Frank Murkowski

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to announce for the information of the Senate and the public that a hearing has been scheduled before the full Committee on Energy and Natural Resources to consider the nomination of Patrick A. Shea to be Director of the Bureau of Land Management. The hearing will take place Thursday, July 17, 1997, at 9:30 a.m. in room SD-366 of the Dirksen Senate Office Building in Washington, DC. For further information, please call Camille Heninger Flint at (202) 224-5070.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, today I offer a very simple bill with the hope that it can receive expedited consideration in the Senate and be sent over to the House of Representatives for further consideration. Last year Congress authorized a program to explore the feasibility of integrating hydrogen fuel cells with systems to produce hydrogen from photovoltaic production or solid waste through gasification or steam reforming. This program is outlined in title II of Public Law 104-271, the Hydrogen Future Act of 1996. The program was originally authorized through 1997 and 1998, with funds to remain available until 1999. It has since become clear that the program will require a longer period of time to put into place. Accordingly, this bill simply extends the authorization through fiscal year 2001, with funds to remain available until September 30, 2002. For those who are unfamiliar with the promise of hydrogen energy systems, let me simply add that hydrogen is widely regarded as an important potential energy carrier with the potential to join electricity as a key component of a future sustainable energy system. Unlike coal, oil, or gas, hydrogen cannot be directly mined or produced--it must be extracted from hydrogen-rich materials such as natural gas, biomass, or even water. While there are significant technical and economic barriers that prevent the near-term, widespread use of hydrogen as an energy carrier, the eventual promise of hydrogen is compelling. Thus, Congress and the Department of Energy has placed a high priority on hydrogen energy research and development. I urge that my colleagues support the bill.

Mr. MURKOWSKI

Mr. MURKOWSKI. I yield 1 minute to the Senator from Utah.

Mr. MURKOWSKI. I yield 1 minute to the Senator from Idaho.

Mr. MURKOWSKI. Mr. President, I yield 2 minutes to the Senator from Nevada.

Mr. MURKOWSKI. I yield myself the balance of the time on our side. Mr. President, is there any question about whether this is a tax increase or not? Let's recognize what the Joint Tax Committee has said. They said it is a tax increase. It raises $686 million. If that isn't a tax increase, I don't know what is. What we have here, Mr. President, is not a new proposal, but a punitive proposal that was offered earlier this year and rejected by the Finance Committee, rejected by the House Ways and Means Committee, and it should be rejected by the full Senate. When you strip away all the rhetoric, this issue boils down to whether or not we are going to place a $700 million tax increase on the domestic mining industry. This proposal, as it stands, will speed up the departure of the mining industry from our shores. Let's look at this chart briefly. It shows what is happening with employment in the mining industry for metal, iron ore and copper. Let's look a little more closely at metal mining, which includes gold, silver, lead, and zinc from 1980 to 1995. In 1980 there were 98,000 jobs; by 1995 that had dropped to 51,000 jobs. In copper, it went from 30,000 jobs in 1980 to 15,000 in 1995. These numbers show what is happening to the mining industry in this country. What will happen if we place an additional $700 million in tax burden on them? They have to sell their gold, silver, copper, lead, and zinc at the world prevailing price, not the price in the United States. So where are the good-paying jobs going to go? They are going to go to Canada, Latin America, and Indonesia. We pride ourselves on cutting taxes and yet this amendment would throw a $700 million tax increase at the American mining industry. That is what the Bumpers amendment would do. It adds $700 million to the cost of producing minerals in the United States. Every Member of this body can figure out for themselves what effect this would have on the American mining industry. If you can't produce your product for a profit, for the price that is offered, you are out of business, that is what happens. Finally, Mr. President, let's make no mistake about it, this amendment is not about depletion on lands obtained under the Mining Act of 1872. The amendment is about the law itself. This is just an overt attempt to gain negotiating leverage on the industry. The U.S. mining industry agrees with Senator Bumpers, as do I, that this law is long overdue for overhaul. Let's sit down with the administration and reform the 1872 mining law, but let's not impose a punitive $700 million tax on the industry merely to gain negotiating leverage at the bargaining table. As a consequence, I urge my colleagues to oppose this punitive tax and vote against waiving the Budget Act. Mr. President, at the conclusion, I am going to raise a point of order that the amendment is not germane under section 305 (b)(2) of the Budget Act.

Mr. MURKOWSKI. I yield back our time.

Mr. MURKOWSKI. Mr. President, I raise a point of order that the amendment is not germane under section 305(b)(2) of the Budget Act.

Mr. MURKOWSKI. I am happy to yield to my friend from Nevada 3 minutes.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, today I rise to introduce legislation on behalf of Alaska Natives and residents of rural Alaska. This legislation makes technical changes to both the Alaska Native Claims Settlement Act [ANCSA] and the Alaska National Interest Lands Conservation Act [ANILCA]. Most of the provisions are similar to those contained in H.R. 2505 passed by the House last year. These changes are the direct result of more than three days of hearings consisting of 14 panels and more than 155 witnesses, the Senate Committee on Energy and Natural Resources held throughout Alaska during the last Congress. ANCSA Changes Mr. President, ANCSA is 25 years old. This legislation is a living, working document being used to improve the lives of Alaska's Native residents and the future generations of Alaska Natives. We have amended this document numerous times with technical changes in order to make it a more effective piece of legislation. The changes I am offering to ANCSA today would: 1. Allow Native Regional Corporations the option of retaining mineral estates of native allotments surrounded by ANCSA 12(a) and 12(b) selections. 2. Amend section 22(c) of ANCSA to include the Haida Corporation in the transfer of the administration of certain mining claims. 3. Codify an agreement reached between ANCSA Native corporations regarding revenue sharing on sales of rock, sand and gravel. 4. Direct the Secretary of Interior to determine the value of certain Calista Corporation lands and to complete the exchange authorized by Congress in 1991. 5. Authorize five southeast Alaska Native villages to organize as Native corporations. There are two provisions that I would like to single out here in my remarks today. Mr. President, section 5 of this legislation implements a land exchange with the Calista Corporation, an Alaska Native regional corporation organized under the authority of the Alaska Native Claims Settlement Act. This exchange, originally authorized in 1991, by Public Law 102-172, would provide for the United States to acquire approximately 225,000 acres of Calista and village corporation lands and interests in lands within the Yukon Delta National Wildlife Refuge in southwestern Alaska. The Refuge serves as important habitat and breeding and nesting grounds for a variety of fish and wildlife, including numerous species of migratory birds and waterfowl. As a result, the Calista exchange will enhance the conservation and protection of these vital habitats and thereby further the purpose of ANCSA and the Alaska National Interest Lands Conservation Act. In addition to conservation benefits, this exchange will also render much needed economic benefits to the Yupik Eskimo people of southwestern Alaska. The Calista region is burdened by some of the harshest economic and social conditions in the Nation. As a result of this exchange, the Calista Corporation will be better able to make the kind of investments that will improve the region's economy and the lives of the Yupik people. In this regard, this provision furthers and carries out the underlying purposes of ANCSA. This provision is, in part, the result of discussions by the various interested parties. As a result of those discussions, a number of modifications were made to the original package of lands offered for exchange. Chief among these were the addition of another 27,000 acres of surface estate (fee and conservation casements) of village corporation lands, as well as the Calista subsurface estate lying underneath those lands, and the removal of the Tuluksak mineralized parcel from the exchange. In a last minute agreement to move the bill through the House last year, the total value of the exchange package was reduced by 25% to $30 million. Such a reduction was unwarranted and seriously undermined the utility and benefit of the provision for the public and for Calista and the twelve village corporations involved. This legislation I introduce today restores the value to the Calista exchange portion of this bill. Mr. President, it is time to move forward with this exchange. Section 8 of this legislation provides long-overdue authorization to the Southeast Alaska Villages of Haines, Ketchikan, Petersburg, Tenakee, and Wrangell, Alaska that will permit them to establish Native Corporations under ANCSA. The history of these five villages clearly shows that the Alaska Natives who enrolled in them and their heirs have been inadvertently and wrongly denied the financial and cultural benefits of enrollment in a Village, Urban, or Group Corporation. This section simply amends ANCSA to provide authorization for each of the five Unrecognized Communities to form a Native Corporation pursuant to ANCSA, and directs the Secretary of the Interior, in consultation with the Secretary of Agriculture, to submit to Congress a report regarding lands and other compensation that should be provided to the Corporations formed pursuant to this section. This section specifically requires further Congressional action to provide compensation for these communities. ANILCA Changes This legislation also addresses changes that need to be made to ANILCA to ensure that the Federal agencies are fairly implementing this legislation consistent with its written provisions and promises. These changes will ensure that its implementation is consistent with the intent of Congress. These are simple changes that among other things: 1. Require all public land managers in Alaska or in a region containing Alaska to take a training course in ANILCA. 2. Authorize continuation of traditional subsistence activities in Glacier Bay subject to reasonable regulations by NPS. 3. Protect traditional and inholder access in and across ANILCA lands. 4. Protect property owners from having to relinquish ownership interests in cabins and possessions within them on ANILCA lands. Mr. President, seventeen years ago, Congress enacted the ANILCA. Despite the opposition of many Alaskans, over 100 million acres of land was set aside in a series of vast Parks, Wildlife Refuges, and Wilderness units. Much of the concern about the Act was the impact of these Federal units, and related management restrictions, on traditional activities and lifestyles. To allay these concerns, ANILCA included a series of unique provisions designed to ensure that traditional activities and lifestyles would continue, that Alaskans would not be subjected to a ``permit lifestyle'', and that the agencies would be required to recognize the crucial distinction between managing small units surrounded by millions of people in the lower 48 and vast multi-million acre units encompassing a relative handful of individuals and communities in Alaska. The sponsors of ANILCA issued repeated assurances that the establishment of these units would in fact protect traditional activities and lifestyles and not place them in jeopardy. Early implementation of the Act closely reflected these promises. However, as the years have passed, many of the Federal managers seem to have lost sight of these important representations to the people of Alaska. Agency personnel, trained primarily in lower 48 circumstances, have brought the mentality of restriction and regulation to Alaska. The critical distinctions between management of Parks, Refuges and Wilderness areas in the 49th State and the lower 48 have blurred. The result is the spread of restriction and regulation and the creation of the exact ``permit lifestyle'' which we were promised would never happen. I have become increasingly aware of this disturbing trend. In my conversations with Alaskans, I hear many complaints about ever increasing restraints on traditional activities and requirements for more and more paperwork and permits. A whole new ``industry'' has sprung up to help Alaskans navigate the bureaucratic shoals that have built up during the past few years. Let me cite a few of the incidents that have come to my attention. The U.S. Fish and Wildlife Service decides it wants to establish a ``wilderness management'' regime and eliminate motorboat use on a river. It proceeds with the plan until protests cause the Regional Solicitor to advise the Service that its plan violates Section 1110(a) of ANILCA. Owners of cabins built, occupied, and used long before ANILCA are told they must give up their interests in the cabins although Section 1303 expressly enables cabin owners to retain their possessory interests in their cabins. Visitor services contracts are awarded and then revoked because the agencies failed to adhere to the requirements of Section 1307. Small landowners of inholdings seek to secure access to their property and are informed that they must file for a right-of-way as a transportation and utility system and pay the U.S. hundreds of thousands of dollars to prepare a totally unnecessary environmental impact statement. An outfitter spends substantial time and money responding to a request for proposals, submits an apparently winning proposal, and has the agency arbitrarily change its mind and decide to withdraw its request--it does not offer to compensate the outfitter for his efforts. Mr. President, the legislation I introduce today will ensure that agencies are fairly implementing ANILCA consistent with its written provisions and promises. These technical corrections to ANILCA will ensure that its implementation is consistent with the intent of Congress. Mr. President, conditions have changed in the 17 years since the passage of ANILCA and we have all had a great deal of experience with the Act's implementation. It is time to make the law clearer and to make the federal manager's job easier. Mr. President, I ask unanimous consent that a table be printed in the Record.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I rise in strong support of the tax cut bull that forms the heart of the second reconciliation bill. I want to take this opportunity to commend the chairman of the Finance Committee, Senator Roth and the ranking member, Senator Moynihan, for their efforts in ensuring that the Finance Committee's bill was reported with strong bipartisan support. I hope the spirit of bipartisanship that permeated the committee's work will extend to our debate on the Senate floor. Mr. President, during this past week, we considered the first budget reconciliation bill which was designed to slow the growth of Federal spending and to stop the hemorrhaging of the Medicare Program. And we successfully achieved both goals while at the same time making a commitment to boost funding by $16 billion to enable more children in America to obtain health insurance. The tax bill we are considering today builds on that achievement by earmarking $8 billion from increased tobacco taxes for expanded children's health insurance. With this unprecedented $24 billion commitment of funds for children's health insurance, I believe the Senate has made an investment in the health of the children of America that should alleviate the anxieties and fears of millions of parents about paying for the health care of their children. What is even more remarkable about the reconciliation bills we are considering this week is that at the end of the process, we will have set this Government on course to finally achieve a balanced budget. While I believe the tax cuts contained in this bill provide much needed financial relief for the vast majority of working Americans, I believe our greatest achievement is balancing the budget. What that means is that when this agreement is fully implemented in 5 years, the Federal Government will no longer have to borrow to keep this Government operating. Most importantly, the balanced budget will give us the opportunity to finally begin paying down our enormous $5- plus trillion national debt. Mr. President, on Monday, the world's financial markets were reminded of the enormity of the American Government's debt and the impact that debt has on the global marketplace. When Japanese Prime Minister Hashimoto suggested that he was tempted to sell off portions of Japan's American debt portfolio to stabilize the yen/dollar exchange rate, markets plummeted throughout the world. On Wall Street, we saw the Dow Jones average drop 192 points, the second largest point decline in exchange history. Although markets recovered after Japan's Finance Minister dismissed the idea that Japan would dump it's Treasury securities, the lesson is unmistakable. The security of our economy can never be assured so long as this country continues to run deficits and pile up billions in additional debt. As long as we must turn to world markets to finance Government spending, our economy's health is always in danger of being held hostage to the political whims of foreign governments and speculators. That is why it is so important that we balance the budget and begin to pay down the debt. And that is why these reconciliations bills are vital to our Nation's economic security. Mr. President, the tax bill before us provides much-needed relief for the hard-working middle-income families who have not seen their tax burden reduced in 16 years. Despite what some of my colleagues on the other side of the aisle may allege about this tax bill, the lion's share of the income tax cuts--81 percent--will go to families earning between $12,000 and $62,000. This bipartisan bill will reduce the taxes paid by every low- and middle-income family with a child by $500. For a family with three children under 13, their tax burden will be reduced by $1,500. That's $1,500 that the family will have available to pay off bills, buy clothing for their children or spend as they see fit. A provision in the bill requires families with children between the ages of 13 and 17 to invest their $500 children's tax credit in an educational savings account. While I think it is important that we do as much as we can to encourage families to save for college, I think it is inappropriate for us to require families to establish these accounts. I will support an amendment that will debate this provision from the bill. The bill also provides more than $30 million in tax relief for families that are facing enormous college education bills. And it encourages economic growth and savings by reducing the capital gains tax and expanding individual retirement accounts. I also applaud the changes the committee made to the estate tax, with the goal that family businesses should be kept together rather than split apart in order to pay estate taxes. In fact, Mr. President, it is my hope that we can fundamentally change, if not eliminate, the estate tax with what can only be called confiscatory tax rates. Although we have not been able to achieve that result in this bill, I think that should be one of our goals when we consider fundamental tax reform in the future. Mr. President, the items I have just noted represent the highlights of the bill. What is again worth mentioning is how we were able to craft this bill. We did it with input and good debate between Republicans and Democrats on the committee. There was no rancor. We were not partisan, we tried to work within the confines of the budget agreement negotiated by our leadership with the White House. I would hope that that spirit of bipartisanship will continue as we debate this bill since I think we can all agree that the goal of providing tax relief for hard-working Americans and encouraging savings and investment are in the best long-term interests of our Nation. Amendment No. 518

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, I would like to announce for the public that two joint oversight hearings have been scheduled before the Committee on Energy and Natural Resources and the House Resources Committee. The hearings will take place Wednesday, July 9, 1997 at 11 a.m. and Thursday, July 10, 1997 at 9:30 a.m. in room SD-366 of the Dirksen Senate Office Building in Washington, D.C. The purpose of the hearings is to receive testimony on the Final Draft of the Tongass Land Management Plan as the first step in the congressional review process provided by the 1996 amendments to the Regulatory Flexibility Act. Those who wish to submit written statements should write to the Committee on Energy and Natural Resources, U.S. Senate, Washington, D.C. 20510. For further information, please call Judy Brown or Mark Rey at (202) 224-6170.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, today I rise to introduce legislation designed to end an impasse that we've endured for far too long--the stalemate over the Ward Valley low-level radioactive waste facility and efforts to implement an important Federal law--the low level radioactive waste policy amendments. I am doing this today because of documents that have recently come to light under the Freedom of Information Act and due to the continuing differences between the words spoken under oath by a Presidential nominee before my committee and his actions to date. For more than 10 years, the State of California acting in complete accordance with Federal law and in cooperation with responsible Federal agencies, has been attempting to open a low-level radioactive waste repository at a Mojave Desert site in Ward Valley. The long, tortured process costing more that $40 million has included a statewide search resulting in the selection of a virtually unpopulated desert valley; two environmental impact statements under the National Environmental Policy Act; two biological opinions under the Endangered Species Act; and judicial review including the California Supreme Court. From the outset, the State has been dogged by the lawsuits and protests of a small fringe group of activists. But in the end, California has met every test. Ward Valley was found to be safe, and the State issued a license containing more than 130 carefully developed safety and environmental stipulations. Consistent with its own independent evaluations, the Department of the Interior agreed to sell the land to California for the Ward Valley site in January 1993. But shortly thereafter, the Department of the Interior abruptly reversed itself, demanding a series of discretionary studies and reviews that, 4 years later, still have no end in sight. Specifically, the Department of the Interior asked the National Academy of Sciences to review seven technical issues related to the site. In May 1995, the Academy's report was released. The report was highly favorable to the site selection and each of the seven issues. As a consequence, Interior Secretary Babbitt indicated that he intended to transfer the site. Two more months passed. On July 27, 1995, the President's nominee to be the Deputy Secretary of the Interior, Mr. John Garamendi, appeared before the Energy and Natural Resources Committee and testified under oath, that the Ward Valley issue ``will be satisfactorily culminated shortly * * * and I believe it should be.'' With that testimony in mind, I recently reviewed documents made available under the Freedom of Information Act. With the benefit of those documents and other evidence of the systematic delay fostered by the Department of the Interior to block Ward Valley, I have reached the sad conclusion that Congress must intervene to end this stalemate. Before I go into the disturbing history of this issue and the content of the documents uncovered by the Freedom of Information Act request, some background is important. There is a tremendous difference between low level radioactive waste and the spent fuel issue the Senate has been debating over the past 2 weeks. Spent fuel, of course, is the high level waste from nuclear power reactors. Low level radioactive waste, on the other hand, is composed of items such as medical gowns, biomedical wastes, filters, resins and similar wastes generated from cancer treatment, biomedical research, and other activities. Low level radioactive waste is generated during cutting-edge research that may help us find a cure for AIDS. Low level radioactive waste is generated from the development of new drugs and cancer therapies. Low level radioactive waste is generated by the high tech and biotech industry in the quest for new products and services that will be at the foundation of our 21st century economy. While it also includes waste from nuclear power production, Congress wisely placed specific limits on the levels which are a State responsibility. When the Senate was debating the fate of high-level spent fuel, we clearly had a situation where the State of Nevada opposed a repository. The Governor of Nevada opposed it. But the low level waste issue is vastly different. Governor Wilson of California supports Ward Valley. The State of California has been working on plans open a low level waste repository in California for the past decade. They have done so in complete accordance with Federal law, which assigns responsibility for disposal of a specified portion of low level radioactive waste to the States. Governor Wilson understands that thousands of jobs in California, particularly among the high-tech and biotech industries, absolutely depend on having dependable access to a safe, secure facility for low level radioactive waste. Governor Wilson understands that countless lives might be saved through the cancer breakthrough or AIDS cure that the use of radioactive materials might bring. Governor Wilson also understands that low level radioactive waste is currently being stored at hundreds of urban locations all across California. It's being stored in basements and in parking lot trailers. It's being stored in warehouses and temporary shelters. It's on college campuses, in residential neighborhoods, and in hospitals. And as long as the waste is in these temporary locations in populated areas, it is subject to accidental radioactive releases from fire, earthquakes, and floods. Governor Wilson is understandably concerned about the health and safety of Californians. He is frustrated by the delays California has faced in trying to get this facility open. So am I. I am frustrated by the fact that the President's nominee to be the Deputy Secretary of the Interior, Mr. John Garamendi, appeared before the Energy and Natural Resources Committee on July 27, 1995 and testified under oath, that the Ward Valley issue should and would be quickly resolved. After that testimony, seven months passed. Nothing happened. On February 15, 1996, Deputy Secretary Garamendi indicated that ``new information'' related to a different low-level radioactive waste site at Beatty, Nevada, required further testing at the Ward Valley site and the preparation of yet another Supplemental Environmental Impact Statement (SEIS). Literally one day before his announcement, the Director of the U.S. Geological Survey said that linkages between the Beatty site and Ward Valley were ``too tenuous to have much scientific value.'' But the Deputy Secretary ignored the Director's scientific advice. In a public news conference, Deputy Secretary Garimendi indicated that the additional testing would take about four months, and that the preparation of a Supplemental Environmental Impact Statement (SEIS) would take about a year. On August 5, 1996, months after we expected the testing to be complete, an official of the lab Interior selected to perform the testing said, ``Interior Department officials have yet to submit a work plan . . . on the testing they want done.'' During this same time frame, Interior Department officials were distributing documents to the public containing factually incorrect information taken verbatim from Ward Valley opponents, even though accurate information was readily available from the Department of Energy. It now appears that Interior made no effort to check the facts with DOE with respect to the veracity of the information it was providing to the public. Recently, the Governor of California made me aware of documents he obtained through Freedom of Information Act (FOIA) requests. These documents reveal the following: Despite the understandable lack of radiological expertise resident in the Department of the Interior, the Department has made no effort to communicate with the federal agency with primary expertise and jurisdiction in the matter--the Nuclear Regulatory Commission. The professional, non-political, radiological experts of the Department of Energy have indicated that: ``Interior's concern that the [Ward Valley] facility lacks an environmental monitoring system has no basis in fact;'' the Department of the Interior is attempting to subvert the National Academy of Sciences recommendations with respect to the timing of the tests and nature of the tests to be performed; the Department of the Interior has understated the costs and the time required for the conduct of the tests; and the tests the Department of the Interior has outlined will result in additional litigation regardless of their outcome. Mr. President, these documents are plain on their face. But they are particularly troubling since they show the vast difference between the words spoken by Mr. Garamendi in his confirmation hearing, and the actions he has taken since his confirmation. Let's again review the facts: Deputy Secretary Garamendi testified under oath that the Ward Valley issue would be, and should be, quickly resolved. He then called for additional testing that did not conform to the recommendations of the National Academy of Sciences, creating a false linkage in the public's mind between the Beatty site and the Ward Valley site, despite the fact that his own USGS Director said that such a linkage could not be justified by the science. Deputy Secretary Garamendi spread misinformation about the composition of the radioactive waste stream in Department press materials supplied by project opponents, making no effort to check their veracity with the Department of Energy, the Nuclear Regulatory Commission, or any other agency with expertise in such matters. Deputy Secretary Garamendi persistently failed to get the testing underway, which he later blamed on the threats of a lawsuit that were not, in fact, made until long after the time he said the tests would be complete. Indeed, the Department of the Interior has designed a process specifically intended to foster further delay. Mr. President, over the past month or so there has been a new twist that is frankly the straw that breaks the camel's back. The State of California, in its continuing efforts to achieve a compromise, has agreed to perform additional testing pursuant to the National Academy of Sciences guidelines prior to the federal land transfer. Let me make this clear: California has always agreed to do the additional testing . . . the issue of dispute is that Interior insisted the testing be done prior to the land transfer, while California and the National Academy of Sciences said the testing would be best accomplished after the land transfer. So California has now agreed to perform additional testing prior to the land transfer. They have clearly made efforts to compromise. I received a letter from Deputy Secretary Garamendi, dated February 27, 1997, which exclaimed that the delays at Ward Valley have gone on long enough, and that welcomed the decision by the State of California to undertake additional testing. When I saw that letter. I thought to myself: Finally, this issue will be resolved. I was shocked by what happened next: The BLM produced an administrative determination, allegedly two years old that nobody had ever seen, that will not permit California to undertake the testing that Interior insists must be undertaken prior to the land transfer! They have California in a ``Catch-22.'' BLM informed the California Department of Health Services that they could not proceed with the testing without a new permit from the BLM and yet another biological consultation with the U.S. Fish and Wildlife Service with respect to the Desert Tortoise. The BLM based this requirement for a new permit on an ``administrative determination,'' allegedly issued two years ago, which limits surface disturbance associated with pre-construction testing. But further examination revealed several points about this document: This old administrative determination was unknown to the California Department of Health Services, U.S. Ecology, and even the local BLM District Office until weeks ago. The local BLM office is unable to provide any evidence that this ``administrative determination'' was provided to any of the parties whose actions it supposedly limits. The administrative determination is absurd on its face. The U.S. Fish and Wildlife Service has determined that the 90 acres of surface disturbance associated with the construction and operation of the Ward Valley facility will not jeopardize the desert tortoise or its habitat. Moreover, under current BLM guidelines, ten acre mining operations on other BLM land would not trigger the need for a biological consultation if certain desert tortoise protection measures were incorporated into the plan submitted to BLM. Indeed, five acre mining operations would not even require the applicant to submit a tortoise protection plan for approval. Yet, it is BLM's sudden contention that less than 5 acres of surface disturbance associated with testing will require yet another full biological consultation by the U.S. Fish and Wildlife Service. Clearly, Mr. President, this latest obstruction, and the reasons cited for it, make no sense in the context of the various other permits and administrative determinations that have been previously granted at the site. The fact that this administrative decision suddenly surfaced in the midst of state planning to undertake the new tests is highly unusual-- perhaps even worthy of investigation by the Inspector General. Mr. President, earlier this year I asked the General Accounting Office to investigate this matter. That investigation is now underway. At this very moment, GAO auditors are reviewing documents in the District BLM office in California and at Department of Interior headquarters here in Washington. The GAO report will not be complete until July 15, but let me simply say that their preliminary findings appear to agree with my understanding of the facts. What we are seeing at the Department of the Interior is a blatant display of bad faith and obstructionism with regard to California's efforts to implement Federal law through development of the Ward Valley site. I am particularly distressed by this, particularly in light of the words spoken by Mr. Garamendi at his confirmation hearing. Mr. President, the legislation I am introducing today would convey the BLM land at Ward Valley to California as soon as a check for the fair market value of the land plus $100 is tendered to the Secretary of the Treasury, after the State of California formally tenders a promise to conduct the additional testing as outlined by the National Academy of Sciences. It's a simple bill. California agrees to do the testing outlined by the National Academy of Sciences, California gets its site, and the taxpayer gets fair market value for the land. I am willing to consider alternative approaches, but my bottom line is a quick and satisfactory resolution to this issue by qualified experts rather than political activists. I am willing to entertain negotiated compromises. I am willing to entertain alternative legislative approaches. I am not willing to entertain further delay. In closing, Mr. President, let me share a story that I find particularly rich in irony: Interior Secretary Babbitt, while the Governor of Arizona, was deeply concerned about the difficulty of the Federal Government to provide for adequate low-level radioactive waste disposal sites. He was asked by the National Governors' Association to chair a task force to look into the problem. The Babbitt task force recommended that the responsibility for low- level radioactive waste management be given to the States. In 1981, Governor Babbitt wrote that ``the siting of a low level nuclear waste facility involves primarily state and local issues that are best resolved at the government level closest to those affected.'' There was another Governor at the time who was active in the National Governor's Association and supported this approach: The Governor of Arkansas. His name was Bill Clinton. Congress listened to these Governors, and passed the Low Level Radioactive Waste Policy Act which gave the States the responsibility for low level radioactive waste management. California is the first State to license a facility under the Low Level Radioactive Waste Policy Act. And who are the Federal authorities who are today frustrating California's attempt to follow the law and open its site? None other than Mr. Babbitt and his Deputy at the Department of the Interior, himself a former California state official. What an irony that former State officials would declare a State unworthy of trust in carrying out its congressionally assigned duties and responsibilities. What a difference a few years in Washington can make.

Mr. MURKOWSKI. Mr. President, today I offer a very simple bill with the hope that it can receive expedited consideration in the Senate and be sent over to the House of Representatives for further consideration. Last year Congress authorized a program to explore the feasibility of integrating hydrogen fuel cells with systems to produce hydrogen from photovoltaic production or solid waste through gasification or steam reforming. This program is outlined in title II of Public Law 104-271, the Hydrogen Future Act of 1996. The program was originally authorized through 1997 and 1998, with funds to remain available until 1999. It has since become clear that the program will require a longer period of time to put into place. Accordingly, this bill simply extends the authorization through fiscal year 2001, with funds to remain available until September 30, 2002. For those who are unfamiliar with the promise of hydrogen energy systems, let me simply add that hydrogen is widely regarded as an important potential energy carrier with the potential to join electricity as a key component of a future sustainable energy system. Unlike coal, oil, or gas, hydrogen cannot be directly mined or produced--it must be extracted from hydrogen-rich materials such as natural gas, biomass, or even water. While there are significant technical and economic barriers that prevent the near-term, widespread use of hydrogen as an energy carrier, the eventual promise of hydrogen is compelling. Thus, Congress and the Department of Energy has placed a high priority on hydrogen energy research and development. I urge that my colleagues support the bill.

Mr. MURKOWSKI. Mr. President, today I rise to introduce legislation on behalf of Alaska Natives and residents of rural Alaska. This legislation makes technical changes to both the Alaska Native Claims Settlement Act [ANCSA] and the Alaska National Interest Lands Conservation Act [ANILCA]. Most of the provisions are similar to those contained in H.R. 2505 passed by the House last year. These changes are the direct result of more than three days of hearings consisting of 14 panels and more than 155 witnesses, the Senate Committee on Energy and Natural Resources held throughout Alaska during the last Congress. ANCSA Changes Mr. President, ANCSA is 25 years old. This legislation is a living, working document being used to improve the lives of Alaska's Native residents and the future generations of Alaska Natives. We have amended this document numerous times with technical changes in order to make it a more effective piece of legislation. The changes I am offering to ANCSA today would: 1. Allow Native Regional Corporations the option of retaining mineral estates of native allotments surrounded by ANCSA 12(a) and 12(b) selections. 2. Amend section 22(c) of ANCSA to include the Haida Corporation in the transfer of the administration of certain mining claims. 3. Codify an agreement reached between ANCSA Native corporations regarding revenue sharing on sales of rock, sand and gravel. 4. Direct the Secretary of Interior to determine the value of certain Calista Corporation lands and to complete the exchange authorized by Congress in 1991. 5. Authorize five southeast Alaska Native villages to organize as Native corporations. There are two provisions that I would like to single out here in my remarks today. Mr. President, section 5 of this legislation implements a land exchange with the Calista Corporation, an Alaska Native regional corporation organized under the authority of the Alaska Native Claims Settlement Act. This exchange, originally authorized in 1991, by Public Law 102-172, would provide for the United States to acquire approximately 225,000 acres of Calista and village corporation lands and interests in lands within the Yukon Delta National Wildlife Refuge in southwestern Alaska. The Refuge serves as important habitat and breeding and nesting grounds for a variety of fish and wildlife, including numerous species of migratory birds and waterfowl. As a result, the Calista exchange will enhance the conservation and protection of these vital habitats and thereby further the purpose of ANCSA and the Alaska National Interest Lands Conservation Act. In addition to conservation benefits, this exchange will also render much needed economic benefits to the Yupik Eskimo people of southwestern Alaska. The Calista region is burdened by some of the harshest economic and social conditions in the Nation. As a result of this exchange, the Calista Corporation will be better able to make the kind of investments that will improve the region's economy and the lives of the Yupik people. In this regard, this provision furthers and carries out the underlying purposes of ANCSA. This provision is, in part, the result of discussions by the various interested parties. As a result of those discussions, a number of modifications were made to the original package of lands offered for exchange. Chief among these were the addition of another 27,000 acres of surface estate (fee and conservation casements) of village corporation lands, as well as the Calista subsurface estate lying underneath those lands, and the removal of the Tuluksak mineralized parcel from the exchange. In a last minute agreement to move the bill through the House last year, the total value of the exchange package was reduced by 25% to $30 million. Such a reduction was unwarranted and seriously undermined the utility and benefit of the provision for the public and for Calista and the twelve village corporations involved. This legislation I introduce today restores the value to the Calista exchange portion of this bill. Mr. President, it is time to move forward with this exchange. Section 8 of this legislation provides long-overdue authorization to the Southeast Alaska Villages of Haines, Ketchikan, Petersburg, Tenakee, and Wrangell, Alaska that will permit them to establish Native Corporations under ANCSA. The history of these five villages clearly shows that the Alaska Natives who enrolled in them and their heirs have been inadvertently and wrongly denied the financial and cultural benefits of enrollment in a Village, Urban, or Group Corporation. This section simply amends ANCSA to provide authorization for each of the five Unrecognized Communities to form a Native Corporation pursuant to ANCSA, and directs the Secretary of the Interior, in consultation with the Secretary of Agriculture, to submit to Congress a report regarding lands and other compensation that should be provided to the Corporations formed pursuant to this section. This section specifically requires further Congressional action to provide compensation for these communities. ANILCA Changes This legislation also addresses changes that need to be made to ANILCA to ensure that the Federal agencies are fairly implementing this legislation consistent with its written provisions and promises. These changes will ensure that its implementation is consistent with the intent of Congress. These are simple changes that among other things: 1. Require all public land managers in Alaska or in a region containing Alaska to take a training course in ANILCA. 2. Authorize continuation of traditional subsistence activities in Glacier Bay subject to reasonable regulations by NPS. 3. Protect traditional and inholder access in and across ANILCA lands. 4. Protect property owners from having to relinquish ownership interests in cabins and possessions within them on ANILCA lands. Mr. President, seventeen years ago, Congress enacted the ANILCA. Despite the opposition of many Alaskans, over 100 million acres of land was set aside in a series of vast Parks, Wildlife Refuges, and Wilderness units. Much of the concern about the Act was the impact of these Federal units, and related management restrictions, on traditional activities and lifestyles. To allay these concerns, ANILCA included a series of unique provisions designed to ensure that traditional activities and lifestyles would continue, that Alaskans would not be subjected to a ``permit lifestyle'', and that the agencies would be required to recognize the crucial distinction between managing small units surrounded by millions of people in the lower 48 and vast multi-million acre units encompassing a relative handful of individuals and communities in Alaska. The sponsors of ANILCA issued repeated assurances that the establishment of these units would in fact protect traditional activities and lifestyles and not place them in jeopardy. Early implementation of the Act closely reflected these promises. However, as the years have passed, many of the Federal managers seem to have lost sight of these important representations to the people of Alaska. Agency personnel, trained primarily in lower 48 circumstances, have brought the mentality of restriction and regulation to Alaska. The critical distinctions between management of Parks, Refuges and Wilderness areas in the 49th State and the lower 48 have blurred. The result is the spread of restriction and regulation and the creation of the exact ``permit lifestyle'' which we were promised would never happen. I have become increasingly aware of this disturbing trend. In my conversations with Alaskans, I hear many complaints about ever increasing restraints on traditional activities and requirements for more and more paperwork and permits. A whole new ``industry'' has sprung up to help Alaskans navigate the bureaucratic shoals that have built up during the past few years. Let me cite a few of the incidents that have come to my attention. The U.S. Fish and Wildlife Service decides it wants to establish a ``wilderness management'' regime and eliminate motorboat use on a river. It proceeds with the plan until protests cause the Regional Solicitor to advise the Service that its plan violates Section 1110(a) of ANILCA. Owners of cabins built, occupied, and used long before ANILCA are told they must give up their interests in the cabins although Section 1303 expressly enables cabin owners to retain their possessory interests in their cabins. Visitor services contracts are awarded and then revoked because the agencies failed to adhere to the requirements of Section 1307. Small landowners of inholdings seek to secure access to their property and are informed that they must file for a right-of-way as a transportation and utility system and pay the U.S. hundreds of thousands of dollars to prepare a totally unnecessary environmental impact statement. An outfitter spends substantial time and money responding to a request for proposals, submits an apparently winning proposal, and has the agency arbitrarily change its mind and decide to withdraw its request--it does not offer to compensate the outfitter for his efforts. Mr. President, the legislation I introduce today will ensure that agencies are fairly implementing ANILCA consistent with its written provisions and promises. These technical corrections to ANILCA will ensure that its implementation is consistent with the intent of Congress. Mr. President, conditions have changed in the 17 years since the passage of ANILCA and we have all had a great deal of experience with the Act's implementation. It is time to make the law clearer and to make the federal manager's job easier. Mr. President, I ask unanimous consent that a table be printed in the Record.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, today I rise to introduce legislation designed to end an impasse that we've endured for far too long--the stalemate over the Ward Valley low-level radioactive waste facility and efforts to implement an important Federal law--the low level radioactive waste policy amendments. I am doing this today because of documents that have recently come to light under the Freedom of Information Act and due to the continuing differences between the words spoken under oath by a Presidential nominee before my committee and his actions to date. For more than 10 years, the State of California acting in complete accordance with Federal law and in cooperation with responsible Federal agencies, has been attempting to open a low-level radioactive waste repository at a Mojave Desert site in Ward Valley. The long, tortured process costing more that $40 million has included a statewide search resulting in the selection of a virtually unpopulated desert valley; two environmental impact statements under the National Environmental Policy Act; two biological opinions under the Endangered Species Act; and judicial review including the California Supreme Court. From the outset, the State has been dogged by the lawsuits and protests of a small fringe group of activists. But in the end, California has met every test. Ward Valley was found to be safe, and the State issued a license containing more than 130 carefully developed safety and environmental stipulations. Consistent with its own independent evaluations, the Department of the Interior agreed to sell the land to California for the Ward Valley site in January 1993. But shortly thereafter, the Department of the Interior abruptly reversed itself, demanding a series of discretionary studies and reviews that, 4 years later, still have no end in sight. Specifically, the Department of the Interior asked the National Academy of Sciences to review seven technical issues related to the site. In May 1995, the Academy's report was released. The report was highly favorable to the site selection and each of the seven issues. As a consequence, Interior Secretary Babbitt indicated that he intended to transfer the site. Two more months passed. On July 27, 1995, the President's nominee to be the Deputy Secretary of the Interior, Mr. John Garamendi, appeared before the Energy and Natural Resources Committee and testified under oath, that the Ward Valley issue ``will be satisfactorily culminated shortly * * * and I believe it should be.'' With that testimony in mind, I recently reviewed documents made available under the Freedom of Information Act. With the benefit of those documents and other evidence of the systematic delay fostered by the Department of the Interior to block Ward Valley, I have reached the sad conclusion that Congress must intervene to end this stalemate. Before I go into the disturbing history of this issue and the content of the documents uncovered by the Freedom of Information Act request, some background is important. There is a tremendous difference between low level radioactive waste and the spent fuel issue the Senate has been debating over the past 2 weeks. Spent fuel, of course, is the high level waste from nuclear power reactors. Low level radioactive waste, on the other hand, is composed of items such as medical gowns, biomedical wastes, filters, resins and similar wastes generated from cancer treatment, biomedical research, and other activities. Low level radioactive waste is generated during cutting-edge research that may help us find a cure for AIDS. Low level radioactive waste is generated from the development of new drugs and cancer therapies. Low level radioactive waste is generated by the high tech and biotech industry in the quest for new products and services that will be at the foundation of our 21st century economy. While it also includes waste from nuclear power production, Congress wisely placed specific limits on the levels which are a State responsibility. When the Senate was debating the fate of high-level spent fuel, we clearly had a situation where the State of Nevada opposed a repository. The Governor of Nevada opposed it. But the low level waste issue is vastly different. Governor Wilson of California supports Ward Valley. The State of California has been working on plans open a low level waste repository in California for the past decade. They have done so in complete accordance with Federal law, which assigns responsibility for disposal of a specified portion of low level radioactive waste to the States. Governor Wilson understands that thousands of jobs in California, particularly among the high-tech and biotech industries, absolutely depend on having dependable access to a safe, secure facility for low level radioactive waste. Governor Wilson understands that countless lives might be saved through the cancer breakthrough or AIDS cure that the use of radioactive materials might bring. Governor Wilson also understands that low level radioactive waste is currently being stored at hundreds of urban locations all across California. It's being stored in basements and in parking lot trailers. It's being stored in warehouses and temporary shelters. It's on college campuses, in residential neighborhoods, and in hospitals. And as long as the waste is in these temporary locations in populated areas, it is subject to accidental radioactive releases from fire, earthquakes, and floods. Governor Wilson is understandably concerned about the health and safety of Californians. He is frustrated by the delays California has faced in trying to get this facility open. So am I. I am frustrated by the fact that the President's nominee to be the Deputy Secretary of the Interior, Mr. John Garamendi, appeared before the Energy and Natural Resources Committee on July 27, 1995 and testified under oath, that the Ward Valley issue should and would be quickly resolved. After that testimony, seven months passed. Nothing happened. On February 15, 1996, Deputy Secretary Garamendi indicated that ``new information'' related to a different low-level radioactive waste site at Beatty, Nevada, required further testing at the Ward Valley site and the preparation of yet another Supplemental Environmental Impact Statement (SEIS). Literally one day before his announcement, the Director of the U.S. Geological Survey said that linkages between the Beatty site and Ward Valley were ``too tenuous to have much scientific value.'' But the Deputy Secretary ignored the Director's scientific advice. In a public news conference, Deputy Secretary Garimendi indicated that the additional testing would take about four months, and that the preparation of a Supplemental Environmental Impact Statement (SEIS) would take about a year. On August 5, 1996, months after we expected the testing to be complete, an official of the lab Interior selected to perform the testing said, ``Interior Department officials have yet to submit a work plan . . . on the testing they want done.'' During this same time frame, Interior Department officials were distributing documents to the public containing factually incorrect information taken verbatim from Ward Valley opponents, even though accurate information was readily available from the Department of Energy. It now appears that Interior made no effort to check the facts with DOE with respect to the veracity of the information it was providing to the public. Recently, the Governor of California made me aware of documents he obtained through Freedom of Information Act (FOIA) requests. These documents reveal the following: Despite the understandable lack of radiological expertise resident in the Department of the Interior, the Department has made no effort to communicate with the federal agency with primary expertise and jurisdiction in the matter--the Nuclear Regulatory Commission. The professional, non-political, radiological experts of the Department of Energy have indicated that: ``Interior's concern that the [Ward Valley] facility lacks an environmental monitoring system has no basis in fact;'' the Department of the Interior is attempting to subvert the National Academy of Sciences recommendations with respect to the timing of the tests and nature of the tests to be performed; the Department of the Interior has understated the costs and the time required for the conduct of the tests; and the tests the Department of the Interior has outlined will result in additional litigation regardless of their outcome. Mr. President, these documents are plain on their face. But they are particularly troubling since they show the vast difference between the words spoken by Mr. Garamendi in his confirmation hearing, and the actions he has taken since his confirmation. Let's again review the facts: Deputy Secretary Garamendi testified under oath that the Ward Valley issue would be, and should be, quickly resolved. He then called for additional testing that did not conform to the recommendations of the National Academy of Sciences, creating a false linkage in the public's mind between the Beatty site and the Ward Valley site, despite the fact that his own USGS Director said that such a linkage could not be justified by the science. Deputy Secretary Garamendi spread misinformation about the composition of the radioactive waste stream in Department press materials supplied by project opponents, making no effort to check their veracity with the Department of Energy, the Nuclear Regulatory Commission, or any other agency with expertise in such matters. Deputy Secretary Garamendi persistently failed to get the testing underway, which he later blamed on the threats of a lawsuit that were not, in fact, made until long after the time he said the tests would be complete. Indeed, the Department of the Interior has designed a process specifically intended to foster further delay. Mr. President, over the past month or so there has been a new twist that is frankly the straw that breaks the camel's back. The State of California, in its continuing efforts to achieve a compromise, has agreed to perform additional testing pursuant to the National Academy of Sciences guidelines prior to the federal land transfer. Let me make this clear: California has always agreed to do the additional testing . . . the issue of dispute is that Interior insisted the testing be done prior to the land transfer, while California and the National Academy of Sciences said the testing would be best accomplished after the land transfer. So California has now agreed to perform additional testing prior to the land transfer. They have clearly made efforts to compromise. I received a letter from Deputy Secretary Garamendi, dated February 27, 1997, which exclaimed that the delays at Ward Valley have gone on long enough, and that welcomed the decision by the State of California to undertake additional testing. When I saw that letter. I thought to myself: Finally, this issue will be resolved. I was shocked by what happened next: The BLM produced an administrative determination, allegedly two years old that nobody had ever seen, that will not permit California to undertake the testing that Interior insists must be undertaken prior to the land transfer! They have California in a ``Catch-22.'' BLM informed the California Department of Health Services that they could not proceed with the testing without a new permit from the BLM and yet another biological consultation with the U.S. Fish and Wildlife Service with respect to the Desert Tortoise. The BLM based this requirement for a new permit on an ``administrative determination,'' allegedly issued two years ago, which limits surface disturbance associated with pre-construction testing. But further examination revealed several points about this document: This old administrative determination was unknown to the California Department of Health Services, U.S. Ecology, and even the local BLM District Office until weeks ago. The local BLM office is unable to provide any evidence that this ``administrative determination'' was provided to any of the parties whose actions it supposedly limits. The administrative determination is absurd on its face. The U.S. Fish and Wildlife Service has determined that the 90 acres of surface disturbance associated with the construction and operation of the Ward Valley facility will not jeopardize the desert tortoise or its habitat. Moreover, under current BLM guidelines, ten acre mining operations on other BLM land would not trigger the need for a biological consultation if certain desert tortoise protection measures were incorporated into the plan submitted to BLM. Indeed, five acre mining operations would not even require the applicant to submit a tortoise protection plan for approval. Yet, it is BLM's sudden contention that less than 5 acres of surface disturbance associated with testing will require yet another full biological consultation by the U.S. Fish and Wildlife Service. Clearly, Mr. President, this latest obstruction, and the reasons cited for it, make no sense in the context of the various other permits and administrative determinations that have been previously granted at the site. The fact that this administrative decision suddenly surfaced in the midst of state planning to undertake the new tests is highly unusual-- perhaps even worthy of investigation by the Inspector General. Mr. President, earlier this year I asked the General Accounting Office to investigate this matter. That investigation is now underway. At this very moment, GAO auditors are reviewing documents in the District BLM office in California and at Department of Interior headquarters here in Washington. The GAO report will not be complete until July 15, but let me simply say that their preliminary findings appear to agree with my understanding of the facts. What we are seeing at the Department of the Interior is a blatant display of bad faith and obstructionism with regard to California's efforts to implement Federal law through development of the Ward Valley site. I am particularly distressed by this, particularly in light of the words spoken by Mr. Garamendi at his confirmation hearing. Mr. President, the legislation I am introducing today would convey the BLM land at Ward Valley to California as soon as a check for the fair market value of the land plus $100 is tendered to the Secretary of the Treasury, after the State of California formally tenders a promise to conduct the additional testing as outlined by the National Academy of Sciences. It's a simple bill. California agrees to do the testing outlined by the National Academy of Sciences, California gets its site, and the taxpayer gets fair market value for the land. I am willing to consider alternative approaches, but my bottom line is a quick and satisfactory resolution to this issue by qualified experts rather than political activists. I am willing to entertain negotiated compromises. I am willing to entertain alternative legislative approaches. I am not willing to entertain further delay. In closing, Mr. President, let me share a story that I find particularly rich in irony: Interior Secretary Babbitt, while the Governor of Arizona, was deeply concerned about the difficulty of the Federal Government to provide for adequate low-level radioactive waste disposal sites. He was asked by the National Governors' Association to chair a task force to look into the problem. The Babbitt task force recommended that the responsibility for low- level radioactive waste management be given to the States. In 1981, Governor Babbitt wrote that ``the siting of a low level nuclear waste facility involves primarily state and local issues that are best resolved at the government level closest to those affected.'' There was another Governor at the time who was active in the National Governor's Association and supported this approach: The Governor of Arkansas. His name was Bill Clinton. Congress listened to these Governors, and passed the Low Level Radioactive Waste Policy Act which gave the States the responsibility for low level radioactive waste management. California is the first State to license a facility under the Low Level Radioactive Waste Policy Act. And who are the Federal authorities who are today frustrating California's attempt to follow the law and open its site? None other than Mr. Babbitt and his Deputy at the Department of the Interior, himself a former California state official. What an irony that former State officials would declare a State unworthy of trust in carrying out its congressionally assigned duties and responsibilities. What a difference a few years in Washington can make.

Mr. MURKOWSKI

Mr. MURKOWSKI. We are not keeping time, I would advise my friend from Nevada. So I have yielded the floor.

Mr. MURKOWSKI. Mr. President, I thank the Chair. I have listened to my good friend from Arkansas embellish one of his favorite subjects, and that, of course, is the American mining industry as we know it today. I think it is fair to say that we have had, with the minority, a continuing, ongoing effort to try and bring about changes in our mining law--meaningful changes that are supported by the industry, meaningful changes that are supported by the minority. Unfortunately, we haven't been able to generate a resolve of many of these issues. But I think it is fair to say that the attack today proposed by my friend from Arkansas is not just an attack on the percentage depletion allowance, but, in reality, it is an attack on the American mining industry as we know it today. Now, I don't know about my friend from Arkansas coming over here, but I didn't run into anybody in the Halls. I didn't run into any lobbyists. Nobody has talked to me. I venture to say that if you walk out now, you won't run into any either. What we are looking at here is a matter of equity for an industry that is very important to our Nation, to our security interests, who must compete in a worldwide marketplace. We are either competitive or we are not. For the information of my friend from Arkansas, the value, in 1995, of the combined contribution of the mineral industry to Arkansas was $744 million. So when he says ``they don't pay one red cent,'' well, they contributed $744 million to the economy of Arkansas. In Alabama, it is $2 billion; in Arizona, it is $9 billion; in Texas, it is $7 billion; in New York, it is $8.3 billion. So when you say they don't pay anything, let's look at the working men and women in the mining industry today, and let's look a little more closely at reality. What is proposed by my friend from Arkansas--and he is right, it is a punative proposal, as he has been working at it for 9 years and he is committed until the day he leaves to work on it. I admire that spirit. But he is not telling you the whole story. There was a proposal by the administration earlier this year to do away with percentage depletion for this industry. And the important thing, Mr. President--and I would like my friend from Arkansas to acknowledge the reality of it--it was rejected by both the Finance Committee in the Senate and the House Ways and Means Committee, and it should also be rejected by the full Senate. When you strip away the rhetoric--and there is lots of it around here--on this matter, the issue boils down to one simple question: whether this body wants to go on record now in support of a nearly $700 million tax increase on the domestic mining industry. We talk about tax bills, we talk about tax breaks, we talk about stimulating how much more earnings the average family member can make and take home and save. But this proposal by my friend from Arkansas would tax America's mining industry an additional $700 million--and this is a domestic industry, mind you. Well, I think it is fair to say--and I think most of you would agree--that the Treasury will never see anywhere near $700 million from this proposal, because this latest assault on the industry will simply speed up one thing--the departure of the mining industry from our shores. This is a worldwide market. You compete or you don't compete. Now, the continuing decline of this industry is reflected on the chart I have on my left. As my colleagues can see, jobs in this industry have been declining dramatically. Let's look at it. Metals make up the gold, silver, lead, and zinc production. The others are in iron ore and copper. In 1980, we had 98,000 jobs; today, we have 51,000 jobs. This is the gold, silver, lead, and zinc. That is not to assume we are not using as much gold, silver, lead, and zinc. We are. We are importing it from other countries. Why? Because we are not as competitive in the world marketplace. Iron ore. In 1980, we had 21,000 workers. In 1995, we had 9,000. Where has the industry gone? It has gone to South America, South Africa. That is the reality we live under. Now, does my friend simply want to tax this industry another $700 million and drive it offshore? That is what is going to happen, make no mistake about it. The copper industry. In 1980, 30,000 jobs; today, 15,000 jobs in the United States It isn't that we don't have the minerals. We are not competitive in an international marketplace. My friend from Arkansas simply ignores that reality. He never mentions it. It is always they are getting a free ride. He doesn't mention the jobs that are created in each State or the contribution associated with what that prosperity means to the families. I think it is important to point these things out. These are accurate figures. This is the condition of the industry today. It competes worldwide. The jobs, Mr. President, that have disappeared are good- paying jobs. Make no mistake about it, these are not the MacDonalds minimum-wage jobs. The average yearly wage for miners is nearly $46,000, one of the highest wage levels of any segment of America's workers. That doesn't include the benefits provided for these workers. What does the Senator from Arkansas propose to do with these workers if you tax the industry that much more? Are these people going to be retrained? They are going to be out of a job. They are going to be on welfare. You know where these jobs are going to go. They are going to go to Latin America, Canada, Indonesia, the Philippines, and Central Asia. For example, gold mining exploration budgets have been dipping in the United States from a high of $149 million in 1992 to $120 million in 1996. But at the same time spending in Central and South America has increased more than five times--from $28 million in 1992 to $145 million last year. These are investments that could have and should have been made in the United States but for the hostile environment that this industry, which is a basic industry in the United States, faces at home. If this tax increase is approved, we will merely hasten the further decline of this domestic industry, for instead of using capital to invest in exploration and development in new sites in the United States, the mining industry will be forced to abandon new projects at home. It will have to close marginally profitable mines with the loss of hundreds, if not thousands of permanent good-paying jobs. Mr. President, the underlying predicate of this amendment, I think, is fatally flawed for it assumes that mining operations on Federal lands are cost-free. That is what my friend from Arkansas said. He said ``not one red cent'' did they pay for it. Nothing is further from the truth. Mining operations on Federal lands are not cost-free. It is a myth that patenting of land under the Mining Act of 1872 is somehow an easy event; that it simply is as easy perhaps as going out and writing a check to the Federal Government. That is not reality. The reality is that the exploration process leading to the discovery of valuable mineral deposits can cost several hundreds of thousands of dollars per claim just for the drilling, the sampling, and the expense associated with proving up that claim. I also note that in some cases mineral patent applications can contain as many as 500 claims per application, and the cost of processing a single claim can run $35,000 to $40,000 to $45,000. Multiply that by 400 or 500 claims. What do you have? You have $19 million in costs merely for processing claims. So when the Senator from Arkansas says they are not ``paying one red cent,'' that is not reality. Moreover, the time required to explore land and permit it before mining begins has increased dramatically, with a concomitant increase in the cost of mining. The average time for simply permitting new mines, as my friend from Arkansas is well aware, on Federal land has increased from 1 year to 3 to 5 years. And over the course of the last 4 years it has averaged close to 5 years. Where is it going to be in another few years? At some point in time you are going to overload this. They are not going to be competitive in the domestic market. Where are they going? They will go where they have to go to survive, and that unfortunately is outside the United States. Once the companies have passed all of the hurdles, a company then faces the daunting capital costs that are associated with bringing a modern mine on line. This isn't like the chicken industry. This is an industry that is volatile relative to costs. Costs are not necessarily controllable in the mining industry because you run into different types of production exposure. Some of it is very, very deep. Some of it can have water in the mines. There are many, many unknowns associated with that. And the biggest risk is that you develop a mine and you have no assurance that your price is going to stay stable. The price fluctuates dramatically. But you have made a tremendous capital investment, and you are risking this capital relative to your belief that you can operate an efficient mine, an efficient operation, and control costs. But the unknowns are very, very high. In my own State, we recently opened a mine called the Fort Knox Mine which began operations outside Fairbanks. The company invested nearly $375 million in capital before a single ounce of gold had been mined, or refined, on that project. So they don't pay a red cent. They put up $375 million in advance on the supposition that they would be able to generate a reasonable return. Now the price of gold has dropped to a point where their margins are within a couple of dollars. That is the reality associated with that kind of a business. I think my colleagues will agree that there is no free ride when it comes to the cost of exploration, acquisition, development, and processing in the industry--whether on Federal or private land. Yet, the amendment before us assumes little or no costs to the industry when mining on Federal land. Mr. President, the rationale for the percentage depletion allowance is it recognizes the unique nature of resource depletion by providing a realistic and practical method for the creation of funding necessary to replace the diminished resource. Moreover, percentage depletion reflects reality. This is a reality unlike in the chicken business. It is a reality that when the mines are exhausted, the companies must replace the depleted deposits of mineral resources, which are more difficult and in many cases more expensive to develop. These new deposits, because of lower grade ores, could create more difficulty in mining and development. They could be more expensive to operate. So where do you go after you deplete your mine and when the economics are that you can't generate a recovery? You go find a new one to stay in business, and hopefully it will be of the quality of the last one. But you have no guarantee. Hence, the justification for the percentage depletion allowance, as it responds to the unique nature of mineral deposits, provides for realistic and practical methods of reflecting the decreasing value of a mine as the mine is depleted. That is what it is all about. It helps companies maintain the capital necessary to make future investments for replacement of mineral resources. I would also note that minerals are commodities whose prices are set, as I said, by the world marketplace. With an increase in mining costs with the repeal of the percentage depletion allowance, what are you going to do? You can't pass it on to the purchasers in the form of higher selling prices. You either absorb it and take a loss and ultimately if your losses are too high, you go out of business. Mr. President, I would also point out that mining companies commonly package mining rights from a variety of sources into a single operation. For example, a large open-pit mining operation may include private property acquired through homestead laws, patent and mining claims, unpatented claims, States lands, and so forth. The repeal of percentage depletion--as proposed by my friend from Arkansas--from those mining rights which originate with the mining law of 1872 would require a complex system, so complex that we would have to track every single shovel of ore on the mining site. In other words, some of it would be from lands that originated through private property, homestead laws, unpatented claims, State lands. How do you sort that out? What will likely be the result is that the depletion allowance would apply to a shovel of ore from one location but not a shovel of ore from an identical ore body 10 feet away. That is simply absurd. But that is the solution that is suggested in this amendment. Mr. President, I think there is no doubt that percentage depletion for minerals in mines on Federal lands is clearly appropriate tax policy. But I would suggest to all of my colleagues that this amendment is not about depletion on lands obtained under the Mining Act of 1872. As I indicated in my opening statement, this amendment is about the act itself. This is really just another attempt to gain leverage on the industry by attacking the depletion allowance. Remember, Mr. President, by adopting the proposal in the amendment of the Senator from Arkansas, we would be going on record as supporting nearly a $700 million tax increase on America's domestic mining industry. I can categorically state, Mr. President, that the U.S. mining industry agrees, they agree with the Senator from Arkansas, that the mining law of 1872 is substantially due for an overhaul. And we have passed reforms, ultimately to see them vetoed by the President. But I continue to work to see that this law is reformed. I continue to work with my friend from Arkansas and my colleagues on the other side to accomplish such a result, and we have been doing it for the last several years. The industry has supported the concept of a 5- percent net proceeds royalty, a fair market value for land--a fair market value for land--a permanent maintenance fee, and the earmarking of revenues generated from mineral production on Federal lands to create and fund abandoned mines and cleanup programs. These are the things that are mentioned by my friend from Arkansas. He is concerned about abandoned claims and the cleanup. We provide for that in our proposed legislation. The Senator from Arkansas makes quite a point of the wide variance in royalties. What he doesn't point out is that the royalty agreements on private lands are just that. They are agreements. Those agreements are made between two parties. The determination of what the costs are to be allocated out is something that the Senator from Arkansas doesn't look into. He just simply says, ``Well, there is a 10-percent royalty here. There is an 11-percent royalty here. And the 5-percent royalty is not applicable.'' You have to go into what the royalty consists of. A 5-percent net proceeds royalty is fair. It is one that I support. A number of my colleagues basically support substantial changes in the 1872 mining law which we are attempting to address and hope to have before this body yet this year. There are a couple of other interesting things, Mr. President. The administration has never sought to develop compromise legislation that reforms the 1872 law while offering the U.S. mining industry the economic ability to develop Federal mineral assets. That is a fact. This amendment, as with the administration's identical budget proposal, is clearly designed to bring the industry to its knees by putting a $700 million tax on the industry. Remember, as we reflect on the merits, that this matter has been studied and gone into in great detail by both the House and the Senate--the Senate Finance Committee and the House Ways and Means Committee. Both have said, no, this increased tax on the mining industry of $700 million is not justifiable. So it is acknowledged we want to overhaul the 1872 mining law, but that is not what we are debating today. What we are debating today in this amendment is an amendment that would simply kill the domestic mining industry in this country, make no mistake about it. As you look at the merits of an adequate royalty, it has to be based on consideration of comparisons that are real. Just what is the negotiated in and out of a higher royalty figure does not necessarily represent the return to the Government agency. This is modeled exactly after the royalty program that is currently operating in one of the most prosperous States for mining, and that is the State of Nevada. My colleagues from Nevada I see are on the floor. I am sure that they will point that out. So, in conclusion, let us recognize where we are on this. This is a $700 million tax proposal on our mining industry, our domestic industry. One final point I would like to bring up is the matter of germaneness. This amendment is not germane. This amendment does not belong on this bill. At the appropriate time a point of order will be made. I urge my colleagues not to support a waiver of the point of order. Mr. President, I yield the floor. Mr. BRYAN addressed the Chair.

Mr. MURKOWSKI. I think we have a number of Senators on our side we want to accommodate so why not let them speak as long as they want.

Mr. MURKOWSKI. Mr. President, if I may, I ask unanimous consent to have printed in the Record an article from the Wall Street Journal called ``Gold Mining Firms Act to Meet Price-Slump Challenge,'' which I think makes my point to the increasing of difficulty in meeting production costs with the declining price of minerals in the world marketplace today.

Mr. MURKOWSKI

Mr. MURKOWSKI. Mr. President, the utility industry is undergoing drastic change as a result of deregulation. I know that municipal utilities are concerned about the tax-exempt status of their outstanding debt if they enter the competitive market. I also know that investor-owned utilities are concerned about municipal utilities using their tax-exempt debt and their tax-exempt status to gain an unfair competitive advantage. In addition, there are a host of issues relating to how electric cooperatives will fare in the emerging competitive marketplace. I believe that we need to re-examine the Tax Code to determine how best to ensure a level playing field in the era of electricity deregulation and competition. Because of the importance of this issue to consumers, investors, the electric power industry, and to our economy, as I told Treasury Secretary Rubin in an April 22 letter, I believe this is a matter for Congress, not the IRS, to decide.

Mr. MURKOWSKI. Mr. President, I have asked the Joint Committee on Taxation to prepare a complete analysis of tax provisions relevant to the electric utility industry. Once this report has been prepared, I believe our committees should hold hearings and make recommendations once we have had a chance to thoroughly examine these issues.

Mr. MURKOWSKI. Mr. President, I thank the chairman of the Finance Committee and I look forward to working with him.

Mr. MURKOWSKI

Mr. MURKOWSKI. With reluctance, I ask support of this amendment, and obviously it has been done. But I want to make the point that the provision in the current bill is one that we have all committed to, and that is of having the strategic petroleum reserve and the reality that we are addressing it with the crisis on the budget. That is not the purpose. The Akaka amendment provided a purchase mechanism after 2002. I think it is the right policy for this Nation, and we are only talking about $13 million a year. I think that is a small price to pay for energy security, but nevertheless recognizing the circumstances, why, I reluctantly ask support.

Mr. MURKOWSKI. I thank Senator Akaka for his role in encouraging the support of the strategic petroleum reserve.