To support the health needs of our veterans and military personnel and reduce the deficit by making tax rates fairer for all Americans.

SA 2735. Mr. DODD (for himself, Mr. Kennedy, Mr. Kerry, Mr.
Lautenberg, Mrs. Boxer, Ms. Mikulski, Mr. Akaka, Mr. Reed, and Mr.
Salazar) proposed an amendment to amendment SA 2707 proposed by Mr.
Frist (for Mr. Grassley (for himself and Mr. Baucus)) to the bill H.R.
4297, to provide for reconciliation pursuant to section 201(b) of the
concurrent resolution on the budget for fiscal year 2006; as follows:

At the appropriate place, insert the following:

SEC. __. FUNDING FOR VETERANS HEALTH CARE AND DISABILITY
COMPENSATION AND HOSPITAL INFRASTRUCTURE FOR
VETERANS.

(a) Funding for Medical Services.--
(1) Authorization of appropriations.--There is hereby
authorized to be appropriated for the Department of Veterans
Affairs for the Veterans Health Administration for Medical
Care amounts as follows:
(A) $900,000,000 for fiscal year 2006.
(B) $1,300,000,000 for fiscal year 2007.
(C) $1,500,000,000 for fiscal year 2008.
(D) $1,600,000,000 for fiscal year 2009.
(E) $1,600,000,000 for fiscal year 2010.
(2) Supplement not supplant.--The amounts authorized to be
appropriated by this subsection are in addition to any other
amounts authorized to be appropriated for the Veterans Health
Administration for Medical Care under any other provisions of
law.
(b) Funding for Disability Compensation Benefits.--
(1) Authorization of appropriations.--There is hereby
authorized to be appropriated for the Department of Veterans
Affairs for the Veterans Benefits Administration for
Compensation and Pensions amounts as follows:
(A) $2,300,000,000 for fiscal year 2006.
(B) $2,700,000,000 for fiscal year 2007.
(C) $3,000,000,000 for fiscal year 2008.
(D) $3,000,000,000 for fiscal year 2009.
(E) $3,000,000,000 for fiscal year 2010.
(2) Supplement not supplant.--The amounts authorized to be
appropriated by this subsection are in addition to any other
amounts authorized to be appropriated for the Veterans
Benefits Administration for Compensation and Pensions under
any other provisions of law.
(c) Funding for Infrastructure Improvements for Hospitals
Providing Health Care and Services to Veterans.--
(1) Establishment of fund.--There is hereby established on
the books of the Treasury an account to be known as the
``Veterans Hospital Improvement Fund'' (in this subsection
referred to as the ``Fund'').
(2) Elements.--The Fund shall consist of the following:
(A) $1,000,000,000, which shall be deposited in the Fund
upon the enactment of this subsection.
(B) Any other amounts authorized for transfer to or deposit
in the Fund by law.
(3) Administration.--The Funds shall be administered by the
Secretary of Veterans Affairs.
(4) Use of funds.--
(A) In general.--Amounts in the Fund shall be available
expenditures for improvements of health facilities treating
veterans, including military medical treatment facilities,
medical centers and other facilities administered by the
Secretary of Veterans Affairs for the provision of medical
care and services to veterans, and other State, local, and
private facilities providing medical care and services to
veterans.
(B) Application for funds.--A non-Federal health facility
seeking amounts from the Fund shall submit to the Secretary
of Veterans Affairs an application therefor setting forth
such information as the Secretary shall require.
(C) Availability.--Amounts in the Fund shall remain
available until expended.
(d) Offset Through Modification of Tax Rates on Capital
Gains and Dividends for Individuals With $1,000,000 or More
of Taxable Income.--
(1) In general.--Section 1(h) is amended by adding at the
end the following new paragraph:
``(12) Modified rates for individuals with $1,000,000 or
more of taxable income.--If a taxpayer has taxable income of
$1,000,000 or more for any taxable year--
``(A) paragraph (11) (relating to dividends taxed as
capital gain) shall not apply to any qualified dividend
income of the taxpayer for the taxable year, and
``(B) paragraph (1)(C) shall be applied by substituting `20
percent' for `15 percent' with respect to the adjusted net
capital gain of the taxpayer for the taxable year, determined
by only taking into account gain or loss properly allocable
to the portion of the taxable year after December 31, 2006.''
(2) Application to minimum tax.--Section 55(b)(3) is
amended by adding at the end the following new sentence: ``In
the case of a taxpayer with alternative minimum taxable
income of $1,000,000 or more for any taxable year, the rules
of section 1(h)(12) shall apply for purposes of this
paragraph.''
(3) Effective dates.--
(A) Capital gains.--Section 1(h)(12)(B) of the Internal
Revenue Code of 1986 (as added by paragraph (1)) shall apply
to taxable years beginning after December 31, 2006.
(B) Dividend rates.--Section 1(h)(12)(A) of such Code (as
added by paragraph (1)) shall

[[Page S681]]

apply to dividends received after December 31, 2006.
(4) Application of jgtrra sunset.--The amendments made by
this subsection shall be subject to section 303 of the Jobs
and Growth Tax Relief Reconciliation Act of 2003 to the same
extent and in the same manner as the provision of such Act to
which such amendment relates.
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