[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[H.R. 420 Introduced in House (IH)]
110th CONGRESS
1st Session
H. R. 420
To amend the Federal Election Campaign Act of 1971 to clarify when
organizations described in section 527 of the Internal Revenue Code of
1986 must register as political committees, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
January 11, 2007
Mr. Meehan (for himself, Mr. Shays, and Mr. Castle) introduced the
following bill; which was referred to the Committee on House
Administration
_______________________________________________________________________
A BILL
To amend the Federal Election Campaign Act of 1971 to clarify when
organizations described in section 527 of the Internal Revenue Code of
1986 must register as political committees, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``527 Reform Act of 2007''.
SEC. 2. TREATMENT OF SECTION 527 ORGANIZATIONS.
(a) Definition of Political Committee.--Section 301(4) of the
Federal Election Campaign Act of 1971 (2 U.S.C. 431(4)) is amended--
(1) by striking the period at the end of subparagraph (C)
and inserting ``; or''; and
(2) by adding at the end the following:
``(D) any applicable 527 organization.''.
(b) Definition of Applicable 527 Organization.--Section 301 of such
Act (2 U.S.C. 431) is amended by adding at the end the following new
paragraph:
``(27) Applicable 527 Organization.--
``(A) In general.--For purposes of paragraph (4)(D), the
term `applicable 527 organization' means a committee, club,
association, or group of persons that--
``(i) has given notice to the Secretary of the
Treasury under section 527(i) of the Internal Revenue
Code of 1986 that it is to be treated as an
organization described in section 527 of such Code; and
``(ii) is not described in subparagraph (B).
``(B) Excepted organizations.--A committee, club,
association, or other group of persons described in this
subparagraph is--
``(i) an organization described in section
527(i)(5) of the Internal Revenue Code of 1986;
``(ii) an organization which is a committee, club,
association or other group of persons that is
organized, operated, and makes disbursements
exclusively for paying expenses described in the last
sentence of section 527(e)(2) of the Internal Revenue
Code of 1986 or expenses of a newsletter fund described
in section 527(g) of such Code;
``(iii) an organization which is a committee, club,
association, or other group that consists solely of
candidates for State or local office, individuals
holding State or local office, or any combination of
either, but only if the organization refers only to one
or more non-Federal candidates or applicable State or
local issues in all of its voter drive activities and
does not refer to a Federal candidate or a political
party in any of its voter drive activities; or
``(iv) an organization described in subparagraph
(C).
``(C) Applicable organization.--For purposes of
subparagraph (B)(iv), an organization described in this
subparagraph is a committee, club, association, or other group
of persons whose election or nomination activities relate
exclusively to--
``(i) elections where no candidate for Federal
office appears on the ballot; or
``(ii) one or more of the following purposes:
``(I) Influencing the selection,
nomination, election, or appointment of one or
more candidates to non-Federal offices.
``(II) Influencing one or more applicable
State or local issues.
``(III) Influencing the selection,
appointment, nomination, or confirmation of one
or more individuals to non-elected offices.
``(D) Exclusivity test.--A committee, club, association, or
other group of persons shall not be treated as meeting the
exclusivity requirement of subparagraph (C) if it makes
disbursements aggregating more than $1,000 for any of the
following:
``(i) A public communication that promotes,
supports, attacks, or opposes a clearly identified
candidate for Federal office during the 1-year period
ending on the date of the general election for the
office sought by the clearly identified candidate (or,
if a runoff election is held with respect to such
general election, on the date of the runoff election).
``(ii) Any voter drive activity during a calendar
year, except that no disbursements for any voter drive
activity shall be taken into account under this
subparagraph if the committee, club, association, or
other group of persons during such calendar year--
``(I) makes disbursements for voter drive
activities with respect to elections in only 1
State and complies with all applicable election
laws of that State, including laws related to
registration and reporting requirements and
contribution limitations;
``(II) refers to one or more non-Federal
candidates or applicable State or local issues
in all of its voter drive activities and does
not refer to any Federal candidate or any
political party in any of its voter drive
activities;
``(III) does not have a candidate for
Federal office, an individual who holds any
Federal office, a national political party, or
an agent of any of the foregoing, control or
materially participate in the direction of the
organization, solicit contributions to the
organization (other than funds which are
described under clauses (i) and (ii) of section
323(e)(1)(B)), or direct disbursements, in
whole or in part, by the organization; and
``(IV) makes no contributions to Federal
candidates.
``(E) Certain references to federal candidates not taken
into account.--For purposes of subparagraphs (B)(iii) and
(D)(ii)(II), a voter drive activity shall not be treated as
referring to a clearly identified Federal candidate if the only
reference to the candidate in the activity is--
``(i) a reference in connection with an election
for a non-Federal office in which such Federal
candidate is also a candidate for such non-Federal
office; or
``(ii) a reference to the fact that the candidate
has endorsed a non-Federal candidate or has taken a
position on an applicable State or local issue,
including a reference that constitutes the endorsement
or position itself.
``(F) Certain references to political parties not taken
into account.--For purposes of subparagraphs (B)(iii) and
(D)(ii)(II), a voter drive activity shall not be treated as
referring to a political party if the only reference to the
party in the activity is--
``(i) a reference for the purpose of identifying a
non-Federal candidate;
``(ii) a reference for the purpose of identifying
the entity making the public communication or carrying
out the voter drive activity; or
``(iii) a reference in a manner or context that
does not reflect support for or opposition to a Federal
candidate or candidates and does reflect support for or
opposition to a State or local candidate or candidates
or an applicable State or local issue.
``(G) Applicable state or local issue.--For purposes of
this paragraph, the term `applicable State or local issue'
means any State or local ballot initiative, State or local
referendum, State or local constitutional amendment, State or
local bond issue, or other State or local ballot issue.''.
(c) Definition of Voter Drive Activity.--Section 301 of such Act (2
U.S.C. 431), as amended by subsection (b), is further amended by adding
at the end the following new paragraph:
``(28) Voter Drive Activity.--The term `voter drive activity' means
any of the following activities conducted in connection with an
election in which a candidate for Federal office appears on the ballot
(regardless of whether a candidate for State or local office also
appears on the ballot):
``(A) Voter registration activity.
``(B) Voter identification.
``(C) Get-out-the-vote activity.
``(D) Generic campaign activity.
``(E) Any public communication related to activities
described in subparagraphs (A) through (D).
Such term shall not include any activity described in subparagraph (A)
or (B) of section 316(b)(2).''.
SEC. 3. RULES FOR ALLOCATION OF EXPENSES BETWEEN FEDERAL AND NON-
FEDERAL ACTIVITIES.
(a) In General.--Title III of the Federal Election Campaign Act of
1971 (2 U.S.C. 431 et seq.) is amended by adding at the end the
following:
``SEC. 325. ALLOCATION AND FUNDING RULES FOR CERTAIN EXPENSES RELATING
TO FEDERAL AND NON-FEDERAL ACTIVITIES.
``(a) In General.--In the case of any disbursements by any
political committee that is a separate segregated fund or nonconnected
committee for which allocation rules are provided under subsection
(b)--
``(1) the disbursements shall be allocated between Federal
and non-Federal accounts in accordance with this section and
regulations prescribed by the Commission; and
``(2) in the case of disbursements allocated to non-Federal
accounts, may be paid only from a qualified non-Federal
account.
``(b) Costs To Be Allocated and Allocation Rules.--
``(1) In general.--Disbursements by any separate segregated
fund or nonconnected committee, other than an organization
described in section 323(b)(1), for any of the following
categories of activity shall be allocated as follows:
``(A) 100 percent of the expenses for public
communications or voter drive activities that refer to
one or more clearly identified Federal candidates, but
do not refer to any clearly identified non-Federal
candidates, shall be paid with funds from a Federal
account, without regard to whether the communication
refers to a political party.
``(B) At least 50 percent, or a greater percentage
if the Commission so determines by regulation, of the
expenses for public communications and voter drive
activities that refer to one or more clearly identified
candidates for Federal office and one or more clearly
identified non-Federal candidates shall be paid with
funds from a Federal account, without regard to whether
the communication refers to a political party.
``(C) At least 50 percent, or a greater percentage
if the Commission so determines by regulation, of the
expenses for public communications or voter drive
activities that refer to a political party, but do not
refer to any clearly identified Federal or non-Federal
candidate, shall be paid with funds from a Federal
account, except that this paragraph shall not apply to
communications or activities that relate exclusively to
elections where no candidate for Federal office appears
on the ballot.
``(D) At least 50 percent, or a greater percentage
if the Commission so determines by regulation, of the
expenses for public communications or voter drive
activities that refer to a political party and refer to
one or more clearly identified non-Federal candidates,
but do not refer to any clearly identified Federal
candidates, shall be paid with funds from a Federal
account, except that this paragraph shall not apply to
communications or activities that relate exclusively to
elections where no candidate for Federal office appears
on the ballot.
``(E) Unless otherwise determined by the Commission
in its regulations, at least 50 percent of any
administrative expenses, including rent, utilities,
office supplies, and salaries not attributable to a
clearly identified candidate, shall be paid with funds
from a Federal account, except that for a separate
segregated fund such expenses may be paid instead by
its connected organization.
``(F) At least 50 percent, or a greater percentage
if the Commission so determines by regulation, of the
direct costs of a fundraising program or event,
including disbursements for solicitation of funds and
for planning and administration of actual fundraising
events, where Federal and non-Federal funds are
collected through such program or event shall be paid
with funds from a Federal account, except that for a
separate segregated fund such costs may be paid instead
by its connected organization. This paragraph shall not
apply to any fundraising solicitations or any other
activity that constitutes a public communication.
``(2) Certain references to federal candidates not taken
into account.--For purposes of paragraph (1), a public
communication or voter drive activity shall not be treated as
referring to a clearly identified Federal candidate if the only
reference to the candidate in the communication or activity
is--
``(A) a reference in connection with an election
for a non-Federal office in which such Federal
candidate is also a candidate for such non-Federal
office; or
``(B) a reference to the fact that the candidate
has endorsed a non-Federal candidate or has taken a
position on an applicable State or local issue (as
defined in section 301(27)(G)), including a reference
that constitutes the endorsement or position itself.
``(3) Certain references to political parties not taken
into account.--For purposes of paragraph (1), a public
communication or voter drive activity shall not be treated as
referring to a political party if the only reference to the
party in the communication or activity is--
``(A) a reference for the purpose of identifying a
non-Federal candidate;
``(B) a reference for the purpose of identifying
the entity making the public communication or carrying
out the voter drive activity; or
``(C) a reference in a manner or context that does
not reflect support for or opposition to a Federal
candidate or candidates and does reflect support for or
opposition to a State or local candidate or candidates
or an applicable State or local issue.
``(c) Qualified Non-Federal Account.--
``(1) In general.--For purposes of this section, the term
`qualified non-Federal account' means an account which consists
solely of amounts--
``(A) that, subject to the limitations of
paragraphs (2) and (3), are raised by the separate
segregated fund or nonconnected committee only from
individuals, and
``(B) with respect to which all requirements of
Federal, State, or local law (including any law
relating to contribution limits) are met.
``(2) Limitation on individual donations.--
``(A) In general.--A separate segregated fund or
nonconnected committee may not accept more than $25,000
in funds for its qualified non-Federal account from any
one individual in any calendar year.
``(B) Affiliation.--For purposes of this paragraph,
all qualified non-Federal accounts of separate
segregated funds or nonconnected committees which are
directly or indirectly established, financed,
maintained, or controlled by the same person or persons
shall be treated as one account.
``(3) Fundraising limitation.--
``(A) In general.--No donation to a qualified non-
Federal account may be solicited, received, directed,
transferred, or spent by or in the name of any person
described in subsection (a) or (e) of section 323.
``(B) Funds not treated as subject to act.--Except
as provided in subsection (a)(2) and this subsection,
any funds raised for a qualified non-Federal account in
accordance with the requirements of this section shall
not be considered funds subject to the limitations,
prohibitions, and reporting requirements of this Act
for any purpose (including for purposes of subsection
(a) or (e) of section 323 or subsection (d)(1) of this
section).
``(d) Definitions.--
``(1) Federal account.--The term `Federal account' means an
account which consists solely of contributions subject to the
limitations, prohibitions, and reporting requirements of this
Act. Nothing in this section or in section 323(b)(2)(B)(iii)
shall be construed to infer that a limit other than the limit
under section 315(a)(1)(C) applies to contributions to the
account.
``(2) Nonconnected committee.--The term `nonconnected
committee' shall not include a political committee of a
political party.
``(3) Voter drive activity.--The term `voter drive
activity' has the meaning given such term in section
301(28).''.
(b) Reporting Requirements.--Section 304(e) of such Act (2 U.S.C.
434(e)) is amended--
(1) by redesignating paragraphs (3) and (4) as paragraphs
(4) and (5); and
(2) by inserting after paragraph (2) the following new
paragraph:
``(3) Receipts and disbursements from qualified non-federal
accounts.--In addition to any other reporting requirement
applicable under this Act, a political committee to which
section 325(a) applies shall report all receipts and
disbursements from a qualified non-Federal account (as defined
in section 325(c)).''.
SEC. 4. CONSTRUCTION.
No provision of this Act, or amendment made by this Act, shall be
construed--
(1) as approving, ratifying, or endorsing a regulation
promulgated by the Federal Election Commission;
(2) as establishing, modifying, or otherwise affecting the
definition of political organization for purposes of the
Internal Revenue Code of 1986; or
(3) as affecting the determination of whether a group
organized under section 501(c) of the Internal Revenue Code of
1986 is a political committee under section 301(4) of the
Federal Election Campaign Act of 1971.
SEC. 5. JUDICIAL REVIEW.
(a) Special Rules for Actions Brought on Constitutional Grounds.--
If any action is brought for declaratory or injunctive relief to
challenge the constitutionality of any provision of this Act or any
amendment made by this Act, the following rules shall apply:
(1) The action shall be filed in the United States District
Court for the District of Columbia and shall be heard by a 3-
judge court convened pursuant to section 2284 of title 28,
United States Code.
(2) A copy of the complaint shall be delivered promptly to
the Clerk of the House of Representatives and the Secretary of
the Senate.
(3) A final decision in the action shall be reviewable only
by appeal directly to the Supreme Court of the United States.
Such appeal shall be taken by the filing of a notice of appeal
within 10 days, and the filing of a jurisdictional statement
within 30 days, of the entry of the final decision.
(4) It shall be the duty of the United States District
Court for the District of Columbia and the Supreme Court of the
United States to advance on the docket and to expedite to the
greatest possible extent the disposition of the action and
appeal.
(b) Intervention by Members of Congress.--In any action in which
the constitutionality of any provision of this Act or any amendment
made by this Act is raised (including but not limited to an action
described in subsection (a)), any Member of the House of
Representatives (including a Delegate or Resident Commissioner to
Congress) or Senate shall have the right to intervene either in support
of or opposition to the position of a party to the case regarding the
constitutionality of the provision or amendment. To avoid duplication
of efforts and reduce the burdens placed on the parties to the action,
the court in any such action may make such orders as it considers
necessary, including orders to require intervenors taking similar
positions to file joint papers or to be represented by a single
attorney at oral argument.
(c) Challenge by Members of Congress.--Any Member of Congress may
bring an action, subject to the special rules described in subsection
(a), for declaratory or injunctive relief to challenge the
constitutionality of any provision of this Act or any amendment made by
this Act.
(d) Applicability.--
(1) Initial claims.--With respect to any action initially
filed on or before December 31, 2010, the provisions of
subsection (a) shall apply with respect to each action
described in such subsection.
(2) Subsequent actions.--With respect to any action
initially filed after December 31, 2010, the provisions of
subsection (a) shall not apply to any action described in such
subsection unless the person filing such action elects such
provisions to apply to the action.
SEC. 6. EFFECTIVE DATE.
The amendments made by this Act shall take effect on the date of
the enactment of this Act.
<all>