[Congressional Record Volume 146, Number 127 (Thursday, October 12, 2000)]
[Senate]
[Pages S10417-S10418]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. MURKOWSKI:
  S. 3193. A bill to amend section 527 of the Internal Revenue Code of 
1986 to exempt State and local political committees from required 
notification of section 527 status; to the Committee on Finance.


                     finance disclosure legislation

  Mr. MURKOWSKI. Mr. President, in our desire to close the so-called 
527 loophole involving campaign financing earlier this year, I believe 
we may have gone too far in the disclosure requirements.
  In the bill ultimately creating P.L. 106-230, we essentially adopted 
the House language without any amendments. When it became law on July 
1, 2000, one of the provisions required candidates for state and local 
offices to file Form 8871 by July 31, 2000.
  The goal of the new law is to find out who is contributing to 527 
political organizations that have proliferated in recent years. The 
organizations. including the Sierra Club's 527, were taking in large 
size donations and yet not have and to reveal who the donors were.
  Under the new law, contributions in excess of $200 by a single person 
must be disclosed. Expenditures by a 527 organization in excess of $500 
also would have to be disclosed. However, these financial disclosures--
the heart and soul of the bill--do not apply to candidates for state 
and local elections. Clearly, the rules for state and local elections 
are to be regulated by the states, not the federal government.
  Yet, under the new law, candidates for state and local offices must 
file Form 8871 with the IRS. This form essentially notifies IRS that 
state or local officeholder has established a 527

[[Page S10418]]

organization. It must also list the name and address of the 
organization, the purpose of the organization; the names and addresses 
of its officers and highly compensated persons and identify a contact 
person and custodian of records and its Board of Directors (if any).
  Since we have exempted state and local candidates from having to file 
financial disclosure statements, I see no reason why they should be 
burdened with filing Form 8857. This requirement serves no purpose 
except to create needless paperwork for both the candidates and the 
IRS.
  That is why I am introducing legislation to exempt state and local 
candidates from this burden just as the current law exempts 527 
Organizations that do not expect that they will raise $25,000 do not 
have to file this information.
  My bill is retroactive so that some candidates for local office who 
were caught unaware of the filing requirement do not face any 
penalties.
  It is my hope that after this election, when campaign finance reform 
will be debated in a less political environment, that this common sense 
technical amendment will be included in reform legislation.
                                 ______