Kit Bond

Mr. BOND

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 President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. BOND. Mr. President, I suggest the absence of a quorum.

Mr. BOND. Mr. President, on behalf of the leader, I ask unanimous consent that the Senate remain in a period of morning business with Senators speaking for up to 10 minutes each, with the following exceptions: Senator Durbin or his designee will control the floor from 11 to noon and from 1 to 2 p.m.--and I ask within that timeframe, if no one seeks the floor, I may be recognized to introduce a bill--and Senator Thomas or his designee will control the floor from noon to 1 p.m. and from 2 to 3 p.m.

Mr. BOND

Mr. BOND. Mr. President, in 1997 Congress made an important change in the tax code for small businesses by restoring the home-office deduction. That change opened the door for millions of Americans to operate successful small businesses from their homes. Now the home- based financial planner or landscape can use an extra bedroom or a basement to conduct her business without the cost of commercial office space. In many cases, these home offices also allow today's entrepreneurs to spend more time with their family by avoiding the added time and expense of day-care and commuting. With the restoration of the home-office deduction, however, came a significant new complexity for home-based businesses, depreciation recapture. If a home-based medical transcriber elects to claim the home-office deduction, she will deduct the expenses relating to her home office, such as a portion of her home-owners insurance, utilities, repairs, and maintenance. She is also entitled to depreciate a portion of the cost of her house relating to the home office. But there is a big catch. When the home-based business owner sells her home, she must recapture all of the depreciation deductions and pay income taxes on them, even though her house qualifies for the exclusion from tax for the sale of a principal residence. The specter of depreciation recapture has several significant ramifications. First, it requires additional recordkeeping for home- based business owners, on top of the enormous burdens that the tax code already imposes on a small business. Second, when the home-based business owner decides to sell his home, he must struggle with the complexities of calculating the depreciation recapture or, as is too often the case, he must hire a costly tax professional to undertake the calculations and prepare the required tax forms. Additionally, the depreciation-recapture requirement creates a disincentive for home-based business owners to claim the home-office deduction in the first place. In fact, I have heard from accountants and tax advisors in my home State of Missouri that they frequently advise their clients to forego the home-office deduction simply to avoid the recordkeeping and complexities associated with recapturing the depreciation. That is clearly not what Congress intended when it restored the home-office deduction in 1997. In light of this problem, I rise today to introduce the ``Home-Office Deduction Simplification Act of 2001.'' This bill simply repeals the depreciation-recapture requirement and the disincentive for home-based businesses to utilize the home-office deduction. At a time when the Nation's small businesses are feeling real pain from the current economic slow down, this bill will provide real relief, not only when they sell their homes, but today by giving them the benefit of the home-office deduction that Congress intended. It is my pleasure to be working with Congressman Donald Manzullo, Chairman of the House Committee on Small Business, to raise this issue in both Chambers. I urge my colleagues in the Senate to support this legislation and make the home-office deduction as simple and accessible as possible. Our home-based businesses across the nation deserve nothing less. I ask unanimous consent that the text of the bill and a description of its provisions be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, in 1997 Congress made an important change in the tax code for small businesses by restoring the home-office deduction. That change opened the door for millions of Americans to operate successful small businesses from their homes. Now the home- based financial planner or landscape can use an extra bedroom or a basement to conduct her business without the cost of commercial office space. In many cases, these home offices also allow today's entrepreneurs to spend more time with their family by avoiding the added time and expense of day-care and commuting. With the restoration of the home-office deduction, however, came a significant new complexity for home-based businesses, depreciation recapture. If a home-based medical transcriber elects to claim the home-office deduction, she will deduct the expenses relating to her home office, such as a portion of her home-owners insurance, utilities, repairs, and maintenance. She is also entitled to depreciate a portion of the cost of her house relating to the home office. But there is a big catch. When the home-based business owner sells her home, she must recapture all of the depreciation deductions and pay income taxes on them, even though her house qualifies for the exclusion from tax for the sale of a principal residence. The specter of depreciation recapture has several significant ramifications. First, it requires additional recordkeeping for home- based business owners, on top of the enormous burdens that the tax code already imposes on a small business. Second, when the home-based business owner decides to sell his home, he must struggle with the complexities of calculating the depreciation recapture or, as is too often the case, he must hire a costly tax professional to undertake the calculations and prepare the required tax forms. Additionally, the depreciation-recapture requirement creates a disincentive for home-based business owners to claim the home-office deduction in the first place. In fact, I have heard from accountants and tax advisors in my home State of Missouri that they frequently advise their clients to forego the home-office deduction simply to avoid the recordkeeping and complexities associated with recapturing the depreciation. That is clearly not what Congress intended when it restored the home-office deduction in 1997. In light of this problem, I rise today to introduce the ``Home-Office Deduction Simplification Act of 2001.'' This bill simply repeals the depreciation-recapture requirement and the disincentive for home-based businesses to utilize the home-office deduction. At a time when the Nation's small businesses are feeling real pain from the current economic slow down, this bill will provide real relief, not only when they sell their homes, but today by giving them the benefit of the home-office deduction that Congress intended. It is my pleasure to be working with Congressman Donald Manzullo, Chairman of the House Committee on Small Business, to raise this issue in both Chambers. I urge my colleagues in the Senate to support this legislation and make the home-office deduction as simple and accessible as possible. Our home-based businesses across the nation deserve nothing less. I ask unanimous consent that the text of the bill and a description of its provisions be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I rise to make a few comments to congratulate the Mary Harmon Weeks Elementary School in Kansas City, Missouri, on receiving 3rd place in the 18th ``Annual Set a Good Example School Competition.'' The ``Set a Good Example Campaign'' is popular with students and teachers alike because it motivates, recognizes and awards student- designed and run projects. It has proven to be a very successful and inspirational method for pulling together business people, educators, youth counselors, parents and students behind the effort to eradicate illegal drugs, crime and violence from our nation's schools. The students at Mary Harmon Weeks Elementary School successfully put to work 21 precepts from a common sense moral code booklet titled The Way to Happiness including, ``Try to treat others as you would want them to treat you.'' I would like to applaud the students of Mary Harmon Weeks Elementary School and their teacher Gilbert Lowe for the outstanding accomplishment. Sometimes it is very hard for young people to stand out from the crowd and not give in to peer pressure. The choices the students at Mary Harmon Weeks Elementary School have made to stay away from drugs and to promote a safe school environment is a mature and responsible decision. It will not only benefit them as individuals but will bring numerous benefits to the school and community as well.

Mr. BOND

Mr. BOND. Mr. President, I rise to make a few comments on the retirement of Carol Hurt and her 25 years of dedication to Missouri. On June 1, 2001, Carol Hurt will retire from the State of Missouri. Her long and varied career has spanned more than 25 years, beginning at the Department of Revenue in 1976. Since then she has held the position of Assistant Director of Administration in the Attorney Generals office and Director of Administration in the State Auditors office. As Governor, I had the privilege to work with Carol Hurt when she was Office Manger for the Governor's office, as did my successor John Ashcroft. Carol currently serves as a member of the Professional Advisory Board for the Business and Public Administration department for the University of Missouri, the Missouri Institute of Public Administrators and the Association of Governmental Accountants. She has also served the community as a board member for the Greater Missouri Women's Leadership Foundation, Homemaker Heath Care and Rotary International. Carol will complete her distinguished career of dedication and service at the Missouri Department of Transportation where she is a Senior Human Resource Specialist. I would like to thank Carol Hurt for her commitment to the state of Missouri and for all her hard work. I join with her family, friends, and colleagues in congratulating her on this outstanding accomplishment and wish her the best in all her future endeavors.

Mr. BOND

Mr. BOND. I move to lay that motion on the table. The motion to lay on the table was agreed to. Amendment No. 756 (Purpose: To require the Secretary of the Treasury to adjust the reduction in the highest marginal income rate if the discretionary spending level is exceeded in fiscal year 2002)

Mr. BOND

Mr. BOND. Mr. President, I rise to make a few comments on the sesquicentennial anniversary of Christ Episcopal Church in St. Joseph, MO. The first formal service of the Episcopal Church was held in the orchard of Mrs. Kate Howard's home at 5th and Francis on September 1, 1851. The Reverend John McNamara, Missionary to the Platte Purchase, celebrated the service. On April 14, 1852, Christ Church parish was organized and the small group purchased a log structure at the northwest corner of 3rd and Jules. On July 30, 1877 Bishop Robertson of the Diocese of Missouri laid the cornerstone of the new church. The building is brick in the English Gothic style. It is the second oldest building in the city in continuous use as a place of worship by one congregation. During the 1896 renovation an organ was purchased from a church in Connecticut. This Johnson organ was originally built in 1867. The women of the parish who sponsored three operettas at the Tootle Opera House raised the money for the organ. The original portion is the oldest organ in St. Joseph. Christ Episcopal Church continues to be a presence in downtown St. Joseph. The members are involved in community outreach activities including the Open Door Food Kitchen, Downtown Partners Association, Ecumenical Corporation for Housing Opportunities, and a Mother's Day Baby Shower to benefit the Division of Family Services. I commend the congregation of Christ Episcopal Church on their continued commitment to maintain high standards of worship, music and fellowship for a church of 220 parishioners. I am pleased to join with the St. Joseph community and the State of Missouri in congratulating the congregation and wishing them continued growth and success for the next 150 years.

Mr. BOND

Mr. BOND. Mr. President, studies and reports have shown that PAT children at age 3 are found to be significantly more advanced than comparison children in language, problem solving, and social development. Often, through participation in PAT, learning problems or development delays are identified and treated early. PAT parents are more confident in their parenting abilities and knowledge. The great thing is, PAT hooks parents early on which means that they are more likely to stay involved in their children's schooling. We all know that we can have all the programs in the world and can provide all the funding possible, but one of the main ingredients to a child's success in school is the involvement of the child's parents in the child's education. As I said, earlier this year I received a copy of a report from the Missouri Department of Elementary and Secondary Education. The report was the ``School Entry Assessment Project''. The summary of findings reinforced my interest, support, and commitment to PAT. The findings of the report are as follows: 1. When Parents as Teachers is combined with any other pre- kindergarten experience for high-poverty children, the children score above average on all scales when they enter kindergarten. 2. The highest performing children participate in PAT and preschool or center care. Among children who participate in PAT and attend preschool, both minority and non-minority children score above average. Children in both high-poverty and low-poverty schools who participate in PAT and attend preschool score above average when they enter kindergarten. 3. Among children whose care and education are sole home- based, those whose families participate in PAT score significantly higher. 4. Special needs children who participate in PAT and preschool in addition to an early childhood special education program are rated by teachers as being similar in preparation to the average child. 5. Head Start children who also participate in PAT and another preschool score at average or above when they enter kindergarten. This findings sum it all up. PAT works. PAT works for children raised in household of all income levels. PAT works for children who are home- schooled. PAT works for our special needs children. My amendment makes certain that priority is given to programs such as PAT and other early childhood parent education programs. With that, Mr. President, I urge my colleagues to support this amendment. I yield the floor. Amendment No. 425, As Modified

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

Mr. BOND. I ask the pending amendment be set aside.

Mr. BOND. Mr. President, I call up amendment No. 476 and send a modification to the desk.

Mr. BOND. I ask unanimous consent the reading of the amendment be dispensed with.

Mr. BOND. Mr. President, I understand my colleague from Rhode Island has requested 5 minutes. I intend to do this briefly. But I think it is very important that we consider this issue. I believe the amendment can be accepted on both sides to make sure that we deal properly with early childhood education. I have come to this Chamber many times to state that research has now verified what parents have known instinctively for generations, and teachers will tell us time after time that the first years of life are absolutely crucial development periods for children. How well the parent handles that early time with the child will determine how well that child performs in school later on. Infant brain development occurs very rapidly. The sensations and experiences of this time go a long way toward shaping the baby's mind in a way that has long-lasting effects on all aspects of the child's life. We have learned in Missouri from a program called Parents As Teachers that we can assist parents and families to be better in playing this role that is key to the child's development. Early positive interaction between parents and guardians plays a critical role. A child's education and mental development begin very early in life. Through this amendment, we seek to ensure the continued support of families with the youngest children to find the early childhood parent education programs that can help those families and parents provide supportive, stimulating environments we know all children need. We must focus on the earliest years before formal schooling. We know that half of the child's mature intelligence develops in those first critical 3 years. This amendment provides no new money. All the amendment does is clarify that the early childhood and early childhood parent education is to be a key focus of title VI, Part A. I have talked about the Parents As Teachers Program that really was developed in Missouri. I managed to carry it statewide when I was Governor. One of the great successes is that it now has over 150,000 families in Missouri, with 200,000 children benefiting from it. If you want to find out whether it is working, I just ask that you go and talk to the parents who have been in the program. They are the ones who can tell you it works. We have scientific assessments that show it works. The PAT, the Parents As Teachers, is an early childhood-parent education program that empowers all parents--regardless of income level, regardless of social condition--to give their children the best possible start in life. We have programs now in all 50 States and in 6 foreign countries. It provides information to parents on child development from birth to age 5. It has voluntary participation. It is tailored to meet the needs of each parent, and it is often included as part of Even Start and other title I programs. We have found it works very well with Head Start. The PAT Program benefits the children, but it also helps the parents develop the confidence to take an active role in their children's education. Earlier this year, I received a report from the Missouri Department of Elementary and Secondary Education: The School Entry Assessment Project. The findings throughout are that the highest performing children in schools are the ones whose parents have participated in Parents As Teachers. It further shows that special needs children who participate in Parents As Teachers in preschool, in addition to an early childhood special education, are rated by teachers as being similar in preparation to the average child. These findings sum it all up. Parents As Teachers works. It works for children raised in households of all income levels. It works for children who are home schooled. It works for children with special needs. My amendment makes certain that priority is given to these programs, such as Parents As Teachers, HIPPY, and others. For any of my colleagues who would like a fuller description of it, I happen to have a few pamphlets available. You can contact my office, and I will provide you with that. Mr. President, I ask unanimous consent that a 2-page summary of the evaluation of Parents As Teachers be printed in the Record.

Mr. BOND

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

Mr. BOND. Mr. President, as we begin this critical week with debate on the education bill, I wanted to make some points that I think apply throughout the debate on education, and I wanted to share with my colleagues some of my hopes, aspirations, and concerns. I thank the manager on the minority side for allowing us to do so.

Mr. BOND. I thank the manager. Mr. President, there have been numerous times that I have come to the Senate floor to say--and I come, once again, to repeat--that education is a national priority, but it is an obligation and responsibility of those at the State and local level. The education of our children has traditionally been--and ought to be in the future--carried out and implemented at the local level. I remember a couple of years ago when we were talking about Federal control that one of my colleagues, who is now no longer with us, was in a debate with a representative in the Department of Education. The Department of Education person said: I care just as much about your children and their needs and their operations in school and their success as you do, to which he replied: Well, that's great. Do you know their names? No. Do you know what their scores are? No. Do you know what their challenges are? No. Do you know where their schools are? No. The simple fact is that none of us here in Washington, no matter how much we are concerned about education in general and children in general, can know what the problems are and what the challenges are and how best to meet those challenges for students in each local school district throughout this Nation. I think we would all say that each child is different. Each school district is different. Each school is different. I think for that and other good reasons the Federal role in education has been a limited one, and I believe it should be. The underlying bill before us--S. 1--recognizes the nature and the scope of this role. The legislation creates a leadership role for the Federal Government in encouraging States to adopt commonsense systems based upon standards, measurements, and accountability. The underlying bill as reported out of our committee did not attempt to micromanage the local schools and classrooms. S. 1 also would give us the opportunity to redefine how we measure success. For too long, many of my colleagues here have supported throwing more and more money at education. And the Washington-based education establishment generally has determined our success in education programs based on the dollars spent--not on the academic achievements, not on the progress, and not on what our children are learning in school to be better prepared for their role in this increasingly complex and competitive society. If more money were the answer, we wouldn't be debating this bill because we wouldn't have the problem. We have poured more and more Federal money into education, and the academic achievement of our students has been level or in some cases it has fallen behind. In pouring more money into public education, we have gone to great lengths to detail precisely how those teachers--the men and women who know the names of the child in their classroom, and know what his or her problems are, more and more they are being told what to do by Washington. According to the Education Commission of the States: In the 1999-2000 budget, the federal government spent almost $44 billion on elementary and secondary education programs. This funding was spread across 35 different education programs in 15 different federal departments. We did a little research a couple years ago and found out there are over 760 education programs. It was that proliferation of good ideas from Washington that led me at the time to propose what we call the Direct Check For Education, to combine some of those biggest programs, cut the redtape, send it back to the school districts, and tell the school districts these are all things we think you ought to consider but do not require them to dot every i and cross every t, jump through the hoops, and fill out forms and fill out reports and play ``Mother May I'' with the Federal Government. All of these programs that exist today were started with good intentions, and they have gotten more money. Look at the money. Shown on this chart are the appropriations for ESEA programs in billions of dollars. Starting in 1990, it looks as if, oh, around $7 billion was spent, and now it has gone up to, oh, I would say close to $380 billion. This shows what has happened in the average national scale math scores for 9-year-olds. That is measured on the chart with the green line. It is a flat line. If that were a line on a key chart in a hospital measuring the heartbeat of the patient, it would say the patient is dead. All the money has produced no appreciable benefits. That is the math scores. Maybe we can look at another chart to see if we got any better results. How have we done in reading? This chart has the appropriations for ESEA programs in billions of dollars. It is the same type of chart as the last one. It shows the national 4th grade reading scores: a flat line, no life in the patient. We are not getting any better. We are spending more money to do no better. I am afraid we are about to hijack S. 1 and turn it into a replay of the same kind of Federal micromanagement and Federal direction of education that has managed to use a whole lot of money without getting any results. These Federal programs--the Education Commission of the States says 35; I say over 760--have gotten us burdensome regulations, unfunded mandates, and unwanted meddling. The folks at the local level--whether they be parents or teachers or school board members or administrators-- say they have less and less control. Jobs of our teachers and administrators are harder than they should be. We have eroded the opportunity for creativity and motivation. I don't know how many of you have taken the opportunity to do what I have done in Missouri. Over the last 3 years, I have traveled throughout the State--in the metropolitan areas, the suburban areas, the rural areas--and I have met with representatives of teachers, of school board members, of administrators. I have asked: What is the problem here? And too many of them have come back to say: We are spending our time as glorified grantsmen, trying to get more money from the Federal Government, trying to jump through the hoops, trying to do what the Federal Government wants us to do. We don't have the time to prepare our lessons and to prepare our students for the education they need for a lifetime. This is a serious problem. This is what the teachers, the administrators, the school board members are telling us throughout my State. It comes through loud and clear, and it is on a bipartisan basis. From the most conservative Republicans to the most liberal Democrats, the people in Missouri, who are involved at the local school level, tell us there is far too much time, effort, and energy wasted on complying with Federal dictates, Federal mandates. Some of our schools say that, although the Federal Government only provides an average of about 5 percent--I guess in Missouri it is a little less than the national average of the dollars going to education--it, in effect, controls about 50 percent of what is done because these Federal mandates and these Federal dictates--all these good ideas that went into these programs--tell the local schools how they ought to handle the programs they would otherwise be doing to educate their kids. And most of them say, well over 50 percent of the redtape and the headache and the requirements and the hassle they go through comes from the Federal Government. How can we afford to keep spending Federal education dollars in the same way we have been doing it for years if it is not achieving any success? I do not think we can. I do not think we should stand for it. I have talked to too many parents and teachers, school board members, community and business leaders who say: Our children deserve better. This country deserves better. Over the past several years, I have opposed the creation of specific new programs and their dictates on the style of their education, even these amendments that have been offered in good faith. These amendments were good ideas, if we had taken our good ideas and ran for membership on a school board. I am sure many of my colleagues could make great contributions if they were on the school board in Mexico, MO, or the R- 6 school district or the St. Louis city school board or the Jefferson City school board, but we are not. The problem is, there are different needs and different challenges in Missouri, in Washington, in Arizona, in Maine, or in Florida. When we pass a law, when we pass a dictate or a requirement, we do not know how that is going to impact the kids who are the ones who have to be taught. We may understand education in general, but there are educational needs that are specific and direct in each school district as the individual student involved. I cannot believe, if my colleagues went back home, spent some time, saddled up the horses, went out and just rode the circuit, that you wouldn't hear the same things. I know, first hand. Our State has some of the best teachers, the best principals, superintendents, and school board members in the country. They are outstanding people. They are really concerned. You think we are concerned about education. Well, we were concerned about education last week and will be this week, but we have to be concerned about the budget, we have to be concerned about tax policy, and we are going to be concerned about energy policy. These dedicated men and women are spending their lifetime dedicated to one thing; that is, teaching our children. What do the people who are actually involved in education have to say? The superintendent of Springfield, MO, public schools said: . . . the amount of paperwork that the federal government causes local school districts to engage in is often overwhelming. The extra effort and time often reduces productive classroom time and energy that could better be spent working directly with children. Mr. Berrey of the Wentzville R-IV school said: Limiting federal intrusion into decisions best left to local communities is what I believe our founding fathers had in mind. From the Neosho, MO, R-5 school district: The individuals who are working most closely with the students are indeed the ones who can best decide how this money can be spent for the benefit of students' education. The superintendent of the Special School District of St. Louis County said: As head of a school district specializing in special education, I fully understand how my district's financial needs differ from other school district's needs. In order to best utilize the limited funds that are at my disposal, I need maximum flexibility in determining how to put those funds to the best use. The president of the board of education of the Blue Springs, MO, school district said: Without local control, the focus is taken away from the needs specific to the children in each school system. But I think maybe the superintendent of the Taneyville, MO, R-II school district sums it up well: I feel that State and Federal government has tied our school's hands with mandated programs and mandated uses for the monies we are receiving. The schools are likened to puppets on a string. Pull this string this way and the school does this; pull it another way and the school does that. School systems and communities are as different from one another as individual people are different. What works for one will not work for another. I offer those because that is the kind of information all of us need as we move forward on any kind of education bill, certainly one as important as the reauthorization of the Elementary and Secondary Education Act. My colleagues haven't been in a position to listen to those people and ask them questions directly, but I suggest to them, if they go home and ask questions, they will hear the same, with similar eloquence and similar heartfelt concern, in their States. To me the issue is simple: We must give our States and localities the flexibility to utilize the limited amount of Federal resources as they see fit and hold them accountable in the form of academic achievement. We must recognize and reward States and localities that succeed in improving academic achievement. There also should be consequences for States and localities that fail. We have a choice between having Washington, DC, control our schools and the local level. Who is most likely to waste money? There is no contest there. Unfortunately, we have demonstrated in Washington collectively that no matter how good our ideas, how well intentioned our efforts are to provide direction and counseling and hope for schools, we may not be doing the right job; we may be causing them more problem. A little girl hustling to school--she was late for school--said a little prayer that she would get to school on time. She went about another half block and got going too fast and fell down on her face. She offered up another little prayer: I would like you to help me to get to school, but don't push so hard. I fell down. Sometimes we are pushing a little too hard. Sometimes what we try to do to help the people who are trying to deliver education try to uplift and empower our children pushes them down on their face. I think it is time that we consolidate those programs, that we take all these great revenues and give parents a say. Let school boards determine the policy, let administrators know how to run their school, and let teachers who know the names and the problems and the opportunities and the potential of each child make those educational decisions. S. 1, the underlying bill, consolidates a myriad of Federal programs into a set of programs designed to allow States and local school districts to make decisions on their own, to determine their priorities, recognizing that education reform will take place in the classroom, not because of all of the wonderful, great ideas we have in Washington, DC. The underlying concept of S. 1 is the right way to go. Amendments on class size are absolutely unnecessary. Class size reduction is an option in S. 1's larger, more flexible program for improving the quality of classroom teaching. It should be an option, not a mandate. Let me ask this question: Has it been shown that a fifth grade class must have only so many children in it to be successful? I have talked to a lot of administrators who say the most important thing for teaching that fifth grade class and each child in it is to make sure the quality of the teacher is good. If we can't come up with two quality teachers, all we do, in splitting up the class, is say to those children who go with a less qualified teacher that they don't get as good an education. What if the school district has already devoted its money to reducing class size, used its local funds? What they need is better pay to keep those teachers there. On classroom funding, are we going to say: You can only use this money to hire more teachers? What if the principal said: I have some great teachers, but they are going to go into the private sector if I don't give them a pay increase? How does that make sense for us to say to every school district in the Nation: Thou shalt hire more teachers? It doesn't make sense to me. Local school districts are best equipped to determine what they need. Many have already reduced class size where they thought necessary. They might have done that at the expense of some other things: Teacher pay, technology, class books. Maybe they need professional development for the teachers they have. How do we know? I will guarantee you, we don't know. We can't know for every school district in the Nation. That is why we ought not be mandating that Federal dollars be spent for a purpose that may or may not be the top priority need of that district. Mandating specific resources for class size reduction really takes money off the table for other schools that have already addressed that specific issue. As I said earlier, they may have decided that professional development for their teachers to improve the quality of teaching is more important to obtain academic success for the students and schools. We always deal with limited budgets. There is not going to be an unlimited source of money going into anything we need. The question is how best we spend the money we have. All of us agree that a good, quality education is our top national priority. We can't say we are going to have all the specific programs and we are going to meet every need of every school district because State and local funds still cover at least 90 percent--in most States more--of education funding. We are not going to replace that. We shouldn't because we didn't run for this office to be a national school board. The President and the Secretary of Education are men deeply committed to education, but they are not good superintendents of schools or principals or even teachers, in this instance, because they have to deal with all the schools and they can't know all the kids' names. The American public is and should be interested in the debate in Washington because they overwhelmingly believe that good education for our children is a top priority. But they also know what really matters is what goes on in the schools and the classrooms around the country. As much as we like to argue among ourselves, what is said in this Chamber or even in the other body is not going to drive the education of a student or make sure that student is better educated. That depends upon a teacher and the school in which that child studies. Individuals on one side of this debate believe that the Olympians on the hill, those of us in Washington with fine titles, those of us with national responsibilities in the Congress or those in the Education Department, a group of very concerned individuals, know what is best for the folks down in the valley. I happen to be on the side who believe that the great ideas, the accomplishments, the successes that are going to make our children better educated for the future, that are going to help them meet the challenges of this wonderful but challenging century are going to be made by the folks in the valley, the men and women who staff our schools, who are the teachers, administrators, superintendents, principals who run the school boards, and who are the parents who, above all, are the ones with the greatest stake in the education of their children. I hope this body does not hijack S. 1 and make it into another system of categorical grants: Jump through this hoop and you will get some dollars. But then you will have to fill out reports and check in with Washington to see how you used them, and then you will have to file more reports, or you can jump through this hoop if you make a successful application. And if you jump through the right hoops and somebody in Washington agrees that it is OK, then you have to follow up with more reports and redtape and forms and tell them what you did. I don't think that is the way we ought to be going on education. I urge my colleagues, as we look at these amendments before us, to ask these basic questions: Is this amendment or provision going to enable somebody who is teaching children in a school in my State to do a better job? Is it going to be across the board? Is it going to enable every teacher in every school district? Or is it only going to affect a few school districts, where our priority happens to be that school's priority? Mr. President, I urge my colleagues to rethink how we are going in terms of setting up too many hoops for schools to jump through. We want to see better education, but Federal hoops are not the way to get there. I thank the Chair and yield the floor.

Mr. BOND

Mr. BOND. Mr. President, today I offer a bill to take a successful pilot program at the Department of Defense, make it permanent, and extend it governmentwide. For the past decade, DOD has had a program in place to try to develop and maintain small business vendors as a vital part of our Nation's defense industrial base. This program, the Mentor- Protege program, has also been a principal source of opportunity for small business, to offset some of the other Federal procurement practices that have squeezed small business out of contracting. Those two goals, the enhanced vendor base and improved opportunity, are worth emphasizing before I discuss the specific provisions of this bill. Why is small business participation in contracting important? Far too often, small business is seen as just another social or economic development program. In Federal contracting, however, it is much more than that. Small business is a critical, vital, indispensable part of our nation's preparedness for its defense. We have been working here in the Senate toward trying to shore up our defense preparedness. For the better part of a decade, DOD has had more and more missions with fewer and fewer resources. Now that we are trying to overcome this neglect with additional funding, we must also ensure that our economic base is strong, as well. It will do little good to have the money to buy defense-related goods and services if there are no vendors available to sell them. The DOD Office of Small and Disadvantaged Business Utilization has an excellent slogan that drives this point home. ``Small Business: A Readiness Multiplier.'' So, keeping small business involved in contracting is a matter of self-interest for our Nation. It is a matter of having the goods, the services, the resources for the warfighter to take into battle. Second, small business must have access to contracting as a matter of economic opportunity. The Government is an enormous customer. It averages about $180 to $190 billion worth of contracting every year. No one else has that kind of presence in the marketplace. If the Government spends the lion's share of its money on a handful of large insider corporations, it distorts the marketplace. It tends to give unfair advantage to the winning firms, purely because of the Government's enormous purchasing power. To avoid harming our economy with that kind of market distortion, the small business program seeks to disperse Government contracts among a variety of vendors. The small business program is not so much an intervention in the economy as it is a dilution of the distortion that would otherwise occur. Unfortunately, over the last decade the Government has increasingly squeezed small business out of contracting. As part of the ``Reinventing Government'' effort, acquisition has been streamlined. Now, I don't mean to suggest that all acquisition reform has been harmful. In fact, burdensome processes and bureaucracy also tend to discourage small business. Large businesses are more likely to have lawyers and contracting staff to wade through the bureaucracy, so excessive emphasis on process tends to crowd out small business. But in some areas we have gone too far. Contract bundling is a good example of this. By rolling several small contracts into large packages, the Government has made things simpler and faster for the contracting officers. It is administratively simpler to handle one bundled contract than ten smaller ones. However, that often crowds out small business. A small business owner looks at one of these huge contracts and says, ``Even if I won that contract, I couldn't carry it out. It's too big, and the requirements are too complex.'' So she, and it is often women business owners that suffer, she doesn't even bother to bid. Those two issues, the need to improve opportunity and to strengthen our defense vendor base, show why we need to take specific steps to restore small business access to procurement opportunities. Fortunately, we have a successful model to build upon! In the Fiscal 1991 defense authorization bill, the Congress adopted a provision to help small firms develop the technical infrastructure necessary to perform Federal contracts effectively. This pilot program, the Mentor-Protege program, provided for prime contractors either to be reimbursed for their added costs in providing technical assistance to small firms, or to receive credit for accomplishing their subcontracting plans in lieu of reimbursement. Experience under the Mentor-Protege pilot program has been very positive. We have learned a lot about what it takes to get small businesses ready to be serious players in Federal procurement. For firms that are simply delivering a specific order for a product, performing on that delivery order is often simple enough. But longer term, larger contracts are more complex. They require sustained effort over many months or years. They require a firm to commit to and achieve intermediate milestones on time. They require the firm to maintain quality assurance standards month in and month out, year in and year out. This can be extraordinarily challenging. Mentor firms have demonstrated that they can help train small protege firms to develop that infrastructure, so necessary to be successful in larger Federal contracts. I have a case history right here that I call to the attention of my colleagues. Scott Ulvi, of Anteon Corporation, has written me about his experience in mentoring, and Ray Lopez, of Engineering Services Network, has written about the value of the training and assistance he received from Anteon. I call particular attention to Mr. Lopez' experience in successfully receiving Federal contracts, only to have the reality sink in that he was originally unprepared to carry them out. His experience is truly instructive of what small business owners encounter daily, and I call his letter to the attention of my colleagues. I will ask unanimous consent that both letters be inserted into the Record at the conclusion of my remarks. The bill I am offering today would build upon the experience with the DOD program and make it governmentwide. Specifically, the Administrator of the Small Business Administration would be charged with developing a governmentwide program that would provide assistance to all types of firms targeted for special procurement procedures under the Small Business Act. Now, it would not be possible for the SBA to manage every Mentor- Protege relationship in the Federal Government. It would be administratively impossible. Thus, my bill calls for the Administrator to develop a core Mentor-Protege program, applicable across the Government, and to reimburse part of the expenses of agencies that agree to adopt the SBA program. Agencies would administer the program in-house, but would apply to be reimbursed for up to 50 percent of certain expenses incurred in a program that conforms to the Administrator's guidelines. The expenses to be partially reimbursed are those for which an agency reimburses the mentoring firms. Mentor firms can get reimbursed from the contracting office for added costs they incur in providing technical, managerial, and developmental assistance to the protege firm. Under this bill, up to 50 percent of these costs would then in turn be reimbursed to the agency from the SBA. The technical assistance provided through this reimbursable program is far and away the most valuable, as the letter from Scott Ulvi of Anteon Corporation describes. This program seeks to help agencies put together the resources they need to make such reimbursements. This program will help all agencies of the Government strengthen their vendor base, just as it has for the Department of Defense. It will help small businesses develop their abilities to compete for larger contracts, and the taxpayer will be the ultimate winner as a result of that competition. It also meets one of the Bush administration's goals, as described in the recent budget submission, of reducing fragmentation among Federal programs by ensuring a uniform, core Mentor-Protege program across the Government. Nothing succeeds like success. The DOD Mentor-Protege program, adopted as a pilot in 1991, has been such a success. Now we need to learn from that success and make it available across the Government. My bill proposes to do exactly that and I ask unanimous consent that the text of the bill and supporting letters be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, today I offer a bill to take a successful pilot program at the Department of Defense, make it permanent, and extend it governmentwide. For the past decade, DOD has had a program in place to try to develop and maintain small business vendors as a vital part of our Nation's defense industrial base. This program, the Mentor- Protege program, has also been a principal source of opportunity for small business, to offset some of the other Federal procurement practices that have squeezed small business out of contracting. Those two goals, the enhanced vendor base and improved opportunity, are worth emphasizing before I discuss the specific provisions of this bill. Why is small business participation in contracting important? Far too often, small business is seen as just another social or economic development program. In Federal contracting, however, it is much more than that. Small business is a critical, vital, indispensable part of our nation's preparedness for its defense. We have been working here in the Senate toward trying to shore up our defense preparedness. For the better part of a decade, DOD has had more and more missions with fewer and fewer resources. Now that we are trying to overcome this neglect with additional funding, we must also ensure that our economic base is strong, as well. It will do little good to have the money to buy defense-related goods and services if there are no vendors available to sell them. The DOD Office of Small and Disadvantaged Business Utilization has an excellent slogan that drives this point home. ``Small Business: A Readiness Multiplier.'' So, keeping small business involved in contracting is a matter of self-interest for our Nation. It is a matter of having the goods, the services, the resources for the warfighter to take into battle. Second, small business must have access to contracting as a matter of economic opportunity. The Government is an enormous customer. It averages about $180 to $190 billion worth of contracting every year. No one else has that kind of presence in the marketplace. If the Government spends the lion's share of its money on a handful of large insider corporations, it distorts the marketplace. It tends to give unfair advantage to the winning firms, purely because of the Government's enormous purchasing power. To avoid harming our economy with that kind of market distortion, the small business program seeks to disperse Government contracts among a variety of vendors. The small business program is not so much an intervention in the economy as it is a dilution of the distortion that would otherwise occur. Unfortunately, over the last decade the Government has increasingly squeezed small business out of contracting. As part of the ``Reinventing Government'' effort, acquisition has been streamlined. Now, I don't mean to suggest that all acquisition reform has been harmful. In fact, burdensome processes and bureaucracy also tend to discourage small business. Large businesses are more likely to have lawyers and contracting staff to wade through the bureaucracy, so excessive emphasis on process tends to crowd out small business. But in some areas we have gone too far. Contract bundling is a good example of this. By rolling several small contracts into large packages, the Government has made things simpler and faster for the contracting officers. It is administratively simpler to handle one bundled contract than ten smaller ones. However, that often crowds out small business. A small business owner looks at one of these huge contracts and says, ``Even if I won that contract, I couldn't carry it out. It's too big, and the requirements are too complex.'' So she, and it is often women business owners that suffer, she doesn't even bother to bid. Those two issues, the need to improve opportunity and to strengthen our defense vendor base, show why we need to take specific steps to restore small business access to procurement opportunities. Fortunately, we have a successful model to build upon! In the Fiscal 1991 defense authorization bill, the Congress adopted a provision to help small firms develop the technical infrastructure necessary to perform Federal contracts effectively. This pilot program, the Mentor-Protege program, provided for prime contractors either to be reimbursed for their added costs in providing technical assistance to small firms, or to receive credit for accomplishing their subcontracting plans in lieu of reimbursement. Experience under the Mentor-Protege pilot program has been very positive. We have learned a lot about what it takes to get small businesses ready to be serious players in Federal procurement. For firms that are simply delivering a specific order for a product, performing on that delivery order is often simple enough. But longer term, larger contracts are more complex. They require sustained effort over many months or years. They require a firm to commit to and achieve intermediate milestones on time. They require the firm to maintain quality assurance standards month in and month out, year in and year out. This can be extraordinarily challenging. Mentor firms have demonstrated that they can help train small protege firms to develop that infrastructure, so necessary to be successful in larger Federal contracts. I have a case history right here that I call to the attention of my colleagues. Scott Ulvi, of Anteon Corporation, has written me about his experience in mentoring, and Ray Lopez, of Engineering Services Network, has written about the value of the training and assistance he received from Anteon. I call particular attention to Mr. Lopez' experience in successfully receiving Federal contracts, only to have the reality sink in that he was originally unprepared to carry them out. His experience is truly instructive of what small business owners encounter daily, and I call his letter to the attention of my colleagues. I will ask unanimous consent that both letters be inserted into the Record at the conclusion of my remarks. The bill I am offering today would build upon the experience with the DOD program and make it governmentwide. Specifically, the Administrator of the Small Business Administration would be charged with developing a governmentwide program that would provide assistance to all types of firms targeted for special procurement procedures under the Small Business Act. Now, it would not be possible for the SBA to manage every Mentor- Protege relationship in the Federal Government. It would be administratively impossible. Thus, my bill calls for the Administrator to develop a core Mentor-Protege program, applicable across the Government, and to reimburse part of the expenses of agencies that agree to adopt the SBA program. Agencies would administer the program in-house, but would apply to be reimbursed for up to 50 percent of certain expenses incurred in a program that conforms to the Administrator's guidelines. The expenses to be partially reimbursed are those for which an agency reimburses the mentoring firms. Mentor firms can get reimbursed from the contracting office for added costs they incur in providing technical, managerial, and developmental assistance to the protege firm. Under this bill, up to 50 percent of these costs would then in turn be reimbursed to the agency from the SBA. The technical assistance provided through this reimbursable program is far and away the most valuable, as the letter from Scott Ulvi of Anteon Corporation describes. This program seeks to help agencies put together the resources they need to make such reimbursements. This program will help all agencies of the Government strengthen their vendor base, just as it has for the Department of Defense. It will help small businesses develop their abilities to compete for larger contracts, and the taxpayer will be the ultimate winner as a result of that competition. It also meets one of the Bush administration's goals, as described in the recent budget submission, of reducing fragmentation among Federal programs by ensuring a uniform, core Mentor-Protege program across the Government. Nothing succeeds like success. The DOD Mentor-Protege program, adopted as a pilot in 1991, has been such a success. Now we need to learn from that success and make it available across the Government. My bill proposes to do exactly that and I ask unanimous consent that the text of the bill and supporting letters be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, we are awaiting the imminent arrival of the budget from the House. We have had many important things going on in this Chamber. The debate on education is tremendously important. Yet I think it is necessary that we take a moment and recognize something that colleagues on both sides of the aisle will find very important, and I know support; and that is, the fact that this is Small Business Week. All of us know, particularly those of us who serve on the Small Business Committee, that small businesses are the dynamic engine which keeps the economy of America growing and provides most of the new jobs that are created. It provides opportunities, for the entrepreneurs and their families, for people to gain the kind of life they wish. In many areas, it also provides tremendous innovations that make our economy more advanced and enhances the livelihoods of not only the workers but the customers of those small businesses. This week I have been working with my colleagues on Small Business. My ranking member, Senator Kerry, and I, and members of the committee have participated in recognition ceremonies for Outstanding Small Businesspersons of the Year. There was White House recognition yesterday. I say to all my colleagues, there is a Small Businessperson of the Year from your State. I hope you have had the opportunity to congratulate them, to thank them for their work, and also to listen to them on what is important for small business. Since I took over and had the honor of becoming chairman of the Committee on Small Business in 1995, we have made it a point for the committee to be the eyes and ears of small business. We have listened to what small businesses have had to say, small businesses in Missouri and Massachusetts and Minnesota and Georgia and all across the Nation. If you ask them, they will tell you. We found out a number of things that are of concern to them. They are concerned about excessive regulation. They are concerned about taxation. They are concerned about the complexity of taxation. They are concerned about getting access to the Government contracting business that is available, unfortunately, too often only to larger businesses. Last year I hosted a national women's small business summit in Kansas City, MO, and getting access to defense contracts and other Federal Government contracts was high on their list. Working together with members of the Small Business Committee, we pushed to get rid of bundling and make sure that the small businesses get their fair share of contracts. I will be introducing a measure, a mentoring and protege bill, to do with other agencies of the Federal Government what the Defense Department has done, and that is to assign an experienced government contractor to work with small businesses to help them get in line for the contracts so they can participate in and fulfill those contracts. I have, with Senator Kerry, introduced a resolution commending Small Business Week. Somebody has put a hold on it. I really hope to reason with them and see if we can't get that passed. Almost anything we have done in small business in this body has been on a bipartisan basis. We hope to overcome that problem. There are a number of tax measures that are pending before the Senate now. I introduced the Small Business Works Act as a tax measure right after this session of Congress convened. It was based upon the tax priorities that women business owners had. No. 1 was getting rid of the alternative minimum tax. You have to figure out two guides of taxes, and then most small businesses are taxed as individuals. Some 21.2 million of them pay taxes on their personal income tax form. And when you have an AMT, you find out you lose many of the business deductions, and the small business person winds up paying a higher tax--certainly a higher tax, in many instances, than a regular C corporation pays. In addition, we would move up and make effective now 100-percent deductibility for health insurance paid for by small businesses. A proprietor running a small business should have the same opportunities to get health insurance for herself and her family as a large corporation does for its employees. That is in there. On Monday I introduced the Independent Contractor Determination Act. One of the things women business owners told us was, it is particularly troubling and has been a longstanding headache for small businesses to figure out who is an independent contractor and who is not. There is a 20-factor formula. Nobody understands the 20 factors, but the one thing you do understand is, if an IRS agent comes in 3 or 4 years later and applies the test, the IRS agent is going to win because nobody knows how to figure it out. The result is many small businesses have faced very heavy burdens. Some have been put out of business because somebody rejiggered them from independent contractor to employee, and this has been a tremendous problem. The laws ought to be simple enough to understand. There is a lot of complexity in the law. One of the things we must do, as we reform the Tax Code, is make it simpler. There is no more complex, uninterpretable, undefinable, unreasonable provision in the law than the current independent contractor provision. We must change that. The average small business spends 5 percent of its revenues figuring out the tax. That is not paying the taxes, that is just figuring out how much they owe. A nickel out of every dollar goes to calculating taxes because we have made it too complex. We need to make it simpler. Today I introduced a measure to build upon the Red Tape Reduction Act, also known as the Small Business Regulatory Enforcement Fairness Act. I was very pleased in 1996 to work with my then ranking member, Senator Bumpers, and we presented a bill unanimously out of the Small Business Committee to provide some relief for small businesses from excessive redtape and regulation. We thought we would have all kinds of problems getting on the floor, but we worked on a bipartisan basis. We had worked with the agencies of government to make sure their concerns were expressed. The only people who came to the floor were people who wished to be added as cosponsors. It passed unanimously, and it has been having an impact. The purpose of the Red Tape Reduction Act was to ensure that small businesses would be given a voice in the regulatory process at the time when it could make the difference before the regulation was published. The act has proven to be a regulatory process more attentive to the impact on small business and, consequently, is more fair and more efficient. I cite my good friend and constituent Dr. Murray Weidenbaum at the Center for the Study of American Business at Washington University who told me a couple of years ago that the Red Tape Reduction Act was perhaps the only--certainly the most--significant regulatory reform measure passed by Congress in recent history, in the last 20 years or so. We have seen the impact of this provision. The Red Tape Reduction Act, among other things, requires that OSHA and EPA convene panels to involve small businesses in formulating regulations before the regulations are proposed. It gives the agencies the unique opportunity to learn upfront what problems their regulation may cause and to correct the problems with the least difficulty. In one case, EPA totally abandoned a regulation when they recognized that the industry could deal with it much more effectively on its own. Experience with the panel process has proven to be an unequivocal success. The former chief counsel for advocacy of the Small Business Administration, Jere Glover, who worked hard to make sure the act worked, stated: Unquestionably, the SBREFA panel process has had a very salutary impact on the regulatory deliberations of OSHA and EPA, resulting in major changes to draft regulations. What is important to note is that these changes were accomplished without sacrificing the agencies' public policy objectives. That is what we had in mind. Many times small businesses get run over if they are left out of the process. We had a hearing just a couple weeks ago in the Small Business Committee and found out the fisheries regulations had worked tremendous hardship on small fishermen along the North Carolina coast when they decided to change the bag limit, the catch limit, in the fall and wiped out many small businesses. They forgot to ask how best to implement the fisheries regulation. Another business in my State was working on a process to replace a particular chemical that the EPA said it was going to phase out. They had invested a great deal of time, money, and interest in the process of getting it developed. EPA changed the rule and the regulation and the time limit in midprocess and left them completely out in the dark. These are the kinds of things that Government ought not to be doing. Government ought not to be running roughshod over people who are trying to contribute to the economy, provide good employment opportunities, provide a solid tax base for the community, and provide good wages for the proprietor and employees and their families. We think the Red Tape Reduction Act can be expanded and can be of even greater value. It has demonstrated the value of small business input in the regulatory process, but still too many agencies are trying to evade the requirements to conduct regulatory flexibility analyses-- that is the technical term for seeing how it will impact the small business; ``regulatory flexibility'' analysis is the technical term--to figure out how it is going to hurt small business. We now realize that the Internal Revenue Service should also be required to conduct small business review panels so that their regulations will impose the least possible burden on a small business while still achieving the mission of the agency. I think there is no question we have worked with the new Commissioner of the IRS, Commissioner Rossotti. We have seen many steps taken by the IRS to relieve the burdens. I don't know anybody who really likes to pay taxes. We realize that it is an important part of supporting our Government and our system. But at least we ought to do so in a way that is the least confusing and burdensome. So I think it is important that we provide a mechanism so that parties will be able to reserve the benefits of their rights to participate at the earliest stages and have the most impact. We believe the litigation that is available at the end of the process if an agency fails to take into account the burden on small business is important because prior to the Redtape Reduction Act, the law had been on the books since 1980 that agencies ought to consider the impact on small business, and it was absolutely, totally ignored by the agencies; without judicial enforcement, they didn't get anywhere. So we added judicial enforcement and they started paying attention. The Agency Accountability Act, which I introduce today, cures a number of additional problems that we have identified. Let me run through quickly what it does. No. 1, it requires agencies to publish the decision to certify a regulation as not having a significant economic impact on a substantial number of small entities separately in the Federal Register. That means, in certain circumstances, the agency doesn't have to consider the impact on small business. That is how most of the bad regulations get through. EPA was infamous for doing that and saying it didn't have any impact. The regulation comes down to small business, which says we are getting killed. Then they have to fight the battle. Then they go to court and prove that they are impacted and the EPA didn't pay any attention to them. This says if you are going to use that escape clause to say the regulation doesn't have any impact on a small business, you have to set that out--set out in the Federal Register what you are doing and the fact that it does not have an impact. So you can perhaps correct the problems if there are small businesses that can show they are impacted before the regulation is issued. Second, the Triple A Act requires the agency to publish a summary of its economic analysis supporting the certification decision; i.e., if you say it doesn't have any economic impact, don't just grab it out of your hip pocket, or hat. You have to have an analysis to show why it would not. You have to make that available to the public so that interested parties will be able to see whether, in fact, it was pulled out of your hat, or whether it is based on sound economic reasoning. The third thing the Triple A does is it allows small entities to seek judicial review of this certification decision. They can go to the agency and say: Agency, you are trying to get out of the regulatory flexibility requirements--you are trying to get out of the requirement to see how the impact on small business can be lessened. If they say they disagree with them, the small entity can go to court and get it enforced. When I say ``small entity,'' this is not only available to small businesses, it is available to local governments, to not-for-profit organizations, eleemosynary institutions, available for the small entities in this country that do not have lobbyists or a presence in Washington. Small entities are entitled to use this Redtape Reduction Act. Fourth, the measure directs the Chief Counsel for Advocacy of the Small Business Administration to put out a regulation defining the terms that the agency has to use in determining whether they can escape an analysis of how small business will be impacted. These terms are ``significant economic impact,'' and ``substantial number of small entities.'' We found that a number of agencies like to jack around with those terms and skew the facts so that they can sneak out the back door without having to do what the bill requires. This gives the advocacy counsel the ability to say this is what we mean and this is how you have to abide by it. If they don't follow that, then they are ducking their responsibilities under SBREFA and the Regulatory Flexibility Act. The other thing is, Triple A adds the IRS, U.S. Forest Service, National Marine Fisheries Service, and the Fish and Wildlife Service to the list of agencies that must conduct small business review panels before they can issue proposed regulations. All Federal agencies are covered by the provisions of the Regulatory Flexibility Act. If you ignore it, you can get hauled into court and have your regulation overturned if it has a significant economic impact on a substantial number of small entities. But this is to say that based on their track record and problems in the past, we are going to have you do what OSHA and EPA have been required to do, and that is set up panels involving small businesses prior to formulating the regulation. If you ask small business how is this regulation going to affect you and people like you, you may find out that there are a lot better ways of doing it. That is what EPA found out in one of the regulations it considered. Certainly, an agency is not going to be able to say: Gee, I had no idea that it would cause such a hardship on you. It is as important as any part of Government service, and it is too bad we have to write it into law. We cannot be good Government servants, either as legislators or bureaucrats, or members of the executive branch if we don't listen to the voices, the hopes, concerns, and problems of average citizens. We are just saying under this new measure that there are a couple of agencies that have to be told by law to listen to the people they are going to regulate. Pay attention to them. They don't have to like all the regulations but at least listen to their concerns about how the regulations affect them and how you may be able to accomplish the purpose of the law you are seeking to administer, without putting burdens on small agencies. Well, Mr. President, this bill grows out of extensive review of how the Redtape Reduction Act has functioned in the last 5 years. We still see a lot of frustration by small businesses about how agencies continue to find ways to avoid including small business input in rulemakings, and some of the actions that our agencies take confirm the worst image of agency bureaucrats who are thought to know what is best for small business throughout the country, and when the small businesses are actually providing jobs, developing technology and keeping the economy growing. But somebody here in Washington has a lot better idea how they ought to be running their business. We need to have an interaction so that the people out there who are creating jobs, developing the technology, earning a living for their families and themselves can have an input into the agency that is going to regulate. The General Accounting Office found recently that the EPA missed 1,098 small companies in the 32 SIC codes of industries that will be affected by their rule lowering the threshold for companies to report their use of lead. EPA thus concluded that their rule would not have a significant economic impact on a substantial number of small entities despite reducing the threshold of lead emissions from 25,000 pounds to 10 pounds--a reduction of 99.96 percent. EPA, instead, relied on an average revenue compiled from all companies in the manufacturing industries to determine what threshold would be set to trigger the small business review panel required by the Redtape Production Act. The average included companies such as General Motors, General Electric, 3M, and others that skewed the average so that it looked as though the rule would have no impact on small business. But I can tell you that a small business with 11 pounds of lead is absolutely clobbered by this rule. Although EPA claimed to conduct outreach to find firms that would be affected, they only contacted nine sources, although some of these sources allegedly contacted have no record of EPA contacting them. I think there is no excuse for that type of arrogance and abject avoidance of their requirements with respect to small business. This shoddy economic analysis exposes a loophole through which EPA should no longer be able to drive their trucks, and it will be closed by the Agency Accountability Act. I submitted previously, when I introduced the measure this morning, the GAO testimony presented at the hearing. Now I know there will be moans and groans by those who claim that this bill will make the regulatory profess more difficult and force agencies to jump through hoops and will make it harder to issue new regulations. Let me respond as follows: Had the agencies agreed to comply with the intent and spirit of SBREFA, rather than defy SBREFA, the Redtape Reduction Act, the Agency Accountability Act would not be needed. Frankly, if it were clear that agencies were doing what Congress intended for them to do, then this bill would be unnecessary. If they are doing adequate analysis in reaching out to small business now, then this act will have no impact on how they promulgate their regulation. I have very simple views on this subject. I want an agency that intends to regulate how a business conducts its affairs, to do so carefully and only after it has listened to the small businesses that will be affected to see if there are ways in which to lessen the burden and still achieve the objective. Unfortunately, as I said, there is overwhelming evidence that agencies are not treating this obligation seriously, and we must tell them in forceful terms that we really meant it when we said 5 years ago: You have to pay attention to small business. I was very pleased we did so in a tremendous bipartisan, unanimous vote. I am hoping we can do the same with this agency accountability bill. Let all agencies know firsthand: If you do your job right, then this should be no problem. If you are not doing your job this way, you ought to be because it will cause less headache, less lawsuits, and less problems in the end. Had EPA done what it should have done in the lead TRI rulemaking, there would not be the litigation we are seeing now, and it would have saved businesses and the Government untold sums of taxpayers' dollars. This body has said they want to treat small businesses fairly. The Agency Accountability Act is the next step in doing so. As I said earlier, I have introduced with bipartisan support a number of measures that I think are going to be very helpful for small business. I hope during the course of Small Business Week my colleagues will look at these and particularly take the time to listen to the men and women of small business who have come to Washington and continue the work in their home States to find out what their concerns are. I will be cosponsoring a measure that my colleague, Senator Kerry, will be introducing to reauthorize and extend a very important STTR bill which is a very important act in terms of transferring technology. It is a small business technology transfer program. I will have a statement that I will add after Senator Kerry introduces the bill. I hope this will merit the attention of our colleagues. I ask unanimous consent that the testimony of Hubert Potter, Tim Kalinowski, and Victor Rezendes of the General Accounting Office before the Committee on Small Business and a Summary of Provisions be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, I am pleased to join with Senator John Kerry, my colleague and ranking member on the Small Business Committee, in sponsoring legislation to reauthorize the Small Business Technology Transfer, STTR, Program. This program has proven itself to be highly effective. The bill we are introducing today acknowledges the success of the STTR Program by expanding it during the length of the reauthorization so that its benefits will increase in the coming years. The STTR Program was created in 1992 to stimulate technology transfer from research institutions to small firms while, at the same time, accomplishing the Federal government's research and development goals. The program is designed to convert the billions of dollars invested in research and development at our nation's universities, federal laboratories and nonprofit research institutions into new commercial technologies. It does this by joining the ideas and resources of research institutions with the commercialization experience of small companies. Each agency with an extramural research and development budget of more than $1 billion participates in the program. Currently, the Department of Defense, the National Institutes of Health, the National Aeronautics and Space Administration, NASA, the National Science Foundation, NSF, and the Department of Energy, DOE, have STTR Programs. To receive an award under the STTR Program, a research institution and a small firm jointly submit a proposal to conduct research on a topic that reflects an agency's mission and research and development needs. The proposals are then peer-reviewed and judged on their scientific, technical and commercial merit. Similar to the Small Business Innovation Research Program, awards are provided in three phases. Phase one awards are designed to determine the scientific and technical merit and feasibility of a proposed research idea, with funding for individual awards limited to $100,000. Phase two awards further develop research from phase one and emphasize the idea's commercialization potential, with individual awards up to $500,000. Phase three awards consist of non-Federal funds for the commercial application of the technology, non-STTR Federal funds for the commercialization of products or services intended for procurement by the Federal government, or non-STTR Federal funds for continued research and development of the technology. The benefits of fostering collaboration between research institutions and small firms are numerous. Small firms have shown themselves to be excellent at commercializing research when they are provided the opportunity to take advantage of the expertise and resources that reside in our nation's universities. A recent Small Business Administration Office of Advocacy report reviewed the rate of return for research and development by large and small firms both with and without university partners. When these firms do not have university partners, their rate of return is 14 percent. When a collaboration is formed between universities and small firms, however, the rate of return jumps to 44 percent. By contrast, the rate of return only increases to 30 percent when large firms and universities collaborate. Moreover, partnerships between small firms and universities have led to world-class high-technology economic development. Numerous studies cite the emergence of Silicon Valley and the Route 128 corridor in Massachusetts as directly resulting from the partnerships and technology transfer that occurred, and are still occurring, among small firms, Stanford University and the Massachusetts Institute of Technology. The cooperation between industry and these universities has strengthened considerably our economic competitiveness in the world. The STTR Program seeks to foster this same type of economic development in the hundreds of communities around the country that contain universities and federal laboratories. And, the STTR Program has proven to be immensely successful at growing small firms from these types of partnerships. The Committee on Small Business has recently received data on the commercial success of small firms that received STTR awards between 1995 and 1997. The results are truly outstanding. Of the 102 projects surveyed in that time-frame, 53 percent had either resulted in sales or the companies involved in the projects had received follow-on developmental funding for the technology. To date, these projects had resulted in $132 million from sales and $53 million in additional developmental funding. Moreover, the Committee has learned that the companies who had received these STTR awards are projecting an additional $186 million in sales in 2001 and an estimated additional $900 million in sales by 2005. These numbers are even more remarkable when one considers that it typically takes between 7 to 10 years to successfully commercialize new technologies. In addition to proving to be an amazing commercial success, the STTR Program has also provided high-quality research to the Federal Government. In the most recent published report of the General Accounting Office on the STTR Program, Federal agencies rated highly the technical quality of the proposals. The DOE, as an example, rated the quality of the proposed research in the top ten percent of all research funded by the Department. A good example of the benefits that the STTR Program provides to small firms and universities is the experience of Engineering Software Research and Development, Inc. in St. Louis, MO. Engineering Software, in partnership with Washington University in St. Louis, received a phase two award from the Air Force to develop an innovative method of analyzing the stresses placed on composite materials. While this technology is currently being used in the aeronautics industry, it has many other practical applications. The STTR Program permitted Dr. Barna Szabo, who had originated an algorithm he developed at Washington University, to transfer the technology to Engineering Software, which had the software infrastructure to transition the technology from an academic to a practical commercial application. According to Dr. Szabo, Engineering Software has received to date at an estimated $1.25 million in sales and follow-on developmental funding resulting from the technology funded by the STTR award and that the STTR Program was of great assistance in transferring the technology from the academic environment to actual use and application. Based on the proven success of the STTR Program to date, this legislation increases the funds allocated for the program. This increase is phased-in through the length of the reauthorization. When a program is working as well as the STTR Program, it would be a mistake if Congress did not build on its success. This is especially true for Federal investment in small business research and development. Despite report after report demonstrating that small businesses innovate at a greater rate than large firms, small businesses only receive less than four percent of all Federal research and development dollars. This number has remained essentially unchanged for the past 22 years. Increasing funds for the STTR Program sends a strong message that the Federal Government acknowledges the contributions that small businesses have made and will continue to make to government research and development efforts and to our nation's economy. I am pleased that my colleague Senator Kerry and I have worked together on this bi-partisan legislation. It is a good bill for the small business high-technology community and will ensure that our Federal research and development needs are well met in the next decade. When this bill is debated by the full Senate, I trust that it will receive the support of all of our colleagues.

Mr. BOND. Mr. President, we are awaiting the imminent arrival of the budget from the House. We have had many important things going on in this Chamber. The debate on education is tremendously important. Yet I think it is necessary that we take a moment and recognize something that colleagues on both sides of the aisle will find very important, and I know support; and that is, the fact that this is Small Business Week. All of us know, particularly those of us who serve on the Small Business Committee, that small businesses are the dynamic engine which keeps the economy of America growing and provides most of the new jobs that are created. It provides opportunities, for the entrepreneurs and their families, for people to gain the kind of life they wish. In many areas, it also provides tremendous innovations that make our economy more advanced and enhances the livelihoods of not only the workers but the customers of those small businesses. This week I have been working with my colleagues on Small Business. My ranking member, Senator Kerry, and I, and members of the committee have participated in recognition ceremonies for Outstanding Small Businesspersons of the Year. There was White House recognition yesterday. I say to all my colleagues, there is a Small Businessperson of the Year from your State. I hope you have had the opportunity to congratulate them, to thank them for their work, and also to listen to them on what is important for small business. Since I took over and had the honor of becoming chairman of the Committee on Small Business in 1995, we have made it a point for the committee to be the eyes and ears of small business. We have listened to what small businesses have had to say, small businesses in Missouri and Massachusetts and Minnesota and Georgia and all across the Nation. If you ask them, they will tell you. We found out a number of things that are of concern to them. They are concerned about excessive regulation. They are concerned about taxation. They are concerned about the complexity of taxation. They are concerned about getting access to the Government contracting business that is available, unfortunately, too often only to larger businesses. Last year I hosted a national women's small business summit in Kansas City, MO, and getting access to defense contracts and other Federal Government contracts was high on their list. Working together with members of the Small Business Committee, we pushed to get rid of bundling and make sure that the small businesses get their fair share of contracts. I will be introducing a measure, a mentoring and protege bill, to do with other agencies of the Federal Government what the Defense Department has done, and that is to assign an experienced government contractor to work with small businesses to help them get in line for the contracts so they can participate in and fulfill those contracts. I have, with Senator Kerry, introduced a resolution commending Small Business Week. Somebody has put a hold on it. I really hope to reason with them and see if we can't get that passed. Almost anything we have done in small business in this body has been on a bipartisan basis. We hope to overcome that problem. There are a number of tax measures that are pending before the Senate now. I introduced the Small Business Works Act as a tax measure right after this session of Congress convened. It was based upon the tax priorities that women business owners had. No. 1 was getting rid of the alternative minimum tax. You have to figure out two guides of taxes, and then most small businesses are taxed as individuals. Some 21.2 million of them pay taxes on their personal income tax form. And when you have an AMT, you find out you lose many of the business deductions, and the small business person winds up paying a higher tax--certainly a higher tax, in many instances, than a regular C corporation pays. In addition, we would move up and make effective now 100-percent deductibility for health insurance paid for by small businesses. A proprietor running a small business should have the same opportunities to get health insurance for herself and her family as a large corporation does for its employees. That is in there. On Monday I introduced the Independent Contractor Determination Act. One of the things women business owners told us was, it is particularly troubling and has been a longstanding headache for small businesses to figure out who is an independent contractor and who is not. There is a 20-factor formula. Nobody understands the 20 factors, but the one thing you do understand is, if an IRS agent comes in 3 or 4 years later and applies the test, the IRS agent is going to win because nobody knows how to figure it out. The result is many small businesses have faced very heavy burdens. Some have been put out of business because somebody rejiggered them from independent contractor to employee, and this has been a tremendous problem. The laws ought to be simple enough to understand. There is a lot of complexity in the law. One of the things we must do, as we reform the Tax Code, is make it simpler. There is no more complex, uninterpretable, undefinable, unreasonable provision in the law than the current independent contractor provision. We must change that. The average small business spends 5 percent of its revenues figuring out the tax. That is not paying the taxes, that is just figuring out how much they owe. A nickel out of every dollar goes to calculating taxes because we have made it too complex. We need to make it simpler. Today I introduced a measure to build upon the Red Tape Reduction Act, also known as the Small Business Regulatory Enforcement Fairness Act. I was very pleased in 1996 to work with my then ranking member, Senator Bumpers, and we presented a bill unanimously out of the Small Business Committee to provide some relief for small businesses from excessive redtape and regulation. We thought we would have all kinds of problems getting on the floor, but we worked on a bipartisan basis. We had worked with the agencies of government to make sure their concerns were expressed. The only people who came to the floor were people who wished to be added as cosponsors. It passed unanimously, and it has been having an impact. The purpose of the Red Tape Reduction Act was to ensure that small businesses would be given a voice in the regulatory process at the time when it could make the difference before the regulation was published. The act has proven to be a regulatory process more attentive to the impact on small business and, consequently, is more fair and more efficient. I cite my good friend and constituent Dr. Murray Weidenbaum at the Center for the Study of American Business at Washington University who told me a couple of years ago that the Red Tape Reduction Act was perhaps the only--certainly the most--significant regulatory reform measure passed by Congress in recent history, in the last 20 years or so. We have seen the impact of this provision. The Red Tape Reduction Act, among other things, requires that OSHA and EPA convene panels to involve small businesses in formulating regulations before the regulations are proposed. It gives the agencies the unique opportunity to learn upfront what problems their regulation may cause and to correct the problems with the least difficulty. In one case, EPA totally abandoned a regulation when they recognized that the industry could deal with it much more effectively on its own. Experience with the panel process has proven to be an unequivocal success. The former chief counsel for advocacy of the Small Business Administration, Jere Glover, who worked hard to make sure the act worked, stated: Unquestionably, the SBREFA panel process has had a very salutary impact on the regulatory deliberations of OSHA and EPA, resulting in major changes to draft regulations. What is important to note is that these changes were accomplished without sacrificing the agencies' public policy objectives. That is what we had in mind. Many times small businesses get run over if they are left out of the process. We had a hearing just a couple weeks ago in the Small Business Committee and found out the fisheries regulations had worked tremendous hardship on small fishermen along the North Carolina coast when they decided to change the bag limit, the catch limit, in the fall and wiped out many small businesses. They forgot to ask how best to implement the fisheries regulation. Another business in my State was working on a process to replace a particular chemical that the EPA said it was going to phase out. They had invested a great deal of time, money, and interest in the process of getting it developed. EPA changed the rule and the regulation and the time limit in midprocess and left them completely out in the dark. These are the kinds of things that Government ought not to be doing. Government ought not to be running roughshod over people who are trying to contribute to the economy, provide good employment opportunities, provide a solid tax base for the community, and provide good wages for the proprietor and employees and their families. We think the Red Tape Reduction Act can be expanded and can be of even greater value. It has demonstrated the value of small business input in the regulatory process, but still too many agencies are trying to evade the requirements to conduct regulatory flexibility analyses-- that is the technical term for seeing how it will impact the small business; ``regulatory flexibility'' analysis is the technical term--to figure out how it is going to hurt small business. We now realize that the Internal Revenue Service should also be required to conduct small business review panels so that their regulations will impose the least possible burden on a small business while still achieving the mission of the agency. I think there is no question we have worked with the new Commissioner of the IRS, Commissioner Rossotti. We have seen many steps taken by the IRS to relieve the burdens. I don't know anybody who really likes to pay taxes. We realize that it is an important part of supporting our Government and our system. But at least we ought to do so in a way that is the least confusing and burdensome. So I think it is important that we provide a mechanism so that parties will be able to reserve the benefits of their rights to participate at the earliest stages and have the most impact. We believe the litigation that is available at the end of the process if an agency fails to take into account the burden on small business is important because prior to the Redtape Reduction Act, the law had been on the books since 1980 that agencies ought to consider the impact on small business, and it was absolutely, totally ignored by the agencies; without judicial enforcement, they didn't get anywhere. So we added judicial enforcement and they started paying attention. The Agency Accountability Act, which I introduce today, cures a number of additional problems that we have identified. Let me run through quickly what it does. No. 1, it requires agencies to publish the decision to certify a regulation as not having a significant economic impact on a substantial number of small entities separately in the Federal Register. That means, in certain circumstances, the agency doesn't have to consider the impact on small business. That is how most of the bad regulations get through. EPA was infamous for doing that and saying it didn't have any impact. The regulation comes down to small business, which says we are getting killed. Then they have to fight the battle. Then they go to court and prove that they are impacted and the EPA didn't pay any attention to them. This says if you are going to use that escape clause to say the regulation doesn't have any impact on a small business, you have to set that out--set out in the Federal Register what you are doing and the fact that it does not have an impact. So you can perhaps correct the problems if there are small businesses that can show they are impacted before the regulation is issued. Second, the Triple A Act requires the agency to publish a summary of its economic analysis supporting the certification decision; i.e., if you say it doesn't have any economic impact, don't just grab it out of your hip pocket, or hat. You have to have an analysis to show why it would not. You have to make that available to the public so that interested parties will be able to see whether, in fact, it was pulled out of your hat, or whether it is based on sound economic reasoning. The third thing the Triple A does is it allows small entities to seek judicial review of this certification decision. They can go to the agency and say: Agency, you are trying to get out of the regulatory flexibility requirements--you are trying to get out of the requirement to see how the impact on small business can be lessened. If they say they disagree with them, the small entity can go to court and get it enforced. When I say ``small entity,'' this is not only available to small businesses, it is available to local governments, to not-for-profit organizations, eleemosynary institutions, available for the small entities in this country that do not have lobbyists or a presence in Washington. Small entities are entitled to use this Redtape Reduction Act. Fourth, the measure directs the Chief Counsel for Advocacy of the Small Business Administration to put out a regulation defining the terms that the agency has to use in determining whether they can escape an analysis of how small business will be impacted. These terms are ``significant economic impact,'' and ``substantial number of small entities.'' We found that a number of agencies like to jack around with those terms and skew the facts so that they can sneak out the back door without having to do what the bill requires. This gives the advocacy counsel the ability to say this is what we mean and this is how you have to abide by it. If they don't follow that, then they are ducking their responsibilities under SBREFA and the Regulatory Flexibility Act. The other thing is, Triple A adds the IRS, U.S. Forest Service, National Marine Fisheries Service, and the Fish and Wildlife Service to the list of agencies that must conduct small business review panels before they can issue proposed regulations. All Federal agencies are covered by the provisions of the Regulatory Flexibility Act. If you ignore it, you can get hauled into court and have your regulation overturned if it has a significant economic impact on a substantial number of small entities. But this is to say that based on their track record and problems in the past, we are going to have you do what OSHA and EPA have been required to do, and that is set up panels involving small businesses prior to formulating the regulation. If you ask small business how is this regulation going to affect you and people like you, you may find out that there are a lot better ways of doing it. That is what EPA found out in one of the regulations it considered. Certainly, an agency is not going to be able to say: Gee, I had no idea that it would cause such a hardship on you. It is as important as any part of Government service, and it is too bad we have to write it into law. We cannot be good Government servants, either as legislators or bureaucrats, or members of the executive branch if we don't listen to the voices, the hopes, concerns, and problems of average citizens. We are just saying under this new measure that there are a couple of agencies that have to be told by law to listen to the people they are going to regulate. Pay attention to them. They don't have to like all the regulations but at least listen to their concerns about how the regulations affect them and how you may be able to accomplish the purpose of the law you are seeking to administer, without putting burdens on small agencies. Well, Mr. President, this bill grows out of extensive review of how the Redtape Reduction Act has functioned in the last 5 years. We still see a lot of frustration by small businesses about how agencies continue to find ways to avoid including small business input in rulemakings, and some of the actions that our agencies take confirm the worst image of agency bureaucrats who are thought to know what is best for small business throughout the country, and when the small businesses are actually providing jobs, developing technology and keeping the economy growing. But somebody here in Washington has a lot better idea how they ought to be running their business. We need to have an interaction so that the people out there who are creating jobs, developing the technology, earning a living for their families and themselves can have an input into the agency that is going to regulate. The General Accounting Office found recently that the EPA missed 1,098 small companies in the 32 SIC codes of industries that will be affected by their rule lowering the threshold for companies to report their use of lead. EPA thus concluded that their rule would not have a significant economic impact on a substantial number of small entities despite reducing the threshold of lead emissions from 25,000 pounds to 10 pounds--a reduction of 99.96 percent. EPA, instead, relied on an average revenue compiled from all companies in the manufacturing industries to determine what threshold would be set to trigger the small business review panel required by the Redtape Production Act. The average included companies such as General Motors, General Electric, 3M, and others that skewed the average so that it looked as though the rule would have no impact on small business. But I can tell you that a small business with 11 pounds of lead is absolutely clobbered by this rule. Although EPA claimed to conduct outreach to find firms that would be affected, they only contacted nine sources, although some of these sources allegedly contacted have no record of EPA contacting them. I think there is no excuse for that type of arrogance and abject avoidance of their requirements with respect to small business. This shoddy economic analysis exposes a loophole through which EPA should no longer be able to drive their trucks, and it will be closed by the Agency Accountability Act. I submitted previously, when I introduced the measure this morning, the GAO testimony presented at the hearing. Now I know there will be moans and groans by those who claim that this bill will make the regulatory profess more difficult and force agencies to jump through hoops and will make it harder to issue new regulations. Let me respond as follows: Had the agencies agreed to comply with the intent and spirit of SBREFA, rather than defy SBREFA, the Redtape Reduction Act, the Agency Accountability Act would not be needed. Frankly, if it were clear that agencies were doing what Congress intended for them to do, then this bill would be unnecessary. If they are doing adequate analysis in reaching out to small business now, then this act will have no impact on how they promulgate their regulation. I have very simple views on this subject. I want an agency that intends to regulate how a business conducts its affairs, to do so carefully and only after it has listened to the small businesses that will be affected to see if there are ways in which to lessen the burden and still achieve the objective. Unfortunately, as I said, there is overwhelming evidence that agencies are not treating this obligation seriously, and we must tell them in forceful terms that we really meant it when we said 5 years ago: You have to pay attention to small business. I was very pleased we did so in a tremendous bipartisan, unanimous vote. I am hoping we can do the same with this agency accountability bill. Let all agencies know firsthand: If you do your job right, then this should be no problem. If you are not doing your job this way, you ought to be because it will cause less headache, less lawsuits, and less problems in the end. Had EPA done what it should have done in the lead TRI rulemaking, there would not be the litigation we are seeing now, and it would have saved businesses and the Government untold sums of taxpayers' dollars. This body has said they want to treat small businesses fairly. The Agency Accountability Act is the next step in doing so. As I said earlier, I have introduced with bipartisan support a number of measures that I think are going to be very helpful for small business. I hope during the course of Small Business Week my colleagues will look at these and particularly take the time to listen to the men and women of small business who have come to Washington and continue the work in their home States to find out what their concerns are. I will be cosponsoring a measure that my colleague, Senator Kerry, will be introducing to reauthorize and extend a very important STTR bill which is a very important act in terms of transferring technology. It is a small business technology transfer program. I will have a statement that I will add after Senator Kerry introduces the bill. I hope this will merit the attention of our colleagues. I ask unanimous consent that the testimony of Hubert Potter, Tim Kalinowski, and Victor Rezendes of the General Accounting Office before the Committee on Small Business and a Summary of Provisions be printed in the Record.

Mr. BOND

Mr. BOND. Mr. President, as has been the tradition for the past 38 years, the President of the United States has issued a proclamation calling for the celebration of Small Business Week. Today, we are in the middle of Small Business Week 2001, which is being sponsored by the Small Business Administration. The purpose of this week's celebration is to honor over 25 million businesses that make up the U.S. small business community. It is very appropriate for us, today, to recognize the importance of America's small businesses, and the significant role played by the Small Business Administration, SBA, in our Nation's economic growth. Congress established the SBA in 1953 to provide financial and management assistance to start-up and growing small businesses. Over the past 48 years, the success of SBA in meeting its missions is legend. It maintains a portfolio of guaranteed small business loans and disaster loans totaling more than $45 billion. And the Agency has guaranteed another $13 billion in venture capital investments to small businesses. To compliment it successful credit programs, the SBA's management assistance programs were delivered to more than one million small businesses during the past fiscal year. Over the past decade of record economic growth and prosperity, U.S. small businesses have been the engine driving our economy. More than 99% of all employers in the United States are small businesses, providing nearly 75% of the net new jobs added to our workforce. Small businesses have proven, year-in and year-out, that they are a potent force in the economy, accounting for 51% of the private sector output. And their sights are not set just at home; leading the way toward a global economy, the small business community represents 96% of all U.S. exporters. Over the past 6 years I have been the chairman of the Committee on Small Business, and I have witnessed the enormous potential of America's small businesses at work. They are flexible; they are creative; they give us jobs; they provide economic growth; and most importantly, they provide hope and a future for millions of families and communities across our great nation. The resolution now before the Senate recognizes the critical role played by small businesses and the Small Business Administration in this business community. It is appropriate that we take a moment from our hectic lives to acknowledge the success of small businesses and to encourage our federal government to continue to provide its help to insure future successes. I urge each of my colleagues to vote for the Small Business resolution as a way to thank the SBA and the small business community for its contributions to our Nation.

Mr. BOND

Mr. BOND. Mr. President, I ask unanimous consent to proceed as in morning business.