I
107TH CONGRESS
1ST SESSION
H. R. 3140
To provide tax and other incentives to maintain a vibrant travel and tourism
industry, to keep working people working, and to stimulate economic
growth, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
OCTOBER 16, 2001
Mr. KENNEDY of Rhode Island (for himself and Mr. HASTINGS of Florida)
introduced the following bill; which was referred to the Committee on
Ways and Means, and in addition to the Committees on Energy and
Commerce, Small Business, and Education and the Workforce, for a pe-
riod to be subsequently determined by the Speaker, in each case for con-
sideration of such provisions as fall within the jursidiction of the com-
mittee concerned
A BILL
To provide tax and other incentives to maintain a vibrant
travel and tourism industry, to keep working people
working, and to stimulate economic growth, and for other
purposes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Tourism Revitalization And Valued Employee Labor Act
of 2001’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Personal travel credit.
Sec. 4. Temporary increase in deduction for business meals and entertainment.
Sec. 5. Net operating loss carryback for travel and tourism industry.
Sec. 6. Public-private partnership to stimulate travel to and within the United
States.
Sec. 7. Small business travel and tourism disaster loan program.
Sec. 8. Work opportunity credit.
Sec. 9. COBRA continuation coverage and other health insurance coverage and
unemployment compensation for certain eligible workers.
Sec. 10. National emergency grants under the Workforce Investment Act of
1998.
SEC. 2. FINDINGS.
Congress finds the following:
(1) Prior to September 11, 2001, more than
19,000,000 Americans had been employed in travel
and travel-related jobs, with an estimated annual
payroll of $171,500,000,000.
(2) In recent years, the travel and tourism in-
dustry has grown to be the third largest industry as
measured 
by 
retail 
sales, 
with 
over
$582,000,000,000 in expenditures, generating over
$99,600,000,000 in Federal, State, and local tax
revenues in 2000.
(3) In 2000, the travel and tourism industry
created a $14,000,000,000 balance of trade surplus
for the United States.
(4) The travel and tourism industry and all lev-
els of government are working together to ensure
that, following the horrific terrorist attacks on the
World Trade Center and the Pentagon on Sep-
tember 11, 2001, travel is safe and secure, and that
confidence among travelers is maintained.
(5) Urgent, short-term measures are necessary
to keep working people working and to generate cash
flow to assist the travel and tourism industry in its
ongoing efforts to retain its economic footing.
(6) Increased consumer spending on travel and
tourism is essential to revitalizing the economy.
(7) The American public should be encouraged
to travel for personal, as well as on business, as a
means of keeping working people working and gener-
ating cash flow that can help stimulate a rebound in
the Nation’s economy.
SEC. 3. PERSONAL TRAVEL CREDIT.
(a) IN GENERAL.—Subpart A of part IV of sub-
chapter A of chapter 1 of the Internal Revenue Code of
1986 (relating to nonrefundable personal credits) is
amended by inserting after section 25B the following new
section:
‘‘SEC. 25C. PERSONAL TRAVEL CREDIT.
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an in-
dividual, there shall be allowed as a credit against the tax
imposed by this chapter for the taxable year an amount
equal to the qualified personal travel expenses which are
paid or incurred by the taxpayer for travel occurring after
the date of enactment of this section and before January
1, 2003.
‘‘(b) MAXIMUM CREDIT.—The credit allowed to a
taxpayer under subsection (a) for any taxable year shall
not exceed $500 ($1,000, in the case of a joint return).
‘‘(c) QUALIFIED PERSONAL TRAVEL EXPENSES.—
For purposes of this section—
‘‘(1) IN
GENERAL.—The term ‘qualified per-
sonal travel expenses’ means expenses in connection
with a qualifying personal trip for—
‘‘(A) travel by commercial transportation,
including aircraft, rail, watercraft, or motor ve-
hicle, and
‘‘(B) lodging while away from home at any
commercial lodging facility.
Such term does not include expenses for meals, en-
tertainment, merchandise, or services.
‘‘(2) QUALIFYING PERSONAL TRIP.—
‘‘(A) IN GENERAL.—The term ‘qualifying
personal trip’ means travel within the United
States, a possession of the United States, Mex-
ico, or Canada—
‘‘(i) the farthest destination of which
is at least 100 miles from the taxpayer’s
residence, and
‘‘(ii) involves an overnight stay at a
commercial lodging facility.
‘‘(B) 
ONLY
PERSONAL
TRAVEL
IN-
CLUDED.—With respect to any individual, such
term shall not include travel if, without regard
to this section, any expenses of such individual
in connection with such travel are deductible in
connection with a trade or business or activity
for the production of income.
‘‘(3) COMMERCIAL
LODGING
FACILITY.—The
term ‘commercial lodging facility’ includes any hotel,
lodging motel, resort, rooming house, or camp-
ground.
‘‘(d) SPECIAL RULES.—
‘‘(1) DENIAL OF CREDIT TO DEPENDENTS.—No
credit shall be allowed under this section to any indi-
vidual with respect to whom a deduction under sec-
tion 151 is allowable to another taxpayer for a tax-
able year beginning in the calendar year in which
such individual’s taxable year begins.
‘‘(2) EXPENSES MUST BE SUBSTANTIATED.—
No credit shall be allowed by subsection (a) unless
the taxpayer substantiates by adequate records or by
sufficient evidence corroborating the taxpayer’s own
statement the amount of the expenses described in
subsection (c)(1).
‘‘(e) DENIAL OF DOUBLE BENEFIT.—No credit shall
be allowed under this section for any expense for which
a deduction is allowed under this chapter.’’.
(b) CONFORMING AMENDMENT.—The table of sec-
tions for subpart A of part IV of subchapter A of chapter
1 of the Internal Revenue Code of 1986 is amended by
inserting before the item relating to section 26 the fol-
lowing new item:
‘‘Sec. 25C. Personal travel credit.’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending after the
date of the enactment of this Act.
SEC. 4. TEMPORARY INCREASE IN DEDUCTION FOR BUSI-
NESS MEALS AND ENTERTAINMENT.
(a) IN GENERAL.—Subsection (n) of section 274 of
the Internal Revenue Code of 1986 (relating to only 50
percent of meal and entertainment expenses allowed as de-
duction) is amended by adding at the end the following
new paragraph:
‘‘(4) TEMPORARY INCREASE IN LIMITATION.—
With respect to any expense or item paid or incurred
during the period October 1, 2001, through Decem-
ber 31, 2002, paragraph (1) shall be applied by sub-
stituting ‘100 percent’ for ‘50 percent’.’’.
(b) EFFECTIVE DATE.—The amendment made by
this section shall apply to taxable years ending after the
date of the enactment of this Act.
SEC. 5. NET OPERATING LOSS CARRYBACK FOR TRAVEL
AND TOURISM INDUSTRY.
(a) IN GENERAL.—Paragraph (1) of section 172(b)
of the Internal Revenue Code of 1986 (relating to years
to which loss may be carried) is amended by adding at
the end the following new subparagraph:
‘‘(H) TRAVEL
AND
TOURISM
INDUSTRY
LOSSES.—In the case of a taxpayer which has
a travel or tourism loss (as defined in sub-
section (j)) for a taxable year that includes any
portion of the period beginning on or after Sep-
tember 12, 2001, and ending before January 1,
2003, such travel or tourism loss shall be a net
operating loss carryback to each of the 5 tax-
able years preceding the taxable year of such
loss.’’.
(b) SPECIAL RULES FOR TRAVEL AND TOURISM IN
LOSSES.—Section 172 of the Internal Revenue Code of
1986 (relating to net operating loss deduction) is amended
by redesignating subsection (j) as subsection (k) and by
inserting after subsection (i) the following new subsection:
‘‘(j) RULES RELATING TO TRAVEL AND TOURISM IN-
DUSTRY LOSSES.—For purposes of this section—
‘‘(1) IN GENERAL.—The term ‘travel or tourism
loss’ means the lesser of—
‘‘(A) the amount which would be the net
operating loss for the taxable year if only in-
come and deductions attributable to the travel
or tourism business are taken into account, or
‘‘(B) the amount of the net operating loss
for such taxable year.
‘‘(2) TRAVEL
OR
TOURISM
BUSINESS.—The
term ‘travel or tourism business’ includes the active
conduct of a trade or business directly related to
travel or tourism, including—
‘‘(A) the provision of commercial transpor-
tation (including rentals) or lodging,
‘‘(B) the operation of airports or other
transportation facilities or the provision of serv-
ices or the sale of merchandise within such fa-
cilities,
‘‘(C) the provision of services as a travel
agent,
‘‘(D) the operation of convention, trade
show, or entertainment facilities, and
‘‘(E) the provision of other services as
specified by the Secretary.
‘‘(3) 
COORDINATION
WITH
SUBSECTION
(b)(2).—For purposes of applying subsection (b)(2),
a travel or tourism loss for any taxable year shall be
treated in a manner similar to the manner in which
a specified liability loss is treated.
‘‘(4) ELECTION.—Any taxpayer entitled to a 5-
year carryback under subsection (b)(1)(H) from any
loss year may elect to have the carryback period
with respect to such loss year determined without re-
gard to subsection (b)(1)(H). Such election shall be
made in such manner as may be prescribed by the
Secretary and shall be made by the due date (includ-
ing extensions of time) for filing the taxpayer’s re-
turn for the taxable year of the net operating loss.
Such election, once made for any taxable year, shall
be irrevocable for such taxable year.
‘‘(5) RELATED TAXPAYERS.—Under regulations
prescribed by the Secretary and at the election of a
taxpayer entitled to a 5-year carryback under sub-
section (b)(1)(H) with respect to a travel or tourism
loss, such loss may be credited against the taxable
income earned during the 5-year carryback period by
any member of a controlled group of corporations
(as defined in section 1563(a)) of which the tax-
payer is a component or additional member within
the meaning of section 1563(b).’’.
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to taxable years ending before, on,
or after the date of the enactment of this Act.
SEC. 6. PUBLIC-PRIVATE PARTNERSHIP TO STIMULATE
TRAVEL 
TO 
AND 
WITHIN 
THE 
UNITED
STATES.
(a) PROMOTIONAL EFFORTS TO ENCOURAGE TRAV-
EL.—The Secretary of Commerce is authorized to award
grants and to make direct expenditures in support of a
coordinated, national promotional campaign developed in
consultation with the private sector to encourage individ-
uals to travel to and within the United States.
(b) AUTHORIZATION OF APPROPRIATIONS.—
(1) AUTHORIZATION.—Subject to paragraphs
(3) and (4), there is authorized to be appropriated
$30,000,000 for fiscal year 2002 and $20,000,000
for fiscal year 2003 for the purpose of funding pro-
motional programs to encourage individuals to travel
to and within the United States.
(2) DESIGNATION.—Congress designates the
entire amounts described in paragraph (1) as emer-
gency requirements pursuant to section 252(e) of
the Balanced Budget and Emergency Deficit Control
Act of 1985.
(3) 
CONDITIONS
ON
DISBURSEMENT
OF
FUNDS.—None of the funds authorized to be appro-
priated under paragraph (1) may be disbursed by
the Secretary until he has—
(A) determined that a comparable amount
of funds will be expended collectively by the pri-
vate sector and state and local governments,
whether in the form of cash or in-kind contribu-
tions, in support of such promotional efforts;
and
(B) established appropriate procedures to
maximize the value of the Federal Govern-
ment’s expenditure of funds to promote travel
to and within the United States.
(4) RESTRICTIONS ON USE OF FUNDS.—None
of the funds authorized to be appropriated under
paragraph (1) may be used for purposes other than
radio, television, and print advertising and mar-
keting programs designed to promote travel to and
within the United States.
(5) REPORT TO CONGRESS.—With respect to
funds authorized for expenditure in fiscal years 2002
and 2003, not later than March 30, 2003, and
March 30, 2004, as appropriate, the Secretary shall
submit to the Committee on Energy and Commerce
and the Committee on Transportation and Infra-
structure of the House of Representatives and the
Committee on Commerce, Science, and Transpor-
tation of the Senate a detailed report setting forth—
(A) the manner in which the appropriated
funds were expended; and
(B) total expenditures by the private sector
and state and local governments, in the form of
cash and in-kind contributions, in support of
the programs authorized under this section to
encourage individuals to travel to and within
the United States.
SEC. 7. SMALL BUSINESS TRAVEL AND TOURISM DISASTER
LOAN PROGRAM.
(a) IN GENERAL.—The Administrator of the Small
Business Administration may make loans under section
7(b)(2) of the Small Business Act (15 U.S.C. 636(b)(2))
to travel or tourism small business concerns that suffered
substantial economic injury as a result of the terrorist at-
tacks against the United States that occurred on Sep-
tember 11, 2001.
(b) SPECIAL RULES.—Notwithstanding the require-
ments of subsections (b) and (c) of section 7 of the Small
Business Act (15 U.S.C. 636), the following special rules
apply to loans described in subsection (a):
(1) INTEREST RATE.—The Administrator may
charge interest on any such loan. Such charge may
not exceed a rate of 4 percent per year.
(2) USE OF LOAN PROCEEDS.—In addition to
any purpose for which the proceeds of a loan made
under section 7(b)(2) of the Small Business Act (15
U.S.C. 636(b)(2)) could otherwise be used, the pro-
ceeds of any loan made under subsection (a) may be
used for the following purposes:
(A) Retaining existing employees.
(B) Continuing health care or other bene-
fits for employees laid off by the concern after
September 11, 2001.
(C) Refinancing indebtedness incurred
prior to September 11, 2001.
(3) DISASTER AREA.—No declaration of a dis-
aster area is required.
(c) TERMINATION.—The Administrator may not
make a loan pursuant to the special rules of this section
after December 31, 2002.
(d) TRAVEL OR TOURISM SMALL BUSINESS CON-
CERN.—For the purposes of this section, the term ‘‘travel
or tourism small business concern’’ means a small busi-
ness concern (as defined in section 3(a) of the Small Busi-
ness Act (15 U.S.C. 632(a)) that provides a majority of
the goods and services produced by the concern to busi-
nesses in the travel or tourism industry, or that is itself
in the travel or tourism industry, including any small busi-
ness concern described in sector 72, subsectors 481, 487,
and 713, and code 532111 of the North American Indus-
try Classification System codes (as described in section
121.201 of title 13, Code of Federal Regulations, as in
effect on January 2, 2001).
SEC. 8. WORK OPPORTUNITY CREDIT.
Subparagraph (B) of section 51(c)(4) of the Internal
Revenue Code of 1986 is amended by striking ‘‘2001’’ and
inserting ‘‘2002’’.
SEC. 9. COBRA CONTINUATION COVERAGE AND OTHER
HEALTH INSURANCE COVERAGE AND UNEM-
PLOYMENT COMPENSATION FOR CERTAIN
ELIGIBLE WORKERS.
(a) ELIGIBLE EMPLOYEE DEFINED.—For purposes
of this section:
(1) IN
GENERAL.—The term ‘‘eligible em-
ployee’’ means an individual who has become totally
or partially separated, or is threatened to become to-
tally or partially separated, from employment with a
travel or tourism business (as defined in section
172(j)(2) of the Internal Revenue Code of 1986) as
a consequence of—
(A) reductions in services by a travel or
tourism business or hospitality business (includ-
ing hotels, restaurants, and catering) as a re-
sult of a terrorist action or security measure, as
determined by the Secretary of Labor (in this
section referred to as the ‘‘Secretary’’); or
(B) a closure of such a travel or tourism
or hospitality business in the United States as
a result of a terrorist action or security meas-
ure, as determined by the Secretary.
(2) TOTAL OR PARTIAL SEPARATION.—Deter-
minations as to whether an individual has become
totally or partially separated, or is threatened to be-
come totally or partially separated, from employment
shall be made in accordance with such criteria as the
Secretary shall prescribe, taking into consideration
the provisions of section 247 of the Trade Act of
1974 and the purposes of this section.
(b) COBRA CONTINUATION
COVERAGE
ASSIST-
ANCE.—
(1) IN GENERAL.—In the case of an eligible
employee, subject to subsection (e), the Secretary
shall provide for payment of premiums for COBRA
continuation coverage with respect to such employee
and members of the individual’s family. Such pay-
ment may be made through appropriate direct pay-
ment arrangements with the group health plan or
health insurance issuer involved. The Secretary may
require documentation of election of benefits or
proof of premium payment.
(2) COBRA CONTINUATION
COVERAGE
DE-
FINED.—For purposes of this section, the term
‘‘COBRA continuation coverage’’ means coverage
under a COBRA continuation provision (as defined
in section 2791(d)(4) of the Public Health Service
Act) or under section 8905a of title 5, United States
Code.
(c) OPTIONAL TEMPORARY MEDICAID COVERAGE
FOR UNINSURED ELIGIBLE EMPLOYEES.—
(1) IN GENERAL.—Notwithstanding any other
provision of law, subject to subsection (e), a State
may elect to provide, under its medicaid program
under title XIX of the Social Security Act, medical
assistance in the case of an individual who is eligible
for benefits under this bill, who is not eligible for
COBRA continuation coverage, and who is unin-
sured. For purposes of this subsection, an individual
is considered to be uninsured if the individual is not
covered under a group health plan, health insurance
coverage, or under such program or a program
under title XVIII or XXI of such Act.
(2) LIMITATION
TO
MONTHS
OF
COV-
ERAGE.—Assistance under this subsection shall end
with respect to an individual on the earlier of—
(A) the date the individual is no longer un-
insured; or
(B) 18 months after the date the indi-
vidual is first determined to be eligible for med-
ical assistance under this subsection.
(3) SPECIAL RULES.—In the case of medical as-
sistance provided under this subsection—
(A) the Federal medical assistance percent-
age under section 1905(b) of the Social Secu-
rity Act shall be 100 percent;
(B) a State may elect to disregard any in-
come, asset, or resource limitation imposed
under the State medicaid plan or under title
XIX of such Act;
(C) such medical assistance shall not be
provided for periods before the date the indi-
vidual is determined eligible for such assistance;
(D) a State may elect to make eligible for
such assistance a dependent spouse or children
of an individual eligible for medical assistance
under paragraph (1), if such spouse or children
are uninsured; and
(E) individuals eligible for medical assist-
ance under this subsection shall be deemed to
be described in the list of individuals described
in the matter preceding paragraph (1) of sec-
tion 1905(a) of such Act.
(d) ASSISTANCE
FOR EMPLOYEES NOT ELIGIBLE
FOR UNEMPLOYMENT BENEFITS.—
(1) APPLICABILITY.—This subsection applies
with respect to individuals who—
(A) qualify as eligible employees by virtue
of having become totally separated from em-
ployment in a State, and
(B) would not otherwise be eligible for
compensation under the unemployment com-
pensation law of that State (as determined
under paragraph (5)).
(2) TEMPORARY UNEMPLOYMENT BENEFITS.—
The Secretary may, in accordance with such terms
and conditions as the Secretary shall prescribe based
on the Emergency Unemployment Compensation Act
of 1991 or similar provisions of law, and subject to
subsection (e), enter into an agreement with a State,
whereby—
(A) individuals described in paragraph (1)
who become separated from employment in
such State would be eligible to receive tem-
porary unemployment benefits from such State,
and
(B) reimbursement to such State would be
made under this subsection for—
(i) the full amount of any temporary
unemployment benefits paid out by such
State under such agreement, and
(ii) reasonable costs incurred by such
State in the administration of such agree-
ment.
(3) DURATION AND AMOUNT OF BENEFITS.—
Under such an agreement—
(A) benefits shall be available to an indi-
vidual as long as the individual’s unemployment
continues or until the individual is reemployed
in a suitable position, but for no longer than 26
weeks of unemployment, and
(B) such benefits shall not, for a week of
unemployment, exceed the average weekly ben-
efit received by an individual in the State under
the State unemployment compensation law dur-
ing the most recent 52-week period for which
data are available (as of the time of such indi-
vidual’s application for benefits).
(4) DEFINITIONS.—For purposes of this sub-
section, the terms ‘‘compensation’’, ‘‘State’’, and
‘‘week’’ have the respective meanings given such
terms under section 205 of the Federal-State Ex-
tended Unemployment Compensation Act of 1970
(26 U.S.C. 3304 note).
(5) REGULATIONS.—The Secretary may pre-
scribe any operating instructions or regulations nec-
essary to carry out this subsection.
(e) FUNDING.—There is hereby authorized to be ap-
propriated $1,750,000,000 to carry out this section in fis-
cal years 2002 and 2003.
SEC. 10. NATIONAL EMERGENCY GRANTS UNDER THE
WORKFORCE INVESTMENT ACT OF 1998.
(a) IN GENERAL.—Section 173(a) of the Workforce
Investment Act of 1998 (29 U.S.C. 2918(a)) is
amended—
(1) in paragraph (2), by striking ‘‘and’’ at the
end;
(2) in paragraph (3), by striking the period at
the end and inserting ‘‘; and’’; and
(3) by adding at the end the following:
‘‘(4) to a State or local board that applies for
assistance under subsection (f) to provide employ-
ment and training assistance to travel or tourism in-
dustry workers who are dislocated as a result of the
terrorist attacks against the United States that oc-
curred on September 11, 2001.’’.
(b) REQUIREMENTS.—Section 173 of the Workforce
Investment Act of 1998 (29 U.S.C. 2918) is amended by
adding at the end the following:
‘‘(f) RELIEF FOR TRAVEL OR TOURISM INDUSTRY
WORKERS DISLOCATED AS A RESULT OF THE TERRORIST
ATTACKS OF SEPTEMBER 11, 2001.—
‘‘(1) GRANT
RECIPIENT
ELIGIBILITY.—To be
eligible to receive a grant under subsection (a)(4), a
State or local board shall submit to the Secretary an
application at such time, in such manner, and con-
taining such information as the Secretary may re-
quire.
‘‘(2) PARTICIPANT ELIGIBILITY.—To be eligible
to receive employment and training assistance under
a grant awarded under subsection (a)(4), a worker
shall be an individual who has become totally or par-
tially separated, or is threatened to become totally or
partially separated, from employment with a travel
or tourism business (as defined in section 172(j)(2)
of the Internal Revenue Code of 1986) as a con-
sequence of—
‘‘(A) reductions in services by a travel or
tourism business or hospitality business (includ-
ing hotels, restaurants, and catering) as a re-
sult of the terrorist attacks against the United
States that occurred on September 11, 2001, or
a security measure related to such attacks, as
determined by the Secretary; or
‘‘(B) a closure of such a travel or tourism
or hospitality business in the United States as
a result of such terrorist attacks or security
measure, as determined by the Secretary.
‘‘(3) AUTHORIZATION
OF
APPROPRIATIONS.—
There is authorized to be appropriated $50,000,000
for each of the fiscal years 2002 and 2003 for the
award of grants under subsection (a)(4) in accord-
ance with this subsection.’’.
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