Simplification Through Additional Reporting Tax Act of 2006

Mr. President, today, I am introducing the 9/11 Commission Recommendations Implementation Act of 2006. This legislation will provide $41.625 billion over the next 10 years to help ensure that we implement the recommendations of the 9/11 Commission.

Back in July of 2004, the 9/11 Commission--with distinguished bipartisan leadership from former Republican Governor Tom Kean and former Congressman Lee Hamilton--issued its report with recommendations of what the government should do to help better protect the Nation.

Nearly a year and a half later, they issued a so-called report card to tell us how well the government had been doing at implementing their recommendations.

Well, it doesn't look good. That report card was riddled with Cs, Ds, Fs, and incompletes.

Most Americans believe that we've taken the obvious steps to close the gaps in our homeland defense. They believe that at the very least, we have a plan, that we've set priorities, and that we know what the next steps are.

But, let me quote from the Commission's report card from December on what we've done to assess the risks and vulnerabilities of our critical infrastructure--transportation, communications, and industrial assets.

Here's what they say--and I quote--``no risk and vulnerability assessments have actually been made. No national priorities are yet established. No recommendations have been made on the allocation of scarce resources. All key decisions on homeland security are at least a year away.''

We all remember 9/11, when we learned for the first time that local police, fire, and rescue units could not communicate with each other and could not communicate with Federal agencies. We saw how this inability probably resulted in many deaths that could have been prevented. Well, we learned during Hurricane Katrina that things are no better today. No better today.

The one place I think most Americans think we've probably done pretty well--passenger screening--actually got an ``F.'' The 9/11 commission reports stated that, in fact, ``few improvements have been made to the existing passenger screening system since right after 9/11.'' With respect to checked bag and cargo screening for commercial flights, the 9/11 Commission gave a score of ``D'', stating that ``improvements have not been made a priority by Congress or the Bush Administration.''

This is unacceptable. This Administration hasn't even filled in the very obvious gaps in our homeland defense. We haven't done it. We simply haven't done it.

The bill that I am introducing today will ensure that we address the most obvious gaps in our homeland defense. It begins with those areas where the Commission graded us and the President as ``F'' and ``D.'' And, it addresses those areas that were outside the scope of the report but are commonsense things that we should be doing, such as securing the rails and providing funding for local law enforcement.

And it's pretty basic. We have done nothing much to deal with the problems most Americans know relate to homeland security. We are safer but not nearly safe enough. The bipartisan commission that got great grades from everybody in the Nation felt compelled on their own dime, their own money, their own resources, not funded by the government, to continue to issue reports and to hold hearings. And they issued a report on December 5 that is, quite frankly, embarrassing and dangerous.

We can and we have to marshal all our country's resources in this struggle. Do you think that the American people would rather us spend this money on securing our ports, our chemical plants, our railroads, our cities, or give it back as a tax break for the wealthiest Americans? Given the choice, the American people said, let's make our streets safer. I'm confident they think we should make the country safer. This legislation will help take us down that path, and I urge my colleagues to support it.

Mr. President, two of the greatest challenges we face today are how to address the needs of post-conflict countries, and countries that are suffering from large-scale natural disasters. These are critical issues, and ones that we cannot afford to get

wrong--for the sake of the people living in those nations, and for the sake of our own security.

On the post-conflict front, a 2004 commission organized by the Center for Strategic and International Studies and the Association of the U.S. Army found, to no one's surprise, that ``failed states matter--for national security as well as for humanitarian reasons. If left to their own devices, such states can become sanctuaries for terrorist networks, organized crime and drug traffickers, as well as posing grave humanitarian challenges and threats to regional stability.''

The most obvious case in point is the reconstruction of Iraq. I've spent many hours on this floor, for three years, making clear that we have to get it right in Iraq. And in addition to Iraq, unfortunately, we can talk about many other states that are either unstable, or are tenuously recovering from past conflicts including Liberia, Afghanistan, East Timor, Kosovo, Haiti, and the Democratic Republic of Congo.

Earthquakes, floods, drought and landslides often have the most dire impacts in developing countries that are the least equipped to respond. The countries ravaged by the 2004 tsunami are on a path to recovery, but there is still a long way to go: Indonesia lost over 150,000 people, with half a million left homeless. In India, almost 20,000 people lost their lives and 2.79 million people were affected, losing homes, land, and livestock. The tsunami set back the Maldives twenty years in development, eviscerating the country's economic backbone and tourism industry.

Recent years also saw devastating natural disasters in other parts of the world. Earthquakes in Iran affected more than 30,000 people. Catastrophic floods in Bangladesh left thousands dead and hundreds of thousands homeless. Recurring droughts in Afghanistan left over 130,000 people--some 92 percent of the population--in need of food or aid.

We need comprehensive--and creative--strategies to address the need to rebuild in countries on the rebound from conflicts or natural disasters. One such strategy is to tap into the store of human as well as financial resources here in the United States. We should allow, and indeed encourage, immigrants to use their skills, talents, and knowledge to help rebuild their native lands. In fact, the diaspora presents one of the best collective resources that exists: these individuals know the communities. They know the culture. They know the language--more than any contractors and more than any humanitarian workers from the outside, no matter how well trained or how much expertise they may have.

So today, I am introducing legislation that would create a ``Return of Talent'' visa program.

The idea is simple: a Return of Talent program would allow legal immigrants in the United States to return home to help with reconstruction efforts. ``Legal Permanent Residents'' will be able to return temporarily to their countries after a conflict or a significant natural disaster to help rebuild, without their time out of the United States affecting their ability to meet the requirements for U.S. citizenship.

Under current law, a Legal Permanent Resident who wants to apply for U.S. citizenship is required to be physically present in the United States for at least half of the five years immediately preceding the date of filing the naturalization application.

This residency requirement could be particularly difficult to meet for those who may have family and friends in their country of origin who are in desperate need of help. We should not stand in their way of returning, allowing them to bring their talent and expertise home, helping them help others at a time of greatest need.

Press articles have highlighted stories of such individuals-- engineers, bankers, teachers and translators--who are willing to contribute to reconstruction efforts. They simply cannot do so without jeopardizing their immigration status.

This legislation would encourage those skilled and committed individuals to return to their countries of origin to revive the business, industry, agriculture, education, health and other sectors that have been weakened or destroyed after years of conflict or devastating disasters.

The Return of Talent program would include any individual who demonstrates an ability and willingness to make a material contribution to the post-conflict or natural disaster reconstruction in their country of origin.

The program would apply to immigrants from countries where U.S. armed forces have engaged in armed conflict or peacekeeping, or countries where the United Nations Security Council has authorized peacekeeping operations in the past ten years. Immigrants from countries which received funding from the U.S. Office of Foreign Disaster Assistance also would be eligible to participate in the program.

Estimates of individuals who could participate in this program are relatively low. For example, the United States admitted 2,137 Afghani and 3,494 Iraqi immigrants in 2004 who are now Legal Permanent Residents eligible to pursue U.S. citizenship. Immigrants from Indonesia numbered 2,418 and Bangladesh, 8,061 in the same year. Yet, while the program would have a small impact on the U.S. naturalization process, the contributions of even a few hundred individuals could have a tremendous positive effect on reconstruction work.

In simple terms, a Return of Talent program makes sense. Everybody wins: The United States is able to support badly needed rebuilding efforts without increasing foreign aid; immigrants are able to use their skills and resources to help communities without jeopardizing their immigration status; and the people recovering from conflict and disaster receive much-needed assistance.

A Return of Talent program is an important piece of our overall strategy to stabilize and rebuild countries torn by conflict and devastated by natural disaster. I urge my colleagues to support this legislation.

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

Mr. President, today I am proud to join with my colleagues, Senators Bingaman, Clinton and Nelson, to introduce the Home and Community Based Services Copayment Equity Act of 2006. This important piece of legislation addresses a significant oversight in the Medicare Part D prescription drug benefit. While nearly 22 million seniors now have access to affordable prescription drug coverage under the program, many of the most vulnerable Medicare beneficiaries are being charged unnecessary copayments simply based upon how they choose to receive their long-term care services.

Under current law, dual eligible Medicare beneficiaries, those who qualify for both Medicaid and Medicare coverage, receive a subsidy from the government to pay the benefit's required $250 deductible. These individuals also qualify for reduced copayments for both generic and brand named drugs in the amount of one and three dollars respectively. If a dual-eligible beneficiary receives long-term care services in an institutional setting, such as a nursing home, he or she is exempt from paying the required copayment. Congress decided to provide this assistance because dual-eligible beneficiaries residing in nursing homes live off of very limited incomes. For instance, in Oregon the personal needs allowance beneficiaries receive each month for incidentals, including medications, is only $30. As many institutionalized beneficiaries are on multiple medications, they would not be able to meet their share of drug costs.

This is the very reason Congress provided institutionalized dual- eligible beneficiaries with an exemption from all copayments under Medicare Part D. However, many dual eligible beneficiaries choose to receive long-term care services in home or community-based settings, such as assisted living or resident care program facilities. Almost all states have chosen to establish Home and Community Based Services Medicaid demonstration projects that have expanded access to community based alternatives to an even greater number of low-income elderly Americans. The State of Oregon operates one of the Nation's most successful HCS waivers, serving approximately 23,500 dual eligible beneficiaries this year. My State has a thriving community based care industry that has provided many dual eligible Oregonians the freedom to choose the care setting that best meets their own physical and social needs.

While dual eligible beneficiaries are exempted from prescription drug copayments under Medicare Part D, those choosing community based alternatives are required to pay them. This is despite the fact that beneficiaries choosing community based care options typically live off of the same limited incomes as those residing in nursing homes. Despite the fact that some States provide HCS beneficiaries a larger personal stipend each month, they may have greater financial demands. At the end of the day, they are in no better position to pay the costs of prescription drugs than those beneficiaries living in nursing homes.

I should also note that their less restrictive living environments may require them to take additional medications to support their daily routines. It is not uncommon for dual eligible beneficiaries in community-based care settings to be on 8 to 10 medications at a given time. At that level, even minimal copayments create a significant financial burden to these individuals.

The current dual-eligible copayment exemption policy is not only creating inequity in Medicare Part D, it is potentially restricting access to life-saving medications. This is certainly not what Congress intended when it created the new prescription drug benefit, especially for this incredibly vulnerable population. If Congress does not act quickly to extend the exemption to dual eligible beneficiaries in community based care, individuals may begin to gravitate toward institutional options simply because they can have their drugs costs paid in those settings. I believe we need to do everything possible to support choice in long-term care, and by applying the current institutional copayment exemption more uniformly, Congress will ensure the Medicare drug benefit does not adversely affect beneficiaries choices.

I ask my colleagues to improve the fairness of the Medicare prescription drug benefit for all dual eligible beneficiaries by supporting the Home and Community Based Copayment Equity Act. I hope you will join me in calling for its quick passage in the Senate.

Mr. President, I rise to speak in favor of a bill I am proud to introduce today with Senators Bayh, Kerry, and Carper to help close the tax gap by improving the reporting of capital gains income. This bill requires brokerage firms and mutual fund companies to track and report the adjusted cost basis of their clients' stock, bond, and mutual fund investments.

This bill is a simple, commonsense solution to a serious problem. Many taxpayers have a hard enough time filing their taxes. One of the most complex parts of an individual's tax return is the schedule for capital gains income. And what makes capital gains particularly difficult is the challenge of figuring out the adjusted basis of a security that has been sold.

Many taxpayers do not have the proper records or they don't know how to calculate adjusted basis for a stock that has split or been exchanged as part of a company's merger or acquisition. And right now, the IRS does not have the ability to monitor the accuracy of taxpayer calculations. As a result, there is a risk of error or fraud. In some cases, taxpayers may end up paying too much in taxes. More often, they report too little income and pay too little in taxes.

In 2001, the IRS estimated that underreporting cost the Treasury $11 billion annually. Today the loss is even greater.

Because the IRS fails to collect these funds, the taxes that the rest of us have to pay are greater than they should be. Most people pay their taxes honestly and follow the law to the best of their ability. But a small number of tax frauds--who often owe great amounts of taxes--cheat the system. And it's hard now for the IRS to stop them.

This bill makes it easier to stop them and it helps reduce the amount of Federal tax dollars that the IRS fails to collect each year. Brokerage firms and mutual fund companies will be required to keep track of a taxpayer's cost basis and to report that information to the IRS. This will make it easier for honest taxpayers to calculate their taxable capital gain, and harder for dishonest ones to lie about it. Based on information from the Taxpayer Advocate, reporting to the IRS can improve compliance of capital gains reporting from an estimated 50 percent today to 90 percent.

Fortunately, this new reporting requirement will not pose an undue burden to the financial firms affected. First, the firms will have plenty of time to put the necessary systems in place since the reporting requirement will not take effect until 2009, and then will only apply to securities acquired starting in 2008. Second, technology has made tracking by financial firms simple and efficient. More than 80 percent of all retail accounts already subscribe to a national reporting service for transferring basis information at a nominal cost per account. Finally, in cases where it is impossible to track basis, the Treasury Secretary may develop regulations to require alternative information.

It is estimated that $345 billion of Federal taxes goes uncollected each year. This bill doesn't solve that full problem, but it is a step in the right direction. It reduces the Federal deficit without raising taxes or cutting spending. It simplifies the tax filing process and reduces the chance of error or fraud. It applies what we know about the benefits of automatic reporting to the IRS--which is required now for wage income--to capital gains income as well.

This bill makes sense. It's good policy. I urge my colleagues to join me in supporting it and to helping to improve our tax code.

Mr. President, I rise to speak in favor of a bill I am proud to introduce today with Senators Bayh, Kerry, and Carper to help close the tax gap by improving the reporting of capital gains income. This bill requires brokerage firms and mutual fund companies to track and report the adjusted cost basis of their clients' stock, bond, and mutual fund investments.

This bill is a simple, commonsense solution to a serious problem. Many taxpayers have a hard enough time filing their taxes. One of the most complex parts of an individual's tax return is the schedule for capital gains income. And what makes capital gains particularly difficult is the challenge of figuring out the adjusted basis of a security that has been sold.

Many taxpayers do not have the proper records or they don't know how to calculate adjusted basis for a stock that has split or been exchanged as part of a company's merger or acquisition. And right now, the IRS does not have the ability to monitor the accuracy of taxpayer calculations. As a result, there is a risk of error or fraud. In some cases, taxpayers may end up paying too much in taxes. More often, they report too little income and pay too little in taxes.

In 2001, the IRS estimated that underreporting cost the Treasury $11 billion annually. Today the loss is even greater.

Because the IRS fails to collect these funds, the taxes that the rest of us have to pay are greater than they should be. Most people pay their taxes honestly and follow the law to the best of their ability. But a small number of tax frauds--who often owe great amounts of taxes--cheat the system. And it's hard now for the IRS to stop them.

This bill makes it easier to stop them and it helps reduce the amount of Federal tax dollars that the IRS fails to collect each year. Brokerage firms and mutual fund companies will be required to keep track of a taxpayer's cost basis and to report that information to the IRS. This will make it easier for honest taxpayers to calculate their taxable capital gain, and harder for dishonest ones to lie about it. Based on information from the Taxpayer Advocate, reporting to the IRS can improve compliance of capital gains reporting from an estimated 50 percent today to 90 percent.

Fortunately, this new reporting requirement will not pose an undue burden to the financial firms affected. First, the firms will have plenty of time to put the necessary systems in place since the reporting requirement will not take effect until 2009, and then will only apply to securities acquired starting in 2008. Second, technology has made tracking by financial firms simple and efficient. More than 80 percent of all retail accounts already subscribe to a national reporting service for transferring basis information at a nominal cost per account. Finally, in cases where it is impossible to track basis, the Treasury Secretary may develop regulations to require alternative information.

It is estimated that $345 billion of Federal taxes goes uncollected each year. This bill doesn't solve that full problem, but it is a step in the right direction. It reduces the Federal deficit without raising taxes or cutting spending. It simplifies the tax filing process and reduces the chance of error or fraud. It applies what we know about the benefits of automatic reporting to the IRS--which is required now for wage income--to capital gains income as well.

This bill makes sense. It's good policy. I urge my colleagues to join me in supporting it and to helping to improve our tax code.

Mr. President, today I rise to introduce bipartisan legislation with my colleagues Senators Smith, Nelson, and Bingaman to address yet another serious flaw in the Medicare prescription drug benefit that has come to light.

On January 1, the new Medicare prescription drug benefit went into effect. Overnight, millions of seniors and disabled Americans found themselves thrown into a confusing and complex transition.

Some of our poorest and most vulnerable beneficiaries, those in assisted living facilities, have found themselves suddenly forced to produce co-payments to get the medications they need.

These are beneficiaries with serious mental illnesses who have been stabilized on medications, and people with developmental and physical disabilities who have little or no incomes and no way to afford the medicines that they depend on.

The bill we are introducing will fix this problem by waiving co- payments for this group of vulnerable beneficiaries in the same manner that these co-payments are already waived for Medicare beneficiaries in nursing homes.

This is just one of so many problems we have seen plaguing this program. I am working on all fronts to help Medicare beneficiaries weather this transition. Before this program went into effect, it was clear that those dually eligible for Medicare and Medicaid, our poorest and most vulnerable seniors and disabled, would have a particular challenge navigating this transition. I was very concerned that many of these Medicare recipients would walk up to their pharmacy counters on January 1 and be unable to get their prescriptions filled.

In anticipation of these problems, I introduced legislation in December to keep these Medicare recipients from falling through the cracks by stepping up outreach and education to pharmacists and providing reimbursement to pharmacists who are charged a transaction fee to access beneficiary information through Medicare. I also co- sponsored legislation to give Medicare beneficiaries more time to enroll in the new program.

And I issued a resource guide, now available in both English and Spanish, to help New Yorkers navigate this new program. To date more than 75,000 copies of the guide have been distributed.

Since the new program went into effect, I have repeatedly urged the Bush Administration to address the problems plaguing this program. And in January, I introduced comprehensive legislation along with several of my Senate colleagues, that includes my bill to help pharmacists help their customers, and makes the other fixes I have been calling for: provisions to improve outreach and education, fix problems with drug plans transition programs, protect the benefits of seniors who also have coverage from a retiree drug plan, and make sure that states and low income beneficiaries are reimbursed for excessive costs they have been forced to shoulder by the inept implementation of the new benefit.

We owe it to our seniors and disabled Americans to get this right. And I will keep fighting to ensure that we do.