[Congressional Record (Bound Edition), Volume 146 (2000), Part 7]
[Senate]
[Page 10182]
[From the U.S. Government Publishing Office, www.gpo.gov]



           MANDATING DISCLOSURE BY SECTION 527 ORGANIZATIONS

  Mr. REED. Mr. President, first, I commend Senators Lieberman, McCain, 
Feingold, Daschle and Levin for all of their hard work on the issue of 
Section 527 organizations. This latest mutation in fundraising is just 
another example of the failure of our existing campaign finance laws.
  Hopefully, the passage of our amendment yesterday, which mandates 
disclosure by Section 527 organizations, will close yet another legal 
loophole being exploited by clever campaign fundraisers. This amendment 
should make unregulated and unlimited contributions to these so-called 
Section 527 committees much less attractive. Although donors will be 
able to continue to make as many tax-deductible contributions as they 
want, they will no longer be able to do so in absolute secrecy.
  These Section 527 organizations, named after a section of the tax 
code, skirt existing campaign finance laws by carefully avoiding the 
endorsement of any particular candidate. This convoluted reasoning 
proceeds as follows: if a Section 527 committee does not endorse a 
particular candidate, then it is not engaged in political activity; if 
it is not engaged in political activity, then there is no requirement 
for it to disclose who has contributed money to the committee; since it 
is not engaged in political activity, it can run unlimited issue ads 
without obeying existing campaign finance laws regarding disclosure.
  We all know from past experience that it is just a matter of time 
before enormous amounts of campaign cash are funneled through more and 
more of these secret organizations. The amendment which passed 
yesterday, which I was pleased to cosponsor, will force Section 527 
organizations to emerge from the shadows. They will be required to 
disclose their existence to the IRS, file publicly available tax 
returns, make public reports specifying annual expenditures over $500, 
and identify those making contributions of $200 or more a year to the 
organization.
  Although disclosure is only part of the solution, the passage of this 
amendment ensures that the public understands who these committees are, 
who gives them their money, and how they spend that money. I was 
pleased to give it my support.

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