Good Samaritan Hunger Relief Tax Incentive Act

Madam President, I think it is important at the outset to know we are including in the CARE bill incentives to help provide charitable contributions for good voluntary purposes, and I think this bill should continue to honor that thrust. The amendment before us does not. The amendment before us essentially is a capital gains tax amendment and applies generally to all property that would be sold. I think this is not the place for that kind of amendment.

The underlying provisions of the bill provide that taxpayers who voluntarily sell land to a qualified conservation organization can exclude 25 percent of the gain on that sale from capital gains tax. The purpose, obviously, is to help people, most of whom are land rich and cash poor and do not have much income from their ranching or farm operations--to help by transferring the property to a conservation organization.

There are many organizations in this country--a lot in my State of Montana--such as the Nature Conservancy, lots of very good, solid organizations which take land and save it for conservation purposes. This is very important because our country is losing a lot of land to development each day, each year. In fact, in the United States about 2 acres of farmland per minute, or about 1 million per year, are lost to development; that is, shopping centers and new homes or what-not that are just taking away some of the natural land that we have in our country and converting it at a very rapid rate to shopping centers and developments.

That is part of America. We need to build shopping centers. We need to also build new homes, housing tracts, and so forth. But we also need to remember there are other values in our country, and those are protecting open space and protecting farms and ranches. A lot of our farms and ranches are under great stress. I know the Presiding Officer knows that is true in her home State as is the case in every State.

We are trying to figure out a balanced way to help those farmers and ranchers donate a portion of their land to a conservation organization. They cannot do that today because they have no income. Because they have no income, they can't take the usual charitable deduction. To help them, we are saying you don't have to worry about the charitable deduction; you can still

get a little bit of benefit because we will exclude 25 percent of the gain. It is extremely important.

I might point out, this is actually a little less generous than provisions suggested by the President. The President, in his budget, suggested an appreciably larger exclusion for this very purpose.

The amendment before us, though, is not geared at all toward conservation. Essentially, it provides the same benefit, a 25-percent exclusion that would be available to anyone who sells property for any purpose. It does not have to be conservation. It would be pretty expensive, I might add, too--about a $1.4 billion additional cost to the Treasury.

I understand the concerns the Senator has, but this is just not the time or place for capital gains tax reform. This is, rather, a CARE bill, a bill that is encouraging conservation, encouraging charitable giving. I urge my colleagues to not accept the amendment because I do not think it is properly placed in this bill.

I reserve my time.

Madam President, I believe the Senator from Connecticut would like the floor. I yield to him such time as he wishes to consume.

Madam President, the CARE Act is an important piece of legislation that will help those organizations that are always there to help us. On balance, I believe the bill will encourage more charitable giving. And this is particularly important now, when demand on these organizations is out-pacing resources.

This legislation would not have been possible without the contributions of many.

First, I would like to thank the Finance Committee staff for their expert counsel and hard work. They spent many long hours perfecting this legislation. They are role models for those in public service.

I appreciate the cooperation we received from the Republican staff members including Kolan Davis, Mark Prater, Dean Zerbe, Elizabeth Paris, Christy Mistr, and Ed McClellan.

I want to especially thank my staff, including Jeff Forbes, John Angell, Russ Sullivan, Patrick Heck, and Jonathan Selib. I also want to mention our hardworking interns, Shawn White and Tyler Garrett.

The Finance Committee staff worked closely with staff members from other Senate offices. They also were in touch with officials from the Administration, including Susan Brown and others from Treasury.

The Joint Committee on Taxation provided technical assistance. Lindy Paull, Mary Schmitt, Roger Colinvaux, Ron Schultz, Sam Olchyk, Ray Beeman, and Brian Meighan. And many others. We owe many thanks for the assistance they provided.

Second, I want to thank Senators Lieberman and Santorum. The CARE Act has been a priority for them for a long time. They have worked tirelessly to get this bill before the Senate. We are grateful for their diligence, cooperation and input.

I also want to thank our leaders Senators Frist and Daschle for their decision in moving the CARE Act forward.

I want to thank my good friend and colleague, Chairman Grassley. As always, he has been instrumental in ensuring a truly bipartisan bill. And, it continues to be a pleasure to work with him.

Finally, I look forward to seeing this bill passed into law--and soon. It is my hope that the House will take up this legislation quickly.

The CARE Act is one of the President's top priorities. There is a lot in this bill that enjoys widespread, bipartisan support.

Together, we have been working on this bill for more than 2 years. There is no need for further delay.

I urge the House to act quickly on this legislation so that we can have the CARE Act on the President's desk by the Memorial Day recess.

This is a good bill. I urge my colleagues to vote for the CARE Act.

Madam President, the CARE Act takes bold steps to combat the devastating problem of hunger--an issue that affects far too many of my constituents in Montana.

Today, in the greatest and most prosperous nation in the world, hunger remains a real problem for our families.

According to the USDA, more than 1 in 8 households were food insecure in Montana between 1999 and 2001. This means that they do not consistently know where their next meal will come from.

And 4 percent of households in Montana--that is 32,000 people, 12,000 of whom are children--live in conditions so severe that they are classified as actually experiencing hunger.

These numbers are on the rise--Montana's hunger rate had the second highest jump of any state from an identical USDA study done just three years earlier.

Many of these are working poor families, making gut-wrenching decisions

between whether to spend their hard-earned money on housing, healthcare, child-care, or food.

So this is an issue that concerns me deeply.

The CARE Act will provide a valuable weapon in the war to end hunger. It will do so by making it easier for farmers and small businesses to donate surplus food to our struggling hunger relief charities.

Simply put, these difficult economic times mean that more people are showing up to food pantries and soup kitchens at a time when these organizations are struggling the most to meet demand.

These community groups--usually consisting solely of volunteers--are often ``first-responders'' in the battle against hunger.

The CARE Act will help food pantries and soup kitchens to keep food on the shelves for hungry families.

The CARE Act is also good for America's struggling farmers and businesses. It helps them do the right thing by donating surplus food that would otherwise have been thrown away.

Here is what Peggy Grimes, of the Montana Food Bank Network has to say about the CARE Act:

It has come to my attention that these struggling farmers

and small grocers do not receive any tax benefit for their

increasing donations. They have been donating out of concern

for their neighbors as they have been hearing reports of

increased food insecurity throughout Montana. . . . For

Montana, as an agricultural state, the Care Act will be of

significant benefit to both those donating food and those in

need of food.

Hunger in America is not a problem of lack of food. The USDA estimates that 96 billion pounds of food are thrown away each year.

This is simply shameful when working families are struggling to make ends meet. There is a problem when it is more profitable to throw away food than it is to donate it to those who need it.

The CARE Act helps solve this problem by providing incentives to farmers and small businesses, whose resources are also constrained in these economic times.

America's Second Harvest, the nation's largest anti-hunger charity, estimates that the CARE Act will result in enough donated food to provide roughly 765 million meals over the next 10 years.

These results are real, and I am proud to support this provision.

The CARE Act is a win-win-win situation. It is a win for anti-hunger charities that work hard to ensure that America's families have food on the table.

It is a win for our farmers and businesses that want to help their neighbors in need. And most importantly, it is a win for America's low- income families, who will see food on their tables.

I urge my colleagues to support the CARE Act.

Madam President, it is a sad fact that in a large number of homes-- particularly in the homes of our poorest, most at-risk children--you cannot find a book. Sixty percent of kindergartners--in neighborhoods that performed poorly in school--did not own a single book.

The lack of access to books poses the greatest barrier to literacy. That is why we must change the status quo.

Unfortunately, the tax law functions as a disincentive to the charitable donation of books to schools, libraries, and literacy programs. Under the tax law, it is actually more economical to truck books to a dump than it is to give them to your local school or library.

Through the title I program, however, we have nearly 15 million youngsters nationwide enrolled. This allows us to reach at least a portion of the disadvantaged children in our country.

In my State of Montana, there are an estimated 35,000 poor children who qualify for the title I program. These children will also benefit from the provision in the CARE Act which encourages the donation of books. For a child who has never owned a book--their first book is a prized possession.

An increase in charitable book contributions would especially benefit the State of Montana. According to the Montana Library Association, the Montana State Library has fallen victim to a 26 percent budget cut in 2003. These reductions will mean less money for local libraries. And they will mean cuts in the State subsidies that currently fund book purchases, interlibrary loans, and audio and other special books for the elderly, disabled, and sick.

According to the Montana Commissioner of Higher Education, Montana universities will also receive fewer books. In the wake of the latest budget cuts, the state legislature has cut university budgets 8.4 percent. That puts university funding below 1992 levels.

The University of Montana leads the list with a 10.9 percent cut in state money. Followed by Montana State University at a 9.8 percent cut. And MSUY-Billings at a 8.5 percent cut. The libraries at Montana universities will experience cuts of $1.6 million for new materials.

These cuts will not only hurt universities--they will also hurt the programs in which university students participate. For example, the Montana Reads literacy program--started by University of Montana President Dennison in 1997.

This program is critical to the 60-plus University of Montana student volunteers who regularly tutor kindergarten through fifth grade Missoula students. I think it is simple common sense that a critical component of any successful literacy program is for the students to have books. These Montana tutors depend on book donations to help their students. The CARE Act helps them to help the elementary kids in Missoula.

Of course these donations will also greatly aid adult literacy. Campaigns such as the Montana Adult Basic & Literacy Education, ABLE, program serve adults who lack sufficient mastery of basic skills to function in society, a high school diploma, or basic English skills. In Montana, 75,000 adults aged 25 and over do not have a high school diploma or a GED. Twenty-five thousand adults have less than a ninth grade education.

Every effort we make to improve reading in Montana will suffer if we do not include books in the equation. The Federal Government granted 36 Montana schools $11 million over 3 years to find reading coaches, family literacy programs and tutors.

These grants are so important to Montana. But if we fail to supply books as part of the equation, then the grants are not put to use in the most efficient way. Allowing charitable donations for books ensures that we use taxpayer dollars more effectively. We cannot afford not to.

Madam President, earlier this year, Senator Grassley and I reintroduced S. 701, the Rural Heritage Conservation Act. This bill will help the nation's hard-working farmers and ranchers preserve their heritage and way-of-life. At the same time, it promotes conservation of valuable open space and wildlife habitat. This legislation is included as a provision in the CARE Act.

S. 701 provides targeted income tax relief to small farmers and ranchers who wish to make a charitable contribution of a qualified conservation easement.

The bill would allow eligible farmers and ranchers to increase the currently deductible amount for charitable contributions of qualified conservation easements. That means that farmers and ranchers can deduct amounts up to 100 percent of adjusted gross income.

The bill also extends the carryover period from 5 years to 15 years. In the case of all other landowners, the AGI limitation would be raised from 30 percent to 50 percent.

Senator Grassley has worked closely with me to include the provisions of S. 701 in the CARE Act. I believe our bipartisan cooperation is the reason why we have come so far in moving this very important piece of legislation.

Passing the provisions in S. 701 will mean that farmers and ranchers facing the potential of having to sell their ranch will have another financially viable option. Under this proposal, they will be able to choose to take advantage of the conservation easement incentives, stay on their land, and invest in their farming or ranching business.

In practical terms, that means these farmers and ranchers do not have to sell the family farm or ranch. They can keep it in the family. This is so important to preserving the character and economic vitality of our rural communities.

Over the past 25 years, over 3 million acres of agricultural lands have been

lost to development in Montana alone. Many of those lands were lost when family farms--hit hard by tough times--were forced to give up their generations' old farming operations and sell to developers in order to pay the bills.

We have to find additional tools to help these folks keep their land in agricultural production and in open space. Our legislation provides one of those tools.

To illustrate why this legislation is so important, let me give you an example of the impact of current law on farmers and ranchers.

Jerry Townsend was born and raised on his family's ranch in Highwood, Montana. He has operated the ranch since purchasing it from his parents in 1974. On his ranch, called the Elk Run Ranch, he raises commercial beef cattle.

In 1995, Mr. Townsend donated a conservation easement to the Montana Land Reliance. His ``donation'' was calculated at $528,000. However, because his ranch is held as a C corporation, his tax deduction was limited to10 percent of the ranch's net income. His tax deduction over the six years totaled a paltry $1,998--less than one percent of the total value of his donation.

In contrast, a landowner with more in income would have a much greater incentive to enter into an easement agreement because he or she would be able to deduct more of the value of the donation from their taxes.

S. 701 would do nothing more than level the playing field for farmers and ranchers when it comes to the tax benefits of donating conservation easements. What should matter is the value of your land--not the amount of your income.

Our conservation easement bill, and as included in the CARE Act, have been endorsed by 210 land trusts representing 44 States. Other supporters include the Montana Stockgrowers, the American Farmland Trust, and the Colorado Cattlemen.

This is a win-win proposition. Farmers and ranchers will be able to preserve their important agricultural and ranching lands for future generations. They will be able to continue to operate their businesses. They will be able to stay on their land.

It is a purely voluntary, incentive-based way to promote conservation. And it will allow us to bring people together. Landowners. Conservationists. The Federal Government. And local communities. All working together to preserve our precious natural resources and agricultural heritage.

Madam President, I rise to talk about another important, but often overlooked, aspect of the CARE Act additional funding for the Social Services Block Grant, or SSBG.

SSBG funds are very flexible. States can use these funds to assist abused children cope with their trauma; to help seniors live at home, instead of nursing homes; to provide day care for children in low- income working families; so that we know those kids are in safe places while their parents work; to assist the disabled so that they can fully participate in our society; to help parents adopt children, so that every child has a loving parent.

In my State of Montana, we use SSBG to help children with developmental disabilities, like those with cerebral palsy.

SSBG is ``glue money.'' Communities use it to fill holes in the safety net. It is up to States and localities to decide where it goes. We give them a long menu of options, and they use it the way they see fit, based on local needs. This bill provides over $1 billion more in SSBG to fill those holes over 2 years.

The goal of the CARE Act is to increase compassionate activity in our country. We are a big-hearted country. We want to help each other. This bill will help turn more of that desire into action and will make sure Government is doing its part.

SSBG funds support the activities of faith-related charities. We give the money to the States and they often contract with faith-related organizations to do the hands-on work that they do so well. If you want to support Catholic Charities, then you should support SSBG. If you want to support Lutheran Social Services, then you should support SSBG. These organizations have told me that SSBG funds are crucially important to them.

The CARE Act is about increased individual giving. That is absolutely vital. But if the Government does less, then any increase in individual giving may only be filling that gap left by the withdrawal of the Government.

The additional SSBG funding in this bill is our way of saying that the Government will keep its part of the bargain and continue to play a role. It is a flexible source of funds, so it won't be bureaucrats in Washington dictating the money will be used. And much of the funding will go to faith-related charities--the very organizations we want to bolster.

We haven't talked much about the SSBG provision. That is a good sign. Around here, we tend to talk about the things we disagree about. I am glad we could find common ground on this provision so easily. I'm sure the faith-related charities will thank us for doing so.

I commend Senators Lieberman and Santorum for their work on the CARE Act.

Madam President, on February 5, 2003, the Finance Committee passed tax shelter legislation to offset the cost of the CARE Act.

How appropriate it is for a bill to encourage more charitable giving to be paid for by those shirking their responsibility to pay their fair share of taxes.

The tax shelter legislation included in the CARE Act was developed by the Finance Committee over the past 4 years.

The committee has taken time to develop appropriately targeted legislation. Care has been taken to avoid encumbering legitimate business transactions. Nevertheless, we will all be burdened until we get this problem in check.

Without these changes, honest businesses will continue to be burdened to the extent they compete against companies avoiding taxes.

Tax shelters are carefully engineered tax transactions. Most have little or no economic substance. That means that they are designed to achieve unwarranted tax benefits rather than business profit. And, they place honest taxpayers at a considerable disadvantage.

As Michael Graetz, Professor of Law at Yale University, once said: ``a tax shelter is a deal done by very smart people that, absent tax considerations, would be very stupid.''

It is time to put a stop to the unsavory practice of mining the Tax Code for these abusive shelters.

These transactions are designed to take advantage of the complexity of the tax law to obtain benefits that Congress never intended.

They pose a real threat to the integrity of our self-assessment system by eroding the public's respect of the tax law.

Under tax shelter legislation produced by the Finance Committee, promoters, advisors, and taxpayers would be subject to stiff penalties for failing to acknowledge these transactions to the IRS.

Treasury believes that if a taxpayer feels comfortable entering into a transaction; if a promoter feels comfortable selling a transaction; and, an advisor feels comfortable recommending a transaction, they should all feel comfortable disclosing the transaction to the IRS.

We have worked closely with the Treasury Department in crafting this legislation. We have given Treasury authority to fine-tune the provisions so as to protect legitimate tax planning.

But make no mistake, I am committed to combating abusive tax transactions. The tax shelter package is the first installment. It will not be the last.

The tax shelter package reinforces steps already taken by Treasury by requiring more transparency.

Taxpayers will now be required to disclose certain reportable transactions on their tax returns or face stiff penalties. Promoters will have to provide information to IRS on their tax avoidance strategies or face stiff sanctions.

These provisions are designed to change the cost-benefit ratio of those contemplating engaging in egregious tax planning strategies.

The bill would also eliminate abusive tax shelters by denying tax benefits with little or no economic substance.

That means that taxpayers will have to enter into transactions for legitimate economic and business reasons and not purely for tax avoidance.

This was the key recommendation made by the Joint Committee on Taxation in response to the investigation of Enron's tax transactions.

Presently, there is lack of uniformity regarding the proper application of the economic substance doctrine. Some courts apply a conjunctive test that requires a taxpayer to establish the presence of both economic substance and a substantial nontax business purpose. Other courts have found the existence of one of these as sufficient to respect a transaction.

The provision will clarify the application of the doctrine. It does not tell the court when to apply it.

A tax shelter disallowed in New York should not be permitted elsewhere. The clarification ensures uniformity across the country.

The tax shelter legislation included in the CARE Act is only a down payment. It will go a long way toward curbing abusive transactions. But it is not the final answer.

Based on the Joint Committee's investigation of Enron's tax returns, additional steps are needed. The Joint Committee made several specific recommendations for additional changes. We are looking closely at these recommendations. Additional legislation will be forthcoming. I am confident we will make any additional changes with bipartisan support.

Enron kept the IRS in the dark and out-maneuvered. The lack of adequate disclosure rules and the lack of sufficient IRS enforcement resources clearly helped Enron and its executives walk away with millions maybe billions. Our legislation would bring more transparency to these Enron-type transactions. The Enron report clearly demonstrates the need for meaningful shelter legislation.

I urge my colleagues to support this measure.

Madam President, I thank my friend from Montana.

I rise to speak in favor of the CARE Act, the Charity Aid, Recovery, and Empowerment Act. This began as an attempt to give support to faith- based groups to perform good works.

Congratulating the UConn Women Huskies

If I may use that as a segue for a seemingly unrelated comment, I want to express this morning the pride and exultation of the people of Connecticut whose faith in our UConn Women Huskies was vindicated last night as they achieved an extraordinary victory over a very tough and proud Tennessee team. The UConn Women won another national championship for the UConn Women Huskies, the fourth in the program's history.

My congratulations to Coach Geno Auriemma, Assistant Coach Chris Dailey, and the great UConn women who rebuilt a lot of young talent that came together and made us all proud. They set an extraordinary example for young women all over America who, like my 15-year-old daughter, love basketball, love to play it, and are inspired by the skill and grit and team spirit of the UConn Women Huskies.

So our faith was redeemed, and you give us faith, Lady Huskies, as we go on.

Returning to the CARE Act, I must say that I am proud and, in some senses, relieved to join my colleagues in supporting this act. This act is a compromise version of the initial faith-

based and community initiative. It comes to the Senate floor after a difficult path. But the important point is that we are here.

This is a different plan than the President originally proposed. It is different than the plan that Senator Santorum--who I have been so pleased to work with as lead cosponsor with him--and I negotiated with the White House to address concerns that were blocking its initial movement.

Perhaps most notably, it no longer contains any provisions targeted specifically at carving out a larger lawful space for faith-based groups in our social service programs. But despite this evolution, the heart of the proposal remains the same; and I guess, I would add, the soul of the proposal remains the same as well.

That is why the CARE Act enjoys overwhelming support from America's philanthropic community, with endorsements from more than 1,600 charities of all sizes and denominations, as well, as we can see, strong bipartisan support here in the Senate. And that is why I feel confident this measure will help transform the spirit of good will in America today into more good works at a time of growing hardship and make this country as good as its values are.

Any doubt about the vitality of America's spirit was firmly laid to rest on September 11, 2001, when so many Americans gave so much and all of us collectively embraced the values of compassion and community. But if we truly hope to keep moving America closer to our founding ideals, we have to extend that commitment to helping those who continue to live in a different type of need--children living in poverty and despair; drug addicts desperate for treatment and a better life; low income working families who are struggling for self-sufficiency.

Our Government, of course, runs many programs at the Federal, State, and local levels that aim to fill those needs as best they can by establishing a safety net. But all of us here, regardless of party or geography, recognize that Government can't do it all on its own, nor should it. We have long relied on a wide network of private charities and social service providers, community organizations and religious groups, what you might call the sinews of our civil society, to partner with the public sector, to fill in the gaps of the Government's reach and, in particular, to target aid to local priorities and problems. That is what this bill will do.

We start with a new focus on building and leveraging the capacity of the small faith-based and community organizations who are often in the best position to help people in need because they are closest to them. But in many cases, they don't have the technical wherewithal to find the public resources to do so. So to help those groups, the CARE Act creates a Compassion Capital Fund authorized at $150 million a year that will underwrite a wide range of technical assistance efforts. But the bill goes beyond just expanding the pool of applicants and enlarges the pie of resources that is available to America's charities and social services providers. That will be particularly critical at this difficult time in our Nation's economic history when charities are stretched.

I saw an article in the paper in the last 24 hours that said the United Way expects a significant drop in its fundraising this year because of the economic problems America faces. I hope and believe this bill will create the incentives for more giving to the United Way and a host of other charities, national and local. It will do so by creating several well targeted tax incentives over the next years that total $10.6 billion which, working from the general rule that most tax incentives are worth about 30 cents on the dollar to a taxpayer, should lead to new donations to charities, community-based, faith-based, of more than $30 billion over the next 10 years. How much good will come from that is wonderful to contemplate.

Part of the CARE Act that may make as big a difference and of which I am particularly proud is the $1.3 billion increase in Social Service Block Grant (SSBG) funding over the next 2 years. The CARE Act will finally make good on our commitment by restoring SSBG funding to its authorized level of $2.8 billion over the next 2 years and in so doing would empower charities across the country to do good for so many people in need.

I want to mention one other provision in the bill which has been a labor of love for me and Senator Santorum. That provision would expand on the use of innovative savings accounts, known as Individual Development Accounts (IDAs), to help low-income working families build wealth and achieve financial self-sufficiency. There have been a number of IDA demonstration projects around America that have proven successful in making home ownership, college, and small business not just a dream but a reality for thousands of low-income people nationwide. The CARE Act aims to build on those successes and significantly increase the availability of IDAs by offering America's financial institutions new incentives to help low-income families who want to save for their future which represents a whole new strategy in fighting poverty. It is based on a growing body of research that shows the best path to the middle class comes not just from hard work but also through savings and asset accumulation.

In sum, this CARE Act represents a comprehensive response to a complicated problem. That is why it is broadly and enthusiastically embraced by charities all over America. This bill puts our shared values into action by elevating the priority we place on helping our most vulnerable citizens. For that I thank my colleagues for their support.

I particularly thank Senator Santorum with whom it has been a pleasure to work in this long-time effort. His dedication, his commitment, his faith, his persistence, and his willingness to accommodate and reach common ground is a good part of the reason why we are on the verge of this very significant accomplishment. I thank the leaders of the Finance Committee, Senator Grassley and Senator Baucus, and I thank my leader, Senator Daschle, who worked with us as we negotiated this logjam-breaking compromise with the administration and then pushed hard among our ranks to have this bill considered on the Senate floor. Senator Daschle's staff, particularly Jennifer Duck and Andrea LaRue, has been indispensable to this mission.

Finally, I thank my own staff for the dedicated work they have done on this exceedingly challenging but important legislation. Specifically, I am grateful to Laurie Rubenstein, Debbie Forrest, Dan Gerstein, Chuck Ludlam, and Michelle McMurray. We could not have passed the bill without them.

I urge my colleagues to support the bill and yield the floor.

Madam President, I am disappointed that the administration has put out a statement today opposing the SSBG provisions in this bill, especially after we negotiated a bill with the Administration that included those provisions. The SSBG funding is critically important to this bill. It funds a number of essential social services that have been harmed by cuts to that program. I'd like to put in the record here the results of a survey done by the United Way of America.

In January 2000, UWA conducted an informal survey to assess the impact cuts to SSBG have had on local United Ways and their community partners. This study represents the impact of cuts from a funding level of $2.8 billion to SSBG in fiscal year 1995, to $1.9 billion in fiscal year 1999. Since conducting the survey, SSBG funding has been further reduced to $1.7 billion.

Following summarizes ``The Stories Behind the Social Services Block Grant: A Survey by United Way of America.''

Effect of SSBG Cuts on Health and Human Service Agencies:

One hundred thirty-eight agencies from 26 States responded.

Effect on budget: 38 percent received less SSBG money in

1999 than in the 1995; 42 percent have been level funded for

the past 5 years.

Effect on services: 17 percent of the total respondents had

to cut programs to compensate for SSBG cuts; 29 percent of

the agencies that received less SSBG money in 1999 than in

1995 were forced to cut programs; 32 percent of the total

respondents had to cut staff to compensate for SSBG cuts; 50

percent of the agencies that received less SSBG money in 1999

than in 1995 had to cut staff; 46 percent of the total

respondents were forced to serve fewer clients; 73 percent of

the agencies that received less SSBG money in 1999 than in

1995 were forced to serve fewer clients.

Respondents' median 1999 grant: $70,472.00.

Median percent of respondents' budget that SSBG represents:

10 percent.

Median number of people served with respondents' SSBG

funds: 180.

The survey found that further cuts to SSBG would greatly reduce the reach and impact programs that provide services for a full range of health and human services from child welfare and

child care to youth development, job training and other work supports for those transitioning off welfare, assistance for domestic violence victims, respite care, home care services and information and referral. The administration's backtracking on its assurances about funding this program will further damage these efforts.

Madam President, the amendment by Senator Nickles is in order, is that right?

Senator Nickles will offer his amendment in just a minute. He asked if I would do my speaking on that amendment at this point. I am very happy to do that.

I appreciate my friend's continued efforts to reform and reduce long term capital gain tax on real estate. And Senator Nickles is correct-- by excluding 25 percent of the capital gain on the sale of property we reduce the effective capital gain rate on sales for conservation purposes.

However, that is not the purpose of the provision. We intend to preserve precious, environmentally sensitive land from ever being developed. I need not remind my fellow Senators that they are not making any more land and if we do not preserve sensitive wetlands and open space from development it will be lost forever and all of our children and grandchildren will suffer from our lack of responsibility.

Senator Nickles' amendment would literally make it easier to develop the very land we are attempting to preserve. That is certainly not the intent of this provision. I will be voting no and I strongly urge my fellow Senators to also vote no on Senator Nickles' amendment.

I would like to take a few minutes to review the long history of this important provision. As you all know, the President's budget has included this proposal. In all of his budgets, in fact, the President actually continues to propose the exclusion of 50 percent of the capital gain for the sale of property for conservation purposes. So by comparison, this 25 percent proposal is modest, but still addresses the President's priorities.

In addition, the Senate Finance Committee has a long history of building support. In both the 106th and 107th Congresses, we held hearings specifically discussing this proposal. We had witnesses from the forests of Maine to the wetlands of Louisiana and the ranches of Arizona. Besides, this effort brings about bipartisan support for the issue.

Not only have we heard huge support for this provision from all the traditional conservation organizations, like the Nature Conservancy and the Land Trusts and Iowa's own Heritage Foundation, but I know both I and Senator Baucus continue to receive very vocal support from the farmers and ranchers who populate our States. Both the Farm Bureau and the Cattleman's Association have let us know that this gives our citizens choices to stay on the land and yet preserve the open space.

The opportunity to give an easement, preserve our farm and ranch lifestyles and give up the right to ever develop the land is important public policy and I urge my fellow Senators to vote no on Senator Nickles' amendment.

I yield such time as he might consume to the Senator from Pennsylvania.

Madam President, I move to table the----

I think we should wait until 12:30. I will wait. I yield the floor.

Madam President, I move to table the amendment and I ask for the yeas and nays and then that the vote occur at 12:30.

I move to reconsider the vote.

Madam President, it is my intention to yield back all of my time except for 30 seconds.

Welfare Benefit Plans In Relation to title VII

I am aware that the Treasury and Labor Departments are always examining the so-called welfare benefit plans because of aggressive uses of some arrangements. Taxpayers need certainty and clarity from the enforcement agencies that they can rely upon, so they do not run afoul of the rules and operate plans in accordance with the requirements of the law. It would be unwise to exclude a particular type of arrangement from the rules governing tax shelters, however, based upon some the abuses we have seen. But we can urge the Treasury Department to provide clearer guidance on the many welfare benefit plan arrangements. I am willing to join you in writing the Treasury Department to ask them for clearer guidance as soon as practicable.

Madam President, I rise today to speak in support of a key provision in the CARE Act, the restoration of $1.375 billion for the Social Services Block Grant Program or SSBG.

As my colleagues know, SSBG is an extremely flexible grant program that states use to pay for a wide variety of social services activities. States have broad discretion over the use of these funds. In recent years, the largest expenditures for services under the SSBG were for child protective services, children's foster care and prevention and intervention services.

Additionally, SSBG funds go to provide crucial services such as respite care for the elderly, adult protective services, as well as adoption programs.

In 1996, during the debate over welfare reauthorization, the Congress and the States agreed to temporarily decrease SSBG from $2.8 billion a year to $2.38 billion a year, until welfare reform was firmly established. The agreement further stipulated that SSBG would be funded at $2.38 billion per year until fiscal year 2003 when it would be restored to $2.8 billion per year.

We have not lived up to our promise. Funding for SSBG has been reduced considerably. Currently this vital program is funded at $1.7 billion a year.

This program is very important in my State of Iowa.

There were over 119,708 children and adults benefitting from SSBG- funded services in the state of Iowa in fiscal year 2000.

Iowa spent almost half of their $29 million block grant--48 percent-- on services to persons with disabilities covering both physically disabled and developmentally disabled persons. Services include adult residential care, adult day care, community-supervised living, sheltered workshops and work activities.

Iowa used $982,078 in SSBG for the prevention of abuse and neglect to elderly and disabled persons compared to receiving only $55,927 from the title VII Elder Abuse under the Older Americans Act.

I worked very hard to ensure that SSBG was included in the CARE Act. The reason why I felt so strongly that it be included in the bill is because I see an SSBG increase as one of the ways we can direct fiscal relief to the states.

States are currently suffering under the worst fiscal crisis since World War II. I am committed to finding ways to assist the states manage this fiscal crisis. I view the inclusion of the restoration of SSBG funds as a good first step towards assisting the States make it through this current crisis.

I appreciate my colleagues' hard work on this bill and look forward to its enactment into law.

Madam President, I yield back all of my time except for 30 seconds that I want to yield to the Senator from Pennsylvania, because of his hard work on this legislation.

Madam President, have the yeas and nays been ordered?

I ask for the yeas and nays.

Madam President, I want to take a brief moment to thank the many, many people that helped bring President Bush's words supporting charities and charitable giving into reality.

First, I thank my colleague, Senator Baucus. I appreciate his bipartisanship on this matter. The people of Montana are well served by his leadership on the Senate Finance Committee. In addition, I thank the Democratic staff on the Finance Committee, Russ Sullivan, Pat Heck and Jon Selib, for their work.

At this time, I should also commend the work of my staff on the Finance Committee, Dean Zerbe for the charitable provisions and Ed McClellan for the corporate shelter legislation. In addition, Mark Prater, Elizabeth Paris, Christy Mistr and Diann Howland were critical in putting this bill together.

It is clear that without the drive and energy of Senators Santorum and Lieberman we would not have had this success. I thank them for their efforts and their staff: Randy Brandt and Chuck Ludlam.

I also thank all those behind the scenes who have toiled on the CARE Act. Roger Colvineaux, Ron Schultz, Joe Naga from the Joint Committee on Taxation, as well as Mark Mathiesen from Legislative Counsel who did all the drafting.

Finally, let me note just a few of the members of the administration who ably served the President in this effort: Jim Towey, David Kuo, and Susan Brown at Treasury.

Thanks to all for their efforts.

I compliment both my colleagues from Iowa and Montana for bringing up this bill.

Amendment No. 527

(Purpose: To exclude 25 percent of gain on sales or exchanges of land or water interests to any nonprofit entity for any charitable purpose)

Madam President, this bill has a lot of good provisions in it. It has two provisions of which I question the value. I decided to do one amendment.

One of the ones I question is, how much good does the above-line deduction do? If you are an individual, you have to donate $500, and you get a $250 deduction. So if you are in the 25-percent tax bracket, that means you get to save $62. And we add a lot of complexity to the Tax Code in the process. So I question the value of that.

There are several other provisions in the bill that are good-- donations from IRAs to charities. The purpose of the bill is to increase donations to charities. I compliment the thrust of that. I compliment the President for trying to enact it.

I am disappointed this bill does not do more for allowing charitable and/or religious groups to be eligible to participate in Federal programs. That is not in the bill. I am not faulting anybody. I compliment Senator Santorum because he worked tirelessly to get this bill forward. And I, as a legislator, am willing to take half a loaf.

I think the Senator from Pennsylvania has about half of his original bill. I compliment him. He has been tenacious. I also compliment my colleague, Senator Lieberman, because he is a cosponsor of the bill. I worked with him on other legislation, including the religious liberty, freedom bill that we cosponsored some time ago.

One of the provisions I am trying to amend right now is a provision that says you will have a 25-percent reduction in capital gains tax if you sell property for land conservation or sell to an organization that qualifies for land conservation. I question the wisdom of doing that. I say, if we are going to have a 25-percent reduction in capital gains tax for charitable purposes, make it for all charities.

I happen to be a big fan of Nature Conservancy. They have a big facility in my State, with a lot of land, a big buffalo farm or ranch. I helped create that. The Nature Conservancy gets support from lots of corporations all across the country and my State as well. I support that.

But what I question is, if we want to help charities, let's help all charities, so if people want to sell land to the Red Cross, they would get a 25-percent reduction as well, or if they want to sell land to a church--and the church may want to build a parking lot or build a bigger church on that land--let's give them the 25-percent reduction.

Why should we say: Well, you are going to get a lower tax rate only if you sell to the charity we choose. That is land conservation? I question the wisdom of that. I do not like trying to micromanage, in the Tax Code, how people are going to spend their money.

So I would encourage our colleagues, let's help all charities. I do not think you can defend saying: Well, I think it is fine to donate land to the Nature Conservancy or to the Sierra Club or to the Land Trust Alliance or a lot of little groups that are going to be created as a result of this--you don't donate the land; you sell the land--you can donate your land to anybody in the country--but if you want to sell your land, you can sell it to this group, and you are going to get a 25-percent reduction in your capital gains tax. So we would rather give you that if you sell it to the Nature Conservancy but not sell it to the First Baptist Church in rural Iowa. To me, that does not make sense. Or if you want to help the Red Cross--and the Red Cross has a nice facility in Oklahoma, thanks to the Presiding Officer--and they need land, and if a farmer wants to sell that land--they could not afford to donate it, but they wanted to sell it--why would we say: You can only sell it for land conservation, and we will give you a 25- percent reduction in your tax bill. But if you want to sell it to the Red Cross, or if you want to sell it to a church, or if you want to sell it to a children's hospital, no, we are sorry, you are out of luck. Congress decided that charity does not deserve the same tax benefits as land conservation.

I disagree. I say, if we are going to give a lower capital gains tax rate, and this would be 15 percent--frankly, I think we should do it for all Americans, but if we are going to do it for one charity or two or three charities, let's do it for all charities.

So that is the essence of my amendment. If we are going to have a lower capital gains tax rate on some charities, let's make it available for all charities.

We have offsets in this amendment. It does not increase the deficit. I urge my colleagues to support the amendment.

I reserve the remainder of my time.

Madam President, is the amendment pending?

Madam President, I apologize. I send the amendment to the desk and thank my colleagues for their cooperation. I thought the amendment was pending. I apologize to my colleagues.

Will the Senator yield first? I am not sure we used all of our time.

I am happy to conclude shortly. Correct me if I am wrong, but I was thinking the vote was at 12:30, or are we trying to move it up?

If the Senator wants to ask consent to move to table the amendment and have the vote commence at 12:30, I am happy to do that. Usually, when you move to table, you conclude the debate.

Madam President, parliamentary inquiry: How much time remains on the amendment?

I am happy to yield.

Madam President, I appreciate the comments of my colleague and friend from Idaho. He makes a very good point. Western States have a lot of public land and not a lot of private land. This amendment says if you are going to sell land to a charity that deals with conservation, you get a 25 percent lower capital gains tax than if you sell to any other charity.

My amendment would say if you sell to any charity, you will get a reduced capital gains tax. I mentioned the Nature Conservancy. They are big in my State. They bought one of the biggest ranches--a buffalo ranch--in Oklahoma. It is in the tall grass prairie. I love it. I helped make that happen. The Nature Conservancy is a big group. I don't know how great their assets are, but I guess it is in the millions of dollars--lots of land and lots of millions of dollars. If you sell to that group, you get a 25 percent reduction in your capital gains tax. I don't think they need it, compared to a church in Oklahoma, maybe in a rural area, which might want to build or expand. But if you want to sell to that church, you have to pay a 25 percent higher tax than if you sell it to a conservancy group, or the Sierra Club, that wants to build a conservancy or other groups that might want to say: Hey, you get a lower deal; sell it to us.

Let's encourage charitable contributions, but let's also encourage sales to charitable organizations. If we are going to do it for one charitable organization, let's do it for all charitable organizations. That is the essence of my amendment. We have paid for it. It is offset. I urge my colleagues to support it. If we are going to encourage charitable sales, let's do it for all of them, not just conservation groups. I urge my colleagues to vote against the motion to table.

I yield the remainder of my time.

I suggest the absence of a quorum.

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

Madam President, I am delighted that the Finance Committee has included my volunteer mileage reimbursement legislation in the CARE Act, and I want to take this opportunity to thank the Chairman Grassley and the ranking member Baucus for their efforts to include this needed provision. I am also pleased that some troubling provisions have been deleted from this legislation. In particular, I congratulate the sponsors for agreeing to drop title VIII before bringing the bill to the floor. Doing so strengthens this bill, and will greatly speed consideration of the measure.

Under current law, when volunteers use their cars for charitable purposes, the volunteers may be reimbursed up to 14 cents per mile for their donated services without triggering a tax consequence for either the organization or the volunteers. If the charitable organization reimburses any more than that, the organization is required to file an information return with the IRS, and the volunteers must include the amount over 14 cents per mile in their taxable income. By contrast, the mileage reimbursement level currently permitted for businesses is 36 cents per mile.

At a time when Government is asking volunteers and volunteer organizations to bear a greater burden of delivering essential services, the 14 cents per mile limit is posing a very real hardship on charitable organizations and other nonprofit groups. I have heard from a number of people in Wisconsin on the need to increase this reimbursement limit.

At a listening session I held in Portage County, WI, representatives of the local Department on Aging explained just how important volunteer drivers are to their ability to provide services to seniors in that county. The Department on Aging reported that in 2001, 54 volunteer drivers delivered meals to homes and transported people to medical appointments, meal sites, and other essential services. The Department noted that their volunteer drivers provided 4,676 rides, and drove nearly 126,000 miles. They also delivered 9,385 home-delivered meals, and nearly two-thirds of the drivers logged more than 100 miles per month in providing these needed services. Together, volunteers donated over 5,200 hours last year, and as the Department notes, at the rate of minimum wage, that amounts to over $27,000, not including other benefits.

As many of my colleagues know, the senior meals program is one of the most vital services provided under the Older Americans Act, and ensuring that meals can be delivered to seniors or that seniors can be taken to meal sites is an essential part of that program. Unfortunately, federal support for the senior nutrition programs has stagnated in recent years. This has increased pressure on local programs to leverage more volunteer services to make up for lagging federal support. The 14 cents per mile reimbursement limit, though, increasingly poses a barrier to obtaining those contributions. Portage County reports that many of their volunteers cannot afford to offer their services under such a restriction. And if volunteers cannot be found, their services will have to be replaced by contracting with a provider, greatly increasing costs to the department, costs that come directly out of the pot of funds available to pay for meals and other services.

By contrast, businesses do not face this restrictive mileage reimbursement limit. The comparable mileage rate for someone who works for a business is currently 36 cents per mile. This disparity means that a business hired to deliver the same meals delivered by volunteers for Portage County may reimburse their employees over double

the amount permitted the volunteer without a tax consequence.

This doesn't make sense. The 14 cents per mile volunteer reimbursement limit is badly outdated. According to the Congressional Research Service, Congress first set a reimbursement rate of 12 cents per mile as part of the Deficit Reduction Act of 1984, and did not increase it until 1997, when the level was raised slightly, to 14 cents per mile, as part of the Taxpayer Relief Act of 1997.

The provision included in the CARE Act addresses this problem by raising the limit on volunteer mileage reimbursement to the level permitted to businesses, currently 36 cents per mile.

Once again, I thank the chairman and ranking member of the Finance Committee for their help in including this provision in the CARE Act. This timely measure will help ensure that charitable organizations can continue to attract the volunteers who play such a critical role in helping to deliver services, and it will simplify the tax code both for nonprofit groups and the volunteers themselves.

As I noted earlier, I am also pleased that the sponsors of the CARE Act agreed to drop title VIII before bringing the bill to the floor. I had two serious concerns about title VIII. First, it threatened to undermine our Nation's long-standing public policy against discrimination in employment. Religious organizations currently enjoy an exemption from title VII of the Civil Rights Act of 1964, allowing them to discriminate against individuals on the basis of religion when making employment decisions about individuals involved in religious services. The bill as introduced was silent on this issue and therefore threatened to extend this exemption and allow religious groups that provide federally funded social services to discriminate on the basis of religion in hiring, firing, or promotion decisions.

Second, title VIII could have allowed religious organizations receiving Federal funds to proselytize during the provision of the federally funded social service. Faith-based organizations do a lot of good work in our society. But the Founders were right when they crafted the Constitution's separation of church and state provision. We need to protect each American's right to practice his or her religion as he or she chooses. I am troubled by the possibility that, regardless of good intentions, in practice, people who are in trouble would feel pressured to engage in religious activities that they are not comfortable with in order to get access to help, or otherwise be denied the services that they desperately need.

Again, I am pleased that title VIII, the problematic faith-based provision, has been dropped from the version of the bill that is before the Senate today. Congress, however, must continue to be vigilant to ensure that we do not enact legislation that allows taxpayer dollars to be used to promote employment discrimination based on religion, or religious instruction, worship, or proselytization.