Pension Benefits Protection Act of 2005

Mr. President, today I introduce the Trade Adjustment Assistance for Firms Reorganization Act.

The Trade Adjustment Assistance for Firms program assists hundreds of mostly small and medium-sized manufacturing and agricultural companies in Montana and nationwide when they face layoffs and lost sales due to import competition. Qualifying companies develop adjustment plans and receive technical assistance to become more competitive, so that they can retain and expand employment.

The program is very cost effective. It requires the firms being helped to match the Federal assistance with their own funds, and it pays the government back in federal and State tax revenues when the firms succeed.

For example, TAA for Firms is helping Montola Growers from Culbertson, Montana, to develop cosmetic applications for its safflower oil. And it is helping Porterbilt Company of Hamilton to expand its product line.

Currently, TAA for Firms clients receive assistance preparing petitions and adjustment plans from twelve Trade Adjustment Assistance Centers, which are Commerce Department contractors. Program and policy decisions are made by a small headquarters staff in the Commerce Department's Economic Development Administration.

In the Trade Act of 2002, Congress voted to reauthorize this important program for seven years and to increase its authorized funding level. The program seemed headed toward some years of smooth sailing. But it turns out that is not the case.

For reasons unrelated to TAA for Firms, EDA began more than a year ago to move all its headquarters programs to its six regional offices. For TAA for Firms, that means clients will still get the same local services from the TAACs, but decisions will be made in six regional offices plus a national policy office. The likely result is more personnel needed to run the program, more layers of government, less centralized and consistent decision making, and less accountability-- all without any likely improvement in customer service.

In preparation for this reorganization, EDA transferred or otherwise eliminated most of its experienced TAA staff in the Washington office. But to date it has not completed the transfer and hired or trained the necessary regional staff. So the program is in limbo.

Meanwhile, the President recently announced a multi-agency consolidation of economic development programs that will eliminate EDA and its regional offices. Not surprisingly, the latest word from EDA is that plans to complete the move of TAA for Firms to the regional offices are now on indefinite hold. The President's fiscal year 2006 budget zeroes out TAA for Firms, even though Congress has authorized the program through fiscal year 2007. With funding in doubt and the Washington-based management structure for TAA for Firms already largely dismantled, this program is on the verge of a crisis.

TAA for Firms was not broken until someone decided to fix it. Now it is doomed to stay in limbo unless Congress acts to clean up the mess.

The bill I am introducing today solves these problems by moving administration of the TAA for Firms program from EDA into a different part of the Commerce Department--the International Trade Administration. I introduced this same bill last year with 15 co- sponsors.

Relocating the program to ITA makes sense. ITA has experience running this program, which was located there prior to 1990. Relocating TAA for Firms to ITA will result in fewer lays of government and more centralized and accountable program management than running it through EDA's regional offices or some new economic development agency.

Relocating the program also creates synergies by allowing better coordination of the TAA for Firms program with other trade and trade remedy programs administered by ITA. And it enhances the ability of the Finance Committee to carry out its oversight responsibilities for this program and for trade policy in general.

I do not want to see this important TAA program die of neglect. This legislation is a simple matter of good, sensible government. I encourage my colleagues to lend it their support.

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

Mr. President, today I introduce the Trade Adjustment Assistance Equity for Service Workers Act.

Frankly, I am disappointed to be here introducing this bill yet again.

Just last week, the substance of the bill was adopted by a majority of members of the Finance Committee as an amendment to the implementing legislation for the United States-Central America-Dominican Republic Free Trade Agreement. But today, the administration sent us the final implementing bill with the amendment stripped out.

President Bush likes to say that trade is for everyone. That we all share the benefits, including workers. And he claims to care a lot about having a skilled workforce that can keep American businesses competitive in global markets.

This amendment presented the President with the perfect opportunity to put his money where his mouth is.

He could have said to the American people--as President Clinton did when Congress considered the NAFTA--that just as all Americans share in the benefits of trade, we all bear a responsibility for its costs. Trade liberalization and trade adjustment go hand in hand. And then he could have provided America's service sector workers with access to the one program designed to make that happen--Trade Adjustment Assistance.

But by submitting the CAFTA implementing bill stripped of the Trade Adjustment Assistance amendment passed by the Finance Committee, he chose not to.

Since 1962, Trade Adjustment Assistance--what we call ``TAA''--has provided retraining, income support, and other benefits so that workers who lose their jobs due to trade can make a new start.

The rationale for TAA is simple. When our government pursues trade liberalization, we create benefits for the economy as a whole. But there is always some dislocation from trade.

When he created the TAA program, President Kennedy explained that the Federal Government has an obligation ``to render assistance to those who suffer as a result of national trade policy.''

For more than 40 years, we have met that obligation through TAA, which is principally a retraining program designed to update worker skills.

The TAA program has not been static over time. Congress periodically revises the program to meet new economic realities. Most recently, in the Trade Act of 2002, Congress completed the most comprehensive overhaul and expansion of the TAA program since its inception.

I am proud to have played a leading role in passing this landmark legislation. But I am also the first to admit that our work is not done. Economic realities continue to change, and TAA must continue to change with them.

One fundamental aspect of TAA that has remained unchanged since 1962 is its focus on manufacturing. We only give TAA benefits to workers who make ``articles.''

Excluding service workers from TAA may have made sense in 1962, when most non-farm jobs were in manufacturing and most services were not traded across national borders.

But today, most American jobs are in the service sector. And the market for many services is becoming just as global as the market for manufactured goods.

In 2002, the service sector accounted for three quarters of U.S. private sector gross domestic product and nearly 80 percent of non-farm private employment.

Trade in services is a net plus for the U.S. economy. Although trade in goods continues to dominate, services accounted for 29 percent of the value of total U.S. exports in 2002 and the service sector generated a trade surplus of $74 billion.

Just as we have seen with trade in manufactured goods, however, there are winners and losers from trade. Trade in services will inevitably cost some workers their jobs.

Indeed, there have been some well-publicized examples in the papers. Software sign. Technical support. Accounting and tax preparation services. Not long ago, a group of call center workers in Kalispell, MT saw their jobs move to Canada and India.

Examples abound of service sector jobs--even high tech jobs-- relocating overseas. A series of studies estimate that between a half million and over 3 million U.S. service sector jobs would be moved offshore in the next 5 to 10 years.

That doesn't mean the total number of jobs in the U.S. economy is shrinking. But the fact that jobs may be available in a different field is cold comfort to a worker whose own skills are no longer in demand.

That is why this legislation is so important. It is a simple matter of equity.

When a factory relocates to another country, those workers are eligible for TAA. But when a call center moves to another country, those workers are not eligible for TAA. They should be.

The benefits service workers will receive under this legislation would be exactly the same as those that trade-impacted manufacturing workers now receive. They include retraining, income support, job search and relocation allowance, and a health coverage tax credit.

Hard working American service workers deserve this safety net. These benefits will always be second best to a job. But they can really make a difference in helping workers make a new start.

Truthfully, I am mystified by why the President so cavalierly dropped the TAA for Services amendment and let this opportunity pass him by. His actions are entirely inconsistent with his stated desire to make trade benefit all Americans. But, sadly, this has become a pattern.

Despite the obvious benefits of the TAA program, the Bush Administration fought tooth and nail against every penny, and against every provision in what became the Trade Adjustment Assistance Reform Act of 2002. Extending TAA to service workers was one of many needed improvements that was struck in the final version of the bill.

Again in the last Congress, the extension of TAA to service workers was offered as an amendment to the JOBS Act and opposed by the Administration. It garnered 54 votes from both sides ofthe aisle-- failing only on a technicality.

The world is changing and TAA must keep up with the times. Last year's Senate vote and this year's Finance Committee vote make clear that there is wide support for extending TAA to service workers. I truly believe this bill's time has come. I will work hard to move this legislation this year.

I want to thank Senators Coleman and Wyden for co-sponsoring this legislation. They have been stalwart supporters in the fight to bring equity to service workers. I look forward to working with them to make TAA for service workers a reality.

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

Mr. President, I am pleased to introduce the Pascua Yaqui Mineral Rights Act of 2005 to provide for acquisition of subsurface mineral interests in land owned by the Pascua Yaqui tribe and land held in trust for the Tribe.

The Pascua Yaqui tribe has purchased in fee four parcels of land, totaling approximately 436 acres, from the State of Arizona. These parcels are adjacent to the Tribe's reservation near Tucson, AZ. The Tribe subsequently applied to have these lands taken into trust pursuant to the 25 CFR Part 151 process. The Bureau of Indian Affairs approved the trust application. However, the State of Arizona objected because it still owns the subsurface mineral rights when it conveys its Trust lands. Based on the State of Arizona's objection, the Tribe's trust application was stayed pending resolution of the mineral rights title issue. Arizona law prevents the State from selling these mineral interests and I understand that the only way they can be acquired is through an act of condemnation brought by the United States pursuant to 40 U.S.C. Sec. 3113. The State of Arizona has conditionally consented to a condemnation action.

It has since been discovered that an additional 140 acres of the reservation was also former State of Arizona trust land that was purchased in fee by the Tribe and taken into trust without obtaining the mineral estate. The State of Arizona has also conditionally consented to a condemnation action with regard to these additional 140 acres.

In additional to the mineral interests condemnation, this legislation covers another subject. Under 360 acres of the reservation, the United States owns the mineral interests for itself, rather than in trust for the tribe. Although that acreage was originally purchased in fee, it was previously patented by the U.S. and the U.S. retained the mineral interests to that property for its own benefit, currently administered by the Bureau of Land Management. This legislation would authorize the Bureau of Land Management to transfer those mineral interests to the U.S., to be held in trust for the Pascua Yaqui tribe.

The result of the legislation I introduce today would be to allow the United States to obtain and/or consolidate ownership of the mineral interest only, in its name, in trust for the Pascua Yaqui tribe. These mineral interests are under the surface of land already either owned by the Pascua Yaqui tribe, or held in trust for the Tribe by the United States.

Finally, under the terms of its current gaming compact with the State of Arizona, the Tribe has already constructed the maximum number of casinos it can operate on its reservation at this time. This bill will not authorize additional reservation casinos.

I look forward to working with my colleagues to enact this legislation.

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

Mr. President, I am pleased to join in sponsoring the Community Broadband Act of 2005. In the simplest of terms, this bill would ensure that any town, city, or county that wishes to offer high- speed Internet services to its citizens can do so. The bill also would ensure fairness by requiring municipalities that offer high-speed Internet services do so in compliance with all Federal and State telecommunications laws and in a nondiscriminatory manner.

This bill is needed if we are to meet President Bush's call for ``universal, affordable access for broadband technology by the year 2007.'' When President Bush announced this nationwide goal in 2004, the country was ranked 10th in the world for high-speed Internet penetration. Today, the country is ranked 16th. This is unacceptable for a country that should lead the world in technical innovation, economic development, and international competitiveness.

Many of the countries outpacing the United States in the deployment of high-speed Internet services, including Canada, Japan, and South Korea, have successfully combined municipal systems with privately deployed networks to wire their countries. As a country, we cannot afford to cut off any successful strategy if we want to remain internationally competitive.

I recognize that our Nation has a long and successful history of private investment in critical communications infrastructure. That history must be respected, protected, and continued. However, when private industry does not answer the call because of market failures or other obstacles, it is appropriate and even commendable, for the people acting through their local governments to improve their lives by investing in their own future. In many rural towns, the local government's high-speed Internet offering may be its citizens only option to access the World Wide Web.

Despite this situation, a few incumbent providers of traditional telecommunications services have attempted to stop local government deployment of community high speed Internet services. The bill would do nothing to limit their ability to compete. In fact, the bill would provide them an incentive to enter more rural areas and deploy services in partnership with local governments. This partnership will not only reduce the costs to private firms, but also ensure wider deployment of rural services. Additionally, the bill would aid private providers by prohibiting a municipality when acting as both ``regulator'' and ``competitor'' from discriminating against competitors in favor of itself.

Several newspapers have endorsed the concept of allowing municipalities to choose whether to offer high speed Internet services. USA Today rightfully questioned in an editorial, ``Why shouldn't citizens be able to use their own resources to help themselves?'' The Washington Post editorialized that the offering of high speed Internet services by localities is, ``. . . the sort of municipal experiment we hope will spread.'' The San Jose Mercury News stated that a ban on localities ability to offer such services is ``bad for consumers, bad for technology and bad for America's hopes of catching up to other countries in broadband deployment.'' Finally, the Tampa Tribune lectured Federal and State legislators, ``don't prohibit local elected officials from providing a service their communities need.''

My home State of Arizona boasts the largest approved municipal broadband system in the United States, for example. The city of Tempe's wireless system will serve all of the city's 40 square miles and a population of 159,000, including the campus of Arizona State University. Citizens will have Internet access from anywhere at any time, and police, fire, water and traffic services personnel will use the system to enhance their efficiency.

In addition to Tempe, several Native American tribal governments offer high-speed Internet access services to their citizens. This bill would ensure that such offerings could continue to assist Indian country and their ability to connect to the Internet.

Our country faces some real challenges. We need to find ways to use technology to help our citizens better compete. We need to help our businesses capitalize on their ingenuity so that they can become more internationally competitive. That is why we need to do all we can to eliminate barriers to competition and create incentives for the delivery of high-speed Internet services for public suppliers of broadband services, private suppliers of broadband services, and public-private partnerships as well.

I hope my colleagues will join us in sponsoring the Community Broadband Act of 2005.

Mr. President, I am pleased to introduce the National Indian Gaming Commission Accountability Act of 2005 to amend provisions of the Indian Gaming Regulatory Act regarding NIGC funding and accountability.

The Indian gaming industry has undergone tremendous growth since the enactment of the Indian Gaming Regulatory Act in 1988. The regulatory responsibilities of the NIGC, the Federal agency responsible for oversight of the industry, has likewise grown. In recent years the NIGC's budgeting needs have consistently exceeded the $8 million statutory cap, necessitating short-term authorizations to exceed the cap to enable it to adequately enforce the Act.

Rather than merely raising the cap on funding, this legislation amends IGRA's equation for funding the NIGC by allowing the funding to adjust in direct proportion to the revenues of the Indian gaming industry, with funding expanding or contracting as the Indian gaming industry grows or recedes. Under that equation--which provides that fees cannot exceed .08 percent of gross gaming revenues--the NIGC's budget for fiscal 2007 would be capped at approximately $14.5 million.

As the agency's needs have grown, so has the scrutiny of the regulated community and affected parties. It is therefore appropriate that the agency's budgetary choices and program plans be subject to transparency. Therefore, this legislation increases not only the agency's funding, but also its accountability by directing that the NIGC be subject to the Government Performance and Results Act (GPRA). As a result, the agency would be required to develop a Strategic Plan, and annual performance plans and performance reports, all of which will provide critical information to the regulated stakeholders.

I look forward to working with my colleagues on both sides of the aisle to enact this timely and balanced legislation. I ask unanimous consent that the full text of the bill be printed in the Record.

Mr. President, I rise today to introduce a piece of legislation to fix a huge oversight in pension policy.

In the early 1990s, a large number of U.S. companies began a process of switching their traditional defined benefit pension plans to what's referred to as ``cash balance'' pension plans. A cash balance pension is insured, like a traditional plan, through the PBGC. However, it looks more like a defined contribution plan to participants because the benefit is expressed as some percent of play plus some guaranteed interest rate. This isn't necessarily a bad idea, in and of itself. However, in practice, many of the employees working for these companies were not told what these changes would mean for them. Some companies had their employees work for years without earning any more benefits. Many of those employees didn't figure that out for a very long time. Unfortunately, their lack of understanding in this situation was a key benefit to management. However, once they figured out what was happening, the retirees were furious.

As two consultants who helped put these plans together said at an Actuaries conference in 1998:

``I've been involved in cash balance plans five or six

years down the road and what I have found is that while

employees understand it, it is not until they are actually

ready to retire that they understand how little they are

actually getting.''

``Right, but they're happy while they're employed.''

One of the most abusive practices in cash balance conversions is known as ``wear away. `` The company freezes the value of the benefits employees already earned, which by law cannot be taken away once given. However, the employer opens a cash balance account for that worker at a much lower dollar level. So they end up working for years contributing to this lower cash balance account, not realizing that contribution is meaningless because their old benefits were higher. At the same time, younger workers do get money added to their account every day. This is clearly age discrimination, and bad pension policy.

In 1999, I introduced a bill to make it illegal for corporations to wear away the benefits of older workers during conversions to cash balance plans. I offered my bill as an amendment. Forty-eight Senators, including 3 Republicans, voted to waive the budget point of order so we could consider this amendment. We did not have enough votes then, but I believe the tide is turning.

After that vote, more and more stories came out about how many workers were losing their pensions. In September of 1999, the Secretary of the Treasury put a moratorium on conversions from defined benefit plans to cash balance plans. That moratorium has

been in effect now for over three years. In April of 2000, I offered a Sense-of-the-Senate resolution to stop this practice, and it passed the Senate unanimously.

There are hundreds of age discrimination complaints currently pending before the EEOC based on some of these abusive cash balance conversions. Clearly, something must be done to address this issue that's been floating around now unresolved for over five years.

Before, I said that wear-away is the least fair practice during conversion. And I have to say that now, public sentiment is really coming around to acknowledge that unfairness. However, aside from wear- away, there's another problem in shifting from a traditional pension to cash balance. In a traditional plan, you accrue most of the benefits toward the end of your career, because there's usually some kind of formula that multiplies top pay times years of service. People tend to earn more salary toward the end of their careers, and if that is multiplied times more years served, the pension grows quickly in later years. But in a cash balance plan, younger workers do better because they are given a flat percent of pay plus some guaranteed interest credit. Interest is good for young people, they have many years to accrue and compound it. So if you get caught in mid-life, mid-career in one of these transitions, you get the downside of both plans.

Before I go any further, I want to be clear on one point--cash balance pensions can be a great deal for workers. Some. And they may help fill a needed niche in the pension world to cover the half of the workforce that currently has no pension. But I will continue my long battle to oppose the unilateral decision of a company to cut off a promise for an older worker, give that money to a younger worker, and not view it as age discrimination.

That is what this issue is all about. It is fairness. It is equity. I know discussion of pension law can become very convoluted. But this can be boiled down pretty simply. It is about what we think a promise from an employer ought to mean.

There is one thing that has distinguished the American workplace from others around the world. We have valued loyalty. At least we used to. That is one of the reasons pension plans exist--the longer you work somewhere, the more you earn in your pension program. Obviously, the longer you work someplace, the better you do your job, the more you learn about it, the more productive you are. We should value that loyalty.

But here, companies are able to take away the benefits of the longest serving workers. What kind of a signal does that send to the workers? It tells workers they are fools if they are loyal because if you put in 20 or 25 years, the boss can just change the rules of the game, and break their promise. It tells younger workers that it would be crazy to work for a company for a long time, that it's best to hedge your bets and move on as soon as it is convenient. It's crazy to trade current pay for the promise of future benefits. So why even take into account the fact that you're being offered a pension plan? This is a very dangerous road to go down.

This destroys the kind of work ethic we have come to value and that we know built this country. But some of these cash balance conversions counter all of that. Here is an analogy. Imagine I hire someone for 5 years with a promise of a $50,000 bonus at the end of 5 years of service. At the end of 3 years, however, I renege on the $50,000 bonus. But the employee has 3 years invested. Had they known that the deal was going to be off, perhaps they would not have gone to work for me. They could have gone to work someplace else for a total higher compensation package. Now imagine that they hire a new guy to join the team, and they give him part of that $50,000 bonus they promised me. Is that the way we want to treat workers in this country, where the employer has all the cards and employees have none, and employers can make whatever deal they want, but can change the rules at any time?

That is why I am introducing this legislation. It is simple. It says that you have to give older, longer serving employees a choice, at retirement, when their pension plan is converted to a cash balance plan to get the benefits earned in the old plan instead. It also says that employers must start counting the new cash balance benefits where the old defined benefit plan left off, instead of starting the cash balance plan at a lower level than an employee had already earned.

This isn't a radical idea. I was very pleased that in February of 2004, the Administration came out with a cash balance proposal that recognized that these transitions are hard on workers. It not only prohibits wear-away but provides for 5 year transition credits for workers caught in the middle of a conversion. Treasury reaffirmed its commitment to this approach in this year's budget request.

I was excited when Treasury first came to the table with a proposal to do more to protect workers here. I was so encouraged by this that I convened a series of meetings over the course of last summer to get all interested parties to the table--everyone from participant rights advocates to industry groups to consultants. I heard some really great ideas, and some that I didn't agree with. But I think there is still room to find answers to this problem. So I'm putting my plan back on the table today. And I really hope that we can continue a meaningful dialog on this issue.

If we do that, this year, we can enact meaningful participant protections moving forward so that there is another pension option out there to cover the roughly half of Americans with no pension at all. But I also want to make it clear that this Senator will never sit idly by as older workers get the rug pulled out from under them just as they thought they were on solid ground for their retirement. I won't stand idly by and watch their money redistributed in an age-discriminatory way. We can have this dialog and we can find a way to fix what's broken here, but not by blessing some of these blatant abuses.

Mr. President, I rise today to introduce a piece of legislation to fix a huge oversight in pension policy.

In the early 1990s, a large number of U.S. companies began a process of switching their traditional defined benefit pension plans to what's referred to as ``cash balance'' pension plans. A cash balance pension is insured, like a traditional plan, through the PBGC. However, it looks more like a defined contribution plan to participants because the benefit is expressed as some percent of play plus some guaranteed interest rate. This isn't necessarily a bad idea, in and of itself. However, in practice, many of the employees working for these companies were not told what these changes would mean for them. Some companies had their employees work for years without earning any more benefits. Many of those employees didn't figure that out for a very long time. Unfortunately, their lack of understanding in this situation was a key benefit to management. However, once they figured out what was happening, the retirees were furious.

As two consultants who helped put these plans together said at an Actuaries conference in 1998:

``I've been involved in cash balance plans five or six

years down the road and what I have found is that while

employees understand it, it is not until they are actually

ready to retire that they understand how little they are

actually getting.''

``Right, but they're happy while they're employed.''

One of the most abusive practices in cash balance conversions is known as ``wear away. `` The company freezes the value of the benefits employees already earned, which by law cannot be taken away once given. However, the employer opens a cash balance account for that worker at a much lower dollar level. So they end up working for years contributing to this lower cash balance account, not realizing that contribution is meaningless because their old benefits were higher. At the same time, younger workers do get money added to their account every day. This is clearly age discrimination, and bad pension policy.

In 1999, I introduced a bill to make it illegal for corporations to wear away the benefits of older workers during conversions to cash balance plans. I offered my bill as an amendment. Forty-eight Senators, including 3 Republicans, voted to waive the budget point of order so we could consider this amendment. We did not have enough votes then, but I believe the tide is turning.

After that vote, more and more stories came out about how many workers were losing their pensions. In September of 1999, the Secretary of the Treasury put a moratorium on conversions from defined benefit plans to cash balance plans. That moratorium has

been in effect now for over three years. In April of 2000, I offered a Sense-of-the-Senate resolution to stop this practice, and it passed the Senate unanimously.

There are hundreds of age discrimination complaints currently pending before the EEOC based on some of these abusive cash balance conversions. Clearly, something must be done to address this issue that's been floating around now unresolved for over five years.

Before, I said that wear-away is the least fair practice during conversion. And I have to say that now, public sentiment is really coming around to acknowledge that unfairness. However, aside from wear- away, there's another problem in shifting from a traditional pension to cash balance. In a traditional plan, you accrue most of the benefits toward the end of your career, because there's usually some kind of formula that multiplies top pay times years of service. People tend to earn more salary toward the end of their careers, and if that is multiplied times more years served, the pension grows quickly in later years. But in a cash balance plan, younger workers do better because they are given a flat percent of pay plus some guaranteed interest credit. Interest is good for young people, they have many years to accrue and compound it. So if you get caught in mid-life, mid-career in one of these transitions, you get the downside of both plans.

Before I go any further, I want to be clear on one point--cash balance pensions can be a great deal for workers. Some. And they may help fill a needed niche in the pension world to cover the half of the workforce that currently has no pension. But I will continue my long battle to oppose the unilateral decision of a company to cut off a promise for an older worker, give that money to a younger worker, and not view it as age discrimination.

That is what this issue is all about. It is fairness. It is equity. I know discussion of pension law can become very convoluted. But this can be boiled down pretty simply. It is about what we think a promise from an employer ought to mean.

There is one thing that has distinguished the American workplace from others around the world. We have valued loyalty. At least we used to. That is one of the reasons pension plans exist--the longer you work somewhere, the more you earn in your pension program. Obviously, the longer you work someplace, the better you do your job, the more you learn about it, the more productive you are. We should value that loyalty.

But here, companies are able to take away the benefits of the longest serving workers. What kind of a signal does that send to the workers? It tells workers they are fools if they are loyal because if you put in 20 or 25 years, the boss can just change the rules of the game, and break their promise. It tells younger workers that it would be crazy to work for a company for a long time, that it's best to hedge your bets and move on as soon as it is convenient. It's crazy to trade current pay for the promise of future benefits. So why even take into account the fact that you're being offered a pension plan? This is a very dangerous road to go down.

This destroys the kind of work ethic we have come to value and that we know built this country. But some of these cash balance conversions counter all of that. Here is an analogy. Imagine I hire someone for 5 years with a promise of a $50,000 bonus at the end of 5 years of service. At the end of 3 years, however, I renege on the $50,000 bonus. But the employee has 3 years invested. Had they known that the deal was going to be off, perhaps they would not have gone to work for me. They could have gone to work someplace else for a total higher compensation package. Now imagine that they hire a new guy to join the team, and they give him part of that $50,000 bonus they promised me. Is that the way we want to treat workers in this country, where the employer has all the cards and employees have none, and employers can make whatever deal they want, but can change the rules at any time?

That is why I am introducing this legislation. It is simple. It says that you have to give older, longer serving employees a choice, at retirement, when their pension plan is converted to a cash balance plan to get the benefits earned in the old plan instead. It also says that employers must start counting the new cash balance benefits where the old defined benefit plan left off, instead of starting the cash balance plan at a lower level than an employee had already earned.

This isn't a radical idea. I was very pleased that in February of 2004, the Administration came out with a cash balance proposal that recognized that these transitions are hard on workers. It not only prohibits wear-away but provides for 5 year transition credits for workers caught in the middle of a conversion. Treasury reaffirmed its commitment to this approach in this year's budget request.

I was excited when Treasury first came to the table with a proposal to do more to protect workers here. I was so encouraged by this that I convened a series of meetings over the course of last summer to get all interested parties to the table--everyone from participant rights advocates to industry groups to consultants. I heard some really great ideas, and some that I didn't agree with. But I think there is still room to find answers to this problem. So I'm putting my plan back on the table today. And I really hope that we can continue a meaningful dialog on this issue.

If we do that, this year, we can enact meaningful participant protections moving forward so that there is another pension option out there to cover the roughly half of Americans with no pension at all. But I also want to make it clear that this Senator will never sit idly by as older workers get the rug pulled out from under them just as they thought they were on solid ground for their retirement. I won't stand idly by and watch their money redistributed in an age-discriminatory way. We can have this dialog and we can find a way to fix what's broken here, but not by blessing some of these blatant abuses.

Mr. President, I rise to introduce legislation that would help people who ``telework'' or work from home, to receive a tax credit. Teleworkers are people who work on-line from home--whether a few days a week or their entire work schedule--using computers and other information technology tools. Nearly 40 million Americans telework today, and according to experts, 40 percent of the nation's jobs are compatible with telework.

I am introducing the Telework Tax Incentive Act to provide a $500 tax credit for telework. The legislation provides an incentive to encourage more employers to consider telework for their employees. Telework should be a regular part of the 21st century workplace.

The best part of telework is that it improves the quality of life for everyone--both the employee, the employer and the community. Telework reduces traffic congestion and air pollution. It reduces gas consumption and our dependency on foreign oil. Encouraging telework is good for families--giving working parents the flexibility to meet everyday demands. Telework provides people with disabilities greater job opportunities. It can also be a good option for retirees and others who choose to work part-time.

A task force on telework initiated by former Virginia Governor James Gilmore recommended the establishment of a tax credit toward the purchase and installation of electronic and computer equipment that allow an employee to telework. For example, the cost of a computer, fax machine, modem, phone, printer, software, copier, and other expenses necessary to enable telework could count toward a tax credit, provided the person worked at home a minimum number of days per year.

My legislation would provide a $500 tax credit ``for expenses paid or incurred under a teleworking arrangement for furnishings and electronic information equipment which are used to enable an individual to telework.'' An employee must telework a minimum of 75 days per year to qualify for the tax credit. Both the employer and employee are eligible for the tax credit, but the tax credit goes to whomever absorbs the expense for setting up the at-home worksite.

On October 9, 1999, President Clinton signed into law legislation that I introduced in coordination with Representative Frank Wolf from Virginia as part of the annual Department of Transportation appropriations bill for Fiscal Year 2000. S. 1521, the National Telecommuting and Air Quality Act, created a pilot program to study the feasibility of providing incentives for companies to allow their employees to telework in five major metropolitan areas including Philadelphia, Washington, D.C., Los Angeles, Houston and Denver.

President Bush signed legislation on July 14, 2000, that included an additional $2 million to continue telework efforts in the 5 pilot cities, including Philadelphia, to market, implement, and evaluate strategies for awarding telecommuting, emissions reduction, and pollution credits established through the National Telecommuting and Air Quality Act. I am excited that Philadelphia continues to use this opportunity to help to get the word out about the benefits of telecommuting for many employees and employers.

Telecommuting improves air quality by reducing pollutants, provides employees and families flexibility, reduces traffic congestion, and increases productivity and retention rates for businesses while reducing their overhead costs. It's a growing opportunity and option which we should all include in our effort to maintain and improve quality of life issues in Pennsylvania and around the Nation. According to statistics available from 1996, the Greater Philadelphia area ranked number 10 in the country for annual person-hours of delay due to traffic congestion. Because of this reality, all options including telecommuting should be pursued to address this challenge.

The 1999 Telework America National Telework Survey, conducted by Joan H. Pratt Associates, found that today's 19.6 million teleworkers typically work 9 days per month at home with an average of 3 hours per week during normal business hours. Teleworkers seek a blend of job- related and personal benefits to enable them to better handle their work and life responsibilities; however these research findings demonstrate the impact on the bottom line for employers as well. Employers may save more than $10,000 per telework employee simply from reduced absenteeism and increased employee retention. Thus an organization with 100 employees, 20 of whom telework, could potentially realize a savings of $200,000 annually, or more, when productivity gains are added.

When I introduced this legislation in the 107th Congress, it was endorsed by a number of groups including including the International Telework Association and Council (ITAC), Covad Communications, National Town Builders Association, Litton Industries, Orbital Sciences Corporation, Consumer Electronic Association, Capnet, BTG Corporation, Electonic Industries Alliance, Telecommunications Industry Association, American Automobile Association Mid-Atlantic, Dimensions International Inc., Capunet, TManage, Science Applications International Corporation, AT&T, Northern Virginia Technology Council, Computer Associates Incorporated, and Dyn Corp.

Work is something you do, not someplace you go. There is nothing magical about strapping ourselves into a car and driving sometimes up to an hour and a half, arriving at a workplace and sitting before a computer, when we can access the same information from a computer in our homes. Wouldn't it be great if we could replace the evening rush hour commute with time spent with the family, coaching little league or volunteering at a local charity?

I urge my colleagues to consider cosponsoring this legislation that promotes telework and helps encourage additional employee choices for the workplace.

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