[Congressional Record Volume 152, Number 42 (Wednesday, April 5, 2006)]
[House]
[Pages H1514-H1529]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                         527 REFORM ACT OF 2005

  Mr. EHLERS. Mr. Speaker, pursuant to House Resolution 755, I call up 
the bill (H.R. 513) to amend the Federal Election Campaign Act of 1971 
to clarify when organizations described in section 527 of the Internal 
Revenue Code of 1986 must register as political committees, and for 
other purposes, and ask for its immediate consideration in the House.
  The Clerk read the title of the bill.
  The SPEAKER pro tempore (Mr. LaHood). Pursuant to House Resolution 
755, the bill is considered read.
  The text of H.R. 513 is as follows:

                                H.R. 513

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``527 Reform Act of 2005''.

[[Page H1515]]

     SEC. 2. TREATMENT OF SECTION 527 ORGANIZATIONS.

       (a) Definition of Political Committee.--Section 301(4) of 
     the Federal Election Campaign Act of 1971 (2 U.S.C. 431(4)) 
     is amended by striking the period at the end of subparagraph 
     (C) and inserting ``; or'' and by adding at the end the 
     following:
       ``(D) any applicable 527 organization.''.
       (b) Definition of Applicable 527 Organization.--Section 301 
     of the Federal Election Campaign Act of 1971 (2 U.S.C. 431) 
     is amended by adding at the end the following new paragraph:
       ``(27) Applicable 527 organization.--For purposes of 
     paragraph (4)(D)--
       ``(A) In general.--The term `applicable 527 organization' 
     means a committee, club, association, or group of persons 
     that--
       ``(i) is an organization described in section 527 of the 
     Internal Revenue Code of 1986, and
       ``(ii) is not described in subparagraph (B).
       ``(B) Excepted organizations.--Subject to subparagraph (D), 
     a committee, club, association, or other group of persons 
     described in this subparagraph is--
       ``(i) an organization described in section 527(i)(5) of the 
     Internal Revenue Code of 1986,
       ``(ii) an organization which is a committee, club, 
     association or other group of persons that is organized, 
     operated, and makes disbursements exclusively for paying 
     expenses described in the last sentence of section 527(e)(2) 
     of the Internal Revenue Code of 1986 or expenses of a 
     newsletter fund described in section 527(g) of such Code, or
       ``(iii) an organization which is a committee, club, 
     association, or other group of persons whose election or 
     nomination activities relate exclusively to--

       ``(I) elections where no candidate for Federal office 
     appears on the ballot, or
       ``(II) one or more of the purposes described in 
     subparagraph (C).

       ``(C) Allowable purposes.--The purposes described in this 
     subparagraph are the following:
       ``(i) Influencing the selection, nomination, election, or 
     appointment of one or more candidates to non-Federal offices.
       ``(ii) Influencing one or more State or local ballot 
     initiatives, State or local referenda, State or local 
     constitutional amendments, State or local bond issues, or 
     other State or local ballot issues.
       ``(iii) Influencing the selection, appointment, nomination, 
     or confirmation of one or more individuals to non-elected 
     offices.
       ``(D) Section 527 organizations making certain 
     disbursements.--A committee, club, association, or other 
     group of persons described in subparagraph (B)(ii) or 
     (B)(iii) shall not be considered to be described in such 
     paragraph for purposes of subparagraph (A)(ii) if it makes 
     disbursements aggregating more than $1000 during any calendar 
     year for any of the following:
       ``(i) A public communication that promotes, supports, 
     attacks, or opposes a clearly identified candidate for 
     Federal office during the 1-year period ending on the date of 
     the general election for the office sought by the clearly 
     identified candidate occurs.
       ``(ii) Any voter drive activity (as defined in section 
     325(d)(1)).''.

     SEC. 3. RULES FOR ALLOCATION OF EXPENSES BETWEEN FEDERAL AND 
                   NON-FEDERAL ACTIVITIES.

       (a) In General.--Title III of the Federal Election Campaign 
     Act of 1971 (2 U.S.C. 431 et seq.) is amended by adding at 
     the end the following:

     ``SEC. 325. ALLOCATION AND FUNDING RULES FOR CERTAIN EXPENSES 
                   RELATING TO FEDERAL AND NON-FEDERAL ACTIVITIES.

       ``(a) In General.--In the case of any disbursements by any 
     separate segregated fund or nonconnected committee for which 
     allocation rules are provided under subsection (b)--
       ``(1) the disbursements shall be allocated between Federal 
     and non-Federal accounts in accordance with this section and 
     regulations prescribed by the Commission, and
       ``(2) in the case of disbursements allocated to non-Federal 
     accounts, may be paid only from a qualified non-Federal 
     account.
       ``(b) Costs to Be Allocated and Allocation Rules.--
     Disbursements by any separate segregated fund or nonconnected 
     committee for any of the following categories of activity 
     shall be allocated as follows:
       ``(1) 100 percent of the expenses for public communications 
     or voter drive activities that refer to one or more clearly 
     identified Federal candidates, but do not refer to any 
     clearly identified non-Federal candidates, shall be paid with 
     funds from a Federal account, without regard to whether the 
     communication refers to a political party.
       ``(2) At least 50 percent of the expenses for public 
     communications and voter drive activities that refer to one 
     or more clearly identified candidates for Federal office and 
     one or more clearly defined non-Federal candidates shall be 
     paid with funds from a Federal account, without regard to 
     whether the communication refers to a political party.
       ``(3) At least 50 percent of the expenses for public 
     communications or voter drive activities that refer to a 
     political party, but do not refer to any clearly identified 
     Federal or non-Federal candidate, shall be paid with funds 
     from a Federal account, except that this paragraph shall not 
     apply to communications or activities that relate exclusively 
     to elections where no candidate for Federal office appears on 
     the ballot.
       ``(4) At least 50 percent of the expenses for public 
     communications or voter drive activities that refer to a 
     political party, and refer to one or more clearly identified 
     non-Federal candidates, but do not refer to any clearly 
     identified Federal candidates, shall be paid with funds from 
     a Federal account, except that this paragraph shall not apply 
     to communications or activities that relate exclusively to 
     elections where no candidate for Federal office appears on 
     the ballot.
       ``(5) At least 50 percent of any administrative expenses, 
     including rent, utilities, office supplies, and salaries not 
     attributable to a clearly identified candidate, shall be paid 
     with funds from a Federal account, except that for a separate 
     segregated fund such expenses may be paid instead by its 
     connected organization.
       ``(6) At least 50 percent of the direct costs of a 
     fundraising program or event, including disbursements for 
     solicitation of funds and for planning and administration of 
     actual fundraising events, where Federal and non-Federal 
     funds are collected through such program or event shall be 
     paid with funds from a Federal account, except that for a 
     separate segregated fund such costs may be paid instead by 
     its connected organization.
       ``(c) Qualified Non-Federal Account.--For purposes of this 
     section--
       ``(1) In general.--The term `qualified non-Federal account' 
     means an account which consists solely of amounts--
       ``(A) that, subject to the limitations of paragraphs (2) 
     and (3), are raised by the separate segregated fund or 
     nonconnected committee only from individuals, and
       ``(B) with respect to which all other requirements of 
     Federal, State, or local law are met.
       ``(2) Limitation on individual donations.--
       ``(A) In general.--A separate segregated fund or 
     nonconnected committee may not accept more than $25,000 in 
     funds for its qualified non-Federal account from any one 
     individual in any calendar year.
       ``(B) Affiliation.--For purposes of this paragraph, all 
     qualified non-Federal accounts of separate segregated funds 
     or nonconnected committees which are directly or indirectly 
     established, financed, maintained, or controlled by the same 
     person or persons shall be treated as one account.
       ``(3) Fundraising limitation.--No donation to a qualified 
     non-Federal account may be solicited, received, directed, 
     transferred, or spent by or in the name of any person 
     described in subsection (a) or (e) of section 323.
       ``(d) Definitions.--For purposes of this section--
       ``(1) Voter drive activity.--The term `voter drive 
     activity' means any of the following activities conducted in 
     connection with an election in which a candidate for Federal 
     office appears on the ballot (regardless of whether a 
     candidate for State or local office also appears on the 
     ballot):
       ``(A) Voter registration activity.
       ``(B) Voter identification.
       ``(C) Get-out-the-vote activity.
       ``(D) Generic campaign activity.

     Such term shall not include any activity described in 
     subparagraph (A) or (B) of section 316(b)(2).
       ``(2) Federal account.--The term `Federal account' means an 
     account which consists solely of contributions subject to the 
     limitations, prohibitions, and reporting requirements of this 
     Act. Nothing in this section or in section 323(b)(2)(B)(iii) 
     shall be construed to infer that a limit other than the limit 
     under section 315(a)(1)(C) applies to contributions to the 
     account.
       ``(3) Nonconnected committee.--The term `nonconnected 
     committee' shall not include a political committee of a 
     political party.''.
       (b) Reporting Requirements.--Section 304(e) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 434(e)) is amended--
       (1) by redesignating paragraphs (3) and (4) as paragraphs 
     (4) and (5); and
       (2) by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) Receipts and disbursements from qualified non-federal 
     accounts.--In addition to any other reporting requirement 
     applicable under this Act, a political committee to which 
     section 325(a) applies shall report all receipts and 
     disbursements from a qualified non-Federal account (as 
     defined in section 325(c)).''.

     SEC. 4. CONSTRUCTION.

       No provision of this Act, or amendment made by this Act, 
     shall be construed--
       (1) as approving, ratifying, or endorsing a regulation 
     promulgated by the Federal Election Commission,
       (2) as establishing, modifying, or otherwise affecting the 
     definition of political organization for purposes of the 
     Internal Revenue Code of 1986, or
       (3) as affecting the determination of whether a group 
     organized under section 501(c) of the Internal Revenue Code 
     of 1986 is a political committee under section 301(4) of the 
     Federal Election Campaign Act of 1971.

     SEC. 5. JUDICIAL REVIEW.

       (a) Special Rules for Actions Brought on Constitutional 
     Grounds.--If any action is brought for declaratory or 
     injunctive relief to challenge the constitutionality of any 
     provision of this Act or any amendment made by this Act, the 
     following rules shall apply:
       (1) The action shall be filed in the United States District 
     Court for the District of Columbia and shall be heard by a 3-
     judge court convened pursuant to section 2284 of title 28, 
     United States Code.
       (2) A copy of the complaint shall be delivered promptly to 
     the Clerk of the House of Representatives and the Secretary 
     of the Senate.

[[Page H1516]]

       (3) A final decision in the action shall be reviewable only 
     by appeal directly to the Supreme Court of the United States. 
     Such appeal shall be taken by the filing of a notice of 
     appeal within 10 days, and the filing of a jurisdictional 
     statement within 30 days, of the entry of the final decision.
       (4) It shall be the duty of the United States District 
     Court for the District of Columbia and the Supreme Court of 
     the United States to advance on the docket and to expedite to 
     the greatest possible extent the disposition of the action 
     and appeal.
       (b) Intervention by Members of Congress.--In any action in 
     which the constitutionality of any provision of this Act or 
     any amendment made by this Act is raised (including but not 
     limited to an action described in subsection (a)), any Member 
     of the House of Representatives (including a Delegate or 
     Resident Commissioner to Congress) or Senate shall have the 
     right to intervene either in support of or opposition to the 
     position of a party to the case regarding the 
     constitutionality of the provision or amendment. To avoid 
     duplication of efforts and reduce the burdens placed on the 
     parties to the action, the court in any such action may make 
     such orders as it considers necessary, including orders to 
     require intervenors taking similar positions to file joint 
     papers or to be represented by a single attorney at oral 
     argument.
       (c) Challenge by Members of Congress.--Any Member of 
     Congress may bring an action, subject to the special rules 
     described in subsection (a), for declaratory or injunctive 
     relief to challenge the constitutionality of any provision of 
     this Act or any amendment made by this Act.
       (d) Applicability.--
       (1) Initial claims.--With respect to any action initially 
     filed on or before December 31, 2006, the provisions of 
     subsection (a) shall apply with respect to each action 
     described in such subsection.
       (2) Subsequent actions.--With respect to any action 
     initially filed after December 31, 2006, the provisions of 
     subsection (a) shall not apply to any action described in 
     such subsection unless the person filing such action elects 
     such provisions to apply to the action.

     SEC. 6. EFFECTIVE DATE.

       The amendments made by this Act shall take effect on the 
     date which is 60 days after the date of the enactment of this 
     Act.

  The SPEAKER pro tempore. The amendment in the nature of a substitute 
printed in the bill, modified by amendment No. 1 for printing in the 
Congressional Record, is adopted.
  The text of the bill, as amended, is as follows:

                                H.R. 513

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

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``527 Reform Act of 2006''.

     SEC. 2. TREATMENT OF SECTION 527 ORGANIZATIONS.

       (a) Definition of Political Committee.--Section 301(4) of 
     the Federal Election Campaign Act of 1971 (2 U.S.C. 431(4)) 
     is amended--
       (1) by striking the period at the end of subparagraph (C) 
     and inserting ``; or''; and
       (2) by adding at the end the following:
       ``(D) any applicable 527 organization.''.
       (b) Definition of Applicable 527 Organization.--Section 301 
     of such Act (2 U.S.C. 431) is amended by adding at the end 
     the following new paragraph:
       ``(27) Applicable 527 organization.--
       ``(A) In general.--For purposes of paragraph (4)(D), the 
     term `applicable 527 organization' means a committee, club, 
     association, or group of persons that--
       ``(i) has given notice to the Secretary of the Treasury 
     under section 527(i) of the Internal Revenue Code of 1986 
     that it is to be treated as an organization described in 
     section 527 of such Code; and
       ``(ii) is not described in subparagraph (B).
       ``(B) Excepted organizations.--A committee, club, 
     association, or other group of persons described in this 
     subparagraph is--
       ``(i) an organization described in section 527(i)(5) of the 
     Internal Revenue Code of 1986;
       ``(ii) an organization which is a committee, club, 
     association or other group of persons that is organized, 
     operated, and makes disbursements exclusively for paying 
     expenses described in the last sentence of section 527(e)(2) 
     of the Internal Revenue Code of 1986 or expenses of a 
     newsletter fund described in section 527(g) of such Code;
       ``(iii) an organization which is a committee, club, 
     association, or other group that consists solely of 
     candidates for State or local office, individuals holding 
     State or local office, or any combination of either, but only 
     if the organization refers only to one or more non-Federal 
     candidates or applicable State or local issues in all of its 
     voter drive activities and does not refer to a Federal 
     candidate or a political party in any of its voter drive 
     activities; or
       ``(iv) an organization described in subparagraph (C).
       ``(C) Applicable organization.--For purposes of 
     subparagraph (B)(iv), an organization described in this 
     subparagraph is a committee, club, association, or other 
     group of persons whose election or nomination activities 
     relate exclusively to--
       ``(i) elections where no candidate for Federal office 
     appears on the ballot; or
       ``(ii) one or more of the following purposes:
       ``(I) Influencing the selection, nomination, election, or 
     appointment of one or more candidates to non-Federal offices.
       ``(II) Influencing one or more applicable State or local 
     issues.
       ``(III) Influencing the selection, appointment, nomination, 
     or confirmation of one or more individuals to non-elected 
     offices.
       ``(D) Exclusivity test.--A committee, club, association, or 
     other group of persons shall not be treated as meeting the 
     exclusivity requirement of subparagraph (C) if it makes 
     disbursements aggregating more than $1,000 for any of the 
     following:
       ``(i) A public communication that promotes, supports, 
     attacks, or opposes a clearly identified candidate for 
     Federal office during the 1-year period ending on the date of 
     the general election for the office sought by the clearly 
     identified candidate (or, if a runoff election is held with 
     respect to such general election, on the date of the runoff 
     election).
       ``(ii) Any voter drive activity during a calendar year, 
     except that no disbursements for any voter drive activity 
     shall be taken into account under this subparagraph if the 
     committee, club, association, or other group of persons 
     during such calendar year--
       ``(I) makes disbursements for voter drive activities with 
     respect to elections in only 1 State and complies with all 
     applicable election laws of that State, including laws 
     related to registration and reporting requirements and 
     contribution limitations;
       ``(II) refers to one or more non-Federal candidates or 
     applicable State or local issues in all of its voter drive 
     activities and does not refer to any Federal candidate or any 
     political party in any of its voter drive activities;
       ``(III) does not have a candidate for Federal office, an 
     individual who holds any Federal office, a national political 
     party, or an agent of any of the foregoing, control or 
     materially participate in the direction of the organization, 
     solicit contributions to the organization (other than funds 
     which are described under clauses (i) and (ii) of section 
     323(e)(1)(B)), or direct disbursements, in whole or in part, 
     by the organization; and
       ``(IV) makes no contributions to Federal candidates.
       ``(E) Certain references to federal candidates not taken 
     into account.--For purposes of subparagraphs (B)(iii) and 
     (D)(ii)(II), a voter drive activity shall not be treated as 
     referring to a clearly identified Federal candidate if the 
     only reference to the candidate in the activity is--
       ``(i) a reference in connection with an election for a non-
     Federal office in which such Federal candidate is also a 
     candidate for such non-Federal office; or
       ``(ii) a reference to the fact that the candidate has 
     endorsed a non-Federal candidate or has taken a position on 
     an applicable State or local issue, including a reference 
     that constitutes the endorsement or position itself.
       ``(F) Certain references to political parties not taken 
     into account.--For purposes of subparagraphs (B)(iii) and 
     (D)(ii)(II), a voter drive activity shall not be treated as 
     referring to a political party if the only reference to the 
     party in the activity is--
       ``(i) a reference for the purpose of identifying a non-
     Federal candidate;
       ``(ii) a reference for the purpose of identifying the 
     entity making the public communication or carrying out the 
     voter drive activity; or
       ``(iii) a reference in a manner or context that does not 
     reflect support for or opposition to a Federal candidate or 
     candidates and does reflect support for or opposition to a 
     State or local candidate or candidates or an applicable State 
     or local issue.
       ``(G) Applicable state or local issue.--For purposes of 
     this paragraph, the term `applicable State or local issue' 
     means any State or local ballot initiative, State or local 
     referendum, State or local constitutional amendment, State or 
     local bond issue, or other State or local ballot issue.''.
       (c) Definition of Voter Drive Activity.--Section 301 of 
     such Act (2 U.S.C. 431), as amended by subsection (b), is 
     further amended by adding at the end the following new 
     paragraph:
       ``(28) Voter drive activity.--The term `voter drive 
     activity' means any of the following activities conducted in 
     connection with an election in which a candidate for Federal 
     office appears on the ballot (regardless of whether a 
     candidate for State or local office also appears on the 
     ballot):
       ``(A) Voter registration activity.
       ``(B) Voter identification.
       ``(C) Get-out-the-vote activity.
       ``(D) Generic campaign activity.
       ``(E) Any public communication related to activities 
     described in subparagraphs (A) through (D).

     Such term shall not include any activity described in 
     subparagraph (A) or (B) of section 316(b)(2).''.

     SEC. 3. RULES FOR ALLOCATION OF EXPENSES BETWEEN FEDERAL AND 
                   NON-FEDERAL ACTIVITIES.

       (a) In General.--Title III of the Federal Election Campaign 
     Act of 1971 (2 U.S.C. 431 et seq.) is amended by adding at 
     the end the following:

     ``SEC. 325. ALLOCATION AND FUNDING RULES FOR CERTAIN EXPENSES 
                   RELATING TO FEDERAL AND NON-FEDERAL ACTIVITIES.

       ``(a) In General.--In the case of any disbursements by any 
     political committee that is a separate segregated fund or 
     nonconnected committee for which allocation rules are 
     provided under subsection (b)--
       ``(1) the disbursements shall be allocated between Federal 
     and non-Federal accounts in accordance with this section and 
     regulations prescribed by the Commission; and
       ``(2) in the case of disbursements allocated to non-Federal 
     accounts, may be paid only from a qualified non-Federal 
     account.

[[Page H1517]]

       ``(b) Costs to Be Allocated and Allocation Rules.--
       ``(1) In general.--Disbursements by any separate segregated 
     fund or nonconnected committee, other than an organization 
     described in section 323(b)(1), for any of the following 
     categories of activity shall be allocated as follows:
       ``(A) 100 percent of the expenses for public communications 
     or voter drive activities that refer to one or more clearly 
     identified Federal candidates, but do not refer to any 
     clearly identified non-Federal candidates, shall be paid with 
     funds from a Federal account, without regard to whether the 
     communication refers to a political party.
       ``(B) At least 50 percent, or a greater percentage if the 
     Commission so determines by regulation, of the expenses for 
     public communications and voter drive activities that refer 
     to one or more clearly identified candidates for Federal 
     office and one or more clearly identified non-Federal 
     candidates shall be paid with funds from a Federal account, 
     without regard to whether the communication refers to a 
     political party.
       ``(C) At least 50 percent, or a greater percentage if the 
     Commission so determines by regulation, of the expenses for 
     public communications or voter drive activities that refer to 
     a political party, but do not refer to any clearly identified 
     Federal or non-Federal candidate, shall be paid with funds 
     from a Federal account, except that this paragraph shall not 
     apply to communications or activities that relate exclusively 
     to elections where no candidate for Federal office appears on 
     the ballot.
       ``(D) At least 50 percent, or a greater percentage if the 
     Commission so determines by regulation, of the expenses for 
     public communications or voter drive activities that refer to 
     a political party and refer to one or more clearly identified 
     non-Federal candidates, but do not refer to any clearly 
     identified Federal candidates, shall be paid with funds from 
     a Federal account, except that this paragraph shall not apply 
     to communications or activities that relate exclusively to 
     elections where no candidate for Federal office appears on 
     the ballot.
       ``(E) Unless otherwise determined by the Commission in its 
     regulations, at least 50 percent of any administrative 
     expenses, including rent, utilities, office supplies, and 
     salaries not attributable to a clearly identified candidate, 
     shall be paid with funds from a Federal account, except that 
     for a separate segregated fund such expenses may be paid 
     instead by its connected organization.
       ``(F) At least 50 percent, or a greater percentage if the 
     Commission so determines by regulation, of the direct costs 
     of a fundraising program or event, including disbursements 
     for solicitation of funds and for planning and administration 
     of actual fundraising events, where Federal and non-Federal 
     funds are collected through such program or event shall be 
     paid with funds from a Federal account, except that for a 
     separate segregated fund such costs may be paid instead by 
     its connected organization. This paragraph shall not apply to 
     any fundraising solicitations or any other activity that 
     constitutes a public communication.
       ``(2) Certain references to federal candidates not taken 
     into account.--For purposes of paragraph (1), a public 
     communication or voter drive activity shall not be treated as 
     referring to a clearly identified Federal candidate if the 
     only reference to the candidate in the communication or 
     activity is--
       ``(A) a reference in connection with an election for a non-
     Federal office in which such Federal candidate is also a 
     candidate for such non-Federal office; or
       ``(B) a reference to the fact that the candidate has 
     endorsed a non-Federal candidate or has taken a position on 
     an applicable State or local issue (as defined in section 
     301(27)(G)), including a reference that constitutes the 
     endorsement or position itself.
       ``(3) Certain references to political parties not taken 
     into account.--For purposes of paragraph (1), a public 
     communication or voter drive activity shall not be treated as 
     referring to a political party if the only reference to the 
     party in the communication or activity is--
       ``(A) a reference for the purpose of identifying a non-
     Federal candidate;
       ``(B) a reference for the purpose of identifying the entity 
     making the public communication or carrying out the voter 
     drive activity; or
       ``(C) a reference in a manner or context that does not 
     reflect support for or opposition to a Federal candidate or 
     candidates and does reflect support for or opposition to a 
     State or local candidate or candidates or an applicable State 
     or local issue.
       ``(c) Qualified Non-Federal Account.--
       ``(1) In general.--For purposes of this section, the term 
     `qualified non-Federal account' means an account which 
     consists solely of amounts--
       ``(A) that, subject to the limitations of paragraphs (2) 
     and (3), are raised by the separate segregated fund or 
     nonconnected committee only from individuals, and
       ``(B) with respect to which all requirements of Federal, 
     State, or local law (including any law relating to 
     contribution limits) are met.
       ``(2) Limitation on individual donations.--
       ``(A) In general.--A separate segregated fund or 
     nonconnected committee may not accept more than $25,000 in 
     funds for its qualified non-Federal account from any one 
     individual in any calendar year.
       ``(B) Affiliation.--For purposes of this paragraph, all 
     qualified non-Federal accounts of separate segregated funds 
     or nonconnected committees which are directly or indirectly 
     established, financed, maintained, or controlled by the same 
     person or persons shall be treated as one account.
       ``(3) Fundraising limitation.--
       ``(A) In general.--No donation to a qualified non-Federal 
     account may be solicited, received, directed, transferred, or 
     spent by or in the name of any person described in subsection 
     (a) or (e) of section 323.
       ``(B) Funds not treated as subject to act.--Except as 
     provided in subsection (a)(2) and this subsection, any funds 
     raised for a qualified non-Federal account in accordance with 
     the requirements of this section shall not be considered 
     funds subject to the limitations, prohibitions, and reporting 
     requirements of this Act for any purpose (including for 
     purposes of subsection (a) or (e) of section 323 or 
     subsection (d)(1) of this section).
       ``(d) Definitions.--
       ``(1) Federal account.--The term `Federal account' means an 
     account which consists solely of contributions subject to the 
     limitations, prohibitions, and reporting requirements of this 
     Act. Nothing in this section or in section 323(b)(2)(B)(iii) 
     shall be construed to infer that a limit other than the limit 
     under section 315(a)(1)(C) applies to contributions to the 
     account.
       ``(2) Nonconnected committee.--The term `nonconnected 
     committee' shall not include a political committee of a 
     political party.
       ``(3) Voter drive activity.--The term `voter drive 
     activity' has the meaning given such term in section 
     301(28).''.
       (b) Reporting Requirements.--Section 304(e) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 434(e)) is amended--
       (1) by redesignating paragraphs (3) and (4) as paragraphs 
     (4) and (5); and
       (2) by inserting after paragraph (2) the following new 
     paragraph:
       ``(3) Receipts and disbursements from qualified non-federal 
     accounts.--In addition to any other reporting requirement 
     applicable under this Act, a political committee to which 
     section 325(a) applies shall report all receipts and 
     disbursements from a qualified non-Federal account (as 
     defined in section 325(c)).''.

     SEC. 4. REPEAL OF LIMIT ON AMOUNT OF PARTY EXPENDITURES ON 
                   BEHALF OF CANDIDATES IN GENERAL ELECTIONS.

       (a) Repeal of Limit.--Section 315(d) of the Federal 
     Election Campaign Act of 1971 (2 U.S.C. 441a(d)) is amended--
       (1) in paragraph (1)--
       (A) by striking ``(1) Notwithstanding any other provision 
     of law with respect to limitations on expenditures or 
     limitations on contributions, the national committee'' and 
     inserting ``Notwithstanding any other provision of law with 
     respect to limitations on amounts of expenditures or 
     contributions, a national committee'',
       (B) by striking ``the general'' and inserting ``any'', and
       (C) by striking ``Federal office, subject to the 
     limitations contained in paragraphs (2), (3), and (4) of this 
     subsection'' and inserting ``Federal office in any amount''; 
     and
       (2) by striking paragraphs (2), (3), and (4).
       (b) Conforming Amendments.--
       (1) Indexing.--Section 315(c) of such Act (2 U.S.C. 
     441a(c)) is amended--
       (A) in paragraph (1)(B)(i), by striking ``(d),''; and
       (B) in paragraph (2)(B)(i), by striking ``subsections (b) 
     and (d)'' and inserting ``subsection (b)''.
       (2) Increase in limits for senate candidates facing wealthy 
     opponents.--Section 315(i) of such Act (2 U.S.C. 441a(i)(1)) 
     is amended--
       (A) in paragraph (1)(C)(iii)--

       (i) by adding ``and'' at the end of subclause (I),
       (ii) in subclause (II), by striking ``; and'' and inserting 
     a period, and
       (iii) by striking subclause (III);

       (B) in paragraph (2)(A) in the matter preceding clause (i), 
     by striking ``, and a party committee shall not make any 
     expenditure,'';
       (C) in paragraph (2)(A)(ii), by striking ``and party 
     expenditures previously made''; and
       (D) in paragraph (2)(B), by striking ``and a party shall 
     not make any expenditure''.
       (3) Increase in limits for house candidates facing wealthy 
     opponents.--Section 315A(a) of such Act (2 U.S.C. 441a--1(a)) 
     is amended--
       (A) in paragraph (1)--

       (i) by adding `'and'' at the end of subparagraph (A),
       (ii) in subparagraph (B), by striking ``; and'' and 
     inserting a period, and
       (iii) by striking subparagraph (C);

       (B) in paragraph (3)(A) in the matter preceding clause (i), 
     by striking ``, and a party committee shall not make any 
     expenditure,'';
       (C) in paragraph (3)(A)(ii), by striking ``and party 
     expenditures previously made''; and

       (D) in paragraph (3)(B), by striking ``and a party shall 
     not make any expenditure.''

     SEC. 5. CONSTRUCTION.

       No provision of this Act, or amendment made by this Act, 
     shall be construed--
       (1) as approving, ratifying, or endorsing a regulation 
     promulgated by the Federal Election Commission;
       (2) as establishing, modifying, or otherwise affecting the 
     definition of political organization for purposes of the 
     Internal Revenue Code of 1986; or
       (3) as affecting the determination of whether a group 
     organized under section 501(c) of the Internal Revenue Code 
     of 1986 is a political committee under section 301(4) of the 
     Federal Election Campaign Act of 1971.

     SEC. 6. JUDICIAL REVIEW.

       (a) Special Rules for Actions Brought on Constitutional 
     Grounds.--If any action is brought for declaratory or 
     injunctive relief to challenge the constitutionality of any 
     provision of this Act or any amendment made by this Act, the 
     following rules shall apply:
       (1) The action shall be filed in the United States District 
     Court for the District of Columbia and shall be heard by a 3-
     judge court convened pursuant to section 2284 of title 28, 
     United States Code.

[[Page H1518]]

       (2) A copy of the complaint shall be delivered promptly to 
     the Clerk of the House of Representatives and the Secretary 
     of the Senate.
       (3) A final decision in the action shall be reviewable only 
     by appeal directly to the Supreme Court of the United States. 
     Such appeal shall be taken by the filing of a notice of 
     appeal within 10 days, and the filing of a jurisdictional 
     statement within 30 days, of the entry of the final decision.
       (4) It shall be the duty of the United States District 
     Court for the District of Columbia and the Supreme Court of 
     the United States to advance on the docket and to expedite to 
     the greatest possible extent the disposition of the action 
     and appeal.
       (b) Intervention by Members of Congress.--In any action in 
     which the constitutionality of any provision of this Act or 
     any amendment made by this Act is raised (including but not 
     limited to an action described in subsection (a)), any Member 
     of the House of Representatives (including a Delegate or 
     Resident Commissioner to Congress) or Senate shall have the 
     right to intervene either in support of or opposition to the 
     position of a party to the case regarding the 
     constitutionality of the provision or amendment. To avoid 
     duplication of efforts and reduce the burdens placed on the 
     parties to the action, the court in any such action may make 
     such orders as it considers necessary, including orders to 
     require intervenors taking similar positions to file joint 
     papers or to be represented by a single attorney at oral 
     argument.
       (c) Challenge by Members of Congress.--Any Member of 
     Congress may bring an action, subject to the special rules 
     described in subsection (a), for declaratory or injunctive 
     relief to challenge the constitutionality of any provision of 
     this Act or any amendment made by this Act.
       (d) Applicability.--
       (1) Initial claims.--With respect to any action initially 
     filed on or before December 31, 2008, the provisions of 
     subsection (a) shall apply with respect to each action 
     described in such subsection.
       (2) Subsequent actions.--With respect to any action 
     initially filed after December 31, 2008, the provisions of 
     subsection (a) shall not apply to any action described in 
     such subsection unless the person filing such action elects 
     such provisions to apply to the action.

     SEC. 7. EFFECTIVE DATE.

       The amendments made by this Act shall take effect on the 
     date of the enactment of this Act.

  The SPEAKER pro tempore. The gentleman from Michigan (Mr. Ehlers) and 
the gentlewoman from California (Ms. Millender-McDonald) each will 
control 30 minutes.
  The Chair recognizes the gentleman from Michigan.
  Mr. EHLERS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I rise in support of H.R. 513, the 527 Reform Act of 
2006. Today we have an opportunity to right one of the wrongs of the 
Bipartisan Campaign Reform Act of 2002. All my friends on the other 
side of the aisle who voted for BCRA because they believed we needed to 
get soft money out of politics must support this legislation today 
because it does indeed get the soft money out of politics.
  Just a word of explanation. I have used the term ``BCRA.'' That is 
the acronym for Bipartisan Campaign Reform Act, which we worked on 
very, very hard a few years ago to get the soft money out of politics. 
What do we mean by soft money? That is money that is unregulated, both 
in quantity and disclosure to the Federal Election Commission.
  While BCRA was supposed to curtail the influence of soft money in 
Federal elections, it did not achieve that goal. In the 2004 election 
cycle, the first conducted under the rules imposed by BCRA, over a half 
a billion dollars in soft money was spent to influence the outcome. 
Just four individuals alone spent over $73 million total.

                              {time}  1700

  While BCRA was supposed to reduce the influence of special interests, 
it actually empowered these ideologically driven outside groups. The 
power these outside groups gained came at the direct expense of 
political parties which saw many of the activities they had 
traditionally performed limited by BCRA, and thence taken over by these 
new organizations, the 527s. Again, let me explain, the term 527 refers 
to the section of IRS Code which governs their operation, and we simply 
use that designation for them.
  We now have a system where soft money continues to thrive. Our 
political parties, especially those at the State and local level, are 
increasingly unable to carry out core functions such as voter 
registration activities. We now have a system where the influence of 
billionaires is greatly enhanced. In some cases, representatives of 
527s have made boasts about taking over the party. For example, Eli 
Pariser of MoveOn.org sent an e-mail to supporters after the 2004 
elections stating, ``Now it's our party. We bought it, we own it, and 
we're going to take it back.'' What more evidence do we need of the 
corruption that has appeared here? This does not represent progress. 
Today we have an opportunity to reverse this negative trend, and this 
bill will help restore some balance to our system.
  H.R. 513 would require 527 groups spending money to influence Federal 
elections to register as Federal political committees and comply with 
Federal campaign finance laws, including limits on the contributions 
they receive. Thus, 527 groups would be subject to the same 
contribution limits and source restrictions that are applicable to 
Federal political action committees. There would be no more $23 million 
soft money contributions allowed from a lone, extremely wealthy donor. 
When this bill passes, individuals will be limited to $30,000. In other 
words, soft unregulated money will be replaced by hard regulated money 
which will be reported to the Federal Elections Commission.
  Those 527s that engage exclusively in State or local elections or in 
ballot initiatives would not be restricted by this bill. However, if 
they decide to engage in Federal election activity such as making 
public communications that promote, support, attack, or oppose a 
Federal candidate during the year prior to a Federal election, or 
conduct voter drive activities in connection with an election in which 
a Federal candidate appears on the ballot, they will be restricted by 
this bill. In other words, State and local activities would be free to 
continue as they have in the past. Those dealing with Federal 
candidates or issues will be restricted by the bill, and will have to 
use hard money.
  H.R. 513 would also impose new allocation rules on 527 groups 
regarding expenses for Federal and non-Federal activities. For 
instance, 100 percent of expenses for public communications or voter 
drive activities that refer only to a Federal campaign would have to be 
paid for with hard money. If both Federal and non-Federal candidates 
were mentioned, then at least 50 percent of such expenses would have to 
be paid for with hard money. In addition, under H.R. 513, at least 50 
percent of a 527 group's administrative overhead expenses would have to 
be paid for with hard money.
  This bill, H.R. 513 has been endorsed by the reform community and 
rightfully so. Common Cause, Democracy 21, the Campaign Legal Center, 
and other like-minded reform groups have sent several letters to House 
Members asking them to support H.R. 513. In a letter sent just this 
week, these groups argued that H.R. 513 is needed in order to ``close 
the loophole that allowed both Democrat and Republican 527 groups to 
spend hundreds of millions of dollars in unlimited soft money to 
influence the 2004 presidential and congressional elections.''
  Mr. Speaker, I will be including a copy of the letter for the Record.
  Mr. Speaker, I know many of my friends on the other side of the aisle 
are usually interested in what The New York Times has to say on these 
issues, so I would like to include some editorials from The Times as 
well; and an editorial from today's Washington Post also calls on the 
House to pass this bill.
  Mr. Speaker, I will include these editorials in the Record.
  Mr. Speaker, I expect many of my friends on the other side of the 
aisle would be arguing that BCRA should not be applied to 527s because 
they are independent organizations and have no connection to 
officeholders. The claim will be that we have already severed the link 
between large donors and Federal officeholders. This is nonsense; this 
is bunk. The 527s that have soaked up all the soft money were, in many 
cases, set up and staffed by former party operatives and congressional 
staffers. In some cases, Federal officeholders attend fundraising 
events for these 527s in an attempt to grant an official stamp of 
approval and signal to their donors where soft money donations should 
be steered. I do not intend to name names, but I will include in the 
Record a number of articles that describe how 527s have been set up by 
people who used to work for Federal officeholders or national parties.
  The soft money shell game we spawned 4 years ago is clearly 
demonstrated in these articles. They demonstrate that these so-called 
``independent'' 527s are, in many cases, independent in name only. In 
reality, they

[[Page H1519]]

have been set up by people who used to work for our parties. They left 
to organize 527s to escape the restrictions BCRA placed on the parties. 
Had their candidate for the presidency won, many of them would be 
working in the administration. Would not they feel indebted to the 
millionaire donors who helped put them in office? Is not that what BCRA 
was supposed to stop? Let us stop pretending that these 527s are 
anything other than campaign organizations established to influence our 
Federal elections.
  This is not the first time Congress has dealt with the 527 issue. In 
fact, some time ago, 6 years ago to be exact, Roll Call reported on the 
debate that was going on at the time and included a quote from a 
powerful congressional leader of the time. In 2000, 527s did not have 
any disclosure requirements, and a bill was pending to require them to 
disclose their donors. At an event held to rally support for the bill, 
this leader was quoted as saying, ``Now more than ever, we need to 
assure the American people that we are not willing to let our system of 
government be put in jeopardy by wealthy special interests, unregulated 
foreign money, and, most importantly, a system of secrecy. It is time 
for disclosure.'' The leader who said these words was Minority Leader 
Richard Gephardt. We passed a disclosure bill then, but the problem of 
wealthy special interest money jeopardizing our system of government 
has only gotten worse in the ensuing 6 years, and I suspect the 
minority leader would say the same thing today.
  Not extending the contributions restrictions in BCRA to all 527s was 
a terrible mistake that we are today seeking to rectify. Today we can 
restore some sanity to our system. The status quo allowing 527 groups 
to raise unlimited amounts of soft money while our parties continue to 
lose power and influence is unacceptable. It threatens the health of 
our democracy.
  We must subject 527s to the same regulatory restrictions that are 
applicable to all other parties, candidates and committees. I urge my 
colleagues to support H.R. 513.
  Mr. Speaker, I reserve the balance of my time.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield myself as much time as I 
may consume.
  Mr. Speaker, I rise in opposition to H.R. 513, the so-called 527 
Reform Act of 2005 and the restriction that they are placing on the 
first amendment rights of Americans. 527s are named after a section of 
the Internal Revenue Code that specifies certain political 
organizations as tax exempt for tax exempt purposes under the Federal 
law.
  Added to the Tax Code in 1975, 527 organizations have been legally 
recognized as operating entities for over 30 years. The Federal 
Election Commission has recently implemented additional regulations of 
these groups, which are subject to rigorous Federal reporting and 
disclosure requirements. Anyone with a computer can go online and see 
that millionaire Bob Perry gave $4.5 million to bankroll the Swift Boat 
Veterans.
  How do I know this? 527 organizations regularly submit detailed 
financial information to the IRS. They have to disclose where they get 
their money and how they get it. In fact, just last week, a Federal 
court remanded part of a case back to the FEC to present a more 
reasoned explanation for its decision that 527 organizations are more 
effectively regulated through case-by-case adjudication rather than 
general law.
  I believe that FEC should be given a chance to review this matter 
before further legislation is introduced in this House. The Senate is 
providing leadership in this area. They set out to do what they wanted 
to do and that was lobby reform, unlike this House, which is just 
bringing up this type of legislation to circumvent their lobbying 
reform bill that they do not have, and downplaying groups that had more 
voters than ever before in history outside demonstrating their 
democracy and getting the vote out. This is what the BCRA bill was all 
about.
  I voted for BCRA because it would sever the connection between 
Members of Congress in raising non-Federal funds, so-called soft money, 
and to ensure that there were limits on what we did in terms of money. 
BCRA was necessary to cut the perceived corruption link between Members 
of Congress, the formation and adoption of Federal policy and soft 
money.
  However, BCRA was not passed to impede legitimate voter registration 
and Get Out the Vote by those 527 community groups which did just that, 
but this bill impedes that democratic process. It impedes the 527 
organizations.
  This bill is not needed, Mr. Speaker. It is very interesting 
listening to the majority speak in favor of campaign finance reform 
after they did everything possible to stonewall the Bipartisan Campaign 
Reform Act of 2002. Also interesting is watching the Republicans avoid 
any discussion about the activities of 501(c)6s and those organizations 
that have no disclosure requirements, and yet are running television 
ads designed to directly reelect a Senator from Pennsylvania. Unfair 
and impartial regulating 527s is a step in the wrong direction for 
political speech.
  Mr. Speaker, I would like to put in the Record a statement by the 
National Review magazine, which is a conservative magazine, and the 
National Review states, One of the biggest myths about this bill is 
that it would level the playing field ending the ability of the wealthy 
to fund propaganda. This is completely false. Wealthy individuals will 
still be free to say whatever they want and whenever they want. This 
proposal would end only the ability of individuals of lesser means to 
pool their money to independently speak out on issues and speak and 
criticize Members of Congress.
  Mr. Speaker, I will include this statement in the Record as follows:

       Advocates of this bill have yet to identify the problem 
     they hope to correct with this misguided proposal. 527s wield 
     no corruptive influence over parties or candidates, which is 
     the only constitutional justification for restricting free 
     expression.
       One of the biggest myths about this bill is that it would 
     ``level the playing field,'' ending the ability of the 
     wealthy to fund ``propaganda.'' This is completely false. 
     Wealthy individuals would still be free to say whatever they 
     want whenever they want. The proposal would end only the 
     ability of individuals of lesser means to pool their money to 
     independently speak out on issues.
       America needs the First Amendment and the ability of 
     individual citizens to form groups precisely for speech that 
     is controversial. To suppress views of those we dislike will 
     inevitably risk suppression of our own.
       We who oppose such a proposal want to continue to freely 
     debate our ideas in the public arena. We want Americans to 
     hear all sides--and to decide for themselves who's right.
       When you were sworn into office, you took an oath to 
     ``support this Constitution.'' We ask you to faithfully 
     uphold that oath by rejecting H.R. 513, S. 1053, and any 
     other bill that restricts political free speech.
           Sincerely,
         Pat Toomey, President, Club for Growth; John Berthoud, 
           President, National Taxpayers Union; Thomas A. Schatz, 
           President, Council for Citizens Against Government 
           Waste; David Keene, Chairman, American Conservative 
           Union; Grover Norquist, President, Americans for Tax 
           Reform; Paul M. Weyrich, National Chairman, Coalitions 
           for America; Matt Kibbe, CEO and President, Freedom 
           Works; James Bopp, Jr., General Counsel, James Madison 
           Center for Free Speech; Bradley A. Smith, Professor of 
           Law, Capital University Law School, and former 
           Chairman, Federal Election Commission; Fred Smith, 
           President, Competitive Enterprise Institute.

  Mr. Speaker, unfairly regulating 527s is a step in the wrong 
direction for political speech. I believe this legislation will have a 
negative impact on the voter participation bill silencing segments of 
the population that we need to hear from. Of particular concern is that 
the fundamental rights and the needs of all Americans including the 
voices of women, the elderly, and the poor not be left out of the 
political dialogue just because of the perceived notion that a few 
millionaires are funding all 527s.
  In fact, thousands of Americans gave to 527s through small donations 
of $25, $50 and the like because they believe, Mr. Speaker, in the 
message of 527 organizations.

                              {time}  1715

  Through the first amendment, Americans are playing an ever increasing 
role in holding public officials accountable for their actions, through 
the debate of public policy, and the shaping of this American 
democracy. Their voices should not be silenced.
  In fact, I would like to put in the Record again the statement by 
Assistant U.S. Attorney General Alice S. Fisher when she stated upon 
the plea

[[Page H1520]]

agreement of Mr. Rudy of his crimes involving illegal favors and 
lobbying activities which lasted from 1997 to 2004, and she says, ``The 
American public loses when officials and lobbyists conspire to buy and 
sell influence in such a corrupt and brazen manner. By his admission in 
open court today, Mr. Rudy paints a picture of Washington which the 
American public and law enforcement will simply not tolerate.''
  The American public, Mr. Speaker, will not tolerate what is about to 
happen here with this elimination of 527 organizations, transferring 
them into 501(c)s, not allowing them to work independently of Members 
of Congress and having to deal with any congressional campaign 
committees.
  In fact, this bill sharply curtails the ability of individuals and 
groups to associate in the pursuit of political and policy goals, and I 
will say to you, Mr. Speaker, that the unjust shade of Federal policy 
holders, which are us, the Members of Congress, this bill will allow 
the public to not criticize or even ask for accountability because they 
want to outlaw those groups who engage in the type of public speech, 
the public speech that might criticize us or ask for accountability.
  This is what they are trying to muffle. They are trying to muffle the 
voices of the American people who spoke through 527s. They are 
independent groups. The majority should not be in the business of 
legislating for partisan gain at the expense of the American people.
  I will vote in opposition of this bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. EHLERS. Mr. Speaker, it is my pleasure to yield 4\1/2\ minutes to 
the gentleman from California (Mr. Doolittle).
  Mr. DOOLITTLE. Mr. Speaker, legislating for partisan gain is all that 
campaign finance regulation has ever been about. Who are we kidding?
  Let us go back to 1974. Watergate, Republicans are under heavy fire. 
Democrats took advantage of that, demanded reform, and one of their 
reforms was the Federal Election Commission Act amendments. Those 
amendments were quite far-reaching, and many of them became the law, 
and when it went to the Supreme Court, the Court finally struck out 
many of them. What was left was the campaign finance law until we 
passed BCRA in 2002.
  It is interesting, though, to talk about that because eventually the 
Republicans made up for their disadvantage, and actually the 
Republicans were the leaders with soft money in 2002. This is very 
upsetting to the Democrats, who developed votes off soft money. It was 
a wonderful tool they could take advantage of, and they were a little 
behind. So they came up with BCRA in 2002. BCRA, of course, was going 
to take the money out of politics.
  Now, going back to 1974 for a minute, let us remember that President 
Nixon was much criticized by the Democrats when he took a campaign 
contribution from one wealthy individual of $2 million. Fast forward to 
2004, after BCRA is passed, and at that point, having taken the big 
money out of politics, you will note with interest that one man, George 
Soros, gave $27 million to efforts to elect John Kerry President of the 
United States. So we went from 1974 with $2 million to Richard Nixon to 
2004 to $27 million to John Kerry. I do not think we got the money out 
of politics. We just sort of reshuffled the deck chairs to the partisan 
advantage of the Democrats.
  We are charged with partisan advantage today in trying at least to 
give full effect to the Democrats' several years ago stated intent, 
which was to take the big money out of politics and put 527s within the 
rule that applies to donations to political parties. I do not think 
that is unreasonable.
  I have got to tell you, as someone who is obviously a participant but 
also as an observer of the political process, what advantage does it 
serve to move political speech farther and farther away from the 
candidate? Third party groups, whether they are 527, 501(c)(4)s, 
whatever, do not have the same vested interest in currying favor with 
the public. There is no sense of self-restraint whatsoever. Therefore, 
the more we move speech away from the candidate into somebody else 
doing the speaking, the less accountable your campaigns become and the 
more negative they become.
  I am constantly fascinated how the left uses the negativity of 
campaigns as justification for yet further campaign regulation when, in 
fact, their regulations are creating the very negativity they claim to 
oppose.
  This bill is a reasoned bill, it is a balanced bill, and it is one 
that we should adopt. Will it eliminate the problems? Of course it will 
not because we have the monstrosity of Federal regulation of political 
speech, something the first amendment to the United States Constitution 
expressly would seem to prohibit. It certainly seems clear to me when 
it says in the first amendment Congress shall make no law abridging the 
freedom of speech, and yet marvelously the Supreme Court or at least a 
majority of it managed to find that these provisions did not violate 
the first amendment.
  So my point is we have got to deregulate political speech and quit 
tinkering and turning about here and a dial here and trying to get 
partisan advantage won over the other. Wipe this whole monstrous system 
out, give full effect to the first amendment, repeal all the limits and 
have full and timely disclosure. That is the solution long term. In the 
meantime, short term today, please support this legislation, recognize 
there is great language about coordination that promotes 
responsibility, accountability and allows parties to help their 
candidates rather than running an independent expenditure.
  I urge support for this bill.
  Ms. MILLENDER-McDONALD. Mr. Speaker, contrary to the last speaker, he 
has a bill that wants to repeal all hard money limits, and this is what 
this bill is all about, the flow of unregulated amounts of money. This 
is what the American people do not want, Mr. Speaker.
  Mr. Speaker, I yield 5 minutes to the gentlewoman from California 
(Ms. Zoe Lofgren).
  Ms. ZOE LOFGREN of California. Mr. Speaker, yesterday former majority 
leader Tom DeLay announced that he is resigning from the House. His 
former aides, Michael Scanlon and Tony Rudy, have pled guilty to crimes 
for their involvement in the Jack Abramoff corruption affair, and other 
aides to Mr. DeLay and even other current Members of this body remain 
under investigation.
  Last November, Republican Congressman Duke Cunningham resigned from 
Congress for taking over $2 million in bribes from a defense 
contractor. He is now serving an 8-year prison sentence for his crimes.
  The House Ethics Committee is broken and has done no work in the past 
15 months. The committee managed to have its first meeting of the 109th 
Congress last week. On Sunday, The Washington Post said, ``The panel's 
inactivity in the face of scandal is itself scandalous.''
  Today's bill is characterized as important campaign finance reform by 
the House Republicans. The question is, what effect would this bill 
have on the countless scandals that are currently engulfing Washington? 
The answer is nothing.
  This bill does nothing to address those very serious charges of 
corruption. It would do nothing to prevent another Jack Abramoff or 
Duke Cunningham scandal.
  Further, in addition to doing nothing, the bill actually makes it 
easier for scandals to occur by opening up the flood gates and removing 
all limits on State and national party committee spending in the 
Federal races.
  Since this bill does nothing to reverse the Republican culture of 
corruption, let us look at this bill on the merits to see what it 
actually does.
  What this proposal would do is curtail the free speech rights of 
millions of Americans. The bill would limit the ability of average 
citizens to band together and speak out about issues, both during and 
beyond election. It limits participation in the electoral process.
  In 2004, 527 organizations helped to educate and register voters 
across the country. Now in 2002, the Shays-Meehan-McCain-Feingold bill 
actually was real reform with a clear purpose. It took Members of 
Congress out of the business of asking lobbyists and special interests 
for large, unregulated donations.
  527 organizations, however, are not made up of elected officials. In 
fact, 527s are barred from coordinating with

[[Page H1521]]

office holders, candidates or public officials. By law, these groups 
are independent, and I am not aware of any allegations that there was 
any illegal coordination between 527s and political parties in 2004. If 
there is, I would urge people with that knowledge to go to the Attorney 
General or to the FEC and report on this conduct. If there is some, 
there are mechanisms for enforcement, but the remedy to a nonproblem in 
that area is not to shut down free speech.
  In fact, in Buckley v. Valeo, the Supreme Court upheld limitations on 
contributions as appropriate legislative tools to guard against the 
reality or appearance of improper influence stemming from candidates' 
dependence on large campaign contributions. Buckley also invalidated 
limitations on independent expenditures, on candidate expenditures from 
personal funds, and on overall campaign expenditures. The Court ruled 
that these provisions placed direct and substantial restrictions on the 
free speech rights guaranteed in the first amendment.
  This bill directly contradicts the Buckley ruling. It violates the 
first amendment and will not withstand scrutiny by the Court.
  Why are we considering this bill today? I suspect this is a last 
ditch effort for Republicans to keep their hold on power. They have 
read the polls. They know that most Americans are going to support 
Democrats this November, and the Republicans are losing on issue after 
issue. So they are going to try and change the rules which will keep 
them in power against the wishes of a majority of Americans.
  Let me finish by reviewing the ethics rules that this Congress has 
passed this year. At the beginning of the year, shortly after Jack 
Abramoff pled guilty, House Republicans boldly pushed through their 
reform plan for Congress. What did their plan to crack down on ethics 
do? It banned former Members from lobbying in the House gym and on the 
House floor. So America, you can rest easy knowing that at least the 
cesspool of corruption at the Stairmaster is no more.
  Today's bill is really a travesty. It is a joke. The country really 
should be embarrassed by the efforts this Congress is making, by the 
corruption that has been shown and I fear the corruption that is yet to 
be exposed in this body.
  Mr. EHLERS. Mr. Speaker, I am pleased to yield 2 minutes to the 
gentlewoman from Florida (Ms. Ginny Brown-Waite).
  Ms. GINNY BROWN-WAITE of Florida. Mr. Speaker, I thank the gentleman 
very much.
  If this bill becomes law, let us speculate about exactly what will 
happen. What would elections and politics be like if the Federal 
Election Commission regulated 527s? Let us see. There might be some 
honesty. For example, candidates and elected officials would not be 
able to rely on partisan political groups like moveon.org to do their 
dirty work.
  Let us see, they might be a lot cleaner because billions of dollars 
in soft money contributions would stop, and so would the false and 
misleading message campaigns that take place in various districts 
almost daily.
  One of my colleagues said if they are aware of any misuse of the 527s 
in the political area, let me just state but one. The ACORN Group, 
which is a political front for a liberal 527 group called America 
Votes, has also been implicated in political escapades. A former ACORN 
worker admitted to deliberately throwing out Republican registration 
forms and paying gatherers only to collect Democrat registration forms 
in 2004. Actually, in at least one State this is being investigated.

                              {time}  1730

  Is this fairness? What about those who chose not to register in the 
Democrat Party? They may have been Republican; they may have decided to 
be an independent. Do they not have a right to have their registrations 
turned into the local election commissioner?
  You know, allowing groups to hide behind faulty, arcane and outdated 
FEC and IRS rules is not an option. Congress must move forward and 
reform the laws that allow these 527s to spew their lies and fraudulent 
tactics on the American people. Regularly in my district, I get the 527 
calls. My constituents are wise to the fact that this is an unregulated 
entity.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield 3\1/2\ minutes to the 
gentleman from Illinois (Mr. Emanuel).
  Mr. EMANUEL. Mr. Speaker, in the wake of the Jack Abramoff scandal, 
we have seen multiple indictments, Members of Congress resigning under 
a cloud of scandal, congressional approval at an historic low, and a 
public demand for reform. You would think that the Republican 
leadership would want to get these scandals behind them, but it is 
clear they do not.
  What is the first stage of grief? Denial and isolation. So here we 
are today discussing a bill that doesn't do anything to address the 
problems of the scandals facing this Congress, this institution, which 
require an institutional solution to an institutional problem.
  Nope, this bill doesn't do anything to stop the pay-to-play policies 
of the party in power. Nope, it doesn't. Doesn't do anything to shut 
down the K Street Project, rewarding lobbyists who show party loyalty, 
or to slow the revolving door. Nope, it doesn't do that.
  Many of you will recall our former colleague, Mr. Tauzin, who 
negotiated a million dollar lobbying job with the pharmaceutical 
industry at the same time that he was rewriting the Medicare 
prescription drug bill. This legislation doesn't affect that.
  Now, take a hypothetical for a moment. What if a Member just 
resigned, middle of a term, and was thinking of working for companies 
and sitting on boards. This legislation doesn't change what would 
happen. It happened when Mr. Tauzin was out here on the floor. And if 
you had a hypothetical, the Member resigned, maybe just a hypothetical, 
2 months left on his tenure here, this legislation doesn't affect who 
he meets with, who he talks with, how he negotiates and how he votes 
while he is negotiating.
  Why, to do that, you would have to have a desire for reform, and I 
wouldn't want to impose on the majority party in any way. All the 
while, while they are voting on this legislation, they are negotiating 
jobs and they have no responsibility to report to the public of their 
conduct. It is just business as usual here in Washington.
  And then what are they trying to do; take the legislation regarding 
the 527s, and my colleagues on the other side voted the McCain-Feingold 
campaign finance reform of past years. Well, that reform leveled the 
playing field for both parties. This legislation does not intend to do 
that. This legislation intends to do a very partisan thing to the 
campaign finance laws affecting 527s.
  Now, I introduced legislation to affect 501(c)6s. Right now, in the 
State of Pennsylvania, one of those organizations is actually running 
ads. I say, you want the same rhetoric, you want 527s to report, well, 
I suggest 501(c)6s report. That amendment was not allowed. Why? Because 
it would actually have leveled the playing field. It would have applied 
to both parties, not one party. So in the name of reform, once again, 
we have partisan tactics.
  Now, all the while, you are going to go home and wonder why the 
American people have such low esteem for the Congress. It is quite 
obvious why they have such low esteem: College costs at a record high, 
38 percent and going up; health care costs are up 58 percent, $3,600 in 
4 years; energy costs are up 70 percent; medium incomes are down. All 
that Congress hasn't paid attention to.
  So as we have scandals swirling around this institution, Members 
resigning, Members pleading guilty, you once again go whistling past 
the graveyard on the chance to do real reform and play partisan 
politics. I do not know what tune you are singing right now, but you 
will come to know that tune this November.
  Mr. EHLERS. Mr. Speaker, I am pleased to yield 3\3/4\ minutes to my 
colleague from New York (Mr. Reynolds).
  (Mr. REYNOLDS asked and was given permission to revise and extend his 
remarks.)
  Mr. REYNOLDS. Mr. Speaker, I find it such an ironic message that my 
colleague from Illinois chose about his remarks. As he talks about so 
many problems in Washington, he failed to mention any on his side of 
the aisle. We kind of nicknamed that the culture of hypocrisy. It is a 
hypocrisy of attack the Republicans, slash and burn, no debate, no real 
issues, just the party

[[Page H1522]]

of ``no'' from the Democrats on the other side of the aisle.
  When you look at some of the discussions he talked about, with 
lobbying reform and others, he must remember that the colloquy between 
the majority leader and the minority would also show clearly that the 
majority leader fully intends to bring reform legislation to this body 
for debate and for final solution.
  I also think about hypocrisy when I think about some of my colleagues 
on the other side of the aisle addressing so many things about the 
majority, except they forgot that our leaders step down when they are 
indicted, because that is what our party rules say. Our chairman 
stepped down because that is what our party rules say. And in the 10 
years while you have been reflecting, your rules don't say the same. 
Your leaders can get indicted, or the ranking members can get indicted 
and you don't have to step down because you haven't even recognized 
that as a basic element of your own party, let alone your quick 
criticisms of this institution.
  I also want to say that while I confess I did not think that BCRA was 
the solution for campaign finance reform, and voted that way on both 
the House Administration Committee and on this floor, I accepted it as 
the law of the land. It was legislation passed by both bodies, signed 
by the President, affirmed by the Supreme Court. But as I was listening 
to those who are pro-BCRA, that wanted this law as it sits today, they 
found a loophole, called 527s.
  And all the debate on leveling the playing field was get the big 
money out of politics. Well, four individuals on the Democratic side 
had over $80 million; four Republicans had over $23 million as they 
were engaged in obscene, big money, unregulated in campaigns 
influencing Presidential, congressional, and referendum votes.
  So when we look at some common sense, I think the American people are 
going to, quite frankly, think this makes sense. Let us get unregulated 
big money out of the campaigns by having a level playing field across 
the system, universal, in the money you give to your political party.
  As we level the playing field, all we are asking is that rich 
individuals who want to be in the process have the same rights extended 
to them that individuals who want to give to the political party, 
whether it is the Democratic National Committee or its subordinate 
parties or the Republican National Committee and its subordinate 
parties, the same amount of money to 527s as they invest in the 
opportunity to express themselves however they want, with the same 
reviewed Supreme Court aspect of having a level playing field across 
the entire system.
  Anyone who doesn't vote for this that supported BCRA is a hypocrite. 
Anyone on the other side that doesn't recognize that this is a loophole 
in the law, and they have a chance to at least level the field under 
the law we are going to live under, misses the point. I urge that you 
support this legislation that is before us today.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield 1\1/2\ minutes to the 
gentleman from Illinois for a response.
  Mr. EMANUEL. There must be something in the water here in Washington.
  To remind my colleague and my friend from Buffalo, the first vote of 
this Congress by the majority party was to strip the Ethics Committee 
that investigates Members of its authority to do that, which is why 
after 15 months in this Congress, the Ethics Committee has not met 
until last week.
  Since that time, one Member stepped down with a guilty plea, another 
Member stepped down with a cloud of ethics, and others are under 
Federal investigation at this point. And why? Because the first vote by 
the Republican majority was to strip the Ethics Committee of its 
authority.
  The second thing. In fact, the majority party did vote this Congress 
that when a Member of their party was indicted, they were allowed to 
hold their party position. You have that vote. You stripped your party 
of that authority and that moral voice when you cast your vote to allow 
the majority leader to retain his position when indicted.
  Now, maybe there is a rampant disease called short-term memory over 
there, but two votes in this Congress: one, if you got indicted, in 
fact, you are allowed to keep your position. You cast those votes on 
your side. And this Congress, when it opened up, rather than address 
the scandals, this Congress, under the majority, not with any 
Democratic support, stripped the bipartisan Ethics Committee from its 
ability to hold investigations, which is why not a single Member to 
date, with all these scandals, some reported by others, congressional 
historians, as the worst scandals in the history of the Congress, still 
the Ethics Committee has failed to do its job because you have stripped 
it of its abilities to do its job.
  That will be the moral stain on this Congress. Your votes.
  Mr. EHLERS. Mr. Speaker, I am pleased to yield 30 seconds to the 
gentleman from New York to respond.
  Mr. REYNOLDS. Mr. Speaker, I look forward to the day when, in our 
Ethics Committee, the Democrats will give the tools to a bipartisan 
five-five Ethics Committee to begin reviewing both Democrats and 
Republicans who need to go before that committee to have resolution of 
stuff that has been stalled for the entire 2005 year by the Democratic 
leadership.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield 20 seconds to respond to 
the gentleman.
  Mr. EMANUEL. My good friend from Buffalo, you may not get health care 
legislation done this year, you may not get educational reform this 
year, and for sure, you won't balance the budget. But this Congress 
will be remembered as the Congress that Jack and Tom built. Because the 
scandals continue to swirl around this institution.
  Until you do serious lobbying reform and close the loopholes, close 
the revolving door, have real transparency, real enforcement, this 
Congress, when that gavel comes down, which is intended to open the 
people's House, not the auction House, and you have allowed it to 
become an auction house, then this is the House that Jack built.
  Ms. MILLENDER-McDONALD. Mr. Speaker, how much time do we have 
remaining?
  The SPEAKER pro tempore (Mr. LaHood). The gentlewoman from California 
has 11\1/2\ minutes remaining; the gentleman from Michigan has 8 
minutes remaining.
  Mr. EHLERS. Mr. Speaker, I reserve the balance of my time.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield 3 minutes to the 
gentleman from Arizona (Mr. Flake).
  Mr. FLAKE. Mr. Speaker, I thank the gentlewoman for yielding.
  Mr. Speaker, this isn't the first time the Congress has debated the 
effects of public campaign discourse. Let me take you back to 1798, 
when about 20 or so independent newspapers aligned with Thomas 
Jefferson started openly criticizing the policies of John Adams, the 
President. Adams used his power and influence to have Congress pass the 
Alien and Sedition Acts, which declared that the publication of false, 
scandalous, and malicious writing was punishable by fine and 
imprisonment. By virtue of this legislation, 25 editors were arrested 
and their newspapers were forced to shut down.
  The first amendment was established to ensure that citizens are able 
to protect themselves from government, not so that government can 
protect itself from the people. If this bill passes, we will be 
standing here having the same debate in a couple of years on how to 
regulate 501(c)4 organizations. 501(c)4s require no disclosure and have 
no contribution limits. They will surely become the 527s of 2008 if 
this legislation passes.
  This legislation, H.R. 513, simply compounds an existing problem. 
Loopholes will always exist, because there will always be money in 
politics. Instead of stifling speech and forcing it to go underground, 
we ought to be lifting up other players in the political system and 
provide more freedoms with greater transparency and more 
accountability.
  Where will this lead? That is the question. If Republicans happen to 
lose in November, lose the majority, what happens when Democrats try to 
level the playing field by applying the so-called fairness doctrine to 
radio talk shows? Surely the Democrats will make the same arguments 
about Rush Limbaugh that Republicans are making about George Soros.

[[Page H1523]]

                              {time}  1745

  Back to the implications of the Alien and Sedition Acts. Americans 
were smart enough to realize what President Adams was using. He was 
using the powers of government to stifle free speech and they reacted 
accordingly. Public opposition to the Alien and Sedition Acts was so 
great that was a large reason Adams was defeated by Thomas Jefferson a 
few years later. This is history worth remembering, Mr. Speaker.
  Mr. EHLERS. Mr. Speaker, I yield 5\1/2\ minutes to the gentleman from 
Connecticut (Mr. Shays), the author of this legislation.
  Mr. SHAYS. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  This is a surreal debate because it is a debate that has consequences 
and yet it seems to almost be like a game. When we passed campaign 
finance reform, it passed primarily with Democratic support and there 
wasn't any talk about free speech because Democrats made the proper 
argument. They made the argument that this was about letting people 
have their speech and not being drowned out by the wealthy.
  That is what the Democrats said: Don't let the wealthy drown out 
people who don't have a lot of resources.
  So what the Democrats are now arguing is that for instance 25 
individual donors should be able to contribute $142 million, or 56 
percent of all of the individual contributions to 527 groups in the 
2004 election. That is what Democrats are saying. They are saying we 
want the wealthy to be able to dominate. But that was not their 
argument when they voted for campaign finance reform, and it was not my 
argument.
  Our argument was that we wanted to have a level playing field. Our 
argument was we wanted to enforce the 1907 law that banned corporate 
treasury money, we wanted to enforce the 1947 Taft-Hartley Act that 
banned forced union dues money, and we wanted to support the 1974 
campaign finance law that said you could not make unlimited 
contributions to federal campaigns. That is what Democrats argued for 
and supported. And they blamed Republicans for being against campaign 
finance reform.
  The amazing thing is once the campaign finance reform bill passed 
Democrats immediately started to break the law. They were looking to 
get around the very law they voted for. And when Mr. Soros, who helped 
fund the campaign finance movement, argued that he should be able to 
contribute unlimited funds to 527s and that he should be able to bring 
his $20-plus million to the table, just this one individual, Democrats 
wanted to protect him and allow him to do that. And Republicans who 
were against the law said this is the law, we are going to abide by it.
  The amazing thing is the very people who did not vote for the law 
were willing to abide by it, and the very people who voted for the law 
are trying to get around the law. That is what I find so amazing about 
this debate.
  So what this amendment does is it just enforces the law that you, my 
fellow colleagues on the other side of the aisle, voted for. It 
enforces the Campaign Finance Act, the McCain-Feingold bill, the bill 
you all supported.
  Now why do we have to pass this bill before us? Because unfortunately 
when we gave it to the Federal Elections Commission, the FEC, who does 
not believe in the law, decided not to enforce the law. They are happy 
to have loopholes. They are the ones who introduced the whole soft 
money issue in the first place.
  So what do we have? We have a loophole that needs to be closed, and 
the way you close it, is to pass this bill that requires 527s to come 
under the campaign finance law. This is because their primary activity, 
in fact their only activity, is campaigns.
  And the law is clear. Mr. Meehan and I brought forward a case against 
the FEC. We threw out 14 of their regulations because they did not 
abide by the law, and then we proceeded to take a court action against 
them on enforcing the law and put 527s under their jurisdiction.
  The court made a decision that Mr. Meehan and I were right, that 527s 
should be under the law. In fact, the judge said not putting them under 
the law circumvented the law. So what we are doing is simply making the 
law consistent. And frankly, this talk of (c)(3)s, (c)(4)s and (c)(5)s, 
is not on point. Their primary responsibility and activity is not 
campaigns. And because of that, you are not going to have the same 
problem that you have with 527s. If in fact their primary activity 
becomes campaigns, then they will come under it.
  This bill is consistent to the law. It is imperative it passes. It is 
consistent with what my colleagues voted for, and I applaud my side of 
the aisle for, in spite of the fact of not voting for the law, be 
willing to live by the law.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield myself such time as I 
may consume.
  I would say to the gentleman who just spoke, this is not what we 
voted for. We did not vote to transfer 527s to 501(c)s. That is 
dishonesty. I oppose those who say this is an obscene bill, 527s are 
not obscene.
  What they are trying to do now here with this bill would provide each 
national and State party committee to be free from any limits in 
spending on behalf of its candidates and the spending would take place 
at any time for the primary or general elections.
  This is the flow of money that the American people are saying take 
out of campaigns.
  Mr. EHLERS. Mr. Speaker, I reserve the balance of my time to close.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I yield myself the balance of my 
time to close.
  Mr. Speaker, I want to clarify that the 527s have been and must 
always file with the Internal Revenue Service. They have to do 
quarterly reports. Unlike what has been said, that they do not have 
disclosure and they do not have reporting, that is not true, and I 
include for the Record the IRS filing dates so that can be placed in 
the Record.

   Internal Revenue Service--United States Department of the Treasury


                   Form 8872 Filing Dates (for 2006)

       During an election year, a political organization has the 
     option of filing on either a quarterly or a monthly schedule. 
     The organization must continue on the same filing schedule 
     for the entire calendar year.

                  OPTION 1.--QUARTERLY FILING SCHEDULE
------------------------------------------------------------------------
                  Report                             Filing Date
------------------------------------------------------------------------
1st Quarter (January 1-March 31)..........  April 17, 2006
2nd Quarter (April 1-June 30).............  July 17, 2007
3rd Quarter (July 1-September 30).........  October 16, 2006
12-Day Pre-General Election*..............  October 26, 2006 (October
                                             23, is posting report by
                                             certified or registered
                                             mail)
30-Day Post-General Election..............  December 7, 2006
Year-End..................................  January 31, 2007
12-Day Pre-Election*......................  12 days before the election
                                             (Varies according to date
                                             of election. See pre-
                                             election reporting dates
                                             chart)
------------------------------------------------------------------------
*A political organization files a 12-day pre-election report(s) prior to
  a federal election (primary, convention, and/or general election) if
  the political organization makes or has made contributions or
  expenditures with respect to a federal candidate(s) participating in
  that election. Therefore, if the organization supported a federal
  candidate in a primary election, it files a 12-day pre-election report
  prior to that candidate's primary election. If the organization made
  contributions or expenditures in connection with a federal
  candidate(s) in the general election, the organization also files the
  12-day pre-general election report.


                   OPTION 2.--MONTHLY FILING SCHEDULE
------------------------------------------------------------------------
                  Report                             Filing Date
------------------------------------------------------------------------
January...................................  February 21
February..................................  March 20
March.....................................  April 20
April.....................................  May 22
May.......................................  June 21
June......................................  July 20
July......................................  August 21
August....................................  September 20
September.................................  October 20
12-Day Pre-General Election*..............  October 26 (October 23, if
                                             posting report by certified
                                             or registered mail)
30-Day Post-General Election*.............  December 7
Year-End..................................  January 31, 2007
------------------------------------------------------------------------
*A political organization files a 12-day pre-election report(s) prior to
  a federal election (primary, convention, and/or general election) if
  the political organization makes or has made contributions or
  expenditures with respect to a federal candidate(s) participating in
  that election. Therefore, if the organization supported a federal
  candidate in a primary election, it files a 12-day pre-election report
  prior to that candidate's primary election. If the organization made
  contributions or expenditures in connection with a federal
  candidate(s) in the general election, the organization also files the
  12-day pre-general election report.

  Mr. Speaker, this bill, H.R. 513, will have a chilling effect on tax 
exempt 501(c) organizations. Despite a provision exempting nonprofit 
charities and social service organizations, this bill, H.R. 513, 
regulates the same activities that such entities are permitted to 
engage in.
  Should this bill become law, a precedent may be set that all 
nonprofit activities should be heavily regulated leading to significant 
new restrictions on 501(c)3s. H.R. 513 thus may represent a trend with 
chilling implications for the nonprofit sector.
  Mr. Speaker, I include for the Record a statement from the CATO 
Institute, a conservative think tank.

[[Page H1524]]

          Cato Institute--Free Speech and the 527 Prohibition

                (By Stephen M. Hoersting--April 3, 2006)


       Limiting the Speech of Independent Speakers Is Unwise and 
                            Unconstitutional

     Forcing PACs on citizens is a matter for courts, not just 
         Congress
       To constitutionally regulate campaign finance, the 
     government must demonstrate that the ``harms it recites are 
     real,'' not ``mere speculation or conjecture.'' Proposals to 
     subject section 527 organizations to political committee 
     status, with scant regard to their activities, effectively 
     impose an ``any purpose'' test in brazen disregard of the 
     ``major purpose'' test the Supreme Court established in 
     Buckley v. Valeo. Such proposals presume that any 
     communication mentioning a candidate that promotes, supports, 
     attacks, or opposes that candidate at any time of the year--
     or any ``voter drive activity,'' even if totally non-
     partisan--is sufficient to trigger political committee 
     status. If such proposals were in effect during the last 
     cycle, any mention of President Bush's or Senator Kerry's 
     policies from November 2, 2003 to November 2, 2004, or any 
     attempt to identify voters, would have turned the 527 
     organization into a federal political committee. In FEC v. 
     Beaumont, the Court noted that a non-profit corporation 
     entitled to the MCFL exemption of federal campaign law--which 
     exempts certain non-profit corporations from FECA's 
     registration requirement--would have to register as a 
     political committee to make contributions to federal 
     candidates, though it would not have to register to make 
     independent expenditures. The direct nexus to a federal 
     candidate and the entity's enjoyment of the corporate form 
     were ample reason to require it to register. There is no such 
     connection here, however, or existing 527 organizations would 
     already be covered.
       Establishing and maintaining a PAC, however, is not a minor 
     administrative task, and it has become more onerous with each 
     new round of restrictions on PACs and those who run them. 
     Gone will be the ability of citizens to adapt quickly and 
     associate freely in support of a position when issues arise. 
     The various funding source, amount, and disclosure 
     requirements of PAC compliance make it difficult to raise the 
     quantities of money for broadcast communications. New or 
     small organizations may have a hard time, given the limited 
     number of employees or members from whom they can solicit at 
     all: not just anyone may contribute to a PAC; you have to 
     belong to the organization, or work for the company or union 
     that sponsors it. That has practical consequences of which 
     courts are aware. The Swift Vets' communications would have 
     been impossible, for example, without the modest seed money 
     that would become illegal under current 527 proposals. Or if 
     the PAC were wildly successful, however unlikely, it would 
     come at the expense of other right-leaning PACs or party 
     committees, all of which rely on individual contributors 
     bound by biennial aggregate limits on their contributions to 
     all political committees during an election cycle. In other 
     words, the question of who will join your PAC in time to 
     raise enough funds at a maximum of $5000 per person for 
     advertising is a very real constraint on an organization's 
     ability to run advertising--independent advertising, no less.
     Independent voices can't be limited
       Forcing political committee status on the organizations is 
     only one question in assessing constitutionality. The ``key 
     question is whether individual contributions to any political 
     committee--527 or not--that does not make contributions to a 
     candidate but instead makes only expenditures can be subject 
     to limitation.'' In Buckley v. Valeo, the Supreme Court 
     stated that the First Amendment permits the government to 
     regulate campaign spending to prevent the corruption of 
     officeholders or its appearance. The Court has not recognized 
     any interest in ``equalizing'' speech. Contributions and 
     funds spent in coordination with a candidate can be limited 
     to protect against legislative quid pro quos. The Court has 
     also said that contributions to an organization that in turn 
     makes both contributions and independent expenditures 
     (defined constitutionally as ``express advocacy'') can also 
     be limited to make regulatory oversight feasible; to prevent 
     the possibility that unlimited funds would flow to 
     candidates. But independent spending lacks the necessary 
     connection to officeholders, is not corrupting, and cannot be 
     limited. The ``absence of prearrangement and coordination of 
     an expenditure with the candidate or his agent not only 
     undermines the value of the expenditure to the candidate, but 
     also alleviates the danger that expenditures will be given as 
     a quid pro quo for improper commitments from the candidate.'' 
     Independent spending is not corrupting. Likewise, 
     contributions to organizations that engage in independent 
     spending are also not corrupting. The Court has already 
     granted constitutional protection to an individual's 
     independent spending. George Soros may buy all the 
     advertising he wants. That right extends also to an 
     individual's donation to an organization that engages in 
     independent spending. ``The independent expenditure ceiling 
     fails to serve any substantial governmental interest in 
     stemming the reality or appearance of corruption in the 
     electoral process . . . and `` `heavily burdens core First 
     Amendment protection.' ''
       As stated by Professor Richard Briffault, ``[t]wo Supreme 
     Court decisions provide support for the argument that if an 
     independent expenditure does not present a danger of 
     corrupting or appearing to corrupt officeholders, then 
     contributions to a political committee that makes only 
     independent expenditures cannot be limited.'' The first case 
     is California Medical Ass'n v. FEC, a case involving limits 
     on contributions by a trade association to its own PAC. In 
     the plurality was Justice Blackmun, who wrote in concurrence 
     that although the limit on contributions to a political 
     committee is valid ``as a means of preventing evasion of the 
     limitations on contributions to a candidate[,] . . . a 
     different result would follow [if the limit] were applied to 
     donations to a political [organization] established for the 
     purpose of making independent expenditures, rather than 
     contributions,'' because ``a committee that makes only 
     independent expenditures . . . poses no threat'' of 
     corruption. Professor John Eastman has noted that 
     contributions to a committee that does not give to 
     candidates, such as most section 527 organizations 
     contemplated by current proposals, are deserving of even more 
     constitutional protection because ``the principal message 
     expressed by a contribution to a noncandidate committee is 
     agreement with and furtherance of that committee's views,'' 
     unlike the message expressed by contributions to a candidate 
     committee or a committee that in turn gives to candidates. 
     This approach is bolstered by the second case, Citizens 
     Against Rent Control, which invalidated a contribution limit 
     to a ballot proposition committee because the lack of a nexus 
     to a candidate made corruption inapplicable. Similarly, where 
     the nexus to an officeholder is not present, the anti-
     circumvention rationale of McConnell is also not furthered by 
     a limit on contributions to organizations that engage in 
     wholly independent activity.
       Even though the contribution limit applies to the 
     independent spending of political committees that also 
     contribute to candidates or make coordinated expenditures, it 
     is not clear that the Court would approve limits on 
     organizations that engage in wholly independent activity. As 
     noted by Professor Briffault, the McConnell Court's treatment 
     of this issue related to BCRA's application of contribution 
     limits to the activities of political parties.'' \47\ But the 
     section 527 organizations Congress appears interested in and 
     political party committees are not alike. ``[F]ederal 
     candidates and officeholders enjoy a special relationship and 
     unity of interest'' with their political party, said the 
     McConnell Court. \48\ ``The national committees of the two 
     major parties are both run by, and largely composed of, 
     federal officeholders and candidates.'' \49\ The ``close 
     connection and alignment of interests'' between candidates 
     and their political parties means that ``large soft-money 
     contributions to national parties are likely to create the 
     actual or apparent indebtedness on the part of federal 
     officeholders, regardless of how those funds are ultimately 
     spent,'' \50\ and the same is true of ``the close ties 
     between federal candidates and state party committees.'' \51\
       The same cannot be said of 527 organizations. There is no 
     record that candidates or party committees coordinated their 
     spending with the 527s. Section 527 organizations simply have 
     no comparable ties to candidates, thus making the anti-
     circumvention rationale of McConnell far too tenuous and 
     unsuitable. Spending by section 527 organizations does not 
     corrupt the legislative process because there is no nexus to 
     lawmakers. It does not corrupt the balloting process. And 
     spending by section 527 organizations does not corrupt the 
     process of information exchange in the run up to the 
     election. Indeed, spending by section 527 organizations is an 
     integral part of the process of information exchange. And the 
     information exchange needs to be open, robust and 
     uninhibited.
     More speech is what is needed, not less
       Studies indicate that campaign spending diminishes neither 
     trust nor involvement by citizens in elections. Indeed, 
     spending increases public knowledge of candidates among all 
     groups in the population. ``Higher campaign spending produces 
     more knowledge about candidates,'' whether measured by name 
     identification, association of candidates with issues, or 
     ideology; and setting a cap on spending would likely produce 
     a less informed electorate. \52\ Unlimited spending does not 
     confuse the public, \53\ and the benefits of campaign 
     spending are broadly dispersed across advantaged and 
     disadvantaged groups alike. That is, as incumbents are 
     challenged by spending, both advantaged and disadvantaged 
     groups gain in knowledge. \54\ And so-called negative 
     advertising campaigns do not demobilize the public, as many 
     have alleged. \55\
     Razing speech to the same level
       Yet many persons inside the beltway believe that 527s 
     should be regulated on egalitarian grounds. Republican Party 
     chairman Ken Mehlman is outspoken in support of 527 
     regulation, declaring that Congress ``must reform 527s, so 
     that everyone plays at the same level, and billionaires can't 
     once again use loopholes to try to buy elections.'' \56\ 
     Democratic Party chairman Howard Dean signed expenditure 
     limit legislation as Governor of Vermont and had the DNC file 
     an amicus brief to the Supreme Court in support of the 
     legislation. \57\ Senator John McCain ``said that lawmakers 
     should support the bill out of self-interest, because it 
     would prevent a rich activist from trying to defeat an 
     incumbent by diverting money into a political race through a 
     527 organization. `That should alarm every federally elected 
     Member of Congress,' he said.'' \58\ Senator Trent Lott

[[Page H1525]]

     has called for limits on 527s to ``level the playing field.'' 
     \59\ That these candidates and party chairs notice the 
     spending and how it may benefit or hurt them is also a 
     tenuous justification for regulation. Dissenting in 
     McConnell, Chief Justice William Rehnquist wrote that 
     benefit--even benefit expressed in gratitude--is not enough 
     to justify restrictions, otherwise this rationale could serve 
     as a basis to regulate ``editorials and political talk shows 
     [that] benefit federal candidates and officeholders every bit 
     as much as a generic voter registration drive conducted by a 
     state party,'' \60\ a position adopted by the McConnell 
     majority. \61\ Preventing circumvention of applicable 
     contribution limits and source prohibitions was the rationale 
     employed by the Court in McConnell. The rationale was not to 
     foster egalitarianism. \62\
       Buckley long ago rejected the argument that ``equalizing 
     the relative ability of individuals and groups to influence 
     the outcome of elections'' \63\ is a compelling interest, 
     adding that ``the concept that government may restrict the 
     speech of some elements of our society in order to enhance 
     the relative voice of others is wholly foreign to the First 
     Amendment.'' \64\ The Court has said elsewhere that trying to 
     manipulate groups' relative ability to speak ``is a decidedly 
     fatal objective.'' \65\ And there is good reason to be 
     suspicious of the motives of incumbent legislators and party 
     chairmen seeking egalitarianism in campaign spending. After a 
     certain level of spending, the utility of further spending 
     declines, and incumbents hit the point of marginal utility 
     earlier than opponents. \66\ Political free trade is both the 
     norm and normative prescription for a healthy and 
     constitutional political system in America. And ``[p]olitical 
     `free trade' does not necessarily require that all who 
     participate in the political marketplace do so with exactly 
     equal resources.'' \67\

  Mr. Speaker, the CATO Institute writes that limiting the speech of 
independent speakers is unwise and unconstitutional. In fact, forcing 
PACs on citizens is a matter for courts and not Congress. To 
constitutionally regulate campaign finance, the government must 
demonstrate that the harms it recites are real, not just mere 
speculation or conjecture. Proposals to subject section 527 
organizations to political committee status with scant regard to their 
activities effectively imposes an any-purpose test in brazen disregard 
for the major purpose test of the Supreme Court established under 
Buckley v. Valeo.
  Mr. Speaker, conservative groups are saying this is not good policy, 
that this policy is shutting down those groups that were independent, 
free of Congress, free of the Members of Congress, and this bill 
influences the outcome of elections and in fact money will be flowing 
all over the place as it is doing right now. Money will be flowing all 
over the place as we are speaking today.
  This is a bad bill. The American people do not want more money into 
these campaigns. They want less money. I urge a ``no'' vote on this 
bill.
  Mr. Speaker, I yield back the balance of my time.
  Mr. EHLERS. Mr. Speaker, I yield 1\1/2\ minutes to the gentleman from 
Massachusetts (Mr. Meehan), the other sponsor of the bill from the 
minority side.
  Mr. MEEHAN. Mr. Speaker, I thank the gentleman for yielding me this 
time.
  Mr. Speaker, basically this is a legal issue. 527s are legally 
established because their primary purpose is to influence the election 
or defeat of a Federal candidate. They have to file with the FEC 
because after Watergate in 1974 this Congress passed a law that said if 
you are going to have a political committee whose primary purpose is to 
influence an election, then they have to register with the FEC.
  The FEC ignored 30 years of congressional actions and Supreme Court 
jurisprudence in allowing 527s to evade the law. In short, the FEC 
failed to do its job and regulate 527s as required under the Watergate 
statute. So in September of 2004, Congressman Shays and I filed a suit 
against the FEC for failing to enforce the regulations.
  You know what is interesting, just last Wednesday the U.S. District 
Court Judge Sullivan ruled in favor of our position that the FEC had 
failed to present a reasonable explanation for its decision in 2004 not 
to regulate 527s. Judge Sullivan remanded the case back to the FEC and 
said either you articulate a reason for not regulating 527s or 
promulgate a new rule. A new rule that regulates 527s is called for 
under the law. That is all we are seeking to do here. That is all we 
are seeking to do. One way or the other, the court is going to rule in 
favor. This is one way for us to do it quickly.
  Mr. EHLERS. Mr. Speaker, I yield myself the balance of my time to 
close.
  I just have to say, I am a little disappointed in this debate. In 
fact, I am greatly disappointed in this debate. I am just a simple 
person who grew up in a small town, and I grew up in an area where we 
said what we meant, and we meant what we said.
  I have heard so much diversionary discussion on this topic from the 
minority today, it is very disappointing to me.
  The proposition of the bill is very simple: unlimited spending of 
soft money was intended to be banned under BCRA. A diversionary tactic 
has developed which allows the expenditures of huge amounts of money, 
unregulated soft money, and this bill today is an attempt to stop that 
practice which is being carried out by people who are violating the 
intent of a law we passed a few years ago. That plain and simple is the 
issue here.
  I urge the body to adopt the bill and stop the abominable practice of 
huge amounts of unregulated, unreported money influencing elections. 
Let's get back to the original intent of BCRA and put it in place and 
enforce it.
  Mr. Speaker, I include for the Record the material I previously 
referred to.

                [From the New York Times, Dec. 29, 2004]

                        The Soft Money Boomerang

       It's encouraging to see signs of life in Washington, 
     particularly on the Republican side of the aisle, over the 
     obvious need to plug the newest subterranean pipe for 
     unregulated campaign funds from big labor, big corporations 
     and just plain big money.
       Of all the subplots in the presidential election, none were 
     as sorry as the Democrats' pioneering ``527'' groups--named 
     for the section of the tax code that governs them. The 527's 
     were intended to circumvent the law's strictures against 
     having unlimited soft money flood into political races. The 
     Democrats built these new shadow-party advocacy groups to 
     attack the president early in the campaign season and build 
     voter-turnout machines. Then they watched Bush partisans 
     adapt the same financing device to float the campaign's most 
     notorious and devastating attack ads, the Swift boat assaults 
     on John Kerry's heroic war record and his antiwar activities 
     after he returned from Vietnam.
       Dollar-wise, the Democrats proved better at milking the 527 
     strategy, spending more than three times as much as the 
     Republicans in stealth-party ads favoring their presidential 
     ticket. But the Republicans wielded their ads like a rapier 
     once the Federal Election Commission, true to its track 
     record, shirked its responsibility by deciding that the new 
     breed of advocacy groups should not be controlled under the 
     campaign finance reform laws.
       A commission majority endorsed the fiction that the 527's 
     are independent. The truth is that they were strategically 
     linked to the candidates and perfect targets for aggressive 
     F.E.C. regulation and spending limits. The 527 fund-raisers 
     were the V.I.P. toast of the party conventions last summer, 
     raising money in luxury suites with a wink and a grin.
       After this year's election drubbings, you would think the 
     Democrats would now see the folly of the 527 committees. But, 
     no, ranking Democrats are determined to make them a permanent 
     campaign weapon, with no dollar caps on the corporations, 
     labor unions and fat-cat partisans who spent more than $550 
     million on such committees in this year's races.
       President Bush condemned the 527's and promised a crackdown 
     when the Democrats first exploited them and caught the G.O.P. 
     short. But later in the campaign, he failed to condemn the 
     Swift boat ads when Senator John McCain did so and pointedly 
     asked for the president's support. Now Mr. Bush has another 
     chance to put his considerable political weight behind Mr. 
     McCain, who is determined to use the coming Congressional 
     session to pass legislation that would force this blowzy 
     lucre-genie back into the bottle.
       Senator McCain overcame whatever past bad feeling there was 
     between himself and the president and became a dogged Bush 
     campaigner this year. We hope the president repays him by 
     explicitly backing the McCain fight to stop the 527 
     gamesmanship as an abuse of fair elections. And it's equally 
     important for the president to enlist in the senator's 
     campaign to overhaul the election commission. The F.E.C. is a 
     transparent extension of hack party politics, beholden to 
     members of Congress who are more concerned with their own 
     incumbency than the public interest.
                                  ____


                [From the Washington Post, Apr. 5, 2006]

                         Close the 527 Loophole


      congress should beach the swift boats and george soros, too

       The House plans to take up legislation today that would 
     close the biggest remaining loophole in the campaign finance 
     system. It would require the political groups known as 527s 
     to play by the same rules as other committees that aim to 
     influence federal elections. The House ought to pass the 
     measure, sponsored by Reps. Christopher Shays (R-

[[Page H1526]]

     Conn.) and Martin T. Meehan (D-Mass.), and shut down the kind 
     of 527 ``soft money'' operation that flourished during the 
     2004 campaign, like Democrats' America Coming Together and 
     Republicans' Swift Boat Veterans for Truth.
       These committees, named after the section of the tax code 
     under which they're established, are by definition 
     ``organized and operated primarily'' to influence elections. 
     When those elections are for federal office, it makes no 
     sense to let such groups collect six-, seven- and even eight-
     figure checks to elect or defeat candidates, while 
     candidates, political parties and political action committees 
     are limited to receiving contributions a small fraction of 
     that size. Similarly, corporations and labor unions--barred 
     by law from contributing directly to federal candidates or 
     parties--shouldn't be allowed to write checks to 527s, which 
     exist for the same purpose.
       The usual politics of campaign finance reform--Democrats 
     for (at least publicly), Republicans against--are upside down 
     this time around. The reason is that Republicans do better 
     than Democrats at raising the (relatively) small donations 
     known as ``hard money,'' while Democrats took the lead in the 
     past election cycle in raising soft money for 527 groups. 
     Connoisseurs of hypocrisy should enjoy this spectacle, but 
     the partisan calculations are probably overstated. Democrats, 
     with the rise of the Internet, have been improving their 
     hard-money fundraising. Republicans are bound to draw even in 
     the 527 race if it continues.
       There are concerns that regulating money to 527s would 
     drive spending further into the shadows, to nonprofit groups 
     and trade associations that, unlike 527s, don't even have to 
     disclose their donors and spending. But there are 
     restrictions on the partisan activity of such groups, and if 
     a problem develops with the misuse of such organizations, 
     that could be addressed in future legislation. It's not a 
     reason for inaction now.
                                  ____


               [From the Washington Post, Nov. 11, 2003]

Soros's Deep Pockets vs. Bush; Financier Contributes $5 Million More in 
                        Effort To Oust President

                         (By Laura Blumenfeld)

       New York.--George Soros, one of the world's richest men, 
     has given away nearly $5 billion to promote democracy in the 
     former Soviet bloc, Africa and Asia. Now he has a new 
     project: defeating President Bush.
       ``It is the central focus of my life,'' Soros said, his 
     blue eyes settled on an unseen target. The 2004 presidential 
     race, he said in an interview, is ``a matter of life and 
     death.''
       Soros, who has financed efforts to promote open societies 
     in more than 50 countries around the world, is bringing the 
     fight home, he said. On Monday, he and a partner committed up 
     to $5 million to MoveOn.org, a liberal activist group, 
     bringing to $15.5 million the total of his personal 
     contributions to oust Bush.
       Overnight, Soros, 74, has become the major financial player 
     of the left. He has elicited cries of foul play from the 
     right. And with a tight nod, he pledged: ``If necessary, I 
     would give more money.''
       ``America, under Bush, is a danger to the world,'' Soros 
     said. Then he smiled: ``And I'm willing to put my money where 
     my mouth is.''
       Soros believes that a ``supremacist ideology'' guides this 
     White House. He hears echoes in its rhetoric of his childhood 
     in occupied Hungary. ``When I hear Bush say, `You're either 
     with us or against us,' it reminds me of the Germans.'' It 
     conjures up memories, he said, of Nazi slogans on the walls, 
     Der Feind Hort mit (``The enemy is listening''). ``My 
     experiences under Nazi and Soviet rule have sensitized me,'' 
     he said in a soft Hungarian accent.
       Soros's contributions are filling a gap in Democratic Party 
     finances that opened after the restrictions in the 2002 
     McCain-Feingold law took effect. In the past, political 
     parties paid a large share of television and get-out-the-vote 
     costs with unregulated ``soft money'' contributions from 
     corporations, unions and rich individuals. The parties are 
     now barred from accepting such money. But non-party groups in 
     both camps are stepping in, accepting soft money and taking 
     over voter mobilization.
       ``It's incredibly ironic that George Soros is trying to 
     create a more open society by using an unregulated, under-
     the-radar-screen, shadowy, soft-money group to do it,'' 
     Republican National Committee spokeswoman Christine Iverson 
     said. ``George Soros has purchased the Democratic Party.''
       In past election cycles, Soros contributed relatively 
     modest sums. In 2000, his aide said, he gave $122,000, mostly 
     to Democratic causes and candidates. But recently, Soros has 
     grown alarmed at the influence of neoconservatives, whom he 
     calls ``a bunch of extremists guided by a crude form of 
     social Darwinism.''
       Neoconservatives, Soros said, are exploiting the terrorist 
     attacks of Sept. 11, 2001, to promote a preexisting agenda of 
     preemptive war and world dominion. ``Bush feels that on 
     September 11th he was anointed by God,'' Soros said. ``He's 
     leading the U.S. and the world toward a vicious circle of 
     escalating violence.''
       Soros said he had been waking at 3 a.m., his thoughts 
     shaking him ``like an alarm clock.'' Sitting in his robe, he 
     wrote his ideas down, longhand, on a stack of pads. In 
     January, PublicAffairs will publish them as a book, ``The 
     Bubble of American Supremacy'' (an excerpt appears in 
     December's Atlantic Monthly). In it, he argues for a 
     collective approach to security, increased foreign aid and 
     ``preventive action.''
       ``It would be too immodest for a private person to set 
     himself up against the president,'' he said. ``But it is, in 
     fact''--he chuckled--``the Soros Doctrine.''
       His campaign began last summer with the help of Morton H. 
     Halperin, a liberal think tank veteran. Soros invited 
     Democratic strategists to his house in Southampton, Long 
     Island, including Clinton chief of staff John D. Podesta, 
     Jeremy Rosner, Robert Boorstin and Carl Pope.
       They discussed the coming election. Standing on the back 
     deck, the evening sun angling into their eyes, Soros took 
     aside Steve Rosenthal, CEO of the liberal activist group 
     America Coming Together (ACT), and Ellen Malcolm, its 
     president. They were proposing to mobilize voters in 17 
     battleground states. Soros told them he would give ACT $10 
     million.
       Asked about his moment in the sun, Rosenthal deadpanned: 
     ``We were disappointed. We thought a guy like George Soros 
     could do more.'' Then he laughed. ``No, kidding! It was 
     thrilling.''
       Malcolm: ``It was like getting his Good Housekeeping Seal 
     of Approval.''
       ``They were ready to kiss me,'' Soros quipped.
       Before coffee the next morning, his friend Peter Lewis, 
     chairman of the Progressive Corp., had pledged $10 million to 
     ACT. Rob Glaser, founder and CEO of RealNetworks, promised $2 
     million. Rob McKay, president of the McKay Family Foundation, 
     gave $1 million, and benefactors Lewis and Dorothy Cullman 
     committed $500,000.
       Soros also promised up to $3 million to Podesta's new think 
     tank, the Center for American Progress.
       Soros will continue to recruit wealthy donors for his 
     campaign. Having put a lot of money into the war of ideas 
     around the world, he has learned that ``money buys talent; 
     you can advocate more effectively.''
       At his home in Westchester, N.Y., he raised $115,000 for 
     Democratic presidential candidate Howard Dean. He also 
     supports Democratic presidential contenders Sen. John F. 
     Kerry (Mass.), retired Gen. Wesley K. Clark and Rep. Richard 
     A. Gephardt (Mo.).
       In an effort to limit Soros's influence, the RNC sent a 
     letter to Dean Monday, asking him to request that ACT and 
     similar organizations follow the McCain-Feingold restrictions 
     limiting individual contributions to $2,000.
       The RNC is not the only group irked by Soros. Fred 
     Wertheimer, president of Democracy 21, which promotes changes 
     in campaign finance, has benefited from Soros's grants over 
     the years. Soros has backed altering campaign finance, an 
     aide said, donating close to $18 million over the past seven 
     years.
       ``There's some irony, given the supporting role he played 
     in helping to end the soft money system,'' Wertheimer said. 
     ``I'm sorry that Mr. Soros has decided to put so much money 
     into a political effort to defeat a candidate. We will be 
     watchdogging him closely.''
       An aide said Soros welcomes the scrutiny. Soros has become 
     as rich as he has, the aide said, because he has a 
     preternatural instinct for a good deal.
       Asked whether he would trade his $7 billion fortune to 
     unseat Bush, Soros opened his mouth. Then he closed it. The 
     proposal hung in the air: Would he become poor to beat Bush?
       He said, ``If someone guaranteed it.''
                                  ____

                                                    April 4, 2006.
       Dear Representative: The House is scheduled to consider 
     this week H.R. 513, legislation sponsored by Representatives 
     Chris Shays (R-CT) and Marty Meehan (D-MA) to require that 
     527 groups spending money to influence federal elections 
     comply with federal campaign finance laws.
       Our organizations support H.R. 513, which is necessary to 
     close the FEC-created loophole that allowed both Democratic 
     and Republican 527 groups to spend hundreds of millions of 
     dollars in unlimited soft money to influence the 2004 
     presidential and congressional elections.
       The organizations include the Campaign Legal Center, Common 
     Cause, Democracy 21, the League of Women Voters, Public 
     Citizen and U.S. PIRG.
       Under H.R. 513, the 527 political groups would be able to 
     continue to undertake activities to influence federal 
     elections, but would do so under the same campaign finance 
     laws that apply to candidates, political parties and other 
     political committees whose major purpose is to influence 
     federal elections. Enclosed is a Q and A on H.R. 513.
       Much of the soft money contributed to 527 groups to 
     influence the 2004 federal elections came from a relatively 
     small number of very wealthy individuals. According to 
     campaign finance scholar Anthony Corrado, just 25 individuals 
     accounted for $146 million raised by Democratic and 
     Republican 527 groups that spent money to influence the 2004 
     federal elections.
       In order to qualify as a 527 group under the Internal 
     Revenue Code and receive tax-exempt status, Section 527 
     groups must be ``organized and operated primarily'' to 
     influence elections. They are, by definition, ``political 
     organizations,'' not ``issue groups,'' and they should not be 
     operating outside federal campaign finance laws when they are 
     spending money to influence federal elections.

[[Page H1527]]

       As the Supreme Court stated in the McConnell case upholding 
     the constitutionality of the Bipartisan Campaign Reform Act, 
     Section 527 groups ``by definition engage in partisan 
     political activity.'' The Court stated in McConnell that 527 
     groups ``are, unlike Sec. 501(c) groups, organized for the 
     express purpose of engaging in partisan political activity.''
       Section 527 groups are treated differently under campaign 
     finance laws than Section 501(c) groups because they are 
     fundamentally different entities than 501(c) groups.
       Section 527 groups, by definition, are organized and 
     operated ``primarily'' to influence elections. This standard 
     has long been used to define political groups that are 
     covered by and must comply with federal campaign finance 
     laws. Section 527 groups have the same organizing principle 
     as candidate committees, political party committees and 
     PACs--their primary purpose is to influence elections--and 
     should be subject to the same campaign finance laws.
       Section 501(c) groups, by contrast, are prohibited by their 
     tax status from having a primary purpose to influence 
     elections. Although Section 501(c) groups (except for 
     charitable groups) are permitted to spend some money for 
     political purposes, tax laws impose constraints on the 
     political activity they can engage in, while similar 
     constraints are not imposed on 527 groups.
       The 2004 election demonstrated widespread soft money abuses 
     by 527 groups, which spent hundreds of millions of dollars to 
     influence the presidential and congressional elections 
     without complying with the federal campaign finance laws. 
     H.R. 513 addresses this demonstrated problem.
       As we noted in our letter yesterday, an amendment may be 
     offered by Representative Mike Pence (R-IN) to repeal the 
     existing aggregate limit on the total contributions that an 
     individual can give to all federal candidates and political 
     parties in a two-year election cycle. The Pence amendment 
     would repeal an essential Watergate reform that was enacted 
     to prevent corruption and the appearance of corruption, and 
     was upheld as constitutional on this basis by the Supreme 
     Court.
       We strongly oppose the Pence proposal, which would allow a 
     President, Senator or Representative to solicit, and a single 
     donor to contribute, a total of more than $3,000,000 for the 
     officeholder's party and the party's congressional candidates 
     in a two-year election cycle.
       We urge you to vote against the Pence ``poison pill'' 
     amendment and also urge you to vote against H.R. 513 if it 
     includes the Pence proposal or any variation of it.
       Another proposal may be made to repeal section 441a(d) of 
     the campaign finance laws, a provision which imposes limits 
     on spending by political parties in coordination with their 
     federal candidates.
       We oppose repealing the limits on coordinated party 
     spending with candidates.
       Under Supreme Court rulings, a political party can spend an 
     unlimited amount of hard money in a federal candidate's race, 
     independently of that candidate, even if the party has 
     reached its limit on coordinated spending with that candidate 
     in the race.
       Thus, repeal of the limits on coordinated spending will not 
     change the total amount of money a political party can spend 
     in a given race, but rather will change the amount that can 
     be spent in coordination with the party's candidate in the 
     race.
       Supporters of repealing the limit argue that this is a more 
     effective way for parties to assist their candidates. We 
     oppose repeal of the coordinated spending limit, however, 
     since it provides a constraint on parties serving as a 
     vehicle for individual donors to evade the limits on 
     contributions from individuals to candidates.
       H.R. 513 is based on the simple proposition that a 527 
     group that spends money to influence federal elections should 
     abide by the same set of rules that apply to other political 
     groups whose purpose is to spend money to influence federal 
     elections. There is no basis for allowing a 527 group to 
     claim the advantage of a tax exemption as a ``political 
     organization'' under the tax laws, while at the same time 
     failing to comply with the federal campaign finance laws on 
     the claim that it is not a ``political committee.''
       We strongly urge you to vote for H.R. 513, provided it does 
     not include the Pence ``poison pill'' proposal to repeal or 
     undermine the aggregate limit on individual contributions.
     Campaign Legal Center
     Common Cause
     Democracy 21
     League of Women Voters
     Public Citizen
     U.S. PIRG
                                  ____



                                     House of Representatives,

                                    Washington, DC, April 4, 2006.
     Hon. Vernon J. Ehlers,
     Chairman, Committee on House Administration, House of 
         Representatives, Washington, DC.
       Dear Chairman Ehlers: In recognition of the desire to 
     expedite consideration of H.R. 513, the ``527 Reform Act of 
     2005,'' the Committee on the Judiciary hereby waives 
     consideration of the bill. There are provisions contained in 
     H.R. 513 that implicate the rule X jurisdiction of the 
     Committee on the Judiciary. Specifically, section 5 provides 
     for judicial review of certain constitutional challenges to 
     the legislation. This provision implicates the rule 
     X(1)(l)(1) jurisdiction of the Committee over ``the judiciary 
     and judicial proceedings, civil and criminal.''
       The Committee takes this action with the understanding that 
     by foregoing consideration of H.R. 513, the Committee on the 
     Judiciary does not waive any jurisdiction over subject matter 
     contained in this or similar legislation. The Committee also 
     reserves the right to seek appointment to any House-Senate 
     conference on this legislation and requests your support if 
     such a request is made. Finally, I would appreciate your 
     including this letter in the Congressional Record during 
     consideration of H.R. 513 on the House floor. Thank you for 
     your attention to these matters.
           Sincerely,
                                      F. James Sensenbrenner, Jr.,
     Chairman.
                                  ____

                                    U.S. House of Representatives,
                                    Washington, DC, April 4, 2006.
     Hon. James Sensenbrenner,
     Chairman, Committee on the Judiciary, House of 
         Representatives, Washington, DC.
       Dear Chairman Sensenbrenner: Thank you for your recent 
     letter regarding your Committee's jurisdictional interest in 
     H.R. 513, the 527 Reform Act of 2006, scheduled for floor 
     consideration this week.
       I acknowledge your committee's jurisdictional interest in 
     Section 5 of the bill, and agree that your decision to forego 
     further action on it will not prejudice the Committee on the 
     Judiciary with respect to its jurisdictional prerogatives on 
     this or similar legislation. I will include a copy of your 
     letter and this response in the Congressional Record when the 
     legislation is considered by the House.
       Thank you again for your assistance.
           Sincerely,
                                                 Vernon J. Ehlers,
                                                         Chairman.

  Mr. EHLERS. Mr. Speaker, I yield back the balance of my time.
  Mr. BLUMENAUER. Mr. Speaker, throughout my career, I have 
consistently and strongly supported sensible campaign finance reform. 
As introduced, H.R. 513, the 527 Reform Act, was a measure I could have 
supported. In the long run, it would have been politically neutral; not 
giving an advantage to either Republicans or Democrats.
  However, with the changes that have been made to the bill by the 
Republican leadership, this bill would needlessly allow unlimited 
contributions from party committees to coordinate with campaigns and 
thereby dramatically raising the amount of money spent on elections, 
not reduce it. This provision alone would dramatically undermine the 
campaign finance reforms we worked so hard to put in place in 2002. The 
bill is neither necessary nor fair and would increase the role of money 
in campaigns and elections.
  Mr. VAN HOLLEN. Mr. Speaker, today I voted against H.R. 513, the 
``527 Reform Act of 2005'' introduced by Congressmen Shays and Meehan. 
As a strong and long-term supporter of the Shays-Meehan/McCain-Feingold 
campaign reform legislation, I want to take this opportunity to explain 
my decision to vote against H.R. 513 today.
  On the surface, H.R. 513 appears to be simple. It would require ``527 
groups,'' which represent individuals or groups that are not directly 
affiliated with political party organizations, to register and report 
with the Federal Election Commission in the same manner as political 
committees. I support that part of this bill.
  However, the Republican Leadership inserted a poison pill into the 
bill. In the dark of night, the Republican-controlled House Rules 
Committee added an amendment to roll back current limits on 
Congressional campaign committee spending in supporting a candidate in 
a House general election. In 2006, Congressional committees are limited 
to spending a maximum of $79,200 in a Congressional race. This amount 
is set by law and adjusted for inflation. Under current law, 
Congressional campaign committees possess the authority to spend 
unlimited amounts on a campaign. Congressional committees must 
currently borrow and use the limits assigned by law to each party's 
national committee and each state party committee. The amended bill 
will lift current caps and upset the balance of spending.
  A second killer amendment eliminates Congressional campaign committee 
limits on party spending for Congressional candidates. This bill allows 
each party to accept transfers from other committees within the party 
structure when spending for a candidate. This change will enable the 
National Republican Congressional Committee to accept unlimited 
transfers from the Republican National Committee for use in spending on 
any Congressional campaign. It is not a coincidence that Republicans 
outspend Democrats 5:1.
  We have just seen the former Republican Majority Leader resign from 
Congress in disgrace. Another prominent member of the majority party 
sits in jail for accepting tawdry bribes while selling his office. 
Prominent administration officials have been arrested or are under 
indictment. This is not a time to be playing parliamentary games with 
the ethical process.
  And that is why I voted against this shamefully amended version of 
H.R. 513 today.
  Mr. CASTLE. Mr. Speaker, I am proud to join my colleagues in strong 
support of H.R.

[[Page H1528]]

513, the 527 Reform Act of 2006. H.R. 513 takes an important step in 
closing a ``soft-money'' loophole by requiring 527 groups to comply 
with the same federal campaign laws that political parties and 
political action committees must follow.
  In fact, the Federal Election Commission should have already done 
this. A federal district judge in Washington recently called for 
action, ruling that the Federal Election Commission had ``failed to 
present a reasoned explanation'' for not requiring 527 groups to 
register as political committees.
  H.R. 513 will close this FEC-created loophole that has allowed 527 
groups, of both parties, to spend hundreds of millions of dollars in 
unlimited soft money to influence presidential and congressional 
elections without complying with campaign finance laws.
  During the last election cycle, 527 groups raised $426 million. 
Likewise, much of the soft money came from a relatively small number of 
very wealthy individuals. According to campaign finance scholar Anthony 
Corrado, just 25 individuals accounted for $146 million raised by 
Democratic and Republican 527 groups that spent money to influence the 
2004 federal elections. And, we are already seeing an increase in the 
rate at which 527s are raising money this election cycle.
  If the primary role of 527 groups is to influence federal elections, 
which it clearly is, they must play by the same set of rules that apply 
to other political groups whose purpose is to spend money to influence 
federal elections. There should be no exception.
  At a time when the public is calling for transparency and 
accountability, no longer can we tolerate a loophole that allows this 
type of money from the wealthy few to unfairly influence the political 
process.
  If you voted for the Shays-Meehan/McCain-Feingold Bipartisan Campaign 
Finance Reform bill in 2002--and 240 of us did--it would be wholly out 
of step to not support H.R. 513.
  I urge all my colleagues to vote in favor of H.R. 513.
  Mr. HOLT. Mr. Speaker, I would like to commend the efforts of my 
colleagues Chris Shays and Marty Meehan to strengthen elections in this 
country. However, I oppose the measure they offer today because it 
seeks to address the wrong problem, and as a result, this proposal 
squelches participation by individuals and small donors in the 
electoral process. For that reason, and because there are First 
Amendment implications as well, I will vote against this measure.
  On my first day as a Member of Congress in 1999, I joined the fight 
for campaign finance reform. I did so because we needed to curtail the 
influence of money in politics. The Bipartisan Campaign Finance Reform 
Act (BCRA) was critical to that effort because it eliminated corporate 
money and capped the size of donations that could be made to political 
candidates and political parties. These steps made it less likely that 
elected officials will be beholden to large donors instead of to their 
constituents.
  The critical distinction between BCRA and the proposal before us 
today is that BCRA limited the amount of money that could go toward 
political candidates and parties. Today's proposal limits donations to 
organizations that advocate for a policy or a point of view. That is a 
radically different approach. Let's remember something: Elected 
officials are supposed to hear from their constituents at election 
time. A group of citizens speaking loudly through the collective action 
of a 527 is a democracy behaving as it should.
  Organizations that attain 527 status under the Internal Revenue Code 
are dedicated to specific ideals and legislative objectives that they 
believe are best for America. Some 527s want more investment in 
education. Some want lower taxes. Some support the right to choose. 
Others oppose it. None of these organizations, however, may be 
dedicated to a specific person or party. They may not advocate for or 
against a specific candidate, nor coordinate their activities with a 
candidate's campaign. By definition, their involvement is the stuff of 
political discourse.
  As a strong, early, and vocal supporter of the Bipartisan Campaign 
Finance Reform Act, I agree with the ban on raising and spending 
unregulated ``soft'' money by candidates and political parties. BCRA 
helps prevent elected Members of Congress from developing a ``second 
constituency,'' one that is different from their actual constituency, 
which is the people they represent. However, BCRA did not intend to 
prohibit robust debate of political ideals, values, and proposals for 
the betterment of our country. Doing so not only stifles political 
discourse, it runs afoul of the First Amendment right to speak freely. 
In February of 2004, I joined several of my colleagues in writing to 
the Federal Elections Commission (FEC) stating my view that while we 
need to break the link between unregulated contributions and federal 
officeholders, we need to protect, preserve, and even increase 
political involvement by ordinary citizens and independent 
associations.
  If this bill passes, it's important to note who would be affected. 
According to the Institute for Politics, Democracy and the Internet, 
527 fundraising and spending increased fourfold between 2000 and 2004, 
while at the same time, voter turnout reached an unprecedented high of 
almost 126 million voters in 2004--15 million more than in 2000. This 
was largely a direct result of voter registration, education, and 
mobilization activities organized by 527s. Most importantly, although 
it has been widely reported that certain wealthy individuals made 
multi-million dollar contributions to 527s, the vast majority of 527 
receipts were from individual donations of under $200. The liberal 527 
organization ``America Coming Together,'' for example, raised $80 
million in 2004, 80 percent of which was from donations of less than 
$200. Similarly, the conservative 527 organization ``Progress for 
America'' raised $45 million in 2004, 85 percent of which was from 
donations of less than $200.
  These statistics are in stark contrast to much of the debate on this 
issue. Supporters of the proposal before us today have pointed to 
wealthy individuals who contributed large sums to 527s as evidence that 
527s should be curtailed. My question is this: Even if this bill 
passes, what is to stop wealthy individuals from simply paying for the 
same television ads, mail pieces, and organizational efforts on their 
own, without 527s? If this bill passes, these same individuals will 
simply spend their money on their own. It is small donors--who, as I 
said already, are the majority of donors to 527s--who will be denied 
the benefit of collective action. Squelching 527s will not curb the 
involvement of wealthy individuals, it will simply make them towering 
figures on the playing field of public discourse. This is exactly the 
wrong outcome.
  If we want to tighten issue advocacy, we should do so by enforcing 
the already existing requirement that 527s remain truly independent of 
political candidates and parties. Truly independent 527 organizations 
expand the political debate, increase the public's opportunity to hold 
elected officials accountable, and increase participation in the 
political process by ordinary Americans.
  The SPEAKER pro tempore (Mr. LaHood). All time for debate has 
expired.
  Pursuant to House Resolution 755, the previous question is ordered on 
the bill, as amended.
  The question is on the engrossment and third reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Ms. MILLENDER-McDONALD. Mr. Speaker, I object to the vote on the 
ground that a quorum is not present and make the point of order that a 
quorum is not present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  Pursuant to clause 8 of rule XX, this 15-minute vote on the question 
of passage will be followed by 5-minute votes on House Resolution 692 
and H.R. 3127.
  The vote was taken by electronic device, and there were--yeas 218, 
nays 209, not voting 6, as follows:

                             [Roll No. 88]

                               YEAS--218

     Aderholt
     Akin
     Alexander
     Bachus
     Baker
     Baldwin
     Barrett (SC)
     Barton (TX)
     Bass
     Beauprez
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Boren
     Boustany
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burton (IN)
     Buyer
     Calvert
     Camp (MI)
     Campbell (CA)
     Cannon
     Cantor
     Capito
     Carter
     Case
     Castle
     Chabot
     Coble
     Cole (OK)
     Conaway
     Crenshaw
     Cubin
     Culberson
     Davis (KY)
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     Dent
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Drake
     Dreier
     Duncan
     Ehlers
     Emerson
     English (PA)
     Everett
     Feeney
     Ferguson
     Fitzpatrick (PA)
     Foley
     Forbes
     Fortenberry
     Foxx
     Frelinghuysen
     Gallegly
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Granger
     Graves
     Green (WI)
     Gutknecht
     Hall
     Harris
     Hart
     Hastert
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Herger
     Hobson
     Hostettler
     Hulshof
     Hunter
     Hyde
     Inglis (SC)
     Issa
     Jenkins
     Jindal
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Keller
     Kelly
     Kennedy (MN)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     Kuhl (NY)
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas

[[Page H1529]]


     Lungren, Daniel E.
     Maloney
     Manzullo
     Marchant
     McCaul (TX)
     McCotter
     McCrery
     McHenry
     McHugh
     McKeon
     Meehan
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Otter
     Oxley
     Pearce
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Poe
     Pombo
     Porter
     Price (GA)
     Pryce (OH)
     Putnam
     Radanovich
     Ramstad
     Regula
     Rehberg
     Reichert
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schmidt
     Schwarz (MI)
     Sensenbrenner
     Sessions
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (NJ)
     Smith (TX)
     Sodrel
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (MS)
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Turner
     Upton
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Wu
     Young (AK)
     Young (FL)

                               NAYS--209

     Abercrombie
     Ackerman
     Allen
     Andrews
     Baca
     Baird
     Barrow
     Bartlett (MD)
     Bean
     Becerra
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Butterfield
     Capps
     Capuano
     Cardin
     Cardoza
     Carnahan
     Carson
     Chandler
     Chocola
     Clay
     Cleaver
     Clyburn
     Conyers
     Cooper
     Costa
     Costello
     Cramer
     Crowley
     Cuellar
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (FL)
     Davis (IL)
     Davis (TN)
     DeFazio
     DeGette
     Delahunt
     DeLauro
     Dicks
     Dingell
     Doggett
     Doyle
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Farr
     Fattah
     Filner
     Flake
     Ford
     Fossella
     Frank (MA)
     Franks (AZ)
     Garrett (NJ)
     Gohmert
     Gonzalez
     Gordon
     Green, Al
     Green, Gene
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hensarling
     Herseth
     Higgins
     Hinchey
     Hinojosa
     Holden
     Holt
     Honda
     Hooley
     Hoyer
     Inslee
     Israel
     Istook
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Johnson, E. B.
     Jones (NC)
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick (MI)
     Kind
     King (IA)
     Kucinich
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren, Zoe
     Lowey
     Lynch
     Mack
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy
     McCollum (MN)
     McDermott
     McGovern
     McIntyre
     McKinney
     McMorris
     McNulty
     Meek (FL)
     Meeks (NY)
     Melancon
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore (KS)
     Moore (WI)
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Neugebauer
     Oberstar
     Obey
     Olver
     Ortiz
     Owens
     Pallone
     Pascrell
     Pastor
     Paul
     Payne
     Pelosi
     Pence
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Reyes
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Salazar
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Schiff
     Schwartz (PA)
     Scott (GA)
     Scott (VA)
     Serrano
     Shadegg
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Strickland
     Stupak
     Tauscher
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Wasserman Schultz
     Waters
     Watt
     Waxman
     Weiner
     Westmoreland
     Wexler
     Woolsey
     Wynn

                             NOT VOTING--6

     Evans
     Hoekstra
     Ros-Lehtinen
     Schakowsky
     Tanner
     Watson

                              {time}  1829

  Mr. WATT changed his vote from ``yea'' to ``nay.''
  Messrs. FORBES, OSBORNE, WELDON of Florida, MANZULLO, and POE changed 
their vote from ``nay'' to ``yea.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.

                          ____________________