Wayne Allard

Mr. ALLARD

Mr. ALLARD. Madam President, I thank you. In 1994, OPIC's lending authority for its insurance financing was last raised and has been frozen ever since. Since that time, the administration----

Mr. ALLARD. Mr. President, I have no objection to that.

Mr. ALLARD. Mr. President, I would like to have an opportunity to make some summarizing comments and then, if there are not any other statements, I will make a closing statement. I would like to respond by saying it is true that there is some extra revenue that has come into OPIC, but the fact is that that is interest that they have earned, and OPIC itself, in saying how much more income it could generate, said if we could get away from having to buy Treasury bonds and invest in the stock market, we could generate more income. To me, that sends a signal that we would be better off in the private sector. A lot of these businessmen have an opportunity to go to the private sector, go to the stock market to fund these projects overseas. And I am a small businessman, too, by the way. I started my business from scratch, but I think as business people, sometimes it is all too easy to turn to the agencies for help. We need to encourage business people to turn to the market and to focus on what they can do to meet the needs of the market. After all, this is an agency. It is a Government-run agency that is picking winners and losers. I would feel much more comfortable having a competitive market system picking winners and losers. Many States, like the State of Colorado which I am from, have done a lot to promote foreign competition, but they have done it on their own. Most of the jobs and the new growth that has happened in Colorado has not been the result of OPIC. So I think we have to be careful and not give too much credit to this particular Federal agency. Let me end by just stating, again, a few historical facts. In 1971, OPIC's administrative budget was $3.2 million. In 1981, it was $7.5 million. In 1988, it was $12 million. And in 1992, it was $16.4 million. In 1996, their administrative appropriation was $28.1 million, and in 1997, it was $32 million. Also, according to OPIC, in 1988, their FTE's, or full-time equivalent employment ceiling, was 125. In 1992, it was 155, and in 1996, it was 182. As these historical numbers from OPIC point out, this is not some sleeping agency, but one whose administrative costs and employment have increased substantially. If we take the 1996 number of employees and divide it into the 1996 administrative costs, it comes to $154,000 per employee. Now, I realize that not all this goes to employees' salaries, but also to normal office supplies and other office expenses that go to support each one of those FTE positions. But here is the problem. I have yet to hear a compelling argument for continuing increase in the administrative budget when their liability cap is frozen. Also, as I and my staff have searched their records, I have yet to find a clear delineation of where their administration budget goes. All I do know is that in this $32 million, and I quote from the bill, ``any project-specific transaction costs, including direct and indirect costs incurred in claims settlements, and other direct costs associated with service provided to specific investors or potential investors pursuant to section 234 of the Foreign Assistance Act of 1961, shall not,'' again, ``shall not be considered administrative expenses for the purpose of this heading.'' I question what these expenses are and where they go. I cannot find them listed in their reports or from any correspondence. Oversight is a proper function of Congress, and we should pursue it vigorously. While I may have some problems with OPIC, Mr. President, I do want to commend them for being prompt and professional in their manner of dealing with my inquiries, and I take my hat off to them for this. Again, I reiterate, this amendment is not about OPIC and whether they should continue, because we will get to that later. But this is an argument of whether a U.S. Government agency should have a 50-percent increase in administrative expenses since 1994 when their congressionally mandated lending authority has been frozen during that same period. I urge my colleagues to support this amendment and ask for limited growth in all agencies. I ask for the yeas and nays.

Mr. ALLARD

Mr. ALLARD. I can keep my remarks brief and then submit my full comments for the Record. If I can have a couple of minutes, that will be sufficient.

Mr. ALLARD. Mr. President, I thank the chairman of the Budget Committee, Senator Domenici, for his fine work. I would like to recognize the tremendous work that my colleague and fellow Senator from Colorado, Senator Ben Nighthorse Campbell, has done on behalf of native Americans. I rise in opposition to the Feingold amendment. I rise today to offer my support for the Animas-La Plata project. This issue has been very contentious for a very long time. While the proponents of the amendment are well-intentioned, they are also very poorly informed. I can think back, maybe 3 or 4, maybe 6 months ago, when there was some activism within America, saying we ought to apologize to native Americans. If we are really concerned about what happens to native Americans, we ought to first look at keeping our word, keeping those treaties which we have signed. The 1988 Colorado Ute Indian Water Rights Settlement Act recognized the legitimate water rights claims established by treaty, way back to 1868, and again promised the Ute Indian Tribes a permanent, reliable water source to meet their present and future needs. These are rightful water rights that have been affirmed by the Supreme Court and ratified by Congress. The Animas-La Plata project, the foundation for this settlement, would divert a portion of the annual runoff from the Animas River into an off-stream reservoir, rather than damming the river and flooding the river valley. This project fulfills an obligation that we have to the Indian tribes that we should not forsake. This is a treaty obligation. That is what those who favor elimination would like everyone to overlook. The Rocky Mountain News, a major paper in the Rocky Mountain region, in an editorial published last week, made this point very well when they wrote of the opponents to this project: They will do anything, it seems, to achieve their goal of seeing the United States break another agreement with Indian tribes. As the Ute Tribe stated recently, we only ask that Congress, which promised the two tribes adequate water supply when they placed us on a reservation over a century ago and agreed to a full-size Animas-La Plata in 1988, be fair with us now and support a reduced facility and settlement. What opponents of this project don't understand is that in the West, unless we have a facility to store water, we cannot really settle the water claims of the Indians. What happens if we don't fund this project? The tribes will sue, and instead of living up to our agreements, we will see litigation, and I don't think that is where we want to be going. But the issue here is bigger than just another project. The issue here deals with not breaking another treaty with another tribe. I yield time to my colleague from Colorado, Senator Campbell.

Mr. ALLARD. Mr. President, I yield to the Senator from Idaho, Senator Craig.

Mr. ALLARD. How much time do I have?

Mr. ALLARD. Mr. President, I reiterate that it is more than just apologizing to the native Americans in this instance, it is keeping our word, it is keeping our agreement, a treaty with the native Americans. Again, I think we ought to stand by the side of my Senator from Colorado, Senator Ben Nighthorse Campbell, in fighting this amendment, and support him in his efforts in trying to provide a better life for his people and the native Americans in southwestern Colorado. I yield back the remainder of my time. Mr. DOMENICI addressed the Chair.

Mr. ALLARD

Mr. ALLARD. Mr. President, I am here today to offer an amendment that would continue the development and transformation of the Rocky Mountain Arsenal to the Rocky Mountain Arsenal Wildlife Refuge. This has been an ongoing cooperative effort between the Department of the Army, the Environmental Protection Agency, U.S. Fish and Wildlife Service, Shell Oil Co., and local, State, and Federal elected officials. The Rocky Mountain Arsenal contains 17,000 acres northwest of Denver, CO, that was purchased by the Army in 1942 to manufacture chemical weapons. The Army leased the property after World War II to various chemical manufacturers through 1982. Needless to say, this had an incredible environmental impact. However, through all of this environmental abuse wildlife flourished. In fact, in 1986 a winter communal roost of bald eagles was discovered on site, an incredible occurrence considering the circumstances. Because of its protected status, the arsenal became a haven for close to 300 wildlife species including deer, coyotes, owls, and eagles. Efforts were undertaken to preserve the wildlife habitat. These efforts were rewarded in 1992 when Congress passed the Rocky Mountain Arsenal National Wildlife Refuge Act, legislation that I supported as a Member of the other body. Today, cleanup efforts are still underway, but great progress has been made. Groundwater treatment facilities are in place, 350 abandoned wells have been closed, and soil remediation is in progress. This has allowed portions of the arsenal to be opened to the public for wildlife viewing. This amendment allows the public the opportunity for greater access to the refuge. The exact purpose of this amendment is to clarify existing law to facilitate the transfer of property at the Rocky Mountain Arsenal to Commerce City, CO, in a negotiated sale at fair market value. The city will hold this land, develop it in accordance with plans made in connection with the Fish and Wildlife Service and other governmental entities, and ultimately sell some of this land, making proceeds available for the continuing development of the Rocky Mountain Wildlife Refuge visitor center. The Government Services Administration objected to the original language in Public Law 102-402. We have worked with GSA in formulating legislative language that meets the requirements of GSA as well as my intent and the intent of Commerce City. I am always pleased when the Federal Government can work with local governments to provide a public benefit at no cost to the taxpayer. This is one such case. Finally, I would like to thank Chairman Thurmond for his assistance and leadership on this amendment, and appreciate the hard work and diligence of his staff.

Mr. ALLARD

Mr. ALLARD. Mr. President, let me briefly explain what this amendment is all about. This is an amendment in which we address the indexing of capital gains. When we index capital gains, what we are talking about is protecting long-term investors from taxation on inflationary gains. This helps the family business, the family farm, and the family ranch. It is the family and the average American out there who owns a capital asset. Specifically, what the amendment does is--it is pretty much the same indexing provision that was reported out of the House except that it delays the implementation of it to 2002. The holding period of the property would change from 3 to 5 years. Just briefly, there are two other very important points that I would like to make about this particular amendment. It is revenue neutral over 10 years, as scored by the Joint Committee on Taxation; and, No. 2, it is germane, and in fact it does blend within the current language of the bill. I yield back the remainder of my time.

Mr. ALLARD. Mr. President, I ask unanimous consent that further reading of the amendment be dispensed with.

Mr. ALLARD. I have at the desk amendment No. 577. I ask that the clerk call it up.

Mr. ALLARD

Mr. ALLARD. Mr. President, I say to the majority leader, I did not hear my name listed on that list of amendments, it is the Allard- 4Abraham-Brownback amendment.

Mr. ALLARD. It's under my name actually, Allard-Brownback; Senator Abraham is a cosponsor.

Mr. ALLARD

Mr. ALLARD. Mr President, Kristy Danielle Vaughn, daughter of Gary and Kelli Vaughn, of Joes, Co, was a promising young student about to report for duty this month at the United States Military Academy at West Point. She had been nominated for an appointment there by former U.S. Senator Hank Brown and myself when I served in the U.S. House of Representatives. She was a leader in her high school government, 4-H Club, sports, and school organizations, and received numerous awards in all areas. With all these responsibilities, she also gave much of her time to the duties of her family's farm. This bright young woman was suddenly killed in an auto accident recently as she was on her way to the All State Basketball finals in Greeley, CO. Kristy very actively contributed her time and talents to her school and her community. She will be greatly missed in Joes, and her opportunities and contributions at West Point will never be realized.

Mr. ALLARD

Mr. ALLARD. OK. I appreciate the chairman, Mr. President, giving me an opportunity just to speak a minute or two about this amendment. Mr. President, I would like to take this time to discuss this amendment that would give families with uninsured children the opportunity to obtain proper health coverage. My amendment would allow families with uninsured children to deposit money in a medical savings account to use for health care services. I believe it is critical to provide lower income families with the option to establish medical savings accounts. MSA's allow consumers to pay for medical expenses through affordable tax-deductible plans that are most suited to their needs. Americans want choice in health care. It is time for the Federal Government to listen to the American people and make medical savings accounts an available option. Medical savings accounts are a viable free-market approach to ensuring greater access to affordable health care coverage for the uninsured. I believe our efforts need to be focused on providing uninsured children with accessible health care services. My amendment would give these families the opportunity of setting aside MSA funds, especially benefiting those who are self-employed, between jobs, or employed where health coverage is not available. I am hopeful that in the 105th Congress, we will be able to expand the availability of medical savings accounts. My amendment is one step to achieving the goal of decreasing the number of uninsured children by providing families with the option to receive much needed health care coverage. By making more MSA's available, we can make it easier for parents to finance their children's health care; afterall, the health of our Nation's children is at stake. I understand the position of the chairman having to raise this point of order. I just hope that the Finance Committee takes a closer look at medical savings accounts and the problem we have with uninsured children. With that, I will go ahead and withdraw my amendment.

Mr. ALLARD. Is the chairman going to make a point of order on my amendment?

Mr. ALLARD

Mr. ALLARD. Mr. President, first of all, are we in a quorum call?

Mr. ALLARD. Mr. President, I ask the Senator from Delaware for permission to go ahead and make some comments, a general floor statement, and then I would like to introduce an amendment.

Mr. ALLARD. I thank the Senator. I would like to, Mr. President, compliment the chairman for his hard work on this particular piece of legislation. Mr. President, this week I am confident that the Senate will approve the largest tax cut since the Reagan tax cuts of 1981. And it is about time. In the 16 years since the last tax cut, Congress has enacted two major tax increases--one in 1990, and the other in 1993. Mr. President, it is time for a change. It is time to put American families ahead of Washington, DC's insatiable appetite for more Government spending. Taxes are now higher than they have ever been. Taxes constitute one- third of the economy. And Tax Freedom Day--the day to which the average American works to pay the combined Federal, State, and local tax burden--and that date is May 9. It is the latest it has ever been. Mr. President, I view this tax cut as a downpayment. My long-term objective is to ensure that no American family pays more than 25 percent of its income in taxes. A balanced Federal budget, and a reasonable level of taxation should be the twin objectives of Congress as we enter the next century. I invite all of my colleagues to support this tax cut and to help ensure that the bridge to the 21st century does not become a giant toll bridge. Today I would like to focus on what I call the growth tax. This is typically referred to as the capital gains tax, a term which liberals often use derisively to help create the impression that only the rich pay the growth tax. In fact, as you may know, Mr. President, nearly all Americans own capital, and they experience a tax on that capital when they sell a house or when they sell stocks or a small business or a farm or a ranch. Under our current Tax Code, gains on capital investment are taxed at a 28-percent Federal rate, and often an additional 5 percent or more in State taxes comes in on top of that. This is the growth tax, and this is among the highest growth tax of any major industrial nation. The real growth tax is often much higher than 28 percent. This is because our Tax Code does not protect Americans from taxation on capital gains that result only from inflation. This means, for example, that an investment held for 10 years where up to one-third of the gain can be due to inflation, taxes are due even on this. This is clearly one of the most unfair aspects of this tax. Government policies contribute to inflation, and Government then turns around and taxes its citizens on that inflation. For this reason, Mr. President, I intend to fight very hard to see that indexing is included in our growth tax cut. The House bill wisely includes this provision--and I commend Chairman Bill Archer for this. The Senate bill, unfortunately, does not yet have indexing. Hopefully, by the end of the week, it will. Some have dismissed indexing as too costly for this tax bill. But for me this is an issue of fundamental fairness. It is wrong for the Federal Government to tax its citizens on inflation. It is not too costly not to include indexing. Indexing simply means that Americans would be permitted to disregard any gains due solely to inflation, and then pay taxes only on real gains. Mr. President, let's take a look at how this capital gains growth tax hits ordinary working Americans beginning with their home. The Tax Code generally allows gains on a personal residence to be deferred as long as the proceeds are used to purchase another larger home. However, many Americans eventually pay capital gains on their home, particularly as they get older and find that their residence has appreciated substantially in value. Our tax bill deals with this issue by exempting all but the very rich from any taxation on gains from their principal residence. This is a long overdue reform. Next, let's look at financial investments. Stocks are a frequent source of capital gains taxes, and stock ownership today is more widespread than ever before. Stock ownership has doubled in the last 7 years to the point where 43 percent of all adult Americans own stocks. Obviously, with those numbers, Mr. President, it is spread throughout society. Today, half of the investors are women and half are noncollege graduates. Stocks are typically held for retirement, education expenses, and other long-term goals. This is precisely the type of savings and investment that we need in our economy. Investments foster business expansion, and job creation. Capital is the lifeblood of a free market economy. Clearly you cannot have capitalism without capital. And our Tax Code should encourage capital investment. Mr. President, I cannot leave this topic without talking about small business owners and farmers. There is no clearer area where the growth tax makes no sense. Millions of American families put their lives into building small businesses and farms. Often those businesses or farms are sold to finance a decent retirement. But this can occur only after Uncle Sam gets his cut of 28 percent of all the gains. Often, over half of these gains are due only to inflation. It is no wonder that millions of our most ambitious citizens have lost faith in our tax system. Fortunately, Mr. President, tax relief is on the way. This bill lowers the growth tax from 28 to 20 percent for most families, and those in the lowest tax bracket would pay only 10 percent. This tax cut would help make life easier for millions of Americans, and it will help our economy to grow and create new jobs. To those Americans who own a home, who save for retirement or who own a small business or farm, I say that next time a liberal says that capital gains are only for the rich, remember, he is thinking of you. Amendment No. 523 [Purpose: To strike the extension of the Temporary Federal Unemployment Surtax]

Mr. ALLARD. Mr. President, I now would like to send an amendment to the desk and ask for its immediate consideration.

Mr. ALLARD. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. ALLARD. This amendment would strike section 881 of the tax bill. This section extends the so-called temporary unemployment surtax on small business and other employers through the year 2007. The House tax bill does not include this provision. The Senate bill, unfortunately, does. I rise to support the House position on this matter. The description of this provision put out by the committee notes that in 1976 Congress passed a temporary surtax of .2 percent of taxable wages to be added to the unemployment tax rate. I would suggest that at a minimum, if we are going to keep extending this tax, we ought to be honest with the American worker and small business owners and stop calling this a temporary tax. Enough is enough. Between 1970 and 1990, there have been three unemployment tax rate increases and three wage base increases. These have resulted in a dramatic increase in the unemployment tax burden. There is no reason to continue this temporary surtax when we have the lowest unemployment in a quarter century and a full trust fund. This is no more than an additional and unfair general revenue raising. The reason for the unemployment surtax no longer exists. The temporary surtax was put in place in 1976 in order to repay borrowing of the Federal unemployment trust fund from the general fund of the Treasury. Even though the borrowings were repaid in May 1987, Congress has continued to extend the surtax in tax bill after tax bill. As of today, all the States' reservoirs now have surpluses. Since 1987, the surtax has been used solely to raise revenue to pay for tax packages. The tax takes money out of the private economy for no valid reason. I have two concerns with this surtax. First, the Federal Government is breaking its commitment to employers and to workers that this added tax would be temporary. Clearly, it is not temporary, and if this provision remains in the bill and is enacted, the tax will have been in place for 30 years. This is not the way Government should do business. The second problem I have is that we should not be imposing unnecessary payroll taxes. Payroll taxes cost jobs. Because small businesses are generally labor intensive, payroll taxes, which are a tax on labor, strike small businesses particularly hard. Payroll taxes are paid whether there is a profit or a loss. I would note that high payroll taxes in Europe, particularly in Germany, is one of the principal reasons that unemployment is so high. This should be a warning to us to work steadily to limit the payroll tax on U.S. businesses. Mr. President, I understand that there is some concern about my amendment, so I will withdraw this amendment and urge the Senate to agree to the House position on this issue. There are a number of Senators, and I can assure you there are many thousands of small businesses, that would like to see this provision out of the bill, but before I withdraw my amendment, I would like to make an inquiry to the distinguished chairman of the Finance Committee, Senator Roth. In light of the fact that this tax was to be a temporary tax, would the chairman consider either removing the provision in conference or modifying it to at least terminate the tax more quickly than proposed in the bill?

Mr. ALLARD. I thank the chairman for his sincerity and real concern about the surtax, and I would just, in conclusion, reflect on some of my own experiences with the surtax. When it was first applied in 1976, I was just basically starting out in my small business. I had just been in business 4 or 5 years. I had not been in business long enough to have to pay any unemployment compensation, never had to have any turnover in my business, but every dime counted in that new business. And when that surtax was imposed on that small business that I was starting at the time, it did have an impact. I do not believe we can continue to disregard the impact that these unemployment taxes have on small businesses, particularly the small businesses that are just starting out. We need to encourage people to go in business for themselves. We need to encourage people to someday think in terms of being their own boss and being self-sufficient. These types of tax provisions do have a disproportionate impact on small businesses, particularly those just starting out. With that, I yield back the remainder of my time. I thank the Senator.

Mr. ALLARD

Mr. ALLARD. Mr. President, I would like to take this time to discuss an amendment that would give families with uninsured children the opportunity to obtain proper health coverage. Congress is constantly searching for ways to provide children with adequate health care, and I have proposed an amendment that would allow children the means to be covered. My amendment would give the working poor health expense accounts to use for their families. It is reported that there are 10 million children who are uninsured in the United States. Many of these children are uninsured because their parents have incomes that are high enough to be ineligible for Medicaid or do not have private or employer-sponsored health insurance. My amendment would allow families to deposit money in a medical savings account to use for health care services. I believe it is critical to provide lower income families with the option to establish medical savings accounts. MSA's allow consumers to pay for medical expenses through affordable tax-deductible plans that are most suited to their needs. Americans want choice in health care. It is time for the Federal Government to listen to the American people and make medical savings accounts an available option. Medical savings accounts are a viable free-market approach to ensuring greater access to affordable health care coverage for the uninsured. Through MSA's, individuals would be given the choice and opportunity to obtain affordable health services. I believe our efforts need to be focused on providing uninsured children with accessible health care services. My amendment would give these families the opportunity of setting aside MSA funds, especially benefiting those who are self-employed, between jobs, or employed where health coverage is not available. I am hopeful that in the 105th Congress, we will be able to expand the availability of medical savings accounts. Medical savings plans allow individuals the freedom to shop for competitive health care services, which in turn, can help keep the costs of health care down. My amendment is one step to achieving the goal of decreasing the number of uninsured children by providing families with the option to receive much needed health care coverage. By making more MSA's available, we can make it easier for parents to finance their children's health care; after all, the health of our Nation's children is at stake. amendment no. 466 (Purpose: To extend the authority of the Nuclear Regulatory Commission to collect fees through 2002) At the end of the bill, add the following: