I

107TH CONGRESS

1ST SESSION H. R. 1270

To increase accountability for Government spending and to reduce wasteful

Government spending.

IN THE HOUSE OF REPRESENTATIVES

MARCH 28, 2001

Mr. DEFAZIO introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Energy

and Commerce, Armed Services, Science, Resources, Financial Services,

International Relations, Veterans’ Affairs, and Intelligence (Permanent

Select), for a period to be subsequently determined by the Speaker, in

each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

A BILL

To increase accountability for Government spending and to

reduce wasteful Government spending.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

4 (a) SHORT TITLE.—This Act may be cited as the

5 ‘‘Comprehensive Fiscal Responsibility and Accountability

6 Act of 2001’’.

7 (b) TABLE OF CONTENTS.—The table of contents of

8 this Act is as follows:
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Sec. 1. Short title; table of contents.

TITLE I—INCREASED ACCOUNTABILITY AND REDUCTION IN

MEDICARE WASTE AND FRAUD

Sec. 101. Increased medical reviews and antifraud activities.

Sec. 102. Expansion of medicare senior waste patrol nationwide.

Sec. 103. Application of inherent reasonableness to all Part B services other

than physicians’ services.

Sec. 104. Implementation of commercial claims auditing systems.

TITLE II—INCREASED ACCOUNTABILITY AND REDUCTION OF

WASTEFUL DEFENSE SPENDING

Sec. 201. Cancellation of F–22 aircraft program.

Sec. 202. Cancellation of Comanche helicopter program.

Sec. 203. Cancellation of Crusader artillery program.

Sec. 204. Cancellation of V–22 aircraft program.

Sec. 205. Limitation on procurement of Virginia class attack submarines.

Sec. 206. Termination of production of Trident D5 missiles.

Sec. 207. Reduction in nuclear delivery systems within overall limits of START

II.

Sec. 208. Creation of common NATO airlift capability and reduction of United

States costs for C–17 aircraft.

Sec. 209. Deferral of procurement of additional C–130 tactical airlift planes.

Sec. 210. Reduction in requirements for Air Force and Navy pilots in nonflying

positions.

Sec. 211. Reduction in number of officers so as to return to enlisted-to-officer

ratio in existence in 1989.

Sec. 212. Placement of Selective Service System in ‘‘deep standby’’ status.

Sec. 213. End of taxpayer support for defense industry mergers.

Sec. 214. Reduction of United States support for weapons sales abroad by

eliminating future assistance under the Foreign Military Financing program.

Sec. 215. Limitation on proposed increases for National Missile Defense to fiscal year 2000 levels.

Sec. 216. Reduction of Central Intelligence Agency budget by 10 percent.

TITLE III—REDUCTION AND REFORM OF ANTIENVIRONMENTAL

SPENDING

Subtitle A—Program Terminations and Fees

Sec. 301. Nuclear Energy Research Initiative.

Sec. 302. National Ignition Facility.

Sec. 303. Tokamak Fusion Reactors.

Sec. 304. Diesel engine research.

Sec. 305. Nuclear waste fund fee.

Subtitle B—Mining Provisions

Sec. 311. Definitions.

Sec. 312. Royalties.

Sec. 313. Limitation on patent issuance.

Sec. 314. Mining claim maintenance requirements.

Sec. 315. Savings clause.
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TITLE IV—AMENDMENTS OF INTERNAL REVENUE CODE OF 1986

Sec. 401. Repeal of exclusion of certain income of foreign sales corporations.

Sec. 402. Denial of deduction for payments of excessive compensation.

Sec. 403. Disallowance of deductions for advertising and promotional expenses

relating to tobacco product use.

Sec. 404. Source of income from certain sales of inventory property.

TITLE V—MISCELLANEOUS PROVISIONS TO REDUCE WASTEFUL

AND INEFFICIENT SPENDING

Sec. 501. International space station.

Sec. 502. Overseas Private Investment Corporation.

Sec. 503. Prohibition on provision of new credit by the Export-Import Bank of

the United States.

Sec. 504. Trade and Development Agency.

Sec. 505. Termination of international broadcasting authorities.

Sec. 506. Joint procurement of pharmaceuticals by the Department of Defense

and the Department of Veterans Affairs.

1 TITLE I—INCREASED ACCOUNT2 ABILITY AND REDUCTION IN

3 MEDICARE WASTE AND

4 FRAUD

5 SEC. 101. INCREASED MEDICAL REVIEWS AND ANTIFRAUD

6 ACTIVITIES.

7 Section 1893(d) of the Social Security Act (42 U.S.C.

8 1395ddd(d)) is amended by inserting after paragraph (3)

9 the following:

10 ‘‘(4) In the case of the year 2002 and each sub11 sequent year, procedures to ensure that—

12 ‘‘(A) the number of medical reviews, utili13 zation reviews, and fraud reviews in a fiscal

14 year of providers of services and other individ15 uals and entities furnishing items and services

16 for which payment may be made under this title

17 (as a percentage of total claims paid) is equal
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1 to at least twice the number of such reviews

2 that were conducted in fiscal year 2000;

3 ‘‘(B) the number of provider cost reports

4 audited in a fiscal year is equal to at least—

5 ‘‘(i) 15 percent of those submitted by

6 a home health agency or a skilled nursing

7 facility; and

8 ‘‘(ii) twice the number of such reports

9 that were audited in fiscal year 2000 for

10 those submitted by any other provider of

11 services or any other individual or entity

12 furnishing items and services for which

13 payment may be made under this title; and

14 ‘‘(C) in determining which providers of

15 services, individuals, entities, or cost reports to

16 review or audit, priority is placed on providers,

17 individuals, entities, and areas that the Sec18 retary determines are subject to abuse and

19 most likely to result in mispayment or overpay20 ment recoveries.’’.

21 SEC. 102. EXPANSION OF MEDICARE SENIOR WASTE PA22 TROL NATIONWIDE.

23 There are authorized to be appropriated $25,000,000

24 in fiscal year 2002, and such sums as are necessary for

25 fiscal years 2003 through 2005, for the purpose of car-
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1 rying out, and expanding nationwide, the Health Care

2 Anti-Fraud, Waste and Abuse Community Volunteer

3 Demonstration Projects conducted by the Administration

4 on Aging pursuant to the Omnibus Consolidated Appro5 priations Act, 1997 (Public Law 104–208).

6 SEC. 103. APPLICATION OF INHERENT REASONABLENESS

7 TO ALL PART B SERVICES OTHER THAN PHY8 SICIANS’ SERVICES.

9 (a) REPEAL OF CERTAIN PROVISIONS OF THE BAL10 ANCED BUDGET ACT OF 1997.—

11 (1) REPEAL.—Section 4316 of the Balanced

12 Budget Act of 1997 (Public Law 105–33; 111 Stat.

13 390), and the amendments made by such section,

14 are repealed effective August 5, 1997.

15 (2) APPLICABILITY.—Effective August 5, 1997,

16 the Social Security Act shall be applied and adminis17 tered as if section 4316 of the Balanced Budget Act

18 of 1997 (Public Law 105–33; 111 Stat. 390), and

19 the amendments made by such section, had not been

20 enacted.

21 (b) APPLICATION OF INHERENT REASONABLENESS

22 TO ALL PART B SERVICES OTHER THAN PHYSICIANS’

23 SERVICES.—
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1 (1) IN GENERAL.—Section 1842(b)(8) of the

2 Social Security Act (42 U.S.C. 1395u(b)(8)) is

3 amended to read as follows:

4 ‘‘(8) The Secretary shall describe by regulation the

5 factors to be used in determining the cases (of particular

6 items or services) in which the application of this part

7 (other than to physicians’ services paid under section

8 1848) results in the determination of an amount that, be9 cause of its being grossly excessive or grossly deficient,

10 is not inherently reasonable, and provide in those cases

11 for the factors to be considered in establishing an amount

12 that is realistic and equitable.’’.

13 (2) EFFECTIVE DATE.—The amendment made

14 by this subsection shall take effect August 5, 1997.

15 SEC. 104. IMPLEMENTATION OF COMMERCIAL CLAIMS AU16 DITING SYSTEMS.

17 (a) COMMERCIAL CLAIMS AUDITING SYSTEMS.—

18 (1) IN GENERAL.—Not later than 90 days after

19 the date of enactment of this Act, the Secretary

20 shall require medicare carriers to use commercial

21 claims auditing systems in the processing of claims

22 under part B of the medicare program under title

23 XVIII of the Social Security Act (42 U.S.C. 1395j

24 et seq.) for the purpose of identifying billing errors

25 and abuses.
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1 (2) SUPPLEMENT TO OTHER TECHNOLOGY.—

2 Commercial claims auditing systems required under

3 paragraph (1) shall be used as a supplement to any

4 other information technology used by medicare car5 riers in processing claims under the medicare pro6 gram.

7 (3) UNIFORMITY.—In order to ensure uni8 formity in processing claims under the medicare pro9 gram, the Secretary may require that medicare car10 riers utilize 1 or more common commercial claims

11 auditing systems, provided that the selection of such

12 system or systems by the Secretary shall be—

13 (A) after due consideration of competing

14 alternative systems; but

15 (B) without regard to any provision of law

16 that requires the use of competitive procedures

17 (as defined in section 4 of the Office of Federal

18 Procurement Policy Act (41 U.S.C. 403)) or

19 the publication of notice of proposed procure20 ments.

21 (4) IMPLEMENTATION.—Commercial claims au22 diting systems required under paragraph (1) shall be

23 implemented by all medicare carriers by not later

24 than 180 days after the date of enactment of this

25 Act.
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1 (b) MINIMUM SOFTWARE REQUIREMENTS.—Any

2 commercial claims auditing system required to be imple3 mented pursuant to subsection (a) shall, at a minimum—

4 (1) be a commercial item;

5 (2) surpass the capability of systems currently

6 used in the processing of claims under part B of the

7 medicare program; and

8 (3) be modifiable to—

9 (A) satisfy pertinent statutory require10 ments of the medicare program; and

11 (B) conform to policies of the Secretary re12 garding claims processing under such program.

13 (c) DISCLOSURE.—

14 (1) IN GENERAL.—Except as provided in para15 graph (2), notwithstanding any other provision of

16 law, any information technology (or data related

17 thereto) utilized by medicare carriers in establishing

18 a commercial claims auditing system pursuant to

19 subsection (a) shall not be subject to public disclo20 sure.

21 (2) AUTHORIZED DISCLOSURE.—The Secretary

22 may authorize the public disclosure of the informa23 tion described in paragraph (1) if the Secretary de24 termines that—
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1 (A) release of such information is in the

2 public interest; and

3 (B) the information to be released is not

4 protected from disclosure under section 552(b)

5 of title 5, United States Code.

6 (d) DEFINITIONS.—In this section—

7 (1) COMMERCIAL CLAIMS AUDITING SYSTEM.—

8 The term ‘‘commercial claims auditing system’’

9 means a commercial specialized auditing system that

10 includes edits which identify inappropriately coded

11 health care claims.

12 (2) COMMERCIAL ITEM.—The term ‘‘commer13 cial item’’ has the meaning given such term in sec14 tion 4 of the Office of Federal Procurement Policy

15 Act (41 U.S.C. 403).

16 (3) INFORMATION TECHNOLOGY.—The term

17 ‘‘information technology’’ has the meaning given

18 such term in subparagraphs (A) and (B) of section

19 5002(3) of the Information Technology Management

20 Reform Act of 1996 (40 U.S.C. 1401(3)), were such

21 information technology to be acquired by an execu22 tive agency.

23 (4) MEDICARE CARRIER.—The term ‘‘medicare

24 carrier’’ means an entity that has a contract with
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1 the Secretary pursuant to section 1842(a) of the So2 cial Security Act (42 U.S.C. 1395u(a)).

3 (5) SECRETARY.—The term ‘‘Secretary’’ means

4 the Secretary of Health and Human Services.

5 TITLE II—INCREASED ACCOUNT6 ABILITY AND REDUCTION OF

7 WASTEFUL DEFENSE SPEND8 ING

9 SEC. 201. CANCELLATION OF F–22 AIRCRAFT PROGRAM.

10 The Secretary of the Air Force shall cancel the F–

11 22 Raptor aircraft program. No funds may be obligated

12 for that program after the date of the enactment of this

13 Act.

14 SEC. 202. CANCELLATION OF COMANCHE HELICOPTER

15 PROGRAM.

16 The Secretary of the Army shall cancel the Comanche

17 helicopter program. No funds may be obligated for that

18 program after the date of the enactment of this Act.

19 SEC. 203. CANCELLATION OF CRUSADER ARTILLERY PRO20 GRAM.

21 The Secretary of the Army shall cancel the Crusader

22 artillery program. No funds may be obligated for that pro23 gram after the date of the enactment of this Act.
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1 SEC. 204. CANCELLATION OF V–22 AIRCRAFT PROGRAM.

2 The Secretary of the Navy shall cancel the V–22 Os3 prey aircraft program. No funds may be obligated for that

4 program after the date of the enactment of this Act.

5 SEC. 205. LIMITATION ON PROCUREMENT OF VIRGINIA

6 CLASS ATTACK SUBMARINES.

7 Through fiscal year 2010, the Secretary of the Navy

8 may enter into contracts for the procurement of no more

9 than eight Virginia class submarines (including contracts

10 entered into before the date of the enactment of this Act).

11 SEC. 206. TERMINATION OF PRODUCTION OF TRIDENT D5

12 MISSILES.

13 No funds may be obligated after the date of the en14 actment of this Act for production of Trident D5 missiles.

15 SEC. 207. REDUCTION IN NUCLEAR DELIVERY SYSTEMS

16 WITHIN OVERALL LIMITS OF START II.

17 The President shall take such steps as necessary to

18 reduce the nuclear delivery systems of the United States

19 so as to bring the number of such systems within the over20 all START II limits. For purposes of this section, the term

21 ‘‘overall START II limits’’ means the limitations on nu22 clear delivery systems that would be in effect under the

23 START II Treaty, if ratified.
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1 SEC. 208. CREATION OF COMMON NATO AIRLIFT CAPA2 BILITY AND REDUCTION OF UNITED STATES

3 COSTS FOR C–17 AIRCRAFT.

4 The Secretary of Defense shall seek to reach an

5 agreement with the other member nations of the North

6 Atlantic Treaty Organization to establish a common

7 NATO airlift capability consisting of 20 C–17 aircraft

8 with a cost-sharing arrangement similar to that for the

9 common NATO AWACS fleet. The 20 C–17 aircraft pro10 grammed by the Air Force for procurement in fiscal years

11 2002 and 2003 shall be transferred to NATO for that

12 common NATO airlift capability upon such an agreement

13 being entered into.

14 SEC. 209. DEFERRAL OF PROCUREMENT OF ADDITIONAL C–

15 130 TACTICAL AIRLIFT PLANES.

16 The Secretary of the Air Force may not enter into

17 a contract for procurement of additional C–130 aircraft

18 for fiscal years 2002 through 2006.

19 SEC. 210. REDUCTION IN REQUIREMENTS FOR AIR FORCE

20 AND NAVY PILOTS IN NONFLYING POSITIONS.

21 The Secretary of the Air Force and the Secretary of

22 the Navy shall each evaluate nonflying positions in the Air

23 Force and the Navy, respectively, that are currently re24 quired to be held by pilots and, to the maximum extent

25 practicable, shall modify the qualifications for those posi-
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1 tions to reduce the requirements for pilots for those posi2 tions.

3 SEC. 211. REDUCTION IN NUMBER OF OFFICERS SO AS TO

4 RETURN TO ENLISTED-TO-OFFICER RATIO IN

5 EXISTENCE IN 1989.

6 The Secretary of Defense shall implement a program

7 to reduce the ratio of enlisted-to-officer personnel of each

8 of the Army, Navy, Air Force, and Marine Corps to a ratio

9 of at least six-to-one by not later than January 1, 2006.

10 The Secretary shall carry out that program through re11 ductions in officer promotions to general and flag officer

12 grades and through reductions in the number of officers

13 in pay grades O–4, O–5, and O–6 through voluntary pro14 grams under existing provisions of law, including tem15 porary early retirement authority, voluntary separation in16 centive, and the special separation benefit.

17 SEC. 212. PLACEMENT OF SELECTIVE SERVICE SYSTEM IN

18 ‘‘DEEP STANDBY’’ STATUS.

19 (a) RESTRICTION OF REGISTRATION REQUIREMENT

20 TO PERIODS OF NATIONAL EMERGENCIES.—(1) Section

21 3(a) of the Military Selective Service Act (50 U.S.C. App.

22 453(a)) is amended by inserting after ‘‘this title,’’ the fol23 lowing: ‘‘during any period in which a declaration of na24 tional emergency is in effect,’’.
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1 (2) Section 3 of such Act (50 U.S.C. App. 453) is

2 further amended by adding at the end the following new

3 subsections:

4 ‘‘(c) The President shall have the authority to declare

5 a period of national emergency during which the registra6 tion requirements of subsection (a) shall apply. Subject

7 to subsection (d), the President shall provide for the

8 prompt termination of the declaration of national emer9 gency upon the termination of the national emergency.

10 ‘‘(d) A declaration of national emergency under sub11 section (c) shall terminate upon the expiration of a 10-

12 day period of continuous session of Congress after the

13 date of the declaration unless Congress enacts a law before

14 the end of that period ratifying that specific declaration.

15 For purposes of this subsection, the continuity of a session

16 of Congress is broken only by an adjournment of the Con17 gress sine die, and the days on which either House is not

18 in session because of an adjournment of more than three

19 days to a day certain are excluded in the computation of

20 the 10-day period.’’.

21 (3) Section 12 of such Act (50 U.S.C. App. 462) is

22 amended by adding at the end the following new sub23 section:

24 ‘‘(h) In addition to the exception provided by sub25 section (g), a person may not be denied a right, privilege,
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1 benefit, or employment position under Federal law on the

2 grounds that the person failed to present himself for and

3 submit to registration under section 3 before the date of

4 the enactment of this subsection.’’.

5 (b) SUSPENSION OF ACTIVITIES OF SELECTIVE

6 SERVICE SYSTEM BOARDS.—Section 17 of such Act (50

7 U.S.C. App. 467) is amended by adding at the end the

8 following new subsection:

9 ‘‘(d) Except during any period in which a declaration

10 of national emergency is in effect under section 3—

11 ‘‘(1) the President may not appoint a person as

12 a member of a civilian local board, civilian appeal

13 board, or similar local agency of the Selective Serv14 ice System; and

15 ‘‘(2) any such board established under section

16 10(b)(3) may not meet.’’.

17 (c) REPORT ON STANDBY REGISTRATION PROGRAM

18 FOR USE DURING NATIONAL EMERGENCIES.—Not later

19 than 150 days after the date of the enactment of this Act,

20 the Director of the Selective Service System shall submit

21 to Congress a report detailing a standby emergency man22 power mobilization program to be used by the Selective

23 Service System during periods in which a declaration of

24 national emergency is in effect for the registration of per25 sons who would be subject to registration under section
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1 3 of the Military Selective Service Act (50 U.S.C. App.

2 453) during such a period. The report shall include an

3 estimate of the cost to implement and operate the standby

4 program and an evaluation of the feasibility of using exist5 ing and emerging information systems available to the

6 Government to improve the effectiveness of any registra7 tion requirements.

8 SEC. 213. END OF TAXPAYER SUPPORT FOR DEFENSE IN9 DUSTRY MERGERS.

10 Expenses incurred by a defense contractor related to

11 a corporate merger may not be considered to be an allow12 able cost under a Department of Defense contract, and

13 no funds appropriated to the Department of Defense may

14 be used to reimburse a contractor for any such expense.

15 SEC. 214. REDUCTION OF UNITED STATES SUPPORT FOR

16 WEAPONS SALES ABROAD BY ELIMINATING

17 FUTURE ASSISTANCE UNDER THE FOREIGN

18 MILITARY FINANCING PROGRAM.

19 After the date of the enactment of this Act, no new

20 loan, grant, or other assistance may be provided under the

21 ‘‘Foreign Military Financing Program’’ account under

22 section 23 of the Arms Export Control Act (22 U.S.C.

23 2763).
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1 SEC. 215. LIMITATION ON PROPOSED INCREASES FOR NA2 TIONAL MISSILE DEFENSE TO FISCAL YEAR

3 2000 LEVELS.

4 The amount appropriated for the National Missile

5 Defense program of the Department of Defense for any

6 fiscal year may not exceed the amount appropriated for

7 that program for fiscal year 2000, adjusted for inflation.

8 SEC. 216. REDUCTION OF CENTRAL INTELLIGENCE AGENCY

9 BUDGET BY 10 PERCENT.

10 The total amount obligated for programs and activi11 ties of the Central Intelligence Agency for fiscal year 2002

12 may not exceed 90 percent of the total amount obligated

13 for programs and activities of the Central Intelligence

14 Agency for fiscal year 2001.

15 TITLE III—REDUCTION AND RE16 FORM OF ANTIENVIRONMEN

17 TAL SPENDING

18 Subtitle A—Program Terminations

19 and Fees

20 SEC. 301. NUCLEAR ENERGY RESEARCH INITIATIVE.

21 The Department of Energy shall not obligate any fur22 ther funding for the Nuclear Energy Research Initiative.

23 SEC. 302. NATIONAL IGNITION FACILITY.

24 The Department of Energy shall not obligate any fur25 ther funding for the National Ignition Facility.
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1 SEC. 303. TOKAMAK FUSION REACTORS.

2 The Department of Energy shall not obligate any fur3 ther funding for Tokamak fusion reactors.

4 SEC. 304. DIESEL ENGINE RESEARCH.

5 The Department of Energy shall not obligate any fur6 ther funding for research on diesel engines for cars and

7 light trucks.

8 SEC. 305. NUCLEAR WASTE FUND FEE.

9 (a) FEE ADJUSTMENT.—Section 302(a)(2) of the

10 Nuclear Waste Policy Act of 1982 is amended by adding

11 at the end the following new sentence: ‘‘The Secretary

12 shall adjust the fee annually for inflation.’’.

13 (b) EFFECTIVE DATE.—The amendment made by

14 subsection (a) shall take effect 90 days after the date of

15 enactment of this section.

16 Subtitle B—Mining Provisions

17 SEC. 311. DEFINITIONS.

18 For purposes of subtitle:

19 (1) The term ‘‘locatable mineral’’ means any

20 mineral not subject to disposition under any of the

21 following:

22 (A) The Mineral Leasing Act (30 U.S.C.

23 181 et seq.).

24 (B) The Geothermal Steam Act of 1970

25 (30 U.S.C. 100 et seq.).
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1 (C) The Act of July 31, 1947, commonly

2 known as the Materials Act of 1947 (30 U.S.C.

3 601 et seq.).

4 (D) The Mineral Leasing for Acquired

5 Lands Act (30 U.S.C. 351 et seq.).

6 (2) The term ‘‘mineral activities’’ means any

7 activity for, related to or incidental to mineral explo8 ration, mining, beneficiation and processing activi9 ties for any locatable mineral, including access.

10 When used with respect to this term:

11 (A) The term ‘‘exploration’’ means those

12 techniques employed to locate the presence of a

13 locatable mineral deposit and to establish its

14 nature, position, size, shape, grade and value.

15 (B) The term ‘‘mining’’ means the proc16 esses employed for the extraction of a locatable

17 mineral from the earth.

18 (C) The term ‘‘beneficiation’’ means the

19 crushing and grinding of locatable mineral ore

20 and such processes as are employed to free the

21 mineral from other constituents, including but

22 not necessarily limited to, physical and chemical

23 separation techniques.

24 (D) The term ‘‘processing’’ means proc25 esses downstream of beneficiation employed to
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1 prepare locatable mineral ore into the final

2 marketable product, including but not limited

3 to, smelting and electrolytic refining.

4 (3) The term ‘‘mining claim’’ means a claim for

5 the purposes of mineral activities.

6 (4) The term ‘‘net smelter return’’ shall have

7 the same meaning as the term defined in section

8 613(c)(1) of the Internal Revenue Code.

9 (5) The term ‘‘Secretary’’ means the Secretary

10 of the Interior acting through the Director of the

11 Minerals Management Service.

12 (6) The term ‘‘substantial underreporting’’

13 means the difference between the royalty on the

14 value of the production which should have been re15 ported and the royalty on the value of the produc16 tion which was reported, if the value which should

17 have been reported is greater than the value which

18 was reported. An underreporting constitutes a ‘‘sub19 stantial underreporting’’ if such difference exceeds

20 10 percent of the royalty on the value of production

21 which should have been reported.

22 SEC. 312. ROYALTIES.

23 (a) RESERVATION OF ROYALTY.—Production of all

24 locatable minerals from any mining claim located or con25 verted under the general mining laws, or mineral con-
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1 centrates or products derived from locatable minerals from

2 any mining claim located or converted under the general

3 mining laws, as the case may be, shall be subject to a

4 royalty of 8 percent of the net smelter return from such

5 production. The claim holder and any operator to whom

6 the claim holder has assigned the obligation to make roy7 alty payments under the claim and any person who con8 trols such claim holder or operator shall be jointly and

9 severally liable for payment of such royalties.

10 (b) DUTIES OF CLAIM HOLDERS, OPERATORS, AND

11 TRANSPORTERS.—(1) A person—

12 (A) who is required to make any royalty pay13 ment under this section shall make such payments

14 to the United States at such times and in such man15 ner as the Secretary may by rule prescribe; and

16 (B) shall notify the Secretary, in the time and

17 manner as may be specified by the Secretary, of any

18 assignment that such person may have made of the

19 obligation to make any royalty or other payment

20 under a mining claim.

21 (2) Any person paying royalties under this section

22 shall file a written instrument, together with the first roy23 alty payment, affirming that such person is liable to the

24 Secretary for making proper payments for all amounts due

25 for all time periods for which such person as a payment
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1 responsibility. Such liability for the period referred to in

2 the preceding sentence shall include any and all additional

3 amounts billed by the Secretary and determined to be due

4 by final agency or judicial action. Any person liable for

5 royalty payments under this section who assigns any pay6 ment obligation shall remain jointly and severally liable

7 for all royalty payments due for the claim for the period.

8 (3) A person conducting mineral activities shall—

9 (A) develop and comply with the site security

10 provisions in operations permit designed to protect

11 from theft the locatable minerals, concentrates or

12 products derived therefrom which are produced or

13 stored on a mining claim, and such provisions shall

14 conform with such minimum standards as the Sec15 retary may prescribe by rule, taking into account the

16 variety of circumstances on mining claims; and

17 (B) not later than the 5th business day after

18 production begins anywhere on a mining claim, or

19 production resumes after more than 90 days after

20 production was suspended, notify the Secretary, in

21 the manner prescribed by the Secretary, of the date

22 on which such production has begun or resumed.

23 (4) The Secretary may by rule require any person en24 gaged in transporting a locatable mineral, concentrate, or

25 product derived therefrom to carry on his or her person,
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1 in his or her vehicle, or in his or her immediate control,

2 documentation showing, at a minimum, the amount, ori3 gin, and intended destination of the locatable mineral, con4 centrate, or product derived therefrom in such cir5 cumstances as the Secretary determines is appropriate.

6 (c) RECORDKEEPING AND REPORTING REQUIRE7 MENTS.—(1) A claim holder, operator, or other person di8 rectly involved in developing, producing, processing, trans9 porting, purchasing, or selling locatable minerals, con10 centrates, or products derived therefrom, subject to this

11 Act, through the point of royalty computation shall estab12 lish and maintain any records, make any reports, and pro13 vide any information that the Secretary may reasonably

14 require for the purposes of implementing this section or

15 determining compliance with rules or orders under this

16 section. Such records shall include, but not be limited to,

17 periodic reports, records, documents, and other data. Such

18 reports may also include, but not be limited to, pertinent

19 technical and financial data relating to the quantity, qual20 ity, composition volume, weight, and assay of all minerals

21 extracted from the mining claim. Upon the request of any

22 officer or employee duly designated by the Secretary or

23 any State conducting an audit or investigation pursuant

24 to this section, the appropriate records, reports, or infor25 mation which may be required by this section shall be
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1 made available for inspection and duplication by such offi2 cer or employee or State.

3 (2) Records required by the Secretary under this sec4 tion shall be maintained for 6 years after cessation of all

5 mining activity at the claim concerned unless the Sec6 retary notifies the operator that he or she has initiated

7 an audit or investigation involving such records and that

8 such records must be maintained for a longer period. In

9 any case when an audit or investigation is underway,

10 records shall be maintained until the Secretary releases

11 the operator of the obligation to maintain such records.

12 (d) AUDITS.—The Secretary is authorized to conduct

13 such audits of all claim holders, operators, transporters,

14 purchasers, processors, or other persons directly or indi15 rectly involved in the production or sales of minerals cov16 ered by this Act, as the Secretary deems necessary for the

17 purposes of ensuring compliance with the requirements of

18 this section. For purposes of performing such audits, the

19 Secretary shall, at reasonable times and upon request,

20 have access to, and may copy, all books, papers and other

21 documents that relate to compliance with any provision

22 of this section by any person.

23 (e) COOPERATIVE AGREEMENTS.—(1) The Secretary

24 is authorized to enter into cooperative agreements with the

25 Secretary of Agriculture to share information concerning
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1 the royalty management of locatable minerals, con2 centrates, or products derived therefrom, to carry out in3 spection, auditing, investigation, or enforcement (not in4 cluding the collection of royalties, civil or criminal pen5 alties, or other payments) activities under this section in

6 cooperation with the Secretary, and to carry out any other

7 activity described in this section.

8 (2) Except as provided in paragraph (4)(A) of this

9 subsection (relating to trade secrets), and pursuant to a

10 cooperative agreement, the Secretary of Agriculture shall,

11 upon request, have access to all royalty accounting infor12 mation in the possession of the Secretary respecting the

13 production, removal, or sale of locatable minerals, con14 centrates, or products derived therefrom from claims on

15 lands open to location under the general mining laws.

16 (3) Trade secrets, proprietary, and other confidential

17 information shall be made available by the Secretary pur18 suant to a cooperative agreement under this subsection to

19 the Secretary of Agriculture upon request only if—

20 (A) the Secretary of Agriculture consents in

21 writing to restrict the dissemination of the informa22 tion to those who are directly involved in an audit

23 or investigation under this section and who have a

24 need to know;
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1 (B) the Secretary of Agriculture accepts liabil2 ity for wrongful disclosure; and

3 (C) the Secretary of Agriculture demonstrates

4 that such information is essential to the conduct of

5 an audit or investigation under this subsection.

6 (f) INTEREST AND SUBSTANTIAL UNDERREPORTING

7 ASSESSMENTS.—(1) In the case of mining claims where

8 royalty payments are not received by the Secretary on the

9 date that such payments are due, the Secretary shall

10 charge interest on such underpayments at the same inter11 est rate as is applicable under section 6621(a)(2) of the

12 Internal Revenue Code of 1986. In the case of an under13 payment, interest shall be computed and charged only on

14 the amount of the deficiency and not on the total amount.

15 (2) If there is any underreporting of royalty owed on

16 production from a claim for any production month by any

17 person liable for royalty payments under this section, the

18 Secretary may assess a penalty of 10 percent of the

19 amount of that underreporting.

20 (3) If there is a substantial underreporting of royalty

21 owed on production from a claim for any production

22 month by any person responsible for paying the royalty,

23 the Secretary may assess a penalty of 10 percent of the

24 amount of that underreporting.
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1 (4) The Secretary shall not impose the assessment

2 provided in paragraph (2) or (3) of this subsection if the

3 person liable for royalty payments under this section cor4 rects the underreporting before the date such person re5 ceives notice from the Secretary that an underreporting

6 may have occurred, or before 90 days after the date of

7 the enactment of this section, whichever is later.

8 (5) The Secretary shall waive any portion of an as9 sessment under paragraph (2) or (3) of this subsection

10 attributable to that portion of the underreporting for

11 which the person responsible for paying the royalty dem12 onstrates that—

13 (A) such person had written authorization from

14 the Secretary to report royalty on the value of the

15 production on basis on which it was reported;

16 (B) such person had substantial authority for

17 reporting royalty on the value of the production on

18 the basis on which it was reported;

19 (C) such person previously had notified the Sec20 retary, in such manner as the Secretary may by rule

21 prescribe, of relevant reasons or facts affecting the

22 royalty treatment of specific production which led to

23 the underreporting; or

24 (D) such person meets any other exception

25 which the Secretary may, by rule, establish.
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1 (6) All penalties collected under this subsection shall

2 be deposited in the Treasury.

3 (g) EXPANDED ROYALTY OBLIGATIONS.—Each per4 son liable for royalty payments under this section shall

5 be jointly and severally liable for royalty on all locatable

6 minerals, concentrates, or products derived therefrom lost

7 or wasted from a mining claim located or converted under

8 this section when such loss or waste is due to negligence

9 on the part of any person or due to the failure to comply

10 with any rule, regulation, or order issued under this sec11 tion.

12 (h) EXCEPTION.—No royalty shall be payable under

13 subsection (a) with respect to minerals processed at a fa14 cility by the same person or entity which extracted the

15 minerals if an urban development action grant has been

16 made under section 119 of the Housing and Community

17 Development Act of 1974 with respect to any portion of

18 such facility.

19 (i) EFFECTIVE DATE.—The royalty under this sec20 tion shall take effect with respect to the production of

21 locatable minerals after the enactment of this Act, but any

22 royalty payments attributable to production during the

23 first 12 calendar months after the enactment of this sec24 tion shall be payable at the expiration of such 12-month

25 period.
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1 SEC. 313. LIMITATION ON PATENT ISSUANCE.

2 (a) MINING CLAIMS.—After llll, 2001, no pat3 ent shall be issued by the United States for any mining

4 claim located under the general mining laws or under this

5 Act unless the Secretary determines that, for the claim

6 concerned—

7 (1) a patent application was filed with the Sec8 retary on or before llll, 2001; and

9 (2) all requirements established under sections

10 2325 and 2326 of the Revised Statutes (30 U.S.C.

11 29 and 30) for vein or lode claims and sections

12 2329, 2330, 2331, and 2333 of the Revised Statutes

13 (30 U.S.C. 35, 36, and 37) for placer claims were

14 fully complied with by that date.

15 If the Secretary makes the determinations referred to in

16 paragraphs (1) and (2) for any mining claim, the holder

17 of the claim shall be entitled to the issuance of a patent

18 in the same manner and degree to which such claim holder

19 would have been entitled to prior to the enactment of this

20 Act, unless and until such determinations are withdrawn

21 or invalidated by the Secretary or by a court of the United

22 States.

23 (b) MILL SITES.—After llll, 2001, no patent

24 shall be issued by the United States for any mill site claim

25 located under the general mining laws unless the Secretary

26 determines that for the mill site concerned—
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1 (1) a patent application for such land was filed

2 with the Secretary on or before llll, 2001;

3 and

4 (2) all requirements applicable to such patent

5 application were fully complied with by that date.

6 If the Secretary makes the determinations referred to in

7 paragraphs (1) and (2) for any mill site claim, the holder

8 of the claim shall be entitled to the issuance of a patent

9 in the same manner and degree to which such claim holder

10 would have been entitled to prior to the enactment of this

11 section, unless and until such determinations are with12 drawn or invalidated by the Secretary or by a court of

13 the United States.

14 SEC. 314. MINING CLAIM MAINTENANCE REQUIREMENTS.

15 (a) IN GENERAL.—(1) The holder of each mining

16 claim converted under the general mining laws shall pay

17 to the Secretary an annual claim maintenance fee of $100

18 per claim.

19 (2) The holder of each mining claim located pursuant

20 to the general mining laws shall pay to the Secretary an

21 annual claim maintenance fee of $200 per claim.

22 (b) TIME OF PAYMENT.—The claim maintenance fee

23 payable pursuant to subsection (a) for any year shall be

24 paid on or before August 31 of each year, except that in

25 the case of claims referred to in subsection (a)(2), for the
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1 initial calendar year in which the location is made, the

2 locator shall pay the initial claim maintenance fee at the

3 time the location notice is recorded with the Bureau of

4 Land Management.

5 (c) OIL SHALE CLAIMS SUBJECT TO CLAIM MAINTE6 NANCE FEES UNDER ENERGY POLICY ACT OF 1992.—

7 This section shall not apply to any oil shale claims for

8 which a fee is required to be paid under section 2511(e)(2)

9 of the Energy Policy Act of 1992 (Public Law 102–486;

10 106 Stat. 3111; 30 U.S.C. 242).

11 (d) CLAIM MAINTENANCE FEES PAYABLE UNDER

12 1993 ACT.—The claim maintenance fees payable under

13 this section for any period with respect to any claim shall

14 be reduced by the amount of the claim maintenance fees

15 paid under section 10101 of the Omnibus Budget Rec16 onciliation Act of 1993 with respect to that claim and with

17 respect to the same period.

18 (e) WAIVER.—(1) The claim maintenance fee re19 quired under this section may be waived for a claim holder

20 who certifies in writing to the Secretary that on the date

21 the payment was due, the claim holder and all related par22 ties held not more than 10 mining claims on lands open

23 to location. Such certification shall be made on or before

24 the date on which payment is due.
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1 (2) For purposes of paragraph (1), with respect to

2 any claim holder, the term ‘‘related party’’ means each

3 of the following:

4 (A) The spouse and dependent children (as de5 fined in section 152 of the Internal Revenue Code of

6 1986), of the claim holder.

7 (B) Any affiliate of the claim holder.

8 (f) CO-OWNERSHIP.—Upon the failure of any one or

9 more of several co-owners to contribute such co-owner or

10 owners’ portion of the fee under this section, any co-owner

11 who has paid such fee may, after the payment due date,

12 give the delinquent co-owner or owners notice of such fail13 ure in writing (or by publication in the newspaper nearest

14 the claim for at least once a week for at least 90 days).

15 If at the expiration of 90 days after such notice in writing

16 or by publication, any delinquent co-owner fails or refuses

17 to contribute his portion, his interest in the claim shall

18 become the property of the co-owners who have paid the

19 required fee.

20 (g) CREDIT AGAINST ROYALTY.—The amount of the

21 annual claim maintenance fee required to be paid under

22 this section for any claim for any period shall be credited

23 against the amount of royalty required to be paid under

24 section 312 for the same period with respect to that claim.
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1 (h) PURCHASING POWER ADJUSTMENT.—The Sec2 retary shall adjust all dollar amounts established in this

3 section for changes in the purchasing power of the dollar

4 every 10 years following the date of enactment of this sec5 tion, employing the Consumer Price Index for all urban

6 consumers published by the Department of Labor as the

7 basis for adjustment, and rounding according to the ad8 justment process of conditions of the Federal Civil Pen9 alties Inflation Adjustment Act of 1990 (104 Stat. 890).

10 SEC. 315. SAVINGS CLAUSE.

11 Nothing in sections 312, 313, or 314 shall be con12 strued as repealing or modifying any Federal law, regula13 tion, order, or land use plan, in effect prior to the effective

14 date of such section, that prohibits or restricts the applica15 tion of the general mining laws, including such laws that

16 provide for special management criteria for operations

17 under the general mining laws as in effect prior to the

18 effective date of such section, to the extent such laws pro19 vide environmental protection greater than required under

20 the general mining laws.
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1 TITLE IV—AMENDMENTS OF IN2 TERNAL REVENUE CODE OF

3 1986

4 SEC. 401. REPEAL OF EXCLUSION OF CERTAIN

5 EXTRATERRITORIAL INCOME.

6 (a) IN GENERAL.—Section 114 of the Internal Rev7 enue Code of 1986 (relating to extraterritorial income) is

8 amended by adding at the end the following new sub9 section:

10 ‘‘(f) TERMINATION.—This section shall not apply to

11 transactions after December 31, 2001.’’

12 (b) EFFECTIVE DATE.—The amendment made by

13 this section shall apply to transactions after December 31,

14 2001.

15 SEC. 402. DENIAL OF DEDUCTION FOR PAYMENTS OF EX16 CESSIVE COMPENSATION.

17 (a) IN GENERAL.—Section 162 of the Internal Rev18 enue Code of 1986 (relating to deduction for trade or busi19 ness expenses) is amended by inserting after subsection

20 (h) the following new subsection:

21 ‘‘(i) EXCESSIVE COMPENSATION.—

22 ‘‘(1) IN GENERAL.—No deduction shall be al23 lowed under this chapter for any excessive com24 pensation with respect to any full-time employee.
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1 ‘‘(2) EXCESSIVE COMPENSATION.—For pur2 poses of this subsection, the term ‘excessive com3 pensation’ means, with respect to any employee, the

4 amount by which—

5 ‘‘(A) the compensation for services per6 formed by such employee during the taxable

7 year, exceeds

8 ‘‘(B) an amount equal to 25 times the low9 est compensation for services performed by any

10 other full-time employee during such taxable

11 year.

12 ‘‘(3) DEFINITIONS AND SPECIAL RULES.—For

13 purposes of this subsection—

14 ‘‘(A) COMPENSATION.—

15 ‘‘(i) IN GENERAL.—The term ‘com16 pensation’ means salary, wages, and bo17 nuses.

18 ‘‘(ii) PART-YEAR EMPLOYEES.—In the

19 case of any part-year employee, the com20 pensation of the employee shall be com21 puted on an annualized basis.

22 ‘‘(B) EMPLOYER.—All persons treated as a

23 single employer under subsection (a) or (b) of

24 section 52 or subsection (m) or (o) of section

25 414 shall be treated as 1 employer.’’
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1 (b) EFFECTIVE DATE.—The amendment made by

2 this section shall apply to taxable years beginning after

3 the date of the enactment of this Act.

4 SEC. 403. DISALLOWANCE OF DEDUCTIONS FOR ADVER5 TISING AND PROMOTIONAL EXPENSES RE6 LATING TO TOBACCO PRODUCT USE.

7 (a) IN GENERAL.—Part IX of subchapter B of chap8 ter 1 of subtitle A of the Internal Revenue Code of 1986

9 (relating to items not deductible) is amended by adding

10 at the end the following new section:

11 ‘‘SEC. 280I. DISALLOWANCE OF DEDUCTION FOR TOBACCO

12 ADVERTISING AND PROMOTIONAL EX13 PENSES.

14 ‘‘No deduction shall be allowed under this chapter for

15 expenses relating to advertising or promoting cigars, ciga16 rettes, smokeless tobacco, pipe tobacco, or any similar to17 bacco product. For purposes of this section, any term used

18 in this section which is also used in section 5702 shall

19 have the same meaning given such term by section 5702.’’

20 (b) CONFORMING AMENDMENT.—The table of sec21 tions for such part IX is amended by adding after the

22 item relating to section 280H the following new item:

‘‘Sec. 280I. Disallowance of deduction for tobacco advertising

and promotion expenses.’’
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1 (c) EFFECTIVE DATE.—The amendments made by

2 this section shall apply to taxable years ending after De3 cember 31, 2001.

4 SEC. 404. SOURCE OF INCOME FROM CERTAIN SALES OF IN5 VENTORY PROPERTY.

6 (a) GENERAL RULE.—Subsection (b) of section 865

7 of the Internal Revenue Code of 1986 (relating to excep8 tion for inventory property) is amended to read as follows:

9 ‘‘(b) EXCEPTION FOR INVENTORY PROPERTY.—

10 ‘‘(1) IN GENERAL.—Except as otherwise pro11 vided in this subsection, income derived from the

12 sale of inventory property shall be sourced under the

13 rules of sections 861(a)(6), 862(a)(6), and 863 and

14 this section shall not apply.

15 ‘‘(2) TREATMENT OF CERTAIN SALES TO RE16 LATED PERSONS.—

17 ‘‘(A) IN GENERAL.—If any inventory prop18 erty produced (in whole or in part) by the tax19 payer is sold by the taxpayer (directly or indi20 rectly) to a related person—

21 ‘‘(i) the portion determined under

22 subparagraph (B) of the income from such

23 sale shall be sourced in the United States

24 or outside the United States depending on

25 where the production activities occur, and
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1 ‘‘(ii) the remaining portion of such in2 come shall be sourced under the rules of

3 sections 861(a)(6), 862(a)(6), and 863.

4 ‘‘(B) AMOUNT APPORTIONED TO PRODUC5 TION ACTIVITIES.—For purposes of subpara6 graph (A), the portion determined under this

7 subparagraph is so much of the income from

8 the sale as does not exceed the greater of—

9 ‘‘(i) the portion of such income appor10 tioned to production activities under sec11 tion 863(b), or

12 ‘‘(ii) the portion of the combined in13 come of the taxpayer and related person

14 attributable to such property which would

15 have been apportioned to production activi16 ties under section 863(b) if such taxpayer

17 and related person were one taxpayer.

18 ‘‘(C) RELATED PERSON.—For purposes of

19 this paragraph, the term ‘related person’ means

20 any person related (within the meaning of sec21 tion 482) to the taxpayer.

22 ‘‘(3) CERTAIN SALES FOR USE IN UNITED

23 STATES.—If—

24 ‘‘(A) a United States resident sells (di25 rectly or indirectly) inventory property to an-
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1 other United States resident for use, consump2 tion, or disposition in the United States, and

3 ‘‘(B) such sale is not attributable to an of4 fice or other fixed place of business maintained

5 by such United States resident outside the

6 United States,

7 any income of such United States resident (or any

8 related person) from such sale shall be sourced in

9 the United States.’’

10 (b) EFFECTIVE DATE.—The amendment made by

11 subsection (a) shall apply to sales after December 31,

12 2001.

13 TITLE V—MISCELLANEOUS PRO14 VISIONS TO REDUCE WASTE15 FUL AND INEFFICIENT

16 SPENDING

17 SEC. 501. INTERNATIONAL SPACE STATION.

18 The National Aeronautics and Space Administration

19 shall not obligate any further funding for the International

20 Space Station.

21 SEC. 502. OVERSEAS PRIVATE INVESTMENT CORPORATION.

22 (a) PROHIBITION ON NEW CONTRACTS.—The Over23 seas Private Investment Corporation may not, on or after

24 the date of enactment of this Act, issue any contract of
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1 insurance or reinsurance, or any guaranty, or enter into

2 any agreement to provide financing.

3 (b) EXISTING CONTRACTS.—Subsection (a) does not

4 require the termination of any contract or other agreement

5 entered into before the date of enactment of this Act.

6 SEC. 503. PROHIBITION ON PROVISION OF NEW CREDIT BY

7 THE EXPORT-IMPORT BANK OF THE UNITED

8 STATES.

9 Notwithstanding any other provision of law, the Ex10 port-Import Bank of the United States may not, on or

11 after the date of the enactment of this Act, provide any

12 guarantee, insurance, or extension of credit, or participate

13 in any extension of credit, except pursuant to a commit14 ment made by the Export-Import Bank of the United

15 States before such date of enactment.

16 SEC. 504. TRADE AND DEVELOPMENT AGENCY.

17 (a) TERMINATION OF AGENCY.—Effective on the

18 date of enactment of this Act, the Trade and Development

19 Agency is abolished.

20 (b) ADMINISTRATION OF EXISTING OBLIGATIONS.—

21 The Secretary of State shall carry out the functions per22 formed on the day before the date of enactment of this

23 Act by the Trade and Development Agency only for pur24 poses of administering contracts or agreements issued or

25 entered into by the Trade and Development Agency before
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1 the date of enactment of this Act that are effective on

2 such date of enactment. Such functions shall terminate

3 when all such contracts and agreements expire.

4 (c) TERMINATION OF PROVISIONS.—Section 661 of

5 the Foreign Assistance Act of 1961 (22 U.S.C. 2191 and

6 following) is repealed, effective on the date of enactment

7 of this Act, except that such section shall continue in ef8 fect with respect to the functions performed by the Sec9 retary of State under subsection (b).

10 (d) TERMINATION OF AFFAIRS.—The Director of the

11 Office of Management and Budget shall take the nec12 essary steps to terminate the affairs of the Trade and De13 velopment Agency.

14 (e) APPROPRIATIONS.—Funds available to the Trade

15 and Development Agency shall, on the date of enactment

16 of this Act, be transferred to the Secretary of State for

17 use in performing the functions of the Trade and Develop18 ment Agency under subsection (b). Upon the expiration

19 of the contracts and agreements with respect to which the

20 Secretary of State is exercising such functions, any unex21 pended balances of the funds transferred under this sub22 section shall be deposited in the Treasury as miscellaneous

23 receipts.
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1 SEC. 505. TERMINATION OF INTERNATIONAL BROAD2 CASTING AUTHORITIES.

3 (a) TERMINATION OF BROADCASTING TO CUBA.—Ef4 fective October 1, 2001, the Television Broadcasting to

5 Cuba Act (22 U.S.C. 1465aa and following) and the Radio

6 Broadcasting to Cuba Act (22 U.S.C. 1465 and following)

7 are repealed.

8 (b) TERMINATION OF INTERNATIONAL BROAD9 CASTING OPERATIONS.—Effective October 1, 2001, the

10 United States International Broadcasting Act of 1994 (22

11 U.S.C. 6201 and following) is repealed.

12 SEC. 506. JOINT PROCUREMENT OF PHARMACEUTICALS BY

13 THE DEPARTMENT OF DEFENSE AND THE DE14 PARTMENT OF VETERANS AFFAIRS.

15 The Secretary of Defense and the Secretary of Vet16 erans Affairs shall—

17 (1) establish a joint office for the procurement

18 of pharmaceuticals for the Department of Defense

19 and the Department of Veterans Affairs; and

20 (2) jointly develop and implement a common

21 clinically-based formulary for the pharmaceutical

22 programs of the Department of Defense and the De23 partment of Veterans Affairs.

Æ