S.1822 AS REPORTED MAY BE "UNCONSTITUTIONAL" [ seems to me I said a long time ago

[David Farber <farber () central cis upenn edu>]

From: Vigdor Schreibman - FINS <fins () access digex net>


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FINS SPECIAL REPORT                                  September 20, 1994
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S.1822 AS REPORTED MAY BE "UNCONSTITUTIONAL"
Amendment Intended of Universal Service Provisions


Washington, DC, Sept 20, 1994--Senate Committee on Commerce, Science, and
Transportation, released their report dated Sept 14 on S.1822, together
with the text of the bill including provisions for a "Universal Service
Fund" [sec. 102 of S.1822, new sec. 201A(d)], as ordered reported at the
markup Aug 11.  However, at least a day previously, there apparently was
in the air "intended amendments" to the bill "that would eliminate
provisions establishing a Universal Service Fund."


  The reasons for this discrepancy add one more note of confusion to the
already difficult course of this bill.  The Congressional Budget Office
prepared a cost estimate for S.1822, the Communications Act of 1994, in
accordance with normal practice with regard to proposed legislation
mandated by the provisions of paragraph 11(a) of rule XXVI of the Standing
Rules of the Senate and section 403 of the Congressional Budget Act of
1974. However, as reported earlier in the Washington Times [Fins-SR2-31],
the Congressional Budget Office "apparently decided that the method of
collecting the Universal Service Fund required by S.1822 constitutes a
tax."  This is significant because the Constitution requires that revenue
bills originate in the House of Representatives and Congressional rules of
procedure require them to originate in and be reviewed by the tax writing
Committees. The Senate bill, as reported, therefore, may have been
unconstitutional.


  Upon consultation with the Committee, however, the CBO did not actually
issue their determination that the USF "constitutes a tax."  Instead,
according to a letter to Senator Hollings, Chairman of the Committee, from
the Congressional Budget Office, dated Sept 13, the latter stated in the
estimate actually issued that the same "reflects committee amendments to
the bill that would eliminate provisions establishing a Universal Service
Fund and requiring telecommunications carriers to pay into that fund."


  FINS confirmed earlier today in a phone interview with Congressional
Budget Office staff Melissa Sampson, who prepared the the CBO estimate,
that their report was based on a document provided by the Committee,
disclosing the "intended amendment" the bill.  Nevertheless, CBO did not
publicly report that the amendment was merely "intended." In addition, the
bill as reported Sept 14, included the USF despite the "intended
amendment" that would "eliminate provisions establishing a Universal
Service Fund."


  FINS confirmed with Sean Crowley, Commerce Committee Press Secretary,
that the Chairman does intend to propose an amendment when the matter
reaches the Senate floor.  However, the Committee will not release the
text of the intended amendment, according to Crowley, until it is actually
presented on the floor of the Senate.  This is now expected to occur
sometime next week.