I
109th CONGRESS
2d Session
H. R. 6408
IN THE HOUSE OF REPRESENTATIVES
December 7, 2006
Mr. Thomas introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Energy and Commerce, Resources, Education and the Workforce, and Government Reform, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned
A BILL
To amend the Internal Revenue Code of 1986 to extend expiring provisions, and for other purposes.
Short title, etc
Short title
This Act may be cited
as the Tax Relief and Health Care Act
of 2006
.
Table of contents
The table of contents for this Act is as follows:
Sec. 1. Short title, etc.
Division A—Extension and Expansion of Certain Tax Relief Provisions, and Other Tax Provisions
Sec. 100. Reference.
Title I—Extension and Modification of Certain Provisions
Sec. 101. Deduction for qualified tuition and related expenses.
Sec. 102. Extension and modification of new markets tax credit.
Sec. 103. Election to deduct State and local general sales taxes.
Sec. 104. Extension and modification of research credit.
Sec. 105. Work opportunity tax credit and welfare-to-work credit.
Sec. 106. Election to include combat pay as earned income for purposes of earned income credit.
Sec. 107. Extension and modification of qualified zone academy bonds.
Sec. 108. Above-the-line deduction for certain expenses of elementary and secondary school teachers.
Sec. 109. Extension and expansion of expensing of brownfields remediation costs.
Sec. 110. Tax incentives for investment in the District of Columbia.
Sec. 111. Indian employment tax credit.
Sec. 112. Accelerated depreciation for business property on Indian reservations.
Sec. 113. Fifteen-year straight-line cost recovery for qualified leasehold improvements and qualified restaurant property.
Sec. 114. Cover over of tax on distilled spirits.
Sec. 115. Parity in application of certain limits to mental health benefits.
Sec. 116. Corporate donations of scientific property used for research and of computer technology and equipment.
Sec. 117. Availability of medical savings accounts.
Sec. 118. Taxable income limit on percentage depletion for oil and natural gas produced from marginal properties.
Sec. 119. American Samoa economic development credit.
Sec. 120. Extension of bonus depreciation for certain qualified Gulf Opportunity Zone property.
Sec. 121. Authority for undercover operations.
Sec. 122. Disclosures of certain tax return information.
Sec. 123. Special rule for elections under expired provisions.
Title II—Energy tax provisions
Sec. 201. Credit for electricity produced from certain renewable resources.
Sec. 202. Credit to holders of clean renewable energy bonds.
Sec. 203. Performance standards for sulfur dioxide removal in advanced coal-based generation technology units designed to use subbituminous coal.
Sec. 204. Deduction for energy efficient commercial buildings.
Sec. 205. Credit for new energy efficient homes.
Sec. 206. Credit for residential energy efficient property.
Sec. 207. Energy credit.
Sec. 208. Special rule for qualified methanol or ethanol fuel.
Sec. 209. Special depreciation allowance for cellulosic biomass ethanol plant property.
Sec. 210. Expenditures permitted from the Leaking Underground Storage Tank Trust Fund.
Sec. 211. Treatment of coke and coke gas.
Title III—Health Savings Accounts
Sec. 301. Short title.
Sec. 302. FSA and HRA terminations to fund HSAs.
Sec. 303. Repeal of annual deductible limitation on HSA contributions.
Sec. 304. Modification of cost-of-living adjustment.
Sec. 305. Contribution limitation not reduced for part-year coverage.
Sec. 306. Exception to requirement for employers to make comparable health savings account contributions.
Sec. 307. One-time distribution from individual retirement plans to fund HSAs.
Title IV—Other Provisions
Sec. 401. Deduction allowable with respect to income attributable to domestic production activities in Puerto Rico.
Sec. 402. Credit for prior year minimum tax liability made refundable after period of years.
Sec. 403. Returns required in connection with certain options.
Sec. 404. Partial expensing for advanced mine safety equipment.
Sec. 405. Mine rescue team training tax credit.
Sec. 406. Whistleblower reforms.
Sec. 407. Frivolous tax submissions.
Sec. 408. Addition of meningococcal and human papillomavirus vaccines to list of taxable vaccines.
Sec. 409. Clarification of taxation of certain settlement funds made permanent.
Sec. 410. Modification of active business definition under section 355 made permanent.
Sec. 411. Revision of State veterans limit made permanent.
Sec. 412. Capital gains treatment for certain self-created musical works made permanent.
Sec. 413. Reduction in minimum vessel tonnage which qualifies for tonnage tax made permanent.
Sec. 414. Modification of special arbitrage rule for certain funds made permanent.
Sec. 415. Great Lakes domestic shipping to not disqualify vessel from tonnage tax.
Sec. 416. Use of qualified mortgage bonds to finance residences for veterans without regard to first-time homebuyer requirement.
Sec. 417. Exclusion of gain from sale of a principal residence by certain employees of the intelligence community.
Sec. 418. Sale of property by judicial officers.
Sec. 419. Premiums for mortgage insurance.
Sec. 420. Modification of refunds for kerosene used in aviation.
Sec. 421. Regional income tax agencies treated as States for purposes of confidentiality and disclosure requirements.
Sec. 422. Designation of wines by semi-generic names.
Sec. 423. Modification of railroad track maintenance credit.
Sec. 424. Modification of excise tax on unrelated business taxable income of charitable remainder trusts.
Sec. 425. Loans to qualified continuing care facilities made permanent.
Sec. 426. Technical corrections.
Division B—Medicare and Other Health Provisions
Sec. 1. Short title of division.
Title I—Medicare Improved Quality and Provider Payments
Sec. 101. Physician payment and quality improvement.
Sec. 102. Extension of floor on Medicare work geographic adjustment.
Sec. 103. Update to the composite rate component of the basic case-mix adjusted prospective payment system for dialysis services.
Sec. 104. Extension of treatment of certain physician pathology services under Medicare.
Sec. 105. Extension of Medicare reasonable costs payments for certain clinical diagnostic laboratory tests furnished to hospital patients in certain rural areas.
Sec. 106. Hospital Medicare reports and clarifications.
Sec. 107. Payment for brachytherapy.
Sec. 108. Payment process under the competitive acquisition program (CAP).
Sec. 109. Quality reporting for hospital outpatient services and ambulatory surgical center services.
Sec. 110. Reporting of anemia quality indicators for Medicare part B cancer anti-anemia drugs.
Sec. 111. Clarification of hospice satellite designation.
Title II—Medicare Beneficiary Protections
Sec. 201. Extension of exceptions process for Medicare therapy caps.
Sec. 202. Payment for administration of part D vaccines.
Sec. 203. OIG study of never events.
Sec. 204. Medicare medical home demonstration project.
Sec. 205. Medicare DRA technical corrections.
Title III—Medicare Program Integrity Efforts
Sec. 301. Offsetting adjustment in Medicare Advantage Stabilization Fund.
Sec. 302. Extension and expansion of recovery audit contractor program under the Medicare Integrity Program.
Sec. 303. Funding for the Health Care Fraud and Abuse Control Account.
Sec. 304. Implementation funding.
Title IV—Medicaid and Other Health Provisions
Sec. 401. Extension of Transitional Medical Assistance (TMA) and abstinence education program.
Sec. 402. Grants for research on vaccine against Valley Fever.
Sec. 403. Change in threshold for Medicaid indirect hold harmless provision of broad-based health care taxes.
Sec. 404. DSH allotments for fiscal year 2007 for Tennessee and Hawaii.
Sec. 405. Certain Medicaid DRA technical corrections.
Division C—Other Provisions
Title I—Gulf of Mexico Energy Security
Sec. 101. Short title.
Sec. 102. Definitions.
Sec. 103. Offshore oil and gas leasing in 181 Area and 181 south Area of Gulf of Mexico.
Sec. 104. Moratorium on oil and gas leasing in certain areas of Gulf of Mexico.
Sec. 105. Disposition of qualified outer Continental Shelf revenues from 181 Area, 181 south Area, and 2002–2007 planning areas of Gulf of Mexico.
Title II—Surface Mining Control and Reclamation Act Amendments of 2006
Sec. 200. Short title.
Subtitle A—Mining control and reclamation
Sec. 201. Abandoned Mine Reclamation Fund and purposes.
Sec. 202. Reclamation fee.
Sec. 203. Objectives of Fund.
Sec. 204. Reclamation of rural land.
Sec. 205. Liens.
Sec. 206. Certification.
Sec. 207. Remining incentives.
Sec. 208. Extension of limitation on application of prohibition on issuance of permit.
Sec. 209. Tribal regulation of surface coal mining and reclamation operations.
Subtitle B—Coal Industry Retiree Health Benefit Act
Sec. 211. Certain related persons and successors in interest relieved of liability if premiums prepaid.
Sec. 212. Transfers to funds; premium relief.
Sec. 213. Other provisions.
Title III—Other Provisions
Sec. 301. Tobacco personal use quantity exception to not apply to delivery sales.
Sec. 302. Ethanol Tariff Schedule.
Sec. 303. Withdrawal of certain Federal land and interests in certain Federal land from location, entry, and patent under the mining laws and disposition under the mineral and geothermal leasing laws.
Sec. 304. Continuing eligibility for certain students under District of Columbia School Choice Program.
Sec. 305. Study on Establishing Uniform National Database on Elder Abuse.
Extension and Expansion of Certain Tax Relief Provisions, and Other Tax Provisions
Reference
Except as otherwise expressly provided, whenever in this division an amendment or repeal is expressed in terms of an amendment to, or repeal of, a section or other provision, the reference shall be considered to be made to a section or other provision of the Internal Revenue Code of 1986.
Extension and Modification of Certain Provisions
Deduction for qualified tuition and related expenses
In general
Section 222(e) is amended by striking
2005
and inserting 2007
.
Conforming amendments
Section 222(b)(2)(B) is amended—
by striking
a taxable year beginning in 2004 or 2005
and inserting
any taxable year beginning after 2003
, and
by striking
2004 and
2005
in the heading and inserting
After
2003
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2005.
Extension and modification of new markets tax credit
Extension
Section
45D(f)(1)(D) is amended by striking and 2007
and inserting
, 2007, and 2008
.
Regulations regarding non-metropolitan counties
Section 45D(i) is amended by
striking and
at the end of paragraph (4), by striking the period
at the end of paragraph (5) and inserting , and
, and by adding
at the end the following new paragraph:
which ensure that non-metropolitan counties receive a proportional allocation of qualified equity investments.
.
Effective date
The amendments made by this section shall take effect on the date of the enactment of this Act.
Election to deduct State and local general sales taxes
In general
Section 164(b)(5)(I) is amended by striking
2006
and inserting 2008
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2005.
Extension and modification of research credit
Extension
In general
Section 41(h)(1)(B) is amended by striking
2005
and inserting 2007
.
Conforming amendment
Section 45C(b)(1)(D) is amended by striking
2005
and inserting 2007
.
Effective date
The amendments made by this subsection shall apply to amounts paid or incurred after December 31, 2005.
Increase in rates of alternative incremental credit
In general
Subparagraph (A) of section 41(c)(4) (relating to election of alternative incremental credit) is amended—
by striking
2.65 percent
and inserting 3 percent
,
by striking
3.2 percent
and inserting 4 percent
, and
by striking
3.75 percent
and inserting 5 percent
.
Effective date
Except as provided in paragraph (3), the amendments made by this subsection shall apply to taxable years ending after December 31, 2006.
Transition rule
In general
In the case of a specified transitional taxable year for which an election under section 41(c)(4) of the Internal Revenue Code of 1986 applies, the credit determined under section 41(a)(1) of such Code shall be equal to the sum of—
the applicable 2006 percentage multiplied by the amount determined under section 41(c)(4)(A) of such Code (as in effect for taxable years ending on December 31, 2006), plus
the applicable 2007 percentage multiplied by the amount determined under section 41(c)(4)(A) of such Code (as in effect for taxable years ending on January 1, 2007).
Definitions
For purposes of subparagraph (A)—
Specified transitional taxable year
The term specified transitional taxable year means any taxable year which ends after December 31, 2006, and which includes such date.
Applicable 2006 percentage
The term applicable 2006 percentage means the number of days in the specified transitional taxable year before January 1, 2007, divided by the number of days in such taxable year.
Applicable 2007 percentage
The term applicable 2007 percentage means the number of days in the specified transitional taxable year after December 31, 2006, divided by the number of days in such taxable year.
Alternative simplified credit for qualified research expenses
In general
Subsection (c) of section 41 (relating to base amount) is amended by redesignating paragraphs (5) and (6) as paragraphs (6) and (7), respectively, and by inserting after paragraph (4) the following new paragraph:
Election of alternative simplified credit
In general
At the election of the taxpayer, the credit determined under subsection (a)(1) shall be equal to 12 percent of so much of the qualified research expenses for the taxable year as exceeds 50 percent of the average qualified research expenses for the 3 taxable years preceding the taxable year for which the credit is being determined.
Special rule in case of no qualified research expenses in any of 3 preceding taxable years
Taxpayers to which subparagraph applies
The credit under this paragraph shall be determined under this subparagraph if the taxpayer has no qualified research expenses in any one of the 3 taxable years preceding the taxable year for which the credit is being determined.
Credit rate
The credit determined under this subparagraph shall be equal to 6 percent of the qualified research expenses for the taxable year.
Election
An election under this paragraph shall apply to the taxable year for which made and all succeeding taxable years unless revoked with the consent of the Secretary. An election under this paragraph may not be made for any taxable year to which an election under paragraph (4) applies.
.
Transition rule for deemed revocation of election of alternative incremental credit
In the case of an election under section 41(c)(4) of the Internal Revenue Code of 1986 which applies to the taxable year which includes January 1, 2007, such election shall be treated as revoked with the consent of the Secretary of the Treasury if the taxpayer makes an election under section 41(c)(5) of such Code (as added by this subsection) for such year.
Effective date
Except as provided in paragraph (4), the amendments made by this subsection shall apply to taxable years ending after December 31, 2006.
Transition rule for noncalendar taxable years
In general
In the case of a specified transitional taxable year for which an election under section 41(c)(5) of the Internal Revenue Code of 1986 (as added by this subsection) applies, the credit determined under section 41(a)(1) of such Code shall be equal to the sum of—
the applicable 2006 percentage multiplied by the amount determined under section 41(a)(1) of such Code (as in effect for taxable years ending on December 31, 2006), plus
the applicable 2007 percentage multiplied by the amount determined under section 41(c)(5) of such Code (as in effect for taxable years ending on January 1, 2007).
Definitions and special rules
For purposes of subparagraph (A)—
Definitions
Terms used in this paragraph which are also used in subsection (b)(3) shall have the respective meanings given such terms in such subsection.
Dual elections permitted
Elections under paragraphs (4) and (5) of section 41(c) of such Code may both apply for the specified transitional taxable year.
Deferral of deemed election revocation
Any election under section 41(c)(4) of the Internal Revenue Code of 1986 treated as revoked under paragraph (2) shall be treated as revoked for the taxable year after the specified transitional taxable year.
Work opportunity tax credit and welfare-to-work credit
In general
Sections 51(c)(4)(B) and 51A(f) are each amended by
striking 2005
and inserting 2007
.
Eligibility of ex-felons determined without regard to family income
Paragraph
(4) of section 51(d) is amended by adding and
at the end of
subparagraph (A), by striking , and
at the end of subparagraph
(B) and inserting a period, and by striking all that follows subparagraph
(B).
Increase in maximum age for eligibility of food stamp recipients
Clause (i)
of section 51(d)(8)(A) is amended by striking 25
and inserting
40
.
Extension of paperwork filing deadline
Section 51(d)(12)(A)(ii)(II) is amended
by striking 21st day
and inserting 28th
day
.
Consolidation of work opportunity credit with welfare-to-work credit
In general
Paragraph (1) of section 51(d) is amended by striking
or
at the end of subparagraph (G), by striking the period at the
end of subparagraph (H) and inserting , or
, and by adding at the
end the following new subparagraph:
a long-term family assistance recipient.
.
Long-term family assistance recipient
Subsection (d) of section 51 is amended by redesignating paragraphs (10) through (12) as paragraphs (11) through (13), respectively, and by inserting after paragraph (9) the following new paragraph:
Long-term family assistance recipient
The term long-term family assistance recipient means any individual who is certified by the designated local agency—
as being a member of a family receiving assistance under a IV–A program (as defined in paragraph (2)(B)) for at least the 18-month period ending on the hiring date,
as being a member of a family receiving such assistance for 18 months beginning after August 5, 1997, and
as having a hiring date which is not more than 2 years after the end of the earliest such 18-month period, or
as being a member of a family which ceased to be eligible for such assistance by reason of any limitation imposed by Federal or State law on the maximum period such assistance is payable to a family, and
as having a hiring date which is not more than 2 years after the date of such cessation.
.
Increased credit for employment of long-term family assistance recipients
Section 51 is amended by inserting after subsection (d) the following new subsection:
Credit for second-year wages for employment of long-term family assistance recipients
In general
With respect to the employment of a long-term family assistance recipient—
the amount of the work opportunity credit determined under this section for the taxable year shall include 50 percent of the qualified second-year wages for such year, and
in lieu of applying subsection (b)(3), the amount of the qualified first-year wages, and the amount of qualified second-year wages, which may be taken into account with respect to such a recipient shall not exceed $10,000 per year.
Qualified second-year wages
For purposes of this subsection, the term qualified second-year wages means qualified wages—
which are paid to a long-term family assistance recipient, and
which are attributable to service rendered during the 1-year period beginning on the day after the last day of the 1-year period with respect to such recipient determined under subsection (b)(2).
Special rules for agricultural and railway labor
If such recipient is an employee to whom subparagraph (A) or (B) of subsection (h)(1) applies, rules similar to the rules of such subparagraphs shall apply except that—
such subparagraph
(A) shall be applied by substituting $10,000
for
$6,000
, and
such subparagraph
(B) shall be applied by substituting $833.33
for
$500
.
.
Repeal of separate welfare-to-work credit
In general
Section 51A is hereby repealed.
Clerical amendment
The table of sections for subpart F of part IV of subchapter A of chapter 1 is amended by striking the item relating to section 51A.
Effective dates
In general
Except as provided in paragraph (2), the amendments made by this section shall apply to individuals who begin work for the employer after December 31, 2005.
Consolidation
The amendments made by subsections (b), (c), (d), and (e) shall apply to individuals who begin work for the employer after December 31, 2006.
Election to include combat pay as earned income for purposes of earned income credit
In general
Section 32(c)(2)(B)(vi)(II) is amended by striking
2007
and inserting 2008
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2006.
Extension and modification of qualified zone academy bonds
In general
Paragraph (1) of section 1397E(e) is amended by striking
and 2005
and inserting 2005, 2006, and
2007
.
Special rules relating to expenditures, arbitrage, and reporting
In general
Section 1397E is amended—
in subsection
(d)(1), by striking and
at the end of subparagraph (C)(iii), by
striking the period at the end of subparagraph (D) and inserting ,
and
, and by adding at the end the following new subparagraph:
the issue meets the requirements of subsections (f), (g), and (h).
, and
by redesignating subsections (f), (g), (h), and (i) as subsection (i), (j), (k), and (l), respectively, and by inserting after subsection (e) the following new subsections:
Special rules relating to expenditures
In general
An issue shall be treated as meeting the requirements of this subsection if, as of the date of issuance, the issuer reasonably expects—
at least 95 percent of the proceeds from the sale of the issue are to be spent for 1 or more qualified purposes with respect to qualified zone academies within the 5-year period beginning on the date of issuance of the qualified zone academy bond,
a binding commitment with a third party to spend at least 10 percent of the proceeds from the sale of the issue will be incurred within the 6-month period beginning on the date of issuance of the qualified zone academy bond, and
such purposes will be completed with due diligence and the proceeds from the sale of the issue will be spent with due diligence.
Extension of period
Upon submission of a request prior to the expiration of the period described in paragraph (1)(A), the Secretary may extend such period if the issuer establishes that the failure to satisfy the 5-year requirement is due to reasonable cause and the related purposes will continue to proceed with due diligence.
Failure to spend required amount of bond proceeds within 5 years
To the extent that less than 95 percent of the proceeds of such issue are expended by the close of the 5-year period beginning on the date of issuance (or if an extension has been obtained under paragraph (2), by the close of the extended period), the issuer shall redeem all of the nonqualified bonds within 90 days after the end of such period. For purposes of this paragraph, the amount of the nonqualified bonds required to be redeemed shall be determined in the same manner as under section 142.
Special rules relating to arbitrage
An issue shall be treated as meeting the requirements of this subsection if the issuer satisfies the arbitrage requirements of section 148 with respect to proceeds of the issue.
Reporting
Issuers of qualified academy zone bonds shall submit reports similar to the reports required under section 149(e).
.
Conforming amendments
Sections 54(l)(3)(B) and 1400N(l)(7)(B)(ii) are each
amended by striking section 1397E(i)
and inserting
section 1397E(l)
.
Effective dates
Extension
The amendment made by subsection (a) shall apply to obligations issued after December 31, 2005.
Special rules
The amendments made by subsection (b) shall apply to obligations issued after the date of the enactment of this Act pursuant to allocations of the national zone academy bond limitation for calendar years after 2005.
Above-the-line deduction for certain expenses of elementary and secondary school teachers
In general
Subparagraph (D) of section 62(a)(2) is amended by
striking or 2005
and inserting 2005, 2006, or
2007
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2005.
Extension and expansion of expensing of brownfields remediation costs
Extension
Subsection
(h) of section 198 is amended by striking 2005
and inserting
2007
.
Expansion
Section
198(d)(1) (defining hazardous substance) is amended by striking
and
at the end of subparagraph (A), by striking the period at
the end of subparagraph (B) and inserting , and
, and by adding
at the end the following new subparagraph:
any petroleum product (as defined in section 4612(a)(3)).
.
Effective date
The amendments made by this section shall apply to expenditures paid or incurred after December 31, 2005.
Tax incentives for investment in the District of Columbia
Designation of zone
In general
Subsection (f) of section 1400 is amended by striking
2005
both places it appears and inserting
2007
.
Effective date
The amendments made by this subsection shall apply to periods beginning after December 31, 2005.
Tax-exempt economic development bonds
In general
Subsection (b) of section 1400A is amended by striking
2005
and inserting 2007
.
Effective date
The amendment made by this subsection shall apply to bonds issued after December 31, 2005.
Zero percent capital gains rate
In general
Subsection (b) of section 1400B is amended by striking
2006
each place it appears and inserting
2008
.
Conforming amendments
Section 1400B(e)(2) is amended—
by
striking 2010
and inserting 2012
, and
by
striking 2010
in the heading thereof and inserting
2012
.
Section
1400B(g)(2) is amended by striking 2010
and inserting
2012
.
Section 1400F(d)
is amended by striking 2010
and inserting
2012
.
Effective dates
Extension
The amendments made by paragraph (1) shall apply to acquisitions after December 31, 2005.
Conforming amendments
The amendments made by paragraph (2) shall take effect on the date of the enactment of this Act.
First-time homebuyer credit
In general
Subsection (i) of section 1400C is amended by striking
2006
and inserting 2008
.
Effective date
The amendment made by this subsection shall apply to property purchased after December 31, 2005.
Indian employment tax credit
In general
Section 45A(f) is amended by striking 2005
and inserting 2007
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2005.
Accelerated depreciation for business property on Indian reservations
In general
Section 168(j)(8) is amended by striking
2005
and inserting 2007
.
Effective date
The amendment made by this section shall apply to property placed in service after December 31, 2005.
Fifteen-year straight-line cost recovery for qualified leasehold improvements and qualified restaurant property
In general
Clauses (iv) and (v) of section 168(e)(3)(E) are each
amended by striking 2006
and inserting
2008
.
Effective date
The amendments made by subsection (a) shall apply to property placed in service after December 31, 2005.
Cover over of tax on distilled spirits
In general
Section 7652(f)(1) is amended by striking
2006
and inserting 2008
.
Effective date
The amendment made by subsection (a) shall apply to articles brought into the United States after December 31, 2005.
Parity in application of certain limits to mental health benefits
Amendment to the Internal Revenue Code of 1986
Section 9812(f)(3) is amended by striking ‘‘2006’’ and inserting ‘‘2007’’.
Amendment to the Employee Retirement Income Security Act of 1974
Section 712(f) of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1185a(f)) is amended by striking ‘‘2006’’ and inserting ‘‘2007’’.
Amendment to the Public Health Service Act
Section 2705(f) of the Public Health Service Act (42 U.S.C. 300gg–5(f)) is amended by striking ‘‘2006’’and inserting ‘‘2007’’.
Corporate donations of scientific property used for research and of computer technology and equipment
Extension of computer technology and equipment donation
In general
Section 170(e)(6)(G) is amended by striking
2005
and inserting 2007
.
Effective date
The amendment made by paragraph (1) shall apply to contributions made in taxable years beginning after December 31, 2005.
Expansion of charitable contribution allowed for scientific property used for research and for computer technology and equipment used for educational purposes
Scientific property used for research
In general
Clause (ii) of section 170(e)(4)(B) (defining qualified
research contributions) is amended by inserting or assembled
after constructed
.
Conforming amendment
Clause (iii) of section 170(e)(4)(B) is amended by
inserting or assembly
after construction
.
Computer technology and equipment for educational purposes
In general
Clause (ii) of section 170(e)(6)(B) is amended by
inserting or assembled
after constructed
and
or assembling
after construction
.
Conforming amendment
Subparagraph (D) of section 170(e)(6) is amended by
inserting or assembled
after constructed
and
or assembly
after construction
.
Effective date
The amendments made by this subsection shall apply to taxable years beginning after December 31, 2005.
Availability of medical savings accounts
In general
Paragraphs (2) and (3)(B) of section 220(i) are each
amended by striking 2005
each place it appears in the text and
headings and inserting 2007
.
Conforming amendments
Paragraph (2) of section 220(j) is amended—
in the text by
striking or 2004
each place it appears and inserting
2004, 2005, or 2006
, and
in the heading by
striking or
2004
and inserting
2004,
2005, or
2006
.
Subparagraph (A)
of section 220(j)(4) is amended by striking and 2004
and
inserting 2004, 2005, and 2006
.
Time for filing reports, etc
The report required by section 220(j)(4) of the Internal Revenue Code of 1986 to be made on August 1, 2005, or August 1, 2006, as the case may be, shall be treated as timely if made before the close of the 90-day period beginning on the date of the enactment of this Act.
The determination and publication required by section 220(j)(5) of such Code with respect to calendar year 2005 or calendar year 2006, as the case may be, shall be treated as timely if made before the close of the 120-day period beginning on the date of the enactment of this Act. If the determination under the preceding sentence is that 2005 or 2006 is a cut-off year under section 220(i) of such Code, the cut-off date under such section 220(i) shall be the last day of such 120-day period.
Taxable income limit on percentage depletion for oil and natural gas produced from marginal properties
In general
Section 613A(c)(6)(H) is amended by striking
2006
and inserting 2008
.
Effective date
The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 2005.
American Samoa economic development credit
In general
For purposes of section 30A of the Internal Revenue Code of 1986, a domestic corporation shall be treated as a qualified domestic corporation to which such section applies if such corporation—
is an existing credit claimant with respect to American Samoa, and
elected the application of section 936 of the Internal Revenue Code of 1986 for its last taxable year beginning before January 1, 2006.
Special rules for application of section
The following rules shall apply in applying section 30A of the Internal Revenue Code of 1986 for purposes of this section:
Amount of credit
Notwithstanding section 30A(a)(1) of such Code, the amount of the credit determined under section 30A(a)(1) of such Code for any taxable year shall be the amount determined under section 30A(d) of such Code, except that section 30A(d) shall be applied without regard to paragraph (3) thereof.
Separate application
In applying section 30A(a)(3) of such Code in the case of a corporation treated as a qualified domestic corporation by reason of this section, section 30A of such Code (and so much of section 936 of such Code as relates to such section 30A) shall be applied separately with respect to American Samoa.
Foreign tax credit allowed
Notwithstanding section 30A(e) of such Code, the provisions of section 936(c) of such Code shall not apply with respect to the credit allowed by reason of this section.
Definitions
For purposes of this section, any term which is used in this section which is also used in section 30A or 936 of such Code shall have the same meaning given such term by such section 30A or 936.
Application of section
Notwithstanding section 30A(h) or section 936(j) of such Code, this section (and so much of section 30A and section 936 of such Code as relates to this section) shall apply to the first two taxable years of a corporation to which subsection (a) applies which begin after December 31, 2005, and before January 1, 2008.
Extension of bonus depreciation for certain qualified Gulf Opportunity Zone property
In general
Subsection (d) of section 1400N is amended by adding at the end the following new paragraph:
Extension for certain property
In general
In the case of any specified Gulf Opportunity Zone extension property, paragraph (2)(A) shall be applied without regard to clause (v) thereof.
Specified gulf opportunity zone extension property
For purposes of this paragraph, the term specified Gulf Opportunity Zone extension property means property—
substantially all of the use of which is in one or more specified portions of the GO Zone, and
which is—
nonresidential real property or residential rental property which is placed in service by the taxpayer on or before December 31, 2010, or
in the case of a taxpayer who places a building described in subclause (I) in service on or before December 31, 2010, property described in section 168(k)(2)(A)(i) if substantially all of the use of such property is in such building and such property is placed in service by the taxpayer not later than 90 days after such building is placed in service.
Specified portions of the GO Zone
For purposes of this paragraph, the term specified portions of the GO Zone means those portions of the GO Zone which are in any county or parish which is identified by the Secretary as being a county or parish in which hurricanes occurring during 2005 damaged (in the aggregate) more than 60 percent of the housing units in such county or parish which were occupied (determined according to the 2000 Census).
Only pre-January 1, 2010, basis of real property eligible for additional allowance
In the case of property which is qualified Gulf Opportunity Zone property solely by reason of subparagraph (B)(ii)(I), paragraph (1) shall apply only to the extent of the adjusted basis thereof attributable to manufacture, construction, or production before January 1, 2010.
.
Extension not applicable to increased section 179 expensing
Paragraph (2) of
section 1400N(e) is amended by inserting without regard to subsection
(d)(6)
after subsection (d)(2)
.
Effective date
The amendments made by this section shall take effect as if included in section 101 of the Gulf Opportunity Zone Act of 2005.
Authority for undercover operations
Paragraph (6) of section 7608(c) (relating
to application of section) is amended by striking 2007
both
places it appears and inserting 2008
.
Disclosures of certain tax return information
Disclosures To facilitate combined employment tax reporting
In general
Subparagraph (B) of section 6103(d)(5) (relating to
termination) is amended by striking 2006
and inserting
2007
.
Effective date
The amendment made by paragraph (1) shall apply to disclosures after December 31, 2006.
Disclosures relating to terrorist activities
In general
Clause (iv) of section 6103(i)(3)(C) and subparagraph (E)
of section 6103(i)(7) are each amended by striking 2006
and
inserting 2007
.
Effective date
The amendments made by paragraph (1) shall apply to disclosures after December 31, 2006.
Disclosures relating to student loans
In general
Subparagraph (D) of section 6103(l)(13) (relating to
termination) is amended by striking 2006
and inserting
2007
.
Effective date
The amendment made by paragraph (1) shall apply to requests made after December 31, 2006.
Special rule for elections under expired provisions
Research credit elections
In the case of any taxable year ending after December 31, 2005, and before the date of the enactment of this Act, any election under section 41(c)(4) or section 280C(c)(3)(C) of the Internal Revenue Code of 1986 shall be treated as having been timely made for such taxable year if such election is made not later than the later of April 15, 2007, or such time as the Secretary of the Treasury, or his designee, may specify. Such election shall be made in the manner prescribed by such Secretary or designee.
Other elections
Except as otherwise provided by such Secretary or designee, a rule similar to the rule of subsection (a) shall apply with respect to elections under any other expired provision of the Internal Revenue Code of 1986 the applicability of which is extended by reason of the amendments made by this title.
Energy tax provisions
Credit for electricity produced from certain renewable resources
Subsection (d) of section 45 is amended by
striking January 1, 2008
each place it appears and inserting
January 1, 2009
.
Credit to holders of clean renewable energy bonds
In general
Section 54 is amended—
by
striking $800,000,000
in subsection (f)(1) and inserting
$1,200,000,000
,
by striking
$500,000,000
in subsection (f)(2) and inserting
$750,000,000
, and
by striking
December 31, 2007
in subsection (m) and inserting
December 31, 2008
.
Effective dates
In general
The amendments made by paragraphs (1) and (3) of subsection (a) shall apply to bonds issued after December 31, 2006.
Allocations
The amendment made by subsection (a)(2) shall apply to allocations or reallocations after December 31, 2006.
Performance standards for sulfur dioxide removal in advanced coal-based generation technology units designed to use subbituminous coal
In General
Paragraph (1) of section 48A(f) (relating to advanced coal-based generation technology) is amended by adding at the end the following new flush sentence:
For purposes of the performance requirement specified for the removal of SO2 in the table contained in subparagraph (B), the SO2 removal design level in the case of a unit designed for the use of feedstock substantially all of which is subbituminous coal shall be 99 percent SO2 removal or the achievement of an emission level of 0.04 pounds or less of SO2 per million Btu, determined on a 30-day average.
.
Effective Date
The amendment made by this section shall take apply with respect to applications for certification under section 48A(d)(2) of the Internal Revenue Code of 1986 submitted after October 2, 2006.
Deduction for energy efficient commercial buildings
Subsection (h) of section 179D is amended by
striking December 31, 2007
and inserting December 31,
2008
.
Credit for new energy efficient homes
Subsection (g) of section 45L is amended by
striking December 31, 2007
and inserting December 31,
2008
.
Credit for residential energy efficient property
Extension
Subsection (g) of section 25D is amended by
striking December 31, 2007
and inserting December 31,
2008
.
Clarification of term
Subsections
(a)(1), (b)(1)(A), and (e)(4)(A)(i) of section 25D are each amended by striking
qualified photovoltaic property expenditures
and inserting
qualified solar electric property expenditures
.
Section 25D(d)(2) is amended—
by striking
qualified photovoltaic property expenditure
and inserting
qualified solar electric property expenditure
, and
in the heading by striking
qualified photovoltaic
property expenditure
and inserting
qualified solar electric
property expenditure
.
Energy credit
Section 48 is amended—
by striking
January 1, 2008
both places it appears and inserting
January 1, 2009
, and
by striking
December 31, 2007
both places it appears and inserting
December 31, 2008
.
Special rule for qualified methanol or ethanol fuel
Extension
Subparagraph (D) of section 4041(b)(2) is
amended by striking October 1, 2007
and inserting January
1, 2009
.
Applicable blender rate
Section 4041(b)(2)(C)(ii) is amended by striking
2007
and inserting 2008
.
Clerical amendment
The heading for section 4041(b)(2)(B) is amended to
read as follows: Qualified methanol and ethanol fuel produced from
coal
.
Special depreciation allowance for cellulosic biomass ethanol plant property
In general
Section 168 (relating to accelerated cost recovery system) is amended by adding at the end the following:
Special allowance for cellulosic biomass ethanol plant property
Additional allowance
In the case of any qualified cellulosic biomass ethanol plant property—
the depreciation deduction provided by section 167(a) for the taxable year in which such property is placed in service shall include an allowance equal to 50 percent of the adjusted basis of such property, and
the adjusted basis of such property shall be reduced by the amount of such deduction before computing the amount otherwise allowable as a depreciation deduction under this chapter for such taxable year and any subsequent taxable year.
Qualified cellulosic biomass ethanol plant property
The term qualified cellulosic biomass ethanol plant property means property of a character subject to the allowance for depreciation—
which is used in the United States solely to produce cellulosic biomass ethanol,
the original use of which commences with the taxpayer after the date of the enactment of this subsection,
which is acquired by the taxpayer by purchase (as defined in section 179(d)) after the date of the enactment of this subsection, but only if no written binding contract for the acquisition was in effect on or before the date of the enactment of this subsection, and
which is placed in service by the taxpayer before January 1, 2013.
Cellulosic biomass ethanol
For purposes of this subsection, the term cellulosic biomass ethanol means ethanol produced by enzymatic hydrolysis of any lignocellulosic or hemicellulosic matter that is available on a renewable or recurring basis.
Exceptions
Alternative depreciation property
Such term shall not include any property described in section 168(k)(2)(D)(i).
Tax-exempt bond-financed property
Such term shall not include any property any portion of which is financed with the proceeds of any obligation the interest on which is exempt from tax under section 103.
Election Out
If a taxpayer makes an election under this subparagraph with respect to any class of property for any taxable year, this subsection shall not apply to all property in such class placed in service during such taxable year.
Special Rules
For purposes of this subsection, rules similar to the rules of subparagraph (E) of section 168(k)(2) shall apply, except that such subparagraph shall be applied—
by substituting
the date of the enactment of subsection (l)
for September
10, 2001
each place it appears therein,
by substituting
January 1, 2013
for January 1, 2005
in clause (i)
thereof, and
by substituting qualified cellulosic
biomass ethanol plant property
for qualified property
in
clause (iv) thereof.
Allowance against alternative minimum tax
For purposes of this subsection, rules similar to the rules of section 168(k)(2)(G) shall apply.
Recapture
For purposes of this subsection, rules similar to the rules under section 179(d)(10) shall apply with respect to any qualified cellulosic biomass ethanol plant property which ceases to be qualified cellulosic biomass ethanol plant property.
Denial of double benefit
Paragraph (1) shall not apply to any qualified cellulosic biomass ethanol plant property with respect to which an election has been made under section 179C (relating to election to expense certain refineries).
.
Effective date
The amendment made by this section shall apply to property placed in service after the date of the enactment of this Act in taxable years ending after such date.
Expenditures permitted from the Leaking Underground Storage Tank Trust Fund
In general
Subsection (c) of section 9508 is amended—
by striking
section 9003(h)
and inserting sections 9003(h), 9003(i),
9003(j), 9004(f), 9005(c), 9010, 9011, 9012, and 9013
, and
by striking
Superfund Amendments and Reauthorization Act of 1986
and
inserting Public Law 109–168
.
Conforming amendments
Section 9014(2) of the Solid Waste Disposal Act is
amended by striking Fund, notwithstanding section 9508(c)(1) of the
Internal Revenue Code of 1986
and inserting Fund
.
Effective date
The amendments made by this section shall take effect on the date of the enactment of this Act.
Treatment of coke and coke gas
Nonapplication of phaseout
Section 45K(g)(2) is amended by adding at the end the following new subparagraph:
Nonapplication of phaseout
Subsection (b)(1) shall not apply.
.
Clarification of qualifying facility
Section 45K(g)(1) is amended by inserting
(other than from petroleum based products)
after coke or
coke gas
.
Effective date
The amendments made by this section shall take effect as if included in section 1321 of the Energy Policy Act of 2005.
Health Savings Accounts
Short title
This title may be cited
as the Health Opportunity Patient
Empowerment Act of 2006
.
FSA and HRA terminations to fund HSAs
In general
Section 106 (relating to contributions by employer to accident and health plans) is amended by adding at the end the following new subsection:
FSA and HRA terminations to fund HSAs
In general
A plan shall not fail to be treated as a health flexible spending arrangement or health reimbursement arrangement under this section or section 105 merely because such plan provides for a qualified HSA distribution.
Qualified HSA distribution
The term qualified HSA distribution means a distribution from a health flexible spending arrangement or health reimbursement arrangement to the extent that such distribution—
does not exceed the lesser of the balance in such arrangement on September 21, 2006, or as of the date of such distribution, and
is contributed by the employer directly to the health savings account of the employee before January 1, 2012.
Additional tax for failure to maintain high deductible health plan coverage
In general
If, at any time during the testing period, the employee is not an eligible individual, then the amount of the qualified HSA distribution—
shall be includible in the gross income of the employee for the taxable year in which occurs the first month in the testing period for which such employee is not an eligible individual, and
the tax imposed by this chapter for such taxable year on the employee shall be increased by 10 percent of the amount which is so includible.
Exception for disability or death
Clauses (i) and (ii) of subparagraph (A) shall not apply if the employee ceases to be an eligible individual by reason of the death of the employee or the employee becoming disabled (within the meaning of section 72(m)(7)).
Definitions and special rules
For purposes of this subsection—
Testing period
The term testing period means the period beginning with the month in which the qualified HSA distribution is contributed to the health savings account and ending on the last day of the 12th month following such month.
Eligible individual
The term eligible individual has the meaning given such term by section 223(c)(1).
Treatment as rollover contribution
A qualified HSA distribution shall be treated as a rollover contribution described in section 223(f)(5).
Tax treatment relating to distributions
For purposes of this title—
In general
A qualified HSA distribution shall be treated as a payment described in subsection (d).
Comparability excise tax
In general
Except as provided in clause (ii), section 4980G shall not apply to qualified HSA distributions.
Failure to offer to all employees
In the case of a qualified HSA distribution to any employee, the failure to offer such distribution to any eligible individual covered under a high deductible health plan of the employer shall (notwithstanding section 4980G(d)) be treated for purposes of section 4980G as a failure to meet the requirements of section 4980G(b).
.
Certain FSA coverage disregarded coverage
Subparagraph (B) of section
223(c)(1) (relating to certain coverage disregarded) is amended by striking
and
at the end of clause (i), by striking the period at the end
of clause (ii) and inserting , and
, and by inserting after
clause (ii) the following new clause:
for taxable years beginning after December 31, 2006, coverage under a health flexible spending arrangement during any period immediately following the end of a plan year of such arrangement during which unused benefits or contributions remaining at the end of such plan year may be paid or reimbursed to plan participants for qualified benefit expenses incurred during such period if—
the balance in such arrangement at the end of such plan year is zero, or
the individual is making a qualified HSA distribution (as defined in section 106(e)) in an amount equal to the remaining balance in such arrangement as of the end of such plan year, in accordance with rules prescribed by the Secretary.
.
Application of section
Subsection (a)
The amendment made by subsection (a) shall apply to distributions on or after the date of the enactment of this Act.
Subsection (b)
The amendment made by subsection (b) shall take effect on the date of the enactment of this Act.
Repeal of annual deductible limitation on HSA contributions
In general
Paragraph (2) of section 223(b) (relating to monthly limitation) is amended—
in subparagraph
(A) by striking the lesser of—
and all that follows and
inserting $2,250.
, and
in subparagraph (B) by striking the
lesser of—
and all that follows and inserting
$4,500.
.
Conforming amendment
Section 223(d)(1)(A)(ii)(I) is amended by striking
subsection (b)(2)(B)(ii)
and inserting subsection
(b)(2)(B)
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2006.
Modification of cost-of-living adjustment
Paragraph (1) of section 223(g) (relating to cost-of-living adjustment) is amended by adding at the end the following new flush sentence:
In the
case of adjustments made for any taxable year beginning after 2007, section
1(f)(4) shall be applied for purposes of this paragraph by substituting
March 31
for August 31
, and the Secretary shall
publish the adjusted amounts under subsections (b)(2) and (c)(2)(A) for taxable
years beginning in any calendar year no later than June 1 of the preceding
calendar
year.
.
Contribution limitation not reduced for part-year coverage
Increase in limit for individuals becoming eligible individuals after beginning of the year
Subsection (b) of section 223 (relating to limitations) is amended by adding at the end the following new paragraph:
Increase in limit for individuals becoming eligible individuals after the beginning of the year
In general
For purposes of computing the limitation under paragraph (1) for any taxable year, an individual who is an eligible individual during the last month of such taxable year shall be treated—
as having been an eligible individual during each of the months in such taxable year, and
as having been enrolled, during each of the months such individual is treated as an eligible individual solely by reason of clause (i), in the same high deductible health plan in which the individual was enrolled for the last month of such taxable year.
Failure to maintain high deductible health plan coverage
In general
If, at any time during the testing period, the individual is not an eligible individual, then—
gross income of the individual for the taxable year in which occurs the first month in the testing period for which such individual is not an eligible individual is increased by the aggregate amount of all contributions to the health savings account of the individual which could not have been made but for subparagraph (A), and
the tax imposed by this chapter for any taxable year on the individual shall be increased by 10 percent of the amount of such increase.
Exception for disability or death
Subclauses (I) and (II) of clause (i) shall not apply if the individual ceased to be an eligible individual by reason of the death of the individual or the individual becoming disabled (within the meaning of section 72(m)(7)).
Testing period
The term testing period means the period beginning with the last month of the taxable year referred to in subparagraph (A) and ending on the last day of the 12th month following such month.
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2006.
Exception to requirement for employers to make comparable health savings account contributions
In general
Section 4980G (relating to failure of employer to make comparable health savings account contributions) is amended by adding at the end the following new subsection:
Exception
For purposes of applying section 4980E to a contribution to a health savings account of an employee who is not a highly compensated employee (as defined in section 414(q)), highly compensated employees shall not be treated as comparable participating employees.
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2006.
One-time distribution from individual retirement plans to fund HSAs
In general
Subsection (d) of section 408 (relating to taxability of beneficiary of employees’ trust) is amended by adding at the end the following new paragraph:
Distribution for health savings account funding
In general
In the case of an individual who is an eligible individual (as defined in section 223(c)) and who elects the application of this paragraph for a taxable year, gross income of the individual for the taxable year does not include a qualified HSA funding distribution to the extent such distribution is otherwise includible in gross income.
Qualified HSA funding distribution
For purposes of this paragraph, the term qualified HSA funding distribution means a distribution from an individual retirement plan (other than a plan described in subsection (k) or (p)) of the employee to the extent that such distribution is contributed to the health savings account of the individual in a direct trustee-to-trustee transfer.
Limitations
Maximum dollar limitation
The amount excluded from gross income by subparagraph (A) shall not exceed the excess of—
the annual limitation under section 223(b) computed on the basis of the type of coverage under the high deductible health plan covering the individual at the time of the qualified HSA funding distribution, over
in the case of a distribution described in clause (ii)(II), the amount of the earlier qualified HSA funding distribution.
One-time transfer
In general
Except as provided in subclause (II), an individual may make an election under subparagraph (A) only for one qualified HSA funding distribution during the lifetime of the individual. Such an election, once made, shall be irrevocable.
Conversion from self-only to family coverage
If a qualified HSA funding distribution is made during a month in a taxable year during which an individual has self-only coverage under a high deductible health plan as of the first day of the month, the individual may elect to make an additional qualified HSA funding distribution during a subsequent month in such taxable year during which the individual has family coverage under a high deductible health plan as of the first day of the subsequent month.
Failure to maintain high deductible health plan coverage
In general
If, at any time during the testing period, the individual is not an eligible individual, then the aggregate amount of all contributions to the health savings account of the individual made under subparagraph (A)—
shall be includible in the gross income of the individual for the taxable year in which occurs the first month in the testing period for which such individual is not an eligible individual, and
the tax imposed by this chapter for any taxable year on the individual shall be increased by 10 percent of the amount which is so includible.
Exception for disability or death
Subclauses (I) and (II) of clause (i) shall not apply if the individual ceased to be an eligible individual by reason of the death of the individual or the individual becoming disabled (within the meaning of section 72(m)(7)).
Testing period
The term testing period means the period beginning with the month in which the qualified HSA funding distribution is contributed to a health savings account and ending on the last day of the 12th month following such month.
Application of section 72
Notwithstanding section 72, in determining the extent to which an amount is treated as otherwise includible in gross income for purposes of subparagraph (A), the aggregate amount distributed from an individual retirement plan shall be treated as includible in gross income to the extent that such amount does not exceed the aggregate amount which would have been so includible if all amounts from all individual retirement plans were distributed. Proper adjustments shall be made in applying section 72 to other distributions in such taxable year and subsequent taxable years.
.
Coordination with limitation on contributions to HSAs
Section 223(b)(4)
(relating to coordination with other contributions) is amended by striking
and
at the end of subparagraph (A), by striking the period at
the end of subparagraph (B) and inserting , and
, and by
inserting after subparagraph (B) the following new subparagraph:
the aggregate amount contributed to health savings accounts of such individual for such taxable year under section 408(d)(9) (and such amount shall not be allowed as a deduction under subsection (a)).
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2006.
Other Provisions
Deduction allowable with respect to income attributable to domestic production activities in Puerto Rico
In general
Subsection (d) of section 199 (relating to definitions and special rules) is amended by redesignating paragraph (8) as paragraph (9) and by inserting after paragraph (7) the following new paragraph:
Treatment of activities in Puerto Rico
In general
In the case of any taxpayer with gross receipts for any taxable year from sources within the Commonwealth of Puerto Rico, if all of such receipts are taxable under section 1 or 11 for such taxable year, then for purposes of determining the domestic production gross receipts of such taxpayer for such taxable year under subsection (c)(4), the term United States shall include the Commonwealth of Puerto Rico.
Special rule for applying wage limitation
In the case of any taxpayer described in subparagraph (A), for purposes of applying the limitation under subsection (b) for any taxable year, the determination of W–2 wages of such taxpayer shall be made without regard to any exclusion under section 3401(a)(8) for remuneration paid for services performed in Puerto Rico.
Termination
This paragraph shall apply only with respect to the first 2 taxable years of the taxpayer beginning after December 31, 2005, and before January 1, 2008.
.
Effective date
The amendments made by subsection (a) shall apply to taxable years beginning after December 31, 2005.
Credit for prior year minimum tax liability made refundable after period of years
In general
Section 53 (relating to credit for prior year minimum tax liability) is amended by adding at the end the following new subsection:
Special rule for individuals with long-term unused credits
In general
If an individual has a long-term unused minimum tax credit for any taxable year beginning before January 1, 2013, the amount determined under subsection (c) for such taxable year shall not be less than the AMT refundable credit amount for such taxable year.
Amt refundable credit amount
For purposes of paragraph (1)—
In general
The term AMT refundable credit amount means, with respect to any taxable year, the amount equal to the greater of—
the lesser of—
$5,000, or
the amount of long-term unused minimum tax credit for such taxable year, or
20 percent of the amount of such credit.
Phaseout of amt refundable credit amount
In general
In the case of an individual whose adjusted gross income for any taxable year exceeds the threshold amount (within the meaning of section 151(d)(3)(C)), the AMT refundable credit amount determined under subparagraph (A) for such taxable year shall be reduced by the applicable percentage (within the meaning of section 151(d)(3)(B)).
Adjusted gross income
For purposes of clause (i), adjusted gross income shall be determined without regard to sections 911, 931, and 933.
Long-term unused minimum tax credit
In general
For purposes of this subsection, the term long-term unused minimum tax credit means, with respect to any taxable year, the portion of the minimum tax credit determined under subsection (b) attributable to the adjusted net minimum tax for taxable years before the 3rd taxable year immediately preceding such taxable year.
First-in, first-out ordering rule
For purposes of subparagraph (A), credits shall be treated as allowed under subsection (a) on a first-in, first-out basis.
Credit refundable
For purposes of this title (other than this section), the credit allowed by reason of this subsection shall be treated as if it were allowed under subpart C.
.
Conforming amendments
Section
6211(b)(4)(A) is amended by striking and 34
and inserting
34, and 53(e)
.
Paragraph (2) of
section 1324(b) of title 31, United States Code, is amended by inserting
or 53(e)
after section 35
.
Effective date
The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Returns required in connection with certain options
In general
So much of section 6039(a) as follows paragraph (2) is amended to read as follows:
shall, for such calendar year, make a return at such time and in such manner, and setting forth such information, as the Secretary may by regulations prescribe.
.
Statements to persons with respect to whom information is furnished
Section 6039 is amended by redesignating subsections (b) and (c) as subsection (c) and (d), respectively, and by inserting after subsection (a) the following new subsection:
Statements To be furnished to persons with respect to whom information is reported
Every corporation making a return under subsection (a) shall furnish to each person whose name is set forth in such return a written statement setting forth such information as the Secretary may by regulations prescribe. The written statement required under the preceding sentence shall be furnished to such person on or before January 31 of the year following the calendar year for which the return under subsection (a) was made.
.
Conforming amendments
Section
6724(d)(1)(B) is amended by striking or
at the end of clause
(xvii), by striking and
at the end of clause (xviii) and
inserting or
, and by adding at the end the following new
clause:
section 6039(a) (relating to returns required with respect to certain options), and
.
Section
6724(d)(2)(B) is amended by striking section 6039(a)
and
inserting section 6039(b)
.
The heading of
section 6039 and the item relating to such section in the table of sections of
subpart A of part III of subchapter A of chapter 61 of such Code are each
amended by striking Information
and inserting
Returns
.
The heading of
subsection (a) of section 6039 is amended by striking Furnishing of
information
and inserting Requirement of reporting
.
Effective date
The amendments made by this section shall apply to calendar years beginning after the date of the enactment of this Act.
Partial expensing for advanced mine safety equipment
In general
Part VI of subchapter B of chapter 1 is amended by inserting after section 179D the following new section:
Election to expense advanced mine safety equipment
Treatment as expenses
A taxpayer may elect to treat 50 percent of the cost of any qualified advanced mine safety equipment property as an expense which is not chargeable to capital account. Any cost so treated shall be allowed as a deduction for the taxable year in which the qualified advanced mine safety equipment property is placed in service.
Election
In General
An election under this section for any taxable year shall be made on the taxpayer’s return of the tax imposed by this chapter for the taxable year. Such election shall specify the advanced mine safety equipment property to which the election applies and shall be made in such manner as the Secretary may by regulations prescribe.
Election irrevocable
Any election made under this section may not be revoked except with the consent of the Secretary.
Qualified advanced mine safety equipment property
For purposes of this section, the term qualified advanced mine safety equipment property means any advanced mine safety equipment property for use in any underground mine located in the United States—
the original use of which commences with the taxpayer, and
which is placed in service by the taxpayer after the date of the enactment of this section.
Advanced mine safety equipment property
For purposes of this section, the term advanced mine safety equipment property means any of the following:
Emergency communication technology or device which is used to allow a miner to maintain constant communication with an individual who is not in the mine.
Electronic identification and location device which allows an individual who is not in the mine to track at all times the movements and location of miners working in or at the mine.
Emergency oxygen-generating, self-rescue device which provides oxygen for at least 90 minutes.
Pre-positioned supplies of oxygen which (in combination with self-rescue devices) can be used to provide each miner on a shift, in the event of an accident or other event which traps the miner in the mine or otherwise necessitates the use of such a self-rescue device, the ability to survive for at least 48 hours.
Comprehensive atmospheric monitoring system which monitors the levels of carbon monoxide, methane, and oxygen that are present in all areas of the mine and which can detect smoke in the case of a fire in a mine.
Coordination with section 179
No expenditures shall be taken into account under subsection (a) with respect to the portion of the cost of any property specified in an election under section 179.
Reporting
No deduction shall be allowed under subsection (a) to any taxpayer for any taxable year unless such taxpayer files with the Secretary a report containing such information with respect to the operation of the mines of the taxpayer as the Secretary shall require.
Termination
This section shall not apply to property placed in service after December 31, 2008.
.
Conforming amendments
Section 263(a)(1)
is amended by striking or
at the end of subparagraph (J), by
striking the period at the end of subparagraph (K) and inserting ,
or
, and by inserting after subparagraph (K) the following new
subparagraph:
expenditures for which a deduction is allowed under section 179E.
.
Section
312(k)(3)(B) is amended by striking or 179D
each place it
appears in the heading and text thereof and inserting 179D, or
179E
.
Paragraphs (2)(C)
and (3)(C) of section 1245(a) are each amended by inserting
179E,
after 179D,
.
The table of sections for part VI of subchapter B of chapter 1 is amended by inserting after the item relating to section 179D the following new item:
Sec. 179E. Election to expense advanced mine safety equipment.
.
Effective date
The amendments made by this section shall apply to costs paid or incurred after the date of the enactment of this Act.
Mine rescue team training tax credit
In General
Subpart D of part IV of subchapter A of chapter 1 (relating to business related credits) is amended by adding at the end the following new section:
Mine rescue team training credit
Amount of credit
For purposes of section 38, the mine rescue team training credit determined under this section with respect to each qualified mine rescue team employee of an eligible employer for any taxable year is an amount equal to the lesser of—
20 percent of the amount paid or incurred by the taxpayer during the taxable year with respect to the training program costs of such qualified mine rescue team employee (including wages of such employee while attending such program), or
$10,000.
Qualified mine rescue team employee
For purposes of this section, the term qualified mine rescue team employee means with respect to any taxable year any full-time employee of the taxpayer who is—
a miner eligible for more than 6 months of such taxable year to serve as a mine rescue team member as a result of completing, at a minimum, an initial 20-hour course of instruction as prescribed by the Mine Safety and Health Administration’s Office of Educational Policy and Development, or
a miner eligible for more than 6 months of such taxable year to serve as a mine rescue team member by virtue of receiving at least 40 hours of refresher training in such instruction.
Eligible employer
For purposes of this section, the term eligible employer means any taxpayer which employs individuals as miners in underground mines in the United States.
Wages
For purposes of this section, the term wages has the meaning given to such term by subsection (b) of section 3306 (determined without regard to any dollar limitation contained in such section).
Termination
This section shall not apply to taxable years beginning after December 31, 2008.
.
Credit made part of general business credit
Section 38(b) is amended by striking
and
at the end of paragraph (29), by striking the period at the
end of paragraph (30) and inserting , plus
, and by adding at the
end the following new paragraph:
the mine rescue team training credit determined under section 45N(a).
.
No double benefit
Section 280C is amended by adding at the end the following new subsection:
Mine rescue team training credit
No deduction shall be allowed for that portion of the expenses otherwise allowable as a deduction for the taxable year which is equal to the amount of the credit determined for the taxable year under section 45N(a).
.
Clerical amendment
The table of sections for subpart D of part IV of subchapter A of chapter 1 is amended by adding at the end the following new item:
Sec. 45N. Mine rescue team training credit.
.
Effective date
The amendments made by this section shall apply to taxable years beginning after December 31, 2005.
Whistleblower reforms
Awards to whistleblowers
In general
Section 7623 (relating to expenses of detection of underpayments and fraud, etc.) is amended—
by striking
The Secretary
and inserting (a)
In general.—The
Secretary
,
by striking
and
at the end of paragraph (1) and inserting
or
,
by striking
(other than interest)
, and
by adding at the end the following new subsection:
Awards to whistleblowers
In general
If the Secretary proceeds with any administrative or judicial action described in subsection (a) based on information brought to the Secretary’s attention by an individual, such individual shall, subject to paragraph (2), receive as an award at least 15 percent but not more than 30 percent of the collected proceeds (including penalties, interest, additions to tax, and additional amounts) resulting from the action (including any related actions) or from any settlement in response to such action. The determination of the amount of such award by the Whistleblower Office shall depend upon the extent to which the individual substantially contributed to such action.
Award in case of less substantial contribution
In general
In the event the action described in paragraph (1) is one which the Whistleblower Office determines to be based principally on disclosures of specific allegations (other than information provided by the individual described in paragraph (1)) resulting from a judicial or administrative hearing, from a governmental report, hearing, audit, or investigation, or from the news media, the Whistleblower Office may award such sums as it considers appropriate, but in no case more than 10 percent of the collected proceeds (including penalties, interest, additions to tax, and additional amounts) resulting from the action (including any related actions) or from any settlement in response to such action, taking into account the significance of the individual’s information and the role of such individual and any legal representative of such individual in contributing to such action.
Nonapplication of paragraph where individual is original source of information
Subparagraph (A) shall not apply if the information resulting in the initiation of the action described in paragraph (1) was originally provided by the individual described in paragraph (1).
Reduction in or denial of award
If the Whistleblower Office determines that the claim for an award under paragraph (1) or (2) is brought by an individual who planned and initiated the actions that led to the underpayment of tax or actions described in subsection (a)(2), then the Whistleblower Office may appropriately reduce such award. If such individual is convicted of criminal conduct arising from the role described in the preceding sentence, the Whistleblower Office shall deny any award.
Appeal of award determination
Any determination regarding an award under paragraph (1), (2), or (3) may, within 30 days of such determination, be appealed to the Tax Court (and the Tax Court shall have jurisdiction with respect to such matter).
Application of this subsection
This subsection shall apply with respect to any action—
against any taxpayer, but in the case of any individual, only if such individual’s gross income exceeds $200,000 for any taxable year subject to such action, and
if the tax, penalties, interest, additions to tax, and additional amounts in dispute exceed $2,000,000.
Additional rules
No contract necessary
No contract with the Internal Revenue Service is necessary for any individual to receive an award under this subsection.
Representation
Any individual described in paragraph (1) or (2) may be represented by counsel.
Submission of information
No award may be made under this subsection based on information submitted to the Secretary unless such information is submitted under penalty of perjury.
.
Assignment to special trial judges
In general
Section 7443A(b) (relating to proceedings which may be
assigned to special trial judges) is amended by striking and
at
the end of paragraph (5), by redesignating paragraph (6) as paragraph (7), and
by inserting after paragraph (5) the following new paragraph:
any proceeding under section 7623(b)(4), and
.
Conforming amendment
Section 7443A(c) is amended by striking or
(5)
and inserting (5), or (6)
.
Deduction allowed whether or not taxpayer itemizes
Subsection (a) of section 62 (relating to general rule defining adjusted gross income) is amended by inserting after paragraph (20) the following new paragraph:
Attorneys fees relating to awards to whistleblowers
Any deduction allowable under this chapter for attorney fees and court costs paid by, or on behalf of, the taxpayer in connection with any award under section 7623(b) (relating to awards to whistleblowers). The preceding sentence shall not apply to any deduction in excess of the amount includible in the taxpayer’s gross income for the taxable year on account of such award.
.
Whistleblower Office
In general
Not later than the date which is 12 months after the date
of the enactment of this Act, the Secretary of the Treasury shall issue
guidance for the operation of a whistleblower program to be administered in the
Internal Revenue Service by an office to be known as the Whistleblower
Office
which—
shall at all times operate at the direction of the Commissioner of Internal Revenue and coordinate and consult with other divisions in the Internal Revenue Service as directed by the Commissioner of Internal Revenue,
shall analyze information received from any individual described in section 7623(b) of the Internal Revenue Code of 1986 and either investigate the matter itself or assign it to the appropriate Internal Revenue Service office, and
in its sole discretion, may ask for additional assistance from such individual or any legal representative of such individual.
Request for assistance
The guidance issued under paragraph (1) shall specify that any assistance requested under paragraph (1)(C) shall be under the direction and control of the Whistleblower Office or the office assigned to investigate the matter under paragraph (1)(A). No individual or legal representative whose assistance is so requested may by reason of such request represent himself or herself as an employee of the Federal Government.
Report by Secretary
The Secretary of the Treasury shall each year conduct a study and report to Congress on the use of section 7623 of the Internal Revenue Code of 1986, including—
an analysis of the use of such section during the preceding year and the results of such use, and
any legislative or administrative recommendations regarding the provisions of such section and its application.
Effective date
The amendments made by subsection (a) shall apply to information provided on or after the date of the enactment of this Act.
Frivolous tax submissions
Civil penalties
Section 6702 is amended to read as follows:
Frivolous tax submissions
Civil penalty for frivolous tax returns
A person shall pay a penalty of $5,000 if—
such person files what purports to be a return of a tax imposed by this title but which—
does not contain information on which the substantial correctness of the self-assessment may be judged, or
contains information that on its face indicates that the self-assessment is substantially incorrect, and
the conduct referred to in paragraph (1)—
is based on a position which the Secretary has identified as frivolous under subsection (c), or
reflects a desire to delay or impede the administration of Federal tax laws.
Civil penalty for specified frivolous submissions
Imposition of penalty
Except as provided in paragraph (3), any person who submits a specified frivolous submission shall pay a penalty of $5,000.
Specified frivolous submission
For purposes of this section—
Specified frivolous submission
The term specified frivolous submission means a specified submission if any portion of such submission—
is based on a position which the Secretary has identified as frivolous under subsection (c), or
reflects a desire to delay or impede the administration of Federal tax laws.
Specified submission
The term specified submission means—
a request for a hearing under—
section 6320 (relating to notice and opportunity for hearing upon filing of notice of lien), or
section 6330 (relating to notice and opportunity for hearing before levy), and
an application under—
section 6159 (relating to agreements for payment of tax liability in installments),
section 7122 (relating to compromises), or
section 7811 (relating to taxpayer assistance orders).
Opportunity to withdraw submission
If the Secretary provides a person with notice that a submission is a specified frivolous submission and such person withdraws such submission within 30 days after such notice, the penalty imposed under paragraph (1) shall not apply with respect to such submission.
Listing of frivolous positions
The Secretary shall prescribe (and periodically revise) a list of positions which the Secretary has identified as being frivolous for purposes of this subsection. The Secretary shall not include in such list any position that the Secretary determines meets the requirement of section 6662(d)(2)(B)(ii)(II).
Reduction of penalty
The Secretary may reduce the amount of any penalty imposed under this section if the Secretary determines that such reduction would promote compliance with and administration of the Federal tax laws.
Penalties in addition to other penalties
The penalties imposed by this section shall be in addition to any other penalty provided by law.
.
Treatment of frivolous requests for hearings before levy
Frivolous requests disregarded
Section 6330 (relating to notice and opportunity for hearing before levy) is amended by adding at the end the following new subsection:
Frivolous requests for hearing, etc
Notwithstanding any other provision of this section, if the Secretary determines that any portion of a request for a hearing under this section or section 6320 meets the requirement of clause (i) or (ii) of section 6702(b)(2)(A), then the Secretary may treat such portion as if it were never submitted and such portion shall not be subject to any further administrative or judicial review.
.
Preclusion from raising frivolous issues at hearing
Section 6330(c)(4) is amended—
by striking
(A)
and inserting (A)(i)
;
by striking
(B)
and inserting (ii)
;
by striking the
period at the end of the first sentence and inserting ; or
;
and
by inserting after subparagraph (A)(ii) (as so redesignated) the following:
the issue meets the requirement of clause (i) or (ii) of section 6702(b)(2)(A).
.
Statement of grounds
Section 6330(b)(1) is amended by striking under
subsection (a)(3)(B)
and inserting in writing under subsection
(a)(3)(B) and states the grounds for the requested hearing
.
Treatment of frivolous requests for hearings upon filing of notice of lien
Section 6320 is amended—
in
subsection (b)(1), by striking under subsection (a)(3)(B)
and
inserting in writing under subsection (a)(3)(B) and states the grounds
for the requested hearing
, and
in subsection (c),
by striking and (e)
and inserting (e), and
(g)
.
Treatment of frivolous applications for offers-in-compromise and installment agreements
Section 7122 is amended by adding at the end the following new subsection:
Frivolous submissions, etc
Notwithstanding any other provision of this section, if the Secretary determines that any portion of an application for an offer-in-compromise or installment agreement submitted under this section or section 6159 meets the requirement of clause (i) or (ii) of section 6702(b)(2)(A), then the Secretary may treat such portion as if it were never submitted and such portion shall not be subject to any further administrative or judicial review.
.
Clerical amendment
The table of sections for part I of subchapter B of chapter 68 is amended by striking the item relating to section 6702 and inserting the following new item:
Sec. 6702. Frivolous tax submissions.
.
Effective date
The amendments made by this section shall apply to submissions made and issues raised after the date on which the Secretary first prescribes a list under section 6702(c) of the Internal Revenue Code of 1986, as amended by subsection (a).
Addition of meningococcal and human papillomavirus vaccines to list of taxable vaccines
Meningococcal vaccine
Section 4132(a)(1) (defining taxable vaccine) is amended by adding at the end the following new subparagraph:
Any meningococcal vaccine.
.
Human papillomavirus vaccine
Section 4132(a)(1), as amended by subsection (a), is amended by adding at the end the following new subparagraph:
Any vaccine against the human papillomavirus.
.
Effective date
Sales, etc
The amendments made by this section shall apply to sales and uses on or after the first day of the first month which begins more than 4 weeks after the date of the enactment of this Act.
Deliveries
For purposes of paragraph (1) and section 4131 of the Internal Revenue Code of 1986, in the case of sales on or before the effective date described in such paragraph for which delivery is made after such date, the delivery date shall be considered the sale date.
Clarification of taxation of certain settlement funds made permanent
In general
Subsection (g) of section 468B is amended by striking paragraph (3).
Effective date
The amendment made by this section shall take effect as if included in section 201 of the Tax Increase Prevention and Reconciliation Act of 2005.
Modification of active business definition under section 355 made permanent
In general
Subparagraphs (A) and
(D) of section 355(b)(3) are each amended by striking and on or before
December 31, 2010
.
Effective date
The amendments made by this section shall take effect as if included in section 202 of the Tax Increase Prevention and Reconciliation Act of 2005.
Revision of State veterans limit made permanent
In general
Subparagraph (B) of section 143(l)(3) is amended by striking clause (iv).
Effective date
The amendment made by this section shall take effect as if included in section 203 of the Tax Increase Prevention and Reconciliation Act of 2005.
Capital gains treatment for certain self-created musical works made permanent
In general
Paragraph (3) of
section 1221(b) is amended by striking before January 1,
2011,
.
Effective date
The amendment made by this section shall take effect as if included in section 204 of the Tax Increase Prevention and Reconciliation Act of 2005.
Reduction in minimum vessel tonnage which qualifies for tonnage tax made permanent
In general
Paragraph (4) of section 1355(a) is amended by striking
10,000 (6,000, in the case of taxable years beginning after December 31,
2005, and ending before January 1, 2011)
and inserting
6,000
.
Effective date
The amendment made by this section shall take effect as if included in section 205 of the Tax Increase Prevention and Reconciliation Act of 2005.
Modification of special arbitrage rule for certain funds made permanent
In general
Section 206 of the
Tax Increase Prevention and Reconciliation Act of 2005 is amended by striking
and before August 31, 2009
.
Effective date
The amendment made by this section shall take effect as if included in section 206 of the Tax Increase Prevention and Reconciliation Act of 2005.
Great Lakes domestic shipping to not disqualify vessel from tonnage tax
In general
Section 1355 (relating to definitions and special rules) is amended by redesignating subsection (g) as subsection (h) and by inserting after subsection (f) the following new subsection:
Great Lakes domestic shipping to not disqualify vessel
In general
If the electing corporation elects (at such time and in such manner as the Secretary may require) to apply this subsection for any taxable year to any qualifying vessel which is used in qualified zone domestic trade during the taxable year—
solely for purposes of subsection (a)(4), such use shall be treated as use in United States foreign trade (and not as use in United States domestic trade), and
subsection (f) shall not apply with respect to such vessel for such taxable year.
Effect of temporarily operating vessel in United States domestic trade
In the case of a qualifying vessel to which this subsection applies—
In general
An electing corporation shall be treated as using such vessel in qualified zone domestic trade during any period of temporary use in the United States domestic trade (other than qualified zone domestic trade) if the electing corporation gives timely notice to the Secretary stating—
that it temporarily operates or has operated in the United States domestic trade (other than qualified zone domestic trade) a qualifying vessel which had been used in the United States foreign trade or qualified zone domestic trade, and
its intention to resume operation of the vessel in the United States foreign trade or qualified zone domestic trade.
Notice
Notice shall be deemed timely if given not later than the due date (including extensions) for the corporation’s tax return for the taxable year in which the temporary cessation begins.
Period disregard in effect
The period of temporary use under subparagraph (A) continues until the earlier of the date of which—
the electing corporation abandons its intention to resume operations of the vessel in the United States foreign trade or qualified zone domestic trade, or
the electing corporation resumes operation of the vessel in the United States foreign trade or qualified zone domestic trade.
No disregard if domestic trade use exceeds 30 days
Subparagraph (A) shall not apply to any qualifying vessel which is operated in the United States domestic trade (other than qualified zone domestic trade) for more than 30 days during the taxable year.
Allocation of income and deductions to qualifying shipping activities
In the case of a qualifying vessel to which this subsection applies, the Secretary shall prescribe rules for the proper allocation of income, expenses, losses, and deductions between the qualified shipping activities and the other activities of such vessel.
Qualified zone domestic trade
For purposes of this subsection—
In general
The term qualified zone domestic trade means the transportation of goods or passengers between places in the qualified zone if such transportation is in the United States domestic trade.
Qualified zone
The term qualified zone means the Great Lakes Waterway and the St. Lawrence Seaway.
.
Effective date
The amendments made by this section shall apply to taxable years beginning after the date of the enactment of this Act.
Use of qualified mortgage bonds to finance residences for veterans without regard to first-time homebuyer requirement
In general
Section 143(d)(2)
(relating to exceptions to 3-year requirement) is amended by striking
and
at the end of subparagraph (B), by adding and
at the end of subparagraph (C), and by inserting after subparagraph (C) the
following new subparagraph:
in the case of bonds issued after the date of the enactment of this subparagraph and before January 1, 2008, financing of any residence for a veteran (as defined in section 101 of title 38, United States Code), if such veteran has not previously qualified for and received such financing by reason of this subparagraph,
.
Effective date
The amendments made by this section shall apply to bonds issued after the date of the enactment of this Act.
Exclusion of gain from sale of a principal residence by certain employees of the intelligence community
In general
Subparagraph (A) of section 121(d)(9) (relating to exclusion of gain from sale of principal residence) is amended by striking “duty” and all that follows and inserting “duty—
as a member of the uniformed services,
as a member of the Foreign Service of the United States, or
as an employee of the intelligence community.
.
Employee of intelligence community defined
Subparagraph (C) of section 121(d)(9) is amended by redesignating clause (iv) as clause (v) and by inserting after clause (iii) the following new clause:
Employee of intelligence community
The term employee of the intelligence community means an employee (as defined by section 2105 of title 5, United States Code) of—
the Office of the Director of National Intelligence,
the Central Intelligence Agency,
the National Security Agency,
the Defense Intelligence Agency,
the National Geospatial-Intelligence Agency,
the National Reconnaissance Office,
any other office within the Department of Defense for the collection of specialized national intelligence through reconnaissance programs,
any of the intelligence elements of the Army, the Navy, the Air Force, the Marine Corps, the Federal Bureau of Investigation, the Department of Treasury, the Department of Energy, and the Coast Guard,
the Bureau of Intelligence and Research of the Department of State, or
any of the elements of the Department of Homeland Security concerned with the analyses of foreign intelligence information.
.
Special rule
Subparagraph (C) of section 121(d)(9), as amended by subsection (b), is amended by adding at the end the following new clause:
Special rule relating to intelligence community
An employee of the intelligence community shall not be treated as serving on qualified extended duty unless such duty is at a duty station located outside the United States.
.
Conforming amendment
The heading for
section 121(d)(9) is amended to read as follows: Uniformed services, foreign service, and
intelligence community
.
Effective date
The amendments made by this section shall apply to sales or exchanges after the date of the enactment of this Act and before January 1, 2011.
Sale of property by judicial officers
In general
Section 1043(b) (relating to the sale of property to comply with conflict-of-interest requirements) is amended—
in paragraph (1)—
in subparagraph
(A), by inserting , or a judicial officer,
after an
officer or employee of the executive branch
; and
in subparagraph
(B), by inserting judicial canon,
after any statute,
regulation, rule,
;
in paragraph (2)—
in subparagraph
(A), by inserting judicial canon,
after any Federal
conflict of interest statute, regulation, rule,
; and
in subparagraph
(B), by inserting after the Director of the Office of Government
Ethics,
the following: in the case of executive branch officers
or employees, or by the Judicial Conference of the United States (or its
designee), in the case of judicial officers,
; and
in paragraph
(5)(B), by inserting judicial canon,
after any statute,
regulation, rule,
.
Judicial officer defined
Section 1043(b) is amended by adding at the end the following new paragraph:
Judicial officer
The term judicial officer means the Chief Justice of the United States, the Associate Justices of the Supreme Court, and the judges of the United States courts of appeals, United States district courts, including the district courts in Guam, the Northern Mariana Islands, and the Virgin Islands, Court of Appeals for the Federal Circuit, Court of International Trade, Tax Court, Court of Federal Claims, Court of Appeals for Veterans Claims, United States Court of Appeals for the Armed Forces, and any court created by Act of Congress, the judges of which are entitled to hold office during good behavior.
.
Effective date
The amendments made by this section shall apply to sales after the date of enactment of this Act.
Premiums for mortgage insurance
In general
Section 163(h)(3) (relating to qualified residence interest) is amended by adding at the end the following new subparagraph:
Mortgage insurance premiums treated as interest
In general
Premiums paid or accrued for qualified mortgage insurance by a taxpayer during the taxable year in connection with acquisition indebtedness with respect to a qualified residence of the taxpayer shall be treated for purposes of this section as interest which is qualified residence interest.
Phaseout
The amount otherwise treated as interest under clause (i) shall be reduced (but not below zero) by 10 percent of such amount for each $1,000 ($500 in the case of a married individual filing a separate return) (or fraction thereof) that the taxpayer’s adjusted gross income for the taxable year exceeds $100,000 ($50,000 in the case of a married individual filing a separate return).
Limitation
Clause (i) shall not apply with respect to any mortgage insurance contracts issued before January 1, 2007.
Termination
Clause (i) shall not apply to amounts—
paid or accrued after December 31, 2007, or
properly allocable to any period after such date.
.
Definition and special rules
Section 163(h)(4) (relating to other definitions and special rules) is amended by adding at the end the following new subparagraphs:
Qualified mortgage insurance
The term qualified mortgage insurance means—
mortgage insurance provided by the Veterans Administration, the Federal Housing Administration, or the Rural Housing Administration, and
private mortgage insurance (as defined by section 2 of the Homeowners Protection Act of 1998 (12 U.S.C. 4901), as in effect on the date of the enactment of this subparagraph).
Special rules for prepaid qualified mortgage insurance
Any amount paid by the taxpayer for qualified mortgage insurance that is properly allocable to any mortgage the payment of which extends to periods that are after the close of the taxable year in which such amount is paid shall be chargeable to capital account and shall be treated as paid in such periods to which so allocated. No deduction shall be allowed for the unamortized balance of such account if such mortgage is satisfied before the end of its term. The preceding sentences shall not apply to amounts paid for qualified mortgage insurance provided by the Veterans Administration or the Rural Housing Administration.
.
Information returns relating to mortgage insurance
Section 6050H (relating to returns relating to mortgage interest received in trade or business from individuals) is amended by adding at the end the following new subsection:
Returns relating to mortgage insurance premiums
In general
The Secretary may prescribe, by regulations, that any person who, in the course of a trade or business, receives from any individual premiums for mortgage insurance aggregating $600 or more for any calendar year, shall make a return with respect to each such individual. Such return shall be in such form, shall be made at such time, and shall contain such information as the Secretary may prescribe.
Statement to be furnished to individuals with respect to whom information is required
Every person required to make a return under paragraph (1) shall furnish to each individual with respect to whom a return is made a written statement showing such information as the Secretary may prescribe. Such written statement shall be furnished on or before January 31 of the year following the calendar year for which the return under paragraph (1) was required to be made.
Special rules
For purposes of this subsection—
rules similar to the rules of subsection (c) shall apply, and
the term mortgage insurance means—
mortgage insurance provided by the Veterans Administration, the Federal Housing Administration, or the Rural Housing Administration, and
private mortgage insurance (as defined by section 2 of the Homeowners Protection Act of 1998 (12 U.S.C. 4901), as in effect on the date of the enactment of this subsection).
.
Effective date
The amendments made by this section shall apply to amounts paid or accrued after December 31, 2006.
Modification of refunds for kerosene used in aviation
In general
Paragraph (4) of section 6427(l) (relating to nontaxable uses of diesel fuel and kerosene) is amended to read as follows:
Refunds for kerosene used in aviation
Kerosene used in commercial aviation
In the case of kerosene used in commercial aviation (as defined in section 4083(b)) (other than supplies for vessels or aircraft within the meaning of section 4221(d)(3)), paragraph (1) shall not apply to so much of the tax imposed by section 4041 or 4081, as the case may be, as is attributable to—
the Leaking Underground Storage Tank Trust Fund financing rate imposed by such section, and
so much of the rate of tax specified in section 4041(c) or 4081(a)(2)(A)(iii), as the case may be, as does not exceed 4.3 cents per gallon.
Kerosene used in noncommercial aviation
In the case of kerosene used in aviation that is not commercial aviation (as so defined) (other than any use which is exempt from the tax imposed by section 4041(c) other than by reason of a prior imposition of tax), paragraph (1) shall not apply to—
any tax imposed by subsection (c) or (d)(2) of section 4041, and
so much of the tax imposed by section 4081 as is attributable to—
the Leaking Underground Storage Tank Trust Fund financing rate imposed by such section, and
so much of the rate of tax specified in section 4081(a)(2)(A)(iii) as does not exceed the rate specified in section 4081(a)(2)(C)(ii).
Payments to ultimate, registered vendor
In general
With respect to any kerosene used in aviation (other than kerosene described in clause (ii) or kerosene to which paragraph (5) applies), if the ultimate purchaser of such kerosene waives (at such time and in such form and manner as the Secretary shall prescribe) the right to payment under paragraph (1) and assigns such right to the ultimate vendor, then the Secretary shall pay the amount which would be paid under paragraph (1) to such ultimate vendor, but only if such ultimate vendor—
is registered under section 4101, and
meets the requirements of subparagraph (A), (B), or (D) of section 6416(a)(1).
Payments for kerosene used in noncommercial aviation
The amount which would be paid under paragraph (1) with respect to any kerosene to which subparagraph (B) applies shall be paid only to the ultimate vendor of such kerosene. A payment shall be made to such vendor if such vendor—
is registered under section 4101, and
meets the requirements of subparagraph (A), (B), or (D) of section 6416(a)(1).
.
Conforming amendments
Section 6427(l) is amended by striking paragraph (5) and by redesignating paragraph (6) as paragraph (5).
Section
4082(d)(2)(B) is amended by striking section 6427(l)(6)(B)
and
inserting section 6427(l)(5)(B)
.
Section 6427(i)(4)(A) is amended—
by striking
paragraph (4)(B), (5), or (6)
each place it appears and
inserting paragraph (4)(C) or (5)
, and
by striking
(l)(5), and (l)(6)
and inserting (l)(4)(C)(ii), and
(l)(5)
.
Section 6427(l)(1)
is amended by striking paragraph (4)(B)
and inserting
paragraph (4)(C)(i)
.
Section 9502(d) is amended—
in paragraph (2),
by striking and (l)(5)
, and
in paragraph (3),
by striking or (5)
.
Section 9503(c)(7) is amended—
by amending subparagraphs (A) and (B) to read as follows:
4.3 cents per gallon of kerosene subject to section 6427(l)(4)(A) with respect to which a payment has been made by the Secretary under section 6427(l), and
21.8 cents per gallon of kerosene subject to section 6427(l)(4)(B) with respect to which a payment has been made by the Secretary under section 6427(l).
, and
in the matter
following subparagraph (B), by striking or (5)
.
Effective date
In general
The amendments made by this section shall apply to kerosene sold after September 30, 2005.
Special rule for pending claims
In the case of kerosene sold for use in aviation (other than kerosene to which section 6427(l)(4)(C)(ii) of the Internal Revenue Code of 1986 (as added by subsection (a)) applies or kerosene to which section 6427(l)(5) of such Code (as redesignated by subsection (b)) applies) after September 30, 2005, and before the date of the enactment of this Act, the ultimate purchaser shall be treated as having waived the right to payment under section 6427(l)(1) of such Code and as having assigned such right to the ultimate vendor if such ultimate vendor has met the requirements of subparagraph (A), (B), or (D) of section 6416(a)(1) of such Code.
Special rule for kerosene used in aviation on a farm for farming purposes
Refunds for purchases after December 31, 2004, and before October 1, 2005
The Secretary of the Treasury shall pay to the ultimate purchaser of any kerosene which is used in aviation on a farm for farming purposes and which was purchased after December 31, 2004, and before October 1, 2005, an amount equal to the aggregate amount of tax imposed on such fuel under section 4041 or 4081 of the Internal Revenue Code of 1986, as the case may be, reduced by any payment to the ultimate vendor under section 6427(l)(5)(C) of such Code (as in effect on the day before the date of the enactment of the Safe, Accountable, Flexible, Efficient Transportation Equity Act: a Legacy for Users).
Use on a farm for farming purposes
For purposes of paragraph (1), kerosene shall be treated as used on a farm for farming purposes if such kerosene is used for farming purposes (within the meaning of section 6420(c)(3) of the Internal Revenue Code of 1986) in carrying on a trade or business on a farm situated in the United States. For purposes of the preceding sentence, rules similar to the rules of section 6420(c)(4) of such Code shall apply.
Time for filing claims
No claim shall be allowed under paragraph (1) unless the ultimate purchaser files such claim before the date that is 3 months after the date of the enactment of this Act.
No double benefit
No amount shall be paid under paragraph (1) or section 6427(l) of the Internal Revenue Code of 1986 with respect to any kerosene described in paragraph (1) to the extent that such amount is in excess of the tax imposed on such kerosene under section 4041 or 4081 of such Code, as the case may be.
Applicable laws
For purposes of this subsection, rules similar to the rules of section 6427(j) of the Internal Revenue Code of 1986 shall apply.
Regional income tax agencies treated as States for purposes of confidentiality and disclosure requirements
In general
Paragraph (5) of section 6103(b) is amended to read as follows:
State
In general
The term State means—
any of the 50 States, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, the Canal Zone, Guam, American Samoa, and the Commonwealth of the Northern Mariana Islands,
for purposes of subsections (a)(2), (b)(4), (d)(1), (h)(4), and (p), any municipality—
with a population in excess of 250,000 (as determined under the most recent decennial United States census data available),
which imposes a tax on income or wages, and
with which the Secretary (in his sole discretion) has entered into an agreement regarding disclosure, and
for purposes of subsections (a)(2), (b)(4), (d)(1), (h)(4), and (p), any governmental entity—
which is formed and operated by a qualified group of municipalities, and
with which the Secretary (in his sole discretion) has entered into an agreement regarding disclosure.
Regional income tax agencies
For purposes of subparagraph (A)(iii)—
Qualified group of municipalities
The term qualified group of municipalities means, with respect to any governmental entity, 2 or more municipalities—
each of which imposes a tax on income or wages,
each of which, under the authority of a State statute, administers the laws relating to the imposition of such taxes through such entity, and
which collectively have a population in excess of 250,000 (as determined under the most recent decennial United States census data available).
References to State law, etc
For purposes of applying subparagraph (A)(iii) to the subsections referred to in such subparagraph, any reference in such subsections to State law, proceedings, or tax returns shall be treated as references to the law, proceedings, or tax returns, as the case may be, of the municipalities which form and operate the governmental entity referred to in such subparagraph.
Disclosure to contractors and other agents
Notwithstanding any other provision of this section, no return or return information shall be disclosed to any contractor or other agent of a governmental entity referred to in subparagraph (A)(iii) unless such entity, to the satisfaction of the Secretary—
has requirements in effect which require each such contractor or other agent which would have access to returns or return information to provide safeguards (within the meaning of subsection (p)(4)) to protect the confidentiality of such returns or return information,
agrees to conduct an on-site review every 3 years (or a mid-point review in the case of contracts or agreements of less than 3 years in duration) of each contractor or other agent to determine compliance with such requirements,
submits the findings of the most recent review conducted under subclause (II) to the Secretary as part of the report required by subsection (p)(4)(E), and
certifies to the Secretary for the most recent annual period that such contractor or other agent is in compliance with all such requirements.
.
Special rules for disclosure
Subsection (d) of section 6103 is amended by adding at the end the following new paragraph:
Limitation on disclosure regarding regional income tax agencies treated as States
For purposes of paragraph (1), inspection by or disclosure to an entity described in subsection (b)(5)(A)(iii) shall be for the purpose of, and only to the extent necessary in, the administration of the laws of the member municipalities in such entity relating to the imposition of a tax on income or wages. Such entity may not redisclose any return or return information received pursuant to paragraph (1) to any such member municipality.
.
Effective date
The amendments made by this section shall apply to disclosures made after December 31, 2006.
Designation of wines by semi-generic names
In general
Subsection (c) of section 5388 (relating to use of semi-generic designations) is amended by adding at the end the following new paragraph:
Special rule for use of certain semi-generic designations
In general
In the case of any wine to which this paragraph applies—
paragraph (1) shall not apply,
in the case of wine of the European Community, designations referred to in subparagraph (C)(i) may be used for such wine only if the requirement of subparagraph (B)(ii) is met, and
in the case any other wine bearing a brand name, or brand name and fanciful name, semi-generic designations may be used for such wine only if the requirements of clauses (i), (ii), and (iii) of subparagraph (B) are met.
Requirements
The requirement of this clause is met if there appears in direct conjunction with the semi-generic designation an appropriate appellation of origin disclosing the origin of the wine.
The requirement of this clause is met if the wine conforms to the standard of identity, if any, for such wine contained in the regulations under this section or, if there is no such standard, to the trade understanding of such class or type.
The requirement of this clause is met if the person, or its successor in interest, using the semi-generic designation held a Certificate of Label Approval or Certificate of Exemption from Label Approval issued by the Secretary for a wine label bearing such brand name, or brand name and fanciful name, before March 10, 2006, on which such semi-generic designation appeared.
Wines to which paragraph applies
In general
Except as provided in clause (ii), this paragraph shall apply to any grape wine which is designated as Burgundy, Claret, Chablis, Champagne, Chianti, Malaga, Marsala, Madeira, Moselle, Port, Retsina, Rhine Wine or Hock, Sauterne, Haut Sauterne, Sherry, or Tokay.
Exception
This paragraph shall not apply to wine which—
contains less than 7 percent or more than 24 percent alcohol by volume,
is intended for sale outside the United States, or
does not bear a brand name.
.
Effective date
The amendments made by this section shall apply to wine imported or bottled in the United States on or after the date of enactment of this Act.
Modification of railroad track maintenance credit
In general
Section 45G(d) (defining qualified railroad track maintenance expenditures) is amended—
by inserting
gross
after means
, and
by inserting
(determined without regard to any consideration for such expenditures
given by the Class II or Class III railroad which made the assignment of such
track)
after Class II or Class III railroad
.
Effective date
The amendment made by this section shall take effect as if included in the amendment made by section 245(a) of the American Jobs Creation Act of 2004.
Modification of excise tax on unrelated business taxable income of charitable remainder trusts
In general
Subsection (c) of section 664 (relating to exemption from income taxes) is amended to read as follows:
Taxation of trusts
Income tax
A charitable remainder annuity trust and a charitable remainder unitrust shall, for any taxable year, not be subject to any tax imposed by this subtitle.
Excise tax
In general
In the case of a charitable remainder annuity trust or a charitable remainder unitrust which has unrelated business taxable income (within the meaning of section 512, determined as if part III of subchapter F applied to such trust) for a taxable year, there is hereby imposed on such trust or unitrust an excise tax equal to the amount of such unrelated business taxable income.
Certain rules to apply
The tax imposed by subparagraph (A) shall be treated as imposed by chapter 42 for purposes of this title other than subchapter E of chapter 42.
Tax court proceedings
For purposes of this paragraph, the references in section 6212(c)(1) to section 4940 shall be deemed to include references to this paragraph.
.
Effective date
The amendment made by this section shall apply to taxable years beginning after December 31, 2006.
Loans to qualified continuing care facilities made permanent
In general
Subsection (h) of section 7872 (relating to exception for loans to qualified continuing care facilities) is amended by striking paragraph (4).
Effective date
The amendment made by this section shall take effect as if included in section 209 of the Tax Increase Prevention and Reconciliation Act of 2005.
Technical corrections
Technical correction relating to look-through treatment of payments between related controlled foreign corporations under the foreign personal holding company rules
In general
The first sentence
of section 954(c)(6)(A) is amended by striking which is not subpart F
income
and inserting which is neither subpart F income nor
income treated as effectively connected with the conduct of a trade or business
in the United States
.
Section
954(c)(6)(A) is amended by striking the last sentence and inserting the
following: The Secretary shall prescribe such regulations as may be
necessary or appropriate to carry out this paragraph, including such
regulations as may be necessary or appropriate to prevent the abuse of the
purposes of this paragraph.
Effective date
The amendments made by this subsection shall take effect as if included in section 103(b) of the Tax Increase Prevention and Reconciliation Act of 2005.
Technical correction regarding authority to exercise reasonable cause and good faith exception
In general
Section 903(d)(2)(B)(iii) of the American Jobs Creation
Act of 2004, as amended by section 303(a) of the Gulf Opportunity Zone Act of
2005, is amended by inserting or the Secretary’s delegate
after
the Secretary of the Treasury
.
Effective date
The amendment made by this subsection shall take effect as if included in the provisions of the American Jobs Creation Act of 2004 to which it relates.
Medicare and Other Health Provisions
Short title of division
This division may be
cited as the Medicare Improvements and Extension Act of
2006
.
Medicare Improved Quality and Provider Payments
Physician payment and quality improvement
One-year increase in Medicare physician fee schedule conversion factor
Section 1848(d) of the Social Security Act (42 U.S.C. 1395w-4(d)) is amended by adding at the end the following new paragraph:
Conversion factor for 2007
In general
The conversion factor that would otherwise be applicable under this subsection for 2007 shall be the amount of such conversion factor divided by the product of—
1 plus the Secretary’s estimate of the percentage increase in the MEI (as defined in section 1842(i)(3)) for 2007 (divided by 100); and
1 plus the Secretary’s estimate of the update adjustment factor under paragraph (4)(B) for 2007.
No effect on computation of conversion factor for 2008
The conversion factor under this subsection shall be computed under paragraph (1)(A) for 2008 as if subparagraph (A) had never applied.
.
Quality reporting system
Section 1848 of the Social Security Act (42 U.S.C. 1395w-4) is amended by adding at the end the following new subsection:
Quality reporting system
In general
The Secretary shall implement a system for the reporting by eligible professionals of data on quality measures specified under paragraph (2). Such data shall be submitted in a form and manner specified by the Secretary (by program instruction or otherwise), which may include submission of such data on claims under this part.
Use of consensus-based quality measures
For 2007
In general
For purposes of applying this subsection for the reporting of data on quality measures for covered professional services furnished during the period beginning July 1, 2007, and ending December 31, 2007, the quality measures specified under this paragraph are the measures identified as 2007 physician quality measures under the Physician Voluntary Reporting Program as published on the public website of the Centers for Medicare & Medicaid Services as of the date of the enactment of this subsection, except as may be changed by the Secretary based on the results of a consensus-based process in January of 2007, if such change is published on such website by not later than April 1, 2007.
Subsequent refinements in application permitted
The Secretary may, from time to time (but not later than July 1, 2007), publish on such website (without notice or opportunity for public comment) modifications or refinements (such as code additions, corrections, or revisions) for the application of quality measures previously published under clause (i), but may not, under this clause, change the quality measures under the reporting system.
Implementation
Notwithstanding any other provision of law, the Secretary may implement by program instruction or otherwise this subsection for 2007.
For 2008
In general
For purposes of reporting data on quality measures for covered professional services furnished during 2008, the quality measures specified under this paragraph for covered professional services shall be measures that have been adopted or endorsed by a consensus organization (such as the National Quality Forum or AQA), that include measures that have been submitted by a physician specialty, and that the Secretary identifies as having used a consensus-based process for developing such measures. Such measures shall include structural measures, such as the use of electronic health records and electronic prescribing technology.
Proposed set of measures
Not later than August 15, 2007, the Secretary shall publish in the Federal Register a proposed set of quality measures that the Secretary determines are described in clause (i) and would be appropriate for eligible professionals to use to submit data to the Secretary in 2008. The Secretary shall provide for a period of public comment on such set of measures.
Final set of measures
Not later than November 15, 2007, the Secretary shall publish in the Federal Register a final set of quality measures that the Secretary determines are described in clause (i) and would be appropriate for eligible professionals to use to submit data to the Secretary in 2008.
Covered professional services and eligible professionals defined
For purposes of this subsection:
Covered professional services
The
term covered professional services
means services for which
payment is made under, or is based on, the fee schedule established under this
section and which are furnished by an eligible professional.
Eligible professional
The term eligible professional
means
any of the following:
A physician.
A practitioner described in section 1842(b)(18)(C).
A physical or occupational therapist or a qualified speech-language pathologist.
Use of registry-based reporting
As part of the publication of proposed and final quality measures for 2008 under clauses (ii) and (iii) of paragraph (2)(B), the Secretary shall address a mechanism whereby an eligible professional may provide data on quality measures through an appropriate medical registry (such as the Society of Thoracic Surgeons National Database), as identified by the Secretary.
Identification units
For purposes of applying this subsection, the Secretary may identify eligible professionals through billing units, which may include the use of the Provider Identification Number, the unique physician identification number (described in section 1833(q)(1)), the taxpayer identification number, or the National Provider Identifier. For purposes of applying this subsection for 2007, the Secretary shall use the taxpayer identification number as the billing unit.
Education and outreach
The Secretary shall provide for education and outreach to eligible professionals on the operation of this subsection.
Limitations on review
There shall be no administrative or judicial review under section 1869, section 1878, or otherwise, of the development and implementation of the reporting system under paragraph (1), including identification of quality measures under paragraph (2) and the application of paragraphs (4) and (5).
Implementation
The Secretary shall carry out this subsection acting through the Administrator of the Centers for Medicare & Medicaid Services.
.
Transitional bonus incentive payments for quality reporting in 2007
In general
With respect to covered professional services furnished during a reporting period (as defined in paragraph (6)(C)) by an eligible professional, if—
there are any quality measures that have been established under the physician reporting system that are applicable to any such services furnished by such professional for such period, and
the eligible professional satisfactorily submits (as determined under paragraph (2)) to the Secretary data on such quality measures in accordance with such reporting system for such reporting period,
Satisfactory reporting described
For purposes of paragraph (1), an eligible professional shall be treated as satisfactorily submitting data on quality measures for covered professional services for a reporting period if quality measures have been reported as follows:
Three or fewer quality measures applicable
If there are no more than 3 quality measures that are provided under the physician reporting system and that are applicable to such services of such professional furnished during the period, each such quality measure has been reported under such system in at least 80 percent of the cases in which such measure is reportable under the system.
Four or more quality measures applicable
If there are 4 or more quality measures that are provided under the physician reporting system and that are applicable to such services of such professional furnished during the period, at least 3 such quality measures have been reported under such system in at least 80 percent of the cases in which the respective measure is reportable under the system.
Payment limitation
In general
In no case shall the total payment made under this subsection to an eligible professional (or to an employer or facility in the cases described in clause (A) of section 1842(b)(6) of the Social Security Act) exceed the product of—
the total number of quality measures for which data are submitted under the physician reporting system for covered professional services of such professional that are furnished during the reporting period; and
300 percent of the average per measure payment amount specified in subparagraph (B).
Average per measure payment amount specified
The average per measure payment amount specified in this subparagraph is an amount, estimated by the Secretary (based on claims submitted not later than two months after the end of the reporting period), equal to—
the total of the amount of allowed charges under part B of title XVIII of the Social Security Act for all covered professional services furnished during the reporting period on claims for which quality measures are reported under the physician reporting system; divided by
the total number of quality measures for which data are reported under such system for covered professional services furnished during the reporting period.
Form of payment
The payment under this subsection shall be in the form of a single consolidated payment.
Application
Physician reporting system rules
Paragraphs (5), (6), and (8) of section 1848(k) of the Social Security Act, as added by subsection (b), shall apply for purposes of this subsection in the same manner as they apply for purposes of such section.
Coordination with other bonus payments
The provisions of this subsection shall not be taken into account in applying subsections (m) and (u) of section 1833 of the Social Security Act (42 U.S.C. 1395l) and any payment under such subsections shall not be taken into account in computing allowable charges under this subsection.
Implementation
Notwithstanding any other provision of law, the Secretary may implement by program instruction or otherwise this subsection.
Validation
In general
Subject to the succeeding provisions of this subparagraph, for purposes of determining whether a measure is applicable to the covered professional services of an eligible professional under paragraph (2), the Secretary shall presume that if an eligible professional submits data for a measure, such measure is applicable to such professional.
Method
The Secretary shall validate (by sampling or other means as the Secretary determines to be appropriate) whether measures applicable to covered professional services of an eligible professional have been reported.
Denial of payment authority
If the Secretary determines that an eligible professional has not reported measures applicable to covered professional services of such professional, the Secretary shall not pay the bonus incentive payment.
Limitations on review
In general
There shall be no administrative or judicial review under section 1869 or 1878 of the Social Security Act or otherwise of—
the determination of measures applicable to services furnished by eligible professionals under this subsection;
the determination of satisfactory reporting under paragraph (2);
the determination of the payment limitation under paragraph (3); and
the determination of the bonus incentive payment under this subsection.
Treatment of determinations
A determination under this subsection shall not be treated as a determination for purposes of section 1869 of the Social Security Act.
Definitions
For purposes of this subsection:
Eligible professional; covered professional services
The terms
eligible professional
and covered professional
services
have the meanings given such terms in section 1848(k)(3) of
the Social Security Act, as added by subsection (b).
Physician reporting system
The term physician reporting
system
means the system established under section 1848(k) of the Social
Security Act, as added by subsection (b).
Reporting period
The term
reporting period
means the period beginning on July 1, 2007, and
ending on December 31, 2007.
Secretary
The
term Secretary
means the Secretary of Health and Human
Services.
Physician assistance and quality initiative fund
Section 1848 of the Social Security Act, as amended by subsection (b), is further amended by adding at the end the following new subsection:
Physician assistance and quality initiative fund
Establishment
The Secretary shall establish under this
subsection a Physician Assistance and Quality Initiative Fund (in this
subsection referred to as the Fund
) which shall be available to
the Secretary for physician payment and quality improvement initiatives, which
may include application of an adjustment to the update of the conversion factor
under subsection (d).
Funding
Amount available
There shall be available to the Fund for expenditures an amount equal to $1,350,000,000.
Timely obligation of all available funds for services furnished during 2008
The Secretary shall provide for expenditures from the Fund in a manner designed to provide (to the maximum extent feasible) for the obligation of the entire amount specified in subparagraph (A) for payment with respect to physicians’ services furnished during 2008.
Payment from trust fund
The amount specified in subparagraph (A) shall be available to the Fund, as expenditures are made from the Fund, from the Federal Supplementary Medical Insurance Trust Fund under section 1841.
Funding limitation
Amounts in the Fund shall be available in advance of appropriations in accordance with subparagraph (B) but only if the total amount obligated from the Fund does not exceed the amount available to the Fund under subparagraph (A). The Secretary may obligate funds from the Fund only if the Secretary determines (and the Chief Actuary of the Centers for Medicare & Medicaid Services and the appropriate budget officer certify) that there are available in the Fund sufficient amounts to cover all such obligations incurred consistent with the previous sentence.
Construction
In the case that expenditures from the Fund are applied to, or otherwise affect, a conversion factor under subsection (d) for a year, the conversion factor under such subsection shall be computed for a subsequent year as if such application or effect had never occurred.
.
Implementation
For purposes of implementing the provisions of, and amendments made by, this section, the Secretary of Health and Human Services shall provide for the transfer, from the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of the Social Security Act (42 U.S.C. 1395t), of $60,000,000 to the Centers for Medicare & Medicaid Services Program Management Account for the period of fiscal years 2007, 2008, and 2009.
Extension of floor on Medicare work geographic adjustment
Section 1848(e)(1)(E) of the Social Security
Act (42 U.S.C. 1395w–4(e)(1)(E)) is amended by striking before January
1, 2007
and inserting before January 1, 2008
.
Update to the composite rate component of the basic case-mix adjusted prospective payment system for dialysis services
In general
Section 1881(b)(12)(G) of the Social Security Act (42 U.S.C. 1395rr(b)(12)(G)) is amended to read as follows:
The Secretary shall increase the amount of the composite rate component of the basic case-mix adjusted system under subparagraph (B) for dialysis services—
furnished on or after January 1, 2006, and before April 1, 2007, by 1.6 percent above the amount of such composite rate component for such services furnished on December 31, 2005; and
furnished on or after April 1, 2007, by 1.6 percent above the amount of such composite rate component for such services furnished on March 31, 2007.
.
GAO report on home dialysis payment
Not later than January 1, 2009, the Comptroller General of the United States shall submit to Congress a report on the costs for home hemodialysis treatment and patient training for both home hemodialysis and peritoneal dialysis. Such report shall also include recommendations for a payment methodology for payment under section 1881 of the Social Security Act (42 U.S.C. 1395rr) that measures, and is based on, the costs of providing such services and takes into account the case mix of patients.
Extension of treatment of certain physician pathology services under Medicare
Section 542(c) of the Medicare, Medicaid,
and SCHIP Benefits Improvement and Protection Act of 2000 (as enacted into law
by section 1(a)(6) of Public Law 106–554), as amended by section 732 of the
Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public
Law 108–173), is amended by striking and 2006
and inserting
, 2006, and 2007
.
Extension of Medicare reasonable costs payments for certain clinical diagnostic laboratory tests furnished to hospital patients in certain rural areas
Effective as if included in the enactment of
section 416 of the Medicare Prescription Drug, Improvement, and Modernization
Act of 2003 (42 U.S.C. 1395l–4), subsection (b) of such section is amended by
striking 2-year period
and inserting 3-year
period
.
Hospital Medicare reports and clarifications
Correction of mid-year reclassification expiration
Notwithstanding any other provision of law, in the case of a subsection (d) hospital (as defined for purposes of section 1886 of the Social Security Act (42 U.S.C. 1395ww)) with respect to which a reclassification of its wage index for purposes of such section would (but for this subsection) expire on March 31, 2007, such reclassification of such hospital shall be extended through September 30, 2007. The previous sentence shall not be effected in a budget-neutral manner.
Revision of the Medicare wage index classification system
MedPAC report
In general
The Medicare Payment Advisory Commission shall submit to Congress, by not later than June 30, 2007, a report on its study of the wage index classification system applied under Medicare prospective payment systems, including under section 1886(d)(3)(E) of the Social Security Act (42 U.S.C. 1395ww(d)(3)(E)). Such report shall include any alternatives the Commission recommends to the method to compute the wage index under such section.
Funding
Out of any funds in the Treasury not otherwise appropriated, there are appropriated to the Medicare Payment Advisory Commission, $2,000,000 for fiscal year 2007 to carry out this paragraph.
Proposal to revise the hospital wage index classification system
The Secretary of Health and Human Services, taking into account the recommendations described in the report under paragraph (1), shall include in the proposed rule published under section 1886(e)(5)(A) of the Social Security Act (42 U.S.C. 1395ww(e)(5)(A)) for fiscal year 2009 one or more proposals to revise the wage index adjustment applied under section 1886(d)(3)(E) of such Act (42 U.S.C. 1395ww(d)(3)(E)) for purposes of the Medicare prospective payment system for inpatient hospital services. Such proposal (or proposals) shall consider each of the following:
Problems associated with the definition of labor markets for purposes of such wage index adjustment.
The modification or elimination of geographic reclassifications and other adjustments.
The use of Bureau of Labor Statistics data, or other data or methodologies, to calculate relative wages for each geographic area involved.
Minimizing variations in wage index adjustments between and within Metropolitan Statistical Areas and Statewide rural areas.
The feasibility of applying all components of the proposal to other settings, including home health agencies and skilled nursing facilities.
Methods to minimize the volatility of wage index adjustments, while maintaining the principle of budget neutrality in applying such adjustments.
The effect that the implementation of the proposal would have on health care providers and on each region of the country.
Methods for implementing the proposal, including methods to phase-in such implementation.
Issues relating to occupational mix, such as staffing practices and any evidence on the effect on quality of care and patient safety and any recommendations for alternative calculations.
Elimination of unnecessary report
Section 1886 of the Social Security Act (42 U.S.C. 1395ww) is amended—
in subsection (d)(4)(C), by striking clause (iv); and
in subsection (e), by striking paragraph (3).
Payment for brachytherapy
Extension of payment rule
Section
1833(t)(16)(C) of the Social Security Act (42 U.S.C. 1395l(t)(16)(C)) is
amended by striking January 1, 2007
and inserting January
1, 2008
.
Establishment of separate payment groups
In general
Section 1833(t)(2)(H) of such Act (42 U.S.C.
1395l(t)(2)(H)) is amended by inserting and for stranded and
non-stranded devices furnished on or after July 1, 2007
before the
period at the end.
Implementation
The Secretary of Health and Human Services may implement the amendment made by paragraph (1) by program instruction or otherwise.
Payment process under the competitive acquisition program (CAP)
In general
Section 1847B(a)(3) of the Social Security Act (42 U.S.C. 1395w-3b(a)(3)) is amended—
in subparagraph
(A)(iii), by striking and biologicals
and all that follows and
inserting and biologicals shall be made only to such contractor upon
receipt of a claim for a drug or biological supplied by the contractor for
administration to a beneficiary.
; and
by adding at the end the following new subparagraph:
Post-payment review process
The Secretary shall establish (by program instruction or otherwise) a post-payment review process (which may include the use of statistical sampling) to assure that payment is made for a drug or biological under this section only if the drug or biological has been administered to a beneficiary. The Secretary shall recoup, offset, or collect any overpayments determined by the Secretary under such process.
.
Construction
Nothing in this section shall be construed as—
requiring the conduct of any additional competition under subsection (b)(1) of section 1847B of the Social Security Act (42 U.S.C. 1395w–3b); or
requiring any additional process for elections by physicians under subsection (a)(1)(A)(ii) of such section or additional selection by a selecting physician of a contractor under subsection (a)(5) of such section.
Effective date
The amendments made by subsection (a) shall apply to payment for drugs and biologicals supplied under section 1847B of the Social Security Act (42 U.S.C. 1395w–3b)—
on or after April 1, 2007; and
on or after July 1, 2006, and before April 1, 2007, for claims that are unpaid as of April 1, 2007.
Quality reporting for hospital outpatient services and ambulatory surgical center services
Outpatient hospital services
In general
Section 1833(t) of the Social Security Act (42 U.S.C. 1395l(t)) is amended—
in paragraph
(3)(C)(iv), by inserting subject to paragraph (17),
after
For purposes of this subparagraph,
; and
by adding at the end the following new paragraph:
Quality reporting
Reduction in update for failure to report
In general
For purposes of paragraph (3)(C)(iv) for 2009 and each subsequent year, in the case of a subsection (d) hospital (as defined in section 1886(d)(1)(B)) that does not submit, to the Secretary in accordance with this paragraph, data required to be submitted on measures selected under this paragraph with respect to such a year, the OPD fee schedule increase factor under paragraph (3)(C)(iv) for such year shall be reduced by 2.0 percentage points.
Non-cumulative application
A reduction under this subparagraph shall apply only with respect to the year involved and the Secretary shall not take into account such reduction in computing the OPD fee schedule increase factor for a subsequent year.
Form and manner of submission
Each subsection (d) hospital shall submit data on measures selected under this paragraph to the Secretary in a form and manner, and at a time, specified by the Secretary for purposes of this paragraph.
Development of outpatient measures
In general
The Secretary shall develop measures that the Secretary determines to be appropriate for the measurement of the quality of care (including medication errors) furnished by hospitals in outpatient settings and that reflect consensus among affected parties and, to the extent feasible and practicable, shall include measures set forth by one or more national consensus building entities.
Construction
Nothing in this paragraph shall be construed as preventing the Secretary from selecting measures that are the same as (or a subset of) the measures for which data are required to be submitted under section 1886(b)(3)(B)(viii).
Replacement of measures
For purposes of this paragraph, the Secretary may replace any measures or indicators in appropriate cases, such as where all hospitals are effectively in compliance or the measures or indicators have been subsequently shown not to represent the best clinical practice.
Availability of data
The Secretary shall establish procedures for making data submitted under this paragraph available to the public. Such procedures shall ensure that a hospital has the opportunity to review the data that are to be made public with respect to the hospital prior to such data being made public. The Secretary shall report quality measures of process, structure, outcome, patients' perspectives on care, efficiency, and costs of care that relate to services furnished in outpatient settings in hospitals on the Internet website of the Centers for Medicare & Medicaid Services.
.
Conforming amendment
Section 1886(b)(3)(B)(viii)(III) of such Act (42 U.S.C.
1395ww(b)(3)(B)(viii)(III)) is amended by inserting (including
medication errors)
after quality of care
.
Application to ambulatory surgical centers
Section 1833(i) of such Act (42 U.S.C. 1935l(i)) is amended—
in paragraph (2)(D), by redesignating clause (iv) as clause (v) and by inserting after clause (iii) the following new clause:
The Secretary may implement such system in a manner so as to provide for a reduction in any annual update for failure to report on quality measures in accordance with paragraph (7).
; and
by adding at the end the following new paragraph:
For purposes of paragraph (2)(D)(iv), the Secretary may provide, in the case of an ambulatory surgical center that does not submit, to the Secretary in accordance with this paragraph, data required to be submitted on measures selected under this paragraph with respect to a year, any annual increase provided under the system established under paragraph (2)(D) for such year shall be reduced by 2.0 percentage points. A reduction under this subparagraph shall apply only with respect to the year involved and the Secretary shall not take into account such reduction in computing any annual increase factor for a subsequent year.
Except as the Secretary may otherwise provide, the provisions of subparagraphs (B), (C), (D), and (E) of paragraph (17) of section 1833(t) shall apply with respect to services of ambulatory surgical centers under this paragraph in a similar manner to the manner in which they apply under such paragraph and, for purposes of this subparagraph, any reference to a hospital, outpatient setting, or outpatient hospital services is deemed a reference to an ambulatory surgical center, the setting of such a center, or services of such a center, respectively.
.
Effective date
The amendments made by this section shall apply to payment for services furnished on or after January 1, 2009.
Reporting of anemia quality indicators for Medicare part B cancer anti-anemia drugs
In general
Section 1842 of the Social Security Act (42 U.S.C. 1395u) is amended by adding at the end the following new subsection:
Each request for payment, or bill submitted, for a drug furnished to an individual for the treatment of anemia in connection with the treatment of cancer shall include (in a form and manner specified by the Secretary) information on the hemoglobin or hematocrit levels for the individual.
.
Effective date
The amendment made by subsection (a) shall apply to drugs furnished on or after January 1, 2008. The Secretary of Health and Human Services shall address the implementation of such amendment in the rulemaking process under section 1848 of the Social Security Act (42 U.S.C. 1395w–4) for payment for physicians’ services for 2008, consistent with the previous sentence.
Clarification of hospice satellite designation
Notwithstanding any other provision of law, for purposes of calculating the hospice aggregate payment cap for 2004, 2005, and 2006 for a hospice program under section 1814(i)(2)(A) of the Social Security Act (42 U.S.C. 1395f(i)(2)(A)) for hospice care provided on or after November 1, 2003, and before December 27, 2005, Medicare provider number 29–1511 is deemed to be a multiple location of Medicare provider number 29–1500.
Medicare Beneficiary Protections
Extension of exceptions process for Medicare therapy caps
Section 1833(g)(5) of the Social Security
Act (42 U.S.C. 1395l(g)(5)) is amended by striking 2006
and
inserting the period beginning on January 1, 2006, and ending on
December 31, 2007,
.
Payment for administration of part D vaccines
Transition for 2007
Notwithstanding any other provision of law, in the case of a vaccine that is a covered part D drug under section 1860D–2(e) of the Social Security Act (42 U.S.C. 1395w–102(e)) and that is administered during 2007, the administration of such vaccine shall be paid under part B of title XVIII of such Act as if it were the administration of a vaccine described in section 1861(s)(10)(B) of such Act (42 U.S.C. 1395w(s)(10)(B)).
Administration included in coverage of covered part D drugs beginning in 2008
Section 1860D–2(e)(1) of the Social Security Act (42 U.S.C.
1395w–102(e)(1)) is amended, in the matter following subparagraph (B), by
inserting (and, for vaccines administered on or after January 1, 2008,
its administration)
after Public Health Service
Act
.
OIG study of never events
Study
In general
The Inspector General in the Department of Health and Human Services shall conduct a study on—
incidences of never events for Medicare beneficiaries, including types of such events and payments by any party for such events;
the extent to which the Medicare program paid, denied payment, or recouped payment for services furnished in connection with such events and the extent to which beneficiaries paid for such services; and
the administrative processes of the Centers for Medicare & Medicaid Services to detect such events and to deny or recoup payments for services furnished in connection with such an event.
Conduct of study
In conducting the study under paragraph (1), the Inspector General—
shall audit a representative sample of claims and medical records of Medicare beneficiaries to identify never events and any payment (or recoupment) for services furnished in connection with such events;
may request access to such claims and records from any Medicare contractor; and
shall not release individually identifiable information or facility-specific information.
Report
Not later than 2 years after the date of the enactment of this Act, the Inspector General shall submit a report to Congress on the study conducted under this section. Such report shall include recommendations for such legislation and administrative action, such as a noncoverage policy or denial of payments, as the Inspector General determines appropriate, including—
recommendations on processes to identify never events and to deny or recoup payments for services furnished in connection with such events; and
a recommendation on a potential process (or processes) for public disclosure of never events which—
will ensure protection of patient privacy; and
will permit the use of the disclosed information for a root cause analysis to inform the public and the medical community about safety issues involved.
Funding
Out of any funds in the Treasury not otherwise appropriated, there are appropriated to the Inspector General of the Department of Health and Human Services $3,000,000 to carry out this section, to be available until January 1, 2010.
Never events defined
For purposes of this section, the term never
event
means an event that is listed and endorsed as a serious
reportable event by the National Quality Forum as of November 16, 2006.
Medicare medical home demonstration project
In general
The Secretary of Health and Human Services (in this
section referred to as the Secretary
) shall establish under
title XVIII of the Social Security Act a medical home demonstration project (in
this section referred to as the project
) to redesign the health
care delivery system to provide targeted, accessible, continuous and
coordinated, family-centered care to high-need populations and under
which—
care management fees are paid to persons performing services as personal physicians; and
incentive payments are paid to physicians participating in practices that provide services as a medical home under subsection (d).
high-need populationmeans individuals with multiple chronic illnesses that require regular medical monitoring, advising, or treatment.
Details
Duration; scope
The project shall operate during a period of three years and shall include urban, rural, and underserved areas in a total of no more than 8 States.
Encouraging participation of small physician practices
The project shall be designed to include the participation of physicians in practices with fewer than three full-time equivalent physicians, as well as physicians in larger practices particularly in rural and underserved areas.
Personal physician defined
In general
For purposes of this section, the term personal
physician
means a physician (as defined in section 1861(r)(1) of the
Social Security Act (42 U.S.C. 1395x(r)(1)) who—
meets the requirements described in paragraph (2); and
performs the services described in paragraph (3).
Requirements
The requirements described in this paragraph for a personal physician are as follows:
The physician is a board certified physician who provides first contact and continuous care for individuals under the physician’s care.
The physician has the staff and resources to manage the comprehensive and coordinated health care of each such individual.
Services performed
A personal physician shall perform or provide for the performance of at least the following services:
Advocates for and provides ongoing support, oversight, and guidance to implement a plan of care that provides an integrated, coherent, cross-discipline plan for ongoing medical care developed in partnership with patients and including all other physicians furnishing care to the patient involved and other appropriate medical personnel or agencies (such as home health agencies).
Uses evidence-based medicine and clinical decision support tools to guide decision-making at the point-of-care based on patient-specific factors.
Uses health information technology, that may include remote monitoring and patient registries, to monitor and track the health status of patients and to provide patients with enhanced and convenient access to health care services.
Encourages patients to engage in the management of their own health through education and support systems.
Medical home defined
For purposes of this section, the term medical
home
means a physician practice that—
is in charge of targeting beneficiaries for participation in the project; and
is responsible for—
providing safe and secure technology to promote patient access to personal health information;
developing a health assessment tool for the individuals targeted; and
providing training programs for personnel involved in the coordination of care.
Payment mechanisms
Personal physician care management fee
Under the project, the Secretary shall provide for payment under section 1848 of the Social Security Act (42 U.S.C. 1395w–4) of a care management fee to personal physicians providing care management under the project. Under such section and using the relative value scale update committee (RUC) process under such section, the Secretary shall develop a care management fee code for such payments and a value for such code.
Medical home sharing in savings
The Secretary shall provide for payment under the project of a medical home based on the payment methodology applied to physician group practices under section 1866A of the Social Security Act (42 U.S.C. 1395cc–1). Under such methodology, 80 percent of the reductions in expenditures under title XVIII of the Social Security Act resulting from participation of individuals that are attributable to the medical home (as reduced by the total care managements fees paid to the medical home under the project) shall be paid to the medical home. The amount of such reductions in expenditures shall be determined by using assumptions with respect to reductions in the occurrence of health complications, hospitalization rates, medical errors, and adverse drug reactions.
Source
Payments paid under the project shall be made from the Federal Supplementary Medical Insurance Trust Fund under section 1841 of the Social Security Act (42 U.S.C. 1395t).
Evaluations and reports
Annual interim evaluations and reports
For each year of the project, the Secretary shall provide for an evaluation of the project and shall submit to Congress, by a date specified by the Secretary, a report on the project and on the evaluation of the project for each such year.
Final evaluation and report
The Secretary shall provide for an evaluation of the project and shall submit to Congress, not later than one year after completion of the project, a report on the project and on the evaluation of the project.
Medicare DRA technical corrections
PACE clarification
Paragraph (7) of section 5302(c) of the Deficit Reduction Act of 2005 (42 U.S.C. 1395eee note) is amended to read as follows:
Appropriation
In general
Out of funds in the Treasury not otherwise appropriated, there are appropriated to the Secretary $10,000,000 to carry out this subsection for the period of fiscal years 2006 through 2010.
Availability
Funds appropriated under subparagraph (A) shall remain available for obligation through fiscal year 2010.
.
Miscellaneous technical corrections
Correction of margin (Section 5001)
Section 1886(b)(3)(B) of the Social Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended by section 5001(a) of the Deficit Reduction Act of 2005 (Public Law 109–171), is amended by moving clause (viii) (including subclauses (I) through (VII) of such clause) 6 ems to the left.
Reference correction (Section 5114)
Section 5114(a)(2) of the Deficit
Reduction Act of 2005 (Public Law 109–171), in the matter preceding
subparagraph (A), is amended by striking 1842(b)(6)(F) of such Act (42
U.S.C. 1395u(b)(6)(F))
and inserting 1842(b)(6) of such Act (42
U.S.C. 1395u(b)(6))
.
Effective Date
The amendments made by this section shall take effect as if included in the enactment of the Deficit Reduction Act of 2005 (Public Law 109–171).
Medicare Program Integrity Efforts
Offsetting adjustment in Medicare Advantage Stabilization Fund
Section 1858(e)(2)(A)(i) of the Social
Security Act (42 U.S.C. 1395w-27a(e)(2)(A)(i)) is amended by striking
2007,
and $10,000,000,000
and inserting
2012,
and $3,500,000,000
, respectively.
Extension and expansion of recovery audit contractor program under the Medicare Integrity Program
In general
Section 1893 of the Social Security Act (42 U.S.C. 1395ddd) is amended by adding at the end the following new subsection:
Use of recovery audit contractors
In general
Under the Program, the Secretary shall enter into contracts with recovery audit contractors in accordance with this subsection for the purpose of identifying underpayments and overpayments and recouping overpayments under this title with respect to all services for which payment is made under part A or B. Under the contracts—
payment shall be made to such a contractor only from amounts recovered;
from such amounts recovered, payment—
shall be made on a contingent basis for collecting overpayments; and
may be made in such amounts as the Secretary may specify for identifying underpayments; and
the Secretary shall retain a portion of the amounts recovered which shall be available to the program management account of the Centers for Medicare & Medicaid Services for purposes of activities conducted under the recovery audit program under this subsection.
Disposition of remaining recoveries
The amounts recovered under such contracts that are not paid to the contractor under paragraph (1) or retained by the Secretary under paragraph (1)(C) shall be applied to reduce expenditures under parts A and B.
Nationwide coverage
The Secretary shall enter into contracts under paragraph (1) in a manner so as to provide for activities in all States under such a contract by not later than January 1, 2010.
Audit and recovery periods
Each such contract shall provide that audit and recovery activities may be conducted during a fiscal year with respect to payments made under part A or B—
during such fiscal year; and
retrospectively (for a period of not more than 4 fiscal years prior to such fiscal year).
Waiver
The Secretary shall waive such provisions of this title as may be necessary to provide for payment of recovery audit contractors under this subsection in accordance with paragraph (1).
Qualifications of contractors
In general
The Secretary may not enter into a contract under paragraph (1) with a recovery audit contractor unless the contractor has staff that has the appropriate clinical knowledge of, and experience with, the payment rules and regulations under this title or the contractor has, or will contract with, another entity that has such knowledgeable and experienced staff.
Ineligibility of certain contractors
The Secretary may not enter into a contract under paragraph (1) with a recovery audit contractor to the extent the contractor is a fiscal intermediary under section 1816, a carrier under section 1842, or a medicare administrative contractor under section 1874A.
Preference for entities with demonstrated proficiency
In awarding contracts to recovery audit contractors under paragraph (1), the Secretary shall give preference to those risk entities that the Secretary determines have demonstrated more than 3 years direct management experience and a proficiency for cost control or recovery audits with private insurers, health care providers, health plans, under the Medicaid program under title XIX, or under this title.
Construction relating to conduct of investigation of fraud
A recovery of an overpayment to a individual or entity by a recovery audit contractor under this subsection shall not be construed to prohibit the Secretary or the Attorney General from investigating and prosecuting, if appropriate, allegations of fraud or abuse arising from such overpayment.
Annual report
The Secretary shall annually submit to Congress a report on the use of recovery audit contractors under this subsection. Each such report shall include information on the performance of such contractors in identifying underpayments and overpayments and recouping overpayments, including an evaluation of the comparative performance of such contractors and savings to the program under this title.
.
Access to coordination of benefits contractor database
The Secretary of Health and Human Services shall provide for access by recovery audit contractors conducting audit and recovery activities under section 1893(h) of the Social Security Act, as added by subsection (a), to the database of the Coordination of Benefits Contractor of the Centers for Medicare & Medicaid Services with respect to the audit and recovery periods described in paragraph (4) of such section 1893(h).
Conforming amendments to current demonstration project
Section 306 of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Public Law 108–173; 117 Stat. 2256) is amended—
in subsection
(b)(2), by striking last for not longer than 3 years
and
inserting continue until contracts are entered into under section
1893(h) of the Social Security Act
; and
by striking subsection (f).
Funding for the Health Care Fraud and Abuse Control Account
Departments of Health and Human Services and Justice
In general
Section 1817(k)(3)(A)(i) of the Social Security Act (42 U.S.C. 1395i(k)(3)(A)(i)) is amended—
in the matter
preceding subclause (I), by inserting until expended
after
without further appropriation
;
in subclause (II),
by striking and
at the end;
in subclause (III)—
by striking
for each fiscal year after fiscal year 2003
and inserting
for each of fiscal years 2004, 2005, and 2006
; and
by striking the period at the end and inserting a semicolon; and
by adding at the end the following new subclauses:
for each of fiscal years 2007, 2008, 2009, and 2010, the limit under this clause for the preceding fiscal year, increased by the percentage increase in the consumer price index for all urban consumers (all items; United States city average) over the previous year; and
for each fiscal year after fiscal year 2010, the limit under this clause for fiscal year 2010.
.
Office of the Inspector General of the Department of Health and Human Services
Section 1817(k)(3)(A)(ii) of such Act (42 U.S.C. 1395i(k)(3)(A)(ii)) is amended—
in subclause (VI),
by striking and
at the end;
in subclause (VII)—
by striking
for each fiscal year after fiscal year 2002
and inserting
for each of fiscal years 2003, 2004, 2005, and 2006
; and
by striking the period at the end and inserting a semicolon; and
by adding at the end the following new subclauses:
for fiscal year 2007, not less than $160,000,000, increased by the percentage increase in the consumer price index for all urban consumers (all items; United States city average) over the previous year;
for each of fiscal years 2008, 2009, and 2010, not less than the amount required under this clause for the preceding fiscal year, increased by the percentage increase in the consumer price index for all urban consumers (all items; United States city average) over the previous year; and
for each fiscal year after fiscal year 2010, not less than the amount required under this clause for fiscal year 2010.
.
Federal Bureau of Investigation
Section 1817(k)(3)(B) of the Social Security Act (42 U.S.C. 1395i(k)(3)(B)) is amended—
in the matter
preceding clause (i), by inserting until expended
after
without further appropriation
;
in clause (vi), by
striking and
at the end;
in clause (vii)—
by striking
for each fiscal year after fiscal year 2002
and inserting
for each of fiscal years 2003, 2004, 2005, and 2006
; and
by striking the period at the end and inserting a semicolon; and
by adding at the end the following new clauses:
for each of fiscal years 2007, 2008, 2009, and 2010, the amount to be appropriated under this subparagraph for the preceding fiscal year, increased by the percentage increase in the consumer price index for all urban consumers (all items; United States city average) over the previous year; and
for each fiscal year after fiscal year 2010, the amount to be appropriated under this subparagraph for fiscal year 2010.
.
Implementation funding
For purposes of implementing the provisions of, and amendments made by, this title and titles I and II of this division, other than section 203, the Secretary of Health and Human Services shall provide for the transfer, in appropriate part from the Federal Hospital Insurance Trust Fund established under section 1817 of the Social Security Act (42 U.S.C. 1395i) and the Federal Supplementary Medical Insurance Trust Fund established under section 1841 of such Act (42 U.S.C. 1395t), of $45,000,000 to the Centers for Medicare & Medicaid Services Program Management Account for the period of fiscal years 2007 and 2008.
Medicaid and Other Health Provisions
Extension of Transitional Medical Assistance (TMA) and abstinence education program
Activities authorized by sections 510 and 1925 of the Social Security Act shall continue through June 30, 2007, in the manner authorized for fiscal year 2006, notwithstanding section 1902(e)(1)(A) of such Act, and out of any money in the Treasury of the United States not otherwise appropriated, there are hereby appropriated such sums as may be necessary for such purpose. Grants and payments may be made pursuant to this authority through the third quarter of fiscal year 2007 at the level provided for such activities through the third quarter of fiscal year 2006.
Grants for research on vaccine against Valley Fever
In general
In supporting research on the development of vaccines against human diseases, the Secretary of Health and Human Services shall make grants for the purpose of conducting research toward the development of a vaccine against coccidioidomycosis (commonly known as Valley Fever).
Sunset
No grant may be made under subsection (a) on or after October 1, 2012. The preceding sentence does not have any legal effect on payments under grants for which amounts appropriated under subsection (c) were obligated prior to such date.
Authorization of appropriations
For the purpose of making grants under subsection (a), there are authorized to be appropriated $40,000,000 for the period of fiscal years 2007 through 2012.
Change in threshold for Medicaid indirect hold harmless provision of broad-based health care taxes
Section 1903(w)(4)(C) of the Social Security Act (42 U.S.C. 1396b(w)(4)(C)) is amended—
by inserting
(i)
after (C)
; and
by adding at the end the following:
For purposes of clause (i), a
determination of the existence of an indirect guarantee shall be made under
paragraph (3)(i) of section 433.68(f) of title 42, Code of Federal Regulations,
as in effect on November 1, 2006, except that for portions of fiscal years
beginning on or after January 1, 2008, and before October 1, 2011, 5.5
percent
shall be substituted for 6 percent
each place it
appears.
.
DSH allotments for fiscal year 2007 for Tennessee and Hawaii
Section 1923(f)(6) of the Social Security Act (42 U.S.C. 1396r–4(f)(6)) is amended to read as follows:
Allotment adjustments for fiscal year 2007
Tennessee
In general
Only with respect to fiscal year 2007, the DSH allotment for Tennessee for such fiscal year, notwithstanding the table set forth in paragraph (2) or the terms of the TennCare Demonstration Project in effect for the State, shall be the greater of—
the amount that the Secretary determines is equal to the Federal medical assistance percentage component attributable to disproportionate share hospital payment adjustments for the demonstration year ending in 2006 that is reflected in the budget neutrality provision of the TennCare Demonstration Project; and
$280,000,000.
Limitation on amount of payment adjustments eligible for federal financial participation
Payment under section 1903(a) shall not be made to Tennessee with respect to the aggregate amount of any payment adjustments made under this section for hospitals in the State for fiscal year 2007 that is in excess of 30 percent of the DSH allotment for the State for such fiscal year determined pursuant to clause (i).
State plan amendment
The Secretary shall permit Tennessee to submit an amendment to its State plan under this title that describes the methodology to be used by the State to identify and make payments to disproportionate share hospitals, including children’s hospitals and institutions for mental diseases or other mental health facilities. The Secretary may not approve such plan amendment unless the methodology described in the amendment is consistent with the requirements under this section for making payment adjustments to disproportionate share hospitals. For purposes of demonstrating budget neutrality under the TennCare Demonstration Project, payment adjustments made pursuant to a State plan amendment approved in accordance with this subparagraph shall be considered expenditures under such project.
Offset of federal share of payment adjustments for fiscal year 2007 against Essential Access Hospital supplemental pool payments under the TennCare Demonstration Project
The total amount of Essential Access Hospital supplemental pool payments that may be made under the TennCare Demonstration Project for fiscal year 2007 shall be reduced on a dollar for dollar basis by the amount of any payments made under section 1903(a) to Tennessee with respect to payment adjustments made under this section for hospitals in the State for such fiscal year.
The sum of the total amount of payments made under section 1903(a) to Tennessee with respect to payment adjustments made under this section for hospitals in the State for fiscal year 2007 and the total amount of Essential Access Hospital supplemental pool payments made under the TennCare Demonstration Project for such fiscal year shall not exceed the State's DSH allotment for such fiscal year established under clause (i).
Hawaii
In general
Only with respect to fiscal year 2007, the DSH allotment for Hawaii for such fiscal year, notwithstanding the table set forth in paragraph (2), shall be $10,000,000.
State plan amendment
The Secretary shall permit Hawaii to submit an amendment to its State plan under this title that describes the methodology to be used by the State to identify and make payments to disproportionate share hospitals, including children’s hospitals and institutions for mental diseases or other mental health facilities. The Secretary may not approve such plan amendment unless the methodology described in the amendment is consistent with the requirements under this section for making payment adjustments to disproportionate share hospitals.
.
Certain Medicaid DRA technical corrections
Technical Corrections Relating to State Option for Alternative Premiums and Cost Sharing (Sections 6041 Through 6043)
Clarification of continued application of regular cost sharing rules for individuals with family income not exceeding 100 percent of the poverty line
Section 1916A of the Social Security Act, as inserted by section 6041(a) of the Deficit Reduction Act of 2005 and amended by sections 6042 and 6043 of such Act, is amended—
in subsection (a)(1)—
by
inserting but subject to paragraph (2),
after
1902(a)(10)(B),
; and
by
inserting and non-emergency services furnished in a hospital emergency
department for which cost sharing may be imposed under subsection (e)
after (c)
;
by redesignating paragraph (2) of subsection (a) as paragraph (3);
in subsection (a), by inserting after paragraph (1) the following:
Exemption for individuals with family income not exceeding 100 percent of the poverty line
In general
Paragraph (1) and subsection (d) shall not apply, and sections 1916 and 1902(a)(10)(B) shall continue to apply, in the case of an individual whose family income does not exceed 100 percent of the poverty line applicable to a family of the size involved.
Limit on aggregate cost sharing
To the extent cost sharing under subsection (c) and (e) or under section 1916 is imposed against individuals described in subparagraph (A), the limitation under subsection (b)(1)(B)(ii) on the total aggregate amount of cost sharing shall apply to such cost sharing for all individuals in a family described in subparagraph (A) in the same manner as such limitations apply to cost sharing and families described in subsection (b)(1)(B)(ii).
;
in subsections
(c)(2)(C) and (e)(2)(C), by inserting under subsection (a)(2)(B)
or
after cap on cost sharing applied
; and
in subsection
(e)(2)(A), by inserting who is not described in subparagraph (B)
after subsection (b)(1)
.
Clarification of treatment of non-preferred drug and non-emergency cost-sharing
Such section is further amended—
in subsections
(b)(1) and (b)(2), by striking , subject to subsections (c)(2) and
(e)(2)(A)
;
in subsection
(c)(1), in the matter preceding subparagraph (A), by striking least (or
less) costly effective
and inserting most (or more) cost
effective
;
in subsection
(c)(1)(B), by striking otherwise be imposed under
and inserting
be imposed under subsection (a) due to the application
of
;
in subsection
(c)(2)(B), by striking otherwise not subject to cost sharing due to the
application of subsection (b)(3)(B)
and inserting not subject to
cost sharing under subsection (a) due to the application of paragraph
(1)(B)
;
in subsection (e)(2)(A)—
by
amending the heading to read as follows: Individuals with family income between 100 and
150 percent of the poverty line.—
; and
by
striking under subsection (b)(1)
and inserting under
subsection (b)(1)(B)(ii)
;
in subsection
(e)(2)(B), by striking who is otherwise not subject to cost sharing
under subsection (b)(3)
and inserting described in subsection
(a)(2)(A) or who is not subject to cost sharing under subsection (b)(3)(B) with
respect to non-emergency services described in paragraph (1)
and
in subsection
(e)(2)(C), by inserting or section 1916
after subsection
(a)
.
Clarification of cost sharing rules applicable to disabled children provided medical assistance under the eligibility category added by the family opportunity act
Such section is further amended—
in subsection
(a)(1), in the second sentence, by striking section 1916(g)
and
inserting subsection (g) or (i) of section 1916
; and
in subsection (b)(3)—
in subparagraph (A), by adding at the end the following:
Disabled children who are receiving medical assistance by virtue of the application of sections 1902(a)(10)(A)(ii)(XIX) and 1902(cc).
; and
in subparagraph (B), by adding at the end the following:
Services furnished to disabled children who are receiving medical assistance by virtue of the application of sections 1902(a)(10)(A)(ii)(XIX) and 1902(cc).
.
Correction of iv–b references
Such section is further amended in subsection (b)(3)—
in subparagraph
(A)(i), by striking aid or assistance is made available under part B of
title IV to children in foster care
and inserting child welfare
services are made available under part B of title IV on the basis of being a
child in foster care
; and
in subparagraph
(B)(i), by striking aid or assistance is made available under part B of
title IV to children in foster care
and inserting child welfare
services are made available under part B of title IV on the basis of being a
child in foster care or
.
Non-emergency services
Section 1916A(e)(4)(A) of the
Social Security Act, as added by
section 6043(a) of the Deficit Reduction Act of 2005, is amended by striking
the physician determines
.
Effective date
The amendments made by this subsection shall take effect as if included in the amendments made by sections 6041(a) of the Deficit Reduction Act of 2005, except that insofar as such amendments are to, or relate to, subsection (c) or (e) of section 1916A of the Social Security Act, such amendments shall take effect as if included in the amendments made by section 6042 or 6043, respectively, of the Deficit Reduction Act of 2005.
Clarifying Treatment of Certain Annuities (Section 6012)
In General
Section 1917(c)(1)(F)(i) of the
Social Security Act (42 U.S.C.
1396p(c)(1)(F)(i)), as added by section 6012(b) of the Deficit Reduction Act of
2005, is amended by striking annuitant
and inserting
institutionalized individual
.
Effective date
The amendment made by paragraph (1) shall be effective as if included in the enactment of section 6012 of the Deficit Reduction Act of 2005.
Additional Miscellaneous Technical Corrections
Documentation (section 6036)
In general
Effective as if included in the amendment made by section 6036(a)(2) of the Deficit Reduction Act of 2005, section 1903(x) of the Social Security Act (42 U.S.C. 1396b(x)), as inserted by such section 6036(a)(2), is amended—
in
paragraph (1), by striking (i)(23)
and inserting
(i)(22)
;
in paragraph (2)—
in
the matter preceding subparagraph (A), by striking alien
and
inserting individual declaring to be a citizen or national of the United
States
;
by striking subparagraph (B) and inserting the following:
and is receiving—
disability insurance benefits under section 223 or monthly insurance benefits under section 202 based on such individual's disability (as defined in section 223(d)); or
supplemental security income benefits under title XVI;
;
in subparagraph (C)—
by
striking other
; and
by
striking had
and inserting has
;
by redesignating subparagraph (C) as subparagraph (D); and
by inserting after subparagraph (B) the following new subparagraph:
and with respect to whom—
child welfare services are made available under part B of title IV on the basis of being a child in foster care; or
adoption or foster care assistance is made available under part E of title IV; or
; and
in
paragraph (3)(C)(iii), by striking I–97
and inserting
I–197
.
Assurance of State foster care agency verification of citizenship or legal status
State plan amendment
Section 471(a) of the Social Security Act (42 U.S.C. 671(a)) is amended—
in paragraph (25),
by striking and
at the end;
in paragraph
(26)(C), by striking the period at the end and inserting ; and
;
and
by adding at the end the following:
provides that, with respect to any child in foster care under the responsibility of the State under this part or part B and without regard to whether foster care maintenance payments are made under section 472 on behalf of the child, the State has in effect procedures for verifying the citizenship or immigration status of the child.
.
Inclusion in reviews of child and family services programs
Section 1123A(b)(2)
of the Social Security Act (42 U.S.C. 1320a–2a(b)(2)) is amended by inserting
(which shall include determining whether the State program is in
conformity with the requirement of section 471(a)(27))
after
review
.
Effective date
The amendments made by this subparagraph shall take effect on the date that is 6 months after the date of the enactment of this Act.
Miscellaneous technical corrections
Effective as if included in the enactment of the Deficit Reduction Act of 2005 (Public Law 109–171), the following sections of such Act are amended as follows:
Section 5114(a)(2)
is amended by striking section 1842(b)(6)(F) of such Act (42 U.S.C.
1395u(b)(6)(F))
and inserting section 1842(b)(6) of such Act (42
U.S.C. 1395u(b)(6))
.
Section
6003(b)(2) is amended, by striking subsection (k)
and inserting
subsection (k)(1)
.
Sections
6031(b), 6032(b), and 6035(c) are each amended by striking section
6035(e)
and inserting section 6034(e)
.
Section 6034(b)
is amended by striking section 6033(a)
and inserting
section 6032(a)
.
Section 6036 is amended—
in subsection (b),
by striking section 1903(z)
and inserting section
1903(x)
; and
in subsection
(c), by striking (i)(23)
and inserting
(i)(22)
.
Effective as if
included in the amendment made by section 6015(a)(1) of the Deficit Reduction
Act of 2005, section 1919(c)(5)(A)(i)(II) of the Social Security Act (42 U.S.C.
1396r(c)(5)(A)(i)(II)) is amended by striking clause (v)
and
inserting subparagraph (B)(v)
.
Other Provisions
Gulf of Mexico Energy Security
Short title
This title may be cited
as the Gulf of Mexico Energy Security Act of 2006
.
Definitions
In this title:
181 area
The term 181 Area means the area identified in map 15, page 58, of the Proposed Final Outer Continental Shelf Oil and Gas Leasing Program for 1997–2002, dated August 1996, of the Minerals Management Service, available in the Office of the Director of the Minerals Management Service, excluding the area offered in OCS Lease Sale 181, held on December 5, 2001.
181 south area
The term 181 South Area means any area—
located—
south of the 181 Area;
west of the Military Mission Line; and
in the Central Planning Area;
excluded from the Proposed Final Outer Continental Shelf Oil and Gas Leasing Program for 1997–2002, dated August 1996, of the Minerals Management Service; and
included in the
areas considered for oil and gas leasing, as identified in map 8, page 37 of
the document entitled Draft Proposed Program Outer Continental Shelf Oil
and Gas Leasing Program 2007–2012
, dated February 2006.
Bonus or royalty credit
The term bonus or royalty credit means a legal instrument or other written documentation, or an entry in an account managed by the Secretary, that may be used in lieu of any other monetary payment for—
a bonus bid for a lease on the outer Continental Shelf; or
a royalty due on oil or gas production from any lease located on the outer Continental Shelf.
Central planning area
The term Central Planning Area means the
Central Gulf of Mexico Planning Area of the outer Continental Shelf, as
designated in the document entitled Draft Proposed Program Outer
Continental Shelf Oil and Gas Leasing Program 2007–2012
, dated February
2006.
Eastern planning area
The term Eastern Planning Area means the
Eastern Gulf of Mexico Planning Area of the outer Continental Shelf, as
designated in the document entitled Draft Proposed Program Outer
Continental Shelf Oil and Gas Leasing Program 2007–2012
, dated February
2006.
2002–2007 planning area
The term 2002–2007 planning area means any area—
located in—
the Eastern Planning Area, as designated in the Proposed Final Outer Continental Shelf Oil and Gas Leasing Program 2002–2007, dated April 2002, of the Minerals Management Service;
the Central Planning Area, as designated in the Proposed Final Outer Continental Shelf Oil and Gas Leasing Program 2002–2007, dated April 2002, of the Minerals Management Service; or
the Western Planning Area, as designated in the Proposed Final Outer Continental Shelf Oil and Gas Leasing Program 2002–2007, dated April 2002, of the Minerals Management Service; and
not located in—
an area in which no funds may be expended to conduct offshore preleasing, leasing, and related activities under sections 104 through 106 of the Department of the Interior, Environment, and Related Agencies Appropriations Act, 2006 (Public Law 109–54; 119 Stat. 521) (as in effect on August 2, 2005);
an
area withdrawn from leasing under the Memorandum on Withdrawal of
Certain Areas of the United States Outer Continental Shelf from Leasing
Disposition
, from 34 Weekly Comp. Pres. Doc. 1111, dated June 12, 1998;
or
the 181 Area or 181 South Area.
Gulf producing state
The term Gulf producing State means each of the States of Alabama, Louisiana, Mississippi, and Texas.
Military mission line
The term Military Mission Line means the north-south line at 86°41′ W. longitude.
Qualified outer continental shelf revenues
In general
The term qualified outer Continental Shelf revenues means—
in the case of each of fiscal years 2007 through 2016, all rentals, royalties, bonus bids, and other sums due and payable to the United States from leases entered into on or after the date of enactment of this Act for—
areas in the 181 Area located in the Eastern Planning Area; and
the 181 South Area; and
in the case of fiscal year 2017 and each fiscal year thereafter, all rentals, royalties, bonus bids, and other sums due and payable to the United States received on or after October 1, 2016, from leases entered into on or after the date of enactment of this Act for—
the 181 Area;
the 181 South Area; and
the 2002–2007 planning area.
Exclusions
The term qualified outer Continental Shelf revenues does not include—
revenues from the forfeiture of a bond or other surety securing obligations other than royalties, civil penalties, or royalties taken by the Secretary in-kind and not sold; or
revenues generated from leases subject to section 8(g) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(g)).
Coastal political subdivision
The term coastal political subdivision means a political subdivision of a Gulf producing State any part of which political subdivision is—
within the coastal zone (as defined in section 304 of the Coastal Zone Management Act of 1972 (16 U.S.C. 1453)) of the Gulf producing State as of the date of enactment of this Act; and
not more than 200 nautical miles from the geographic center of any leased tract.
Secretary
The term Secretary means the Secretary of the Interior.
Offshore oil and gas leasing in 181 Area and 181 south Area of Gulf of Mexico
181 Area Lease Sale
Except as provided in section 104, the Secretary shall offer the 181 Area for oil and gas leasing pursuant to the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) as soon as practicable, but not later than 1 year, after the date of enactment of this Act.
181 South Area Lease Sale
The Secretary shall offer the 181 South Area for oil and gas leasing pursuant to the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.) as soon as practicable after the date of enactment of this Act.
Leasing Program
The 181 Area and 181 South Area shall be offered for lease under this section notwithstanding the omission of the 181 Area or the 181 South Area from any outer Continental Shelf leasing program under section 18 of the Outer Continental Shelf Lands Act (43 U.S.C. 1344).
Conforming Amendment
Section 105 of the Department of the Interior,
Environment, and Related Agencies Appropriations Act, 2006 (Public Law 109–54;
119 Stat. 522) is amended by inserting (other than the 181 South Area
(as defined in section 102 of the Gulf of Mexico Energy Security Act of
2006))
after lands located outside Sale 181
.
Moratorium on oil and gas leasing in certain areas of Gulf of Mexico
In General
Effective during the period beginning on the date of enactment of this Act and ending on June 30, 2022, the Secretary shall not offer for leasing, preleasing, or any related activity—
any area east of the Military Mission Line in the Gulf of Mexico;
any area in the Eastern Planning Area that is within 125 miles of the coastline of the State of Florida; or
any area in the Central Planning Area that is—
within—
the 181 Area; and
100 miles of the coastline of the State of Florida; or
outside the 181 Area;
east of the western edge of the Pensacola Official Protraction Diagram (UTM X coordinate 1,393,920 (NAD 27 feet)); and
within 100 miles of the coastline of the State of Florida.
Military Mission Line
Notwithstanding subsection (a), the United States reserves the right to designate by and through the Secretary of Defense, with the approval of the President, national defense areas on the outer Continental Shelf pursuant to section 12(d) of the Outer Continental Shelf Lands Act (43 U.S.C. 1341(d)).
Exchange of Certain Leases
In general
The Secretary shall permit any person that, as of the date of enactment of this Act, has entered into an oil or gas lease with the Secretary in any area described in paragraph (2) or (3) of subsection (a) to exchange the lease for a bonus or royalty credit that may only be used in the Gulf of Mexico.
Valuation of existing lease
The amount of the bonus or royalty credit for a lease to be exchanged shall be equal to—
the amount of the bonus bid; and
any rental paid for the lease as of the date the lessee notifies the Secretary of the decision to exchange the lease.
Revenue distribution
No bonus or royalty credit may be used under this subsection in lieu of any payment due under, or to acquire any interest in, a lease subject to the revenue distribution provisions of section 8(g) of the Outer Continental Shelf Lands Act (43 U.S.C. 1337(g)).
Regulations
Not later than 1 year after the date of enactment of this Act, the Secretary shall promulgate regulations that shall provide a process for—
notification to the Secretary of a decision to exchange an eligible lease;
issuance of bonus or royalty credits in exchange for relinquishment of the existing lease;
transfer of the bonus or royalty credit to any other person; and
determining the proper allocation of bonus or royalty credits to each lease interest owner.
Disposition of qualified outer Continental Shelf revenues from 181 Area, 181 south Area, and 2002–2007 planning areas of Gulf of Mexico
In General
Notwithstanding section 9 of the Outer Continental Shelf Lands Act (43 U.S.C. 1338) and subject to the other provisions of this section, for each applicable fiscal year, the Secretary of the Treasury shall deposit—
50 percent of qualified outer Continental Shelf revenues in the general fund of the Treasury; and
50 percent of qualified outer Continental Shelf revenues in a special account in the Treasury from which the Secretary shall disburse—
75 percent to Gulf producing States in accordance with subsection (b); and
25 percent to provide financial assistance to States in accordance with section 6 of the Land and Water Conservation Fund Act of 1965 (16 U.S.C. 460l–8), which shall be considered income to the Land and Water Conservation Fund for purposes of section 2 of that Act (16 U.S.C. 460l–5).
Allocation Among Gulf Producing States and Coastal Political Subdivisions
Allocation among gulf producing states for fiscal years 2007 through 2016
In general
Subject to subparagraph (B), effective for each of fiscal years 2007 through 2016, the amount made available under subsection (a)(2)(A) shall be allocated to each Gulf producing State in amounts (based on a formula established by the Secretary by regulation) that are inversely proportional to the respective distances between the point on the coastline of each Gulf producing State that is closest to the geographic center of the applicable leased tract and the geographic center of the leased tract.
Minimum allocation
The amount allocated to a Gulf producing State each fiscal year under subparagraph (A) shall be at least 10 percent of the amounts available under subsection (a)(2)(A).
Allocation among gulf producing states for fiscal year 2017 and thereafter
In general
Subject to subparagraphs (B) and (C), effective for fiscal year 2017 and each fiscal year thereafter—
the amount made available under subsection (a)(2)(A) from any lease entered into within the 181 Area or the 181 South Area shall be allocated to each Gulf producing State in amounts (based on a formula established by the Secretary by regulation) that are inversely proportional to the respective distances between the point on the coastline of each Gulf producing State that is closest to the geographic center of the applicable leased tract and the geographic center of the leased tract; and
the amount made available under subsection (a)(2)(A) from any lease entered into within the 2002–2007 planning area shall be allocated to each Gulf producing State in amounts that are inversely proportional to the respective distances between the point on the coastline of each Gulf producing State that is closest to the geographic center of each historical lease site and the geographic center of the historical lease site, as determined by the Secretary.
Minimum allocation
The amount allocated to a Gulf producing State each fiscal year under subparagraph (A) shall be at least 10 percent of the amounts available under subsection (a)(2)(A).
Historical lease sites
In general
Subject to clause (ii), for purposes of subparagraph (A)(ii), the historical lease sites in the 2002–2007 planning area shall include all leases entered into by the Secretary for an area in the Gulf of Mexico during the period beginning on October 1, 1982 (or an earlier date if practicable, as determined by the Secretary), and ending on December 31, 2015.
Adjustment
Effective January 1, 2022, and every 5 years thereafter, the ending date described in clause (i) shall be extended for an additional 5 calendar years.
Payments to coastal political subdivisions
In general
The Secretary shall pay 20 percent of the allocable share of each Gulf producing State, as determined under paragraphs (1) and (2), to the coastal political subdivisions of the Gulf producing State.
Allocation
The amount paid by the Secretary to coastal political subdivisions shall be allocated to each coastal political subdivision in accordance with subparagraphs (B), (C), and (E) of section 31(b)(4) of the Outer Continental Shelf Lands Act (43 U.S.C. 1356a(b)(4)).
Timing
The amounts required to be deposited under paragraph (2) of subsection (a) for the applicable fiscal year shall be made available in accordance with that paragraph during the fiscal year immediately following the applicable fiscal year.
Authorized Uses
In general
Subject to paragraph (2), each Gulf producing State and coastal political subdivision shall use all amounts received under subsection (b) in accordance with all applicable Federal and State laws, only for 1 or more of the following purposes:
Projects and activities for the purposes of coastal protection, including conservation, coastal restoration, hurricane protection, and infrastructure directly affected by coastal wetland losses.
Mitigation of damage to fish, wildlife, or natural resources.
Implementation of a federally-approved marine, coastal, or comprehensive conservation management plan.
Mitigation of the impact of outer Continental Shelf activities through the funding of onshore infrastructure projects.
Planning assistance and the administrative costs of complying with this section.
Limitation
Not more than 3 percent of amounts received by a Gulf producing State or coastal political subdivision under subsection (b) may be used for the purposes described in paragraph (1)(E).
Administration
Amounts made available under subsection (a)(2) shall—
be made available, without further appropriation, in accordance with this section;
remain available until expended; and
be in addition to any amounts appropriated under—
the Outer Continental Shelf Lands Act (43 U.S.C. 1331 et seq.);
the Land and Water Conservation Fund Act of 1965 (16 U.S.C. 460l–4 et seq.); or
any other provision of law.
Limitations on Amount of Distributed Qualified Outer Continental Shelf Revenues
In general
Subject to paragraph (2), the total amount of qualified outer Continental Shelf revenues made available under subsection (a)(2) shall not exceed $500,000,000 for each of fiscal years 2016 through 2055.
Expenditures
For the purpose of paragraph (1), for each of fiscal years 2016 through 2055, expenditures under subsection (a)(2) shall be net of receipts from that fiscal year from any area in the 181 Area in the Eastern Planning Area and the 181 South Area.
Pro rata reductions
If paragraph (1) limits the amount of qualified outer Continental Shelf revenue that would be paid under subparagraphs (A) and (B) of subsection (a)(2)—
the Secretary shall reduce the amount of qualified outer Continental Shelf revenue provided to each recipient on a pro rata basis; and
any remainder of the qualified outer Continental Shelf revenues shall revert to the general fund of the Treasury.
Surface Mining Control and Reclamation Act Amendments of 2006
Short title
This title may be cited
as the Surface Mining Control and
Reclamation Act Amendments of 2006
.
Mining control and reclamation
Abandoned Mine Reclamation Fund and purposes
In general
Section 401 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1231) is amended—
in subsection (c)—
by striking paragraphs (2) and (6); and
by redesignating paragraphs (3), (4), and (5) and paragraphs (7) through (13) as paragraphs (2) through (11), respectively;
by striking subsection (d) and inserting the following:
Availability of moneys; no fiscal year limitation
In general
Moneys from the fund for expenditures under subparagraphs (A) through (D) of section 402(g)(3) shall be available only when appropriated for those subparagraphs.
No fiscal year limitation
Appropriations described in paragraph (1) shall be made without fiscal year limitation.
Other purposes
Moneys from the fund shall be available for all other purposes of this title without prior appropriation as provided in subsection (f).
;
in subsection (e)—
in the second
sentence, by striking the needs of such fund
and inserting
achieving the purposes of the transfers under section 402(h)
;
and
in the third
sentence, by inserting before the period the following: for the purpose
of the transfers under section 402(h)
; and
by adding at the end the following:
General Limitation on Obligation Authority
In general
From amounts deposited into the fund under subsection (b), the Secretary shall distribute during each fiscal year beginning after September 30, 2007, an amount determined under paragraph (2).
Amounts
For fiscal years 2008 through 2022
For each of fiscal years 2008 through 2022, the amount distributed by the Secretary under this subsection shall be equal to—
the amounts deposited into the fund under paragraphs (1), (2), and (4) of subsection (b) for the preceding fiscal year that were allocated under paragraphs (1) and (5) of section 402(g); plus
the amount needed for the adjustment under section 402(g)(8) for the current fiscal year.
Fiscal years 2023 and thereafter
For fiscal year 2023 and each fiscal year thereafter, to the extent that funds are available, the Secretary shall distribute an amount equal to the amount distributed under subparagraph (A) during fiscal year 2022.
Distribution
In general
Except as provided in subparagraph (B), for each fiscal year, of the amount to be distributed to States and Indian tribes pursuant to paragraph (2), the Secretary shall distribute—
the amounts allocated under paragraph (1) of section 402(g), the amounts allocated under paragraph (5) of section 402(g), and any amount reallocated under section 411(h)(3) in accordance with section 411(h)(2), for grants to States and Indian tribes under section 402(g)(5); and
the amounts allocated under section 402(g)(8).
Exclusion
Beginning on October 1, 2007, certified States shall be ineligible to receive amounts under section 402(g)(1).
Availability
Amounts in the fund available to the Secretary for obligation under this subsection shall be available until expended.
Addition
In general
Subject to subparagraph (B), the amount distributed under this subsection for each fiscal year shall be in addition to the amount appropriated from the fund during the fiscal year.
Exceptions
Notwithstanding paragraph (3), the amount distributed under this subsection for the first 4 fiscal years beginning on and after October 1, 2007, shall be equal to the following percentage of the amount otherwise required to be distributed:
50 percent in fiscal year 2008.
50 percent in fiscal year 2009.
75 percent in fiscal year 2010.
75 percent in fiscal year 2011.
.
Conforming amendment
Section 712(b) of the Surface Mining Control and
Reclamation Act of 1977 (30 U.S.C. 1302(b)) is amended by striking
section 401(c)(11)
and inserting section
401(c)(9)
.
Reclamation fee
Amounts
Fiscal years 2008–2012
Effective October 1, 2007, section 402(a) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(a)) is amended—
by striking
35
and inserting 31.5
;
by striking
15
and inserting 13.5
; and
by striking
10 cents
and inserting 9 cents
.
Fiscal years 2013–2021
Effective October 1, 2012, section 402(a) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(a)) (as amended by paragraph (1)) is amended—
by striking
31.5
and inserting 28
;
by striking
13.5
and inserting 12
; and
by striking
9 cents
and inserting 8 cents
.
Duration
Effective
September 30, 2007, section 402(b) of the Surface Mining Control and
Reclamation Act of 1977 (30 U.S.C. 1232(b)) (as amended by section 7007 of the
Emergency Supplemental Appropriations Act for Defense, the Global War on
Terror, and Hurricane Recovery, 2006 (Public Law 109–234; 120 Stat. 484)) is
amended by striking September 30, 2007
and all that follows
through the end of the sentence and inserting September 30,
2021.
.
Allocation of funds
Section 402(g) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(g)) is amended—
in paragraph (1)(D)—
by inserting
(except for grants awarded during fiscal years 2008, 2009, and 2010 to
the extent not expended within 5 years)
after this
paragraph
; and
by striking
in any area under paragraph (2), (3), (4), or (5)
and inserting
under paragraph (5)
;
by striking paragraph (2) and inserting:
In making the grants referred to in paragraph (1)(C) and the grants referred to in paragraph (5), the Secretary shall ensure strict compliance by the States and Indian tribes with the priorities described in section 403(a) until a certification is made under section 411(a).
;
in paragraph (3)—
in the matter
preceding subparagraph (A), by striking paragraphs (2) and
and
inserting paragraph
;
in subparagraph
(A), by striking 401(c)(11)
and inserting
401(c)(9)
; and
by adding at the end the following:
For the purpose of paragraph (8).
;
in paragraph (5)—
by inserting
(A)
after (5)
;
in the first
sentence, by striking 40
and inserting 60
;
in the last
sentence, by striking Funds allocated or expended by the Secretary under
paragraphs (2), (3), or (4)
and inserting Funds made available
under paragraph (3) or (4)
; and
by adding at the end the following:
Any amount that is reallocated and available under section 411(h)(3) shall be in addition to amounts that are allocated under subparagraph (A).
; and
by striking paragraphs (6) through (8) and inserting the following:
Any State with an approved abandoned mine reclamation program pursuant to section 405 may receive and retain, without regard to the 3-year limitation referred to in paragraph (1)(D), up to 30 percent of the total of the grants made annually to the State under paragraphs (1) and (5) if those amounts are deposited into an acid mine drainage abatement and treatment fund established under State law, from which amounts (together with all interest earned on the amounts) are expended by the State for the abatement of the causes and the treatment of the effects of acid mine drainage in a comprehensive manner within qualified hydrologic units affected by coal mining practices.
In this paragraph, the term qualified hydrologic unit means a hydrologic unit—
in which the water quality has been significantly affected by acid mine drainage from coal mining practices in a manner that adversely impacts biological resources; and
that contains land and water that are—
eligible pursuant to section 404 and include any of the priorities described in section 403(a); and
the subject of expenditures by the State from the forfeiture of bonds required under section 509 or from other States sources to abate and treat acid mine drainage.
In complying with the priorities described in section 403(a), any State or Indian tribe may use amounts available in grants made annually to the State or tribe under paragraphs (1) and (5) for the reclamation of eligible land and water described in section 403(a)(3) before the completion of reclamation projects under paragraphs (1) and (2) of section 403(a) only if the expenditure of funds for the reclamation is done in conjunction with the expenditure before, on, or after the date of enactment of the Surface Mining Control and Reclamation Act Amendments of 2006 of funds for reclamation projects under paragraphs (1) and (2) of section 403(a).
In making funds available under this title, the Secretary shall ensure that the grant awards total not less than $3,000,000 annually to each State and each Indian tribe having an approved abandoned mine reclamation program pursuant to section 405 and eligible land and water pursuant to section 404, so long as an allocation of funds to the State or tribe is necessary to achieve the priorities stated in paragraphs (1) and (2) of section 403(a).
Notwithstanding any other provision of law, this paragraph applies to the States of Tennessee and Missouri.
.
Transfers of interest earned by abandoned mine reclamation fund
Section 402 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232) is amended by striking subsection (h) and inserting the following:
Transfers of interest earned by fund
In general
Transfers to combined benefit fund
As soon as practicable after the beginning of fiscal year 2007 and each fiscal year thereafter, and before making any allocation with respect to the fiscal year under subsection (g), the Secretary shall use an amount not to exceed the amount of interest that the Secretary estimates will be earned and paid to the fund during the fiscal year to transfer to the Combined Benefit Fund such amounts as are estimated by the trustees of such fund to offset the amount of any deficit in net assets in the Combined Benefit Fund as of October 1, 2006, and to make the transfer described in paragraph (2)(A).
Transfers to 1992 and 1993 plans
As soon as practicable after the beginning of fiscal year 2008 and each fiscal year thereafter, and before making any allocation with respect to the fiscal year under subsection (g), the Secretary shall use an amount not to exceed the amount of interest that the Secretary estimates will be earned and paid to the fund during the fiscal year (reduced by the amount used under subparagraph (A)) to make the transfers described in paragraphs (2)(B) and (2)(C).
Transfers described
The transfers referred to in paragraph (1) are the following:
United mine workers of america combined benefit fund
A transfer to the United Mine Workers of America Combined Benefit Fund equal to the amount that the trustees of the Combined Benefit Fund estimate will be expended from the fund for the fiscal year in which the transfer is made, reduced by—
the amount the trustees of the Combined Benefit Fund estimate the Combined Benefit Fund will receive during the fiscal year in—
required premiums; and
payments paid by Federal agencies in connection with benefits provided by the Combined Benefit Fund; and
the amount the trustees of the Combined Benefit Fund estimate will be expended during the fiscal year to provide health benefits to beneficiaries who are unassigned beneficiaries solely as a result of the application of section 9706(h)(1) of the Internal Revenue Code of 1986, but only to the extent that such amount does not exceed the amounts described in subsection (i)(1)(A) that the Secretary estimates will be available to pay such estimated expenditures.
United mine workers of America 1992 benefit plan
A transfer to the United Mine Workers of America 1992 Benefit Plan, in an amount equal to the difference between—
the amount that the trustees of the 1992 UMWA Benefit Plan estimate will be expended from the 1992 UMWA Benefit Plan during the next calendar year to provide the benefits required by the 1992 UMWA Benefit Plan on the date of enactment of this subparagraph; minus
the amount that the trustees of the 1992 UMWA Benefit Plan estimate the 1992 UMWA Benefit Plan will receive during the next calendar year in—
required monthly per beneficiary premiums, including the amount of any security provided to the 1992 UMWA Benefit Plan that is available for use in the provision of benefits; and
payments paid by Federal agencies in connection with benefits provided by the 1992 UMWA benefit plan.
Multiemployer health benefit plan
A transfer to the Multiemployer Health
Benefit Plan established after July 20, 1992, by the parties that are the
settlors of the 1992 UMWA Benefit Plan referred to in subparagraph (B)
(referred to in this subparagraph and subparagraph (D) as the
Plan
), in an amount equal to the excess (if any) of—
the amount that the trustees of the Plan estimate will be expended from the Plan during the next calendar year, to provide benefits no greater than those provided by the Plan as of December 31, 2006; over
the amount that the trustees estimated the Plan will receive during the next calendar year in payments paid by Federal agencies in connection with benefits provided by the Plan.
Individuals considered enrolled
For purposes of subparagraph (C), any individual who was eligible to receive benefits from the Plan as of the date of enactment of this subsection, even though benefits were being provided to the individual pursuant to a settlement agreement approved by order of a bankruptcy court entered on or before September 30, 2004, will be considered to be actually enrolled in the Plan and shall receive benefits from the Plan beginning on December 31, 2006.
Adjustment
If, for any fiscal year, the amount of a transfer under subparagraph (A), (B), or (C) of paragraph (2) is more or less than the amount required to be transferred under that subparagraph, the Secretary shall appropriately adjust the amount transferred under that subparagraph for the next fiscal year.
Additional amounts
Previously credited interest
Notwithstanding any other provision of law, any interest credited to the fund that has not previously been transferred to the Combined Benefit Fund referred to in paragraph (2)(A) under this section—
shall be held in reserve by the Secretary until such time as necessary to make the payments under subparagraphs (A) and (B) of subsection (i)(1), as described in clause (ii); and
in the event that the amounts described in subsection (i)(1) are insufficient to make the maximum payments described in subparagraphs (A) and (B) of subsection (i)(1), shall be used by the Secretary to supplement the payments so that the maximum amount permitted under those paragraphs is paid.
Previously allocated amounts
All amounts allocated under subsection (g)(2) before the date of enactment of this subparagraph for the program described in section 406, but not appropriated before that date, shall be available to the Secretary to make the transfers described in paragraph (2).
Adequacy of previously credited interest
The Secretary shall—
consult with the trustees of the plans described in paragraph (2) at reasonable intervals; and
notify Congress if a determination is made that the amounts held in reserve under subparagraph (A) are insufficient to meet future requirements under subparagraph (A)(ii).
Additional reserve amounts
In addition to amounts held in reserve under subparagraph (A), there is authorized to be appropriated such sums as may be necessary for transfer to the fund to carry out the purposes of subparagraph (A)(ii).
Inapplicability of cap
The limitation described in subsection (i)(3)(A) shall not apply to payments made from the reserve fund under this paragraph.
Limitations
Availability of funds for next fiscal year
The Secretary may make transfers under subparagraphs (B) and (C) of paragraph (2) for a calendar year only if the Secretary determines, using actuarial projections provided by the trustees of the Combined Benefit Fund referred to in paragraph (2)(A), that amounts will be available under paragraph (1), after the transfer, for the next fiscal year for making the transfer under paragraph (2)(A).
Rate of contributions of obligors
In general
Rate
A transfer under paragraph (2)(C) shall not be made for a calendar year unless the persons that are obligated to contribute to the plan referred to in paragraph (2)(C) on the date of the transfer are obligated to make the contributions at rates that are no less than those in effect on the date which is 30 days before the date of enactment of this subsection.
Application
The contributions described in subclause (I) shall be applied first to the provision of benefits to those plan beneficiaries who are not described in paragraph (2)(C)(ii).
Initial contributions
In general
From the date of enactment of the Surface Mining Control and Reclamation Act Amendments of 2006 through December 31, 2010, the persons that, on the date of enactment of that Act, are obligated to contribute to the plan referred to in paragraph (2)(C) shall be obligated, collectively, to make contributions equal to the amount described in paragraph (2)(C), less the amount actually transferred due to the operation of subparagraph (C).
First calendar year
Calendar year 2006 is the first calendar year for which contributions are required under this clause.
Amount of contribution for 2006
Except as provided in subclause (IV), the amount described in paragraph (2)(C) for calendar year 2006 shall be calculated as if paragraph (2)(C) had been in effect during 2005.
Limitation
The contributions required under this clause for calendar year 2006 shall not exceed the amount necessary for solvency of the plan described in paragraph (2)(C), measured as of December 31, 2006 and taking into account all assets held by the plan as of that date.
Division
The collective annual contribution obligation required under clause (ii) shall be divided among the persons subject to the obligation, and applied uniformly, based on the hours worked for which contributions referred to in clause (i) would be owed.
Phase-in of transfers
For each of calendar years 2008 through 2010, the transfers required under subparagraphs (B) and (C) of paragraph (2) shall equal the following amounts:
For calendar year 2008, the Secretary shall make transfers equal to 25 percent of the amounts that would otherwise be required under subparagraphs (B) and (C) of paragraph (2).
For calendar year 2009, the Secretary shall make transfers equal to 50 percent of the amounts that would otherwise be required under subparagraphs (B) and (C) of paragraph (2).
For calendar year 2010, the Secretary shall make transfers equal to 75 percent of the amounts that would otherwise be required under subparagraphs (B) and (C) of paragraph (2).
Funding
In general
Subject to paragraph (3), out of any funds in the Treasury not otherwise appropriated, the Secretary of the Treasury shall transfer to the plans described in subsection (h)(2) such sums as are necessary to pay the following amounts:
To the Combined Fund (as defined in section 9701(a)(5) of the Internal Revenue Code of 1986 and referred to in this paragraph as the Combined Fund), the amount that the trustees of the Combined Fund estimate will be expended from premium accounts maintained by the Combined Fund for the fiscal year to provide benefits for beneficiaries who are unassigned beneficiaries solely as a result of the application of section 9706(h)(1) of the Internal Revenue Code of 1986, subject to the following limitations:
For fiscal year 2008, the amount paid under this subparagraph shall equal—
the amount described in subparagraph (A); minus
the amounts required under section 9706(h)(3)(A) of the Internal Revenue Code of 1986.
For fiscal year 2009, the amount paid under this subparagraph shall equal—
the amount described in subparagraph (A); minus
the amounts required under section 9706(h)(3)(B) of the Internal Revenue Code of 1986.
For fiscal year 2010, the amount paid under this subparagraph shall equal—
the amount described in subparagraph (A); minus
the amounts required under section 9706(h)(3)(C) of the Internal Revenue Code of 1986.
On certification by the trustees of any plan described in subsection (h)(2) that the amount available for transfer by the Secretary pursuant to this section (determined after application of any limitation under subsection (h)(5)) is less than the amount required to be transferred, to the plan the amount necessary to meet the requirement of subsection (h)(2).
To the Combined Fund, $9,000,000 on October 1, 2007, $9,000,000 on October 1, 2008, and $9,000,000 on October 1, 2009 (which amounts shall not be exceeded) to provide a refund of any premium (as described in section 9704(a) of the Internal Revenue Code of 1986) paid on or before September 7, 2000, to the Combined Fund, plus interest on the premium calculated at the rate of 7.5 percent per year, on a proportional basis and to be paid not later than 60 days after the date on which each payment is received by the Combined Fund, to those signatory operators (to the extent that the Combined Fund has not previously returned the premium amounts to the operators), or any related persons to the operators (as defined in section 9701(c) of the Internal Revenue Code of 1986), or their heirs, successors, or assigns who have been denied the refunds as the result of final judgments or settlements if—
prior to the date of enactment of this paragraph, the signatory operator (or any related person to the operator)—
had all of its beneficiary assignments made under section 9706 of the Internal Revenue Code of 1986 voided by the Commissioner of the Social Security Administration; and
was subject to a final judgment or final settlement of litigation adverse to a claim by the operator that the assignment of beneficiaries under section 9706 of the Internal Revenue Code of 1986 was unconstitutional as applied to the operator; and
on or before September 7, 2000, the signatory operator (or any related person to the operator) had paid to the Combined Fund any premium amount that had not been refunded.
Payments to States and Indian tribes
Subject to paragraph (3), out of any funds in the Treasury not otherwise appropriated, the Secretary of the Treasury shall transfer to the Secretary of the Interior for distribution to States and Indian tribes such sums as are necessary to pay amounts described in paragraphs (1)(A) and (2)(A) of section 411(h).
Limitations
Cap
The total amount transferred under this subsection for any fiscal year shall not exceed $490,000,000.
Insufficient amounts
In a case in which the amount required to be transferred without regard to this paragraph exceeds the maximum annual limitation in subparagraph (A), the Secretary shall adjust the transfers of funds so that—
each transfer for the fiscal year is a percentage of the amount described;
the amount is determined without regard to subsection (h)(5)(A); and
the percentage transferred is the same for all transfers made under this subsection for the fiscal year.
Availability of funds
Funds shall be transferred under paragraph (1) and (2) beginning in fiscal year 2008 and each fiscal year thereafter, and shall remain available until expended.
.
Objectives of Fund
Section 403 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1233) is amended—
in subsection (a)—
in paragraph (1)—
by
striking (1) the protection
and inserting the following:
the protection;
;
in
subparagraph (A) (as designated by clause (i)), by striking general
welfare,
; and
by adding at the end the following:
the restoration of land and water resources and the environment that—
have been degraded by the adverse effects of coal mining practices; and
are adjacent to a site that has been or will be remediated under subparagraph (A);
;
in paragraph (2)—
by
striking (2) the protection
and inserting the following:
the protection
;
in
subparagraph (A) (as designated by clause (i), by striking health,
safety, and general welfare
and inserting health and
safety
; and
by adding at the end the following:
the restoration of land and water resources and the environment that—
have been degraded by the adverse effects of coal mining practices; and
are adjacent to a site that has been or will be remediated under subparagraph (A); and
;
in paragraph (3), by striking the semicolon at the end and inserting a period; and
by striking paragraphs (4) and (5);
in subsection (b)—
by striking the
subsection heading and inserting Water supply restoration.—
; and
in paragraph (1),
by striking up to 30 percent of the
; and
in the second
sentence of subsection (c), by inserting , subject to the approval of
the Secretary,
after amendments
.
Reclamation of rural land
Administration
Section 406(h) of the Surface Mining
Control and Reclamation Act of 1977 (30 U.S.C. 1236(h)) is amended by striking
Soil Conservation Service
and inserting Natural Resources
Conservation Service
.
Authorization of appropriations for carrying out rural land reclamation
Section 406 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1236) is amended by adding at the end the following:
There are authorized to be appropriated to the Secretary of Agriculture, from amounts in the Treasury other than amounts in the fund, such sums as may be necessary to carry out this section.
.
Liens
Section 408(a) of the Surface Mining Control
and Reclamation Act of 1977 (30 U.S.C. 1238) is amended in the last sentence by
striking who owned the surface prior to May 2, 1977, and
.
Certification
Section 411 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1240a) is amended—
in subsection (a)—
by inserting
(1)
before the first sentence; and
by adding at the end the following:
The Secretary may, on the initiative of the Secretary, make the certification referred to in paragraph (1) on behalf of any State or Indian tribe referred to in paragraph (1) if on the basis of the inventory referred to in section 403(c) all reclamation projects relating to the priorities described in section 403(a) for eligible land and water pursuant to section 404 in the State or tribe have been completed.
The Secretary shall only make the certification after notice in the Federal Register and opportunity for public comment.
; and
by adding at the end the following:
Payments to States and Indian tribes
In general
Payments
In general
Notwithstanding section 401(f)(3)(B), from funds referred to in section 402(i)(2), the Secretary shall make payments to States or Indian tribes for the amount due for the aggregate unappropriated amount allocated to the State or Indian tribe under subparagraph (A) or (B) of section 402(g)(1).
Conversion as equivalent payments
Amounts allocated under subparagraphs (A) or (B) of section 402(g)(1) shall be reallocated to the allocation established in section 402(g)(5) in amounts equivalent to payments made to States or Indian tribes under this paragraph.
Amount due
In this paragraph, the term amount due means the unappropriated amount allocated to a State or Indian tribe before October 1, 2007, under subparagraph (A) or (B) of section 402(g)(1).
Schedule
Payments under subparagraph (A) shall be made in 7 equal annual installments, beginning with fiscal year 2008.
Use of funds
Certified states and indian tribes
A State or Indian tribe that makes a certification under subsection (a) in which the Secretary concurs shall use any amounts provided under this paragraph for the purposes established by the State legislature or tribal council of the Indian tribe, with priority given for addressing the impacts of mineral development.
Uncertified States and Indian tribes
A State or Indian tribe that has not made a certification under subsection (a) in which the Secretary has concurred shall use any amounts provided under this paragraph for the purposes described in section 403.
Subsequent State and Indian tribe share for certified States and Indian tribes
In general
Notwithstanding section 401(f)(3)(B), from funds referred to in section 402(i)(2), the Secretary shall pay to each certified State or Indian tribe an amount equal to the sum of the aggregate unappropriated amount allocated on or after October 1, 2007, to the certified State or Indian tribe under subparagraph (A) or (B) of section 402(g)(1).
Certified State or Indian tribe defined
In this paragraph the term certified State or Indian tribe means a State or Indian tribe for which a certification is made under subsection (a) in which the Secretary concurs.
Manner of payment
In general
Subject to subparagraph (B), payments to States or Indian tribes under this subsection shall be made without regard to any limitation in section 401(d) and concurrently with payments to States under that section.
Initial payments
The first 3 payments made to any State or Indian tribe shall be reduced to 25 percent, 50 percent, and 75 percent, respectively, of the amounts otherwise required under paragraph (2)(A).
Installments
Amounts withheld from the first 3 annual installments as provided under subparagraph (B) shall be paid in 2 equal annual installments beginning with fiscal year 2018.
Reallocation
In general
The amount allocated to any State or Indian tribe under subparagraph (A) or (B) of section 402(g)(1) that is paid to the State or Indian tribe as a result of a payment under paragraph (1) or (2) shall be reallocated and available for grants under section 402(g)(5).
Allocation
The grants shall be allocated based on the amount of coal historically produced before August 3, 1977, in the same manner as under section 402(g)(5).
.
Remining incentives
Title IV of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1231 et seq.) is amended by adding at the following:
Remining incentives
In general
Notwithstanding any other provision of this Act, the Secretary may, after opportunity for public comment, promulgate regulations that describe conditions under which amounts in the fund may be used to provide incentives to promote remining of eligible land under section 404 in a manner that leverages the use of amounts from the fund to achieve more reclamation with respect to the eligible land than would be achieved without the incentives.
Requirements
Any regulations promulgated under subsection (a) shall specify that the incentives shall apply only if the Secretary determines, with the concurrence of the State regulatory authority referred to in title V, that, without the incentives, the eligible land would not be likely to be remined and reclaimed.
Incentives
In general
Incentives that may be considered for inclusion in the regulations promulgated under subsection (a) include, but are not limited to—
a rebate or waiver of the reclamation fees required under section 402(a); and
the use of amounts in the fund to provide financial assurance for remining operations in lieu of all or a portion of the performance bonds required under section 509.
Limitations
Use
A rebate or waiver under paragraph (1)(A) shall be used only for operations that—
remove or reprocess abandoned coal mine waste; or
conduct remining activities that meet the priorities specified in paragraph (1) or (2) of section 403(a).
Amount
The amount of a rebate or waiver provided as an incentive under paragraph (1)(A) to remine or reclaim eligible land shall not exceed the estimated cost of reclaiming the eligible land under this section.
.
Extension of limitation on application of prohibition on issuance of permit
Section 510(e) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1260(e)) is amended by striking the last sentence.
Tribal regulation of surface coal mining and reclamation operations
In general
Section 710 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1300) is amended by adding at the end the following:
Tribal regulatory authority
Tribal regulatory programs
In general
Notwithstanding any other provision of law, an Indian tribe may apply for, and obtain the approval of, a tribal program under section 503 regulating in whole or in part surface coal mining and reclamation operations on reservation land under the jurisdiction of the Indian tribe using the procedures of section 504(e).
References to State
For purposes of this subsection and the implementation and
administration of a tribal program under title V, any reference to a
State
in this Act shall be considered to be a reference to a
tribe
.
Conflicts of interest
In general
The fact that an individual is a member of an Indian tribe does not in itself constitute a violation of section 201(f).
Employees of tribal regulatory authority
Any employee of a tribal regulatory authority shall not be eligible for a per capita distribution of any proceeds from coal mining operations conducted on Indian reservation lands under this Act.
Sovereign immunity
To receive primary regulatory authority under section 504(e), an Indian tribe shall waive sovereign immunity for purposes of section 520 and paragraph (4).
Judicial review
Civil actions
In general
After exhausting all tribal remedies with respect to a civil action arising under a tribal program approved under section 504(e), an interested party may file a petition for judicial review of the civil action in the United States circuit court for the circuit in which the surface coal mining operation named in the petition is located.
Scope of review
Questions of law
The United States circuit court shall review de novo any questions of law under clause (i).
Findings of fact
The United States circuit court shall review findings of fact under clause (i) using a clearly erroneous standard.
Criminal actions
Any criminal action brought under section 518 with respect to surface coal mining or reclamation operations on Indian reservation lands shall be brought in—
the United States District Court for the District of Columbia; or
the United States district court in which the criminal activity is alleged to have occurred.
Grants
In general
Except as provided in subparagraph (B), grants for developing, administering, and enforcing tribal programs approved in accordance with section 504(e) shall be provided to an Indian tribe in accordance with section 705.
Exception
Notwithstanding subparagraph (A), the Federal share of the costs of developing, administering, and enforcing an approved tribal program shall be 100 percent.
Report
Not later than 18 months after the date on which a tribal program is approved under subsection (e) of section 504, the Secretary shall submit to the appropriate committees of Congress a report, developed in cooperation with the applicable Indian tribe, on the tribal program that includes a recommendation of the Secretary on whether primary regulatory authority under that subsection should be expanded to include additional Indian lands.
.
Conforming amendment
Section 710(i) of the Surface Mining Control and
Reclamation Act of 1977 (30 U.S.C. 1300(i)) is amended in the first sentence by
striking , except
and all that follows through section
503
.
Coal Industry Retiree Health Benefit Act
Certain related persons and successors in interest relieved of liability if premiums prepaid
Combined Benefit Fund
Section 9704 of the Internal Revenue Code of 1986 (relating to liability of assigned operators) is amended by adding at the end the following new subsection:
Prepayment of premium liability
In general
If—
a payment meeting the requirements of paragraph (3) is made to the Combined Fund by or on behalf of—
any assigned operator to which this subsection applies, or
any related person to any assigned operator described in clause (i), and
the common parent of the controlled group of corporations described in paragraph (2)(B) is jointly and severally liable for any premium under this section which (but for this subsection) would be required to be paid by the assigned operator or related person,
Assigned operators to which subsection applies
In general
This subsection shall apply to any assigned operator if—
the assigned operator (or a related person to the assigned operator)—
made contributions to the 1950 UMWA Benefit Plan and the 1974 UMWA Benefit Plan for employment during the period covered by the 1988 agreement; and
is not a 1988 agreement operator,
the assigned operator (and all related persons to the assigned operator) are not actively engaged in the production of coal as of July 1, 2005, and
the assigned operator was, as of July 20, 1992, a member of a controlled group of corporations described in subparagraph (B).
Controlled group of corporations
A controlled group of corporations is described in this subparagraph if the common parent of such group is a corporation the shares of which are publicly traded on a United States exchange.
Coordination with repeal of assignments
A person shall not fail to be treated as an assigned operator to which this subsection applies solely because the person ceases to be an assigned operator by reason of section 9706(h)(1) if the person otherwise meets the requirements of this subsection and is liable for the payment of premiums under section 9706(h)(3).
Controlled group
For purposes of this subsection, the term controlled group of corporations has the meaning given such term by section 52(a).
Requirements
A payment meets the requirements of this paragraph if—
the amount of the payment is not less than the present value of the total premium liability under this chapter with respect to the Combined Fund of the assigned operators or related persons described in paragraph (1) or their assignees, as determined by the operator's or related person's enrolled actuary (as defined in section 7701(a)(35)) using actuarial methods and assumptions each of which is reasonable and which are reasonable in the aggregate, as determined by such enrolled actuary;
such enrolled actuary files with the Secretary of Labor a signed actuarial report containing—
the date of the actuarial valuation applicable to the report; and
a statement by the enrolled actuary signing the report that, to the best of the actuary's knowledge, the report is complete and accurate and that in the actuary’s opinion the actuarial assumptions used are in the aggregate reasonably related to the experience of the operator and to reasonable expectations; and
90 calendar days have elapsed after the report required by subparagraph (B) is filed with the Secretary of Labor, and the Secretary of Labor has not notified the assigned operator in writing that the requirements of this paragraph have not been satisfied.
Use of prepayment
The Combined Fund shall—
establish and maintain an account for each assigned operator or related person by, or on whose behalf, a payment described in paragraph (3) was made,
credit such account with such payment (and any earnings thereon), and
use all amounts in such account exclusively to pay premiums that would (but for this subsection) be required to be paid by the assigned operator.
.
Individual employer plans
Section 9711(c) of the Internal Revenue Code of 1986 (relating to joint and several liability) is amended to read as follows:
Joint and several liability of related persons
In general
Except as provided in paragraph (2), each related person of a last signatory operator to which subsection (a) or (b) applies shall be jointly and severally liable with the last signatory operator for the provision of health care coverage described in subsection (a) or (b).
Liability limited if security provided
If—
security meeting the requirements of paragraph (3) is provided by or on behalf of—
any last signatory operator which is an assigned operator described in section 9704(j)(2), or
any related person to any last signatory operator described in clause (i), and
the common parent of the controlled group of corporations described in section 9704(j)(2)(B) is jointly and severally liable for the provision of health care under this section which, but for this paragraph, would be required to be provided by the last signatory operator or related person,
Security
Security meets the requirements of this paragraph if—
the security—
is in the form of a bond, letter of credit, or cash escrow,
is provided to the trustees of the 1992 UMWA Benefit Plan solely for the purpose of paying premiums for beneficiaries who would be described in section 9712(b)(2)(B) if the requirements of this section were not met by the last signatory operator, and
is in an amount equal to 1 year of liability of the last signatory operator under this section, determined by using the average cost of such operator's liability during the prior 3 calendar years;
the security is in addition to any other security required under any other provision of this title; and
the security remains in place for 5 years.
Refunds of security
The remaining amount of any security provided under this subsection (and earnings thereon) shall be refunded to the last signatory operator as of the earlier of—
the termination of the obligations of the last signatory operator under this section, or
the end of the 5-year period described in paragraph (4)(C).
.
1992 UMWA Benefit Plan
Section 9712(d)(4) of the Internal Revenue Code of
1986 (relating to joint and several liability) is amended by adding at the end
the following new sentence: The provisions of section 9711(c)(2) shall
apply to any last signatory operator described in such section (without regard
to whether security is provided under such section, a payment is made under
section 9704(j), or both) and if security meeting the requirements of section
9711(c)(3) is provided, the common parent described in section 9711(c)(2)(B)
shall be exclusively responsible for any liability for premiums under this
section which, but for this sentence, would be required to be paid by the last
signatory operator or any related person.
.
Successor in interest
Section 9701(c) of the Internal Revenue Code of 1986 (relating to terms relating to operators) is amended by adding at the end the following new paragraph:
Successor in interest
Safe harbor
The term successor in interest shall not include any person who—
is an unrelated person to an eligible seller described in subparagraph (C); and
purchases for fair market value assets, or all of the stock, of a related person to such seller, in a bona fide, arm's-length sale.
Unrelated person
The term unrelated person means a purchaser who does not bear a relationship to the eligible seller described in section 267(b).
Eligible seller
For purposes of this paragraph, the term eligible seller means an assigned operator described in section 9704(j)(2) or a related person to such assigned operator.
.
Effective date
The amendments made by this section shall take effect on the date of the enactment of this Act, except that the amendment made by subsection (d) shall apply to transactions after the date of the enactment of this Act.
Transfers to funds; premium relief
Combined Fund
Federal transfers
Section 9705(b) of the Internal Revenue Code of 1986 (relating to transfers from Abandoned Mine Reclamation Fund) is amended—
in paragraph (1),
by striking section 402(h)
and inserting subsections (h)
and (i) of section 402
;
by striking paragraph (2) and inserting the following new paragraph:
Use of funds
Any amount transferred under paragraph (1) for any fiscal year shall be used to pay benefits and administrative costs of beneficiaries of the Combined Fund or for such other purposes as are specifically provided in the Acts described in paragraph (1).
; and
by striking
From Abandoned Mine
Reclamation Fund
in the heading thereof.
Modifications of premiums to reflect Federal transfers
Elimination of unassigned beneficiaries premium
Section 9704(d) of such Code (establishing unassigned beneficiaries premium) is amended to read as follows:
Unassigned beneficiaries premium
Plan years ending on or before September 30, 2006
For plan years ending on or before September 30, 2006, the unassigned beneficiaries premium for any assigned operator shall be equal to the applicable percentage of the product of the per beneficiary premium for the plan year multiplied by the number of eligible beneficiaries who are not assigned under section 9706 to any person for such plan year.
Plan years beginning on or after October 1, 2006
In general
For plan years beginning on or after October 1, 2006, subject to subparagraph (B), there shall be no unassigned beneficiaries premium, and benefit costs with respect to eligible beneficiaries who are not assigned under section 9706 to any person for any such plan year shall be paid from amounts transferred under section 9705(b).
Inadequate transfers
If, for any plan year beginning on or after October 1, 2006, the amounts transferred under section 9705(b) are less than the amounts required to be transferred to the Combined Fund under subsection (h)(2)(A) or (i) of section 402 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232)), then the unassigned beneficiaries premium for any assigned operator shall be equal to the operator's applicable percentage of the amount required to be so transferred which was not so transferred.
.
Premium accounts
Crediting of accounts
Section 9704(e)(1) of such Code (relating to premium
accounts; adjustments) is amended by inserting and amounts transferred
under section 9705(b)
after premiums received
.
Surpluses attributable to public funding
Section 9704(e)(3)(A) of such Code
is amended by adding at the end the following new sentence: Amounts
credited to an account from amounts transferred under section 9705(b) shall not
be taken into account in determining whether there is a surplus in the account
for purposes of this paragraph.
Applicable percentage
Section 9704(f)(2) of such Code (relating to annual adjustments) is amended by adding at the end the following new subparagraph:
In the case of plan years beginning on or after October 1, 2007, the total number of assigned eligible beneficiaries shall be reduced by the eligible beneficiaries whose assignments have been revoked under section 9706(h).
.
Assignments and reassignment
Section 9706 of the Internal Revenue Code of 1986 (relating to assignment of eligible beneficiaries) is amended by adding at the end the following:
Assignments as of October 1, 2007
In general
Subject to the premium obligation set forth in paragraph (3), the Commissioner of Social Security shall—
revoke all assignments to persons other than 1988 agreement operators for purposes of assessing premiums for plan years beginning on and after October 1, 2007; and
make no further assignments to persons other than 1988 agreement operators, except that no individual who becomes an unassigned beneficiary by reason of subparagraph (A) may be assigned to a 1988 agreement operator.
Reassignment upon purchase
This subsection shall not be construed to prohibit the reassignment under subsection (b)(2) of an eligible beneficiary.
Liability of persons during three fiscal years beginning on and after October 1, 2007
In the case of each of the fiscal years beginning on October 1, 2007, 2008, and 2009, each person other than a 1988 agreement operator shall pay to the Combined Fund the following percentage of the amount of annual premiums that such person would otherwise be required to pay under section 9704(a), determined on the basis of assignments in effect without regard to the revocation of assignments under paragraph (1)(A):
For the fiscal year beginning on October 1, 2007, 55 percent.
For the fiscal year beginning on October 1, 2008, 40 percent.
For the fiscal year beginning on October 1, 2009, 15 percent.
.
Effective date
The amendments made by this subsection shall apply to plan years of the Combined Fund beginning after September 30, 2006.
1992 UMWA Benefit and other plans
Transfers to plans
Section 9712(a) of the Internal Revenue Code of 1986 (relating to the establishment and coverage of the 1992 UMWA Benefit Plan) is amended by adding at the end the following:
Transfers under other Federal statutes
In general
The 1992 UMWA Benefit Plan shall include any amount transferred to the plan under subsections (h) and (i) of section 402 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232).
Use of funds
Any amount transferred under subparagraph (A) for any fiscal year shall be used to provide the health benefits described in subsection (c) with respect to any beneficiary for whom no monthly per beneficiary premium is paid pursuant to paragraph (1)(A) or (3) of subsection (d).
Special rule for 1993 plan
In general
The plan described in section 402(h)(2)(C) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(h)(2)(C)) shall include any amount transferred to the plan under subsections (h) and (i) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232).
Use of funds
Any amount transferred under subparagraph (A) for any fiscal year shall be used to provide the health benefits described in section 402(h)(2)(C)(i) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(h)(2)(C)(i)) to individuals described in section 402(h)(2)(C) of such Act (30 U.S.C. 1232(h)(2)(C)).
.
Premium adjustments
In general
Section 9712(d)(1) of such Code (relating to guarantee of benefits) is amended to read as follows:
In general
All 1988 last signatory operators shall be responsible for financing the benefits described in subsection (c) by meeting the following requirements in accordance with the contribution requirements established in the 1992 UMWA Benefit Plan:
The payment of a monthly per beneficiary premium by each 1988 last signatory operator for each eligible beneficiary of such operator who is described in subsection (b)(2) and who is receiving benefits under the 1992 UMWA benefit plan.
The provision of a security (in the form of a bond, letter of credit, or cash escrow) in an amount equal to a portion of the projected future cost to the 1992 UMWA Benefit Plan of providing health benefits for eligible and potentially eligible beneficiaries attributable to the 1988 last signatory operator.
If the amounts transferred under subsection (a)(3) are less than the amounts required to be transferred to the 1992 UMWA Benefit Plan under subsections (h) and (i) of section 402 of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232), the payment of an additional backstop premium by each 1988 last signatory operator which is equal to such operator's share of the amounts required to be so transferred but which were not so transferred, determined on the basis of the number of eligible and potentially eligible beneficiaries attributable to the operator.
.
Conforming amendments
Section 9712(d) of such Code is amended—
in
paragraph (2)(B), by striking prefunding
and inserting
backstop
, and
in
paragraph (3), by striking paragraph (1)(B)
and inserting
paragraph (1) (A)
.
Effective date
The amendments made by this paragraph shall apply to fiscal years beginning on or after October 1, 2010.
Other provisions
Board of trustees
Section 9702(b) of the Internal Revenue Code of 1986 (relating to board of trustees of the Combined Fund) is amended to read as follows:
Board of trustees
In general
For purposes of subsection (a), the board of trustees for the Combined Fund shall be appointed as follows:
2 individuals who represent employers in the coal mining industry shall be designated by the BCOA;
2 individuals designated by the United Mine Workers of America; and
3 individuals selected by the individuals appointed under subparagraphs (A) and (B).
Successor trustees
Any successor trustee shall be appointed in the same manner as the trustee being succeeded. The plan establishing the Combined Fund shall provide for the removal of trustees.
Special rule
If the BCOA ceases to exist, any trustee or successor under paragraph (1)(A) shall be designated by the 3 employers who were members of the BCOA on the enactment date and who have been assigned the greatest number of eligible beneficiaries under section 9706.
.
Enforcement of obligations
Failure to pay premiums
Section 9707(a) of the Internal Revenue Code of 1986 is amended to read as follows:
Failures to pay
Premiums for eligible beneficiaries
There is hereby imposed a penalty on the failure of any assigned operator to pay any premium required to be paid under section 9704 with respect to any eligible beneficiary.
Contributions required under the mining laws
There is hereby imposed a penalty on the failure of any person to make a contribution required under section 402(h)(5)(B)(ii) of the Surface Mining Control and Reclamation Act of 1977 to a plan referred to in section 402(h)(2)(C) of such Act. For purposes of applying this section, each such required monthly contribution for the hours worked of any individual shall be treated as if it were a premium required to be paid under section 9704 with respect to an eligible beneficiary.
.
Civil enforcement
Section 9721 of such Code is amended to read as follows:
Civil enforcement
The provisions of section 4301 of the Employee Retirement Income Security Act of 1974 shall apply, in the same manner as any claim arising out of an obligation to pay withdrawal liability under subtitle E of title IV of such Act, to any claim—
arising out of an obligation to pay any amount required to be paid by this chapter; or
arising out of an obligation to pay any amount required by section 402(h)(5)(B)(ii) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C. 1232(h)(5)(B)(ii)).
.
Other Provisions
Tobacco personal use quantity exception to not apply to delivery sales
Definitions
Section 801 of the Tariff Act of 1930 (19 U.S.C. 1681) is amended by adding at the end the following:
Delivery sale
The term delivery sale means any sale of cigarettes or a smokeless tobacco product to a consumer if—
the consumer submits the order for such sale by means of a telephone or other method of voice transmission, the mail, or the Internet or other online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made; or
the cigarettes or smokeless tobacco product is delivered by use of a common carrier, private delivery service, or the mail, or the seller is not in the physical presence of the buyer when the buyer obtains personal possession of the delivered cigarettes or smokeless tobacco product.
.
Inapplicability of exemptions from requirements for entry of certain cigarettes and smokeless tobacco products
Section 802(b)(1) of the Tariff Act of 1930 (19
U.S.C. 1681a(b)(1)) is amended by adding at the end the following new sentence:
The preceding sentence shall not apply to any cigarettes or smokeless
tobacco products sold in connection with a delivery sale.
.
State access to customs certifications
Section 802 of the Tariff Act of 1930 (19 U.S.C. 1681a) is amended by adding at the end the following new subsection:
State access to customs certifications
A State, through its Attorney General, shall be entitled to obtain copies of any certification required under subsection (c) directly—
upon request to the agency of the United States responsible for collecting such certification; or
upon request to the importer, manufacturer, or authorized official of such importer or manufacturer.
.
Enforcement provisions
Section 803(b) of the Tariff Act of 1930 (19 U.S.C. 1681b(b)) is amended—
in the first
sentence, by inserting before the period at the end the following: , or
to any State in which such tobacco product, cigarette papers, or tube is
found
; and
in the second
sentence, by inserting , or to any State,
after the
United States
.
Inclusion of smokeless tobacco
Sections 802 and
803(a) of the Tariff Act of 1930 (19 U.S.C. 1681a and 1681b(a)) (other than the
last sentence of section 802(b)(1), as added by subsection (b) of this section)
are further amended by inserting or smokeless tobacco products
after cigarettes
each place it appears.
Section 802 of such Act is further amended—
in subsection (a)—
in
paragraph (1), by inserting or section 4 of the Comprehensive Smokeless
Tobacco Health Education Act of 1986 (15 U.S.C. 4403), as the case may
be
after section 7 of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1335a)
;
in
paragraph (2), by inserting or section 3 of the Comprehensive Smokeless
Tobacco Health Education Act of 1986 (15 U.S.C. 4402), as the case may
be,
after section 4 of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1333)
; and
in
paragraph (3), by inserting or section 3(d) of the Comprehensive
Smokeless Tobacco Health Education Act of 1986 (15 U.S.C. 4402(d)), as the case
may be
after section 4(c) of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1333(c))
;
in subsection (b)—
in
the heading of paragraph (1), by inserting or smokeless tobacco
products
after cigarettes
; and
in the heading of paragraphs (2) and (3),
by inserting or smokeless
tobacco products
after cigarettes
; and
in subsection (c)—
in the heading, by inserting
or smokeless tobacco
product
after cigarette
;
in
paragraph (1), by inserting or section 4 of the Comprehensive Smokeless
Tobacco Health Education Act of 1986 (15 U.S.C. 4403), as the case may
be
after section 7 of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1335a)
;
in
paragraph (2)(A), by inserting or section 3 of the Comprehensive
Smokeless Tobacco Health Education Act of 1986 (15 U.S.C. 4402), as the case
may be,
after section 4 of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1333)
; and
in
paragraph (2)(B), by inserting or section 3(d) of the Comprehensive
Smokeless Tobacco Health Education Act of 1986 (15 U.S.C. 4402(d)), as the case
may be
after section 4(c) of the Federal Cigarette Labeling and
Advertising Act (15 U.S.C. 1333(c))
.
Section 803(b) of
such Act, as amended by subsection (d)(1) of this section, is further amended
by inserting , or any smokeless tobacco product,
after or
tube
the first place it appears.
The heading of title
VIII of such Act is amended by inserting and smokeless tobacco products
after
cigarettes
.
The heading of section 802 of such Act
is amended by inserting and
smokeless tobacco products
after
cigarettes
.
Application of civil penalties to relandings of tobacco products sold in a delivery sale
In general
Section 5761 of the Internal Revenue Code of 1986 (relating to civil penalties) is amended by redesignating subsections (d) and (e) as subsections (e) and (f), respectively, and inserting after subsection (c) the following new subsection:
Personal use quantities
In general
No quantity of tobacco products other than the quantity referred to in paragraph (2) may be relanded or received as a personal use quantity.
Exception for personal use quantity
Subsection (c) and section 5754 shall not apply to any person who relands or receives tobacco products in the quantity allowed entry free of tax and duty under chapter 98 of the Harmonized Tariff Schedule of the United States, and such person may voluntarily relinquish to the Secretary at the time of entry any excess of such quantity without incurring the penalty under subsection (c).
Special rule for delivery sales
In general
Paragraph (2) shall not apply to any tobacco product sold in connection with a delivery sale.
Delivery sale
For purposes of subparagraph (A), the term delivery sale means any sale of a tobacco product to a consumer if—
the consumer submits the order for such sale by means of a telephone or other method of voice transmission, the mail, or the Internet or other online service, or the seller is otherwise not in the physical presence of the buyer when the request for purchase or order is made, or
the tobacco product is delivered by use of a common carrier, private delivery service, or the mail, or the seller is not in the physical presence of the buyer when the buyer obtains personal possession of the tobacco product.
.
Conforming amendments
Subsection (c) of section 5761 of such Code is amended by striking the last two sentences.
Paragraph (1) of
section 5754(c) of such Code is amended by striking section
5761(c)
and inserting section 5761(d)
.
Effective date
The amendments made by this section shall apply with respect to goods entered, or withdrawn from warehouse for consumption, on or after the 15th day after the date of the enactment of this Act.
Ethanol Tariff Schedule
Headings 9901.00.50
and 9901.00.52 of the Harmonized Tariff Schedule of the United States are each
amended in the effective period column by striking 10/1/2007
each place it appears and inserting 1/1/2009
.
Withdrawal of certain Federal land and interests in certain Federal land from location, entry, and patent under the mining laws and disposition under the mineral and geothermal leasing laws
Definitions
In this section:
Bureau of Land Management land
The term Bureau of Land Management land means the Bureau of Land Management land and any federally-owned minerals located south of the Blackfeet Indian Reservation and east of the Lewis and Clark National Forest to the eastern edge of R. 8 W., beginning in T. 29 N. down to and including T. 19 N. and all of T. 18 N., R. 7 W.
Eligible Federal land
The term eligible Federal land means the Bureau of Land Management land and the Forest Service land, as generally depicted on the map.
Forest Service land
The term Forest Service land means—
the Forest Service land and any federally-owned minerals located in the Rocky Mountain Division of the Lewis and Clark National Forest, including the approximately 356,111 acres of land made unavailable for leasing by the August 28, 1997, Record of Decision for the Lewis and Clark National Forest Oil and Gas Leasing Environmental Impact Statement and that is located from T. 31 N. to T. 16 N. and R. 13 W. to R. 7 W.; and
the Forest Service land and any federally-owned minerals located within the Badger Two Medicine area of the Flathead National Forest, including—
the land located in T. 29 N. from the western edge of R. 16 W. to the eastern edge of R. 13 W.; and
the land located in T. 28 N., Rs. 13 and 14 W.
Map
The
term map means the map entitled Rocky Mountain Front
Mineral Withdrawal Area
and dated December 31, 2006.
Withdrawal
In general
Subject to valid existing rights, the eligible Federal land (including any interest in the eligible Federal land) is withdrawn from—
all forms of location, entry, and patent under the mining laws; and
disposition under all laws relating to mineral and geothermal leasing.
Availability of map
The map shall be on file and available for inspection in the Office of the Chief of the Forest Service.
Tax incentive for sale of existing mineral and geothermal rights to tax-exempt entities
Exclusion
For purposes of the Internal Revenue Code of 1986, gross income shall not include 25 percent of the qualifying gain from a conservation sale of a qualifying mineral or geothermal interest.
Qualifying gain
For purposes of this subsection, the term qualifying gain means any gain which would be recognized as long-term capital gain under such Code.
Conservation sale
For purposes of this subsection, the term conservation sale means a sale which meets the following requirements:
Transferee is an eligible entity
The transferee of the qualifying mineral or geothermal interest is an eligible entity.
Qualifying letter of intent required
At the time of the sale, such transferee provides the taxpayer with a qualifying letter of intent.
Nonapplication to certain sales
The sale is not made pursuant to an order of condemnation or eminent domain.
Qualifying mineral or geothermal interest
For purposes of this subsection—
In general
The term qualifying mineral or geothermal interest means an interest in any mineral or geothermal deposit located on eligible Federal land which constitutes a taxpayer’s entire interest in such deposit.
Entire interest
For purposes of subparagraph (A)—
an interest in any mineral or geothermal deposit is not a taxpayer’s entire interest if such interest in such mineral or geothermal deposit was divided in order to avoid the requirements of such subparagraph or section 170(f)(3)(A) of such Code, and
a taxpayer’s entire interest in such deposit does not fail to satisfy such subparagraph solely because the taxpayer has retained an interest in other deposits, even if the other deposits are contiguous with such certain deposit and were acquired by the taxpayer along with such certain deposit in a single conveyance.
Other definitions
For purposes of this subsection—
Eligible entity
The term eligible entity means—
a governmental unit referred to in section 170(c)(1) of such Code, or an agency or department thereof operated primarily for 1 or more of the conservation purposes specified in clause (i), (ii), or (iii) of section 170(h)(4)(A) of such Code, or
an entity which is—
described in section 170(b)(1)(A)(vi) or section 170(h)(3)(B) of such Code, and
organized and at all times operated primarily for 1 or more of the conservation purposes specified in clause (i), (ii), or (iii) of section 170(h)(4)(A) of such Code.
Qualifying letter of intent
The term qualifying letter of
intent means a written letter of intent which includes the following
statement: The transferee’s intent is that this acquisition will serve 1
or more of the conservation purposes specified in clause (i), (ii), or (iii) of
section 170(h)(4)(A) of the Internal Revenue Code of 1986, that the
transferee’s use of the deposits so acquired will be consistent with section
170(h)(5) of such Code, and that the use of the deposits will continue to be
consistent with such section, even if ownership or possession of such deposits
is subsequently transferred to another person.
.
Tax on subsequent transfers
In general
A tax is hereby imposed on any subsequent transfer by an eligible entity of ownership or possession, whether by sale, exchange, or lease, of an interest acquired directly or indirectly in—
a conservation sale described in paragraph (1), or
a transfer described in clause (i), (ii), or (iii) of subparagraph (D).
Amount of tax
The amount of tax imposed by subparagraph (A) on any transfer shall be equal to the sum of—
20 percent of the fair market value (determined at the time of the transfer) of the interest the ownership or possession of which is transferred, plus
the product of—
the highest rate of tax specified in section 11 of such Code, times
any gain or income realized by the transferor as a result of the transfer.
Liability
The tax imposed by subparagraph (A) shall be paid by the transferor.
Relief from liability
The person (otherwise liable for any tax imposed by subparagraph (A)) shall be relieved of liability for the tax imposed by subparagraph (A) with respect to any transfer if—
the transferee is an eligible entity which provides such person, at the time of transfer, a qualifying letter of intent,
in any case where the transferee is not an eligible entity, it is established to the satisfaction of the Secretary of the Treasury, that the transfer of ownership or possession, as the case may be, will be consistent with section 170(h)(5) of such Code, and the transferee provides such person, at the time of transfer, a qualifying letter of intent, or
tax has previously been paid under this paragraph as a result of a prior transfer of ownership or possession of the same interest.
Administrative provisions
For purposes of subtitle F of such Code, the taxes imposed by this paragraph shall be treated as excise taxes with respect to which the deficiency procedures of such subtitle apply.
Reporting
The Secretary of the Treasury may require such reporting as may be necessary or appropriate to further the purpose under this subsection that any conservation use be in perpetuity.
Effective dates
Moratorium
Subsection (b) shall take effect on the date of the enactment of this Act.
Tax incentive
Subsection (c) shall apply to sales occurring on or after the date of the enactment of this Act.
Continuing eligibility for certain students under District of Columbia School Choice Program
In general
Section 307(a)(4) of the DC School Choice Incentive Act
of 2003 (sec. 38—1851.06(a)(4), D.C. Official Code) is amended by striking
200 percent
and inserting the following: 200 percent (or,
in the case of an eligible student whose first year of participation in the
program is an academic year ending in June 2005 or June 2006 and whose second
or succeeding year is an academic year ending on or before June 2009, 300
percent)
.
Effective date
The amendment made by subsection (a) shall take effect as if included in the enactment of the DC School Choice Incentive Act of 2003.
Study on Establishing Uniform National Database on Elder Abuse
Study
In general
The Secretary of Health and Human Services, in consultation with the Attorney General, shall conduct a study on establishing a uniform national database on elder abuse.
Issues studied
The study conducted under paragraph (1) may consider the following:
Current methodologies used for collecting data on elder abuse, including a determination of the shortcomings, strengths, and commonalities of existing data collection efforts and reporting forms, and how a uniform national database would capitalize on such efforts.
The process by which uniform national standards for reporting on elder abuse could be implemented, including the identification and involvement of necessary stakeholders, financial resources needed, timelines, and the treatment of existing standards with respect to elder abuse.
Potential conflicts in Federal, State, and local laws, and enforcement and jurisdictional issues that could occur as a result of the creation of a uniform national database on elder abuse.
The scope, purpose, and variability of existing definitions used by Federal, State, and local agencies with respect to elder abuse.
Duration
The study conducted under paragraph (1) shall be conducted for a period not to exceed 2 years.
Report
Not later than 180 days after the completion of the study conducted under subsection (a)(1), the Secretary of Health and Human Services shall submit a report to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives containing the findings of the study, together with recommendations on how to implement a uniform national database on elder abuse.
Authorization
There are authorized to be appropriated to carry out this section, $500,000 for each of fiscal years 2007 and 2008.