Tom Daschle

Mr. DASCHLE

Mr. DASCHLE. I note the absence of a quorum.

Mr. DASCHLE. Mr. President, I object.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, in his thought-provoking book, ``The Faith We Have Not Kept,'' Senator Strom Thurmond writes: The nation that ceases to expand its consciousness begins to die at that very moment. Once a nation loses its conviction of truth, doubts, and self-doubts rob it of its will and its strength. During his 41 years and 10 months in the U.S. Senate, Senator Strom Thurmond has certainly helped ensure that this great Nation continues to expand its consciousness and to ensure that we never lose the conviction of truth. In so doing, he has helped our Nation continue to thrive and prosper and build its will and its strength. For these reasons, we admire as well as honor the man who this past Sunday, on May 25, became the longest serving Senator in the history of the United States. From the start, I want to make it clear I have not always agreed with the senior Senator from South Carolina. In fact, we probably disagreed more than we have agreed. But I also want to make clear that my disagreements with him have never once diminished my admiration for him as a man, as a lawmaker, and as an American. Never once have our differences reduced my respect for his tenacious fights for the causes in which he believes and his adherence to what he has called the bedrock for all our expectations, the Constitution of the United States. This historic achievement is another important milestone in the life and career of a man who has become a political icon of the South--a life and a career that has included: Being the first and only person to be elected to the U.S. Senate on a write-in ballot; Delivering the longest speech in the history of the Senate, 24 hours, and 18 minutes; and, Being the oldest person to have ever served here in the Senate. One might be inclined to think that being a Federal lawmaker is all that Strom Thurmond has ever done. Actually, he has done a few other things. He has been a farmer, a lawyer, a teacher, a coach, an education administrator, a judge, a Governor, a State senator, and an author. He is a soldier--a distinguished veteran of World War II who participated in the D-day invasion and has been awarded 5 military stars and 18 decorations. He has been a Democrat, a Dixiecrat, and a Republican. What a life. What a career. In addition to the skill and intellect, the doggedness and drive, and the other attributes that make for an outstanding senatorial career, Senator Thurmond's historic achievement marks the career of someone: Born before the birth of aviation--the year before the Wright brothers took off in their plane at Kitty Hawk; Elected to his first political office while Calvin Coolidge was President; Who began serving in the Senate before some of its current Members, including this one, were born; and Who has served with about one-fifth of the 1,843 men and women who have been Members of the U.S. Senate. For his long and distinguished career, the people of South Carolina are naming much of that State in Senator Thurmond's honor. Go to almost any town in his beautiful and beloved State and you will find Strom Thurmond Street or Bridge. You will similarly find named in his honor a high school in Edgefield County, a student center at Baptist College, a dormitory at Winthrop College, a criminal justice building at the Greenville Technical College, a Federal building in Columbia, the Center for Excellence in Government at Clemson, an auditorium at the University of South Carolina School of Law, a mall in Columbia, and a vocational rehabilitation center in Aiken. You will also find Strom Thurmond Lake, Dam, and Highway in Clarks Hill, the Strom Thurmond Educational Center in Union, the Strom Thurmond Biomedical Research Center at the Medical University of South Carolina, and the Strom Thurmond Defense Finance and Accounting Building in Charleston. His office walls are covered floor to ceiling with awards too numerous to mention. The people of South Carolina are obviously pleased and proud of their man in Washington just as we are pleased and proud to have him here with us. It is interesting to note that the oldest and longest serving Member in Senate history has announced his support for term limits. After six decades in political office and four decades in the Senate, this may be the only way that he will ever leave the Senate. One of his staffers aptly pointed out that ``graveyards in South Carolina are filled with people waiting for Strom Thurmond to die so they could run for the Senate.'' Mr. President, I congratulate Senator Strom Thurmond for his remarkable career and his historic feat, becoming the longest serving Senator in U.S. history. I thank him for his contributions to the U.S. Senate, for his contributions in making this a better country, and for being a friend and a colleague. Finally, I thank him for expanding the consciousness of this great Nation and ensuring that we never lose our conviction of truth. I suggest the absence of a quorum.

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

Mr. DASCHLE

Mr. DASCHLE. Mr. President, I commend the President pro tempore, the distinguished Senator from South Carolina, [Mr. Thurmond]. As we will note when we come back, the distinguished Senator from South Carolina will mark a very important day on Sunday. That day will represent the first day he will have exceeded the time that anyone has had the good fortune to serve in the Senate. He will go down in history as having served longer than any other Senator, Democratic or Republican or, for that matter, any other party that has existed in our Nation's 220-year past. I congratulate and commend him. I look forward to having more of an opportunity when we return to call attention to his remarkable record and the success he has enjoyed. It has been my good fortune to work with him. While we differ on many issues, I certainly admire the extraordinary service he has provided this country. I congratulate him and his family on this remarkable achievement this weekend.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, it is my privilege today to honor Mary Niedringhaus of Brandon Valley, SD. Mary has been selected as Teacher of the Year in the Brandon Valley School District in recognition of two decades of outstanding teaching, guidance, and care that she has given the children of the community. I can think of few individuals more deserving of this prestigious award. A fifth grade teacher at Brandon Elementary, Mary's gift is her ability to recognize and meet the needs of each of her students. She conveys an excitement for learning that her students find infectious. Whether bright or struggling, students excel in Mary's class because she genuinely believes in each of them and draws out their best efforts. After hearing Mary's lesson on importance of ladybugs to people, one little girl was so excited that later in the day she rushed to Mary and presented her with a ladybug. As she explained breathlessly, she had just rescued it from being flushed down the toilet in the girls' bathroom. Mary holds herself and her students to the highest standards. Parents in Brandon seek to place their children in her classroom because they know that she will give them the finest education possible. Once, when planning a unit on South Dakota history for her students, Mary discovered that no good textbooks existed on the subject for grade school students. Undaunted, she developed her own curriculum based on materials she gathered on her own. Mary's curriculum is now the model used by all teachers in the Brandon Valley school district. No remarks about Mary would be complete without mention of the deep empathy she has for others. Brandon Elementary School Principal Marv Sharkey noted that Mary, ``has the knack of making parents feel like their child is the best kid in the world.'' Mary genuinely loves her students; I believe that this is the true source of her success as a teacher. Finally, it seems that Mary has done as a good of job raising her children as she has teaching her students. Her daughter, Nancy Erickson, is a longtime, invaluable senior member of my staff. Mary should be deeply proud of her. Mr. President, I commend Mary Niedringhaus for her exceptional work. Along with other district winners, she will now be considered at the State level for the South Dakota Teacher of the Year award. I wish her the best of luck as this process continues.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, I was not able to come to the floor as the Senator from North Dakota was expressing himself with regard to the disaster, and I know that the Presiding Officer, the Senator from Minnesota, [Mr. Grams], has worked long and hard to work with all of us as we have made the effort to address the extraordinary concerns, the extraordinary difficulties, and the extraordinary pain that people in Minnesota and the Dakotas have faced now for the better part of 6 months. First, the harsh winter months, cold and snow and ice in many cases precluded farmers from feeding their livestock, and in many cases caused the death of hundreds of thousands of livestock, only to be followed by floods and other spring disasters that have left many thousands of people homeless in all three States. After visits which the President, the Vice President, the Speaker, the House majority leader and others, there was a national commitment to address this problem and to find ways in which to help these people as quickly as we possibly could. There were editorials written about the great bipartisan effort that was made in order to do all we could to address the matter in an expeditious and comprehensive manner. I am very saddened by what has happened in the last 48 hours. I am troubled by the fact that there are those who still wish to use the effort to provide this assistance to people who need it so badly as the vehicle for an agenda that has nothing to do with the disaster, as a vehicle to address other needs, other concerns that may or may not be legitimate but have absolutely no reason for being associated with this bill, have absolutely no reason for being attached to this legislation. I am troubled that anybody would use the kind of cynical approach to hinder our efforts to find ways with which to address this problem as quickly and as seriously as we possibly could. We have no business leaving the Senate and leaving the House under these circumstances. I give great credit to the majority leader as he comes to the floor, because I do believe he made every effort to try to address this problem as successfully as he could. I know he has attempted to find ways in which to extract those problematic provisions from the bill. I know of his efforts yesterday. I am very disappointed that even with his efforts we failed. I also applaud the distinguished chairman of the Appropriations Committee. Senator Stevens has done great work in attempting to find ways with which to address this problem. So I must say, Mr. President, on a bipartisan basis I believe our body has done a great deal in attempting to avert the extraordinary calamitous circumstances that we are facing right now. It is going to be very difficult to go home, as I will, to speak to the people of Watertown, SD, not only on Memorial Day but at their high school commencement this year and explain what happened, explain why this Congress has left town without completing its work on this very important matter. Mr. President, there are no words to describe how badly some of us feel, how frustrated, exasperated, and angered we are at these circumstances. We can only hope that upon our return, these political games and these ploys that have nothing to do with this legislation can be averted and we can deal with them far more effectively and address it in a comprehensive way. At that time, we will still, as late as it will be, give people hope that we understand their pain, that we understand their circumstance, and that we will respond as we best know how to do. It is only that hope that allows me with a very heavy heart to leave this town with our work incomplete. Mr. President, I hope all of us will redouble our efforts as soon as we return. Let us get the job done. Let us do it right. Let us do it understanding completely how difficult a circumstance people in our States and States around the country must now face. I yield the floor.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, this is an historic occasion. This budget outline is the first plan Congress has produced in 28 years to balance the budget. I want to thank all of those who worked so hard to get us to this point, including the President and Vice President, Erskine Bowles, Frank Raines, John Hilley and others at the White House, Senators Frank Lautenberg, ranking member of the Senate Budget Committee, House minority leader Dick Gephardt and John Spratt. I also want to thank our partners across the aisle: Senate majority leader Lott, Senator Pete Domenici, chairman of the Senate Budget Committee, Speaker Gingrich and Congressman John Kasich. And all the staff, in both houses, the administration and including my own, who have worked so diligently to complete this agreement. Finally, I want to thank two former colleagues, Senators Jim Sasser and Harris Wofford, who were defeated for re-election in 1994--in no small part because they supported the 1993 deficit reduction plan. Without that plan we would not be here today. Because of that plan, we've been able to cut the budget deficit by 75 percent. In less than 5 years, we've gone from a $280 billion deficit to a $67 billion deficit. The U.S. economy has added more than 12.5 million new jobs, and 3 million small businesses. Our economy is now growing at a virtually unparalleled rate of 3.5 percent a year. Unemployment is at its lowest level in 24 years. Young people graduating from college this month are entering one of the best job markets in years. That's a remarkable record of progress. I support this budget resolution because it builds on that progress. Make no mistake: This budget plan is not the culmination of the Contract With America. It is, in some fundamental ways, a repudiation of that contract. Where the contract targeted tax relief to those who needed it least, this budget agreement targets it to those who need it most. Where the contract would have left Medicare to wither on the vine, this agreement extends the solvency of the Medicare trust funds for a decade. Where the contract represented a declaration of war, this resolution is instead a declaration of principles. There is a difference between a budget that slashes and burns to get to zero, and a budget that is truly balanced. This resolution--if we adhere to it--will result in a balanced budget that addresses not only our financial deficit, but our investment deficit as well. This budget plan sets aside $35 billion in education tax relief, to help working families pay for college and job training. This plan will provide health insurance for 5 million children--half of the uninsured children in America. This plan extends the life of Superfund, so we can clean up the environmental mistakes of our past, and it invests in environmental safeguards, so we can avoid mistakes in the future. This budget keeps Medicare solvent for another decade--without gouging senior citizens who depend on the program. It is a good deal. But it is not a done deal. We still have a long way to go before this declaration of principles is translated into an actual budget--13 individual appropriations bills, plus a reconciliation bill. We know full well, from the last Congress, how difficult these next steps can be. It is my hope that we will also remember the painful consequences of refusing to take those steps. As long as the commitments we have received now in writing are honored, we will proceed in good faith toward reconciliation. That does not mean, however, that we will be passive observers of this process. Any attempt to undermine our agreement and skew the tax relief to benefit disproportionately those who need tax relief the least will be met with forceful opposition. So will any effort to shortchange our agreement on education tax credits and children's health insurance. The time for negotiations on these priorities is over. There is more than enough money, and flexibility, in this budget plan to honor these important commitments. There is also enough room in this framework to accommodate our proposal to help communities rebuild crumbling schools, and replace obsolete schools. According to the Government Accounting Office, one-third of all schools--serving 14 million children--require extensive repair or replacement. Almost 60 percent of schools have at least one major structural problem, from sagging roofs to cracked foundations. About half have unhealthy environmental conditions, such as poor ventilation or inadequate heating. Half lack the basic electrical wiring needed to connect them to the information superhighway. It is wrong for us to hobble future generations with the debts of this generation; that is why we are taking these steps to eliminate the deficit. But it is equally wrong to deny future generations the basic tools they will need to make a life for themselves and their own families. Education is the most important of those tools, and that includes safe, adequate schools. It is our hope that we can have a truly balanced budget on its way to the President's desk before the August recess. Then we need to turn our attention to other concerns, including juvenile drug abuse and crime, pension reform and, yes, campaign finance reform. Bipartisanship does not come easy to this Congress. But this budget outline proves it is not impossible. It is my hope that we will be able to work together to make sure this balanced budget framework is not the only bipartisan victory of this Congress, but merely the first. There is much more we need to do. Amendments Nos. 310, 338, 339, 349 Withdrawn

Mr. DASCHLE. If the majority leader will yield for just a moment, I know people are waiting for the vote on the judges, so we need to be expeditious. I, too, commend the distinguished Budget Committee chairman and the ranking member for the extraordinary demonstration of leadership. This vote would not have been possible were it not for the way they worked with the White House, with us, in coming to the vote we have today. This is a historic moment. We will balance the budget as a result of this resolution. Democrats and Republicans alike can take credit and can take a great deal of pride in what we have done today. So I commend them and appreciate very much their leadership today.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, at the end of this month one of the Senate's finest employees, Larry Harrison, will retire. He will be sorely missed. Larry has served his Nation for most of his life and worked in the Capitol for over 36 years--longer than most of my colleagues and I have been in Washington. He served in the U.S. Army during World War II, participating in the D-day invasion at Normandy, and following the war worked for the Architect of the Capitol for 5 years. Larry returned to the Capitol to work for the Sergeant at Arms in 1967, and has been with us ever since. Throughout his long years of service, his dedication to his work has been extraordinary. One of the great joys of working in the Capitol is the magnificent beauty of this building. For this, we owe a large debt to Larry. It is his job to maintain the President's Room, the Cloakroom, and the Senate Chamber, and the pride he takes in this work is well evident. Thanks to his careful attention to detail, these historic rooms are kept in pristine condition. In addition, he operates a shoe shine station in the Senators' bathroom. As my colleagues will attest, he never fails to have a kind word and a smile for everyone. Larry is known and loved by staff and Senators alike for his good humor. Indeed, his friendly nature has been contagious. An avid golfer, he is single-handedly responsible for the creation of the Cloakroom Invitational--an annual golf tournament involving the Cloakroom staff of both parties. More than just a day to relax on the golf course, it is an opportunity for staff from both sides of the aisle to get to know each other. It is safe to say that thanks to Larry Harrison, the Senate runs with a greater deal of friendship, respect and trust than would otherwise be the case. All this from a man whose first game of golf took place in a cornfield with a branch as a club and a crumpled ball of tape as a golf ball. I wish Larry all the best as he begins his retirement, and thank him for his years of service. As he leaves, our thoughts and prayers go with him. I hope he will enjoy the best of health, and have many years of happy retirement with his wife Jean and their three sons.

Mr. DASCHLE

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

Mr. DASCHLE

Mr. DASCHLE. Mr. President, today I am introducing legislation that reaffirms the intent of the U.S. Congress, originally expressed in 1916, to grant tax exempt status to telephone cooperatives. This exemption is now set forth in section 501(c)(12) of the Internal Revenue Code. I am joined by my distinguished colleagues, Senators Dorgan, Grassley, Johnson, and Conrad. This legislation is identical to a bill I introduced in the 103d and 104th Congresses and to a measure that was included in the Revenue Act of 1992, which ultimately was vetoed. Congress has always understood that a tax exemption is necessary to ensure that reliable, universal telephone service is available in rural America at a cost that is affordable to the rural consumer. Telephone cooperatives are nonprofit entities that provide this service where it might otherwise not exist due to the high cost of reaching remote, sparsely populated areas. The facilities of a telephone cooperative are used to provide both local and long distance communications services. Perhaps the most important of these for rural users is long distance. Without these services, both local and long distance, people in rural areas could not communicate with their own neighbors, much less with the world. While telephone cooperatives comprise only a small fraction of the U.S. telephone industry--about 1 percent--their services are vitally important to those who must rely upon them. Under Internal Revenue Code section 501(c)(12), a telephone cooperative qualifies for tax exemption only if at least 85 percent of its gross income consists of amounts collected from members for the sole purpose of meeting losses and expenses. Thus, the bulk of the revenues must be related to providing services needed by members of the cooperative, that is, rural consumers. No more than 15 percent of the cooperative's gross income may come from nonmember sources, such as property rentals or interest earned on funds on deposit in a bank. For purposes of the 85 percent test, certain categories of income are deemed neither member nor nonmember income and are excluded from the calculation. The reason for the 85 percent test is to ensure that cooperatives do not abuse their tax exempt status. A technical advice memorandum [TAM] released by the Internal Revenue Service a few years ago threatens to change the way telephone cooperatives characterize certain expenses for purposes of the 85 percent test. If the rationale set forth in the TAM is applied to all telephone cooperatives, the majority could lose their tax exempt status. Specifically, the IRS now appears to take the position that all fees received by telephone cooperatives from long distance companies for use of the local lines must be excluded from the 85 percent test and that fees received for billing and collection services performed by cooperatives on behalf of long distance companies constitute nonmember income to the cooperative. The legislation I am introducing today would clarify that access revenues paid by long distance companies to telephone cooperatives are to be counted as member revenues, so long as they are related to long distance calls paid for by members of the cooperative. In addition, the legislation would indicate that billing and collection fees are to be excluded entirely from the 85 percent test calculation. Mr. President, it is no secret that mere distance is the single most important obstacle to rural development. In the telecommunications industry today, we have the ability to bridge distances more effectively than ever before. Technology in this area has advanced at an incredible pace; however, maintaining and upgrading the rural telecommunications infrastructure is an exceedingly expensive proposition. We must do all we can to encourage this development, and ensuring that telephone cooperatives retain their legitimate tax exempt status is a vital step toward this goal. I believe that providing access to customers for long distance calls as well as billing and collecting for those calls on behalf of the cooperative's members and long distance companies are indisputably part of the exempt function of providing telephone service, especially to rural communities. The nature and function of telephone cooperatives have not materially changed since 1916, and neither should the formula upon which they rely to obtain tax exempt status. In the 104th Congress, the Joint Committee on Taxation estimated the cost of this legislation to be $61 million over a 6-year period. At the appropriate time, I will recommend appropriate offsets to cover the cost of this measure over the 10-year period required under the Budget Act. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. DASCHLE. Mr. President, since 1988, I have studied the effects on family farmers of a provision in estate tax law known as section 2032A. While section 2032A may seem a minor provision to some, it is critically important to family run farms. A problem with respect to the Internal Revenue Service's interpretation of this provision has been festering for a number of years and threatens to force the sale of many family farms. Section 2032A, which bases the estate tax applicable to a family farm on its use as a farm, rather than on its market value, reflects the intent of Congress to help families keep their farms. A family that has worked hard to maintain a farm should not have to sell it to a third party solely to pay stiff estate taxes resulting from increases in the value of the land. Under section 2032A, inheriting family members are required to continue farming the property for at least 15 years in order to avoid having the IRS recapture the tax savings. At the time section 2032A was enacted, it was common practice for one or more family members to cash lease the farm from the other members of the family. This practice made sense in a situation in which some family members were more involved than others in the day-to-day farming of the land. Typically, the other family members would continue to be at risk with respect to the value of the farm and participate in decisions affecting the farm's operation. Cash leasing among family members remained a common practice after the enactment of section 2032A. An inheriting child would continue to cash lease from his or her siblings, with no reason to suspect from the statute or otherwise that the cash leasing arrangement might jeopardize the farm's qualification for special use valuation. Based at least in part on some language that I am told was included in a Joint Committee on Taxation publication in early 1982, the Internal Revenue Service has taken the position that cash leasing among family members will disqualify the farm for special use valuation. The matter has since been the subject of numerous audits and some litigation, though potentially hundreds of family farmers may yet be unaware of the change of events. Cases continue to arise under this provision. In 1988, Congress provided partial clarification of this issue for surviving spouses who cash lease to their children. Due to revenue concerns, however, no clarification was made of the situation where surviving children cash lease among themselves. My concern is that many families in which inheriting children or other family members have cash leased to each other may not even be aware of the IRS's position on this issue. At some time in the future, they are going to be audited and find themselves liable for enormous amounts in taxes, interest and penalties. For those who cash leased in the late 1970's, this could be devastating because the taxes they owe are based on the inflated land values that existed at that time. A case that arose in my State of South Dakota illustrates the unfairness and devastating impact of the IRS interpretation of section 2032A. Janet Kretschmar, who lives with her husband, Craig, in Cresbard, SD, inherited her mother's farm along with her two sisters in 1980. Because the property would continue to be farmed by the family members, estate taxes were paid on it pursuant to section 2032A, saving over $50,000 in estate tax. Janet and Craig continued to farm the land and have primary responsibility for its day-to-day operation. They set up a simple and straightforward arrangement with the other two sisters whereby Janet and Craig would lease the sisters' interests from them. Seven years later, the IRS told the Kretschmars that the cash lease arrangement had disqualified the property for special use valuation and that they owed $54,000 to the IRS. According to the IRS, this amount represented estate tax that was being recaptured as a result of the disqualification. This came as an enormous surprise to the Kretschmars, as they had never been notified of the change in interpretation of the law and had no reason to believe that their arrangement would no longer be held valid by the IRS for purposes of qualifying for special use valuation. The fact is that, if they had known this, they would have organized their affairs in one of several other acceptable, though more complicated, ways. For many years, I have sought inclusion in tax legislation of a provision that would clarify that cash leasing among family members will not disqualify the property for special use valuation. In 1992, such a provision was successfully included in H.R. 11, the Revenue Act of 1992 and passed by Congress. Unfortunately, H.R. 11 was subsequently vetoed. In 1995, I introduced this provision as freestanding legislation; however, it did not reach the full Senate for a vote. Today, I am reintroducing a bill that is identical to the section 2032A measure which was passed in the Revenue Act of 1992. I am joined in this effort by Senators Dorgan, Conrad and Mr. Johnson whose expertise on tax and rural issues are well known. I must emphasize that there may be many other cases in other agricultural States where families are cash leasing the family farm among each other, unaware that the IRS could come knocking at their door at any minute. I urge my colleagues in the Senate who may have such cases in their State to work with us and support this important clarification of the law. I intend to request that the Joint Committee on Taxation estimate the revenue impact of this proposal. At an appropriate time thereafter, I will recommend any necessary offsets over a 10-year period as required by the Budget Act. Mr. President, I ask unanimous consent that the full text of the bill be printed in the Record.

Mr. DASCHLE. Mr. President, I am pleased to introduce legislation to expand the current inventory charitable donation rule to include Indian tribes. This proposal is short and simple. Under current law, companies may obtain a special charitable donation tax deduction under Internal Revenue Code section 170(e)(3) for contributing their excess inventory to the ill, the needy, or infants. While not limited to any particular type of company or inventory, this deduction commonly is used by food processing companies whose excess food inventories otherwise would spoil. Indian tribes have had difficulty obtaining these donations, however, because of an ambiguity in the law as to whether or not donating companies may deduct donations to organizations on Indian reservations. The current language in section 170(e)(3) requires charitable donations of excess inventory to be made to organizations that are described in section 501(c)(3) of the Code and exempt from taxation under section 501(a). While Indian tribes are exempt from taxation, they are not among the organizations described in section 501(c)(3). Accordingly, it is not clear that a direct donation of excess inventory to an Indian tribe would qualify for the charitable donation deduction under section 170(e)(3). Ironically, the Indian Tribal Government Tax Status Act found in section 7871 provides that an Indian tribal government shall be treated as a State for purposes of determining tax deductibility of charitable contributions made pursuant to section 170. Unfortunately, the act does not expressly extend to donations made under section 170(e)(3) because that provision technically does not include States as eligible donees. Mr. President, it is well documented that Native Americans, like other citizens, may meet the qualifications for this special charitable donation. No one would argue that it is not within the intent of section 170(e)(3) to allow contributions to Native American organizations to qualify for the special charitable donation deduction in that section of the code. The bill I am introducing today simply would allow those contributions to qualify for the deduction. By allowing companies to make qualified contributions to Indian tribes under section 170(e)(3), the bill would clearly further the intended purpose of both Internal Revenue Code section 170(e)(3) and the Indian Tribal Government Tax Status Act. The appropriateness of the measure is exhibited by the fact that it was included in the Revenue Act of 1992 (H.R. 11), which was vetoed for unrelated reasons. At that time, the measure was supported on policy grounds by the staffs of the joint committee on Taxation and Finance Committee. In 1995, the joint committee estimated that the proposal would have a negligible effect on Federal receipts over the 6-year period it estimated. I strongly encourage my colleagues to support this bill and ask unanimous consent that its text be printed in the Record.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, I am pleased to introduce legislation to expand the current inventory charitable donation rule to include Indian tribes. This proposal is short and simple. Under current law, companies may obtain a special charitable donation tax deduction under Internal Revenue Code section 170(e)(3) for contributing their excess inventory to the ill, the needy, or infants. While not limited to any particular type of company or inventory, this deduction commonly is used by food processing companies whose excess food inventories otherwise would spoil. Indian tribes have had difficulty obtaining these donations, however, because of an ambiguity in the law as to whether or not donating companies may deduct donations to organizations on Indian reservations. The current language in section 170(e)(3) requires charitable donations of excess inventory to be made to organizations that are described in section 501(c)(3) of the Code and exempt from taxation under section 501(a). While Indian tribes are exempt from taxation, they are not among the organizations described in section 501(c)(3). Accordingly, it is not clear that a direct donation of excess inventory to an Indian tribe would qualify for the charitable donation deduction under section 170(e)(3). Ironically, the Indian Tribal Government Tax Status Act found in section 7871 provides that an Indian tribal government shall be treated as a State for purposes of determining tax deductibility of charitable contributions made pursuant to section 170. Unfortunately, the act does not expressly extend to donations made under section 170(e)(3) because that provision technically does not include States as eligible donees. Mr. President, it is well documented that Native Americans, like other citizens, may meet the qualifications for this special charitable donation. No one would argue that it is not within the intent of section 170(e)(3) to allow contributions to Native American organizations to qualify for the special charitable donation deduction in that section of the code. The bill I am introducing today simply would allow those contributions to qualify for the deduction. By allowing companies to make qualified contributions to Indian tribes under section 170(e)(3), the bill would clearly further the intended purpose of both Internal Revenue Code section 170(e)(3) and the Indian Tribal Government Tax Status Act. The appropriateness of the measure is exhibited by the fact that it was included in the Revenue Act of 1992 (H.R. 11), which was vetoed for unrelated reasons. At that time, the measure was supported on policy grounds by the staffs of the joint committee on Taxation and Finance Committee. In 1995, the joint committee estimated that the proposal would have a negligible effect on Federal receipts over the 6-year period it estimated. I strongly encourage my colleagues to support this bill and ask unanimous consent that its text be printed in the Record.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, today I am introducing legislation that reaffirms the intent of the U.S. Congress, originally expressed in 1916, to grant tax exempt status to telephone cooperatives. This exemption is now set forth in section 501(c)(12) of the Internal Revenue Code. I am joined by my distinguished colleagues, Senators Dorgan, Grassley, Johnson, and Conrad. This legislation is identical to a bill I introduced in the 103d and 104th Congresses and to a measure that was included in the Revenue Act of 1992, which ultimately was vetoed. Congress has always understood that a tax exemption is necessary to ensure that reliable, universal telephone service is available in rural America at a cost that is affordable to the rural consumer. Telephone cooperatives are nonprofit entities that provide this service where it might otherwise not exist due to the high cost of reaching remote, sparsely populated areas. The facilities of a telephone cooperative are used to provide both local and long distance communications services. Perhaps the most important of these for rural users is long distance. Without these services, both local and long distance, people in rural areas could not communicate with their own neighbors, much less with the world. While telephone cooperatives comprise only a small fraction of the U.S. telephone industry--about 1 percent--their services are vitally important to those who must rely upon them. Under Internal Revenue Code section 501(c)(12), a telephone cooperative qualifies for tax exemption only if at least 85 percent of its gross income consists of amounts collected from members for the sole purpose of meeting losses and expenses. Thus, the bulk of the revenues must be related to providing services needed by members of the cooperative, that is, rural consumers. No more than 15 percent of the cooperative's gross income may come from nonmember sources, such as property rentals or interest earned on funds on deposit in a bank. For purposes of the 85 percent test, certain categories of income are deemed neither member nor nonmember income and are excluded from the calculation. The reason for the 85 percent test is to ensure that cooperatives do not abuse their tax exempt status. A technical advice memorandum [TAM] released by the Internal Revenue Service a few years ago threatens to change the way telephone cooperatives characterize certain expenses for purposes of the 85 percent test. If the rationale set forth in the TAM is applied to all telephone cooperatives, the majority could lose their tax exempt status. Specifically, the IRS now appears to take the position that all fees received by telephone cooperatives from long distance companies for use of the local lines must be excluded from the 85 percent test and that fees received for billing and collection services performed by cooperatives on behalf of long distance companies constitute nonmember income to the cooperative. The legislation I am introducing today would clarify that access revenues paid by long distance companies to telephone cooperatives are to be counted as member revenues, so long as they are related to long distance calls paid for by members of the cooperative. In addition, the legislation would indicate that billing and collection fees are to be excluded entirely from the 85 percent test calculation. Mr. President, it is no secret that mere distance is the single most important obstacle to rural development. In the telecommunications industry today, we have the ability to bridge distances more effectively than ever before. Technology in this area has advanced at an incredible pace; however, maintaining and upgrading the rural telecommunications infrastructure is an exceedingly expensive proposition. We must do all we can to encourage this development, and ensuring that telephone cooperatives retain their legitimate tax exempt status is a vital step toward this goal. I believe that providing access to customers for long distance calls as well as billing and collecting for those calls on behalf of the cooperative's members and long distance companies are indisputably part of the exempt function of providing telephone service, especially to rural communities. The nature and function of telephone cooperatives have not materially changed since 1916, and neither should the formula upon which they rely to obtain tax exempt status. In the 104th Congress, the Joint Committee on Taxation estimated the cost of this legislation to be $61 million over a 6-year period. At the appropriate time, I will recommend appropriate offsets to cover the cost of this measure over the 10-year period required under the Budget Act. Mr. President, I ask unanimous consent that the text of the bill be printed in the Record.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, since 1988, I have studied the effects on family farmers of a provision in estate tax law known as section 2032A. While section 2032A may seem a minor provision to some, it is critically important to family run farms. A problem with respect to the Internal Revenue Service's interpretation of this provision has been festering for a number of years and threatens to force the sale of many family farms. Section 2032A, which bases the estate tax applicable to a family farm on its use as a farm, rather than on its market value, reflects the intent of Congress to help families keep their farms. A family that has worked hard to maintain a farm should not have to sell it to a third party solely to pay stiff estate taxes resulting from increases in the value of the land. Under section 2032A, inheriting family members are required to continue farming the property for at least 15 years in order to avoid having the IRS recapture the tax savings. At the time section 2032A was enacted, it was common practice for one or more family members to cash lease the farm from the other members of the family. This practice made sense in a situation in which some family members were more involved than others in the day-to-day farming of the land. Typically, the other family members would continue to be at risk with respect to the value of the farm and participate in decisions affecting the farm's operation. Cash leasing among family members remained a common practice after the enactment of section 2032A. An inheriting child would continue to cash lease from his or her siblings, with no reason to suspect from the statute or otherwise that the cash leasing arrangement might jeopardize the farm's qualification for special use valuation. Based at least in part on some language that I am told was included in a Joint Committee on Taxation publication in early 1982, the Internal Revenue Service has taken the position that cash leasing among family members will disqualify the farm for special use valuation. The matter has since been the subject of numerous audits and some litigation, though potentially hundreds of family farmers may yet be unaware of the change of events. Cases continue to arise under this provision. In 1988, Congress provided partial clarification of this issue for surviving spouses who cash lease to their children. Due to revenue concerns, however, no clarification was made of the situation where surviving children cash lease among themselves. My concern is that many families in which inheriting children or other family members have cash leased to each other may not even be aware of the IRS's position on this issue. At some time in the future, they are going to be audited and find themselves liable for enormous amounts in taxes, interest and penalties. For those who cash leased in the late 1970's, this could be devastating because the taxes they owe are based on the inflated land values that existed at that time. A case that arose in my State of South Dakota illustrates the unfairness and devastating impact of the IRS interpretation of section 2032A. Janet Kretschmar, who lives with her husband, Craig, in Cresbard, SD, inherited her mother's farm along with her two sisters in 1980. Because the property would continue to be farmed by the family members, estate taxes were paid on it pursuant to section 2032A, saving over $50,000 in estate tax. Janet and Craig continued to farm the land and have primary responsibility for its day-to-day operation. They set up a simple and straightforward arrangement with the other two sisters whereby Janet and Craig would lease the sisters' interests from them. Seven years later, the IRS told the Kretschmars that the cash lease arrangement had disqualified the property for special use valuation and that they owed $54,000 to the IRS. According to the IRS, this amount represented estate tax that was being recaptured as a result of the disqualification. This came as an enormous surprise to the Kretschmars, as they had never been notified of the change in interpretation of the law and had no reason to believe that their arrangement would no longer be held valid by the IRS for purposes of qualifying for special use valuation. The fact is that, if they had known this, they would have organized their affairs in one of several other acceptable, though more complicated, ways. For many years, I have sought inclusion in tax legislation of a provision that would clarify that cash leasing among family members will not disqualify the property for special use valuation. In 1992, such a provision was successfully included in H.R. 11, the Revenue Act of 1992 and passed by Congress. Unfortunately, H.R. 11 was subsequently vetoed. In 1995, I introduced this provision as freestanding legislation; however, it did not reach the full Senate for a vote. Today, I am reintroducing a bill that is identical to the section 2032A measure which was passed in the Revenue Act of 1992. I am joined in this effort by Senators Dorgan, Conrad and Mr. Johnson whose expertise on tax and rural issues are well known. I must emphasize that there may be many other cases in other agricultural States where families are cash leasing the family farm among each other, unaware that the IRS could come knocking at their door at any minute. I urge my colleagues in the Senate who may have such cases in their State to work with us and support this important clarification of the law. I intend to request that the Joint Committee on Taxation estimate the revenue impact of this proposal. At an appropriate time thereafter, I will recommend any necessary offsets over a 10-year period as required by the Budget Act. Mr. President, I ask unanimous consent that the full text of the bill be printed in the Record.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, I rise to address the concerns that have been raised today on the floor. This is not the first time we have had differences of interpretation on this agreement, and it will not be the last. This has not been an easy process for anybody on either side of the aisle. I know that the majority leader and I have attempted to work through disagreements dispassionately, to keep our cool, and to recognize there are going to be honest differences of opinion on how we should proceed. I just hope we have learned some lessons from the way this budget agreement was handled, and Republicans and Democrats will make a commitment to not repeat this kind of process so we can avoid the pitfalls we are now experiencing. The fact is, when this agreement was negotiated, we had a handful of Senators in a room making decisions for the rest of us. While I agree with the end product, I have no qualms about disagreeing with the way we got there. Now we have to make decisions with regard to whether or not amendments are consistent with this budget agreement. The terms of the agreement call for the leaders to seek to produce support for the agreement by a majority of Democrats and Republicans and to pursue remedial action against provisions deemed to be inconsistent. The agreement says, in other words, that we are going to support this agreement and try to encourage a majority of our colleagues on both sides of the aisle to support it and to oppose amendments that are inconsistent with it. Yesterday, on a couple of occasions, I joined with the majority leader to oppose what I considered to be inconsistent amendments. I am told we have over 25 Democratic amendments. As I review those Democratic amendments, almost all of them, in my view, are inconsistent. But that issue is, obviously, going to be subject to debate and disagreement for as long as this resolution is on the floor. I believe that this amendment is consistent with the budget agreement for three reasons. First, it deals with an issue that is already addressed in the budget. Expanded health coverage for children is in this resolution. The budget negotiators acknowledged on policy grounds the value of extending child coverage and this budget includes funding to cover 5 million uninsured children. How is it inconsistent to say we are going to add additional children to the ranks of children to whom we have already committed in this budget agreement? Second, the Kennedy-Hatch amendment would alter the revenue numbers by raising a fee on tobacco, but it would not remove one single tax proposal agreed to by the negotiators and memorialized in the letter from the majority leadership. Those elements of the budget agreement are untouched: the higher education deduction; the HOPE scholarship credit; the capital gains tax reduction; estate tax reform; the $500-per-child tax credit--every one of those initiatives are still in the budget. This amendment doesn't affect any of those measures. It should be noted that the details of the tax provisions were kept intentionally vague, oftentimes at Republican insistence. They didn't want to specify the details of the proposals. As vague as those provisions are, they are not affected at all by this amendment. Third, the Kennedy-Hatch amendment does not worsen the deficit. In fact, it helps to reduce it. So, Mr. President, based on deficit reduction, based upon how this amendment affects the tax package, based upon the fact that this policy is already incorporated in the budget, I find it very difficult to understand how this amendment is inconsistent with the budget agreement. It happens to be entirely consistent with 1 of the 10 leadership bills that I proposed on the very first day of Congress. It happens to be a piece of legislation that the entire caucus feels very, very strongly about. I hope we can find a way to work through this disagreement, but I will tell you this: If it means bringing down the budget resolution, as some of our colleagues have threatened, then so be it--so be it. That isn't my first choice. I would like to find a way not to avoid these kinds of confrontations. I would like to find a way to resolve this dispute. But if it means dropping this agreement, then let's do it, let's go back to the drawing board, or let's figure out another way to do this. But I have to tell you, again, this debate highlights the point I have been trying to make about the problems with the process that produced this budget agreement. I hope we can find a way, in spite of our differences on this amendment, to keep the budget agreement intact and to resolve to find a better way to get these kind of agreements in the future. Whatever we do, let us remember how important this matter is, not just to Democrats, not just to some Republicans, but to a lot of children who are counting on this legislation passing sometime this Congress. I yield the floor. Mr. DOMENICI addressed the Chair.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, I wish to explain my vote today on H.R. 1122, the partial-birth abortion ban. As with many of my colleagues, this was not an easy decision. Virtually every Senator who has participated in the debate has noted his or her abhorrence to the procedure. I respect the views of Senators on either side of this issue. I have chosen to speak after the vote because this is a decision each Senator must decide for himself or herself. My own decision was not easy, in part, because this bill may have no practical effect on abortions in this country. It is likely that doctors wishing to perform later-term abortions will simply choose another option. As I repeated last week, this is not a ban of abortion; it is a ban of a specific procedure. It is not an easy decision because I favor a woman's right to consult the physician of her choice to decide the most appropriate course of action on matters directly affecting her health and her most personal circumstances. This decision was not easy because, in spite of the personal nature of this debate, its complexity, the medical repercussions, and its seriousness, this issue has become politicized to the extent that much of the rhetoric has substantially diminished the potential for real discourse on such an important matter. The result is that sincere efforts to find common ground have been labeled as ``shams,'' as ``political cover,'' and ``deceptive'' by many who passed judgment without having even read the legislation. Perhaps because my expectations were much too high, my greatest disappointment is reserved for some officials in the Catholic Church, especially in my State, for whom I had great respect and from whom I was given initial encouragement for my efforts. Their harsh rhetoric and vitriolic characterizations, usually more identified with the radical right than with thoughtful religious leadership, proved to be a consequential impediment to the decision which I have made today. It was most instructive. This was not an easy decision, because it is highly likely that H.R. 1122 will be declared unconstitutional should it be enacted into law. The Supreme Court has been very clear in regard to two issues concerning abortion. First, prior to the viability of a fetus, a woman's ability to choose to terminate her pregnancy is a fundamental constitutional right and cannot be abrogated. The Court has ruled that the Government cannot impose an undue burden on a woman who wishes to terminate her pregnancy with an abortion, prior to the viability of the fetus. Second, that after a fetus is determined to be viable, it can be given protection, so long as it does not endanger the life or health of the mother. On both principles, the bill just passed appears to be in conflict with numerous Supreme Court rulings. Yet in spite of the difficulty in coming to my decision, I voted in favor of its passage because I still desire to find common ground with those outside the extremes who truly hope to resolve the issue in a constructive and meaningful way. I will continue to insist that any common ground approach fall within the constitutional parameters which protect a woman and respect the legitimate concerns for her health. But I will consider other proposals which accommodate that need in a manner more effective than mine. My hope is that we can get beyond this debate to find a lasting, more acceptable legislative response. Recurring efforts to pass and veto a bill which is likely to be found to be unconstitutional only delays meaningful progress in an effort to ban not just one procedure but all of them once a fetus is viable. Failure to find common ground leaves little choice but to accelerate the legislative process to allow the earliest review of the law by the Supreme Court. Its determination of the questionable constitutionality of this approach will guide us and will certainly force those unwilling to compromise now to a more conciliatory position later. Our Nation must find the solution to this deeply vexing, moral problem which has persisted in dividing us. Let us not give up hope. I yield the floor. Mr. CRAIG addressed the Chair.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, perhaps as the amendment is being reworked, maybe I can comment very briefly. This is one of those very difficult circumstances that I am sure the majority leader and I are going to find ourselves in throughout this debate. I am very enthusiastic about the subject matter, about the issue, about the amendment. I would in any other set of circumstances be a cosponsor of it. I applaud the Senator for raising the issue. But because it falls outside the parameter of the agreement of this budget I am going to oppose this amendment under these circumstances. Again, I regret that I have to do that. But that is the agreement that we have enjoined, and I am going to try to adhere to that agreement throughout this debate. Mr. LOTT addressed the Chair.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, last week a fire devastated downtown Rapid City, consuming the historic Sweeney Building in a furious blaze that threatened to destroy the entire block. Only the heroic efforts of the Rapid City Fire Department and emergency workers from all over the county ensured that the damage, as severe as it was, was contained. This terrible blaze took a much-loved part of our heritage from us. The Sweeney Building had towered over Rapid City for 111 years, and was one of the oldest buildings in the Black Hills. Its builder, Tom Sweeney, was legendary. His name and slogan ``Tom Sweeney Wants to See You'' were famous throughout the hills, and his showmanship put Buffalo Bill to shame. His store was full of everything from gold pans to wagons for the early pioneers, and it was said that he could--and did-- sell anything. Tom's store is gone now, and it will be missed. Although part of our past, the Sweeney Building also was a vibrant part of our present. Seven businesses located in the building were lost in the Rapid City fire. They ranged from the State Barbershop, where Vern Johnson cut hair for 37 years, to the 1-week-old Blue Moon nightclub. No one is yet sure how the fire started, but shortly after firefighters arrived to investigate reports of smoke, a broken window fed the fire with a sudden rush of oxygen. The result was a fiery explosion that shattered storefront windows and blew out the rear wall of the building, causing a rain of bricks to fall on Larry and Mike Blote, two owners of the building, and Pat Dobbs, a reporter for the Rapid City Journal. Thankfully, they had just minor injuries. Soon after the explosion, Fire Chief Owen Hibbard made the difficult decision to retreat from the building. Few choices are more painful for firefighters. They are by nature people whose instincts urge them to save and preserve, and to fight a fire until the end. Yet as the flames of the Sweeney Building climbed higher and 40 mph winds blew cinders and sparks onto the roofs of neighboring buildings, Chief Hibbard recognized that the out-of-control blaze could destroy the entire block. Ordering his people back, he formed a defensive line around the fire and began the difficult work of containing it. Over the next 2 hours, with the sounds of exploding gunpowder and ammunition thundering from the burning First Stop Gun and Coin shop, the firefighters labored to cool nearby buildings and reduce the intensity of the blaze. By 4 p.m., the fire had been successfully contained, and dozens of homes and businesses that could have been destroyed were saved. Mr. President, I commend the Rapid City Fire Department for their outstanding job containing this fire. It is due to their preplanning, training, and strong leadership that no one sustained serious injuries, despite dangerous circumstances ranging from backdraft explosions to ricocheting bullets. I also want to thank Mayor Jim Shaw for his calm and solid leadership throughout this crisis. The loss of the Sweeney Building has been difficult, especially for those men and women who lost their livelihood, but I am confident that, together, we will recover. I yield the floor and I suggest the absence of a quorum.

Mr. DASCHLE

Mr. DASCHLE. Mr. President, let me respond quickly because many Senators are seeking recognition. I appreciate the tone of the Senator's response. I also acknowledge that the Senator from Pennsylvania is certainly well intentioned. I respect the fact that he is also trying to find a solution. I was perhaps sent the wrong message about his desire to become a constructive partner in the dialog when I read his criticisms of the effort several months ago. I take responsibility for perhaps misinterpreting his criticisms. But, nonetheless, I do believe he is well intentioned. It is ironic that we both come to the same conclusion. The Senator from Pennsylvania has offered legislation that will clearly not stop one abortion because every other abortion procedure is available. He recognizes that. So I don't know how anyone could argue that his ban of a procedure is a ban of abortion, because it doesn't stop all of the other procedures. So how does it stop abortion? As to Dr. Hern, that man is going to jail, and I will just tell him on the record in public right now, ``Dr. Hern, you're going to jail for perjury if this legislation passes and you lie about the need for unnecessary abortions you perform.'' If you don't go to jail, there is something wrong with our legal system, not with the law as it is written. As to viability, I have no differences of opinion with the Senator from Pennsylvania on viability. He and I agree on the need to find a way to ensure that the viable fetus is a top priority, along with a mother's health in these circumstances, and if it can be delivered live, it ought to be, regardless of what week. So we have no disagreement on that. With regard to making the determination, that it is up to the doctor, let me just say one last thing. I don't know what the Senator or any other Senator who supports H.R. 1122 would say if a doctor said, ``Well, I'm going to take Dr. Hern's approach `to save the life of a mother,' '' which is a clause in their bill, ``I'm going to use dilation and extraction to save the life of the mother. I can do that. It's legal.'' Dr. Hern should love that language. That is still available. So if we distrust the veracity of a doctor in my circumstances, I would think we would be reciprocal in distrusting the veracity of any doctor who could use any out and, indeed, they allow an out, not to mention all the other alternative abortion procedures. So there are differences between us in spite of the good intentions we have, in spite of the fact I know we both want to come to the same conclusion. Mr. President, I yield 15 minutes to the distinguished Senator from Maryland.

Mr. DASCHLE. Mr. President, does the Senator from Pennsylvania wish to consume any of the remaining time prior to the time of vote? Mr. SANTORUM addressed the Chair.

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

Mr. DASCHLE. Mr. President, we agree. We want to ban the procedure. But we also respect the Constitution. We recognize how critical it is that if we are indeed desirous of passing legislation that will remain constitutional, we have to live within the bounds of the Constitution. I respect greatly the distinguished Senator from Tennessee, and admire him immensely. He is a distinguished physician as well as a distinguished Senator. But the American College of Obstetricians and Gynecologists disagrees with his position. Mr. President, I ask unanimous consent to have printed in the Record a copy of the American College of Obstetricians and Gynecologists (ACOG) statement of policy, a letter of endorsement from ACOG, a report from the American Medical Associations Board of Trustees concerning late term abortion techniques, and examples of serious maternal health conditions as noted in obstetrics manuals. I would like to note that the recommendations of the American Medical Association regarding the use of late term abortion techniques are wholly consistent with the goals and intent of my amendment.