Craig Thomas

Mr. THOMAS

Mr. THOMAS. Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on Thursday, May 22, 1997, to conduct a hearing on electronic funds transfer and electronic benefit transfer and the effect of these programs on Federal benefit recipients.

Mr. THOMAS. Mr. President, I ask unanimous consent that the Senate Committee on Commerce, Science, and Transportation be authorized to meet on May 22, 1995, at 9:30 a.m. on oversight of professional boxing.

Mr. THOMAS. Mr. President, I ask unanimous consent that the Committee on Labor and Human Resources Subcommittee on Public Health and Safety be authorized to meet for a Hearing on Substance Abuse and Mental Health Services Administration [SAMHSA] during the session of the Senate on Thursday, May 22, 1997, at 9:30 a.m.

Mr. THOMAS. Mr. President, I ask unanimous consent that the Committee on Rules and Administration be authorized to meet during the session of the Senate on Thursday, May 22, 1997, beginning at 9:30 a.m. until business is completed, to hold a hearing to consider revisions to title 44/GPO: Review and Recommendations of Draft Legislation.

Mr. THOMAS. Mr. President, I ask unanimous consent that the Select Committee on Intelligence be authorized to meet during the session of the Senate on Thursday, May 22, 1997, at 2 p.m. to hold a closed hearing on intelligence matters.

Mr. THOMAS. Mr. President, I ask unanimous consent that the Subcommittee on Antitrust, Business Rights, and Competition, of the Committee on the Judiciary be authorized to meet during the session of the Senate on Thursday, May 22, 1997, at 2 p.m. to hold a hearing on: ``Antitrust Implications of the College Bowl Alliance.''

Mr. THOMAS. Mr. President, I ask unanimous consent that the Subcommittee on East Asian and Pacific Affairs of the Committee on Foreign Relations be authorized to meet during the session of the Senate on Thursday, May 22, 1997, at 10 a.m. to hold a hearing.

Mr. THOMAS

Mr. THOMAS. Mr. President, we are going to, this week, enter into one of the most serious debates that we will have all year, one of the matters that I think is the most serious that we will address all year, and that is the question of the budget. As a matter of fact, it is my understanding we will talk about two budgets. One will be the appropriations for the supplemental budget, designed to deal with disaster and other matters, but then the real budget for the year which will outline the spending for this country. I think this is important, particularly important, because there is much more to it than arithmetic. It is not simply numbers. It is not simply what we will spend. I think it has to do with a number of things that are of particular significance. I hope that we give some consideration to these broader things as we talk about numbers, which we inevitably will do. One has to do with the size of the Government. It has to do with the potential and the opportunity to reduce the size of Government. I happen to believe that Government has become too large and that it could be smaller. It could be much more efficient. I suspect it would be more efficient if it were smaller. The budget is one of the ways that you do that. Government by its nature does not get smaller unless somehow there is a restriction on the amount of money available. I think it also gets more efficient when there is less money to do the job, and it is similar to what has to be done in the private sector. Second, it has, of course, to do with priorities. Each of us, as we spend our money, whether in business or personal and private family lives, have to set priorities. There is never enough money for everything. Certainly that is increasingly true with Government. So it is necessary to set priorities, to decide which of the many functions of Government are most important, which ones need to be financed, which ones need to be funded, which ones, indeed, could be reduced or eliminated. Third, it has to do with taxing. It has to do with how much money we are going to allow families to keep, to spend for themselves. Average family spending for taxes now is nearly 40 percent, 40 percent of revenue from the family. It was just recently that we had tax day, so that everything we earned up until just a week or so ago all went for taxes. The budget has to do with the potential, the possibility of reducing the burden on the families in this country. It has to do with the incentive for investment. Tax reduction is also an opportunity to have investments for people to put into their businesses, to create jobs, to strengthen the economy. There is a direct relationship, particularly in tax reductions such as capital gains which encourages people to invest. The budget gives us an opportunity to keep Medicare and entitlements available. I just met this morning with a great group of young people, high school people. We talked a little bit about entitlements. We talked specifically about Medicare. Frankly, all of them, 18 years old, said, ``We really do not think there will be any Medicare for us.'' Indeed, there will not be unless we make some changes. Budgets, of course, are where it is possible to do that. Budgets also test our willingness to be financially responsible, to balance the budget and not spend more than we take in, which we have done for more than 30 years here in this Congress. I have to say I have not done it for 30 years because I have not been here for 30 years. Finally, and related to that, of course, budgets determine what will we leave to our kids to pay in terms of budgets, in terms of debts. What we have done, of course, over the last few years, is we have spent more than we took in and put it on the old credit card, and it is maxed out. So we will determine how much of a debt we leave to our kids. That is what we are talking about in terms of budgets. It will be difficult. It will be difficult. American voters, as someone said, and I think it is true, sent two teams to do the same thing, two teams with quite different philosophies. If everyone here had the same philosophy then we would have a certain kind of a budget. If everybody believed we ought to have smaller Government, we would have smaller Government. If everybody thought we ought to have more tax relief, we would have that, but everybody does not. There are two different points of view that will have to be reconciled before anything can be done. So we approach a budget with, I think, a certain amount of reserve. Certainly this is not a breakthrough budget. This is not a turnaround. This is not a change, a sea change, I do not believe. I do not think it is designed for meaningful reduction in the size of Government or spending reductions. It is not dedicated to real honest-to-goodness tax relief. Now, on the other hand, I think in fairness, and we will have to talk about it, it does provide some of the principles that most of us have talked about for some time. It probably comes closer, and I hope it does, to a real balance than any budget in recent history over a period of 5 years, a real balanced budget. Now you have to keep in mind you can balance the budget in many ways. You can continue to increase taxes and increase revenue and balance the budget up here, when the real idea that most people want to balance the budget is down here, and reduce some of the spending. Second, it provides some tax relief. We are told that there will be an opportunity on the floor for debate of tax relief. One will be $500 per child for family relief. That is good. Another would be some relief of capital gains taxes. That is good. It will help the economy. And in the short term, at least, it will increase revenues. Some reduction in estate taxes, I think, is good. In my State of Wyoming, there are lots of family farmers, ranches, and small businesses. People have worked all of their lives--and many times the lives of their forebears--to put together a business or a ranch or a farm, often with relatively little flow of cash but lots of assets. Under the present circumstances, that is taxed at nearly 50 percent. Many have to sell those assets in order to pay the taxes. That ought to be changed. There will be some effort made at entitlement reform. That is good. It helps preserve Medicare for people who will be on it in the future. There has to be some changes made to do that. So it is a kind of a mixed bag, it seems to me. There are some other items I would like to see changed. I would like to see some incentives to increase the capital gains so that there is incentive to invest in the economy. I would like to see some real long-term meaningful changes in Medicare so that our kids will have a chance. The President has sort of tinkered around the edges, and takes down the providers' cost a little here and there to avoid any real tough decision, but he is doing a little something. We have to make them. The sooner we make them, the less costly they will have to be. We need to allow families to keep more of their dough. We need to be careful about balancing the budget and about making very optimistic projections in the future. Suddenly, there was $200 billion-plus because of the projections for the future. We ought to make kind of a level projection, it seems to me. And then, if we are fortunate enough to have revenue growth, why not apply that to the debt? Wouldn't that be a nice idea? But no, we put that on so that we continue to spend and see the Government grow larger. These are some of the things we will be grappling with this week. I think they are very difficult ones, and some things I hope we do regardless of what we do with the tax bill, regardless of what we do with the budget. I hope we move on past that to reform the tax system. The tax system needs to be changed. People are increasingly complaining about the IRS. And I understand that. The tax issue is not going to change the IRS a great deal until you change the system that they have to enforce. We ought to do that. This budget should not mean we are going to leave it as it is for 5 years. We need meaningful reductions in taxes. We need a smaller Government. We need to change the situation so that the Government doesn't compete with the private sector in those things that the Government does that are commercial in nature. We ought to allow for contracting, and let private small businesses be able to compete to do things that the Government does that are basically commercial. Mr. President, there is something else that I think we ought to do that would help us. We ought to have a biennial budget. We spend almost all of our time with this budget. We started this thing just about this time in January when the Congress came in. We will be very fortunate if we are through by the middle of September or the 1st of October. And, as you know, Mr. President, it has been longer than that in the past. It wouldn't take any longer to do it on a biennial basis. We could know those figures just as well. The agencies would have 2 years of knowing where their money is going to be. But, most important of all, we could have the budget one year and the next year do oversight. That is part of Congress' responsibility, to oversee the things that the Government is doing. We can accomplish a great deal, if we can do that. So, Mr. President, I look forward to this week's debate and discussions. I am confident we will come out of it with something better than we have had. Thank you for the time. I yield the floor. Mr. SANTORUM addressed the Chair.

Mr. THOMAS

Mr. THOMAS. Mr. President, I ask unanimous consent to speak for 7 minutes as in morning business.

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

Mr. THOMAS

Mr. THOMAS. Mr. President, I am sorry we have moved into some of our time, but I will be very brief and cover the points I want to make. I am real pleased today to be joined by three of my associates in support of H.R. 1122, the Partial-Birth Abortion Act. I am going to be very brief. It has been talked about to a great extent. Everything, probably, has been said. But there is one thing that sticks in my mind that I think is important about this discussion and this vote that will come up. We did this last year, you will recall. It passed by significant numbers in the Senate. President Clinton vetoed the bill that was passed in the 104th Congress. I just want to mention the reasons that he gave for vetoing the bill. First, he said it was only necessary in ``a small number of compelling cases.'' The fact is that is not factual. The fact is that has changed. The fact is, there are facts that show, for instance, in New Jersey, that there were more than 1,500, just in the one State. So that reason for vetoing is not true. It is not true. The second one was to protect the mother from ``serious injury to her health.'' The fact is, in the vast majority of cases when the partial- birth technique is used, it is for elective purposes, and that, also, has been shown to be true. Third, the President said, to avoid the mother ``losing the ability to ever bear further children.'' The facts have now shown it is never necessary to safeguard the mother's health or fertility; that there are other procedures that are available. I think these are compelling, compelling arguments. These are the reasons the President vetoed the bill that have subsequently been found not to be factual. I yield time to the Senator from Nebraska.

Mr. THOMAS. No, sir, I am asking that we finish the 10 minutes we were allocated and then transfer to you to do it in the method that you asked.

Mr. THOMAS. Reserving the right to object, is there time left on our original 10 minutes?

Mr. THOMAS. I wonder if it would be possible for us to go ahead and finish and then do it as the Senator described?

Mr. THOMAS

Mr. THOMAS. Mr. President, I would like to announce for the public that a hearing has been scheduled before the Subcommittee on National Parks, Historic Preservation, and Recreation of the Committee on Energy and Natural Resources. The hearing will take place on Wednesday, May 21, 1997, at 2 p.m. in room SD-366 of the Dirksen Senate Office Building in Washington, DC. The purpose of this hearing is to receive testimony on Senate Resolution 57, to support the commemoration of the bicentennial of the Lewis and Clark Expedition; S. 231, the National Cave and Karst Research Institute Act of 1997; S. 312, to revise the boundary of the Abraham Lincoln Birthplace National Historic Site in Larue County, KY; S. 423, to extend the legislative authority for the Board of Regents of Gunston Hall to establish a memorial to honor George Mason; S. 669, to provide for the acquisition of Plains Railroad Depot at the Jimmy Carter National Historic Site; and S. 731, to extend the legislative authority for construction of the National Peace Garden Memorial. Because of the limited time available for the hearing, witnesses may testify by invitation only. However, those wishing to submit written testimony for the hearing record should send two copies of their testimony to the Subcommittee on National Parks, Historic Preservation, and Recreation, Committee on Energy and Natural Resources, U.S. Senate, 304 Dirksen Senate Office Building, Washington, DC 20510-6150. For further information, please contact Jim O'Toole of the subcommittee staff at (202) 224-5161. committee on energy and natural resources

Mr. THOMAS

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

Mr. THOMAS. Mr. President, I would like to take just a couple of minutes to rise in support of the Individuals With Disabilities Education Act. I have a particular interest in this bill in that I have been involved for a very long time with disabilities, chairman of the disabilities council in Wyoming, my wife teaching special kids, and so I wanted to comment very briefly. I rise in support of the current bill to reauthorize IDEA, the Individuals With Disabilities Education Act. The Federal Government, in my view, should and does play a rather limited role in elementary and secondary education. This is the responsibility generally of communities, those of us who live there. State and local control, I think, is the strength of our educational system, and yet I believe strongly that this is an appropriate Federal responsibility. This is dealing with that kind of a special problem which exists in all places to ensure that every child has the opportunity to be the best that he or she can be. IDEA helps local schools meet their constitutional responsibilities to educate everyone, and that is what we want to do. Today nearly twice as many students with disabilities drop out of school compared to students without disabilities, and that is what it is about, to have a program that helps keep students in school. S. 717 does not have as much punch as legislation considered in the last Congress. Some issues about discipline and litigation were impossible to resolve last year, and therefore there was no reauthorization. This bill, as I understand it, represents a consensus. It is a product of negotiation. No party involved, as usual, received all they had hoped for, but nevertheless it is a fair approach. It is a step in the right direction. This bill has had a very long journey. We owe it to our local school districts to pass this reauthorization legislation that has been stymied for several years. Education is clearly an issue that is on the minds of all of us. It is on the minds of Wyomingites. There is a great deal of uncertainty regarding the future and shape of secondary and elementary schools in Wyoming. State legislators currently are scrambling to provide a solution to a Supreme Court ruling that funding and opportunities must be allocated more uniformly and fairly across districts in Wyoming. I am hopeful that Congress can pass this IDEA legislation and eliminate at least one of the sources of uncertainty for educators and, more particularly, for parents in my State. Since its original passage in 1975, it has become clear that there are improvements that are necessary to IDEA. Wyoming teachers and administrators have contacted me expressing concern about the endless paper trail. I hear that every night, as a matter of fact, at home; as I mentioned, my wife teaches special kids and spends, unfortunately, as much time in paperwork as she does with kids. That is too bad. They complain the current law is unclear and places too much emphasis on paperwork and process rather than actually working hands-on with children. The bill we have before us today attempts to reduce paperwork associated with the individualized educational plan. Teachers and administrators also write to me, and I am sure to my fellow Senators, to ask for strengthening of the discipline and school safety provisions of the law. They want power to take steps necessary to assure that schools are safe for all children. S. 717 would give the power to school officials to remove disabled students who bring weapons or drugs to school and keep them out for as long as 45 days pending a final decision. This will give educators a clearer understanding of how they are able to exercise discipline with disabled children, as they should be able to. IDEA has also proved to be a highly litigated area of law. This bill will require that mediation be made available in all States as an alternative to the more expensive court hearings. Mediation has been shown effective in resolving most of these kinds of disputes. Meeting with the mediator will help school professionals and parents reach agreements more quickly. In summary, S. 717 will help cut down on the overregulatory nature of IDEA. It will allow parents and educators to work out differences by using noncontroversial and nonadversarial methods. It will go a long way toward allowing all children to learn free from danger and serious disruption. And, therefore, Mr. President, I urge that this bill be passed, that we make more certain the opportunities for disabled children in schools throughout the country. I yield the floor.

Mr. THOMAS

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

Mr. THOMAS

Mr. THOMAS. Mr. President, I rise today to introduce the Electric Utility Restructuring Empowerment and Competitiveness Act of 1997. This legislation, which gives states the authority to order the delivery of electric energy to all retail consumers, is based on the idea that less government intervention is the best way to achieve affordable, reliable and competitive options for retail electric energy services. This is a substantially different approach from other measures that have been introduced in both the House and Senate to restructure the nation's electric utility industry. I do not believe that a federal mandate on the states requiring retail competition by a date certain is in the best interest of all classes of customers. I am concerned that this method could result in increased electricity rates for low-density states or states that have relatively low-cost power. Electricity is an essential commodity critical to everyday life in this country. It is also an industry heavily regulated at the Federal and State levels. If the Congress is going to make fundamental changes to the last major regulated monopoly, its role should be to help implement competitive changes in a positive manner, rather than interject the heavy hand of government with a ``Washington-knows-best'' mentality. This legislation comes down on the side of States' rights. Having been involved in the electric power industry, I understand the unique characteristics of each State. As most everyone knows, California was the first State to pass a retail choice law. Since that time, Arizona, Massachusetts, New Jersey, Pennsylvania, New Hampshire, Texas, Montana, Oklahoma and others have followed suit. According to Bruce Ellsworth, President of the National Association of Regulatory Utility Commissioners [NARUC], ``more than one-third of the Nation's population live in states that have chosen within the last year to move to open-access, customer choice markets.'' All told, every state except one is in the process of either examining or implementing policies for retail consumers of electric energy. States are clearly taking the lead--they should continue to have that role--and this bill confirms their authority by affirming States' ability to implement retail choice policies. This initiative leaves important functions, including the ability to recover stranded costs, establish and enforce reliability standards, promote renewable energy resources and support public benefit and assistance to low-income and rural consumer programs in the hands of State Public Service Commissions [PUC's]. If a State desires to impose a funding mechanism--such as wires charges--to encourage that a certain percentage of energy production comes from renewable alternatives, they should have that opportunity. However, I do not believe a nationally mandated set-aside is the best way to promote competition. Likewise, individual states would have the authority over retail transactions. This ensures that certain customers could not bypass their local distribution system and avoid responsibility for paying their share of stranded costs. One of the most important aspects of this debate--assuring that universal service is maintained--is a critical function that each State PUC should have the ability to oversee and enforce. In my legislation, nothing would prohibit a state from requiring all electricity providers that sell electricity to retail customers in that state to provide electricity service to all classes and consumers of electric power. Mr. President, at the wholesale level, my proposal attempts to create greater competition by prospectively exempting the sale of electricity for resale from rates determined by the Federal Energy Regulatory Commission [FERC]. Although everyone talks about ``deregulating'' the electricity industry, it is really the generation segment that will be deregulated. The FERC will continue to regulate transmission in interstate commerce, and State PUC's will continue to regulate retail distribution services and sales. When FERC issued Order 888 last year, it allowed utilities to seek market-based rates for new generating capacity. This provision goes a step further and allows utilities to purchase wholesale power from existing generating facilities, after the date of enactment of this Act, at prices solely determined by market forces. Furthermore, the measure expands FERC authority to require non-public utilities that own, operate or control transmission to open their systems. Currently, the Commission cannot require the Federal Power Marketing Administrations [PMA's], the Tennessee Valley Authority [TVA], municipalities and cooperatives that own transmission, to provide wholesale open access transmission service. According to Elizabeth Moler, Chairwoman of FERC, approximately 22 percent of all transmission is beyond open access authority. Requiring these non- public utilities to provide this service will help ensure that a true wholesale power market exists. One of the key elements of this measure is streamlining and modernizing the Public Utility Regulatory Policies Act of 1978 [PURPA] and the Public Utility Holding Company Act of 1935 [PUHCA]. While both of these initiatives were enacted with good intentions, and their obligations fulfilled, there is widespread consensus that the Acts have outlived their usefulness. My bill amends section 210 of PURPA on a prospective basis. Current PURPA contracts would continue to be honored and upheld. However, upon enactment of this legislation, a utility that begins operating would not be required to enter into a new contract or obligation to purchase electricity under section 210 of PURPA. With regard to PUHCA, I chose to incorporate Senator D'Amato's recently introduced legislation in my bill. As Chairman of the Senate Banking Committee, which has jurisdiction over the issue, he has crafted a proposal that I believe will successfully reform the statute and I support his efforts. Under his proposal, the provisions of PUHCA would be repealed 18 months after the Act is signed into law. Furthermore, all books and records of each holding company and each associate company would be transferred from the Securities and Exchange Commission [SEC]--which currently has jurisdiction over the 15 registered holding companies--to the FERC. This allows energy regulators, who truly know the industry, to oversee the operations of these companies and review acquisitions and mergers. These consumer protections are an important part of PUHCA reform. Mr. President, an issue which must be resolved in order for a true competitive environment to exist is that of utilities receiving special ``subsidies'' by the federal government and the U.S. tax code. For years, investor-owned utilities [IOU's] have claimed inequity because of tax-exempt financing and low-interest loans that municipalities and rural cooperatives receive. On the other side of the equation, these public power systems maintain that IOU's are able to receive special tax treatment, not offered to them, which amounts to a ``tax free'' loan. The jury is still out on how best to deal with this thorny and, undoubtedly complex matter, but make no mistake about it, changes will be made. A viable option the Congress should consider is to ``build a fence'' around governmental utilities. Sales in existing service territories could continue to be financed using current methods. However, for sales outside of their traditional boundaries, these systems should operate on the same basis and play by the same rules as other competitors. The Congress should also address existing tax structures to determine if the ``benefits'' tax-paying utilities receive results in unfair advantages against their competitors. While tax initiatives, such as accelerated depreciation and investment tax credits, are available to all businesses that pay income tax, if this amounts to ``subsidies'' reforms may have to be made. My bill would direct the Inspector General of the Department of Treasury to file a report to the Congress detailing whether and how tax code incentives received by all utilities should be reviewed in order to foster a competitive retail electricity market in the future. Furthermore, I am pleased that Senator Murkowski, Chairman of the Senate Energy and Natural Resources Committee, requested a report by the Joint Committee on Taxation to review all subsidies and incentives that investor-owned, publicly-owned and cooperatively-owned utilities receive. Mr. President, I believe EURECA is a common-sense approach that attempts to build consensus to solve some of the critical questions associated with this important issue. The states are moving and should continue to have the ability to craft electricity restructuring plans that recognize the uniqueness of each state. This legislation is the best solution to foster the debate and allow us to move forward with a better product for all classes of consumers and the industry as a whole.

Mr. THOMAS

Mr. THOMAS. Mr. President, I rise today to introduce the Electric Utility Restructuring Empowerment and Competitiveness Act of 1997. This legislation, which gives states the authority to order the delivery of electric energy to all retail consumers, is based on the idea that less government intervention is the best way to achieve affordable, reliable and competitive options for retail electric energy services. This is a substantially different approach from other measures that have been introduced in both the House and Senate to restructure the nation's electric utility industry. I do not believe that a federal mandate on the states requiring retail competition by a date certain is in the best interest of all classes of customers. I am concerned that this method could result in increased electricity rates for low-density states or states that have relatively low-cost power. Electricity is an essential commodity critical to everyday life in this country. It is also an industry heavily regulated at the Federal and State levels. If the Congress is going to make fundamental changes to the last major regulated monopoly, its role should be to help implement competitive changes in a positive manner, rather than interject the heavy hand of government with a ``Washington-knows-best'' mentality. This legislation comes down on the side of States' rights. Having been involved in the electric power industry, I understand the unique characteristics of each State. As most everyone knows, California was the first State to pass a retail choice law. Since that time, Arizona, Massachusetts, New Jersey, Pennsylvania, New Hampshire, Texas, Montana, Oklahoma and others have followed suit. According to Bruce Ellsworth, President of the National Association of Regulatory Utility Commissioners [NARUC], ``more than one-third of the Nation's population live in states that have chosen within the last year to move to open-access, customer choice markets.'' All told, every state except one is in the process of either examining or implementing policies for retail consumers of electric energy. States are clearly taking the lead--they should continue to have that role--and this bill confirms their authority by affirming States' ability to implement retail choice policies. This initiative leaves important functions, including the ability to recover stranded costs, establish and enforce reliability standards, promote renewable energy resources and support public benefit and assistance to low-income and rural consumer programs in the hands of State Public Service Commissions [PUC's]. If a State desires to impose a funding mechanism--such as wires charges--to encourage that a certain percentage of energy production comes from renewable alternatives, they should have that opportunity. However, I do not believe a nationally mandated set-aside is the best way to promote competition. Likewise, individual states would have the authority over retail transactions. This ensures that certain customers could not bypass their local distribution system and avoid responsibility for paying their share of stranded costs. One of the most important aspects of this debate--assuring that universal service is maintained--is a critical function that each State PUC should have the ability to oversee and enforce. In my legislation, nothing would prohibit a state from requiring all electricity providers that sell electricity to retail customers in that state to provide electricity service to all classes and consumers of electric power. Mr. President, at the wholesale level, my proposal attempts to create greater competition by prospectively exempting the sale of electricity for resale from rates determined by the Federal Energy Regulatory Commission [FERC]. Although everyone talks about ``deregulating'' the electricity industry, it is really the generation segment that will be deregulated. The FERC will continue to regulate transmission in interstate commerce, and State PUC's will continue to regulate retail distribution services and sales. When FERC issued Order 888 last year, it allowed utilities to seek market-based rates for new generating capacity. This provision goes a step further and allows utilities to purchase wholesale power from existing generating facilities, after the date of enactment of this Act, at prices solely determined by market forces. Furthermore, the measure expands FERC authority to require non-public utilities that own, operate or control transmission to open their systems. Currently, the Commission cannot require the Federal Power Marketing Administrations [PMA's], the Tennessee Valley Authority [TVA], municipalities and cooperatives that own transmission, to provide wholesale open access transmission service. According to Elizabeth Moler, Chairwoman of FERC, approximately 22 percent of all transmission is beyond open access authority. Requiring these non- public utilities to provide this service will help ensure that a true wholesale power market exists. One of the key elements of this measure is streamlining and modernizing the Public Utility Regulatory Policies Act of 1978 [PURPA] and the Public Utility Holding Company Act of 1935 [PUHCA]. While both of these initiatives were enacted with good intentions, and their obligations fulfilled, there is widespread consensus that the Acts have outlived their usefulness. My bill amends section 210 of PURPA on a prospective basis. Current PURPA contracts would continue to be honored and upheld. However, upon enactment of this legislation, a utility that begins operating would not be required to enter into a new contract or obligation to purchase electricity under section 210 of PURPA. With regard to PUHCA, I chose to incorporate Senator D'Amato's recently introduced legislation in my bill. As Chairman of the Senate Banking Committee, which has jurisdiction over the issue, he has crafted a proposal that I believe will successfully reform the statute and I support his efforts. Under his proposal, the provisions of PUHCA would be repealed 18 months after the Act is signed into law. Furthermore, all books and records of each holding company and each associate company would be transferred from the Securities and Exchange Commission [SEC]--which currently has jurisdiction over the 15 registered holding companies--to the FERC. This allows energy regulators, who truly know the industry, to oversee the operations of these companies and review acquisitions and mergers. These consumer protections are an important part of PUHCA reform. Mr. President, an issue which must be resolved in order for a true competitive environment to exist is that of utilities receiving special ``subsidies'' by the federal government and the U.S. tax code. For years, investor-owned utilities [IOU's] have claimed inequity because of tax-exempt financing and low-interest loans that municipalities and rural cooperatives receive. On the other side of the equation, these public power systems maintain that IOU's are able to receive special tax treatment, not offered to them, which amounts to a ``tax free'' loan. The jury is still out on how best to deal with this thorny and, undoubtedly complex matter, but make no mistake about it, changes will be made. A viable option the Congress should consider is to ``build a fence'' around governmental utilities. Sales in existing service territories could continue to be financed using current methods. However, for sales outside of their traditional boundaries, these systems should operate on the same basis and play by the same rules as other competitors. The Congress should also address existing tax structures to determine if the ``benefits'' tax-paying utilities receive results in unfair advantages against their competitors. While tax initiatives, such as accelerated depreciation and investment tax credits, are available to all businesses that pay income tax, if this amounts to ``subsidies'' reforms may have to be made. My bill would direct the Inspector General of the Department of Treasury to file a report to the Congress detailing whether and how tax code incentives received by all utilities should be reviewed in order to foster a competitive retail electricity market in the future. Furthermore, I am pleased that Senator Murkowski, Chairman of the Senate Energy and Natural Resources Committee, requested a report by the Joint Committee on Taxation to review all subsidies and incentives that investor-owned, publicly-owned and cooperatively-owned utilities receive. Mr. President, I believe EURECA is a common-sense approach that attempts to build consensus to solve some of the critical questions associated with this important issue. The states are moving and should continue to have the ability to craft electricity restructuring plans that recognize the uniqueness of each state. This legislation is the best solution to foster the debate and allow us to move forward with a better product for all classes of consumers and the industry as a whole.

Mr. THOMAS

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

Mr. THOMAS. Mr. President, I ask unanimous consent that I have permission to speak for approximately 5 minutes.

Mr. THOMAS. Thank you, Mr. President.

Mr. THOMAS

Mr. THOMAS. In 1954, the House of Representatives passed a bill numbered H.R. 9835, legislation to require the executive branch to increase its reliance on the private sector--1954. Among the concerns addressed by the bill were manufacturing, construction and service activities of the Federal Government. Final action on the bill was dropped only upon assurance from the Executive Branch that it would implement the policy administratively. Bureau of the Budget Bulletin 55-4 was issued in 1955, prohibiting agencies from carrying on any commercial activities which could be provided by the private sector. Unfortunately, today we face exactly the same problems Congress faced in 1954. The Federal Government continues not only to compete with the private sector by providing its own goods and services but it also competes with the private sector to provide those goods and services for some other unit of Government or to other private sector entities. Of course, that unfair competition kills private-sector jobs, stifles the economy, erodes the tax base, and hurts small business. One of the top issues the last several times the small business community has held their White House conference--in 1980, 1986, and 1994--was provision for an opportunity to fairly compete. To do that, of course, you have to have a process which takes into account all of the costs for the Federal Government and the private sector and consider other issues like past performance in order to have a fair comparison. It also means over time an agency, if it were going to do a lot of contracting, would change its structure. Instead of being designed to perform these functions and contract out, you would pare the agency down to where its real expertise would be in oversight and supervision of functions that were to be done. The bill that we have introduced, which I would like to encourage my fellow Senators to consider, codifies the policy that the Government should rely on the private sector for its commercial needs. There are exceptions, of course--inherently governmental functions and exemptions for national security concerns. In addition, the Federal Government, if it can provide a better value to the taxpayer, should do it. But if the private sector can provide a better value to American taxpayers, it should have a chance to do it. It also provides for OMB to examine these issues and establishes an office of commercial activities within OMB to implement the bill. Mr. President, I hope that we do consider some of these kinds of changes. The climate is right for action. Congressman Duncan, with whom the Senator from Kansas and I both served in the House, has introduced a companion bill. The Senate is already on record in support of this bill. Last year, the Senate voted 59 to 39 in favor of an amendment to the Treasury, Postal appropriations bill that would have prevented unfair Government competition. Unfortunately, it was dropped from the omnibus appropriations bill. It should be a high priority. We ought to be doing some of these things that create fundamental change in the Federal Government. We are going to seek to balance the budget. We will see in the future the benefit of setting those kinds of priorities. If we could save $30 billion annually through this concept, that is a sizable amount of savings which could be transferred to something else or help balance the budget. In summary, let me say again I think it is a shame we simply go on year after year talking about the same agenda over time, the same kind of Government operation, without taking a look at some of the ways it could be changed. The private sector operates differently, it has to evolve over time. If it does not change, it bows out; it goes out of business. So there is a compelling reason to make the changes. The Government by its nature--and there is nothing wrong with the people; it is the nature of the beast--does not change unless there are changes forced upon it, and, frankly, programs are developed and they have an advocacy in the country and they just do not change. I think that is our responsibility. It is our responsibility to evaluate the effectiveness, to evaluate not only what is done or how many dollars are spent but results. We are in the process now of implementing a result-oriented law that was passed a couple of years ago, and by this spring each agency is to have a fundamental, systemic plan that measures results. My bill is consistent with that effort. Mr. President, I urge my fellow Members of the Senate to consider some fundamental changes in the Federal Government which would allow for many of our small businesses to meet its commercial needs and provide a better value to American taxpayers than they are currently getting. Mr. President, I yield the floor and suggest the absence of a quorum.

Mr. THOMAS. Mr. President, I come to the floor this morning to talk about one of my top priorities for the 105th Congress. That is the Freedom From Government Competition Act. I am struck by the fact that we are considering now the supplemental appropriations bill and debate on it will last, I am sure, all week. Then next week we will consider the budget which will take at least another week of debate. During these deliberations, we will talk about funding the essentials of Government which, of course, is one of Congress' most important tasks. But, unfortunately, it seems to me that we spend an awful lot of time on the budget and on appropriations and funding the Government in the form it is currently in, and less time than we should talking about the changes that we ought to make in the Government. So, while I am on the floor today, I want to mention a couple of bills I have sponsored to change the role of the Federal Government. One is the biennial budget. I think we really ought to consider going to a biennial budget in this Congress as we do in many States so that we can deal with the budget once every 2 years. Agencies would do a better job with 2 years of funding because they would have some stability in their funding levels. Certainly we can look at least 2 years ahead in terms of budget, so that Congress has a whole year to talk about some of the reforms that ought to take place; that ought to change in Government. I am persuaded that without some overt changes, without fundamental changes brought about by the Congress, that Government just continues to go on, just continues to grow, just continues to expand. It is the nature of government. Quite frankly, according to one of the studies by GAO regarding one agency that I just read this weekend, there is no real accountability in terms of spending. So that accountability in terms of what you do with the money and the results that you have in the Government agencies are largely the responsibilities of the Congress. Congress does not have time to do that. We spend too much of our time with the budget, too much of our time with appropriations. One of the other things that we ought to do, in my opinion, is to ensure that the Government is not competing with the private sector in areas that are basically commercial in nature that could better be done and could more cheaply be done through outsourcing. My legislation, the Freedom From Government Competition Act, has the potential to open up a $30 billion market for our Nation's businesses, mostly small businesses, to have an opportunity, by contract, to fulfill the commercial needs of the Federal Government. It would level the playing field for thousands of our Nation's businesses that span the economic spectrum of this whole country, from mundane things to very high tech things, from janitorial services, hospitality and recreation services, to engineering services, laboratories and testing services--those functions that are commercial in nature that are now done by the Government that could better and likely more inexpensively be done in the private sector. The bill is quite simple, as a matter of fact. It simply says that OMB would take a look at all the activities and functions of Government, would identify those that are commercial in nature, and then create a fair and competitive process to outsource those activities to the private sector. Of course, not only does the bill answer the call of the American people to limit the size of Government and encourage the private sector--but it has a great deal of value in terms of the Federal budget. The taxpayers could save many billions of dollars. The interesting part of this concept is that it has been around for a very long time. For over 40 years we have been dealing with this issue. It has been the Federal Government's policy to contract out for over 40 years. Unfortunately, it has not worked. The evidence is that it has not worked. In fact, I recently ran across an excerpt of a 1954 Congressional Quarterly Almanac that details how the current policy came into existence. Mr. President, I ask unanimous consent that this article be printed in the Record.