[Congressional Record Volume 143, Number 105 (Wednesday, July 23, 1997)]
[Senate]
[Pages S7950-S7959]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REED (for himself, Mr. Bryan, Mr. Hollings, and Mr. 
        Johnson):
  S. 1057. A bill to amend the Federal Election Campaign Act of 1971 to 
require mandatory spending limits for Senate candidates and limits on 
independent expenditures, to ban soft money, and for other purposes; to 
the Committee on Rules and Administration.


               THE CAMPAIGN SPENDING CONTROL ACT OF 1997

  Mr. REED. Mr. President, I rise today to discuss legislation I have 
just introduced, the Campaign Spending Control Act of 1997. The 1996 
elections, unfortunately, will be remembered for two remarkable facts. 
First, Federal campaigns produced record spending; over $2.7 billion or 
almost $28 for every voter. Second, the election produced record-low 
voter participation: less than half of those eligible chose to vote. 
These two tragic facts are inextricably linked.
  Due to the vast sums of money spent on campaigns, most Americans 
believe

[[Page S7952]]

our current campaign system is tainted by special interest money. Under 
a flood of money and television ads, voters view their voice as 
meaningless, their concerns as unaddressed, and their votes as 
unimportant. In order to restore public confidence, campaign finance 
reform must accomplish three goals. It must significantly reduce 
campaign spending; level the playing field for those who challenge 
incumbents; and, finally, encourage greater public participation and 
debate.
  These goals cannot be successfully addressed without significantly 
changing the rules which govern campaigns. Campaign scandals have posed 
a threat to the health of our democracy throughout our Nation's 
history. In 1907, after enduring embarrassment over a campaign scandal, 
President Teddy Roosevelt championed legislation prohibiting 
corporations from financing Federal candidates. In 1974, responding to 
the scandals of the 1972 elections and the resignation of President 
Nixon, Congress overwhelmingly passed legislation limiting spending by 
candidates, parties, and wealthy individuals.
  In 1996, all the past campaign reforms imploded, with a flood of 
corporate and individual money overwhelming legal limits. Million-
dollar corporate contributions funded advertisements to impact 
Presidential and congressional campaigns. Well-funded individuals and 
organizations also got into the act. By spending a record $70 million 
on so-called issue advertising, labor unions, business organizations, 
and ideological groups circumvented limits on direct contributions to 
candidates. Thus, candidates, awash in a sea of outside money, were 
pushed to not only trounce their opponents in fundraising, but to match 
outside groups. The chase for dollars sapped candidates' time which 
could have been spent debating, attending forums, and otherwise 
engaging voters. Once solicited, most of these millions were spent on 
uninformative, 30-second advertisements, which only served to further 
alienate the electorate. Unchecked, this campaign system will spiral 
into exponential spending increases, further disenfranchisement, and 
less dialog. The system is already close to collapsing under its own 
weight; the time to act is now.
  The roots of this abysmal situation can be traced to a misguided 
Supreme Court decision. In Buckley versus Valeo, a 1976 case which 
challenged the 1974 campaign reform legislation, the Court held that, 
in order to avoid corruption, contributions to candidates and 
committees could be limited. However, the Court invalidated expenditure 
limits on candidates and independent entities as infringements on free 
speech rights. The Court surmised that unlimited spending would 
increase the number and depth of issues discussed. Twenty years of 
campaign spending has proven the Court's decision fatally flawed: fewer 
issues are discussed, less debate occurs, and voter participation has 
declined. The single most important step to reform elections and 
revitalize our democracy is to reverse the Buckley decision by limiting 
the amount of money that a candidate or his allies can spend.

  For this reason, Senators Bryan, Hollings, Johnson, and I are 
introducing legislation which directly challenges the Buckley decision 
and places mandatory limits on all campaign expenditures. These limits 
do not favor incumbents. Over the last three elections, these limits 
would have restricted 80 percent of incumbents, while only impacting 18 
percent of those who challenged incumbents. Additionally, this 
legislation would fully ban corporate contributions, as well as 
unlimited and unregulated contributions by wealthy individuals and 
organizations. Further, our bill would limit campaign expenditures by 
supposedly, neutral, independent groups, and restrict corporations, 
labor unions, and other organizations from influencing campaigns under 
the guise of issue advocacy. The end result of this legislation would 
be to eliminate over $500 million from the system, discourage 
violations, encourage challenges to incumbents, and further promote 
debate among both candidates and the electorate.
  What effect would these limits have on political debate? Contrary to 
the Supreme Court, I believe such limits would increase dialog. 
Candidates would be free from the burdens of unending fundraising and 
thus be available to participate in debates, forums, and interviews. 
With greater access to candidates and less reason to believe that 
candidates were captives of their contributors, voters might well be 
more prepared to invest the time needed to be informed on issues of 
concern and ask candidates to address them.
  Some will argue that this legislation impinges upon freedom of 
speech. The bill will marginally restrict the rights of a few to spend 
money--not speak--so that the majority of voters might restore their 
faith in the process. Thus, speech will be restricted no more than 
necessary to fulfill what I believe to be several compelling interests. 
Such a restriction conforms with constitutional jurisprudence and has 
been demonstrated necessary by history. The fact is all democratic 
debates are restricted by rules. My legislation would simply implement 
necessary rules into our campaign system. Finally, it is important to 
remember that the vast majority of Americans, 96 percent, have never 
made a political contribution at any level of government. Capping 
expenditures will truly impact very few individuals, and that 
restriction will be marginal, but necessary.
  Implementing spending caps is a grass-roots initiative. Elected 
officials from 33 States have urged that the Buckley decision be 
revisited and limits implemented. Legislative bodies in Ohio and 
Vermont have implemented sweeping reform by enacting mandatory caps on 
candidate expenditures. Other States, such as my own, have embraced 
public financing as a means of reform. Yet, today, Congress struggles 
to even consider the most modest of reforms, such as banning so called 
soft money: unlimited donations by corporations, labor unions, and 
wealthy individuals to political party committees. Unfortunately, 
because most of the current reform proposals accept the reasoning 
enunciated in the Buckley decision, they will only serve to redirect an 
unlimited flow of cash. While I enthusiastically support any 
substantive reform, if we are to address the underlying cancer which 
has disintegrated voter trust and participation, the problem of 
unlimited expenditures must be directly confronted. This is a step that 
one municipality and two States have embraced. Many more State 
officials as well as prominent constitutional law scholars have urged 
such a course. Expenditure limitations have been proposed by 
congressional reformers in the past, and it is time to rededicate 
ourselves to this goal.

  Mr. President, I have a list of the 33 State officials and 24 State 
attorneys general who have urged the reversal of Buckley. I ask 
unanimous consent that these documents be printed in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered. (See 
exhibit 1.)
  Mr. REED. Mr. President, our democracy is dependent upon 
participation, stimulated by a belief that the system works for 
everyone. Just as scandals led to reform in 1907 and 1974, Congress 
must now rise to the task once again to address a threat to our 
democratic process. Polls continue to demonstrate that a majority of 
Americans believe the political process is controlled by wealthy 
interests. The most dangerous aspect of the current situation is that 
polls also show that voters have no faith in the ability of their 
representatives to implement reform. If we do not address the influence 
of money in our electoral system, the health of our democracy will 
endure increasing risk. It is time to begin true, comprehensive reform. 
I would like to thank Senators Bryan, Hollings, and Johnson for joining 
me in this endeavor. Their leadership on this issue in the past has 
proven invaluable, and I am proud that they have chosen to join me in 
this important effort. It is my hope that the Senate will now move to 
address the problem of our campaign system at its root. Finally, Mr. 
President, I ask unanimous consent that the text of this bill be 
printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 1057

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

[[Page S7953]]

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Campaign 
     Spending Control Act of 1997''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Statement of purpose.
Sec. 3. Findings of fact.

                TITLE I--SENATE ELECTION SPENDING LIMITS

Sec. 101. Senate election spending limits.

           TITLE II--COORDINATED AND INDEPENDENT EXPENDITURES

Sec. 201. Adding definition of coordination to definition of 
              contribution.
Sec. 202. Treatment of certain coordinated contributions and 
              expenditures.
Sec. 203. Political party committees.
Sec. 204. Limit on independent expenditures.
Sec. 205. Clarification of definitions relating to independent 
              expenditures.
Sec. 206. Elimination of leadership PACs.

                         TITLE III--SOFT MONEY

Sec. 301. Soft money of political party committee.
Sec. 302. State party grassroots funds.
Sec. 303. Reporting requirements.
Sec. 304. Soft money of persons other than political parties.

                         TITLE IV--ENFORCEMENT

Sec. 401. Filing of reports using computers and facsimile machines.
Sec. 402. Audits.
Sec. 403. Authority to seek injunction.
Sec. 404. Increase in penalty for knowing and willful violations.
Sec. 405. Prohibition of contributions by individuals not qualified to 
              vote.
Sec. 406. Use of candidates' names.
Sec. 407. Expedited procedures.

           TITLE V--SEVERABILITY; REGULATIONS; EFFECTIVE DATE

Sec. 501. Severability.
Sec. 502. Regulations.
Sec. 503. Effective date.

     SEC. 2. STATEMENT OF PURPOSE.

       The purposes of this Act are to--
       (1) restore the public confidence in and the integrity of 
     our democratic system;
       (2) strengthen and promote full and free discussion and 
     debate during election campaigns;
       (3) relieve Federal officeholders from limitations on their 
     attention to the affairs of the Federal government that can 
     arise from excessive attention to fundraising;
       (4) relieve elective office-seekers and officeholders from 
     the limitations on purposeful political conduct and discourse 
     that can arise from excessive attention to fundraising;
       (5) reduce corruption and undue influence, or the 
     appearance thereof, in the financing of Federal election 
     campaigns; and
       (6) provide non-preferential terms of access to elected 
     Federal officeholders by all interested members of the public 
     in order to uphold the constitutionally guaranteed right to 
     petition the Government for redress of grievances.

     SEC. 3. FINDINGS OF FACT.

       Congress finds the following:
       (1) The current Federal campaign finance system, with its 
     perceived preferential access to lawmakers for interest 
     groups capable of contributing sizable sums of money to 
     lawmakers' campaigns, has caused a widespread loss of public 
     confidence in the fairness and responsiveness of elective 
     government and undermined the belief, necessary to a 
     functioning democracy, that the Government exists to serve 
     the needs of all people.
       (2) The United States Supreme Court, in Buckley v. Valeo, 
     424 U.S. 1 (1976), disapproved the use of mandatory spending 
     limits as a remedy for such effects, while approving the use 
     of campaign contribution limits.
       (3) Since that time, campaign expenditures have risen 
     steeply in Federal elections with spending by successful 
     candidates for the United States Senate between 1976 and 1996 
     rising from $609,100 to $3,775,000, an increase that is twice 
     the rate of inflation.
       (4) As campaign spending has escalated, voter turnout has 
     steadily declined and in 1996 voter turnout fell to its 
     lowest point since 1924, and stands now at the lowest level 
     of any democracy in the world.
       (5) Coupled with out-of-control campaign spending has come 
     the constant necessity of fundraising, arising, to a large 
     extent, from candidates adopting a defensive ``arms race'' 
     posture of constant readiness against the risk of massively 
     financed attacks against whatever the candidate may say or 
     do.
       (6) The current campaign finance system has had a 
     deleterious effect on those who hold public office as endless 
     fundraising pressures intrude upon the performance of 
     constitutionally required duties. Capable and dedicated 
     officials have left office in dismay over these distractions 
     and the negative public perceptions that the fundraising 
     process engenders and numerous qualified citizens have 
     declined to seek office because of the prospect of having to 
     raise the extraordinary amounts of money needed in today's 
     elections.
       (7) The requirement for candidates to fundraise, the 
     average 1996 expenditure level required a successful Senate 
     candidate to raise more than $12,099 a week for 6 years, 
     significantly impedes on the ability of Senators and other 
     officeholders to tend to their official duties, and limits 
     the ability of candidates to interact with the electorate 
     while also tending to professional responsibilities.
       (8) As talented incumbent and potential public servants are 
     deterred from seeking office in Congress because of such 
     fundraising pressures, the quality of representation suffers 
     and those who do serve are impeded in their effort to devote 
     full attention to matters of the Government by the campaign 
     financing system.
       (9) Contribution limits are inadequate to control all of 
     these trends and as long as campaign spending is effectively 
     unrestrained, supporters can find ways to protect their 
     favored candidates from being outspent. Since 1976 major 
     techniques have been found and exploited to get around and 
     evade contribution limits.
       (10) Techniques to evade contribution limits include 
     personal spending by wealthy candidates, independent 
     expenditures that assist or attack an identified candidate, 
     media campaigns by corporations, labor unions, and nonprofit 
     organizations to advocate the election or defeat of 
     candidates, and the use of national, State, or local 
     political parties as a conduit for money that assists or 
     attacks such candidates.
       (11) Wealthy candidates may, under the present Federal 
     campaign financing system, spend any amount they want out of 
     their own resources and while such spending may not be self-
     corrupting, it introduces the very defects the Supreme Court 
     wants to avoid. The effectively limitless character of such 
     resources obliges a wealthy candidate's opponent to reach for 
     larger amounts of outside support, causing the deleterious 
     effects previously described.
       (12) Experience shows that there is an identity of interest 
     between candidates and political parties because the parties 
     exist to support candidates, not the other way around. Party 
     expenditures in support of, or in opposition to, an 
     identifiable candidate are, therefore, effectively spending 
     on behalf of a candidate.
       (13) Political experience shows that so-called 
     ``independent'' support, whether by individuals, committees, 
     or other entities, can be and often is coordinated with a 
     candidate's campaign by means of tacit understandings without 
     losing its nominally independent character and, similarly, 
     contributions to a political party, ostensibly for ``party-
     building'' purposes, can be and often are routed, by 
     undeclared design, to the support of identified candidates.
       (14) The actual, case-by-case detection of coordination 
     between candidate, party, and independent contributor is, as 
     a practical matter, impossible in a fast-moving campaign 
     environment.
       (15) So-called ``issue advocacy'' communications, by or 
     through political parties or independent contributors, need 
     not, as a practical matter, advocate expressly for the 
     election or defeat of a named candidate in order to cross the 
     line into election campaign advocacy; any clear, objective 
     indication of purpose, such that voters may readily observe 
     where their electoral support is invited, can suffice as 
     evidence of intent to impact a Federal election campaign.
       (16) When State political parties or other entities 
     operating under State law receive funds, often called ``soft 
     money'', for use in Federal elections, they become de facto 
     agents of the national political party and the inclusion of 
     these funds under applicable Federal limitations is necessary 
     and proper for the effective regulation of Federal election 
     campaigns.
       (17) The exorbitant level of money in the political system 
     has served to distort our democracy by giving some 
     contributors, who constitute less than 3 percent of the 
     citizenry, the appearance of favored access to elected 
     officials, thus undermining the ability of ordinary citizens 
     to petition their Government. Concerns over the potential for 
     corruption and undue influence, and the appearances thereof, 
     has left citizens cynical, the reputation of elected 
     officials tarnished, and the moral authority of Government 
     weakened.
       (18) The 2 decades of experience since the Supreme Court's 
     Buckley v. Valeo ruling in 1976 have made it evident that 
     reasonable limits on election campaign expenditures are now 
     necessary and these limits must comprehensively address all 
     types of expenditures to prevent circumvention of such 
     limits.
       (19) The Supreme Court based its Buckley v. Valeo decision 
     on a concern that spending limits could narrow political 
     speech ``by restricting the number of issues discussed, the 
     depth of their exploration, and the size of the audience 
     reached''. The experience of the past 20 years has been 
     otherwise as experience shows that unlimited expenditures can 
     drown out or distort political discourse in a flood of 
     distractive repetition. Reasonable spending limits will 
     increase the opportunity for previously muted voices to be 
     heard and thereby increase the number, depth, and diversity 
     of ideas presented to the public.
       (20) Issue advocacy communications that do not promote or 
     oppose an identified candidate should remain unregulated, as 
     should the traditional freedom of the press to report and 
     editorialize about candidates and campaigns.
       (21) In establishing reasonable limits on campaign 
     spending, it is necessary that the limits reflect the 
     realities of modern campaigning in a large, diverse 
     population with sophisticated and expensive modes of 
     communication. The limits must allow citizens to benefit from 
     a full and free debate of issues and permit candidates to 
     garner the resources necessary to engage in that debate.

[[Page S7954]]

       (22) The expenditure limits established in this Act for 
     election to the United States Senate were determined after 
     careful review of historical spending patterns in Senate 
     campaigns as well as the particular spending level of the 3 
     most recent elections as evidenced by the following:
       (A) The limit formula allows candidates a level of spending 
     which guarantees an ability to disseminate their message by 
     accounting for the size of the population in each State as 
     well as historical spending trends including the demonstrated 
     trend of lower campaign spending per voter in larger States 
     as compared to voter spending in smaller States.
       (B) The candidate expenditure limits included in this 
     legislation would have restricted 80 percent of the incumbent 
     candidates in the last 3 elections, while only impeding 18 
     percent of the challengers.
       (C) It is clear from recent experience that expenditure 
     limits as set by the formula in this Act will be high enough 
     to allow an effective level of competition, encourage 
     candidate dialogue with constituents, and circumscribe the 
     most egregiously high spending levels, so as to be a bulwark 
     against future campaign finance excesses and the resulting 
     voter disenfranchisement.
                TITLE I--SENATE ELECTION SPENDING LIMITS

     SEC. 101. SENATE ELECTION SPENDING LIMITS.

       (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. 324. SPENDING LIMITS FOR SENATE ELECTION CAMPAIGNS

       ``(a) In General.--The amount of funds expended by a 
     candidate for election to the Senate and the candidate's 
     authorized committees with respect to an election may not 
     exceed the election expenditure limits of subsections (b), 
     (c), and (d).
       ``(b) Primary Election Expenditure Limit.--The aggregate 
     amount of expenditures for a primary election by a Senate 
     candidate and the candidate's authorized committees shall not 
     exceed 67 percent of the general election expenditure limit 
     under subsection (d).
       ``(c) Runoff Election Expenditure Limit.--The aggregate 
     amount of expenditures for a runoff election by a Senate 
     candidate and the candidate's authorized committees shall not 
     exceed 20 percent of the general election expenditure limit 
     under subsection (d).
       ``(d) General Election Expenditure Limit.--
       ``(1) In general.--The aggregate amount of expenditures for 
     a general election by a Senate candidate and the candidate's 
     authorized committees shall not exceed the greater of--
       ``(A) $1,182,500; or
       ``(B) $500,000; plus
       ``(i) 37.5 cents multiplied by the voting age population 
     not in excess of 4,000,000; and
       ``(ii) 31.25 cents multiplied by the voting age population 
     in excess of 4,000,000.
       ``(2) Exception.--In the case of a Senate candidate in a 
     State that has not more than 1 transmitter for a commercial 
     Very High Frequency (VHF) television station licensed to 
     operate in that State, paragraph (1)(B) shall be applied by 
     substituting--
       ``(A) `$1.00' for `37.5 cents' in clause (i); and
       ``(B) `87.5 cents' for `31.25 cents' in clause (ii).
       ``(3) Indexing.--The monetary amounts in paragraphs (1) and 
     (2) shall be increased as of the beginning of each calendar 
     year based on the increase in the price index determined 
     under section 315(c), except that the base period shall be 
     calendar year 1997.
       ``(e) Exempted Expenditures.--In determining the amount of 
     funds expended for purposes of this section, there shall be 
     excluded any amounts expended for--
       ``(1) Federal, State, or local taxes with respect to 
     earnings on contributions raised;
       ``(2) legal and accounting services provided solely in 
     connection with complying with the requirements of this Act;
       ``(3) legal services related to a recount of the results of 
     a Federal election or an election contest concerning a 
     Federal election; or
       ``(4) payments made to or on behalf of an employee of a 
     candidate's authorized committees for employee benefits--
       ``(A) including--
       ``(i) health care insurance;
       ``(ii) retirement plans; and
       ``(iii) unemployment insurance; but
       ``(B) not including salary, any form of compensation, or 
     amounts intended to reimburse the employee.''.
           TITLE II--COORDINATED AND INDEPENDENT EXPENDITURES

     SEC. 201. ADDING DEFINITION OF COORDINATION TO DEFINITION OF 
                   CONTRIBUTION.

       (a) Definition of Contribution.--Section 301(8) of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 431(8)) is 
     amended--
       (1) in subparagraph (A)--
       (A) in clause (i), by striking ``or'' at the end;
       (B) in clause (ii) by striking the period and inserting ``; 
     or''; and
       (C) by adding at the end the following:
       ``(iii) a payment made for a communication or anything of 
     value that is for the purpose of influencing an election for 
     Federal office and that is a payment made in coordination 
     with a candidate.''; and
       (2) by adding at the end the following:
       ``(C) Payment made in coordination with.--The term `payment 
     made in coordination with' means--
       ``(i) a payment made by any person in cooperation, 
     consultation, or concert with, at the request or suggestion 
     of, or pursuant to any general or particular understanding 
     with, a candidate, a candidate's authorized committees, an 
     agent acting on behalf of a candidate or a candidate's 
     authorized committee, or (for purposes of paragraphs (9) and 
     (10) of section 315(a)) another person;
       ``(ii) the financing by any person of the dissemination, 
     distribution, or republication, in whole or in part, of any 
     broadcast or any written, graphic, or other form of campaign 
     materials prepared by the candidate or the candidate's 
     authorized committees (not including a communication 
     described in paragraph (9)(B)(i) or a communication that 
     expressly advocates the candidate's defeat); or
       ``(iii) payments made based on information about the 
     candidate's plans, projects, or needs provided to the person 
     making the payment by the candidate, the candidate's 
     authorized committees, or an agent of a candidate or a 
     candidate's authorized committees.''.
       (b) Conforming Amendments.--
       (1) Section 315.--Section 315(a)(7)(B) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 441a(a)(7)(B)) is 
     amended to read as follows:
       ``(B) expenditures made in coordination with a candidate, 
     within the meaning of section 301(8)(C), shall be considered 
     to be contributions to the candidate and, in the case of 
     limitations on expenditures, shall be treated as an 
     expenditure for purposes of this section; and''.
       (2) Section 316.--Section 316(b)(2) of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 441b(b)(2)) is amended by 
     striking ``shall include'' and inserting ``shall have the 
     meaning given those terms in paragraphs (8) and (9) of 
     section 301 and shall also include''.

     SEC. 202. TREATMENT OF CERTAIN COORDINATED CONTRIBUTIONS AND 
                   EXPENDITURES.

       Section 315(a) of the Federal Election Campaign Act of 1971 
     (2 U.S.C. 441a(a)) is amended by adding at the end the 
     following:
       ``(9) For purposes of this section, contributions made by 
     more than 1 person in coordination with each other (within 
     the meaning of section 301(8)(C)) shall be considered to have 
     been made by a single person.
       ``(10) For purposes of this section, an independent 
     expenditure made by a person in coordination with (within the 
     meaning of section 301(8)(C)) another person shall be 
     considered to have been made by a single person.''.

     SEC. 203. POLITICAL PARTY COMMITTEES.

       (a) Limit on Coordinated and Independent Expenditures by 
     Political Party Committees.--Section 315(d) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 441a(d)) is amended--
       (1) in paragraph (1), by inserting ``and independent 
     expenditures'' after ``Federal office''; and
       (2) in paragraph (3)--
       (A) by inserting ``, including expenditures made'' after 
     ``make any expenditure''; and
       (B) by inserting ``and independent expenditures advocating 
     the election or defeat of a candidate,'' after ``such 
     party''.
       (b) Rules Applicable When Limits not in Effect.--For 
     purposes of the Federal Election Campaign Act of 1971 (2 
     U.S.C. 431 et seq.), during any period beginning after the 
     effective date of this Act in which the limitation under 
     section 315(d)(3) (as amended by subsection (a)) is not in 
     effect the following amendments shall be effective:
       (1) Independent versus coordinated expenditures by a 
     political party committee.--Section 315(d) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 441a(d)) is amended--
       (A) in paragraph (1)--
       (i) by striking ``(2) and (3) of this subsection'' and 
     inserting ``(2), (3), and (4) of this subsection''; and
       (ii) by inserting ``coordinated'' after ``make'';
       (B) in paragraph (3), by inserting ``coordinated'' after 
     ``make''; and
       (C) by adding at the end the following:
       ``(4) Prohibition against making both coordinated 
     expenditures and independent expenditures.--
       ``(A) In general.--A committee of a political party shall 
     not make both a coordinated expenditure in excess of $5,000 
     and an independent expenditure with respect to the same 
     candidate during an election cycle.
       ``(B) Certification.--Before making a coordinated 
     expenditure in excess of $5,000 in connection with a general 
     election campaign for Federal office, a committee of a 
     political party that is subject to this subsection shall file 
     with the Commission a certification, signed by the treasurer, 
     stating that the committee will not make independent 
     expenditures with respect to such candidate.
       ``(C) Transfers.--A party committee that certifies under 
     this paragraph that the committee will make coordinated 
     expenditures with respect to any candidate shall not, in the 
     same election cycle, make a transfer of funds to, or receive 
     a transfer of funds from, any other party committee unless 
     that committee has certified under this paragraph that it 
     will only make coordinated expenditures with respect to 
     candidates.
       ``(D) Definition of coordinated expenditure.--In this 
     paragraph, the term `coordinated expenditure' shall have the 
     meaning given the term `payments made in coordination with' 
     in section 301(8)(C).''.
       (2) Limit on contributions to political party committees.--
     Section 315(a) of Federal Election Campaign Act of 1971 (2 
     U.S.C. 441a(a)) is amended--

[[Page S7955]]

       (A) in paragraph (1)(B), by striking ``which, in the 
     aggregate, exceed $20,000'' and inserting ``that--
       ``(i) in the case of a political committee that certifies 
     under subsection (d)(4) that it will not make independent 
     expenditures in connection with the general election campaign 
     of any candidate, in the aggregate, exceed $20,000; or
       ``(ii) in the case of a political committee that does not 
     certify under subsection (d)(4) that it will not make 
     independent expenditures in connection with the general 
     election campaign of any candidate, in the aggregate, exceed 
     $5,000''; and
       (B) in paragraph (2)(B), by striking ``which, in the 
     aggregate, exceed $15,000'' and inserting ``that--
       ``(i) in the case of a political committee that certifies 
     under subsection (d)(4) that it will not make independent 
     expenditures in connection with the general election campaign 
     of any candidate, in the aggregate, exceed $15,000; or
       ``(ii) in the case of a political committee that does not 
     certify under subsection (d)(4) that it will not make 
     independent expenditures in connection with the general 
     election campaign of any candidate, in the aggregate, exceed 
     $5,000''.
       (c) Definition of Election Cycle.--Section 301 of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 431) is 
     amended by adding at the end the following:
       ``(20) Election cycle.--The term `election cycle' means--
       ``(A) in the case of a candidate or the authorized 
     committees of a candidate, the period beginning on the day 
     after the date of the most recent general election for the 
     specific office or seat that the candidate is seeking and 
     ending on the date of the next general election for that 
     office or seat; and
       ``(B) in the case of all other persons, the period 
     beginning on the first day following the date of the last 
     general election and ending on the date of the next general 
     election.''.

     SEC. 204. LIMIT ON INDEPENDENT EXPENDITURES.

       (a) In general.--Section 315 of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 441a) is amended by adding at 
     the end the following:
       ``(i) Limit on Independent Expenditures.--No person shall 
     make an amount of independent expenditures advocating the 
     election or defeat of a candidate during an election cycle in 
     an aggregate amount greater than the limit applicable to the 
     candidate under section 315(d)(3).''.
       (b) Rules Applicable When Rules in Subsection (a) Not in 
     Effect.--For purposes of the Federal Election Campaign Act of 
     1971, during any period beginning after the effective date of 
     this Act in which the limit on independent expenditures under 
     section 315(i) of the Federal Election Campaign Act of 1971, 
     as added by subsection (a), is not in effect section 324 of 
     such Act, as added by section 101(a), is amended by adding at 
     the end the following:
       ``(f) Increase in Expenditure Limit in Response to 
     Independent Expenditures.--
       ``(1) In general.--The applicable election expenditure 
     limit for a candidate shall be increased by the aggregate 
     amount of independent expenditures made in excess of the 
     limit applicable to the candidate under section 315(d)(3)--
       ``(A) on behalf of an opponent of the candidate; or
       ``(B) in opposition to the candidate.
       ``(2) Notification.--
       ``(A) In general.--A candidate shall notify the Commission 
     of an intent to increase an expenditure limit under paragraph 
     (1).
       ``(B) Commission response.--Within 3 business days of 
     receiving a notice under subparagraph (A), the Commission 
     must approve or deny the increase in expenditure limit.
       ``(C) Additional notification.--A candidate who has 
     increased an expenditure limit under paragraph (1) shall 
     notify the Commission of each additional increase in 
     increments of $50,000.''.

     SEC. 205. CLARIFICATION OF DEFINITIONS RELATING TO 
                   INDEPENDENT EXPENDITURES.

       (a) Definition of Independent Expenditure.--Section 301 of 
     the Federal Election Campaign Act of 1971 (2 U.S.C. 431) is 
     amended by striking paragraph (17) and inserting the 
     following:
       ``(17) Independent expenditure.--The term `independent 
     expenditure' means an expenditure that--
       (A) contains express advocacy; and
       (B) is made without the participation or cooperation of, or 
     without consultation with, or without coordination with a 
     candidate or a candidate's authorized committee or agent 
     (within the meaning of section 301(8)(C)).''.
       (b) Definition of Express Advocacy.--Section 301 of Federal 
     Election Campaign Act of 1971 (2 U.S.C. 431), as amended by 
     section 202(c), is amended by adding at the end the 
     following:
       ``(21) Express advocacy.--The term `express advocacy' 
     includes--
       ``(i) a communication that conveys a message that advocates 
     the election or defeat of a clearly identified candidate for 
     Federal office by using an expression such as `vote for,' 
     `elect,' `support,' `vote against,' `defeat,' `reject,' 
     `(name of candidate) for Congress,' `vote pro-life,' or `vote 
     pro-choice,' accompanied by a listing or picture of a clearly 
     identified candidate described as `pro-life' or `pro-choice,' 
     `reject the incumbent,' or an expression susceptible to no 
     other reasonable interpretation but an unmistakable and 
     unambiguous exhortation to vote for or against a specific 
     candidate; or
       ``(ii) a communication that is made through a broadcast 
     medium, newspaper, magazine, billboard, direct mail, or 
     similar type of general public communication or political 
     advertising--
       ``(A) that is made on or after a date that is 90 days 
     before the date of a general election of the candidate;
       ``(B) that refers to the character, qualifications, or 
     accomplishments of a clearly identified candidate, group of 
     candidates, or candidate of a clearly identified political 
     party; and
       ``(C) that does not have as its sole purpose an attempt to 
     urge action on legislation that has been introduced in or is 
     being considered by a legislature that is in session.''.

     SEC. 206. ELIMINATION OF LEADERSHIP PACS.

       (a) Designation and Establishment of Authorized 
     Committee.--Section 302(e) of the Federal Election Campaign 
     Act of 1971 (2 U.S.C. 432(e)) is amended by--
       (1) striking paragraph (3) and inserting the following:
       ``(3) No political committee that supports, or has 
     supported, more than one candidate may be designated as an 
     authorized committee, except that--
       ``(A) a candidate for the office of President nominated by 
     a political party may designate the national committee of 
     such political party as the candidate's principal campaign 
     committee, if that national committee maintains separate 
     books of account with respect to its functions as a principal 
     campaign committee; and
       ``(B) a candidate may designate a political committee 
     established solely for the purpose of joint fundraising by 
     such candidates as an authorized committee.''; and
       (2) adding at the end the following:
       ``(6)(A) A candidate for Federal office or any individual 
     holding Federal office may not directly or indirectly 
     establish, finance, maintain, or control any political 
     committee other than a principal campaign committee of the 
     candidate, designated in accordance with paragraph (3). A 
     candidate for more than one Federal office may designate a 
     separate principal campaign committee for each Federal 
     office. This paragraph shall not preclude a Federal 
     officeholder who is a candidate for State or local office 
     from establishing, financing, maintaining, or controlling a 
     political committee for election of the individual to such 
     State or local office.
       ``(B) A political committee prohibited by subparagraph (A), 
     that is established before the date of enactment of this Act, 
     may continue to make contributions for a period that ends on 
     the date that is 1 year after the date of enactment of this 
     paragraph. At the end of such period the political committee 
     shall disburse all funds by 1 or more of the following means:
       ``(1) Making contributions to an entity described in 
     section 501(c)(3) of the Internal Revenue Code of 1986 and 
     exempt from taxation under section 501(a) of such Act that is 
     not established, maintained, financed, or controlled directly 
     or indirectly by any candidate for Federal office or any 
     individual holding Federal office.
       ``(2) Making a contribution to the Treasury.
       ``(3) Making contributions to the national, State, or local 
     committees of a political party.
       ``(4) Making contributions not to exceed $1,000 to 
     candidates for elective office.''.
                         TITLE III--SOFT MONEY

     SEC. 301. SOFT MONEY OF POLITICAL PARTY COMMITTEE.

       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. SOFT MONEY OF PARTY COMMITTEES.

       ``(a) National Committees.--A national committee of a 
     political party (including a national congressional campaign 
     committee of a political party), an entity that is directly 
     or indirectly established, financed, maintained, or 
     controlled by a national committee or its agent, an entity 
     acting on behalf of a national committee, and an officer or 
     agent acting on behalf of any such committee or entity (but 
     not including an entity regulated under subsection (b)) shall 
     not solicit or receive any contributions, donations, or 
     transfers of funds, or spend any funds, that are not subject 
     to the limitations, prohibitions, and reporting requirements 
     of this Act.
       ``(b) State, District, and Local Committees.--
       ``(1) In general.--Any amount that is expended or disbursed 
     by a State, district, or local committee of a political party 
     (including an entity that is directly or indirectly 
     established, financed, maintained, or controlled by a State, 
     district, or local committee of a political party and an 
     officer or agent acting on behalf of any such committee or 
     entity) during a calendar year in which a Federal election is 
     held, for any activity that might affect the outcome of a 
     Federal election, including any voter registration or get-
     out-the-vote activity, any generic campaign activity, and any 
     communication that refers to a candidate (regardless of 
     whether a candidate for State or local office is also 
     mentioned or identified) shall be made from funds subject to 
     the limitations, prohibitions, and reporting requirements of 
     this Act.
       ``(2) Activity excluded from paragraph (1).--
       ``(A) In general.--Paragraph (1) shall not apply to an 
     expenditure or disbursement made by a State, district, or 
     local committee of a political party for--

[[Page S7956]]

       ``(i) a contribution to a candidate for State or local 
     office if the contribution is not designated or otherwise 
     earmarked to pay for an activity described in paragraph (1);
       ``(ii) the costs of a State, district, or local political 
     convention;
       ``(iii) the non-Federal share of a State, district, or 
     local party committee's administrative and overhead expenses 
     (but not including the compensation in any month of any 
     individual who spends more than 20 percent of the 
     individual's time on activity during the month that may 
     affect the outcome of a Federal election) except that for 
     purposes of this paragraph, the non-Federal share of a party 
     committee's administrative and overhead expenses shall be 
     determined by applying the ratio of the non-Federal 
     disbursements to the total Federal expenditures and non-
     Federal disbursements made by the committee during the 
     previous presidential election year to the committee's 
     administrative and overhead expenses in the election year in 
     question;
       ``(iv) the costs of grassroots campaign materials, 
     including buttons, bumper stickers, and yard signs that name 
     or depict only a candidate for State or local office; and
       ``(v) the cost of any campaign activity conducted solely on 
     behalf of a clearly identified candidate for State or local 
     office, if the candidate activity is not an activity 
     described in paragraph (1).
       ``(B) Fundraising costs.--Any amount spent by a national, 
     State, district, or local committee, by an entity that is 
     established, financed, maintained, or controlled by a State, 
     district, or local committee of a political party, or by an 
     agent or officer of any such committee or entity to raise 
     funds that are used, in whole or in part, to pay the costs of 
     an activity described in paragraph (1) shall be made from 
     funds subject to the limitations, prohibitions, and reporting 
     requirements of this Act.
       ``(c) Tax-exempt organizations.--A national, State, 
     district, or local committee of a political party (including 
     a national congressional campaign committee of a political 
     party, an entity that is directly or indirectly established, 
     financed, maintained, or controlled by any such national, 
     State, district, or local committee or its agent, an agent 
     acting on behalf of any such party committee, and an officer 
     or agent acting on behalf of any such party committee or 
     entity), shall not solicit any funds for or make any 
     donations to an organization that is exempt from Federal 
     taxation under section 501(c) of the Internal Revenue Code of 
     1986.
       ``(d) Candidates.--
       ``(1) In general.--A candidate, individual holding Federal 
     office, or agent of a candidate or individual holding Federal 
     office shall not--
       ``(A) solicit, receive, transfer, or spend funds in 
     connection with an election for Federal office unless the 
     funds are subject to the limitations, prohibitions, and 
     reporting requirements of this Act;
       ``(B) solicit, receive, or transfer funds that are to be 
     expended in connection with any election other than a Federal 
     election unless the funds--
       ``(i) are not in excess of the amounts permitted with 
     respect to contributions to candidates and political 
     committees under section 315(a) (1) and (2); and
       ``(ii) are not from sources prohibited by this Act from 
     making contributions with respect to an election for Federal 
     office; or
       ``(C) solicit, receive, or transfer any funds on behalf of 
     any person that are not subject to the limitations, 
     prohibitions, and reporting requirements of the Act if the 
     funds are for use in financing any campaign-related activity 
     or any communication that refers to a clearly identified 
     candidate for Federal office.
       ``(2) Exception.--Paragraph (1) does not apply to the 
     solicitation or receipt of funds by an individual who is a 
     candidate for a State or local office if the solicitation or 
     receipt of funds is permitted under State law for the 
     individual's State or local campaign committee.''.

     SEC. 302. STATE PARTY GRASSROOTS FUNDS.

       (a) Individual Contributions.--Section 315(a)(1) of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 441a(a)(1)) 
     is amended--
       (1) in subparagraph (B), by striking ``or'' at the end;
       (2) in subparagraph (C), by striking the period at the end 
     and inserting ``; or''; and
       (3) by inserting after subparagraph (C) the following:
       ``(D) to--
       ``(i) a State Party Grassroots Fund established and 
     maintained by a State committee of a political party in any 
     calendar year which, in the aggregate, exceed $20,000;
       ``(ii) any other political committee established and 
     maintained by a State committee of a political party in any 
     calendar year which, in the aggregate, exceed $5,000;

     except that the aggregate contributions described in this 
     subparagraph that may be made by a person to the State Party 
     Grassroots Fund and all committees of a State Committee of a 
     political party in any State in any calendar year shall not 
     exceed $20,000.''.
       (b) Limits.--
       (1) In general.--Section 315(a) of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 441a(a)) is amended by 
     striking paragraph (3) and inserting the following:
       ``(3) Overall limits.--
       ``(A) Individual limit.--No individual shall make 
     contributions during any calendar year that, in the 
     aggregate, exceed $30,000.
       ``(B) Calendar year.--No individual shall make 
     contributions during any calendar year--
       ``(i) to all candidates and their authorized political 
     committees that, in the aggregate, exceed $25,000; or
       ``(ii) to all political committees established and 
     maintained by State committees of a political party that, in 
     the aggregate, exceed $20,000.
       ``(C) Nonelection years.--For purposes of subparagraph 
     (B)(i), any contribution made to a candidate or the 
     candidate's authorized political committees in a year other 
     than the calendar year in which the election is held with 
     respect to which the contribution is made shall be treated as 
     being made during the calendar year in which the election is 
     held.''.
       (c) Definitions.--Section 301 of the Federal Election 
     Campaign Act of 1970 (2 U.S.C. 431), as amended by section 
     205(b), is amended by adding at the end the following:
       ``(22) Generic campaign activity.--The term `generic 
     campaign activity' means a campaign activity that promotes a 
     political party and does not refer to any particular Federal 
     or non-Federal candidate.
       ``(23) State Party Grassroots Fund.--The term `State Party 
     Grassroots Fund' means a separate segregated fund established 
     and maintained by a State committee of a political party 
     solely for purposes of making expenditures and other 
     disbursements described in section 326(d).''.
       (d) State Party Grassroots Funds.--Title III of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 431 et seq.), as 
     amended by section 301, is amended by adding at the end the 
     following:

     ``SEC. 326. STATE PARTY GRASSROOTS FUNDS.

       ``(a) Definition.--In this section, the term `State or 
     local candidate committee' means a committee established, 
     financed, maintained, or controlled by a candidate for other 
     than Federal office.
       ``(b) Transfers.--Notwithstanding section 315(a)(4), no 
     funds may be transferred by a State committee of a political 
     party from its State Party Grassroots Fund to any other State 
     Party Grassroots Fund or to any other political committee, 
     except a transfer may be made to a district or local 
     committee of the same political party in the same State if 
     the district or local committee--
       ``(1) has established a separate segregated fund for the 
     purposes described in subsection (d); and
       ``(2) uses the transferred funds solely for those purposes.
       ``(c) Amounts Received by Grassroots Funds From State and 
     Local Candidate Committees.--
       ``(1) In general.--Any amount received by a State Party 
     Grassroots Fund from a State or local candidate committee for 
     expenditures described in subsection (d) that are for the 
     benefit of that candidate shall be treated as meeting the 
     requirements of 325(b)(1) and section 304(e) if--
       ``(A) the amount is derived from funds which meet the 
     requirements of this Act with respect to any limitation or 
     prohibition as to source or dollar amount specified in 
     section 315(a) (1)(A) and (2)(A); and
       ``(B) the State or local candidate committee--
       ``(i) maintains, in the account from which payment is made, 
     records of the sources and amounts of funds for purposes of 
     determining whether those requirements are met; and
       ``(ii) certifies that the requirements were met.
       ``(2) Determination of compliance.--For purposes of 
     paragraph (1)(A), in determining whether the funds 
     transferred meet the requirements of this Act described in 
     paragraph (1)(A)--
       ``(A) a State or local candidate committee's cash on hand 
     shall be treated as consisting of the funds most recently 
     received by the committee; and
       ``(B) the committee must be able to demonstrate that its 
     cash on hand contains funds meeting those requirements 
     sufficient to cover the transferred funds.
       ``(3) Reporting.--Notwithstanding paragraph (1), any State 
     Party Grassroots Fund that receives a transfer described in 
     paragraph (1) from a State or local candidate committee shall 
     be required to meet the reporting requirements of this Act, 
     and shall submit to the Commission all certifications 
     received, with respect to receipt of the transfer from the 
     candidate committee.
       ``(d) Disbursements and Expenditures.--A State committee of 
     a political party may make disbursements and expenditures 
     from its State Party Grassroots Fund only for--
       ``(1) any generic campaign activity;
       ``(2) payments described in clauses (v), (ix), and (xi) of 
     paragraph (8)(B) and clauses (iv), (viii), and (ix) of 
     paragraph (9)(B) of section 301;
       ``(3) subject to the limitations of section 315(d), 
     payments described in clause (xii) of paragraph (8)(B), and 
     clause (ix) of paragraph (9)(B), of section 301 on behalf of 
     candidates other than for President and Vice President;
       ``(4) voter registration; and
       ``(5) development and maintenance of voter files during an 
     even-numbered calendar year.''.

     SEC. 303. REPORTING REQUIREMENTS.

       (a) Reporting Requirements.--Section 304 of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 434) is amended by 
     adding at the end the following:
       ``(e) Political Committees.--
       ``(1) National and congressional political committees.--The 
     national committee of

[[Page S7957]]

     a political party, any congressional campaign committee of a 
     political party, and any subordinate committee of either, 
     shall report all receipts and disbursements during the 
     reporting period, whether or not in connection with an 
     election for Federal office.
       ``(2) Other political committees to which section 325 
     applies.--A political committee (not described in paragraph 
     (1)) to which section 325(b)(1) applies shall report all 
     receipts and disbursements made for activities described in 
     paragraphs (1) and (2)(iii) of section 325(b).
       (3) Other political committees.--Any political committee to 
     which paragraph (1) or (2) does not apply shall report any 
     receipts or disbursements that are used in connection with a 
     Federal election.
       ``(4) Itemization.--If a political committee has receipts 
     or disbursements to which this subsection applies from any 
     person aggregating in excess of $200 for any calendar year, 
     the political committee shall separately itemize its 
     reporting for such person in the same manner as required in 
     paragraphs (3)(A), (5), and (6) of subsection (b).
       ``(5) Reporting periods.--Reports required to be filed 
     under this subsection shall be filed for the same time 
     periods required for political committees under subsection 
     (a).''.
       (b) Building Fund Exception to the Definition of 
     Contribution.--Section 301(8) of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 431(8)) is amended--
       (1) by striking clause (viii); and
       (2) by redesignating clauses (ix) through (xiv) as clauses 
     (viii) through (xiii), respectively.
       (c) Reports by State Committees.--Section 304 of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 434), as 
     amended by subsection (a), is amended by adding at the end 
     the following:
       ``(f) Filing of State Reports.--In lieu of any report 
     required to be filed by this Act, the Commission may allow a 
     State committee of a political party to file with the 
     Commission a report required to be filed under State law if 
     the Commission determines such reports contain substantially 
     the same information.''.
       (d) Other Reporting Requirements.--
       (1) Authorized committees.--Section 304(b)(4) of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 434(b)(4)) is 
     amended--
       (A) by striking ``and'' at the end of subparagraph (H);
       (B) by inserting ``and'' at the end of subparagraph (I); 
     and
       (C) by adding at the end the following new subparagraph:
       ``(J) in the case of an authorized committee, disbursements 
     for the primary election, the general election, and any other 
     election in which the candidate participates;''.
       (2) Names and addresses.--Section 304(b)(5)(A) of the 
     Federal Election Campaign Act of 1971 (2 U.S.C. 434(b)(5)(A)) 
     is amended by inserting ``, and the election to which the 
     operating expenditure relates'' after ``operating 
     expenditure''.

     SEC. 304. SOFT MONEY OF PERSONS OTHER THAN POLITICAL PARTIES.

       Section 304 of the Federal Election Campaign Act of 1971 (2 
     U.S.C. 434), as amended by subsection 303, is amended by 
     adding at the end the following:
       ``(g) Election Activity of Persons Other Than Political 
     Parties.--
       ``(1) In general.--A person other than a committee of a 
     political party that makes aggregate disbursements totaling 
     in excess of $10,000 for activities described in paragraph 
     (2) shall file a statement with the Commission--
       ``(A) within 48 hours after the disbursements are made; or
       ``(B) in the case of disbursements that are made within 20 
     days of an election, within 24 hours after the disbursements 
     are made.
       ``(2) Activity.--The activity described in this paragraph 
     is--
       ``(A) any activity described in section 316(b)(2)(A) that 
     refers to any candidate for Federal office, any political 
     party, or any Federal election; and
       ``(B) any activity described in subparagraph (B) or (C) of 
     section 316(b)(2).
       ``(3) Additional statements.--An additional statement shall 
     be filed each time additional disbursements aggregating 
     $10,000 are made by a person described in paragraph (1).
       ``(4) Applicability.--This subsection does not apply to--
       ``(A) a candidate or a candidate's authorized committees; 
     or
       ``(B) an independent expenditure.
       ``(5) Contents.--A statement under this section shall 
     contain such information about the disbursements as the 
     Commission shall prescribe, including--
       ``(A) the name and address of the person or entity to whom 
     the disbursement was made;
       ``(B) the amount and purpose of the disbursement; and
       ``(C) if applicable, whether the disbursement was in 
     support of, or in opposition to, a candidate or a political 
     party, and the name of the candidate or the political 
     party.''.
                         TITLE IV--ENFORCEMENT

     SEC. 401. FILING OF REPORTS USING COMPUTERS AND FACSIMILE 
                   MACHINES.

       Section 302(a) of the Federal Election Campaign Act of 1971 
     (2 U.S.C. 434(a)) is amended by striking paragraph (11) and 
     inserting the following:
       ``(11) Filing of reports using computers and facsimile 
     machines.--
       ``(A) Required filing.--The Commission may promulgate a 
     regulation under which a person required to file a 
     designation, statement, or report under this Act--
       ``(i) is required to maintain and file a designation, 
     statement, or report for any calendar year in electronic form 
     accessible by computers if the person has, or has reason to 
     expect to have, aggregate contributions or expenditures in 
     excess of a threshold amount determined by the Commission; 
     and
       ``(ii) may maintain and file a designation, statement, or 
     report in that manner if not required to do so under 
     regulations prescribed under clause (i).
       ``(B) Facsimile machine.--The Commission shall promulgate a 
     regulation that allows a person to file a designation, 
     statement, or report required by this Act through the use of 
     facsimile machines.
       ``(C) Verification of signature.--
       ``(i) In general.--In promulgating a regulation under this 
     paragraph, the Commission shall provide methods (other than 
     requiring a signature on the document being filed) for 
     verifying a designation, statement, or report covered by the 
     regulations.
       ``(ii) Treatment of verification.--A document verified 
     under any of the methods shall be treated for all purposes 
     (including penalties for perjury) in the same manner as a 
     document verified by signature.''.

     SEC. 402. AUDITS.

       (a) Random Audits.--Section 311(b) of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 438(b)) is amended--
       (1) by inserting ``(1)'' before ``The Commission''; and
       (2) by adding at the end the following:
       ``(2) Random audits.--
       ``(A) In general.--Notwithstanding paragraph (1), the 
     Commission may conduct random audits and investigations to 
     ensure voluntary compliance with this Act.
       ``(B) Limitation.--The Commission shall not institute an 
     audit or investigation of a candidate's authorized committee 
     under subparagraph (A) until the candidate is no longer a 
     candidate for the office sought by the candidate in that 
     election cycle.
       ``(C) Applicability.--This paragraph does not apply to an 
     authorized committee of a candidate for President or Vice 
     President subject to audit under section 9007 or 9038 of the 
     Internal Revenue Code of 1986.''.
       (b) Extension of Period During Which Campaign Audits May Be 
     Begun.--Section 311(b) of the Federal Election Campaign Act 
     of 1971 (2 U.S.C. 438(b)) is amended by striking ``6 months'' 
     and inserting ``12 months''.

     SEC. 403. AUTHORITY TO SEEK INJUNCTION.

       Section 309(a) of the Federal Election Campaign Act of 1971 
     (2 U.S.C. 437g(a)) is amended--
       (1) by adding at the end the following:
       ``(13) Authority to seek injunction.--
       ``(A) In general.--If, at any time in a proceeding 
     described in paragraph (1), (2), (3), or (4), the Commission 
     believes that--
       ``(i) there is a substantial likelihood that a violation of 
     this Act is occurring or is about to occur;
       ``(ii) the failure to act expeditiously will result in 
     irreparable harm to a party affected by the potential 
     violation;
       ``(iii) expeditious action will not cause undue harm or 
     prejudice to the interests of others; and
       ``(iv) the public interest would be best served by the 
     issuance of an injunction;
     the Commission may initiate a civil action for a temporary 
     restraining order or a preliminary injunction pending the 
     outcome of the proceedings described in paragraphs (1), (2), 
     (3), and (4).
       ``(B) Venue.--An action under subparagraph (A) shall be 
     brought in the United States district court for the district 
     in which the defendant resides, transacts business, or may be 
     found, or in which the violation is occurring, has occurred, 
     or is about to occur.'';
       (2) in paragraph (7), by striking ``(5) or (6)'' and 
     inserting ``(5), (6), or (13)''; and
       (3) in paragraph (11), by striking ``(6)'' and inserting 
     ``(6) or (13)''.

     SEC. 404. INCREASE IN PENALTY FOR KNOWING AND WILLFUL 
                   VIOLATIONS.

       Section 309(a)(5)(B) of the Federal Election Campaign Act 
     of 1971 (2 U.S.C. 437g(a)(5)(B)) is amended by striking ``the 
     greater of $10,000 or an amount equal to 200 percent'' and 
     inserting ``the greater of $15,000 or an amount equal to 300 
     percent''.

     SEC. 405. PROHIBITION OF CONTRIBUTIONS BY INDIVIDUALS NOT 
                   QUALIFIED TO VOTE.

       (a) Prohibition.--Section 319 of the Federal Election 
     Campaign Act of 1971 (2 U.S.C. 441e) is amended--
       (1) in the heading by adding ``AND INDIVIDUALS NOT 
     QUALIFIED TO REGISTER TO VOTE'' at the end; and
       (2) in subsection (a)--
       (A) by striking ``(a) It shall'' and inserting the 
     following:
       ``(a) Prohibitions.--
       ``(1) Foreign nationals.--It shall''; and
       (B) by adding at the end the following:
       ``(2) Individuals not qualified to vote.--It shall be 
     unlawful for an individual who is not qualified to register 
     to vote in a Federal election to make a contribution, or to 
     promise expressly or impliedly to make a contribution, in 
     connection with a Federal election; or for any person to 
     knowingly solicit, accept, or receive a contribution in 
     connection with a Federal election from an individual who is 
     not qualified to register to vote in a Federal election.''.
       (b) Inclusion in Definition of Identification.--Section 
     301(13) of the Federal Election

[[Page S7958]]

     Campaign Act of 1971 (2 U.S.C. 431(13)) is amended--
       (1) in subparagraph (A)--
       (A) by striking ``and'' the first place it appears; and
       (B) by inserting ``, and an affirmation that the individual 
     is an individual who is not prohibited by section 319 from 
     making a contribution'' after ``employer''; and
       (2) in subparagraph (B) by inserting ``and an affirmation 
     that the person is a person that is not prohibited by section 
     319 from making a contribution'' after ``such person''.

     SEC. 406. USE OF CANDIDATES' NAMES.

       Section 302(e) of the Federal Election Campaign Act of 1971 
     (2 U.S.C. 432(e)) is amended by striking paragraph (4) and 
     inserting the following:
       ``(4)(A) The name of each authorized committee shall 
     include the name of the candidate who authorized the 
     committee under paragraph (1).
       ``(B) A political committee that is not an authorized 
     committee shall not--
       ``(i) include the name of any candidate in its name, or
       ``(ii) except in the case of a national, State, or local 
     party committee, use the name of any candidate in any 
     activity on behalf of such committee in such a context as to 
     suggest that the committee is an authorized committee of the 
     candidate or that the use of the candidate's name has been 
     authorized by the candidate.''.

     SEC. 407. EXPEDITED PROCEDURES.

       Section 309(a) of the Federal Election Campaign Act of 1971 
     (2 U.S.C. 437g(a)), as amended by section 403, is amended by 
     adding at the end the following:
       ``(14) Expedited procedure.--
       ``(A) 60 days preceding an election.--If the complaint in a 
     proceeding was filed within 60 days immediately preceding a 
     general election, the Commission may take action described in 
     this subparagraph.
       ``(B) Resolution before election.--If the Commission 
     determines, on the basis of facts alleged in the complaint 
     and other facts available to the Commission, that there is 
     clear and convincing evidence that a violation of this Act 
     has occurred, is occurring, or is about to occur and it 
     appears that the requirements for relief stated in paragraph 
     (13)(A) (ii), (iii), and (iv) are met, the Commission may--
       ``(i) order expedited proceedings, shortening the time 
     periods for proceedings under paragraphs (1), (2), (3), and 
     (4) as necessary to allow the matter to be resolved in 
     sufficient time before the election to avoid harm or 
     prejudice to the interests of the parties; or
       ``(ii) if the Commission determines that there is 
     insufficient time to conduct proceedings before the election, 
     immediately seek relief under paragraph (13)(A).
       ``(C) Complaint without merit.--If the Commission 
     determines, on the basis of facts alleged in the complaint 
     and other facts available to the Commission, that the 
     complaint is clearly without merit, the Commission may--
       ``(i) order expedited proceedings, shortening the time 
     periods for proceedings under paragraphs (1), (2), (3), and 
     (4) as necessary to allow the matter to be resolved in 
     sufficient time before the election to avoid harm or 
     prejudice to the interests of the parties; or
       ``(ii) if the Commission determines that there is 
     insufficient time to conduct proceedings before the election, 
     summarily dismiss the complaint.''.
           TITLE V--SEVERABILITY; REGULATIONS; EFFECTIVE DATE

     SEC. 501. SEVERABILITY.

       If any provision of this Act or amendment made by this Act, 
     or the application of a provision or amendment to any person 
     or circumstance, is held to be unconstitutional, the 
     remainder of this Act and amendments made by this Act, and 
     the application of the provisions and amendment to any person 
     or circumstance, shall not be affected by the holding.

     SEC. 502. REGULATIONS.

       The Federal Election Commission shall promulgate any 
     regulations required to carry out this Act and the amendments 
     made by this Act.

     SEC. 503. EFFECTIVE DATE.

       Except as otherwise provided in this Act, this Act and the 
     amendments made by this Act take effect on the date that is 
     30 days after the date of enactment of this Act.

                               Exhibit 1

         [From the Secretary of State, State of West Virginia]

       On May 20, officials of 33 states, including secretaries of 
     state, attorneys general and state regulators of campaign 
     finance (in those states where the secretary of state does 
     not have that responsibility) registered their support of a 
     court challenge to the 1976 U.S. Supreme Court decision in 
     the case of Buckley v. Valeo. The officials in these 33 
     states made known their support as amicus curiae in a pending 
     appeal in the 6th Circuit Court of Appeals in a case entitled 
     Kruse v. City of Cincinnati, which concerns a Cincinnati 
     ordinance limiting candidates for the city council to 
     spending no more than three times their annual salary. The 
     ordinance was declared unconstitutional by a Federal district 
     court, based on the Buckley v. Valeo decision, which ruled 
     that such limits violated First Amendment freedom of speech 
     protection. Whichever way the 6th Circuit Court of Appeals 
     rules, it is almost certain to be appealed to the U.S. 
     Supreme Court, thus paving the way for a re-argument of 
     Buckley v. Valeo.
       Officials in the following states filed the amicus brief:
       Arizona--A.G.
       Arkansas--SOS and A.G.
       Connecticut--SOS and A.G.
       Florida--SOS and A.G.
       Georgia--SOS.
       Hawaii--Campaign Spending Commisison and A.G.
       Indiana--A.G.
       Iowa--A.G.
       Kansas--A.G.
       Kentucky--Registry of Campaign Finance and A.G.
       Maine--SOS.
       Massachusetts--SOS and A.G.
       Michigan--A.G.
       Minnesota--SOS and A.G.
       Mississippi--SOS.
       Montana--SOS and A.G.
       Nevada--SOS and A.G.
       New Hampshire--SOS and A.G.
       New Mexico--SOS.
       North Carolina--Chief Elections Officer.
       North Dakota--A.G.
       Ohio--A.G.
       Oklahoma--Ethics Commission and A.G.
       Oregon--SOS and A.G.
       Rhode Island--SOS.
       South Carolina--SOS.
       South Dakota--A.G.
       Tennessee--SOS.
       Utah--A.G.
       Vermont--A.G.
       Washington--SOS and A.G.
       West Virginia--SOS and A.G.
       Wisconsin--SOS.
       Territory of Guam--Lt. Gov. and A.G.
                                                                    ____


            [From the Department of Justice, State of Iowa]


 24 state attorneys general issue call for the reversal of buckley v. 
                                 valeo

       Des Moines, Iowa--The attorneys general for twenty-four 
     states released a joint statement Tuesday calling for the 
     reversal of a 1976 Supreme Court decision which struck down 
     mandatory campaign spending limits on free speech grounds. 
     The attorneys general statement comes amidst a growing 
     national debate about the validity of that court ruling, 
     Buckley v. Valeo.
       Former U.S. Senator Bill Bradley has denounced the decision 
     and has helped lead the recent push in the U.S. Congress for 
     a constitutional amendment to allow for mandatory spending 
     limits in federal elections. The City of Cincinnati is 
     litigating the first direct court challenge to the ruling, 
     defending an ordinance passed in 1995 by the City Council 
     which sets limits in city council races. And, in late October 
     1996, a group of prominent constitutional scholars from 
     around the nation signed a statement calling for the reversal 
     of Buckley.
       The attorneys general statement reads as follows:
       ``Over two decades ago, the United States Supreme Court, in 
     Buckley v. Valeo, 424 U.S. 1 (1976), declared mandatory 
     campaign expenditure limits unconstitutional on First 
     Amendment grounds. We, the undersigned state attorneys 
     general, believe the time has come for that holding to be 
     revisited and reversed.
       ``U.S. Supreme Court Justice Louis Brandeis once wrote 
     `[I]n cases involving the Federal Constitution, where 
     correction through legislative action is practically 
     impossible, this court has often overruled its earlier 
     decision. The court bows to the lessons of experience and the 
     force of better reasoning . . .' Burnet v. Coronado Oil & Gas 
     Co., 285 U.S. 393, 406-408 (1932) (Brandeis, J., dissenting).
       ``As state attorneys general--many of us elected--we 
     believe the experience of campaigns teaches the lesson that 
     unlimited campaign spending threatens the integrity of the 
     election process. As the chief legal officers of our 
     respective states, we believe that the force of better 
     reasoning compels the conclusion that it is the absence of 
     limits on campaign expenditures--not the restrictions--which 
     strike `at the core of our electoral process and of the First 
     Amendment freedoms.' Buckley v. Valeo, 424 U.S. 1, 39 (1976) 
     (quoting Williams v. Rhodes, 393 U.S. 23, 32 (1968).''
       The United States has witnessed a more than a 700% increase 
     in the cost of federal elections since the Buckley ruling. 
     The presidential and congressional campaigns combined spent 
     more than $2 billion this past election cycle, making the 
     1996 elections the costliest ever in U.S. history.
       Iowa Attorney General Tom Miller, Nevada Attorney General 
     Frankie Sue Del Papa, Arizona Attorney General Grant Woods, 
     and the National Voting Rights Institute of Boston initiated 
     Tuesday's statement. The Institute is a non-profit 
     organization engaged in constitutional challenges across the 
     country to the current campaign finance system. The Institute 
     serves as special counsel for the City of Cincinnati in its 
     challenge to Buckley, now in federal district court in 
     Cincinnati and due for its first court hearing on January 31,
       ``Buckley stands today as a barrier to American 
     democracy,'' says Attorney General Del Papa. ``As state 
     attorneys general, we are committed to helping remove that 
     barrier.'' Del Papa says the twenty-four state attorneys 
     general will seek to play an active role in efforts to 
     reverse the Buckley decision, including the submission of 
     friend-of-the-court briefs in emerging court cases which 
     address the ruling.
       ``Maybe it wasn't clear in 1976, but it is clear today that 
     financing of campaigns has gotten totally out of control,'' 
     says Iowa Attorney General Tom Miller. ``The state has a 
     compelling interest in bringing campaign finances back under 
     control and protecting the integrity of the electoral 
     process.''

[[Page S7959]]

       Arizona Attorney General Grant Woods adds, ``I believe that 
     it is a major stretch to say that the First Amendment 
     requires that no restrictions be placed on individual 
     campaign spending. The practical results, where millionaires 
     dominate the process to the detriment of nearly everyone who 
     cannot compete financially, have perverted the electoral 
     process in America.''
       The full listing of signatories is as follows:
       Attorney General Grant Woods of Arizona (R).
       Attorney General Richard Blumenthal of Connecticut (D).
       Attorney General Robert Butterworth of Florida (D).
       Attorney General Alan G. Lance of Idaho (R).
       Attorney General Tom Miller of Iowa (D).
       Attorney General Carla J. Stovall of Kansas (R).
       Attorney General Albert B. Chandler III of Kentucky (D).
       Attorney General Andrew Ketterer of Maine (D).
       Attorney General Scott Harshbargor of Massachusetts (D).
       Attorney General Frank Kelley of Michigan (D).
       Attorney General Hubert H. Humphrey of Minnesota (D).
       Attorney General Mike Moore of Mississippi (D).
       Attorney General Joseph P. Mazurek of Montana (D).
       Attorney General Frankie Sue Del Papa of Nevada (D).
       Attorney General Jeff Howard of New Hampshire (R).
       Attorney General Tom Udall of New Mexico (D).
       Attorney General Heidi Heitkamp of North Dakota (D).
       Attorney General Drew Edmondson of Oklahoma (D).
       Attorney General Charles W. Burson of Tennessee (D).
       Attorney General Jan Graham of Utah (D).
       Attorney General Wallace Malley of Vermont (R).
       Attorney General Darrel V. McGraw of West Virginia (D).
       Attorney General Christine O. Gregoire of Washington (D).
       Attorney General James Doyle of Wisconsin (D).
                                 ______