory committee shall be— 

‘‘(A) to improve collaborative relationships; and 

‘‘(B) to provide advice and recommendations to the land management agencies consistent with the purposes of this title. 

‘‘(3) ACCESS TO RESOURCE ADVISORY COMMITTEES.—To ensure that each unit of Federal 

land has access to a resource advisory committee, and that there is sufficient interest 

in participation on a committee to ensure 

that membership can be balanced in terms of 

the points of view represented and the functions to be performed, the Secretary concerned may, establish resource advisory 

committees for part of, or 1 or more, units of 

Federal land. 

‘‘(4) EXISTING ADVISORY COMMITTEES.— 

‘‘(A) IN GENERAL.—An advisory committee 

that meets the requirements of this section, 

a resource advisory committee established 

before September 29, 2006, or an advisory 

committee determined by the Secretary concerned before September 29, 2006, to meet the 

requirements of this section may be deemed 

by the Secretary concerned to be a resource 

advisory committee for the purposes of this 

title. 

‘‘(B) CHARTER.—A charter for a committee 

described in subparagraph (A) that was filed 

on or before September 29, 2006, shall be considered to be filed for purposes of this Act. 

‘‘(C) BUREAU OF LAND MANAGEMENT ADVISORY COMMITTEES.—The Secretary of the Interior may deem a resource advisory committee meeting the requirements of subpart 

1784 of part 1780 of title 43, Code of Federal 

Regulations, as a resource advisory committee for the purposes of this title. 

‘‘(b) DUTIES.—A resource advisory committee shall— 

‘‘(1) review projects proposed under this 

title by participating counties and other persons; 

‘‘(2) propose projects and funding to the 

Secretary concerned under section 203; 

‘‘(3) provide early and continuous coordination with appropriate land management 

agency officials in recommending projects 

consistent with purposes of this Act under 

this title; 

‘‘(4) provide frequent opportunities for citizens, organizations, tribes, land management 

agencies, and other interested parties to participate openly and meaningfully, beginning 

at the early stages of the project development process under this title; 

‘‘(5)(A) monitor projects that have been approved under section 204; and 

‘‘(B) advise the designated Federal official 

on the progress of the monitoring efforts 

under subparagraph (A); and 

‘‘(6) make recommendations to the Secretary concerned for any appropriate 

changes or adjustments to the projects being 

monitored by the resource advisory committee. 

‘‘(c) APPOINTMENT BY THE SECRETARY.— 

‘‘(1) APPOINTMENT AND TERM.— 

‘‘(A) IN GENERAL.—The Secretary concerned, shall appoint the members of resource advisory committees for a term of 4 

years beginning on the date of appointment. 

‘‘(B) REAPPOINTMENT.—The Secretary concerned may reappoint members to subsequent 4-year terms. 

‘‘(2) BASIC REQUIREMENTS.—The Secretary 

concerned shall ensure that each resource 

advisory committee established meets the 

requirements of subsection (d). 

‘‘(3) INITIAL APPOINTMENT.—Not later than 

180 days after the date of the enactment of 

this Act, the Secretary concerned shall make 

initial appointments to the resource advisory committees. 

‘‘(4) VACANCIES.—The Secretary concerned 

shall make appointments to fill vacancies on 

any resource advisory committee as soon as 

practicable after the vacancy has occurred. 

‘‘(5) COMPENSATION.—Members of the resource advisory committees shall not receive 

any compensation. 

‘‘(d) COMPOSITION OF ADVISORY COMMITTEE.— 

‘‘(1) NUMBER.—Each resource advisory 

committee shall be comprised of 15 members. 

‘‘(2) COMMUNITY INTERESTS REPRESENTED.— 

Committee members shall be representative 

of the interests of the following 3 categories: 

‘‘(A) 5 persons that— 

‘‘(i) represent organized labor or non-timber forest product harvester groups; 

‘‘(ii) represent developed outdoor recreation, off highway vehicle users, or commercial recreation activities; 

‘‘(iii) represent— 

‘‘(I) energy and mineral development interests; or 

‘‘(II) commercial or recreational fishing interests; 

‘‘(iv) represent the commercial timber industry; or 

‘‘(v) hold Federal grazing or other land use 

permits, or represent nonindustrial private 

forest land owners, within the area for which 

the committee is organized. 

‘‘(B) 5 persons that represent— 

‘‘(i) nationally recognized environmental 

organizations; 

‘‘(ii) regionally or locally recognized environmental organizations; 

‘‘(iii) dispersed recreational activities; 

‘‘(iv) archaeological and historical interests; or 

‘‘(v) nationally or regionally recognized 

wild horse and burro interest groups, wildlife 

or hunting organizations, or watershed associations. 

‘‘(C) 5 persons that— 

‘‘(i) hold State elected office (or a designee); 

‘‘(ii) hold county or local elected office; 

‘‘(iii) represent American Indian tribes 

within or adjacent to the area for which the 

committee is organized; 

‘‘(iv) are school officials or teachers; or 

‘‘(v) represent the affected public at large. 

‘‘(3) BALANCED REPRESENTATION.—In appointing committee members from the 3 categories in paragraph (2), the Secretary concerned shall provide for balanced and broad 

representation from within each category. 

‘‘(4) GEOGRAPHIC DISTRIBUTION.—The members of a resource advisory committee shall 

reside within the State in which the committee has jurisdiction and, to extent practicable, the Secretary concerned shall ensure 

local representation in each category in 

paragraph (2). 

‘‘(5) CHAIRPERSON.—A majority on each resource advisory committee shall select the 

chairperson of the committee. 

‘‘(e) APPROVAL PROCEDURES.— 

‘‘(1) IN GENERAL.—Subject to paragraph (3), 

each resource advisory committee shall establish procedures for proposing projects to 

the Secretary concerned under this title. 

‘‘(2) QUORUM.—A quorum must be present 

to constitute an official meeting of the committee. 

‘‘(3) APPROVAL BY MAJORITY OF MEMBERS.— 

A project may be proposed by a resource advisory committee to the Secretary concerned under section 203(a), if the project has 

been approved by a majority of members of 

the committee from each of the 3 categories 

in subsection (d)(2). 

‘‘(f) OTHER COMMITTEE AUTHORITIES AND

REQUIREMENTS.— 

‘‘(1) STAFF ASSISTANCE.—A resource advisory committee may submit to the Secretary 

concerned a request for periodic staff assistance from Federal employees under the jurisdiction of the Secretary. 

‘‘(2) MEETINGS.—All meetings of a resource 

advisory committee shall be announced at 

least 1 week in advance in a local newspaper 

of record and shall be open to the public. 

‘‘(3) RECORDS.—A resource advisory committee shall maintain records of the meetings of the committee and make the records 

available for public inspection. 

‘‘SEC. 206. USE OF PROJECT FUNDS. 

‘‘(a) AGREEMENT REGARDING SCHEDULE AND

COST OF PROJECT.— 

‘‘(1) AGREEMENT BETWEEN PARTIES.—The 

Secretary concerned may carry out a project 

submitted by a resource advisory committee 

under section 203(a) using project funds or 

other funds described in section 203(a)(2), if, 

as soon as practicable after the issuance of a 

decision document for the project and the exhaustion of all administrative appeals and 

judicial review of the project decision, the 

Secretary concerned and the resource advisory committee enter into an agreement addressing, at a minimum, the following: 

‘‘(A) The schedule for completing the 

project. 

‘‘(B) The total cost of the project, including the level of agency overhead to be assessed against the project. 

‘‘(C) For a multiyear project, the estimated cost of the project for each of the fiscal years in which it will be carried out. 

‘‘(D) The remedies for failure of the Secretary concerned to comply with the terms 

of the agreement consistent with current 

Federal law. 

‘‘(2) LIMITED USE OF FEDERAL FUNDS.—The 

Secretary concerned may decide, at the sole 

discretion of the Secretary concerned, to 

cover the costs of a portion of an approved 

project using Federal funds appropriated or 

otherwise available to the Secretary for the 

same purposes as the project. 

‘‘(b) TRANSFER OF PROJECT FUNDS.— 

‘‘(1) INITIAL TRANSFER REQUIRED.—As soon 

as practicable after the agreement is reached 

under subsection (a) with regard to a project 

to be funded in whole or in part using project 

funds, or other funds described in section 

203(a)(2), the Secretary concerned shall 

transfer to the applicable unit of National 

Forest System land or Bureau of Land Management District an amount of project funds 

equal to— 

‘‘(A) in the case of a project to be completed in a single fiscal year, the total 


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amount specified in the agreement to be paid 

using project funds, or other funds described 

in section 203(a)(2); or 

‘‘(B) in the case of a multiyear project, the 

amount specified in the agreement to be paid 

using project funds, or other funds described 

in section 203(a)(2) for the first fiscal year. 

‘‘(2) CONDITION ON PROJECT COMMENCEMENT.—The unit of National Forest System 

land or Bureau of Land Management District 

concerned, shall not commence a project 

until the project funds, or other funds described in section 203(a)(2) required to be 

transferred under paragraph (1) for the 

project, have been made available by the 

Secretary concerned. 

‘‘(3) SUBSEQUENT TRANSFERS FOR

MULTIYEAR PROJECTS.— 

‘‘(A) IN GENERAL.—For the second and subsequent fiscal years of a multiyear project to 

be funded in whole or in part using project 

funds, the unit of National Forest System 

land or Bureau of Land Management District 

concerned shall use the amount of project 

funds required to continue the project in 

that fiscal year according to the agreement 

entered into under subsection (a). 

‘‘(B) SUSPENSION OF WORK.—The Secretary 

concerned shall suspend work on the project 

if the project funds required by the agreement in the second and subsequent fiscal 

years are not available. 

‘‘SEC. 207. AVAILABILITY OF PROJECT FUNDS. 

‘‘(a) SUBMISSION OF PROPOSED PROJECTS TO

OBLIGATE FUNDS.—By September 30, 2008 (or 

as soon thereafter as the Secretary concerned determines is practicable), and each 

September 30 thereafter for each succeeding 

fiscal year through fiscal year 2011, a resource advisory committee shall submit to 

the Secretary concerned pursuant to section 

203(a)(1) a sufficient number of project proposals that, if approved, would result in the 

obligation of at least the full amount of the 

project funds reserved by the participating 

county in the preceding fiscal year. 

‘‘(b) USE OR TRANSFER OF UNOBLIGATED

FUNDS.—Subject to section 208, if a resource 

advisory committee fails to comply with 

subsection (a) for a fiscal year, any project 

funds reserved by the participating county in 

the preceding fiscal year and remaining unobligated shall be available for use as part of 

the project submissions in the next fiscal 

year. 

‘‘(c) EFFECT OF REJECTION OF PROJECTS.— 

Subject to section 208, any project funds reserved by a participating county in the preceding fiscal year that are unobligated at the 

end of a fiscal year because the Secretary 

concerned has rejected one or more proposed 

projects shall be available for use as part of 

the project submissions in the next fiscal 

year. 

‘‘(d) EFFECT OF COURT ORDERS.— 

‘‘(1) IN GENERAL.—If an approved project 

under this Act is enjoined or prohibited by a 

Federal court, the Secretary concerned shall 

return the unobligated project funds related 

to the project to the participating county or 

counties that reserved the funds. 

‘‘(2) EXPENDITURE OF FUNDS.—The returned 

funds shall be available for the county to expend in the same manner as the funds reserved by the county under subparagraph (B) 

or (C)(i) of section 102(d)(1). 

‘‘SEC. 208. TERMINATION OF AUTHORITY. 

‘‘(a) IN GENERAL.—The authority to initiate projects under this title shall terminate on September 30, 2011. 

‘‘(b) DEPOSITS IN TREASURY.—Any project 

funds not obligated by September 30, 2012, 

shall be deposited in the Treasury of the 

United States. 

‘‘TITLE III—COUNTY FUNDS 

‘‘SEC. 301. DEFINITIONS. 

‘‘In this title: 

‘‘(1) COUNTY FUNDS.—The term ‘county 

funds’ means all funds an eligible county 

elects under section 102(d) to reserve for expenditure in accordance with this title. 

‘‘(2) PARTICIPATING COUNTY.—The term 

‘participating county’ means an eligible 

county that elects under section 102(d) to expend a portion of the Federal funds received 

under section 102 in accordance with this 

title. 

‘‘SEC. 302. USE. 

‘‘(a) AUTHORIZED USES.—A participating 

county, including any applicable agencies of 

the participating county, shall use county 

funds, in accordance with this title, only— 

‘‘(1) to carry out activities under the 

Firewise Communities program to provide to 

homeowners in fire-sensitive ecosystems 

education on, and assistance with implementing, techniques in home siting, home 

construction, and home landscaping that can 

increase the protection of people and property from wildfires; 

‘‘(2) to reimburse the participating county 

for search and rescue and other emergency 

services, including firefighting, that are— 

‘‘(A) performed on Federal land after the 

date on which the use was approved under 

subsection (b); 

‘‘(B) paid for by the participating county; 

and 

‘‘(3) to develop community wildfire protection plans in coordination with the appropriate Secretary concerned. 

‘‘(b) PROPOSALS.—A participating county 

shall use county funds for a use described in 

subsection (a) only after a 45-day public comment period, at the beginning of which the 

participating county shall— 

‘‘(1) publish in any publications of local 

record a proposal that describes the proposed 

use of the county funds; and 

‘‘(2) submit the proposal to any resource 

advisory committee established under section 205 for the participating county. 

‘‘SEC. 303. CERTIFICATION. 

‘‘(a) IN GENERAL.—Not later than February 

1 of the year after the year in which any 

county funds were expended by a participating county, the appropriate official of the 

participating county shall submit to the Secretary concerned a certification that the 

county funds expended in the applicable year 

have been used for the uses authorized under 

section 302(a), including a description of the 

amounts expended and the uses for which the 

amounts were expended. 

‘‘(b) REVIEW.—The Secretary concerned 

shall review the certifications submitted 

under subsection (a) as the Secretary concerned determines to be appropriate. 

‘‘SEC. 304. TERMINATION OF AUTHORITY. 

‘‘(a) IN GENERAL.—The authority to initiate projects under this title terminates on 

September 30, 2011. 

‘‘(b) AVAILABILITY.—Any county funds not 

obligated by September 30, 2012, shall be returned to the Treasury of the United States. 

‘‘TITLE IV—MISCELLANEOUS PROVISIONS 

‘‘SEC. 401. REGULATIONS. 

‘‘The Secretary of Agriculture and the Secretary of the Interior shall issue regulations 

to carry out the purposes of this Act. 

‘‘SEC. 402. AUTHORIZATION OF APPROPRIATIONS. 

‘‘There are authorized to be appropriated 

such sums as are necessary to carry out this 

Act for each of fiscal years 2008 through 2011. 

‘‘SEC. 403. TREATMENT OF FUNDS AND REVENUES. 

‘‘(a) RELATION TO OTHER APPROPRIATIONS.— 

Funds made available under section 402 and 

funds made available to a Secretary concerned under section 206 shall be in addition 

to any other annual appropriations for the 

Forest Service and the Bureau of Land Management. 

‘‘(b) DEPOSIT OF REVENUES AND OTHER

FUNDS.—All revenues generated from 

projects pursuant to title II, including any 

interest accrued from the revenues, shall be 

deposited in the Treasury of the United 

States.’’. 

(b) FOREST RECEIPT PAYMENTS TO ELIGIBLE

STATES AND COUNTIES.— 

(1) ACT OF MAY 23, 1908.—The sixth paragraph under the heading ‘‘FOREST SERVICE’’ in the Act of May 23, 1908 (16 U.S.C. 500) 

is amended in the first sentence by striking 

‘‘twenty-five percentum’’ and all that follows through ‘‘shall be paid’’ and inserting 

the following: ‘‘an amount equal to the annual average of 25 percent of all amounts received for the applicable fiscal year and each 

of the preceding 6 fiscal years from each national forest shall be paid’’. 

(2) WEEKS LAW.—Section 13 of the Act of 

March 1, 1911 (commonly known as the 

‘‘Weeks Law’’) (16 U.S.C. 500) is amended in 

the first sentence by striking ‘‘twenty-five 

percentum’’ and all that follows through 

‘‘shall be paid’’ and inserting the following: 

‘‘an amount equal to the annual average of 

25 percent of all amounts received for the applicable fiscal year and each of the preceding 

6 fiscal years from each national forest shall 

be paid’’. 

(c) PAYMENTS IN LIEU OF TAXES.— 

(1) IN GENERAL.—Section 6906 of title 31, 

United States Code, is amended to read as 

follows: 

‘‘§ 6906. Funding 

‘‘For each of fiscal years 2008 through 

2012— 

‘‘(1) each county or other eligible unit of 

local government shall be entitled to payment under this chapter; and 

‘‘(2) sums shall be made available to the 

Secretary of the Interior for obligation or 

expenditure in accordance with this chapter.’’. 

(2) CONFORMING AMENDMENT.—The table of 

sections for chapter 69 of title 31, United 

States Code, is amended by striking the item 

relating to section 6906 and inserting the following: 

‘‘6906. Funding.’’. 

(3) BUDGET SCOREKEEPING.— 

(A) IN GENERAL.—Notwithstanding the 

Budget Scorekeeping Guidelines and the accompanying list of programs and accounts 

set forth in the joint explanatory statement 

of the committee of conference accompanying Conference Report 105–217, the section in this title regarding Payments in Lieu 

of Taxes shall be treated in the baseline for 

purposes of section 257 of the Balanced Budget and Emergency Deficit Control Act of 1985 

(as in effect prior to September 30, 2002), and 

by the Chairmen of the House and Senate 

Budget Committees, as appropriate, for purposes of budget enforcement in the House 

and Senate, and under the Congressional 

Budget Act of 1974 as if Payment in Lieu of 

Taxes (14–1114–0–1–806) were an account designated as Appropriated Entitlements and 

Mandatories for Fiscal Year 1997 in the joint 

explanatory statement of the committee of 

conference accompanying Conference Report 

105–217. 

(B) EFFECTIVE DATE.—This paragraph shall 

remain in effect for the fiscal years to which 

the entitlement in section 6906 of title 31, 

United States Code (as amended by paragraph (1)), applies. 

SEC. 602. TRANSFER TO ABANDONED MINE RECLAMATION FUND. 

Subparagraph (C) of section 402(i)(1) of the 

Surface Mining Control and Reclamation 

Act of 1977 (30 U.S.C. 1232(i)(1)) is amended by 

striking ‘‘and $9,000,000 on October 1, 2009’’ 

and inserting ‘‘$9,000,000 on October 1, 2009, 

and $9,000,000 on October 1, 2010’’. 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10381 

TITLE VII—DISASTER RELIEF 

Subtitle A—Heartland and Hurricane Ike 

Disaster Relief 

SEC. 701. SHORT TITLE. 

This subtitle may be cited as the ‘‘Heartland Disaster Tax Relief Act of 2008’’. 

SEC. 702. TEMPORARY TAX RELIEF FOR AREAS 

DAMAGED BY 2008 MIDWESTERN SEVERE STORMS, TORNADOS, AND 

FLOODING. 

(a) IN GENERAL.—Subject to the modifications described in this section, the following 

provisions of or relating to the Internal Revenue Code of 1986 shall apply to any Midwestern disaster area in addition to the 

areas to which such provisions otherwise 

apply: 

(1) GO ZONE BENEFITS.— 

(A) Section 1400N (relating to tax benefits) 

other than subsections (b), (d), (e), (i), (j), 

(m), and (o) thereof. 

(B) Section 1400O (relating to education 

tax benefits). 

(C) Section 1400P (relating to housing tax 

benefits). 

(D) Section 1400Q (relating to special rules 

for use of retirement funds). 

(E) Section 1400R(a) (relating to employee 

retention credit for employers). 

(F) Section 1400S (relating to additional 

tax relief) other than subsection (d) thereof. 

(G) Section 1400T (relating to special rules 

for mortgage revenue bonds). 

(2) OTHER BENEFITS INCLUDED IN KATRINA

EMERGENCY TAX RELIEF ACT OF 2005.—Sections 

302, 303, 304, 401, and 405 of the Katrina Emergency Tax Relief Act of 2005. 

(b) MIDWESTERN DISASTER AREA.— 

(1) IN GENERAL.—For purposes of this section and for applying the substitutions described in subsections (d) and (e), the term 

‘‘Midwestern disaster area’’ means an area— 

(A) with respect to which a major disaster 

has been declared by the President on or 

after May 20, 2008, and before August 1, 2008, 

under section 401 of the Robert T. Stafford 

Disaster Relief and Emergency Assistance 

Act by reason of severe storms, tornados, or 

flooding occurring in any of the States of Arkansas, Illinois, Indiana, Iowa, Kansas, 

Michigan, Minnesota, Missouri, Nebraska, 

and Wisconsin, and 

(B) determined by the President to warrant 

individual or individual and public assistance from the Federal Government under 

such Act with respect to damages attributable to such severe storms, tornados, or 

flooding. 

(2) CERTAIN BENEFITS AVAILABLE TO AREAS

ELIGIBLE ONLY FOR PUBLIC ASSISTANCE.—For 

purposes of applying this section to benefits 

under the following provisions, paragraph (1) 

shall be applied without regard to subparagraph (B): 

(A) Sections 1400Q, 1400S(b), and 1400S(d) of 

the Internal Revenue Code of 1986. 

(B) Sections 302, 401, and 405 of the Katrina 

Emergency Tax Relief Act of 2005. 

(c) REFERENCES.— 

(1) AREA.—Any reference in such provisions 

to the Hurricane Katrina disaster area or the 

Gulf Opportunity Zone shall be treated as a 

reference to any Midwestern disaster area 

and any reference to the Hurricane Katrina 

disaster area or the Gulf Opportunity Zone 

within a State shall be treated as a reference 

to all Midwestern disaster areas within the 

State. 

(2) ITEMS ATTRIBUTABLE TO DISASTER.—Any 

reference in such provisions to any loss, 

damage, or other item attributable to Hurricane Katrina shall be treated as a reference 

to any loss, damage, or other item attributable to the severe storms, tornados, or 

flooding giving rise to any Presidential declaration described in subsection (b)(1)(A). 

(3) APPLICABLE DISASTER DATE.—For purposes of applying the substitutions described 

in subsections (d) and (e), the term ‘‘applicable disaster date’’ means, with respect to any 

Midwestern disaster area, the date on which 

the severe storms, tornados, or flooding giving rise to the Presidential declaration described in subsection (b)(1)(A) occurred. 

(d) MODIFICATIONS TO 1986 CODE.—The following provisions of the Internal Revenue 

Code of 1986 shall be applied with the following modifications: 

(1) TAX-EXEMPT BOND FINANCING.—Section 

1400N(a)— 

(A) by substituting ‘‘qualified Midwestern 

disaster area bond’’ for ‘‘qualified Gulf Opportunity Zone Bond’’ each place it appears, 

except that in determining whether a bond is 

a qualified Midwestern disaster area bond— 

(i) paragraph (2)(A)(i) shall be applied by 

only treating costs as qualified project costs 

if— 

(I) in the case of a project involving a private business use (as defined in section 

141(b)(6)), either the person using the property suffered a loss in a trade or business attributable to the severe storms, tornados, or 

flooding giving rise to any Presidential declaration described in subsection (b)(1)(A) or 

is a person designated for purposes of this 

section by the Governor of the State in 

which the project is located as a person carrying on a trade or business replacing a 

trade or business with respect to which another person suffered such a loss, and 

(II) in the case of a project relating to public utility property, the project involves repair or reconstruction of public utility property damaged by such severe storms, tornados, or flooding, and 

(ii) paragraph (2)(A)(ii) shall be applied by 

treating an issue as a qualified mortgage 

issue only if 95 percent or more of the net 

proceeds (as defined in section 150(a)(3)) of 

the issue are to be used to provide financing 

for mortgagors who suffered damages to 

their principal residences attributable to 

such severe storms, tornados, or flooding, 

(B) by substituting ‘‘any State in which a 

Midwestern disaster area is located’’ for ‘‘the 

State of Alabama, Louisiana, or Mississippi’’ 

in paragraph (2)(B), 

(C) by substituting ‘‘designated for purposes of this section (on the basis of providing assistance to areas in the order in 

which such assistance is most needed)’’ for 

‘‘designated for purposes of this section’’ in 

paragraph (2)(C), 

(D) by substituting ‘‘January 1, 2013’’ for 

‘‘January 1, 2011’’ in paragraph (2)(D), 

(E) in paragraph (3)(A)— 

(i) by substituting ‘‘$1,000’’ for ‘‘$2,500’’, 

and 

(ii) by substituting ‘‘before the earliest applicable disaster date for Midwestern disaster areas within the State’’ for ‘‘before August 28, 2005’’, 

(F) by substituting ‘‘qualified Midwestern 

disaster area repair or construction’’ for 

‘‘qualified GO Zone repair or construction’’ 

each place it appears, 

(G) by substituting ‘‘after the date of the 

enactment of the Heartland Disaster Tax Relief Act of 2008 and before January 1, 2013’’ 

for ‘‘after the date of the enactment of this 

paragraph and before January 1, 2011’’ in 

paragraph (7)(C), and 

(H) by disregarding paragraph (8) thereof. 

(2) LOW-INCOME HOUSING CREDIT.—Section 

1400N(c)— 

(A) only with respect to calendar years 

2008, 2009, and 2010, 

(B) by substituting ‘‘Disaster Recovery Assistance housing amount’’ for ‘‘Gulf Opportunity housing amount’’ each place it appears, 

(C) in paragraph (1)(B)— 

(i) by substituting ‘‘$8.00’’ for ‘‘$18.00’’, and 

(ii) by substituting ‘‘before the earliest applicable disaster date for Midwestern disaster areas within the State’’ for ‘‘before August 28, 2005’’ , and 

(D) determined without regard to paragraphs (2), (3), (4), (5), and (6) thereof. 

(3) EXPENSING FOR CERTAIN DEMOLITION AND

CLEAN-UP COSTS.—Section 1400N(f)— 

(A) by substituting ‘‘qualified Disaster Recovery Assistance clean-up cost’’ for ‘‘qualified Gulf Opportunity Zone clean-up cost’’ 

each place it appears, 

(B) by substituting ‘‘beginning on the applicable disaster date and ending on December 31, 2010’’ for ‘‘beginning on August 28, 

2005, and ending on December 31, 2007’’ in 

paragraph (2), and 

(C) by treating costs as qualified Disaster 

Recovery Assistance clean-up costs only if 

the removal of debris or demolition of any 

structure was necessary due to damage attributable to the severe storms, tornados, or 

flooding giving rise to any Presidential declaration described in subsection (b)(1)(A). 

(4) EXTENSION OF EXPENSING FOR ENVIRONMENTAL REMEDIATION COSTS.—Section 

1400N(g)— 

(A) by substituting ‘‘the applicable disaster date’’ for ‘‘August 28, 2005’’ each place 

it appears, 

(B) by substituting ‘‘January 1, 2011’’ for 

‘‘January 1, 2008’’ in paragraph (1), 

(C) by substituting ‘‘December 31, 2010’’ for 

‘‘December 31, 2007’’ in paragraph (1), and 

(D) by treating a site as a qualified contaminated site only if the release (or threat 

of release) or disposal of a hazardous substance at the site was attributable to the severe storms, tornados, or flooding giving rise 

to any Presidential declaration described in 

subsection (b)(1)(A). 

(5) INCREASE IN REHABILITATION CREDIT.— 

Section 1400N(h), as amended by this Act— 

(A) by substituting ‘‘the applicable disaster date’’ for ‘‘August 28, 2005’’, 

(B) by substituting ‘‘December 31, 2011’’ for 

‘‘December 31, 2009’’ in paragraph (1), and 

(C) by only applying such subsection to 

qualified rehabilitation expenditures with 

respect to any building or structure which 

was damaged or destroyed as a result of the 

severe storms, tornados, or flooding giving 

rise to any Presidential declaration described in subsection (b)(1)(A). 

(6) TREATMENT OF NET OPERATING LOSSES

ATTRIBUTABLE TO DISASTER LOSSES.—Section 

1400N(k)— 

(A) by substituting ‘‘qualified Disaster Recovery Assistance loss’’ for ‘‘qualified Gulf 

Opportunity Zone loss’’ each place it appears, 

(B) by substituting ‘‘after the day before 

the applicable disaster date, and before January 1, 2011’’ for ‘‘after August 27, 2005, and 

before January 1, 2008’’ each place it appears, 

(C) by substituting ‘‘the applicable disaster 

date’’ for ‘‘August 28, 2005’’ in paragraph 

(2)(B)(ii)(I), 

(D) by substituting ‘‘qualified Disaster Recovery Assistance property’’ for ‘‘qualified 

Gulf Opportunity Zone property’’ in paragraph (2)(B)(iv), and 

(E) by substituting ‘‘qualified Disaster Recovery Assistance casualty loss’’ for ‘‘qualified Gulf Opportunity Zone casualty loss’’ 

each place it appears. 

(7) CREDIT TO HOLDERS OF TAX CREDIT

BONDS.—Section 1400N(l)— 

(A) by substituting ‘‘Midwestern tax credit 

bond’’ for ‘‘Gulf tax credit bond’’ each place 

it appears, 

(B) by substituting ‘‘any State in which a 

Midwestern disaster area is located or any 

instrumentality of the State’’ for ‘‘the State 

of Alabama, Louisiana, or Mississippi’’ in 

paragraph (4)(A)(i), 

(C) by substituting ‘‘after December 31, 

2008 and before January 1, 2010’’ for ‘‘after 

December 31, 2005, and before January 1, 

2007’’, 


smartinez on PROD1PC64 with SENATE
S10382 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(D) by substituting ‘‘shall not exceed 

$100,000,000 for any State with an aggregate 

population located in all Midwestern disaster areas within the State of at least 

2,000,000, $50,000,000 for any State with an aggregate population located in all Midwestern 

disaster areas within the State of at least 

1,000,000 but less than 2,000,000, and zero for 

any other State. The population of a State 

within any area shall be determined on the 

basis of the most recent census estimate of 

resident population released by the Bureau 

of Census before the earliest applicable disaster date for Midwestern disaster areas 

within the State.’’ for ‘‘shall not exceed’’ and 

all that follows in paragraph (4)(C), and 

(E) by substituting ‘‘the earliest applicable 

disaster date for Midwestern disaster areas 

within the State’’ for ‘‘August 28, 2005’’ in 

paragraph (5)(A). 

(8) EDUCATION TAX BENEFITS.—Section 

1400O, by substituting ‘‘2008 or 2009’’ for ‘‘2005 

or 2006’’. 

(9) HOUSING TAX BENEFITS.—Section 1400P, 

by substituting ‘‘the applicable disaster 

date’’ for ‘‘August 28, 2005’’ in subsection 

(c)(1). 

(10) SPECIAL RULES FOR USE OF RETIREMENT

FUNDS.—Section 1400Q— 

(A) by substituting ‘‘qualified Disaster Recovery Assistance distribution’’ for ‘‘qualified hurricane distribution’’ each place it appears, 

(B) by substituting ‘‘on or after the applicable disaster date and before January 1, 

2010’’ for ‘‘on or after August 25, 2005, and before January 1, 2007’’ in subsection 

(a)(4)(A)(i), 

(C) by substituting ‘‘the applicable disaster 

date’’ for ‘‘August 28, 2005’’ in subsections 

(a)(4)(A)(i) and (c)(3)(B), 

(D) by disregarding clauses (ii) and (iii) of 

subsection (a)(4)(A) thereof, 

(E) by substituting ‘‘qualified storm damage distribution’’ for ‘‘qualified Katrina distribution’’ each place it appears, 

(F) by substituting ‘‘after the date which is 

6 months before the applicable disaster date 

and before the date which is the day after 

the applicable disaster date’’ for ‘‘after February 28, 2005, and before August 29, 2005’’ in 

subsection (b)(2)(B)(ii), 

(G) by substituting ‘‘the Midwestern disaster area, but not so purchased or constructed on account of severe storms, tornados, or flooding giving rise to the designation of the area as a disaster area’’ for ‘‘the 

Hurricane Katrina disaster area, but not so 

purchased or constructed on account of Hurricane Katrina’’ in subsection (b)(2)(B)(iii), 

(H) by substituting ‘‘beginning on the applicable disaster date and ending on the date 

which is 5 months after the date of the enactment of the Heartland Disaster Tax Relief 

Act of 2008’’ for ‘‘beginning on August 25, 

2005, and ending on February 28, 2006’’ in subsection (b)(3)(A), 

(I) by substituting ‘‘qualified storm damage individual’’ for ‘‘qualified Hurricane 

Katrina individual’’ each place it appears, 

(J) by substituting ‘‘December 31, 2009’’ for 

‘‘December 31, 2006’’ in subsection (c)(2)(A), 

(K) by disregarding subparagraphs (C) and 

(D) of subsection (c)(3) thereof, 

(L) by substituting ‘‘beginning on the date 

of the enactment of the Heartland Disaster 

Tax Relief Act of 2008 and ending on December 31, 2009’’ for ‘‘beginning on September 24, 

2005, and ending on December 31, 2006’’ in 

subsection (c)(4)(A)(i), 

(M) by substituting ‘‘the applicable disaster date’’ for ‘‘August 25, 2005’’ in subsection (c)(4)(A)(ii), and 

(N) by substituting ‘‘January 1, 2010’’ for 

‘‘January 1, 2007’’ in subsection (d)(2)(A)(ii). 

(11) EMPLOYEE RETENTION CREDIT FOR EMPLOYERS AFFECTED BY SEVERE STORMS, TORNADOS, AND FLOODING.—Section 1400R(a)— 

(A) by substituting ‘‘the applicable disaster date’’ for ‘‘August 28, 2005’’ each place 

it appears, 

(B) by substituting ‘‘January 1, 2009’’ for 

‘‘January 1, 2006’’ both places it appears, and 

(C) only with respect to eligible employers 

who employed an average of not more than 

200 employees on business days during the 

taxable year before the applicable disaster 

date. 

(12) TEMPORARY SUSPENSION OF LIMITATIONS

ON CHARITABLE CONTRIBUTIONS.—Section 

1400S(a), by substituting the following paragraph for paragraph (4) thereof: 

‘‘(4) QUALIFIED CONTRIBUTIONS.— 

‘‘(A) IN GENERAL.—For purposes of this subsection, the term ‘qualified contribution’ 

means any charitable contribution (as defined in section 170(c)) if— 

‘‘(i) such contribution— 

‘‘(I) is paid during the period beginning on 

the earliest applicable disaster date for all 

States and ending on December 31, 2008, in 

cash to an organization described in section 

170(b)(1)(A), and 

‘‘(II) is made for relief efforts in 1 or more 

Midwestern disaster areas, 

‘‘(ii) the taxpayer obtains from such organization contemporaneous written acknowledgment (within the meaning of section 

170(f)(8)) that such contribution was used (or 

is to be used) for relief efforts in 1 or more 

Midwestern disaster areas, and 

‘‘(iii) the taxpayer has elected the application of this subsection with respect to such 

contribution. 

‘‘(B) EXCEPTION.—Such term shall not include a contribution by a donor if the contribution is— 

‘‘(i) to an organization described in section 

509(a)(3), or 

‘‘(ii) for establishment of a new, or maintenance of an existing, donor advised fund (as 

defined in section 4966(d)(2)). 

‘‘(C) APPLICATION OF ELECTION TO PARTNERSHIPS AND S CORPORATIONS.—In the case of a 

partnership or S corporation, the election 

under subparagraph (A)(iii) shall be made 

separately by each partner or shareholder.’’. 

(13) SUSPENSION OF CERTAIN LIMITATIONS ON

PERSONAL CASUALTY LOSSES.—Section 

1400S(b)(1), by substituting ‘‘the applicable 

disaster date’’ for ‘‘August 25, 2005’’. 

(14) SPECIAL RULE FOR DETERMINING EARNED

INCOME.—Section 1400S(d)— 

(A) by treating an individual as a qualified 

individual if such individual’s principal place 

of abode on the applicable disaster date was 

located in a Midwestern disaster area, 

(B) by treating the applicable disaster date 

with respect to any such individual as the 

applicable date for purposes of such subsection, and 

(C) by treating an area as described in 

paragraph (2)(B)(ii) thereof if the area is a 

Midwestern disaster area only by reason of 

subsection (b)(2) of this section (relating to 

areas eligible only for public assistance). 

(15) ADJUSTMENTS REGARDING TAXPAYER

AND DEPENDENCY STATUS.—Section 1400S(e), 

by substituting ‘‘2008 or 2009’’ for ‘‘2005 or 

2006’’. 

(e) MODIFICATIONS TO KATRINA EMERGENCY

TAX RELIEF ACT OF 2005.—The following provisions of the Katrina Emergency Tax Relief 

Act of 2005 shall be applied with the following modifications: 

(1) ADDITIONAL EXEMPTION FOR HOUSING DISPLACED INDIVIDUAL.—Section 302— 

(A) by substituting ‘‘2008 or 2009’’ for ‘‘2005 

or 2006’’ in subsection (a) thereof, 

(B) by substituting ‘‘Midwestern displaced 

individual’’ for ‘‘Hurricane Katrina displaced 

individual’’ each place it appears, and 

(C) by treating an area as a core disaster 

area for purposes of applying subsection (c) 

thereof if the area is a Midwestern disaster 

area without regard to subsection (b)(2) of 

this section (relating to areas eligible only 

for public assistance). 

(2) INCREASE IN STANDARD MILEAGE RATE.— 

Section 303, by substituting ‘‘beginning on 

the applicable disaster date and ending on 

December 31, 2008’’ for ‘‘beginning on August 

25, 2005, and ending on December 31, 2006’’. 

(3) MILEAGE REIMBURSEMENTS FOR CHARITABLE VOLUNTEERS.—Section 304— 

(A) by substituting ‘‘beginning on the applicable disaster date and ending on December 31, 2008’’ for ‘‘beginning on August 25, 

2005, and ending on December 31, 2006’’ in 

subsection (a), and 

(B) by substituting ‘‘the applicable disaster 

date’’ for ‘‘August 25, 2005’’ in subsection (a). 

(4) EXCLUSION OF CERTAIN CANCELLATION OF

INDEBTEDNESS INCOME.—Section 401— 

(A) by treating an individual whose principal place of abode on the applicable disaster date was in a Midwestern disaster area 

(determined without regard to subsection 

(b)(2) of this section) as an individual described in subsection (b)(1) thereof, and by 

treating an individual whose principal place 

of abode on the applicable disaster date was 

in a Midwestern disaster area solely by reason of subsection (b)(2) of this section as an 

individual described in subsection (b)(2) 

thereof, 

(B) by substituting ‘‘the applicable disaster 

date’’ for ‘‘August 28, 2005’’ both places it appears, and 

(C) by substituting ‘‘January 1, 2010’’ for 

‘‘January 1, 2007’’ in subsection (e). 

(5) EXTENSION OF REPLACEMENT PERIOD FOR

NONRECOGNITION OF GAIN.—Section 405, by 

substituting ‘‘on or after the applicable disaster date’’ for ‘‘on or after August 25, 2005’’. 

SEC. 703. REPORTING REQUIREMENTS RELATING 

TO DISASTER RELIEF CONTRIBUTIONS. 

(a) IN GENERAL.—Section 6033(b) (relating 

to returns of certain organizations described 

in section 501(c)(3)) is amended by striking 

‘‘and’’ at the end of paragraph (13), by redesignating paragraph (14) as paragraph (15), 

and by adding after paragraph (13) the following new paragraph: 

‘‘(14) such information as the Secretary 

may require with respect to disaster relief 

activities, including the amount and use of 

qualified contributions to which section 

1400S(a) applies, and’’. 

(b) EFFECTIVE DATE.—The amendments 

made by this section shall apply to returns 

the due date for which (determined without 

regard to any extension) occurs after December 31, 2008. 

SEC. 704. TEMPORARY TAX-EXEMPT BOND FINANCING AND LOW-INCOME HOUSING TAX RELIEF FOR AREAS DAMAGED BY HURRICANE IKE. 

(a) TAX-EXEMPT BOND FINANCING.—Section 

1400N(a) of the Internal Revenue Code of 1986 

shall apply to any Hurricane Ike disaster 

area in addition to any other area referenced 

in such section, but with the following modifications: 

(1) By substituting ‘‘qualified Hurricane 

Ike disaster area bond’’ for ‘‘qualified Gulf 

Opportunity Zone Bond’’ each place it appears, except that in determining whether a 

bond is a qualified Hurricane Ike disaster 

area bond— 

(A) paragraph (2)(A)(i) shall be applied by 

only treating costs as qualified project costs 

if— 

(i) in the case of a project involving a private business use (as defined in section 

141(b)(6)), either the person using the property suffered a loss in a trade or business attributable to Hurricane Ike or is a person 

designated for purposes of this section by the 

Governor of the State in which the project is 

located as a person carrying on a trade or 

business replacing a trade or business with 

respect to which another person suffered 

such a loss, and 


smartinez on PROD1PC64 with SENATE
October 1, 2008 CONGRESSIONAL RECORD — SENATE S10383 

(ii) in the case of a project relating to public utility property, the project involves repair or reconstruction of public utility property damaged by Hurricane Ike, and 

(B) paragraph (2)(A)(ii) shall be applied by 

treating an issue as a qualified mortgage 

issue only if 95 percent or more of the net 

proceeds (as defined in section 150(a)(3)) of 

the issue are to be used to provide financing 

for mortgagors who suffered damages to 

their principal residences attributable to 

Hurricane Ike. 

(2) By substituting ‘‘any State in which 

any Hurricane Ike disaster area is located’’ 

for ‘‘the State of Alabama, Louisiana, or 

Mississippi’’ in paragraph (2)(B). 

(3) By substituting ‘‘designated for purposes of this section (on the basis of providing assistance to areas in the order in 

which such assistance is most needed)’’ for 

‘‘designated for purposes of this section’’ in 

paragraph (2)(C). 

(4) By substituting ‘‘January 1, 2013’’ for 

‘‘January 1, 2011’’ in paragraph (2)(D). 

(5) By substituting the following for subparagraph (A) of paragraph (3): 

‘‘(A) AGGREGATE AMOUNT DESIGNATED.—The 

maximum aggregate face amount of bonds 

which may be designated under this subsection with respect to any State shall not 

exceed the product of $2,000 multiplied by the 

portion of the State population which is in— 

‘‘(i) in the case of Texas, the counties of 

Brazoria, Chambers, Galveston, Jefferson, 

and Orange, and 

‘‘(ii) in the case of Louisiana, the parishes 

of Calcasieu and Cameron, 

(as determined on the basis of the most recent census estimate of resident population 

released by the Bureau of Census before September 13, 2008).’’. 

(6) By substituting ‘‘qualified Hurricane 

Ike disaster area repair or construction’’ for 

‘‘qualified GO Zone repair or construction’’ 

each place it appears. 

(7) By substituting ‘‘after the date of the 

enactment of the Heartland Disaster Tax Relief Act of 2008 and before January 1, 2013’’ 

for ‘‘after the date of the enactment of this 

paragraph and before January 1, 2011’’ in 

paragraph (7)(C). 

(8) By disregarding paragraph (8) thereof. 

(9) By substituting ‘‘any Hurricane Ike disaster area’’ for ‘‘the Gulf Opportunity Zone’’ 

each place it appears. 

(b) LOW-INCOME HOUSING CREDIT.—Section 

1400N(c) of the Internal Revenue Code of 1986 

shall apply to any Hurricane Ike disaster 

area in addition to any other area referenced 

in such section, but with the following modifications: 

(1) Only with respect to calendar years 

2008, 2009, and 2010. 

(2) By substituting ‘‘any Hurricane Ike disaster area’’ for ‘‘the Gulf Opportunity Zone’’ 

each place it appears. 

(3) By substituting ‘‘Hurricane Ike Recovery Assistance housing amount’’ for ‘‘Gulf 

Opportunity housing amount’’ each place it 

appears. 

(4) By substituting the following for subparagraph (B) of paragraph (1): 

‘‘(B) HURRICANE IKE HOUSING AMOUNT.—For 

purposes of subparagraph (A), the term ‘Hurricane Ike housing amount’ means, for any 

calendar year, the amount equal to the product of $16.00 multiplied by the portion of the 

State population which is in— 

‘‘(i) in the case of Texas, the counties of 

Brazoria, Chambers, Galveston, Jefferson, 

and Orange, and 

‘‘(ii) in the case of Louisiana, the parishes 

of Calcasieu and Cameron, 

(as determined on the basis of the most recent census estimate of resident population 

released by the Bureau of Census before September 13, 2008).’’. 

(5) Determined without regard to paragraphs (2), (3), (4), (5), and (6) thereof. 

(c) HURRICANE IKE DISASTER AREA.—For 

purposes of this section and for applying the 

substitutions described in subsections (a) 

and (b), the term ‘‘Hurricane Ike disaster 

area’’ means an area in the State of Texas or 

Louisiana— 

(1) with respect to which a major disaster 

has been declared by the President on September 13, 2008, under section 401 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act by reason of Hurricane 

Ike, and 

(2) determined by the President to warrant 

individual or individual and public assistance from the Federal Government under 

such Act with respect to damages attributable to Hurricane Ike. 

Subtitle B—National Disaster Relief 

SEC. 706. LOSSES ATTRIBUTABLE TO FEDERALLY 

DECLARED DISASTERS. 

(a) WAIVER OF ADJUSTED GROSS INCOME

LIMITATION.— 

(1) IN GENERAL.—Subsection (h) of section 

165 is amended by redesignating paragraphs 

(3) and (4) as paragraphs (4) and (5), respectively, and by inserting after paragraph (2) 

the following new paragraph: 

‘‘(3) SPECIAL RULE FOR LOSSES IN FEDERALLY DECLARED DISASTERS.— 

‘‘(A) IN GENERAL.—If an individual has a 

net disaster loss for any taxable year, the 

amount determined under paragraph 

(2)(A)(ii) shall be the sum of— 

‘‘(i) such net disaster loss, and 

‘‘(ii) so much of the excess referred to in 

the matter preceding clause (i) of paragraph 

(2)(A) (reduced by the amount in clause (i) of 

this subparagraph) as exceeds 10 percent of 

the adjusted gross income of the individual. 

‘‘(B) NET DISASTER LOSS.—For purposes of 

subparagraph (A), the term ‘net disaster loss’ 

means the excess of— 

‘‘(i) the personal casualty losses— 

‘‘(I) attributable to a federally declared 

disaster occurring before January 1, 2010, and 

‘‘(II) occurring in a disaster area, over 

‘‘(ii) personal casualty gains. 

‘‘(C) FEDERALLY DECLARED DISASTER.—For 

purposes of this paragraph— 

‘‘(i) FEDERALLY DECLARED DISASTER.—The 

term ‘federally declared disaster’ means any 

disaster subsequently determined by the 

President of the United States to warrant assistance by the Federal Government under 

the Robert T. Stafford Disaster Relief and 

Emergency Assistance Act. 

‘‘(ii) DISASTER AREA.—The term ‘disaster 

area’ means the area so determined to warrant such assistance.’’. 

(2) CONFORMING AMENDMENTS.— 

(A) Section 165(h)(4)(B) (as so redesignated) 

is amended by striking ‘‘paragraph (2)’’ and 

inserting ‘‘paragraphs (2) and (3)’’. 

(B) Section 165(i)(1) is amended by striking 

‘‘loss’’ and all that follows through ‘‘Act’’ 

and inserting ‘‘loss occurring in a disaster 

area (as defined by clause (ii) of subsection 

(h)(3)(C)) and attributable to a federally declared disaster (as defined by clause (i) of 

such subsection)’’. 

(C) Section 165(i)(4) is amended by striking 

‘‘Presidentially declared disaster (as defined 

by section 1033(h)(3))’’ and inserting ‘‘federally declared disaster (as defined by subsection (h)(3)(C)(i)’’. 

(D)(i) So much of subsection (h) of section 

1033 as precedes subparagraph (A) of paragraph (1) thereof is amended to read as follows: 

‘‘(h) SPECIAL RULES FOR PROPERTY DAMAGED BY FEDERALLY DECLARED DISASTERS.— 

‘‘(1) PRINCIPAL RESIDENCES.—If the taxpayer’s principal residence or any of its contents is located in a disaster area and is 

compulsorily or involuntarily converted as a 

result of a federally declared disaster—’’. 

(ii) Paragraph (2) of section 1033(h) is 

amended by striking ‘‘investment’’ and all 

that follows through ‘‘disaster’’ and inserting ‘‘investment located in a disaster area 

and compulsorily or involuntarily converted 

as a result of a federally declared disaster’’. 

(iii) Paragraph (3) of section 1033(h) is 

amended to read as follows: 

‘‘(3) FEDERALLY DECLARED DISASTER; DISASTER AREA.—The terms ‘‘federally declared 

disaster’’ and ‘‘disaster area’’ shall have the 

respective meaning given such terms by section 165(h)(3)(C).’’. 

(iv) Section 139(c)(2) is amended to read as 

follows: 

‘‘(2) federally declared disaster (as defined 

by section 165(h)(3)(C)(i)),’’. 

(v) Subclause (II) of section 172(b)(1)(F)(ii) 

is amended by striking ‘‘Presidentially declared disasters (as defined in section 

1033(h)(3))’’ and inserting ‘‘federally declared 

disasters (as defined by subsection 

(h)(3)(C)(i))’’. 

(vi) Subclause (III) of section 

172(b)(1)(F)(ii) is amended by striking ‘‘Presidentially declared disasters’’ and inserting 

‘‘federally declared disasters’’. 

(vii) Subsection (a) of section 7508A is 

amended by striking ‘‘Presidentially declared disaster (as defined in section 

1033(h)(3))’’ and inserting ‘‘federally declared 

disaster (as defined by section 

165(h)(3)(C)(i))’’. 

(b) INCREASE IN STANDARD DEDUCTION BY

DISASTER CASUALTY LOSS.— 

(1) IN GENERAL.—Paragraph (1) of section 

63(c), as amended by the Housing Assistance 

Tax Act of 2008, is amended by striking 

‘‘and’’ at the end of subparagraph (B), by 

striking the period at the end of subparagraph (C) and inserting ‘‘, and’’, and by adding at the end the following new subparagraph: 

‘‘(D) the disaster loss deduction.’’. 

(2) DISASTER LOSS DEDUCTION.—Subsection 

(c) of section 63, as amended by the Housing 

Assistance Tax Act of 2008, is amended by 

adding at the end the following new paragraph: 

‘‘(8) DISASTER LOSS DEDUCTION.—For the 

purposes of paragraph (1), the term ‘disaster 

loss deduction’ means the net disaster loss 

(as defined in section 165(h)(3)(B)).’’. 

(3) ALLOWANCE IN COMPUTING ALTERNATIVE

MINIMUM TAXABLE INCOME.—Subparagraph (E) 

of section 56(b)(1) is amended by adding at 

the end the following new sentence: ‘‘The 

preceding sentence shall not apply to so 

much of the standard deduction as is determined under section 63(c)(1)(D).’’. 

(c) INCREASE IN LIMITATION ON INDIVIDUAL

LOSS PER CASUALTY.—Paragraph (1) of section 165(h) is amended by striking ‘‘$100’’ and 

inserting ‘‘$500 ($100 for taxable years beginning after December 31, 2009)’’. 

(d) EFFECTIVE DATES.— 

(1) IN GENERAL.—Except as provided by 

paragraph (2), the amendments made by this 

section shall apply to disasters declared in 

taxable years beginning after December 31, 

2007. 

(2) INCREASE IN LIMITATION ON INDIVIDUAL

LOSS PER CASUALTY.—The amendment made 

by subsection (c) shall apply to taxable years 

beginning after December 31, 2008. 

SEC. 707. EXPENSING OF QUALIFIED DISASTER 

EXPENSES. 

(a) IN GENERAL.—Part VI of subchapter B 

of chapter 1 is amended by inserting after 

section 198 the following new section: 

‘‘SEC. 198A. EXPENSING OF QUALIFIED DISASTER 

EXPENSES. 

‘‘(a) IN GENERAL.—A taxpayer may elect to 

treat any qualified disaster expenses which 

are paid or incurred by the taxpayer as an 

expense which is not chargeable to capital 

account. Any expense which is so treated 


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shall be allowed as a deduction for the taxable year in which it is paid or incurred. 

‘‘(b) QUALIFIED DISASTER EXPENSE.—For 

purposes of this section, the term ‘qualified 

disaster expense’ means any expenditure— 

‘‘(1) which is paid or incurred in connection 

with a trade or business or with business-related property, 

‘‘(2) which is— 

‘‘(A) for the abatement or control of hazardous substances that were released on account of a federally declared disaster occurring before January 1, 2010, 

‘‘(B) for the removal of debris from, or the 

demolition of structures on, real property 

which is business-related property damaged 

or destroyed as a result of a federally declared disaster occurring before such date, or 

‘‘(C) for the repair of business-related property damaged as a result of a federally declared disaster occurring before such date, 

and 

‘‘(3) which is otherwise chargeable to capital account. 

‘‘(c) OTHER DEFINITIONS.—For purposes of 

this section— 

‘‘(1) BUSINESS-RELATED PROPERTY.—The 

term ‘business-related property’ means property— 

‘‘(A) held by the taxpayer for use in a trade 

or business or for the production of income, 

or 

‘‘(B) described in section 1221(a)(1) in the 

hands of the taxpayer. 

‘‘(2) FEDERALLY DECLARED DISASTER.—The 

term ‘federally declared disaster’ has the 

meaning given such term by section 

165(h)(3)(C)(i). 

‘‘(d) DEDUCTION RECAPTURED AS ORDINARY

INCOME ON SALE, ETC.—Solely for purposes of 

section 1245, in the case of property to which 

a qualified disaster expense would have been 

capitalized but for this section— 

‘‘(1) the deduction allowed by this section 

for such expense shall be treated as a deduction for depreciation, and 

‘‘(2) such property (if not otherwise section 

1245 property) shall be treated as section 1245 

property solely for purposes of applying section 1245 to such deduction. 

‘‘(e) COORDINATION WITH OTHER PROVISIONS.—Sections 198, 280B, and 468 shall not 

apply to amounts which are treated as expenses under this section. 

‘‘(f) REGULATIONS.—The Secretary shall 

prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section.’’. 

(b) CLERICAL AMENDMENT.—The table of 

sections for part VI of subchapter B of chapter 1 is amended by inserting after the item 

relating to section 198 the following new 

item: 

‘‘Sec. 198A. Expensing of Qualified Disaster 

Expenses.’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to amounts 

paid or incurred after December 31, 2007 in 

connection with disaster declared after such 

date. 

SEC. 708. NET OPERATING LOSSES ATTRIBUTABLE TO FEDERALLY DECLARED 

DISASTERS. 

(a) IN GENERAL.—Paragraph (1) of section 

172(b) is amended by adding at the end the 

following new subparagraph: 

‘‘(J) CERTAIN LOSSES ATTRIBUTABLE FEDERALLY DECLARED DISASTERS.—In the case of a 

taxpayer who has a qualified disaster loss (as 

defined in subsection (j)), such loss shall be a 

net operating loss carryback to each of the 5 

taxable years preceding the taxable year of 

such loss.’’. 

(b) QUALIFIED DISASTER LOSS.—Section 172 

is amended by redesignating subsections (j) 

and (k) as subsections (k) and (l), respectively, and by inserting after subsection (i) 

the following new subsection: 

‘‘(j) RULES RELATING TO QUALIFIED DISASTER LOSSES.—For purposes of this section— 

‘‘(1) IN GENERAL.—The term ‘qualified disaster loss’ means the lesser of— 

‘‘(A) the sum of— 

‘‘(i) the losses allowable under section 165 

for the taxable year— 

‘‘(I) attributable to a federally declared 

disaster (as defined in section 165(h)(3)(C)(i)) 

occurring before January 1, 2010, and 

‘‘(II) occurring in a disaster area (as defined in section 165(h)(3)(C)(ii)), and 

‘‘(ii) the deduction for the taxable year for 

qualified disaster expenses which is allowable under section 198A(a) or which would be 

so allowable if not otherwise treated as an 

expense, or 

‘‘(B) the net operating loss for such taxable 

year. 

‘‘(2) COORDINATION WITH SUBSECTION (b)(2).— 

For purposes of applying subsection (b)(2), a 

qualified disaster loss for any taxable year 

shall be treated in a manner similar to the 

manner in which a specified liability loss is 

treated. 

‘‘(3) ELECTION.—Any taxpayer entitled to a 

5-year carryback under subsection (b)(1)(J) 

from any loss year may elect to have the 

carryback period with respect to such loss 

year determined without regard to subsection (b)(1)(J). Such election shall be made 

in such manner as may be prescribed by the 

Secretary and shall be made by the due date 

(including extensions of time) for filing the 

taxpayer’s return for the taxable year of the 

net operating loss. Such election, once made 

for any taxable year, shall be irrevocable for 

such taxable year. 

‘‘(4) EXCLUSION.—The term ‘qualified disaster loss’ shall not include any loss with respect to any property described in section 

1400N(p)(3).’’. 

(c) LOSS DEDUCTION ALLOWED IN COMPUTING

ALTERNATIVE MINIMUM TAXABLE INCOME.— 

Subsection (d) of section 56 is amended by 

adding at the end the following new paragraph: 

‘‘(3) NET OPERATING LOSS ATTRIBUTABLE TO

FEDERALLY DECLARED DISASTERS.—In the case 

of a taxpayer which has a qualified disaster 

loss (as defined by section 172(b)(1)(J)) for 

the taxable year, paragraph (1) shall be applied by increasing the amount determined 

under subparagraph (A)(ii)(I) thereof by the 

sum of the carrybacks and carryovers of 

such loss.’’. 

(d) CONFORMING AMENDMENTS.— 

(1) Clause (ii) of section 172(b)(1)(F) is 

amended by inserting ‘‘or qualified disaster 

loss (as defined in subsection (j))’’ before the 

period at the end of the last sentence. 

(2) Paragraph (1) of section 172(i) is amended by adding at the end the following new 

flush sentence: 

‘‘Such term shall not include any qualified 

disaster loss (as defined in subsection (j)).’’. 

(e) EFFECTIVE DATE.—The amendments 

made by this section shall apply to losses 

arising in taxable years beginning after December 31, 2007, in connection with disasters 

declared after such date. 

SEC. 709. WAIVER OF CERTAIN MORTGAGE REVENUE BOND REQUIREMENTS FOLLOWING FEDERALLY DECLARED DISASTERS. 

(a) IN GENERAL.—Subsection (k) of section 

143 is amended by adding at the end the following new paragraph: 

‘‘(12) SPECIAL RULES FOR RESIDENCES DESTROYED IN FEDERALLY DECLARED DISASTERS.— 

‘‘(A) PRINCIPAL RESIDENCE DESTROYED.—At 

the election of the taxpayer, if the principal 

residence (within the meaning of section 121) 

of such taxpayer is— 

‘‘(i) rendered unsafe for use as a residence 

by reason of a federally declared disaster occurring before January 1, 2010, or 

‘‘(ii) demolished or relocated by reason of 

an order of the government of a State or political subdivision thereof on account of a 

federally declared disaster occurring before 

such date, 

then, for the 2-year period beginning on the 

date of the disaster declaration, subsection 

(d)(1) shall not apply with respect to such 

taxpayer and subsection (e) shall be applied 

by substituting ‘110’ for ‘90’ in paragraph (1) 

thereof. 

‘‘(B) PRINCIPAL RESIDENCE DAMAGED.— 

‘‘(i) IN GENERAL.—At the election of the 

taxpayer, if the principal residence (within 

the meaning of section 121) of such taxpayer 

was damaged as the result of a federally declared disaster occurring before January 1, 

2010, any owner-financing provided in connection with the repair or reconstruction of 

such residence shall be treated as a qualified 

rehabilitation loan. 

‘‘(ii) LIMITATION.—The aggregate owner-financing to which clause (i) applies shall not 

exceed the lesser of— 

‘‘(I) the cost of such repair or reconstruction, or 

‘‘(II) $150,000. 

‘‘(C) FEDERALLY DECLARED DISASTER.—For 

purposes of this paragraph, the term ‘federally declared disaster’ has the meaning given 

such term by section 165(h)(3)(C)(i). 

‘‘(D) ELECTION; DENIAL OF DOUBLE BENEFIT.— 

‘‘(i) ELECTION.—An election under this 

paragraph may not be revoked except with 

the consent of the Secretary. 

‘‘(ii) DENIAL OF DOUBLE BENEFIT.—If a taxpayer elects the application of this paragraph, paragraph (11) shall not apply with respect to the purchase or financing of any residence by such taxpayer.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by subsection (a) shall apply to disasters occurring after December 31, 2007. 

SEC. 710. SPECIAL DEPRECIATION ALLOWANCE 

FOR QUALIFIED DISASTER PROPERTY. 

(a) IN GENERAL.—Section 168, as amended 

by this Act, is amended by adding at the end 

the following new subsection: 

‘‘(n) SPECIAL ALLOWANCE FOR QUALIFIED

DISASTER ASSISTANCE PROPERTY.— 

‘‘(1) IN GENERAL.—In the case of any qualified disaster assistance property— 

‘‘(A) the depreciation deduction provided 

by section 167(a) for the taxable year in 

which such property is placed in service shall 

include an allowance equal to 50 percent of 

the adjusted basis of the qualified disaster 

assistance property, and 

‘‘(B) the adjusted basis of the qualified disaster assistance property shall be reduced by 

the amount of such deduction before computing the amount otherwise allowable as a 

depreciation deduction under this chapter 

for such taxable year and any subsequent 

taxable year. 

‘‘(2) QUALIFIED DISASTER ASSISTANCE PROPERTY.—For purposes of this subsection— 

‘‘(A) IN GENERAL.—The term ‘qualified disaster assistance property’ means any property— 

‘‘(i)(I) which is described in subsection 

(k)(2)(A)(i), or 

‘‘(II) which is nonresidential real property 

or residential rental property, 

‘‘(ii) substantially all of the use of which 

is— 

‘‘(I) in a disaster area with respect to a federally declared disaster occurring before 

January 1, 2010, and 

‘‘(II) in the active conduct of a trade or 

business by the taxpayer in such disaster 

area, 


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‘‘(iii) which— 

‘‘(I) rehabilitates property damaged, or replaces property destroyed or condemned, as a 

result of such federally declared disaster, except that, for purposes of this clause, property shall be treated as replacing property 

destroyed or condemned if, as part of an integrated plan, such property replaces property which is included in a continuous area 

which includes real property destroyed or 

condemned, and 

‘‘(II) is similar in nature to, and located in 

the same county as, the property being rehabilitated or replaced, 

‘‘(iv) the original use of which in such disaster area commences with an eligible taxpayer on or after the applicable disaster 

date, 

‘‘(v) which is acquired by such eligible taxpayer by purchase (as defined in section 

179(d)) on or after the applicable disaster 

date, but only if no written binding contract 

for the acquisition was in effect before such 

date, and 

‘‘(vi) which is placed in service by such eligible taxpayer on or before the date which is 

the last day of the third calendar year following the applicable disaster date (the 

fourth calendar year in the case of nonresidential real property and residential rental 

property). 

‘‘(B) EXCEPTIONS.— 

‘‘(i) OTHER BONUS DEPRECIATION PROPERTY.—The term ‘qualified disaster assistance property’ shall not include— 

‘‘(I) any property to which subsection (k) 

(determined without regard to paragraph 

(4)), (l), or (m) applies, 

‘‘(II) any property to which section 

1400N(d) applies, and 

‘‘(III) any property described in section 

1400N(p)(3). 

‘‘(ii) ALTERNATIVE DEPRECIATION PROPERTY.—The term ‘qualified disaster assistance property’ shall not include any property to which the alternative depreciation 

system under subsection (g) applies, determined without regard to paragraph (7) of 

subsection (g) (relating to election to have 

system apply). 

‘‘(iii) TAX-EXEMPT BOND FINANCED PROPERTY.—Such term shall not include any property any portion of which is financed with 

the proceeds of any obligation the interest 

on which is exempt from tax under section 

103. 

‘‘(iv) QUALIFIED REVITALIZATION BUILDINGS.—Such term shall not include any 

qualified revitalization building with respect 

to which the taxpayer has elected the application of paragraph (1) or (2) of section 

1400I(a). 

‘‘(v) ELECTION OUT.—If a taxpayer makes 

an election under this clause with respect to 

any class of property for any taxable year, 

this subsection shall not apply to all property in such class placed in service during 

such taxable year. 

‘‘(C) SPECIAL RULES.—For purposes of this 

subsection, rules similar to the rules of subparagraph (E) of subsection (k)(2) shall 

apply, except that such subparagraph shall 

be applied— 

‘‘(i) by substituting ‘the applicable disaster 

date’ for ‘December 31, 2007’ each place it appears therein, 

‘‘(ii) without regard to ‘and before January 

1, 2009’ in clause (i) thereof, and 

‘‘(iii) by substituting ‘qualified disaster assistance property’ for ‘qualified property’ in 

clause (iv) thereof. 

‘‘(D) ALLOWANCE AGAINST ALTERNATIVE MINIMUM TAX.—For purposes of this subsection, 

rules similar to the rules of subsection 

(k)(2)(G) shall apply. 

‘‘(3) OTHER DEFINITIONS.—For purposes of 

this subsection— 

‘‘(A) APPLICABLE DISASTER DATE.—The 

term ‘applicable disaster date’ means, with 

respect to any federally declared disaster, 

the date on which such federally declared 

disaster occurs. 

‘‘(B) FEDERALLY DECLARED DISASTER.—The 

term ‘federally declared disaster’ has the 

meaning given such term under section 

165(h)(3)(C)(i). 

‘‘(C) DISASTER AREA.—The term ‘disaster 

area’ has the meaning given such term under 

section 165(h)(3)(C)(ii). 

‘‘(D) ELIGIBLE TAXPAYER.—The term ‘eligible taxpayer’ means a taxpayer who has suffered an economic loss attributable to a federally declared disaster. 

‘‘(4) RECAPTURE.—For purposes of this subsection, rules similar to the rules under section 179(d)(10) shall apply with respect to any 

qualified disaster assistance property which 

ceases to be qualified disaster assistance 

property.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to property 

placed in service after December 31, 2007, 

with respect disasters declared after such 

date. 

SEC. 711. INCREASED EXPENSING FOR QUALIFIED DISASTER ASSISTANCE PROPERTY. 

(a) IN GENERAL.—Section 179 is amended by 

adding at the end the following new subsection: 

‘‘(e) SPECIAL RULES FOR QUALIFIED DISASTER ASSISTANCE PROPERTY.— 

‘‘(1) IN GENERAL.—For purposes of this section— 

‘‘(A) the dollar amount in effect under subsection (b)(1) for the taxable year shall be increased by the lesser of— 

‘‘(i) $100,000, or 

‘‘(ii) the cost of qualified section 179 disaster assistance property placed in service 

during the taxable year, and 

‘‘(B) the dollar amount in effect under subsection (b)(2) for the taxable year shall be increased by the lesser of— 

‘‘(i) $600,000, or 

‘‘(ii) the cost of qualified section 179 disaster assistance property placed in service 

during the taxable year. 

‘‘(2) QUALIFIED SECTION 179 DISASTER ASSISTANCE PROPERTY.—For purposes of this subsection, the term ‘qualified section 179 disaster assistance property’ means section 179 

property (as defined in subsection (d)) which 

is qualified disaster assistance property (as 

defined in section 168(n)(2)). 

‘‘(3) COORDINATION WITH EMPOWERMENT

ZONES AND RENEWAL COMMUNITIES.—For purposes of sections 1397A and 1400J, qualified 

section 179 disaster assistance property shall 

not be treated as qualified zone property or 

qualified renewal property, unless the taxpayer elects not to take such qualified section 179 disaster assistance property into account for purposes of this subsection. 

‘‘(4) RECAPTURE.—For purposes of this subsection, rules similar to the rules under subsection (d)(10) shall apply with respect to 

any qualified section 179 disaster assistance 

property which ceases to be qualified section 

179 disaster assistance property.’’. 

(b) EFFECTIVE DATE.—The amendment 

made by this section shall apply to property 

placed in service after December 31, 2007, 

with respect disasters declared after such 

date. 

SEC. 712. COORDINATION WITH HEARTLAND DISASTER RELIEF. 

The amendments made by this subtitle, 

other than the amendments made by sections 706(a)(2), 710, and 711, shall not apply to 

any disaster described in section 702(c)(1)(A), 

or to any expenditure or loss resulting from 

such disaster. 

TITLE VIII—SPENDING REDUCTIONS AND 

APPROPRIATE REVENUE RAISERS FOR 

NEW TAX RELIEF POLICY 

SEC. 801. NONQUALIFIED DEFERRED COMPENSATION FROM CERTAIN TAX INDIFFERENT PARTIES. 

(a) IN GENERAL.—Subpart B of part II of 

subchapter E of chapter 1 is amended by inserting after section 457 the following new 

section: 

‘‘SEC. 457A. NONQUALIFIED DEFERRED COMPENSATION FROM CERTAIN TAX INDIFFERENT PARTIES. 

‘‘(a) IN GENERAL.—Any compensation 

which is deferred under a nonqualified deferred compensation plan of a nonqualified 

entity shall be includible in gross income 

when there is no substantial risk of forfeiture of the rights to such compensation. 

‘‘(b) NONQUALIFIED ENTITY.—For purposes 

of this section, the term ‘nonqualified entity’ means— 

‘‘(1) any foreign corporation unless substantially all of its income is— 

‘‘(A) effectively connected with the conduct of a trade or business in the United 

States, or 

‘‘(B) subject to a comprehensive foreign income tax, and 

‘‘(2) any partnership unless substantially 

all of its income is allocated to persons other 

than— 

‘‘(A) foreign persons with respect to whom 

such income is not subject to a comprehensive foreign income tax, and 

‘‘(B) organizations which are exempt from 

tax under this title. 

‘‘(c) DETERMINABILITY OF AMOUNTS OF COMPENSATION.— 

‘‘(1) IN GENERAL.—If the amount of any 

compensation is not determinable at the 

time that such compensation is otherwise includible in gross income under subsection 

(a)— 

‘‘(A) such amount shall be so includible in 

gross income when determinable, and 

‘‘(B) the tax imposed under this chapter for 

the taxable year in which such compensation 

is includible in gross income shall be increased by the sum of— 

‘‘(i) the amount of interest determined 

under paragraph (2), and 

‘‘(ii) an amount equal to 20 percent of the 

amount of such compensation. 

‘‘(2) INTEREST.—For purposes of paragraph 

(1)(B)(i), the interest determined under this 

paragraph for any taxable year is the 

amount of interest at the underpayment rate 

under section 6621 plus 1 percentage point on 

the underpayments that would have occurred 

had the deferred compensation been includible in gross income for the taxable year in 

which first deferred or, if later, the first taxable year in which such deferred compensation is not subject to a substantial risk of 

forfeiture. 

‘‘(d) OTHER DEFINITIONS AND SPECIAL

RULES.—For purposes of this section— 

‘‘(1) SUBSTANTIAL RISK OF FORFEITURE.— 

‘‘(A) IN GENERAL.—The rights of a person to 

compensation shall be treated as subject to a 

substantial risk of forfeiture only if such 

person’s rights to such compensation are 

conditioned upon the future performance of 

substantial services by any individual. 

‘‘(B) EXCEPTION FOR COMPENSATION BASED

ON GAIN RECOGNIZED ON AN INVESTMENT

ASSET.— 

‘‘(i) IN GENERAL.—To the extent provided in 

regulations prescribed by the Secretary, if 

compensation is determined solely by reference to the amount of gain recognized on 

the disposition of an investment asset, such 

compensation shall be treated as subject to a 

substantial risk of forfeiture until the date 

of such disposition. 

‘‘(ii) INVESTMENT ASSET.—For purposes of 

clause (i), the term ‘investment asset’ means 


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any single asset (other than an investment 

fund or similar entity)— 

‘‘(I) acquired directly by an investment 

fund or similar entity, 

‘‘(II) with respect to which such entity 

does not (nor does any person related to such 

entity) participate in the active management of such asset (or if such asset is an interest in an entity, in the active management of the activities of such entity), and 

‘‘(III) substantially all of any gain on the 

disposition of which (other than such deferred compensation) is allocated to investors in such entity. 

‘‘(iii) COORDINATION WITH SPECIAL RULE.— 

Paragraph (3)(B) shall not apply to any compensation to which clause (i) applies. 

‘‘(2) COMPREHENSIVE FOREIGN INCOME TAX.— 

The term ‘comprehensive foreign income 

tax’ means, with respect to any foreign person, the income tax of a foreign country if— 

‘‘(A) such person is eligible for the benefits 

of a comprehensive income tax treaty between such foreign country and the United 

States, or 

‘‘(B) such person demonstrates to the satisfaction of the Secretary that such foreign 

country has a comprehensive income tax. 

‘‘(3) NONQUALIFIED DEFERRED COMPENSATION

PLAN.— 

‘‘(A) IN GENERAL.—The term ‘nonqualified 

deferred compensation plan’ has the meaning 

given such term under section 409A(d), except that such term shall include any plan 

that provides a right to compensation based 

on the appreciation in value of a specified 

number of equity units of the service recipient. 

‘‘(B) EXCEPTION.—Compensation shall not 

be treated as deferred for purposes of this 

section if the service provider receives payment of such compensation not later than 12 

months after the end of the taxable year of 

the service recipient during which the right 

to the payment of such compensation is no 

longer subject to a substantial risk of forfeiture. 

‘‘(4) EXCEPTION FOR CERTAIN COMPENSATION

WITH RESPECT TO EFFECTIVELY CONNECTED INCOME.—In the case a foreign corporation with 

income which is taxable under section 882, 

this section shall not apply to compensation 

which, had such compensation had been paid 

in cash on the date that such compensation 

ceased to be subject to a substantial risk of 

forfeiture, would have been deductible by 

such foreign corporation against such income. 

‘‘(5) APPLICATION OF RULES.—Rules similar 

to the rules of paragraphs (5) and (6) of section 409A(d) shall apply. 

‘‘(e) REGULATIONS.—The Secretary shall 

prescribe such regulations as may be necessary or appropriate to carry out the purposes of this section, including regulations 

disregarding a substantial risk of forfeiture 

in cases where necessary to carry out the 

purposes of this section.’’. 

(b) CONFORMING AMENDMENT.—Section 

26(b)(2), as amended by the Housing Assistance Tax Act of 2008, is amended by striking 

‘‘and’’ at the end of subparagraph (V), by 

striking the period at the end of subparagraph (W) and inserting ‘‘, and’’, and by adding at the end the following new subparagraph: 

‘‘(X) section 457A(c)(1)(B) (relating to determinability of amounts of compensation).’’. 

(c) CLERICAL AMENDMENT.—The table of 

sections of subpart B of part II of subchapter 

E of chapter 1 is amended by inserting after 

the item relating to section 457 the following 

new item: 

‘‘Sec. 457A. Nonqualified deferred compensation from certain tax indifferent parties.’’. 

(d) EFFECTIVE DATE.— 

(1) IN GENERAL.—Except as otherwise provided in this subsection, the amendments 

made by this section shall apply to amounts 

deferred which are attributable to services 

performed after December 31, 2008. 

(2) APPLICATION TO EXISTING DEFERRALS.— 

In the case of any amount deferred to which 

the amendments made by this section do not 

apply solely by reason of the fact that the 

amount is attributable to services performed 

before January 1, 2009, to the extent such 

amount is not includible in gross income in 

a taxable year beginning before 2018, such 

amounts shall be includible in gross income 

in the later of— 

(A) the last taxable year beginning before 

2018, or 

(B) the taxable year in which there is no 

substantial risk of forfeiture of the rights to 

such compensation (determined in the same 

manner as determined for purposes of section 

457A of the Internal Revenue Code of 1986, as 

added by this section). 

(3) ACCELERATED PAYMENTS.—No later than 

120 days after the date of the enactment of 

this Act, the Secretary shall issue guidance 

providing a limited period of time during 

which a nonqualified deferred compensation 

arrangement attributable to services performed on or before December 31, 2008, may, 

without violating the requirements of section 409A(a) of the Internal Revenue Code of 

1986, be amended to conform the date of distribution to the date the amounts are required to be included in income. 

(4) CERTAIN BACK-TO-BACK ARRANGEMENTS.— 

If the taxpayer is also a service recipient and 

maintains one or more nonqualified deferred 

compensation arrangements for its service 

providers under which any amount is attributable to services performed on or before December 31, 2008, the guidance issued under 

paragraph (4) shall permit such arrangements to be amended to conform the dates of 

distribution under such arrangement to the 

date amounts are required to be included in 

the income of such taxpayer under this subsection. 

(5) ACCELERATED PAYMENT NOT TREATED AS

MATERIAL MODIFICATION.—Any amendment to 

a nonqualified deferred compensation arrangement made pursuant to paragraph (4) 

or (5) shall not be treated as a material 

modification of the arrangement for purposes of section 409A of the Internal Revenue 

Code of 1986. 

SA 5686. Mr. DODD proposed an 

amendment to the bill H.R. 1424, of 

1974, section 2705 of the Public Health 

Service Act, section 9812 of the Internal Revenue Code of 1986 to require equity in the provision of mental health 

and substance-related disorder benefits 

under group health plans, to prohibit 

discrimination on the basis of genetic 

information with respect to health insurance and employment, and for other 

purposes; as follows: 

Amend the title so as to read: 

‘‘To provide authority for the Federal Government to purchase and insure certain 

types of troubled assets for the purposes of 

providing stability to and preventing disruption in the economy and financial system 

and protecting taxpayers, to amend the Internal Revenue Code of 1986 to provide incentives for energy production and conservation, to extend certain expiring provisions, 

to provide individual income tax relief, and 

for other purposes’’. 

SA 5687. Mr. SANDERS proposed an 

amendment to amendment SA 5685 proposed by Mr. DODD to the bill H.R. 1424, 

of 1974, section 2705 of the Public 

Health Service Act, section 9812 of the 

Internal Revenue Code of 1986 to require equity in the provision of mental 

health and substance-related disorder 

benefits under group health plans, to 

prohibit discrimination on the basis of 

genetic information with respect to 

health insurance and employment, and 

for other purposes; as follows: 

At the end add the following: 

SEC. 304. SURTAX ON HIGH INCOME EARNERS. 

(a) IN GENERAL.—Part I of subchapter A of 

chapter 1 of the Internal Revenue Code of 

1986 is amended by inserting after section 1 

the following new section: 

‘‘SEC. 1A. INCREASE IN TAX ON HIGH INCOME INDIVIDUALS. 

‘‘(a) GENERAL RULE.—In the case of a taxpayer other than a corporation, there is 

hereby imposed (in addition to any other tax 

imposed by this subtitle) a tax equal to 10 

percent of so much of modified adjusted 

gross income as exceeds $500,000 ($1,000,000 in 

the case of a joint return or a surviving 

spouse (as defined in section 2(a)). 

‘‘(b) MODIFIED ADJUSTED GROSS INCOME.— 

For purposes of this section, the term ‘modified adjusted gross income’ means adjusted 

gross income reduced by any deduction allowed for investment interest (as defined in 

section 163(d)). In the case of an estate or 

trust, a rule similar to the rule of section 

67(e) shall apply for purposes of determining 

adjusted gross income for purposes of this 

section. 

‘‘(c) NONRESIDENT ALIEN.—In the case of a 

nonresident alien individual, only amounts 

taken into account in connection with the 

tax imposed by section 871(b) shall be taken 

into account under this section. 

‘‘(d) MARITAL STATUS.—For purposes of 

this section, marital status shall be determined under section 7703. 

‘‘(e) NOT TREATED AS TAX IMPOSED BY THIS

CHAPTER FOR CERTAIN PURPOSES.—The tax 

imposed under this section shall not be 

treated as tax imposed by this chapter for 

purposes of determining the amount of any 

credit under this chapter or for purposes of 

section 55. 

‘‘(f) TERMINATION.—This section shall not 

apply to taxable years beginning after the 

date which is 5 years after the date of the enactment of this section.’’. 

(b) CLERICAL AMENDMENT.—The table of 

sections for part I of subchapter A of chapter 

1 of the Internal Revenue Code of 1986 is 

amended by inserting after the item relating 

to section 1 the following new item: 

‘‘Sec. 1A. Increase in tax on high income individuals.’’. 

(c) EFFECTIVE DATE.—The amendments 

made by this section shall apply to taxable 

years beginning after the date of the enactment of this Act. 

(d) SECTION 15 NOT TO APPLY.—The amendment made by subsection (a) shall not be 

treated as a change in a rate of tax for purposes of section 15 of the Internal Revenue 

Code of 1986. 

SA 5688. Mr. DURBIN proposed an 

amendment to the bill S. 1703, to prevent and reduce trafficking in persons; 

as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. SHORT TITLE. 

This Act may be cited as the ‘‘Trafficking 

in Persons Accountability Act of 2008’’. 

SEC. 2. JURISDICTION IN CERTAIN TRAFFICKING 

OFFENSES. 

(a) IN GENERAL.—Chapter 77 of title 18, 

United States Code, is amended by adding at 

the end the following: 


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October 1, 2008 CONGRESSIONAL RECORD — SENATE S10387 

‘‘§ 1596. Additional jurisdiction in certain 

trafficking offenses 

‘‘(a) IN GENERAL.—In addition to any domestic or extra-territorial jurisdiction otherwise provided by law, the courts of the 

United States have extra-territorial jurisdiction over any offense (or any attempt or conspiracy to commit an offense) under section 

1581, section 1583, section 1584, section 1589, 

section 1590, or section 1591 of this title if— 

‘‘(1) an alleged offender is a national of the 

United States or an alien lawfully admitted 

for permanent residence (as those terms are 

defined in section 101 of the Immigration and 

Nationality Act (8 U.S.C. 1101)); or 

‘‘(2) an alleged offender is present in the 

United States, irrespective of the nationality 

of the alleged offender. 

‘‘(b) LIMITATION ON PROSECUTIONS OF OFFENSES PROSECUTED IN OTHER COUNTRIES.— 

No prosecution may be commenced against a 

person under this section if a foreign government, in accordance with jurisdiction recognized by the United States, has prosecuted or 

is prosecuting such person for the conduct 

constituting such offense, except upon the 

approval of the Attorney General or the Deputy Attorney General (or a person acting in 

either such capacity), which function of approval may not be delegated.’’. 

(b) CLERICAL AMENDMENT.—The table of 

sections at the beginning of chapter 77 of 

title 18, United States Code, is amended by 

adding at the end the following: 

‘‘1596. Additional jurisdiction in certain trafficking offenses.’’. 

SA 5689. Mr. DURBIN (for Ms. COLLINS) proposed an amendment to the 

bill S. 3013, to provide for retirement 

equity for Federal employees in nonforeign areas outside the 48 contiguous 

States and the District of Columbia, 

and for other purposes; as follows: 

On page 7, line 8, strike ‘‘9’’ and insert ‘‘8’’. 

On page 10, line 12, strike ‘‘the’’ and insert 

‘‘this’’. 

On page 17, line 18, strike ‘‘or 8’’. 

On page 21, line 1, strike all through page 

22, line 17. 

On page 22, line 18, strike ‘‘SEC. 9’’ and insert ‘‘SEC. 8’’. 

On page 23, line 20, strike ‘‘SEC. 10’’ and insert ‘‘SEC. 9’’. 

SA 5690. Mr. DURBIN (for Mr. 

CORNYN (for himself and Mrs. FEINSTEIN)) proposed an amendment to the 

bill S. 3073, to amend the Uniformed 

and Overseas Citizens Absentee Voting 

Act to improve procedures for the collection and delivery of absentee ballots 

of absent overseas uniformed services 

voters, and for other purposes; as follows: 

Strike all after the enacting clause and insert the following: 

SECTION 1. PROCEDURES FOR COLLECTION AND 

DELIVERY OF MARKED ABSENTEE 

BALLOTS OF ABSENT OVERSEAS 

UNIFORMED SERVICES VOTERS. 

(a) PROCEDURES.— 

(1) IN GENERAL.—The Uniformed and Overseas Citizens Absentee Voting Act (42 U.S.C. 

1973ff et seq.) is amended by inserting after 

section 103 the following new section: 

‘‘SEC. 103A. PROCEDURES FOR COLLECTION AND 

DELIVERY OF MARKED ABSENTEE 

BALLOTS OF ABSENT OVERSEAS 

UNIFORMED SERVICES VOTERS. 

‘‘(a) COLLECTION.—The Presidential designee shall establish procedures for collecting marked absentee ballots of absent 

overseas uniformed services voters in regularly scheduled general elections for Federal 

office, including absentee ballots prepared by 

States and Federal write-in absentee ballots 

prescribed under section 103, and for delivering the ballots to the appropriate election 

officials. 

‘‘(b) ENSURING DELIVERY PRIOR TO CLOSING

OF POLLS.— 

‘‘(1) IN GENERAL.—Under the procedures established under this section, the Presidential 

designee shall ensure that any marked absentee ballot for a regularly scheduled general election for Federal office which is collected prior to the deadline described in 

paragraph (3) is delivered to the appropriate 

election official in a State prior to the time 

established by the State for the closing of 

the polls on the date of the election. 

‘‘(2) CONTRACT WITH EXPRESS MAIL PROVIDERS.— 

‘‘(A) IN GENERAL.—The Presidential designee shall carry out this section by contract 

with one or more providers of express mail 

services. 

‘‘(B) SPECIAL RULE FOR VOTERS IN JURISDICTIONS USING POST OFFICE BOXES FOR COLLECTION OF MARKED ABSENTEE BALLOTS.—In the 

case of an absent uniformed services voter 

who wishes to use the procedures established 

under this section and whose marked absentee ballot is required by the appropriate 

election official to be delivered to a post office box, the Presidential designee shall 

enter into an agreement with the United 

States Postal Service for the delivery of the 

ballot to the election official under the procedures established under this section. 

‘‘(3) DEADLINE DESCRIBED.— 

‘‘(A) IN GENERAL.—Except as provided in 

subparagraph (B), the deadline described in 

this paragraph is noon (in the location in 

which the ballot is collected) on the last 

Tuesday that precedes the date of the election. 

‘‘(B) AUTHORITY TO ESTABLISH ALTERNATIVE

DEADLINE FOR CERTAIN LOCATIONS.—If the 

Presidential designee determines that the 

deadline described in subparagraph (A) is not 

sufficient to ensure timely delivery of the 

ballot under paragraph (1) with respect to a 

particular location because of remoteness or 

other factors, the Presidential designee may 

establish as an alternative deadline for that 

location the latest date occurring prior to 

the deadline described in subparagraph (A) 

which is sufficient to ensure timely delivery 

of the ballot under paragraph (1). 

‘‘(4) PROHIBITION ON REFUSAL BY STATES TO

ACCEPT MARKED ABSENTEE BALLOTS NOT DELIVERED BY POSTAL SERVICE OR IN PERSON.—A 

State may not refuse to accept or process 

any marked absentee ballot delivered under 

the procedures established under this section 

on the grounds that the ballot is received by 

the State other than through delivery by the 

United States Postal Service. 

‘‘(c) TRACKING MECHANISM.—Under the procedures established under this section, the 

entity responsible for delivering marked absentee ballots to the appropriate election officials shall implement procedures to enable 

any individual whose ballot for a regularly 

scheduled general election for Federal office 

is collected by the Presidential designee to 

determine whether the ballot has been delivered to the appropriate election official, 

using the Internet, an automated telephone 

system, or such other methods as the entity 

may provide. 

‘‘(d) ABSENT OVERSEAS UNIFORMED SERVICES VOTER DEFINED.—In this section, the 

term ‘absent overseas uniformed services 

voter’ means an overseas voter described in 

section 107(5)(A). 

‘‘(e) AUTHORIZATION OF APPROPRIATIONS.— 

There are authorized to be appropriated to 

the Presidential designee such sums as may 

be necessary to carry out this section.’’. 

(2) EFFECTIVE DATE.—Section 103A of the 

Uniformed and Overseas Citizens Absentee 

Voting Act, as added by this subsection, 

shall apply with respect to each regularly 

scheduled general election for Federal office 

held on or after November 1, 2010. 

(b) CONFORMING AMENDMENTS.— 

(1) FEDERAL RESPONSIBILITIES.—Section 

101(b) of such Act (42 U.S.C. 1973ff(b)) is 

amended— 

(A) by striking ‘‘and’’ at the end of paragraph (6); 

(B) by striking the period at the end of 

paragraph (7) and inserting ‘‘; and’’; and 

(C) by adding at the end the following new 

paragraph: 

‘‘(8) carry out section 103A with respect to 

the collection and delivery of marked absentee ballots of absent overseas uniformed 

services voters in elections for Federal office.’’. 

(2) STATE RESPONSIBILITIES.—Section 102(a) 

of such Act (42 U.S.C. 1973ff—1(a)) is amended— 

(A) by striking ‘‘and’’ at the end of paragraph (4); 

(B) by striking the period at the end of 

paragraph (5) and inserting ‘‘; and’’; and 

(C) by adding at the end the following new 

paragraph: 

‘‘(6) carry out section 103A(b)(2) with respect to the processing and acceptance of 

marked absentee ballots of absent overseas 

uniformed services voters.’’. 

(c) OUTREACH FOR ABSENT OVERSEAS UNIFORMED SERVICES VOTERS ON PROCEDURES.— 

The Presidential designee shall take appropriate actions to inform individuals who are 

anticipated to be absent overseas uniformed 

services voters in the regularly scheduled 

general election for Federal office held in 

November 2008 of the procedures for the collection and delivery of marked absentee ballots established pursuant to section 103A of 

the Uniformed and Overseas Citizens Absentee Voting Act, as added by subsection (a), 

including the manner in which such voters 

may utilize such procedures for the submittal of marked absentee ballots in regularly scheduled elections for Federal office. 

(d) REPORTS ON UTILIZATION OF PROCEDURES.— 

(1) REPORTS REQUIRED.—Not later than 180 

days after each regularly scheduled general 

election for Federal office held after January 

1, 2008, the Presidential designee shall submit to the congressional defense committees 

a report on the utilization of the procedures 

for the collection and delivery of marked absentee ballots established pursuant to section 103A of the Uniformed and Overseas 

Citizens Absentee Voting Act, as so added, 

during such general election. 

(2) ELEMENTS.—Each report under paragraph (1) shall include, for the general election covered by such report, a description of 

the utilization of the procedures described in 

that paragraph during such general election, 

including the number of marked absentee 

ballots collected and delivered under such 

procedures. 

(e) REPORT ON STATUS OF IMPLEMENTATION.— 

(1) REPORT REQUIRED.—Not later than one 

year after the date of the enactment of this 

Act, the Presidential designee shall submit 

to the congressional defense committees a 

report on the status of the implementation 

of the program for the collection and delivery of marked absentee ballots established 

pursuant to section 103A of the Uniformed 

and Overseas Citizens Absentee Voting Act, 

as added by subsection (a). 

(2) ELEMENTS.—The report under paragraph 

(1) shall include a status of the implementation of the program and a detailed description of the specific steps taken towards its 

implementation for November 2009 and November 2010. 

(f) DEFINITIONS.—In this section: 


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S10388 CONGRESSIONAL RECORD — SENATE October 1, 2008 

(1) The term ‘‘absent overseas uniformed 

services voter’’ has the meaning given that 

term in section 103A(d) of the Uniformed and 

Overseas Citizens Absentee Voting Act, as 

added by subsection (a). 

(2) The term ‘‘Presidential designee’’ 

means the official designated under section 

101(a) of the Uniformed and Overseas Citizens 

Absentee Voting Act (42 U.S.C. 1973ff(a)). 

(3) The term ‘‘congressional defense committees’’ means— 

(A) the Committee on Armed Services and 

the Committee on Appropriations of the Senate; and 

(B) the Committee on Armed Services and 

the Committee on Appropriations of the 

House of Representatives. 

SEC. 2. PROHIBITION ON REFUSAL TO ACCEPT 

VOTER REGISTRATION AND ABSENTEE BALLOT APPLICATIONS AND 

FEDERAL WRITE-IN ABSENTEE BALLOTS FOR FAILURE TO MEET NONESSENTIAL REQUIREMENTS. 

(a) VOTER REGISTRATION AND ABSENTEE

BALLOT APPLICATIONS.— 

(1) PROHIBITING REFUSAL TO ACCEPT APPLICATIONS FOR FAILURE TO MEET NONESSENTIAL

REQUIREMENTS.—Section 102 of the Uniformed and Overseas Citizens Absentee Voting Act (42 U.S.C. 1973ff–1) is amended by 

adding at the end the following new subsection: 

‘‘(e) PROHIBITING REFUSAL TO ACCEPT APPLICATIONS FOR FAILURE TO MEET NONESSENTIAL REQUIREMENTS.—A State shall accept and process any otherwise valid voter 

registration application or absentee ballot 

application (including the official post card 

form prescribed under section 101) submitted 

in any manner by an absent uniformed services voter or overseas voter that contains 

the information required on the official post 

card form prescribed under section 101 (other 

than information which the Presidential designee, in consultation with the Election Assistance Commission and the Election Assistance Commission Board of Advisors 

under section 214 of the Help America Vote 

Act of 2002 (42 U.S.C. 15344), determines, 

under regulations promulgated by the Presidential designee, is not clearly necessary to 

prevent fraud in the conduct of elections).’’. 

(2) EFFECTIVE DATE.—Subsection (e) of section 102 of the Uniformed and Overseas Citizens Absentee Voting Act, as added by this 

subsection, shall apply with respect to each 

regularly scheduled general election for Federal office held on or after November 1, 2010. 

(b) FEDERAL WRITE-IN ABSENTEE BALLOT.— 

(1) PROHIBITING REFUSAL TO ACCEPT BALLOT

FOR FAILURE TO MEET NONESSENTIAL REQUIREMENTS.—Section 103 of such Act (42 U.S.C. 

1973ff–2) is amended— 

(A) by redesignating subsection (f) as subsection (g); and 

(B) by inserting after subsection (e) the following new subsection: 

‘‘(f) PROHIBITING REFUSAL TO ACCEPT BALLOT FOR FAILURE TO MEET NONESSENTIAL REQUIREMENTS.—A State shall accept and process any otherwise valid Federal write-in absentee ballot submitted in any manner by an 

absent uniformed services voter or overseas 

voter that contains the information required 

to be submitted with such ballot by the Presidential designee (other than information 

which the Presidential designee, in consultation with the Election Assistance Commission and the Election Assistance Commission 

Board of Advisors under section 214 of the 

Help America Vote Act of 2002 (42 U.S.C. 

15344), determines, under regulations promulgated by the Presidential designee, is not 

clearly necessary to prevent fraud in the 

conduct of elections).’’. 

(2) EFFECTIVE DATE.—Subsection (f) of section 102 of the Uniformed and Overseas Citizens Absentee Voting Act, as amended by 

this subsection, shall apply with respect to 

each regularly scheduled general election for 

Federal office held on or after November 1, 

2010. 

SA 5691. Ms. CANTWELL submitted 

an amendment intended to be proposed 

by her to the bill H.R. 1424, of 1974, section 2705 of the Public Health Service 

Act, section 9812 of the Internal Revenue Code of 1986 to require equity in 

the provision of mental health and substance-related disorder benefits under 

group health plans, to prohibit discrimination on the basis of genetic information with respect to health insurance and employment, and for other 

purposes; which was ordered to lie on 

the table; as follows: 

At the end of title I in division A, add the 

following: 

SEC. 137. EQUITY AUTHORITY. 

(a) IN GENERAL.—If the Secretary establishes a program under this division, the Secretary shall use not less than $350,000,000,000 

of the purchase authority provided under 

section 101 for the purchase of nonvoting preferred stock meeting the criteria in subsection (b). 

(b) ELIGIBLE FINANCIAL INSTITUTIONS.—The 

authority under this section may be exercised only with respect to financial institutions that— 

(1) are deemed by the appropriate regulatory authorities to be adequately capitalized, in relation to their current balance 

sheets; 

(2) raises such additional capital from private sources or from the Secretary under 

this Act as is determined sufficient by the 

appropriate regulatory authority for such financial institution; and 

(3) is not deemed to be insolvent by the appropriate regulatory authority. 

(c) EQUITY CRITERIA.—Nonvoting preferred 

stock authorized for purchase under this section shall— 

(1) have a low-interest-rate coupon (not to 

exceed 5 percent), with warrants attached; 

(2) provide that shareholders will have 

rights to invest on terms that are equivalent 

to those of the Secretary, and such rights 

shall be tradeable; 

(3) set terms to give such rights a positive 

value; and 

(4) give private investors preference over 

the Secretary in the allocation of the new 

issues. 

(d) LIMITS.—Financial institutions recapitalized in accordance with this section shall 

be permitted to increase their leverage until 

such time as the economy recovers subject 

to limitations established by the Board when 

such conditions return to normal. 

f 

PRIVILEGES OF THE FLOOR 

Mr. DORGAN. I ask unanimous consent that Jon Cary, a legislative fellow 

in my office, be allowed the privilege of 

the floor during debate on H.R. 7801. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

Mr. DODD. I ask unanimous consent 

that the following fellows, law clerks, 

and interns on the staff of the Finance 

Committee be granted the privileges of 

the floor for the duration of the debate 

on economic stabilization, tax extenders, and energy: Bridget Mallon, Mary 

Baker, Sean Thomas, and Kelcy 

Poulson. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

Mr. REED. I ask unanimous consent 

that a detailee to the Committee on 

Banking, Housing, and Urban Affairs, 

Robert Lee, be granted the privileges of 

the floor for the remainder of this session. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

Mr. DODD. I ask unanimous consent 

that Eric Reither, from Senator ENSIGN’s office, be granted the privilege of 

the floor. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

f 

CORRECTING THE ENROLLMENT 

OF H.R. 6063 

Mr. DURBIN. Mr. President, I ask 

unanimous consent that the Senate 

proceed to the immediate consideration of S. Con. Res. 105, submitted 

earlier today. 

The PRESIDING OFFICER. The 

clerk will report the concurrent resolution by title. 

The legislative clerk read as follows: 

A concurrent resolution (S. Con. Res. 105) 

directing the Clerk of the House of Representatives to correct the enrollment of 

H.R. 6063. 

There being no objection, the Senate 

proceeded to consider the concurrent 

resolution. 

Mr. DURBIN. Mr. President, I ask 

unanimous consent that the concurrent resolution be agreed to, the motion to reconsider be laid upon the 

table, with no intervening action or debate, and any statements related to the 

measure be printed in the RECORD. 

The PRESIDING OFFICER. Without 

objection, it is so ordered. 

The concurrent resolution (S. Con. 

Res. 105) was agreed to, as follows: 

S. CON. RES. 105 

Resolved by the Senate (the House of Representatives concurring), That in the enrollment of the bill H.R. 6063, an Act to authorize the programs of the National Aeronautics 

and Space Administration, and for other purposes, the Clerk of the House of Representatives shall make the following corrections: 

In section 601(b)(2)(A)(iii) of the bill, strike 

‘‘Orbiter’’. 

In section 611(d)(1) of the bill, strike ‘‘first 

President’’ and insert ‘‘President’’. 

In section 611(e)(3) of the bill, strike ‘‘correctly’’ and insert ‘‘currently’’. 

In section 611(e)(7) of the bill, strike 

‘‘extention’’ and insert ‘‘extension’’. 

In section 612 of the bill, strike ‘‘operations’’ and insert ‘‘operational’’. 

In section 1119 of the bill, strike ‘‘The Report’’ and insert ‘‘The report’’. 

f 

TRAFFICKING IN PERSONS 

ACCOUNTABILITY ACT OF 2007 

Mr. DURBIN. Mr. President, I ask 

unanimous consent that the Senate 

proceed to the immediate consideration of Calendar No. 903, S. 1703. 

The PRESIDING OFFICER. The 

clerk will report the bill by title. 

The legislative clerk read as follows: 

A bill (S. 1703) to prevent and reduce trafficking in persons. 

There being no objection, the Senate 

proceeded to consider the bill, which 


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