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108th CONGRESS
2d Session
S. 2828
To amend the Federal Election Campaign Act of 1971 to define political
committee and 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 SENATE OF THE UNITED STATES
September 22, 2004
Mr. McCain (for himself, Mr. Feingold, Mr. Lieberman, and Mr. Schumer)
introduced the following bill; which was read twice and referred to the
Committee on Rules and Administration
_______________________________________________________________________
A BILL
To amend the Federal Election Campaign Act of 1971 to define political
committee and 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 2004''.
SEC. 2. TREATMENT OF SECTION 527 ORGANIZATIONS.
(a) Definition of Political Committee.--Section 301(4)(A) of the
Federal Election Campaign Act of 1971 (2 U.S.C. 431(4)(A)) is amended
to read as follows:
``(A) any committee, club, association, or other
group of persons that--
``(i) during one calendar year, receives
contributions aggregating in excess of $1,000
or makes expenditures aggregating in excess of
$1,000; and
``(ii) has as its major purpose the
nomination or election of one or more
candidates;''.
(b) Definition of Major Purpose for Section 527 Organizations.--
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 new section:
``SEC. 325. DEFINITIONS AND RULES FOR DETERMINING ORGANIZATIONS AND
DISBURSEMENTS INFLUENCING FEDERAL ELECTIONS.
``(a) Major Purpose of Section 527 Organizations.--For purposes of
section 301(4)(A)--
``(1) In general.--A committee, club, association, or group
of persons that--
``(A) is an organization described in section 527
of the Internal Revenue Code of 1986, and
``(B) is not described in paragraph (2),
has as its major purpose the nomination or election of one or
more candidates.
``(2) Excepted organizations.--Subject to paragraph (3), a
committee, club, association, or other group of persons
described in this paragraph is--
``(A) an organization described in section
527(i)(5) of the Internal Revenue Code of 1986, or
``(B) any other organization which is one of the
following:
``(i) A committee, club, association, or
other group of persons whose election or
nomination activities relate exclusively to
elections where no candidate for Federal office
appears on the ballot.
``(ii) A committee, club, association, or
other group of persons that is organized,
operated, and makes disbursements exclusively
for 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
State or local ballot initiatives,
State or local referenda, State or
local constitutional amendments, State
or local bond issues, or other State or
local ballot issues.
``(III) Influencing the selection,
appointment, nomination, or
confirmation of one or more individuals
to non-elected offices.
``(IV) 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.
``(3) Section 527 organizations making certain
disbursements.--A committee, club, association, or other group
of persons described in paragraph (2)(B) shall not be
considered to be described in such paragraph for purposes of
paragraph (1)(B) if it makes disbursements for a public
communication that promotes, supports, attacks, or opposes a
clearly identified candidate for Federal office during the
period beginning on the first day of the calendar year
preceding the calendar year in which the general election for
the office sought by the clearly identified candidate occurs
and ending on the date of the general election.''.
SEC. 3. CERTAIN EXPENSES BY MAJOR PURPOSE ORGANIZATIONS TREATED AS
EXPENDITURES.
(a) In General.--Section 301(9)(A)(i) of the Federal Election
Campaign Act of 1971 (2 U.S.C. 431(9)(A)(i)) is amended by inserting
``, including any amount described in section 325(b)'' after
``office''.
(b) Applicable Communications.--Section 325 of the Federal Election
Campaign Act of 1971 (as added by section 2(b)) is amended by adding at
the end the following new subsection:
``(b) Certain Expenditures for Major Purpose Organizations.--
``(1) In general.--Subject to paragraph (2), a purchase,
payment, distribution, loan, advance, deposit, or gift of money
or anything of value for--
``(A) a public communication that refers to a
clearly identified candidate for Federal office or to a
political party (regardless of whether a candidate for
State or local office is also mentioned or identified)
and that promotes, supports, attacks, or opposes a
candidate for that office or a political party
(regardless of whether the communication expressly
advocates a vote for or against a candidate), or
``(B) voter registration activity, voter
identification, get-out-the-vote activity, or generic
campaign activity 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),
shall be an expenditure under section 301(9)(A)(i) if made by,
or on behalf of, a political committee (as defined in section
301(4)) or a committee, club, association, or other group of
persons for which the nomination or election of one or more
candidates is its major purpose.
``(2) Exception.--Any funds used for purposes described in
paragraph (1) that, in accordance with allocation rules set
forth in section 325(c), are disbursed from a non-Federal
account shall not be treated as expenditures.''.
SEC. 4. RULES FOR ALLOCATION OF EXPENSES BETWEEN FEDERAL AND NON-
FEDERAL ACTIVITIES.
Section 325 of the Federal Election Campaign Act of 1971 (as added
by section 2(b) and amended by section 3) is amended by adding at the
end the following:
``(c) Allocation and Funding Rules for Expenses of Separate
Segregated Funds and Nonconnected Committees Relating to Federal and
Non-Federal Activities.--
``(1) In general.--In the case of any disbursements by any
separate segregated fund or nonconnected committee for which
allocation rules are provided under paragraph (2)--
``(A) the disbursements shall be allocated between
Federal and non-Federal accounts in accordance with
this subsection and regulations prescribed by the
Commission, and
``(B) in the case of disbursements allocated to
non-Federal accounts, may be paid only from a qualified
non-Federal account.
``(2) Costs to be allocated and allocation rules.--
Disbursements by any separate segregated fund or nonconnected
committee in connection with Federal and non-Federal elections
for any of the following categories of activity shall be
allocated as follows:
``(A) 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.
``(B) At least 50 percent 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.
``(C) At least 50 percent 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.
``(D) 100 percent of the expenses for public
communications or voter drive activities that refer to
a political party, and 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.
``(E) At least 50 percent 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 subparagraph shall not apply to
communications or activities that relate exclusively to
elections where no candidate for Federal office appears
on the ballot.
``(F) At least 50 percent 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 defined non-
Federal candidates, without regard to whether the
communication refers to a political party, shall be
paid with funds from a Federal account.
``(3) Qualified non-federal account.--For purposes of this
subsection--
``(A) In general.--The term `qualified non-Federal
account' means an account which consists solely of
amounts--
``(i) that, subject to the limitations of
subparagraphs (B) and (C), are raised by the
separate segregated fund or nonconnected
committee only from individuals, and
``(ii) with respect to which all other
requirements of Federal, State, or local law
are met.
``(B) Limitation on individual donations.--
``(i) 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.
``(ii) Affiliation.--For purposes of this
subparagraph, 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.
``(C) Fundraising limitation.--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.
``(4) Voter drive activity and federal account defined.--
For purposes of this subsection--
``(A) 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):
``(i) Voter registration activity.
``(ii) Voter identification.
``(iii) Get-out-the-vote activity.
``(iv) Generic campaign activity.
``(B) 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 subsection 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.''.
SEC. 5. 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, or
(2) as establishing, modifying, or otherwise affecting the
definition of political organization for purposes of the
Internal Revenue Code of 1986.
SEC. 6. EFFECTIVE DATE.
The amendments made by this Act shall take effect on January 1,
2005.
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Pages: 1 Other Popular 106th Congressional Bills Documents:
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