A bill to amend the Internal Revenue Code of 1986 to exclude from gross income certain hazard mitigation assistance.

Mr. President, I rise today to introduce legislation concerning a critical issue this year--disaster assistance. This has been one of the worst hurricane seasons that Florida has seen in recent years. The Sunshine State has been battered by four hurricanes in the past six weeks. I extend my deepest sympathies to the residents of Florida where some have had to evacuate more than three times during this hurricane season only to return home and find their homes leveled, their crops uprooted, their neighborhoods flooded, and their dreams shattered.

In my home State of Missouri, we are no strangers to natural disasters. Located smack in the middle of Tornado Alley, Missouri has been hit by some of the largest storms in U.S. in history. In May of 2003, a string of tornadoes ripped through the western part of the State causing major damage and devastation.

With two rivers--the Mississippi and the Missouri--we have also seen our fair share of flooding through the years. I will never forget when the Mississippi River breached its banks in 1993--one of the most devastating floods in U.S. history. Of the nine Midwestern States affected, the State of Missouri was the hardest hit and State officials estimate that damages totaled $3 billion.

While both the Mississippi and Missouri Rivers have made the State of Missouri susceptible to riverine flooding, the State is also susceptible to flash flooding. A case in point is the city of Union, located about 45 minutes from St. Louis, which suffered tremendous damage from a severe flash flood in May of 2000.

I mention the city of Union as a specific example of the benefits that a disaster mitigation program can hold in flash-flood situations. After the flood, the City of Union applied to the State of Missouri Emergency Management Agency to seek help in a demolition and acquisition project. With the mitigation grant money, 17 properties were acquired in residential areas with substantial damage. These properties are now dead restricted for ``open space,'' which will prevent future development and the potential for flash flood related deaths in that area because many of the homes and people will no longer be in harm's way. This is an excellent example of the value of disaster and mitigation money invested by the federal, state and local governments.

Over the years, the State of Missouri has worked with the Federal Emergency Management Agency (FEMA) to build structures that prevent flooding and other damage from occurring when natural disasters strike. Time and time again, FEMA has come to the rescue by establishing funding for disaster relief and mitigation activities within the State of Missouri and in other States across the country.

Having served as the Chairman of the Senate Appropriations Subcommittee on VA, HUD, and Independent Agencies, which until recently oversaw FEMA, I know first hand the value of the agency's disaster mitigation grant programs--the Hazards Mitigation Grant Program (HGMP), the Pre-Disaster Mitigation program (PDM), and the Flood Mitigation Assistance (FMA) program. Designed to manage future emergencies, these programs have been essential to countless communities, and without them, thousands of lives would be in jeopardy.

Recently, some very disturbing news was brought to my attention. According to a June 2004 legal memorandum issued by the Internal Revenue Service (IRS), FEMA mitigation grants may be subject to income taxation. While some may argue that this is merely the IRS's interpretation of the statute, it is clearly the position the IRS intends to take against American taxpayers whose only recourse will be to fight the agency in court.

I must say that I am absolutely stunned by this determination by the IRS!! How in the world could the IRS possibly think that Congress intended to tax these types of grants to prevent natural disasters, especially when we went out of our way to ensure that disaster-relief payments to individuals recovering from a hurricane, flood, tornado or other natural disaster are not subject to income taxes?

Today, I am offering a bill that will stop the IRS in its tracks and prevent the taxation of disaster mitigation grants. This language will ensure that any Federal grants, as well as state grants indirectly associated with this program, will not be deemed to be income by the IRS's tortured reasoning. This bill will be effective as of the beginning of this year to ensure that any grants currently out there, especially in light of the current hurricanes that have happened, are not subject to tax. In addition, there should be no inference by this legislation that Congress intended such grants to be taxable prior to the effective date of this legislation.

Why is this important? Why am I out here today? Because the Missouri and Mississippi Rivers rise, because tornadoes will ravage through the state once again, and because flash flooding can decimate an entire community. The last thing Americans who are working to prevent such potential destruction need is for government-grant funding to be subject to tax. My bill ensures that such taxes do not see the light of day.

I urge my colleagues to support this important legislation, and I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I rise today to introduce legislation concerning a critical issue this year--disaster assistance. This has been one of the worst hurricane seasons that Florida has seen in recent years. The Sunshine State has been battered by four hurricanes in the past six weeks. I extend my deepest sympathies to the residents of Florida where some have had to evacuate more than three times during this hurricane season only to return home and find their homes leveled, their crops uprooted, their neighborhoods flooded, and their dreams shattered.

In my home State of Missouri, we are no strangers to natural disasters. Located smack in the middle of Tornado Alley, Missouri has been hit by some of the largest storms in U.S. in history. In May of 2003, a string of tornadoes ripped through the western part of the State causing major damage and devastation.

With two rivers--the Mississippi and the Missouri--we have also seen our fair share of flooding through the years. I will never forget when the Mississippi River breached its banks in 1993--one of the most devastating floods in U.S. history. Of the nine Midwestern States affected, the State of Missouri was the hardest hit and State officials estimate that damages totaled $3 billion.

While both the Mississippi and Missouri Rivers have made the State of Missouri susceptible to riverine flooding, the State is also susceptible to flash flooding. A case in point is the city of Union, located about 45 minutes from St. Louis, which suffered tremendous damage from a severe flash flood in May of 2000.

I mention the city of Union as a specific example of the benefits that a disaster mitigation program can hold in flash-flood situations. After the flood, the City of Union applied to the State of Missouri Emergency Management Agency to seek help in a demolition and acquisition project. With the mitigation grant money, 17 properties were acquired in residential areas with substantial damage. These properties are now dead restricted for ``open space,'' which will prevent future development and the potential for flash flood related deaths in that area because many of the homes and people will no longer be in harm's way. This is an excellent example of the value of disaster and mitigation money invested by the federal, state and local governments.

Over the years, the State of Missouri has worked with the Federal Emergency Management Agency (FEMA) to build structures that prevent flooding and other damage from occurring when natural disasters strike. Time and time again, FEMA has come to the rescue by establishing funding for disaster relief and mitigation activities within the State of Missouri and in other States across the country.

Having served as the Chairman of the Senate Appropriations Subcommittee on VA, HUD, and Independent Agencies, which until recently oversaw FEMA, I know first hand the value of the agency's disaster mitigation grant programs--the Hazards Mitigation Grant Program (HGMP), the Pre-Disaster Mitigation program (PDM), and the Flood Mitigation Assistance (FMA) program. Designed to manage future emergencies, these programs have been essential to countless communities, and without them, thousands of lives would be in jeopardy.

Recently, some very disturbing news was brought to my attention. According to a June 2004 legal memorandum issued by the Internal Revenue Service (IRS), FEMA mitigation grants may be subject to income taxation. While some may argue that this is merely the IRS's interpretation of the statute, it is clearly the position the IRS intends to take against American taxpayers whose only recourse will be to fight the agency in court.

I must say that I am absolutely stunned by this determination by the IRS!! How in the world could the IRS possibly think that Congress intended to tax these types of grants to prevent natural disasters, especially when we went out of our way to ensure that disaster-relief payments to individuals recovering from a hurricane, flood, tornado or other natural disaster are not subject to income taxes?

Today, I am offering a bill that will stop the IRS in its tracks and prevent the taxation of disaster mitigation grants. This language will ensure that any Federal grants, as well as state grants indirectly associated with this program, will not be deemed to be income by the IRS's tortured reasoning. This bill will be effective as of the beginning of this year to ensure that any grants currently out there, especially in light of the current hurricanes that have happened, are not subject to tax. In addition, there should be no inference by this legislation that Congress intended such grants to be taxable prior to the effective date of this legislation.

Why is this important? Why am I out here today? Because the Missouri and Mississippi Rivers rise, because tornadoes will ravage through the state once again, and because flash flooding can decimate an entire community. The last thing Americans who are working to prevent such potential destruction need is for government-grant funding to be subject to tax. My bill ensures that such taxes do not see the light of day.

I urge my colleagues to support this important legislation, and I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, I rise to introduce the ``Community College Opportunity Act.'' Community colleges are the gateway to the future for first time students looking for an affordable college education, and for mid-career students looking to get ahead in the workplace. As college tuition at four-year colleges continues to rise, more and more students are turning to community colleges for the education they need to prepare for 21st century jobs.

Yet soon we may not be able to count on our community colleges being available to everyone. The combination of budget cuts and increased enrollments is forcing community colleges to make tough choices between raising tuition and turning students away. This important legislation will help keep the doors of our community colleges open to increasing numbers of students without sending tuition through the roof. My bill authorizes $100 million for a competitive grant program to help community colleges serve more students. Community colleges could apply for a grant to help with the cost of constructing or renovating facilities, hiring faculty, purchasing new computers and scientific equipment, and investing in creative ways of addressing overcrowding-- like distance learning.

Why is this important? Community colleges are one of the great American social inventions. I used to teach night school at Baltimore City Community College. I know firsthand the vital role they play in our communities. Their low cost, convenient location, and open door admissions policy have made them the key to the American dream for so many. Many generations of immigrants pursued the American dream by working all day and going to school at night. After World War II, the GI bill gave returning veterans a chance to get ahead by going to local junior colleges.

Now, more than ever, it's important to invest in community colleges. In the next ten years, 40 percent of new jobs will require college education. At the same time, college tuition is on the rise. Tuition at the University of Maryland is up by as much as 21 percent. That's causing many students to take a second look at community colleges because they're more affordable. They're also leaders in training workers for 21st century jobs from nurses to computer techies, and even lab techs for new industries, like biotechnology. They're playing a key role in addressing shortages in nursing and teaching. In Maryland, community colleges train 55 percent of new nurses.

Yet our community colleges are bursting at the seams. They're growing faster than 4-year colleges. Enrollment at Maryland's community colleges is expected to grow 30 percent in the next 10 years, while 4- year colleges will grow by 15 percent. Community colleges are holding classes from 7 in the morning to 10 at night, on weekends, and over the internet. In my own state of Maryland, they are starting to turn students away because there isn't enough room. As many as 2000 students were shut out of Montgomery College last year because they couldn't get into the classes they needed or they couldn't afford the cost. Last fall, Prince George's Community College had to turn away 630 prospective nursing students and 1,000 prospective education students.

It's great that so many Americans are going to community colleges. For so many Americans, community colleges are the only way to get the education they need to be competitive for 21st century jobs. Yet the rapid increase of students is threatening the very mission of community colleges. If we want a world-class workforce, we need to invest in higher education. We need to make sure we have always institutions available to everyone who wants a college degree or just a couple of courses. That means investing in our community colleges, so they can continue to be affordable, accessible, and successful at training the next generation of nurses, teachers, and techies.

I ask unanimous consent that the text of the bill be printed in the Record.

Mr. President, in these final days of the 108th Congress, I would like to call attention to an issue of great consequence to the people of Florida and to other States that recently have been victimized by natural disasters.

This year, four hurricanes wrought a path of damage and destruction across Florida and other areas. The U.S. Congress was quick to provide Federal relief for victims of the storms, and we are grateful for this. Yet a June Internal Revenue Service ruling determines that this assistance ought to be taxed.

This means that if a homeowner accepts a $25,000 Federal grant to elevate their flood prone home, the grant would be included in their taxable income. This unexpected tax liability could be financially devastating to a retiree living on a fixed income after already having faced the costs of hurricane cleanup. It also creates a strong disincentive for homeowners to participate in Federal mitigation programs,

increasing the risk of damage and expense in future disasters. The IRS policy runs counter to good public policy and common sense.

Senator Kit Bond and Representative Mark Foley have introduced S. 2886 and H.R. 5206, respectively, identical bills that would fix this problem by exempting mitigation grants from being included as taxable income. These bills have drawn support from both sides of the aisle and a large number of the Florida Congressional delegation. I am disappointed that we will not have an opportunity to pass these bills before Congress adjourns. If we fail to act early on in the 109th Congress, come April, some homeowners could be in for a rude awakening in the form of a higher tax bill from the IRS.

To help ease the minds of Floridians and other Americans living in disaster prone areas of the country, I joined Senator Landrieu in sending a letter to Finance Committee Chairman Grassley and Ranking Member Baucus asking them to direct the Treasury and the IRS to delay implementing this policy until Congress has the opportunity to act.

I will continue to work with my colleagues in the Senate to find a solution to this problem.