Chris Cannon

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today in support of S. 167. I commend the gentleman from Texas (Mr. Smith) for introducing the House counterpart of this legislation, and I commend the gentleman from Wisconsin (Chairman Sensenbrenner) and the gentleman from California (Mr. Berman) for their continued diligence in bringing this legislation to the floor. Mr. Speaker, included in Title II of this legislation is the Family Movie Act of 2005. This title clarifies the Copyright Act so families, in the privacy of their homes, can use technology that allows them to skip or mute objectionable content in legally purchased or rented DVDs. Parents should have the right to watch any movie they want and to skip over or mute any content they find objectionable. This legislation will allow parents to have the final say in what their children watch in the privacy of their homes, and parents should have the option to protect their children from the sex, violence, profanity and other objectionable material found in movies that are produced in Hollywood these days. This legislation allows them to do so by clarifying the exemption in the copyright infringement law allowing people to skip, mute or avoid scenes on DVDs. This legislation does not allow for the modifying of the underlying content of the movie, it merely allows fast forwarding or muting portions of the movie or sound track. Thanks to this legislation, parents can control the content their children view without having to hold a finger on the remote control and anticipate scenes they might find objectionable. Mr. Speaker, technology that helps parents accomplish this goal should be applauded. S. 167 will allow for technology innovation to flourish without having to face continued legal challenges. This bill is an ideal solution that can be used by families in the home, and does not require limits to be placed on content the studios develop. I support this legislation. I urge the support of my colleagues.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise in support of Senate bill 256 and urge its adoption by the House. Whether or not we have a cost of $400 per household or some other cost, I think it is clear to all Americans that we pay a cost if we have excessive bankruptcies in America. What we are looking for here is workable markets where consumers have the opportunity to borrow money at the lowest cost. Hopefully, they are not above 18 percent; certainly not at 75 percent. The market does a remarkable job for that purpose. For more than 7 years now, almost as long as I have been in Congress, we have struggled with the rising tide of bankruptcy abuse which threatens the delicate balance in this country between creditors and debtors. As this reform measure has developed, slowly, inexorably, we have dealt with each issue: framing, debating, considering, and ultimately resolving each controversy. Progressive Congresses have moved toward ultimate resolution, until finally today the House has been presented with a bill that it can send directly to the President for signature. As chairman of the Subcommittee on Commercial and Administrative Law, I take considerable satisfaction that, through collective effort, we would be able to achieve what many said would never happen. We have crafted fair and balanced legislation dealing in a straightforward manner with a problem that has vexed the Nation for the past decade and threatens economic growth and stability. By the way, the Bankruptcy Act has not been amended for 25 years in a serious way. The American people will truly be well served by this effort. This bill is a rare achievement of reducing disparity in the bankruptcy system. It establishes more uniform and predictable standards. It strengthens the integrity of the bankruptcy process. It deals with the continuing wave of bankruptcy filings and abuse of State homestead exemptions. It will reinforce the public perception that the system is fair for all participants. It improves the administration of the bankruptcy process. And, finally, it restores a measure of personal responsibility to the bankruptcy system that is spiraling out of control. Mr. Speaker, my constituents need this legislation, and America needs this legislation, and I urge support today for S. 256. I would also note that the need for additional bankruptcy judgeships may need to be considered to reflect the numbers submitted by the Judicial Conference's most recent report. Additional judgeships are sorely needed in a number of districts across the country, including my State of Utah. I was heartened by the assurance of the chairman of the Committee on the Judiciary during the markup of Senate 256 that this matter will be considered later this year. In that regard, I would like to thank the gentleman from Georgia (Mr. Kingston) who has worked tirelessly on the issue of expanding the number of bankruptcy judges we have to meet this need. Mr. Speaker, at this point I will place additional information on the bill in the Record. During the course of the Senate Judiciary Committee's consideration of S. 256, a provision was added to deal with excessive retention bonuses, severance payments and other forms of inducements paid by a debtor to retain key personnel or otherwise induce a debtor's management to remain with the debtor. This provision addresses serious conserns and I support the intent of its drafters. Nevertheless, this provision should not be construed to invalidate all key employee retention programs for companies that may someday wind up in Chapter 11. It is very important that a Chapter 11 debtor be able to retain management that is dedicated to maintaining the company's value for the benefit of its creditors, investors, employees, and other stakeholders. All too often, companies that fail to reorganize successfully are converted to Chapter 7 for liquidation, where creditors receive pennies on the dollar and employees face job dislocation. Where appropriate, key employee retention programs may be necessary to bring a company in financial distress successfully through the Chapter 11 process. Accordingly, section 331 of S. 256 should not be applied to invalidate such programs where there is no evidence of insider negligence, mismanagement, or fraudulent conduct contributed to a company's insolvency--in whole or in part. Given the possibility that the intent of the Congress with respect to this provision and the interpretation of Section 331's text may not be consistent, legislation clarifying language may be necessary. If so, I will work with my colleagues in the House and Senate to address any such inconsistencies. I ask that a letter from the Association of Insolvency and Restructuring Advisors be printed at this point in the Record. Association of Insolvency, and Restructuring Advisors, Medford, OR, March 1, 2005. Senator Arlen Specter, Chairman, Committee on the Judiciary, U.S. Senate, Washington, DC. Dear Mr. Chairman: The undersigned are financial and legal professionals who serve as the Board of Directors of the Association of Insolvency and Restructuring Advisors (AIRA). As board members we work to further the AIRA's goal of increasing industry awareness of the organization as an important educational and technical resource for professionals in business turnaround, restructuring, and bankruptcy practice, and of the Certified Insolvency and Restructuring Advisor (CIRA) designation as an assurance of expertise in this area. We write to make you aware of serious concerns we have regarding a provision contained in S. 256, the ``Bankruptcy Abuse Prevention and Consumer Protection Act of 2005.'' The provision in question effectively prohibits the use of key employee retention plans in Chapter 11 reorganizations. It was added during the Judiciary Committee mark-up of the bill and elicited little attention at the time. However, we believe this provision will cause considerable harm to a number of companies that will become subject to bankruptcy proceedings, and, most importantly, to their employees, customers, and creditors. When a company is operating in Chapter 11, a primary responsibility of management is to maintain and grow the company's value for the benefit of all of its stakeholders. A company that is well-managed through its restructuring benefits its creditors, employees, retirees, unions and the local communities of which the company is a part. Companies that fail to successfully reorganize in Chapter 11 are liquidated. Creditors receive pennies on the dollar and employees see their jobs and retirement savings destroyed. When companies enter Chapter 11, it is critical that they attract and retain top management talent. But Chapter 11 is also the most difficult time to attract and retain such talent. Managers of Chapter 11 companies are faced with intense scrutiny, stress, insecurity, and an enormously complex process. Compensation and incentive tools used by non-bankrupt companies such as equity compensation programs are not available to assist with attracting and retaining the type of management talent necessary to bring the company successfully through the Chapter 11 process--this is because the pre-petition equity is almost always without value. Key employee retention plans (``KERPs'') have become common practice since the early 1990's and have been viewed by courts, debtors, and creditors alike as an important and useful way to help reorganization by retaining key employees. Bankruptcy courts have agreed with this reasoning, and many judges have used their judicial discretion to approve KERPs. For a court to approve a KERP under existing law, however, a debtor must use proper business judgment in formulating the program, and the court must find the program to be reasonable and fair. Creditors have the right to object to proposed KERPs, and judges are presented with a full evidentiary record upon which to make a determination. If a KERP is not appropriate or if it is not in the best interest of the company's creditors, the judge can refuse to approve it. In the last few years, there has been a trend, with which we agree, towards stricter judicial scrutiny of proposed KERPs by bankruptcy judges. Such a trend seems appropriate in the wake of numerous high profile bankruptcy filings where management's misconduct or mismanagement has led to the Chapter 11 filing. Judges have discretion to deny KERPs in these circumstances, and they do so when the facts and circumstances warrant. Unfortunately, S. 256 as reported by the Senate Judiciary Committee includes an amendment authored by Senator Edward M. Kennedy (the Kennedy amendment) that places significant limits on retention bonuses and severance payments to employees of companies in Chapter 11. It would prohibit a bankruptcy judge from approving retention bonuses in every Chapter 11 case unless he or she finds that the company in question has proven that the employee has a bona fide job offer at the same or greater rate of compensation; was prepared to accept the job offer; and the services of that employee are ``essential to the survival of the business.'' The amendment also places significant caps on the amount of such bonus and payments. The Kennedy amendment appears to be motivated by a desire to combat KERPs in Chapter 11 cases where employee-related fraud substantially contributed to the bankruptcy of the company. Yet, by painting with such a broad brush, the Kennedy amendment will, if enacted, effectively eliminate all companies' ability to ever receive court approval for a KERP. Federal bankruptcy judges would have little or no discretion to approve KERPs. In turn, bankrupt companies would have less flexibility in trying to retain or attract necessary employees. This result will cause considerable harm to companies in bankruptcy, their employees, and their creditors. It is apparent that the Kennedy amendment is designed to prevent abuses of the system, where creditors', employees' and retirees' monies are unnecessarily expended for the enrichment of management. Whether there currently is or is not sufficient judicial scrutiny of KERPs is a valid question, insofar as the overall bankruptcy system allows debtors a fair amount of flexibility in exercising reasonable judgment--but there must be an approach better than handcuffing the judiciary and stakeholders in bankruptcy cases by essentially precluding all use KERPs. The proper use of KERPs requires an analysis of all facts and circumstances of the case, and not what is essentially a blanket proscription of these tools. Senator Kennedy has advanced an important public policy discussion with his amendment. Managers who have had responsibility for driving a company into bankruptcy should not be paid a bonus to remain. Similarly, if the retention of an employee would not enhance a company's value for its stakeholders, they should not be paid a bonus to stay. Current law provides bankruptcy judges with the discretion necessary to deny a KERP in such circumstances and bankruptcy judges do deny KERP payments in these circumstances. Still, if the Congress wishes to improve the operation of current law while still safeguarding the ability of the courts to approve legitimate KERPs, we would welcome a discussion on how best to achieve that end. Unfortunately, S. 256, as reported by the Committee, goes too far and should be amended so as not to unnecessarily limit the bankruptcy court's ability to determine what is in the best interest of each individual bankruptcy estate. Mr. Chairman, we thank you for considering our views on this important matter. We would be pleased to address any questions you or other members of the Committee on the Judiciary may have. Sincerely, The members of the board and management of the Association of Insolvency and Restructuring Advisors. Soneet R. Kapila, CIRA, Kapila & Company; President, AIRA. James M. Lukenda, CIRA, Huron Consulting Group; Chairman,

Mr. CANNON

Mr. CANNON. Mr. Speaker, to understand the need for S. 5, we need to understand the game the class action lawyers play here and how they go about abusing the court systems. I call it Class Action Monopoly. Here is how it works. They start at Go. The first thing they do is come up with an idea for a lawsuit. And then they find a named plaintiff. It does not have to be someone who is actually injured in the process. All the lawyer really needs is an idea for a lawsuit and potential defendants who have deep pockets. Next they find a person who is the named plaintiff. That named plaintiff is a citizen of the same State as one of the defendants and that puts them in the State court, which is where they want to be. Sometimes they have to promise to pay off that named plaintiff at this point, but that is all part of the game. Next the lawyers level their allegations, both in court and in the media. Remember, they do not have to have proof for their allegations. They just need a forum in which to make the allegations. Now the real fun begins after you have made the allegations. They are in State court with the named plaintiffs and their allegations, and it is time to get out of rule 23 free. Rule 23 is the rule that would apply in Federal courts that defines when a class action can be certified consistent with fundamental fairness and due process considerations. But in this game, there is no fairness. There is no due process. So they easily convince their magnet State to certify that they have a class and at the same time they file copycat lawsuits in State courts all over the country. These are the same class actions asserting the same claims on behalf of the same people. These copycat lawsuits clog the State courts. At this point in the game, the lawyers start making the money. Let us see where the money goes. In the Columbia House record case, the lawyers took home $5 million and the plaintiffs got a coupon for discounts on future purchases of records. In the Blockbuster case, the lawyers walked away with $9.25 million, and the plaintiffs again got a coupon for $1 off their next video rental, coupons that the defendant probably would have issued anyway. In the Bank of Boston case, the lawyers settled the case and took home $8.5 million. And the customers had money deducted from their mortgage accounts to pay off the lawyers. So in the end, a State court approved these cases, and all of the consumers in the lawsuit lost money. People may be wondering what happens to them in this game. We already know that if one is a consumer, in the consumer class, they will be lucky if they get a dollar-off coupon. If the business one works for gets sued in one of the class actions, their employer is going to take a major hit and maybe even lay them off. It is that clear in some of these cases, the basic result is that the lawyers will get lots of money, but consumers will pay because health care and car insurance premiums will go through the roof. And when the game comes to an end, they are left with no money and the lawyers are at ``go'' and they get to start the process all over again. It is fundamentally important that we resolve this problem and help America move forward. I urge support of S. 5.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today in support of the rule on H.R. 418. Our Nation's immigration policy has been of top concern in recent years, and for good reason. With between eight and twelve million illegal aliens in the United States, it is obviously a problem out of control. We need to increase border security and fix our immigration laws. We need a system that will encourage well-intentioned, contributing aliens out of the shadows and allow them to pay a reasonable penalty so they can come into compliance with the law. Americans are rightly concerned about the security and the integrity of the Nation's borders because the system is broken. Some are concerned about the possibility of terrorists crossing our borders and coming into our cities. But we cannot effectively fight terrorism if we fail to make the distinction between them and busboys and housekeepers. From 1990 to 2000, the number of U.S. Border Patrol agents nearly tripled, but illegal immigration increased by as much as 5.5 million. Increasing enforcement resources to keep out willing immigrant workers, as we did throughout the 1990s, has not worked. It has failed, and we need enforcement to be much more narrowly focused on criminals and potential terrorists. Today, we are considering H.R. 418. This legislation begins the debate on the enforcement aspects of immigration and addresses the narrow issue of driver license security. I have reservations about the gradual move toward what could become a National ID card, but this legislation begins to address issues necessary to focus efforts in enforcement. Mr. Speaker, I intend to vote in favor of H.R. 418, but while doing so, I suggest that enforcement, border security and immigration reform must be worked on together. In fact, fixing the broken system requires a broader strategy that includes both enforcement and the creation of adequate legal channels for immigration that serve the Nation's interests. By creating legal channels for those looking for a better life and looking to fill jobs that Americans will not fill, we enhance our enforcement efforts. The responsible authorities can focus their resources first on the worst actors. Our immigration laws and policies must reflect the realities we face today. Our economy demands workers, but our national security demands that we identify those lurking in the shadows. Enhanced enforcement must be the top priority for immigration policy. The American people are not anti-immigrant. We are concerned about the lack of coherence in our immigration policy and enforcement. As part of today's debate, we must realize that the Congress needs to address the other issues with immigration reform now. Broader immigration reform has been outlined by President Bush. I commend him for his act of leadership. He has outlined the solution and now Congress must act quickly in crafting legislation. This bill is our first step in a long journey to restore public confidence in an open, welcoming immigration code. Let Us Give Thanks to Our Immigrants [From the Wall Street Journal, Nov. 24, 2004] (By Rupert Murdoch) When B.C. Forbes sailed for America from Scotland in 1904, he was following a course well worn by generations of Scots. I know how the founder of Forbes magazine must have felt. The Murdochs originally hail from the same part of Scotland. Today, we are part of the most recent wave of immigrants attracted by the bright beacon of American liberty. These days, it's not always easy to talk about the benefits of immigration. Especially since 9/11, many Americans worry about borders and security. These are legitimate concerns. But surely a nation as great as America has the wit and resources to distinguish between those who come here to destroy the American Dream--and the many millions more who come to live it. The evidence of the contributions these immigrants make to our society is all around us--especially in the critical area of education. Adam Smith, another Scotsman, knew that without a decent system of education, a modem capitalist society was committing suicide. Well, our modern public school systems simply are not producing the talent the American economy needs to compete in the future. And it often seems that it is our immigrants who are holding the whole thing up. In a study on high school students released this past summer, the National Foundation for American Policy found 60 percent of the top science students, and 65 percent of the top math students, are children of immigrants. The same study found that seven of the top award winners at the 2004 Intel Science Talent Search were immigrants or children of immigrants. This correlates with other findings that more than half of engineers--and 45 percent of math and computer scientists--with Ph.D.s now working in the U.S. are foreign born. It's not just the statistics. You see it at our most elite college and university campuses, where Asian immigrants or their children are disproportionately represented. And a recent study of 28 prestigious American universities by researchers from Princeton and the University of Pennsylvania found something startling: that 41 percent of the black students attending these schools described themselves as either immigrants or children of immigrants. The point is that by almost any measure of educational excellence you choose, if you're in America you're going to find immigrants or their children at the top. I don't just mean engineers and scientists and technicians. In my book, anyone who comes here and gives an honest day's work for an honest day's pay is not only putting himself closer to the American Dream, he's helping the rest of us get there too. As Ronald Reagan said at the Statue of Liberty, ``While we applaud those immigrants who stand out, whose contributions are easily discerned, we know that America's heroes are also those whose names are remembered by only a few.'' Let me share some of these names with you. Start with Eddie Chin, an ethnic Chinese Marine who was born a week after his family fled Burma. You've all seen Cpl. Chin. Because when Baghdad fell, he was the Marine we all watched shimmy up the statue of Saddam Hussein to attach the cable that would pull it down. Or Lance Cpl. Ahmad Ibrahim. His family came to the U.S. from Syria when the first Gulf War broke out. Now Cpl. Ibrahim hopes to be deployed to Iraq--also as a Marine--to put his Arabic language skills in the service of Corps and Country. Or what about Cpl. Jose Gutierrez, who was raised in Guatemala and came to America as a boy--illegally! Cpl. Gutierrez was one of the first Marines killed in action in Iraq. As his family told reporters, this young immigrant enlisted with the Marine Corps because he wanted to ``give back'' to America. So here we have it--Asian Marines, Arab Marines, Latino Marines--all united in the mission of protecting the rest of us. Isn't this what Reagan meant when he said that the bond that ties our immigrants together--what makes us a nation instead of a collection of individuals--is ``an abiding love of liberty''? So the next time you hear people whining about what a ``drain'' on America our immigrants are, it might be worth asking if they consider these Marines a drain. Maybe this is more clear to businessmen because of what we see every day. My company, News Corporation, is a multinational company based in America. Our diversity is based on talent, cooperation and ability. Frankly it doesn't bother me in the least that millions of people are attracted to our shores. What we should worry about is the day they no longer find these shores attractive. In an era when too many of our pundits declare that the American Dream is a fraud, it is America's immigrants who remind us--by dint of their success--that the Dream is alive, and well within reach of anyone willing to work for it. We are fortunate to have a president who understands that. Only a few days ago, the White House indicated that it intended to revive an immigration reform which the president had first offered before 9/11 and tried to revive back in January. Politically speaking, a guest-worker plan is no easy thing. But as President Bush realizes, we'll never fix the problem of illegal immigration simply by throwing up walls and trying to make all of us police them. We've tried that for a decade or so now, and it's been a flop. What we need to do first is to make it easier for those who seek honest work to do so without having to disobey our laws. Fundamentally that means recognizing that an economy as powerful as ours is always going to have a demand for more workers. Such a policy would benefit us all: It would help those who want nothing more than to work legally move out of the shadows. It would help our security forces stop wasting resources now spent on hunting down Mexican waitresses and start devoting them to tracking the terrorists who really threaten us. It would help the economy by providing America with the labor and talent it needs. Given the tremendous pressures on President Bush and the considerable opposition from within his own ranks, the politically expedient thing for him to do would be to drop it. But he hasn't, and I for one am encouraged by his refusal to give in. The immigrant editor B.C. Forbes spent much of the 20th century championing the glories of American opportunity. We who have arrived more recently likewise will never forget our debt we owe to this land--and the obligation to keep that same opportunity alive in the 21st. Mr. Murdoch is chairman and chief executive of News Corporation. This is adapted from a speech he gave last Thursday, in acceptance of the 2004 B.C. Forbes Award.

Mr. CANNON

Mr. CANNON. Mr. Chairman, I would like to submit a statement for the Record from the Americans for Tax Reform. February 9, 2005. Our nation's immigration and border control policies cry out for reform. While our best border control officers should be preventing the next terrorist incursion into our country, they are instead hunting down willing workers. The attacks of September 11th called for new and updated thinking in all areas of federal law enforcement, and immigration reform has been a glaring omission. America's immigration system must be reformed in a responsible, welcoming, adult manner along the lines laid out by President Bush. Willing workers should be matched with willing employers, citizenship and residency applications must be streamlined, and the focus must shift to protecting the nation from terrorists. Border security has been increased since 9/11, and should continue to be so. The latest technology must be used to make sure America's border is free of terrorist incursions. In order to let the border guard do their job of defending America, the President supports giving foreign laborers guest worker cards, ``to match willing workers with willing employers.'' President Bush is opposed to amnesty for illegal immigrants. He also does not want to give foreigners in the guest worker program any advantage over those who are trying to become citizens through normal, due process channels. Congress should support President Bush's common-sense plan to reform and strengthen America's broken immigration system even as border security is addressed today in the House of Representatives. Grover Norquist, President.

Mr. CANNON

Mr. CANNON. Mr. Speaker, first, I would like to commend the House and Senate for passing the 3 year extension on the moratorium for Internet taxes and the President for signing the bill last Friday. I am pleased that we were able to extend the moratorium, I agree with the gentleman from Wisconsin, the Chairman of the Judiciary Committee, that the moratorium should be made permanent. I look forward to working with him and others next year to achieve this very important goal. Second, for clarification purposes on the grandfather of states that tax Internet access, I wish to offer an explanation distinguishing the difference between the pre-October 1998 and pre-November 2003 dates as found in Section 1104. While both sections use the term ``Internet access,'' Section 1104(a), the provision for pre-October 1998 taxes, applies only to the states that were lawfully taxing Internet access before the original enactment of the Internet Tax Freedom Act in 1998. The definition of ``Internet access'' that applies to the Section 1104(a) grandfather clause is the definition as set forth in the 1998 Internet Tax Freedom Act, as the amended definition does not take effect until November 1, 2003. Those states that were grandfathered under the Internet Tax Freedom Act from 1998 to 2003 will continue to be grandfathered under Section 1104(a). Section 1104(b), the provision for pre-November 2003 taxes, applies only to those states that were taxing telecommunication services purchased, used, or sold by an Internet access provider to provide Internet access, such as Digital Subscriber Line (DSL) access technology, if they were doing it lawfully prior to November 1, 2003. The amended definition of ``Internet access'' in the Internet Tax Freedom Act is effective November 1, 2003 and applies to section 1104(b). Section 1104(b) expires November 1, 2005 in order to eliminate any ``tax on Internet access'' (as defined in Section 1104(10)) regarding telecommunications services purchased, used or sold by an Internet access provider for the purpose of providing Internet access. Finally, in making the Internet Tax Freedom Act technology neutral, this law now protects consumers from taxes on all Internet access technologies, including dial-up, DSL, cable modem, satellite and wireless. A consumer may even purchase Internet access from two Internet access providers without the threat of taxes. He may use one service to browse the Internet and the other service primarily for e- mail and content services. Both Internet access services are protected from state and local taxation under this law. This law is a significant accomplishment on behalf of all American consumers and maximizes consumer choice and access.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I am today introducing legislation to clarify Public Law 104-95, adopted by the Congress in 1995, prohibiting States from taxing the retirement income of nonresidents. That law was enacted in response to actions of some States which were aggressively seeking to tax nonresidents on retirement income from past employment in that state. The Congress felt that State taxation of nonresidents' retirement income was unfair and imposed an unreasonable burden on nonresident retirees. The law defines ``retirement income'' as any income from specified types of qualified pension plans or from a nonqualified deferred compensation plan that meets certain payment requirements. Nonqualified deferred compensation plans are defined by reference to section 3121(v)(2)(C) of the Internal Revenue Code (the ``Code'') which relates to employment taxes. Specifically, any income of an individual who is not a resident of the taxing State from any plan, program, or arrangement described in section 3121(v)(2)(C) is exempt from that State's income tax, provided the income received from such plan is part of a series of substantially equal periodic payments made--no less frequently than annually--over the life expectancy of the recipient, or for a period of not less than 10 years. I think the intent of the law is clear, but I am aware that a question could arise regarding state taxation of nonqualified retirement benefits paid by a partnership to its retired nonresident partners. Specifically, the concern is that the reference to section 3121(v)(2)(C) of the Code could be construed to limit the exemption to payments made only to retired employees--i.e. those individuals subjected to FICA tax--since that provision is written in the context of employment taxation. Under this view, nonqualified retirement benefits paid by a partnership to its retired nonresident partners would not be exempt from nonresident state income taxation because there is no specific reference to self-employed individuals in the Public Law 104-95, section 3121(v)(2)(C) of the Code, or subsequently issued Treasury Regulations for that section. The bill makes it clear that section 3121(v)(2)(C) was meant to define nonqualified deferred compensation income, irrespective of whether the recipient was subject to FICA tax, by specifically including self-employed plans or arrangements. The rationale for applying the statute's exemption for employee retirement income applies equally to retirement income of an independent contractor or partner. Given the fact that the bill is intended to clarify what has been the intent of the bill all along, it applies as of the effective date of Public Law 104-95, i.e., to amounts received after December 31, 1995.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today in support of H.R. 3982. Mr. Speaker, due to pressing family matters, I was unable to be present on the floor while this bill was being considered. I want to go on record today strongly supporting this bill and want to thank the house for unanimously supporting this legislation. H.R. 3982 directs the Secretary of Interior to convey certain land held in trust for the Paiute Indian Tribe of Utah to the City of Richfield, Utah. This legislation is a win-win for all involved. The bill has three major sections. First the Paiute Indian Tribe would sell a three-acre parcel to the City of Richfield. The Paiute Tribe has owned this land since 1974 and it has not been utilized by the Paiute Tribe for more then 20 years. This parcel will be used by the City to expand their municipal airport. Second, the Paiute Tribe will transfer two parcels of an acre or less to the Kanosh Band. These two parcels are surrounded by 279 acres of land either owned by the Kanosh Bank or held by the United States in trust for the Kanosh Band. The sole use of one of the land parcels has been the Kanosh Band Community Center. The other parcel was originally intended to be taken by the United States in trust for the Kanosh Band of Paiute Indians in 1981, however, an administrative error mistakenly placed this land parcel in trust for the Paiute Tribe. The Kanosh Band has requested that this error be corrected in 1983, 1984 and 2002. Finally, the Paiute Tribe would transfer a one-acre parcel that is held in trust by the United States for the Paiute Tribe to the Shivwits Band of Paiute Indians. This one-acre parcel is located at the Shivwits Indian Village, surrounded by several thousand acres of land held by the United States in trust for the Shivwits Band. The sole use of this land parcel for more then 20 years has been the Shivwits Band Community Center. Mr. Speaker, I thank you and my other colleagues for supporting this important piece of legislation.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today in support of H.R. 3391. Mr. Speaker, due to pressing family matters, I was unable to be present on the floor while this bill was being considered. I want to go on record strongly supporting this bill and want to thank the House for unanimously supporting this legislation. H.R. 3391 authorizes the title transfer of certain features of the Provo River Project--including the Provo Reservoir Canal, as well as the Salt Lake Aqueduct and certain land in Pleasant Grove, Utah, from the Bureau of Reclamation to non-federal ownership. For the past 60 years the Provo River Water Users Association has operated the Provo Reservoir Canal, also known as the Murdock Canal. As long as the title remains in the name of the federal government, the water users association and local communities who use the water are unable to obtain the tax-exempt financing necessary to properly improve and manage the canal. Passage of this title transfer will now allow that to happen. There are additional benefits to this legislation. For example, significant water efficiencies will result from title transfer. Approximately 8 percent of the water is lost each year to evaporation and seepage since the canal is not enclosed. Transferring ownership will allow it to be enclosed. There are environmental benefits as well--for instance, some of the saved water will be made available to meet the needs of the endangered June sucker. Further, covering the canal will also allow for the development of recreational trails that can be used for hiking and cycling. Mr. Speaker, I thank you and my other colleagues for supporting this important piece of legislation.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent to take from the Speaker's table the Senate bill (S. 2895) to authorize the Gateway Arch in St. Louis, Missouri, to be illuminated by pink lights in honor of breast cancer awareness month, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that the Committee on Resources be discharged from further consideration of the Senate bill (S. 524) to expand the boundaries of the Fort Donelson National Battlefield to authorize the acquisition and interpretation of lands associated with the campaign that resulted in the capture of the fort in 1862, and for other purposes, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on H.R. 2714.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent to take from the Speaker's table the Senate bill (S. 2883) to amend the International Child Abduction Remedies Act to limit the tort liability of private entities or organizations that carry out responsibilities of the United States Central Authority under that Act, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent to take from the Speaker's table the bill (H.R. 2714) to reauthorize the State Justice Institute, with a Senate amendment thereto and concur in the Senate amendment.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent to take from the Speaker's table the Senate bill (S. 2195) to amend the Controlled Substances Act to clarify the definition of anabolic steroids and to provide for research and education activities relating to steroids and steroid precursors, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on S. 2883.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that the Committee on the Judiciary be discharged from further consideration of the bill (H.R. 4917) to amend title 5, United States Code, to authorize appropriations for the Administrative Conference of the United States for fiscal years 2005, 2006, and 2007, and for other purposes, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on H.R. 4917.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that the Committee on the Judiciary be discharged from further consideration of the Senate bill (S. 2864) to extend for eighteen months the period for which chapter 12 of title 11, United States Code, is reenacted, and ask for its immediate consideration in the House.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on S. 2864.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days within which to revise and extend their remarks and include extraneous material on S. 2195.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise to urge my colleagues to support H.R. 4306, legislation that I introduced along with the gentleman from New Jersey (Mr. Andrews). I would like to thank the gentleman from Wisconsin (Mr. Sensenbrenner) and the gentlewoman from Texas (Ms. Jackson-Lee), ranking member of the subcommittee, for their support of this bill. This is a noncontroversial bill that reinserts logic into the regulatory process by updating an outdated regulation. The Immigration Reform and Control Act of 1986 requires the Employment Eligibility Verification form, also known as the I-9 form, to be completed and stored by an employer in order to verify the employment eligibility and identity of the employer's workforce. The statute also stipulates that all employers must maintain these documents for at least 3 years after the date of hire or 1 year after employment is terminated, but many employers maintain the forms for longer periods of time simply because of the cost to audit the files every year. But, Mr. Speaker, the real regulatory burden occurs with the accompanying regulations. These regulations require that the employer must retain the forms ``in their original form, either paper or on microfilm or microfiche.'' When these regulations were promulgated, microfiche was in the stratosphere of technological progress, but to place this in proper perspective, these regulations went into effect 5 years before Adobe Acrobat was invented. With new technology available today, it is vitally important that the Congress streamline burdensome and outdated regulations. The House Corrections Day Advisory Committee was implemented to fix such things. H.R. 4306 went before the Correction Committee, a bipartisan committee cochaired by the gentleman from Michigan (Mr. Camp) and the gentleman from California (Mr. Waxman), and received the committee's blessing that this legislation should receive consideration and passage because it rectifies an outdated regulation. The need for this legislation is evidenced by the hundreds of millions of records that are stored in warehouses across the country in order to comply with the IRCA regulations. All businesses, especially those with high employee turnover, have a burden maintaining these documents in storage all over the country. Most companies do not use microfiche, so they are inundated with reams of paper to file and maintain. Some companies ship all their forms to one centralized location while others maintain the document where an individual is originally hired, even if he is transferred, causing audits to be complex and inefficient. The nonuniform method causes burdens to the employers and the investigators who may need to access specific files. This legislation enhances security and provides greater privacy protections for employees. Electronic computer storage with backup systems is far more secure than paper-based systems in which the paper documents can be lost, damaged, misfiled or accessed by unauthorized individuals. The automatic time and date stamping of documents which occurs on automated systems will also help prevent fabrication or tampering. It is our intent to provide employers a more practical option to meet their obligations. By permitting these forms to be completed and stored on a computer rather than simply on paper, an employer can avoid unnecessary administrative and storage costs. This will allow employers to reinvest the savings, benefiting the broader economy through the creation of new jobs. In addition to allowing the electronic completion and storage of the I-9 forms, this legislation also allows employers to convert existing I-9 forms into electronic versions for storage purposes. An employer who continues to use paper I-9 forms with handwritten signatures should be able to convert those forms into an electronic version for storage and security purposes. Mr. Speaker, this legislation does not mandate anything new. It allows employers to adopt electronic completion and storage of I-9 forms if they so choose. For a small employer with few employees and a few new hires per year, the paper route may be the most logical. But in the industries with high employee turnover, electronic completion of I-9 forms will save time and money and help in enforcement. I would like to thank the staff that worked on this bill. Personally I would like to thank from the Committee on the Judiciary Phil Kiko, Joseph Gibson, Art Arthur, George Fishman, Perry Apelbaum, and Nolan Rappaport; from leadership, Brett Loper and Andrew Shore; and Robert Knotts from the staff of the gentleman from New Jersey (Mr. Andrews); and Todd Thorpe and Matthew Iandoli from my staff. Mr. Speaker, I urge my colleagues to support this legislation.

Mr. CANNON

Mr. CANNON. Mr. Speaker, today the House of Representatives is acting well within its Constitutional authority in considering H.R. 3313. Currently, many state courts including those in Massachusetts have begun the process of defining marriage through judicial decree. Because of the Constitution's Full Faith and Credit Clause, this judicial activism may be forced upon all the remaining states, including Utah, undermining the traditional definition of marriage and family. These and other state and federal courts imperial judges are acting in an extra-constitutional fashion and assuming the powers of legislatures. In Massachusetts, the Supreme Judicial Court of Massachusetts ruled on a 4-3 vote in Goodridge v. Massachusetts Dep't of Health, 798 N.E. 2d 941 (Mass. 2003) that the state's refusal to issue marriage licenses to same-sex couples violated the state constitution. The court found that the traditional definition of marriage, the same definition used throughout history, was evidence of ``invidious'' discrimination. In a follow-up opinion, these same judges stated the current definition of marriage in Massachusetts was a ``stain'' on the state constitution and needed to be ``eradicated''. On May 17th of this year, the Goodridge decision went into effect and the state of Massachusetts began issuing same-sex marriage licenses. This new and expanded definition of marriage opens many more questions than it answers. What happens if these individuals move to other states after they are married? What benefits and rights must the new jurisdiction accommodate and what other obligations will be thrust on a jurisdiction that does not recognize such unions? These are difficult and divisive questions, and this is why representatives elected by the people and not the courts should decide them. Those opposed to an open and deliberative debate and public votes by elected legislators have preferred judicial activism instead. The Defense of Marriage Act, which passed both Houses of Congress and was signed into law by President Clinton, is central to our debate. DOMA was passed to prevent one state from imposing its family law policy on another state. Historically, family law has always been left to the states. However, scholars on both sides of the ideological aisle have stated their Constitutional concerns with the language of DOMA. If DOMA challenges are successful, then one case in one court could conceivably set social policy for the nation. When the judicial branch loses its moral compass, it is the responsibility of the Congress to exert its authority to keep the judicial branch in check. In this particular circumstance, the Congress has two options. The first is a Constitutional Amendment. The second is assertion of its authority in the Constitution under Article III, Section 2 clause 2 and ``regulate'' the jurisdiction of the federal courts and make ``exceptions'' to their jurisdiction. I have reservations about amending the U.S. Constitution. But that may be our last resort. As President Bush stated, ``If judges insist on forcing their arbitrary will upon the people, the only alternative left to the people would be the constitutional process.'' I agree with President Bush. We are debating H.R. 3313, which limits the role of federal courts. This legislation states, ``No court created by an act of Congress shall have any jurisdiction, and the Supreme Court shall have no appellate jurisdiction, to hear or decide any question pertaining to the interpretation of, or the validity under the Constitution of, section 1738C.'' The referenced section relates to the DOMA language allowing states to opt to not recognize the same-sex marriages of another state. HR 3313 is simply Congress reaffirming its intent under DOMA and disallowing judicial review. Some argue that Congress should not limit the jurisdiction of the federal courts. I would like to remind them of the provision Senator Daschle inserted into a Defense Appropriations bill in the 107th Congress that exempted all forest management projects in the Black Hills National Forest from any further NEPA requirements, from administrative appeals, from Endangered Species Act Section 7 consultation procedures, from review by any court, and from court ordered injunctions. I agreed with Senator Daschle and supported this legislation not only because it set a precedent for good forest policy, but also because it is a precedent for Congress's authority to limit the jurisdiction of the courts. Chief Justice Marshall inferred in Marbury v. Madison that if the Supreme Court identifies a conflict between a constitutional provision and a congressional statute, the Court has the authority to declare the state unconstitutional. It is clear that Congress has the duty and responsibility to make sure that no act promulgated by it exceeds the Constitution. In this particular case, the Congress is exerting its explicit authority to limit the jurisdiction of the Courts. This cannot be held unconstitutional by the federal courts or the Supreme Court because they cannot hear it. They have no jurisdiction because Congress withholds jurisdiction. It is the natural check on the courts' power that the founding fathers built into our system of checks and balances. I say with all sincerity to those opposed to this legislation, the spirit of the law is explicit. State family law is for the states to decide. The Supreme Court in a 2004 decision, Elk Grove Unified School District v. Newdow, 124 S. Ct. 2301, 2309 (2004) (citing and quoting In re Burrus, 136 U.S. 586, 593-94 (1890)), reaffirmed this presumption by stating, ``the whole subject of domestic relations . . . belongs to the laws of the State and not to the laws of the United States.'' If the opponents of this legislation deny this reaffirmation of the law, a Constitutional Amendment to protect the definition of marriage is the only alternative. I urge a ``yes'' vote.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today to honor and recognize a Utah company for the help it has given to the recently freed people of Afghanistan. Overstock.com, founded in 1999, is one of Utah's best performing companies and a leader in liquidating excess inventory through the Internet. For nearly five years, Overstock.com has operated on principles of value investing and fair deals, which is why it has become a leader on the Internet. Overstock.com has also done great work abroad as well. Worldstock is the socially responsible goods department of Overstock.com that contracts with skilled craftspeople in developing countries and helps them sell their products. I am proud to say that this Utah based company is now Afghanistan's largest private employer. The Ministry of Commerce in Afghanistan reported that Worldstock has made it possible for 1,400 Afghans--90 percent of them women--to earn a living. This is a quite a feat, considering that just a few short years ago Afghanis, especially women, were living under the oppressive Taliban regime. In Afghanistan, Overstock.com has been able to utilize technology to provide employment for this developing country. Overstock.com has given Afghanis the skills needed for long-term business success. Additionally, Overstock.com has said that it will not make a profit of more than one percent on goods sold through its Worldstock division. This policy has allowed women, prevented from working under the Taliban regime, to now flourish. Global trade and commerce are now a reality to the Afghani people thanks in part to the efforts of Overstock.com. I would also like to recognize the founder and CEO of Overstock.com, Dr. Patrick Byrne. Being a three-time cancer survivor has not slowed down his altruism, productivity or creativity. It is Dr. Byrne's vision that drives Overstock.com and its work in Afghanistan. In 2003, Dr. Byrne hired Neelab Kaniska, an Afghan woman who fled her homeland when she was a child, to manage Worldstock. This position allowed Neelab to return to her native country and work with local artisans and provide them with the technological tools that now employ over 1500. Overstock.com and Dr. Patrick Byrne understand the importance of all markets whether it is the individual consumer, small business owner, or an artisan in a developing country. I applaud their efforts and their representation of Utah, American business, and the American spirit.

Mr. CANNON

Mr. CANNON. Mr. Speaker, I rise today to recognize the establishment of a new and innovative non-profit foundation whose sole objective is to rationalize and accelerate the transition of the Balkan countries to full market economies. The purpose behind the Balkan Organization for National Financial Development (BONAFIDE) is the promotion of U.S. investment in the region by facilitating the harmonization of the ethics, laws and regulations governing business, investment and the financial markets in these countries with those of the United States. History is clear, Mr. Speaker. The greatest speed, quality and durability of the transition to democracy in this culturally and politically complex region will not be achieved solely through diplomatic pressure and direct foreign assistance. Instead, this transition is best achieved through positive pressures developed within these economies through the positive participation our companies and institutions in legitimately participating in their growth. In the past, there was an accepted and established manner of conducting business and working with government in these countries that was, by most measures, corrupt. The reality is that the lack of laws promoted this weakness. Today, with anti-corruption laws in place, the lack of enforcement institutions and transparency are in some cases promoting the perpetuation of these practices. The situation is improving, but it is by no means where it needs to be. As I see it, we can sit on the sidelines and lament the corruption of the past and the present, or we can support constructive programs and look to the future. We can sit back and allow the other nations and their companies to participate in the tremendous economic potential in the region while imposing their own models of business ethics on these developing economies, or we can aggressively promote competitive U.S. investment and develop business ethics like ours. We need to help concentrated wealth achieved in a time when there was an absence of law transitioned into a framework of legitimate business. This is the purpose of the BONAFIDE organization. BONAFIDE is funded exclusively by business and industry in the Balkans, including companies and individuals from the banking, railroad, mining, petroleum, telecommunications, and agriculture industries, as well as individuals who see the clear benefits of a closer alignment with the United States and its economic principles and practices, such as leading financial institutions and corporations from the Republic of Serbia, Bosnia & Herzegovina, Republica Srpska and Bulgaria, as well as individuals who have come, not unscathed, through this period of vague law, such as Sorin Vintu of Romania. These companies and individuals are concerned that the concentration of investment from countries other than the U.S. will have the effect of stagnating reforms and, therefore, growth. They are now committed to the early adoption and implementation of regulatory and enforcement reforms and transparency in their countries on the U.S. model, not the German or Russian model. BONAFIDE, through its headquarters in Washington, will promote the accelerated harmonization of national laws, regulations and best business practices for the Balkans with those of the United States through an aggressive education exchange and cooperation program. BONAFIDE will facilitate collaborative working visits of U.S. legislators and regulators with their counterparts in the region; between leaders of industry, financial services and law and their counterparts in the Balkans; and of academic leaders with government, business and educational institutions in these countries. Mr. Speaker, I welcome the establishment of this new organization and organizations like it and I strongly support the objectives they promote.