Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I would like to take a minute to honor the contributions of Montanans serving overseas. There are thousands of Montanans in harm's way. Today I would like to mention a few. Army SGT Charles Horgan is a soldier with the Army's 1st Battalion, 30th Infantry Scout Platoon of Fort Benning, GA. Many of you undoubtedly heard the stories of battle outside of the Iraqi city of An Nasiriyah. Sergeant Horgan was a Humvee gunner in the lead scout unit. His vehicle encountered a group of Iraqis in Bedouin robes running the other direction. A wire-guided missile struck the bridge, blowing him from his gunning position. Shrapnel from the rocket tore open his leg and foot and wounded the driver, SSG. Jamie Villafane. For the next 10 minutes, their unit was engulfed in a shootout with enemy troops. Charles Horgan, part of his right heel blown off, crawled to safety. Horgan is currently recovering at Walter Reed. It is not known if Horgan will ever walk again unaided. He is 21 years old from Helena, MT, and a graduate of Helena High--my alma mater. He is an aspiring artist who loves drawing. I wish him the best as he recovers, and I take my hat off to him. I talked to him on the phone the night before last. I have talked to his parents a couple of times. He will be on his way home to Montana very shortly. He is a terrific young man. Navy E3 Phillip Lance Stewart, 20, a 2001 graduate of Great Falls High in Great Falls, MT, is a firefighter aboard the USS Abraham Lincoln in the Persian Gulf. Lance, the son of Chuck and Gail Stewart and grandson of Delphine Murphy, all of Great Falls, told his family in a short phone call recently that the letters and boxes from family and friends is what keeps all of them going. He also really misses his brothers and sister--and that is a lot to miss because Lance has six brothers and sisters, including a twin brother. Lance's family has decorated his house with big yellow ribbons and can hardly wait until Lance is home again, safe and sound. Army PFC Sedar Steinert, 19 a former North Middle School and Skyline Alternative School student from Great Falls, MT, was deployed to Iraq with the 2nd Armored Cavalry Regiment, with headquarters at Fort Polk, LA. Sedar's unit is providing artillery and scout support on the road to Baghdad. We all hope for his safe return. SP Ryan Richard Carpenter was born in Dillon, MT. His family currently resides in Belgrade and Dillon, MT. His parents are Richard and Julie Carpenter. Specialist Carpenter joined the Army Reserve in 1997 and met his wife in 2001. His wife is also in the Army Reserve, the couple met while serving an Army Reserve drill weekend that was focused on night vision goggle training. During the drill weekend the couple's squad's call name for the training exercise was Ammo 3. That is what they called it: Ammo 3. From that chance encounter, the couple soon realized that they signed up for the Army Reserve in the same month of the same year, but met by chance roughly 4 years later. The couple was married later that year Specialist Carpenter was called up to active on February 7, 2003, and is serving with the 811th Ammunition Ordnance Company, based out of West Virginia. The unit has been stationed at Camp New York since arriving in Kuwait and will soon be going into Iraq to provide ammunition support for the 101st Airborne. Specialist Carpenter was able to contact his wife from Kuwait and let her know that he had arrived safely and was in good health. During the conversation, Specialist Carpenter explained to his wife that he was assigned night vision goggles for use while driving his HumVee, and every time he picks them up, he thinks of the weekend he met her, both doing such training. Hearing this, his wife smiled and tenderly cried over the telephone, ``Ammo 3!'' The couple then reminisced about the weekend they met and then came to a joint resolution: It was the United States Army that brought them together, and it was the only entity that could temporarily separate them. Specialist Carpenter is deeply loved and missed by his wife, family and friends, and they pray for his safe and expedient return. PFC Jeremiah Coyne of Dillon, MT, went to boot camp during the summer between his junior and senior year of high school. He entered the National Guard after graduation. Not content simply to serve as a guardsman, he went to Active Duty and is now serving proudly in the gulf region. We pray for his safety. PFC Adam Eversole recently celebrated his 22nd birthday in Kuwait, where he was deployed on March 15 as an ambulance nurse. After losing his mother, this caring, religious young man enlisted, following in the footsteps of his father who served and was wounded in Vietnam. After receiving the news that he was headed for Kuwait, he wrote his Grandmother, ``Let's remember, I have Jesus with me always, and He will look over me and keep me safe. When I get back, I hope to come and see you and visit Montana.'' It will be a grateful Montana that greets him. Marine CPL Patrick O'Connell is serving in the Unit Fox 25, attached to the Second Tank Battalion in Iraq. He is a committed public servant who has already been of great service to our State, both as a community lifeguard and as a wildland firefighter. He courageously helped battle the devastating wildfires of 2000. Now he has extended that generosity of character to serve our entire Nation, and he deserves the gratitude of us all. Brock Patera of the Army's 40th transportation company will undergo review on April 15 to become a Sergeant in the U.S. Army. He is busy earning that rank in the desert. He spends long, difficult, dangerous hours behind the wheel of a Humvee. His platoon has been sleeping on the ground and unable to receive mail, but like so many countless others around him, he remains committed to the task at hand. We wish him luck in his coming review and a safe return to his wife Cassandra and his 15-month-old son Devin, who miss him dearly. John Falconer of the 7th Marines Motor T surprised his parents on the morning of April 1 with a phone call from the front lines. The phone call was made on a cell phone borrowed from CNN correspondent Martin Savage. Savage is imbedded with John's unit. John had repaired the fuel pump on Savage's Humvee, and the phone call was offered in thanks. This was the first time his parents had heard the sound of their son's voice in almost a month. When asked what he needed the most, John told his mother, ``a mattress.'' He told his mother that because he slept on the ground, the dirt was so embedded in his pores it would never come out. In the face of hardship, John has remained strong and committed to the task before him. He is in our prayers, and we all hope for his safe return. Mr. President, this is not a complete list of folks from Montana serving our Nation. There are many, many more. I do not plan to return to the Senate floor every day to give stories, but I do plan to return frequently with more stories. I believe that the job our troops are doing is a dangerous one and that they are upholding the freedom we, as a nation, hold so dear. We honor them and wish then continued success and a safe return.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, so often Members of Congress, the President of the United States, and members of the press refer to an event as ``historic.'' The vote we are about to take on the budget resolution is one of those events. If this resolution passes, then April 11, 2003 will be included in the history books as the day the Senate relinquished part of its Constitutional purpose and power. On March 31, a little over a week ago, I attended the funeral service of the late Senator Daniel Patrick Moynihan. I had the privilege of serving in the Senate with Senator Moynihan. He was a visionary, a leader, a teacher, and a statesman. Senator Moynihan reminded us to pay attention to our history. And he protected the historical purpose of the institutions of our nation's government the executive branch, the judicial branch, and especially the legislative branch. Article 1, Section 3 of the Constitution designates the Senate as our Nation's deliberative body. As such, Senators are the only elected officials in our Federal Government with the power to impeach, approve treaties, and have 6 year terms. In Federalist paper No. 63, the Founders explained that 6 year terms were important because the Senate would serve ``as the cool and deliberate sense of the community.'' The Framers believed this was important to prevent the Federal Government from making hasty decisions about matters that are central to the future of our country. Let me quote directly from Federalist 63: . . . so there are particular moments in public affairs when the people, stimulated by some irregular passion, or some illicit advantage, or misled by the artful misrepresentations of interested men, may call for measures which they themselves will afterwards be the most ready to lament and condemn. In short, our Founding Fathers saw the Senate's obligation to deliberate the important issues of our time: Until reason, justice, and truth can regain their authority over the public mind. I believe we are at such a critical juncture. Several Senate rules facilitate the Founders intent. First, Senators generally are allowed to offer amendments to any bill brought before the Senate. This is not generally the case in the House of Representatives. In order to limit debate and reduce amendments, either all 100 Senators must agree to the limitations or the promoters of the legislation must file a motion to close debate and get 60 votes for that motion. That means that a simple majority is simply not good enough. The magnitude of our decisions requires a larger number of the Members of this body--60--to agree that it is the right thing to do for our country. These Constitutional protections are fundamental to ensuring that the Senate maintains the role envisioned by our Founding Fathers. We must be very cautious when diminishing these protections in any way. The enactment of the Budget Act of 1974 is one of the very few instances when the Senate has cut back on these protections. This was done with another important goal in mind--reducing deficits. Let me take a minute to touch on the budget and budget reconciliation protection process. When Congress passed the Congressional Budget and Impoundment Control Act of 1974, the purpose of the legislation was to help Congress control its budget. Among other things, the Budget Act allows Congress to enact a budget blueprint each year. That blueprint, contained in what we call a budget resolution, is considered under special rules and must be passed by April 15th of each year. One of these rules is that, instead of requiring 60 votes for approval, the resolution requires only 51. After a limited amount of time for debate, the Senate moves to a final vote. The Budget Act set up a streamlined process--reconciliation--to make it easier for the Senate to pass legislation pursuant to the directives of the budget resolution. Those provisions such as cutting spending or increasing taxes, are critical to reducing deficits. Thus we agreed to significantly diminish the right of Senators to debate and amend measures brought to the Senate floor when done as part of the budget resolution and reconciliation. We agreed to give up these rights for a very important goal--that of deficit reduction. Things changed, though, in 1996. In 1996, the Senate parliamentarian ruled that the budget resolution's streamlined reconciliation protection could also be used to pass tax cuts, that is, provisions that increase deficits. The budget resolution can now include instructions to the Finance Committee to report tax cuts that can be passed in subsequent legislation with only 51 votes in the Senate. That ruling turned the Budget Act on its head. Unfortunately, today's parliamentary maneuver goes even further; it turns Senate procedure on its head. The instructions in this budget resolution regarding the tax cut establish new precedents that will expand the power of the House and the leadership of the Senate at the expense of Senators. The precedents will diminish the power of any individual Senator, the Senate's committees, and whichever party happens to be in the minority at any given time. This new budget resolution scheme runs counter to intention and rules governing Congress since Congress first convened in 1789. The tax cut instructions direct the Finance Committee to pass a bill with a maximum of $550 billion in tax cuts. However, if the Finance Committee passes a bill greater than $350 billion, then the bill will not be permitted to pass the Senate unless it garners 60 votes of support instead of 51. This is accomplished through a new point of order that will apply during Senate consideration of the Finance Committee bill. So, for example, if the Finance Committee passes a tax cut bill costing $450 billion, any Senator could raise a point of order on the Senate floor. The point would be sustained by the chair, unless 60 Senators voted to waive the point of order. The point of order, however, is not applicable in conference under this resolution. Accordingly, a conference report that comes back above $350 but no more than $550 would need only 51 votes. No known points of order would lie against it--a dramatic change from current Senate practice. At this point, I might say the architect of all these provisions which were designed to maintain Senate procedure and to maintain control of the deficit in a meaningful way is now seated on the floor, Senator Robert Byrd from West Virginia. I pay great respect to the Senator from West Virginia, who I am sure right now is lamenting a lot of new procedures that this body is about to adopt. Under the Byrd Rule, the Senate could not exceed the instructions to the Finance Committee unless there were 60 votes to waive the objection. But there is a significant difference. The Byrd Rule applies to both Senate consideration of the tax bill and Senate consideration of the conference report. But there is a big twist. The new point of order will apply only to Senate floor consideration of the Finance Committee tax cut legislation. It won't touch the conference report. Now, you may ask, why doesn't the Byrd Rule still apply to the conference report? I believe that the Chair would rule that it does apply. This was confirmed in a letter sent from the Parliamentarian to Senator Daschle on April 9, 2003, which stated in part: During Senate consideration, the conference report on this measure [the tax cut bill] would be subject to the level of the reconciliation instruction given to the Finance Committee. If that conference report exceeded the instruction to the Finance Committee, the Byrd Rule would be available to remove provisions from that report sufficient to bring the measure into compliance with the reconciliation instruction to the Finance Committee. I ask unanimous consent that the entire letter be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Madam President, I believe the Senator from Connecticut would like the floor. I yield to him such time as he wishes to consume.

Mr. BAUCUS. Madam President, I think it is important at the outset to know we are including in the CARE bill incentives to help provide charitable contributions for good voluntary purposes, and I think this bill should continue to honor that thrust. The amendment before us does not. The amendment before us essentially is a capital gains tax amendment and applies generally to all property that would be sold. I think this is not the place for that kind of amendment. The underlying provisions of the bill provide that taxpayers who voluntarily sell land to a qualified conservation organization can exclude 25 percent of the gain on that sale from capital gains tax. The purpose, obviously, is to help people, most of whom are land rich and cash poor and do not have much income from their ranching or farm operations--to help by transferring the property to a conservation organization. There are many organizations in this country--a lot in my State of Montana--such as the Nature Conservancy, lots of very good, solid organizations which take land and save it for conservation purposes. This is very important because our country is losing a lot of land to development each day, each year. In fact, in the United States about 2 acres of farmland per minute, or about 1 million per year, are lost to development; that is, shopping centers and new homes or what-not that are just taking away some of the natural land that we have in our country and converting it at a very rapid rate to shopping centers and developments. That is part of America. We need to build shopping centers. We need to also build new homes, housing tracts, and so forth. But we also need to remember there are other values in our country, and those are protecting open space and protecting farms and ranches. A lot of our farms and ranches are under great stress. I know the Presiding Officer knows that is true in her home State as is the case in every State. We are trying to figure out a balanced way to help those farmers and ranchers donate a portion of their land to a conservation organization. They cannot do that today because they have no income. Because they have no income, they can't take the usual charitable deduction. To help them, we are saying you don't have to worry about the charitable deduction; you can still get a little bit of benefit because we will exclude 25 percent of the gain. It is extremely important. I might point out, this is actually a little less generous than provisions suggested by the President. The President, in his budget, suggested an appreciably larger exclusion for this very purpose. The amendment before us, though, is not geared at all toward conservation. Essentially, it provides the same benefit, a 25-percent exclusion that would be available to anyone who sells property for any purpose. It does not have to be conservation. It would be pretty expensive, I might add, too--about a $1.4 billion additional cost to the Treasury. I understand the concerns the Senator has, but this is just not the time or place for capital gains tax reform. This is, rather, a CARE bill, a bill that is encouraging conservation, encouraging charitable giving. I urge my colleagues to not accept the amendment because I do not think it is properly placed in this bill. I reserve my time.

Mr. BAUCUS. Madam President, the CARE Act is an important piece of legislation that will help those organizations that are always there to help us. On balance, I believe the bill will encourage more charitable giving. And this is particularly important now, when demand on these organizations is out-pacing resources. This legislation would not have been possible without the contributions of many. First, I would like to thank the Finance Committee staff for their expert counsel and hard work. They spent many long hours perfecting this legislation. They are role models for those in public service. I appreciate the cooperation we received from the Republican staff members including Kolan Davis, Mark Prater, Dean Zerbe, Elizabeth Paris, Christy Mistr, and Ed McClellan. I want to especially thank my staff, including Jeff Forbes, John Angell, Russ Sullivan, Patrick Heck, and Jonathan Selib. I also want to mention our hardworking interns, Shawn White and Tyler Garrett. The Finance Committee staff worked closely with staff members from other Senate offices. They also were in touch with officials from the Administration, including Susan Brown and others from Treasury. The Joint Committee on Taxation provided technical assistance. Lindy Paull, Mary Schmitt, Roger Colinvaux, Ron Schultz, Sam Olchyk, Ray Beeman, and Brian Meighan. And many others. We owe many thanks for the assistance they provided. Second, I want to thank Senators Lieberman and Santorum. The CARE Act has been a priority for them for a long time. They have worked tirelessly to get this bill before the Senate. We are grateful for their diligence, cooperation and input. I also want to thank our leaders Senators Frist and Daschle for their decision in moving the CARE Act forward. I want to thank my good friend and colleague, Chairman Grassley. As always, he has been instrumental in ensuring a truly bipartisan bill. And, it continues to be a pleasure to work with him. Finally, I look forward to seeing this bill passed into law--and soon. It is my hope that the House will take up this legislation quickly. The CARE Act is one of the President's top priorities. There is a lot in this bill that enjoys widespread, bipartisan support. Together, we have been working on this bill for more than 2 years. There is no need for further delay. I urge the House to act quickly on this legislation so that we can have the CARE Act on the President's desk by the Memorial Day recess. This is a good bill. I urge my colleagues to vote for the CARE Act. Madam President, the CARE Act takes bold steps to combat the devastating problem of hunger--an issue that affects far too many of my constituents in Montana. Today, in the greatest and most prosperous nation in the world, hunger remains a real problem for our families. According to the USDA, more than 1 in 8 households were food insecure in Montana between 1999 and 2001. This means that they do not consistently know where their next meal will come from. And 4 percent of households in Montana--that is 32,000 people, 12,000 of whom are children--live in conditions so severe that they are classified as actually experiencing hunger. These numbers are on the rise--Montana's hunger rate had the second highest jump of any state from an identical USDA study done just three years earlier. Many of these are working poor families, making gut-wrenching decisions between whether to spend their hard-earned money on housing, healthcare, child-care, or food. So this is an issue that concerns me deeply. The CARE Act will provide a valuable weapon in the war to end hunger. It will do so by making it easier for farmers and small businesses to donate surplus food to our struggling hunger relief charities. Simply put, these difficult economic times mean that more people are showing up to food pantries and soup kitchens at a time when these organizations are struggling the most to meet demand. These community groups--usually consisting solely of volunteers--are often ``first-responders'' in the battle against hunger. The CARE Act will help food pantries and soup kitchens to keep food on the shelves for hungry families. The CARE Act is also good for America's struggling farmers and businesses. It helps them do the right thing by donating surplus food that would otherwise have been thrown away. Here is what Peggy Grimes, of the Montana Food Bank Network has to say about the CARE Act: It has come to my attention that these struggling farmers and small grocers do not receive any tax benefit for their increasing donations. They have been donating out of concern for their neighbors as they have been hearing reports of increased food insecurity throughout Montana. . . . For Montana, as an agricultural state, the Care Act will be of significant benefit to both those donating food and those in need of food. Hunger in America is not a problem of lack of food. The USDA estimates that 96 billion pounds of food are thrown away each year. This is simply shameful when working families are struggling to make ends meet. There is a problem when it is more profitable to throw away food than it is to donate it to those who need it. The CARE Act helps solve this problem by providing incentives to farmers and small businesses, whose resources are also constrained in these economic times. America's Second Harvest, the nation's largest anti-hunger charity, estimates that the CARE Act will result in enough donated food to provide roughly 765 million meals over the next 10 years. These results are real, and I am proud to support this provision. The CARE Act is a win-win-win situation. It is a win for anti-hunger charities that work hard to ensure that America's families have food on the table. It is a win for our farmers and businesses that want to help their neighbors in need. And most importantly, it is a win for America's low- income families, who will see food on their tables. I urge my colleagues to support the CARE Act. Madam President, it is a sad fact that in a large number of homes-- particularly in the homes of our poorest, most at-risk children--you cannot find a book. Sixty percent of kindergartners--in neighborhoods that performed poorly in school--did not own a single book. The lack of access to books poses the greatest barrier to literacy. That is why we must change the status quo. Unfortunately, the tax law functions as a disincentive to the charitable donation of books to schools, libraries, and literacy programs. Under the tax law, it is actually more economical to truck books to a dump than it is to give them to your local school or library. Through the title I program, however, we have nearly 15 million youngsters nationwide enrolled. This allows us to reach at least a portion of the disadvantaged children in our country. In my State of Montana, there are an estimated 35,000 poor children who qualify for the title I program. These children will also benefit from the provision in the CARE Act which encourages the donation of books. For a child who has never owned a book--their first book is a prized possession. An increase in charitable book contributions would especially benefit the State of Montana. According to the Montana Library Association, the Montana State Library has fallen victim to a 26 percent budget cut in 2003. These reductions will mean less money for local libraries. And they will mean cuts in the State subsidies that currently fund book purchases, interlibrary loans, and audio and other special books for the elderly, disabled, and sick. According to the Montana Commissioner of Higher Education, Montana universities will also receive fewer books. In the wake of the latest budget cuts, the state legislature has cut university budgets 8.4 percent. That puts university funding below 1992 levels. The University of Montana leads the list with a 10.9 percent cut in state money. Followed by Montana State University at a 9.8 percent cut. And MSUY-Billings at a 8.5 percent cut. The libraries at Montana universities will experience cuts of $1.6 million for new materials. These cuts will not only hurt universities--they will also hurt the programs in which university students participate. For example, the Montana Reads literacy program--started by University of Montana President Dennison in 1997. This program is critical to the 60-plus University of Montana student volunteers who regularly tutor kindergarten through fifth grade Missoula students. I think it is simple common sense that a critical component of any successful literacy program is for the students to have books. These Montana tutors depend on book donations to help their students. The CARE Act helps them to help the elementary kids in Missoula. Of course these donations will also greatly aid adult literacy. Campaigns such as the Montana Adult Basic & Literacy Education, ABLE, program serve adults who lack sufficient mastery of basic skills to function in society, a high school diploma, or basic English skills. In Montana, 75,000 adults aged 25 and over do not have a high school diploma or a GED. Twenty-five thousand adults have less than a ninth grade education. Every effort we make to improve reading in Montana will suffer if we do not include books in the equation. The Federal Government granted 36 Montana schools $11 million over 3 years to find reading coaches, family literacy programs and tutors. These grants are so important to Montana. But if we fail to supply books as part of the equation, then the grants are not put to use in the most efficient way. Allowing charitable donations for books ensures that we use taxpayer dollars more effectively. We cannot afford not to. Madam President, earlier this year, Senator Grassley and I reintroduced S. 701, the Rural Heritage Conservation Act. This bill will help the nation's hard-working farmers and ranchers preserve their heritage and way-of-life. At the same time, it promotes conservation of valuable open space and wildlife habitat. This legislation is included as a provision in the CARE Act. S. 701 provides targeted income tax relief to small farmers and ranchers who wish to make a charitable contribution of a qualified conservation easement. The bill would allow eligible farmers and ranchers to increase the currently deductible amount for charitable contributions of qualified conservation easements. That means that farmers and ranchers can deduct amounts up to 100 percent of adjusted gross income. The bill also extends the carryover period from 5 years to 15 years. In the case of all other landowners, the AGI limitation would be raised from 30 percent to 50 percent. Senator Grassley has worked closely with me to include the provisions of S. 701 in the CARE Act. I believe our bipartisan cooperation is the reason why we have come so far in moving this very important piece of legislation. Passing the provisions in S. 701 will mean that farmers and ranchers facing the potential of having to sell their ranch will have another financially viable option. Under this proposal, they will be able to choose to take advantage of the conservation easement incentives, stay on their land, and invest in their farming or ranching business. In practical terms, that means these farmers and ranchers do not have to sell the family farm or ranch. They can keep it in the family. This is so important to preserving the character and economic vitality of our rural communities. Over the past 25 years, over 3 million acres of agricultural lands have been lost to development in Montana alone. Many of those lands were lost when family farms--hit hard by tough times--were forced to give up their generations' old farming operations and sell to developers in order to pay the bills. We have to find additional tools to help these folks keep their land in agricultural production and in open space. Our legislation provides one of those tools. To illustrate why this legislation is so important, let me give you an example of the impact of current law on farmers and ranchers. Jerry Townsend was born and raised on his family's ranch in Highwood, Montana. He has operated the ranch since purchasing it from his parents in 1974. On his ranch, called the Elk Run Ranch, he raises commercial beef cattle. In 1995, Mr. Townsend donated a conservation easement to the Montana Land Reliance. His ``donation'' was calculated at $528,000. However, because his ranch is held as a C corporation, his tax deduction was limited to10 percent of the ranch's net income. His tax deduction over the six years totaled a paltry $1,998--less than one percent of the total value of his donation. In contrast, a landowner with more in income would have a much greater incentive to enter into an easement agreement because he or she would be able to deduct more of the value of the donation from their taxes. S. 701 would do nothing more than level the playing field for farmers and ranchers when it comes to the tax benefits of donating conservation easements. What should matter is the value of your land--not the amount of your income. Our conservation easement bill, and as included in the CARE Act, have been endorsed by 210 land trusts representing 44 States. Other supporters include the Montana Stockgrowers, the American Farmland Trust, and the Colorado Cattlemen. This is a win-win proposition. Farmers and ranchers will be able to preserve their important agricultural and ranching lands for future generations. They will be able to continue to operate their businesses. They will be able to stay on their land. It is a purely voluntary, incentive-based way to promote conservation. And it will allow us to bring people together. Landowners. Conservationists. The Federal Government. And local communities. All working together to preserve our precious natural resources and agricultural heritage. Madam President, I rise to talk about another important, but often overlooked, aspect of the CARE Act additional funding for the Social Services Block Grant, or SSBG. SSBG funds are very flexible. States can use these funds to assist abused children cope with their trauma; to help seniors live at home, instead of nursing homes; to provide day care for children in low- income working families; so that we know those kids are in safe places while their parents work; to assist the disabled so that they can fully participate in our society; to help parents adopt children, so that every child has a loving parent. In my State of Montana, we use SSBG to help children with developmental disabilities, like those with cerebral palsy. SSBG is ``glue money.'' Communities use it to fill holes in the safety net. It is up to States and localities to decide where it goes. We give them a long menu of options, and they use it the way they see fit, based on local needs. This bill provides over $1 billion more in SSBG to fill those holes over 2 years. The goal of the CARE Act is to increase compassionate activity in our country. We are a big-hearted country. We want to help each other. This bill will help turn more of that desire into action and will make sure Government is doing its part. SSBG funds support the activities of faith-related charities. We give the money to the States and they often contract with faith-related organizations to do the hands-on work that they do so well. If you want to support Catholic Charities, then you should support SSBG. If you want to support Lutheran Social Services, then you should support SSBG. These organizations have told me that SSBG funds are crucially important to them. The CARE Act is about increased individual giving. That is absolutely vital. But if the Government does less, then any increase in individual giving may only be filling that gap left by the withdrawal of the Government. The additional SSBG funding in this bill is our way of saying that the Government will keep its part of the bargain and continue to play a role. It is a flexible source of funds, so it won't be bureaucrats in Washington dictating the money will be used. And much of the funding will go to faith-related charities--the very organizations we want to bolster. We haven't talked much about the SSBG provision. That is a good sign. Around here, we tend to talk about the things we disagree about. I am glad we could find common ground on this provision so easily. I'm sure the faith-related charities will thank us for doing so. I commend Senators Lieberman and Santorum for their work on the CARE Act. Madam President, on February 5, 2003, the Finance Committee passed tax shelter legislation to offset the cost of the CARE Act. How appropriate it is for a bill to encourage more charitable giving to be paid for by those shirking their responsibility to pay their fair share of taxes. The tax shelter legislation included in the CARE Act was developed by the Finance Committee over the past 4 years. The committee has taken time to develop appropriately targeted legislation. Care has been taken to avoid encumbering legitimate business transactions. Nevertheless, we will all be burdened until we get this problem in check. Without these changes, honest businesses will continue to be burdened to the extent they compete against companies avoiding taxes. Tax shelters are carefully engineered tax transactions. Most have little or no economic substance. That means that they are designed to achieve unwarranted tax benefits rather than business profit. And, they place honest taxpayers at a considerable disadvantage. As Michael Graetz, Professor of Law at Yale University, once said: ``a tax shelter is a deal done by very smart people that, absent tax considerations, would be very stupid.'' It is time to put a stop to the unsavory practice of mining the Tax Code for these abusive shelters. These transactions are designed to take advantage of the complexity of the tax law to obtain benefits that Congress never intended. They pose a real threat to the integrity of our self-assessment system by eroding the public's respect of the tax law. Under tax shelter legislation produced by the Finance Committee, promoters, advisors, and taxpayers would be subject to stiff penalties for failing to acknowledge these transactions to the IRS. Treasury believes that if a taxpayer feels comfortable entering into a transaction; if a promoter feels comfortable selling a transaction; and, an advisor feels comfortable recommending a transaction, they should all feel comfortable disclosing the transaction to the IRS. We have worked closely with the Treasury Department in crafting this legislation. We have given Treasury authority to fine-tune the provisions so as to protect legitimate tax planning. But make no mistake, I am committed to combating abusive tax transactions. The tax shelter package is the first installment. It will not be the last. The tax shelter package reinforces steps already taken by Treasury by requiring more transparency. Taxpayers will now be required to disclose certain reportable transactions on their tax returns or face stiff penalties. Promoters will have to provide information to IRS on their tax avoidance strategies or face stiff sanctions. These provisions are designed to change the cost-benefit ratio of those contemplating engaging in egregious tax planning strategies. The bill would also eliminate abusive tax shelters by denying tax benefits with little or no economic substance. That means that taxpayers will have to enter into transactions for legitimate economic and business reasons and not purely for tax avoidance. This was the key recommendation made by the Joint Committee on Taxation in response to the investigation of Enron's tax transactions. Presently, there is lack of uniformity regarding the proper application of the economic substance doctrine. Some courts apply a conjunctive test that requires a taxpayer to establish the presence of both economic substance and a substantial nontax business purpose. Other courts have found the existence of one of these as sufficient to respect a transaction. The provision will clarify the application of the doctrine. It does not tell the court when to apply it. A tax shelter disallowed in New York should not be permitted elsewhere. The clarification ensures uniformity across the country. The tax shelter legislation included in the CARE Act is only a down payment. It will go a long way toward curbing abusive transactions. But it is not the final answer. Based on the Joint Committee's investigation of Enron's tax returns, additional steps are needed. The Joint Committee made several specific recommendations for additional changes. We are looking closely at these recommendations. Additional legislation will be forthcoming. I am confident we will make any additional changes with bipartisan support. Enron kept the IRS in the dark and out-maneuvered. The lack of adequate disclosure rules and the lack of sufficient IRS enforcement resources clearly helped Enron and its executives walk away with millions maybe billions. Our legislation would bring more transparency to these Enron-type transactions. The Enron report clearly demonstrates the need for meaningful shelter legislation. I urge my colleagues to support this measure.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent the order for the quorum call be rescinded.

Mr. BAUCUS. Mr. President, I thank the chairman of the Finance Committee, Senator Grassley, for the great job he has done in putting this bill together. It is not easy. There are lots of different components and many Senators have legitimately different points of view. I commend him for his yeoman work. He is not here at the moment, but I want him to know, in the arena of the Senate, and publicly, he has done a great job. The folks in Iowa must be very proud of him. The chairman and I together are considering a bill designed to help charitable organizations--that is the main goal here--and, therefore, to help our communities. The bill is called the Charity Aid Recovery and Empowerment Act, otherwise known as CARE. Our President said it well: In order to fight evil we must do good. [And] it is the gathering momentum of millions of acts of kindness and compassion which define the true face of America. I think that is very true. More than peoples in any other country, Americans are noted for their openness, their generosity, and their kindness. At a time when Americans are at war and our economy is sagging, this bill is more important than ever. The economy is in worse shape than it has been in over a decade. Too many Americans go to bed hungry at night. Two million Americans have lost their jobs since 2001. Men, women, and children are increasingly relying on charities to meet their needs. The problem is made worse because our States are strapped with huge budget deficits. States are actually the No. 1 provider of social services, but presently they are experiencing the largest deficits they have had in 40 years. This is where charities come in. Charities deliver food, water, clothing, and counseling to those in need. They are the first responders to these quiet tragedies. Let me give a few examples from my own home State of Montana. Each year, the Montana Food Bank Network serves 1.5 million meals, including 200,000 meals to our State's children. Clearly our children can't learn if they go hungry. There are roughly 30 adult literacy programs in Montana serving over 5,000 people. Programs such as the Adult Literacy Center in Billings, MT, and the Literacy Volunteers of America in Butte provide free adult literacy classes to anyone who walks in the door, free to anyone who walks in. Groups like the Blackfoot Challenge provide local voluntary solutions to environmental problems like restoring stream habitat. I copied the model of Senator Bob Graham of Florida. He has what is called workday projects once a month and I do, too. One day I worked at Blackfoot Challenge and all of us together in the Blackfoot Valley--not all but a bunch of us, 15 people--volunteered our time and work to restore a stream habitat. Ranchers in the old days just plowed a straight channel through their places and eliminated the meandering nature of streams, which made it difficult for bull trout to come up and spawn. We decided to do this project together, in part because the higher-ups couldn't agree on anything. The Fish and Wildlife Service, State Fish and Wildlife, and Parks and all the government agencies couldn't get together, so locally we just said we are going to do it ourselves--and we did. It is such volunteer, charitable efforts that make a huge difference. Our State's economy also benefits from tourism, and keeping our streams clean and teeming with fish is good for our economy. In fact, I might say, I was delayed coming to the floor because I was talking to a fellow who could hardly wait to get back to Montana because the right hatch is going on now. He is going to go fishing in the next couple of days. He couldn't wait to get back home. The list goes on: Montanans, working in homeless shelters, churches, libraries, schools, boys and girls clubs, substance abuse centers, and jails. Our State is not alone. This is true all across our country. In communities, millions of Americans depend upon the generosity of their neighbors and upon charitable organizations. The CARE Act is designed to help these organizations, helping them by creating incentives to encourage more contributions to charity--help them receive more contributions. Let me describe some of the main provisions of the bill. The provision that has received the most attention is the above-the-line deduction for charitable contributions for people who do not itemize their deductions. Most Americans actually use the standard deduction-- about 70 percent. This says: OK, all you folks who use the standard deduction--that is, you do not itemize your deductions--we will provide for an above-the-line charitable contribution for you as well, even though you do not itemize. I must say, I have some concerns about this provision. Why? Because we tried this before. It didn't work very well. That is why we eliminated the deduction in 1986. More specifically, I am concerned that the deduction will not provide much of an incentive for charitable giving while making the Tax Code even more complicated. Nonetheless, the President has made this particular proposal a top priority and, in light of that, I am willing to give the proposal a chance. So we limited the proposal to 2 years to give us time to study it and see how it is working and gain from the experience. While the nonitemizer deduction has received most of the attention, there are several other provisions of the bill that have strong bipartisan support. They could provide a significant boost to charitable giving. First, we provide enhanced deductions for contributions of food, of books, and computers. In response to growing economic hardship and hunger that has gone along with it, we have increased the deduction for contributions of surplus food. In most cases, the Tax Code provides the same tax deduction for food hauled to a landfill as it does for food donated to charities. That does not make a lot of sense. Businesses that choose to contribute food instead of throwing it away are faced with the added costs of storing, packaging, and trucking the food to the charity. So our new enhanced deduction will encourage business, farmers, and ranchers to contribute the food by offsetting these costs associated with the donations. This makes it easier for the farmer in Montana to receive a fair deduction for giving food to a local food bank, for example. We also make it easier for a publisher to donate extra books to a local library. Sometimes lots of books get stacked up and cannot be sold. I think it is a good idea to be able to donate them. And kids will be able to get much better access to computers and cutting edge technology. Second, we expand the IRA rollover exception to allow individuals to donate their IRAs directly to charity without taking a tax hit. Under current law, taxpayers, say, who are prospective donors would include their IRA income as taxable income and then take a corresponding charitable deduction, subject to limits, when they want to donate that IRA to a charity. The provision in the bill makes that easier, allowing direct giving; that is, streamlining the process and eliminating the limits that impede giving. Third, in this bill we provide several important new incentives for voluntary conservation; for example, incentives to encourage contributions of conservation easements, which are so important, especially for my State of Montana and throughout the Nation. This means that cash poor/land rich farmers--which I must say, regrettably, is the rule, not the exception--can donate the conservation rights of their property and get a tax benefit and still keep the family farm in the family. While the majority of the provisions in this bill encourage giving to charities, there are also provisions that help ensure that charities are responsible public citizens. As many have noticed, national newspapers have recently detailed the secretive use of charities by terrorist organizations. This is, obviously, a serious problem. The large majority of American charities are law abiding and serve an invaluable function. But there are a few exceptions. So this legislation gives authority to the IRS to immediately revoke the tax-exempt status of charities that are suspected of giving aid to terrorist groups. When there is a crisis in confidence with respect to charities, it hurts honest groups. The charities that have worked hard to further their noble missions should not be jeopardized because of bad ``charities'' doing bad things. The Finance Committee bill attempts to cure this by giving watchdogs and donors better tools to monitor the activities of charities. The CARE Act gives State attorneys general more authority to review the IRS filings of tax-exempt organizations. In addition, the bill lets donors see more information about communications between charities and the IRS. These important steps will go a long way to help restore America's confidence in charities. I have just provided some highlights of the bill, but there are a number of other important provisions. All told, this package includes many proposals that enjoy widespread support. It has bipartisan support. In fact, many provisions have been approved by the Senate. With war costs on the horizon, and current budget deficits, it is essential we pay for this bill. I applaud Chairman Grassley for insisting that these tax cuts be paid for. So let me turn to the provisions which cover the costs. First, we have included a proposal that takes aim at the proliferation of abusive tax shelters. I, along with Senator Grassley, introduced the Tax Shelter Transparency Act to encourage more timely and accurate disclosure of these abusive transactions. Under the proposal, we provide a disincentive to promoters, advisors, and taxpayers by subjecting them to stiff penalties for failing to acknowledge these transactions to the IRS. The proposal also clarifies a definition of what is known as economic substance. That means it forces companies to engage in real business planning instead of tax-driven hoaxes. The Joint Committee on Taxation recently released its Enron report. The transactions it reviewed demonstrate the need for strong anti-avoidance rules to combat tax- motivated transactions. These deals might satisfy the technical requirements of the Tax Code, as well as administrative rules, but they serve little or no other purpose than to generate income tax or financial statement benefits; that is, there is no economic substance to the transactions. And the American taxpayers are cheated, frankly-- those who do not have the ability to hire high-paid counsel and accountants to find these very complicated measures which, frankly, even the IRS cannot figure out in a lot of cases. It is just not right when the majority of taxpayers--such as the hardware store owner, say, in Butte, MT--have to pay their fair share of taxes while these big corporations twist their way out of paying their own fair share. That is, I think, simply wrong. But it is the right thing to do to use this proposal to pay for tax incentives to benefit the charitable community. It is the right thing to do and the right time to do it. I urge my colleagues to support this legislation. I yield the floor.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask unanimous consent for floor privileges during the consideration of the CARE Act for Tyler Garnett and Shawn White.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I am introducing a very important piece of legislation to modify the cooperative dividend allocation rule. I would like to thank Senator Grassley and my other colleagues that have signed on the bill for their support for correcting this rule. America's agriculture industry has not had it easy in recent years. In Montana and other areas of the country, drought, low prices and the economic downturn have hit our farms and ranches hard. Over the past few years Congress has worked diligently to help our Nation's smaller agriculture producers. However, there is more work to be done. Senator Grassley and I recently introduced ``The Tax Empowerment and Relief for Farmers and Fisherman Act'', TERFF, with the intention of giving farmers the tools to help themselves. One provision within that Act deals with the payment of dividends on cooperatives' stock. Today we are introducing that provision on its own to emphasize the importance of changing the dividend allocation rule. Currently, the dividend allocation rule reduces patronage income when a cooperative pays a dividend on capital stock from non-patronage earnings. This reduces the amount cooperatives can pay back to their farmer patrons and inhibits their ability to equity-finance operations. Modifying this rule will make farmer cooperatives more competitive and provide better access to capital. This piece of legislation will help revitalize farmer cooperatives by providing more accurate tax treatment for patronage and non-patronage income. I look forward to working with my colleagues to enact the critical piece of legislation. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. BAUCUS. Mr. President, I rise today to join my friend and colleague Senator Inhofe in introducing a bill that will make a real difference in schools on or near military bases, Indian reservations, and other Federal lands. Our bill will make the Impact Aid Program a Federal entitlement. We require public schools to accept all children from military families and tribal reservations. It is the right thing to do. But families in Federal housing or on reservations do not pay local property taxes, a traditional revenue source for school districts. While Impact Aid was designed to make up the difference, we have not met our obligation to public schools. Instead, we have let the Impact Aid Program fall prey to the annual appropriations process. This means that payments to Impact Aid schools are never guaranteed, are usually underfunded, and rarely arrive on time. In fact, Impact Aid has not been fully funded since the early 1980s. The result of this underfunding can been seen in Impact Aid schools in States across the country. Schools are cutting programs and staff, not buying new books and materials, and deferring maintenance on buildings to help cover classroom costs. As a result, schools like Hays Lodge Pole School in Montana cannot teach their students and maintain their school facility; in the last couple of years, the Hays Lodge Pole School has been susceptible to electrical fires and other structural hazards. I am so proud of the students, teachers, and administrators that learn and work in our Impact Aid districts. They have gone above and beyond to make due with scant resources. In many cases, however, we have stretched school districts to the breaking point. We have an obligation to our schools and the students. We can and must do better than we have in the past. The bill that Senator Inhofe and I are introducing today will make a difference. It requires the Federal Government to meet its obligation to these schools. As a result, districts will know when and how much they will receive. The guesswork will vanish, and school leaders will be able to focus on student achievement instead of budget games. I recognize that creating a Federal entitlement program is not an easy task. But Impact Aid is not like other discretionary programs. It was set up to compensate school districts for the ``substantial and continuing financial burden resulting from Federal activities.'' It is not a program that supplements local programming. It is the only game in town, and when we do not meet our Federal obligation, there is no other program to pick up the slack. Other Federal education programs, such as title I, supplement insufficient local resources. Importantly, Impact Aid is a Federal program that addresses Federal needs. Our bill recognizes that providing Impact Aid resources on time and in full helps federally impacted students learn and achieve. It also recognizes that Impact Aid funds are better spent in our schools than on plane tickets and expenses for Impact Aid officials to come to Washington to fight for dollars that they inherently deserve. Finally, I want to say a little about my personal perspective on education. I honestly believe there is nothing more important than giving our children the best opportunities to succeed in life. That is a principle I hold very deeply. Nothing we can do for our children will make a bigger difference in their lives than giving them a solid education. Education provides greater advantages in the workplace, and greater personal enrichment; both of which lead to future personal and professional success. I have always believed that a quality public education system is not only the right of every child, but also the key to smart economic development. The investments we make in our education system today will provide our children with the skills and knowledge to be successful in the 21st century economy. Our bill recognizes the importance of education and makes sure that our federally impacted school districts receive the money they deserve. More importantly, our bill makes sure that students in federally impacted schools will have an education that will prepare them for personal and professional success.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today I am introducing a very important piece of legislation to modify the cooperative dividend allocation rule. I would like to thank Senator Grassley and my other colleagues that have signed on the bill for their support for correcting this rule. America's agriculture industry has not had it easy in recent years. In Montana and other areas of the country, drought, low prices and the economic downturn have hit our farms and ranches hard. Over the past few years Congress has worked diligently to help our Nation's smaller agriculture producers. However, there is more work to be done. Senator Grassley and I recently introduced ``The Tax Empowerment and Relief for Farmers and Fisherman Act'', TERFF, with the intention of giving farmers the tools to help themselves. One provision within that Act deals with the payment of dividends on cooperatives' stock. Today we are introducing that provision on its own to emphasize the importance of changing the dividend allocation rule. Currently, the dividend allocation rule reduces patronage income when a cooperative pays a dividend on capital stock from non-patronage earnings. This reduces the amount cooperatives can pay back to their farmer patrons and inhibits their ability to equity-finance operations. Modifying this rule will make farmer cooperatives more competitive and provide better access to capital. This piece of legislation will help revitalize farmer cooperatives by providing more accurate tax treatment for patronage and non-patronage income. I look forward to working with my colleagues to enact the critical piece of legislation. I ask unanimous consent that the text of the legislation be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to join my friend and colleague Senator Inhofe in introducing a bill that will make a real difference in schools on or near military bases, Indian reservations, and other Federal lands. Our bill will make the Impact Aid Program a Federal entitlement. We require public schools to accept all children from military families and tribal reservations. It is the right thing to do. But families in Federal housing or on reservations do not pay local property taxes, a traditional revenue source for school districts. While Impact Aid was designed to make up the difference, we have not met our obligation to public schools. Instead, we have let the Impact Aid Program fall prey to the annual appropriations process. This means that payments to Impact Aid schools are never guaranteed, are usually underfunded, and rarely arrive on time. In fact, Impact Aid has not been fully funded since the early 1980s. The result of this underfunding can been seen in Impact Aid schools in States across the country. Schools are cutting programs and staff, not buying new books and materials, and deferring maintenance on buildings to help cover classroom costs. As a result, schools like Hays Lodge Pole School in Montana cannot teach their students and maintain their school facility; in the last couple of years, the Hays Lodge Pole School has been susceptible to electrical fires and other structural hazards. I am so proud of the students, teachers, and administrators that learn and work in our Impact Aid districts. They have gone above and beyond to make due with scant resources. In many cases, however, we have stretched school districts to the breaking point. We have an obligation to our schools and the students. We can and must do better than we have in the past. The bill that Senator Inhofe and I are introducing today will make a difference. It requires the Federal Government to meet its obligation to these schools. As a result, districts will know when and how much they will receive. The guesswork will vanish, and school leaders will be able to focus on student achievement instead of budget games. I recognize that creating a Federal entitlement program is not an easy task. But Impact Aid is not like other discretionary programs. It was set up to compensate school districts for the ``substantial and continuing financial burden resulting from Federal activities.'' It is not a program that supplements local programming. It is the only game in town, and when we do not meet our Federal obligation, there is no other program to pick up the slack. Other Federal education programs, such as title I, supplement insufficient local resources. Importantly, Impact Aid is a Federal program that addresses Federal needs. Our bill recognizes that providing Impact Aid resources on time and in full helps federally impacted students learn and achieve. It also recognizes that Impact Aid funds are better spent in our schools than on plane tickets and expenses for Impact Aid officials to come to Washington to fight for dollars that they inherently deserve. Finally, I want to say a little about my personal perspective on education. I honestly believe there is nothing more important than giving our children the best opportunities to succeed in life. That is a principle I hold very deeply. Nothing we can do for our children will make a bigger difference in their lives than giving them a solid education. Education provides greater advantages in the workplace, and greater personal enrichment; both of which lead to future personal and professional success. I have always believed that a quality public education system is not only the right of every child, but also the key to smart economic development. The investments we make in our education system today will provide our children with the skills and knowledge to be successful in the 21st century economy. Our bill recognizes the importance of education and makes sure that our federally impacted school districts receive the money they deserve. More importantly, our bill makes sure that students in federally impacted schools will have an education that will prepare them for personal and professional success.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to thank Greg Mastel for his work as the Finance Committee's chief trade adviser and chief economist during the 107th Congress. I asked Greg to rejoin my staff in early 2001 with two specific goals in mind--significantly expanding the Trade Adjustment Assistance Program and reinstating fast-track trade negotiating authority for the President. To me, these are the twin pillars of U.S. trade policy. If the United States was to move beyond the logjam that had stalled progress on trade for nearly a decade, both of these programs needed to be in place. Thanks in large part to Greg's hard work, both of those goals were achieved. In August of last year, the President signed into law the Trade Act of 2002. Not only did it restore fast track to the President, it also created the largest expansion of Trade Adjustment Assistance in that program's history. And just for good measure, we renewed and expanded both the Andean Trade Preferences Act and the Generalized System of Preferences. The Trade Act of 2002 is the most significant piece of trade legislation to come out of the Congress in over a decade. And it would not have happened without the skilled guidance and steady hand that Greg showed every step of the way. Getting there wasn't easy. There were a lot of long nights and more than a few tense meetings. And for Greg, there were some personal challenges that didn't make the job any easier, but made his performance even more impressive. Shortly before we went into conference with the House on the Trade Act, Greg suffered a nasty bicycling accident that left him with a broken collarbone, badly bruised ribs, and more sore muscles than I care to think about. But Greg was in the office every day, working through the pain and showing the same good humor that always made him such a pleasure to work with. At the time, I called Greg ``the Lance Armstrong of the Trade World''--although he probably needs to hone those biking skills. I stand by those comments. In conference negotiations, it is always a challenge to bridge the differences between Democrats and Republicans and between the Senate and the House. But to sit in a room negotiating the finer points of U.S. trade policy at 2 in the morning while fighting through the pain of broken collarbone takes a special kind of staffer. Not only is Greg an expert on trade--he also understands the state of Montana. Greg is a true product of Montana. He grew up on a ranch outside of Missoula, where his childhood pursuits included hunting, camping, and archery. He is a graduate of Hellgate High School in Missoula, where he was a star second baseman on their baseball team. He has never forgotten his roots in Montana. I have always felt that Greg's experiences back home gave him a feel for policy issues that cannot be learned. And Greg has a long history with my office. He began as an intern in 1987, and within a few months became my youngest legislative assistance. His formal training as an economist made him a natural for covering international trade issues, vital for a State that depends on exporting its goods and services to markets around the globe. I relied on Greg to assist me with some of the most important issues to Montanans, including beef exports to Japan and wheat exports to China. At various points, Greg has served as both my legislative director and my chief of staff. In each of these positions, he served with distinction through many years of trying to convince Montanans that trade was necessary and could be beneficial. He came up with the idea of trade missions and helped organize those to Asia and South America. Those missions did more to promote understanding than 100 speeches could have. Greg also became an expert on U.S. trade laws, including many which he helped to draft. It was a natural that, after leaving my staff in 1994, Greg moved on to a distinguished career in academia and public policy. He is the author of three books dealing with China, United States trade laws, and WTO negotiations, and has written a column for the Journal of Commerce. Somewhere along the way, Greg and his wife Lois found the time to raise two beautiful children--Alexander and Caroline. I was lucky to be able to lure him back for the 107th Congress to serve as my chief trade adviser on the Finance Committee. Greg has been a wonderful friend to me and my staff over the years. I thank him for all of this hard work and wish him the best of luck in all his future endeavors.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, on vote No. 122, I voted aye. It was my intention to vote no. I ask unanimous consent that it be recorded as no. It does not change the outcome of the vote.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I rise today to support the Tax Court Modernization Act. I am pleased to be an original cosponsor of this important legislation. In 1969, Congress elevated the U.S. Tax Court as a Federal court of record under Article I of the Constitution of the United States. Congress created the Tax Court to provide a judicial forum in which affected persons could dispute tax deficiencies determined by the Commissioner of the Internal Revenue Service prior to payment of the disputed amounts. That means that the Tax Court's jurisdictional requirements are, in part, a recognition that lower and middle income taxpayers cannot necessarily pay the tax deficiency before taking their dispute to court. Congress also closely linked the legislation governing the Tax Court with the laws governing the Article III District Courts. Unfortunately, the Congress did not include the Tax Court in the changes made for Article III courts. This legislation is designed to restore parity between the Tax Court and Article III courts, and to modernize their personnel and pension systems. I also want to thank Senators Breaux and Hatch for their efforts in moving this legislation forward. The Finance Committee intends to markup the Tax Court Modernization Act tomorrow. It is my hope that the Committee favorably reports the legislation. I also hope that, soon after Committee action, Majority Leader Frist and Minority Leader Daschle bring the Tax Court Modernization Act to the floor for swift passage.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today, I am re-introducing the American Indian Welfare Reform Act, an important step in improving the lives of this country's Native Americans. I originally introduced this bill last year and worked to include important elements of it in the welfare reform reauthorization bill approved by the Finance Committee. Unfortunately, we did not finish work on welfare reform reauthorization. So I am again offering this bill, with some improvements based on advice from tribes and other experts. I am glad to be joined by Senators Daschle, Johnson, Campbell, Bingaman, Inouye, and Akaka. In 1996 we enacted a sweeping welfare reform law. It was a long past- due fundamental change and ended a failed system for helping low-income families in America. I was a strong supporter of that law. This year, we continue to work to reauthorize it. As we in the Finance Committee have reviewed the evidence I have been struck by how successful it has been. The ranks of those dependent on welfare in this country has been reduced by half in just five years. There is more to be done, of course. Child poverty has declined but not by as much as the fall in the welfare caseload, for example. I plan to work with my Finance Committee colleague Senator Grassley on comprehensive legislation to renew and improve the 1996 law. One often overlooked important aspect of the 1996 law is that it didn't just devolve authority to States--it also permitted Indian tribes to operate their own welfare programs for the first time. The new welfare program, Temporary Assistance for Needy Families, TANF, is very flexible. Tribes can take advantage of that flexibility to design culturally-appropriate programs to move people from welfare to work. This is smart policy and is consistent with the important value of tribal sovereignty. I support it. My own State of Montana is home to several tribes and I have given much thought to how we can build upon the provisions of the 1996 welfare law to help them and their members. Too often in Montana--and elsewhere--poverty has an Indian face. The numbers are cold and hard. According to the Census Bureau, 25.9 percent of American Indians live in poverty, more than twice the national poverty rate. The average household income for Indians in 2000 was only 75 percent of that of the rest of Americans. This is simply not right. We must do better. Welfare reform needs to work for everyone. Luckily, the provisions of the 1996 law provide a good start. Now we must build upon them. The legislation I introduce today, the product of extensive dialogue and consultation, does that in several important ways. First, more than 30 tribes--including the Confederated Salish- Kootenai and Fort Belknap tribes of Montana--have taken advantage of the opportunity to operate their own TANF programs. This bill contains provisions to help those tribes improve their programs. For example, under current law, tribes operating TANF are not eligible for the TANF high performance bonus or the TANF contingency fund while state TANF programs are. This oversight is rectified by this bill. Second, there are many tribes interested in operating TANF programs who do not believe the current set-up allows them to do so. They want to exercise their sovereignty and adapt their program to better fit the needs of their people. We should help them do so. To that end, I propose creating a new grant fund to improve tribal governmental capacity. We have funded State administrative capacity for decades, helping States buy computer systems and train workers. We should do the same for tribal human services administration. Under this bill, a tribe which wants to operate TANF but needs to upgrade its computers to do it could receive the funding it needs--which will enable it to take over TANF. Third, there are some tribes not interested in running a TANF program or a long time from being able to do it. Their low-income families will continue to receive assistance from State programs. I have included provisions to facilitate State-tribe dialogue in these cases so that the state can better understand the unique circumstances of each Indian reservation. There is also an important provision to allow States the same flexibility in designing welfare-to-work programs on high unemployment reservations that tribes gain when they operate TANF programs. We must ensure all Indian families are able to get help when they need it. Finally, there is the all-important issue of economic development. A General Accounting Office review of Census Bureau data found that 25 of the 26 counties in the U.S. with a majority of American Indians had poverty rates ``significantly'' higher than average. Welfare reform is about moving people to work. On most of our Indian reservations there is simply far too little work to be had. Like everyone else, Indians want to work. We need to do better in giving them the opportunity. This legislation provides tribes with an expanded authority to issue bonds, which will encourage additional economic activity on reservations, such as housing construction. This means more jobs, as well as a better quality of life. It also includes grants to help tribes improve their own economic development strategies. Tribes with uniform commercial codes and effective micro-enterprise programs can see more business activity on their lands. This bill helps tribes helps themselves. We need to let Indians find their own way to prosperity, not impose top-down strategies. But we must make sure they have the tools to get there. This is an important bill. It includes other key provisions. One is a fine bill originally introduced by Senators Daschle and McCain to allow tribes to receive direct Federal reimbursement for operating foster care programs. Another provision funds research on tribal welfare reform programs so we can learn what works as well as providing funds for ``peer-learning'' so that tribes can learn from one another. I am a strong supporter of welfare reform. We need to make sure it works for everyone. This bill does that. I ask unanimous consent that a summary of the legislation be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today, I am re-introducing the American Indian Welfare Reform Act, an important step in improving the lives of this country's Native Americans. I originally introduced this bill last year and worked to include important elements of it in the welfare reform reauthorization bill approved by the Finance Committee. Unfortunately, we did not finish work on welfare reform reauthorization. So I am again offering this bill, with some improvements based on advice from tribes and other experts. I am glad to be joined by Senators Daschle, Johnson, Campbell, Bingaman, Inouye, and Akaka. In 1996 we enacted a sweeping welfare reform law. It was a long past- due fundamental change and ended a failed system for helping low-income families in America. I was a strong supporter of that law. This year, we continue to work to reauthorize it. As we in the Finance Committee have reviewed the evidence I have been struck by how successful it has been. The ranks of those dependent on welfare in this country has been reduced by half in just five years. There is more to be done, of course. Child poverty has declined but not by as much as the fall in the welfare caseload, for example. I plan to work with my Finance Committee colleague Senator Grassley on comprehensive legislation to renew and improve the 1996 law. One often overlooked important aspect of the 1996 law is that it didn't just devolve authority to States--it also permitted Indian tribes to operate their own welfare programs for the first time. The new welfare program, Temporary Assistance for Needy Families, TANF, is very flexible. Tribes can take advantage of that flexibility to design culturally-appropriate programs to move people from welfare to work. This is smart policy and is consistent with the important value of tribal sovereignty. I support it. My own State of Montana is home to several tribes and I have given much thought to how we can build upon the provisions of the 1996 welfare law to help them and their members. Too often in Montana--and elsewhere--poverty has an Indian face. The numbers are cold and hard. According to the Census Bureau, 25.9 percent of American Indians live in poverty, more than twice the national poverty rate. The average household income for Indians in 2000 was only 75 percent of that of the rest of Americans. This is simply not right. We must do better. Welfare reform needs to work for everyone. Luckily, the provisions of the 1996 law provide a good start. Now we must build upon them. The legislation I introduce today, the product of extensive dialogue and consultation, does that in several important ways. First, more than 30 tribes--including the Confederated Salish- Kootenai and Fort Belknap tribes of Montana--have taken advantage of the opportunity to operate their own TANF programs. This bill contains provisions to help those tribes improve their programs. For example, under current law, tribes operating TANF are not eligible for the TANF high performance bonus or the TANF contingency fund while state TANF programs are. This oversight is rectified by this bill. Second, there are many tribes interested in operating TANF programs who do not believe the current set-up allows them to do so. They want to exercise their sovereignty and adapt their program to better fit the needs of their people. We should help them do so. To that end, I propose creating a new grant fund to improve tribal governmental capacity. We have funded State administrative capacity for decades, helping States buy computer systems and train workers. We should do the same for tribal human services administration. Under this bill, a tribe which wants to operate TANF but needs to upgrade its computers to do it could receive the funding it needs--which will enable it to take over TANF. Third, there are some tribes not interested in running a TANF program or a long time from being able to do it. Their low-income families will continue to receive assistance from State programs. I have included provisions to facilitate State-tribe dialogue in these cases so that the state can better understand the unique circumstances of each Indian reservation. There is also an important provision to allow States the same flexibility in designing welfare-to-work programs on high unemployment reservations that tribes gain when they operate TANF programs. We must ensure all Indian families are able to get help when they need it. Finally, there is the all-important issue of economic development. A General Accounting Office review of Census Bureau data found that 25 of the 26 counties in the U.S. with a majority of American Indians had poverty rates ``significantly'' higher than average. Welfare reform is about moving people to work. On most of our Indian reservations there is simply far too little work to be had. Like everyone else, Indians want to work. We need to do better in giving them the opportunity. This legislation provides tribes with an expanded authority to issue bonds, which will encourage additional economic activity on reservations, such as housing construction. This means more jobs, as well as a better quality of life. It also includes grants to help tribes improve their own economic development strategies. Tribes with uniform commercial codes and effective micro-enterprise programs can see more business activity on their lands. This bill helps tribes helps themselves. We need to let Indians find their own way to prosperity, not impose top-down strategies. But we must make sure they have the tools to get there. This is an important bill. It includes other key provisions. One is a fine bill originally introduced by Senators Daschle and McCain to allow tribes to receive direct Federal reimbursement for operating foster care programs. Another provision funds research on tribal welfare reform programs so we can learn what works as well as providing funds for ``peer-learning'' so that tribes can learn from one another. I am a strong supporter of welfare reform. We need to make sure it works for everyone. This bill does that. I ask unanimous consent that a summary of the legislation be printed in the Record.

Mr. BAUCUS. Mr. President, today Senator Grassley and I are taking a significant step forward in our efforts to simplify the tax code. Today, we are introducing an important simplification legislation--the Uniform Definition of Child Act. This legislation is based on the support of many for simplification in this area of the tax law. The President's FY 2004 budget, which was released on April 15, 2002, includes a simplification proposal to provide a uniform definition of a qualifying child. This is the first in a series of Department of Treasury ``white papers'' on simplification. The concept of a uniform definition of qualifying child also enjoys support from the American Bar Association, the American Institute of CPAs, the Tax Executives Institute, the Internal Revenue Service's Taxpayer Advocate, and staff of the Joint Committee on Taxation. Under current law, the complexity in this area is daunting. There are five commonly used provisions that provide benefits to taxpayers with children: the dependency exemption, the child credit, the earned income credit, the dependent care credit, and head of household filing status. Each of the five provisions uses variations of four principal criteria to determine whether a taxpayer qualifies for applicable tax benefits with respect to a particular child: age of the child, relationship of the child to the taxpayer, residency of the child with the taxpayer, and the amount of financial support provided the child by the taxpayer. Thus, a taxpayer is required to apply different definitions with respect to the same child when determining eligibility for these provisions. A taxpayer who qualifies with respect to a child for one provision does not necessarily qualify for another. As a result, publications, forms, instructions and schedules that are applicable to child related provisions number about 200 pages for the preparation of an individual income tax return. A tremendous number of families are impacted by these Code provisions. For example, 44 million taxpayers claimed the dependency exemption in the 2001 tax year. The IRS also indicates that a significant portion of the issued math error notices are attributable to these five provisions of the Internal Revenue Code. In 1999, for example, 44 percent of the 7.6 million math error notices were attributable to these provisions--40 percent of the total math error notices were attributable the dependency exemption, the child tax credit and the earned income tax credit alone. The legislation reduces complexity through reconciliation of the varying child definitions into a single definition for a ``qualifying child.'' The uniform child definition generally establishes eligibility for all five tax benefits if the child meets the age requirements described below, a relationship requirement, and a residency requirement--i.e., the child has the same principal place of abode as the taxpayer for more than one-half the taxable year. The residency requirement is an important departure from current law in which the child tax benefits frequently rely upon financial support tests which impose significantly higher administrative burdens in the form of additional record-keeping not otherwise required under the tax law. The legislation also preserves the tax rights of children who provide more than half of their own support by excluding those children from the uniform definition of a qualifying child. The underlying policy objectives of the present law provisions are retained. For example, the legislation retains underlying policy by not adjusting the ages of qualification--i.e., under age for the dependent care credit, under age 17 for the child tax credit, and under age 19-- or age 24 if a full-time student for the dependency exemption, the earned income tax credit, and head of household filing status. The legislation applies a single relationship test to the varying Code sections. Significantly, the proposal retains current law as an alternative to the extent that a person does not meet the revised uniform child definition--e.g., an elderly parent can still be claimed for purposes of the dependency exemption. Under the Uniform Definition of Child Act, there will be instances in which multiple taxpayers qualify with respect to a given child. To address this issue, the proposal extends the present law earned income credit tie-breaker rule to the other benefits for multiple eligible claimants. That rule awards the tax benefit (i) to a parent over a non- parent, (ii) to the parent with longer residency or the highest AGI if residency is not determinative between parents, and (iii) to the taxpayer with the highest AGI if all claimants are non-parents. Finally, the legislation continues to allow divorced or separated spouses to assign the dependency exemption and the child tax credit to non-custodial parents provided that certain support and residency tests are met. Simplification of the tax code should be more than just rhetoric. It is time for us to put legislation behind our words. We intend to continue to look at other areas of the tax code in need of simplification. Senator Grassley and I also want to thank our Finance Committee colleagues, Senators Hatch, Thomas and Lincoln, for their support of the Uniform Definition of Child Act of 2003. Simplification of the tax laws for the families of our nation is not partisan, it is not political, it is simply common sense. Mr. President, I ask unanimous consent that the Uniform Definition of Child Act of 2003 be printed in the Record.

Mr. BAUCUS. Mr. President, I rise today to support the Tax Court Modernization Act. I am pleased to be an original cosponsor of this important legislation. In 1969, Congress elevated the U.S. Tax Court as a Federal court of record under Article I of the Constitution of the United States. Congress created the Tax Court to provide a judicial forum in which affected persons could dispute tax deficiencies determined by the Commissioner of the Internal Revenue Service prior to payment of the disputed amounts. That means that the Tax Court's jurisdictional requirements are, in part, a recognition that lower and middle income taxpayers cannot necessarily pay the tax deficiency before taking their dispute to court. Congress also closely linked the legislation governing the Tax Court with the laws governing the Article III District Courts. Unfortunately, the Congress did not include the Tax Court in the changes made for Article III courts. This legislation is designed to restore parity between the Tax Court and Article III courts, and to modernize their personnel and pension systems. I also want to thank Senators Breaux and Hatch for their efforts in moving this legislation forward. The Finance Committee intends to markup the Tax Court Modernization Act tomorrow. It is my hope that the Committee favorably reports the legislation. I also hope that, soon after Committee action, Majority Leader Frist and Minority Leader Daschle bring the Tax Court Modernization Act to the floor for swift passage.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, today Senator Grassley and I are taking a significant step forward in our efforts to simplify the tax code. Today, we are introducing an important simplification legislation--the Uniform Definition of Child Act. This legislation is based on the support of many for simplification in this area of the tax law. The President's FY 2004 budget, which was released on April 15, 2002, includes a simplification proposal to provide a uniform definition of a qualifying child. This is the first in a series of Department of Treasury ``white papers'' on simplification. The concept of a uniform definition of qualifying child also enjoys support from the American Bar Association, the American Institute of CPAs, the Tax Executives Institute, the Internal Revenue Service's Taxpayer Advocate, and staff of the Joint Committee on Taxation. Under current law, the complexity in this area is daunting. There are five commonly used provisions that provide benefits to taxpayers with children: the dependency exemption, the child credit, the earned income credit, the dependent care credit, and head of household filing status. Each of the five provisions uses variations of four principal criteria to determine whether a taxpayer qualifies for applicable tax benefits with respect to a particular child: age of the child, relationship of the child to the taxpayer, residency of the child with the taxpayer, and the amount of financial support provided the child by the taxpayer. Thus, a taxpayer is required to apply different definitions with respect to the same child when determining eligibility for these provisions. A taxpayer who qualifies with respect to a child for one provision does not necessarily qualify for another. As a result, publications, forms, instructions and schedules that are applicable to child related provisions number about 200 pages for the preparation of an individual income tax return. A tremendous number of families are impacted by these Code provisions. For example, 44 million taxpayers claimed the dependency exemption in the 2001 tax year. The IRS also indicates that a significant portion of the issued math error notices are attributable to these five provisions of the Internal Revenue Code. In 1999, for example, 44 percent of the 7.6 million math error notices were attributable to these provisions--40 percent of the total math error notices were attributable the dependency exemption, the child tax credit and the earned income tax credit alone. The legislation reduces complexity through reconciliation of the varying child definitions into a single definition for a ``qualifying child.'' The uniform child definition generally establishes eligibility for all five tax benefits if the child meets the age requirements described below, a relationship requirement, and a residency requirement--i.e., the child has the same principal place of abode as the taxpayer for more than one-half the taxable year. The residency requirement is an important departure from current law in which the child tax benefits frequently rely upon financial support tests which impose significantly higher administrative burdens in the form of additional record-keeping not otherwise required under the tax law. The legislation also preserves the tax rights of children who provide more than half of their own support by excluding those children from the uniform definition of a qualifying child. The underlying policy objectives of the present law provisions are retained. For example, the legislation retains underlying policy by not adjusting the ages of qualification--i.e., under age for the dependent care credit, under age 17 for the child tax credit, and under age 19-- or age 24 if a full-time student for the dependency exemption, the earned income tax credit, and head of household filing status. The legislation applies a single relationship test to the varying Code sections. Significantly, the proposal retains current law as an alternative to the extent that a person does not meet the revised uniform child definition--e.g., an elderly parent can still be claimed for purposes of the dependency exemption. Under the Uniform Definition of Child Act, there will be instances in which multiple taxpayers qualify with respect to a given child. To address this issue, the proposal extends the present law earned income credit tie-breaker rule to the other benefits for multiple eligible claimants. That rule awards the tax benefit (i) to a parent over a non- parent, (ii) to the parent with longer residency or the highest AGI if residency is not determinative between parents, and (iii) to the taxpayer with the highest AGI if all claimants are non-parents. Finally, the legislation continues to allow divorced or separated spouses to assign the dependency exemption and the child tax credit to non-custodial parents provided that certain support and residency tests are met. Simplification of the tax code should be more than just rhetoric. It is time for us to put legislation behind our words. We intend to continue to look at other areas of the tax code in need of simplification. Senator Grassley and I also want to thank our Finance Committee colleagues, Senators Hatch, Thomas and Lincoln, for their support of the Uniform Definition of Child Act of 2003. Simplification of the tax laws for the families of our nation is not partisan, it is not political, it is simply common sense. Mr. President, I ask unanimous consent that the Uniform Definition of Child Act of 2003 be printed in the Record.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, when the space program began in 1959 there were only seven astronauts in the entire country. They all were or had been in the Armed Forces. That was only 44 years ago and since then, much has changed. Today, astronauts are comprised of Americans from every race, creed, color and gender. While many still come from the military, the astronaut corps now includes civilian doctors, scientists, and engineers. They are our best and our brightest. They risk their lives to advance our knowledge and understanding of the world. On February 1, 2003, seven men and women aboard the space shuttle Columbia lost their lives. LTC Michael P. Anderson, U.S. Navy CAPT David Brown, U.S. Navy CDR Laurel Clark, Dr. Kalpana Chawla, U.S. Air Force COL Rick Husband, Naval CDR William McCool, and Israeli Air Force COL Ilan Ramon will be remembered forever. Five of the six Columbia crew members, from the United States, had military backgrounds. They were national heroes who are deeply missed by their family and friends. Through their dedication to space exploration, they lived their lives to the fullest and made long lasting contributions. In honor of their sacrifice, I along with 13 of my Senate colleagues, introduced S. 298, the Assistance for Families of Space Shuttle Columbia Heroes Act. I am pleased that the legislation was included by the Senate Finance Committee as part of the Armed Forces Tax Fairness Act of 2003. Under the legislation, the families of the Columbia heroes would receive the same benefits as families of military personnel who die in the line of duty. The provisions are similar to legislation passed in 2001 that provided relief to victims of the September 11, anthrax and the Oklahoma City attacks. Specifically, the bill expands the class of those eligible for these benefits to include astronauts killed in the line of duty. The legislation provides income tax relief. Current law generally excludes from tax income received in the year of death or in a previous year for soldiers killed in combat zones, and victims of September 11, anthrax and Oklahoma City. The legislation expands this benefit to apply to astronauts who die in the line of duty. The legislation provides death benefit relief. Current law excludes from income any death benefit paid by the U.S. Government to a soldier killed in a combat zone or paid by an employer to the families of the victims of September 11, the anthrax attacks, or the Oklahoma City bombing. The legislation expands this benefit to apply to death benefits paid to the families of astronauts killed in the line of duty. The legislation provides for estate tax relief. Current law provides estate tax relief that effectively lowers the estate tax rate to 20 percent for the estates of soldiers killed in combat zones, the victims of September 11, the anthrax attacks or the Oklahoma City bombing. The legislation expands this benefit to apply to the estates of any astronaut killed in the line of duty. The best way to honor Columbia's fallen heroes is to promptly pass this legislation and pledge that the goals and missions of NASA will live on in the years to come. I urge my colleagues to support the Armed Forces Tax Fairness Act of 2003 which includes tax relief for the families of the Space Shuttle Columbia heroes. Mr. President, since September 11, significant progress has been made to disrupt and dismantle the financial components of terrorist organizations. Special agents from the IRS and other law enforcement agencies have successfully investigated numerous terrorist related entities-- including tax exempt organizations that have engaged in terrorist fundraising. The Armed Forces Tax Fairness Act of 2003 contains a provision that would suspend the tax-exempt status of any organization designated by U.S. authorities as a terrorist organization or supporter of terrorism. There is no procedure under present law for the IRS to suspend the tax-exempt status of an organization. The IRS can revoke an organization's tax-exempt status only after conducting an examination of the organization. Even then, the IRS must issue a letter proposing revocation and allow the organization to exhaust its administrative appeals rights. The provision in this legislation is simply common sense. It is an important weapon in our war on terrorist financing. An organization that has been designated by the Federal Government as a terrorist organization should not be exempt from Federal income tax. Moreover, contributions to such organizations should not be tax deductible. Once the Federal Government determines that an entity is a terrorist organization pursuant to certain authority--for example, the International Emergency Economic Powers Act--a separate investigation by the IRS is not necessary. Further, because a terrorist organization may challenge the Federal government's designation under the law authorizing the designation, recourse to the declaratory judgment procedures of the Tax Code is not appropriate. If a tax-exempt organization's suspension is determined to be erroneous, the provision would allow tax refunds for any overpayments. Lastly, the IRS will be required to update its listings of tax-exempt organizations to take into account organizations that have had their exemption suspended. This will give notice to taxpayers that contributions to these organizations are no longer deductible. I urge my colleagues to support the Armed Forces Tax Fairness Act of 2003. Mr. President, this bill includes many important changes in the tax treatment of income and benefits received by members of our armed forces. One provision is particularly important for members that face the dual challenge of serving their nation while raising a family. The bill explicitly states that child care subsidies that members of the military receive shall not be subject to income tax. In 1986, we passed a law which stated that military benefits should not be included in income for tax purposes. The statute lists a number of benefits received by members of the military-- housing allowances, medical benefits, education assistance, and many others. But child care subsidies do not appear on the list. When we passed this law, the Department of Defense did have a program to assist members of the military in caring for their children. But the importance of this program has increased as the demographics of the members of the military have changed. There was a time when our forces were primarily young single men. However, times have changed. Twelve percent of the forces are women. Over half of the active duty members are married. Two-thirds of military spouses work outside the home. Six percent of members are married to another member of the military. And 6 percent are single parents. Young single soldiers are no longer the norm. Recognizing these changes, the Department of Defense has placed a reinforced importance on assisting military families. The Department of Defense recognizes the additional challenges faced by military families as they raise children. The average military family moves every two and a half years, making it difficult for them to find quality child care, or friends and neighbors to look to for help with child care responsibilities. And with work schedules that are often long and unpredictable, help is often necessary. In addition, members of the military face the possibility of deployment anywhere in the world at any time. They now operate over 800 child care centers in the U.S. and abroad. These include child development centers for young children, after- school centers for older children, and other family care programs. They provide night and weekend services as well, to accommodate the often hectic schedules that military families face. All in all, these programs provide care for over 200,000 children every day. The cost of these programs varies depending on the income of the parents--on average, it is about $7,700 per child. This cost is shared by the military parents and the government, with each paying about half the cost. The law is unclear about whether these benefits are subject to income tax. A provision in this bill ends that confusion. It states that these child care subsidies, shall not be included in income, for tax purposes. As the demographics of the members of the military have changed, so has the policy of the Department of Defense. Now it is time that we follow with these changes to the tax code. I compliment Senator Landrieu of Louisiana, who developed this proposal, and insisted on its inclusion in this military tax bill. It is one more reason the Senate should pass this legislation today. I yield the floor.

Mr. BAUCUS. I suggest the absence of a quorum.

Mr. BAUCUS. Mr. President, that is a very important statement and request that the Senator from Arkansas has made. I can speak on behalf of myself, and I am sure Senator Grassley, that we would be more than honored to join with the Senator from Arkansas in making that request. It is a very timely request. It is one that is very important. Frankly, I am a little bit surprised none of us made that same request that he has made because it is so important, and it is going to give us a lot better idea of the financial condition of our armed services. It is a good idea.

Mr. BAUCUS. Mr. President, thousands of men and women from Montana are currently stationed overseas, be it in Iraq, Afghanistan, South Korea, Southeast Asia or in other supporting missions throughout the United States and the rest of the world. These brave and dedicated soldiers have chosen to join the Armed Forces and protect our country, which is one of the highest forms of service there is. They are putting their lives on the line to protect the freedom and security of the United States. I take my hat off to them. To date, Montana has sent almost 700 Reserve forces into Active Duty. Malmstrom Air Force Base has 105 airmen deployed overseas, including 50 members of the 819th Red Horse Squadron. Earlier this month 114 members of the Red Horse Squadron came home after being deployed in southwest Asia for five and a half months. The airmen are supporting six different operations around the world in southwest Asia, supporting no- fly zones in Iraq or in Afghanistan. About 390 Army Reservists from Montana have been deployed. From Great Falls, the 889th Quartermaster Company unit--with 119 members--recently received mobilization orders along with 100 members of the 4225th U.S. Army Hospital. From Missoula, 58 soldiers from the 279th Engineer Battalion and 16 soldiers from the 823rd Transportation Detachment have been activated. And out of Billings, 161 members of the 592nd Ordnance Company recently received their orders. Most of these army Reservists will take part in Operation Enduring Freedom. Montana's Air National Guard has also contributed significant human resources. 210 members of the 120th Fighter Wind have been activated flying in the no-fly zone over Iraq. Montana's Army National Guard has contributed about 125 Army Guard members, many of which are at other bases throughout the United States taking part in Homeland Security measures. Thirty-five members of the 443rd Petroleum, Oil and Lubricants Supply Company have been mobilized to assist with base security at the 120th Fighter Wing unit on Gore Hill outside of Great Falls, MT. Forty-five soldiers from the 495th Transportation Battalion are taking part in Operation Enduring Freedom. Eight ground- air liaison teams are in Fort Sill, OK, and 2 UH60 Helicopter pilots are in Fort Benning, GA. Most certainly, I do not want to forget the thousands of Active Duty Army, Navy, Air Force and Marines from Montana stationed elsewhere throughout the Nation and overseas. These soldiers are sons and daughters, brothers and sisters, fathers and mothers. And like you and I, they have families to take care of and worry about. They have personal lives to attend to, bills to pay and tax forms to fill out. As they are stationed far away, they are worried about how their children are doing in school and how their husbands or wives are coping with the distance. It is not easy. Every day they are putting their lives back here on hold and instead putting their lives on the line to protect the rights we hold so dear. With all of the worries they are facing, I am urging for passage of the military tax bill so we can take one, or two, burden off of their minds. These men and women should not have to worry about whether or not their deployment changes their residency for tax purposes. They should not have to worry about whether or not they can afford their weekend training, nor should they ever have to worry about whether their death could result in an undue tax burden to their family. One of the best ways we can support our troops is by doing everything we can to ensure that they and their families are taken care of. As a tribute to our Armed Forces, I cannot think of a better way to support them than by passing the military tax bill and allowing them to focus on their mission rather than their finances. I encourage my colleagues to show their support for our troops today by voting in favor of the Armed Forces Tax Fairness Act.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, this is a time to honor our men and women fighting for us overseas. I am here honoring PFC Stryder Stoutenburg from Missoula, MT, who died in the current conflict. Each of my colleagues knows personnel who have died in Iraq. We honor them. We grieve for their families. We are working hard to give the best benefits we can for them. This bill is not going to heal wounds. It is not going to bring people back. It is not going to bring our loved ones back home right away. It is a small token of something we can do in honor of the men and women, mothers and fathers, brothers and sisters who are fighting for America. I strongly urge us to give a resounding vote in favor of the men and women, this small token, to help them. It shows we care. I urge a very strong vote.