Kit Bond

Mr. BOND

Mr. BOND. Mr. President, on Sunday, April 13, 1997, the city of Springfield, MO will dedicate a statue of John Q. Hammons in recognition of his lifelong devotion to his city, his State, and his country. When Thoreau observed that, ``Philanthropy is almost the only virtue which is sufficiently appreciated by mankind,'' he could not have imagined how impossible it has become for Springfield to show sufficiently its appreciation for the generosity of John. He has donated, built, benefactored, patroned, and supported all facets and levels of life in Springfield. When visiting the city, you are aware immediately of John Q. Hammons landmarks which grace and enrich the community. In raising this statue and in knowing they can never adequately express their admiration, respect, and affection, fellow Springfieldians enthusiastically embrace the opportunity to say thank you. Sunday will be a great occasion for the people of Springfield and I join them in paying tribute to John Q. Hammons.

Mr. BOND

Mr. BOND. Mr. President, I wish to announce that the Committee on Small Business will hold a hearing on April 10, 1997, entitled ``S. 208, the HUBZone Act of 1997.'' The hearing will begin at 9:30 a.m. in room 428A of the Russell Senate Office Building. For further information, please contact Paul Cooksey at 224-5175. committee on agriculture, nutrition, and forestry

Mr. BOND. Mr. President, I wish to announce that the Committee on Small Business will hold a markup on April 16, 1997, to mark up legislation pending before the committee. The markup will begin at 10 a.m. in room 428A of the Russell Senate Office Building. For further information, please contact Paul Cooksey at 224-5175. committee on agriculture, nutrition, and forestry

Mr. BOND

Mr. BOND. Mr. President, I stand in strong support of the Multifamily Assisted Housing Reform and Affordability Act of 1997. This bill is virtually identical to S. 2042, which was introduced in the last Congress and goes a long way toward developing a constructive and comprehensive section 8 mark-to-market contract renewal program for reducing the costs of expiring project-based section 8 contracts, limiting the financial exposure of the FHA multifamily housing insurance fund for FHA-insured section 8 projects, and preserving, to the maximum extent possible, the section 8 project-based housing stock for very low- and low-income families. This legislation builds on a demonstration enacted as part of the VA/HUD Fiscal Year 1997 appropriations bill which provided HUD with flexible authority to address the costs and the housing issues posed by this stock. I congratulate Senators D'Amato, Mack, and Bennett for their contribution and commitment to this comprehensive legislation, as well as their commitment to finding a bipartisan approach to the many difficult issues associated with the renewal of oversubsidized section 8 project-based contracts. This legislation is a meaningful step in developing a reasonable policy toward the concerns raised by these expiring section 8 project-based contracts. Over the last 25 years, a number of HUD programs were established for the construction of affordable, low-income housing by providing FHA mortgage insurance while financing the cost of the housing through section 8 project-based housing assistance. Currently, there are some 8,500 projects with almost 1 million units that are both FHA-insured and whose debt service is almost totally dependent on rental assistance payments made under section 8 project-based contracts. Most of these projects serve very low-income families, with almost 50 percent of the stock serving elderly and disabled families. The crisis facing this housing stock is that the section 8 project- based housing assistance was initially budgeted and appropriated through 15- and 20-year section 8 project-based contracts that are now expiring and for which contract renewal is prohibitively expensive. For example, at least 75 percent of this housing stock have rents that exceed the fair market rent of the local area. Since current law generally prohibits HUD from renewing these section 8 contracts at rents above 120 percent of the fair market rent, in many cases, the failure to renew expiring section 8 project-based contracts at existing rents will leave owners without the financial ability to pay the mortgage debt on these projects. This means that owners likely will default on their FHA-insured mortgage liabilities, resulting in FHA mortgage insurance claims totaling some $18 billion and foreclosures. HUD would then own and be responsible for managing these low-income multifamily housing projects. This bill is intended to avoid this potential crisis through a fiscally responsible and housing sensitive strategy. In addition, the cost of the section 8 contracts on these projects reemphasizes the difficult budget and appropriation issues facing the Congress. In particular, according to HUD estimates, the cost of all section 8 contract renewals, both tenant-based and project-based, will require appropriations of about $3.6 billion in Fiscal Year 1997, $10.2 billion in Fiscal Year 1998, and over $16 billion in Fiscal Year 2002. In addition, the cost of renewing the section 8 project-based contracts will grow from $1.2 billion in Fiscal Year 1997 to almost $4 billion in Fiscal Year 2000, and to some $8 billion in 10 years. Since the HUD appropriations account cannot sustain these exploding costs, this legislation is intended to be a comprehensive response which will reduce the financial cost and exposure to the Federal Government and preserve this valuable housing resource. The Senate bill would generally preserve this low-income housing by using various tools to restructure these multifamily housing mortgages to the market value of the housing with resulting reductions in section 8 costs. I also am troubled by some of the other section 8 mark-to-market proposals being promoted, including the position which has been taken by HUD in the past which, in general, opposes preserving this housing as FHA-insured or as assisted through section 8 project-based assistance, including the elderly assisted housing, in favor of vouchers. This position is very questionable, and I emphasize that it is widely opposed by the housing industry and tenant groups and advocates. I emphasize that we want to work with HUD on these issues, and that in appropriate circumstances vouchers may be the right decision if we can balance this decision by ensuring that by restructuring a mortgage to the market level that we also can require long-term affordablility of this housing for very low- and low-income families. This could mean more choice for low-income families and the availability of more affordable, low-income housing. I believe that a number of creative and positive approaches will need to be reviewed as this legislation is considered. I highlight the underlying principles of the bill which would authorize the establishing of participating administrative entities [PAEs] which would generally be a public agency, with a first preference that a PAE be a State housing finance agency or, second, a local housing agency. These entities would be contracted by HUD to develop work-out plans in conjunction with owners of FHA-insured projects with expiring, oversubsidized section 8 contracts. Each PAE would develop mortgage restructuring and rental assistance sufficiency plans as work-out instruments to reduce the section 8 subsidy needs of projects through mortgage restructuring. The basic tool provided in the draft bill, and the likely key to any successful strategy to preserve this housing, is to authorize the restructuring of the mortgage debt on these oversubsidized section 8 multifamily housing projects. In particular, the bill would allow the restructuring of these high-cost mortgages with a new first mortgage reflecting, generally, the market value of a project, and a soft second mortgage held by HUD or financed by the private sector, with interest at the applicable Federal rate, covering the remainder of the original mortgage debt and payable upon disposition or upon full payment of the first mortgage. This provision will reduce the cost of section 8 assistance and minimize any loss to the FHA multifamily insurance fund. In addition, this approach ensures that there is no taxable event by virtue of the mortgage restructuring. I also think it would be beneficial to look at some kind of exit tax relief to encourage owners, especially limited partners, to divest their interest in these properties, to encourage new investment in and the revitalization of these properties. I am hopeful that the administration will help craft some form of tax relief that balances the need of the Government to preserve this housing for low-income use at an affordable and reasonable cost to both the Government and low- income families. Finally, I emphasize that the time to act is now. I sponsored a section 8 mark-to-market demonstration which was included in the VA/HUD Fiscal Year 1997 appropriations bill which is similar to this legislation and represents an interim approach to the section 8 mark- to-market contract renewal issue. I am disappointed that HUD has failed to implement this demonstration because we need the information to continue to make informed policy decisions with regard to this issue. Nevertheless, the appropriation language indicates my strong belief that we can no longer afford, as a matter of housing policy and fiscal responsibility, to renew expiring section 8 project-based contracts at the existing, over-market rents. I strongly believe that section 8 reform legislation should be acted on by the authorizing committees before the end of the fiscal year, with the full benefit of hearings and discussion on these very difficult policy issues. I look forward to working with my colleagues on the legislation and hope that the Housing Subcommittee and Banking Committee can act in an expeditious manner on this measure. I emphasize the need to work together and I look forward to moving this legislation through Congress and onto the desk of the President.

Mr. BOND

Mr. BOND. Mr. President, I stand in strong support of the Multifamily Assisted Housing Reform and Affordability Act of 1997. This bill is virtually identical to S. 2042, which was introduced in the last Congress and goes a long way toward developing a constructive and comprehensive section 8 mark-to-market contract renewal program for reducing the costs of expiring project-based section 8 contracts, limiting the financial exposure of the FHA multifamily housing insurance fund for FHA-insured section 8 projects, and preserving, to the maximum extent possible, the section 8 project-based housing stock for very low- and low-income families. This legislation builds on a demonstration enacted as part of the VA/HUD Fiscal Year 1997 appropriations bill which provided HUD with flexible authority to address the costs and the housing issues posed by this stock. I congratulate Senators D'Amato, Mack, and Bennett for their contribution and commitment to this comprehensive legislation, as well as their commitment to finding a bipartisan approach to the many difficult issues associated with the renewal of oversubsidized section 8 project-based contracts. This legislation is a meaningful step in developing a reasonable policy toward the concerns raised by these expiring section 8 project-based contracts. Over the last 25 years, a number of HUD programs were established for the construction of affordable, low-income housing by providing FHA mortgage insurance while financing the cost of the housing through section 8 project-based housing assistance. Currently, there are some 8,500 projects with almost 1 million units that are both FHA-insured and whose debt service is almost totally dependent on rental assistance payments made under section 8 project-based contracts. Most of these projects serve very low-income families, with almost 50 percent of the stock serving elderly and disabled families. The crisis facing this housing stock is that the section 8 project- based housing assistance was initially budgeted and appropriated through 15- and 20-year section 8 project-based contracts that are now expiring and for which contract renewal is prohibitively expensive. For example, at least 75 percent of this housing stock have rents that exceed the fair market rent of the local area. Since current law generally prohibits HUD from renewing these section 8 contracts at rents above 120 percent of the fair market rent, in many cases, the failure to renew expiring section 8 project-based contracts at existing rents will leave owners without the financial ability to pay the mortgage debt on these projects. This means that owners likely will default on their FHA-insured mortgage liabilities, resulting in FHA mortgage insurance claims totaling some $18 billion and foreclosures. HUD would then own and be responsible for managing these low-income multifamily housing projects. This bill is intended to avoid this potential crisis through a fiscally responsible and housing sensitive strategy. In addition, the cost of the section 8 contracts on these projects reemphasizes the difficult budget and appropriation issues facing the Congress. In particular, according to HUD estimates, the cost of all section 8 contract renewals, both tenant-based and project-based, will require appropriations of about $3.6 billion in Fiscal Year 1997, $10.2 billion in Fiscal Year 1998, and over $16 billion in Fiscal Year 2002. In addition, the cost of renewing the section 8 project-based contracts will grow from $1.2 billion in Fiscal Year 1997 to almost $4 billion in Fiscal Year 2000, and to some $8 billion in 10 years. Since the HUD appropriations account cannot sustain these exploding costs, this legislation is intended to be a comprehensive response which will reduce the financial cost and exposure to the Federal Government and preserve this valuable housing resource. The Senate bill would generally preserve this low-income housing by using various tools to restructure these multifamily housing mortgages to the market value of the housing with resulting reductions in section 8 costs. I also am troubled by some of the other section 8 mark-to-market proposals being promoted, including the position which has been taken by HUD in the past which, in general, opposes preserving this housing as FHA-insured or as assisted through section 8 project-based assistance, including the elderly assisted housing, in favor of vouchers. This position is very questionable, and I emphasize that it is widely opposed by the housing industry and tenant groups and advocates. I emphasize that we want to work with HUD on these issues, and that in appropriate circumstances vouchers may be the right decision if we can balance this decision by ensuring that by restructuring a mortgage to the market level that we also can require long-term affordablility of this housing for very low- and low-income families. This could mean more choice for low-income families and the availability of more affordable, low-income housing. I believe that a number of creative and positive approaches will need to be reviewed as this legislation is considered. I highlight the underlying principles of the bill which would authorize the establishing of participating administrative entities [PAEs] which would generally be a public agency, with a first preference that a PAE be a State housing finance agency or, second, a local housing agency. These entities would be contracted by HUD to develop work-out plans in conjunction with owners of FHA-insured projects with expiring, oversubsidized section 8 contracts. Each PAE would develop mortgage restructuring and rental assistance sufficiency plans as work-out instruments to reduce the section 8 subsidy needs of projects through mortgage restructuring. The basic tool provided in the draft bill, and the likely key to any successful strategy to preserve this housing, is to authorize the restructuring of the mortgage debt on these oversubsidized section 8 multifamily housing projects. In particular, the bill would allow the restructuring of these high-cost mortgages with a new first mortgage reflecting, generally, the market value of a project, and a soft second mortgage held by HUD or financed by the private sector, with interest at the applicable Federal rate, covering the remainder of the original mortgage debt and payable upon disposition or upon full payment of the first mortgage. This provision will reduce the cost of section 8 assistance and minimize any loss to the FHA multifamily insurance fund. In addition, this approach ensures that there is no taxable event by virtue of the mortgage restructuring. I also think it would be beneficial to look at some kind of exit tax relief to encourage owners, especially limited partners, to divest their interest in these properties, to encourage new investment in and the revitalization of these properties. I am hopeful that the administration will help craft some form of tax relief that balances the need of the Government to preserve this housing for low-income use at an affordable and reasonable cost to both the Government and low- income families. Finally, I emphasize that the time to act is now. I sponsored a section 8 mark-to-market demonstration which was included in the VA/HUD Fiscal Year 1997 appropriations bill which is similar to this legislation and represents an interim approach to the section 8 mark- to-market contract renewal issue. I am disappointed that HUD has failed to implement this demonstration because we need the information to continue to make informed policy decisions with regard to this issue. Nevertheless, the appropriation language indicates my strong belief that we can no longer afford, as a matter of housing policy and fiscal responsibility, to renew expiring section 8 project-based contracts at the existing, over-market rents. I strongly believe that section 8 reform legislation should be acted on by the authorizing committees before the end of the fiscal year, with the full benefit of hearings and discussion on these very difficult policy issues. I look forward to working with my colleagues on the legislation and hope that the Housing Subcommittee and Banking Committee can act in an expeditious manner on this measure. I emphasize the need to work together and I look forward to moving this legislation through Congress and onto the desk of the President.

Mr. BOND

Mr. BOND. Mr. President, I rise today in strong support of Senator DeWine's effort to establish a pediatric research initiative within the Office of the Director at the National Institutes of Health [NIH]. To achieve real progress in improving the health of our Nation's most vulnerable and valuable resource--our children--we must strengthen public investments in pediatric research; enhance Federal coordination among the NIH Institutes to ensure quality multi-disciplinary research in areas of scientific progress; develop new incentives for investment in pediatric clinical trials; support new ways to treat children with special conditions; and develop information to promote safer and more effective use of prescription drugs for children. The opportunity for scientific progress in combating and preventing illnesses and diseases affecting children has never been greater. To assist the NIH in strengthening its pediatric research efforts, I, along with other members of the Labor, HHS, and Education Appropriations Subcommittee, successfully secured $5 million for the NIH Office of the Director to begin this new pediatric research initiative last year. Senator DeWine's legislation builds upon that down payment, and I look forward to working with other Members of the Senate in ensuring passage of this effort. Although health care spending for children is only a fraction of total health care spending, we must not turn our backs on the health care needs of our children. Pediatric research offers potential savings in health care costs as well as substantial benefits to the well-being of children for a lifetime. Moreover, pediatric research contributes to new insights and discoveries in preventing and treating illnesses and diseases among our country's adult population. Let me close by saying that this bill complements legislation I introduced last week which will provide surveillance, research, and services aimed at the prevention of birth defects, the No. 1 killer of babies. We currently know the causes of about 30 percent of all birth defects. With the enactment of a pediatric research initiative and the Birth Defects Prevention Act of 1997, we will shed new light on the causes of birth defects as well as numerous other diseases, illnesses, and other health factors afflicting our Nation's children.

Mr. BOND

Mr. BOND. Mr. President, I rise today in strong support of Senator DeWine's effort to establish a pediatric research initiative within the Office of the Director at the National Institutes of Health [NIH]. To achieve real progress in improving the health of our Nation's most vulnerable and valuable resource--our children--we must strengthen public investments in pediatric research; enhance Federal coordination among the NIH Institutes to ensure quality multi-disciplinary research in areas of scientific progress; develop new incentives for investment in pediatric clinical trials; support new ways to treat children with special conditions; and develop information to promote safer and more effective use of prescription drugs for children. The opportunity for scientific progress in combating and preventing illnesses and diseases affecting children has never been greater. To assist the NIH in strengthening its pediatric research efforts, I, along with other members of the Labor, HHS, and Education Appropriations Subcommittee, successfully secured $5 million for the NIH Office of the Director to begin this new pediatric research initiative last year. Senator DeWine's legislation builds upon that down payment, and I look forward to working with other Members of the Senate in ensuring passage of this effort. Although health care spending for children is only a fraction of total health care spending, we must not turn our backs on the health care needs of our children. Pediatric research offers potential savings in health care costs as well as substantial benefits to the well-being of children for a lifetime. Moreover, pediatric research contributes to new insights and discoveries in preventing and treating illnesses and diseases among our country's adult population. Let me close by saying that this bill complements legislation I introduced last week which will provide surveillance, research, and services aimed at the prevention of birth defects, the No. 1 killer of babies. We currently know the causes of about 30 percent of all birth defects. With the enactment of a pediatric research initiative and the Birth Defects Prevention Act of 1997, we will shed new light on the causes of birth defects as well as numerous other diseases, illnesses, and other health factors afflicting our Nation's children.

Mr. BOND

Mr. BOND. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise today to join with a number of my colleagues to say there was a very important argument in the Supreme Court today over the constitutionality of the Communications Decency Act, which we passed last year. You will recall that we passed a bill to make it difficult to communicate pornography to children. The day it was passed and signed, the American Civil Liberties Union jumped in to say it was unconstitutional. I'm sorry, but I think the ACLU has it all wrong. I was very pleased to be one of a group of Senators, including the occupant of the Chair, who signed a brief in support of Congress' effort to impose reasonable regulations and restrictions to prevent the worst form of pornography from reaching our children. Congress can regulate speech when there is a compelling reason. That has been clear. That has been held constitutional in many instances, and I suggest that there is no more compelling need than to protect our children and future generations from exposure to explicit pornographic pictures and messages, and from the people who send them. The government, both the Federal Government and State and local governments, have engaged in efforts to regulate pornography. We regulate media available to children such as the sale of books and magazines, the viewing and sale of films, the use of telephone services to communicate adult messages, and the broadcast media. So, this has been done and it has been done for a very good and I believe a very compelling reason. The standard put forth in the Communications Decency Act is even more stringent than that, in terms of the limitations of it. The constraints are more severely limited than the constraints on the broadcast media. We have tightened up the definitions and made the ban much narrower. The Internet is clearly the latest means of communications. Any of us who have children knows how readily accessible the Internet is. If you are like I am, when you have a computer problem you ask your child how to fix it, because the children know how to make it work. My forehead still breaks out in perspiration and my hands shake when I try to send e-mail. But the kids can not only send the e-mail for you, they can tell you how to send it, fix the problems on it, and make things happen. We want to make sure that what they do not make happen is that they get access to things that are now banned to them through adult book stores, through broadcast media, through telephone communications. They should not be subject to the deviants, the pornographers, the child molesters who want to use the Internet in an interactive way to get access to our children. There are, unfortunately, an abundance of examples of where perverts have used Internet communications to communicate with and to lure young children to locations away from their homes. They have used pornography as a tool. Not only have they polluted children's minds with this pornography, but they have used it as a tool for their own, very sick purposes. In Louisville, I know there was a 12-year-old girl who was sent a bus ticket and left home without her parents knowing about it. These examples have happened time and time again. I believe this Congress had every right to say it is OK for adults to communicate anything they want but you cannot be sending material to children that is pornographic. You cannot be putting pornographic information on the kiddie chat rooms. Contrary to what the ACLU will tell you, the Communications Decency Act does not ban speech or interrupt the free exchange of ideas. There is technology available that can keep children from gaining access to it. And if it takes a pornographer a little more difficulty to communicate pornographic materials to another consenting adult, so they do not get the information before children, I am not going to lose any sleep over it. There is every reason that we can, under the Communications Decency Act, continue to use the Communications Decency Act for communicating medical information, discussing literature--these are not banned. If the purpose is getting pornography, for pornographic purposes or even personal whims of those who communicate it, to children, that the Communications Decency Act bans. I think this should be upheld. I am proud to be one of the signers of the brief and we will all be watching to see this very important case resolved by the U.S. Supreme Court. I yield the floor. Mr. COATS addressed the Chair.

Mr. BOND

Mr. BOND. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, home-based businesses are a significant and often overlooked part of this country's economy. Some people may be surprised to learn that over 9 million men and women in this country now operate home-based businesses, and over 14 million individuals earn income through home-based businesses. Even more impressive is the fact that a majority of these enterprises are owned by women, and the Small Business Administration estimates that women in this country are starting over 300,000 new home-based businesses each year. There are a number of reasons for the explosive growth of home-based businesses. Recent innovations in computer and communication technology have made the virtual office a reality and allow many Americans to compete in marketplaces that a few years ago required huge investments in equipment and personnel. In addition, many men and women in this country turn to home-based business in an effort to spend more time with their children. By working at home, these families can bring in two incomes, while avoiding the added time and expense of day-care and commuting. Corporate down-sizing, too, contributes to the growth in this sector as many skilled individuals convert their knowledge and experience from corporate life into successful enterprises operated from their homes. The rewards of owning a home-based business are also numerous. The added independence and self-reliance of having your own business provides not only economic rewards but also personal satisfaction. You are the boss: you set your own hours, develop your own business plans, and choose your customers and clients. In many ways, home-based businesses provide the greatest avenue for the entrepreneurial spirit, which has long been the driving force behind the success of this country. But with these rewards comes a number of obstacles, not the least of which are regulations and burdens imposed by the Federal Government. In fact, the tax laws, and in particular the IRS, are frequently cited as the most significant problems for home-based businesses today. Changes in tax policy must be considered by this Congress to ensure that our laws do not stall the growth and development of this successful sector of our economy. Mr. President, in answer to this call for help, I am introducing today the Home-Based Business Fairness Act of 1997. This legislation is the product of extensive input from actual home-based business owners and the efforts of my colleagues Senators Olympia Snowe and Don Nickles. The bill is designed to address three tax issues that currently pose significant problems for home-based businesses. deductibility of health-insurance costs for the self-employed First, the bill addresses the deductibility of health-insurance costs for the self-employed. During the 104th Congress, we made significant progress in this area. First, we made the deduction permanent after years of uncertainty. Then, last summer, we passed legislation that will increase the deduction for these health-care costs to 80 percent incrementally by 2006. While I fully supported that increase, the self- employed cannot wait 10 years for partial deductibility when their large corporate competitors can fully deduct such costs today. With the self-employed able to deduct only 40 percent of their health-insurance costs today, it comes as no surprise that nearly a quarter of the self-employed, many of whom operate home-based businesses, do not have health insurance. In fact, 4 million households in this country headed by a self-employed individual do not have health insurance. In order to make it easier for home-based business owners and their families to have health insurance, we must level this playing field. My bill will increase the deductibility of health insurance for the self- employed to 100 percent beginning this year. A full deduction will make health insurance more affordable to home-based business owners and help them and their families get the health insurance coverage that they need and deserve. home-office deduction Second, the Home-Based Business Fairness Act will restore the home- office deduction and further level the playing field for home-based businesses. After the Supreme Court's 1993 Soliman decision, the only home-based businesses that can deduct the costs associated with their home office are those that see their clients in the home and that generate their income within the home office. That narrow interpretation of the law denies the home-office deduction to service providers like construction contractors, landscaping professionals, and sales representatives, who must by necessity perform their services outside of the home. It is patently unfair to prevent these individuals from deducting their utility costs, property taxes, and other expenses related to the home office, when they could do so if they rented an office separate from the home. I thank my colleague from Utah, Senator Hatch, for his willingness to allow us to work together on this issue. My bill incorporates the legislation that Senator Hatch introduced earlier this month and will permit a home office to include one where the individual performs his essential administrative and management activities such a billing and record keeping. In order to qualify for the deduction, the bill requires that the business owner perform these activities on a regular, on-going, and nonincidental basis and have no other office in which to perform them. The restoration of the home-office deduction for home-based businesses not only puts them on an equal footing with their larger competitors, but also frees important capital that can be used to expand the business. For too long home-based businesses have lived with the fear of an IRS audit fueled by the Soliman decision. It is time to eliminate this obstacle to the continued success of these important entrepreneurs. Clarification of Independent-Contractor Status The final element of the Home-Based Business Fairness Act is relief for entrepreneurs seeking to be treated as independent contractors and for businesses needing to hire independent contractors. As the chairman of the Small Business Committee, I have heard from countless small business owners who are caught in the environment of fear and confusion that now surrounds the classification of workers. This situation is stifling the entrepreneurial spirit of many small business owners who find that they do not have the flexibility to conduct their businesses in a manner that makes the best economic sense and that serves their personal and family goals. Mr. President, the root of this problem is found in the IRS' test for determining whether a worker is an independent contractor or an employee. Over the past three decades, the IRS has relied on a 20- factor test based on the common law to make this determination. On first blush, a 20-factor test sounds like a reasonable approach: if a taxpayer demonstrates a majority of the factors, he or she is an independent contractor. Not surprisingly, the IRS' test is not that simple. It is a complex set of extremely subjective criteria with no clear weight assigned to any of the factors. As a result, a small business taxpayer is not able to predict which of the 20 factors will be most important to a particular IRS agent, and finding a certain number of these factors in any given case does not guarantee the outcome. To make matters worse, the IRS' determination inevitably occurs 2 or 3 years after the parties have determined in good faith that they have an independent-contractor relationship. And the consequences can be devastating. The business recipient of the services is forced to reclassify the independent contractor as an employee and must pay the payroll taxes the IRS says should have been collected in the prior years. Interest and penalties are also added on. The result for many small businesses is a tax bill that bankrupts the company. And that's not the end of the story. The IRS then goes after the service provider, who is now classified as an employee, and disallows a portion of his business expenses--again resulting in additional taxes, interest, and penalties. Mr. President, all of us in this body recognize that the IRS is charged with the duty of collecting Federal revenues and enforcing the tax laws. The problem in this case is that the IRS is using a procedure that is patently unfair and is doing so on an increasingly frequent basis. Between 1988 and 1994, the IRS' use of the 20-factor test resulted in some 11,000 audits, 483,000 worker reclassifications, and $751 million in back taxes and penalties. These facts make me wonder whether the IRS is using this test as a de facto source of enhanced revenue collection when the classification decision does not alter the aggregate tax liability to the Federal Government at all. For its part, the IRS has just released its revised worker classification training manual. In the Commissioner's accompanying memo, she describes the manual as an ``attempt to identify, simplify, and clarify the relevant facts that should be evaluated in order to accurately determine worker classification. . . .'' There can be no more compelling reason for immediate action on this issue. The revised manual is over 150 pages--even longer than the original draft. If it takes this many pages to teach revenue agents how to simplify and clarify this small business tax issue, I think we can be fairly sure how simple and clear it is going to seem to the taxpayer who tries to figure it out on his own. The Home-Based Business Fairness Act removes the need for so many pages of instruction on the 20-factor test by establishing a clear safe harbor based on objective criteria. Under these criteria, if there is a written agreement between the parties, and if an individual demonstrates economic independence and independence with respect to the workplace, he will be treated as an independent contractor rather than an employee. And the service recipient will not be treated as an employer. In addition, individuals who perform services through their own corporations will also qualify for the safe harbor as long as there is a written agreement and the individuals provide for their own benefits. The safe harbor is simple, straightforward, and final. To take advantage of it, payments above $600 per year to an individual service provider must be reported to the IRS, just as is required under current law. This will help ensure that taxes properly due to the Treasury will continue to be collected. Mr. President, the IRS contends that there are millions of independent contractors who should be classified as employees, which costs the Federal Government billions of dollars a year. This assertion is plainly incorrect. Classification of a worker has no cost to the Government. What costs the Government are taxpayers who do not pay their taxes. My bill has two requirements that I believe will improve compliance among independent contractors using the safe harbor. First, there must be a written agreement between the parties--this will help the independent contractor know from the beginning that he is responsible for his own tax payments. Second, the safe harbor will not apply if the service recipient does not comply with the reporting requirements and issue 1099's to individuals who perform services. My bill also provides relief for businesses and independent contractors when the IRS determines that a worker was misclassified. Under the bill, if the business and the independent contractor have a written agreement, if the applicable reporting requirements were met, and if there was a reasonable basis for the parties to believe that the worker is an independent contractor, then any IRS reclassification upheld in court will only apply prospectively. This provision gives important peace of mind to small businesses that act in good faith by removing the unpredictable threat of retroactive reclassification and substantial interest and penalties. A final provision of this legislation, Mr. President, is the repeal of section 1706 of the 1986 Tax Reform Act. This provision effectively barred an entire group of independent contractors from the protection available in section 530 of the Revenue Act of 1978. When section 1706 was enacted, its proponents argued that technical service workers--such as engineers, designers, and computer programmers--were less compliant in paying their taxes. Later examination of this issue by the Treasury Department found that technical service workers are in fact more likely to pay their taxes than most other types of independent contractors. This revelation underscores the need to repeal section 1706 and level the playing field for individuals in these professions. In the 104th Congress, proposals to repeal section 1706 enjoyed wide bi-partisan support, and it is my hope that the 105th Congress will finally act on this proposal to restore equality for these professionals. Mr. President, the importance of adding clarity to the independent- contractor situation is underscored by the fact that the 2,000 delegates to the 1995 White House Conference on Small Business voted to designate it as their top priority. At that conference, IRS Commissioner Richardson noted that either classification--independent contractor or employee--can be a valid and appropriate business choice as long as the individual pays his taxes. This conclusion was later affirmed in the IRS' new worker classification training manual. It is time that the law reflect this conclusion and allow small businesses to hire employees or independent contractors as their business needs demand, without the fear and uncertainty that now prevails. The Home-Based Business Fairness Act is a common-sense measure that will provide tax fairness for the increasing number of individuals who operate their businesses from home and contribute so significantly to the strength of our economy. These business owners have waited far too long. I urge the members of the Finance Committee to work with Senator Nickles and to report out a bill that provides these three much needed changes in the tax law so that we do not keep them waiting any longer. Mr. President, I ask unanimous consent that additional material be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise in support with Senators Mack and D'Amato in introducing the Public Housing Reform and Responsibility Act of 1997. This legislation is substantially the same as S. 1260 which passed the Senate in the 104th Congress, but fell short of enactment in the waning days of that Congress. This legislation is a critical step to the needed reform of the Department of Housing and Urban Development, as well as a major reform bill in its own right. This legislation consolidates the public housing and section 8 tenant-based assistance programs, and redirects the responsibility and authority for public housing and section 8 back to federally assisted residents, the public housing agencies, the localities, and the States. This bill also dovetails with many of the public housing reforms contained in the VA/HUD fiscal years 1996 and 1997 appropriations bills and reflects the need to provide streamlined programs and local responsibility as the most appropriate method to address local housing needs. I cannot emphasize enough the need to find a measured solution to the housing problems of this Nation and to HUD's overregulation of housing and community issues that are better addressed at the local level. This bill represents a complete overhaul of the public housing system and the section 8 tenant-based program and a move away from HUD's all too common one-size-fits-all mentality. The linchpin of this legislation is to place the responsibility for the decisionmaking for public housing issues, from the demolition of obsolete units to the issue of elderly only housing to the voluntary conversion of public housing to tenant-based assistance, in the hands of local public housing agencies through public housing agency plans developed in conjunction with residents and consistent with state and local housing plans. In addition, this legislation would continue to protect the poorest of the poor by requiring PHA's to continue to make 40 percent of all units available to families whose incomes do not exceed 30 percent of the area median income, 75 percent of all units to families whose incomes do not exceed 60 percent of median income and to make all other units available to families with incomes no greater than 80 percent of median income. This bill also reforms and consolidates the section 8 voucher and certificate program into a single voucher program which will reduce administrative burden and increase the acceptability of vouchers in the private housing market. Finally, the bill continues the Distressed Public Housing Program for the demolition of obsolete and uninhabitable public housing. Obsolete public housing has long been a drag on communities, and I consider it an absolute priority to remove these projects and provide low-income families with positive, affordable housing choices. I see this bill as part of a downpayment on a larger HUD reform effort which I expect to be pursued throughout this Congress. I look forward to working with my colleagues on these important issues and I am optimistic that we can address many of them.

Mr. BOND

Mr. BOND. Mr. President, home-based businesses are a significant and often overlooked part of this country's economy. Some people may be surprised to learn that over 9 million men and women in this country now operate home-based businesses, and over 14 million individuals earn income through home-based businesses. Even more impressive is the fact that a majority of these enterprises are owned by women, and the Small Business Administration estimates that women in this country are starting over 300,000 new home-based businesses each year. There are a number of reasons for the explosive growth of home-based businesses. Recent innovations in computer and communication technology have made the virtual office a reality and allow many Americans to compete in marketplaces that a few years ago required huge investments in equipment and personnel. In addition, many men and women in this country turn to home-based business in an effort to spend more time with their children. By working at home, these families can bring in two incomes, while avoiding the added time and expense of day-care and commuting. Corporate down-sizing, too, contributes to the growth in this sector as many skilled individuals convert their knowledge and experience from corporate life into successful enterprises operated from their homes. The rewards of owning a home-based business are also numerous. The added independence and self-reliance of having your own business provides not only economic rewards but also personal satisfaction. You are the boss: you set your own hours, develop your own business plans, and choose your customers and clients. In many ways, home-based businesses provide the greatest avenue for the entrepreneurial spirit, which has long been the driving force behind the success of this country. But with these rewards comes a number of obstacles, not the least of which are regulations and burdens imposed by the Federal Government. In fact, the tax laws, and in particular the IRS, are frequently cited as the most significant problems for home-based businesses today. Changes in tax policy must be considered by this Congress to ensure that our laws do not stall the growth and development of this successful sector of our economy. Mr. President, in answer to this call for help, I am introducing today the Home-Based Business Fairness Act of 1997. This legislation is the product of extensive input from actual home-based business owners and the efforts of my colleagues Senators Olympia Snowe and Don Nickles. The bill is designed to address three tax issues that currently pose significant problems for home-based businesses. deductibility of health-insurance costs for the self-employed First, the bill addresses the deductibility of health-insurance costs for the self-employed. During the 104th Congress, we made significant progress in this area. First, we made the deduction permanent after years of uncertainty. Then, last summer, we passed legislation that will increase the deduction for these health-care costs to 80 percent incrementally by 2006. While I fully supported that increase, the self- employed cannot wait 10 years for partial deductibility when their large corporate competitors can fully deduct such costs today. With the self-employed able to deduct only 40 percent of their health-insurance costs today, it comes as no surprise that nearly a quarter of the self-employed, many of whom operate home-based businesses, do not have health insurance. In fact, 4 million households in this country headed by a self-employed individual do not have health insurance. In order to make it easier for home-based business owners and their families to have health insurance, we must level this playing field. My bill will increase the deductibility of health insurance for the self- employed to 100 percent beginning this year. A full deduction will make health insurance more affordable to home-based business owners and help them and their families get the health insurance coverage that they need and deserve. home-office deduction Second, the Home-Based Business Fairness Act will restore the home- office deduction and further level the playing field for home-based businesses. After the Supreme Court's 1993 Soliman decision, the only home-based businesses that can deduct the costs associated with their home office are those that see their clients in the home and that generate their income within the home office. That narrow interpretation of the law denies the home-office deduction to service providers like construction contractors, landscaping professionals, and sales representatives, who must by necessity perform their services outside of the home. It is patently unfair to prevent these individuals from deducting their utility costs, property taxes, and other expenses related to the home office, when they could do so if they rented an office separate from the home. I thank my colleague from Utah, Senator Hatch, for his willingness to allow us to work together on this issue. My bill incorporates the legislation that Senator Hatch introduced earlier this month and will permit a home office to include one where the individual performs his essential administrative and management activities such a billing and record keeping. In order to qualify for the deduction, the bill requires that the business owner perform these activities on a regular, on-going, and nonincidental basis and have no other office in which to perform them. The restoration of the home-office deduction for home-based businesses not only puts them on an equal footing with their larger competitors, but also frees important capital that can be used to expand the business. For too long home-based businesses have lived with the fear of an IRS audit fueled by the Soliman decision. It is time to eliminate this obstacle to the continued success of these important entrepreneurs. Clarification of Independent-Contractor Status The final element of the Home-Based Business Fairness Act is relief for entrepreneurs seeking to be treated as independent contractors and for businesses needing to hire independent contractors. As the chairman of the Small Business Committee, I have heard from countless small business owners who are caught in the environment of fear and confusion that now surrounds the classification of workers. This situation is stifling the entrepreneurial spirit of many small business owners who find that they do not have the flexibility to conduct their businesses in a manner that makes the best economic sense and that serves their personal and family goals. Mr. President, the root of this problem is found in the IRS' test for determining whether a worker is an independent contractor or an employee. Over the past three decades, the IRS has relied on a 20- factor test based on the common law to make this determination. On first blush, a 20-factor test sounds like a reasonable approach: if a taxpayer demonstrates a majority of the factors, he or she is an independent contractor. Not surprisingly, the IRS' test is not that simple. It is a complex set of extremely subjective criteria with no clear weight assigned to any of the factors. As a result, a small business taxpayer is not able to predict which of the 20 factors will be most important to a particular IRS agent, and finding a certain number of these factors in any given case does not guarantee the outcome. To make matters worse, the IRS' determination inevitably occurs 2 or 3 years after the parties have determined in good faith that they have an independent-contractor relationship. And the consequences can be devastating. The business recipient of the services is forced to reclassify the independent contractor as an employee and must pay the payroll taxes the IRS says should have been collected in the prior years. Interest and penalties are also added on. The result for many small businesses is a tax bill that bankrupts the company. And that's not the end of the story. The IRS then goes after the service provider, who is now classified as an employee, and disallows a portion of his business expenses--again resulting in additional taxes, interest, and penalties. Mr. President, all of us in this body recognize that the IRS is charged with the duty of collecting Federal revenues and enforcing the tax laws. The problem in this case is that the IRS is using a procedure that is patently unfair and is doing so on an increasingly frequent basis. Between 1988 and 1994, the IRS' use of the 20-factor test resulted in some 11,000 audits, 483,000 worker reclassifications, and $751 million in back taxes and penalties. These facts make me wonder whether the IRS is using this test as a de facto source of enhanced revenue collection when the classification decision does not alter the aggregate tax liability to the Federal Government at all. For its part, the IRS has just released its revised worker classification training manual. In the Commissioner's accompanying memo, she describes the manual as an ``attempt to identify, simplify, and clarify the relevant facts that should be evaluated in order to accurately determine worker classification. . . .'' There can be no more compelling reason for immediate action on this issue. The revised manual is over 150 pages--even longer than the original draft. If it takes this many pages to teach revenue agents how to simplify and clarify this small business tax issue, I think we can be fairly sure how simple and clear it is going to seem to the taxpayer who tries to figure it out on his own. The Home-Based Business Fairness Act removes the need for so many pages of instruction on the 20-factor test by establishing a clear safe harbor based on objective criteria. Under these criteria, if there is a written agreement between the parties, and if an individual demonstrates economic independence and independence with respect to the workplace, he will be treated as an independent contractor rather than an employee. And the service recipient will not be treated as an employer. In addition, individuals who perform services through their own corporations will also qualify for the safe harbor as long as there is a written agreement and the individuals provide for their own benefits. The safe harbor is simple, straightforward, and final. To take advantage of it, payments above $600 per year to an individual service provider must be reported to the IRS, just as is required under current law. This will help ensure that taxes properly due to the Treasury will continue to be collected. Mr. President, the IRS contends that there are millions of independent contractors who should be classified as employees, which costs the Federal Government billions of dollars a year. This assertion is plainly incorrect. Classification of a worker has no cost to the Government. What costs the Government are taxpayers who do not pay their taxes. My bill has two requirements that I believe will improve compliance among independent contractors using the safe harbor. First, there must be a written agreement between the parties--this will help the independent contractor know from the beginning that he is responsible for his own tax payments. Second, the safe harbor will not apply if the service recipient does not comply with the reporting requirements and issue 1099's to individuals who perform services. My bill also provides relief for businesses and independent contractors when the IRS determines that a worker was misclassified. Under the bill, if the business and the independent contractor have a written agreement, if the applicable reporting requirements were met, and if there was a reasonable basis for the parties to believe that the worker is an independent contractor, then any IRS reclassification upheld in court will only apply prospectively. This provision gives important peace of mind to small businesses that act in good faith by removing the unpredictable threat of retroactive reclassification and substantial interest and penalties. A final provision of this legislation, Mr. President, is the repeal of section 1706 of the 1986 Tax Reform Act. This provision effectively barred an entire group of independent contractors from the protection available in section 530 of the Revenue Act of 1978. When section 1706 was enacted, its proponents argued that technical service workers--such as engineers, designers, and computer programmers--were less compliant in paying their taxes. Later examination of this issue by the Treasury Department found that technical service workers are in fact more likely to pay their taxes than most other types of independent contractors. This revelation underscores the need to repeal section 1706 and level the playing field for individuals in these professions. In the 104th Congress, proposals to repeal section 1706 enjoyed wide bi-partisan support, and it is my hope that the 105th Congress will finally act on this proposal to restore equality for these professionals. Mr. President, the importance of adding clarity to the independent- contractor situation is underscored by the fact that the 2,000 delegates to the 1995 White House Conference on Small Business voted to designate it as their top priority. At that conference, IRS Commissioner Richardson noted that either classification--independent contractor or employee--can be a valid and appropriate business choice as long as the individual pays his taxes. This conclusion was later affirmed in the IRS' new worker classification training manual. It is time that the law reflect this conclusion and allow small businesses to hire employees or independent contractors as their business needs demand, without the fear and uncertainty that now prevails. The Home-Based Business Fairness Act is a common-sense measure that will provide tax fairness for the increasing number of individuals who operate their businesses from home and contribute so significantly to the strength of our economy. These business owners have waited far too long. I urge the members of the Finance Committee to work with Senator Nickles and to report out a bill that provides these three much needed changes in the tax law so that we do not keep them waiting any longer. Mr. President, I ask unanimous consent that additional material be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I offer my sincere appreciation to my distinguished friend, the chairman of the committee.

Mr. BOND. I thank the Chair. (The remarks of Mr. Bond pertaining to the introduction of S. 419 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. BOND

Mr. BOND. Mr. President, I rise today to introduce the Birth Defects Prevention Act of 1997. I introduce this on behalf of myself, Senators Lott, Daschle, Hollings, Hutchinson of Arkansas, Cochran, Kohl, Inouye, Moynihan, Chafee, and Breaux. The March of Dimes and their volunteers are here today to lend support to an often overlooked, but a very compelling health care problem in the United States today. Many people do not realize that birth defects are the leading cause of infant deaths in the United States. This year alone, an estimated 150,000 babies will be born with a serious birth defect, and one out of every five of these babies will die. Nationally, birth defects affect 3 percent of all births, and among the babies who survive, birth defects are a significant cause of lifelong disability. Depending on the particular type of problem and its severity, special medical treatment, education, rehabilitation and other services may be required into adulthood, costing billions of dollars each year. A 1995 Centers for Disease Control and Prevention report revealed that the lifetime cost for just 18 common birth defects occurring in a single year is $8 billion. Yet, only about 22 percent of those born with birth defects are included in these figures. And, of course, it is impossible to measure the pain and the heartache that birth defects cause. Let me share with you just a couple of experiences I have had in Missouri. I have worked for a long time to improve children's health. I appropriated money in the early 1970's in Missouri to fund the high- cost, but highly effective, neonatal care units at our hospitals. They do a wonderful job of saving very-low-birth-weight babies and babies with severe defects. But that is not enough. We can do some things to lower the incidence of birth defects, and birth defects can strike any family. I know, many people say one of the real problems is we have too many young women, often unmarried, who do not know that you cannot use tobacco or alcohol or drugs during pregnancy without expecting a bad birth outcome. But there are many other things that we have only recently learned that are extremely important. Four hundred milligrams a day of folic acid, vitamin B, for women of childbearing years can substantially reduce the risk of a child born with spina bifida. A very good friend of ours had a child born with spina bifida. He was a wonderful young man, but he has had to go through many expensive operations. His parents went through much heartache, and he still is not able to move as the rest of us can. Birth defects can be dealt with if we have a concerted national strategy to direct the Centers for Disease Control to collect the information on birth defects, to provide funding and support in research at the State level and to set up five regional centers to deal with birth defects. A few years ago, the incidence of birth defects became a very major concern in certain Hispanic communities in southwest Texas, and, as a result, the Hispanic caucus joined with me in past years, in past sessions of Congress, to sponsor this legislation. We were able to appropriate some moneys for the Centers for Disease Control, but we have not been able to establish a national strategy, maybe because there are not lobbyists for those who have not yet been born who may be at risk of birth defects, but there are effective spokespeople, like the March of Dimes, the American Academy of Pediatrics, and a long list of distinguished organizations. The time has come to join with them, with the Easter Seals Society, the American Hospital Association, and all of the other organizations, in developing and directing the Centers for Disease Control to work with States and local governments to survey birth defects, to bring together the information on birth defects so that researchers have a means of dealing with it. Mr. President, birth defects are the leading cause of infant death in the United States. This year alone, an estimated 150,000 babies will be born with a serious birth defect, and 1 out of every 5 of these babies will die. In addition, birth defects affect 3 percent of all births nationally. Among babies who survive, birth defects are a significant cause of lifelong disability. Depending on the particular type of problem and its severity, special medical treatment, education, rehabilitation, and other services may be required into adulthood--costing billions of dollars each year. A 1995 Centers for Disease Control and Prevention report revealed that the lifetime cost for just 18 common birth defects occurring in a single year is $8 billion--yet only about 22 percent of those born with birth defects are included in these figures. And, of course, it is impossible to measure the pain and heartache that birth defects cause. It may surprise you to learn that the United States does not have a coordinated strategy for reducing the incidence of birth defects. It is both shocking and disappointing how few Federal resources are devoted to prevent this tragic, perhaps even partly preventable public health problem. So today, in an effort to tackle this devastating problem head on, I am introducing the Birth Defects Prevention Act of 1997. Congressmen Solomon Ortiz and Henry Bonilla are simultaneously introducing this bill in the House of Representatives. This bill will prioritize our efforts and make congressional intent clear--more resources should be directed to the prevention of the leading killer of babies, birth defects. An unfortunate situation in the State of Texas a few years ago exemplifies how the lack of a birth defects prevention strategy delayed the response to an outbreak of birth defects and may have needlessly cost innocent lives. Health professionals in Texas observed that six infants were born with anencephaly over a 6-week period. Anencephaly is a fetal birth defect characterized by an absence of brain tissue. The Texas Department of Health conducted a study after this information was reported. The study revealed that since 1989, at least 30 infants in south Texas had been born without or with little brain tissue. However, because Texas did not have a birth defects surveillance program, the severity of the problem was not recognized until the incidence of anencephaly was so high that it was difficult to miss. This tragic event in south Texas underscores the need for a coordinated national effort to research the causes of birth defects and to prevent such defects from occurring in the first place. A little prevention goes a long way in preventing family pain and heartache. It is up to our Nation to seize on this excellent opportunity to protect our most vulnerable resources--our children. To achieve the goal of protecting our Nation's kids, this legislation does several things. First, the bill provides Federal grants to State health authorities for the purpose of collecting, analyzing, and reporting birth defects statistics. Today, only about half of the States have some kind of birth defects surveillance system. Second, this legislation calls for the establishment of at least five regional centers of birth defects prevention research. These regional programs will collect and analyze information on the number, incidence, and causes of birth defects within a region as well as provide education and training for health professionals aimed at the prevention of birth defects. At least one of the centers will focus on birth defects among ethnic minorities. Third, the Centers for Disease Control and Prevention [CDC] is directed to be the coordinating agency for birth defects prevention activities. The CDC will serve as a clearinghouse for the collection and storage of data generated from State and regional birth defects monitoring programs. Finally, grants will be available to State departments of health, universities, or other private, or nonprofit entities to develop and implement birth defect prevention strategies, such as programs using folic acid vitamin supplements to prevent spina bifida and alcohol avoidance strategies to prevent fetal alcohol syndrome. Again, when we talk about birth defects, it is important to note that many birth defects are preventable. For instance, we now know that a simple 400 mg dose of the B vitamin folic acid each day could prevent 50 to 70 percent of all cases of spina bifida and anencephaly--saving about $245 million annually and more importantly, saving some families the heart ache that many of us have witnessed friends and families go through. We must broaden public and professional awareness of birth defects and prevention opportunities, and we must have a coordinated national strategy to achieve this goal. The economic and emotional burden of birth defects on families and society as a whole presents a vivid, human picture of the need for a national research and prevention strategy. Although infant mortality in the United States has been falling steadily over the past few decades, 25 other countries have lower infant mortality rates than the United States. This bill is an important step in improving the health of our Nation. The tragedy of birth defects compels our Nation to become a stronger partner for charitable and medical groups in fulfilling our obligation to protect our Nation's most vulnerable population. Let us hope that more tragedies are not necessary to push Congress into action. This legislation has the support of many national organizations, including: the March of Dimes Foundation, the Spina Bifida Association of America, American Academy of Pediatrics, National Association of Children's Hospitals, the National Easter Seals Society, American Association of Mental Retardation, Association of Maternal and Child Health Programs, and the American Hospital Association. The bill also has broad bipartisan support. Let me conclude by taking special note of the help of the National and Missouri March of Dimes, as well as numerous health and child advocate organizations, for their assistance in developing and advocating this legislation. Specifically, I wish to thank Dr. Jennifer Howse, Jo Merrill, and Marina Weiss of the March of Dimes for their persistence and commitment to this endeavor. Mr. President, I send a copy of the bill to the desk and ask unanimous consent that it be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise today to introduce the Birth Defects Prevention Act of 1997. I introduce this on behalf of myself, Senators Lott, Daschle, Hollings, Hutchinson of Arkansas, Cochran, Kohl, Inouye, Moynihan, Chafee, and Breaux. The March of Dimes and their volunteers are here today to lend support to an often overlooked, but a very compelling health care problem in the United States today. Many people do not realize that birth defects are the leading cause of infant deaths in the United States. This year alone, an estimated 150,000 babies will be born with a serious birth defect, and one out of every five of these babies will die. Nationally, birth defects affect 3 percent of all births, and among the babies who survive, birth defects are a significant cause of lifelong disability. Depending on the particular type of problem and its severity, special medical treatment, education, rehabilitation and other services may be required into adulthood, costing billions of dollars each year. A 1995 Centers for Disease Control and Prevention report revealed that the lifetime cost for just 18 common birth defects occurring in a single year is $8 billion. Yet, only about 22 percent of those born with birth defects are included in these figures. And, of course, it is impossible to measure the pain and the heartache that birth defects cause. Let me share with you just a couple of experiences I have had in Missouri. I have worked for a long time to improve children's health. I appropriated money in the early 1970's in Missouri to fund the high- cost, but highly effective, neonatal care units at our hospitals. They do a wonderful job of saving very-low-birth-weight babies and babies with severe defects. But that is not enough. We can do some things to lower the incidence of birth defects, and birth defects can strike any family. I know, many people say one of the real problems is we have too many young women, often unmarried, who do not know that you cannot use tobacco or alcohol or drugs during pregnancy without expecting a bad birth outcome. But there are many other things that we have only recently learned that are extremely important. Four hundred milligrams a day of folic acid, vitamin B, for women of childbearing years can substantially reduce the risk of a child born with spina bifida. A very good friend of ours had a child born with spina bifida. He was a wonderful young man, but he has had to go through many expensive operations. His parents went through much heartache, and he still is not able to move as the rest of us can. Birth defects can be dealt with if we have a concerted national strategy to direct the Centers for Disease Control to collect the information on birth defects, to provide funding and support in research at the State level and to set up five regional centers to deal with birth defects. A few years ago, the incidence of birth defects became a very major concern in certain Hispanic communities in southwest Texas, and, as a result, the Hispanic caucus joined with me in past years, in past sessions of Congress, to sponsor this legislation. We were able to appropriate some moneys for the Centers for Disease Control, but we have not been able to establish a national strategy, maybe because there are not lobbyists for those who have not yet been born who may be at risk of birth defects, but there are effective spokespeople, like the March of Dimes, the American Academy of Pediatrics, and a long list of distinguished organizations. The time has come to join with them, with the Easter Seals Society, the American Hospital Association, and all of the other organizations, in developing and directing the Centers for Disease Control to work with States and local governments to survey birth defects, to bring together the information on birth defects so that researchers have a means of dealing with it. Mr. President, birth defects are the leading cause of infant death in the United States. This year alone, an estimated 150,000 babies will be born with a serious birth defect, and 1 out of every 5 of these babies will die. In addition, birth defects affect 3 percent of all births nationally. Among babies who survive, birth defects are a significant cause of lifelong disability. Depending on the particular type of problem and its severity, special medical treatment, education, rehabilitation, and other services may be required into adulthood--costing billions of dollars each year. A 1995 Centers for Disease Control and Prevention report revealed that the lifetime cost for just 18 common birth defects occurring in a single year is $8 billion--yet only about 22 percent of those born with birth defects are included in these figures. And, of course, it is impossible to measure the pain and heartache that birth defects cause. It may surprise you to learn that the United States does not have a coordinated strategy for reducing the incidence of birth defects. It is both shocking and disappointing how few Federal resources are devoted to prevent this tragic, perhaps even partly preventable public health problem. So today, in an effort to tackle this devastating problem head on, I am introducing the Birth Defects Prevention Act of 1997. Congressmen Solomon Ortiz and Henry Bonilla are simultaneously introducing this bill in the House of Representatives. This bill will prioritize our efforts and make congressional intent clear--more resources should be directed to the prevention of the leading killer of babies, birth defects. An unfortunate situation in the State of Texas a few years ago exemplifies how the lack of a birth defects prevention strategy delayed the response to an outbreak of birth defects and may have needlessly cost innocent lives. Health professionals in Texas observed that six infants were born with anencephaly over a 6-week period. Anencephaly is a fetal birth defect characterized by an absence of brain tissue. The Texas Department of Health conducted a study after this information was reported. The study revealed that since 1989, at least 30 infants in south Texas had been born without or with little brain tissue. However, because Texas did not have a birth defects surveillance program, the severity of the problem was not recognized until the incidence of anencephaly was so high that it was difficult to miss. This tragic event in south Texas underscores the need for a coordinated national effort to research the causes of birth defects and to prevent such defects from occurring in the first place. A little prevention goes a long way in preventing family pain and heartache. It is up to our Nation to seize on this excellent opportunity to protect our most vulnerable resources--our children. To achieve the goal of protecting our Nation's kids, this legislation does several things. First, the bill provides Federal grants to State health authorities for the purpose of collecting, analyzing, and reporting birth defects statistics. Today, only about half of the States have some kind of birth defects surveillance system. Second, this legislation calls for the establishment of at least five regional centers of birth defects prevention research. These regional programs will collect and analyze information on the number, incidence, and causes of birth defects within a region as well as provide education and training for health professionals aimed at the prevention of birth defects. At least one of the centers will focus on birth defects among ethnic minorities. Third, the Centers for Disease Control and Prevention [CDC] is directed to be the coordinating agency for birth defects prevention activities. The CDC will serve as a clearinghouse for the collection and storage of data generated from State and regional birth defects monitoring programs. Finally, grants will be available to State departments of health, universities, or other private, or nonprofit entities to develop and implement birth defect prevention strategies, such as programs using folic acid vitamin supplements to prevent spina bifida and alcohol avoidance strategies to prevent fetal alcohol syndrome. Again, when we talk about birth defects, it is important to note that many birth defects are preventable. For instance, we now know that a simple 400 mg dose of the B vitamin folic acid each day could prevent 50 to 70 percent of all cases of spina bifida and anencephaly--saving about $245 million annually and more importantly, saving some families the heart ache that many of us have witnessed friends and families go through. We must broaden public and professional awareness of birth defects and prevention opportunities, and we must have a coordinated national strategy to achieve this goal. The economic and emotional burden of birth defects on families and society as a whole presents a vivid, human picture of the need for a national research and prevention strategy. Although infant mortality in the United States has been falling steadily over the past few decades, 25 other countries have lower infant mortality rates than the United States. This bill is an important step in improving the health of our Nation. The tragedy of birth defects compels our Nation to become a stronger partner for charitable and medical groups in fulfilling our obligation to protect our Nation's most vulnerable population. Let us hope that more tragedies are not necessary to push Congress into action. This legislation has the support of many national organizations, including: the March of Dimes Foundation, the Spina Bifida Association of America, American Academy of Pediatrics, National Association of Children's Hospitals, the National Easter Seals Society, American Association of Mental Retardation, Association of Maternal and Child Health Programs, and the American Hospital Association. The bill also has broad bipartisan support. Let me conclude by taking special note of the help of the National and Missouri March of Dimes, as well as numerous health and child advocate organizations, for their assistance in developing and advocating this legislation. Specifically, I wish to thank Dr. Jennifer Howse, Jo Merrill, and Marina Weiss of the March of Dimes for their persistence and commitment to this endeavor. Mr. President, I send a copy of the bill to the desk and ask unanimous consent that it be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise today to introduce a measure, along with my dear friend and colleague, the chairman of the Environment and Public Works Committee, Senator John Chafee, entitled the Highway Trust Fund Integrity Act of 1997. Our cosponsors are Senators Nickles, Cochran, and Gregg. Mr. President, I hope all of us understand that transportation and highway funding is critical to our individual States and the entire Nation. Good highways link our communities, towns, and cities with markets. They link our constituents with their schools, hospitals, churches, and jobs. An effective transportation system should move us into the 21st century. Back in 1956, the Federal Highway Trust Fund was established as a way to finance the Federal Aid Highway Program. This was to be a dedicated trust fund, supported by direct user fees and taxes. It was called a trust fund because once the money went in, we were supposed to be able to trust that that money would come back out for use on our roads, highways, and bridges. However, the 1990 Budget Act eliminated the linkage between the revenues raised by the user taxes and the spending from the transportation fund. We know now that what we promised ourselves and our constituents, that the highway trust fund user taxes would be deposited and the trust fund would be used for highways, has not been observed. We see now an illogical process that allows highway trust fund dollars not to be spent in order to permit spending more in other categories. I believe that is wrong. My constituents are telling me this is wrong and they have challenged me to find a solution. I believe we have come up with that solution. Let me explain, briefly, Mr. President, what the bill is: First, it is a budget bill, not a tax bill or an ISTEA highway authorization bill. This bill would ensure that the highway trust fund dollars are spent for the purposes for which they were intended and that it would be deficit neutral. The bill would reestablish the link between the highway trust fund taxes and highway spending by transferring the taxes and the spending to a new budget category--a revenue constrained fund-- that is part of the unified budget. This new category would have its own budget rules to ensure that highway programs were fully funded and deficit neutral. This bill would restore the trust to the trust fund because highway spending would equal the highway trust fund taxes collected the prior year. It is consistent with achieving a balanced budget because it comes with its own built-in cap--the revenue received from the highway trust fund. It does not take the highway trust fund off-budget, but it also does not attempt to spend the balances that have accumulated or the interest on those balances. We do not attempt to resolve the arguments of the past. Instead we have focused on developing a workable process for the future. I do not believe that the status quo is sustainable, primarily for two reasons. First, our country has tremendous infrastructure needs. Take my State of Missouri alone. A recent report by the Road Information Program stated that Missouri has the seventh highest percentage of structurally deficient or functionally obsolete bridges in the country, and that more than half of its major roads are in poor or mediocre condition and in need of improvement. My State has the third highest percentage of urban freeway congestion in the Nation, and highway fatalities in Missouri have increased by 17 percent since 1993. These statistics will continue to grow as vehicle travel continues to grow and the infrastructure crumbles. Second, I know that my constituents, and I would say the American public, will not continue to support a process that sentences transportation spending to compete with other discretionary programs despite its unique dedicated funding source. Mr. President, I do not want to take much more time, but there is one more issue I would like to address. Senator Chafee and I have focused on the highway account of the highway trust fund. The bill we are introducing today does not address the mass transit account of the highway trust fund. It is not included due to some concern transit advocates have expressed--not in regards to the budget process being proposed, but over the level of funding that transit receives. I believe it is important that a workable solution be found for transit and I am committed to working with the Banking Committee, which has jurisdiction for the transit programs, and transit advocates in developing a proposal. I want to thank my dear friend Senator Chafee for his leadership in the area of transportation. We will have ample opportunity to continue our work together as the reauthorization of ISTEA progresses. Senator Chafee has heard me 100 times stress the need for a formula change so I will not get into that one today. I do however want to thank him and his staff for their help on this legislation. Mr. President, let me close by saying that this bill is the basis for a transportation funding policy for the future--a starting point for a fairer, more forward-looking transportation funding policy. I hope my colleagues will join us and cosponsor this important bill. Mr. President, I ask unanimous consent that additional material be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise today to introduce a measure, along with my dear friend and colleague, the chairman of the Environment and Public Works Committee, Senator John Chafee, entitled the Highway Trust Fund Integrity Act of 1997. Our cosponsors are Senators Nickles, Cochran, and Gregg. Mr. President, I hope all of us understand that transportation and highway funding is critical to our individual States and the entire Nation. Good highways link our communities, towns, and cities with markets. They link our constituents with their schools, hospitals, churches, and jobs. An effective transportation system should move us into the 21st century. Back in 1956, the Federal Highway Trust Fund was established as a way to finance the Federal Aid Highway Program. This was to be a dedicated trust fund, supported by direct user fees and taxes. It was called a trust fund because once the money went in, we were supposed to be able to trust that that money would come back out for use on our roads, highways, and bridges. However, the 1990 Budget Act eliminated the linkage between the revenues raised by the user taxes and the spending from the transportation fund. We know now that what we promised ourselves and our constituents, that the highway trust fund user taxes would be deposited and the trust fund would be used for highways, has not been observed. We see now an illogical process that allows highway trust fund dollars not to be spent in order to permit spending more in other categories. I believe that is wrong. My constituents are telling me this is wrong and they have challenged me to find a solution. I believe we have come up with that solution. Let me explain, briefly, Mr. President, what the bill is: First, it is a budget bill, not a tax bill or an ISTEA highway authorization bill. This bill would ensure that the highway trust fund dollars are spent for the purposes for which they were intended and that it would be deficit neutral. The bill would reestablish the link between the highway trust fund taxes and highway spending by transferring the taxes and the spending to a new budget category--a revenue constrained fund-- that is part of the unified budget. This new category would have its own budget rules to ensure that highway programs were fully funded and deficit neutral. This bill would restore the trust to the trust fund because highway spending would equal the highway trust fund taxes collected the prior year. It is consistent with achieving a balanced budget because it comes with its own built-in cap--the revenue received from the highway trust fund. It does not take the highway trust fund off-budget, but it also does not attempt to spend the balances that have accumulated or the interest on those balances. We do not attempt to resolve the arguments of the past. Instead we have focused on developing a workable process for the future. I do not believe that the status quo is sustainable, primarily for two reasons. First, our country has tremendous infrastructure needs. Take my State of Missouri alone. A recent report by the Road Information Program stated that Missouri has the seventh highest percentage of structurally deficient or functionally obsolete bridges in the country, and that more than half of its major roads are in poor or mediocre condition and in need of improvement. My State has the third highest percentage of urban freeway congestion in the Nation, and highway fatalities in Missouri have increased by 17 percent since 1993. These statistics will continue to grow as vehicle travel continues to grow and the infrastructure crumbles. Second, I know that my constituents, and I would say the American public, will not continue to support a process that sentences transportation spending to compete with other discretionary programs despite its unique dedicated funding source. Mr. President, I do not want to take much more time, but there is one more issue I would like to address. Senator Chafee and I have focused on the highway account of the highway trust fund. The bill we are introducing today does not address the mass transit account of the highway trust fund. It is not included due to some concern transit advocates have expressed--not in regards to the budget process being proposed, but over the level of funding that transit receives. I believe it is important that a workable solution be found for transit and I am committed to working with the Banking Committee, which has jurisdiction for the transit programs, and transit advocates in developing a proposal. I want to thank my dear friend Senator Chafee for his leadership in the area of transportation. We will have ample opportunity to continue our work together as the reauthorization of ISTEA progresses. Senator Chafee has heard me 100 times stress the need for a formula change so I will not get into that one today. I do however want to thank him and his staff for their help on this legislation. Mr. President, let me close by saying that this bill is the basis for a transportation funding policy for the future--a starting point for a fairer, more forward-looking transportation funding policy. I hope my colleagues will join us and cosponsor this important bill. Mr. President, I ask unanimous consent that additional material be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I thank the Chair. (The remarks of Mr. Bond and Mr. Chafee pertaining to the introduction of S. 404 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')

Mr. BOND

Mr. BOND. Mr. President, I rise today in support of the Mandates Information Act of 1997. I am pleased to be an original cosponsor of this important legislation, and I applaud my distinguished colleague from Michigan, Mr. Abraham, for his leadership in this effort. The bill we are introducing today continues the work begun in the 104th Congress with the enactment of the ``Unfunded Mandates Reform Act of 1995--the 1995 act--authored by Mr. Kempthorne to ensure that Congress is well advised of the cost unfunded mandates would impose on State and local governments. I was a cosponsor of the 1995 act, and I believe the time has come for us to expand its provisions to require similar detailed information and accountability on unfunded mandates affecting the private sector--so we can protect consumers, workers, and small businesses. As chairman of the Senate Committee on Small Business, I am all too aware of the disproportionate burden Federal regulations impose on our Nation's small businesses. A 1995 study found that an average firm with less than 20 employees spent approximately $5,500 per employee in 1992 to comply with Federal regulations--compared with $3,000 per employee by firms with 500 or more employees. The overall cost to the economy is between 6 and 9 percent of gross domestic product--between $420-670 billion--in 1995 dollars--in regulatory compliance. Before we permit the Federal Government to adopt any new mandate that would add to this burden, the Congress needs to be fully informed of the new costs to be imposed on the economy so we can make an informed judgment. The reforms proposed in this bill are needed to ensure that the Congress gives careful and thoughtful consideration to the impact unfunded mandates impose on the private sector. The ability of small businesses to compete and create new jobs can be hindered by unfunded mandates, we need to be aware of the magnitude of any future adverse effects. The Committee on Small Business will continue its work to ensure that the Government's actions here in Washington foster the growth of small businesses located on Main Street. This bill will help to ensure that all Members of Congress are equally informed of the effects a bill would have on the customers, employees, and owners of America's small businesses, the engine of our Nation's economic growth. The legislation Senator Abraham and I are introducing today will ensure that the private sector impact of unfunded mandates is addressed during deliberations on legislation imposing those mandates. Consumers, workers, and small businesses will benefit from the reforms to enhance congressional deliberations on unfunded mandates affecting the private sector. The Mandates Information Act of 1997 establishes a new parliamentary point of order against any bill that will impose private sector mandates exceeding a $100 million cost threshold. The measure directs the Congressional Budget Office to estimate the impact of the proposed unfunded mandates on consumer costs, worker wages, and the availability of goods and services. As with the Unfunded Mandate Reform Act of 1995, the point of order authorized by the bill would bar the House or Senate from further action on a proposed measure unless a majority agrees to move forward with the initiative. By authorizing a point of order triggered by private sector impacts, the legislation introduced today puts teeth into the law to ensure that Congress addresses the costs that would be imposed by the unfunded mandates on small businesses, consumers, and workers. This change requires Members of Congress to go on record as either supporting or opposing an unfunded mandate that would add costs to the private sector. With the aid of a consumer, worker, and small business impact statement, Members of Congress will have the information required to make an informed decision on the merit of imposing a mandate without also providing funding for compliance. The impact statement would be prepared by the Congressional Budget Office--which the bill directs to estimate the economic impact of a proposed mandate on consumers, wages, and the availability of goods and services. All in all, this bill is about good governance. It provides information to ensure that Congress is fully informed on the impact of an unfunded mandate on the economy and the private sector in particular. By tasking the Congressional Budget Office with preparing an impact statement, the bill also provides important information to educate Congress on the effect of pending legislation. This, in itself, is an important step toward ensuring that the needs and concerns of small businesses, and the workers and customers that depend on small businesses, are given the attention they deserve by Congress. As with the Small Business Regulatory Enforcement Fairness Act of 1996--or the Red-Tape Reduction Act as I prefer to call it--today's bill seeks to ensure that the Government treats small business fairly. The Mandates Information Act has the support of the National Federation of Independent Business, the National Restaurant Association, the U.S. Chamber of Commerce, the National Retail Association, the National Association of Wholesaler-Distributors, and the Small Business Survival Committee--I urge my colleagues to join our efforts to enact this bill and enhance our efforts to ensure good governance.

Mr. BOND

Mr. BOND. Mr. President, I rise today in support of the Mandates Information Act of 1997. I am pleased to be an original cosponsor of this important legislation, and I applaud my distinguished colleague from Michigan, Mr. Abraham, for his leadership in this effort. The bill we are introducing today continues the work begun in the 104th Congress with the enactment of the ``Unfunded Mandates Reform Act of 1995--the 1995 act--authored by Mr. Kempthorne to ensure that Congress is well advised of the cost unfunded mandates would impose on State and local governments. I was a cosponsor of the 1995 act, and I believe the time has come for us to expand its provisions to require similar detailed information and accountability on unfunded mandates affecting the private sector--so we can protect consumers, workers, and small businesses. As chairman of the Senate Committee on Small Business, I am all too aware of the disproportionate burden Federal regulations impose on our Nation's small businesses. A 1995 study found that an average firm with less than 20 employees spent approximately $5,500 per employee in 1992 to comply with Federal regulations--compared with $3,000 per employee by firms with 500 or more employees. The overall cost to the economy is between 6 and 9 percent of gross domestic product--between $420-670 billion--in 1995 dollars--in regulatory compliance. Before we permit the Federal Government to adopt any new mandate that would add to this burden, the Congress needs to be fully informed of the new costs to be imposed on the economy so we can make an informed judgment. The reforms proposed in this bill are needed to ensure that the Congress gives careful and thoughtful consideration to the impact unfunded mandates impose on the private sector. The ability of small businesses to compete and create new jobs can be hindered by unfunded mandates, we need to be aware of the magnitude of any future adverse effects. The Committee on Small Business will continue its work to ensure that the Government's actions here in Washington foster the growth of small businesses located on Main Street. This bill will help to ensure that all Members of Congress are equally informed of the effects a bill would have on the customers, employees, and owners of America's small businesses, the engine of our Nation's economic growth. The legislation Senator Abraham and I are introducing today will ensure that the private sector impact of unfunded mandates is addressed during deliberations on legislation imposing those mandates. Consumers, workers, and small businesses will benefit from the reforms to enhance congressional deliberations on unfunded mandates affecting the private sector. The Mandates Information Act of 1997 establishes a new parliamentary point of order against any bill that will impose private sector mandates exceeding a $100 million cost threshold. The measure directs the Congressional Budget Office to estimate the impact of the proposed unfunded mandates on consumer costs, worker wages, and the availability of goods and services. As with the Unfunded Mandate Reform Act of 1995, the point of order authorized by the bill would bar the House or Senate from further action on a proposed measure unless a majority agrees to move forward with the initiative. By authorizing a point of order triggered by private sector impacts, the legislation introduced today puts teeth into the law to ensure that Congress addresses the costs that would be imposed by the unfunded mandates on small businesses, consumers, and workers. This change requires Members of Congress to go on record as either supporting or opposing an unfunded mandate that would add costs to the private sector. With the aid of a consumer, worker, and small business impact statement, Members of Congress will have the information required to make an informed decision on the merit of imposing a mandate without also providing funding for compliance. The impact statement would be prepared by the Congressional Budget Office--which the bill directs to estimate the economic impact of a proposed mandate on consumers, wages, and the availability of goods and services. All in all, this bill is about good governance. It provides information to ensure that Congress is fully informed on the impact of an unfunded mandate on the economy and the private sector in particular. By tasking the Congressional Budget Office with preparing an impact statement, the bill also provides important information to educate Congress on the effect of pending legislation. This, in itself, is an important step toward ensuring that the needs and concerns of small businesses, and the workers and customers that depend on small businesses, are given the attention they deserve by Congress. As with the Small Business Regulatory Enforcement Fairness Act of 1996--or the Red-Tape Reduction Act as I prefer to call it--today's bill seeks to ensure that the Government treats small business fairly. The Mandates Information Act has the support of the National Federation of Independent Business, the National Restaurant Association, the U.S. Chamber of Commerce, the National Retail Association, the National Association of Wholesaler-Distributors, and the Small Business Survival Committee--I urge my colleagues to join our efforts to enact this bill and enhance our efforts to ensure good governance.

Mr. BOND

Mr. BOND. Mr. President, today I rise to introduce a measure on behalf of myself, Senator Ashcroft, and Senator Byrd which would prohibit permanently the use of Federal funds for human cloning research. I am sure most Americans by now have heard about the successful cloning of Dolly, the sheep, by Scottish scientists. Many people are now asking can similar techniques be used to clone a human being? Something that was once thought to be only science fiction is now close to being a reality. With the legislation I introduce today, I intend to make sure that human cloning stays within the realm of science fiction and does not become a reality. The bill that I am introducing with my colleagues today will place a permanent ban on Federal funding for human cloning or human cloning research. We must send a clear signal: Human cloning is something we cannot and should not tolerate. This type of research on humans is morally reprehensible. We should not be creating human beings for spare parts or as replacements. Moreover, a National Institutes of Health human embryo panel noted, ``allowing society to create genetically identical persons would devalue human life by undermining the individuality of human beings.'' In a September 1994 report of the Human Embryo Research Panel, the heading is, ``Research Considered Unacceptable for Federal Funding.'' It said: Four ethical considerations entered into the deliberations of the panel as it determined what types of research were unacceptable for Federal funding: The potential adverse consequences of the research for children, women and men; the respect due the reimplantation embryo; concern for public sensitivities in highly controversial research proposals, and concern for the meaning of humanness, parenthood, and the successions of generations. The President has said we should study the issue. President Clinton has asked a Federal bioethicist board to consider the implications of this research and report back to him within 90 days. I do not think we need to study this. I think we can save the board some effort because the President's own administration has concluded that human cloning was ``research considered unacceptable for Federal funding.'' There are some aspects of life which simply ought to be off limits to science. I think it will be helpful to go through some of the ethical considerations the board looked at. First, they asked: Is it ethical to create genetically identical individuals who can be born at different times? Is it ethical to store a frozen human embryo that is genetically identical to a born child in order to serve as a later source for organ and tissue transplantation; thus treating humans as spare parts? Is it ethical to create a genetically identical child as a replacement in case the first child dies? Again, these are just a sample of the ethical questions the issue poses. The board concluded the analysis by stating: There are broad moral concerns about the deliberate duplication of an individual genome. The notion of cloning an existing human being or of making ``carbon copies'' of an existing embryo appears repugnant to members of the public. Many Members of the panel share this view and see no justification for Federal funding of such research. I also should point out an important distinction with this bill. It is narrowly drafted so that it only affects human cloning research. It does not address the issue of plant and animal cloning research, and it will also allow--and I personally strongly support--NIH to continue its human genome mapping project. I have long been a supporter of biotechnology, genome mapping and manipulation, and even plant and animal cloning. But we can draw a clear line here. For plants and animals, it makes sense to clone your specimens to improve human health and human well-being. But when we are talking about creating an entire human being, identical to another, we are talking about playing God, and that is where we must draw the line. I note, the Vatican and leading ethicists throughout the country have called for a ban on human cloning and human cloning research. I ask unanimous consent that the names of those ethicists and scientists be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I thank the distinguished manager of the bill. I have asked for this time to spend about 5 minutes to introduce a piece of legislation, so, while it will count against the time, I ask unanimous consent to be permitted to proceed as in morning business for that 5-minute period.

Mr. BOND. I thank the Chair. (The remarks of Mr. Bond pertaining to the introduction of S. 368 are located in today's Record under ``Statements on Introduced Bills and Joint Resolutions.'')