Max Baucus

Mr. BAUCUS

Mr. BAUCUS. Madam President, I rise today to introduce the Rural Spectrum Access Act, RESA, of 2002. Wireless communications is revolutionizing the way we communicate. It allows us to place calls from anywhere in the world to anywhere in the world. We can check our favorite websites, and even stay in touch with family and friends through email, all without a phone line. It's empowering to know that we can do all this and more while sitting on top of a mountain in Montana. However, these services require spectrum, the wireless waves that give us this freedom. Due to the way the FCC distributes spectrum, rural America is finding it more and more difficult to get quality wireless service. The current system distributes spectrum on very large geographic areas, which in effect, inhibits certain carriers from participating in wireless auctions. Since the geographic licensing areas are so large and the price for the spectrum is equally as large, rural carriers often find it difficult bidding on the spectrum. My legislation will correct this inequity. RESA requires the Federal Communications Commission, in future auctions, to distribute spectrum on smaller geographic levels. It does not favor one type of carrier over another, or pick which carrier can serve which areas. Rather, it simply allows carriers to bid on spectrum that they find difficult under today's system. It is my hope that this bill will allow more of our rural telecommunication carriers to participate in future auctions. The RESA Act will bring more choices, better service and lower prices for those of us living in rural America.

Mr. BAUCUS

Mr. BAUCUS. Madam President, I rise today to introduce the Rural Spectrum Access Act, RESA, of 2002. Wireless communications is revolutionizing the way we communicate. It allows us to place calls from anywhere in the world to anywhere in the world. We can check our favorite websites, and even stay in touch with family and friends through email, all without a phone line. It's empowering to know that we can do all this and more while sitting on top of a mountain in Montana. However, these services require spectrum, the wireless waves that give us this freedom. Due to the way the FCC distributes spectrum, rural America is finding it more and more difficult to get quality wireless service. The current system distributes spectrum on very large geographic areas, which in effect, inhibits certain carriers from participating in wireless auctions. Since the geographic licensing areas are so large and the price for the spectrum is equally as large, rural carriers often find it difficult bidding on the spectrum. My legislation will correct this inequity. RESA requires the Federal Communications Commission, in future auctions, to distribute spectrum on smaller geographic levels. It does not favor one type of carrier over another, or pick which carrier can serve which areas. Rather, it simply allows carriers to bid on spectrum that they find difficult under today's system. It is my hope that this bill will allow more of our rural telecommunication carriers to participate in future auctions. The RESA Act will bring more choices, better service and lower prices for those of us living in rural America.

Mr. BAUCUS

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

Mr. BAUCUS

Mr. BAUCUS. Mr. President, at the end of the last session of Congress the Finance Committee reported three critical pieces of international trade legislation to the Senate calendar: An expansion of the Trade Adjustment Assistance Act, an extension of fast track trade negotiating authority, and an expansion of the Andean Trade Benefits program. Each of these bills is time-sensitive and I believe that the Senate should take action on them as soon as possible. The Trade Adjustment Assistance Act, or TAA, first established in 1962, is the program that addresses the needs of workers and firms that are adversely impacted by trade. The Senate Finance Committee bill expands TAA coverage to new groups of workers, including farmers and secondary workers; provides training and healthcare benefits to recipients; and experiments with a new concept of wage insurance, which aims to move the unemployed back into the labor force as quickly as possible. Unfortunately, TAA was allowed to expire at the end of the last Congress. We need to not only extend TAA, but complete the expansion as soon as it is practical. Although States have cooperated with the efforts of the Department of Labor to keep the program in operation, this stopgap cannot continue indefinitely. Congress must ensure that this critical safety net for working Americans is in place. The extension of fast-track trade negotiating authority--sometimes called trade promotion authority--is also pending on the Senate calendar. This measure is controversial, but Senator Grassley and I were able to arrive at a bipartisan bill to extend fast track. And the bill passed the Finance Committee 18-3 with the support of both the majority leader and the minority leader. This extension may not be as urgent as the extension of TAA, but many important international trade negotiations both bilaterally and multilaterally are pending or underway. This bill allows Congress to direct these negotiations and allows the President to credibly negotiate with our trading partners. It is time for Congress to extend fast track. The Senate Finance Committee also reported an extension of the Andean Trade Promotion Act or ATPA. This measure has been actively supported by many Senators, including Senator Bob Graham and the distinguished majority leader. The legislation aims to shore up support among U.S. allies in the critical Andean region and provide an alternative to the illegal drug trade to citizens in the region. In addition, another critical international trade program, the Generalized System of Preferences, which provides important benefits to many developing countries, also expired at the end of the last Congress. This program should also be extended for some reasonable period of time, in my opinion, several years. I have discussed with the majority leader and many of my colleagues combining all of these bills into a single vehicle, winning Senate passage for the legislation, and quickly moving to gain support for the legislation in the other body in the hopes that these measures might be signed into law as soon as possible. The combined trade legislation has some detractors, but each component of the proposed trade legislation has bipartisan support. Each piece serves an important public policy purpose. And each piece is timely, if not overdue. I know that the Senate calendar is crowded, but I would like to urge the majority leader and the minority leader to work with Senator Grassley and myself to find time to take this legislation up shortly after the Senate returns from the coming recess.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, this bill that has come over from the House has come over quite quickly and Senators have not had a lot of time to examine it and to work through the provisions of the bill. Personally, I think it is a bit rushed. Having said that, I will support it at this point because--the phrase I often find myself using these days--we cannot let perfection be the enemy of good. There are some good provisions in this bill. We did not have the opportunity to amend it. But the fact is, if we do try to amend it, we will probably get wrapped around the axle, and nothing will be passed. And there are several provisions that should definitely pass. One is the extension of unemployment insurance. To my mind, the provisions in the House bill relating to unemployment insurance do not do enough. Given the state of the economy in the last year and the number of people who are out of jobs and need help, it is unfortunate that we cannot do more. But a 13 week extension will help many people and provide an economic stimulus. In addition, the bill includes the extension of several important tax provisions, some of which expired last year. It is an outrage, frankly, that this Senate and the House of Representatives let those provisions lapse and we did not pass them at the end of last year. I tell my colleagues right now that I regret I did not push strongly enough last year when we passed the tax bill to make sure the extenders were included. I had an assurance that they would come up soon. But that is no way to run a railroad. It is no way for the country to run its business, to say it is OK to have an on-again/off-again policy with respect to tax law. I tell my colleagues the next time this comes up, we are going to pass extenders so that the provisions remain continuous. It will be a seamless web. There will never be another time when extenders are not passed, if I have anything to do with it. Unfortunately, there are not any health provisions in this bill. There should be. A lot of people lost their health insurance benefits as a consequence of lost jobs and as a consequence of the declining economy. As you well know, more and more people are without health insurance. It is because companies are not providing health insurance, and people are laid off and can't keep their health insurance. It is a huge cost individually to the people involved, and it is a huge cost to the country. It is regrettable that this provision we are passing today does not include health insurance benefits for those people who lost their health insurance on account of lost jobs. That is too bad. I wish it were in the bill, but it is not. The bonus depreciation provision is good. It is going to help create jobs, and it will help stimulate the economy a bit. I note, as we all note, that Chairman Greenspan said we are turning the corner. I think he is probably right. But the bonus depreciation provision is going to help. It also is insurance, and that is going to help as well. The long and short of it is we have a choice. It is either vote for this, or try to amend it. If we try to amend it, we will be back where we have been for the last 5 months; that is, doing a lot of talk and not much action. I regret that. But that is the situation with which we are faced. In light of this situation, I urge my colleagues to pass this. It is going to help-- particularly the provisions that I mentioned--and we will get on with health insurance and get on with the other provisions that need to be taken up later on this year. When they come up, I urge my colleagues to work with us to be sure that they are enacted because there are a lot of people hurting and who need a lot of help. I thank my good friend from Nevada. I yield the remainder of my time.

Mr. BAUCUS

Mr. BAUCUS. In 1993, the United States Court of Appeals for the Ninth Circuit held in Transamerica Corporation v U.S. that, for purposes of the income forecast depreciation method, the anticipated cost of participations and residuals should be included in a property's cost basis at the beginning of the property's depreciable life. As the Ninth Circuit determined in Transamerica, inclusion of participations and residuals in a property's initial cost basis is necessary to properly match the income and expenses associated with the property and to clearly reflect income. Yet, it is my understanding that the IRS is not currently permitting such treatment. To eliminate the current uncertainty, Senator Grassley and I have encouraged Treasury to consider regulations clarifying that participations and residuals may be included in a property's initial cost basis for purposes of the income forecast method of depreciation.

Mr. BAUCUS

Mr. BAUCUS. I would agree that the relevant footnote merely restates the Internal Revenue Service's present authority, and is not intended to limit that authority in cases where modification of an approval is sought, and such a modification would be consistent with the government's overall response to September 11.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, the Job Creation and Worker Assistance Act of 2002 contains a package of technical corrections to EGTRRA, the tax cut bill we enacted last year. Among these technical corrections is a provision that corrects an unintended drafting error that prevented increased contributions to Simplified Employer Pension plans--also known as SEPs. Congress raised the percentage of compensation limit on all defined contribution plans, but the drafters failed to make the conforming change that would also have raised the percentage of compensation limit on SEP plans by an equal amount. Clearly, we intended to include SEP plans when we raised the compensation limit for defined contribution plans. As a result, this technical correction is entirely appropriate. There is no doubt this Congress intended for employers who sponsor SEPs for their workers to be able to contribute the maximum annual amount that we authorized under the law. However, we also intend that SEP plans comply with the law just as all other pension plans must. The Treasury Department has authority under existing law--Internal Revenue Code Section 408(l)(1)--to impose reporting requirements on SEPs. However, such requirements have not yet been implemented through any regulation. The Internal Revenue Service has indicated many SEP plan sponsors may not be in compliance with rules that require SEP plan contributions be provided to rank-and-file employees along with owners and key employees. Much of this noncompliance may well be the result of the absence of reporting requirements. The tax subsidy for SEP plans is a substantial one, and under the provisions of EGTRRA and this technical correction, that subsidy will grow significantly. Had this tax package gone through the usual legislative procedure-- including a conference from which a conference report containing legislative history would have emerged--it would have included committee report language urging the Treasury Department to exercise their existing statutory authority under IRC Section 408(l)(1) to impose reporting requirements on SEPs. In the absence of such a committee report, I urge the Treasury Department to act expeditiously to issue clear, simple SEP reporting requirements so that Congress can be confident that those working for SEP plan sponsors are getting all the pension benefits to which they are entitled.

Mr. BAUCUS

Mr. BAUCUS. It is our intention to cover all types of aircraft, including commercial, chartered, privately-owned, or crop-dusting aircraft, to the extent the aircraft is otherwise eligible for depreciation.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I commend the Senator from Minnesota for his hard work on behalf of U.S. dairy farmers. This bill, however, properly falls under the jurisdiction of the Senate Finance Committee. As chair of the finance Committee, I will work with the Senator from Minnesota to bring the issue to the attention of the Finance Committee members and to find an appropriate legislative vehicle for his proposal this session.

Mr. BAUCUS

Mr. BAUCUS. Madam President, we have a little time, so we can have a little more debate. Farmers across America strongly support additional aid to our military to protect our national security. That is a given. It is absolute, automatic. But there are also farmers who have suffered tremendous losses. I ask my good friend from Indiana to visit, at least Montana and he will see thousands of square miles of dust. That is a disaster. There are no combines, nothing. I have walked through those fields. It happens in other parts of the country, too, whether it is from storms or floods or pest diseases. The Senator's problem is with the farm bill; it is not with disaster assistance payments. We are now focused and voting on a disaster assistance payment. That is entirely separate from the farm bill. So I urge my colleagues to step up and do what is right and support the farmers who are facing these emergencies. I tell you, they are in dire circumstances. We are losing people in our State of Montana. We are a special State, granted. We do not have a lot of other industries. But other farmers in other States are also facing the same problems, but sometimes from different kinds of disasters, not necessarily always from a drought. I must say to my good friend, 50, 75, 80 percent of the States in this country are suffering from a drought, let alone other disasters. I urge my colleagues to just give farmers a chance. If they have a problem with the farm bill, then they should offer amendments to the farm bill, not the disaster assistance program.

Mr. BAUCUS. Mr. President, people can always use figures. It is true that over the entire period of the farm bill that number of dollars has been spent. It is also true that some disaster assistance has been provided to farmers in the past. But it is not true that we spent $11 billion this prior year on disasters. Frankly, the last payment was only $5 billion, and it was not disaster payments; it was supplemental payments because Freedom to Farm was failing. This is the first time it applies only to 2001. It would be disaster assistance to farmers who suffered disasters in 2001. It is only fair. It is only appropriate. I might add, there is an $80,000 payment limitation--you can't get disaster payments of more than $80,000--which is very low, I might add, compared to a lot of disasters that occurred across our country. It is only disasters, and very small in comparison to the problems we have been facing. I urge Senators to support the amendment.

Mr. BAUCUS. Mr. President, pursuant to section 904 of the Congressional Budget Act of 1974, I move to waive the applicable sections of that act for the purposes of the pending amendment, and I ask for the yeas and nays.

Mr. BAUCUS. Madam President, I ask unanimous consent the order for the quorum call be dispensed with.

Mr. BAUCUS. Madam President, I rise today to again discuss an amendment that would provide desperately needed disaster assistance for America's farmers and ranchers. I would like to begin by thanking my colleagues, Senators Enzi, Reid, Burns, Landrieu, Dorgan, Johnson, Conrad, Carnahan, Dayton, Stabenow, Lincoln, Levin, Murray, and Cantwell, for cosponsoring this measure. This amendment extends to the 2001 crop the same agricultural disaster programs that have proven crucial to American farmers in recent years. The amendment provides $1.8 billion for the Crop Disaster Program and is intended to cover quality loss due to army worms, $500 million to the Livestock Assistance Program, with $12 million directed to the Native American Livestock Feed Program and $100 million toward the apple market loss assistance program. Agricultural producers desperately need these disaster programs. Adverse weather conditions have pushed farmers, ranchers, and rural communities to the brink of economic disaster. These adverse weather conditions came on the heels of sharply escalating operating costs due to higher energy and fertilizer prices. With weather problems continuing, costs rising, and no time to recover from the drop in farm operating income, it is incumbent on us to take action today. President Bush understands the crucial role that agriculture plays in America's economy. In a speech delivered to the National Cattlemen's Beef Association's Annual Convention and Trade Show in Denver, He said: Our farm economy, our ranchers and farmers provide an incredible part of the nation's economic vitality. If the agricultural economy is not vital, the nation's economy will suffer.'' We must give rural America the chance to have a vital economy. Closer to home, farmers in my State of Montana have compared current drought conditions to the dust bowl years of the 1930s. Many have not taken out their combine in over a year. When there is no harvest, there is no income. And the strain on these rural communities is beginning to mount. According to Dale Schuler, past president of Montana Grain Growers and a farmer in Choteau County, Montana, nearly 2,000 square miles of crop in his area of central Montana have gone unharvested. That is an area the size of Delaware. And the impact has been horrendous. To quote Mr. Schuler: Farmers and our families haven't had the means to repay our operating loans, let alone buy inputs to plant the crop for the coming year. I believe that we're set to see a mass exodus from Montana not seen since the Great Depression of the 1930s. Chouteau County, the largest farming county in Montana, the last farm equipment dealer had no choice but to close his doors, the local co-op closed its tire shop, one farm fuel supplier quit, and the fertilizer dealers and grain elevators are laying off workers. Another farmer from the area, Darin Arganbright, told me that enrollment in local schools has decreased by 50 percent in the past few years. So we are not only losing our current farmers but our future farmers. A final point. We need to act now--on the farm bill. Producers are making their planting decisions for next year right now. But, without these disaster payments, many banks will refuse to provide operating loans to producers for this upcoming crop year. In Montana, it is anticipated that 40 percent of producers seeking operating loans this year will be denied if we fail to provide this assistance. Without these loans, many farmers will simply be unable to plant, giving up any hope of economic recovery in the near future. This would devastate my State's economy and that of the West. Rural America needs a boost. And I believe our amendment does just that. This measure will provide stimulus our rural communities need to survive by extending the disaster relief programs that have been critical to shoring up farm income over the last 3 years. This relief will allow farmers--and the rural communities that depend upon them--to get back on their feet. In conclusion, I would like to note that the letters of support for this amendment continue to pour in. These include: The National Association of Wheat Growers; the National Cattlemen's Beef Association; the National Farmers Union; the National Cotton Council; the American Farm Bureau; the United Stockgrowers of America; the National Barley Growers Association; the U.S. Canola Association; the American Soybean Association; the National Sunflower Association; and the Northwest Farm Credit Services. Our Nation depends on agricultural producers for an abundant, affordable, safe food supply. Today our Nation's producers depend on us to provide them with much needed and overdue assistance. Let's get the job done. I reserve the remainder of my time.

Mr. BAUCUS. Madam President, I would like to say a couple of words with respect to my friend from Arizona saying that he is not going to vote for $2.4 billion because $5 billion was already spent for emergencies. A couple of points: Implied in his remarks was that we should support emergencies. He mentioned terrorism. He didn't mention al-Qaida, but he implied it. That is correct. We have an emergency. We need additional national security dollars to confront that emergency. I say to my good friend that we have another emergency. The emergency is the drought. It is crop losses due to weather conditions. It is an emergency. You can't predict it. It happens. The $5 billion my good friend referred to is in every category. That was added on because farmers are losing their shirts under ``freedom to fail.'' That had nothing to do with disaster or weather conditions. It had nothing to do with an emergency, a national security emergency, or a weather-related agricultural emergency. We need to take care of and support people who are adversely affected by emergencies. Madam President, I reserve the remainder of my time.

Mr. BAUCUS

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

Mr. BAUCUS. Mr. President, this amendment will help farmers who have experienced very deep, strong disasters due to weather conditions. It provides desperately needed disaster assistance for America's farmers and ranchers. I begin by thanking Senators Enzi, Reid, Burns, Landrieu, Dorgan, Johnson, Conrad, Carnahan, Dayton, Stabenow, and Lincoln for cosponsoring this. I also thank the 57 Senators who voted in support of this measure when we tried to append it to the stimulus package a couple weeks ago. We came very close to passing this amendment. Unfortunately, 10 of our colleagues were not present for the vote, and given the strong showing of bipartisan support and the likelihood that I think more than 60 Senators support this measure, it is vital that we try again with more Senators present. The amendment extends to the 2001 crop the same agricultural disaster programs that have proven crucial to American farmers in recent years. What could be more obvious and commonsense than to extend to the 2001 crop the same programs that have proven crucial to American farmers in recent years? The amendment provides $1.8 billion for crop disaster program and covers quality loss due to army worms. It provides $500 million to the livestock assistance program, with $12 million directed to the Native American livestock feed program. It also addresses the concerns of our apple producers and provides $100 million toward their market loss assistance program. Producers desperately need these disaster programs. They need them to help mitigate the devastating effects of an unprecedented streak of poor weather throughout the United States. Mr. President, I know you will remember when you came to Montana, I think in the 1980s, how bad that drought was, walking out in the fields, virtual dust, with no crops. That was, I think, in the late 1980s. I must tell you, regrettably, I was thinking about that trip you and I, Senator John Melcher, and others took to Montana earlier this year when I was in an area a little way from where we were, with the same conditions--dust, no crops. In about a 200-square-mile area nothing was combined. This chart basically indicates the drought impact in the United States. The red, as you can see, are areas of our country already declared disaster because of drought. The green patches you can see here are areas that are recovering from drought. They are obviously not out of the woods. They have been in a drought situation. The yellow represents drought watch areas. That means close to being declared a drought area. That is an area qualifying for disaster assistance. On the map, essentially all of the United States down around the Mississippi River is either in drought conditions or drought watch conditions. I don't know whether it is climate change that is causing this or global warming. All I know is that very strange weather conditions are hurting farmers and ranchers. It is our job to do what we can to be sure they are made whole. These weather conditions could not have happened at a worse time. While struggling to survive 3 disastrous years in agriculture, farmers also have faced sharply escalating operating costs. Just think of it. The drought hits, operating costs go up--high operating costs due to high energy and fertilizer prices--income is not doing too well, and farm debt is increasing. A couple words about farm expenses. Total farm expenses were estimated to rise another $4.5 billion in 2001. That is after the rise of nearly $10 billion in the preceding year. Farm debt has been rising in the last 3 years, after recovering from the crisis in the mid-1980s. We just talked about the late 1980s, and now farmers are borrowing as much or higher, and that adds to their operating costs. Statistics kept by USDA's Economic Research Service demonstrate that net farm business income was at a decade low in 1999 and in 2000. Thanks to a limited recovery in income last year--very slight--which means that unless Government assistance continues, net farm income in 2001 is projected to be lower than farm income in 1999 or 2000. Thus, if our efforts are curtailed, if weather problems continue, costs rise, and there is no time to recover from the contraction of farm operating income since 1998, the impact on rural America will be devastating. You might ask: Why now? Why this amendment on the farm bill? Basically, simply, because the clock is ticking. People need help now. They can't wait. Farmers in economic distress are not able to make the usual purchases of seed or fertilizer now, not to mention--I don't want to overdramatize this--in some cases, plain old food and clothing. Equipment and tractor dealers close their doors, as do rural schools and local merchants, which makes the agricultural sector--which is directly and indirectly responsible for nearly one-fifth of the U.S. gross domestic product--among the worst affected areas in the United States and the most vulnerable sectors of the U.S. economy. Our amendment extends the disaster relief programs that have been critical to shoring up farm income over the last 3 years. This relief will allow farmers--and rural economies that depend on them--to get back on their feet. I want to address several issues that were raised when we last debated this issue. First, some worried that these payments would go to millionaire farmers. Why should this agricultural disaster assistance, they say, go to millionaire farmers? I might say that charge is totally inaccurate, unfounded, and probably misunderstood. The crop disaster benefits under this amendment are limited to $80,000 per person and no one with an annual gross income of $2.5 million or more is eligible. That is, if your gross income is $2.5 million or more, you don't qualify. That sounds like a lot of money, but that is gross income, not net income. Most farmers have no net income. If you take the gross and subtract out the costs, whether it is debt service or expenses, or whatever else it might be, the net income for most farmers is negligible--if there is income at all. Second, some Senators believed these disasters were already covered under the crop insurance program. Let me be clear: I support Federal crop insurance. I think most Senators do. However, Federal crop insurance only covers a small percentage of farmers, as well as only a fraction of their losses. That is due to adverse weather conditions in 2001. To quote the president of the National Association of Wheat Growers, Gary Broyles: Current crop insurance only covers up to 57 percent of a farmer's loss, but farmers do not operate with a 25 percent profit margin, especially in areas that have had multiple years of weather-related problems. In addition, other sectors in the agricultural industry such as specialty crops and livestock are not eligible for Federal crop insurance. For them, their losses are really real. They particularly need help. If producers have crops that qualify in the Government programs, I would think livestock and other specialty crops in agriculture should also qualify. On a related note, farmers who do receive assistance under this program are required to obtain crop insurance on their next crop if it is available. One final point. Producers are now making planting decisions for next year. Without these disaster payments, I have to say--and I hear this constantly--many banks will refuse to provide operating loans. They will refuse to extend the credit that farmers need to try planting for another year. Without these loans, many farmers will be unable to plant, it is that simple, which is giving up any hope of economic recovery in the near future. This hits pretty close to home. In my State of Montana, it is anticipated 40 percent of producers seeking operating loans this year will be denied; that is, denied if we fail to provide this assistance under this amendment. It is that timely. It is that significant. Of course, that is going to very much hurt the agricultural economy with individual farmers. In conclusion, I have many letters of support for this amendment. They literally continue to pour in. They include the National Association of Wheat Growers, the National Cattlemen's Beef Association, the National Farmers Union, the National Cotton Council, the American Farm Bureau, the United Stockgrowers of America, the National Barley Growers Association, the U.S. Canola Association, American Soybean Association, the National Sunflower Association, the Northwest Farm Credit Services, and others. Today we have another chance to help these farmers get back on their feet. If we cannot make it rain, we can make a difference. I urge my colleagues to support this amendment to provide the disaster assistance so many in American agriculture need given these whacky weather conditions we are experiencing this year which is hurting American agriculture. I yield the floor, and I suggest the absence of a quorum.

Mr. BAUCUS. Mr. President, I send an amendment to the desk.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, for the past 6 months Congress has been discussing the best ways to stimulate the economy. Even though we are no longer working on an economic stimulus bill, we face a real crisis that will negatively affect our economy. We face unprecedented losses to our highway program. Every state will lose money. If we want to create true stimulus and maintain jobs for our citizens then there is an easy solution. Highways. For every $1 billion dollars that goes into the highway program, 42,000 jobs are created. In an attempt to address unemployment concerns and immediate stimulus to the country's economy, I, along with others on the Environment and Public Works Committee, propose an increase in obligation authority for the fiscal year 2003. This would restore the authorized levels for that fiscal year. It doesn't get us all the way there, but it's a start. This is about jobs. Skilled and unskilled jobs in highway construction are well-paid. These jobs would provide employment opportunities for workers who have lost manufacturing jobs, with minimal training requirements. In addition current jobs will not be lost in many of the supplier and heavy equipment manufacturing industries. This is money that can be spent quickly by state DOTs. Fast spending means fast jobs. Both state DOTs and contractors confirm that money can be spent and jobs maintained within the first 6 months. Without restoring TEA 21 levels, over 360,000 jobs will be lost. There is $20.5 billion in the Highway Trust Fund. We can afford at least the $4.369 billion from that balance to be distributed over the next year. In fact, we can't afford not to. This extra $4.369 billion begins to take care of this huge problem that we face. It is a problem that we addressed the other day in the Environment and Public Works Committee hearing on TEA 21 reauthorization. We are looking at a highway program that is $9 billion lower for FY 2003 than it was in FY 2002. For my state of Montana that means a $79 million loss to our highway program. And in Montana, highways are our lifeblood. We need the highways and we need the jobs created from new highway funding. Also, we can't afford to lose any highway-related jobs because of this under funding. We passed a six year highway bill for a reason. So states knew how much was coming in from year to year. My State Department of Transportation is counting on at least the TEA 21 level. Secretary of Transportation Norman Mineta was at that hearing I just mentioned. And when I pressed him about this extra obligation authority for highways, his response was that highway money is good economic stimulus. In conclusion, I propose that we give States at least what they were expecting for highway projects in fiscal year 2003. They say there is no such thing as an easy fix, but let me tell you--this idea comes as close as any.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I do not know if there are any Senators who wish to debate the current amendment. At the appropriate time, I will ask the Senator from Iowa to acknowledge there is no more debate so we can set aside his amendment and go to the regular order. The Senator raises a very important point that in the last 2 years, States' economies have generally deteriorated. As a consequence, there is more pressure on their Medicaid budgets. States are losing revenue. States are moving more toward deficit positions. They are not as healthy as they once were. When States begin to cut spending and cut services, there is a tendency to cut back a bit on Medicaid programs to balance the State budgets. The Senator is proposing a significant percentage increase in the matches the Federal Government make to States under Medicaid to make up that difference. That so-called difference, the drop, occurs for a second reason. We have very old data. The reimbursement to States under Medicaid is based on data up through the year 2000. States were doing pretty well in 1999 and 2000. So there is a tendency for the reimbursement rate to be out of whack, out of sync with the current fiscal situation of the States; namely, tougher times, deteriorating surpluses, sometimes potential deficits. The amendment offered by the Senator from Iowa attempts to address that point. One might question whether the amendment is too rich or not rich enough. It is a question of degree. He essentially wants to add 3 percent to all States' match and an extra 1.5 percent for States with particularly high unemployment. That is an approach I also took in an amendment I will be offering later today. Although the approach is the same, the total percentage amount is not quite as high. The percentages in the amendment I will be offering later hold States harmless. The percentages offered by the Senator from Iowa, it is my understanding, in the first year go slightly higher for well-intended reasons. I am not going to pass judgment on whether that is a good idea or not, but that is the practical effect of that amendment. I do not see anybody else wanting to speak on this amendment. The Senator might want to speak some more. Maybe he does not want to speak some more. If not, I ask unanimous consent that, whatever the appropriate order, the amendment be set aside and voted on at the appropriate time and that the pending business be the regular order.

Mr. BAUCUS

Mr. BAUCUS. Mr. President, the Senator from Nevada, Mr. Reid, is organizing the sequence of amendments. I think it is fine for the Senator from New Hampshire to offer his package of amendments with the understanding they come up one at a time, and if there is an amendment on this side in the interim, that amendment would be offered and we would go back to one of Senator Smith's amendments. That is fine.

Mr. BAUCUS. I haven't heard anybody speak in opposition to the Senator's amendment. I think he is pretty close to his goal.

Mr. BAUCUS. I thank the Chair. Might I ask who controls the remaining time?

Mr. BAUCUS

Mr. BAUCUS. Mr. President, I ask Senator Harkin be allowed to call up his amendment at this time.