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Records of the White House Office of the Chief of Staff to the President (George H. W. Bush Administration)
James A. Baker III Files
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Originally Processed With FOIA(s):
foia Number:
2000-0715-F
2000-0715-F
FOIA
MARKER
This is not a textual record. This is used as an
administrative marker by the George Bush Presidential
Library Staff.
Record Group/Collection:
George H.W. Bush Presidential Records
Collection/Office of Origin:
Chief of Staff, White House Office of
Series:
Baker, James A., III, Files
Subseries:
Public Correspondence Files
OA/ID Number:
93006
Folder ID Number:
93006-001
Folder Title:
[Public Correspondence] [12]
Stack:
Row:
Section:
Shelf:
Position:
G
0
0
0
0
Royce A. Scott
NRN
Certified Public Accountant
Telephone
P.O. Box 6639
(915) 695-4380
Abilene, Texas 79608
September 17, 1992
Mr. James Baker
The White House
1600 Pennsylvania Avenue
Washington, D. C.
RE: NATIONSGATE
VIA FEDERAL EXPRESS
Dear Mr. Baker:
In all presidential elections 1960, I have voted for the
republican nominee. The re-election of George Bush is in serious
trouble of in Texas because he has allowed the administrative branch
government to destroy our state.
Recently, Mr. Bush made a completely untrue statement. He
said that our government is a government of laws. UNTRUE!. Our
government the is a government of influence. The FDIC gave most of
banking system in Texas to Ross Perot et al dba NCNB. The FDIC
closed 39 solvent First Republic Banks. Then, the FDIC the
assets to Ross Perot et al dba NCNB for NOTHING. FDIC and gave alter
ego, Ross Perot et al dba NCNB proceeded to destroy businesses
throughout our state.
Attached is proof that laws are for some people but not for
Ross Perot et al. Being a certified public accountant, I
know familiar with the process of revenue rulings. As a lawyer, am
first step is the application to the IRS. The second is
that the process of using a revenue ruling is four steps. you The
receiving the revenue ruling. The third step is structuring step the
matter to comply with the revenue ruling. The fourth step is to
letter ruling.
conduct the matter within the terms and conditions of the private
et al dba NCNB is as follows:
A review of the use of the private letter ruling by Ross Perot
Step 1: Information related to the application for the
revenue ruling is including in the ruling. There is massive
misrepresentation! The depositors as owners, the dates, the
owners of the JRB Bank, plans to sell stock, and other items
completely misrepresented the matter.
Step 2 : The private letter has eleven times the conditions
that the successor will assume all the liabilities of the
subsidiary First Republic banks.
4601 Buffalo Gap Road, A-4 Abilene, Texas 79606 Fax (915) 695-0060
Mr. James Baker
The White House
September 17, 1992
Page Two:
Step 3: There was no re-organization. But rather, the FDIC
closed the banks and transferred the assets to JRB ( Ross Perot
et al dba NCNB) for a nominal value not fair market value.
The purchase and assumption agreement does not in any fashion
have any relationship to terms and conditions of the revenue
ruling.
Step 4: In subsequent legal actions throughout Texas, Ross
Perot et al dba NCNB has claimed that D'uench Dhome and
Federal Holding laws eliminated any claims including any
defensive claims. By the sworn testimony and documents, Ross
Perot et al dba NCNB has violated the terms and conditions of
the revenue ruling.
Attached are copies of pages from business publications
showing that Ross Perot et al dba NCNB will benefit to the amount
of over a billion dollars.
Also, attached is information which furnished the violation of
the private letter ruling to the Internal Revenue Service. If
George Bush was correct that this is a nation of laws, THEN, why is
the FDIC and its alter ego, Ross Perot et al dba NCNB not subject
to the laws of our state and nation?
Three reasons for George Bush to recover the billion from Ross
Perot et al dba NCNB are:
1. Because it is morally, ethically, and legally right,
2. Because it would put a billion into the depleted treasury,
3. Because Ross Perot et al should not have the billion.
If George Bush wants loyal republicans in Texas to vote for
him, then, something has to change. A beginning would be to start
hearing the wails of people like me.
Sincerely yours,
Royce A. Scott
P. S. I should receive the award for furnishing the information.
my Home PHONE IS 915-692-9324.
Let's TALK Maaut 1823(E)
Taxpayers
AS
$ 952,000,000
SUBITTED
TO
Former
IRS
Interfirst
IFRB
Banks
JRB
NCNB
NationsBank
Republic
Former
BANK
Texas National Bank
TEXAS, n.a.
Holding
Republic
Banks
Re-Organtenten
NAME CHANGED
Name Change
Assemed Assets and AD Liabilities
AND OWNED BY NCNB
AS PER
P& A
Taxpayers
$ 952,000,000
AND
Former
PLEADINES
Interfirst
IFRB
Banks
FDIC
NCNB
NationsBank
OF
(JRB BANK)
Texas National Bank
TEXAS, n.a.
Republic
Former
NOWB
Holding
Republic
Banks
Banks Closed
Purchase &
Assumption
Name Change
D'uench Dhome
Agreement
Federal Holding
(Does not apply to
Torts, etc.)
EXHIBIT "A"
Index Number: 0368.00-00
Washington, DC 20224
8835057
Person to Contact:
Telephone Number:
Refer Reply to:
CC:C:Br.13-TR-31-2386-88
Date:
In re:
IN 10 1988
Parent
-
Agency
-
Acquiring
.
See GReeN
Bridge
MARKINGS
-
National
#
Exchange
.
State X
=
1
State Y
This c.
=
used or
State z
.
dent. 3:
of Die Jr.
Date 1
=
Date 2
Date 3
-
Date 4
-
Date 5
#
b
.
c
-
d
.
EXHIBIT
"A"
000276
-2-
88350571
TR-31-2386-88
Dear
14H
This is in reply to your authorized representative's letter
dated May 20, 1988, requesting rulings as to the federal income
tax consequences of a contemplated transaction in which several
banks will be combined into one bank. Your representative
8, 1988. The information submitted for consideration is
submitted additional information in letters dated June 3, 7, and
summarized below.
company. Most of its banks are located in State Y. As of Date
Parent is a State X corporation operating as a bank holding
1, Parent had approximately b common shareholders for its c
classes of common stock that were traded on Exchange. Parent
also had d classes of preferred stock issued and outstanding.
In addition, on Date 1 Parent had e subsidiary banks
(hereinafter Subs) which Parent wholly owned either directly or
through an intermediate wholly owned corporation. The deposit
accounts of Subs are insured by Agency.
000277
-3-
8835057
TR-31-2386-88
Agency is a federal corporation responsible for maintaining
safety and public confidence in the banking industry. Agency
fulfills this obligation in part by insuring deposits in its
member banks for up to $f. When it becomes necessary, Agency
meets its insurance obligation by liquidating the bank and paying
the depositors cash or by arranging for another insured bank to
assume the failed bank's deposit liabilities.
In the year ended on Date 1, Parent and its subsidiaries had
book losses of $g. In the three months that ended on Date 2,
Parent reported book losses of $h. These losses threaten theo of
stability of the Subs. To relieve Agency of the necessity of
1
liquidating the Subs and paying their creditors, Agency has
devised a plan to combine the Subs into a new bank which will
the
141
assume the Subs' liabilities. Agency has agreed to transfer
funds as part of the plan. Also as part of the plan, Agency has
negotiated to have Acquiring purchase stock of the new entity.
Acquiring is a State 2 corporation doing business as a bank
whis used dent, use
or Teate !
holding company. As of Date 1, Acquiring had 1 shares of common
dooustri in -
stock issued and outstanding. Another 1 shares of common stock
were reserved for issuance pursuant to certain warrants and
plans. The proposed transaction described in this letter will
allow Acquiring to expand its business into State Y.
Public
Agency and Acquiring have negotiated the following proposed
TOCP
transaction, the first two steps of which have already occurred.
"No DCAL"
(1) On Date 3, Agency transferred a total of $k to the Subs
in return for a note due on Date 4. The note is
secured by the stock of some of the Subs.
(11) On Date 5, Agency and Acquiring signed letters giving
Agency, upon the happening of certain contingencies,
the right to go forward with the transaction with
Acquiring; while Agency had not selected Acquiring,
Acquiring agreed to go forward with the transaction if
satisfied. selected by Agency, provided certain conditions were
BASED
RULINGREVIOUSLY
(111) All of the Subs will be declared insolvent by the
on insolvent
appropriate regulatory authority. Agency will be
appointed their receiver and a court of competent
jurisdiction will confirm that appointment.
(iv)
Agency will form a new corporation, Bridge. All of the
Subs will transfer all of their assets and liabilities
to Bridge.
2
(v) Acquiring will have the right to examine Bridge for L
days. At the end of its examination, Acquiring will
000278
-4-
8835057
TR-31-2386-88
have the right to purchase 100% of Bridge's voting
common stock for $m.
(vi) Agency will transfer $n to Bridge and receive 100% of
Bridge's nonvoting common stock. At the same time,
Acquiring may exercise the right described in (v)
above. Agency's $n, along with Acquiring's $m,
represents amounts required to bring Bridge up to
regulatory minimum capital requirements.
(vii) Agency will grant Acquiring an exclusive five year
option to purchase its nonvoting common stock at a
price described in (x) below.
(viii) During Bridge's existence, Agency will provide
approximately $o in additional assistance. $k of the
assistance will be in the form of forgiveness of the
note described in (1) above or cash that will be used
to repay that note. The $o represents the amount
necessary to eliminate Bridge's negative shareholders'
equity.
(ix) At the end of Bridge's authorized existence, P years
with a possible Я year extension, Bridge will convert
to a nationally chartered bank (hereinafter National).
No
STOCK
National will have the same stock ownership as Bridge.
(x) Within the five year option period, Acquiring may
exercise its right to purchase Bridge or National's
nonvoting common stock for $n plus r% of the net
retained earnings in Bridge and National during the
period in which Agency held the nonvoting common stock.
The following representations have been made concerning the
proposed conversion of Bridge into National:
(a) The fair market value of the National stock and other
consideration received by each Bridge shareholder will
be approximately equal to the fair market value of the
Bridge stock surrendered therefore.
(b) There will not be a UNIROC plan or intention by the
shareholders of Bridge who own 1 percent or more of the
Bridge stock, and to the best of the knowledge of
management of Bridge, there will not be a plan or
intention on the part of the remaining shareholders of
000279
-5-
TR-31-2386-88
8835057
Bridge to sell, exchange or otherwise dispose of any of
the shares of National stock received in the
transaction.
(c) Immediately following consummation of the transaction,
the shareholders of Bridge will own all of the
outstanding National stock and will own such stock
solely by reason of their ownership of Bridge stock
immediately prior to the transaction.
(d) National has no plan or intention to issue additional
shares of its stock following the transaction.
(e) Immediately following consummation of the transaction,
I
National will possess the same assets and liabilities,
3
14K
except for assets distributed to shareholders who
receive cash or other property, assets used to pay
dissenters to the transaction, and assets used to pay
expenses incurred in connection with the transaction,
as those possessed by Bridge immediately prior to the
transaction. These assets and all redemptions and
distributions (except for regular, normal dividends)
made by Bridge immediately preceding the transaction
will, in the aggregate, constitute less than one
percent of the net assets of Bridge. Dissenting
shareholders will own less than one percent of the
Bridge stock.
(f) At the time of the transaction, Bridge will not have
outstanding any warrants, options, convertible
securities, or any other type of right pursuant to
which any person could acquire stock in Bridge with the
exception of Acquiring's option to purchase all of the
nonvoting common stock from Agency.
(g) The liabilities of Bridge assumed by National plus the
4
liabilities, if any, to which the transferred assets
are subject were incurred by Bridge in the ordinary
course of its business and are associated with the
assets transferred.
(h) Following the transaction, National will continue the
historic business of Bridge.
(1) At the time of the transfer from Bridge to National,
Bridge will not be under the jurisdiction of a court in
a Title 11 or similar case within the meaning of
section 368 (a) (3) (A) of the Internal Revenue Code.
0 () 0
-6-
TR-31-2386-88
8835057
Based solely on the information submitted and the
representations set forth above and assuming that Acquiring
exercises its right to purchase Bridge voting common stock at the
end of its L day examination of Bridge, the following rulings are
provided.
Concerning the transfer by Subs of all their assets to
5
14L
Bridge in exchange for Bridge's assumption of their liabilities,
it is held as follows:
(1) The transfer by Subs of all of their assets to Bridge
in exchange for Bridge's assuming the liabilities of
6
Subs will be a reorganization within the meaning of
section 368 (a) (1) (G) of the Code, Under these unique
circumstances and as a result of the Subs' insolvency,
the depositors own, in substance, the entire equity
interest in Subs, and the deposits they have in Subs
will continue in Bridge. Subs and Bridge will all be
"parties to a reorganization" within the meaning of
section 368 (b).
(2) No gain or loss will be recognized by Subs upon their
transfer of assets to Bridge in exchange for the
assumption by Bridge of all the liabilities of Subs
n
(sections 361 (a) and 357 (c) (2) (C))
(3) No gain or loss will be recognized by Bridge on the
receipt the Subs' assets in exchange for Bridge's
8
assumption of all of Subs' liabilities.
(4) The basis of the Subs' assets received by Bridge will
be the same as the basis of those assets in the hands
of Subs immediately prior to the transfer (section
362(b)).
(5) The holding period of Subs' assets acquired by Bridge
will include the period during which the assets were
held by Subs (section 1223(2)).
(6) As provided by section 381 (a) of the Code and section
1.381(a)-1 of the Income Tax Regulations, Bridge will
succeed to and take into account the items of Subs
described in Section 381 (c). These items will be taken
into account by Bridge subject to the provisions and
limitations specified in sections 381 and 383.
(7) As provided by section 381(c) (2) and section
1.381 (c) (2)-1 of the Income Tax Regulations, Bridge
will succeed to and take into account the earnings and
000001
-7
8835057
TR-31-2386-88
Profits, or deficit in earnings and profits, of Subs as
of transaction. the date of the consummation of the proposed
(8) An ownership change as defined in section 382(g) (1)
occurs on Date 5. Section 382(1) (5) will not prevent
the section 382(a) 382 (a) limitation from applying.
(9) No gain or loss will be recognized by Subs' depositors
upon liabilities. Bridge's assumption of the Subs' deposit
it is held as follows:
Concerning the funds transferred to Bridge by Agency,
(10) The funds Agency transferred to certain Subs on Date 3
will be recognized as gross income to the Subs on Date
3. For federal income tax purposes, the note executed
by Subs in exchange for the funds will be disregarded
because at the time Agency took the note, Agency had no
realistic expectation of repayment.
(11) Bridge will recognize income in the amount of funds
Agency provides to Bridge to replace Bridge's negative
shareholders' equity, whether given in cash or notes,
at the time the cash or notes are received. This
amount is currently estimated to be $o, including the
$k Agency provided on Date 3.
(12) If Agency forgives the note described in ruling (18),
Bridge will not recognize income on the discharge of
indebtedness. Likewise, any circular flow of cash that
Agency provides to Bridge so Bridge can repay the note
described in ruling (10) will be disregarded for
federal income tax purposes.
(13) Bridge will not recognize income to the extent of the
$n Agency contributed in return for nonvoting common
stock. Likewise, Bridge will not recognize income to
the extent of the $m Acquiring contributed in return
for voting common stock (section 1032(a)).
(14) Agency will have a $n basis in its Bridge nonvoting
common stock. Acquiring will have a $m basis in its
Bridge voting common stock.
Concerning the transfer of assets and liabilities from
9
Bridge to National and the exchange of Bridge stock for National
stock, it is held as follows:
000282
-8-
8835057
TR-31-2386-88
(15) For federal income tax purposes, the transfer of assets
by Bridge to National in exchange for shares of
National common stock and the assumption by National of
10
the liabilities of Bridge will constitute a mere change
in the identity, form or place of organization of
Bridge and therefore will qualify as A reorganization
within the meaning of section 368 (a) (1) (F) of the
Internal Revenue Code. Bridge and National will each
be a party to a reorganization within the meaning of
section 368(b).
(16) No gain or loss will be recognized to Bridge upon the
for transfer of its assets to National solely in exchange
shares of National stock and the assumption by
11
National of the liabilities of Bridge (sections 361 (a)
and 357 (a)).
(17) The basis of the assets of Bridge in the hands of
National will be the same as the basis of such assets
in the hands of Bridge immediately prior to the
proposed trancaction (section 362 (b)
(18) No gain or loss will be recognized to National upon the
receipt of the assets of Bridge in exchange for shares
of National stock (section 1032(a)).
(19) The holding period of the Bridge assets received by
National will include the period during which such
assets were held by Bridge (section 1223 (2)
(20) No gain or loss will be recognized to the shareholders
exchange for their shares of Bridge stock (section
of Bridge upon the receipt of National stock soley in
354 (a) (1)
(21) The basis of the National stock to be received by the
Bridge shareholders will be the same as the basis of
the Bridge stock surrendered in exchange therefor
(section 358 (a) (1)
(22) The holding period of the National stock to be received
during which Bridge stock surrendered therefor
by the Bridge shareholders will include the period
held, provided that the shares of Bridge stock were was
held as capital assets on the date of the exchange
(section 1223(1)).
(23) As provided by section 381 (c) (2) of the Code and
section 1.381 (c) (2)-1 of the Income Tax Regulations,
000253
-9-
8835057
TR-31-2386-88
National will succeed to and take into account the
earnings and profits of Bridge as of the date of the
transfer. Any deficit in the earnings and profits of
Bridge will be used only to offset the earnings and
profits accumulated after the date of transfer.
(24) National shall be treated, for purposes of section 381,
just as Bridge would have been treated if there had
been no reorganization. Thus, a net operation loss of
National for any taxable year ending after the date of
transfer shall be carried back in accordance with
section 172 (b) in computing the taxable income of
Bridge for a taxable year ending before the date of
transfer (section 381 (b) and section 1.381(b)-1(a) (2)
of the Income Tax Regulations).
No opinion is expressed about the tax treatment of the
transaction under other provisions of the Code and regulations or
about the tax treatment of any conditions existing at the time
of, or effects resulting from, the transaction that are not
specifically covered by the above rulings.
Temporary or final regulations, pertaining to one or more of
the issues addressed in this ruling letter have not yet been
adopted. Therefore, this ruling letter may be modified or
revoked if temporary or final regulations as adopted are
inconsistent with any conclusions herein. See section 16.04 of
Rev. Proc. 88-1 I.R.B. 7, 19. However, when the criteria in
section 16.05 of Rev. Proc. 88-1 are satisfied, a ruling 16 not
revoked or modified retroactively except in rare or unusual
circumstances.
This ruling is directed only to the taxpayer who requested
it. Section 6110(j) (3) of the Code provides that it may not be
used or cited as precedent.
It is important that a copy of this letter be attached to
the federal income tax returns of the taxpayers involved for the
taxable year in which the transaction covered by this letter is
consummated.
Sincerely yours,
Janes Chief, James L. Branch Dahlberg L Dhh 13
Corporation Tax Division
000284
U.S. Ruling Lets NCNB Earn
$2.8 Billion Before Taxes Begin
Tax Shelter On Texas Deal Could Save Bank $1 Billion
By JAY McINTOSH
State Wrther
60/13/89
NCNB Corp. owes its thanks to some tax analysts
The shelter works like a mammoth
at IRS headquarters in Washington.
tax deduction. For the next few
Its thanks, and perhaps as much as a billion dollars.
That's how much the Charlotte banking company
years, it will cover most or all of
could save in federal income tax in the next few years
because of a June 1988 IRS ruling a five-page letter
NCNB Texas' income and quite
that formed the bedrock of NCNB's winning bid in
possibly its non-Texas earnings as
July 1988 for the failed First RenublicBank network
in Texas
well.
The tax break which stems from First Republic
losses before NCNB look over enabled NCNB execu-
tives to outfox the much larger banks that also bid for
normal rates, had to earn $210 million to keep $127.7
First Republic It also cut the cost to federal regula
million.
The profit gains have driven m the price of
193%
tors who use bank fees not 121 money, to engineer
bailouts.
NCNB's stock, which closed Friday at $47.50 For
First Republic's 40 banks nearty doubled NCNB's
example, the stock $ price was $24.25 at the end of
assets to $60 billion, making it the nation's ninth-larg-
June 1988.
est bank after it assumed full ownership of the Texas
NCNB's second-quarter earnings were up 43% over
bank in July. Last week's purchases of savings and
the same quarter last year. Wall Street analysts
loans in Texas and Florida are pushing that ranking
estimate its third-quarter profit, expected to be re-
up to 7th.
ported today, will be up a whopping 64%.
And so far, the Texas trail has led to big bucks for
Analysts expect NCNB's profits to climb another
NCNB.
30% next year.
Earlier this year NCNR estimated the shelter
Whether the company will save all of the $952
would let it carn $2 8 billion before the company paid
million in taxes that would normally be due on $2.8
any taxes Normally, the tax on that much profit
billion in earnings is uncertain. Congress is still
would come 10 about $952 million
tinkering with a tax-law provision that could affect
The shelter works like a mammoth tax deduction.
the total tax bill. though analysis don't expect it to
For the next few years, it will cover most or all of
seriously erode NCNB's tax break
NCNB Texas' income and quite possibly its non-
Industry analysts, bankers and tax lawyers are sure
Texas earnings as well
about one thing The IRS ruling is one of 2 kind
In the first half of this year, NCNB Texas earned
think as a matter of technical 12% law, (the IRS)
$124.6 million before taxes. With its relatively minus-
probably did make 2 mistake." - says Washington tax
cule tax bill, it was able to keep $121 million In
contrast, NCNB Corp.'s other operations, taxed at
See NCNB Page 5A
and 1989 were $235 million. In both years, the
tive July I. 12%), the state of North Can
majority of these lines was supported by fees paid
Utilization of
lina revised the North Carolina Corporation Act
directly by NCNB Corporation to unaffiliated
operating loss
banks.
(the Act). Among the revisions was the deletion of
carryforwards for
Federal funds purchased in the amounts of $28.4
the concept of treasury stock. Accordingly, for
financial reporting
comparability, the amount previously carried as
million on Day. 11. 1990 and $54.9 million on
purposes
(31.4)
treasury stock has been reclassified to cominon
(17.2)
December 11, 1989 were fully secured by invest
Other, net
A.I
stock and surplus for all periods presented. Fur-
6.1
1.9
arent MY writies.
ther. the Act eliminated the requirement for dis-
Effective tax rate
linction between stated value and surplus. While
The effective tax rates in 1990 and 1989 were 21.6%
3.2%
11.4%
On January 2. 1990. the corporation repaid the
$3.20 million note payable to the FDIC which was
outstanding preferred and common shares mill
significantly less than the Federal statutory rate
originally issued in conjunction with the acquisi-
rarry par or stated values, such amounts have
due primarily to the utilization of approximately
finn of NCNB Texas. The note hore interest at the
been combined for balance sheet presentation.
$118.7 million and $88.9 million. respectively. of tax
rate of 8.40 percent and was scheduled to mature
benefits associated with operating loss carryfor-
July 11. 1990
Note 11- Deposits
wards for financial reporting purposes arising pri-
On July 11. 1900. the corporation issued $200
The components of interest expense on deposits
marily from the excess tax bases of net assets of
million of 10.20 percent subordinated notes at par.
for the years ended December 31 were (dollars in
NCNB Texas.
The notes are due on July 15. 2015 and interest is
thousands):
Under the liability method required by SFAS %,
payable semiannually beginning January 15. 1991.
the balance sheets amounts of deferred taxes are
The notes are not redeemable, prior to maturity.
1990
1989
1988
recognized on the temporary differences between
In connection with the completion of the acquisi.
Savings and interest hearing
the bases of assets and liabilities as measured by
tinn of Panmure Gordon & Co. 1211. in 1987. con-
transaction accounts
$1,013,486
8745,584
$323,304
Lax laws and their bases as reported in the finan-
vertible debt was issued. The number of shares
Negotiable CD's and public
cial statements. The principal sources of tempo-
issued upon conversion into NCNB Corporation
funds
738,859
907,827
279,679
rary differences, tax effected as statutory rates, are
remmon stock will be determined based on the
Consumer certificates and
reduced by the unrecognized tax benefits in arriv.
U.S. dollar amount of convertible debt and the
other time deposits
1,001,693
966,223
349,687
ing at the deferred tax asset at Der. 31. Deferred
average closing price, as defined, of NCNH Corpo-
Foreign
209,640
211,004
87,0RA
tax expense or benefit is recognized for the change
ration common stock at the time of conversion.
Total
in deferred tax liabilities or assets between periods,
The indentures covering the parent company's
$2,963,678
$2,830,6.18
$1,039,758
after consideration of the impact of acquisitions.
11½ and 12.65 percent subordinated notes include
On December 31. 1990 and 1989, domestic time
An analysis of deferred taxes is as follows (dollars
provisions for the creation of segregated funds (the
certificates of deposit in denominations of $100,000
in thousands):
"note funds") for certain regulatory purposes and,
or more amounted to $8,192.8 million and $7,740.2
although they are expected to provide a source of
million, respectively. Other domestic time deposits
1990
1989
funds for the payment of the notes, the note funds
in denominations of $100,000 or more amounted to
Tax effects of cumulative
do not constitute security for the notes. The
$405.5 million and $1,439.3 million on December 31.
temporary differences at
amounts designated for the note funds on Decem-
1990 and 1989. respectively. Certificates of deposit
December 31 related Inc
her 31. 1990 and 1989, wrre $79.2 million and $66.7
and other deposits of $100,000 of more of foreign
Excess las hases of assets in
million, respectively. In establishing the note funds,
offices amounted to $2,133.2 million and $2,148.2
Special Asset Division
$(445,247)
$(431,901)
the corporation has agreed that it will have issued
million on December 31, 1990 and 1989. respec-
Tax net operating loss
equity in amounts and by certain dates as speci-
lively.
carryforwards
(192,107)
(251,784)
fied in the indentures. The corporation had issued
Reserve for credit losses
(242,420)
(175,197)
sufficient equity through its dividend reinvestment
Note Noninterest Income and Expense
Equipment lease financing
124,886
138,701
plan to comply with the terms of the indentures
The significant components of noninterest
Depreciation
42,446
32,200
through December 31. 1990. Issuance of equity to
income and expense for the years ended December
Employee retirement benefits
44,899
24,353
satisfy the terms of the indentures could have a
31 are presented below (dollars in thousands):
Other, net
(25,152)
(39,544)
dilutive effect on earnings per common share. The
1990
1989
1988
(602,695)
(703,172)
commitments to issue equity are revocable should
Noninterest Income
Less:
the note issues no longer be considered capital for
Trust fees
regulatory purposes.
$190,367
$169,405
$60,652
Unrecognized Las benefit
526,211
666,694
Service charges OR deposit
Differences in tax rates realized
14,421
The indentures covering the parent company's
(24,932)
senior long-term debt. excluding convertible debt.
accounts
269,924
217,108
100,278
Net deferred tax (asset) at end of
include provisions that limit funded debt. long.
Nondeposit related service
year
(152,063)
(61,410)
term lease commitments, issuance of subsidiary
fees
100,058
$2,442
42,850
Less:
preferred stock, creation of liens upon the property
Bank card income
99,661
77,656
$3,008
Net deferred tax (asset) liability
of the corporation and the payment of dividends.
Investment securities gains
42.392
121,333
16,128
at beginning of year
(61,410)
40,345
Under the most restrictive of the provisions,
Other income
204,649
168,573
95,028
Impact of acquisition of NCNB
approximately $1.4 billion of consolidated undi-
Spec. Asset Div. mgmL fees
47,7.50
24,000
Texas
(110,000)
vided profits were available for payment of divi-
dends on December 11, 1990.
8954,781
$860,517
8369,055
Deferred tax expense (benefit)
Noninterest Expense
recognized
The corporation has acquired bonds sufficient to
$(90,651)
$8.245
meet the sinking fund requirements on its 8½ per-
Personnel
$846,321
$834,566
$366,723
Prior to adoption of SFAS 96 in 1989, the corpo-
cent debentures.
Occupancy. net
196,491
ration computed deferred taxes under the deferred
188,368
83,891
The principal maturities for the next five years
Equipment
method of APB 11. During 1988, the primary com-
186,220
167,796
81,963
ponents of the $3.6 million deferred benefit were
of long term debt outstanding on December 31,
Marketing
70,624
78,994
34,339
1990 were (dollars in thousands):
deferred gains on the sale of real estate $(16.1)
Amortization of intangibles
55,902
39,158
37,575
million and deferred Inan fees and costs $(4.1) mil-
1991
Professional fees
RA,111
82,016
$17,654
J1,314
lion offset by excess tax basis of kians $(R.1) mil-
1992
4.119
General operating
382,748
295,699
143,546
lion and equipment lease financing $(14.9) million.
1993
General administrative and
11,076
Operating loss carryforwards for financial
1994
2,788
miscellaneous
85,111
65,338
JS,353
reporting purposes, totaling $1.5 billion. comprised
1995
52,421
Special Asset Division
of tax carryforwards and temporary differences for
overhead allocation
(23,420)
(60,093)
which tax benefits have not been recognized, expire
Note Shareholders' Equity
as follows (dollars in thousands):
In July 1989. the corporation issued 8,846,770
$1,888,108
81,692,042
$814,806
shares of common stock resulting in proceeds of
Tax Oper.
$409.4 million, net of related costs of issuance. The
Note 13 Income Taxes
Lnss
Temp.
proceeds were used to partially fund the corpora-
Effective Jan. 1, 1989 the corporation provides
Yrs. of Exp.
Carryfunia
Differences
Total
tion's purchase of the remaining $1 percent equity
for income taxes in accordance with Statement of
1993
$65,901
$65,901
interest of NCNB Texas.
Financial Accounting Standards No. 96, Account-
1996-1998
68,897
68,897
On September 22, 1989. the corporation issued
ing for Income Taxes (SFAS 96).
2002
12,054
12,054
5,000,000 shares of common stock for trading on
The components of income tax expense for the
2003
487,065
487,065
the Tokyo Stock Exchange. This issuance resulted
years ended December 31 were (dollars in
2006-2010
874,100
874,100
in proceeds of $245.6 million, net of related costs.
thousands):
After 2010
39,661
39,661
On September 29. 1988, the corporation issued
1990
1989
1988
8565,020
8982,658
1,547,678
$,000,000 shares of Series B Cumulative Perpetual
Statutory rate
Convertible Preferred Stock in a private placement
Current portion -
38%
with a number of institutional investors. The pro-
Federal
91,501
43,457
70,409
Uarcenz. Lax benef
$526,211
ceeds from this offering were used primarily to
State
10,438
13,099
8,557
The tax operating loss carryforwards above
fund the corporation's investment in 20 percent of
Foreign
896
were generated by NCNB Texas prior to August
4,198
2,540
1989. and may only be utilized against future
the equity of NCNB Texas discussed in Note 3.
Each share of preferred stock pays an annual
102,8.15
$0,754
81,506
NCNB Texas taxable income. Temporary differ-
dividend of 8 percent. and is convertible into
Deferred portion - (benefit):
ences above are also primarily attributable to the
acquisition of NCNB Texas and may offset consol-
NCNB Corporation common stock at a price of
Federal
(90,469)
2,458
845
$35.625 per share at the option of the shareholder.
State
(184)
5,787
(2,421)
idated income for financial reporting purposes.
The shares may not be converted prior to October
Foreign
In connection with the establishment in 1988 of
(2,006)
NCNB Texas, the corporation obtained private let.
I, 1992. The shares have no voting rights.
Dividends declared for common and preferred
(90,653)
8,245
(3,582)
ter rulings from the Internal Revenue Service to
the effect that the tax bases of the assets received
stock were as follows (dollars in thousands except
12,182
68,999
77,924
by NCNB Texas from the FDIC as receiver for
per-share amounts):
The corporation's current income tax of $102.8
the subsidiary banks of First Republic Bank Corpo-
Year Ended Dec. 31
million, $60.8 million and $81.5 million for 1990.
ration (the "FRB Banks") will he the same as the
1989 and 1988. respectively. includes amounts com-
1990
FRB Banks' bases in those assets. As a result, to
1989
1988
Common
puted under the regular and alternative minimum
144,529
the extent that the tax bases of assets acquired by
102.30M
80,138
Per share
Lax (AMT) systems and approximates the amount
1.42
NCNB Texas exceeded their book value, the con-
1.10
0.94
Preferred
paid for those years. These amounts reflect the
20,000
20,000
solidated group is able to recognize tax losses
5,100
Per share
utilization of certain current tax benefits associated
4.00
4.00
through charge-offs or disposition of such assets in
1.02
Other shareholders' equity on December 31 is
with NCNB Texas.
excess of amounts recorded for financial reporting
comprised of the following items (dollars in
Deferred expense (benefit) represents the change
purposes.
thousands):
in the deferred tax asset or liability and is further
The corporation's tax position under the alterna-
discussed below.
tive minimum tax system, after considering AMT
1990
1989
A reconciliation of the difference between the
credits, is substantially equivalent to the regular
Restricted stock award
effective tax rates and the federal statutory rate
tax system and discussed above.
plan deferred
for the years ended Dec. 31 is as follows (dollars
compensation
(13,971)
(23,173)
in thousands):
Note Employee Benefits
Excess of cost over mkt.
1990
Retirement benefits - Net pension income for
value of mkt equity
1989
1988
(20,368)
Federal statutory
1990. 1989. and 1988 was $32.1 million, $6.4 million,
securities
and $1.5 million, respectively. For 1990 and 1989,
Foreign currency
(15,433)
rate
34.0%
34.0%
34.0%$8.7 million and $3.3 million, respectively, of the
translation adj.
(4,322)
(3,346)
Increase (decrease) in taxes resulting from:
pension income is attributable to NCNB Texas.
Tax-exempt
$(38,661)
$(41,952)
income
During 1990, the company purchased annuity
(5.7)
(9.5)
(12.3) contracts providing for the payment of benefits to
THREE LEVELS OF FRAUD
FRAUD # 1
The FDIC gave away a banking system worth from one to
two billion. Note, the former Texas American Banks sold for
$ 700 Million.
FRAUD # 2 The stockholders and buyers of stock of NCNB were not told
of the terms and conditions of the revenue ruling. Note:
The C&S Sovran was based upon value with revenue ruling.
FRAUD # 3
The taxpayers are losing about a billion due to the
use of the revenue ruling by NCNB.
SPECIAL
NCNB TEXAS RULING
TAX ANALYSTS
REPORT-
BREAKS NEW GROUND
by William J. Wilkins
and Terrill A. Hyde
22445 M St NW
WASHINGTON, DC
202-663-6000
William J. Wilkins and Terrill A. Hyde are partnera
In the Weshington, D.C. law firm of Wilmer, Culler &
I. Introduction
Pickering. This article erises from their interest in
On September 8, 1980. the tax services first published
practice. corporate texation. an area of their professional
ruling Issued to NCNB Corporation ("NCNB Corp." In
summaries of LTA 8835057, the much-publicized private
In this article, the FDIC's arrangements with
connection with its proposal to take control of the failed
NCNB Corporation to take over the banking opera-
Texas tion. banking operations of First RepublicBank Corpora-
tions of First RepublicBank Corporation is de.
scribed. In all. the FDIC is expected to transfer
about $4 billion, but just under $1 billion as equity.
with the balance as forgiven loans and other credits
The ruling
to the failing Dallas bank. This takeover was pre-
describes I remarkable and
ceded by negotiations with several banks for condi-
novel transaction.
lions under which one of them would be named to
THE AUTHORS
manage the bank and 10 make capital contributions
QUESTION THE REF
10 the bank. The IRS ruled that the takeover amounts
to a G reorganization. The authors Question whether
The ruling. when out together with press reports and
REMARKABLE
the reproanization ruling is technically correct be-
concressional testimony, describes remarkable and
AND NOVEL
ORGANIZATION RULING
cause it relies on treating depositors as owners.
STECHNICALLY CORRECT
They also note that the ruling treats the FDIC
July 29, 1988, 40 banking subsidiaries (the "Texas Banks")
novel transaction. Over the weekend beginning Friday.
TRANSACTION
BECAUSE IT RCLIES
assistance as taxable income despite an earlier
pany") were thrown into receivership, and the Federal
of First RepublicBank Corporation (the "Holding Com-
private ruling to the contrary and disallows the
ON TREA Depositors
receiver for each of them. The FDIC transferred
Deposit Insurance Corporation (the "FDIC") was named
cerryover of operating losses. Even so, the suc-
AS OWNERS.
cessor bank will have high basis #33018 with little
Texas Banks' assets and liabilities to a single new national the
value, and these buill-in losses may sheller sub-
sequent sernings. The authors conclude that the
Texas # a "bridge bank" that currently has no share-
NCNB Texas National Bank ("NCNB Texas"). NCNB
bank, Initially named JRB Bank, N.A., but later renamed
NOTE
IRS has finally moved to resolve some of the tax
Depositors ARE
issues arising in several bank rescues, but they
think that there is sufficient doubt about some
holcers, but is effectively controlled by the FDIC. NCNB
Corp. then began managing NCNB Texas under a man-
CREDITORS
aspects of the ruling as 10 require legislation to
achieve certainly.
NCNB Corp. and the FDIC also have entered into an
agement contract between the FDIC and NCNB Corp.
agreement which provides that, following # three-month
interim period. NCNB Corp. and the FDIC will contribute
Table of Contents
to NCNB Texas in exchange for 20 percent and 80
$210 to $240 million and $840 to $950 million, respectively.
L Introduction
percent in value, respectively. of newly Issued common
1417
II. Background
At any time during the following five-year period, NCNB
stock of NCNB Texas: the FDIC's stock will be nonvoling.
A. Trouble At First RepublicBank
1418
B. FDIC to the Rescue
1418
Corp. has the option to buy the FDIC's stock for
1418
formula price. In addition, the FDIC has agreed to forgive a
C. FDIC Selects NCNB Plan and
ST billion loan it made to the Texas Ba in March and
Seizes Bank
D. The NCNB Plan
1419
10 provide additional loans and outright ants of cash to
E. The Economics of the Deal
1419
NCNB Texas. Sometime before July 1981, NCNB Texas
1420
III. Tax Analysis
bridge bank to a regular national bank.
will be required to change its form of organization from a
A. A "G" In "Unique Circumstances"
1420
And the tax COOSBOURDERS? To summarize the ruling,
B. F Reorganization Analysis
1420
C. Section 382 Analysis
1422
leading to the formation of MEME constituted an
the tax consequences are 08 follows: the mm actions
D. Taxability of FDIC Assistance
1423
from a bridge bank Into a regular national bank will be an
(coroanization: the future conversion of NCNB Texas
1424
IV. Conclusion
1425
F reorgenization; the principal amount of the FDIC loan
was Immediately taxable to the Texas Banks in March
TAX NOTES, September 28, 1988
1417
SPECIAL REPORTS
when the loan was extended and future FDIC assistance
will be taxable when granted: and NCNB Corp.'s obtaining
be a close call, but If It goes the taxpayer's way, the
conditional rights to acquire NCNB Texas stock created
potential is there for enough built-in losses to shelter
billions in income."
a section 382' change of ownership of the Texas Banks
before the FDIC had even decided to accept NCNB
Corp.'s proposals.
II. Background
Press reports claimed that the tax ruling would result in
A. Trouble at First RepublicBank
millions of dollars In tax savings for the FDIC and for
The Holding Company was created in the 1987 com-
NCNB Corp. These tax savings were reportedly A major
bination of the two largest banking companies in Dallas.
factor in the EDIC's conclusion that NCNB Core: pro-
With $33.2 billion in assets as of the end of 1987. the
WRONG.
posal was the least costly alternative for the EDIC among
Holding Company was the largest bank holding company
the proposals it had considered
in Texas, and the largest in the country outside of New
This article will discuss the difficult issues presented
York, Chicago, and California. The Holding Company
and resolved by the ruling, while attempting to flesh out
held 41 operating bank subsidiaries. including the 40
the background of the ruling with facts on the public
Texas Banks.'
record. The ruling. which was requested May 20, 1988
Following a 1987 Holding Company loss of $656.3
and granted June 10. 1988. appears to break new ground
million. the Texas Banks began suffering drastic losses in
in several significant areas, including the continuity of In-
their deposit bases. In January and February 1988. de-
terest requirement for G reorganizations. the section 354
posits dropped by $1.9 billion, including $600 million that
distribution requirement to. G reorganizations. the option
was withdrawn from the Texas Bank in Dallas during a
rules of section 382. and the taxation and timing of in-
single five-day period.
come FDIC. generated by emergency loan assistance from the
B. FDIC to the Rescue
On Tuesday, March 15, the Holding Company con-
firmed that it had requested FDIC assistance to prevent
the collapse of its banking operations. On Thursday,
Tax savings were reportedly a major factor in
March 17, the FDIC loaned $1 billion to 11 of the Texas
the FDIC's conclusion that NCNB Corp.'s pro-
Banks and announced that depositors and creditors of
the Texas Banks would be fully protected. even in excess
posal was the least costly alternative
of the usual $100.000 maximum FDIC deposit guarantee."
The FDIC loan was for a term of six months and carried
an interest rate of one-half percentage point above the
While press reports left the impression that NCNB
six-month Treasury bill rate. Although the FDIC loan was
Corp. has obtained a tax bonanza. it should be noted that
made subordinate to other debts of the borrowing banks.
the ruling takes tough positions in some areas. As noted
It was secured by guarantees and stock piedges. The
above. the ruling declares the FDIC assistance to be fully
Holding Company guaranteed the loan and secured its
taxable. and not excludable as a contribution to capital.
guarantee by pledging the shares of 30 of its banking
thus taking 8 position contrary to an earlier private letter
subsidiaries. Each of the banking subsidiaries of the
ruling.² In addition, the ruling finds a section 382 owner-
ship change quite early in the process. under circum-
stances that seem to eliminate completely any carry-
forward of net operating losses.
Nevertheless. there is real gold in the ruling for NCNB
Corp. and the FDIC, as the prospective owners of NCNB
"An August 1 Wall Street Journal article includes figures
ReAL
Texas. The finding of early taxability of the March FDIC
supplied by First RepublicBank Corp. indicating that nonper-
Good
assistance allows this substantial item to come into in-
forming loans as of July 29. 1988 totaled $5.135 billion. a figure
come before losses are wiped out by the ownership
representing 23.26 percent of total assets. Apcar. Takeover by
NCNB, Aided by $4 Billion From U.S., Doesn't Protect Holders.
For
change. In addition, the finding that the corporate trans-
Wall St. J., Aug. 1, 1988, at 3. COI. 1. The 25 percent threshold test
NCNB
actions are tax-free reorganizations preserves the historic
of section 382(n)(3) provides that built-in losses are not restricted
asset basis, presumably including a high basis in un-
after an ownership change if the amount of the net unrealized
collectible loans and other troubled assets. What is un-
built-in loss does not exceed 25 percent of the value of the
known is whether the tax benefit of this high basis was
corporation's assets (other than cash. cash Items. and marketable
wiped out by the built-in loss rules of section 382(h). or
securities). measured immediately before the ownership change.
whether II survived under the 25 percent threshold rule of
The tax ruling Indicates that the ownership change in this case
occurred at the time NCNB Corp. and the FDIC exchanged
section 382(h)(3)(B). Press reports Indicate that this may
June. certain letters. an event that probably look place in May or early
"Nash, Large Texas Bank 10 Get $1 Billion in Federal Rescue.
N.Y. Times, March 18. 1988. at A1, col. 6: Hearings on the
Condition of the Banking Industry and the FDIC Fund and the
Supervisory and Assistance Activities of the FDIC Before the
House Committee on Banking, Finance and Urban Affairs, 100th
Cong., 2d Sess. (1988) (Testimony of L. William Seldman)
(hereinafter "Seldman Testimony"). D. 30.
'Except where otherwise indicated. section references are to
"Apcar, First RepublicBank Seys 11 Approached Regulators on
the Internal Revenue Code of 1986. as amended.
2. Federally Assisted Bailout, Wall St. J., March 16. 1988, at 3, col.
Hayes. Talking Deals: FDIC's Servy on Bank's Taxes. N.Y.
Times. Aug. 4, 1958, at D2. col. 1.
'id.
of TA 8243025 (July 22. 1982).
Taylor, FDIC Lends First RepublicBank Units $1 Billion Amid
Search for investors. Wall St. J., Mar. 18. 1988. at 3, col. 2.
1418
TAX NOTES, September 28, 1988
Holding Company also guaranteed a portion of the loan,
OF E WIAL REPORTS
with the size of each subsidiary's guarantee depending
acility to meet those obligations Instantly. As a result,
on the size of the subsidiary's equity."
they were all closed. and the FDIC was appointed as their
While the FDIC's action stabilized the deposit situation.
receiver pursuant to applicable state and Federal law."
large losses continued. primarily as 8 result of heavy loan
Using recently granted congressional authority, and
ALL Assets
exposure in the troubled Texas real estate industry. At
following the NCNB plan, the FDIC Immediately caused
the end of March, some analysts were speculating that
the Texas Banks 10 transfer all of their assets and liabilities
the FDIC might be unable to find a candidate to take over
to NCNB Texas.' A bridge bank such as NCNB Texas is
TO NCNB Texas
AND LIABILITIES
a problem as large as the Texas Banks."
chartered as a national bank, but is not subject to certain
By July, however, reports were emerging that several
limitations generally applicable to national banks. A
banks were considering submitting proposals to re-
bridge bank can operate without Issuing any stock, and is
organize the Texas Banks. The banks reported to be
interested included NCNB Corp., Citicorp, and Wells
arrangements can be made."
effectively controlled by the FDIC until alternative equity
Fargo & Co." In fact. NCNB Corp.'s tax ruling reveals
D. The NCNB Plan"
that by June 10. NCNB Corp. and the FDIC had already
NONTING Till
agreed to implement a specific structure in the event the
NCNB Corp. will operate NCNB Texas under a manage-
LATER
FDIC ultimately selected the NCNB plan. The NCNB
ment contract until about the end of October 1988. At
plan. as well as competing plans of other bidders and of
that time. the FDIC will contribute between $840 million
Holding Company management. was worked out in exten-
and $960 million to NCNB Texas in exchange for non-
sive negotiations with the FDIC."
voting common stock representing 80 percent of its
None TO
equity. NCNB Corp. will contribute between $210 million
C. FDIC Selects NCNB Plan and Seizes Bank
and $240 million to NCNB Texas in exchange for 100
FDIC
Late in the afternoon of Friday. July 29. the FDIC set in
percent of its voting common stock representing 20
motion a chain of events that would result in the consoll-
percent of Its equity. While the FDIC has certain consulta-
dation of all of the Texas Banks into a unique corporate
entity, controlled by the FDIC. known as a "bridge bank."
Texas substantially as if it were a subsidiary.
tion and voto rights, NCNB Corp. will manage NCNB
First, the FDIC Board of Directors selected the NCNB
plan as representing "the most effective, most viable, and
least costly approach for preserving existing banking
services in the affected communities and promoting
Some analysts were speculating that the FDIC
stability in the Texas banking system. Next. the FDIC
might be unable to find a candidate to take
notified the Office of the Comptroller of the Currency and
over the problem
the Texas Commissioner of Banking that it would not
renew the $1 billion loan when it matured in September.
and would not provide additional assistance to the Texas
Banks. When the Comptroller declared that the Texas
exerciseable at any time within five years of the first stock
NCNB Corp. has an exclusive. nontransferable option,
Bank in Dallas was no longer a "viable bank," the Federal
Reserve demanded immediate repayment of all of its
loans to the Dallas bank. The Dallas bank. being unable
Texas stock at a formula price." FDIC has the right,
issuance, to purchase some or all of the FDIC's NCNB
to repay the Federal Reserve. then was closed."
it becomes a 20 percent or less shareholder. to put once its
The closing of the Dallas bank caused a default on the
formula price.
remaining minority interest to NCNB Corp. for the same
$1 billion loan. which the FDIC then accelerated. With the
Foic LOST
acceleration of the loan and the calling of the guarantees.
The FDIC will forgive the original $1 billion loan and
will provide additional assistance (expected to be approxi-
more ON
all banking subsidiaries of the Holding Company became
insolvent. because of either their loan obligations, their
mately $2 billion) in the form of cash or notes. The
guarantee obligations, or both. combined with their in-
amount of additional assistance will be the amount ne-
THE GiveAway
capital. after taking into account the equity capital de-
cessary to give NCNB Texas at least six percent primary
scribed above and writedowns of troubled assets.
Plus MORE
Troubled assets will not be split off into a separate
old.: Seidman Testimony, p. 30.
corporation: instead. they will be transferred to a special
ON
"Apcar. String of Losses Seen by First RepublicBank. Wall St.
FRAUD
J., Mar. 31, 1988, at 3. col. 1; Hayes. First RepublicBank Sees a
String of Big Losses. N.Y. Times. Apr. 1, 1988. at D2. Col. 5.
TAX
of First RepublicBank, Wall St. J., July 7. 1988, at 2. col.
"Apcar. Citicorp May Edge Out NCNB in Bids to Join Ballout
"Seidman Supplement. pp. 5-8.
Helyar, Banking World Gives Mixed Reviews 10 NCNB's Bid for 3:
Wells Fargo Team Begins Sizing Up First RepublicBank. Wall St.
pursuant to section 503 of Public Law 100-86. the Competitive 1987,
"12 U.S.C.A. section 1821(i) was enacted August 10.
First RepublicBenk. Wall St. J., July 8. 1988. at 21. col. 2. Apcar,
Equality in Banking Act of 1987.
J., July 13. 1988, at 6. col. 1, Hayes. FDIC Near Decision on
Texas Bank Bailout, N.Y. Times. July B, 1988. at D2. col. 5.
"12 U.S.C.A. section 1821(i). The statute limits the duration of
Banks of First RepublicBank Corporation, Dallas. Texas. by
"Hearings on the FDIC-Assisted Acquisition of the Subsidiary
depositors and the public.
the FDIC determines that the extension is in the best interests of
the bridge bank to two years. subject to & one-year extension if
NCNB Corporation, Charlotte, North Carolina. Before the House
and the Seldman Supplement.
"The description in this section is derived from LTR 8835057
2d Sess. (Aug. 3, 1988) (addendum to testimony of L. William
Committee on Banking, Finance and Urban Affairs, 100th Cong.,
(hereinafter "Seidman Supplement"). p. 5.
Seidman. Chairman. Federal Deposit Insurance Corporation)
specified percentage of the net Increase in NCNB Texas' book a
"The formula price is the FDIC's original Investment plus
"Seidman Supplement. p. 5.
value. The percentage is 115 percent In the first three years. 120
"Seidman Supplement. pp. 5-6.
percent in the fourth year. and 125 percent in the lifth year. After
stock to a third party or in a public offering.
the lause of the live-year option. the FDIC may sell its remaining
TAX NOTES, September 26, 1988
1419
SPECIAL REPORTS
Internal asset pool. This pool will be accounted for
separately from other bank activities. and will be managed
by a special management team under the supervision and
the by NCNB Texas in exchange for capital contributed by
the second step of the transaction-the issuance of stock
direction of the FDIC. Because the performance of these
FDIC and NCNB Corp.
assets directly affects the FDIC's exposure for direct
noted that. despite the difficult task NCNB Corp. faced be in
Before delving into the technical analysis. It should
assistance, It has a special interest in this part of the new
bank's operations.
convincing the Service that the transfer constituted a G
policy problem with treating NCNB Texas as the tax
reorganization, there seems to be no significant
porate successor to the Texas Banks. even If there is cor-
A bridge bank can operate without issuing any
continuity at the shareholder or securityholder level. no If
FDIC stock, and is effectively controlled by the
the practicalities of the situation and the receivership
process had permitted. all 40 of the Texas Banks could
have survived as operating corporations, holding com-
pany's stock interest in the Texas Banks could have been
extinguished through operation of the receivership pro-
E. The Economics of the Deal
cess. and the transaction could have gone forward with
Only $960 million of the approximately $4 billion in
historical entity, possibly through a newly formed holding
NCNB Corp. and the FDIC capitalizing each separate.
capital that the FDIC has agreed to provide to NCNB
Texas will be contributed in exchange for an equity
company. In that instance. there would have been no
interest. The remainder will be in the form of cash grants
and debt forgiveness. The principal reason the FDIC
vived. because the historic business assets would
question that corporate characteristics would have sure
agreed to contributions so disproportionate to those of
NCNB Corp., which is assuming control of NCNB Texas,
Texas. a bridge bank. was simply a practical step that
have moved. Absorption of those assets into NCNB never
was to avert a crisis that would have left the FDIC
exposed to liabilities greater than the cost of the as-
Texas Banks and to provide stability pending a permanent
needed in order to maintain the banking operations of was the
sistance. Accordingly. it could be said that the extra $3
bank statute."
solution. Indeed. that is the explicit purpose of the bridge
billion is being provided In fulfillment of the FDIC's
obligation to assure that depositors and creditors of the
Texas Banks get 100 cents on the dollar for their claims
against those banks. and more broadly, to avert a spread
The most crucial aspect
was the Service's
of problems to other insured institutions. Second. arrang-
ing for an experienced private sector manager to take
determination that the transfer to NCNB Texas
over a troubled bank as an owner creates an Incentive
constituted a G reorganization.
structure that can provide a return to the FDIC that is
superior to the return that could be achieved If the FDIC
ment. kept all of the equity and arranged for contract manage-
In a tax system in which corporate-level characteristics
survive a taxable stock sale or a change of stock
ship through capital contributions. there is no owner- strong
III. Tax Analysis
because the shareholder-level transaction is preceded by
policy reason to wipe out such characteristics simply
4. A 'G' In Unique Circumstances'
ALL OF THE
MASTICAUCIAL Aspect
The most crucial aspect of the NCNB Corp. ruling was
a change in the form or identity of the corporate Owner of
he Service's determination that the transfer to NCNB
where that change is implemented for the explicit
all of the operating assets and liabilities. particularly
Texas constituted a G reorganization. A G reorganization
8 defined as a transfer of assets from one corporation 10
of continuing an historic business that the old corpora- purpose
another in "a Title 11 or similar case" but only If "stock
OPERATING ASSEBILITIES
or securities of the corporation to which the assets are
transferred are distributed in a transaction which qualifies
under section 354, 355, or 356." In finding a G reorganiza-
tion." the Service on the transfer of assets from
APPARENTLY NORD
the Texas Banks to NCNB Texas: it apparently ignored
Srop
"Report of the Senate Committee on Banking. Housing. and
Urban Affairs to Accompany S. 790. the Competitive Equality
22 (1987). For example. the Service might have considered Sess.
Banking Act of 1987, S. Rep. No. 100-19. 100th Cong., 1st
"Saidman Testimony. p. 32.
treating the bridge bank as 8 statutorily created receivership
THE
I.R.C. sections 368(a)(3)(A). (D).
"An FDIC receivership is a "Title 11 or similar case." See
estate similar to an estate in bankrupicy. which does not create 8
new taxable entity. I.R.C. section 1399: Treas. Reg. section
"II should be noted that. if a transaction qualifies as a G
1.641(b). The Service indicated in Notice 88-7, 1988-4 I.R.B. 20.
reorganization. but also as another type of reorganization. or as
8 tax-free incorporation or subsidiary liquidation, G reorgani-
form of entity for insolvent thrifts (known as an interim associa-
that it might consider such an approach with respect to a similar
zation prevails to the exclusion of other characterizations. I.R.C.
lion or "passthrough receivership"). The Notice stated that
section 368(a)(3)(C). If the transaction falls to quality as a 0
transfer to such an entity would not constitute an ownership a
reorganization. however, it apparently could still qualify under
satisfactory. however, inasmuch as the FDIC is not obligated.
change for purposes of section 382. This approach is not wholly
96th Cong., 2d Sess. 31 (1980).
one of the alternative characterizations. See S. Rep. No. 96-1035.
under its bridge bank authority, to transfer all of a failed bank's
assets to the bridge bank.
1420
TAX NOTES, September 28, 1988
tion was disabled from carrying on." In such circum-
SPECIAL REPORTS
of potentially abusive carryovers to section 382, which
lances, it seems more appropriate to leave the policing
tinuity of interest for those imputed reciplents?"
Banks? And are there problems of post-acquisition con-
PROBLEMS
acquired stock of the historic entities.
would have been the policeman if the new owners had
lical or issuance will not be formally required where its
of a distribution, based on the theory that a distribution
It may be possible to get by the technical requirement
Service must feet in emergency bank bailouts. one can
Given that policy background, and the pressure the
PRESSURE
understand why the Service might feel justified in strain-
ing a bit to find that the creation of NCNB Texas qualified
under sections 354, 355. and 356 would seem to be
Nevertheless. the purpose of requiring a distribution 8till.
effect would be no different from standing prac-
STRAWING
as a G reorganization-and some straining did In fact
take place. Instead of discussing the fine points of the
ensure that the stockholders and securityholders of to
the the ruling finds a G reorganization based essentially on
distribution rules or the continuity of interest doctrine.
problem the here Is that the former common stockholder of
relationship with the transferee." The obvious technical
transferor corporation continue the same stock/security the
OBVIOUS TECHNICAL
following sentence: "Under these unique circum-
the stances and as a result of the (Texas Banks I insolvency,
ing in the transaction.
Texas Banks-Holding Company-will receive noth-
PROBCO
in depositors own in substance the salice equity inter-
continue in ¡NCNB Texas)."
ast Line Texas Banksl and the deposits they have will
holders permits Texas Bank depositors to be considered
Assume. however, that the Texas Banks' Insolvency
of the day after the transaction. It still will only be a
transaction, and "distributees" of equity in NCNB Texas the
of equity in the Texas Banks the day before as
There seems to be no significant tax policy
weeks before the FDIC and NCNB Corp. matter
problem with treating NCNB Texas as the
Bank control and put in enough capital to make the assume
depositors plain old cepositors again. Even Texas if
corporate successor
depositors equity few weeks of post-reorganization status the as
the 356, it is questionable whether n $ enough to salisly 355,
and owners would be shough for sections 354,
QUESTIONABLE
Less THAN
knowledges that the depositor-as-owner theory is less ac-
The "unique circumstances" language properly
judicial continuity of interest doctrine" where, as
PERFECT FIT
than 8 perfect fit when it comes to the technicali'ies of
requires a distribution which qualifies under section 354,
G reorganization." For example. section 368(a)(1)(G) a
occurs. because no of the form of the transaction (i.e., no 368(a)(1),
simply characterization under the other provisions of section
"There appear to be serious obstacles to a reorganization
355, or 356. In order to satisfy this requirement. stock
distributed to persons who held STOCK or securities in
securities of NCNB Texas would have to have been or
involvement voting slock is issued to old shareholders. merger
Texas Banks. Even assuming a corporation without the
zation). In of multiple corporations precludes an F and the
holders could be imputed to have made a distribution. share-
whom is the imputed distribution made. and the to
which the preclude G status. it also may preciude D status.
would addition. if the absence of 8 qualifying distribution reorgani-
however, area have that some decisions in the liquidation-reincorporati Note.
statutory distribution requirements are identical. for
distributees holders of stock or securities in the were Texas
between view the creation of Texas of one
could read the technical D requirements broadly. If
section assets
368
bridge banks has been created out of 40 Texas Bank or 40
"If the transaction had involved only a single entity. if
had there would have been an excellent case for an F reorganization, subsidiaries.
term characterization. See I.R.C. section 368(a)(1)(F) (defining # the
Texas the transaction was a section 351 incorporation of would be
that 14.54 (Fifth Ed., 1987). An alternative analysis
Para. income Taxation of Corporations and Shareholders. Eustice.
Federal See Bittker and might be an
the distribution and continuity problems precluded G
form, "reorganization" to include "8 mere change in
with Texas Bank assets. a transaction that would NCNB
effected"). in particular, there is no statutory distribution however
or place of organization of one corporation, identity,
would preserve high basis and built-in losses. Under this theory. also
FDIC) received. In exchange for the assets. stock or receiver, the
(nominally, the Texas Banks. acting through their assets
have to determine that the transferors of the one
cating that a change of ownership following an F reorganization Indi-
Quirement for F reorganizations. and there is authority re-
has change in corporate identify, form, or place of grounds. if
the may not disquality the reorganization on continuity
ties as transaction. this analysis has many of the same nothing
from change. the Because the Texas Bank subsidiaries received ex-
embodying control of NCNB Texas immediately after securities the
independent economic significance. a valid business organization
also pose. and is not a sham. Rev. Rul. 79-250. 1979-2 C.B. 156; pur- see
a reorganization analysis. Note also the potential difficul-
LTR 8807044 (Nov. 23, 1987).
presented by section 351(e)(2). which denies section 351 obstacles
"Investors generally have not been able to work out the
11 ment where stock or securities of a debtor corporation in treat-
issues with the Internal Revenue Service until well after tax
corporation. or similar case are used to satisfy indebtedness of the debtor a Title
uncertainty surrounding the tax consequences of
assistance transaction with the FDIC has been negotiated. The the
Lessinger V. Commissioner. 85 T.C. 824 (1985).
"See James Armour, Inc. V. Commissioner. 43 T.C. 295 (1965);
troubled transactions is a real detriment to attracting new capital assistance for
banks." Seidman Testimony, D. 22.
"Commentators have heretofore generally suggested that
"The Service has been willing to depart from
for actual distribution to stock or security holders is 8 an
and loan 80-105, 1980-1 C.B. 78. in which a mutual circumstances.
See technical Rev. Rul. analysis in Other cases involving unique traditional
was described as having a structure "unique savings
Inst. Asofsky. Reorganizing Insolvent Corporations. 41 at A.
38: Bankrupicy and Insolvency: Tax Aspects and Procedure. T.M.
treatment as a G reorganization. See. e.g., Tatlock, prerequisite 466
business organizations," thus permitting a mutual-to-stock among
supre Fed. at 5-8. Tax. Para. 5.02[1][c]. But see note 27 aupra: Asoleky, N.Y.U.
company had no stockholders.
version to Qualify as an F reorganization even though the mutual con-
nizations. "The continuity of interest requirement applies to G
Rep. H.R. Rep. No. 833. 98th Cong., 2d Sess. 31 (1980): reorge- 8.
No. 1035, 96th Cong., 2d Sees. 36 (1980).
TAX NOTES, September 26, 1988
1421
SPECIAL REPORTS
here, the subsequent infusion of capital and acquisition
of control, albeit subject to contingencies. were planned
at Texas." the time of the transfer from the Texas Banks to NCNB
Interest is concerned.
in the ballpark as far as post-reorganization continuity of
NAGGING
creditor-as-owner theory. whether the owner 13 seen as
Finally, there is a nagging statutory problem with any
Another problem with this analysis is that the Service
WRONG
may have picked the wrong creditor 10 anoint with
The depositor or 85 The FDIC Section 368(a)(3)(D)(ii)
STATUTORY PROBLEM
CREDITOR
equity-owner status. It will be recalled that the FDIC is
provides a specific remedy to the problem of the lack of
the guarantor of deposits up to $100,000 per depositor:
continuity of interest and of a qualifying section 354, 355,
that the FDIC assumed responsibility for full payment of
or 356 distribution." but only for thrift institution reorgani-
all deposits and debts of the Texas Banks. over and
zations meeting fairly specific requirements. As banks
above the $100,000 guarantee: and that the FDIC made a
rather than thrifts, the Texas Banks were not covered by
$1 billion loan to the Texas Banks that was subordinated
this provision." Moreover. Congress based its 1986 repeal
to all other deposit and debt obligations of the Texas
of those provisions in part on the view that they consti-
Banks. When the FDIC look the latter two actions, the run
tuted an exception to normal tax rules. adopted to provide
on Texas Bank deposits stopped, precisely because de.
financial assistance to troubled thrifts. The approach
positors stopped worrying that they might be treated as
taken by the NCNB Texas ruling Implies that, in the
equity owners. Accordingly, even if the depositors were
Service's view, the Initial 1981 enactment of section
under water on July 29, they were standing on the
368(a)(3)(D)(ii) may have been unnecessary. and that its
shoulders of a more completely submerged FDIC
1986 repeal may have been meaningless.
In addition, it seems that the FDIC is the party that
B. F Reorganization Analysis
more aptly compares with the Alabama Asphaltic credi-
tors. assuming "effective command of the property" after
The ruling that future actions to convert NCNB Texas
throwing the Texas Banks into receivership.' In this
from a bridge bank to a regular national bank will be an F
case. the FDIC decisively exercised its considerable
reorganization is relatively straightforward. although the
power as creditor, regulator, and receiver to call all the
possibility of the FDIC's selling off its 80 percent interest
shols. without checking with the depositors or with the
shortly before or after the transaction might raise a
Holding Company. The Service may not. however, have
continuity of interest issue. On this point. it is interesting
regarded the $1 billion March loan as sufficiently long
to note that the ruling includes the recital of a representa-
lion that there was no plan or Intention to sell shares of
DESPITE
term to qualify as a "security."
the newly chartered successor corporation following the
transaction. despite the FDIC's clear plans to sell off its
interest. If not to NCNB Corp., then to another buyer."
The depositor-as-owner theory is less than a
The fact that the reorganization qualifies under section
perfect fit when It comes to the technicalities
of a G reorganization.
If the FDIC is treated as the equity owner under an
Alabama Asphaltic approach. the reorganization analysis
"The Service has stated that "ordinarily. the Service will treat
is at least somewhat more satisfying. Although a technical
five years of unrestricted ownership as a sufficient period" to
is LACKING STILL
distribution of NCNB Texas stock or securities is still
satisly the continuity of Interest requirement. Rev. Rul. 66-23.
1965-1 C.B. 67.
lacking. the planned end-of-October stock issuance
would not divest the FDIC of its equity position. Further-
*I.R.C. section 368(a)(3)(D)(II) provides that 8 transaction will
not fall to quality as a G reorganization "if no stock or securities
more. the fact that the plan contemplates continued FDIC
of the corporation to which the assets are transferred
equity ownership for up to five years seems to be clearly
received or distributed" provided the following requirements are are
satisfied: substantially all the liabilities of the transferor become
liabilities of the transferee immediately after the transfer. the
Federal Home Loan Bank Board or the Federal Savings and
"See McDonald's of Zion. Inc. V. Commissioner. 688 2d 520
Loan Insurance Corporation certifies that the grounds set forth
(7th Cir. 1982): Rev. Rul. 66-23. 1956-1 C.B. 67. Although value.
in 12 U.S.C. sections 1464(d)(6)(A)(i). (H), or (IIi). exist or will
not control. is the measure of continuity (see Nelson Helvering,
exist in the near future in the absence of Board action and the
296 U.S. 374. 377 (1935): Rev. Proc. 77-37. 1977-1 C.B. 558). the
requirements of I.R.C. sections 354(b)(1)(A) and (8) are met.
depositors would no longer have an "equity" interest, but rather
The legislative history of the provision states that If its require-
a creditor's interest. once NCNB Texas was returned to solvency.
ments are satisfied. a transfer will be treated as a G reorganiza-
For the proposition that deposits do not represent a sufficient
tion without regard to the continuity of interest doctrine. See H.
equity interest for continuity of interest purposes outside of 8
Rep. Report). No. 217. 97th Cong., 1st Sess. 283 (1981) (Conference
bankruptcy or receivership context. see Paulsen V. Commis.
sioner. 469 U.S. 131 (1985).
"Section 386(a)(3)(D)(ii) applies only to financial institutions
(1942). "Helvering V. Alabama Asphallic Limestone Co., 315 U.S. 17@
described in I.R.C. section 593. # category which does not
Include banks Banks are delined in section 581. The Senate
"The FDIC has two interests in the receivership estate-as
Finance Committee amendment 10 the Technical Corrections
receiver and as creditor Although its interest as receiver (which
Act of 1968 would extend this provision to failed banks. Baucus
is similar to that of a trustee in bankruptcy) would not count as
and Packwood. Amendment No. 3044. section 794. proposed to
ownership for this purpose. its interest as 8 major creditor of the
receivership estate might count.
be 1988). made to S. 2238. 134 Cong. Rec. 812731, 12751 (Sept. 16.
"There is considerable literature discussing whether short-
"See Staff of the Joint Committee on Taxation, General
term creditors quality 58 security holders for purposes of the G
Explanation of the Tax Reform Act of 1986, 571 (1987).
5-8. reorganization provisions. See. e.g., Asolsky, supre note 29. at
*Seidman Supplement. P. 3. As noted supra at note 24. post-
transaction continuity of Interest may not be a strict requirement
for F reorganizations in all cases.
1422
TAX NOTES. September 26. 1988
SPECIAL REPORTS
368(a)(1)(F) means that the transaction will not terminate
the taxable year of NCNB Texas." This could be valuable
In the ruling. the Service apparently applied the option
in the event of losses from bad debt deductions. which
rules to find that an ownership change" occurred on or
may be carried forward only five years."
before June 10.4' when "[the FDIC) and [NCNB Corp.)
C. Section 382 Analysis
signed letters giving (the FDIC]. upon the happening of
Although the Service extended to bank depositors the
certain contingencies. the right to go forward with the
theory of the statutory provisions treating thrift depositors
transaction with [NCNB Corp.): while (the FDIC] had not
as equityholders for purposes of satisfying the continuity
selected [NCNB Corp.). [NCNB Corp.) agreed to go
of interest requirements for a G reorganization, it did not
forward with the transaction if selected by (the FDIC].
elect to similarly extend the parallel rules treating thrift
provided certain conditions were satisfied." Thus. under
depositors as equityholders for purposes of avoiding an
the letters. if the FDIC chose NCNB Corp. as the winning
Similaely EXTEND
bidder, certain unnamed conditions and contingencies
ownership change under section 382. For this purpose.
the Service looked to the planned issuance of stock to the
still might permit either party to back out; on the other
FDIC and NCNB Corp. and consequently found the
hand, if those conditions and contingencies were met.
occurrence of an ownership change (and limitation of the
each party had the right to force the other 10 perform its
loss carryforwards as of the date of the ownership
obligations under the plan. The Service apparently dis-
DISRECARDED
change) relatively easy to determine. The timing of the
regarded these contingencies and determined that the
ownership change is a more complex question. however,
FDIC and NCNB Corp. had obtained options 10 increase
and turns on the application of the option rules under
their ownership of the Texas Banks by more than 50
percentage points.
section 382.
More
Under the regulations. there is a separate testing with
respect to each class of options and with respect to each
Complex
optionholder: in addition. there is separate testing for
Approach
implies that
each combination of optionholders In this case. there
the
Initial
1981
on-
appear to be three separate options: the right (or obliga-
actment of section 368(a)(3)(D)(II) may have
tion) of the FDIC to acquire newly issued NCNB Texas
been unnecessary, and that its 1986 repeal
nonvoting common stock representing 80 percent of the
may have been meaningless.
equity: the right (or obligation) of NCNB Corp. to acquire
newly issued NCNB Texas voting common stock repre-
senting 20 percent of the equity; and the right of NCNB
Corp. to purchase the FDIC's stock."
Under section 382(1)(3)(A)(iv). an option to acquire
All of these options would be deemed exercised on the
stock is generally treated as exercised if the exercise of
date the letters creating the options were signed, because
the option would result in an ownership change. The
each of them, either alone or in combination with the
term "option" is broadly defined in the temporary regula-
other party's option. created an ownership change.**
tions. For example. under the regulations. a contract to
Accordingly. It should be the case that, if and when any
acquire or sell stock is treated as an option.** In addition,
of the options is actually exercised. such exercise would
disregarded." the extent to which an option is contingent is generally
be disregarded for purposes of creating yet another
ownership change (and yet another loss limitation).
This means that NCNB Texas will not be deemed to
M.R.C. section 381(b).
"The ownership change is apparently with respect to the
"I.R.C. section 172(b)(1)(L)
"I.R.C. sections 382(1)(5)(A) and (F) provide that. in the case
fied in the ruling.
Texas Banks rather than NCNB Texas, although this is unspect-
of a reorganization of a troubled thrift. net operating loss
"June 10 is the date on which the ruling was Issued to NCNB
carryforwards will not be limited if, immediately after the reorga-
occurred. Corp. The ruling states that the unspecified "Date 5" had already
nization, deposits in the troubled thrift represent at least 20
percent of the deposits and shareholders equity of the acquiring
"Treas Reg. section 1.382-2T(h)(4)(i). (ii).
entity. The Senate Finance Committee amendment to the Techni-
"The Service's determination that an option existed on the
cal Corrections Act of 1988 would extend this provision to failed
date NCNB Corp. agreed to go forward with the transaction
banks. Baucus and Packwood. Amendment No. 3044. section
(subject to FDIC approval) raises interesting issues In the
794. proposed to be made to S. 2238, 134 Cong. Rec. S12731,
bankruptcy context. Query whether a similar case could be
12751 (Sept. 16. 1988).
made that a plan of reorganization filed in a Title 11 case is an
"See also section 106(d)(6) of H.R. 4333 (100th Cong., 2d
option (disregarding all contingencies). with the result that net
Sess.). which provides a technical correction to this section to
operating losses are limited as of that date. We understand that
remove any reference to section 318. Under regulations. the
the Service may have this issue under consideration in connec-
determination of whether an option is deemed exercised is made
tion with a ruling request. In a related context. the Service
as of each "lesting date." a term that is defined to include any
recently Issued a ruling (as yet unpublished) treating the filing of
date on which options are transferred by. or to, a live percent
a plan of reorganization as 8 "letter of Intent" for purposes of the
shareholder of the loss corporation (or a person who would be a
transition rules under section 384.
five percent sharsholder if the option were treated as exercised).
"Treas. Reg. section 1.382-2T(h)(4)(vi). If an option is allowed
Treas. Reg. sections 1.382-2T(h)(4), (a)(2)(i).
to lapse, the option is treated as though it had never been Issued,
"Treas. Reg. section 1.382-2T(h)(4)(v).
and the loss corporation may file an amended return claiming
"Treas. Reg. section 1.382-2T(h)(4)(iii).
use of any losses II was precluded from using by the section 382
limitation. Treas. Reg. section 1.382-2T(h)(4)(vii).
TAX NOTES, September 26, 1988
1423
SPECIAL REPORTS
undergo a subsequent ownership change If NCNB Corp.
exercises FDIC. ha options to acquire the stock owned by the
The FDIC Service had previously issued a private ruling treating
The NCNB Corp. ruling also states that the special
savings bank as excludable under section 118.4 Also
assistance payments to a state chartered mutual
Also, REJECTEL
exception in section 382(1)(5) will not apply to preclude a
limitation on loss carryforwards. Under this provision, no
rejected. apparently. was any notion that assistance pay-
ments should be excluded under section 1032 as share-
section 382 limitation applies to an ownership change
holder capital contributions either after the transfer of the
occurring in a Title 11 or similar case if the shareholders
Texas Banks' assets 10 NCNB Texas (when the FDIC
before the ownership change) own (immediately after the
and creditors of the old loss corporation (Immediately
effectively assumed ownership and control) or after the
issuance of stock by NCNB Texas (when the FDIC will
ownership change) 50 percent or more of the stock of the
become an actual shareholder). The Service's conclu-
new loss corporation. Here. as explained above. the
sion may be based on the rationale that the FDIC's
option rules were applied to treat NCNB Corp. as a 100
assistance payments are made in its capacity as Insurer
percent stockholder of the Texas Banks as of the date the
SHOULD NOT
option was created. However, because NCNB Corp. was
and not because it stands to benefit (either as a share-
that date. section 382(1)(5) should not apply.
not 8 shareholder or creditor of the Texas Banks before
payments. holder or third party) as a consequence of making the
to offset income with loss carryforwards is limited to an
After an ownership change. a loss corporation's ability
APPCY
amount determined by multiplying the value of the loss
The Service is beginning to take positions on
a corporation immediately before the ownership change by
prescribed rate of return. Under the facts of this case.
some of the difficult Issues presented by re-
the value of the Texas Banks appears to be zero at the
organizations of troubled banks.
DIFFICULT WOULD BE <0
time of the ownership change. It would be difficult to
justify a positive value in light of the massive FDIC
in assistance being given to eliminate negative equity, and
The second point of interest relating to FDIC financial
nothing for its prior ownership of the Texas Banks.
light of the fact that the Holding Company is receiving
zero." Accordingly, the section 382 limitation also appears to be
characterized as a loan and was secured by stock and was
loan as income at the time it was made even though it
assistance is that the Service treated the $1 billion March
JUSTIFY
the expectations of the FDIC In March may not be
guarantees. This may not be entirely off the mark. While
There may be a question as to the potential
easily conclude from the events of July 29 that the
completely clear from the documentation. one might
PURPOSE
application of section 7507 to FDIC assistance
piedges was not so much to secure the loan as to set
purpose of the elaborate system of guarantees and
payments to falled banks.
chose to press the button."
into the total control of the FDIC whenever the FDIC
an arrangement under which the Texas Banks would fall up
PRess THE
D. Taxability of FDIC Assistance
BUTTON
The final challenge that the ruling presents is whether
the FDIC assistance (other than the up 10 $960 million
enacted I.R.C. section 597. which specifically excludes 1981
8243025 (July 22. 1982). Although Congress In
contributed in exchange for the FDIC's equity interest) is
taxable or is tax free as & contribution to capital, and
Savings and Loan Insurance Corporation assistance from Federal
when any such taxability would arise In the case of
amounts ostensibly loaned. The Service gave two rulings
at clarification of existing law and may have been directed as as a
come. legislative history Indicates the section was intended in-
on this issue. The first provided that the $1 billion March
the avoiding basis reduction under section 362(c) as at clarifying much
loan was taxable to the Texas Banks at the time it
Assistance Payments to Troubled Thrifts." 15 J. Corp. Tax. 217
Savings and Loan Industry: Tax Consequences of Financial the
exclusion from income. See generally Spragens. "Saving
Texas Banks) in exchange for the funds will be dis-
made on the grounds that "the note executed by [the was
(the FDIC) had no realistic expectation of repayment." note.
Corrections Act of 1988 would extend the provision will
The Senate Finance Committee amendment to the Technical 1988.
(1988). Section 597 is scheduled to expire December 31,
regarded because at the time (the FDIC) took the
WITHOUT
OR
The second provided. without analysis or explanation.
30. 1989 and broaden its scope to include FDIC June
that NCNB Texas "will recognize income in the amount
lion payments. Baucus and Packwood. Amendment No. assistance 3044.
of funds (the FDIC) provides to (NCNB Texas) to replace
$12731, 794. 12751 proposed (Sept. to 16. be 1988). made to S. 2238. 134 Cong. Rec. sec.
(NCNB Texas') negative shareholders' equity, whether
received. given in cash or notes, at the time the cash or notes are
able under section 1032
by the FDIC in exchange for its stock interest would be exclud-
"The Service did rule. however, that the amount contributed
These rulings are of Interest for two reasons. The first
"See LTR 8612002 (December 4, 1985).
is the Service 8 apparent rejection of the theory that FDIC
"The consequence of treating the loan as Income at the time It
assistance payments are excludable from income under
are was made is to enable it to be used to offset losses before
section 118 as nonshareholder contributions to capital.
limited by the ownership change under section 382. On they the
would be treated as taxable Income unless post-ownership
other hand. FDIC assistance following the ownership change
sheller the income.
change losses or built-in losses (if they survive) are available to
"Sections 382(a). (b)(1).
"See Corri V. Commissioner. 88 T.C. 435. 445 (1987) ("The
such debt must be viewed as having been discharged").
moment it becomes clear that a debt will never have to be paid,
1424
TAX NOTES, September 26, 1988
BANKERS DIGEST
2nd Class Postage Paid
6440 North Central Expressway, Suite 215
at Dallas, Texas
Dallas, Texas 75206-4103
(USPS 041180)
02/92
ROYCE A SCOTT
AN ADDRESS CHANGE -
DUNDEE PETROLEUM INC
When writing us about your subscription
PO BOX 6639
- PLEASE enclose the address label
ABILENE TX 79608-6639
from your copy of BANKERS DIGEST.
Politics and Banking: One View of Clinton
According to an Associated Press/Wide World story by Robert M. Garsson printed in Banking Week, Arkansas Governor
Bill Clinton has promised to create, if elected president, a nationwide network of community development banks, which
might both compete with and complement established commercial banks.
Clinton has said little about the banking industry's bread-and-butter issues: deposit insurance premiums, capital stan-
Hsng
dards, and the increasing burdens of regulation, but his fascination with community development banks offers clues about
his views on banking. No issue is more important to the Arkansas Governor than creating jobs, and he wants the banking
industry to play a key role in such efforts, according to the story.
Unlike the Bush administration, which adopted a deregulatory stance that appealed to large banks, big securities firms,
and diversified financial services companies, Gov. Clinton wants to foster local action through a network of community-
based institutions. "He believes in small commjnity banks," said Arkansas Banking Commissioner William J. Ford. "Small
business is essential in job creation, and he knows that small businesses are created by small banks."
Ford and others who know the governor say he is likely to prove a determined advocate of community banking and of
rules to force banks to plow money back into the communities from which they take deposits.
William H. Brandon, Jr. who was chairman of the Arkansas Economic Development Commission under Gov. Clinton and
who is in line to become president of the American Bankers Association next year said, "The politician went out of his way
to establish ties to the industry. Through the years he always recognized that banks have a central role in the economy."
TEMPORARY AND
m
a
DISASTER
MODULAR BANKING
SYSTEMS
AGOLSTON CO.
FACILITIES
ASSISTANCE
P.O. BOX 856
SANGER, TX 76266
PROGRAM
817-458-7496
1-800-433-5526
FEDERAL FINANCIAL INSTITUTION EXAMINATION COUNCIL
San Francisco, California
June 19, 1992
Presentation by Royce A. Scott
My name is Royce Scott. I am from Abilene, Texas. In order
to be at this hearing, I have paid for my own airline ticket,
hotel, and meals. Probably, all of the other participantes have
had their expenses paid by a bank, trade association, consumer
association, or a government agency. Additionally, I am probably
the only person who is participating that will not draw a salary
for today. Therefore, I must feel that this meeting is important.
For the first time in my life, I am fearful that we are in danger
of losing our society and our nation. In order for a government to
survive, it is necessary that the governed have confidence in their
government. Today, the confidence in our government is at the very
lowest ebb.
None of the three branches of our national government have the
confidence of the citizens. In various polls, senators and
representatives are rated at the bottom of the list. The public is
constantly bombarded with scandals of banking, sex, and other
misconduct of some of the members of congress. Also at the bottom
of the ratings is the legal profession. Citizens do not view the
judicial system as a remedy of wrongs. Recently, after a jury in
Abilene awarded a judgment against a corporation allied with a
government agency, the judge reversed the decision. I have no
response to the question of people who ask "why have a jury?". The
confidence in the administrative branch of government is so low
that a an unofficial candidate, who the public knows nothing about
or about his views, is leading the polls over the nominees of both
political parties. Even, our citizens who are employees of
government agencies are discouraged. People, especially independent
business persons, are trapped between conflicting laws, rules, and
government agencies. Both congress and the White House have been
powerless to control the ever growing deficit. In our state, the
big excitement for a community is the prospect of being selected
for a new prison. Convicts receive early release because of over
crowded prisons. In addition to violent crimes, white collar crime
has spread through out our society. There is an easy way to be
elected to office. One could simply go to the courthouse and have
his, or her, name changed to NONE OF THE ABOVE. With the new name
on the ballot, the party could win an election by a landslide
without campaigning.
The general public does not understand the difference in the
function and the purpose of the different government agencies. For
example, I doubt if very many of our citizens would have any idea
of the difference between the Federal Reserve System and the
Federal Deposit Insurance Corporation. To the average citizen,
government is government, and banking is banking. Last week, there
was a cartoon in the paper which showed a couple standing in front
of a large building which had a sign of "THE ONLY BANK". The
caption read: "I knew that sooner or later that would happen!".
In Newsweek, there was a picture of about fifteen looters
emerging from a store in the Los Angeles riots. Not a single
person had a look of anger. In fact, all of the looters were
smiles and happiness. Since only about three of the looters were
black, it is doubtful that the looting had anything to do with the
court verdict. Ironically, one of the looters appeared to be an
anglo in a white shirt and tie. What has happened in Los Angeles
is a picture of the nation. From the looters of the streets of Los
Angeles to Wall Street and the streets of Washington, citizens seem
to be unconcerned about what is right or wrong. If we do not
begin to solve the problems of our nation, the future of our nation
lies in the chaos of the Los Angeles riots. If we do not solve the
lack of confidence in congress, judical system, and the
administrative branch of government, our future is anarchy. If we
cannot stop the stress being exerted on our citizens by the various
departments of government and its agencies, our future is anarchy.
First, I feel that we need to define what is a bank. A bank
is four groups of people. One group is the stockholders, who have
received an authority to do business, a bank charter. A second
group is people which we call employees. The third group is called
deposit customers. The fourth group is called loan customers. A
bank is people who should be working together. As a certified
public accountant, I would like to point out that the interest on
the deposits is expense to the bank. And, the interest on the
loans is revenue to the banks. The interest paid by the loan
customers is what covers the building costs, payroll costs, and
other costs. The term Certificate of Deposit conjures up a
completely inaccurate image. A Certificate of Deposit is not a
piece of gold, but rather a CD is simply a loan to a bank. I
cannot understand the logic of why our government has assumed all
the risks to any party or parties who has ten CD's of $ 100,000
each in ten banks and/or savings and loans. I wish that someone
could explain the logic of why depositors of large amount of funds
should be at no risk.
Next, we need to define what is the FDIC. By its own name, we
can ascertain its purpose. The second word of its name is
DEPOSIT.
The FDIC is financially supported by the banks as it is the
protection which provides funds. The big question is who controls
or who does not control the FDIC. In the last five years, we,
citizens in Texas, have learned more about the FDIC. I can assure
you that when the FDIC goes into a community that there is no
consideration for the affect on the people who live and work in the
community. I can assure that when the FDIC goes into a bank, there
is no consideration for the affect on the employees. It does not
matter to the FDIC as to whether or not any or all employees will
become unemployed. When it comes to the loan customers, the matter
is worse. With the loan customers, the FDIC's policy has been
slash and burn. Throughout the state, FDIC has become a four
letter cuss word.
I am a member of an endangered species because I am an
independent businessman. About everyone knows that independent
businesses employ people, develop products, develop innovations,
pay a major share of our taxes, support charities, and are a major
part of the communities. Because of the cost, time requirements,
and emotional affect, independent businesses cannot successfully
raise funds by securities. The prime source of funds for
independent businesses has been the community banks. The
consolidation of banks into a few large banks will further restrict
and destroy the segment of our society which operates independent
businesses. The government policy has been to close smaller banks,
but large banks are "Too Big to Fail".
Loans to independent
businesses are being severely restricted by loan policies of
examiners. For example, examiners classifying a loan on a pickup
because of the fact that the customer, who had an excellent credit
history and had not been late on a payment, worked in the oilfield.
Attached is a list of the banks in Abilene as of January 1,
1985. The list shows the amount of deposits and what has happened
to the bank. You can easily see that about one-third of our
banking system in Abilene has been given to NCNB by the FDIC. NCNB
has been in Abilene for almost four years. However, I do not know
of a single independent business which received a single penny of
a loan from NCNB. A personal example: I had a preferential right
under a contract which resulted in being able to acquire an
additional interest in an oil property at a price below fair market
value. The interest in the oil property had a cash flow which paid
the full acquisition cost and interest in two years. There was no
hope of a loan in Abilene, At a Midland bank, my loan was rejected
because I was not settled with NCNB on my First Republic debt. I
will address the misconduct of NCNB on the matter in a few minutes.
Currently, because of NCNB, I am not receiving a cash flow of about
a $ 15,000 per month. There is an asset which I do not own valued
at over a half a million. Recently, I decided to secure credit
cards through a local banks. In a few days, my applications for
new bank credit cards were approved for a considerable limits on
each card. Recently, NCNB has begun to purchase residential loans
in the Abilene area. It was not long ago that the interest rate on
my home was less than the interest rate which the savings and loan
was paying on deposits. The savings and loan had a negative
interest factor before overhead. Are problems being set up for the
future by allowing banks to invest in long term low interest rate
loans on real estate?
Are you familiar with the D'uench Dhome and the Federal
Holding Laws? Five years ago, most lawyers, bankers, and persons
doing business with banks were not familiar with the case. Section
1823 (e) is an impossible law. Under section 1823 (e) unless four
requirements of an agreement are met, the FDIC is not bound by the
agreement of the failed bank. The first requirement is in writing.
The second requirement contemporaneously is a vague and unknown
matter. The third requirement of the agreeement having been
recorded in the minutes of the loan committee or board is
impossible. This sub-section makes customers and creditors of a
bank responsible for maintaining and keeping the minutes of which
they have no access or control. The fourth requirement is that the
agreement is maintained continuously in the files of the bank.
Again, it is impossible for the other parties. Customers,
creditors, and other third parties do not having access or control
over the files of the bank.
I propose a solution to the chaos. I suggest a registry which
would be similar to the filings of UCC. A form would contain the
bank name, the bank number, the name of the party, the party's
number at the bank, the federal identification number of the party,
the date of the agreement, and the type of the agreement. The
register would give the filing a number and date the receipt of the
form. Thereby, bank examiners would be able to secure a printout
of all agreements since the last examination. The bank examiners
would have the ability to secure information of agreements of
customers with other banks. The customers and other parties would
be able to be assured that the FDIC and other parties would be
obligated to such agreements.
After a number of years of abuse, we, the former customers of
failed banks, have hope. A recent court decision by the fifth
circuit should reduce the abuse by FDIC and its alter-ego, NCNB.
After, reading the Westlaw printout on the case, it is my
understanding that a Republic Bank in the Houston area accelerated
a loan. Then, the bank dumped the inventory which was collateral
for below the fair market value. The customer had sued the bank.
Then, the FDIC and its alter-ego, NCNB, came thundering in to town
riding on their elephants. There is nothing morally right about
FDIC and its alter-ego, NCNB, demanding payment of the notes
without giving credit for the value of the inventory. There is
nothing ethically right about FDIC and its alter-ego, NCNB,
demanding payment without consideration for damages which had been
done by the failed bank. There is nothing morally or ethically
right about FDIC and its alter-ego, NCNB, refusing to accept rights
which customers have under state and federal law. Recently, I was
chatting with a judge as we walked out of a courthouse. He
commented that the problem with FDIC/NCNB was that they try to make
their rules as they go.
Various papers which have been filed in the matter of the
closing of the First Republic banks present a picture of chaos and
deceit. In an article in Fortune magazine, the chief officer of
NCNB stated that NCNB had paid ZERO for the First Republic Banks.
Apparently, only two of the First Republic Banks were insolvent
except for the call of the guarantee of the Dallas bank loans from
the agency. The guarantees which were forced on the subsidiary
banks violated both federal and state laws. One of the solvent
banks which was closed was the First Republic Bank Abilene, n. a.
(pka Interfirst Bank Abilene, n.a.) The assets of the bank in
Abilene were transferred to JRB Bank The name of JRB Bank was
changed to NCNB Texas National Bank. Apparently, FDIC never
received any payment for the hard assets such as desks, computers,
file cabinets, etc. The goodwill and trust departments were given
to NCNB without receiving compensation for the value. Then, the
FDIC gave a sweetheart contract to NCNB regarding the outstanding
loans. If the bank in Abilene had not been closed, a major part of
the loan portfolio would have been collected through standard
banking operations. Good customers with good loans became problems
because of the actions of FDIC and is alter-ego, NCNB. The
contract provided that NCNB could charge its so called expenses to
FDIC. Then, NCNB was allowed to keep a part of the collections.
What was probably the largest oil and gas loan portfolio was given
to a bank who had NO guidelines or experience in determining the
value of oil and gas collateral. The experience level of loan
officers assigned to accounts was far below an acceptable level.
As a result throughout our state, businesses have been destroyed,
employees have lost their jobs, and values of real estate have been
sharply reduced. Now, the decline in real estate values has spread
to other states. As a result, the decline of real estate values
has endangered banks, insurance companies and other entities
throughout our nation.
The looting in the Los Angeles riots was dramatic and
televised on a national basis. However, the looting of the
taxpayers in the closing of banks and savings and loan and
giveaways has not be dramatic nor televised on a national basis.
The loss of lives in the Los Angeles riots was dramatic because of
deaths and injuries from gunshots, fires, and other highly visible
means. To the contrary the loss of lives and the injuries in the
looting and riots of the banking system in Texas has not been
dramatic as heart attacks, nervous breakdowns, and other causes are
not so visible.
The giveaway of the largest banking system in the state
included an additional giveaway of an estimated billion dollars of
tax refund to NCNB. According to the revenue ruling which is
attached, the FDIC and NCNB completely misrepresented the
transaction to the Internal Revenue Service. As someone who has
worked with IRS, I know that this does not represent the work of
the IRS. The information presented to the IRS was that the matter
was a reorganization of the First Republic Bank. On that basis,
the IRS issued its ruling. In the ruling, the IRS makes nine
statements relating to the successors assuming the liabilities of
the subsidiary banks of First Republic. In numerous ways including
numerous court actions, NCNB has refused to accept any of the
liabilities other than deposits. NCNB has claimed that D'uench
Dhome and Federal Holding laws insulate them from even defensive
claims. For a revenue ruling to have a value, the transaction must
agree with the ruling. Attached is a copy of the Purchase and
Assumption Agreement of the Abilene bank. It is obvious that the
same agreement was used on the various First Republic banks. It
does not take any legal or tax training or experience to easily
determine that the revenue ruling and the Purchase and Assumption
Agreements do not agree. NCNB has fought to try to keep this
information out of the hands and eyes of the citizens who are
paying the taxes for this giveaway. The answer as to why the FDIC
gave the banks to NCNB rather than sell to banks such as Wells
Fargo may be in the July 30, 1988 issue of the Dallas Morning News.
The headlines were "PEROT AIDS NCNB BID TO ACQUIRE FIRST REPUBLIC".
What has FDIC gained by closing the solvent bank in Abilene?
Probably, the closing has resulted in losses due to loans which
would have been collectible. Losses due to additional expenses
paid to NCNB. The building which First Republic occupied was owned
by a partnership of which the bank was a partner. The partnership
had secured a loan on the building from a savings and loan in
Dallas. After NCNB moved out to the location of the second bank
which they acquired, the building was re-possessed. As a result of
the closing of the savings and loan, FDIC owns the mostly vacant
building. There are other interesting factors. The stock of NCNB
doubled upon being given the First Republic banks. The banks in
Texas were about twice the size of the bank in the Carolinas.
Since the First Republic acquisitions, NCNB has been given numerous
banks and savings and loans plus numerous contracts for the
outstanding loans.
After NCNB assumed the control of my loans, I have had four
different officers assigned to the account. The first officer and
I. had a settlement. When my wife and I drove for two and half
hours to an appointment with the second officer, he refused to
discuss the matter. The third officer found a number of run
checks which had been lost by NCNB. The third officer began to
furnish information which I need for my records and tax returns.
The fourth officer was impossible. Now, the supervisor has left the
bank; therefore, we must again "re-invent the wheel". NCNB/FDIC
filed a lawsuit probably because the notes were within three days
of the statue of limitations. NCNB has tried to repossess property
of which NCNB had issued a release of the deed of trust and
received the proceeds. NCNB has taken me through two court
hearings regarding production of documents which I believe were
shredded by NCNB. I have a letter from the legal department of the
FDIC that a "volume" of my files have been lost. It is interesting
that employees who have left NCNB have gone into the business of
buying notes from NCNB.
In summary, I would like to see five changes. First, I would
like to see 1823 (e) replaced with a registry system. Second, I
would like to see funds made available for independent businesses.
Third, I would like to see the IRS recover the billion dollars of
taxes from NCNB. Fourth, I would like to see a congressional
investigation of the FDIC/NCNB relationship and actions. Fifth, I
would like to see terms of the FDIC Act implemented. The act
requires a maximizing of present value of assets and a minimizing
of losses. The minimizing of losses should include any losses of
communities, businesses, employees of banks, and loan customers.
FEDERAL
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value we allow is $25,000 unless your package contains items of
"extraordinary value, in which case the highest declared value we
allow is $500 Items of "extracrdinary value," include artwork,
Part 137204/137205
Rev. 2/92
NRN
NATIONAL CONFERENCE OF STATE LEGISLATURES
444 NORTH CAPITOL STREET, N.W. SUITE 515 WASHINGTON, D.C. 20001
202-624-5400 FAX: 202-737-1069
PAUL BUD BURKE
PRESIDENT OF THE SENATE
KANSAS
PRESIDENT, NCSL
TERRY C. ANDERSON
DIRECTOR
LEGISLATIVE RESEARCH COUNCIL
SOUTH DAKOTA
September 14, 1992
STAFF CHAIR, NCSL
WILLIAM POUND
EXECUTIVE DIRECTOR
The Honorable Jim Baker
Chief of Staff
The White House
Washington, D.C. 20500
Dear Mr. Baker:
Thank you for your recent interest in mandates. Enclosed please find a
complimentary copy of the National Conference of State Legislatures' (NCSL) most
recent Mandate Monitor.
We have taken the liberty of putting you on our mailing list to receive complimentary
copies of the Mandate Monitor which is published 10 to 12 times a year.
If you have any questions, please feel free to contact me at (202) 624-8695.
Sincerely,
Chustine Work
Christine Wnuk
Fiscal Policy Associate
CW/mbb
Enclosure
NATIONAL CONFERENCE OF STATE LEGISLATURES
CHRISTINE WNUK
FISCAL POLICY ASSOCIATE
444 NORTH CAPITOLSTREET, NW SUITE WASHINGTON, DC 20001
202-624-5400 FAX: 202-737-1069
Denver Office:
1560 BROADWAY
SUITE 700
DENVER, COLORADO 80202
303-830-2200
FAX: 303-863-8003
Hall of the States Mandate Monitor
Mandate Watch List
Revenue Act of 1992
HR 11, sponsored by Representative Rostenkowski (D-Illinois)
Passed in House July 2.
On July 2, the House of Representatives adopted the Revenue Act of 1992 (HR 11). This
measure provides $5 billion in urban aid and contains $12 billion in tax and program-
matic modifications. One provision would potentially create costly litigation against
states. This amendment to Title XI of the Social Security Act would grant a Social
Security Act beneficiary a right to sue a state in federal court under Section 1983 to
enforce state plan requirements. States could be sued regardless of the lack of federal
regulatory guidance and funding. This amendment would reverse the Suter V. Artist
M. Supreme Court decision of March 25, 1992, which ruled in favor of the states.
This amendment pertains to all programs authorized by the Social Security Act for
which state plans are required. Examples of such programs include the foster care, child
welfare, AFDC, Medicaid, child care and development block grant, social services block
grant and child support enforcement.
Fiscal Accountability and Impact Reform Act (FAIR)
HR 5545, sponsored by Representative James Moran (D-Virginia)
Introduced July 2, 1992.
The Hall of the States Mandate
Monitor is a database that
Mandate and Community Assistance Reform Act
records the changing status of
legislation containing federal
HR 5591, sponsored by Representative Frank Horton (R-New York)
mandates on state and local goo-
ernment. The Mandate Watch
Introduced July 9, 1992.
List alerts readers to particu-
larly threatening legislation
under active consideration.
These bills add to the legion of mandate relief legislation that has been introduced in the
102nd Congress. Currently, there are 20 such bills on the Mandate Monitor. Fourteen
The Monitor and the Watch List
are maintained by NCSI and
of these bills contain general relief provisions, such as tightening the requirements for
are issued 10 to 12 times a year
cost estimates as required by the Congressional Budget Act of 1974, calling for a point
depending upon federal action.
of order when an unfunded mandate is debated on the floor, and providing for funding
Inquiries should be directed to:
of all mandates to states or not holding states responsible for the implementation of the
Christine Wnuk
National Conference of State
unfunded mandate. Two bills pertain to pre-emption clarification. Four bills address
Legislatures
specific issues, such as the repeal of penalties with respect to grants to states for safety
444 North Capitol St., NW
belt and motorcycle helmet traffic safety programs as directed in recent public law.
Suite 500
Washington, D.C. 20001
(202) 624-8695
Title I of Representative Moran's bill responds to the Congressional need for informa-
tion on the effect of legislative initiatives on public and private resources. Title I focuses
Subscriptions to the Monitor
on the compliance and implementation burdens imposed on state and local govern-
and Watch List can be
purchased for $35 a year by
ments by federal programs, and the impact of federal programs on productivity,
calling the Marketing
economic growth, creation of jobs and international competitiveness. Title II of the bill
Department at 303/830-2200.
ISSN #1057-7025
Watch List continues on reverse side
National Conference of State Legislatures
July 1992
Hall of the States Mandate Monitor
Watch List Continues
requires federal agencies to consider the economic impact of their actions on utilization of
public and private resources and to select options that have the least adverse economic
consequence. Representative Horton's bill establishes a commission to review, consolidate,
and eliminate certain mandates. This bill closes a loophole in the Congressional Budget Act
of 1974 that enables unfunded mandates to be included in legislation in the absence of Con-
gressional Budget Office estimates of their impact on states and localities. Other amendments
require that a cost estimate accompany the conference report of legislation to ensure that any
major changes made on the floor or in conference will be reported and require committees to
include in their directions to the conference committees the total cost of their provision to all
levels of government. Requirements for cost estimates for agency regulations are strength-
ened as well.
Family Preservation and Mickey Leland Hunger Act
HR 3603, sponsored by Representative Downey (D-New York)
Reported by Ways & Means amended July 2.
The Family Preservation and Mickey Leland Hunger Act, HR 3603, was reported by Ways &
Means on July 2. In the course of the markup, the provision requiring all states to operate the
AFDC emergency assistance program, with half the resources earmarked for homelessness
prevention, was removed. According to the U.S. Department of Health and Human Services,
26 states, Puerto Rico and the Virgin Islands currently have this program.
Appropriations Update
The House Appropriations Subcommittee on Labor/HHS/Education recently eliminated
federal reimbursement to states for cash and medical assistance for refugee resettlement.
Instead, the subcommittee, legislating on an appropriations measure, provided direct assis-
tance for a private program run by voluntary agencies. States will still have to fund refugee
services through AFDC, general assistance, Medicaid, and indigent health services.
Mandate Removed
After careful consideration, HR 159, a transportation bill, has been removed from the
Monitor. This bill changes the minimum apportionment for highway funds from 90
percent to at least 100 percent of the estimated tax payments paid into the highway trust
fund by a state.
Mandate Monitor Takes a Recess
Note to readers: Due to the Congressional recess, the Mandate Monitor will not be
published in August. Look for the next issue in September.
National Conference of State Legislatures
Page Two
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Bill
Program
Bill/Reg.
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
AGRICULTURE
BANKING
S1461
Levin
Deposit Insurance Protection
Requires states whose state chartered financial Institutions cause
7/11/91 Banking, Housing & Urban Affairs
Act of 1991
disproportionate federal Insur. losses, due to Inadequate state regs.,
to pay an Insur. premium as a condition of future deposit Insurance.
HR6
Gonzalez
Financial Institution Safety and
Restricts activities of state banks and their subsidiaries to the activities
Parts of HR 6 were Incorporated Into
Consumer Choice Act
of nat'l banks, unless the FDIC has determined that the activities pose no
P.L. 102-242, "Federal Deposit Insurance Corp.
significant risk to the Insurance fund.
Improvement Act of 1991"
HR4158
Lowey
Would prohibit grants under the community development block grant prg.
2/4/92 Banking, Finance & Urban Affairs
to communities that fall to enforce laws preventing the use or threat
of force against Individuals for exercise of abortion rights.
HR4170
Vento/Wylle
Interstate Banking Efficiency
After 18 months, full interstate banking is allowed. After 3 years, full
6/25/92 Hearings held by Banking, Finance &
Interstate branching is allowed. During the 3 year window, states may
Urban Affairs, Subcmite, on Financial
Act of 1992
opt-in or opt-out of Interstate branching.
Institutions Supervision, Regulation
& Insurance
6/30/92 Hearings completed
HR4202
Hoagland/
Nationwide Banking and
Interstate banking Immediately. After 2 yrs., states may branch interstate.
2/7/92 Banking, Finance & Urban Affairs
McCollum
Branching Act of 1992
Within the 2 year window, states may opt-out of interstate branching.
HR4477
Lowey
Reproductive Freedom
Would prohibit grants under the community development block grant
3/17/92 Banking, Finance & Urban Affairs
Protection Act
program to communities that fall to adopt a policy of
enforcing laws that prevent the use or threat of force against
Individuals for the exercise of abortion rights.
HR4792
Mink
Earthquake and Volcanic
States declared earthquake or volcanic eruption prone shall submit
4/7/92 1. Science, Space & Technology
Eruption Hazard Reduction
certification to the Director of the Federal Emergency Management
2. Banking, Finance & Urban Affairs
Act
Agency stating whether the state has adopted and is enforcing
mitigation measures under the loss-reduction criteria. Funds would
be available to promote compliance. After 2 years, no federally
related mortgage loan could be made or extended unless the
property is covered by earthquake and volcanic eruption Insurance.
If a state is found to be non-compliant, each Federal agency
responsible for Insuring any banks or savings and loans shall prohibit
such Institution from making or renewing a Federally related
mortgage loan secured by improved real estate or a mobile home
located or to be located In an earthquake or volcanic eruption prone
area.
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 1
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
S2207
Dodd
Interstate Banking and
After 1 yr., full interstate banking by acquisition is allowed (de novo after
2/6/92 Banking, Housing & Urban Affairs
Branching Act of 1992
2 years). Consolidation of existing multistate bank operations can occur
after 18 months. After 3 yrs., banks may branch interstate. States have 2
years to opt-out of interstate branching. If a state opts-in during those 3
years, it may prohibit de novo entry for 5 years.
S2217
Dole
Title IV of the Economic
Authorizes full nationwide banking and branching for state and nat'l
2/7/92 Finance
Growth Act
banks as well as foreign banks. No state may prohibit the entry of
out-of-state banks or branches.
S2334
Wirth
Extends the statute of limitations applicable to civil actions brought
3/10/92 Banking, Housing & Urban Affairs
by the Federal conservator or receiver of a failed depository institution
from 3 to 5 years.
S2533
Inouye
Earthquake and Volcanic
States declared earthquake or volcanic eruption prone shall submit
4/7/92 Commerce, Science & Transportation
Eruption Hazard Reduction
certification to the Director of the Federal Emergency Management
Act
Agency stating whether the state has adopted and is enforcing
mitigation measures under the loss-reduction criteria. Funds would
be available to promote compliance. After 2 years, no federally
related mortgage loan could be made or extended unless the
property is covered by earthquake and volcanic eruption insurance.
If a state is found to be non-compliant, each Federal agency
responsible for insuring any banks or savings and loans shall prohibit
such institution from making or renewing a Federally related
mortgage loan secured by improved real estate or a mobile home
located or to be located in an earthquake or volcanic eruption prone
area.
S2776
Bryan
Consumer Reporting Reform
Provides some federal protection of consumers whose reputations have
5/21/92 Banking, Housing & Urban Affairs
Act of 1992
been damaged by false or inaccurate reports. States would be barred
from enacting privacy or consumer protection legislation with
stricter requirements than those provided in 6 separate areas of
Federal law.
HR1171
Wolpe
Would req. states in which the failure of state savings associations
2/28/91 Banking, Finance & Urban Affairs
has involved a disproportionately large share of the thrift resolution
costs, including costs incurred by the Resolution Trust Corporation,
to pay a state thrift deposit insurance premium as a condition of future
federal deposit insurance.
COMMERCE
HR3596
Torres
Consumer Credit Reporting
States would be excluded from regulating the credit reporting industry
6/18/92 Favorably reported by House
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 2
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
(amends.)
Act of 1991
except to enforce federal credit reporting laws.
Banking Cmte.
HR5136
Carper
Atlantic State Coastal
Atlantic Commission would prepare interstate fishery mngt. plan.
5/12/92 Merchant Marines & Fisheries
Fishery Management
States that are selected shall prepare a state implementation plan and
Improvement Act of 1992
submit to Atlantic Commission for approval. States without approved
plans or that fail to enforce mngt. programs could lose aid connected
with this act and the Anadromous Fish Conservation Act and will lose
certain fishing rights. This bill also establishes data reporting
procedures. Funding under this Act will be terminated if states do
not adhere to standards.
S640
Kasten
Product Liability Fairness
Legislation to govern any civil action brought against a manufacturer
5/14/92 Language of S640 was incorporated
Act
or product seller for harm caused by a product. Pre-empts state
into amendment during Senate consideration of
law to the extent that it establishes a rule of law applicable
S250; amendment rejected on May 14, 1992
to recovery in such actions. When a rule of law is not established
by legislature, the Issue is left applicable to state law.
S955
Cohen
State Thrift Deposit Insurance
Would require states In which the failure of states savings & loans
11/26/91 Committee hearings held
Premium Act of 1991
has Involved a disproportionately large share of the thrift
resolution costs, including costs incurred by the RTC,
to pay a state thrift deposit Insurance premium as a condition
of future federal deposit insurance.
S2538
Hollings
Consumer Seafood Safety
Each shellfish producing state must submit a state shellfish
4/7/92 Commerce, Science & Transportation
Act of 1992
safety program plan. This plan must provide for certification of
6/30/92 Hearings held by Commerce,
shellfish shippers. Grants may be available for up to 60% of
Science & Transportation
operating costs.
S2863
Dodd
Toy Injury Reduction Act
Pre-empts state authority to pass legislation pertaining to the
6/17/92 Commerce, Science & Transportation
labeling of certain toys and games.
HR2003
Leach
Depositor Protection Act
Would require the deposits of all state chartered banks, savings
4/23/91 Banking & Finance
of 1991
associations, and credit unions to be federally Insured by the end
of a two year phase-in period.
HR4900
Dingell
Federal Insurance
Explicitly prohibit states from "discriminating" against Federally
4/9/92 Energy & Commerce
Solvency Act of 1992
certified insurers in taxation, ratemaking, or other regulatory
activity. States would be prohibited from imposing barriers to
the withdrawal of an insurer from either a line of business or
from all business in a state. Establishes a self-regulatory
organization that would allow agents and brokers to
opt-out of state regulatory requirements.
COMMUNICATIONS
S12
Danforth
Cable Television Consumer
Would require coverage of local news on cable television
1/31/92 Measure, as amended, passed Senate
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 3
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
Protection Act of 1991
& restore the right of local regulatory authorities to regulate
4/8/92 Approved by House Energy & Commerce,
cable television.
Subcmte. on Telecommunications, 17-7.
EDUCATION
S2
Kennedy
Strengthening Education for
Certain requirements to be met by Including state plans to qualify.
1/28/92 Measure, as amended, passed Senate
American Families Act
S1150
Pell
Would require states to have stringent requirements for
6/11/92 Conference held
Student Loan Programs.
6/16/92 Conferees agreed to file report
6/30/92 Passed in Senate
7/8/92 Conference report agreed to in House
by yea-nay vote: 419-7
7/8/92 Measure now cleared for President
S1503
Nunn
Would provide more stringent reqs. for the Student Loan Program Incl.
2/20/92, Provisions incorporated in S1150
uniform minimum standards for granting licenses to proprietary schools
and places the authority to grant approval in one agency In each state.
HR751
Sawyer
National Literacy Act
Would require states to develop Indicators of program quality,
3/19/91 Passed In House
and would require states to evaluate at least 80% of the
3/20/91 Placed on Senate calendar
projects during the life of the reauthorization. Requires literacy
programs in correctional institutions.
7/24/91 P.L. 102-73
HR3239
Gordon
Provides for more stringent reqs. for the Robert T. Stafford Student
3/25/92 Provisions of HR3239 were included in
Loan Program.
HR3553; House began consideration of HR3553
7/8/92 Provisions of HR3239 were incorporated
in S1150, which is now cleared for the
President
HR3648
Kostmayer
School Dropout Prevention
Would impose a school enrollment requirement on the
10/29/91 Public Works & Transportation
Act of 1991
issuance of motor vehicle licenses and instructional permits.
HR4323
Kildee
Neighborhood Schools
Successor to HR3320; States must establish a reform plan after receiving
2/26/92 Education & Labor
Improvement Act
grant. In second through tenth year of grant, states match
funds and distribute a percentage of funds to local educational agencies.
ENERGY
S2166
Johnston
The National Energy Security
Requires large state and municipal fleets operating
2/19/92 Passed in Senate
Act of 1992
in urban areas to use alternative fuels. Requires state
utility commissions to consider providing financial
incentives to utilities to invest in energy conservation programs.
HR776
Sharp
National Energy Policy Act
Major pre-emption of state regulatory authority over electric and gas
5/27/92 Passed in House: 381-37
utilities. Pre-empts state participation in high-level radioactive waste
6/4/92 Referred to Senate Finance
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 4
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
repository decision-making. Pre-empts state taxing authority for uranium
6/16/92 Markup in Senate Finance
enrichment corporations. Mandates review and update of state energy
7/2/92 Unanimous consent agreement was
building codes to a minimum standard.
reached providing for consideration
of the bill on July 22, 1992
ENVIRONMENT
S130
Pressler
Prescribes that no state may allow a low-level radioactive waste
1/15/91 Energy & Natural Resources
facility to be constructed within 50 miles of another state's border
without the approval of that state's legislative branch.
S175
Bingaman
A bill to amend the Resource Conservation & Recovery Act to
1/15/91 Environment & Public Works
improve procedures for implementation of state compacts providing
for the establishment & operation of regional disposal facilities for
municipal & Industrial solid waste & other purposes.
S596
Mitchell
Fed. Facility Compl. Act of '91
Establishes federal requirements for state facilities.
10/24/91 Incorporated Into HR2194
S942
Hollings
Would require that priority be given to planting trees on state
4/25/91 Small Business
lands devastated by disaster or where tree loss is causing
environmental damage.
S976
Baucus
Resources Recovery Act
Call for federal approval/ disapproval of mandated state solid waste
5/20/92 Markup completed by Environment
Amendments of 1991
management plans.
& Public Works
S1081
Baucus
Federal Water Pollution
Requires state plans; there are federal standards & federal sanctions.
7/18/91 Subcmte. hearings held and completed by
Control Act of 1991
Environment & Public Works Committee
S2335
Hatfield
National Beverage
No state which Imposes any tax on the sale of any beverage
3/11/92 Commerce, Science &
Container Reuse and
container may Impose a tax on any amount attributable to the
Transportation
Recycling Act of 1992
refund value of such container.
S2360
Durenberger
Toxic Release and
Amends the Emergency Planning and Community Right to Know
3/17/92 Environment & Public Works
Pollution Prevention Act
Act of 1986 to establish grant programs to assist states In meeting
requirements of this Act. States shall provide at least 20%
of the funds.
S2386
Warner
States are required to submit waste management plans to Administrator
3/20/92 Environment & Public Works
for approval. After a certain time, landfill operators may not accept
waste from generators without approved plans. After a certain time,
landfill owners in states without approved plans may receive
municipal solid waste generated outside the state without
obtaining authorization from the affected local government.
S2363
Kerry
National Recycling
No state may establish or continue in effect a minimum content
3/17/92 Environment & Public Works
Marketing Act
standard for a covered item unless such standard is identical to, or
less stringent than any standard in effect for such item.
S2384
Coats
States are required to submit Solid Waste Management Plans
3/20/92 Environment & Public Works
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 5
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
to the Administrator for approval. After a certain date, landfill owners
may not receive municipal solid waste generated in another state if
the exporting state does not have an approved management plan.
S2579
Lautenberg
Dry Cell Battery
State solid waste plans must Include provisions for a program to
4/9/92 Environment & Public Works
Management Act of 1992
collect from consumers and institutions used mercuric-oxide and
rechargeable batteries and rechargeable consumer products with
non-removable batteries. Pre-empts state authority to enforce
requirements for coding dry cell batteries unless requirements
are Identical to provisions in this Act.
HR12
Hughes
Beaches Environmental
Would require states to conform to federal beach water quality standards.
1/3/92 Report to House by Marine & Fisheries
Assessment, Closure and
Would require the EPA to develop criteria for beach water cleanliness.
(HRpt 102-424)
Health Act of 1991
States would have to test the water along their beaches and post signs
If the contamination levels exceeded the uniform standards.
HR116
Kanjorski
Solid Waste Compact
A bill to amend the Resource Conservation & Recovery Act to improve
1/16/91 Energy & Commerce
Act of 1989
procedures for the implementation of state compacts providing for the
establishment & operation of regional disposal facilities for municipal
& industrial solid waste.
HR173
Olin
Solid Waste
Would place certain restrictions on the Interstate disposal of
1/16/91 Energy & Commerce
Transportation Act
solid waste.
HR870
Torres
Would require management standards and recycling requirements.
2/6/91 Energy & Commerce
HR921
Richardson
Would prohibit the disposal of solid waste in any state other
2/6/91 Energy & Commerce
than the state in which the waste was generated.
HR945
Tauzin
Would require states to provide an opportunity for their
2/6/91 Energy & Commerce
citizens to participate in comprehensive recycling programs.
HR997
Henry
Would require a refund value for certain beverage containers &
2/21/91 Energy & Commerce
resources for state pollution prevention programs.
HR2084
Tallon
Would establish minimum requirement for the water quality criteria
4/25/91 1. Public Works
for dioxin published pursuant to section 304a of the Federal Water
2. Merchant Marine & Fisheries
Pollution Control Act, to require each state to adopt a water
quality standard for dioxin which is at least as stringent as the US
Fish & Wildlife Services, in consultation with the National Oceanic
and Atmospheric Administration to conduct a study on the effects
of dioxin on wildlife.
HR2194
Eckart
Fed. Facil. Compl. Act of '91
Establishes state requirements for federal facilities.
2/4/92 in Conference in House and Senate
HR2387
Studds
Reauth. of the 1984 Atlantic
Allows the federal govt. to temporarily bar bass fishing in the coastal
10/17/91 P.L. 102-130
Striped Bass Conservation Act
waters of states that do not comply with federal guidelines to
protect the striped bass.
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 6
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
HR3865
Swift
National Waste Reduction,
Sets minimum requirements for state plans. This includes requirement
6/18/92 Markup in Energy & Commerce
Recycling, and Mngt. Act
that scrap tire collection sites must be Identified and that a goal of 100%
7/2/92 Approved by Energy & Commerce: 28-15
(RCRA Reauthorization)
recycling 18 months after enactment be adopted. States must submit
solid waste management plan to EPA within 30 months of enactment and
hold public hearings. States must undergo an implementation review 3
years after the plan is approved. If EPA finds that a state is not fully
implementing the plan then the disposal facilities within the state may
accept waste imports without the authorization of the affected local
government. Industries must report to states on the amount of Industrial
solid waste they are producing. States must compile the data and
forward It to EPA.
HR4167
English
Amends the Comprehensive Environmental Response, Compensation
2/5/92 Energy & Commerce
and Liability Act of 1980 to require certain states to contribute to
other states' shares of cleanup costs if a contaminated disposal
facility in one state contains another states' hazardous waste.
HR4258
Huckaby
State Regulation and
Requires states to submit a Solid Waste Management Plan to the
2/19/92 Energy & Commerce
Management of Solid Waste
Administrator for approval; allows states to collect fees for solid
Act of 1991
waste but requires that 1/2 of collections are earmarked for
local governments.
HEALTH
S5
Dodd
Family & Medical Leave Act
Requires employers with 50 or more employees to grant up to 12
10/2/91 Passed Senate
of 1991
weeks of unpaid leave per year to full-time employees for
11/13/91 Passed House
childbirth, adoption, serious illness of the employee or an Immediate
family member. Employees would be entitled to health Insurance
during the leave period & reinstatement to the same or an equivalent
position upon return.
S25
Mitchell
Freedom of Choice Act
Prohibits states from restricting an Individual woman's right to choose to
5/13/92 Hearings held by Labor & Human
of 1991
terminate a pregnancy prior to fetal viability, After fetal viability, a
Resources
state may restrict or prohibit abortion unless termination of the
7/1/92 Ordered to be reported by Labor &
pregnancy is necessary to preserve the life or health of the woman.
Human Resources Cmte. amended by
The bill does not require states to fund the performance of abortions or
yea-nay vote: 12-5
prevent states from requiring the Involvement of a parent, guardian,
or other responsible adult prior to a minor's termination of a pregnancy.
S1229
McCain
Small Employer Health
Would exempt certain small employer purchasing groups from certain
6/6/91 Finance
Insurance Incentive Act
requirements of state laws relating to health benefit plans & to amend
IRS Code of 1986 to equalize tax benefits for self-employed persons
participating in such groups.
S1446
Kerrey
Health USA Act of 1991
Would provide for an equitable and universal national health care
7/11/91 Finance
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 7
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Area
Bill
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
program administered by the states.
S1872
Bentsen
Better Access to Affordable
Pre-empts state mandated benefits not covered in Federally required
3/3/92 Provisions of S1872 were included in the
Health Care Act of 1991
basic benefits packages. Pre-empts existing state legislation
provisions of a cmte. amendment in the nature
regulating managed care and utilization review.
S2306
Bond
of a substitute to HR4210 on 3/3/92, by Finance
Insurance Simplification and
Provides Secretary with the authority to review state health insurance
3/3/92 Finance
Portability Act of 1992
regulatory programs to determine if they meet standards. States that do
not meet stds. have an opportunity to apply a corrective action plan.
If state programs are still considered to be below stds., the Secretary
shall decertify the program and assume responsibility for it.
S2320
Wellstone
Universal Health Care Act
No individual who is a resident of a state is eligible for benefits under this
3/5/92 Finance
title for a month in the calendar year, unless the state provides
6/17/92 Hearings held by Finance
for payment to the National Health Trust Fund.
S2346
Kassebaum
BasiCare Health Access
Pre-empts state laws which regulate policies under BasiCare.
3/12/92 Finance
and Cost Control Act
Also pre-empts state laws which mandate benefits under managed
care that are greater than those offered through BasiCare.
Also with respect to managed care, pre-empts state laws which
restrict reimbursement rates, differential financial incentives, and
utilization review methods. Pre-empts some state laws
regarding medical malpractice. Requires states to contribute to
BasiCare an amount proportional to current Medicaid match,
indexed upward with inflation.
S2347
McCain
Children's Health Improvement
Requires state Depts. of Education to determine the types of health ins.
3/12/92 Finance
Act of 1992
policies to be offered by local education agencies. If local agencies
are not in compliance with requirements, the Secretary can withhold up to
10% of the total amount of Fed. assistance made available to that agency.
S2513
Daschie
American Health Security Plan
Requires states to establish a federally approved plan to administer a
4/2/92 Finance
national health care plan. Federal gov't est. conditions under which state
6/17/92 Hearings held by Finance
programs must insure individuals. Prohibits states from cost-sharing,
except where specified. States not in compliance with requirements
could lose grant money for this project or have feds. assume authority
for it. States are required to pay their share of cost.
S2571
Mitchell
Long-Term Care Family
States are required to maintain current levels of financial commitment
4/9/92 Finance
Security Act of 1992
under Medicaid for population groups and long-term care in services
6/23/92 Hearings held by Finance,
covered by the long-term care plan (indexed for increases in the
Subcmte, on Medicare & Long-Term Care
medical CPI). States are required to establish mechanisms to secure
compliance with specified standards for long- term care insurance.
These regulatory programs shall include toll-free phone numbers
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 8
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
to log complaints and provide information. Consumers should have
access to complaints on file. State regulatory programs must
be certified with the federal government. Secretary is required to
establish mechanisms to ensure presence and operation of
effective state regulatory programs ("look behind" authority).
S2732
Dole
Health Benefits for
Administration proposal. States shall regulate health Insurance
5/14/92 Finance
Self-Employed Individuals
in keeping with Federal standards. State regulatory programs are
Act of 1992
subject to review by Federal government. Pre-empts state
laws with respect to managed care.
S2814
Riegle
Medicare Enrollment
Authorizes Secretary of HHS to enroll QMB (Qualified Medicare
6/4/92 Finance
Improvement and Protection
Beneficiary) eligibles automatically in Medicare Part A and bill state
Act
Medicaid plans for premiums. Currently, individuals must apply for
Medicaid coverage of Medicare Part A premiums.
S2817
Inouye
National Health Care Act
States will ensure the implementation of all state health services,
6/9/92 Finance
of 1992
determine the distribution of health care funding, develop and
administer a mechanism to pay & reimburse health care providers, work
with localities In undetaking health care planning and coordination
with appropriate social and human services, Implement a quality
assurance program, administer a consumer advocacy and Information
program, and license and regulate all health care providers and
facilities. No individual who is a resident of a state is eligible for
covered services under this Act for a month in a calendar year, unless the
state contributes to the National Health Care Trust Fund.
S2878
Bond
Medical and Health
States must develop a comparative value Information program.
6/23/92 Finance
Insurance Information
The program must provide Information on the average prices of common
Reform Act
health care services and Information related to the value of each
health Insurance plan available in the state, Including premium costs
and the value of benefits, and, where available, information on the
variability of those prices within the state or other market areas. The data
must be available within the state not later than one year after
enactment, and must be updated no less frequently than anually,
Within four years of enactment, the state must also provide comparative
quality and outcomes data on health insurance plans and hospitals
and make the Information broadly available in the market areas served
by those plans and hospitals. Grant money would be available.
S2908
Simon
Human Tissue Transplant Act
Authorizes state laws with respect to tissue banks to continue in
6/29/92 Labor & Human Resources
effect UNLESS they are Inconsistent with the provisions of federal
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 9
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
legislation. Further, any requirements of a state with respect to human
tissue Intended for transplantation which is different from, or, in addition
to federal requirements, may not be continued in effect.
HR8
Oakar
Would provide for an equitable and universal national health plan
1/16/91 1. Ways & Means
administered by the states and for other purposes.
2. Energy & Commerce
HR25
Edwards
Freedom of Choice Act of 1991
Would prohibit states from restricting the right of a woman to choose to
6/30/92 Ordered to be reported by Judiciary
terminate a pregnancy before fetal viability or to protect the life or
amended by yea-nay vote: 20-13
health of a woman. A state may impose requirements medically to
protect the life or health of the woman. Nothing in this act shall be
construed to prevent a state from requiring a minor to involve a
parent, guardian, or other responsible adult before terminating a
pregnancy.
HR1300
Russo
Universal Health Care Act
States would be required to pay 85% of state Medicaid effort and
3/6/91 1. Armed Services
of 1991
annual per capita fee of $85 to National Health Care Fund.
2. Energy & Commerce
States would be responsible for allocating Trust Fund share within
3. Post Office & Civil Service
the state,
4. Veterans' Affairs
5. Ways & Means
HR1916
Wyden
Long Term Care Insurance
Would establish federal standards for long-term care insurance
5/20/92 Hearings held by Energy & Commerce,
Consumer Protection Act
policies.
Subcmte. on Health & Environment
HR2089
Walsh
Hearing Loss Testing Act
Would require hearing loss testing of all newborns.
4/24/91 Energy & Commerce
of 1991
HR2235
Thomas
Amendments to Public
Would require that states expend a specific percentage of certain
5/7/91 Energy & Commerce
Health Service Act
purposes relating to the treatment of IV drug abuse under alcohol
and drug abuse block grant.
HR2691
Jefferson
If a dental health care professional has been licensed by a state
6/19/91 Energy & Commerce
to provide dental health care, another state may not, in considering
an application by the professional for a license to provide the dental
services involved, discriminate against the professional on the
basis that the professional is not a resident of the state, or that
the professional was first granted the license by another state.
Proposed
Dole
Would require that states receiving assistance under any federal
Amend.
health grant program certify to the administrator of such program
that the state has in effect a law requiring certain health
professionals Infected with AIDS to disclose this information
to their patients.
Proposed
Hatch
Would require states receiving assistance under any federal health
Amend.
grant program to certify to the administrator of such program that
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 10
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Bill
Program
Bill/Reg.
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
the state has in effect a law requiring individuals Infected with
AIDS to disclose such Infection to any health care professional.
HR2810
Michel
Drug Treatment and
Would expand the nation's drug treatment capacity, promote
6/27/91 1. Education & Labor
Prevention Act of 1991
drug-free/safe schools, require statewide drug abuse prevention
2. Energy & Commerce
and treatment plans, and ensure that new federal grant dollars
provided for treatment sources do not displace state dollars.
HR3626
Rostenkows
Health Insurance Reform and
Pre-empts state mandated benefits not covered in Federally
3/12/92 Hearings by Ways & Means, Subcmte. on
Cost Control Act of 1991
required basic benefits packages.
Health
HR3656
Campbell
Would give priority in the awarding of certain grants to entities located in
10/29/91 Banking, Finance & Urban Affairs
states that have enacted laws to limit the malpractice liability
of physicians providing charity care services, and to amend the
McKinney Homelessness Act to give priority In the allocation of
homeless housing assistance to recipients in states that
have enacted such laws.
Requires each state to establish an outreach system to assure
2/18/92 Energy & Commerce
HR4235
Olin
National Children's Health
Care Act of 1992
that eligible pregnant women and children have access to covered
health services. State health dept. expenditures for the services
of care coordinators shall be reimbursed by the
Administration If established guidelines are followed.
HR4576
Houghton
Health Equity Access
Pre-empts state law with respect to managed care by prohibiting
3/25/92 1. Ways & Means
Improvement Act
1. restrictions on reimbursement rates, 2. restrictions on differential
2. Energy & Commerce
of 1992
financial Incentives, 3. mandating benefits greater than those
3. Judiciary
established in the Act, 4. mandating benefits for qualified small
employer purchasing groups greater than those recommended
under model plan.
Requires states to establish 1. alternative dispute resolution
procedures pertaining to medical malpractice, 2. statewide risk
management program to reduce Incidence of medical malpractice.
States that the Federal National Long-Term Re-Insurance Corporation
is exempt from state tax.
HR4582
Roberts
BasiCare Health Access
Provisions Identical to S2346
3/25/92 1. Energy & Commerce
and Cost Control Act
2. Ways & Means
3. Judiciary
4. Rules
HR4594
Glickman
BasiCare Health Access
Comprehensive health care bill which pre-empts state laws
4/26/92 1. Energy & Commerce
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 11
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Area
Number
Bill
Sponsor
Brief Title
Explanation & Programs Affected
Status
and Cost Control Act
pertaining to benefits required for accidents and health insurance,
2. Ways & Means
malpractice suits, mandates health benefits, regulation of managed
3. Judiciary
care. Requires states to remit their share of Medicaid funding to the
4. Rules
Federal Government. This amount would be Indexed for inflation.
HR4889
Cardin
Flexible Medical Access
A Federal Health Care Cost Containment Commission would allocate
4/9/92 1. Ways & Means
and Cost Containment Act
allowable health spending among the states. States would establish
2. Energy & Commerce
of 1992
commissions to set payment rates for health care services on an
3. Education & Labor
annual basis which would result in aggregate expenditures equal
to the amount allowable under the state expenditure limit. The
commission would set payment systems for states that fall to
establish rate setting commissions. The federal commission
would also hear appeals by classes of providers on the adequacy
of state rates. States would be required to pay the amount
they otherwise would have spent for Medicaid benefits Into
the Public Health Trust Fund.
HR5049
Slattery
Improved Access to
States must establish requirements that insurers guarantee availability
4/30/92 Energy & Commerce
Affordable Health Care
in a state. The small group standards required by the bill would be
Act of 1992
established as model legislation by the National Association of
Insurance Commissioners and applied and enforced primarily by
the states. Secretary of HHS could assume authority for state
governments failing to meet federal standards to certify and
supervise small group Insurance plans. Grant funds available
for FY 1993, FY 1994, and FY 1995 for states to establish small
employer health Insurance purchasing programs. The Secretary of
HHS is required to establish within two years voluntary federal
standards for certifying "qualified" managed care plans and
utilization review programs. States may Impose requirements
under Medicaid. States are prohibited from Imposing specified
limitations or prohibitions on "qualified" plans or programs.
HR5050
Ford
UniMed Act of 1992
Permits Federal government to review state regulatory programs
4/30/92 1. Ways & Means
for the certification of open group health policies. In states that
2. Energy & Commerce
meet regulatory requirements, the Federal government may still
3. Education & Labor
determine whether the policies in the state meet requirements
("look behind" authority). Prevents states from establishing
requirements for open basic certified group health policies
that are different from requirements set forth in the Act.
Prohibits states from enforcing laws that require the offering, as
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 12
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
part of a group health plan or group health policy, of any
services, category of care, or services of any class or type
of providers that differ from benefits required under Title IV of
ERISA of 1974. Pre-empts state laws restricting utilization
review programs that meet Federal standards. States shall
make contributions to UniMed trust fund
HR5174
Glickman
BasiCare Health Access
Each year, the BasiCare Commission will set a maximum allowable
5/14/92 1. Energy & Commerce
and Cost Control Act
percentage for Insurance premiums. States would have the authority
2. Ways & Means
to lower the annual Increase but not raise it. Requirements for
3. Judiciary
BasiCare health benefits will pre-empt state and local government
4. Rules
regulations relating to insurance benefits, except state Information
requirements. Certain provisions of state law pertaining to
managed care are pre-empted. States will be required to contribute
to BasiCare an amount proportionate to their current Medicaid
match. This will be Indexed for Inflation.
HR5325
Michel
Action Now Health Care
States must submit reports addressing how they will enforce established
6/4/92 1. Energy & Commerce
Reform Act of 1992
standards with respect to small employer carriers. Pre-empts state
2. Ways & Means
benefit mandates for small employer health benefit plans that meet
3. Judiciary
consumer protection standards. Exempts qualified purchasing groups
4. Education & Labor
from state health plan benefit mandates. Pre-empts certain state laws
pertaining to medical malpractice and establishes requirements for
state alternative dispute resolution systems. Overrides state laws
which prevent sole use of electronically transmitted claims and other
medical records for payment purposes. (Quill Pen laws). Requires
states to make available to consumers information on the
comparative value of medical services.
HR5376
Collins
Long-Term Care Insurance
No long-term care Insurance policy may be sold in a state unless
6/11/92 Energy & Commerce
Standards and Consumer
the state has a regulatory program to monitor long-term care
Protection Act of 1992
Insurance. These regulatory programs must incorporate enforcement
programs, a means to file complaints, a toll-free number to provide
information on complaints, Information on Insurance policies, consumer
access to compliance Information, and review process for premium
increases. The Secretary may review state programs to determine
adherence to federal standards. States found out of compliance
may lose the program if corrections are not made. Secretary may
review long-term care polícies in states with appoved regulatory
programs ("look behind" authority).
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 13
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
HR5500
Conyers
Health Care for Every
Establishes a National Health Insurance Standards Board which will
6/25/92 1. Energy & Commerce
American Act
develop national health Insurance policies and procedures. States will
2. Ways & Means
administer the program, making payments to providers who care for
3. Post Office & Civil Service
beneficiaries. State programs are required to establish a
4. Armed Services
State Health Advisory Council to provide consumers, providers and
5. Veterans' Affairs
policy experts with a means to oversee and give input on Implementation
of the Act State programs are required to establish District Health
Advisory Councils, composed of consumers, providers and public health
officials, will advise on how to increase capacity in medically
underserved areas and reduce excess capacity in overserved areas.
States will provide 13% of the cost of services under the Act. The
federal payment to states depend on characteristics of residents.
HR5514
Dingell/
Health Choice Act of 1992
Health care reform measure financed through VAT tax (Value Added
6/30/92 1. Energy & Commerce
Waxman
Tax, essentially a national sales tax), employer contributions and
2. Ways & Means
payments from states based on their Medicaid contributions. States
3. Education & Labor
could elect to operate their own programs, as long as their benefit
package was at least as good as that in Health Choice. State mandated
benefit laws would be pre-empted to the extent that they
conflict with Health Choice.
Medicaid
S4
Bentsen
Child Welfare & Preventive
Mandates continuous coverage of children under age 6 for
1/15/91 Finance
Services Act
6 months at a time, prohibits terminating Medicaid coverage for
6/10/92 Hearings held by Finance
children under age 19 before the state determines that the child
does not qualify for Medicaid under other criteria. Mandates
Medicaid coverage of all children who are SSI recipients.
Mandates adjustments in payments in disproportionate
share hospitals when services are provided during exceptionally
long and costly hospital stays for children to age 19.
Changes matching rate in Medicaid.
Also deals with foster care, adoption, and substance abuse.
S29
Moynihan
Coverage of residential drug treatment for pregnant women
1/15/91 Finance
and certain family members.
S62
Moynihan
Homeless Mentally III
Would require states to provide coverage for mobile outreach units
1/14/91 Finance
Outreach Act
to Identify and assist mentally ill homeless people.
4/26/91 Subcmte. hearings held
S902
Bradley
Infant Mortality & Children's
Would phase in coverage of pregnant women and infants with
4/23/91 Finance
Health Act of 1991
incomes below 185% of the poverty level.
S905
Bradley
Childhood Immunization
Would require additional vaccination coverage under the
4/23/91 Finance
Improvement Act of 1991
medicaid program.
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 14
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
S1677
Daschie
Provide for coverage of alcoholism & drug treatment services under
8/2/91 Finance
Medicaid.
HR96
Hertel
Medicaid Eligibility and
Requires states to provide Medicaid coverage to pregnant women
2/11/91 Energy & Commerce,
Benefits Expansion Act
and infants whose family Income does not exceed 150% of poverty
Subcmte. on Health & the Environment
of 1991
level. Requires states to cover all individuals with family Incomes
up to 120% of poverty line. Provides temporary coverage for
dependents of unemployed Individuals.
HR276
Collins
Hospital Closings Community
Would require state plans for appropriately responding to
1/16/91 Energy & Commerce
Relief Act of 1991
closing of hospitals.
HR290
Collins
Would require coverage of services to pregnant women and
1/16/91 Energy & Commerce
children up to 185% of the federal poverty line.
HR395
Quillin
Would provide that clinical social worker services are a
1/16/91 Energy & Commerce
mandatory benefit.
HR382
Oakar
Breast Cancer Treatment
Would require states to enact laws requiring physicians & surgeons
1/16/91 Energy & Commerce
Informed Consent
to Inform breast cancer patients of alternative effective methods of
treatment for breast cancer in order to qualify for federal funds.
HR459
Cooper
Fairness In Medicaid Funding
Would change the medical assistance percentage
1/14/91 Energy & Commerce
Act of 1991
used under the Medicaid program.
HR860
Panetta
Would require the coverage of hospice care under Medicaid.
2/6/91 Energy & Commerce
HR930
Snowe
Amend. to Title XIX of the
Would require states to adopt & enforce certain guardianship
2/6/91 Energy & Commerce
Soc. Sec. Act
laws providing protection & rights to awards as a condition
of receiving Medicaid funds.
HR1129
Collins
Would require state Medicaid programs to provide coverage of
2/21/91 Energy & Commerce
screening mammography/pap smears.
HR1161
Schroeder
Women's Health Equity
Withhold federal medicaid funds from states that do not enact
2/27/91 1. Energy & Commerce
Act of 1991
laws requiring physicians and surgeons to Inform breast cancer
2. Ways & Means
patients of alternative effective methods of treatment for breast
3. Post Office & Civil Service
cancer before treatment begins. Requires Medicaid coverage for
gynecological services provided by nurse practitioners.
Requires states to provide Medicaid coverage for all pregnant
women and children under age 6 with incomes up to 185% of
poverty. Requires states to provide Medicaid coverage for
routine mammography and pap smear screening.
HR1162
Schroeder
Women's Health Care
Would require coverage of obsterical and gynecological services
3/7/91 Energy & Commerce
Coverage Expansion
furnished by nurse practitioners.
Act of 1991
This bill is also incorporated In HR 1161, Women's Health Equity Act
HR1288
Boxer
Immunization Now Act
Would require an entitlement program regarding the immunization
3/7/91 Energy & Commerce
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 15
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
of 1991
of Infants against vaccine-preventable diseases.
HR1311
Vucanovich
Would require state Medicaid plans to provide screening
3/7/91 Energy & Commerce
mammography.
HR1391
Waxman
Medicaid Infant Mortality
Prohibits states from using asset tests to determine Medicaid
3/12/91 Energy & Commerce
Amendments of 1991
eligibility for pregnant women and infants. Requires states to Issue
separate Medicaid Identification numbers to Infants born to
Medicaid eligible women within 60 days of birth.
HR2213
Penny
Amend. to Soc. Sec. Act,
Would require states to establish a basic outpatient service
5/2/91 Energy & Commerce, Ways & Means
Title XIX
to needy children.
HR2656
Stark
Amend Title XIX of
Precludes states from Imposing arbitrary limits on the length of time
6/17/91 Energy & Commerce
Soc. Sec. Act
a Medicaid patient may stay in the hospital.
HR2657
Stark
Amend Title XIX of
Mandates that states pay hospitals and physicians no less than what
6/17/91 Energy & Commerce
Soc. Sec. Act
Medicare would have paid for the services.
HR2949
Stark
Medicaid Prescription
Would require coverage of prescribed drugs under the Medicaid
7/18/91 Energy & Commerce
Drug Act of 1991
program for qualified Medicare beneficiaries and qualified disabled
and working individuals.
HR3595
Waxman
Medicaid Moratorium
Would place a moratorium on federal regs. prohibiting the use of
12/12/91 P.L. 102-234
provider taxes and voluntary contributions to pay for Medicaid. Limits
percent share of the Medicaid Match that states can collect using these
methods to 25%.
HR4311
Richardson
Amend Title XIX of Social
Would require mandatory coverage of services furnished by nurse
2/25/92 Energy & Commerce
Security Act
practitioners under state medicaid plans.
HR4793
Paxon
Amend Part A of Title IV &
Requires that the amount of aid to be provided under the state
4/7/92 1. Ways & Means
Title XIX of Social Security
plan to a family which has received aid under another state's
2. Energy & Commerce
Act
plan during the preceeding 1 year period must not exceed the
amount of aid such other state would have provided the family
under such other plan if the family were residing in such other state.
d.1/29/92
Fraud and Abuse Program
Establishes requirements to be met by State Medicaid Fraud Control
1/29/92, effective date
pp.3298-
Exclusion Authority
units. These units will Investigate and prosecute cases pertaining
to Medicaid fraud. These units will also Investigate complaints
of abuse of patients at institutions that receive Medicaid
3358
payments. States will assume 10% of costs for this program.
HUMAN SERVICES
S4
Bentsen
Child Welfare & Preventive
1. Would require child in foster care to be placed in setting most
1/15/91 Finance
Services Act of 1991
appropriate for that child.
6/10/92 Hearings held by Finance
2. Would require states to submit all claims for federal
reimbursement in one calendar year.
3. Would require the health & education records of foster care to
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 16
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
include: 1) telephone numbers of health providers, and 2) record
of service under Medicaid.
Mandates continuous coverage of children under age 6 for
6 months at a time, prohibits terminating Medicaid coverage for
children under age 19 before the state determines that the child
does not qualify for Medicaid under other criteria. Mandates
Medicaid coverage of all children who are SSI recipients.
Mandates adjustments in payments in disproportionate
share hospitals when services are provided during exceptionally
long and costly hospital stays for children to age 19.
Changes matching rate in Medicaid.
Also deals with foster care, adoption, and substance abuse.
S60
Moynihan
A bill to amend Title IV of the Social Security Act to require states
1/15/91 Finance
to develop plans for cases where the placement of certain children in
foster care or transitional Independent living may not be carried
out Immediately.
S61
Moynihan
A bill to amend Title IV of the Social Security Administration Act to
1/15/91 Finance
make improvements in the foster care maintenance payments
program and for other purposes.
S1212
Graham
Amend. to Soc. Sec. Act,
To provide coverage for certain preventive care Items and services
6/4/91 Finance
Title XVIII
under part B, and to provide a discount in premiums under such part
for certain individuals certified as maintaining a healthy lifestyle.
S1306
Kennedy
ADAMHA Reauthorization
Splits ADMS into 2 grants, one for substance abuse and one
5/12/92 Conference report issued
for mental health. States are required to serve IV drug users
(HRpt 102-522)
and pregnant women seeking treatment within a set time period.
6/9/92 Conference report approved: 86-8
Requires states to pass laws prohibiting the sale of tobacco products
7/1/92 Conference report agreed to in House
to minors or risk losing a portion of their grant money.
by yea-nay vote: 358-60
7/2/92 Submitted to President Bush
S1941
Kennedy
Refugee Resettlement Reform
Requires states to provide case management or contracts for case mngt.
7/2/92 Reported to Senate amended by
Act of 1991
from existing funds for cash, medical assistance and social
Judiciary (SRpt 102-316)
services. Proposes block grant funding instead of line Item for
cash, medical assistance and social services.
S2141
Kennedy
Long-Term Care Insurance
No long-term care Insurance policy may be sold in 8 state unless the state
1/21/92 Labor & Human Resources
Improvement and
establishes a regulatory program. In states with regulatory programs,
4/29/92 Hearings held and completed
Accountability Act
the Secretary is authorized to determine whether or not long-term care
by Labor & Human Resources
insurance policies offered in the state have failed to comply
7/1/92 Ordered to be reported by Labor &
with the requirements of the title. If a state is not compliant, no
Human Resources amended
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 17
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
new policies could be offered under the plan,
S2303
Moynihan
Work for Welfare Act of 1992
Within 60 days after opening a new AFDC case, states would
3/30 92 Hearings held by Finance, Subcmte. on
have to provide assessment, an employability plan and
Social Security & Family Policy
referrals. (see also MANDATE RELIEF)
HR11
Rostenkows
Revenue Act of 1992
Amends Title XI of Social Security Act to grant a Social Security Act
7/2/92 Approved by House: 356-55
beneficiary a civil right to sue a state for damages in federal court
regarding enforcement of administrative provisions. This amendment
pertains to all programs authorized by the Social Security Act for
which state plans are required.
HR375
Mollohan
Would extend eligibility for the Child Care Food Program
1/16/91 Education & Labor
to children receiving day care services pursuant to a state's
job opportunities and basic skills training program.
HR1507
Gekas
Relief for Elderly Eviction and
Would require states that not later than 60 days
3/20/91 Education & Labor
Foreclosure Act of 1989
after commencing any proceeding to compel the sale of residence
occupied by an older individual from such residence, notice
of such proceeding be given to such Individual and to the appropriate
area agency on aging If such proceeding is based on
the failure of such an Individual to pay debt.
HR2021
Snowe
Older Americans
Would require states to appoint an advisory board to make
4/25/91 Education & Labor
Transportation Amendments
recommendations regarding transportation services that affect
of 1991
older individuals; to provide for coordination of such services and
to require the Commissioner of Aging to submit a report regarding
transportation services provided under such act.
HR2025
Snowe
Older Americans Eldercare
Would require states to expand state and community Involvement
4/25/91 Education & Labor
Amendments of 1991
in order to promote community-based long-term care services to
older individuals, including related services for their caregivers.
HR2362
Fawell
At-Birth Abandoned Baby
Requires states to adopt laws to allow for adoptions of abandoned
5/15/91 Ways & Means
Act of 1991
babies within 90 days of abandonment. If states fall to pass
legislation, funds under Title IV of the Soc. Sec. Act will be withheld.
HR3603
Downey
Family Preservation Act
1. Would require 15% of IVB funds be spent on state courts with
10/22/91 Ways & Means
of 1991
funds going directly to the court administrator.
7/2/92 Ordered to be reported by
2. Includes a 50% set-a-side with money to be spent on family
Ways & Means amended
preservation services including substance abuse.
3. Eliminates the means test for Title IV-E, therefore, every child in foster
care can be paid for by the federal gov't. However, the match rate is
reduced to 40% for services and 25% for administration.
4. Requires a state directory of services.
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 18
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
5. Requires extensive data collection. All child welfare spending in
each state needs to be broken down by federal, state and local.
HR3698
Waxman
Community Mental Health &
Would change allocation formulas and would create a separate new
3/24/92 Laid on table by House
Substance Abuse Services
mental health block grant program, earmarking nearly 80% of the
Improvement Act of 1991
ADAMHA funds for drug and alcohol abuse programs. Also
mandates states to enact laws prohibiting cigarette sales to
those under 18, submit drug and alcohol abuse treatment program
plans and establish strategies to accomplish
reduced tobacco use by minors.
Family Leave
S5
Dodd
Family and Medical
Requires employers with 50 or more employees to grant up to 12 weeks
10/2/91 Passed Senate
Leave Act of 1991
unpaid leave per year to full-time employees for childbirth, adoption,
11/13/91 Passed House
or other serious illness of the employee or an Immediate family member.
Employees would be entitled to health Insurance during the leave
period & reinstatement to the same or an equivalent position on return.
HR2
Clay
Family and Medical Leave
A bill to entitle employees to family leave in certain cases Involving
11/6/91 Cmte. hearings held by House Rules Cmte
Act of 1991
a birth, an adoption, or a serious health condition & to temp. medical
11/13/91 Laid on Table In House
leave In certain cases Involving a serious health condition, with adequate
protection of the employees employment and benefits rights, and
to establish a commission to study ways of providing salary replacement
for employees who take any such leave.
d.6/6/91
Child Care Regulations
1. Requires states to spend 90% of their block grant flexible funds on
8/6/91 Comments period ends
pp 26194
direct services.
-26240
2. Withholds federal dollars for any state that restricts parental choice,
including state restrictions that limit the availability of private
and sectarian providers.
3. Forbids states, even If federal money is exhausted, to restrict the
number of child care certificates.
4. Requires that federal funding supplement existing state dollars and not
supplant It using the previous year as the base (l.e. Sept. '90 for FY '91).
5. Requires states to allow parents who receive certificates to use them
for sectarian purposes.
d.6/25/91
At-Risk Child Care
In violation of the legislation, the regulations define "In order to work",
8/25/91 Comment period ends
PP 29054
Regulations
and would restrict at-risk child care to families who need child care to
-29069
accept employment or remain employed, not those who are unemployed,
In training or in educational programs. Circumvents state authority on
standards as those generally applicable to care of a particular type
regardless of the source of payment for the care. This provision would
For further Information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 19
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
require states to pay for child care even if the provider was exempt
from state standards.
Proposed
D'Amato
States which do not Incorporate a workfare program as part of their
Amend.
general assistance program would lose 10% of AFDC money.
Proposed
D'Amato
Provides that for a period of 1 year from the date an individual
Amend.
becomes a new resident in a state, such Individual is eligible
to receive AFDC in an amount that does not exceed the lesser
of the amount the Individual received or could have received
in the former state of residence, or the amount the individual
could have received In the new state of residence.
JUSTICE
S3
Boren
Congressional Campaign
Conference agreement prohibits state party committees from
5/13/92 Override of President's veto
Spending Limit and Election
evading the contribution limits of federal law by using non-federal
rejected in Senate by yea-nay: 57-42
Reform Act of 1992
money for get-out-the-vote activities for non-federal candidates,
(2/3 vote required)
recognizing that such activities may be undertaken with the real
Intention of aiding federal candidates.
S15
Biden
Violence Against Women Act
Requires certain grant recipients to establish state commission on
10/29/91 Reported to the Senate
of 1991
Domestic Violence.
S250
Ford
National Voter
Would require states to allow residents to register to vote in federal
5/20/92 Passed in Senate by yea-nay
Registration Act
elections when they apply for a driver's license or state or federal
vote: 61-38.
of 1991
benefits such as unemployment insurance.
6/16/92 Passed in House: 268-153
7/2/92 Vetoed
S288
Dixon
Regional Presidential
Requires each state to conduct primaries in accordance with this law.
1/30/91 Rules & Administration
Primarles & Caucuses
No state will be allowed to hold a Presidential primary on a date other
Act of 1991
than the date assigned by the commission to the region in which the
state Is located. (SEE ALSO HR46)
S321
McConnell
Law Enforcement Officers'
Unless states adopt the Law Enforcement Officers' Bill of Rights,
1/31/91 Judiciary; Incorporated in
Bill of Rights
federal funding under the Omnibus Crime Control & Safe Streets Act
S1241, but removed in Conference
of 1968 would be cut by 20%. In addition, it allows states to be
Report HR3371
sued for not passing the Bill of Rights.
S352
Glenn
National Guardianship
Would establish national standards for the protection of the rights
2/5/91 Judiciary
Rights Act of 1991
of alleged incapacitated Individuals.
S474
DeConcini
Professional and Amateur
To prohibit sports gambling under state law.
6/2/92 Passed Senate: 88-5
Sports Protection Act
6/3/92 Referred to House Judiciary
S544
Heflin
Animal Research Facilities
Makes it a federal crime to sabotage animal research facilities.
10/16/91 Passed Senate
Protection Act of 1991
(SEE ALSO HR2407)
S635
Thurmond
Comprehensive Violent Crime
Conditions receipts of funding on state implementation of drug
6/16/91 Placed on Senate calendar
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 20
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
Control Act of 1991
testing for targeted classes of offenders. Additional provisions.
Amend.
Rudman
Amendment to the Crime Bill
Would direct states to Increase the size of local police forces.
S1002
Shelby
Makes it a federal criminal offense for parents to flee the state
5/8/91 Judiciary
for purposes of avoiding payment of child support.
(SEE ALSO HR1241)
S1008
McConnell
National Child Abuser
Would req. state agencies to register all offenders convicted
5/8/91 Judiciary Incorporated in
Registration Act
of any acts involving child abuse with the Nat'l Crime Info. Center
Omnibus Crime Control Act, HR3371
at the Dept. of Justice.
S1170
Durenberger
Crimes Against Children
The Attorney General shall establish a state program and guidelines
5/23/91 Judiclary; Incorporated in
Registration Act
requiring any person who is convicted of a criminal offense against
Omnibus Crime Control Act, HR3371
a victim who is a minor to register a current address with local
law enforcement officials of the state for 10 years after release
from prison, parole, or supervision.
S1241
Biden
Violent Crime Control Act
Makes murder by firearm a federal offense with death penalty.
7/11/91 Passed Senate; Provisions
Other mandatory sentences. Also contains Police "Bill of Rights",
modified in conference. See HR3371
Heabeas Corpus, gun control and exclusionary rule.
S1454
Seymour
Penalties Against Violence
Would establish penalties for participation In Illegal gang activity.
7/11/91 Judiciary
S2304
Lautenberg
Stop Arming Felons Act
Amends Title 18 of US Code to permanently prohibit the possession
3/3/92 Judiciary
of firearms by persons who have been convicted of a violent
5/5/92 Hearings completed by Judiciary,
felony, irrespective of state law.
Subcmte. on the Constitution
S2613
Pressler
Anti-Car Theft Act of 1992
Makes auto theft a federal crime. States may elect to participate
4/10/92 Judiciary
in national motor vehicle information system. States not participating
may be denied access to FBI's National Crime Information Center,
HR1
Brooks
Civil Rights Act of 1991
Would amend the Civil Rights Act of 1964 to restore and strengthen
11/22/91 P.L. 102-166
civil rights laws that ban discrimination in employment.
HR46
Bennett
Regional Pres. Primaries
Requires each state to conduct primaries in accordance with this law.
1/3/91 House Administration
Act of 1991
No state will be allowed to hold a Presidential primary on a date other
than the date assigned by the commission to the region In which such
state is located. Requires that each voter shall be eligible to vote only
for a candidate for nomination by the party of that voter's registered
affiliation. If the state law makes no provision for registration by party
affiliation, voters in that state shall register in accordance with
procedures prescribed by the Attorney General. (SEE ALSO S288)
HR326
Gingrich
Would provide for mandatory education for Incarcerated adults.
1/16/91 Education & Labor
3/19/91 Certain provisions put
into HR751 (see Education section)
Provisions also in HR3371
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 21
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
HR629
Solomon
Would impose mandatory sentences for violent felonies committed
1/24/91 Judiciary
against the elderly.
HR642
Jacobs
Would require a 20 percent reduction in certain assistance,
1/24/91 Judiciary; Modified to require
unless a law enforcement agency has a binding law enforcement
a study by Dept. of Justice in
officer's bill of rights.
HR3371
HR1502
Boxer
Violence Against Women
Same provisions as S15.
3/20/91 1. Education & Labor
Act of 1991
2. Energy & Commerce
3. Interior & Insular Affairs
4. Judiciary
5. Public Works & Transportation
HR1241
Hyde
Makes it a federal criminal offense for parents to flee the state
4/9/92 Approved for full cmte. action amended
to avoid paying child support. (SEE ALSO S1002)
by Judiciary, Sub. on Crime & Criminal Justice
7/1/92 Ordered to be reported by Judiciary,
amended
HR2217
Traficant
Would withhold a portion of law enforcement federal assistance to states
5/2/91 Judiciary
that do not have a law that permits the death penalty or life
imprisonments w/out parole, for any conviction of premeditated
murder and for any conviction of murdering a law enforcement officer.
HR2407
Stenholm
Farm Animal and Research
Makes it a federal crime to sabotage animal facilities.
4/2/92 Approved by Agriculture;
Facilities Protection Act
(SEE ALSO S544)
Referred to Judiciary
of 1991
7/8/92 Approved for full cmte. action amended
by Judiciary, Subcmte. on Crime &
Criminal Justice
HR2553
Hobson
National Child Abuse
Would require state agencies to register persons convicted of any acts
6/5/91 Judiciary; Incorporated in HR3371
Registration Act of 1991
involving child abuse with the Nat'l Crime Info. Center, Dept. of Justice
HR2858
Manton
Amend. to U.S. Code,
Would Impose mandatory prison terms for possession or use of a
7/10/91 Judiciary
Title 18
firearm or a destructive device during conduct constituting a crime of
violence or a drug trafficking crime under state law.
HR2862
Ramstad
Jacob Wetterling Crimes
Would require any person who is convicted of a state criminal offense
7/10/91 Judiciary; Similar provisions
Against Children Registration
against a victim who is a minor, to register a current address with
incorporated in HR3371
Act of 1991
law enforcement officials of the state for 10 yrs. after release from
prison, parole, or supervision.
HR2903
Gallegly
Juveniles in Drug Crime
Would impose minimum mandatory prison sentences for drug crimes
7/16/91 1. Energy & Commerce
Prevention Act of 1991
involving minors.
2. Judiciary; Similar provisions
incorporated in HR3371
HR2904
Gallegly
Three-Time Loser Drug
Mandates life imprisonment without release for drug traffickers or
7/16/91 1. Energy & Commerce
Act of 1991
violent criminals convicted of a third offense.
2. Judiciary
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 22
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
HR2931
Hobson
National Child Abuse
Would require state agencies to register all offenders convicted of
7/17/91 Judiciary; Similar provisions
Registration Act of 1991
any acts involving child abuse with the National Crime Information
incorporated in HR3371
Center of the Dept. of Justice.
HR3371
Brooks
Omnibus Crime Control Act
Conf. rpt. combines HR3371 and S1241. Requires states to collect Info.
3/19/92 Mitchell (D-ME), motion to close debate
Conf. Rpt.
of 1991
regarding persons who violate state criminal child abuse laws. If states
on consideration of the conference report
do not comply w/in 3 years, they stand to lose a portion of federal
on HR3371 rejected by yea-nay vote: 54-43.
funding for drug control. States w/ death penalties shall est. minimum
(3/5's vote required)
requirements for attys. representing defendants. Prohibits states from
5/14/92 Conference report considered in
est. lotteries based on professional sports. Requires criminal history
Senate
background checks for firearm purchases. Requires updating and
Indexing state criminal history records. Creates federal offense for
stealing art. Sense of Congress that drunk driving offenses should
be considered in child custody and visitation. Creates federal crimes
for computer and Insurance fraud. Prescribes drug testing.
HR4312
Serrano
Voting Rights Improvement
Requires jurisdictions with large language minority populations to
2/25/92 Judiciary
Act of 1992
provide bilingual assistance to voters.
7/8/92 Reported to House amended by
Judiciary (HRpt 102-655)
HR4366
Conyers
Universal Voter Registration
Requires that each state's motor vehicle driver's license application
3/3/92 1. Administration
Act of 1992
shall serve as an application for voter registration. Requires states to
2. Post Office & Civil Service
accept mail-in voter registration under certain conditions and to
designate locations for registration such as public assistance offices
and public schools and universities.
HR4542
Schumer
Anti-Car Theft Act of 1992
Makes forceful car theft a federal crime. Gives states the option
3/31/92 Hearings held by Judiciary,
of participating in a national motor vehicle information system.
Subcmte. on Crime & Criminal Justice
Authorizes the FBI to deny access to the National Crime Information
5/21/92 Markup by Subcmte. on Crime &
Center to any state failing to participate in the system.
Criminal Justice
HR4585
Schroeder
National Child Protection Act
State shall report child abuse crime Information to, or Index child abuse
3/25/92 Judiciary; Similar provisions in
of 1992
crime Information in, the national criminal background check system.
HR3371
Grant money would be available. If states are not in compliance within 1
year, they could lose up to 10% of funds available through Title /
of Omnibus Crime Control and Safe Streets Act of 1968.
HR4599
Moran
Driver's License Information
It shall be unlawful for a state, or for any person, to disclose, other
3/26/92 Judiciary
Act of 1992
than for a governmental purpose, driver's license information to
any person other than the licensee, without the licensee's freely
granted express consent. Any person aggrieved by a violation
of this section may, in a civil action, obtain appropriate relief from
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 23
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
the state, If the state does not prohibit such disclosure.
HR4897
Cunningham
National Police and
Would amend Title / of the Omnibus Crime Control and Safe Streets
4/9/92 Judiciary
Peace Officer Protection
Act of 1968 to deny grant funds to states unless law enforcement
Act
officers are permitted to carry concealed firearms.
HR5266
Andrews
Amends Omnibus Crime Control and Safe Streets Act of 1968 to
5/27/92 1. Judiciary
reduce funds available to a state by 25% unless states implement
2. Ways & Means
prison workfare program.
HR5304
Frank
To provide that a state court may not modify an order of another
6/2/92 Judiciary
state court requiring the payment of child support unless the
recipient of child support payments resides in a state in which
the modification is being sought, or consents to seeking the
modification in such other state court.
LABOR
S600
Metzenbaum
Child Labor Amendments
Would require states to certify that all minors who wish to work have
3/11/92 Ordered to be reported by Labor &
of 1991
a) permission from guardians and b) are enrolled in school
Human Resources amended by yea-nay vote:10-7
HR514
Kolter
Coal Miner's Unemployment
Would establish a temporary program of supplemental unemployment
1/14/91 Ways & Means
Assistance Act of 1991
benefits for unemployed coal miners who have exhausted their rights
to regular unemployment benefits.
HR773
Stark
Amends the Social Security Act to make ineligible any state
1/31/91 1. Energy & Commerce
that supplements Federal SSI benefits, but does not pass
2. Ways & Means
such benefits along.
EE20-91
Social Security Regulations
Regs. to assist state and local govts. comply with P.L. 101-508 mandating
Soc. Sec. coverage for all state & local govt. employees not covered by a
state or local retirement system. In the regulation, the IRS set minimum
retirement benefit requirements which state that benefits received from
a state or local govt. must be equivalent to the benefit the employee
would have received under Soc. Sec.
REVENUE & TAX
S267
Reld
Would prohibit a state from imposing an income tax on the
2/19/92 Commitee hearings completed by Senate
pension or retirement income of non-residents.
Finance
S473
DeConcini
Sports Service Mark
No state shall sponsor, operate, advertise, or promote any lottery,
6/26/91 Hearings completed by Judiciary,
Protection Act
sweepstakes, or other betting or gambling that uses or exploits,
Subcmte. on Patents, Copyrights &
directly or indirectly, a service mark owned by a professional or
Trademarks
amateur sports organization.
S474
DeConcini
Professional & Amateur Sports
No state shall sponsor, operate, advertise, authorize, license,
11/26/91 Reported to the Senate, SRpt. 102-248
Protection Act
or promote any lottery, sweepstakes, or other betting, gambling,
or waging scheme based, directly or indirectly, on any game
conducted by any professional or amateur sports organization.
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 24
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
S1681
Seymour
A bill to amend Title II of the Social Security Act to make it clear
1/31/91 Judiciary
that states and local governments may not tax Social Security benefits.
HR213
Roe
A bill to amend Title XVIII of the Social Security Act to authorize
1/3/91 1. Ways & Means
payment under the Medicare Program for certain
2. Energy & Commerce
services performed by chiropractors.
HR431
Vucanovich
Prevents states from imposing taxes on nonresidents' withholding
1/14/91 Ways & Means
pensions.
HR490
Lent
Amend. to IRS Code of 1954
Amends the IRS code of 1954 to exclude from the gross income of
1/11/91 Ways & Means
any participant in any state or local government plan so much of
any distribution from such plan as represents his allocable share of
tax exempt Interest of such plan.
HR1531
Unsoeld
Pension Equity Act of 1991
Would prohibit a state from imposing an Income tax on the pension
3/20/91 Judiciary
income of Individuals who are not residents of that state.
HR2913
Archer
Domestic Corporation Tax
Would prohibit states from imposing taxes on a worldwide unitary
7/16/91 1. Judiciary
Equality Act of 1991
base. Also would prohibit states from requiring the Inclusion If the
2. Ways & Means
Income tax of a corporation is calculated more than an equitable portion
of any dividend received from certain unrelated foreign corporations.
HR2971
Doolittle
A bill to amend the Title II of the Social Security Act to provide that no
7/23/91 Judiciary
state or local government may tax Social Security benefits.
TRANSPORTATION
HR2542
Torricelli
Amend. to U.S. Code, Title 23
Requires states to adopt the system for handicapped parking established
6/4/91 Public Works & Transportation
by the Sec. of Transportation and to recognize the parking stickers of
individuals with disabilities from other states.
HR4703
Mineta
Interstate Commerce
Pre-empts state authority to enforce any law or regulation
3/30/92 1. Public Works & Transportation
Commission Sunset Act
relating to Interstate or intrastate market entry, rates of services
2. Judiciary
of 1992
of any motorcarrier, motor private carrier, water carrier, freight
3. Energy & Commerce
forwarder, or broker that provides transportation of property,
Including express packages, in Interstate commerce. No state
may require any interstate private or for-hire motor carrier or
Interstate broker of property to prove the lawfullness of any
Interstate transportation activity including, but not limited to
requiring the carrier to maintain any certificate or permit Issued
by the Interstate Commerce Commission, register vehicles operated
under permit Issued by ICC, display decals or stamps as a means
of identification, or pay fee or tax pertaining to any of these
activities.
S965
Intermodal Surface
1. Effective 09/30/96, states must join the Internat'l Registration and
12/18/91 P.L. 102-240
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 25
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
Transportation Efficiency Act
the International Fuel Tax Agreement.
of 1991
2. Effective 9/30/94, states will no longer be allowed to collect fees
from motor carriers subject to the jurisdiction of the ICC. A 1-year grant
program would be established to offset the revenue loss to the states.
3. Effective 9/30/96, states must join the Internat'l Fuel Tax Agreement
which uses a base state registration for the collection of fuel use taxes
and is overseen by the IFTA Board.
4. Would offer grant money to states to establish motorcycle helmet and
seat belt laws. States not participating in the grant program by FY 1994
would be required to spend 1.5% of their highway money on highway
safety programs.
HR3221
Clement
Would pre-empt state laws relating to the regulation of rates for
3/24/92 Subcmte. hearings in Public Works &
surface transportation of property services provided by certain
Transportation, Subcmte. on Surface Transport.
motor and air carriers.
4/2/92 Subcmte. hearings completed by
Surface Transportation
HR4335
Hastert
Safe and Competitive Trucking
No state shall have In effect or enforce any law, regulation, std., or other
2/27/92 1. Public Works & Transportation
Act of 1992
provision relating to any of the following: intrastate rates, routes,
2. Judiciary
or services of any interstate motor carrier, or interstate broker which
4/2/92 Hearings completed by Public Works,
provides intrastate transportation of property, including express
Subcmte. on Surface Transportation
packages; the leading, rental, or other sourcing of commercial drivers
and motor vehicles by interstate motor carriers of property
operating intrastate commerce.
OTHER
HR74
Bryant
Professional & Amateur Sports
Would prohibit sports gambling under any state law.
9/17/91 Approved for full committee action by
Protection Act
Justice Subcmte. on Econ. & Commercial Law
HR611
Gallegly
Would make ineligible for federal financial assistance any state or
1/23/91 Government Operations
locality the President determines to have a policy providing sanctuary
to members of the Armed Forces who are avoiding military obligations.
HR843
Atkins
National Plumbing Products
Would establish federal standards for the manufacturing and labeling
2/6/91 Energy & Commerce
Efficiency Act of 1991
of certain plumbing products.
HR1424
Meyers
Enclave Fire Protection Act
Would require states to permit certain emergency response personnel
3/13/91 Government Operations
of 1991
to conduct preincident planning activities and for other purposes.
HR5283
Dymally
To pre-empt State and local sanction measures against Namibia.
5/28/92 Foreign Affairs
MANDATE RELIEF
HConRes
Rose
Expressing the sense of Congress that adoption of new Federal mandates
4/25/91 Government Operations
141
should be contingent on the financial ability of state and local
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 26
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
governments to implement the mandates.
HR1546
Barnard
Amends Congressional Budget Act of 1974 to call for a point of order
3/21/91 Rules
on any bill or resolution which, in the judgement of CBO, Is likely to
result in an annual cost to state and local gov'ts of $50,000,000
or more with respect to any program, project, or activity.
HR1547
Barnard
Intergovernmental Mandate
Establishes procedures to assure that the Federal government pays
3/21/91 Rules
Relief Act of 1991
the total amount of additional costs Incurred by state and local gov'ts
in complying with any intergov'tal regulation which takes effect on or
after the date of enforcement of this Act.
HR2260
Herger
Unfunded Federal Mandates
Assures that the Federal government pays the total amount of additional
5/8/91 1. Government Operations
Relief Act of 1991
direct costs incurred by state and local governments in complying
2. Judiciary
with any Intergovernmental regulation which takes effect on or after
3. Rules
the date of enactment.
HR2338
Snowe
To provide that no state or local gov't shall be obligated to take
5/14/91 Government Operations
any action required by Fed. law enacted after the date of this Act unless
all expenses are fully funded by the United States.
HR3344
Hochbrueckner
To review and Inventory the increasing number of federally mandated
9/16/91 Government Operations
Nat'l Comm. on Intergov'tal
programs and to recommend changes necessary to reform the system by
Mandate Reform Act
which federally mandates programs are established.
HR4207
Snowe
To amend Title 23, US Code, to repeal a penalty for noncompliance
2/7/92 Public Works & Transportation
by states with a program requiring the use of safety belts and
motorcycle helmets.
HR4613
Thomas
States' Rights and Local
No statute, or rule promulgated under such statute, shall pre-empt,
3/26/92 Government Operations
Legislative Prerogatives
in whole or In part, any state or local government law, ordinance,
Preservation Act of 1992
or regulations, unless the statute explicitly states that such pre-emption
is Intended or unless there is a direct conflict between such statute
and a state or local gov't law, ordinance, or regulation so that the
two cannot be reconciled or consistently stand together.
HR5125
Shays
A bill to amend the Congressional Budget Act of 1974 to expand
5/7/92 1. Government Operations
the requirement that legislation be accompanied by cost estimates
2. Rules
of Its impact on state and local governments.
HR5545
Moran
Fiscal Accountability and
To improve federal decisionmaking by requiring a thorough
7/2/92
1. Rules
Impact Reform Act
evaluation of the economic Impact of federal legislative and
2. Judiciary
(FAIR Act)
regulatory requirements on state and local governments and the
economic resources located therein.
HR5591
Horton
Mandate and Community
Establishes a Commission to review, consolidate and eliminate certain
7/9/92
1. Government Operations
Assistance Reform Act
mandates. Amends Congressional Budget Act of 1974 to delete
2. Rules
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 27
7/14/92
1992 Hall of the States Mandate Monitor
Shaded areas Indicate recent changes or additions to the Monitor.
Program
Bill/Reg.
Bill
Area
Number
Sponsor
Brief Title
Explanation & Programs Affected
Status
language stating that cost estimates are required only if submitted in
3. Judiciary
a timely manner. Further requires that cost estimates accompany
the conference report of any legislation.
S2080
Levin
Pre-emption Clarification and
Requires a statute to state explicitly Congress' Intent to pre-empt state &
11/26/91 Governmental Affairs
Information Act of 1991
local gov't powers before the courts and federal agencies could
Invalidate or prohibit any state or local gov't law, ordinance or regulation.
S2170
Dodd
Distressed Urban Areas
Expresses the sense of the Senate that mandates from the Federal
1/30/92 Labor & Human Resources
Assistance Act of 1992
level must be either paid for at the Federal level or that states and
cities and towns be given more time to comply.
S2204
Durenberger
Repeal of Certain Provisions
Amend Intermodal Surface Transportation Efficiency Act of 1991 to
2/6/92 Environment & Public Works
of Law Relating to Seat Belts
repeal the provision relating to penalties with respect to grants to
and Motorcycle Helmets
states for safety belt & motorcycle helmet traffic safety programs.
S2289
Roth
Competitiveness Enforcement
Requires agencies of the Federal government to prepare an estimate
2/27/92 Rules & Administration
Act
of the total costs to state and local governments for each year
in which the rule would be in effect.
S2301
Sasser
Infrastructure Stimulus Act
Provides a temporary waiver of states' matching fund
2/27/92 Environment & Public Works
of 1992
requirements for federal-aid-highway programs and for mass
transit discretionary and formula capital construction projects,
where the Governor of the state has certified that sufficient funds
are not available to pay the cost of the non-Federal share of the project.
S2303
Moynihan
Work for Welfare Act of 1992
Provides uncapped appropriation for JOBS and for child care under
3/30/92 Hearings by Finance, Subcmte. on
JOBS, state match requirements would be repealed, but would have
Social Security & Family Policy
"maintenance of effort" requirements. (see also HUMAN SERVICES)
S2319
Nickles
Economic and Employment
Requires Fed. legislation and regulations to be accompanied by economic
3/5/92 Governmental Affairs
Impact Act of 1992
and employment impact statements assessing their Impact on the private
sector and state and local governments.
S2348
Mack
Federal Mandates Relief Act
A reimbursement bill which would place a disincentive on Congressional
3/12/92 Governmental Affairs
of 1992
mandates by requiring the Federal Gov't to pay for the cost of mandates.
S2349
Mack
A point-of-order bill which would slow the process of passing unfunded
3/12/92 Rules & Administration
Federal mandates. Senators could raise a procedural point-of-order and
stop any legislation on unfunded mandates from coming to a vote.
For further information contact Christine Wnuk, National Conference of State Legislatures, 444 No. Capitol St., NW, Washington, D.C. 20001 (202) 624-8695
page 28
7/14/92
Mandate Relief Bills
Date
Type of Relief
Author
Bill
Introduced
Cosponsors
Chamber
Committee
Staff Phone
Study
Hochbrueckner
HR3344
9/16/91
27
House
Government Operations
(202) 225-3826
Horton
HR5591
7/9/92
2
House
Government Operations/
(202) 225-4916
Judiciary/ Rules
Fiscal Note
Shays
HR5125
5/7/92
17
House
Government Operations/
(202) 225-5541
Rules
Roth
S2289
2/27/92
0
Senate
Rules & Administration
(202) 224-2441
Nickles
S2319
3/5/92
15
Senate
Governmental Affairs
(202) 224-5754
Moran
HR5545
7/2/92
80
House
Judiciary/ Rules
(202) 225-4376
Point of Order
Barnard
HR1546
3/21/91
26
House
Rules
(202) 225-4101
Mack
S2349
3/12/92
2
Senate
Rules & Administration
(202) 224-5274
Funding
Rose
HConR141
4/25/91
1
House
Government Operations
(202) 225-2731
Dodd
S2170
1/30/92
1
Senate
Labor & Human Resources
(202) 224-2823
Snowe
HR2338
5/14/91
12
House
Government Operations
(202) 225-6306
Mack
S2348
3/12/92
2
Senate
Governmental Affairs
(202) 224-5274
Barnard
HR1547
3/21/91
26
House
Rules
(202) 225-4101
Herger
HR2260
5/8/91
1
House
Government Operations/
(202) 225-3076
Judiciary/ Rules
Transportation
Durenberger
S2204
2/6/92
16
Senate
Environment & Public Works
(202) 224-3244
Snowe
HR4207
2/7/92
56
House
Public Works & Transportation
(202) 225-6306
Sasser
S2301
2/27/92
2
Senate
Environment & Public Works
(202) 224-0642
Medicaid
Dannemeyer
(202) 225-4111
Human Services
Moynihan
S2303
3/30/92
0
Senate
Hearings held by Finance,
(202) 224-4451
Subcrnte. on Social Security &
Family Policy
Pre-emption
Levin
S2080
11/26/91
3
Senate
Governmental Affairs
(202) 225-6221
Thomas
HR4613
3/26/92
19
House
Government Operations
(202) 225-2311
Source: National Conference of State Legislatures
National Conference of State Legislatures
BULK RATE
444 North Capitol Street, NW
U.S. POSTAGE
Suite 500
PAID
Washington, D.C. 20001
WASHINGTON, DC
PERMIT NO. 5614
Hall of the States Mandate Monitor
)
Caron
The Honorable James Baker
Chief of Staff of White House
NRN
Washington D.C.
Dear Mr. Baker,
The purpose of this letter is to seek approval or
disapproval of the use of your name in the book I am working
on. An attached copy is enclosed SO that you can see how and
why I would desire to use a name with the prophecy of
Jeremiah. 49:13 thru 14.
A letter from your secretary stating approval or
disapproval is desired but if no answer arrives I will
accept that as a disapproval and remove your name before a
Copyright is applied for.
Your friend,
Milton Lee Curry
Box 1329
Buna, Texas 77612
12
THE TWO RUMORS
One must search and seek to become a faithful witness
for the Lord. How can one witness to another and not even
know what the word of our God is saying?
The prophets approach of writing and his speech should
also become familiar. At times they spoke of the beginning and
ending of the subject although there may be a great time
space separating two occurrences.
Twelve months was the set time between these two rumors
but Jesus said, For there shall be great tribulation, such
as was not since the beginning to this time. Except those
days should be shortened there should no flesh be saved but
for the elect's sake those days shall be shortened.
I cannot give the days the Lord has not given to me,
therefore I cannot say how many days will be taken away from
the 2,300 day set time. This I can say, We are now living
within the days the Lord has shortened the great tribulation.
Many have already tempted the Lord by not hearing are
believing the servant the Lord sent to warn them. The very
gospel they preach will be the gospel that will condemn
them.
The Lord said, if they will not believe the servant I send
they will neither believe me.
Bozrah was the territory settled and named after the
dukes of Esau. Eusau's brother was Jacob.
From the ages of antiquity changes have occurred unto
this present time. These changes must be realized and
13
accepted concerning territories and name spelling. God's
word never changes.
Also bring to remembrance the first and great
commandment. Thou shalt love the Lord thy God with all thy
heart, and with all thy soul, and with all thy mind.
Three things mentioned, heart, soul, and mind. Therefore
meditating and searching, and seeking is one third an
obligation in worship as believing, and obeying to do all
the things the Lord said we should do. The devil and all his
angels will never take that privilege from me.
Bozrah a territory, named after the dukes of Esau over
time became the territory of Iraq. Sometime between the days
of antiquity until now, it became Basra.
In Isaiah's time it was Bozrah. In Jeremiah's time it
remained Bozrah, therefore their prophecies speak of Bozrah.
The Edomite territory to be destroyed with its people ending
tribulation.
The importance of Basra is that Saddam Hussein placed
his choice troops around and near Basra during the war.
As we proceed in meditation of the prophecy you will
realize why I have gone to great lengths explaining Basra.
Jeremiah 51:46 And lest your heart faint, and ye fear
for the rumor that shall be heard in the land; a rumor shall
both come one year, and after that in another year shall
come a rumor, and violence in the land, ruler against ruler.
Two rumors, one in one year, the second rumor in the
year following. Then ruler is against ruler.
14
Jeremiah gives us an amazing clue of how to recognize
the first rumor. Then Daniel the prophet gives great detail
of both rumors. But the Lord God is truly the giver of all
good gifts to mankind for the prophets wrote as they were
moved by the Spirit.
If you are familiar with the Gulf war you will
immediately recognize the ambassador sent unto the
heathen (Gentile nations) to come against her.
FIRST RUMOR
Jeremiah 49:13 thru 14 For I have sworn by myself,
saith the Lord, that Bozrah shall become a desolation, a
reproach, a waist, and a curse: and all the cities thereof
shall be perpetual wastes.
I have heard a rumor from the Lord, and an ambassador
is sent unto the heathen, saying, Gather ye together, and
come against her, rise up to battle.
The Majesty, the wisdom and the knowledge of our Lord
daily continues to astonish me. Whom else but the Lord could
have been SO accurate at the set time?
Jeremiah was only the Lord's servant, recording God's
truth, which will be fulfilled as recorded.
Hear Jesus, Luke 24:44 And he said unto them, These are
words which I spake unto you, while I was with you, that all
things must be fulfilled, which were written in the law of
Moses, and in the prophets, and in the Psalms, concerning
me.
15
Looking back on the event of the Gulf War we can see
this prophecy has already been fulfilled.
You should have already recognized the messenger sent,
saying gather together, and come against her, was the
Secretary of State, James Baker. Mr. Baker represents the
United States of America.
August 2, 1990 Iraq invaded Kuwait. The Secretary of
State shuttled from nation to nation gathering them together
to rise up and come against Iraq.
A deadline was set for Iraq to withdraw from Kuwait.
Prior to the deadline Saddam, in a radio speech said
his country was ready to fight to keep conquered Kuwait.
The rumor Jeremiah heard from the Lord was in
fulfillment at that time. The nations rose up to battle.
Retain this study in memory as we hear what the Lord
wanted us to known concerning the great tribulation.
Let us come to the knowledge of truth SO we may warn
others to repent and be prepared to stand before the Lord in
the resurrection of the just.
The best method in interpreting scripture is to hear
another prophets interpretation upon that particular
subject. Let us hear Daniel.
Beginning in Daniel 11:21, speaking of the king that
rises up to take away the daily sacrifice.
Daniel 11:21 A vile and contemptible person will rise
whose line is not of royal succession.
Saddam Hussein arose and assumed presidency of Iraq
July 16, 1979. He did not come from a royal succession.
16
His word is worthless for he practices deceit, and
without warning he enters the richest areas and overpowers
them with great forces while inflicting fear and torture
upon those whom oppose him. He controls his own nation in
this same manner.
August 2, 1990 Iraq invaded Kuwait and devised his
plans against strong nations.
Jeremiah's rumor he heard from the Lord, a messenger
has been sent among the nations. Gather yourselves together
and come against her.
Saudi Arabia was the base the nations gathered to
oppose Iraq. Saudi Arabia is south of Iraq.
Daniel 11:25 thru 26 And he shall stir up his power and
his courage against the south with a great army: and the
king of the south shall be stirred up to battle with a very
great and mighty army, but he shall not stand: for they
shall forecast devices against him.
Yea, they that feed of the portion of his meat shall
destroy him, and his army shall overflow: and many shall
fall down slain.
We now look in hindsight and see this is the first
rumor. Looking forward into the future another rumor is yet
to come, fulfilling the scripture.
Daniel 8:10 thru 12.
And it waxed very great, even to the host of heaven;
and it cast down some of the host and of the stars to the
ground, and stamped upon them.
17
Yea, he magnified himself even to the Prince of the
host, and by him the daily sacrifice was cast down.
And an host was given him against the daily sacrifice
by reason of transgression, and it cast down the truth to
the ground: and it practiced and prospered.
The future is dim for Israel, Egypt, and their allies.
For it is written in the scriptures, When Egypt fails her
helpers will fall.
Israel and Syria will fall even before Egypt and the
allies fail.
Daniel 11:27 thru 28 covers the space of time
separating the two rumors.
And both these king's hearts shall be to do mischief,
and they shall speak lies at one table; but it shall not
prosper: for yet the end shall be at the time appointed.
Then shall he return into his own land with great
riches; and his heart shall be against the holy covenant:
and he shall do exploits, and return to his own land.
We the people bear witness to his exploits. Blowing oil
well heads polluting air, land and sea. Carting Kuwait's
riches to his own land.
There is a time appointed by our Lord for this return
south.
Second Rumor
Daniel 11:29 thru 30 At the time appointed he shall
return, and come toward the south: but it shall not be as
the former, or as the latter.
For ships of Chittim(Gentiles) shall come against him:
18
therefore he shall be grieved, and return, and have
indignation against the holy covenant: SO shall he do. he
shall even return, and have intelligence with them that
forsake the holy covenant.
This will not all happen in one day but a number of
days will pass before the time of the end. To prevent
confusion Let us place verse 11:40 before 11:31 to have a
better clarification separating the time appointed from the
time of the end.
Daniel 11:40 And at the time of the end shall the king
of the south push at him: and the king of the north shall
come against him like a whirlwind, with chariots, and with
horsemen, and with many ships; and he shall enter into the
countries, and shall overflow.
Daniel 11:31 And arms shall stand on his part, and they
shall pollute the sanctuary of strength, and shall take away
the daily sacrifice, and they shall place the abomination
that maketh desolate.
At the time appoint Iraq will return south. Many people
whom will be in his path will be judged therefore the
judgment of the world will begin at the time appointed.
these are times the Lord set.
Acts 17:30 thru 31 And the times of ignorance God
winked at; but now commandeth all men every where to repent.
Because he hath appointed a day, in that which he will
judge the world in righteousness by that man whom he hath
ordained: whereof he hath given assurance unto all men, in
19
that he hath raised him from the dead.
Many mock as Paul tried to warn them their day of
judgment will come whether they are dead or living on earth.
God is not mocked for he will come quickly, to repay
every one for what he has done.
The gospel has been preached over the world. Call upon
the name of the Lord, believe upon the name of the Lord
Jesus Christ. But they have not believed the gospel nor
obeyed anything the Lord commanded his people to do.
It was written in the law of Moses.
Deuteronomy 18:18 thru 19 I will raise them up a
prophet from among their brethren, like unto thee, and will
put my words in his mouth; and he shall speak unto them all
that I shall command him.
And it shall come to pass, that whosoever will not
hearken unto my words which he shall speak in my name, I
will require it of him.
Jesus came in the name of the Lord God. He spoke all
the Father gave him to speak.
Now the day of judgment will begin at the time
appointed.
NRN
September 6, 1992
President George Bush
The White House
Washington, DC
Dear Mr. President:
Hey
Big Spender!. Where have you been the last four years
talk about slick! You've let people starve and struggle and worry
for four years because you were saving up all this money to use as a
Big Stick to beat people into voting Republican when you got into
trouble with your voodoo economics
you knew this trickle-down
theory was really "gusher-up theory all the time you conniving char-
acter and you put aside this money to rescue you and keep your power.
I wish you had put one-fourth as much energy into helping people these
past years as you are putting into your selfish ambitions now. Of couse
you've now jettisoned your credibility on your foreign policy expertise
and concern as well as your domestic credibility, which is long gone.
Your criticism of Clinton's health care plan is laughable when, under
you, nearly 40 million people lack any health care ins. and hundreds of
thousands more are losing theirs along with their jobs and pensions.
We also know you've done nothing to contain healthcare costs which have
skyrocketed and if you get your capital gains tax cut for the rich (less
than 1% of the alamost 7% it would effect would get most of that) you'll
cut Medicare even more
and probably Medicaid too. That's your out-
rageously inhumane "healthcare plan".
We've seen how your "ecomomic philosophy" has transferred the biggest
share of wealth in history from the poor and middle-class to the already
wealthy and how you have the gall to ever say otherwise is frightening
in what it tells us about your personal ambition being a priority over
helping anyone who isn't rich and also over the good of our country. I
predict the worst economic disaster that has ever befallen modern society
to take place if you get a second term! Is that how you want to go down
in the history books?? As far as the poor and homeless and elderly and
sick go
you "aim't seen nothin' yet". The mood of the populace
is angry and if it keeps on this way and your ugly, divisive tactics
continue, I wouldn't be surprised to see lots of blood in the streets.
You can't ignore and lie to the largest share of the populace indefin-
itely and expect them not to fight back.
We know how many jobs are gone and still going and how the few jobs you've
"created" are low-paying, partime and without fringe benefits. We know
corporations have been allowed to incur massive debt which means less
money for investment and how the executives still "get theirs" and the
little guy pays, or in cases of coro, rampant bankruptcy, is left holding the
bas. We know about the myriad,tax deductions (like operation loss) work
and who they work for and how deregulation, mergers, hostile takeovers,
and the like have cheated the average American and how jobs overseas
makes companies richer (but not American workers). You8ve allowed the
Federal debt to soar by never sending a decent budget to Congress. Foreign
countries don't pay their fair share of taxes and deregulation has cut
down competition and threatened public safety and your catering to special
2
interests
all the while youre yelling at Congress for doing it (as if you have
a special dispensation to do it) is disgusting.
Your moral preaching while acting in an immoral way as far as taking
care of this country's needs is shameful as is the constant streamm
of misinformation and lies coming from the Republican Party and from
you.
You still don't seem to "get it" and, in the few cases you do, your
actions are so cynical as to be unbelievable. Americans want more
time to spend with their families yet, because of your neglect, have
to work harder and longer for less and both parents have to do it.
Some people have to beg or go on what little dole is left. For the
first time in my life, and I've lived awhile, our church has had to
feed people one or two nights a week in ever rising numbers and
we're coming to the end of our finances and volumteer time. People
don't want lectures about "family values"
those that have them(values)
don' t need the lecture and those that don't won't listen anyway. We
want an effective and fair government that actually IS effective and
fair and doesn't just talk about it! We want jobs, roads, healthcare
that we can afford, a decent education ( and I don't want to pay for
Catholics and Fundamentalists kids) as our forefathers meant us to
have, enough police and programs for kids to cut down on crime (which
has risen under you), and fairness in the tax code and a sense that
we're actually getting something for our dollar
all of us
not just the voters who live in states that are vital for
reelection
and we want politics we don't have to hate.
We also want a president we can trust. Think we're going to vote
for you??????NOT ON YOUR LIFE!!!!!
A tax cut? I don't want it even though I could use it, because I know
it would increase the deficit and my grandchildren will be strapped.
The rich people in this country want it
they selfishily
take all they can get and, of couse, they know, with you at the helm,
they 11 be the ones that get it. It the same time, I'm tired of paying
their share so get some revenue from raising taxies on them for a change.
(I know your mind is set in cement on this, however). Don't you ever
think of the future of all those grandchildren you so picturesdly surr-
ounded yourself with at the convention? Don't you want a debt-free
nation with clean air and water? Evidently you think just making sure
they have money and are isblated from all those people who aren't radi-
cal right-wingers is all they need, You are really short-sighted.
And if foreign policy is so important why did you snatch Jim Baker
away from it? I used to have a little respect for him but since he
came the campaign has gotten more vicious, irrelevant and untrue so
you are all down in the mud together. When you try to stand up at
the end of this campaign, that mud won't come off. Are you being
cowardly about the debates because your record has been so bad?
Yours truly,
Bob Body Donaldson
9/4 Phone regnetted
Bruntagne
OK to
reqret
Laurie & Tubby Hunter
and
Bill & Billie Carl
Invite you to
DOVE HUNT
RANCHO FELICIDAD
3 pm Saturday — September 26, 1992
barbecue and drinks Saturday evening
R.S.V.P. 512/888-4471 Johnnie Wesson
LEAVE CORPUS CHRISTI ON I-37 - GO TO EXIT 36 (TYNAN/SKIDMORE),
AT STOP SIGN (FM 359), TURN RIGHT, GO TO TYNAN - TURN LEFT IN
TYNAN AT FM 796. TAKE 796 TO FM 888 (THERE WILL BE A
CEMETERY), TURN RIGHT ON 888 APPROX. 15 MILES +/- TO RANCHO
FELICIDAD (LOOK FOR SIGN ON THE LEFT). RANCH PHONE IS
358-8552.
131
65
BEEVILLE
59
To I-37
202
888
Navaser
FELICIDAD
181
202
1-37
888
19
888
Skidmore
Tynan
:
FILES- spoke
September 1, 1992
w/her by phone
Dear Mr. Baker:
Congratulations to you! You're back in our old
neighborhood.
I'm writing to ask for your support and recommendation in
filling an administrative position on the White House staff.
I was unable to return to work following the '88 Campaign
but due to personal circumstances - I must. You have probably
completed staffing your immediate office but perhaps you would
help me out by personally recommending me to White House personnel
vouching for my professional record and personal character - not
to forget - my dedication to The President.
Recently, I received a call and had a subsequent interview
with Mr. Fehrer of the personnel office. He had received my
resume and wanted to meet with me to discuss my areas of
interest. I also spoke to Ms. Jackson of your office to ask
her to personally let you know that I was available. Of course,
I would consider any office but believe there may be something
available in Congressional correspondence and I would consider
that area.
Thank you Jim. I sincerely appreciate your recommendation.
Pat Bye
PS: If you could use some help in your office, I
would accept a temporary spot until after the
election. Pro-bono, if necessary.
PATRICIA A. BYE
511 N. Wakefield Street
Arlington, Virginia 22203
703-524-6619
WORK EXPERIENCE
BUSH-QUAYLE '88 CAMPAIGN
August 11, 1988 thru
November 9, 1988
Assistant to Senator Dan Quayle's Campaign Director
Supported the Campaign Director, his Deputy and the Director of
Scheduling and Advance in all areas of the division's
administrative procedures. Responsible for review and
follow-up of incoming communications dealing with scheduling
and long-range planning and for maintaining all official
records for the office of the Vice Presidential Candidate.
BLAIR HOUSE RESTORATION FUND
March 2, 1987 thru
June 17, 1988
Executive Director
Managed all operations of the organization established to
monitor and disburse funds in connection with the refurbishment
of the official guest house of The President. Established
operating, record keeping and financial procedures of the Fund,
in consultation with its officers, attorneys and accountants.
Managed the day-to-day operations of the Fund, which included
arranging from its resources for payments related to the
restoration of Blair House, reporting to the officers, and
coordinating extensively with the Fund's directors, National
Council members, contractors, and senior State Department
Officials, including the Chief of Protocol, regarding all
aspects of the organization.
DEPARTMENT OF STATE
September 6, 1983 thru
July 11, 1986
Special Assistant to the Assistant Secretary of State for
International Organization Affairs and
Staff Coordinator for Plans and Policy
Assisted the Assistant Secretary in implementing the
multilateral policy objectives established by the President and
Secretary of State. Insured that the Assistant Secretary's
decisions were communicated and implemented in a timely and
effective manner. Coordinated Bureau activities with
appropriate White House Staff. Supervised the preparation of
Congressional testimony. As staff Coordinator for Plans and
Policy, devised systems whereby the Assistant Secretary was
able to chart his priorities and commitments within the UN
system. In an administrative capacity, arranged for the
Assistant Secretary's U.S. Intergovernmental discussions, as
well as international conferences and bilateral consultations,
including the US General Assembly and the annual meeting of US
Ambassadors to UN System agencies. Travelled extensively with
the Assistant Secretary, providing both administrative and
policy support.
COMMISSION ON THE BICENTENNIAL OF THE US CONSTITUTION
Special Assistant to the Staff Director
November 5, 1985 thru
and Liaison between office of the
June 29, 1986
(Detail)
Executive Director and Commission Staff
At the request of the Chief Justice, was detailed by the State
Department to the Bicentennial Commission to oversee The Chief
Justice's transition from the Supreme Court to the Headquarters
of the Commission and to serve as a Special Assistant to the
Staff Director of the Commission. In latter capacity, served
as Director of Operations for the Commission with
responsibility for the establishment of administrative
procedures and advising and assisting office directors with the
implementation of various organizational plans.
-2-
THE WHITE HOUSE
January 1982 thru
July 1983
Administrative Assistant to the Deputy Chief of Staff
Responsible for establishing the overall management procedures
of the Office of the Deputy Chief of Staff of the The White
House. Assisted the Deputy Chief of Staff on Presidential
trips, including survey trips for Presidential summit meetings
and temporary operations from the Santa Barbara White House.
REAGAN-BUSH TRANSITION
November 1980 thru
PLANNING GROUP
January 1981
0
Executive Assistant and Staff Coordinator
Served as Executive Assistant and Staff Coordinator to the
Director of Scheduling and Advance. During this time, served
as one of two principal; staff coordinators at the Blair House
acting as liaison on behalf of the Deputy Chief of Staff
between the First Family, Inaugural Committee Chairman and the
Transition scheduling office in planning inaugural and other
activities specifically involving The President and First Lady.
REAGAN-BUSH CAMPAIGN
1980
Adminsitrative Assistant
Served as Administrative Assistant to the Director of
Presidential Scheduling and Advance who was responsible for the
full day to day scheduling of the Presidential Candidate in the
General Election.
PRIOR TO 1980
Served in a variety of administrative positions with the Army
Intelligence and Security Command, the Army Security Agency and
the Defense Intelligence Agency.
-3-
PRESCOTT SHELDON BUSH, JR.
centrul files n
110 EAST 42ND STREET, SUITE 1300
NEW YORK, N.Y. 10017
FAX: 212-599-2235
TEL: 212-599-1409
August 28, 1992
The Honorable James A. Baker
Chief of Staff
The White House
Washington, DC 20500
Dear Jim:
It was good to see you at the Convention and to sit next
to Mike and Rita.
The enclosed letter, written to Senator Ed Pease in
October 1990 by my niece, Dr. Kelsey Kauffman, who has
a PhD in Criminal Justice, presents an idea that might
be a good part of the President's Crime Package.
I'm awfully glad you're back in charge in the White House
and wish you God Speed in your labors.
With warmest personal regard.
Sincerely,
Ches
encl.
PHOTOCOPYTING
82892jim.bak 82892j
MISC.
10 October 1990
Senator Ed Pease
P.O. Box 452
Brazil, IN 47834
Dear Ed,
I am writing to propose that Indiana establish a separate
correctional facility for female inmates and their young children.
To my knowledge, only one prison in the United States permits
children to remain with an incarcerated parent, a prison for women in
New York State which allows mothers to keep infants until the child
is one year old. The practice is more common in the rest of the
world. For example, in Australia (where I lived during the 1980s)
pre-school aged children can remain with their mother unless the
mother's conviction is for child abuse. In Argentina (where I had
the opportunity to visit women's prisons earlier this year) children
are accommodated until they are two years old.
As you are well aware, the incarceration rate for women in the USA is
rising even faster than it is for men. Much of the increase is due
to drug addiction. Many of the young drug-addicted women who go to
prison are also mothers. They often conceived unintentionally,
received little or no pre-natal care, gave birth prematurely, and
bore children with substantial physical, intellectual, and emotional
problems. Whether because of drug addiction, lack of parenting
skills, poverty, absence of other caring adults in the home, and/or
the special problems their children present--but not necessarly
because of lack of love or good intention--many incarcerated mothers
have failed in their role as parents.
When a woman is convicted and incarcerated in Indiana today, she can
take basic education or occupational training courses, participate in
drug therapy, and receive regular visits from her children, logistics
permitting. While the mother is in prison, her children may be cared
for by relatives (who may or may not be suitable substitutes), be
placed in one or more foster homes (which may, themselves, be less
than satisfactory), or, in the case of children born with drug
addictions, remain in a hospital.
When the mother is released she is frequently reunited with a child
who has even greater problems than before her incarceration, a child,
moreover, to whom she is in part a stranger. As the parent-child
relationship almost inevitably falters, 50, too, may the mother's
resolve to remain drug-free. The cycle perpetuates itself in two
senses: first with the mother's return to addiction, crime, and
incarceration; second, and more devastating from a societal
perspective, with the child's eventual involvement in the same
destructive patterns. The Indiana Boys' and Girls' Schools are
filled to capacity with children, some of whom are already parents
themselves, as the cycle begins for a third generation.
The facility I envision would offer the possibility of breaking this
cycle. Unlike the prisons in New York, Australia, and Argentina that
I have mentioned, where a few young children are housed along with
their mothers amidst a general prison population, the proposed
institution would be exclusively for incarcerated mothers and their
young children. The primary mission of the institution would be
enhancement of the parent-child relationship and the development of
child and mother. Also unlike the other facilities I mentioned,
where mothers often remain incarcerated long after their infants or
toddlers have been required to leave, mothers would enter the
proposed program only if their anticipated date of release was before
their child was old enough to attend school. The idea would be to
work with mother and child as a unit and prepare them for life
outside as a unit.
I see several important advantages of such an institution. By
preserving and enhancing the bond between mother and child, improving
parenting skills, and developing strategies by which the mother can
cope with her children's developmental problems, the mother may gain
and retain the most powerful incentive she may ever have to radically
alter her lifestyle on the streets. Her children, meanwhile, would
have the opportunity to develop in a safe and attentive environment
without being separated from the one person in their lives who really
loves them.
In addition to reducing recidivism by mothers in the program, and
helping to prevent future involvement in criminal behavior by their
children, the program may provide more tangible and immediate
benefits for Indiana taxpayers. The proposed institution would, I
estimate, cost considerably less overall than the combined cost of
incarceration for the mother and care for her children in foster
homes or hospitals. (A recent article in The New York Times noted
that the cost in California for keeping babies born to addicted
mothers in institutional care is $6,000 per month per child. Foster
parents willing to take "fragile infants" receive $1,729 per month
per child.) Costs for internal and external security should also be
substantially less at the proposed institution than in a typical
women's prison; morale among inmates and staff would be higher, and
incentives to escape minimized (not many mothers would seek to escape
leaving their children behind them). I also think the chances of
obtaining outside grants for the program would be excellent.
The Indiana Department of Correction is currently requesting twenty
million dollars for the first phase of a new women's prison. Now is
the time to consider a new direction in treating female offenders.
Although we have talked about prisons before, and I think I sent you
a copy of my book, Prison Officers and Their World (Harvard
University Press, 1988) last year, let me provide a bit more
information about my background. I worked as a prison officer in the
Connecticut Prison for Women in the early 1970s. Since then I have
studied prisons and written a number of popular and scholarly
articles about them, in addition to my book. I teach one course a
year at DePauw University on prisons. I hold a doctorate in
education from Harvard University, with a specialty in human
development. Also important given the nature of this proposal, I
have spent most of the past eight years being a nearly full-time
parent of three young. children, and consider that responsibility to
be the most important, challenging, and rewarding I have had in my
forty-three years.
I look forward to hearing what you think of my proposal.
Sincerely,
Kelsey Kauffman
609 Ridge Ave.
Greencastle, IN 46135
317-653-6225
to central
received 912
Files
no action
same letter
to Sec. Baker
GERALD F. FITZGERALD
DRAWERA
PALATINE, ILLINOIS 60078-8001
August 31, 1992
The Honorable James A. Baker
The White House
1600 Pennsylvania Avenue
Washington, DC 20500
The Honorable Samuel K. Skinner
The White House
1600 Pennsylvania Avenue
Washington, DC 20500
Gentlemen:
As a long-time observer of the political scene, I feel
motivated to make several observations:
1. President Bush should not be involved in the
assault on his Democratic opponent. It does not appear
presidential. To a lesser extent, the same holds true
with Vice President Quayle. Hardball should be left to
others.
2. President Bush is not perceived in general as being
a strong leader on domestic affairs and is having a
difficult time putting the blame on Congress where it
belongs. I suggest the following:
(a) the President should show his muscle with a
line item veto of a minor bill. This will reaffirm
presidential authority in the eyes of everyone. even if
it should fail a court test.
(b) Lastly, the President should index the capital
gains tax, again an assertion of presidential authority
and power. In my judgment, these would focus the fight
between the President and the Congress where it
belongs.
Respectfully yours,
Gerald F. Fitzgerald
Chairman of the Board
SUBURBAN
Suburban Bancorp. Inc.
50 North Brockway Street
BANCORP
Palatine, Illinois 60067-5064
708-359-1077
FAX 708-359-1687
178EOB
The Honorable Samuel K. Skinner
The White House
1600 Pennsylvania Avenue
Washington, DC 20500
GERALD F. FITZGERALD
DRAWERA
PALATINE, ILLINOIS 60078-8001
TRUSTWORTHY LOYAL
HELPFUL FRIENDLY COURTEOUS
KIND OBEDIENT CHEERFUL
THRIFTY BRAVE CLEAN
REVERENT
B
PREPARED
No. 02571
phone
You are cordially invited negnetted
to attend a
NATIONAL EAGLE SCOUT
COURT OF HONOR
Honoring
DANIEL GABRIEL HURLBURT
and
DAVID ANTHONY SWAN
of
South San Francisco Troop 281
at
Hillside Elementary School
1400 Hillside Blvd.
South San Francisco, California
Saturday, September 12, 1992
at 6:30 p.m.
Light Buffet
R.S.V.P. Jane Hurlburt
Following Ceremony
(415) 355-8102
Elizabeth Swan
(415) 756-8136
David Anthony Swan
412 HIGATE DRIVE
DALY CITY CA 94015-3903
Mrs. Elizabeth Swan
412 Higate Drive
Daly City, CA 94015
FRANCIS AAN AN PM AUG 31 OCCA AU Mo 200
992
THE HONORABLE JAMES A BAKER 111
SECRETARY OF STATE
WASHINGTON D C 20510
RICHARD L. PIEN
CENTRAL
Wednesday, September 2, 1992
NRN
Dear Mr. Baker:
09/8/92
Congratulations on your new Chairmanship
of BUSH*92*QUAYLE.
I look forward to completing my transition
to the White House following our introduction
by Jonathan Moore at Harvard's Institute of
Politics.
Sincerely,
James A. Baker
The White House
Washington, DC
20500
RICHARD L. PIEN
ADDRESS: 394 MARLBOROUGH STREET, BOSTON, MA 02115. TEL: (617) 437-0394
PROFESSIONAL SKILLS & EXPERIENCE
NEW ENGLAND
BUSH*92*QUAYLE
COMMITTEE
Sep 1991-Aug 1992
Republican Convention Delegate lists for New England, Embroidered Polo shirt fundraiser item.
*
New Hampshire rally, OH National Medical address, Thyroid Fnd Benefit, Harvard & Yale coordination.
Harvard JFK Sch of Gov IOP Study Grp: US-Pacific Rim Policy with Amb James R. Lilley, Fall '91.
Harvard JFK Sch of Gov IOP Study Grp: Road to the White House with John Ellis, Spr '92.
MASSACHUSETTS
WELD FOR GOVERNOR
FINANCE COMMITTEE
May 1989- Jan 1991.
Transition Committee, Inc.: candidate since 11/6/90; MRP Finance Cmte appointment: 8/1/91.
Harvard JFK Sch of Government IOP Study Grp: The new Weld administration Spr '91.
Interfaced Weld endorsements by US Pres Bush, US Vice-Pres Quayle, Sec E. Dole.
Speech proposals, fund-raising, endorsements, State Cmte caucus, convention, SJC, debates.
21st US Decennial Census: May 1990 Hatch Act restriction for Back Bay Nonresponse Follow-up.
GREATER BOSTON
GEORGE BUSH FOR PRESIDENT
PRECINCT CAPTAIN
Feb 1987- Jan 1989.
Proposed speaking engagements for Vice-Pres Bush: Yale & Harvard Clubs of Boston, Wang Labs.
Office guests included Secretary of State Henry Kissinger & Secretary of Education William Bennett.
Grass roots organization & formation of Massachusetts steering committee.
Harvard JFK Sch of Government IOP Study Grps: The White House Fall '89, Inside Baseball Spr '91.
Yale Political Union introduction to Chubb Fellow George Bush, Timothy Dwight, 1977.
NEW ENGLAND REGIONAL
U.S. TREASURY-INTERNAL REVENUE SERVICE
REPRESENTATIVE
Jan 1985-Jan 1987.
Acquired skills in individual and employment tax law and regulation.
Represented IRS Taxpayer Service for New England and part of New York.
DISTRICT MANAGER
FIRST FEDERAL AIR TRAVEL PASS ON AIR FLORIDA
MARKETING/SALES
Dec 1982-Jun 1984.
Developed and executed training program & telemarketing program. Wrote training manuals.
Directed Boston office of 3 assistant managers, 3 secretaries, 35 sales consultants.
Supervised highest productivity office in New England, New York City, Washington, DC.
RESEARCH
RESEARCH ASSISTANT
IMMUNOGEN CORPORATION, Boston, MA
Aug 1981-Apr 1982.
Verified the cytotoxicity of Adriamycin and Daunorubicin in treatment of cancer.
General adviser Nobel Laureate '81, White House National Medal of Science '90.
SENIOR THESIS
YALE SCHOOL OF MEDICINE, New Haven, CT
Jan 1978-Aug 1978.
Senior Thesis: research endorsed by Nobel Laureate '74 on specific inactivation of marker enzymes.
INTERNATIONAL
GRAND TOUR
ORIENT: CHINA, JAPAN, HONG KONG
May 1979-Aug 1979.
*
Hosted by US Ambassador to the Republic of China & Citicorp Citibank ROC Head Officer.
RELATED SKILLS
LANGUAGES
French & Chinese Mandarin
MICROCOMPUTERS
Macintosh, IBM, & Forth generation languages
EDUCATION
HARVARD UNIVERSITY
*
Advisory Committee, Harvard Extension Alumni Association, Appointed Sep 1991.
Harvard University Extension, Cambridge, MA, C.S.S. One year Harvard M.B.A., Finance, Honors,
Harvard Law School Quadrangle. May 1988-Jun 1989.
Graduate School of Arts & Sciences, Cambridge, MA, Gp. One year graduate program, Division of
Medical Sciences, Harvard Medical School Quadrangle. Sep 1980-May 1981.
YALE UNIVERSITY
*
Yale College, New Haven, CT, B.A. Molecular Biophysics & Biochemistry. Sep 1975-May 1979.
Senior Thesis endorsed by '74 Nobel Laureate* Advanced Placement: Freshman English & Calculus.
HAWKEN SCHOOL
Preparatory Secondary School, Gates Mills, OH, Honors. Sep 1971-May 1975.
*
Harvard College Secondary School Program, Summer 1974, Weld Hall.
SAT: Verbal 600/Math 720, ACH: Math II 770.
Extracurricular Activities
Varsity Roster Squash Racquets, Tennis, Classical Music, Photography.
THE WHITE HOUSE
WASHINGTON
August 21, 1992
Dear Mr. Pien:
On behalf of President Bush, thank you for
your kind words of support and the
Bush/Quayle '92 polo shirt. I know the
President appreciates your kind gesture.
In the months ahead we will definitely need
active campaigners such as yourself letting
people know what a great President they have
in George Bush. Glad to see that New England
is in good hands.
Thank you again for the thoughtful gift.
Sincerely,
M.Kupm
Deputy Assistant to the President
for Political Affairs
Mr. Richard L. Pien
394 Marlborough Street
Boston, MA 02115
TFF
The Thyroid Foundation of America, Inc.
Honorary
National Director
Pat Bradley. L.P.G.A.
Medical
Advisory Council
David V. Becker. M.D.*
Orlo H. Clark. M.D.
David S. Cooper. M.D.*
Francis S. Greenspan. M.D.
Joel I. Hamburger. M.D.
(Ex-Officio)
August 14, 1992
Elliot G. Levy, M.D.
E. Chester Ridgway, M.D.
Clark T. Sawin, M.D.
Martin I. Surks. M.D.
Mr. Richard L. Pien
Lawrence C. Wood, M.D.
394 Marlborough Street
Business
Boston, MA 02115
Advisory Council
United States of America
Mr. George R. Baldwin*
Mrs. Judith A. Brodkin
Mr. Louis W. Cabot
Mr. George M. Collins. Jr.
Dear Mr. Pien:
Eugene W. Downing, Jr., Esq.
Mr. David G. Falwell
Mrs. Judith T. Fulkerson
Thank you for sending me a copy of that special
Ms. Jeannette Hargroves
note which you sent to First Lady Barbara Bush.
Ms. Patricia T. Kosinar
Mr. Donald J. MacMillan*
I am pleased that you were able to attend that
Mr. John W. MacNeil
Ms. Jeanne K. Macmillan
special Educational Forum and luncheon in honor
Ms. Stephanie A. Martini
of Mrs. Bush.
Mr. Richard J. McDermott
Mr. H. Calvin Place
I know she is pleased to have you inspired to
Mr. Robert J. Sales
Mr. Robert Shamroth
campaign on the New England Committee for the
Mrs. Marion Soupios Shichman
President.
Mr. Charles Small
*Board of Directors
Sincerely,
Officers
President
Cere Ceel
Lawrence C. Wood, M.D.
Lawrence C. Wood, MD, FACP
Treasurer
President/Medical Director
Ms. Jeannette Hargroves
Clerk
Ms. Lora S. Hammer
LCW:syn
Staff
cc: First Lady Barbara Bush
Medical Director
Lawrence C. Wood. M.D.
Director of Operations
Nancy K. Cohn
Director of Special Events
Helen Claire Sievers
Assistant Director for Membership
Ms. Lora S. Hammer
Assistant Director for Development
Ms. Pamela J. Quattrocchi
Newsletter Editor-in-Chief
Mrs. Ruth Hapgood
Ruth Sleeper Hall 350, Massachusetts General Hospital, Boston, MA 02114
Phone (617) 726-8500
Fax (617) 726-4136
9/4- CJ called Gilbert Scott to
PERSONAL TO CENTRAL
say that JAB could not possibly
intervene on this sort of thing
totally inappropriate. Empathized
August 25, 1992 with his
2213 Eastwood Drive feelings as
Richardson, TX 75080 a father;
Tel: (214) 234-0481 sorry we
couldrithelp.
Mr. James A. Baker, III
The White House
Washington DC 20500
Dear Jim:
It has been 45 years since we were at The Hill
School during the 1946-47 school year. I lived in
Hillrise and had occasion to come to know you. 1 have
watched your accomplishments through the recent years
with great interest and congratulate you on the
wonderful success you have had in your political and
diplomatic activities. 1 am pulling for you and The
President to do your magic and win this one too.
Heaven only knows the country cannot stand another
Carter style presidency.
1 am writing you for help to save a young man, my
son Cadet Andrew B. Scott, from a very unjust
separation from the United States Military Academy.
My intention is to make this letter brief, for I
feel it is far more important for you to take your time
to read the case file and the enclosed sampling from
over 100 letters sent to DA and added to the case file.
The letters are by Andrew's peers, professors, and
life-long associates. This is my purpose
I ask you
personally to read all of this. Only then can you
perhaps understand that this is a case of principle,
not one of emotion. Only then can you begin to
understand who Andrew is, who he dreams of becoming,
what he has the capabilities of being and thus why he
seeks a reversal in this decision.
The Department of the Army seems to abhor reversing
a decision of the Superintendent of the USMA no matter
how unjust and it may be. I am asking for your help to
insure that a truly unbiased evaluation and just
decision is made and returned to West Point by the
Department of the Army.
As his father, I am not asking the impossible; I am
only asking for that which is right and just in the
decision process.
Gratefully,
Gl
GILBERT T. SCOTT
The Hill Class '47
USMA Class '52
P.S. A complete file was sent to President Bush in late
June and a second letter was promised to be delivered
to him by his Physician when he visited the Super
Conducting Super Collider in Texas.
G.T.S.
URGENTIL LEASE READ IMMEDIATELY. ACTION PENDING.
Jerry L. Livezey
3360 Southlake Park Road
Southlake, Texas 76092
817+329-9058
July 27, 1992
President George Bush
Executive Office of the President
1600 Pennsylvania Ave. N.W.
Washington, D.C. 20500
RE: For inclusion in the file of
Cadet Andrew Scott, United
States Military Academy
Dear Sir,
I am writing this letter to urge you to intercede in the
decision to separate Cadet Andrew Scott from the United States
Military Academy.
This decision was a tragic mistake for several reasons. I
am enclosing a copy of the letter I forwarded to General Graves,
Superintendent of United States Military Academy, outlining my
objections.
I would also urge you to recommend education and counseling
for General Graves and his staff regarding the purpose,
tradition, and operation of the Cadet Honor Code at West Point.
The Honor Code and Honor System belong to the Corp of Cadets, but
control of the Code has been taken over by the regular Army
officers involved. They appear to totally ignore the input of
the Corp Honor Representatives, contrary to the published
guidelines of the Honor Code.
Sir, the Honor Code is one of the foundations of the United
States Military Academy at West Point. Please do not allow
misguided Army officers to undermine its values and
effectiveness.
I trust you will assist in correcting this dreadful mistake
for the good of the Corp of Cadets, the United States Army, the
American taxpayer, and Cadet Andrew Scott.
Sincerely,
Jerry L. Livezey
TIFCO INTER-AMERICA
7125226620
P.01
Central
3 Sept 92
To: James A. Baker 111 Fax 202 456 2397
From: Peter C. Maffitt Fax 713 522 6620 tel: 713 523 6869
Re: Nov, 1992 Election
Dear Jim,
It is absolutely essential that the President be re-
elected. What can I do to be of help?
In the past few months I have been in Chicago, Wash DC,
Miami, SL. Louis, and Denver. I have never felt such
politcal anger, economic fear, and indifference. George
does best when faced with as challenge, but how did we
get in such a situation. For example, we have a cousin who
is as strong a Republican as possible, but his wife will
not put a Bush sticker on her car in Houston for fear someone
will damage her car. I have a college roommate who is a
life-time Republican who is totally turned off by the
President. We have an elderly aunt who is furious over the
abortion issue. The anger goes on and on.
I had a Media pass at the Convention. From conversations
and what I read, the Media is as hostile as I have every
seen it towards the President.
The issue now is how to turn this negative voting feeling
around.
You may not be aware of the extend of job fear related to
LAFTA. I am getting several calls on how to move a US factory
to Mexico, but Carla Hill is going around the nation trying
to tell workers that LAFTA will create jobs in US. From a
statesman issue LAFTA makes great sense, but has anyone
looked closely at the short-turn political results? People
are very fearful of globalization and Clinton isolationism
is very appealing to a broad sector of the US.
I hope that when the American public gets to the voting
booth he or she will put aside the anger and emotions and
vote with reason.
Sincerely,
Peter
Peter C. Maffitt
File.
9/9/92
no response messary
B Montague
BARBARA CHRISTIE
5305 CROMWELL DR
BETHESDA MD 20816 06AM
WESTERN UNION MAILGRAM®
UNITED STATES
POSTAL SERVICE
1-001742K250 09/06/92 ICS IPMBNGZ CSP WHSB
3013204904 MGMS TDDA BETHESDA MD 60 09-06 0220P EST
THE HONORABLE JAMES BAKER
STAFF DIRECTOR WHITE HOUSE
WASHINGTON DC friend? 20500
DEAR JIM
MAY I MEET WITH YOU AS SOON AS CONVENIENT
IF FORWARDED CORRESPONDENCE ON ISSUES INVOLVED WHERE I HAVE KNOWLEDGE
AND EXPERIENCE. HAVE TRIED TO HELP THE PRESIDENT SINCE 1979. CAN
RENDER A CONTRIBUTION IN THE EFFORT TO REELECT PRESIDENT UNDER YOUR
ADROIT GUIDANCE.
RESPECTFULLY
ALEXANDER K CHRISTIE
14:16 EST
MGMCOMP
MGM CS (10/89)
To reply by Mailgram Message, see reverse side for Western Union's toll-free numbers.
TO REPLY BY MAILGRAM MESSAGE, PHONE WESTERN UNION ANYTIME, DAY OR NIGHT:
FOR YOUR LOCAL NUMBER, SEE THE WHITE PAGES
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DIAL (TOLL-FREE) 800-325-6000
THE WHITE HOUSE
WASHINGTON
September 2, 1992
MEMORANDUM FOR PHILLIP D. BRADY
ASSISTANT TO THE PRESIDENT AND
FROM:
JAMES STAFF A. SECRETARY BAKER, III JAB
CHIEF OF STAFF AND SENIOR COUNSELOR
TO THE PRESIDENT
SUBJECT:
COMMISSION REQUEST
Please have a Commission prepared for the following person:
NAME:
David Q. Bates, Jr.
TITLE:
Assistant to the President and Special
Assistant to the Chief of Staff
STATE:
Texas
Thank you.
THE WHITE HOUSE
WASHINGTON
September 8, 1992
MEMORANDUM FOR PHILLIP D. BRADY
ASSISTANT TO THE PRESIDENT AND
FROM:
JAMES STAFF A. SECRETARY BAKER, III JAB
CHIEF OF STAFF AND SENIOR COUNSELOR
TO THE PRESIDENT
SUBJECT:
COMMISSION REQUEST
Please have a Commission prepared for the following person:
NAME:
Thomas A. Scully
TITLE:
Deputy Assistant to the President and
Counselor to the Director, Office of
Management and Budget
STATE:
Virginia
Thank you.
THE WHITE HOUSE
WASHINGTON
September 8, 1992
MEMORANDUM FOR PHILLIP D. BRADY
ASSISTANT TO THE PRESIDENT AND
FROM:
JAMES STAFF A. SECRETARY BAKER, III JAB
CHIEF OF STAFF AND SENIOR COUNSELOR
TO THE PRESIDENT
SUBJECT:
COMMISSION REQUEST
Please have a Commission prepared for the following person:
NAME:
Chester Paul Beach, Jr.
TITLE:
Associate Counsel to the President
STATE:
Virginia
Thank you.
THE WHITE HOUSE
WASHINGTON
September 8, 1992
MEMORANDUM FOR PHILLIP D. BRADY
ASSISTANT TO THE PRESIDENT AND
FROM:
JAMES STAFF A. SECRETARY BAKER, III JAB
CHIEF OF STAFF AND SENIOR COUNSELOR
TO THE PRESIDENT
SUBJECT:
COMMISSION REQUEST
Please have a Commission prepared for the following person:
NAME:
Gary L. Foster
TITLE:
Deputy Assistant to the President for
Special Events
STATE:
Texas
Thank you.
SENT BY:OFF OF GERALD R. FORD ; 9-10-92 11:10AM ;
X- West Wing (1st Fir) :# 2
NRN
GERALD R. FORD
September 10, 1992
Dear Jim:
Here is my letter to the Editor of the Denver Post and
a copy of how the Post used it.
On Monday, September 14th, I am doing a press
conference in San Diego on the same subject.
Best regards,
The Honorable James A. Baker III
Chief of Staff
The White House
1600 Pennsylvania Avenue
Washington, D.C. 20500
SENT BY:OFF OF GERALD R. FORD ; 9-10-92 111:10AM ;
X- West Wing (1st Flr) ;# 3
GERALD R. FORD
September 9, 1992
Dear Mr. Editor:
Your Editorial - "There was only one Truman," disturbs me as it
ignores two fundamental Truman-Bush similarities in contrast to
several serious Clinton differences with the two Presidents.
Recently, I saw and heard Governor Clinton discuss President
Bush and President Truman.
Let me expand it to include Governor Clinton, as well.
In WWI, President Truman fought courageously in combat in
Europe as an officer in the U.S. Army.
In WWII, President Bush was the youngest combat Navy pilot and
was shot down by enemy forces in the Pacific War.
Governor Clinton and several of his relatives in contrast,
manipulated and maneuvered so he did not serve in the Armed
Forces while the U.S. was at war.
Both Truman and Bush, obviously believed that military
service in wartime was an obligation of citizenship and an act
of patriotism. Governor Clinton did not.
Let me add another contrast between the two Presidents on the
one hand and Governor Clinton on the other.
In June 1950, President Truman, under the auspices of the U.N.,
committed U.S. Armed Forces to meet the invading communist
forces in Korea that ware challenging the national interest of
America and its allies.
(Continued on Page Two)
SENT BY:OFF OF GERALD R. FORD ; 9-10-92 :11:10AM ;
X- West Wing (1st Fir) :# 4
In 1991, President Bush, also under the auspices of the U.N.,
committed U.S. Armed Forces to protect America's national
interest against the middle east invasion by Saddam Hussain.
In 1991, Governor Clinton in the Gulf Crisis opposed the
decision of President Bush, a majority of the members of the
House and Senate and the members of the U.N. Security Council.
Again, Truman and Bush reacted similarly - firm activists
against military aggression in opposition to U.S. national
interest.
Here is Governor Clinton's response in this foreign policy
crisis:
"I agree with the arguments of the people in the minority on
the resolution - that we should give sanctions more time and
mayba even explore a full-scale embargo before we go to war."
(1/15/91)
"I guess I would have voted with the majority if it was a close
vote. But I agree with the arguments the minority made."
(1/15/91)
How's that for a Profile in Courage.
Best wishes
Heald R. Ford
Mr. F. Gilman Spencer
Editor
The Denver Post
1560 Broadway
Denver, Colorado 80202
SENT BY:OFF OF GERALD R. FORD ; 9-10-92 :11:11AM
X- West Wing (1st Fir) 5
THE DENVER POST
Thursday, September 10, 1992
in
at
aly
Former President Ford lauds Bush, derides Clinton
Truman had no liking
for a GOP president
Your editorial "There was only one
lenging the national interest of America
he
Truman," (Post, Sept. 9) ignores two fun-
and its allies.
damental Truman-Bush similarities in
In 1991, President Bush, also under the
President Bush wants to compare his
contrast to several serious Clinton differ-
campaign to that of President Truman. In
auspices of the U.N., commited U.S.
ences with the two presidents.
armed forces to protect America's na-
"Plain Speaking: an Oral Biography of
Recently, I saw and heard Governor
tional interest against a Middle East in-
Harry $ Truman" by Merle Miller, Presi-
Clinton discuss President Bush and Presi-
vasion by Saddam Hussein.
dent Truman had this to say about a Re-
dent Truman. Let me expand it to include
publican president: "He'll look out for the
In 1991, Governor Clinton in the Gulf
Governor Clinton, as well.
Crisis opposed the decision of President
rich and squeeze out the farmer and the
In World War I, President Truman
Bush, a majority. of the members of the
small business man. Somebody who'll do
fought courageously in combat in Europe
House and Senate and the members of the
everything in his power to make the rich
as an officer in the U.S. Army.
U.N. Security Council.
richer and the poor poorer."
In World War II, President Bush was the
GLENN BAKKER
Again, Truman and Bush reacted simi-
youngest combat Navy pilot and was shot
Tabernash
larly - firm activists against military
down by enemy forces in the Pacific War.
5-
aggression in opposition to U.S. national
Governor Clinton and several of his
interest.
relatives, in contrast, manipulated and
Here is Governor Clinton's response in
Hornby's column stirred up
maneuvered so he did not serve in the
this foreign policy crisis:
a little guy's resentment
11-
armed forces while the U.S. was at war.
"I agree with the arguments of the peo-
Both Truman and Bush obviously be-
ple in the minority on the resolution -
is
lleved that military service in wartime was
that we should give sanctions more time
I'm writing about Bill Hornby's col--
an obligation of citizenship and an act of
and maybe even explore a full-scale em-
umn, "Time to buy insurance on Colorado
patriotism. Governor Clinton did not.
bargo
before we go to war." (Jan. 15)
schools" (Post, Aug. 27).
-2
Let me add another contrast between
"I guess I would have voted with the
Why is it that most of you in the media
the two presidents on the one hand and
majority if it was a close vote. But I
reside in liberal wonderland? For Hornby
4
Governor Clinton on the other.
agree with the arguments the minority
to say this isn't a political issue of Repub-
le
In June 1950, President Truman, under
made."
licans VS. Democrats is to ignore the basic
the auspices of the U.N., committed U.S.
How's that for a Profile in Courage?
notion of how these "acts" come about.
armed forces to meet the invading com-
GERALD R. FORD
This indeed is a political issue, pitting
munist forces in Korea that were chal-
AVON
those who are fiscally responsible (Re-
-
publicans) against those who believe the
as
only way to govern is with scare tactics,
e.
Post didn't do its homework on Florida codes
i.e. our children, and more taxes (Romer,
Democrats).
ill
With a daughter, 5, and a son, 15
I must take strong exception to your
many lose their houses, but their places of
months, I do believe in children first. I
editorial of Aug. 27 on the violence of na-
employment are also gone. My sister's
also believe in the Constitution and the
p-
ture. I was born in South Florida and
Sub Shop in Homestead no longer exists.
right not to be taxed unfairly.
ty
lived there for 39 years, having moved to
She donated 82,000 worth of frozen meat
Governor Romer thinks every time
Denver one week ago.
to a shelter. Many others are doing simi-
there is a shortage the only answer is to
You obviously did not do much home-
lar things without regard to their pockets.
raise taxes. This time he wants to create
work on the building codes of the area. By
Your writers should be expressing
the third-highest sales tax among major
code, structures must be able to with-
shock over the bureaucratic delays in dis-
U.S. metro areas - higher than Boston,
stand winds of 120 mph. What is, in your
tribution of food, water, fuel, etc. The
New York or Los Angeles.
in
words, "a more typical hurricane"?
United States can get aid to other coun-
Quit with your scare tactics, Hornby.
There has not been à storm of this magni-
tries quicker than within Its own borders.
We have a great deal of options at our
tude in South Florida since 1935. How
Instead, your writers are advocating a
disposal before we again go to John Q.
he
high do you go with the codes, 180-200-225
slower process for handling the federal
Public for more hard-earned money.
mph? The costs, contrary to your state-
loans. Easy to do, I guess, from the pro-
Why not impose a small tax on gam-
ment, would be staggering.
verbial "Ivory Tower."
bling and apply it to our schools? But
The people In South Florida have
PATRICK J. SULLIVAN
leave us little guys out of it.
id
enough worries right now. Not only did
Arvada
MARK J. FARROW
Englewood
a-
When not collected, fossils just weather away
Don't revile nursing homes
he
on
Some glaring inaccuracies and omis-
bureaucrats would restrict fossil collect-
to
sions in "Fossil fans have bone to pick"
ing on public lands and elevate fossil col-
Regarding Laura Hershey's recent Post
al
(Aug. 26) need to be taken up by your le-
lecting to almost the level of drug crimes,
column on nursing homes: I agree that:
gal affairs writer.
with seizure, fines, vehicle confiscation
some are better than others, and that
y,
A group of professional fossil collec-
and even jail time possible. Hunters, rock
there are inherent problems with them.
tors, having leased collective rights from
collectors and all people who have ever
But please don't denounce and degrade
ce
a tribal member owning the land, had
picked up a pretty rock, beware - you
them as you do.
of
their find seized by the government with-
may soon be a criminal
They are places for individuals who re-
ouire 24-hour supervision. not just "help":
SENT BY:OFF OF GERALD R. FORD ; 9-10-92 11:12AM ;
X-
West Wing (1st Flr) # 6
68
Wednesday, September 9, 1992
THE DE
THE DENVER POST
Mike Keefe
F. GILMAN SPENCER
WILLIAM DEAN SINGLETON, Chairman
Editor
DONALD F. HUNT, Publisher
CHUCK GREEN
Editor of the Editorial Page
RYAN McKIBBEN
Executive Vice President and General Manager
NEIL WESTERGAARD
RICHARD JACOBS
Executive Editor
Senior Vice President, Administration and Operations
WILLIAM H. HORNBY
KIRK MacDONALD, VP Advertising FRANK DIXON, VP Operations
Senior Editor
FRITZ ANDERSON, VP Finance
STEVE HESSE, VP Circulation
JAMES BANMAN, VP Human Res
KEN CALHOUN, VP Marketing
There was only one Truman
HARRY TRUMAN might be
But Bush hasn't done his home-
than heck, or some-
work well enough. While it is true
thing to that effect, if he knew
that Truman eventually tri-
how his reputation was being bor-
umphed despite dismal opinion
rowed by lesser men. Truman
polls, Truman was able to recap-
was a one-of-a-kind, no-nonsense,
ture voters' loyalty by reminding
down-to-earth, decisive, this-is-
them of who he was and what he
where-I-stand kind of fellow. He
stood for - the very qualities
stood up to the Chinese in Korea
that Bush has difficulty defining.
and dressed down Gen. Douglas
Besides, when Truman railed
MacArthur when the time came.
against a do-nothing Congress, he
The 33rd president pushed the
could make the charge knowing
Marshall Plan on the European
that he had put forward a well-
READEI
front and the Fair Deal on the
conceived domestic agenda that
home front. Sure, he complained
lawmakers had failed to enact.
Bannir
about a do-nothing Congress -
Bush, by comparison, has govern-
but he made it clear that the buck
ed largely by veto, not by vision.
stopped at his desk. His mantle
And Truman might be appalled at
I read with gre:
should not be lent lightly to any
Bush's past resistance to new civ-
column by Richard
politician.
11 rights laws.
sue of 25 to 28 pel
Yet of the two presidential con-
Bush also has a problem with a
day 18 indeed terr
Reeves's conclusio
tenders who now are trying to be
little-reported nuance of history
1. Where does R
the new Truman, George Bush
that undermines his claim to be
handguns were use
has the lesser claim. Bill Clinton,
able to overcome poor poll stand-
sibly some type of
if his campaign rhetoric is to be
ings.
Reeves seems fixa
believed, at least understands
One problem pollsters had with
2. The crime 0
that America must be strong in-
predicting Truman's re-election
away just because
ternally if it is to be a world lead-
was that public survey techniques
harder to possess
clubs, fists or even
er. His people-first policies might
in the late 1940s were very primi-
also offer an opp
fit right into the thinking of the
tive and S0 failed to account for
someone in.
plain-spoken man from Missouri
the sentiments of large numbers
3. Yes, let's adc
who was the first president since
of middle- and lower-income vot-
reaucracy with th
Reconstruction to promote a civil
ers. Truman therefore may never
rights agenda.
really have been behind in public
affection, as the poll numbers in-
Parach
George Bush, in contrast,
claims to be the new Harry Tru-
dicated.
man simply on the basis of com-
But for the last four decades,
Parachute has a
ing from behind to win the politi-
pollsters have labored intensely to
shale "boom and by
cal horse race. He seems to have
avoid similar mistakes, so today,
"boom and bust" B
looked at his own ratings, then
thanks to better survey methods,
astating and long
opened the history books and
it is undeniable that Bush's popu-
town and its reside
I think that it W
picked out a president whose situ-
larity truly has sagged.
the people who live
ation appears to fit his own sorry
The difference may prove deci-
that Mayor Beasle
dilemma.
sive come Election Day.
gambling initiative
Martel & Associates
NRN
Executive Communication Counsel
9/10- offin Beth" is to called thank
Myles Martel, Ph.D.
President
August 26, 1992
The Honorable James Baker, III
Chief of Staff
The White House
Washington, DC 20006
Dear Jim:
Congratulations on your new position. I am so pleased that
you're now in charge.
For the past 12 years -- since we were last together -- I've
worked on 200 plus debates. The enclosed manual should be
helpful in shaping President Bush's debate strategy.
In warm friendship, and with every good wish.
Very sincerely yours,
Myles Martel
ONE ALDWYN CENTER, VILLANOVA, PENNSYLVANIA 19085
215-525-5959
Fax: 215-525-4476
POLITICAL CAMPAIGN DEBATES:
IMAGES, STRATEGIES, AND
TACTICS
DEBATE PREPARATION GUIDE
Myles Martel, Ph.D.
Martel & Associates
POLITICAL CAMPAIGN DEBATES:
IMAGES, STRATEGIES, AND
TACTICS
DEBATE PREPARATION GUIDE
Myles Martel, Ph.D.
Copyright, 1992, Martel & Associates
Martel & Associates
TABLE OF CONTENTS
TITLE
PAGE
Net Effects Goal-Setting Process
1- 5
Planning Political Debate Strategy
6 - 7
Substance Goal-Setting Process
8
Image Goals
9
Major Tactics for Debates
10
Managing Hostility
11
Banana Peels
12 - 14
Debate Headlines
15 - 16
Debate Preparation Plan
17 - 24
Martel & Associates
WORKSHEET
THE NET EFFECTS GOAL-SETTING PROCESS
SHAPING YOUR DEBATE STRATEGY
Step 1.
Designate your target audience(s) for the intended communication, and identify
where they fall in relation to the bull's eye (your most important target audience).
a.
Males
i.
Size of family
b.
Females
j.
Union affiliation
c.
Age parameters
k.
Political affiliation
d.
Religious preference
1.
Voting profile
e.
Racial origin
m.
Interest in election
f.
Socio-economic status
n.
Attitude re: candidate
g.
Education
O.
Attitudes re: specific issue positions
h.
Geographic area
p.
Other
Step 2.
Once you analyze each target audience in terms of relevant demographics,
knowledge level and attitudes, ask throughout the entire Goal-Setting Process:
1. How relevant is each demographic factor or combination of demographic factors
to your overall debate strategy?
2. How does the relevance of any of the above affect the ideas or language you
select, the extent to which you rely on emotional VS. logical appeals, the types of
examples you choose, and the degree of technicality of your presentation?
3. To what extent is the audience familiar with the issues you are presenting and
with you and your campaign? To what extent does their degree of familiarity affect
how you shape your approach to the debate?
1
Martel & Associates
Worksheet - The Net Effects Goal-Setting Process - Page Two
Step 3.
Define in precise terms the attitudinal and/or behavioral support you are immediately
or ultimately seeking from your target audience(s).
Principal Goals:
1.
Quantifiable electoral support from one or more specific target audiences.
2.
Quantifiable elevated name recognition.
3.
Reinforcement of support base (quantifiable)
4.
Added legitimacy to campaign (quantifiable)
5.
Prevention of erosion resulting from a less than impressive performance (Risk
averse pressured obligation vs. opportunity)
6.
A combination
7.
Other
Rank order on a 1-5 scale (1=low significance, 5=high significance) the
significance of the following objectives in achieving your goal(s):
I.
Differentiating
The ability to differentiate myself from my opponent(s) on the basis of:
1.
Issue positions/votes
Specify:
2.
Experience
Specify:
3.
Accomplishments
Specify:
4.
Character
Specify:
5.
Image/Personality
Specify:
6.
Party
Specify:
7.
Campaign
Specify:
8.
Vision/Philosophy
Specify:
9.
Other
Specify:
How important is selling to the process of differentiating?
Specify:
How important is defending?
Specify:
How important is attacking?
Specify:
2
Martel & Associates
Worksheet - The Net Effects Goal-Setting Process - Page Three
A.
Selling
1.
The ability to "sell" my issue positions in general
2.
The ability to "sell" my issue positions on the following topics:
a.
Education
b.
Jobs
c.
Healthcare
d.
Crime in general
e.
Urban crime
f.
Drugs
g.
Economic development
h.
The economy
i.
Tax policy
j.
Foreign affairs
k.
Trade
1.
Defense
m.
The environment
n.
Transportation
O.
Social security
p.
Agricultural policy
q.
Other
3.
The ability to "sell" the more relevant aspects of my experience,
specifically:
4.
The ability to "sell" my accomplishments, specifically:
5.
The ability to "sell" my vision/philosophy:
6.
The ability to "sell" my image, personality/character:
3
Martel & Associates
Worksheet - The Net Effects Goal-Setting Process - Page Four
B.
Defending
The ability to "defend" against existing or probable attack my:
1.
Issue positions/votes
Specify:
2.
Experience
Specify:
3.
Accomplishments
Specify:
4.
Character
Specify:
5.
Image/Personality
Specify:
6.
Party
Specify:
7.
Campaign
Specify:
8.
Vision/Philosophy
Specify:
9.
Other
Specify:
C.
Attacking
The ability to attack my opponent(s) on the basis of:
1.
Issue positions/votes
Specify:
2.
Experience
Specify:
3.
Accomplishments
Specify:
4.
Character
Specify:
5.
Image/Personality
Specify:
6.
Party
Specify:
7.
Campaign
Specify:
8.
Vision/Philosophy
Specify:
9.
Other
Specify:
II.
Agreeing/Aligning
1.
With advisability of actions taken by opponent
2.
With opponent's assessment of a problem (its nature and scope)
3.
With opponent's goals for resolving the problem.
4.
With opponent's analysis of the cause of a problem
5.
With element(s) of the opponent's proposed solution
6.
With element(s) of the opponent's vision
7.
Other
If agreeing/aligning seems strategically advisable and tactically feasible,
specify the focus of the alignment, its rationales (e.g., to project a
statesmanlike image, to highlight or sharpen distinctions despite points of
commonality), and how the alignment will be executed.
How helpful or risky is aligning? (implicitly or explicitly)
Specify:
4
Martel & Associates
Worksheet - The Net Effects Goal-Setting Process - Page Five
Step 4.
Define in precise terms the behavior you must prevent from occurring within your
target audience:
Are you seeking to prevent:
Erosion of support (psychological, financial, etc.)
Protest
Deterioration of Morale (within campaign and support base)
Anticipated misperceptions of fact
Release of sensitive information
Speculation/rumor
The perception of negligence
Public concern or fear
The highlighting of a distracting/potentially
embarrassing negative
Undue optimism/pessimism
Something else?
1.
What principal values underpin the most salient issue positions selected for
your debate strategy?
Puritan and pioneer morality, or the willingness to cast the world into
categories of foul and fair, good and evil, and so forth.
Value of the individual, or the ranking of the rights and welfare of the
individual above those of government and as important in other ways.
Achievement and success, or the accumulation of power, status,
wealth, and property.
Change and progress, or the belief that society develops in positive
ways measured by progress.
Ethical quality, or the view that all persons are equal in a spiritual
sense and ought to be in a realm of opportunity.
Effort and optimism, or the belief that hard work and striving will
ultimately lead to success.
Efficiency, practicality, and pragmatism, or the value placed on
solution-oriented as opposed to ideologically-oriented thinking.*
2.
What is the specific nature of the media coverage needed to enhance the
likelihood that your Net Effects Goal(s) will be achieved.
Summarize your Net Effects Goals based on the exercise performed above:
*Edward D. Steele and W. Charles Redding, "The American Value System:Premises for Persuasion," Western Speech, Vol. 26 (Spring
1962), pp. 83-91.
5
Martel & Associates
Planning Political Debate Strategy
Pinpointing Candidate Strengths and Opponent Vulnerabilities
A.
Issue Positions -- on basis of:
Overall Philosophy/Ideology
Logic
Evidence/Methodology
Values or Principles
B.
Record:
Competence-related experience
Attendance, votes and committees
Votes (general voting pattern and specific votes)
Legislative Initiatives
Interest Group Ratings
Actions (with emphasis on results achieved or failures)
Inaction
Other:
C.
Character/Credibility:
Honesty/Dishonesty/Sincerity of actions or motives
Goodwill
Loyalty
Adherence to family or religious values
6
Martel & Associates
D.
Other Potentially Relevant Characteristics:
Academic Background
Influence/Clout
Accessibility
Intelligence
Ambition
Marital Status
Community Service
Old Age
Effectiveness
Religious/Ethnic Affiliation
Energy Level
Residency
Family Image
Veteran
General Temperament
Wealth
Health
Youth
Other:
E.
Campaign -- on basis of:
Winability/Electability
Management Quality
Campaign Tone
Communication of issue positions
Control (appropriate or inappropriate) of candidate's exposure
Tactical Improprieties ("Dirty Tricks")
Financial Improprieties
Campaign Spending Practices
Media Relations
Supporters, persons and interest groups (endorsements)
Strength of support from own party. Opposite party.
Willingness or unwillingness to debate
7
Martel & Associates
WORKSHEET
THE SUBSTANCE GOAL-SETTING PROCESS
THE MARTEL METHOD
STEP 1
Pinpoint the key arguments/points needed to modify the targeted attitudes
toward your or your opponent's record, issue positions, character,
personality, campaign, etc.
(Sell, attack, defend)
Arguments:
STEP 2
Polish the phrasing of each argument for maximum persuasive impact with
your target audience.
Note: Examine language particularly for conciseness, clarity, authority,
vividness -- therefore, for "soundbite potential."
Rephrased Arguments:
STEP 3
Marshal logical evidence (examples, actions taken or committed to, data,
expert testimony, photographs, etc.) to support each argument requiring
such proof.
Be sure that evidence passes the following basic tests:
relevant, authoritative, recent, sufficient, potent
Marshal emotional proof to buttress arguments.
Revised February, 1992
Martel & Associates
8
WORKSHEET
CANDIDATE IMAGE GOALS
As a candidate, the image you project of yourself is integral to your credibility and therefore your persuasive
potential. Use the following inventory to pinpoint the major image impressions you need to communicate to
help you achieve your Net Effects Goals as well as those you consciously need to prevent.
Positive
1.
action orientation
30.
imagination
2.
analytical ability
31.
integrity
3.
approachability
32.
kindness
4.
assertiveness
33.
liking for people
5.
believability/credibility
34.
loyalty
6.
candor
35.
maturity
7.
charisma
36.
neatness
8.
community-orientation
37.
objectivity
9.
compassion/caring
38.
openness
10.
competence
39.
organized
11.
competitiveness
40.
other-directed
12.
composure/calmness
41.
patience
13.
confidence
42.
positive attitude
14.
conviction
43.
reassuring
15.
cooperativeness
44.
relaxation
16.
courage
45.
respect for others
17.
decisiveness
46.
righteous indignation
18.
dependability
47.
security
19.
detail-orientation
48.
self-reliance
20.
directness
49.
sensitivity
21.
discipline
50.
sincerity
22.
energy
51.
standards/values
23.
enthusiasm
expectations
24.
fairness
52.
strength
25.
flexibility
53.
tactfulness
26.
friendliness
54.
tenacity
27.
graciousness
55.
toughness
28.
hard working nature
56.
trusting nature
29.
humorous nature
57.
warmth
Preventive
1.
anger
8.
hostility
2.
arrogance/aloofness
9.
impatience
3.
condescending/patronizing
10.
pedantic
4.
defensiveness
11.
preachiness
5.
detachment
12.
selfish/self-centered
6.
disdainfulness
13.
stress/tension/anxiety
7.
glib
14.
strident/shrill
Note:
Feel free to add trait(s) not identified above.
Revised February, 1992
Martel & Associates
9
Major Tactics for Political and
Public Policy Debates
Forewarning or Preempting
The Shotgun Blast
The Laundry List
Direct Questions and Challenges
Turning the Tables
Flat Denial
Quotable and Attack Lines
Highlighting Evasiveness
Closing with a Surprise
Tossing Bouquets
The Apology or Confessional
"I Pass"
Reference Tactics (how to refer to your opponent)
Wit/Humor
Appeals to Special Audiences
Appeals to Commonly Held Values
Rhetorical Questions
"Man With the Facts"
Visual Aids/Props
Illustrations, Anecdotes, Metaphors, Analogies
"Banana Peels"
Based on:
Political Campaign Debates: Images, Strategies, and Tactics by M. Martel, Longman,
1983.
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MANAGING HOSTILITY
Hostile questions are often hidden opportunities; they can stimulate the speaker's
competitive juices and, as a result, bring out his or her best.
Composure -- or loss of it -- can speak more loudly than content.
Do your best to depersonalize the situation by defending your position on the issue --
not your ego.
The questioner's hostility may be more related to his or her personality than to
feelings about you or your organization.
Don't confuse a tough question with a hostile question.
The hostile questioner is not necessarily a member of your target audience.
The hostile questioner can generate audience sympathy toward the speaker.
Monitor your body language, assuming a friendly attitude toward the questioner until
you have compelling evidence to act differently.
Don't overengage the hostile audience member. Learn how to break both verbal
contact and eye contact.
Source:
Mastering the Art of Q & A: A Survival Guide to Tough, Trick and Hostile
Questions, Myles Martel, Ph.D. (Dow Jones-Irwin), 1989
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MARTEL & ASSOCIATES
"Banana Peels" and Political Debates
The basic premise of the "Banana Peels" approach is that your aptitude in answering questions
will be strengthened by your ability to label the type of question being asked and to employ the
appropriate tactical options associated with it. Regardless of the type of "Banana Peel," you
should be monitoring the opportunity the question provides for you to reinforce one or more key
messages.
Type
Example
Major Options
1. Hostile
"How do you expect to be
1. Maintain composure.
credible with your rotten
2. Take exception to language without
environmental record?"
repeating hostile/loaded terms verbatim.
3. Refute assumptions.
4. Ignore negative accusations, and go on the
offense with your "sell" or attack points.
2. Speculative
"Do you expect the
1. Answer if response is known and relatively
economy to get worse before
risk free.
it gets better?"
2. If not risk free, label question as
speculative without appearing defensive or
patronizing.
3. Seek an opening for your key message.
3. Hypo-
"If the Federal Government
1. Answer directly.
thetical
had invested more in
2. Point out hypothetical nature of question.
research, could this
3. Insert your key message
problem have been
prevented?"
4. Picayune/
"How did you vote on
1. If answer is known, answer directly.
Overspecific
Senate Bills X, Y, & Z?"
2. If you don't know, say so. (Sometimes
you may need to explain in a non-
defensive, non-apologetic manner why you
don't know and offer to provide the answer
later.)
3. Seek an opening to switch to a key
message.
5! Leading
"Isn't it true that you voted
1. Agree or disagree.
(Also a "yes,
in favor of this bill mainly
2. Note, without being argumentative, that the
no" question)
to reinforce your weakening
question is leading.
support amongst farmers?"
3. Challenge/Question the assumption(s).
4. Ignore, and bridge to a "sell" theme.
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Type
Example
Major Options
6. Loaded
"Your opponent and the
1. If you agree or disagree with any of these
media have referred to you
assumptions, let it be known--but without
as a 'junket junkie' who
repeating the damning premise--and then
jumps at the opportunity to
respond.
join a special delegation:
Note: Major loaded terms and assumptions
How do you react to this?"
are underlined.
2. Ignore claim(s) and "sell" your positive
message instead.
7. Multi-
"What is the most serious
1. If each facet can be remembered, and
faceted
aspect of the healthcare
answering all won't cause harm (assuming
problem today? What are its
there is ample time), then answer fully.
causes? Can the Federal
2. If harm can be caused by answering a
Government have an impact
remembered facet, it may be advisable to
in alleviating the problem?
"forget" it and answer the others.
How? By when? What
3. Don't hesitate to ask for a facet to be
would you do to make a
repeated if you are reasonably certain you
difference?"
forgot a "safe" one and won't be offered
an "unsafe" one.
4. If the questions cannot be realistically
answered within the time allotted, politely
say so.
5. Sometimes it may be advisable not to
respond in the order in which the facets
were asked, e.g., if the last facet is the
most crucial, it may require your initial
attention.
6. Try to summarize overall response with a
key message theme.
8. Vague,
"What would you do to
1. Define the question the way you wish--
Unfocused
energize the economy?"
consistent with your persuasive goals.
2. Ask the questioner to clarify his/her focus.
9. "Yes-No"
"Did limited Congressional
1. If "yes" or "no" is safe by itself, answer
oversight play a role in this
accordingly.
problem developing?"
2. Challenge any refutable assumption
(implicit or explicit).
3. If a simple "yes" or "no" response is risky,
point out how the forced alternatives can
interfere with a presentation of the "full
truth." Then answer the question.
4. Present your position.
Also leading
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Type
Example
Major Options
10. "Either
"Is this problem due more to
1. If assumption within first part of the
-Or"
limited oversight or to
question is incorrect, refute it.
limited funding?"
2. How accurate is the assumption within the
second part of the question? If not, refute
it.
3. How correct are the causal connections?
4. Consider pointing out the either-or nature
of the question.
5. How complete an explanation is it? Are
other factors-possibly more significant
ones-involved? If so, explain, possibly
labeling the question as "either-or."
*
Some of these examples represent a combination of "banana peels." Frequently, the
combinations appear as leading or yes-no questions with some other type of "banana peel"
present.
Sources:
Mastering the Art of Q&A: A Survival Guide for Tough, Trick & Hostile Questions (Dow Jones-
Irwin) and The Persuasive Edge: The Executive's Guide to Speaking and Presenting (Fawcett
Columbine).
Copyright 1983: revised 1990; February 1992.
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DEBATE HEADLINES
CULTIVATING CREDIBILITY AND "QUOTABILITY"
by
Myles Martel
In most debates, media interviews and Q & A situations you should begin your answer
with a headline, a single sentence to provide the impression that you are responding to the
question and to convey a sense of direction as you pursue the fuller response.
Eight principal options surround the use of the headline:
1.
The Flat Answer (of Agreement or Disagreement)
"Yes," "No," "Perhaps," "Right now," "Absolutely," "Surely," "Definitely"
"I can't accept that," "I disagree," etc.
2.
The Response (Via Agreement or Disagreement) to a Premise Contained within
the Question
"You're right, I did vote in favor of the legislation you mentioned.
However..."
3.
The Framing Statement
"There are three major steps I would take if the problem you describe were to
become more serious."
4.
The Use of Proof
"According to the FBI, drug-related crimes have increased % within the past
decade."
5.
The Backgrounding Preamble
"To answer your question, I must supply you with a little background
information."
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6.
The Argument(s)
"Because the CIA apparatus failed to predict and therefore failed to alert us to
the likelihood of the attempted coup."
7.
The Editorial (Regarding the Quality or Difficulty of the Question) "You've
asked a very complex (interesting, provocative, intriguing) question."
8.
The Show of Support, Empathy, or Compassion
"I have great empathy for the indescribable difficulty -- the untold pain -
experienced by the people who survived that earthquake."
Advice:
1.
The better the headline, the more likely that your target audience will pay
attention to your answer, plus sense your ability and willingness to provide it.
This enhances your credibility and your "quotability."
2.
Whenever possible, try to use the headline to reinforce a key message as well
as a major image trait.
3.
A caveat is in order: Stating your position too strongly in the headline can
cause a disagreeing target audience member to become more defensive and
thereby more prone to refute your position internally or aloud.
Copyright January, 1988; Revised February, 1992.
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Martel & Associates Debate Preparation Plan
Planning for a debate is usually an enormously complex exercise where one
overlooked detail can make a difference between success and failure. This Plan helps
bring discipline to the preparation process.
I.
Basic Issues
Number of Debates
Dates
Location
Sponsor
Media Coverage
Political Implications of Each Debate Chosen, Including Target Audience
Negotiating Potential
II.
Format Features
Opening Addresses Length
Basis for Sequence
Rejoinder Length
Questions
No.
Length
Cand. A Response Length
Cand. B Response Length
Follow up Questions Definite
Optional
Location in Format
Response Length
Cand. A Rebuttal Length
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Candidates Question Each Other Directly
Location in Debate
Length of Questions
Number of Questions
Length of Response
I
Rebuttal
Length
Counterrebuttal
Direct Question Groundrules (re:topics, tone, phrasing, etc).
Moderator:
Who?
How Selected?
Role as
Questioner?
Panelists
Number
Who
How Selected (Candidate Input Opportunity)
Closing Addresses
Length
Basis for Sequence
Means by which extra time or less time than anticipated will be managed.
Add Questions
Add to Response Length
Subtract
Questions
Shorter Response Length
Add to or Shorten Closing Remarks
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III.
Negotiating Details
Notes taken to lectern?
Notes taken at lectern?
Props and visual aids?
Coin Toss
Meaning
Date and Time
What degree of authority does the negotiator have?
Will agreements be placed in writing?
Should a "silence" agreement be placed on what transpires during the
negotiating sessions?
Should the sessions be held in stages?
How many?
When?
IV.
Technical Issues
A.
Stage Setting
Will candidates sit or stand?
Where will each sit or stand?
Will the moderator and panelists separate the debaters?
A
Panel
B
Will they be facing the candidates?
A
B
Panel
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Will a "V" formation be used?
Moderator
C
C
Panel
What are the exact measurements of the set?
What are the exact measurements of the lectern?
Have lecterns been "sandbagged"?
Have pens and notepad been provided on lectern?
Have sheets been removed to prevent tearing?
Water glasses available? (no stemware)
How will debate be timed?
Will there be timecards? Colored lights? Location?
Visibility to candidate? What signals will be conveyed? How?
How will overtime be signalled? Visually? Orally? Both?
Visually then orally?
Will each candidate have a timer?
Will the timers be in line with the candidate's camera?
Will there be a running clock on the lectern?
Will one be mounted on or near the camera?
B.
Cameras
How many?
Where will they be placed?
Will the candidates each have dedicated cameras?
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C.
Lighting
What is the specific lighting configuration?
How adjustable is the lighting for factors of heat and glare?
D.
Audience
Will there be a live audience?
How many?
Who?
Number of tickets per candidate?
Will the audience be allowed to react overtly to the debate?
Will audience members be invited to pose questions?
Will television cameras focus on audience reactions during the debate?
What type of security will be present? Legalities of ejecting disrupting
parties?
E.
Sound
Will the candidates use lectern or lavalier microphones? Backup?
Will candidates be able to hear panelists and audience questions?
Will candidate be able to hear the opponent(s)?
Will a sound and lighting check be arranged for each candidate?
When?
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V.
The Debate
A.
Pre-Debate Media Strategy
How to respond to questions re:
Preparation methods
Strategy
Candidate's mood
Expectations re: performance
Etc.
B.
Management
Special Debate Office
Secretary
Typewriter
Xerox machine
Phone lines
Message center
Refreshments
C.
Candidate
Schedule leading up to debate
Suite near debate
Food and liquid intake as debate approaches
Exercise
Warm up questions
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Persons to be with candidate shortly before debate begins
Advance team escort to debate
Persons to take stage following debate
Advance team to escort from debate
Makeup Opportunity
Station's Artist
Own
Perspiration control techniques
D.
The Opening Moments
How will the debate be introduced?
How will candidates be introduced?
Handshake
Smile and nod upon introduction
Eye contact with panelists, opponent, live audience, television cameras?
E.
Post-Debate Considerations
Press availability
Timing
Location and Specific Details of Setting
Length
Planned Responses to Anticipated Questions
Rally
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Media's Approach to Debate:
Interview prominent figures
"Person - on - the - Street"
Call - in Polls re: Who won or lost
"Control" tactics regarding media approaches
Should the campaign make an audio and videotape of
the debate?
Will the debate be replayed? When? What channel(s)?
Legal considerations?
Should a full transcript be made?
F.
Other Details
No motorized camera rule
No roving reporters during debate
No applause rule
Unruly conduct will result in expulsion rule
No admittance once debate has begun rule
Pre-debate photo opportunity with opponent
Pre-debate actuality -- radio or TV -- to promote debate
Specific nature of pre-debate publicity
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