Unemployment Benefit Tax Suspension Act of 2008

Mr. President, I rise today to introduce a bill that will provide much-needed relief to struggling families across America. The Unemployment Benefit Tax Suspension Act of 2008 is a critical piece of legislation that would suspend the collection of federal income tax on unemployment benefits for 2008 and 2009.

In light of the calamitous labor market, Congress must act to ensure that workers who lose their jobs do not also lose their livelihoods. On Friday, the Labor Department released sobering statistics that demonstrated the gravity of the situation we face. In November, the economy shed 533,000 jobs, the largest monthly job loss since December 1974. Our unemployment rate now stands at a perilous 6.7 percent, a 15- year high. We have lost 1.9 million jobs since the beginning of our present recession in December 2007--including \2/3\ of those jobs in the last 3 months alone--and the number of unemployed stands at a whopping 10.3 million.

Suspending the federal income tax on unemployment benefits is a simple way to assist our nation's unemployed workers and families. In fact, the CBO has estimated that in 2005, of the 8.1 million recipients of UC benefits, 7.5 million had incomes of under $100,000. As such, most of the benefits of suspending this tax are likely to go to lower- and middle-income families, those struggling harder than ever just to makes ends meet.

During these challenging times, taxes on unemployment compensation represents a burden that unemployed members of our society simply cannot afford. Working families are already suffering, with the high cost of groceries, an unstable energy market, and the outrageous price tag for health care. My bill offers a means to help stimulate the economy by making unemployed workers' benefits stretch farther. While it is certainly not a solution to the problem, it is a step in the right direction.

President-elect Obama has voiced his support for this general idea, calling it ``a way of giving more relief to families,'' and I believe that is the ultimate goal we must pursue in these trying times. I look forward to seeing this bill is passed in a timely manner, so that the impact can be immediate.

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

Mr. President, today I rise to introduce legislation to offer relief to retirees who are being forced to take so-called required minimum distributions from their retirement accounts in a year in which the Dow Jones Industrial Average has fallen a staggering 35 percent. Because retirees are forced to make withdrawals from their retirement accounts, they cannot wait for equities markets to recover and must, in many cases, unnecessarily absorb devastating losses. The Retirement Account Distribution Improvement Act of 2008 would suspend required minimum distribution rules until 2011 to allow retirees the ability to recoup some of their losses.

Under current law, individuals who have reached age 70.5 generally must begin to withdraw funds from their IRAs or defined contribution retirement plans, including 401(k), 403(b), 457, and TSP plans. The withdrawals must begin by April 1 of the year in which an individual attains age 70.5. Failure to take a required minimum distribution may result in a 50 percent excise tax on the difference between what must be withdrawn and the amount actually distributed.

In times that equities markets are rising and retirement account balances are growing, required minimum distribution rules are sensible. Indeed, they ensure the government gains revenue after years of tax- deferred growth. Unfortunately, we are now witnessing unprecedented losses in equities markets that have caused many individuals to suffer steep losses in their retirement account balances. Indeed, the American Association of Retired Persons has said that retirement accounts have lost as much as $2.3 trillion between September 30, 2007, and October 16 of this year. Forcing individuals to liquidate accounts and pay income taxes on the proceeds, as is required under current law, instead of allowing them to wait until the market recovers and continue to defer tax, simply adds insult to injury. Moreover, mandating withdrawals may cause stock prices to fall, hurting other investors.

It is for these reasons that I am today introducing legislation to waive minimum required distributions for the 2008 to 2010 period. Under my legislation, retirement plan custodians would be prohibited from making required distributions unless an individual specifically asked that funds be withdrawn. Plan custodians would have to send individuals a notification to alert them that they must make an affirmative election to receive funds from their accounts. Finally, to benefit individuals who have already taken a required minimum distribution for 2008, the bill would allow a re-contribution of those amounts into a retirement account by July 1, 2009.

I am aware that others have proposed variations on the provisions I am introducing today. For example, Treasury Secretary Henry Paulson may be considering very short-term administrative relief. While well intentioned, this approach does not guarantee meaningful long-term action. Meanwhile, others have drafted legislation to suspend minimum distribution rules. Notably, Senators Baucus, Grassley, Kennedy, and Enzi, offered legislation, The Worker, Retiree and Employer Recovery Act of 2008, before the Thanksgiving Recess, a measure that I have cosponsored because it includes many worthy provisions such as a one- year waiver of required minimum distribution rules. While I greatly appreciate their efforts and hope that we can clear that bill as early as today, we must do more. A 1-year waiver of minimum distribution rules is simply a good start, but with many predicting a multi-year recession, I believe the waiver should be at least 3 years.

Congress must adopt a longer-term approach to helping individuals protect their retirement assets and weather the current economic storm. Individuals may require several years to recoup losses they have sustained, and by enabling them to keep assets in their retirement accounts until 2011, this bill offers them that opportunity. After 2 years, Congress can reevaluate whether the waiver of current-law rules should be further extended. I urge all Senators to consider the benefits this legislation will provide to millions of retirees all across the United States, and I look forward to working with my colleagues to enact it in a timely manner.

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

Mr. President, I rise today with my good friend Senator Ensign to introduce the Elko Indian Colony Expansion Act of 2008.

The Te-Moak Tribe of Western Shoshone Indians of Nevada includes four constituent bands, each having a separate reservation or colony in northeastern Nevada. One of the Te-moak Tribe's bands--the Elko Band-- has a strong need for additional land. While their population has steadily grown, their land base has remained the same for over 75 years. This legislation would direct the Secretary of the Interior to make a reasonable expansion of the Te-moak Tribe's Elko Colony by taking 375 acres of land into trust.

The histories of the city of Elko and the Elko Indian Colony have long been intertwined. Elko was established as a railroad town in 1868 with the construction of the Central Pacific, part of the first transcontinental railroad. Shoshone families that had long lived in the area camped nearby to work on the railroad and in the area's mines and ranches.

Government officials tried to relocate Elko's Indian families and all Western Shoshones to the Duck Valley Indian Reservation, 100 miles to the north of Elko, when it was created in 1877. The families refused to leave, however, and managed to stay in the Elko area. When the government's formal relocation policy failed, separate ``colonies'' for remaining Shoshone families were established. In 1918, President Woodrow Wilson reserved 160 acres for the Shoshone Indians near Elko by executive order. Another 33 acres were later purchased by the Bureau of Indian Affairs, BIA, and were made part of the colony by Congress in 1931.

Today the Elko Colony is a thriving community. More than half of the Te-Moak's Tribe's enrolled members live and work in Elko, yet the Elko Colony has one of the smallest land bases of the four constituent bands. Over 350 tribal members are forced to live off of the colony because of a lack of reservation housing. Our legislation would address this need for more land by directing the Secretary of the Interior to take approximately 375 acres of land into trust for the tribe. These lands are currently managed by the Bureau of Land Management, BLM, and are adjacent to the existing Elko Colony. The land would be available for residential or commercial development, or for traditional uses, like ceremonial gatherings, hunting, and plant collecting.

We have received strong letters of support for this proposal from both the City of Elko and Elko County. It is always encouraging when communities come together to work on a project like this, and we are grateful for their collective work on this effort. I also want to highlight that the city has a number of rights-of-way that cross the land in question, and our legislation is designed to protect those interests.

This bill will do so much to improve the lives of the Elko Band of the Te-Moak Tribe. We are pleased to bring this legislation to the committee and we look forward to working with Chairman Bingaman, Ranking Member Domenici and the other distinguished members to move this bill through the process.

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

Mr. President, I have sought recognition to introduce legislation to temporarily suspend the requirement that persons aged 70\1/2\ and over take minimum distributions from their pensions or Individual Retirement Accounts, IRAs.

I offer this legislation because of the economic situation our country is in at this moment. At a time when our financial markets are so greatly unstable, the government should not be requiring people-- especially retired citizens likely living on fixed incomes--to take money out of the markets. If seniors need this money, and want to take this money out of their pension plans, they should certainly be allowed to do so. But right now, while the markets are so unpredictable, I think it is wise for Congress to suspend the requirement that persons aged 70\1/2\ and above take mandatory distributions from their pensions, 401(k)s, and IRAs.

The legislation I am introducing today will suspend this requirement for 1 year. Recently, forecasters at the Federal Reserve Bank of Philadelphia estimated that the United States will

enter into a recession lasting approximately 14 months. While I certainly hope that they are wrong, and our economy begins to improve as Congress looks at various ways to stimulate the financial markets, I think we must be prudent in preparing for the worst. A 1 year suspension of the required pension distribution rule would allow time for the markets to stabilize. If, a year from now, our financial situation has not vastly improved, I believe it may be prudent to visit this issue again.

This legislation is a simple fix that will have a significant impact on both the financial markets and the portfolios of our senior citizens. Requiring seniors to take disbursements from their pensions or IRAs now will also likely mean that, with the markets at such a low point, seniors will be losing a significant amount of money. Current tax law not only is hurting the financial markets with this rule, it is also hurting the wallets of seniors who will see smaller distributions and dwindling pensions. If seniors don't need these distributions right now, let them keep their money in their retirement plans until the markets can rebuild and boost the amount those retirement plans are worth.

Another provision in this legislation would allow retirees who have already taken distributions in 2008 to reinvest those distributions back into their pension plan without penalty. This again would put money back into the markets if the recipients don't yet need the money at this time.

I hope that we will be able to weather the current financial storm we are in quickly. Through small measures like this one, in conjunction with the larger measures that Congress has already done, we can begin to bring stability to the markets. I look forward to working with my colleagues on this and other legislation to help the families in this country who are hurting because of the economic downturn.

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