To designate the facility of the United States Postal Service located at 301 Boardwalk Drive in Fort Collins, Colorado, as the "Dr. Karl E. Carson Post Office Building".

Mr. President, I rise today to introduce the Credit Card Fair Fee Act of 2008. This legislation will provide fairness and transparency in the setting of credit card interchange fees. This bill is companion legislation to a bipartisan bill introduced in the House of Representatives by Chairman John Conyers of the House Judiciary Committee and Representative Chris Cannon. The Conyers-Cannon bill currently has an additional 19 Democratic and 16 Republican cosponsors.

This legislation is supported by the Merchants Payments Coalition, a coalition of retailers, supermarkets, convenience stores, drug stores, fuel stations, on-line merchants and other businesses. The coalition's member associations collectively represent about 2.7 million stores with approximately 50 million employees.

Interchange fees may not be well known to most Americans, but they should be. Last year, U.S. retailers, and by extension their customers, paid approximately $42 billion in interchange fees to the banks that issue credit cards. The billions that are paid in interchange fees each year significantly cut into the profit margins of retailers and pinch the pocketbooks of consumers. And neither retailers nor consumers have a say in how these interchange fees are set within the Visa and MasterCard systems, which together account for over 70 percent of the credit and debit card market. The current lack of meaningful competition, negotiation and transparency in the setting of interchange fees represents a market failure, one that affects every American retailer and every American consumer.

My legislation takes a measured approach to address this market failure. My bill would identify credit and debit card payment systems that have significant market power, and would permit the retailers who use those systems to collectively negotiate with the providers of the systems over the fees for system access and use. If the retailers and providers are unable to agree voluntarily on a consensus set of fees, the bill would direct an impartial panel of judges to consider the two parties' fee proposals, and to select the proposal that most closely reflects what a hypothetical perfectly competitive market would produce. As I will discuss further below, this approach will protect retailers and consumers by preventing credit card companies from using their market power to charge unreasonable fees through an unfair process.

So what are interchange fees, and why do they pose a problem? Whenever a consumer uses a credit or debit card to make a purchase from a retailer, the banks and credit card companies involved in the transaction charge a number of fees that are passed on to the retailer and ultimately to the consumer. The interchange fee is one such fee. It is a fee charged by the card-issuing bank to the retailer's bank.

Here is an example of how an interchange fee is charged. When a consumer buys $100 in goods from a retailer using a Visa or MasterCard, the retailer first submits the transaction information to the retailer's bank (the ``acquiring bank''). The acquiring bank submits this information, via the Visa or MasterCard network, to the bank that issued the card to the consumer, the issuing bank. The issuing bank either authorizes or denies the transaction. If the transaction is authorized, the issuing bank sends to the acquiring bank, via the Visa or MasterCard network, the purchase amount minus an interchange fee that is retained by the issuing bank.

As a result of the interchange fee and other processing fees imposed upon the retailer by the acquiring bank, collectively, these fees are known as the ``merchant discount fee,'' the retailer typically only receives approximately $97.50 out of the $100 sale. In order to cover this cost and continue to make a profit, retailers typically raise the retail price of their goods, meaning that consumers must pay more regardless of whether they pay with cash or plastic.

Visa and MasterCard set the interchange fee rates for all the banks and all the retailers that participate in the Visa and MasterCard systems. Those interchange rates are frequently charged as a percentage of the sale amount plus a flat fee; for example, an interchange fee might equal 1.75 percent + 20 cents per transaction. The interchange fee rate varies for certain types of Visa and MasterCard cards and transaction categories, and is typically higher for cards that involve rewards programs for cardholders.

What is the rationale for assessing interchange fees? According to Visa, MasterCard, and the banks that issue them, these fees are used to pay for important functions within the credit and debit card systems. For example, interchange fees can be used to cover the costs of processing and authorizing credit card transactions, including the costs of ensuring data security and safeguarding against fraud. Interchange fees can also help protect an issuing bank from the risk that a consumer may not pay his or her credit card bill, which would leave the issuing bank on the hook for the amount that it gave to the acquiring bank at the time of a credit card transaction.

In addition to covering these costs and risks, interchange fees have been used to generate income for issuing banks. This income can be retained by the issuing banks as profit, or can be devoted to other uses such as consumer marketing campaigns or rewards programs for certain cardholders.

In addition to the benefits that interchange fees provide for issuing banks, Visa, MasterCard and their participating banks argue that interchange fees have also provided benefits to retailers and consumers by helping to make credit and debit card transactions more efficient and more prevalent. Visa, MasterCard and the banks claim that the growing use of credit and debit cards saves retailers from certain expenses involved with transacting business with cash or

checks. They also claim that their cards bring benefits to consumers, including extra convenience, the availability of short-term credit, and rewards programs that are offered to some cardholders.

It is clear that interchange fees do play an important part in the credit and debit card systems, and that overall these systems have created efficiencies and benefits for banks, merchants and consumers. However, it is also clear that those who must ultimately pay interchange fees--retailers and their consumers--have no say in negotiating how much the interchange fees should be. As a result, interchange fees are being set at rates that would not be agreed upon in a competitive market, and that may favor banks to the detriment of merchants and consumers.

Why are retailers unable to negotiate changes in Visa's and MasterCard's interchange fee rates? There are several reasons. First, because of Visa's and MasterCard's market power, the overwhelming majority of American retailers have no choice but to accept Visa and MasterCard as a method of payment. Credit and debit cards are currently used for over 40 percent of all transactions in the U.S., and that percentage is increasing, in part due to extensive marketing by the card companies and the banks. Visa and MasterCard control over 70 percent of the market for credit and debit cards. Most retailers simply cannot survive unless they agree to accept those cards.

Second, within an electronic payment system the only party with whom retailers are able to negotiate effectively is the retailer's acquiring bank, and interchange fees are not covered in those negotiations. In their efforts to obtain retailers' business, including the business of processing the retailers' credit card transactions, acquiring banks will negotiate and compete over many of the component fees that make up the merchant discount fee. However, the interchange fee is typically by far the largest component of the merchant discount fee, and acquiring banks do not negotiate with retailers on interchange rates nor do they compete to offer retailers lower interchange rates. Instead, interchange rates are set by Visa and MasterCard, who claim that their rates are set without the involvement of the banks. Accordingly, the acquiring banks tell their retailer customers that the interchange rate component cannot be negotiated or reduced below the level set by Visa and MasterCard.

The interchange fee thus serves as a de facto price floor for the overall merchant discount fee--a floor that is fixed in a nontransparent, nonnegotiable fashion by card companies with significant market power. Although I have asked the credit card companies on several occasions for information that would help me understand the cost components that contribute to their interchange rates, it is still unclear how much profit margin is built into that floor. The margin may be significant, and as long as issuers and acquirers are happy with it, there is no incentive for card companies to help merchants and consumers by reducing it. Additionally, it should be noted that many if not most acquiring banks also serve as issuing banks, and therefore have almost no incentive to compete to lower the interchange rates that they themselves receive. Because the acquirers and issuers are often the same banks, no one negotiates with issuers about interchange fees on the retailers' behalf, and the retailers are left to negotiate for themselves.

Third, while some retailers may try to negotiate directly with Visa or MasterCard to lower the interchange fee component of their merchant discount fees, most retailers have no leverage in these negotiations since at the end of the day they will likely have to agree to accept Visa and MasterCard in order to stay in business.

As a result of this vast disparity in negotiating power, Visa and MasterCard can essentially impose interchange rates upon retailers and those retailers have no choice but to accept them. Furthermore, Visa and MasterCard also frequently impose take-it-or-leave-it contractual terms and conditions on retailers, such as acceptance rules that require retailers to honor all cards issued by that credit card company, even if the card is a rewards card with a higher interchange rate.

Because there is no competition and no real retailer negotiation involved in the setting of interchange fees, it is not surprising that interchange fees are being charged at levels that would not be agreed upon in a fair and competitive market. This has been demonstrated in a number of ways.

For example, as economies of scale and advances in technology have brought down the cost of credit card transaction processing in recent years, normal market pressures would suggest that interchange rates would have similarly decreased. But as noted in a March 29, 2008 Wall Street Journal editorial, ``The Visa interchange fee has increased over the past decade to 1.76 percent from an average of 1.5 percent. Economies of scale should be driving fees down, as in most other service-fee industries.'' In March 2006, the American Banker reported that ``according to the credit card industry newsletter The Nilson Report, interchange rates for Visa and MasterCard International have risen steadily every year since 1997.''

Also, interchange fees continue to be charged as a percentage of the sale price, so even though the cost of processing a $1 credit card transaction is comparable to processing a $1,000 transaction, the interchange fee paid on that $1,000 sale is much higher and much more lucrative for the issuing bank.

Additionally, Americans are paying higher interchange fees than are consumers in other countries who use the same Visa and MasterCard cards. According to a report by the Federal Reserve Bank in Minneapolis, U.S. interchange fees average around 1.75 percent, while in other industrialized countries such as Britain interchange fees typically average around 0.7 percent.

In 2001, the total amount of interchange fees collected in the U.S. was $16.6 billion. By 2007, that amount grew to approximately $42 billion, an increase of over 150 percent since 2001. What are banks doing with the tens of billions of dollars they are collecting in interchange fees each year? There is a serious lack of transparency on this issue, but one study indicates that only around 13 percent of collected interchange fees are devoted to covering the cost of processing credit card transactions. According to this study, the majority of the collected fees went toward profits for the issuing banks, rewards programs that benefit mostly affluent cardholders, and marketing campaigns.

Visa and MasterCard and the banks that use them argue that their interchange fee rates are set at levels that best balance benefits and costs to card issuers and to merchants. If the card companies and the banks truly believe that interchange fee rates are already set at a level that is fair to merchants, it seems they should have no objection to formalizing a process for setting interchange rates that is fair and transparent and that gives merchants a legitimate voice in the process.

That is what the Credit Card Fair Fee Act would do. This legislation would apply to widely-used credit and debit card systems. Recognizing that these electronic payment systems have become nearly as important to our consumer economy as cash and that most retailers cannot stay in business without accepting them, the bill would ensure that retailers have access to these electronic payment systems at fair rates and terms.

Under the bill, if any electronic payment system has significant market power, i.e., 20 percent or more of the credit and debit card market, retailers would receive limited antitrust immunity to engage in collective negotiations with the providers of that electronic payment system over the fees and terms for access to the system.

The bill would establish a mandatory period for negotiations between the retailers and providers over fees and terms. If the negotiations between the retailers and providers do not result in an agreement, the matter would be brought before a panel of expert Electronic Payment System Judges, who would be appointed by the Department of Justice Antitrust Division and the Federal Trade Commission.

These Judges would conduct a period of discovery during which information about fees, terms, and market conditions for electronic payment systems

would be disclosed. At the end of the discovery period, the Judges would order a mandatory 21-day settlement conference to facilitate a settlement between the retailers and electronic payment system providers. If the settlement conference failed to result in an agreement, the Judges would conduct a hearing where each side would present their final offer of fees and terms. The Judges would then select the offer of fees and terms that most closely represented the fees and terms that would be negotiated in a hypothetical perfectly competitive market where neither party had market power.

After choosing between the two offers put forth by the parties, the Judges would enter an order providing that these fees and terms would govern access to the electronic payment system by the merchants for a period of 3 years, unless the parties supersede this agreement with a voluntarily negotiated agreement. Decisions by the Judges would be appealable to the D.C. Circuit Court of Appeals.

The Credit Card Fair Fee Act is modeled after the Copyright Royalty and Distribution Reform Act of 2004, which created a similar system for the use of copyrighted music works.

Credit card companies and banks may claim that this legislation involves government price setting, but this is not the case. This legislation does not permit the government to establish on its own accord what the fees and terms for retailer usage of credit card systems ought to be. Rather, it sets up a process whereby retailers would be able to make their case as to what fees and terms are fair, and if the retailers and credit card providers fail to agree voluntarily on those fees and terms, independent judges would evaluate the parties' offers and select the offer that most closely resembles what the result would be in a fair and competitive market. In contrast, currently Visa and MasterCard can use their overwhelming market power to establish non-negotiable interchange fees and terms, and retailers are forced to abide by these fees and terms or else be denied access to payment systems that account for a huge percentage of all U.S. transactions. This type of unaccountable fee-setting runs far more risk of harm for retailers and consumers.

Under my legislation, if the credit card companies and the banks are able to persuade the Judges that current interchange rates are justifiable, then the rates would remain as they are today. If, on the other hand, the retailers are persuasive in arguing that current interchange rates cannot be justified by competitive market dynamics, then the Judges would likely rule that alternative interchange rates would better represent the result of a perfectly competitive market. In either case, at a minimum the interests of retailers and consumers would be much better represented in this fundamentally important market.

My legislation represents a measured approach to addressing the current market failure with interchange fee-setting. Other countries have addressed the problem of unfair interchange fees through far more drastic solutions. For example, Australia has imposed a system of direct regulation of interchange fees through its central bank, and Mexico's central bank has negotiated rate reductions with the card companies. My legislation represents a middle ground between the current flawed system and these aggressive foreign regulatory frameworks.

In short, the Credit Card Fair Fee Act would address the market power imbalance between retailers and credit card companies in setting interchange fee rates. It would create a forum where these fees can be fairly negotiated by parties with equal bargaining power. It would ensure that interchange fees and terms are fair to both banks and retailers. And if retailers are able to negotiate interchange rates that reduce the transaction cost of doing business with plastic, it would be beneficial to consumers as well.

How do we know that retailers will not just pocket any savings they get through any reduction in interchange fees that they are able to negotiate? We know because unlike the credit card interchange rate- setting process, the retail industry is highly competitive, and that competition is largely based on price.

Also, sometimes we hear the banks and card companies argue that if interchange fees are reduced, they will have to raise fees and penalties on cardholders to make up for the revenue shortfall. If these companies stand by this argument, I would expect them to stand by its converse and reduce their cardholder fees and penalties whenever their interchange fee collections increase. However, interchange fee collections have increased 150 percent since 2001, and we have seen no corresponding decrease in fees and penalties imposed upon all cardholders. Unless you are one of the small percentage of cardholders with a current balance, no annual fees, and a lavish rewards program, your issuing bank is probably taking two bites at your wallet--one with interchange fees and one with the fees on your statement.

The Credit Card Fair Fee Act will protect consumers and retailers by preventing credit card companies from using their market power to charge unreasonable fees through an unfair process. This is important legislation, and I urge my colleagues to support its passage.

I thank my friend from California for yielding.

As he mentioned, it is interesting that we are setting aside land for wilderness area to be managed by the Federal Government. It came out of the Committee on Natural Resources, but we are not using all our natural resources right now. We are not using some of the oil reserves that we have in ANWR. We are not using the oil that is on the Outer Continental Shelf. We are not using the shale coal that we have that we can convert to oil. We are not using the clean-burning coal to the best of our ability. We are not drilling for natural gas.

So we have natural resources in all parts of our country that we are not taking advantage of, and the reason that we are not taking advantage of it is because the new majority in the 110th Congress is being controlled or partly controlled by the radical environmentalists that don't want us to drive a Suburban or an extended cab pickup. They don't really care if gas goes to $10 a gallon.

So I would like for this House to concentrate on the majority of Americans who are tired of paying $4 a gallon for gas. They understood that when the new majority was elected, and you go back to April of 2006 and then minority leader, now Speaker Nancy Pelosi, made the statement, that the Democrats had a commonsense plan for bringing down the skyrocketing price of gas.

Now, I think at the time, Mr. Speaker, gas was about $2.20 a gallon. I never thought we would lament or say, man, can you remember back when gas was $2 a gallon? But that is what it was when the Democrat majority said they had this new commonsense approach for bringing down the skyrocketing gas price.

Since that time, gas has almost doubled. It has almost doubled. So where is that commonsense plan? Where is it that we are using some of our natural resources to increase the supply of production that we have in this country, rather than being so dependent on foreign oil?

Now, the problem is that the majority passed in January of 2007 an energy bill, and that energy bill, which many on our side of the aisle called the ``no-energy bill,'' went into effect. So we thought that that was the secret plan. Mr. Speaker, we thought that was this commonsense approach.

Once we looked at the bill, we saw that gasoline was mentioned about five or six times, that crude oil was mentioned about maybe 12 times, and that nothing was mentioned about domestic drilling, nothing was mentioned about increasing the production or using our natural resources to make us less dependent on foreign oil. But what we saw were words like ``swimming pool'' was used 47 times, ``lamp'' or ``light bulb'' was used 350 times, ``renewable energy'' was used a number of times, ``greenhouse gases'' was used a number of times, but nothing was really in that ``no-energy bill'' that helps us today.

I think we see evidence of that today with gas being over $4 a gallon. There was nothing in there to help us bring down the price of gas, number one, and that was where the commonsense approach was to be, was to bring down the skyrocketing price of gasoline. Not only did we not bring it down, it has doubled.

So where is this commonsense approach? I think the American people are ready to see it. I know my constituents are. When I go home, just like we have been home during the Memorial Day break, I had people ask me, what are we doing about increasing our domestic production? What are we doing about having the ability to become less dependent on foreign oil?

I have to explain to them the ``no-energy bill'' that was passed by this Congress and the things that it mentioned and the things that were there, and really and truly, Mr. Speaker, they think I am lying to them or kidding them, that that is the commonsense plan that the majority had, because it wasn't a plan at all. It was some type of smoke and mirrors that was sold to the American people. Now that gas is more than twice what it was, what are we to tell them? Because I have not seen anything come out of the Democratic side.

Now we have come up with an energy proposal that makes sense. It allows us to use some of our natural resources. What the other part that my constituents don't believe is that we as a government will not allow drilling off the coast of Florida, and yet China is fixing to start drilling 45 miles off our coast.

They can use the slant drilling technology and probably get deeper into our oil reserves. Now, what are we to tell people? What am I to tell my constituents that this Congress is doing about that? They are doing nothing about it, not one single thing.

We are naming post offices, we are coming up with wilderness areas and many more days of honoring somebody or recognizing a week or recognizing a month, but we are not doing anything on this House floor, nor have we done anything on this House floor, to really bring down the price of gas, crude oil or come up with a commonsense plan for that American worker out there that's going to the pump, costing him $100 to fill up with gas.

Now, I don't know the answer to it, but I would suspect that if we pass some type of legislation that said we were going to start drilling, whether it be in ANWR, Outer Continental Shelf, wherever it is, that the oil speculators, that the bottom would fall out of that because people would say, you know what? They are finally doing something to become less dependent on somebody else's oil production.

So we don't have to hold them hostage anymore, and those prices would come down, just at the fact that we passed the legislation--not that we put the first drill bit in the ground--but just that these oil speculators and the American people saw that their elected officials were wanting to do something to take a positive step that we can meet our own energy needs.

Mr. Speaker, I want to ask, what's wrong with that? I don't think there is anything wrong with that. I think that the people that elect us deserve to know what our plan is. The Republican side has come out with a plan. They say, look, we are going to take advantage of our natural resources. We are going to take advantage of the things that we were God given in this land. We are going to take advantage of our oil reserves, of our natural gas, of our abundance of coal.

We are going to take advantage of those things, and we are going to use the technology that we have been so good about coming up with. We are going to take and convert this shale to oil, which Hitler did in the late 1920s--in the late 1920s--and we don't think that we can do that today?

There is a problem, and we need the courage, the political courage and the political guts to stand up and say we are going to--or at least I hope the majority party will go--we are going to go against those people that we owe so much to for being in the majority, and say we are going to do what's good for the American people. We are going to use our own natural resources. We are going to do what the people that elected us expect us to do, and that's what's the best for them, not the best for special interest groups.

I just hope that during this next conversation that we have on these upcoming bills that we will be on this floor discussing this issue, because we have not really had a debate on it. I wish that the majority party would bring a bill to this floor and have an open rule so we could vote on some of these things that are so important.

The truth of it is that our constituency doesn't really know how we believe on some of these issues, because the majority has never given us the ability to vote on it. Let's vote on drilling on ANWR, just a straight up or down vote, not anything else tied to it. Let's drill on our natural gas. Let's vote on our natural gas drilling, not anything else tied, just an up or down. Let's drill on the converting of coal- to-liquid oil. Let's vote on that, just an up or down, rather than tie so many things that's so confusing to the American people.

That's what I hope we will do.

Thank you for yielding.

To my other friend from California over there, I know that the gentleman is the chairman of the Subcommittee on Energy and Mineral Resources, and I think that subcommittee has jurisdiction over the drilling in ANWR and the Outer Continental Shelf. Right now only 3 percent of the Outer Continental Shelf is leased for oil and natural gas, and only 6 percent of the Bureau of Land Management public lands are leased.

So I think that it would be a good opportunity for the gentleman, for just my suggestion, that we look at that. I know that it has been looked at many times before.

The gentleman mentioned about the Republicans being in control for 12 years, I was only here for 2 of those years, so I was quite disappointed too that we never passed a comprehensive energy plan. You know, I am very concerned about that, and I hate that.

What I am proud of is that right now that we have come up with an energy plan that would help with our dependence on foreign oil, and maybe it took 12 years for us to wake up. I certainly hope that the majority party that's in

control now, that it doesn't take them 12 years to wake up to understand that we need an energy policy.

Now, if it's going to take them 12 years to wake up, we will be paying $12 a gallon like they are paying in the Netherlands or $9 a gallon like they are paying in Germany. I know that would make some of their base awfully happy if we were paying those gas prices, but your average American family, the man and the woman out there trying to make a living and trying to provide for their family, does not like paying $4 a gallon for gasoline when we are not doing anything, anything to reduce our dependence on that foreign oil.

I agree with Mr. Nunes from California in the fact that we need to bring some bills to the floor. We are doing 20 suspension bills on this floor today. The U.S. Congress is addressing 20 bills on this floor today, that most of them will be passed by a voice vote, and most Americans won't even know what we did.

Some of these pieces of legislation should be going through a regular rule, a regular order of process, where we can come in and make some amendments on some of these. There may be in these wilderness areas, there may be some spots where we have the potential for natural gas or oil, where we have potential for solar, where we have potential for wind power. Those are being restricted on just about every one of these pieces of legislation that we are doing today.

So let's have an open, honest--that's another promise that the majority made to the American people, that this was going to be the most open, honest Congress in history. I hate to say this, and I was only here for 2 years when we were in control, but that's not true. That's another falsehood and whether they did it purposefully or not, that this is not the most open, honest Congress that this country has ever seen, and it does not or has not or not yet come up with a commonsense approach to bring down the skyrocketing cost of gasoline when it was $2.20 a gallon, and now it's over $4 a gallon.

Mr. President, I ask unanimous consent that the Committee on Banking, Housing, and Urban Affairs be authorized to meet during the session of the Senate on August 1, 2007, at 9:30 a.m., to mark up S. 1677, the Currency Reform and Financial Markets Access Act of 2007; S. 1518, the Community Partnership to End Homelessness Act of 2007; an original bill entitled the FHA Modernization Act of 2007; an original bill entitled the Housing Assistance Authorization Act of 2007; an original bill entitled the Private Student Loan Transparency and Improvement Act of 2007; and an original bill entitled the Commission on National Catastrophe Risk Management and Insurance Act of 2007.

Mr. President, I ask unanimous consent that the Committee on Commerce, Science, and Transportation be authorized to hold a hearing during the session of the Senate on Wednesday, August 1, 2007, at 2:30 p.m., in room 253 of the Russell Senate Office Building.

The U.S. Department of Commerce and its component bureaus are responsible for the stewardship, protection, and scientific understanding of our ocean environment and its resources, effective use and growth of the Nation's technological resources, and promoting U.S. trade and tourism. The oversight hearing will examine the Department's effectiveness in implementing these goals.

Mr. President, I ask unanimous consent that the Committee on Energy and Natural Resources be authorized to hold a hearing during the session of the Senate on Wednesday, August 1, 2007, at 9:30 a.m. in room SD-366 of the Dirksen Senate Office Building.

The purpose of this hearing is to receive testimony on recent advances in clean coal technology, including the prospects for deploying these technologies at a commercial scale in the near future.

Mr. President, I ask unanimous consent that the Committee on Foreign Relations be authorized to meet during the session of the Senate on Wednesday, August 1, 2007, at 9:30 a.m. to hold a hearing on Africa.

Mr. President, I ask unanimous consent that the Committee on Health, Education, Labor, and Pensions be authorized to meet in executive session during the session of the Senate on Wednesday, August 1, 2007 at 10 a.m. in the LBJ Room, S-211, of the Capitol building. We will be considering the following:

1. S. 625, Family Smoking Prevention and Tobacco Control Act

2. S. 1183, Christopher and Dana Reeve Paralysis Act

3. S. 579, Breast Cancer and Environmental Research Act of 2007

4. S. 898, Alzheimer's Breakthrough Act of 2007

5. S. 1858, Newborn Screening Saves Lives Act of 2007

6. The Following Nominations: Diane Auer Jones, of Maryland, to be Assistant Secretary for Postsecondary Education, Department of Education; David C. Geary, of Missouri, to be a member of the Board of Directors of the National Board for Education Sciences; Miguel Campaneria, of Puerto Rico, to be a member of the National Council on the Arts; and any nominations ready for action.

Mr. President, I ask unanimous consent that the Committee on Homeland Security and Governmental Affairs be authorized to meet on Wednesday, August 1, 2007, at 10 a.m. in order to conduct business meeting to consider pending committee business.

Agenda

Nominations: The Honorable James A. Nussle to be Director, Office of Management and Budget; Dennis R. Schrader to be Deputy Administrator for National Preparedness, Federal Emergency Management Agency, U.S. Department of Homeland Security.

Legislation: S. 680, Accountability in Government Contracting Act of 2007; H.R. 1254, Presidential Library Donation Reform Act of 2007; S. __, an original bill to provide for the flexibility of certain disaster relief funds, and for improved evacuation and sheltering during disasters and catastrophes; S. 1000, Telework Enhancement Act of 2007; S. 1446, National Capital Transportation Amendments Act of 2007; S. 547, Effective Homeland Security Management Act of 2007; S. 1245, a bill to reform mutual aid agreements for the National Capital Region; S. 597, a bill to extend the special postage stamp for breast cancer research for 2 years.

Post Office Naming Bills: H.R. 2570/S. 1732, a bill to designate the facility of the United States Postal Service located at 301 Boardwalk Drive in Fort Collins, Colorado, as the ``Dr. Karl E. Carson Post Office Building''; S. 1772, a bill to designate the facility of the United States Postal Service located at 127 South Elm Street in Gardner, Kansas, as the ``Private First Class Shane R. Austin Post Office''; S. 1781, a bill to designate the facility of the United States Postal Service located at 118 Minner Avenue in Bakersfield, California, as the ``Buck Owens Post Office''; H.R. 2127, a bill to designate the facility of the United States Postal Service located at 408 West 6th Street in Chelsea, Oklahoma, as the ``Clem Rogers McSpadden Post Office Building''; H.R. 2563/S. 1539, a bill to designate the facility of the United States Postal Service located at 309 East Linn Street in Marshalltown, Iowa, as the ``Major Scott Nisely Post Office''; S. 1596, a bill to designate the facility of the United States Postal Service located at 103 South Getty Street in Uvalde, Texas, as the ``Dolph S. Briscoe, Jr., Post Office Building''; H.R. 1722, a bill to designate the facility of the United States Postal Service located at 601 Banyan Trail in Boca Raton, Florida, as the ``Leonard W. Herman Post Office''; H.R. 1425, a bill to designate the facility of the United States Postal Service located at 4551 East 52nd Street in Odessa, Texas, as the ``Staff Sergeant Marvin `Rex' Young Post Office Building''; H.R. 2078, a bill to designate the facility of the United States Postal Service located at 14536 State Route 136 in Cherry Fork, Ohio, as the ``Staff Sergeant Omer `O.T.' Hawkins Post Office''; H.R. 2077, a bill to designate the facility of the United States Postal Service located at 20805 State Route 125 in Blue Creek, Ohio, as the ``George B. Lewis Post Office Building''; H.R. 1617, a bill to designate the facility of the United States Postal service located at 561 Kingsland Avenue in University City, Missouri, as the ``Harriet F. Woods Post Office Building''; H.R. 2025, a bill to designate the facility of the United States Postal service located at 11033 South State Street in Chicago, Illinois, as the ``Willye B. White Post Office Building''; H.R. 1335, a bill to designate the facility of the United States Postal service located at 508 East Main Street in Seneca, South Carolina, as the ``S/Sgt Lewis G. Watkins Post Office Building''; H.R. 1260, a bill to designate the facility of the United States Postal service located at 6301 Highway 58 in Harrison, Tennessee, as the ``Claude Ramsey Post Office''; H.R. 1434, a bill to designate the facility of the United States Postal Service located at 896 Pittsburgh Street in Springdale, Pennsylvania, as the ``Rachel Carson Post Office Building.''

Mr. President, I ask unanimous consent that the Committee on Small Business and Entrepreneurship be authorized to meet during the session of the Senate in order to conduct a roundtable entitled ``Reauthorization of the Small Business Innovation Research Programs: National Academies' Findings and Recommendations,'' on August 1, 2007, at 10 a.m. in room 428A of the Russell Senate Office Building.

Mr. President, I ask unanimous consent that the Select Committee on Intelligence be authorized to meet during the session of the Senate on August 1, 2007, at 2:30 p.m. to hold an open hearing.

Mr. President, I ask unanimous consent that the Committee on Homeland Security and Government Affairs' Subcommittee on Oversight of Government Management, the Federal Workforce, and the District of Columbia be authorized to meet on Wednesday, August 1, 2007, at 2:30 p.m. in order to conduct a hearing entitled Building a Stronger American Diplomatic.

Mr. President, I ask unanimous consent that the Subcommittee on Water and Power of the Committee on Energy and Natural Resources be authorized to hold a hearing during the session of the Senate on Wednesday, August 1, 2007, at 2:30 p.m. in room SD-366 of the Dirksen Senate Office Building.

The purpose of the hearing is to receive testimony on the following bills: S. 1054 and H.R. 122, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Inland Empire regional recycling project and in the Cucamonga Valley Water District recycling project; S. 1472, to authorize the Secretary of the Interior to create a Bureau of Reclamation partnership with the North Bay Water Reuse Authority and other regional partners to achieve objectives relating to water supply, water quality, and environmental restoration; S. 1475 and H.R. 1526, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Bay Area Regional Water Recycling Program, and for other purposes; H.R. 30, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Eastern Municipal Water District Recycled Water

System Pressurization and Expansion Project; H.R. 609, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to authorize the Secretary of the Interior to participate in the Central Texas Recycling and Reuse Project, and for other purposes; and H.R. 1175, to amend the Reclamation Wastewater and Groundwater Study and Facilities Act to increase the ceiling on the Federal share of the costs of phase I of the Orange County, California, Regional Water Reclamation Project.

Mr. President, an Iraq veteran named Travis Williams told his story at a field hearing in Great Falls, Montana last summer. After graduating from Capitol High School in Helena in 2002, Travis quickly joined the Marine Corps. Travis was deployed to Iraq in 2005. He served in Al Anbar province.

Like thousands of other American men and women in uniform, Travis served nobly and with honor under the most difficult of circumstances. He experienced the horrors of combat. He lost numerous friends. And he saw unspeakable violence.

Travis testified that after months of combat, his emotions seemed to dull or shutdown. As he later learned, he was experiencing a normal reaction to a highly abnormal situation. His reaction was a defense mechanism that allowed him to continue to operate in a combat zone. His mind was finding a way to keep going. Thousands of marines, soldiers, airmen and seamen have experienced this phenomenon.

Travis testified that when he arrived home it seemed ``surreal.'' He felt more out of place in his own home than he did in Iraq. Travis isolated himself from his friends. He was frequently drunk and angry. Looking back, he understands that he was on what he called the ``path to destruction.''

One day, Travis received a phone call from Deb McBee. Deb is a veteran's service officer from the Military Order of the Purple Heart. Deb had heard about Travis' experiences in combat. She recommended that he visit the VA clinic to seek help. Travis took her advice. The VA referred Travis to a veteran's liaison for the Western Montana Mental Health Clinic.

Travis connected immediately with his mental health counselor. The counselor was also a veteran who understood the nightmare of combat and the loneliness of coming home. Over time, the counselor helped Travis to get back on track. Before long, Travis was enrolled in a pre-med program and had overcome many of the feelings of anger and loss he had felt before.

I begin with Travis' story because it offers hope. But it offers hope amid a very dark picture facing our veterans. A recent study by the RAND Corporation revealed that American veterans are facing a crisis of epic proportions. RAND estimates that around 300,000 service members suffer from post-traumatic stress disorder--also known as PTSD--or major depression. And 320,000 individuals reported experiencing probable traumatic brain injury during deployment.

The RAND study found that only 53 percent of service members with post-traumatic stress disorder or depression have seen a doctor or mental health provider in the past year. Of those who had a mental disorder and sought care, about half received only ``minimally adequate'' treatment.

Tragically, on any single day, on average, 18 veterans commit suicide. More than one out of five of those vets were patients undergoing treatment by the VA. Think of it: Today, 18 veterans are liable to commit suicide.

The VA has responded to this crisis with numerous initiatives that offer hope to thousands of veterans. This year, the VA will spend more than $3.5 billion for mental health services. Some of these funds will be invested in a new mental health inpatient ward in Helena, Montana. Over the last several years, the VA has opened up hundreds of new rural health clinics. Today, there are more than 700 of these clinics providing health care to our Nation's veterans. Montana has recently received two new rural health clinics in Lewistown and Cut Bank. The VA is making great strides.

But we need to do more. Thousands of veterans still remain out of reach.

The VA has undertaken an aggressive campaign to make mental health care services available to veterans living in rural areas. But thousands of Americans returning from Iraq and Afghanistan live hundreds of miles away from the health care that they need.

The Veteran's Affairs Office of Policy Analysis and Forecasting counts 118,685 registered highly-rural veterans in America. Of these, only 39,158 live within 2 hours of a VA medical center. Thousands of veterans returning from Iraq and Afghanistan often have to choose between a day-long trip to the VA or no care at all. In my home state of Montana 32,404 rural veterans are enrolled in the VA healthcare system. Over 10,000 of those veterans must drive more than an hour and a half to reach a VA hospital. And thousands of those veterans must drive over two hours both ways. In times of crisis, two hours is much too far to drive.

Research conducted by the Department of Veterans Affairs shows that veterans residing in rural areas are in poorer health than their urban counterparts. Nationwide, one out of every five veterans enrolled in VA health care lives in a rural area. Providing quality health care in a rural setting has proved to be a daunting challenge. Limited numbers of doctors and long highways make inadequate access to care all too common.

But let me return to Travis Williams' story. The key lesson of Travis' story is that getting the right care to veterans is all about teamwork. It wasn't just the VA that saved Travis. It wasn't just professional mental health counselors alone. It wasn't just veterans' service organizations. Travis' willpower alone was not sufficient to get him through the hard times. It was all of those things. All of those factors working together helped Travis to get away from a life of anger and despair, and back to a life full of meaning and purpose.

Teamwork is what the Relief for Rural Veterans Act is all about. The bill would enable small rural hospitals, mental health service providers, and other rural providers to work together to respond to the needs of veterans in crisis. States could apply for funding to increase their capacity to deliver mental health services by using state-of-the- art technology such as tele-health and tele-psychiatry.

More specifically, my bill will give the Secretary of Health and Human Services authority to award grants under the Medicare Rural Hospital Flexibility Program. The Medicare Flex Program has a successful 10-year history of strengthening the rural healthcare infrastructure. Under this new authority, States can apply for grants to increase the capacity of rural providers to provide mental health services to veterans and other rural residents. The bill would authorize an additional $100 million for this new authority for 2 years.

The Medicare Flex Program is a good way to improve health care services in rural America. It has provided grants to States to develop State rural health care plans. It supports conversion of eligible small rural hospital facilities to critical access status. It supports rural emergency medical services. And it fosters rural health care network development. It makes sense to expand this program to include mental health services needed by veterans in crisis.

Research conducted by the University of Maine found that small rural hospitals are playing a major role in providing emergency health care services to veterans. They are filling a critical gap in caring for veterans in crisis.

But the Federal Government has not thus far provided funds to help rural hospitals to perform this task. The grants authorized in my bill could support crisis intervention services and other health care services needed by Iraq and Afghanistan veterans. My bill will focus upon those veterans who live far from VA facilities. It could provide relief for veterans who have to drive hours to receive emergency mental health care.

An additional benefit of these grants is that all rural residents, regardless of whether they are veterans or not, would be able to take advantage of the increased capacity of their small rural hospitals to deliver improved healthcare services.

Iraq and Afghanistan Veterans of America and the National Alliance on Mental Health Care have endorsed this bill.

The RAND study I mentioned earlier concluded that we need a major national effort to improve the capacity of the mental health system to care for veterans. The report stated that the effort must include the military, veterans, and civilian healthcare systems.

This bill is one answer to that call. This bill is a way to approach the problems facing our veterans from a new perspective. The philosophy behind the bill is that all agencies that can lend a hand to our veterans should do so. The challenges facing our Nation's veterans are too large for the VA to handle on its own.

Researchers estimate that PTSD and depression among returning service members will cost the Nation as much as $6.2 billion in the 2 years following deployment. That's an amount that includes both direct medical care and costs for lost productivity and suicide. Investing in more high-quality treatment could save close to $2 billion within 2 years by substantially reducing those indirect costs.

Last month, Chairman Bob Filner said this about the crisis facing our veterans: This is not a crisis that only concerns numbers. This is a matter of life and death for the veterans for whom we are responsible.

I urge the VA to continue its efforts to extend its reach into rural areas. I applaud the nation's thousands of volunteers who serve our Nations' veterans. And I offer this legislation as one way to begin a new approach to help those who have sacrificed so much in the name of duty, honor, and country.

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

Mr. President, today, I am introducing legislation to reauthorize and expand the E-verify program, a web based tool run by the Department of Homeland Security for employers across the country. Known as the Basic Pilot Program since its inception in 1996, E-verify provides employers with a process to verify the work eligibility of new hires. This program is set to expire in November of this year.

The Immigration Reform and Control Act of 1986 made it unlawful for employers to knowingly hire or employ aliens not eligible to work in the United States and required employers to examine the identity and work eligibility documents of all new employees.

Employers are required to participate in a paper-based employment eligibility verification system, commonly referred to as the I-9 system, in which they examine documents presented by new hires to verify identity and work eligibility, and complete and retain I-9 verification forms. Under current law, if the documents provided by an employee reasonably appear on their face to be genuine, the employer has met its document review obligation. However, the easy availability of counterfeit documents and fake identifications has made a mockery of the law.

In 1996, Congress authorized the Basic Pilot Program to help employers verify the eligibility of their workers. Participants in this program electronically verify new hires' employment authorization through the Social Security Administration and, if necessary, the Department of Homeland Security databases.

The Basic Pilot was authorized in 5 States until an expansion of the program was agreed to by Congress in 2003. Now, all States and all employers can take advantage of this voluntary and free program.

The bill I am introducing today isn't broad expansion of the current program, which I would like to see done. I attempted to revamp E-verify in 2006 and 2007 when the Senate debated a comprehensive immigration bill. During those debates, I offered amendments to require all businesses to use E-verify rather than maintaining it as a voluntary system. Over time, I would like to see this tool as a staple in the workforce. My legislation today doesn't go that far.

My amendment in 2006 and 2007 also would have changed the verification and appeal procedures, and would have improved the ability of the Federal Government to go after employers who knowingly hire illegal aliens.

While I hope that the Congress can one day address these issues, my priority this year is the reauthorization of the E-verify program. We must not let it expire. Employers rely on it, and we must not pull the rug from under them in their attempt to abide by the law.

My legislation would extend the program indefinitely. There's no reason that we should allow this to expire in 1, 5 or 10 years. It should only expire when Congress feels the need to terminate it. Right now, over 61,000 employers use the program. That number is likely to grow, and they need to be able to know that Congress isn't going to let this program die.

Another provision in my bill would require all contractors of the U.S. Government to use E-verify, even though they have the authority to do so today. Under the original statute in 1996, the Federal Government--including the Executive and Legislative Branches--must comply with the terms and conditions of E-verify. I added this provision because I don't like the progress I am seeing from the administration to require contractors to use the program.

In August of this year, Secretary Chertoff announced a series of reforms to address border security and immigration challenges that our country faces. One of the 26 proposed reforms was to require Federal contractors to use the basic pilot program.

Specifically, Secretary Chertoff said that ``the Administration will commence a rulemaking process to require all federal contractors and vendors to use E-Verify, the federal electronic employment verification system, to ensure that their employees are authorized to work in the United States.'' I firmly believe that the Federal Government ought to lead by example, and they shouldn't wait for my bill to become law.

My bill would also allow employers to check the status of all employees, not just new hires. Since the system is voluntary, businesses should be able to use E-verify to check the work eligibility of all their employees. They would alert the Department of Homeland Security of their desire to check all employees and be required to do the checks not later than 10 days after. If an employer wants to make sure his or her labor force is lawful, or legally allowed to work in the United States, he or she should be afforded that right. Also, the Department of Homeland Security should be able to require repeat offenders of immigration law to check the status of all employees, not just

new hires. My legislation would require certain employers to use E- verify if the Security has reasonable cause to believe that the employer has engaged in the hiring of undocumented workers. This provision will help us hold employers accountable.

My bill would require more information sharing between the agencies at the Department of Homeland Security. Citizenship and Immigration Service, the agency in charge of service and benefits for immigrants, runs the program. However, Immigration and Customs Enforcement has the duty to enforce immigration laws and conduct worksite enforcement. I fear that the two agencies don't communicate enough, especially when it comes to this program. While CIS will provide ICE information about employers who use E-verify upon request, this should be an automatic process. The enforcement agency is better equipped to go after those who hire illegal aliens, and they should have access to such information, including those businesses that receive final non- confirmations through the system. My bill would require CIS to report monthly to ICE.

Finally, as a Senator from a State with many rural communities, I have heard small businesses say they want a system that works and is easy to use. Many towns in Iowa and across the country want to be able to use E-verify but may not have access to computers or the Internet. The Citizenship and Immigration Service has made strides to help businesses learn the system and accommodate their lack of access. As we continue to ramp up the program and potentially make it a requirement for all employers, I would like to see the Federal Government reach out to rural areas and figure out a way to make this work. My bill would authorize the Director of U.S. CIS to establish a demonstration program that assists small businesses in verifying the employment eligibility of their newly hired employees.

In conclusion, I cannot stress enough the importance of making sure E-verify remains intact and operating for employers across the country. We need to reauthorize the program this year so that businesses can continue to abide by our immigration laws. I urge my colleagues to join me in this effort.