SECURE Act

First, I thank my good friend from Florida for his heartfelt and his always articulate words. We are now going to debate, finally, the reauthorization of the Terrorism Risk Insurance Program.

Senator Crapo and I have opening statements, but Senator Tester, who has added an extremely important amendment to this legislation, has a markup shortly, so we are going to accede and let him speak about his amendment first, and then we will get on with our opening statements. I thank Senator Tester for his hard work on this issue as well as his ability to compromise to get something done.

Mr. President, I thank my colleagues from Montana and Nebraska for their hard work on not only this legislation but their very important amendment--long overdue. I certainly thank Senators Johnson and Crapo, without whose leadership we couldn't be here to pass this bill. I thank my original cosponsors, Senator Kirk from Illinois who is here, Senator Jack Reed, Senator Heller, Senator Murphy, Senator Johanns, Senator Warner, Senator Blunt, and Senator Menendez, all of whom recognized the importance of having this incredibly important program reauthorized.

As author of the original TRIA legislation, I have watched this evolution closely. I could not be more convinced of the necessity to reauthorize the program for the long haul.

I remember the dark days right after 9/11. I was there. The worst thing was the loss of life--people we had all known. I know people who were lost--a guy I played basketball with in high school, a businessman who helped me on the way up, a firefighter with whom I did blood drives. But there was also the economic worry. People thought southern Manhattan would not come back. People thought businesses would flee New York--that New York's greatest days were behind us. And of course the people of New York, with their resiliency, backed up by everyone in this country--including President Bush, very strongly--did come back. But the uncertainty we faced in the immediate aftermath was that there would be no building in southern Manhattan or Manhattan at all. And we have some history.

One of the things that greatly stood in the way was the private sector did not offer any sufficient coverage to protect against the threat of terrorism. No one knew when there might be another terrorist incident. Insurance companies, knowing how large the losses were, figured it was better not to underwrite insurance than write it for such an astronomical sum that the building would not be even economically feasible.

We have some colleagues who said this should be a private sector endeavor. Well, we have history. The private sector was unable, because of the potential economic losses if, God forbid, there was another terrorist attack, whether it be conventional, nuclear, or chemical, to provide terrorism insurance. When that occurs, banks would not finance buildings, knowing there was no insurance backup, and we would have been in huge trouble. That is why we devised the terrorism insurance bill.

For those who say let the private sector do it, we have an experiment. We have what the scientists would call a controlled experiment. When there was no terrorism insurance after 9/11, the private sector would not offer insurance. We even find to this day, as the existing bill expires, fewer people underwrite terrorism insurance and fewer buildings are financed.

So we can do one of two things: We can sit back and let the market handle this on its own and lose millions--literally millions--of jobs, lose economic stability, safety, prosperity, and growth or we can renew this legislation. We can come up with a smart, responsible, risk- sharing system where the private sector is paying upfront. But if, God forbid, there is another serious incident beyond the capability of the private sector to shoulder, the Federal Government can step in and provide a backstop. That is what we have done.

The TRIA Program is a shining example of the government partnering with the private sector to solve problems that neither can solve on its own.

Let me underline, first, the importance to my city of New York. The redevelopment of downtown Manhattan is booming there. People are flocking to live there and work there. It is the hot area of New York again--not just with financial services but with law and advertising and high-tech. It serves as a reminder of the role the Federal Government can and should play in helping facilitate the stability and growth of cities across the country.

This bill will not lessen the impact of a terrorist attack but will help ensure that our cities throughout the country are less vulnerable to the economic devastation that would follow such a horrific event.

But this bill is hardly just focused on New York City. It not only affects every large city--my good friend from Nebraska spoke--it affects the football stadium and any renovations that might occur there in Lincoln. I have been there for a Nebraska-Oklahoma game. It was an amazing experience. It affects any city that has large gatherings of people and buildings--shopping centers, athletic facilities, colleges. So it affects almost every State. That is one of the reasons we have come together and gotten such broad bipartisan support.

We must make sure that every reauthorization of the program provides the certainty lenders and developers need to make the kind of long-term investment our country and large projects need to stimulate job growth and economic growth, and this bill does just that. That is why it was passed out of the banking committee unanimously.

Again, I thank my colleagues, particularly on the other side of the aisle. As Senator Johanns said--and we say it on each bill where there is some bipartisan support--this one has overwhelming support. Maybe this bill can be a model that at least on many issues we can work together.

Time is of the essence. Insurance policies for 2015 are already being written. Each day that goes by without a TRIA Program causes great uncertainty in the market and holds back the potential for more development, more construction, more jobs, and more economic growth.

I will talk about the amendments later, but I urge my colleagues, both here in the Senate and in the House, to move as quickly as possible because our economy is greatly affected by it. It is one of those that ``runs quiet, runs deep.'' It is a quiet policy but a policy that greatly affects lots of things that go on.

Again, I thank my colleagues, Senator Crapo for his good and hard work, as well as Senator Johnson and my cosponsors.

I yield the floor.

Senator Crapo listed some letters and asked that they be put in the Record for some groups supporting our legislation.

We have a very long list, and I ask unanimous consent that list be added to the Record, the supporters of the legislation.

Now I would like to discuss the amendment process to preview it for my colleagues a little bit.

I would also ask unanimous consent that quorum calls be counted equally against both sides.

As was mentioned, I believe by some of my colleagues, the give-and-take on this bill was ideally how things should work. First, a bipartisan group of Senators got together and crafted the legislation. As Senator Crapo noted, there was some push and pull, what should be the balance between government and the private sector, and we did move a little bit more in giving greater responsibility to the private sector. People should note that at the end of the day the private sector will pay back all the money the government would lay out if, God forbid, there is a terrorist incident, but it would be over a period of time of course.

But we had Democrats and Republicans come together and we came up with a bill. The chairman and ranking member agreed that the bill was a good idea, held hearings, and then we moved forward with the legislation.

Then always comes the even greater morass. We do get some bills passed out of this place with bipartisan support and many of them are significant bills, but then we go to the floor and we wonder what is going to happen now. We have the age-old dispute about how many amendments, what type of amendments, should they be relevant. In this case we asked colleagues on both sides of the aisle who would want amendments.

The amendments that came back were reasonable. Most--not all--were related to terrorism insurance. Those that weren't, such as by Senator Tester and Senator Vitter, were in the jurisdiction of the Banking Committee, so they at least had some relationship. We did not get a flurry of amendments from all over the place on issues that naturally divide the parties.

Then we had to do some negotiating, but we allowed--Senator Crapo and Senator Johnson allowed every amendment, that any author who wanted to offer an amendment could. We worked out some compromises on the Tester amendment. Senator Coburn had objections, and a compromise was worked out there. Some were withdrawn, but at the end of the day anyone who wanted an amendment got it. Both sides showed restraint, and I think that is what brought us to this position.

So the good news for my colleagues, we have a very limited number of amendments, and we intend to dispose of the entire bill before lunch this morning.

Let me briefly go over the amendments.

Senator Coburn will offer an amendment on recoupment timing. The Coburn amendment would give the Treasury Secretary the ability to extend the recoupment period of up to 10 years following an attack. The problem is the way Senator Coburn had drafted his amendment, it would create a significant score. He offered in it the Banking Committee and it failed on a bipartisan vote, the majority of both parties, I believe, voting against it. But he wanted to offer it on the floor, and so he will.

There is a point of order, a pay-go point of order that will be raised against the Coburn amendment, and I will raise that because it does break the budget. It doesn't have a pay-for in exchange for it. So Chairman Johnson and I believe the sponsors of the legislation recommend a ``no'' vote on waiving pay-go against the Coburn amendment.

The Tester amendment, as modified by Senator Coburn, I believe will be voice-voted. Senator Tester and Senator Johanns described that adequately, but it is something long overdue that would create a National Association of Registered Agents and Brokers and make the whole brokerage business work more smoothly. It has very broad support in this body.

Senator Vitter will offer an amendment that would require the President to nominate at least one individual with primary experience working in or supervising community banks on the Federal Reserve Board of Governors. I am sure he will come to the floor to explain his amendment. We expect this amendment, which we will all agree to, will be approved by voice vote, and Chairman Johnson has recommended a voice vote to the Members on our side.

Finally, there is a Flake amendment that would create an advisory committee on risk-sharing mechanisms. Again, I think Senator Flake will come down at some point and explain his amendment. There will be a recorded vote on this at least as planned now, and I will be supportive and I know Chairman Johnson again has recommended a ``yes'' vote on the Flake amendment.

With that, I note the absence of a quorum.

Once again I thank the chair and the ranking member of the banking committee, Tim Johnson and Mike Crapo, for their great work.

I say to my colleagues, this is a very good example of much cooperation--bipartisan cooperation, Democrat and Republican--a 22-to-0 unanimous vote out of the committee. It is also cooperation between private industry and the government. Industry, insurance, and others knew they had to shoulder a greater share of the load as we move on after 9/11 but that only government could be the backstop at the end of the day.

Again, this is an economic development issue above anything else. It is not out of whose pocket what money comes. If the greatest problem America faces is good-paying jobs--well, if we were not to renew terrorism insurance, we would lose many good-paying jobs.

This amendment will allow those jobs to continue and grow. People will

not build major edifices, major complexes--whether they be skyscrapers in Chicago or New York, whether they be football stadiums in Idaho or South Carolina or major shopping centers in South Dakota--unless they know there is a backstop, because insurers will not insure if they think terrorism could just totally wipe them out. And that means we wouldn't get financing for these projects.

It is an outstanding piece of legislation. My hope, in conclusion, is that the House would pass our bill. We know there are some concerns in the House, but there is a bipartisan coalition of Democrats and Republicans who really favor the approach we have taken. I know there are some in the House who don't believe government should be involved here, but that is, with all due respect, a purist view.

We have cut back on some of the government's obligations. Mike Crapo and many of our colleagues from the other side of the aisle made that happen. But at the same time, without the government backstop, we would do real harm to our economy.

I hope we can get a very large vote in the Senate--bipartisan-- because if we do, it should importune the House to perhaps pass our legislation.

I suggest the absence of a quorum.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I wish to make a couple points on the Coburn amendment, and then I will raise a point of order.

The current bill, S. 2244, is budget neutral, as the past TRIA bills have been. On the other hand, CBO has said Senator Coburn's amendment is not fully paid for, violating the Senate's PAYGO rule.

Basically, the amendment--even though I know the sponsor does not intend it that way--is a killer amendment. CBO has said the amendment would cause S. 2244 to increase the Federal deficit in both the 5-year and 10-year budget windows.

Senator Coburn offered this amendment in committee. It was roundly defeated by a bipartisan vote of 16 to 6 against it.

I appreciate Senator Coburn's effort to provide more flexibility to the timeframe for recoupment by the government in case of a terrorist attack, but in fact the banking committee, led by Senator Johnson, and my office have worked with CBO for a number of months to determine whether there could be more flexibility in the recoupment process. Unfortunately, CBO has yet to identify a way to provide more flexibility in the recoupment period while still ensuring the program remains budget neutral as it is now.

It is also important to note that if recoupment by the government poses any unforeseen challenge after a future attack, nothing would stop the Treasury Secretary from asking the Congress then to provide that flexibility.

The bottom line is that TRIA is too important to allow this amendment and nonreauthorization of the program because it is not budget neutral. We don't want to give anybody an excuse.

I am hopeful Senator Coburn will support TRIA's final passage, even if his amendment isn't agreed to, as he did in committee. But for those of us whose priority is to reauthorize this program, I urge my colleagues to vote to sustain the budget point of order and oppose the amendment.

Mr. President, I raise a point of order that the pending amendment violates section 201 of S. Con. Res. 21, the concurrent resolution on the budget for the fiscal year 2008.

Mr. President, I yield back all time.

I ask for a voice vote.

This is a good amendment and will be supported by Chairman Johnson and myself.

I yield back all time.

Mr. President, I yield back all time and ask for the yeas and nays.

Mr. President, I am appreciative of Senator Schumer and the work we have been able to do together to move this legislation forward.

I rise today to speak in favor of S. 2244, the Terrorism Risk Insurance Act, or TRIA, program. As a cosponsor of this bill, I recognize Senator Schumer, Senator Kirk, Senator Heller, Senator Reed, and others for helping to put this bipartisan piece of legislation together.

Chairman Johnson and his staff also deserve a great amount of thanks for their strong efforts in moving this bill forward.

Working together, we developed a balanced bipartisan product that was literally unanimously supported in the banking committee 22 to 0. This bill we have put together allows the private insurance industry to absorb and cover the losses of all but the largest acts of terror--ones in which the Federal Government would likely be forced to step in, in any event, if the program were not there. Taxpayer protections have been increased in this reauthorization by moving more of the responsibility for losses on to private insurers.

For those who are not familiar with the program, TRIA was initially passed as a response to the unavailability of terrorism insurance in the wake of 9/11. The private market had already retreated in response to those terrorist attacks. It was then thought that a temporary program would allow the market time to develop products that would allow policyholders to protect themselves from terrorism losses.

More than a decade after the tragic events of 9/11, the temporary inability

to insure against terrorism has abated, and private capital is better positioned to take on more exposure to terrorism.

When the banking committee held its first hearing on TRIA's reauthorization last year, we discussed the ability of the private insurance market to step in to provide terrorism insurance if the TRIA Program expired. In that hearing, and in subsequent meetings with providers, policyholders, and stakeholders, we recognized on a bipartisan basis the continued difficulties associated with providing terrorism insurance required that we look again at extending the act.

Terrorism is difficult to predict. Therefore, the ability to develop products to insure against terrorism is very difficult to do. The size, severity, and frequency of attacks are hard to model. Also, attacks may be highly correlated, making it difficult for private insurers to diversify their risks.

Having TRIA in place was determined to be important. But if the market is too heavily reliant on Federal support, we may deter private companies from coming up with cost-effective solutions. That is why, instead of a straight reauthorization, I and others pushed for reforms to maintain the program and increase protections for taxpayers.

In order to do that, we examined each of the policy levers in the program. The bill marked up by the banking committee would increase the insurance industry's aggregate retention level and the company coinsurance levels. As the program stands today, the Federal Government would recoup any TRIA payments it makes up to $27.5 billion through post-event payments. This industry retention level allows the taxpayer to recover TRIA payments through an industrywide assessment on property-casualty policies. This aspect of the bill was last changed in the 2005 reauthorization. The bill before us today increases that recoupment level by $2 billion a year, to an overall level of $37.5 billion--an additional $10 billion. This is a significant reduction in the potential exposure and cost to taxpayers.

In addition, the bill increases the company coinsurance level from 15 percent to 20 percent over 5 years. This means that before the backstop is reached, each company will take on a greater portion of the losses above their deductible.

In order to get more private capital in the marketplace, Senator Flake has an amendment to create an advisory committee to promote the creation and development of private sector risk-sharing mechanisms. I support the addition of the Flake amendment and believe the advisory committee will find private sector solutions that will allow us to further decrease the program in future reauthorizations.

Before I conclude, I have a handful of letters in my possession here from groups across the country strongly supporting and encouraging that we adopt this legislation.

The U.S. Chamber of Commerce has listed this as a key vote. The Coalition to Insure Against Terrorism, which represents dozens and dozens of the financial sector interests across this country, recommends and encourages that we support this legislation, and the Mortgage Bankers Association, the National Association of Insurance Companies, the Property Casualty Insurers, the National Apartment Association, the National Multifamily Housing Council, and the American Builders Conference.

These are just a sampling of letters we have received from interests across the Nation that support this legislation. I ask unanimous consent that these letters be printed in the Record.

Getting terrorism risk insurance right is important in order to protect taxpayers and to limit economic and physical impacts of any future terrorist attacks on the United States. This bill will help us maintain a properly balanced terrorism risk insurance program that increases the Nation's economic resilience to terrorism. Again, I thank Chairman Johnson and Senators Schumer, Kirk, Reed, and Heller for their partnership in bringing this bill forward and encourage its adoption.

Mr. President, I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, I wish to take this opportunity to make comments on a couple of the amendments that have been or will be presented to the bill.

First, with regard to the amendment presented by Senator Flake. As I mentioned in my opening remarks, I support this amendment. One of the issues we deal with in the reauthorization of TRIA each time we face it is the correct balance and the level of government protection and support that needs to be in place to help the market deal with major catastrophic events in the United States and the level of requirement we insist there be from the private sector and how they will step in and deal with these risks on an insurance basis rather than requiring the taxpayers to be the ultimate backstop.

Ultimately our objective should be and must be that the taxpayer be relieved of this kind of burden and that the private sector step in and cover the risks through our private sector insurance markets. I think we have a pretty broad consensus that we are not at the level yet where we can get there, but each time we have reauthorized TRIA, we have moved it closer to that objective, and this legislation itself moves it closer.

As I said in my introductory remarks, we have increased the retention level--in other words, the amount of money the private sector must pay back to the Treasury if the taxpayer is ultimately required to step in and backstop a catastrophic terrorist attack. This legislation will increase that amount by another $10 billion--from $27.5 billion to $37.5 billion. We are also increasing the amount of money which the private sector insurance industry must put up upfront before the government steps in and provides a backstop. We are increasing that from a 15-percent copay to 20-percent copay.

We are taking significant steps in this legislation to get to the ultimate objective of having the private sector fully handle the insurance risk due to a catastrophic terrorist attack.

Senator Flake has provided an amendment, which I support, that would help us create an advisory committee that will focus on this specific issue and help us to find private sector solutions to allow us to further decrease the program in the future reauthorizations. I think this is an incredibly important amendment, and I believe there is strong bipartisan support for it. It allows us to have advice and support from this advisory committee that would be created under his amendment to take further and more important steps toward achieving the ultimate objective of having to be able to eliminate the need for taxpayer involvement in dealing with catastrophic events such as a terrorist attack.

I strongly support the addition of the Flake amendment. I believe the advisory committee he proposes will find private sector solutions which will allow us to further decrease and ultimately eliminate the program in future reauthorizations.

Another amendment that has been discussed on the floor today by Senator Tester of Montana and Senator Johanns of Nebraska is the NARAB amendment, which is an amendment that will be added to this legislation. This is also an important piece of legislation from the banking committee and it is called the National Association of Registered Agents and Brokers, or NARAB. Again, it is a bipartisan piece of legislation that has strong support across the United States in various industries to try to allow our registered agents and brokers to have a more efficient and effective system in which to obtain necessary authorization to conduct their business nationwide.

I am an original cosponsor of this language because it simplifies the process of agent licensing across State lines while preserving the authority of State insurance regulators. This bill has broad support from the insurance community, including the National Association of Insurance Commissioners, the Independent Insurance Agents and Brokers of America, the National Association of Insurance and Financial Advisers, and the Council of Insurance Agents and Brokers.

The creation of NARAB will allow agents and brokers to focus on their responsibilities to their clients and spend

less time dealing with redtape. By reducing costs and increasing competition among insurance producers, we will generate lower costs and better service for consumers. Importantly, NARAB II deals specifically with marketplace entry and would not impact the States' jurisdiction over day-to-day authority in the insurance marketplace. This is a very critical point because I believe one of the biggest issues relating to this legislation is preserving and protecting States rights and State jurisdiction with regard to regulation of the insurance marketplace.

Insurance commissioners of the States will be able to better catch bad actors who, after losing a license in one State, move quickly to enter into another State. State regulators will serve on the board of NARAB with the same objectives they have as insurance commissioners--to protect the public interest by promoting the fair and equitable treatment of insurance consumers.

The idea for NARAB is now 14 years old. We have literally been working on it for that long, and I am hoping we can get this legislation across the finish line today.

These are two important amendments that will come forward today with regard to the TRIA legislation, and there are several more. As we move forward today I am hopeful we will make the kind of progress on these important and critical issues that will enable us to not only pass this legislation but to do so with a strong vote here in the Senate and then get us into a conference with the House so we can put this important legislation, which has been developed on a bipartisan basis, on the President's desk.

Far too often we are seeing gridlock in this Chamber. We have two pieces of legislation today where we have a bipartisan agreement and bipartisan support, and I think it is a good day for the Senate to see this kind of legislation moving forward.

I yield the floor.

Mr. President, I will just take a moment to speak about Senator Vitter's amendment, which I strongly support.

During Dr. Yellen's nomination hearing, I noted the need to fill additional vacancies at the Federal Reserve Board with individuals bringing balanced viewpoints. The President should nominate someone with community bank experience to the Board to fill at least one of the remaining vacancies.

Community banks play an important role in their local economies and face a disproportionate burden from our existing regulations. We should ensure that the perspective of these banks is represented in policymaking. That is what this amendment does, and I encourage my colleagues to support it.

I ask unanimous consent that the order for the quorum call be rescinded.

Mr. President, as we near the votes on this bill, I wish to take one more opportunity to speak in favor of the TRIA reauthorization legislation.

Again, I thank Senators Schumer, Heller, and Kirk and their staffs and Senator Reed for all their hard work in bringing forward this legislation.

I also thank Chairman Johnson and his staff for moving forward so quickly and aggressively on this legislation. Together, we were able to put together a bill that allows the program to continue to function while increasing the movement toward ultimate taxpayer protection.

As I mentioned before, we were able to approve this bill out of committee with a 22-to-0 unanimous vote. The agreement of all the members of the banking committee that we should move this bill forward speaks to the importance of this critical legislation and to the level of the added taxpayer protections we were able to build into it.

Our bill increases the level of losses that the private sector will absorb before reaching the Federal backstop. We do that by increasing the coinsurance level of any company participating in TRIA so that each company will shoulder a greater percentage of the losses. We also increase by $10 billion the level of mandatory post-event recoupments to $37.5 billion, which means that the taxpayer will ultimately recover all TRIA losses except in the most extreme events.

This bill will continue a program that reduces our economic vulnerability to terrorism, and I encourage my colleagues to support it.

One last time, I thank Senator Johnson and Senator Schumer for their strong support and for our ability to work together and break the mold, if you will, by having a bipartisan movement forward on this important and critical legislation.

With that, I yield the floor.

Mr. President, pursuant to section 904 of the Congressional Budget Act of 1974 and the waiver provisions of applicable budget resolutions, I move to waive all applicable sections of that act and applicable budget resolutions for purposes of the pending amendment, and I ask for the yeas and nays.

Thank you, Mr. President. Let me join my friend Senator Crapo in congratulating the leadership on both the Republican and Democratic side and the leadership on the banking committee for bringing this bill before us this morning. It is, unfortunately, all too rare when we can bring a piece of legislation to the floor that has been worked on by both sides of the aisle and has broad agreement on both sides of the aisle. Of course, as the Senator from Idaho knows, there is nothing partisan about the effects of not reauthorizing TRIA. This is going to affect every part of the country. Republicans and Democrats, people of liberal and conservative persuasions, will ultimately be paying a lot more and losing a lot more because of our failure to get this bill done. So let me again thank Senator Crapo and Senator Johnson for all the work they have done. I was one of the original cointroducers of this bill, along with Senator Schumer and Senator Reid, as well as Senators Menendez, Warner, Kirk, Heller, Johanns, and Blunt.

Ultimately, we were educated by what happened in the weeks and months following September 11. In that period of time, the real estate market in large parts of this country--certainly in my part of the country surrounding New York City--collapsed. As a result, $15 billion worth of projects stalled overnight, and we lost about 300,000 construction jobs that were planned to come online--all because the insurance industry decided, with justification, that they could no longer insure for the risk of terrorism. Prior to September 11 we got coverage for terrorism essentially at no cost. But after September 11, again, for good reason, for good cause, insurers, without knowing what their exposure was going to be should there be another attack, decided they could no longer insure for that risk. So, in this sense, it logically fell to the Federal Government to provide that assurance that no matter where one is--whether in Idaho or Nebraska or Connecticut or New Jersey--if a person is building a project and they were the subject of terrorism, they would get a backstop of protection for those losses.

Some said at the time: Why don't we treat insurance, when it comes to protecting for terrorism, the same as we protect against other disasters? Of course, we see these threats as fundamentally different. We can make a decision as to whether we want to live in a part of the country that may be subject to greater risk from floods or hurricanes. So we have grown to accept the fact that we are going to pay a little bit more if we are going to have a house or a business right on the water. And we have a program here by which we mitigate that risk so that it is not extraordinarily different, understanding there is still good reason why people have to congregate in those spaces. But a terrorist attack, frankly, whether it happens in New York City right on the precipice of Connecticut, or in Los Angeles or in a rural environment in the Midwest, is an attack on the United States of America. That is an attack on all of us, no matter what specific geography in which it happens to be located. So that is why we made the decision as a Nation to help backstop those localities that may feel the initial burden of having to reconstruct after a terrorism attack, because we believe it is a national responsibility.

So for the practical reason that there was no longer an ability for the insurance industry to calculate how on Earth they would assess a premium based on the enormous potential loss of a terrorist event, and because of the fact that as Americans we felt as though we should come together and insure against this risk, we passed TRIA initially. Over time we have come together as Republicans and Democrats to reauthorize it.

Now, as time has gone on, we have had a conversation about how to best share this responsibility between the public sector and the private sector, because we expect that private insurers still should, as is their business, pick up some of this cost. So this version of the bill continues along the line of transferring some of this responsibility from the Federal Government and the Federal taxpayers to private insurers. For instance, the underlying legislation continues to have a 20-percent deductible. But after that 20-percent deductible is met, under the previous version of the bill the insurer was responsible for picking up 15 percent of the cost. Under this bill they are going to pick up 20 percent of the cost. So there is a little bit more responsibility built in for the cost of paying out claims after a terrorist attack is picked up by insurers.

There is a provision in the bill which says the Federal Treasury will recoup the costs from insurers of any claims it pays out. It can do that over a long period of time. Previously, it was mandatory to recoup all of that money for claims under $27 billion. Now that number is $37 billion. So we now have a mandatory return to the Treasury of any claims under $37 billion, which is an additional protection for taxpayers as well as an additional responsibility for insurers now because we will collect from the insurers for losses up to a higher amount than the previous law. I think all of this is pretty reasonable.

I wish there were more days such as this and weeks such as this-- although maybe TRIA isn't infused with the same kind of politics that other issues such as immigration reform and energy reform and criminal justice reform can be--but this was made possible by some really hard work by a number of people who knew this was right to do for the country. Speaking as a Senator from a State that has a big stake in the reauthorization of TRIA, I say thank you to all of the people who made this possible and give an advanced shout-out to the House of Representatives which we hope will pass this bipartisan bill in an expeditious manner. Connecticut cares about this because we were, as I said, on the edge of the attack of September 11. We lost dozens and dozens of Connecticut residents in that attack. Our economy was effectively shut down because of the inability to assess this risk throughout the real estate sector surrounding New York City. But we also are home to some of the biggest and, frankly, most responsible property and casualty insurers. The Hartford and Travelers, in particular, have been a big part of trying to figure out a public- private partnership to solve this problem, and this certainly helps them to be able to provide more of a very important product to the rest of the country.

So, again, my thanks to all of those who made this piece of legislation possible. My hope is we get a big vote later today across the aisle, sending a message to the House of Representatives

that they can take this bipartisan piece of legislation, pass it, and then get it to the President's desk. Then we can, once again, give some sense of surety to our insurance markets and our real estate market that the United States of America is, once again, going to step up and decide that terrorism, no matter where it happens--whether it is in New York City or in Topeka--is not going to get this country back.

I yield the floor, and I note the absence of a quorum.

Mr. President, I ask unanimous consent that the pending amendment be set aside and my amendment No. 3549 be called up.

Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

Mr. President, we have before us a bill where unfortunately we do not believe in markets. We are told markets will not work, so we have a terrorism risk insurance bill. That means the Federal Government is going to be the insurer of last resort. There have been some improvements over what we have put forward in the past, and I agree with those improvements if in fact we have to do this. I am not convinced we have to do it, but we are going to do it, and I understand that. I think the work of the committee, of which I am a member, has been very good.

But there is one real problem with this bill, and it is about smoke and mirrors, it is about not being honest with the American people. This bill was designed so it would have no score. It was not designed to do the best we can for America should we have a tragedy, and it was not designed to create the flexibility that would be necessary if we do have a tragedy.

Let me outline this for you. The way this bill is set up is that we could have a significant tragedy, God forbid, in this country from a terrorist attack, and the bill will mandate spikes in casualty and property insurance far above what will need to happen because we passed the bill to pass a CBO score. So what could happen is we would have to collect billions of dollars over an 18-month period through premium increases on everybody in the country, not just where we had the problem--everybody in the country--because we have designed a bill that will in fact mandate that or at least could mandate that.

I have been around this place for 10 years. I know exactly what is going to happen if that comes about through this TRIA bill. The first thing that will happen is the Senate and the House will pass an elimination of this requirement. So what will happen is the American taxpayer will get stuck with all this. They all know that. Everybody agrees they designed the bill to meet CBO. So what I put in was an amendment that would give flexibility to the Treasury so we do not, after one tragedy, create another tragedy with markedly elevated casualty and property rates. We still recoup the money, but we do it over a longer period of time, if it is necessary, and we give the Secretary of the Treasury the ability to do that.

My friend from New York says there is a budget point of order that lies against it. It does according to CBO. I agree, it does. But the difference between this and most budget points of order is my amendment will not increase the deficit one penny--not one penny.

I would also note that my colleague from New York has voted to override budget points of order every time they have been offered this year. So it is going to be curious to me to all of a sudden have a budget point of order raised by someone who has voted to override the budget point of order every time it has been offered in the Senate this session, and it goes to why we should not pass this bill without common sense in terms of how we collect the recoupment.

I understand the constraints of CBO, but I also understand common sense. So we are going to play the game on the constraints, and we are ultimately going to pass on--rather than recoup--we are ultimately going to pass it on to the American taxpayer, which hollows out the whole purpose of the bill.

So this has a billion-dollar score, on which we are going to have a point of order, which I am sure I will lose. But when you vote for this bill, know you are not voting for what the bill says it is going to do because it is going to do something completely different than what it says, if we were to have one of these catastrophies.

The political pressure to not have these massive increases in property and casualty insurance--this place will fall, and so will the House, and we will change this, and we will have the score then. We will have the score then, and ultimately your children will pay for the cost of this terrorism risk insurance, not the people who are owning the property today, not the insurance company. We will just kick the can down the road, just as we have on everything else.

It would seem to me that we would want to do something that works along

the parameters of this bill, and we ought to build in flexibility to this bill so that--it may be 10 years that we get on one of these because the bill is divided up to meet the score so it does not score in any one period. So over an 18-month period we could have to recoup it all and people could not tolerate those kinds of rate increases in their businesses or their homes. They would not be able to tolerate it and we would change it. Just as I am asking for us to change it now and be honest with the American people, we are going to change it if that happens.

We will change this, and we will delay the onset of the collection of this recoupment. Everybody knows that will happen. So why not be honest about it and put it in the bill now and waive the budget point of order because it does not change the deficit one penny. It changes when we collect it, but we still collect it against the risk of not collecting it at all.

That is what I ask my colleagues. I do not expect to win the amendment, but it is another confirmation to the American people that we are not about truth, we are not about doing commonsense things; we are about playing games and we are about satisfying the demands of the industry over which this applies.

Nobody knows what could happen in this country in terms of terrorism, but everybody knows I am right about this issue.

All I am saying is: Fess up. Be honest, colleagues. Let's build the flexibility in this so we do not have to address it, and the Treasury Secretary, no matter whether it is a Democrat or Republican administration, can use common sense to guide about how fast this recoupment will come; otherwise, you have not done anything to improve this bill if, in fact, this is not accepted.

I will be leaving here at the end of the year. Hopefully, we never see another terrorism event in this country. But if we do, it will be a sweet irony when you all say: Oops, time out. We are not going to do what we said we were going to do in that bill because the country cannot take it. What you will do is put one tragic event on top of another. You will not do that. So what will happen? You will change this bill. You will get that score. You will call it an emergency. You will do it anyway.

All I am asking is, be honest about what is going to ultimately happen on this should we have an event and it fall within one of these close parameters, based on what we said in the bill, because we are running the bill according to what CBO says, not as to what common sense is.

I look forward to having a vote on this amendment. I understand my likelihood of being successful. But I also understand the lack of honesty in dealing with the American people if we do not accept this amendment.

I yield the floor.

Terrorist Attacks

I call up amendment No. 3552, ask for its immediate consideration, and I ask that Senator Klobuchar and Senator Pryor be added as cosponsors.

I thank Chairman Johnson and Ranking Member Crapo and Senators Schumer and Heller for their hard work on helping me on the TRIA bill and for helping me on this amendment, as well as Senator Schumer and Senator Heller for their hard work not only on the TRIA legislation but also on the NARAB amendment, which I am going to talk about in a moment. I also wish to give a special thank-you to Senator Johanns, who is a cosponsor on this amendment and somebody with whom I have worked very closely to get this amendment to the point it is today.

The Tester-Johanns amendment is the National Association of Registered Agents and Brokers Act, otherwise known as NARAB. NARAB is a bill Senator Johanns and I introduced last year. It was reported out of the Banking, Housing, and Urban Affairs Committee on a voice vote.

Our amendment creates a nonprofit association to provide one-stop licensing for insurance agents and brokers operating outside of their home State. This arrangement would fully preserve the authority of State insurance regulators to supervise these markets.

Currently, an insurance agent or broker seeking to operate in multiple States must meet different State-specific licensing requirements and seek approval from each State's insurance commissioner. This process is time consuming, it is costly, it is redundant, and it is sometimes contradictory--without providing any greater consumer protection. That is a big disincentive for smaller agents and brokers to grow their businesses.

This is not a new issue for the insurance industry. Congress recognized the need for a forum to reform the insurance licensing system in 1999 when it incorporated the National Association of Registered Agents and Brokers Act subtitle into the Gramm-Leach-Bliley Act. Unfortunately, at that time Congress did not immediately establish NARAB. As a result, Gramm-Leach-Bliley did not achieve the level of reciprocity and uniformity Congress expected and these efforts to streamline cross-state insurance licensing never took hold. That is why this important amendment is before the Senate today.

Senator Johanns' and my amendment would provide insurance agents and brokers with the option of becoming a member of NARAB provided that they meet the professional standards set by the association and undergo a criminal background check.

NARAB will streamline the licensing process for agents and brokers, enabling them to be licensed under one single, strong national licensing standard rather than following different State standards, thereby saving time and money.

In addition to setting rigorous professional standards, the association will let agents and brokers renew their licenses all at once and fully preserve the abilities of regulators to protect consumers and supervise and discipline agents and brokers.

Currently, on average, insurance agents sell their products in eight States, with many serving even more. A one-stop licensing compliance mechanism will benefit all agents and brokers but particularly the smaller folks who must spend time and money dealing with different standards in different States.

A one-stop shop for insurance licensing will help smaller players compete against the bigger competitors. That is good for business, and it is good for consumers.

NARAB represents a decade of effort, and I am pleased we will finally achieve the goals laid out in Gramm-Leach-Bliley. Some feared NARAB would diminish States rights. As a former State legislator, when folks start talking about States rights issues, I pay attention, but in this case I believe they are wrong.

I wish to take a minute and talk about how this amendment protects States rights. Under this amendment, States would retain all authority to license their own resident agents and brokers. The association would be required to notify States when agents and brokers apply for membership, letting the States notify NARAB of any reason membership should not be granted to the producer.

States will also have significant control over NARAB. The nonprofit association would be governed by a board of directors dominated by State insurance regulators and chaired by a State insurance regulator. Most importantly, NARAB deals only with marketplace entry and would not impact the day-to-day regulation of insurance. States will maintain exclusive control of the regulation of marketplace activities, consumer protection requirements, unfair trade practices, and other important areas.

Under this bill, under this amendment, we will preserve the authority of States to supervise insurance producers. Any agent or broker who obtains the authority to operate in a jurisdiction through NARAB is still subject to the full regulatory authority of that State and must comply with all marketplace requirements. Under our amendment, States will continue to receive insurance licensing fees, which will be collected by NARAB and remitted to the States.

This legislation is supported by the National Association of Insurance and Financial Advisers, the Council of Insurance Agents and Brokers, and the Independent Insurance Agents and Brokers of America. It is also supported by the National Association of Insurance Commissioners, which has expressed its full support for this bill and the final TRIA bill.

I urge my colleagues to support the Tester-Johanns amendment. It is truly a commonsense amendment that helps not only the industry but also the consumers.

I yield the floor.