SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Empowering Teaching and Learning
Through Education Portals Act''.

SEC. 2. DEFINITIONS.

    In this Act:
            (1) 21st century skills.--The term ``21st century
        skills''--
                    (A) means skills that students need to succeed in
                school, work, and life; and
                    (B) includes--
                            (i) skills related either to core academic
                        subjects or to 21st century themes;
                            (ii) learning and innovation skills, such
                        as--
                                    (I) creativity and innovation;
                                    (II) critical thinking and problem
                                solving; or
                                    (III) communication and
                                collaboration; and
                            (iii) life and career skills to prepare
                        students for the global economy, such as--
                                    (I) flexibility and adaptability;
                                    (II) productivity and
                                accountability; or
                                    (III) leadership and
                                responsibility.
            (2) Core academic subjects; educational agencies; schools;
        state.--The terms ``core academic subjects'', ``elementary
        school'', ``local educational agency'', ``secondary school'',
        ``State'', and ``State educational agency'' have the meanings
        given the terms in section 9101 of the Elementary and Secondary
        Education Act of 1965 (20 U.S.C. 7801).
            (3) Covered educator.--The term ``covered educator'' means
        a teacher, administrator, or other professional staff member,
        at a covered school.
            (4) Covered parent.--The term ``covered parent'' means the
        parent of a covered student.
            (5) Covered school.--The term ``covered school'' means a
        Head Start agency operating a Head Start program, or a public
        school that is a preschool, elementary school, secondary
        school, or institution of higher education (including such an
        institution offering a program leading to a baccalaureate
        degree or a program leading to an advanced degree).
            (6) Covered student.--The term ``covered student'' means a
        student at a covered school.
            (7) Covered teacher.--The term ``covered teacher'' means a
        teacher at a covered school.
            (8) Education technology.--The term ``education
        technology'' means any technology resource that improves the
        learning, training, and engagement of students or helps
        teachers learn, improve their knowledge, and practice.
            (9) Institution of higher education.--The term
        ``institution of higher education'' has the meaning given the
        term in sections 101 and 102 of the Higher Education Act of
        1965 (20 U.S.C. 1001, 1002).
            (10) Professional development.--The term ``professional
        development'' means a resource or training that increases a
        teacher's skills, content knowledge, or other information that
        has a positive impact on student learning.
            (11) Secretary.--The term ``Secretary'' means the Secretary
        of Education.

SEC. 3. GRANTS.

    (a) In General.--The Secretary may award grants to eligible States,
to pay for the Federal share of the cost of implementing and
maintaining education portal initiatives.
    (b) Amounts.--The Secretary may award the grants for periods of not
less than 1 year and not more than 3 years.
    (c) Federal Share.--
            (1) In general.--The Federal share of the cost described in
        subsection (a) shall be 50 percent.
            (2) Non-federal share.--The State may provide the non-
        Federal share of the cost in cash or in kind, fairly evaluated,
        including plant, equipment, or services. The State may provide
        the non-Federal share from State, local, or private sources.

SEC. 4. APPLICATIONS AND AWARDS.

    (a) In General.--To be eligible to receive a grant under this
section for an initiative, a State shall submit an application to the
Secretary at such time, in such manner, and containing such information
as the Secretary may require.
    (b) Contents.--The application shall contain, at a minimum--
            (1) a comprehensive plan for the initiative for which the
        State seeks the grant, including evidence that the initiative
        meets the requirements of subsections (a) and (c) of section 5;
            (2) information describing how the State will provide the
        non-Federal share of the cost described in section 3(a), and
        will continue to provide that share during the implementation
        of the initiative and the remainder of the grant period;
            (3) information describing how the State will meet the
        maintenance of effort requirements in section 6;
            (4) information explaining the protocol the State will use
        to ensure safe and legal access to the education portal;
            (5) an assurance that the State has established or will
        establish an advisory panel, to provide advice on the
        implementation and maintenance of the initiative, including
        representatives of leaders in school districts, leaders at
        institutions of higher education, State educational agencies,
        parents, and teachers; and
            (6) a plan to ensure sufficient statewide bandwidth
        capacity and systems access to implement and maintain the State
        education portal.
    (c) Awards.--In determining the amounts of grants under this Act,
the Secretary--
            (1) shall take into consideration the extent to which a
        State has developed and implemented an education portal
        initiative prior to the date of the submission of the
        application involved; but
            (2) shall not penalize States that have made greater
        progress in developing and implementing such initiatives.

SEC. 5. USE OF FUNDS.

    (a) Required Uses.--A State that receives a grant under this Act
for a fiscal year shall use the funds made available through the grant
to implement or maintain an education portal initiative that includes--
            (1) collecting and making available--
                    (A) high quality resources (including data, tools,
                and digital media content) for covered educators,
                covered students, and covered parents, that support
                teaching, leading, and learning, and are, as
                appropriate, aligned with State education standards;
                and
                    (B) information for covered teachers to use in
                assisting covered students to attain skills such as
                21st century skills; and
            (2) collecting resources for ongoing and sustainable
        professional development for covered educators, related to the
        use of education technology, and making the resources available
        through the implementation of research-based methods and
        strategies for teacher coaching, collaborating, or mentoring.
    (b) Allowable Uses.--The State may use the funds made available
through the grant for such an initiative, for a portal that--
            (1) gives covered educators access to formative assessment
        and other resources to address various student learning styles,
        needs, and achievement levels;
            (2) provides an entry point to other information or
        services, including information on model examples of effective
        classroom practices, subscriptions or data systems, content
        standards, lesson plans, courses of study, engaging interactive
        media, Web resources, e-mail list management software, online
        portfolios, after-school program resources, and other
        educational resources;
            (3) provides access to technology-based curriculum
        resources and tools that promote the teaching and learning of
        21st century skills;
            (4) enables covered educators to quickly search for lesson
        plans, professional development resources, model examples of
        effective classroom practices, or other resources, by content
        standard, grade level, or topic;
            (5) provides an online support network or community for
        covered educators to collaborate on and discuss teaching,
        learning, curricula, and experiences, and serves as a
        communication tool between covered educators and covered
        parents;
            (6) includes digital media content developed by a
        television public broadcasting entity in coordination with the
        grant recipient; or
            (7) makes available access to 1 or more resource sections
        of the education portal, subject to the protocol described in
        section 4(b)(4), by covered education, covered students, and
        covered parents, from other States (with no requirement for
        State-specific log-ins), so that those covered educators,
        covered students, and covered parents can benefit from
        resources developed in the State, thereby expanding access to
        the national learning community.
    (c) Provision of and Access to Resources.--The covered educators,
covered students, and covered parents in the State may provide
resources and information for the education portal, subject to the
protocol described in section 4(b)(4). The resources and information in
the education portal shall be accessible statewide by the educators,
students, and parents, subject to the protocol.
    (d) Other Federal Funds.--A State that receives a grant under part
A of title II of the Elementary and Secondary Education Act of 1965 (20
U.S.C. 6601 et seq.) may use funds made available through that grant to
maintain (but not implement) the State's education portal initiative
under this Act, after the end of the period in which the State receives
funding under this Act.
    (e) Conforming Amendment.--Section 2113(a) of the Elementary and
Secondary Education Act of 1965 (20 U.S.C. 6613(a)) is amended by
striking ``A'' and inserting ``Subject to section 5 of the Empowering
Teaching and Learning Through Education Portals Act, a''.

SEC. 6. MAINTENANCE OF EFFORT.

    (a) In General.--A State that receives a grant under this Act for a
fiscal year shall maintain the expenditures of the State for education
portal initiatives at a level not less than the level of such
expenditures of the State for the fiscal year preceding the first
fiscal year for which the State received such a grant.
    (b) Reduction.--If the Secretary determines that a State, during a
fiscal year, expends less than the sum required to comply with
subsection (a), the Secretary shall--
            (1) determine the difference between the required sum and
        the expenditure; and
            (2) reduce the State's grant under this Act for the
        following year by the amount of the difference.

SEC. 7. EVALUATIONS AND CONFERENCE.

    (a) Federal Evaluation.--The Secretary shall conduct an evaluation
of each initiative funded under this Act. The Secretary shall submit a
report containing the results of the evaluation to Congress.
    (b) Federal Conference.--Not less often than once every 2 years,
the Secretary shall hold a conference for advisory panels described in
section 4(b)(5), to share information on best practices relating to
education portal initiatives.
    (c) State Evaluations.--Each State that receives a grant under this
Act shall conduct an evaluation of the initiative funded under the
grant, using funds provided as part of the non-Federal share of the
costs described in section 3(a). The State shall prepare and submit to
the Secretary a report containing the results of the evaluation.

SEC. 8. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated to carry out this Act
$100,000,000 for each of fiscal years 2009 through 2012, and such sums
as may be necessary for each of the following 2 fiscal years.

SEC. 9. SPECIAL RULES RELATING TO CORPORATE CHARITABLE CONTRIBUTIONS TO
              EDUCATION PORTAL PROJECTS OF ELIGIBLE STATES.

    (a) In General.--Paragraph (2) of Section 170(b) of the Internal
Revenue Code of 1986 (related to percentage limitations) is amended by
redesignating subparagraphs (C) and (D), respectively, and by inserting
after subparagraph (A) the following new subparagraph:
                    ``(B) Special rule for corporate contributions to
                education portal projects of eligible states.--
                            ``(i) In general.--In the case of qualified
                        education portal project contributions--
                                    ``(I) subparagraph (A) shall be
                                applied separately with respect to such
                                contributions and with respect to other
                                charitable contributions of the
                                taxpayer, and
                                    ``(II) in applying subparagraph (A)
                                to such qualified education portal
                                project contributions, subparagraph (A)
                                shall be applied by substituting `50
                                percent' for `10 percent'.
                            ``(ii) Qualified education portal project
                        contribution.--For purposes of this paragraph,
                        the term `qualified education portal project
                        contribution' means a charitable contribution
                        in cash--
                                    ``(I) to a State (as defined in
                                section 2 of the Empowering Teaching
                                and Learning Through Education Portals
                                Act) which has a grant application
                                approved under section 4 of such Act,
                                and
                                    ``(II) for the purpose of paying
                                the non-Federal share of the cost of
                                implementing and maintaining education
                                portal initiatives (within the meaning
                                of section 3 of such Act).''.
    (b) Effective Date.--The amendments made by this section shall
apply to contributions made after the date of the enactment of this
Act.

Summary: Empowering Teaching and Learning Through Education Portals Act - Authorizes the Secretary of Education to award matching grants to states to implement or maintain education portal initiatives that include collecting and making available: (1) high quality resources for teachers, students, and parents, that support public education from Head Start through graduate school. And (2) resources for ongoing and sustainable teacher training in the use of education technology at such educational levels. Allows teachers, students, and parents to contribute resources to their state portal, which is to be accessible statewide. Permits states to use funds available to them under part A of title II of the Elementary and Secondary Education Act of 1965 to maintain such initiatives after their receipt of this Act's funding ends. Requires the Secretary to hold a conference, at least biennially, for state advisory panels on education portal initiatives to share information on best practices. Amends the Internal Revenue Code to: (1) count corporate contributions to such initiatives separately from other corporate contributions in applying charitable contribution deductibility limits. And (2) allow corporate deductions for contributions to such initiatives to reach 50 of a corporation's taxable income.

A bill to make grants to States to implement statewide portal initiatives, and for other purposes.


SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair Wage Act''.

SEC. 2. MINIMUM WAGE INCREASES.

    (a) Minimum Wage.--
            (1) In general.--Section 6(a)(1) of the Fair Labor
        Standards Act of 1938 (29 U.S.C. 206(a)(1)) is amended to read
        as follows:
            ``(1) except as otherwise provided in this section, not
        less than--
                    ``(A) $8.00 an hour, beginning 30 days after the
                date of enactment of the Fair Wage Act or January 1,
                2017, whichever date is earlier;
                    ``(B) $9.00 an hour, beginning 1 year after the
                date the wage specified in subparagraph (A) takes
                effect;
                    ``(C) $10.00 an hour, beginning 2 years after such
                date;
                    ``(D) $11.00 an hour, beginning 3 years after such
                date;
                    ``(E) $12.00 an hour, beginning 4 years after such
                date;
                    ``(F) $13.00 an hour, beginning 5 years after such
                date;
                    ``(G) $14.00 an hour, beginning 6 years after such
                date;
                    ``(H) $15.00 an hour, beginning 7 years after such
                date; and
                    ``(I) beginning 8 years after such date, and
                annually thereafter, the amount determined by the
                Secretary pursuant to subsection (h).''.
            (2) Determination based in increase in consumer price
        index.--Section 6 of the Fair Labor Standards Act of 1938 (29
        U.S.C. 206) is amended by adding at the end the following:
    ``(h)(1) Each year, by not later than the date that is 90 days
before a new minimum wage determined under subsection (a)(1)(I) is to
take effect, the Secretary shall determine the minimum wage to be in
effect pursuant to this subsection for the subsequent 1-year period.
The wage determined pursuant to this subsection for a year shall be--
            ``(A) not less than the amount in effect under subsection
        (a)(1) on the date of such determination;
            ``(B) increased from such amount by the annual percentage
        increase in the Consumer Price Index for Urban Wage Earners and
        Clerical Workers (United States city average, all items, not
        seasonally adjusted), or its successor publication, as
        determined by the Bureau of Labor Statistics; and
            ``(C) rounded to the nearest multiple of $0.05.
    ``(2) In calculating the annual percentage increase in the Consumer
Price Index for purposes of paragraph (1)(B), the Secretary shall
compare such Consumer Price Index for the most recent month, quarter,
or year available (as selected by the Secretary prior to the first year
for which a minimum wage is in effect pursuant to this subsection) with
the Consumer Price Index for the same month in the preceding year, the
same quarter in the preceding year, or the preceding year,
respectively.''.
    (b) Publication of Notice.--Section 6 of the Fair Labor Standards
Act of 1938 (as amended by subsection (a)) (29 U.S.C. 206) is further
amended by adding at the end the following:
    ``(i) Not later than 60 days prior to the effective date of any
increase in the minimum wage determined under subsection (h), the
Secretary shall publish in the Federal Register and on the website of
the Department of Labor a notice announcing the adjusted required
wage.''.

SEC. 3. CREDIT AGAINST EMPLOYMENT TAXES OF CERTAIN EMPLOYERS WHO PAY
              MORE THAN THE FEDERAL MINIMUM WAGE.

    (a) In General.--Subchapter B of chapter 21 of the Internal Revenue
Code of 1986 is amended by adding at the end the following new section:

``SEC. 3113. CREDIT FOR CERTAIN EMPLOYERS WHO PAY MORE THAN THE FEDERAL
              MINIMUM WAGE.

    ``(a) In General.--In the case of a qualified employer, there shall
be allowed as a credit against the tax imposed under section 3111 an
amount equal to 6.2 percent of the wages paid by such employer to
qualified employees during the calendar year.
    ``(b) Qualified Employer.--For purposes of this section, the term
`qualified employer' means any employer for any calendar year if the
lowest hourly wage paid by such employer to the lowest paid employee of
such employer (determined on an hourly basis) exceeds the minimum
hourly wage in effect for such calendar year under section 6(a)(1) of
the Fair Labor Standards Act of 1938 by $1 or more per hour.
    ``(c) Qualified Employee.--For purposes of this section, the term
`qualified employee' means any employee of a qualified employer if--
            ``(1) such employee is compensated in wages on an hourly
        basis, and
            ``(2) such hourly wage is--
                    ``(A) not less than $1 more per hour than the
                minimum hourly wage in effect under section 6(a)(1) of
                the Fair Labor Standards Act of 1938,
                    ``(B) not more than $15 per hour, and
                    ``(C) in the case of any employee employed by such
                employer in any preceding calendar year, greater than
                the highest hourly wage paid by such employer to such
                employee during any such preceding calendar year.
    ``(d) Special Rules.--Wages shall be taken into account in
determining the amount of the credit allowed under subsection (a) only
if such wages are paid by the employer--
            ``(1) with respect to employment (as defined in section
        3121(b)), and
            ``(2) in the ordinary course of the employer's trade or
        business.''.
    (b) Trust Funds Held Harmless.--The amount of any transfer,
appropriation, or credit to any trust fund shall be determined without
regard to the amendment made by subsection (a).
    (c) Effective Date.--The amendment made by subsection (a) shall
apply to wages paid after the date that is 30 days after the date of
enactment of this Act or January 1, 2017, whichever date is earlier.

Summary: Fair Wage Act This bill amends the Fair Labor Standards Act of 1938 to increase the federal minimum wage for employees to: $8.00 an hour 30 days after this Act's enactment date or January 1, 2017, whichever date is earlier. $9.00 an hour, one year after the date the $8.00 an hour wage takes effect, $10.00 an hour, after two years, $11.00 an hour, after three years, $12.00 an hour, after four years, $13.00 an hour, after five years, $14.00 an hour, after six years, $15.00 an hour, after seven years. And the amount determined by the Department of Labor eight years after such date and annually thereafter. The bill directs Labor, 60 days before any increase in the minimum wage, to publish it in the Federal Register and on Labor's website. The bill amends the Internal Revenue Code to allow an employer who pays at least $1 more per hour than the federal minimum wage, but not more than $15 per hour, a credit against the employment tax equal to 6.2 of wages paid by such employer during the calendar year.

Fair Wage Act


SECTION 1. SHORT TITLES.

    This Act may be cited as the ``Stop Illegal Reentry Act'' or as
``Kate's Law''.

SEC. 2. INCREASED PENALTIES FOR REENTRY OF REMOVED ALIEN.

    Section 276 of the Immigration and Nationality Act (8 U.S.C. 1326)
is amended--
            (1) by redesignating subsections (c) and (d) as subsections
        (d) and (e), respectively;
            (2) by striking subsections (a) and (b) and inserting the
        following:
    ``(a) In General.--Subject to subsections (b) and (c), any alien
who--
            ``(1) has been denied admission, excluded, deported, or
        removed or has departed the United States while an order of
        exclusion, deportation, or removal is outstanding; and
            ``(2) thereafter enters, attempts to enter, or is at any
        time found in, the United States, unless--
                    ``(A) prior to the alien's reembarkation at a place
                outside the United States or the alien's application
                for admission from foreign contiguous territory, the
                Secretary of Homeland Security has expressly consented
                to such alien's reapplying for admission; or
                    ``(B) with respect to an alien previously denied
                admission and removed, such alien shall establish that
                the alien was not required to obtain such advance
                consent under this Act or any prior Act;
        shall be fined under title 18, United States Code, or
        imprisoned not more than five years, or both.
    ``(b) Criminal Penalties for Reentry of Certain Removed Aliens.--
            ``(1) In general.--Notwithstanding the penalty provided in
        subsection (a), and except as provided in subsection (c), an
        alien described in subsection (a)--
                    ``(A) who was convicted before such removal or
                departure of three or more misdemeanors involving
                drugs, crimes against the person, or both, or a felony
                (other than an aggravated felony), shall be fined under
                title 18, United States Code, imprisoned not more than
                10 years, or both;
                    ``(B) who has been excluded from the United States
                pursuant to section 235(c) because the alien was
                excludable under section 212(a)(3)(B) or who has been
                removed from the United States pursuant to the
                provisions of title V, and who thereafter, without the
                permission of the Secretary of Homeland Security,
                enters the United States, or attempts to do so, shall
                be fined under title 18, United States Code, and
                imprisoned for a period of 10 years, which sentence
                shall not run concurrently with any other sentence;
                    ``(C) who was removed from the United States
                pursuant to section 241(a)(4)(B) who thereafter,
                without the permission of the Secretary of Homeland
                Security, enters, attempts to enter, or is at any time
                found in, the United States (unless the Secretary of
                Homeland Security has expressly consented to such
                alien's reentry) shall be fined under title 18, United
                States Code, imprisoned for not more than 10 years, or
                both; and
                    ``(D) who has been denied admission, excluded,
                deported, or removed 3 or more times and thereafter
                enters, attempts to enter, crosses the border to,
                attempts to cross the border to, or is at any time
                found in the United States, shall be fined under title
                18, United States Code, imprisoned not more than 10
                years, or both.
            ``(2) Removal defined.--In this subsection and subsection
        (c), the term `removal' includes any agreement in which an
        alien stipulates to removal during (or not during) a criminal
        trial under either Federal or State law.
    ``(c) Mandatory Minimum Criminal Penalty for Reentry of Certain
Removed Aliens.--Notwithstanding the penalties provided in subsections
(a) and (b), an alien described in subsection (a)--
            ``(1) who was convicted before such removal or departure of
        an aggravated felony; or
            ``(2) who was convicted at least two times before such
        removal or departure of illegal reentry under this section;
shall be imprisoned not less than five years and not more than 20
years, and may, in addition, be fined under title 18, United States
Code.''; and
            (3) in subsection (d), as redesignated by paragraph (1)--
                    (A) by striking ``section 242(h)(2)'' and inserting
                ``section 241(a)(4)''; and
                    (B) by striking ``Attorney General'' and inserting
                ``Secretary of Homeland Security''.

Summary: Stop Illegal Reentry Act or Kate's Law This bill amends the Immigration and Nationality Act to increase from two years to five years the maximum prison term for an alien who reenters after being denied admission, excluded, deported, or removed. It establishes: a 10-year maximum prison term for an alien who reenters after being denied admission, excluded, deported, or removed on 3 or more prior occasions. And a 5-year mandatory minimum prison term for an alien who reenters after being removed following a conviction for an aggravated felony or following 2 or more prior convictions for illegal reentry.

Kate's Law


SECTION 1. RURAL AND MOUNTAINOUS ADVISORY COUNCIL.

    (a) Establishment.--Subject to the availability of appropriations,
not later than 6 months after the date of enactment of this Act, the
Secretary of Transportation shall establish in the National Highway
Traffic Safety Administration a Rural and Mountainous Advisory Council
(hereinafter referred to as the ``Council'').
    (b) Membership.--Members of the Council shall include a diverse
group representative of business, academia and independent researchers,
State and local authorities, safety and consumer advocates, engineers,
labor organizations, environmental experts, a representative of the
National Highway Traffic Safety Administration, and other members
determined to be appropriate by the Secretary. The Council shall be
composed of not less than 15 and not more than 30 members appointed by
the Secretary.
    (c) Terms.--Members of the Council shall be appointed by the
Secretary of Transportation and shall serve for a term of three years.
    (d) Vacancies.--Any vacancy occurring in the membership of the
Council shall be filled in the same manner as the original appointment
for the position being vacated. The vacancy shall not affect the power
of the remaining members to execute the duties of the Council.
    (e) Duties.--The Council shall undertake information gathering
activities, develop technical advice, and present best practices or
recommendations to the Secretary regarding the testing and deployment
of highly automated vehicles and automated driving systems in areas
that are rural, remote, mountainous, insular, or unmapped to evaluate
operational limitations caused by natural geographical or man-made
features, or adverse weather conditions, and to enhance the safety and
reliability of highly automated vehicles and automated driving systems
used in such areas with such features or conditions.
    (f) Report to Congress.--The recommendations of the Council shall
also be reported to the Committee on Energy and Commerce of the House
of Representatives and the Committee on Commerce, Science, and
Transportation of the Senate.
    (g) Federal Advisory Committee Act.--The establishment and
operation of the Council shall conform to the requirements of the
Federal Advisory Committee Act (5 U.S.C. App.).
    (h) Technical Assistance.--On request of the Council, the Secretary
shall provide such technical assistance to the Council as the Secretary
determines to be necessary to carry out the Council's duties.
    (i) Detail of Federal Employees.--On the request of the Council,
the Secretary may detail, with or without reimbursement, any of the
personnel of the Department of Transportation to the Council to assist
the Council in carrying out its duties. Any detail shall not interrupt
or otherwise affect the civil service status or privileges of the
Federal employee.
    (j) Payment and Expenses.--Members of the Council shall serve
without pay, except travel and per diem will be paid each member for
meetings called by the Secretary.
    (k) Termination.--The Council shall terminate 6 years after the
date of enactment of this Act.
    (l) Definitions.--
            (1) In general.--In this section--
                    (A) the term ``automated driving system'' means the
                hardware and software that are collectively capable of
                performing the entire dynamic driving task on a
                sustained basis, regardless of whether such system is
                limited to a specific operational design domain;
                    (B) the term ``dynamic driving task'' means all of
                the real time operational and tactical functions
                required to operate a vehicle in on-road traffic,
                excluding the strategic functions such as trip
                scheduling and selection of destinations and waypoints,
                and including--
                            (i) lateral vehicle motion control via
                        steering;
                            (ii) longitudinal vehicle motion control
                        via acceleration and deceleration;
                            (iii) monitoring the driving environment
                        via object and event detection, recognition,
                        classification, and response preparation;
                            (iv) object and event response execution;
                            (v) maneuver planning; and
                            (vi) enhancing conspicuity via lighting,
                        signaling, and gesturing;
                    (C) the term ``highly automated vehicle''--
                            (i) means a motor vehicle equipped with an
                        automated driving system; and
                            (ii) does not include a commercial motor
                        vehicle (as defined in section 31101 of title
                        49, United States Code); and
                    (D) the term ``operational design domain'' means
                the specific conditions under which a given driving
                automation system or feature thereof is designed to
                function.
            (2) Revisions to certain definitions.--
                    (A) If SAE International (or its successor
                organization) revises the definition of any of the
                terms defined in subparagraph (A), (B), or (D) of
                paragraph (1) in Recommended Practice Report J3016, it
                shall notify the Secretary of the revision. The
                Secretary shall publish a notice in the Federal
                Register to inform the public of the new definition
                unless, within 90 days after receiving notice of the
                new definition and after opening a period for public
                comment on the new definition, the Secretary notifies
                SAE International (or its successor organization) that
                the Secretary has determined that the new definition
                does not meet the need for motor vehicle safety, or is
                otherwise inconsistent with the purposes of chapter 301
                of title 49, United States Code. If the Secretary so
                notifies SAE International (or its successor
                organization), the existing definition in paragraph (1)
                shall remain in effect.
                    (B) If the Secretary does not reject a definition
                revised by SAE International (or its successor
                organization) as described in subparagraph (A), the
                Secretary shall promptly make any conforming amendments
                to the regulations and standards of the Secretary that
                are necessary. The revised definition shall apply for
                purposes of this section. The requirements of section
                553 of title 5, United States Code, shall not apply to
                the making of any such conforming amendments.
                    (C) Pursuant to section 553 of title 5, United
                States Code, the Secretary may update any of the
                definitions in subparagraph (A), (B), or (D) of
                paragraph (1) if the Secretary determines that
                materially changed circumstances regarding highly
                automated vehicles have impacted motor vehicle safety
                such that the definitions need to be updated to reflect
                such circumstances.

Summary: This bill directs the Department of Transportation (DOT) to establish in the National Highway Traffic Safety Administration a Rural and Mountainous Advisory Council. The council shall undertake information gathering activities, develop technical advice, and present best practices or recommendations to DOT regarding the testing and deployment of highly automated vehicles and automated driving systems in rural, remote, mountainous, insular, or unmapped areas to evaluate operational limitations caused by natural geographical or man-made features or adverse weather conditions and to enhance the safety and reliability of such vehicles and systems in such areas or conditions. A quot, highly automated vehiclequot. Is defined as a motor vehicle equipped with an automated driving system. An automated driving system is defined as the hardware and software that are collectively capable of performing the entire dynamic driving task on a sustained basis, regardless of whether such system is limited to a specific operational design domain.

To establish in the National Highway Traffic Safety Administration a Rural and Mountainous Advisory Council to make recommendations regarding the testing and deployment of highly automated vehicles and automated driving systems in areas that are rural, remote, mountainous, insular, or unmapped.


SECTION 1. FINDINGS.

    The Congress makes the following findings:
            (1) It has been reported that at an internal Central
        Communist Party meeting in 1994, Chinese President Jiang Zemin
        asserted that religion is one of the biggest threats to
        Communist Party rule in China.
            (2) On January 31, 1994, Premier Li Ping signed decrees
        number 144 and 145 which restrict worship, religious education,
        distribution of bibles and other religious literature, and
        contact with foreign coreligionists.
            (3) The Chinese Government has created organizations that
        have as their purpose controlling all religious worship,
        activity, and association in China and supplanting the Roman
        Catholic Church, independent Protestant churches and
        independent Buddhist, Taoist, and Islamic associations.
            (4) In July 1995 Ye Xiaowen, a reputed atheist and rigid
        communist, was appointed to head the Bureau of Religious
        Affairs, an agency controlled by the United Front Work
        Department of the Chinese Government, that has administrative
        control over all religious worship and activity in China
        through an official system of registering or denying rights and
        privileges to religious congregations and leaders.
            (5) In the past year, the Chinese Government has expressed
        great concern over the spread of Christianity and particularly
        over the rapid growth of Christian religious institutions other
        than those controlled by the government, including the Roman
        Catholic Church and the evangelical Christian ``house
        churches''.
            (6) Soon after the establishment of the People's Republic
        of China in 1949, the Chinese Government imprisoned Christians
        who refused to relinquish their faith to become servants of
        Communism, charging them as ``counter-revolutionaries'' and
        sentencing them to 20 years or more in labor camps.
            (7) Hundreds of Chinese Protestants and Catholics are among
        those now imprisoned at ``reeducation through labor'' camps
        because of their religious beliefs.
            (8) The reeducation camps are run by the Ministry of Public
        Security and the Ministry of Justice of the Chinese Government.
            (9) The Chinese Communist Government refuses to permit the
        appointment by the Vatican of Catholic Bishops and ordination
        of priests for China and insists on appointing its own
        ``Catholic bishops''.
            (10) The Tenth Panchen Lama died in January 1989 at Tashi
        Lhunpo Monastery, his traditional spiritual seat in Shigatze,
        Tibet's second largest city.
            (11) The Dalai Lama has the right to recognize the
        successor to the Panchen Lama, and has always done so.
            (12) On May 14, 1995, His Holiness the Dalai Lama announced
        recognition of a 6-year-old boy, Gedhun Choekyi Nyima, as the
        Eleventh Panchen Lama, according to Tibetan tradition.
            (13) The young boy recognized by the Dalai Lama and his
        family have been brought to Beijing by Chinese authorities and
        have not been seen in several months.
            (14) Chatrel Rimpoche, abbot of Tashi Lhunpo Monastery and
        head of the original search committee for the Eleventh Panchen
        Lama, and his assistant, Champa Chung, are believed to have
        been seized and detained by Chinese authorities in May of 1995.
            (15) Chinese Government authorities subsequently detained
        other Tibetan Buddhists in connection with selection of the
        Eleventh Panchen Lama, including Gyatrol Rimpoche, Shepa
        Kelsang, Lhakpa Tsering, and Ringkar Ngawang.
            (16) The Chinese Government convened a conference in
        Beijing of Tibetan Lamas who were forcibly brought to Beijing
        in order to select a rival candidate to the child selected by
the Dalai Lama as the Eleventh Panchen Lama.
            (17) On November 29, 1995, Luo Gan, Secretary General of
        the State Council, and Ye Xiaowen, Director of the Bureau of
        Religious Affairs, orchestrated an elaborate ceremony
        designating a 6-year-old boy selected by the Chinese Government
        as the Eleventh Panchen Lama.
            (18) On December 8, 1995, State Councilor Li Tieying
        presided over a ceremony in Shigatze, Tibet, in which the boy
        selected by the Chinese Government as the Eleventh Panchen Lama
        was enthroned.
            (19) By seeking to impose its own candidate as the Eleventh
        Panchen Lama and detaining the 6-year-old boy recognized for
        that position in accordance with Tibetan tradition, the Chinese
        Government is inserting itself into a purely Tibetan religious
        matter, in blatant violation of the fundamental human rights of
        the Tibetan people.

SEC. 2. STATEMENT OF POLICY.

    The Department of State should make the release of individuals
imprisoned or detained on religious grounds a major objective of United
States foreign policy with respect to China, and should raise this
issue in every relevant bilateral and multilateral forum.

SEC. 3. PROHIBITION ON FUNDING BY AGENCIES OF THE UNITED STATES FOR THE
              PARTICIPATION OF CERTAIN CHINESE OFFICIALS IN
              INTERNATIONAL PROGRAMS AND ACTIVITIES.

    (a) Restriction.--No funds available to the Department of State,
the United States Information Agency, the Agency for International
Development, or any other agency or entity of the United States
Government may be obligated or expended for the participation of any of
the following individuals in any conference, exchange program, or
activity relating to education, culture, training, or any other
purpose, until the President submits the certification described in
subsection (b):
            (1) The head of any of the following Chinese Government-
        created and approved organizations:
                    (A) The Chinese Buddhist Association.
                    (B) The Chinese Catholic Patriotic Association.
                    (C) The Chinese Catholic Religious Affairs
                Committee.
                    (D) The Chinese Catholic Bishops' Conference.
                    (E) The Chinese Protestant ``Three-Self'' Patriotic
                Movement.
                    (F) The China Christian Council.
                    (G) The Chinese Taoist Association.
                    (H) The Chinese Islamic Association.
            (2) Any official or employee of the United Front Work
        Department of the Chinese Government.
            (3) Luo Gan, the Secretary General of the State Council, Li
        Tieying, State Councilor, and any other official or employee of
        the State Council.
            (4) Ye Xiaowen, Director of Bureau of Religious Affairs,
        and any other official or employee of the Bureau of Religious
        Affairs of the Chinese Government.
            (5) Any military or civilian official or employee of the
        Ministry of Public Security or the Ministry of Justice of the
        Chinese Government.
    (b) Certification.--The certification referred to in subsection (a)
is a certification by the President to the Congress that the following
individuals have been released, unconditionally, by the Chinese
Government:
            (1) Pei Zhongxun (whose Korean name is Chun Chul).
            (2) Dai Guillang.
            (3) Dai Lanmei.
            (4) Geng Minuan.
            (5) Wang Xincai.
            (6) Li Tianen.
            (7) Guo Mengshan.
            (8) Jiang Huaifeng.
            (9) Xu Funian.
            (10) Wang Yao Hua.
            (11) Chen Zhuman.
            (12) Bishop Zeng Jingmu.
            (13) Father Li Jian Jin.
            (14) Father Vincent Qin Guoliang.
            (15) Pan Kunming.
            (16) Rao Yangping.
            (17) Yu Qixing.
            (18) Yu Shuishen.
            (19) Li Qingming.
            (20) Zhang Zhiqiang.
            (21) Gedhun Choekyi Nyima and his family.
            (22) Chatrel Rimpoche.
            (23) Champa Chung.
            (24) Gyatrol Rimpoche.
            (25) Shepa Kelsang.
            (26) Lhakpa Tsering.
            (27) Ringkar Ngawang.

Summary: Urges the Department of State to make the release of Chinese imprisoned or detained on religious grounds a major objective of US foreign policy with China. Prohibits the Department of State, the US Information Agency, the Agency for International Development, or any other Federal agency or entity from obligating or expending funds for the participation of certain Chinese individuals and organizations in any conference, exchange program, or activity relating to education, culture, training, or any other purpose, until the President certifies to the Congress that specified imprisoned or detained Chinese citizens have been unconditionally released by the Chinese Government.

To prohibit funding by United States Government agencies of the participation of certain officials of the Chinese Government in international conferences, programs, and activities until the Chinese Government releases certain individuals imprisoned or detained on religious grounds.


SECTION 1. GRATUITOUS TRANSFERS FOR THE BENEFIT OF EMPLOYEES.

    (a) In General.--Subparagraph (C) of section 664(d)(1) of the
Internal Revenue Code of 1986 and subparagraph (C) of section 664(d)(2)
of such Code are each amended by striking the period at the end thereof
and inserting ``or, to the extent the remainder interest is in
qualified employer securities (as defined in paragraph (3)(C)), is to
be transferred to an employee stock ownership plan (as defined in
section 4975(e)(7)) in a qualified gratuitous transfer (as defined by
paragraph (3)).''
    (b) Qualified Gratuitous Transfer Defined.--Subsection (d) of
section 664 of such Code is amended by redesignating paragraph (3) as
paragraph (4) and by inserting after paragraph (2) the following new
paragraph:
            ``(3) Qualified gratuitous transfer of qualified employer
        securities.--
                    ``(A) In general.--For purposes of this section,
                the term `qualified gratuitous transfer' means a
                transfer of qualified employer securities to an
                employee stock ownership plan (as defined in section
                4975(e)(7)) but only to the extent that--
                            ``(i) the securities transferred previously
                        passed from a decedent to a trust described in
                        paragraph (1) or (2);
                            ``(ii) no deduction under section 404 is
                        allowable with respect to such transfer;
                            ``(iii) such plan provides that the
                        securities so transferred are allocated to plan
                        participants in a manner consistent with
                        section 401(a)(4);
                            ``(iv) such plan treats such securities as
                        being attributable to employer contributions
                        but without regard to the limitations otherwise
                        applicable to such contributions under section
                        404;
                            ``(v) such plan provides that such
                        securities are held in a suspense account under
                        the plan to be allocated each year, up to the
                        limitations under section 415(c), after first
                        allocating all other annual additions for the
                        limitation year, up to the limitations under
                        sections 415 (c) and (e); and
                            ``(vi) the employer whose employees are
                        covered by the plan described in this
                        subparagraph files with the Secretary a
                        verified written statement consenting to the
                        application of sections 4978 and 4979A with
                        respect to such employer.
                    ``(B) Qualified employer securities.--For purposes
                of this section, the term `qualified employer
                securities' means employer securities (as defined in
                section 409(l)) which are issued by a domestic
                corporation which has no outstanding stock which is
                readily tradable on an established securities market.
                    ``(C) Treatment of securities allocated by employee
                stock ownership plan to persons related to decedent or
                5-percent shareholders.--
                            ``(i) In general.--If any portion of the
                        assets of the plan attributable to securities
                        acquired by the plan in a qualified gratuitous
                        transfer are allocated to the account of--
                                    ``(I) any person who is related to
                                the decedent (within the meaning of
                                section 267(b)), or
                                    ``(II) any person who, at the time
                                of such allocation or at any time
                                during the 1-year period ending on the
                                date of the acquisition of qualified
                                employer securities by the plan, is a
                                5-percent shareholder of the employer
                                maintaining the plan,
                        the plan shall be treated as having distributed
                        (at the time of such allocation) to such person
                        or shareholder the amount so allocated.
                            ``(ii) 5-percent shareholder.--For purposes
                        of clause (i), the term `5-percent shareholder'
                        means any person who owns (directly or through
                        the application of section 318(a)) more than 5
                        percent of--
                                    ``(I) any class of outstanding
                                stock of the corporation which issued
                                such qualified employer securities or
                                of any corporation which is a member of
                                the same controlled group of
                                corporations (within the meaning of
                                section 409(l)(4)) as such corporation,
                                or
                                    ``(II) the total value of any class
                                of outstanding stock of any such
                                corporation; and
                        For purposes of the preceding sentence, section
                        318(a) shall be applied without regard to the
                        exception in paragraph (2)(B)(i) thereof.
                            ``(iii) Cross reference.--

                                ``For excise tax on allocations
described in clause (i), see section 4979A.''
    (c) Conforming Amendments.--
            (1) Section 401(a)(1) of such Code is amended by inserting
        ``or by a charitable remainder trust pursuant to a qualified
        gratuitous transfer (as defined in section 664(d)(3)(A)),''
        after ``stock bonus plans),''.
            (2) Section 404(a)(9) of such Code is amended by inserting
        after subparagraph (B) the following new subparagraph:
                    ``(C) A qualified gratuitous transfer (as defined
                in section 664(d)(3)(A)) shall have no effect on the
                amount or amounts otherwise deductible under paragraph
                (3) or (7) or under this paragraph.''
            (3) Section 415(c)(6) of such Code is amended by adding at
        the end thereof the following new sentence:
        ``The amount of any qualified gratuitous transfer (as defined
        in section 664(d)(3)(A)) allocated to a participant for any
        limitation year shall not exceed the limitations imposed by
        this section, but such amount shall not be taken into account
        in determining whether any other amount exceeds the limitations
        imposed by this section.''
            (4) Section 415(e) of such Code is amended--
                    (A) by redesignating paragraph (6) as paragraph
                (7), and
                    (B) by inserting after paragraph (5) the following
                new paragraph:
            ``(6) Special rule for qualified gratuitous transfers.--Any
        qualified gratuitous transfer of qualified employer securities
        (as defined by section 664(d)(3)) shall not be taken into
        account in calculating, and shall not be subject to, the
        limitations provided in this subsection.''
            (5) Paragraph (3) of section 644(e) of such Code is amended
        to read as follows:
            ``(3) acquired by a charitable remainder annuity trust (as
        defined in section 664(d)(1)) or a charitable remainder
        unitrust (as defined in sections 664(d) (2) and (4)), or''.
            (6) Subparagraph (B) of section 664(d)(1) of such Code and
        subparagraph (B) of section 664(d)(2) of such Code are each
        amended by inserting ``and other than qualified gratuitous
        transfers described in subparagraph (C)'' after ``subparagraph
        (A)''.
            (7) Paragraph (4) of section 674(b) of such Code is amended
        by inserting before the period ``or to an employee stock
        ownership plan (as defined in section 4975(e)(7)) in a
        qualified gratuitous transfer (as defined in section
        664(d)(3))''.
            (8)(A) Section 2055(a) of such Code is amended--
                    (i) by striking ``or'' at the end of paragraph (3),
                    (ii) by striking the period at the end of paragraph
                (4) and inserting ``; or'', and
                    (iii) by inserting after paragraph (4) the
                following new paragraph:
            ``(5) to an employee stock ownership plan if such transfer
        qualifies as a qualified gratuitous transfer of qualified
        employer securities within the meaning of section 664(d)(3).''
            (B) Clause (ii) of section 2055(e)(3)(C) of such Code is
        amended by striking ``section 664(d)(3)'' and inserting
        ``section 664(d)(4)''.
            (9) Paragraph (8) of section 2056(b) of such Code is
        amended to read as follows:
            ``(8) Special rule for charitable remainder trusts.--
                    ``(A) In general.--If the surviving spouse of the
                decedent is the only beneficiary of a qualified
                charitable remainder trust who is not a charitable
                beneficiary nor an ESOP beneficiary, paragraph (1)
                shall not apply to any interest in such trust which
                passes or has passed from the decedent to such
                surviving spouse.
                    ``(B) Definitions.--For purposes of subparagraph
                (A)--
                            ``(i) Charitable beneficiary.--The term
                        `charitable beneficiary' means any beneficiary
                        which is an organization described in section
                        170(c).
                            ``(ii) Esop beneficiary.--The term `ESOP
                        beneficiary' means any beneficiary which is an
                        employee stock ownership plan (as defined in
                        section 4975(e)(7)) that holds a remainder
                        interest in qualified employer securities (as
                        defined in section 664(d)(3)) to be transferred
                        to such plan in a qualified gratuitous transfer
                        (as defined in section 664(d)(3)).
                            ``(iii) Qualified charitable remainder
                        trust.--The term `qualified charitable
                        remainder trust' means a charitable remainder
                        annuity trust or a charitable remainder
                        unitrust (described in section 664).''
            (10) Section 4947(b) of such Code is amended by inserting
        after paragraph (3) the following new paragraph:
            ``(4) Section 507.--The provisions of section 507(a) shall
        not apply to a trust which is described in subsection (a)(2) by
        reason of a distribution of qualified employer securities (as
        defined in section 664(d)(3)) to an employee stock ownership
        plan (as defined in section 4975(e)(7)) in a qualified
        gratuitous transfer (as defined by section 664(d)(3)).''
            (11) The last sentence of section 4975(e)(7) of such Code
        is amended by inserting ``and section 664(d)(3)'' after
        ``section 409(n)''
            (12) Subsection (a) of section 4978 of such Code is amended
        by inserting ``or acquired any qualified employer securities in
        a qualified gratuitous transfer to which section 664(d)(3)
        applied'' after ``section 1042 applied''.
            (13) Paragraph (2) of section 4978(b) of such Code is
        amended--
                    (A) by inserting ``or acquired in the qualified
                gratuitous transfer to which section 664(d)(3)
                applied'' after ``section 1042 applied'', and
                    (B) by inserting ``or to which section 664(d)(3)
                applied'' after ``section 1042 applied'' in
                subparagraph (C) thereof.
            (14) Subsection (c) of section 4978 of such Code is amended
        by striking ``written statement'' and all that follows and
        inserting ``written statement described in section
        664(d)(3)(A)(vi) or in section 1042(b)(3) (as the case may
        be).''
            (15) Paragraph (2) of section 4978(e) of such Code is
        amended by striking the period and inserting ``; except that
        such section shall be applied without regard to subparagraph
        (B) thereof for purposes of applying this section and section
        4979A with respect to securities acquired in a qualified
        gratuitous transfer (as defined in section 664(d)(3)(A)).''
            (16) Subsection (a) of section 4979A of such Code is
        amended to read as follows:
    ``(a) Imposition of Tax.--If--
            ``(1) there is a prohibited allocation of qualified
        securities by any employee stock ownership plan or eligible
        worker-owned cooperative, or
            ``(2) there is an allocation described in section
        663(d)(3)(C)(i),
there is hereby imposed a tax on such allocation equal to 50 percent of
the amount involved.''
            (17) Subsection (c) of section 4979A of such Code is
        amended to read as follows:
    ``(c) Liability for Tax.--The tax imposed by this section shall be
paid by--
            ``(1) the employer sponsoring such plan, or
            ``(2) the eligible worker-owned cooperative,
which made the written statement described in section 664(d)(3)(A)(vi)
or in section 1042(b)(3)(B) (as the case may be).''
            (18) Section 4979A of such Code is amended by redesignating
        subsection (d) as subsection (e) and by inserting after
        subsection (c) the following new subsection:
    ``(d) Special Statute of Limitations for Tax Attributable to
Certain Allocations.--The statutory period for the assessment of any
tax imposed by this section on an allocation described in subsection
(a)(2) of qualified employer securities shall not expire before the
date which is 3 years from the later of--
            ``(1) the 1st allocation of such securities in connection
        with a qualified gratuitous transfer (as defined in section
        664(d)(3)(A)), or
            ``(2) the date on which the Secretary is notified of the
        allocation described in subsection (a)(2).''
    (d) Effective Date.--The amendments made by this section shall
apply to transfers made by trusts to, or for the use of, an employee
stock ownership plan after the date of the enactment of this Act.

Summary: Amends the Internal Revenue Code regarding estates and trusts to provide rules for the gratuitous transfer of qualified employer securities to an employee stock ownership plan from charitable remainder trusts.

To amend the Internal Revenue Code of 1986 to provide special rules for certain gratuitous transfers of employer securities for the benefit of employees.


SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Estate Tax Repeal Acceleration
(ExTRA) for Family-Owned Businesses and Farms Act''.

SEC. 2. REPEAL OF ESTATE TAX ON FAMILY-OWNED BUSINESSES AND FARMS.

    (a) Carryover Business Interest Exclusion.--Part IV of subchapter A
of chapter 11 of the Internal Revenue Code of 1986 (relating to taxable
estate) is amended by inserting after section 2058 the following new
section:

``SEC. 2059. CARRYOVER BUSINESS INTERESTS.

    ``(a) General Rules.--
            ``(1) Allowance of deduction.--For purposes of the tax
        imposed by section 2001, in the case of an estate of a decedent
        to which this section applies, the value of the taxable estate
        shall be determined by deducting from the value of the gross
        estate the adjusted value of the carryover business interests
        of the decedent which are described in subsection (b)(2).
            ``(2) Application of carryover basis rules.--With respect
        to the adjusted value of the carryover business interests of
        the decedent which are described in subsection (b)(2), the
        rules of section 1023 shall apply.
    ``(b) Estates to Which Section Applies.--
            ``(1) In general.--This section shall apply to an estate
        if--
                    ``(A) the decedent was (at the date of the
                decedent's death) a citizen or resident of the United
                States,
                    ``(B) the executor elects the application of this
                section under rules similar to the rules of paragraphs
                (1) and (3) of section 2032A(d) and files the agreement
                referred to in subsection (e), and
                    ``(C) during the 8-year period ending on the date
                of the decedent's death there have been periods
                aggregating 5 years or more during which--
                            ``(i) the carryover business interests
                        described in paragraph (2) were owned by the
                        decedent or a member of the decedent's family,
                        and
                            ``(ii) there was material participation
                        (within the meaning of section 2032A(e)(6)) by
                        the decedent, a member of the decedent's
                        family, or a qualified heir in the operation of
                        the business to which such interests relate.
            ``(2) Includible carryover business interests.--The
        carryover business interests described in this paragraph are
        the interests which--
                    ``(A) are included in determining the value of the
                gross estate,
                    ``(B) are acquired by any qualified heir from, or
                passed to any qualified heir from, the decedent (within
                the meaning of section 2032A(e)(9)), and
                    ``(C) are subject to the election under paragraph
                (1)(B).
            ``(3) Rules regarding material participation.--For purposes
        of paragraph (1)(C)(ii)--
                    ``(A) in the case a surviving spouse, material
                participation by such spouse may be satisfied under
                rules similar to the rules under section 2032A(b)(5),
                    ``(B) in the case of a carryover business interest
                in an entity carrying on multiple trades or businesses,
                material participation in each trade or business is
                satisfied by material participation in the entity or in
                1 or more of the multiple trades or businesses, and
                    ``(C) in the case of a lending and finance business
                (as defined in section 6166(b)(10)(B)(ii)), material
                participation is satisfied under the rules under
                subclause (I) or (II) of section 6166(b)(10)(B)(i).
    ``(c) Adjusted Value of the Carryover Business Interests.--For
purposes of this section--
            ``(1) In general.--The adjusted value of any carryover
        business interest is the value of such interest for purposes of
        this chapter (determined without regard to this section), as
        adjusted under paragraph (2).
            ``(2) Adjustment for previous transfers.--The Secretary may
        increase the value of any carryover business interest by that
        portion of those assets transferred from such carryover
        business interest to the decedent's taxable estate within 3
        years before the date of the decedent's death.
    ``(d) Carryover Business Interest.--
            ``(1) In general.--For purposes of this section, the term
        `carryover business interest' means--
                    ``(A) an interest as a proprietor in a trade or
                business carried on as a proprietorship, or
                    ``(B) an interest in an entity carrying on a trade
                or business, if--
                            ``(i) at least--
                                    ``(I) 50 percent of such entity is
                                owned (directly or indirectly) by the
                                decedent and members of the decedent's
                                family,
                                    ``(II) 70 percent of such entity is
                                so owned by members of 2 families, or
                                    ``(III) 90 percent of such entity
                                is so owned by members of 3 families,
                                and
                            ``(ii) for purposes of subclause (II) or
                        (III) of clause (i), at least 30 percent of
                        such entity is so owned by the decedent and
                        members of the decedent's family.
        For purposes of the preceding sentence, a decedent shall be
        treated as engaged in a trade or business if any member of the
        decedent's family is engaged in such trade or business.
            ``(2) Lending and finance business.--For purposes of this
        section, any asset used in a lending and finance business (as
        defined in section 6166(b)(10)(B)(ii)) shall be treated as an
        asset which is used in carrying on a trade or business.
            ``(3) Limitation.--Such term shall not include--
                    ``(A) any interest in a trade or business the
                principal place of business of which is not located in
                the United States,
                    ``(B) any interest in an entity, if the stock or
                debt of such entity or a controlled group (as defined
                in section 267(f)(1)) of which such entity was a member
                was readily tradable on an established securities
                market or secondary market (as defined by the
                Secretary) at any time,
                    ``(C) that portion of an interest in an entity
                transferred by gift to such interest within 3 years
                before the date of the decedent's death, and
                    ``(D) that portion of an interest in an entity
                which is attributable to cash or marketable securities,
                or both, in any amount in excess of the reasonably
                anticipated business needs of such entity.
        In any proceeding before the United States Tax Court involving
        a notice of deficiency based in whole or in part on the
        allegation that cash or marketable securities, or both, are
        accumulated in an amount in excess of the reasonably
        anticipated business needs of such entity, the burden of proof
        with respect to such allegation shall be on the Secretary to
        the extent such cash or marketable securities are less than 35
        percent of the value of the interest in such entity.
            ``(4) Rules regarding ownership.--
                    ``(A) Ownership of entities.--For purposes of
                paragraph (1)(B)--
                            ``(i) Corporations.--Ownership of a
                        corporation shall be determined by the holding
                        of stock possessing the appropriate percentage
                        of the total combined voting power of all
                        classes of stock entitled to vote and the
                        appropriate percentage of the total value of
                        shares of all classes of stock.
                            ``(ii) Partnerships.--Ownership of a
                        partnership shall be determined by the owning
                        of the appropriate percentage of the capital
                        interest in such partnership.
                    ``(B) Ownership of tiered entities.--For purposes
                of this section, if by reason of holding an interest in
                a trade or business, a decedent, any member of the
                decedent's family, any qualified heir, or any member of
                any qualified heir's family is treated as holding an
                interest in any other trade or business--
                            ``(i) such ownership interest in the other
                        trade or business shall be disregarded in
                        determining if the ownership interest in the
                        first trade or business is a carryover business
                        interest, and
                            ``(ii) this section shall be applied
                        separately in determining if such interest in
                        any other trade or business is a carryover
                        business interest.
                    ``(C) Individual ownership rules.--For purposes of
                this section, an interest owned, directly or
                indirectly, by or for an entity described in paragraph
                (1)(B) shall be considered as being owned
                proportionately by or for the entity's shareholders,
                partners, or beneficiaries. A person shall be treated
                as a beneficiary of any trust only if such person has a
                present interest in such trust.
    ``(e) Agreement.--The agreement referred to in this subsection is a
written agreement signed by each person in being who has an interest
(whether or not in possession) in any property designated in such
agreement consenting to the application of this section with respect to
such property.
    ``(f) Other Definitions and Applicable Rules.--For purposes of this
section--
            ``(1) Qualified heir.--The term `qualified heir' means a
        United States citizen who is--
                    ``(A) described in section 2032A(e)(1), or
                    ``(B) an active employee of the trade or business
                to which the carryover business interest relates if
                such employee has been employed by such trade or
                business for a period of at least 10 years before the
                date of the decedent's death.
            ``(2) Member of the family.--The term `member of the
        family' has the meaning given to such term by section
        2032A(e)(2).
            ``(3) Applicable rules.--Rules similar to the following
        rules shall apply:
                    ``(A) Section 2032A(b)(4) (relating to decedents
                who are retired or disabled).
                    ``(B) Section 2032A(e)(10) (relating to community
                property).
                    ``(C) Section 2032A(e)(14) (relating to treatment
                of replacement property acquired in section 1031 or
                1033 transactions).
                    ``(D) Section 2032A(g) (relating to application to
                interests in partnerships, corporations, and trusts).
            ``(4) Safe harbor for active entities held by entity
        carrying on a trade or business.--For purposes of this section,
        if--
                    ``(A) an entity carrying on a trade or business
                owns 20 percent or more in value of the voting
                interests of another entity, or such other entity has
                15 or fewer owners, and
                    ``(B) 80 percent or more of the value of the assets
                of each such entity is attributable to assets used in
                an active business operation, then the requirements
                under subsections (b)(1)(C)(ii) and (d)(3)(D) shall be
                met with respect to an interest in such an entity.''.
    (b) Carryover Basis Rules for Carryover Business Interests.--Part
II of subchapter O of chapter 1 of the Internal Revenue Code of 1986
(relating to basis rules of general application) is amended by
inserting after section 1022 the following new section:

``SEC. 1023. TREATMENT OF CARRYOVER BUSINESS INTERESTS.

    ``(a) In General.--Except as otherwise provided in this section--
            ``(1) qualified property acquired from a decedent shall be
        treated for purposes of this subtitle as transferred by gift,
        and
            ``(2) the basis of the person acquiring qualified property
        from such a decedent shall be the lesser of--
                    ``(A) the adjusted basis of the decedent, or
                    ``(B) the fair market value of the property at the
                date of the decedent's death.
    ``(b) Qualified Property.--For purposes of this section, the term
`qualified property' means the carryover business interests of the
decedent with respect to which an election is made under section
2059(b)(1)(B).
    ``(c) Property Acquired From the Decedent.--For purposes of this
section, the following property shall be considered to have been
acquired from the decedent:
            ``(1) Property acquired by bequest, devise, or inheritance,
        or by the decedent's estate from the decedent.
            ``(2) Property transferred by the decedent during his
        lifetime--
                    ``(A) to a qualified revocable trust (as defined in
                section 645(b)(1)), or
                    ``(B) to any other trust with respect to which the
                decedent reserved the right to make any change in the
                enjoyment thereof through the exercise of a power to
                alter, amend, or terminate the trust.
            ``(3) Any other property passing from the decedent by
        reason of death to the extent that such property passed without
        consideration.
    ``(d) Coordination With Section 691.--This section shall not apply
to property which constitutes a right to receive an item of income in
respect of a decedent under section 691.
    ``(e) Certain Liabilities Disregarded.--
            ``(1) In general.--In determining whether gain is
        recognized on the acquisition of property--
                    ``(A) from a decedent by a decedent's estate or any
                beneficiary other than a tax-exempt beneficiary, and
                    ``(B) from the decedent's estate by any beneficiary
                other than a tax-exempt beneficiary, and in determining
                the adjusted basis of such property, liabilities in
                excess of basis shall be disregarded.
            ``(2) Tax-exempt beneficiary.--For purposes of paragraph
        (1), the term `tax-exempt beneficiary' means--
                    ``(A) the United States, any State or political
                subdivision thereof, any possession of the United
                States, any Indian tribal government (within the
                meaning of section 7871), or any agency or
                instrumentality of any of the foregoing,
                    ``(B) an organization (other than a cooperative
                described in section 521) which is exempt from tax
                imposed by chapter 1,
                    ``(C) any foreign person or entity (within the
                meaning of section 168(h)(2)), and
                    ``(D) to the extent provided in regulations, any
                person to whom property is transferred for the
                principal purpose of tax avoidance.
    ``(f) Regulations.--The Secretary shall prescribe such regulations
as may be necessary to carry out the purposes of this section.''.
    (c) Clerical Amendments.--
            (1) The table of sections for part IV of subchapter A of
        chapter 11 of the Internal Revenue Code of 1986 is amended by
        inserting after the item relating to section 2058 the following
        new item:

``Sec. 2059. Carryover business exclusion.''.
            (2) The table of sections for part II of subchapter O of
        chapter 1 of such Code is amended by inserting after the item
        relating to section 1022 the following new item:

``Sec. 1023. Treatment of carryover business interests.''.
    (d) Effective Dates.--The amendments made by this section shall
apply to estates of decedents dying, and gifts made--
            (1) after the date of the enactment of this Act, and before
        January 1, 2010, and
            (2) after December 31, 2010.

Summary: Estate Tax Repeal Acceleration (ExTRA) for Family-Owned Businesses and Farms Act - Amends the Internal Revenue Code to revise the estate tax exclusion provisions applicable to family-owned business interests. Allows an exclusion from the gross estate for the adjusted value of certain family business interests acquired from a decedent . Defines carryover business interests and revises ownership requirements and material participation rules applicable to such interests. Provides that carryover business interests acquired from a decedent shall be treated as transferred by gift and that the basis of such property shall be the lesser of the adjusted basis of the decedent, or the fair market value of such property at the date of the decedent's death .

A bill to amend the Internal Revenue Code of 1986 to provide for the immediate and permanent repeal of the estate tax on family-owned businesses and farms, and for other purposes.


SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Fair American Corporate Tax Act'' or
``FACT Act''.

SEC. 2. DECREASE IN TOP MARGINAL RATE.

    (a) In General.--Paragraph (1) of section 11(b) of the Internal
Revenue Code of 1986 is amended--
            (1) by inserting ``and'' at the end of subparagraph (B),
            (2) by striking subparagraphs (C) and (D) and inserting the
        following subparagraph:
                    ``(C) 28 percent of so much of the taxable income
                as exceeds $75,000.'',
            (3) by striking ``of $100,000'' and inserting ``of
        $75,000'',
            (4) by striking ``$11,750'' and inserting ``$7,250'', and
            (5) by striking the third sentence.
    (b) Certain Personal Service Corporations.--Paragraph (2) of
section 11(b) of such Code is amended by striking ``35 percent'' and
inserting ``28 percent''.
    (c) Conforming Amendments.--
            (1) Subsection (a) of section 1201 of such Code is amended
        by striking ``35 percent'' each place it appears and inserting
        ``28 percent''.
            (2) Paragraphs (1), (2), and (6) of section 1445(e) of such
        Code are each amended by striking ``35 percent'' and inserting
        ``28 percent''.
    (d) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 2010.

SEC. 3. LIMITATION ON TREATY BENEFITS FOR CERTAIN DEDUCTIBLE PAYMENTS.

    (a) In General.--Section 894 of the Internal Revenue Code of 1986
(relating to income affected by treaty) is amended by adding at the end
the following new subsection:
    ``(d) Limitation on Treaty Benefits for Certain Deductible
Payments.--
            ``(1) In general.--In the case of any deductible related-
        party payment, the amount of any withholding tax imposed under
        chapter 3 (and any tax imposed under subpart A or B of this
        part) with respect to such payment shall not be less than the
        amount which would be imposed if the payment were made directly
        to the foreign parent corporation (taking into account any
        income tax treaty between the United States and the country in
        which the foreign parent corporation is resident).
            ``(2) Deductible related-party payment.--For purposes of
        this subsection, the term `deductible related-party payment'
        means any payment made, directly or indirectly, by any person
        to any other person if the payment is allowable as a deduction
        under this chapter and both persons are members of the same
        foreign controlled group of entities.
            ``(3) Foreign controlled group of entities.--For purposes
        of this subsection--
                    ``(A) In general.--The term `foreign controlled
                group of entities' means a controlled group of entities
                the common parent of which is a foreign corporation.
                    ``(B) Controlled group of entities.--The term
                `controlled group of entities' means a controlled group
                of corporations as defined in section 1563(a)(1),
                except that--
                            ``(i) `more than 50 percent' shall be
                        substituted for `at least 80 percent' each
                        place it appears therein, and
                            ``(ii) the determination shall be made
                        without regard to subsections (a)(4) and (b)(2)
                        of section 1563.
                A partnership or any other entity (other than a
                corporation) shall be treated as a member of a
                controlled group of entities if such entity is
                controlled (within the meaning of section 954(d)(3)) by
                members of such group (including any entity treated as
                a member of such group by reason of this sentence).
            ``(4) Foreign parent corporation.--For purposes of this
        subsection, the term `foreign parent corporation' means, with
        respect to any deductible related-party payment, the common
        parent of the foreign controlled group of entities referred to
        in paragraph (3)(A).
            ``(5) Regulations.--The Secretary may prescribe such
        regulations or other guidance as are necessary or appropriate
        to carry out the purposes of this subsection, including
        regulations or other guidance which provide for--
                    ``(A) the treatment of two or more persons as
                members of a foreign controlled group of entities if
                such persons would be the common parent of such group
                if treated as one corporation, and
                    ``(B) the treatment of any member of a foreign
                controlled group of entities as the common parent of
                such group if such treatment is appropriate taking into
                account the economic relationships among such
                entities.''.
    (b) Effective Date.--The amendment made by this section shall apply
to payments made after the date of the enactment of this Act.

Summary: Fair American Corporate Tax Act or FACT Act - Amends the Internal Revenue Code to: (1) decrease from 35 to 28 the top marginal income tax rate for corporations. And (2) provide that the amount of any tax withholding for deductible payments made by a US subsidiary of a foreign parent corporation to a related subsidiary in any country that has a tax treaty with the United States shall not be less than the amount which would be imposed if the payment were made directly to the foreign parent corporation.

To amend the Internal Revenue Code of 1986 to decrease the top marginal corporate rate to 28 percent and to prevent corporations from exploiting tax treaties to evade taxation of United States income.