To provide assistance to the unemployed, tax relief for average Americans, fiscal assistance to state and local governments, and jobs and security through infrastructure investment, and for other purposes.

January 28, 2003

Mr. DEFAZIO introduced the following bill; which was referred to the Committee on Ways and Means, and in addition to the Committees on Transportation and Infrastructure, Education and the Workforce, Energy and Commerce, Agriculture, Financial Services, and Armed Services, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

To provide assistance to the unemployed, tax relief for average Americans, fiscal assistance to state and local governments, and jobs and security through infrastructure investment, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

(a) SHORT TITLE- This Act may be cited as the `Emergency Anti-Recession Act of 2003'.

(b) TABLE OF CONTENTS-

Sec. 1. Short title.

TITLE I--ASSISTANCE TO THE UNEMPLOYED

Sec. 101. Entitlement to additional weeks of temporary extended unemployment compensation.

TITLE II--PAYROLL TAX RELIEF

Sec. 201. Payroll tax holiday.

TITLE III--FISCAL ASSISTANCE FOR STATE AND LOCAL GOVERNMENTS

Sec. 301. Findings.

Sec. 302. Financial assistance authorized.

Sec. 303. Allocation.

Sec. 304. Use of funds by State and local governments.

TITLE IV--TRANSPORTATION AND WATER INFRASTRUCTURE INVESTMENT

Subtitle A--Rail Infrastructure Investment

Part I--Credit for Amtrak Bonds

Sec. 401. Credit to holders of qualified Amtrak bonds.

Part II--High-speed Rail Provisions

Sec. 403. Department of transportation approval for qualified Amtrak projects.

Sec. 404. Multiyear capital spending plan and oversight.

Sec. 405. Issuance of regulations.

Sec. 406. Sense of Congress regarding effect on Amtrak funding.

Sec. 407. Effective date.

Part III--Amtrak Capital Investment

Sec. 411. Authorization of appropriations.

Part IV--Capital Investment for Railroad Rehabilitation

Sec. 416. Capital grants for railroad track.

Sec. 417. Regulatory procedure amendments.

Subtitle B--Environmental Infrastructure Investment

Sec. 421. General authority for capitalization grants.

Sec. 422. Capitalization grants agreements.

Sec. 423. Water pollution control revolving funds.

Sec. 424. Authorization of appropriations for clean water State revolving funds.

Sec. 425. Wet weather.

Sec. 426. Safe drinking water State revolving funds.

Subtitle C--Highway Infrastructure Investment

Sec. 431. Federal-aid highway program obligation ceiling.

Sec. 432. Limitations on credit amounts.

Subtitle D--Transit Infrastructure Investment

Sec. 441. Additional authorizations for formula grants.

Sec. 442. Federal transit program obligation ceiling.

Sec. 443. Uniform dollar limitation for all types of transportation fringe benefits.

Subtitle E--Aviation Infrastructure Investment

Sec. 451. Increased funding for airport planning and development.

Sec. 452. Increased funding for airway facilities improvement.

Subtitle F--Maritime Infrastructure Investment

Sec. 461. Marine transportation system infrastructure.

Subtitle G--Economic Development Infrastructure Investment

Sec. 471. Public works and economic development.

Sec. 472. Appalachian regional development.

Sec. 473. Delta regional development.

Subtitle H--Water Resources Infrastructure Investment

Sec. 481. Increased funding for corps of engineers projects.

Subtitle I--Public Buildings Infrastructure Investment

Sec. 491. Security enhancements for GSA properties.

Sec. 492. Security enhancements for John F. Kennedy center.

Sec. 493. Security enhancements for Smithsonian Institution.

Subtitle J--General Provisions

Sec. 495. Priority consideration for security projects.

Sec. 496. Temporary waiver of non-Federal share.

Sec. 497. Maintenance of effort.

Sec. 498. Labor standards.

Sec. 499. Buy America.

TITLE V--ELEMENTARY AND SECONDARY EDUCATION INFRASTRUCTURE

Sec. 501. Elementary and secondary education infrastructure.

Sec. 502. Labor standards.

TITLE VI--REVENUE OFFSETS

Sec. 601. Top individual income tax marginal rate not reduced below 2003 level.

Sec. 602. Reinstatement of estate tax for estate over $5,000,000; repeal of carryover basis.

TITLE I--ASSISTANCE TO THE UNEMPLOYED

SEC. 101. ENTITLEMENT TO ADDITIONAL WEEKS OF TEMPORARY EXTENDED UNEMPLOYMENT COMPENSATION.

(a) IN GENERAL- Paragraph (1) of section 203(b) of the Temporary Extended Unemployment Compensation Act of 2002 (26 U.S.C. 3304 note) is amended--

(1) in subparagraph (A), by striking `50' and inserting `100'; and

(2) in subparagraph (B), by striking `13' and inserting `26'.

(b) PROGRAM EXTENSION- Paragraph (3) of section 208(b) of such Act is amended by striking `August 30' and inserting `November 29'.

(c) CONFORMING AMENDMENT- Paragraph (1) of section 203(c) of such Act is amended by inserting `50 percent of' before `the amount originally established in such account'.

SEC. 102. EFFECTIVE DATE.

(a) IN GENERAL- The amendments made by this title--

(1) shall take effect as if included in the enactment of Public Law 107-147; but

(2) shall apply only with respect to weeks of unemployment beginning on or after the date of enactment this Act, subject to subsection (b).

(b) SPECIAL RULES- In the case of an individual for whom a temporary extended unemployment account was established before the date of enactment of this Act, the Temporary Extended Unemployment Compensation Act of 2002 (as amended by this title) shall be applied subject to the following:

(1) Any amounts deposited in the individual's temporary extended unemployment compensation account by reason of section 203(c) of such Act (commonly known as `TEUC-X amounts') before the date of enactment of this Act shall be treated as amounts deposited by reason of section 203(b) of such Act (commonly known as `TEUC amounts'), as amended by section 101(a).

(2) For purposes of determining whether the individual is eligible for any TEUC-X amounts under such Act, as amended by this title--

(A) any determination made under section 203(c) of such Act before the application of the amendments made by this title shall be disregarded; and

(B) any such determination shall instead be made by applying section 203(c) of such Act, as amended by this title--

(i) as of the time that all amounts established in such account in accordance with section 203(b) of such Act (as amended by this title, and including any amounts described in paragraph (1)) are in fact exhausted, except that

(ii) if such individual's account was both augmented by and exhausted of all TEUC-X amounts before the date of enactment of this Act, such determination shall be made as if exhaustion (as described in section 203(c)(1) of such Act) had not occurred until such date of enactment.

TITLE II--PAYROLL TAX RELIEF

SEC. 201. PAYROLL TAX HOLIDAY.

(a) IN GENERAL- Notwithstanding any other provision of law, the rate of tax with respect to the first $10,000 of remuneration received during the payroll tax holiday period shall be zero under sections 1401(a), 3101(a), and 3111(a) of the Internal Revenue Code of 1986 and for purposes of determining the applicable percentage under section 3201(a), 3211(a)(1), and 3221(a) of such Code.

(b) PAYROLL TAX HOLIDAY PERIOD- The term `payroll tax holiday period' means the 1-year period beginning on the 1st day of the 1st calendar month which begins more than 30 days after the date of the enactment of this Act.

(c) EMPLOYER NOTIFICATION- The Secretary of the Treasury shall notify employers of the payroll tax holiday period in any manner the Secretary deems appropriate.

(d) TRANSFER OF FUNDS- The Secretary of the Treasury shall transfer from the general revenues of the Federal Government an amount sufficient so as to ensure that the income and balances of the trust funds under section 201 of the Social Security Act and the Social Security Equivalent Benefit Account under section 15A of the Railroad Retirement Act of 1974 (45 U.S.C. 231n-1) are not reduced as a result of the application of subsection (a).

(e) DETERMINATION OF BENEFITS- In making any determination of benefits under title II of the Social Security Act, the Commissioner of Social Security shall disregard the effect of the payroll tax holiday period on any individual's earnings record.

TITLE III--FISCAL ASSISTANCE FOR STATE AND LOCAL GOVERNMENTS

SEC. 301. FINDINGS.

The Congress finds that:

(1) State and local governments represent a significant segment of the national economy whose economic health is essential to national economic prosperity;

(2) present national economic problems have imposed considerable hardships on State and local government budgets;

(3) those governments, because of their own fiscal difficulties, are being forced to take budget-related actions which tend to undermine Federal government efforts to stimulate the economy;

(4) efforts to stimulate the economy through reductions in Federal government tax obligations or increased spending on federal programs are weakened when State and local governments are forced to increase taxes or cut spending;

(5) efforts by the Federal government to stimulate the economic recovery will be substantially enhanced by a program of emergency Federal government assistance to State and local governments to help prevent those governments from taking budget-related actions which undermine the Federal government efforts to stimulate economic recovery.

SEC. 302. FINANCIAL ASSISTANCE AUTHORIZED.

(a) PAYMENTS TO STATE AND LOCAL GOVERNMENTS- The Secretary of the Treasury shall, in accordance with the provisions in this title, make payments to states to coordinate budget related actions by such governments with federal government efforts to stimulate economic recovery.

(b) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated $50,000,000,000 to be made available through fiscal year 2004 for the purpose of payments under this title.

(c) RESERVATIONS- Not less than one-third of the money authorized to be appropriated under section 302(b) shall be made available to local governments under the applicable laws of a given State.

SEC. 303. ALLOCATION.

The Secretary of the Treasury shall establish a formula for determining each State's allocation under section 302(b). The formula shall give priority weight to the following factors:

(1) The State unemployment rate in relation to the national average unemployment rate.

(2) The duration of a State unemployment rate above such average.

(3) Median income.

(4) Population.

SEC. 304. USE OF FUNDS BY STATE AND LOCAL GOVERNMENTS.

(a) IN GENERAL- Funds received under this title may be used only for priority expenditures. For purposes of this title, the term `priority expenditures' means only--

(1) ordinary and necessary maintenance and operating expenses for--

(A) primary, secondary, or higher education,

(B) worker retraining,

(C) public safety,

(D) public health,

(E) social services for the poor or aged,

(F) public transportation,

(G) environmental protection, and

(H) libraries; and

(2) ordinary and necessary capital expenditures authorized by law.

(b) CERTIFICATES BY STATE AND LOCAL GOVERNMENTS- The Secretary is authorized to accept a certification by the chief executive officer of a State or local government that the State or local government has used the funds received by it under this subtitle for an entitlement period only for priority expenditures, unless the Secretary determines that such certification is not sufficiently reliable to enable the Secretary to carry out his or her duties under this title. The Secretary shall prescribe by rule the time and manner in which the certification must be filed.

TITLE IV--TRANSPORTATION AND WATER INFRASTRUCTURE INVESTMENT

Subtitle A--Rail Infrastructure Investment

PART I--CREDIT FOR AMTRAK BONDS

SEC. 401. CREDIT TO HOLDERS OF QUALIFIED AMTRAK BONDS.

(a) IN GENERAL- Part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 (relating to credits against tax) is amended by adding at the end the following new subpart:

`Subpart H--Nonrefundable Credit for Holders of Qualified Amtrak Bonds

`Sec. 54. Credit to holders of qualified Amtrak bonds.

`SEC. 54. CREDIT TO HOLDERS OF QUALIFIED AMTRAK BONDS.

`(a) ALLOWANCE OF CREDIT- In the case of a taxpayer who holds a qualified Amtrak bond on a credit allowance date of such bond which occurs during the taxable year, there shall be allowed as a credit against the tax imposed by this chapter for such taxable year an amount equal to the sum of the credits determined under subsection (b) with respect to credit allowance dates during such year on which the taxpayer holds such bond.

`(b) AMOUNT OF CREDIT-

`(1) IN GENERAL- The amount of the credit determined under this subsection with respect to any credit allowance date for a qualified Amtrak bond is 25 percent of the annual credit determined with respect to such bond.

`(2) ANNUAL CREDIT- The annual credit determined with respect to any qualified Amtrak bond is the product of--

`(A) the applicable credit rate, multiplied by

`(B) the outstanding face amount of the bond.

`(3) APPLICABLE CREDIT RATE- For purposes of paragraph (2), the applicable credit rate with respect to an issue is the rate equal to an average market yield (as of the day before the date of sale of the issue) on outstanding long-term corporate debt obligations (determined under regulations prescribed by the Secretary).

`(4) CREDIT ALLOWANCE DATE- For purposes of this section, the term `credit allowance date' means--

`(A) March 15,

`(B) June 15,

`(C) September 15, and

`(D) December 15.

Such term includes the last day on which the bond is outstanding.

`(5) SPECIAL RULE FOR ISSUANCE AND REDEMPTION- In the case of a bond which is issued during the 3-month period ending on a credit allowance date, the amount of the credit determined under this subsection with respect to such credit allowance date shall be a ratable portion of the credit otherwise determined based on the portion of the 3-month period during which the bond is outstanding. A similar rule shall apply when the bond is redeemed.

`(c) LIMITATION BASED ON AMOUNT OF TAX-

`(1) IN GENERAL- The credit allowed under subsection (a) for any taxable year shall not exceed the excess of--

`(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over

`(B) the sum of the credits allowable under this part (other than this subpart and subpart C).

`(2) CARRYOVER OF UNUSED CREDIT- If the credit allowable under subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.

`(d) CREDIT INCLUDED IN GROSS INCOME- Gross income includes the amount of the credit allowed to the taxpayer under this section (determined without regard to subsection (c)) and the amount so included shall be treated as interest income.

`(e) QUALIFIED AMTRAK BOND- For purposes of this part, the term `qualified Amtrak bond' means any bond issued as part of an issue if--

`(1) 95 percent or more of the proceeds from the sale of such issue are to be used for expenditures

incurred after the date of the enactment of this section for any qualified project,

`(2) the bond is issued by the National Railroad Passenger Corporation, is in registered form, and meets the bond limitation requirements under subsection (f),

`(3) the issuer designates such bond for purposes of this section,

`(4) the issuer certifies that it meets the State contribution requirement of subsection (k) with respect to such project, as in effect on the date of the enactment of this section,

`(5) the issuer certifies that it has obtained the written approval of the Secretary of Transportation for such project in accordance with section 26301 of title 49, United States Code, as in effect on the date of the enactment of this section,

`(6) the term of each bond which is part of such issue does not exceed 20 years,

`(7) the payment of principal with respect to such bond is the obligation of the National Railroad Passenger Corporation, and

`(8) the issue meets the requirements of subsection (g) (relating to arbitrage).

`(f) LIMITATIONS ON AMOUNT OF BONDS DESIGNATED-

`(1) IN GENERAL- There is a qualified Amtrak bond limitation for each fiscal year. Such limitation is--

`(A) $1,500,000,000 for each of the fiscal years 2002 through 2011, and

`(B) zero after fiscal year 2011.

`(2) LIMITS ON BONDS FOR NORTHEAST RAIL CORRIDOR AND INDIVIDUAL STATES-

`(A) NORTHEAST RAIL CORRIDOR- Not more than $3,000,000,000 of the limitation under paragraph (1) may be designated for qualified projects on the northeast rail corridor between Washington, D.C., and Boston, Massachusetts.

`(B) INDIVIDUAL STATES- Not more than $3,000,000,000 of the limitation under paragraph (1) may be designated for any individual State. The dollar limitation under this subparagraph is in addition to the dollar limitation for the qualified projects described in subparagraph (A).

`(3) LIMIT ON BONDS FOR OTHER PROJECTS- Not more than $100,000,000 of the limitation under paragraph (1) for any fiscal year may be designated for all qualified projects described in subsection (j)(1)(C).

`(4) CARRYOVER OF UNUSED LIMITATION- If for any fiscal year--

`(A) the limitation amount under paragraph (1), exceeds

`(B) the amount of bonds issued during such year which are designated under subsection (e)(3),

the limitation amount under paragraph (1) for the following fiscal year (through fiscal year 2015) shall be increased by the amount of such excess.

`(g) SPECIAL RULES RELATING TO ARBITRAGE-

`(1) IN GENERAL- Subject to paragraph (2), an issue shall be treated as meeting the requirements of this subsection if as of the date of issuance, the issuer reasonably expects--

`(A) to spend at least 95 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 3-year period beginning on such date,

`(B) to incur a binding commitment with a third party to spend at least 10 percent of the proceeds from the sale of the issue, or to commence construction, with respect to such projects within the 6-month period beginning on such date, and

`(C) to proceed with due diligence to complete such projects and to spend the proceeds from the sale of the issue.

`(2) RULES REGARDING CONTINUING COMPLIANCE AFTER 3-YEAR DETERMINATION- If at least 95 percent of the proceeds from the sale of the issue is not expended for 1 or more qualified projects within the 3-year period beginning on the date of issuance, but the requirements of paragraph (1) are otherwise met, an issue shall be treated as continuing to meet the requirements of this subsection if either--

`(A) the issuer uses all unspent proceeds from the sale of the issue to redeem bonds of the issue within 90 days after the end of such 3-year period, or

`(B) the following requirements are met:

`(i) The issuer spends at least 75 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 3-year period beginning on the date of issuance.

`(ii) Either--

`(I) the issuer spends at least 95 percent of the proceeds from the sale of the issue for 1 or more qualified projects within the 4-year period beginning on the date of issuance, or

`(II) the issuer pays to the Federal Government any earnings on the proceeds from the sale of the issue that accrue after the end of the 3-year period beginning on the date of issuance and uses all unspent proceeds from the sale of the issue to redeem bonds of the issue within 90 days after the end of the 4-year period beginning on the date of issuance.

`(h) RECAPTURE OF PORTION OF CREDIT WHERE CESSATION OF COMPLIANCE-

`(1) IN GENERAL- If any bond which when issued purported to be a qualified Amtrak bond ceases to be such a qualified bond, the issuer shall pay to the United States (at the time required by the Secretary) an amount equal to the sum of--

`(A) the aggregate of the credits allowable under this section with respect to such bond (determined without regard to subsection (c)) for taxable years ending during the calendar year in which such cessation occurs and the 2 preceding calendar years, and

`(B) interest at the underpayment rate under section 6621 on the amount determined under subparagraph (A) for each calendar year for the period beginning on the first day of such calendar year.

`(2) FAILURE TO PAY- If the issuer fails to timely pay the amount required by paragraph (1) with respect to such bond, the tax imposed by this chapter on each holder of any such bond which is part of such issue shall be increased (for the taxable year of the holder in which such cessation occurs) by the aggregate decrease in the credits allowed under this section to such holder for taxable years beginning in such 3 calendar years which would have resulted solely from denying any credit under this section with respect to such issue for such taxable years.

`(3) SPECIAL RULES-

`(A) TAX BENEFIT RULE- The tax for the taxable year shall be increased under paragraph (2) only with respect to credits allowed by reason of this section which were used to reduce tax liability. In the case of credits not so used to reduce tax liability, the carryforwards and carrybacks under section 39 shall be appropriately adjusted.

`(B) NO CREDITS AGAINST TAX- Any increase in tax under paragraph (2) shall not be treated as a tax imposed by this chapter for purposes of determining--

`(i) the amount of any credit allowable under this part, or

`(ii) the amount of the tax imposed by section 55.

`(i) TRUST ACCOUNT-

`(1) IN GENERAL- The following amounts shall be held in a trust account by a trustee independent of the National Railroad Passenger Corporation:

`(A) The proceeds from the sale of all bonds designated for purposes of this section.

`(B) The amount of any matching contributions with respect to such bonds.

`(C) The temporary period investment earnings on proceeds from the sale of such bonds.

`(D) Any earnings on any amounts described in subparagraph (A), (B), or (C).

`(2) USE OF FUNDS- Amounts in the trust account may be used only to pay costs of qualified projects and redeem qualified Amtrak bonds, except that amounts withdrawn from the trust account to pay costs of qualified projects may not exceed the aggregate proceeds from the sale of all qualified Amtrak bonds issued under this section.

`(3) USE OF REMAINING FUNDS IN TRUST ACCOUNT- Upon the redemption of all qualified Amtrak bonds issued under this section, any remaining amounts in the trust account described in paragraph (1) shall be available to the issuer for any qualified project.

`(j) QUALIFIED PROJECT- For purposes of this section--

`(1) IN GENERAL- The term `qualified project' means--

`(A) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements (including the introduction of new high-speed technologies such as magnetic levitation systems), including track or signal improvements or the elimination of grade crossings, for the northeast rail corridor between Washington, D.C., and Boston, Massachusetts,

`(B) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements (including the introduction of new high-speed technologies such as magnetic levitation systems), including development of intermodal facilities, track or signal improvements, or the elimination of grade crossings, for the improvement of train speeds or safety (or both) on the high-speed rail corridors designated under section 104(d)(2) of title 23, United States Code, as in effect on the date of the enactment of this section, and

`(C) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements, including station rehabilitation or construction, development of intermodal facilities, track or signal improvements, or the elimination of grade crossings, for the improvement of train speeds or safety (or both) for other intercity passenger rail corridors and for the Alaska Railroad.

`(2) REFINANCING RULES- For purposes of paragraph (1), a refinancing shall constitute a qualified project only if the indebtedness being refinanced (including any obligation directly or indirectly refinanced by such indebtedness) was originally incurred by the issuer--

`(A) after the date of the enactment of this section,

`(B) for a term of not more than 3 years,

`(C) to finance or acquire capital improvements described in paragraph (1), and

`(D) in anticipation of being refinanced with proceeds of a qualified Amtrak bond.

`(k) STATE CONTRIBUTION REQUIREMENTS-

`(1) IN GENERAL- For purposes of subsection (e)(4), the State contribution requirement of this subsection is met with respect to any qualified project if the National Railroad Passenger Corporation has received from 1 or more States, not later than the date of issuance of the bond, matching contributions of not less than 20 percent of the cost of the qualified project.

`(2) NO STATE CONTRIBUTION REQUIREMENT FOR CERTAIN QUALIFIED PROJECTS- The State contribution requirement of this subsection is zero with respect to the following projects:

`(A) Any qualified project for the acquisition and installation of platform facilities, performance of railroad force account work necessary to complete improvements below street grade, and any other necessary improvements related to construction at the railroad station at the James A. Farley Post Office Building in New York City, New York.

`(B) Any project described in subsection (j)(1)(C) for the Alaska Railroad.

`(3) STATE MATCHING CONTRIBUTIONS MAY NOT INCLUDE FEDERAL FUNDS- For purposes of this subsection, State matching contributions shall not be derived, directly or indirectly, from Federal funds, including any transfers from the Highway Trust Fund under section 9503.

`(l) OTHER DEFINITIONS AND SPECIAL RULES- For purposes of this section--

`(1) BOND- The term `bond' includes any obligation.

`(2) TREATMENT OF CHANGES IN USE- For purposes of subsection (e)(1), the proceeds from the sale of an issue shall not be treated as used for a qualified project to the extent that the issuer takes any action within its control which causes such proceeds not to be used for a qualified project. The Secretary shall prescribe regulations specifying remedial actions that may be taken (including conditions to taking such remedial actions) to prevent an action described in the preceding sentence from causing a bond to fail to be a qualified Amtrak bond.

`(3) PARTNERSHIP; S CORPORATION; AND OTHER PASS-THRU ENTITIES- Under regulations prescribed by the Secretary, in the case of a partnership, trust, S corporation, or other pass-thru entity, rules similar to the rules of section 41(g) shall apply with respect to the credit allowable under subsection (a).

`(4) BONDS HELD BY REGULATED INVESTMENT COMPANIES- If any qualified Amtrak bond is held by a regulated investment company, the credit determined under subsection (a) shall be allowed to shareholders of such company under procedures prescribed by the Secretary.

`(5) REPORTING- Issuers of qualified Amtrak bonds shall submit reports similar to the reports required under section 149(e).'.

(b) AMENDMENTS TO OTHER CODE SECTIONS-

(1) REPORTING- Subsection (d) of section 6049 of the Internal Revenue Code of 1986 (relating to returns regarding payments of interest) is amended by adding at the end the following new paragraph:

`(8) REPORTING OF CREDIT ON QUALIFIED AMTRAK BONDS-

`(A) IN GENERAL- For purposes of subsection (a), the term `interest' includes amounts includible in gross income under section 54(d) and such amounts shall be treated as paid on the credit allowance date (as defined in section 54(b)(4)).

`(B) REPORTING TO CORPORATIONS, ETC- Except as otherwise provided in regulations, in the case of any interest described in subparagraph (A), subsection (b)(4) shall be applied without regard to subparagraphs (A), (H), (I), (J), (K), and (L)(i) of such subsection.

`(C) REGULATORY AUTHORITY- The Secretary may prescribe such regulations as are necessary or appropriate to carry out the purposes of this paragraph, including regulations which require more frequent or more detailed reporting.'.

(2) TREATMENT FOR ESTIMATED TAX PURPOSES-

(A) INDIVIDUAL- Section 6654 of such Code (relating to failure by individual to pay estimated income tax) is amended by redesignating subsection (m) as subsection (n) and by inserting after subsection (l) the following new subsection:

`(m) SPECIAL RULE FOR HOLDERS OF QUALIFIED AMTRAK BONDS- For purposes of this section, the credit allowed by section 54 to a taxpayer by reason of holding a qualified Amtrak bond on a credit allowance date shall be treated as if it were a payment of estimated tax made by the taxpayer on such date.'.

(B) CORPORATE- Section 6655 of such Code (relating to failure by corporation to pay estimated income tax) is amended by adding at the end of subsection (g) the following new paragraph:

`(5) SPECIAL RULE FOR HOLDERS OF QUALIFIED AMTRAK BONDS- For purposes of this section, the credit allowed by section 54 to a taxpayer by reason of holding a qualified Amtrak bond on a credit allowance date shall be treated as if it were a payment of estimated tax made by the taxpayer on such date.'.

(3) EXCLUSION FROM GROSS INCOME OF CONTRIBUTIONS BY AMTRAK TO OTHER RAIL CARRIERS-

(A) IN GENERAL- Section 118 of the Internal Revenue Code of 1986 (relating to contributions to the capital of a corporation) is amended by redesignating subsection (d) as subsection (e) and by inserting after subsection (c) the following new subsection:

`(d) SPECIAL RULE FOR CONTRIBUTIONS BY AMTRAK TO OTHER RAIL CARRIERS- For purposes of this section, the term `contribution to the capital of the taxpayer' does not include any contribution by the National Railroad Passenger Corporation of personal or real property funded by the proceeds of qualified Amtrak bonds under section 54.'.

(B) CONFORMING AMENDMENT- Subsection (b) of such section 118 is amended by striking `subsection (c)' and inserting `subsections (c) and (d)'.

(4) PROTECTION OF HIGHWAY TRUST FUND- Section 9503 of such Code (relating to Highway Trust Fund) is amended by adding at the end the following new subsection:

`(g) SPECIAL RULE RELATING TO NATIONAL RAILROAD PASSENGER CORPORATION- Except as provided in subsection (c), as in effect on the date of the enactment of this subsection, amounts in the Highway Trust Fund may not be used to provide funds to the National Railroad Passenger Corporation for any purpose, including issuance of any qualified Amtrak bond pursuant to section 54. The preceding sentence may not be waived by any provision of law which is not contained or referenced in this title, whether such provision of law is a subsequently enacted provision or directly or indirectly seeks to waive the application of such sentence.'.

(c) CLERICAL AMENDMENTS-

(1) The table of subparts for part IV of subchapter A of chapter 1 is amended by adding at the end the following new item:

`Subpart H. Nonrefundable Credit for Holders of Qualified Amtrak Bonds.'.

(2) Section 6401(b)(1) is amended by striking `and G' and inserting `G, and H'.

(d) ANNUAL REPORT BY TREASURY ON AMTRAK TRUST ACCOUNT- The Secretary of the Treasury shall annually report to Congress as to whether the amount deposited in the trust account established by the National Railroad Passenger Corporation under section 54(i) of the Internal Revenue Code of 1986, as added by this section, is sufficient to fully repay at maturity the principal of any outstanding qualified Amtrak bonds issued pursuant to section 54 of such Code (as so added), together with amounts expected to be deposited into such account, as certified by the National Railroad Passenger Corporation in accordance with procedures prescribed by the Secretary of the Treasury.

(e) ISSUANCE OF REGULATIONS- The Secretary of the Treasury shall issue regulations required under section 54 of the Internal Revenue Code of 1986 (as added by this section) not later than 90 days after the date of the enactment of this Act.

(f) EFFECTIVE DATE- The amendments made by this section shall apply to obligations issued after the date of enactment of this Act.

PART II--HIGH-SPEED RAIL PROVISIONS

SEC. 403. DEPARTMENT OF TRANSPORTATION APPROVAL FOR QUALIFIED AMTRAK PROJECTS.

(a) AMENDMENT- Part D of subtitle V of title 49, United States Code, is amended by adding at the end the following new chapter:

`CHAPTER 263--HIGH-SPEED RAIL INITIATIVES

`Sec.

`26301. Department of Transportation approval for qualified high-speed rail projects.

`26302. Qualified projects.

`26303. State contribution requirements.'.

`Sec. 26301. Department of Transportation approval for qualified high-speed rail projects

`(a) IN GENERAL- The written approval of a qualified project by the Secretary of Transportation required for purposes of subsection (e)(5) of section 54 of the Internal Revenue Code of 1986 (relating to credit to holders of qualified Amtrak bonds) shall include--

`(1) the finding by the Inspector General of the Department of Transportation described in subsection (b);

`(2) the certification by the Secretary of Transportation described in subsection (c); and

`(3) the agreement by the National Railroad Passenger Corporation described in subsection (d).

`(b) FINDING BY INSPECTOR GENERAL- For purposes of subsection (a), the finding described in this subsection is a finding by the Inspector General of the Department of Transportation that there is a reasonable likelihood that the proposed project will result in a positive financial contribution to the National Railroad Passenger Corporation and that the investment evaluation process includes consideration of a return on investment, leveraging of funds (including State capital and operating contributions), cost effectiveness, safety improvement, mobility improvement, and feasibility.

`(c) CERTIFICATION- For purposes of subsection (a), the certification described in this subsection is a certification by the Secretary of Transportation that the issuer of the qualified Amtrak bond--

`(1) except with respect to projects described in section 54(j)(1)(C) of the Internal Revenue Code of 1986, has entered into a written agreement with the owners of rail properties which are to be improved by the project to be funded by the qualified Amtrak bond, as to the scope and estimated cost of such project and the impact on rail freight capacity; and

`(2) has met the State contribution requirements described in section 26303.

The National Railroad Passenger Corporation shall not exercise its rights under section 24308(a)(2) to resolve disputes with respect to a project to be funded by a qualified Amtrak bond, or with respect to the cost of such a project, unless the project is intended to result in railroad speeds of 79 miles per hour or less.

`(d) AGREEMENT BY AMTRAK TO ISSUE ADDITIONAL BONDS FOR PROJECTS OF OTHER CARRIERS-

`(1) IN GENERAL- For purposes of subsection (a), the agreement described in this subsection is an agreement by the National Railroad Passenger Corporation with the Secretary of Transportation to issue bonds which meet the requirements of section 54 of the Internal Revenue Code of 1986 for use in financing projects described in paragraph (2).

`(2) PROJECTS COVERED- For purposes of paragraph (1), the projects described in this paragraph are any project described in subsection (j)(1)(B) or (j)(1)(C) of section 54 of the Internal Revenue Code of 1986 for an intercity rail passenger carrier other than the National Railroad Passenger Corporation or for the Alaska Railroad.

`(3) ADDITIONAL REQUIREMENTS- Any project financed by bonds referred to in paragraph (1) shall be carried out by the intercity rail passenger carrier other than the National Railroad Passenger Corporation, through a contract entered into by the National Railroad Passenger Corporation with such carrier. Such other intercity rail passenger carrier, in carrying out the project, shall be subject to the provisions of this subtitle governing the National Railroad Passenger Corporation.

`(4) DEFINITION- For purposes of this subsection, the term `intercity rail passenger carrier' means any rail carrier (as such term is defined in section 24102(7)) that is part of the interstate system of rail transportation and that provides intercity rail passenger transportation (as such term is defined in section 24102(5)).

`(e) ADDITIONAL SELECTION CRITERIA- In determining projects to be approved under this section (other than projects for the Alaska Railroad), or to be included in an agreement under subsection (d), the Secretary of Transportation shall give preference to--

`(1) any project with a State matching contribution rate exceeding 20 percent;

`(2) projects expected to have a significant impact on air traffic congestion;

`(3) projects expected to also improve commuter rail operations;

`(4) projects that anticipate fares designed to recover costs and generate a return on investment; and

`(5) projects that promote regional balance in infrastructure investment and the national interest in ensuring the development of a nationwide high-speed rail transportation network.

`Sec. 26302. Qualified projects

`For purposes of this chapter--

`(1) IN GENERAL- The term `qualified project' means--

`(A) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements (including the introduction of new high-speed technologies such as magnetic levitation systems), including track or signal improvements or the elimination of grade crossings, for the northeast rail corridor between Washington, D.C., and Boston, Massachusetts;

`(B) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements (including the introduction of new high-speed technologies such as magnetic levitation systems), including development of intermodal facilities, track or signal improvements, or the elimination of grade crossings, for the improvement of train speeds or safety (or both) on the high-speed rail corridors designated under section 104(d)(2) of title 23, United States Code, as in effect on the date of the enactment of this section; and

`(C) the acquisition, financing, or refinancing of equipment, rolling stock, and other capital improvements, including station rehabilitation or construction, development of intermodal facilities, track or signal improvements, or the elimination of grade crossings, for the improvement of train speeds or safety (or both) for other intercity passenger rail corridors and for the Alaska Railroad.

`(2) REFINANCING RULES- For purposes of paragraph (1), a refinancing shall constitute a qualified project only if the indebtedness being refinanced (including any obligation directly or indirectly refinanced by such indebtedness) was originally incurred by the issuer--

`(A) after the date of the enactment of this section;

`(B) for a term of not more than 3 years;

`(C) to finance or acquire capital improvements described in paragraph (1); and

`(D) in anticipation of being refinanced with proceeds of a qualified Amtrak bond.

`Sec. 26303. State contribution requirements

`(a) IN GENERAL- For purposes of section 26301(c)(2), the State contribution requirement of this section is met with respect to any qualified project if the National Railroad Passenger Corporation has received from 1 or more States, not later than the date of issuance of the bond, matching contributions of not less than 20 percent of the cost of the qualified project.

`(b) NO STATE CONTRIBUTION REQUIREMENT FOR CERTAIN QUALIFIED PROJECTS- The State contribution requirement of this section is zero with respect to the following projects:

`(1) Any qualified project for the acquisition and installation of platform facilities, performance of railroad force account work necessary to complete improvements below street grade, and any other necessary improvements related to construction at the railroad station at the James A. Farley Post Office Building in New York City, New York.

`(2) Any project described in subsection (j)(1)(C) of section 54 of the Internal Revenue Code of 1986 for the Alaska Railroad.

`(c) STATE MATCHING CONTRIBUTIONS MAY NOT INCLUDE FEDERAL FUNDS- For purposes of this section, State matching contributions shall not be derived, directly or indirectly, from Federal funds, including any transfers from the Highway Trust Fund under section 9503 of the Internal Revenue Code of 1986.'.

(b) TABLE OF CHAPTERS AMENDMENT- The table of chapters of subtitle V of title 49, United States Code, is amended by inserting after the item relating to chapter 261 the following new item:

--26301'.

SEC. 404. MULTIYEAR CAPITAL SPENDING PLAN AND OVERSIGHT.

(a) AMENDMENT- Chapter 243 of title 49, United States Code, is amended by adding at the end the following new section:

`Sec. 24316. Multiyear capital spending plan and oversight

`(a) AMTRAK CAPITAL SPENDING PLAN-

`(1) IN GENERAL- The National Railroad Passenger Corporation shall annually submit to the President and Congress a multiyear capital spending plan, as approved by the Board of Directors of the Corporation.

`(2) CONTENTS OF PLAN- Such plan shall identify the capital investment needs of the Corporation over a period of not less than 5 years and the funding sources available to finance such needs and shall prioritize such needs according to corporate goals and strategies.

`(3) INITIAL SUBMISSION DATE- The first plan shall be submitted before the issuance of any qualified Amtrak bonds by the National Railroad Passenger Corporation pursuant to section 54 of the Internal Revenue Code of 1986.

`(b) OVERSIGHT OF QUALIFIED PROJECTS- The Secretary of Transportation shall contract for an annual independent assessment of the costs and benefits of the qualified projects financed by

qualified Amtrak bonds pursuant to section 54 of the Internal Revenue Code of 1986, including an assessment of the investment evaluation process of the Corporation. The annual assessment shall be included in the plan submitted under subsection (a).'.

(b) TABLE OF SECTIONS AMENDMENT- The table of sections of chapter 243 of title 49, United States Code, is amended by adding after the item relating to section 24315 the following new item:

`24316. Multiyear capital spending plan and oversight.'.

SEC. 405. ISSUANCE OF REGULATIONS.

The Secretary of Transportation shall issue regulations for carrying out chapter 263 of title 49, United States Code (as added by section 111 of this Act), not later than 90 days after the date of the enactment of this Act.

SEC. 406. SENSE OF CONGRESS REGARDING EFFECT ON AMTRAK FUNDING.

It is the sense of the Congress that the proceeds of qualified Amtrak bonds issued under section 54 of the Internal Revenue Code of 1986 are intended to finance the construction of qualified projects (as defined in section 26302 of title 49, United States Code, as added by section 111 of this Act) and are not intended to meet the regular, ongoing capital funding needs of the National Railroad Passenger Corporation.

SEC. 407. EFFECTIVE DATE.

The amendments made by this part shall apply to obligations issued after the date of the enactment of this Act.

PART III--AMTRAK CAPITAL INVESTMENT

SEC. 411. AUTHORIZATION OF APPROPRIATIONS.

Section 24104(a) of title 49, United States Code, is amended--

(1) by inserting `(1)' after `IN GENERAL- ';

(2) by redesignating paragraphs (1) through (5) as subparagraphs (A) through (E), respectively; and

(3) by adding at the end the following new paragraph:

`(2) There are authorized to be appropriated to the Secretary of Transportation $3,000,000,000 for fiscal year 2002 for the benefit of Amtrak for capital expenditures including--

`(A) New York, Washington, D.C., and Baltimore tunnel life safety projects;

`(B) bridges, tracks, and other improvements to increase the capacity and reliability of rail passenger transportation; and

`(C) equipment, including acquisition of trainsets and rolling stock, for operation in federally designated corridors.

At least 2/3 of amounts expended under subparagraph (C) shall be for operations outside the Northeast Corridor.'.

PART IV--CAPITAL INVESTMENT FOR RAILROAD REHABILITATION

SEC. 416. CAPITAL GRANTS FOR RAILROAD TRACK.

(a) AMENDMENT- Chapter 223 of title 49, United States Code, is amended to read as follows:

`CHAPTER 223--CAPITAL GRANTS FOR RAILROAD TRACK

`Sec.

`22301. Capital grants for railroad track.

`Sec. 22301. Capital grants for railroad track

`(a) ESTABLISHMENT OF PROGRAM-

`(1) ESTABLISHMENT- The Secretary of Transportation shall establish a program of capital grants for the rehabilitation, preservation, or improvement of railroad track (including roadbed, bridges, and related track structures) of class II and class III railroads. Such grants shall be for rehabilitating, preserving, or improving track used primarily for freight transportation to a standard ensuring that the track can be operated safely and efficiently, including grants for rehabilitating, preserving, or improving track to handle 286,000 pound rail cars. Grants may be provided under this chapter--

`(A) directly to the class II or class III railroad; or

`(B) with the concurrence of the class II or class III railroad, to a State or local government.

`(2) STATE COOPERATION- Class II and class III railroad applicants for a grant under this chapter are encouraged to utilize the expertise and assistance of State transportation agencies in applying for and administering such grants. State transportation agencies are encouraged to provide such expertise and assistance to such railroads.

`(3) INTERIM REGULATIONS- Not later than December 31, 2001, the Secretary shall issue temporary regulations to implement the program under this section. Subchapter II of chapter 5 of title 5 does not apply to a temporary regulation issued under this paragraph or to an amendment to such a temporary regulation.

`(4) FINAL REGULATIONS- Not later than October 1, 2002, the Secretary shall issue final regulations to implement the program under this section.

`(b) MAXIMUM FEDERAL SHARE- The maximum Federal share for carrying out a project under this section shall be 80 percent of the project cost. The non-Federal share may be provided by any non-Federal source in cash, equipment, or supplies. Other in-kind contributions may be approved by the Secretary on a case by case basis consistent with this chapter.

`(c) PROJECT ELIGIBILITY- For a project to be eligible for assistance under this section the track must have been operated or owned by a class II or class III railroad as of the date of the enactment of this section.

`(d) USE OF FUNDS- Grants provided under this section shall be used to implement track capital projects as soon as possible. In no event shall grant funds be contractually obligated for a project later than the end of the third Federal fiscal year following the year in which the grant was awarded. Any funds not so obligated by the end of such fiscal year shall be returned to the Secretary for reallocation.

`(e) ADDITIONAL PURPOSE- In addition to making grants for projects as provided in subsection (a), the Secretary may also make grants to supplement direct loans or loan guarantees made under title V of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(d)), for projects described in the last sentence of section 502(d) of such title. Grants made under this subsection may be used, in whole or in part, for paying credit risk premiums, lowering rates of interest, or providing for a holiday on principal payments. Credit risk premiums funded under this section shall be exempt from the non-Federal source requirement of section 502(f)(1) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(f)(1)).

`(f) EMPLOYEE PROTECTION- The Secretary shall require as a condition of any grant made under this section that the recipient railroad provide a fair arrangement at least as protective of the interests of employees who are affected by the project to be funded with the grant as the terms imposed under section 11326(a), as in effect on the date of the enactment of this section.

`(g) LABOR STANDARDS-

`(1) PREVAILING WAGES- The Secretary shall ensure that laborers and mechanics employed by contractors and subcontractors in construction work financed by a grant made under this section will be paid wages not less than those prevailing on similar construction in the locality, as determined by the Secretary of Labor under the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.). The Secretary shall make a grant under this section only after being assured that required labor standards will be maintained on the construction work.

`(2) WAGE RATES- Wage rates in a collective bargaining agreement negotiated under the Railway Labor Act (45 U.S.C. 151 et seq.) are deemed for purposes of this subsection to comply with the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.).

`(h) STUDY- The Secretary shall conduct a study of the projects carried out with grant assistance under this section to determine the public interest benefits associated with the light density railroad networks in the States and their contribution to a multimodal transportation system. Not later than March 31, 2003, the Secretary shall report to Congress any recommendations the Secretary considers appropriate regarding the eligibility of light density rail networks for Federal infrastructure financing.

`(i) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be appropriated to the Secretary of Transportation $500,000,000 for fiscal year 2002 for carrying out this section.'.

(b) CONFORMING AMENDMENTS- (1) The item relating to chapter 223 in the table of chapters of subtitle V of title 49, United States Code, is amended to read as follows:

--22301'.

(2) Section 502(d) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(d)) is amended--

(A) by striking `$3,500,000,000' and inserting `$5,000,000,000'; and

(B) by striking `$1,000,000,000' and inserting `$1,500,000,000'.

SEC. 417. REGULATORY PROCEDURE AMENDMENTS.

(a) COHORTS OF LOANS- Section 502(f) of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822(f)) is amended--

(1) in paragraph (2)--

(A) by striking `and' at the end of subparagraph (D);

(B) by redesignating subparagraph (E) as subparagraph (F); and

(C) by adding after subparagraph (D) the following new subparagraph:

`(E) the size and characteristics of the cohort of which the loan or loan guarantee is a member; and'; and

(2) by adding at the end of paragraph (4) the following: `A cohort may include loans and loan guarantees. The Secretary shall not establish any limit on the proportion of a cohort that may be used for 1 loan or loan guarantee.'.

(b) CONDITIONS OF ASSISTANCE- Section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822) is amended--

(1) in subsection (f)(2)(A), by inserting `, if any' after `collateral offered'; and

(2) by adding at the end of subsection (h) the following:

`The Secretary shall not require an applicant for a direct loan or loan guarantee under this section to provide collateral. The Secretary shall not require that an applicant for a direct loan or loan guarantee under this section have previously sought the financial assistance requested from another source. The Secretary shall require recipients of direct loans or loan guarantees under this section to apply the standards of section 26106(a)(5) of title 49, United States Code, to their projects, except for projects primarily benefiting Class III freight railroads.'.

(c) TIME LIMIT FOR APPROVAL OR DISAPPROVAL- Section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822) is amended by adding at the end the following new subsection:

`(i) TIME LIMIT FOR APPROVAL OR DISAPPROVAL- Not later than 180 days after receiving a complete application for a direct loan or loan guarantee under this section, the Secretary shall approve or disapprove the application.'.

(d) FEES AND CHARGES- Section 503 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 823) is amended by adding at the end the following new subsection:

`(l) FEES AND CHARGES- Except as provided in this title, the Secretary may not assess any fees, including user fees, or charges in connection with a direct loan or loan guarantee provided under section 502.'.

(e) SUBSTANTIVE CRITERIA AND STANDARDS- Not later than 30 days after the date of the enactment of this Act, the Secretary of Transportation shall publish in the Federal Register and post on the Department of Transportation web site the substantive criteria and standards used by the Secretary to determine whether to approve

or disapprove applications submitted under section 502 of the Railroad Revitalization and Regulatory Reform Act of 1976 (45 U.S.C. 822).

Subtitle B--Environmental Infrastructure Investment

SEC. 421. GENERAL AUTHORITY FOR CAPITALIZATION GRANTS.

Section 601(a) of the Federal Water Pollution Control Act (33 U.S.C. 1381(a)) is amended by striking `(1) for construction' and all that follows through the period and inserting `to accomplish the objectives, goals, and policies of this Act.'.

SEC. 422. CAPITALIZATION GRANTS AGREEMENTS.

(a) REQUIREMENTS FOR CONSTRUCTION OF TREATMENT WORKS- Section 602(b)(6) of the Federal Water Pollution Control Act (33 U.S.C. 1382(b)(6)) is amended--

(1) by striking `treatment works' the first place it appears and inserting `activities';

(2) by striking `before fiscal year 1995' and all that follows through `grants under this title' and inserting `with funds made available by capitalization grants under this title (including repayments thereof)'; and

(3) by striking `201(b)' and all that follows through `218' and inserting `204(b)(1), 211'.

(b) GUIDANCE FOR SMALL SYSTEMS- Section 602 of the Federal Water Pollution Control Act (33 U.S.C. 1382) is amended by adding at the end the following new subsection:

`(c) GUIDANCE FOR SMALL SYSTEMS-

`(1) SIMPLIFIED PROCEDURES- Not later than 1 year after the date of the enactment of this subsection, the Administrator shall assist the States in establishing simplified procedures for small systems to obtain assistance under this title.

`(2) PUBLICATION OF MANUAL- Not later than 1 year after the date of the enactment of this subsection, and after providing notice and opportunity for public comment, the Administrator shall publish a manual to assist small systems in obtaining assistance under this title and publish in the Federal Register notice of the availability of the manual.

`(3) SMALL SYSTEM DEFINED- For purposes of this title, the term `small system' means a system for which a municipality or intermunicipal, interstate, or State agency seeks assistance under this title and which serves a population of 20,000 or fewer.'.

SEC. 423. WATER POLLUTION CONTROL REVOLVING FUNDS.

(a) ACTIVITIES ELIGIBLE FOR ASSISTANCE- Section 603(c) of the Federal Water Pollution Control Act (33 U.S.C. 1383(c)) is amended to read as follows:

`(c) ACTIVITIES ELIGIBLE FOR ASSISTANCE-

`(1) IN GENERAL- The amounts of funds available to each State water pollution control revolving fund shall be used only for providing financial assistance to a municipality, intermunicipal agency, interstate agency, State agency, or other person for activities which have as a principal benefit the improvement or protection of water quality. Such activities may include the following:

`(A) Construction of a publicly owned treatment works (as defined in section 212 of this Act).

`(B) Implementation of lake protection programs and projects under section 314.

`(C) Implementation of a management program established under section 319.

`(D) Implementation of a conservation and management plan established under section 320.

`(E) Restoration or protection of publicly or privately owned riparian areas, including acquisition of property rights.

`(F) Implementation of measures to improve the efficiency of public water use.

`(G) Development and implementation of plans by a public recipient to prevent water pollution.

`(H) Acquisition of lands necessary to meet any mitigation requirements related to construction of a publicly owned treatment works.

`(2) FUND AMOUNTS- The water pollution control revolving fund of a State shall be established, maintained, and credited with repayments, and the fund balance shall be available in perpetuity for providing financial assistance for activities described in paragraph (1). Fees charged by a State to recipients of such assistance may be deposited in the fund for the sole purpose of financing the cost of administration of this title.'.

(b) EXTENDED REPAYMENT PERIOD FOR FINANCIALLY DISTRESSED COMMUNITIES- Section 603(d)(1) of the Federal Water Pollution Control Act (33 U.S.C. 1383(d)(1)) is amended--

(1) in subparagraph (A) by inserting after `20 years' the following: `or, in the case of a financially distressed community, the lesser of 40 years or the expected life of the project to be financed with the proceeds of the loan'; and

(2) in subparagraph (B) by striking `not later than 20 years after project completion' and inserting `upon the expiration of the term of the loan'.

(c) ADMINISTRATIVE EXPENSES- Section 603(d)(7) of the Federal Water Pollution Control Act (33 U.S.C. 1383(d)(7)) is amended by inserting before the period at the end the following: `or $400,000 per year or 1/2 percent per year of the current valuation of such fund, whichever is greatest, plus the amount of any fees collected by the State for such purpose under subsection (c)(2)'.

(d) TECHNICAL AND PLANNING ASSISTANCE FOR SMALL SYSTEMS- Section 603(d) of the Federal Water Pollution Control Act (33 U.S.C. 1383(d)) is amended--

(1) by striking `and' at the end of paragraph (6);

(2) by striking the period at the end of paragraph (7) and inserting `; and'; and

(3) by adding at the end the following:

`(8) to provide to small systems technical and planning assistance and assistance in financial management, user fee analysis, budgeting, capital improvement planning, facility operation and maintenance, repair schedules, and other activities to improve wastewater treatment plant operations; except that such amounts shall not exceed 2 percent of all grant awards to such fund under this title.'.

(e) PRINCIPAL SUBSIDIZATION- Section 603 of the Federal Water Pollution Control Act is amended by adding at the end the following:

`(i) PRINCIPAL SUBSIDIZATION- In any case in which a State makes a loan pursuant to subsection (d)(1) to a financially distressed community, the State may provide additional subsidization, including forgiveness of principal. The total amount of loan subsidies made by a State under this subsection in a fiscal year may not exceed 30 percent of the amount of the capitalization grant received by the State in such fiscal year.

`(j) FINANCIALLY DISTRESSED COMMUNITY DEFINED- In this section, the term `financially distressed community' means any community that meets affordability criteria established by the State in which the treatment works is located, if such criteria are developed after public review and comment.

`(k) INFORMATION TO ASSIST STATES- The Administrator may publish information to assist States in establishing affordability criteria under subsection (j).

`(l) PRIORITY- A State may give priority to a financially distressed community in making loans from its water pollution control revolving fund.'.

SEC. 424. AUTHORIZATION OF APPROPRIATIONS FOR CLEAN WATER STATE REVOLVING FUNDS.

Section 607 of the Federal Water Pollution Control Act (33 U.S.C. 1387) is amended--

(1) by striking `and' at the end of paragraph (4);

(2) by striking the period at the end of paragraph (5) and inserting `; and'; and

(3) by adding at the end the following:

`(6) $5,000,000,000 as an additional amount for fiscal year 2002.'.

SEC. 425. WET WEATHER.

Section 221(f) of the Federal Water Pollution Control Act (33 U.S.C. 1301(f)) is amended by inserting after the first sentence the following: `In addition, there is authorized to be appropriated to carry out this section an additional $1,500,000,000 for fiscal year 2002.'.

SEC. 426. SAFE DRINKING WATER STATE REVOLVING FUNDS.

Section 1452(m) of title XIV of the Public Health Service Act (commonly known as the `Safe Drinking Water Act') (42 U.S.C. 300j-12(m)) is amended by inserting after the first sentence the following: `In addition, there is authorized to be appropriated to carry out this section an additional $1,500,000,000 for fiscal year 2002.'.

Subtitle C--Highway Infrastructure Investment

SEC. 431. FEDERAL-AID HIGHWAY PROGRAM OBLIGATION CEILING.

Section 1102 of the Transportation Equity Act for the 21st Century (112 Stat. 115) is amended by adding at the end the following:

`(j) INCREASE IN OBLIGATION LIMIT FOR FISCAL YEAR 2002- Notwithstanding any other provision of law, limitations on obligations imposed by subsection (a) for fiscal year 2002 shall be increased by $5,000,000,000. Such sum shall be distributed in accordance with this section, except that a program subject to a reduction in funds under subsection (f) shall receive an amount of obligation authority equal to the amount of contract authority available for such program in such fiscal year.'.

SEC. 432. LIMITATIONS ON CREDIT AMOUNTS.

Section 188(c) of title 23, United States Code, is amended--

(1) by striking `For each of' and inserting the following:

`(1) IN GENERAL- For each of';

(2) by adding at the end the following:

`(2) SPECIAL RULE- Notwithstanding any other provision of law, principal amounts of Federal credit instruments authorized under this subsection for fiscal years 1999, 2000, and 2001 that have not been made available shall be available in fiscal years 2002 and 2003, in addition to amounts authorized for such fiscal years.'; and

(3) by aligning the remainder of the text of paragraph (1) (as designated by paragraph (1) of this section) preceding the table with paragraph (2) (as added by paragraph (2) of this section).

Subtitle D--Transit Infrastructure Investment

SEC. 441. ADDITIONAL AUTHORIZATIONS FOR FORMULA GRANTS.

(a) FROM THE TRUST FUND- Section 5338(a)(2)(A)(iv) of title 49, United States Code, is amended by striking `$2,873,600,000' and inserting `$5,273,600,000'.

(b) FROM THE GENERAL FUND- Section 5338(a)(2)(B)(iv) of title 49, United States Code, is amended by striking `$718,400,000' and inserting `$1,318,400,000'.

(c) AVAILABILITY OF AMOUNTS- Notwithstanding sections 5307(k)(2) and section 5336(i), any increase in the amounts apportioned to a recipient attributable to the amendments made by subsections (a) and (b) of this section may be obligated by the recipient for 1 year after the last day of the fiscal year in which the amount is apportioned. Not later than 30 days after the end of the 1-year period, an amount that is not obligated at the end of that period shall be added to the amount that may be apportioned under the urbanized area formula program of section 5336 of title 49, United States Code.

SEC. 442. FEDERAL TRANSIT PROGRAM OBLIGATION CEILING.

Section 3040(4) of the Transportation Equity Act for the 21st Century (112 Stat. 338) is amended by striking `$6,747,000,000' and inserting `$9,747,000,000'.

SEC. 443. UNIFORM DOLLAR LIMITATION FOR ALL TYPES OF TRANSPORTATION FRINGE BENEFITS.

(a) IN GENERAL- Subparagraph (A) of section 132(f)(2) of the Internal Revenue Code of 1986 (relating to limitation on exclusion) is amended by striking `$100' and inserting `$175'.

(b) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 2001.

Subtitle E--AVIATION INFRASTRUCTURE INVESTMENT

SEC. 451. INCREASED FUNDING FOR AIRPORT PLANNING AND DEVELOPMENT.

(a) IN GENERAL- Section 48103(4) of title 49, United States Code, is amended by striking `$3,300,000,000' and inserting `$5,355,000,000.'.

(b) DISCRETIONARY FUND- Section 47115 of title 49, United States Code, is amended by adding at the end the following:

`(i) ADDITIONAL AMOUNT TO BE CREDITED TO FUND FOR FISCAL YEAR 2002-

`(1) IN GENERAL- In addition to other amounts credited to the fund under this section, there shall be credited to the fund $2,055,000,000 out of amounts made available to the Secretary for fiscal year 2002 under section 48103(4).

`(2) APPORTIONMENT CATEGORIES DO NOT APPLY- Section 47117(e) does not apply to amounts credited to the fund under this subsection.'.

(c) CONFORMING AMENDMENT- Section 47114 of title 49, United States Code, is amended by adding at the end the following:

`(g) SPECIAL RULE FOR FISCAL YEAR 2002- Of the funds made available by section 48103(4), the amount subject to apportionment under this section shall be reduced by the amount credited to the discretionary fund under section 47115(i).'.

SEC. 452. INCREASED FUNDING FOR AIRWAY FACILITIES IMPROVEMENT.

Section 48101(a)(4) of title 49, United States Code, is amended by striking `$2,914,000,000' and inserting `$3,859,000,000'.

Subtitle F--Maritime Infrastructure Investment

SEC. 461. MARINE TRANSPORTATION SYSTEM INFRASTRUCTURE.

(a) MARITIME LOAN GUARANTEES- For expenses under the loan guarantee program authorized by title XI of the Merchant Marine Act, 1936 (46 App. U.S.C. 1271 et seq.) there is authorized to be appropriated, in addition to any other amounts authorized for such expenses, $100,000,000 for fiscal years 2002 and 2003, of which--

(1) $87,000,000 is for the cost (as defined in section 502(5) of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a(5))) of loan guarantees under the program, including the costs of modifying such loans, of which $5,000,000 shall be used to guarantee loans for ferries using a streamlined process; and

(2) $13,000,000 is for administrative expenses related to loan guarantee commitments under the program.

(b) MARINE TRANSPORTATION SYSTEM IMPROVEMENT GRANTS-

(1) GRANTS AUTHORITY- The Secretary of Transportation may make a grant to the operator of any port or maritime cargo terminal in the United States to acquire the best available technology, equipment, or infrastructure to expedite the transportation of cargo through the port or terminal, respectively.

(2) QUALIFIED PROJECTS- A project shall not qualify for a grant under this section unless it provides technology, equipment, or infrastructure that will significantly increase the actual throughput of cargo through a port or terminal facility.

(3) COST SHARING- The Federal share of the cost of a project carried out with a grant under this subsection shall not exceed 50 percent.

(4) REGULATIONS- The Secretary shall, before July 1, 2002, prescribe final regulations for issuing grants under this subsection.

(5) AUTHORIZATION OF APPROPRIATIONS- For grants under this subsection there is authorized to be appropriated to the Secretary $500,000,000 for fiscal years 2002 and 2003.

Subtitle G--Economic Development Infrastructure Investment

SEC. 471. PUBLIC WORKS AND ECONOMIC DEVELOPMENT.

Section 701 of the Public Works and Economic Development Act of 1965 (42 U.S.C. 3231) is amended--

(1) by inserting `(a) IN GENERAL- ' before `There are authorized'; and

(2) by adding at the end the following:

`(b) ADDITIONAL AUTHORIZATION- In addition to amounts authorized by subsection (a), there are authorized to be appropriated to carry out this Act $900,000,000 for fiscal year 2002. Such sums shall remain available until September 30, 2003.'.

SEC. 472. APPALACHIAN REGIONAL DEVELOPMENT.

Section 401 of the Appalachian Regional Development Act of 1965 (40 U.S.C. App.) is amended by adding at the end the following:

`(c) ADDITIONAL AUTHORIZATION- In addition to amounts authorized by subsection (a), there are authorized to be appropriated to the Commission to carry out this Act $200,000,000 for fiscal year 2002. Such sums shall remain available until September 30, 2003.'.

SEC. 473. DELTA REGIONAL DEVELOPMENT.

Section 382M of the Consolidated Farm and Rural Development Act (7 U.S.C. 2009aa-12) is amended--

(1) by redesignating subsection (b) as subsection (c);

(2) by inserting after subsection (a) the following:

`(b) ADDITIONAL AUTHORIZATION- In addition to amounts authorized by subsection (a), there are authorized to be appropriated to the Authority to carry out this subtitle $200,000,000 for fiscal year 2002. Such sums shall remain available until September 30, 2003.'; and

(3) in subsection (c) (as so redesignated) by striking `subsection (a)' and inserting `subsections (a) and (b)'.

Subtitle H--Water Resources Infrastructure Investment

SEC. 481. INCREASED FUNDING FOR CORPS OF ENGINEERS PROJECTS.

(a) AUTHORIZATION OF APPROPRIATIONS- In addition to other amounts authorized to be appropriated, there are authorized to be appropriated to the Secretary of the Army $1,200,000,000 for fiscal year 2002 to carry out construction, operation, and maintenance activities for authorized civil functions under the supervision of the Chief of Engineers. Such sums shall remain available until September 30, 2003.

(b) ALLOCATION OF AMOUNTS FOR SECURITY PURPOSES- Of the amounts appropriated pursuant to subsection (a), not less than $263,000,000 shall be available for security purposes at critical infrastructure, as identified by the Secretary of the Army.

Subtitle I--Public Buildings Infrastructure Investment

SEC. 491. SECURITY ENHANCEMENTS FOR GSA PROPERTIES.

(a) AUTHORIZATION OF APPROPRIATIONS- In addition to other amounts credited to the Federal Buildings Fund established pursuant to section 210(f) of the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 490(f)), there is authorized to be appropriated $500,000,000 for fiscal year 2002 to be credited to the Fund. Such sums shall remain available until September 30, 2003.

(b) USE OF FUNDS- Amounts credited to the Fund under this section shall be available to the Administrator of General Services to carry out projects and activities for enhancing the security of properties under the control of the General Services Administration, including general purpose office space, courthouses, and border crossing stations, and for other repair and alteration purposes.

SEC. 492. SECURITY ENHANCEMENTS FOR JOHN F. KENNEDY CENTER.

Section 12 of the John F. Kennedy Center Act (20 U.S.C. 76r) is amended by adding at the end the following:

`(d) ADDITIONAL AUTHORIZATION- In addition to the amounts authorized under subsections (a) and (b), there is authorized to be appropriated to the Board $50,000,000 for fiscal year 2002 to carry out projects and activities for enhancing the security of the building and site of the John F. Kennedy Center for the Performing Arts and other projects and activities under subparagraphs (F), (G), and (H) of section 4(a)(1).'.

SEC. 493. SECURITY ENHANCEMENTS FOR SMITHSONIAN INSTITUTION.

In addition to other amounts authorized to be appropriated, there is authorized to be appropriated to the Smithsonian Institution $50,000,000 for fiscal year 2002 to carry out projects and activities for enhancing the security of the buildings and grounds of the Smithsonian Institution and for other capital improvement or repair and alteration purposes.

Subtitle J--General Provisions

SEC. 495. PRIORITY CONSIDERATION FOR SECURITY PROJECTS.

The head of a Federal department or agency may provide financial assistance with any increase in funds authorized or made available by, or with any increase in obligation authority made available by, this Act (including the amendments made by this Act) only if the recipient of such assistance certifies to the head of such department or agency that the recipient will give priority consideration to programs or projects that enhance security, to the extent that such programs or projects are immediately ready to be implemented.

SEC. 496. TEMPORARY WAIVER OF NON-FEDERAL SHARE.

(a) IN GENERAL- Notwithstanding any other provision of law and subject to subsection (b), in providing financial assistance for a program or project with any increase in funds authorized or made available by, or with any increase in obligation authority made available by, this Act (including the amendments made by this Act (other than subtitle A of title I of this Act)), the head of a Federal department or agency, upon request of the recipient of such assistance, may increase the Federal share of the cost of the program or project to not to exceed 100 percent of such cost.

(b) REPAYMENTS- Before increasing the Federal share of the cost of a program or project under subsection (a), the head of a Federal department or agency shall enter into a legally binding agreement with the recipient of financial assistance for the program or project under which the recipient agrees to repay the United States for the increased Federal share of the program or project on or before September 30, 2003.

SEC. 497. MAINTENANCE OF EFFORT.

The head of a Federal department or agency may provide financial assistance for a program or project with any increase in funds authorized or made available by, or with any increase in obligation authority made available by, this Act (including the amendments made by this Act) for a fiscal year only if the recipient of such assistance certifies to the head of such department or agency that the aggregate expenditure of funds of the recipient, exclusive of Federal funds, for such program or project will be maintained at a level that does not fall below the average level of such expenditure for the preceding 2 fiscal years of the recipient.

SEC. 498. LABOR STANDARDS.

(a) PREVAILING WAGES- The head of a Federal department or agency providing financial assistance with any increase in funds authorized or made available by, or with any increase in obligation authority made available by, this Act (including the amendments made by this Act) shall ensure that laborers and mechanics employed by contractors and subcontractors in construction work financed by such financial assistance will be paid wages not less than those prevailing on similar construction in the locality, as determined by the Secretary of Labor under the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.). The head of the department or

agency shall provide such financial assistance only after being assured that required labor standards will be maintained on the construction work.

(b) WAGE RATES- Wage rates in a collective bargaining agreement negotiated under the Railway Labor Act (45 U.S.C. 151 et seq.) are deemed for purposes of this section to comply with the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.).

SEC. 499. BUY AMERICA.

(a) PREFERENCE- The head of a Federal department or agency may provide financial assistance for a project with any increase in funds authorized or made available by, or with any increase in obligation authority made available by, this title (including the amendments made by this title) only if steel and manufactured goods used in the project are produced in the United States.

(b) WAIVER- The head of a Federal department or agency may waive subsection (a) if the head of the Federal department or agency finds that--

(1) applying subsection (a) would be inconsistent with the public interest;

(2) the steel and goods produced in the United States are not produced in a sufficient and reasonably available amount or are not of a satisfactory quality;

(3) when procuring a facility or equipment with any increase in funds or obligation authority described in subsection (a)--

(A) the cost of components and subcomponents produced in the United States is more than 60 percent of the cost of all components of the facility or equipment; and

(B) final assembly of the facility or equipment has occurred in the United States; or

(4) including domestic material will increase the cost of the overall project by more than 25 percent.

(c) LABOR COSTS- In this section, labor costs involved in final assembly are not included in calculating the cost of components.

TITLE V--ELEMENTARY AND SECONDARY EDUCATION INFRASTRUCTURE

SEC. 501. ELEMENTARY AND SECONDARY EDUCATION INFRASTRUCTURE.

(a) IN GENERAL- The Secretary of Education shall provide $5,000,000,000 in grants to the State and outlying area entities responsible for the financing of education facilities (hereinafter in this section referred to as the `State entity'), on the basis of the same percentage as the State educational agency received of the funds allocated to States and outlying areas through the Department of Education Appropriations Act, 2002 for carrying out part A, title I of the Elementary and Secondary Education Act of 1965, for awarding grants in accordance with subsection (b) to local educational agencies to enable them to make urgent repairs and renovations to public school facilities.

(b) GRANTS-

(1) IN GENERAL- A State entity shall award urgent school renovation grants to local educational agencies under this section on a competitive basis that includes consideration of each local educational agency applicant's--

(A) relative percentage of children from low-income families;

(B) need for school repairs and renovations;

(C) fiscal capacity; and

(D) plans to maintain the facilities repaired or renovated under the grant.

(2) FEDERAL SHARE- The Federal share of the cost of each project assisted by funds made available under this section shall be determined based on the percentage of the local educational agency's attendance that is comprised of children 5 to 17 years of age, inclusive, who are from families with incomes below the poverty line (as defined by the Office of Management and Budget and revised annually in accordance with section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)) applicable to a family of the size involved for the most recent fiscal year for which data satisfactory to the Secretary are available:

If the percentage is:

--The federal share is:

At least 40%

--100%

At least 30% but less than 40%

--90%

At least 20% but less than 30%

--80%

At least 10% but less than 20%

--70%

Less than 10%

--60%.

(3) EXCESS ALLOCATIONS- If, after providing an opportunity to the public and all local educational agencies in the State to comment, consistent with any applicable State and local law specifying how the comments may be received and how the comments may be reviewed by any member of the public, the State entity demonstrates that the amount of the State's allocation exceeds the amount needed to address the needs of the local educational agencies in the State for school repair and renovation under this section--

(A) the State entity shall transfer any excess portion of that allocation to the State educational agency; and

(B) the State educational agency shall allocate 100 percent of those excess funds received under subsection (a) in accordance with section 5312 of the Elementary and Secondary Education Act of 1965 as amended by Public Law 107-110 for activities authorized under section 5331 of the Elementary and Secondary Education Act of 1965 as amended by Public Law 107-110 to be determined by each such local educational agency as part of a local strategy for improving academic achievement.

(c) FUNDS FOR SCHOOL RENOVATIONS-

(1) IN GENERAL- If a local educational agency uses funds for urgent school renovation, then the following provisions shall apply:

(A) Urgent school renovation shall be limited to one or more of the following:

(i) Emergency renovations or repairs to the school facilities only to ensure the health and safety of students and staff.

(ii) School facilities modifications necessary to render school facilities accessible in order to comply with the Americans With Disabilities Act.

(iii) School facilities modifications necessary to render school facilities accessible in order to comply with section 504 of the Rehabilitation Act.

(iv) Upgrades to existing technology.

(v) Asbestos abatement or removal from school facilities.

(vi) Security upgrades.

(2) LIMITATIONS- No funds received under this section for urgent school renovation may be used for--

(A) payment of maintenance costs in connection with any projects constructed in whole or part with Federal funds provided under this section; or

(B) stadiums or other facilities primarily used for athletic contests or exhibitions or other events for which admission is charged to the general public.

SEC. 502. LABOR STANDARDS.

The Secretary of Education shall ensure that laborers and mechanics employed by contractors and subcontractors in construction work financed by this title will be paid wages not less than those prevailing on similar construction in the locality, as determined by the Secretary of Labor under the Act of March 3, 1931 (known as the Davis-Bacon Act; 40 U.S.C. 276a et seq.).

TITLE VI--REVENUE OFFSETS

SEC. 601. TOP INDIVIDUAL INCOME TAX MARGINAL RATE NOT REDUCED BELOW 2003 LEVEL.

(a) IN GENERAL- The table contained in paragraph (2) of section 1(i) of the Internal Revenue Code of 1986 is amended--

(1) by striking `37.6%' and inserting `38.6%', and

(2) by striking `35.0%' and inserting `38.6%'.

(b) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 2003.

SEC. 602. REINSTATEMENT OF ESTATE TAX FOR ESTATE OVER $5,000,000; REPEAL OF CARRYOVER BASIS.

(a) REINSTATEMENT OF ESTATE TAX-

(1) IN GENERAL- Subtitles A and E of title V of the Economic Growth and Tax Relief Reconciliation Act of 2001, and the amendments made by such subtitles, are hereby repealed; and the Internal Revenue Code of 1986 shall be applied as if such subtitles, and amendments, had never been enacted.

(2) SUNSET NOT TO APPLY-

(A) Subsection (a) of section 901 of the Economic Growth and Tax Relief Reconciliation Act of 2001 is amended by striking `this Act' and all that follows and inserting `this Act (other than title V) shall not apply to taxable, plan, or limitation years beginning after December 31, 2010.'.

(B) Subsection (b) of such section 901 is amended by striking `, estates, gifts, and transfers'.

(3) CONFORMING AMENDMENTS- Subsections (d) and (e) of section 511 of the Economic Growth and Tax Relief Reconciliation Act of 2001, and the amendments made by such subsections, are hereby repealed; and the Internal Revenue Code of 1986 shall be applied as if such subsections, and amendments, had never been enacted.

(b) INCREASE IN EXCLUSION EQUIVALENT OF UNIFIED CREDIT TO $5,000,000- Subsection (c) of section 2010 of the Internal Revenue Code of 1986 (relating to applicable credit amount) is amended by striking all that follows `the applicable exclusion amount' and inserting `. For purposes of the preceding sentence, the applicable exclusion amount is $5,000,000.'.

(c) Maximum Estate Tax Rate To Remain at 2003 Level-

(1) IN GENERAL- The table contained in paragraph (1) of section 2001(c) of such Code is amended by striking the 2 highest brackets and inserting a new bracket to read as follows:

`Over $2,000,000

$780,000, plus 49% of the excess over $2,000,000.'.

(2) CONFORMING AMENDMENT- Paragraph (2) of section 2001(c) of such Code is hereby repealed.

(d) EFFECTIVE DATE- The amendments made by this section shall apply to estates of decedents dying, and gifts made, after December 31, 2003.

END