[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2830 Introduced in House (IH)]

  1st Session
                                H. R. 2830

  To amend the Federal Election Campaign Act of 1971 to provide for a 
  House of Representatives election limitation on contributions from 
    persons other than in-State individual residents, and for other 
                               purposes.


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                           December 22, 1995

 Mr. English of Pennsylvania (for himself and Mr. Horn) introduced the 
following bill; which was referred to the Committee on House Oversight, 
  and in addition to the Committees on Ways and Means, Commerce, and 
   Government Reform and Oversight, for a period to be subsequently 
   determined by the Speaker, in each case for consideration of such 
 provisions as fall within the jurisdiction of the committee concerned

_______________________________________________________________________

                                 A BILL


 
  To amend the Federal Election Campaign Act of 1971 to provide for a 
  House of Representatives election limitation on contributions from 
    persons other than in-State individual residents, 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 ``Campaign Finance Reform, Fairness, 
and Citizens Involvement Act''.

SEC. 2. HOUSE OF REPRESENTATIVES ELECTION LIMITATION ON CONTRIBUTIONS 
              FROM PERSONS OTHER THAN IN-STATE INDIVIDUAL RESIDENTS.

    Section 315 of the Federal Election Campaign Act of 1971 (2 U.S.C. 
441a), is amended by adding at the end the following new subsection:
    ``(i)(1) A candidate for the office of Representative in, or 
Delegate or Resident Commissioner to, the Congress may not, with 
respect to a reporting period for an election, accept contributions 
from persons other than in-State individual residents in excess of 50 
percent of the total of contributions accepted.
    ``(2) As used in this subsection, the term `in-State individual 
resident' means an individual who is a resident of the State in which 
the congressional district involved is located.''.

SEC. 3. ANTI-BUNDLING PROVISION.

    Section 315 of the Federal Election Campaign Act of 1971 (2 U.S.C. 
441a), as amended by section 2, is further amended by adding at the end 
the following new subsection:
    ``(j) No person may act as an intermediary or conduit for any 
contribution from another person in the form of a check or other 
negotiable instrument that is made payable to a candidate for Federal 
office or a campaign committee of a candidate for Federal office.''.

SEC. 4. INCOME TAX CREDIT FOR CONTRIBUTIONS TO FEDERAL CAMPAIGNS.

    (a) General Rule.--Subpart A of part IV of subchapter A of chapter 
1 of the Internal Revenue Code of 1986 (relating to nonrefundable 
personal credits) is amended by inserting after section 22 the 
following new section:

``SEC. 23. CONTRIBUTIONS TO FEDERAL CAMPAIGNS.

    ``(a) General Rule.--In the case of an individual, there shall be 
allowed as a credit against the tax imposed by this chapter for the 
taxable year an amount equal to all Federal campaign contributions paid 
or incurred by the individual during such taxable year.
    ``(b) Limitations.--
            ``(1) Amount of credit.--The credit allowed by subsection 
        (a) for a taxable year shall not exceed $100 ($200 in the case 
        of a joint return).
            ``(2) Verification.--The credit allowed by subsection (a) 
        shall be allowed, with respect to any Federal campaign 
        contribution, only if such contribution is verified in such 
        manner as the Secretary shall prescribe by regulation.
    ``(c) Definitions.--For purposes of this section--
            ``(1) Candidate.--The term `candidate' means an individual 
        who--
                    ``(A) publicly announces before the close of the 
                calendar year following the calendar year in which the 
                contribution or gift is paid or incurred that he is a 
                candidate for nomination or election to any Federal 
                elective public office, and
                    ``(B) meets the qualifications prescribed by law to 
                hold such office.
            ``(2) Federal campaign contribution.--The term `Federal 
        campaign contribution' means a contribution or gift of money, 
        or the fair market value of a contribution or gift of property, 
        to--
                    ``(A) an individual who is a candidate for 
                nomination or election to any Federal elective public 
                office in any primary, general, or special election, 
                for use by such individual to further the candidacy of 
                the individual for nomination or election to such 
                office,
                    ``(B) any committee, association, or organization 
                (whether or not incorporated) organized and operated 
                exclusively for the purposes of influencing, or 
                attempting to influence, the nomination or election of 
                one or more individuals who are candidates for 
                nomination or election to any Federal elective public 
                office, for use by such committee, association, or 
                organization to further the candidacy of such 
                individual or individuals for nomination or election to 
                such office, or
                    ``(C) the national committee of a national 
                political party, the State committee of a national 
                political party as designated by the national committee 
                of such party, or a local committee of a national 
                political party as designated by the State committee of 
                such party designated under this subparagraph, for use 
                by such committee to further the candidacy of such 
                individual or individuals for nomination or election to 
                such office.
    ``(d) Cross References.--

                                ``For transfer of appreciated property 
to a political organization, see section 84.
                                ``For certain indirect contributions to 
political parties, see section 276.''
    (b) Clerical Amendment.--The table of sections for subpart A of 
part IV of subchapter A of chapter 1 of such Code is amended by 
inserting after the item relating to section 22 the following new item:

                              ``Sec. 23. Contributions to Federal 
                                        campaigns.''
    (c) Effective Date.--The amendments made by this section shall 
apply to contributions paid or incurred after the date of the enactment 
of this Act, in taxable years ending after such date.

SEC. 5. IMPOSITION OF SECTION 501(h) LOBBYING RESTRICTIONS ON TAX-
              EXEMPT LABOR, AGRICULTURAL, AND HORTICULTURAL 
              ORGANIZATIONS.

    (a) In General.--Paragraph (5) of section 501(c) of the Internal 
Revenue Code of 1986 (relating to exemption from tax on corporations, 
certain trusts, etc.) is amended to read as follows:
            ``(5) Labor, agricultural, or horticultural organizations 
        with respect to which exemption from taxation under subsection 
        (a) is not required to be denied under subsection (h) and which 
        do not participate in, or intervene in (including the 
        publishing or distributing of statements), any political 
        campaign on behalf of (or in opposition to) any candidate for 
        public office.''
    (b) Conforming Amendments.--
            (1) Denial of tax exemption by reason of expenditures to 
        influence legislation.--Paragraph (3) of section 501(h) of such 
        Code is amended to read as follows:
            ``(3)  Organizations to which this subsection applies.--
        This subsection shall apply to--
                    ``(A) any labor, agricultural, or horticultural 
                organization, and
                    ``(B) any other organization which has elected (in 
                such manner and at such time as the Secretary may 
                prescribe) to have the provisions of this subsection 
                apply to such organization and which, for the taxable 
                year which includes the date the election is made, is 
                described in subsection (c)(3) and--
                            ``(i) is described in paragraph (4), and
                            ``(ii) is not a disqualified organization 
                        under paragraph (5).''
            (2) Prohibition on treatment as 501(c)(4) organization 
        after ceasing to qualify for 501(c)(5) exemption because of 
        substantial lobbying or political activities.--Subsection (a) 
        of section 504 of such Code is amended by inserting ``or 
        section 501(c)(5)'' after ``section 501(c)(3)'' each place it 
        appears.
            (3) Tax on excess expenditures to influence legislation.--
                    (A) Applicability to section 501(c)(5) 
                organizations.--Section 4911 of such Code is amended by 
                adding at the end the following new subsection:
    ``(g) Applicability to Section 501(c)(5) Organizations.--For 
purposes of this section--
            ``(1) In general.--Any organization which is a 501(c)(5) 
        organization for a taxable year shall be treated as if an 
        election under section 501(h) were in effect for such 
        organization for such taxable year.
            ``(2) Section 501(c)(5) organization.--The term `501(c)(5) 
        organization' has the meaning given such term by section 
        4955(f).''
                    (B) Exempt purpose expenditures.--Subparagraph (A) 
                of section 4911(e)(1) of such Code is amended by 
                striking the period and inserting the following: ``and 
                includes, in the case of a 501(c)(5) organization, 
                purposes described in section 501(c)(5) with respect to 
                such organization.''
                    (C) Affiliated organizations.--Paragraph (1) of 
                section 4911(f) of such Code is amended by inserting 
                ``or section 501(c)(5)'' after ``section 501(c)(3)'' 
                each place it appears.
            (4) Tax on political expenditures.--
                    (A) In general.--
                            (i) Initial taxes.--Paragraph (1) of 
                        section 4955(a) of such Code is amended by 
                        inserting ``or section 501(c)(5) organization'' 
                        after ``section 501(c)(3) organization''.
                            (ii) Political expenditure.--Paragraph (1) 
                        of section 4955(d) of such Code is amended by 
                        inserting ``or section 501(c)(5) organization'' 
                        after ``section 501(c)(3) organization''.
                    (B) Definition.--Subsection (f) of section 4955 of 
                such Code is amended by adding at the end the following 
                new paragraph:
            ``(5) Section 501(c)(5) organization.--The term `section 
        501(c)(5) organization' means any organization which (without 
        regard to any political expenditure) would be described in 
        section 501(c)(5) and exempt from taxation under section 
        501(a).''
            (5) Termination assessments in case of flagrant political 
        expenditures.--
                    (A) In general.--Subparagraph (A) of section 
                6852(a)(1) of such Code is amended by inserting ``or 
                section 501(c)(5) organization'' after ``section 
                501(c)(3) organization''.
                    (B) Definition.--Paragraph (1) of section 6852(b) 
                of such Code is amended by inserting ```section 
                501(c)(5) organization','' after ```section 501(c)(3) 
                organization',''.
            (6) Action to enjoin flagrant political expenditures.--
                    (A) In general.--Paragraph (1) of section 7409(a) 
                of such Code is amended in the first sentence--
                            (i) by inserting ``or section 501(c)(5) 
                        organization'' after ``section 501(c)(3) 
                        organization'', and
                            (ii) by inserting ``or section 501(c)(5), 
                        respectively'' after ``specified in section 
                        501(c)(3)''.
                    (B) Injunctive relief.--Paragraph (2) of section 
                7409(b) of such Code is amended by inserting ``or 
                section 501(c)(5) (as the case may be)'' after 
                ``section 501(c)(3)''.
                    (C) Definition.--Subsection (c) of section 7409 of 
                such Code is amended by inserting ``, `section 
                501(c)(5) organization','' after ```section 501(c)(3) 
                organization'''.
            (7) Declaratory judgments relating to 501(c)(5) status.--
        Subparagraph (A) of section 7428(a)(1) of such Code is amended 
        by inserting ``or section 501(c)(5)'' after ``section 
        501(c)(3)''.
    (c) Clerical Amendments.--
            (1) The heading of subsection (h) of section 501 of such 
        Code is amended to read as follows:
    ``(h) Expenditures by Public Charities and Labor, Agricultural, or 
Horticultural Organizations to Influence Legislation.--''
            (2) The heading of section 504 of such Code is amended to 
        read as follows:

``SEC. 504. STATUS AFTER ORGANIZATION CEASES TO QUALIFY FOR EXEMPTION 
              UNDER SECTION 501(c)(3) or 501(c)(5) BECAUSE OF 
              SUBSTANTIAL LOBBYING OR BECAUSE OF POLITICAL 
              ACTIVITIES.''

            (3) The table of sections for part I of subchapter F of 
        chapter 1 of such Code is amended by striking the item relating 
        to section 504 and inserting the following new item:

                              ``Sec. 504. Status after organization 
                                        ceases to qualify for exemption 
                                        under section 501(c)(3) or 
                                        501(c)(5) because of 
                                        substantial lobbying or because 
                                        of political activities.''
            (4) The heading of section 4955 of such Code is amended to 
        read as follows:

``SEC. 4955. TAXES ON POLITICAL EXPENDITURES OF SECTION 501(c)(3) AND 
              501(c)(5) ORGANIZATIONS.''

            (5) The table of sections for subchapter C of chapter 42 of 
        such Code is amended by striking the item relating to section 
        4955 and inserting the following new item:

                              ``Sec. 4955. Taxes on political 
                                        expenditures of section 
                                        501(c)(3) and 501(c)(5) 
                                        organizations.''
            (6) The heading of subchapter C of chapter 42 of such Code 
        is amended to read as follows:

    ``Subchapter C--Political Expenditures of Section 501(c)(3) and 
                       501(c)(5) Organizations''.

            (7) The table of subchapters for chapter 42 of such Code is 
        amended by striking the item relating to subchapter C and 
        inserting the following new item:

                              ``Subchapter C. Political expenditures of 
                                        section 501(c)(3) and 501(c)(5) 
                                        organizations.''
            (8) The heading of section 6852 of such Code is amended to 
        read as follows:

``SEC. 6852. TERMINATION ASSESSMENTS IN CASE OF FLAGRANT POLITICAL 
              EXPENDITURES OF SECTION 501(c)(3) OR 501(c)(5) 
              ORGANIZATIONS.''

            (9) The table of sections for part I of subchapter A of 
        chapter 70 of such Code is amended by striking the item 
        relating to section 6852 and inserting the following new item:

                              ``Sec. 6852. Termination assessments in 
                                        case of flagrant political 
                                        expenditures of section 
                                        501(c)(3) or 501(c)(5) 
                                        organizations.''
            (10) The heading of section 7409 of such Code is amended to 
        read as follows:

``SEC. 7409. ACTION TO ENJOIN FLAGRANT POLITICAL EXPENDITURES OF 
              SECTION 501(c)(3) OR 501(c)(5) ORGANIZATIONS.''

            (11) The table of sections for subchapter A of chapter 76 
        of such Code is amended by striking the item relating to 
        section 7409 and inserting the following new item:

                              ``Sec. 7409. Action to enjoin flagrant 
                                        political expenditures of 
                                        section 501(c)(3) or 501(c)(5) 
                                        organizations.''
    (d) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning in calendar years beginning after the 
date of the enactment of this Act.

SEC. 6. VOLUNTARY LIMITATIONS ON EXPENDITURES IN HOUSE OF 
              REPRESENTATIVES ELECTIONS.

    The Federal Election Campaign Act of 1971 (2 U.S.C. 431 et seq.) is 
amended by adding at the end the following new title:

     ``TITLE V--VOLUNTARY LIMITATIONS ON EXPENDITURES IN HOUSE OF 
                       REPRESENTATIVES ELECTIONS

``SEC. 501. LIMITATION ON EXPENDITURES BY ELIGIBLE HOUSE OF 
              REPRESENTATIVES CANDIDATE.

    ``An eligible House of Representatives candidate may not, with 
respect to an election, make expenditures totaling more than $500,000.

``SEC. 502. LIMITATION ON USE OF PERSONAL FUNDS BY ELIGIBLE HOUSE OF 
              REPRESENTATIVES CANDIDATE.

    ``An eligible House of Representatives candidate may not, with 
respect to an election, use more than $25,000 from the personal funds 
of the candidate.

``SEC. 503. LESSENING OF IMPACT OF USE OF LARGE AMOUNTS OF PERSONAL 
              FUNDS BY OPPONENTS OF ELIGIBLE HOUSE OF REPRESENTATIVES 
              CANDIDATES.

    ``If any opponent of an eligible House of Representatives candidate 
uses more than $50,000 from the personal funds of such opponent with 
respect to an election, the limitation under section 315(a)(1)(A) shall 
not apply to contributions to the eligible House of Representatives 
candidate by individuals who are residents of the State in which the 
congressional district involved is located.

``SEC. 504. INDEXING.

    ``The amounts specified in sections 501 and 502 shall be adjusted 
in the same manner as provided in section 315(c), except that the base 
period shall be calendar year 1995.

``SEC. 505. DEFINITIONS.

    ``As used in this title the term `eligible House of Representatives 
candidate' means a candidate for the office of Representative in, or 
Delegate or Resident Commissioner to, the Congress, who, as determined 
by the Commission, complies with sections 501 and 502.''.

SEC. 7. BAN ON SOFT MONEY.

    (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 new section:

  ``limitations and reporting requirements for amounts paid for mixed 
                          political activities

    ``Sec. 323. (a) Any payment by the national committee of a 
political party or a State committee of a political party, or by a 
corporation or labor organization, for a mixed political activity--
            ``(1) shall be subject to limitation and reporting under 
        this Act as if such payment were an expenditure; and
            ``(2) may be paid only from an account that is subject to 
        the requirements of this Act.
    ``(b) As used in this section, the term `mixed political activity' 
means, with respect to a payment by the national committee of a 
political party or a State committee of a political party, an activity, 
such as a voter registration program, a get-out-the-vote drive, or 
general political advertising, that is both (1) for the purpose of 
influencing an election for Federal office, and (2) for any purpose 
unrelated to influencing an election for Federal office.''.
    (b) Repeal of Building Fund Exception to the Definition of the Term 
``Contribution''.--Section 301(8)(B) of the Federal Election Campaign 
Act of 1971 (2 U.S.C. 431(8)(B)) is amended--
            (1) by striking out clause (viii); and
            (2) by redesignating clauses (ix) through (xiv) as clauses 
        (viii) through (xiii), respectively.

SEC. 8. BROADCAST RATES AND PREEMPTION.

    (a) Broadcast Rates.--Section 315(b) of the Communications Act of 
1934 (47 U.S.C. 315(b)) is amended--
            (1) by striking ``(b) The changes'' and inserting ``(b)(1) 
        The changes'';
            (2) by redesignating paragraphs (1) and (2) as 
        subparagraphs (A) and (B), respectively;
            (3) in paragraph (1)(A), as redesignated--
                    (A) by striking ``forty-five'' and inserting 
                ``30''; and
                    (B) by striking ``lowest unit charge of the station 
                for the same class and amount of time for the same 
                period'' and inserting ``lowest charge of the station 
                for the same amount of time for the same period on the 
                same date''; and
            (4) by adding at the end the following new paragraph:
    ``(2) In the case of an eligible House of Representatives candidate 
(as defined in section 505 of the Federal Election Campaign Act of 
1971), the charges for the use of a broadcasting station during the 30-
day period and 60-day period referred to in paragraph (1)(A) shall not 
exceed 50 percent of the lowest charge described in paragraph 
(1)(A).''.
    (b) Preemption; Access.--Section 315 of such Act (47 U.S.C. 315), 
as amended by subsection (a) of this section, is further amended--
            (1) by redesignating subsections (d) and (e) as 
        redesignated, as subsections (e) and (f), respectively; and
            (2) by inserting immediately after subsection (c) the 
        following subsection:
    ``(d)(1) Except as provided in paragraph (2), a licensee shall not 
preempt the use, during any period specified in subsection (b)(1)(A), 
of a broadcasting station by an eligible House of Representatives 
candidate who has purchased and paid for such use pursuant to 
subsection (b)(2).
    ``(2) If a program to be broadcast by a broadcasting station is 
preempted because of circumstances beyond the control of the 
broadcasting station, any candidate advertising spot scheduled to be 
broadcast during that program may also be preempted.''.
    (c) Revocation of License for Failure To Permit Access.--Section 
312(a)(7) of the Communications Act of 1934 (47 U.S.C. 312(a)(7)) is 
amended--
            (1) by striking ``or repeated'';
            (2) by inserting ``or cable system'' after ``broadcasting 
        station''; and
            (3) by striking ``his candidacy'' and inserting ``the 
        candidacy of such person, under the same terms, conditions, and 
        business practices as apply to its most favored advertiser''.
    (d) Effective Date.--The amendments made by this section shall 
apply to the general elections occurring after December 31, 1995 (and 
the election cycles relating thereto).

SEC. 9. REDUCED POSTAGE RATES.

    (a) In General.--Paragraph (2) of subsection (e) of section 3626 of 
title 39, United States Code, is amended--
            (1) in subparagraph (A)--
                    (A) by striking ``and the National'' and inserting 
                ``the National''; and
                    (B) by inserting before the semicolon the 
                following: ``, and, subject to paragraph (3), the 
                principal campaign committee of an eligible House of 
                Representatives candidate;'';
            (2) in subparagraph (B), by striking ``and'' after the 
        semicolon;
            (3) in subparagraph (C), by striking the period and 
        inserting a semicolon; and
            (4) by adding after subparagraph (C) the following new 
        subparagraphs:
            ``(D) the term `principal campaign committee' has the 
        meaning given such term in section 301 of the Federal Election 
        Campaign Act of 1971; and
            ``(E) the term `eligible House of Representatives 
        candidate' has the meaning given such term in section 505 of 
        the Federal Election Campaign Act of 1971.''.
    (b) Effective Date.--The amendments made by this section shall 
apply to the general elections occurring after December 31, 1996 (and 
the election cycles relating thereto).
                                 <all>
HR 2830 IH----2