[Congressional Record (Bound Edition), Volume 156 (2010), Part 12]
[House]
[Pages 16863-16865]
[From the U.S. Government Publishing Office, www.gpo.gov]




                STATE ETHICS LAW PROTECTION ACT OF 2010

  Mr. OBERSTAR. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 3427) to amend title 23, United States Code, to protect 
States that have in effect laws or orders with respect to pay to play 
reform, and for other purposes, as amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 3427

       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 ``State Ethics Law Protection 
     Act of 2010''.

     SEC. 2. PAY TO PLAY REFORM.

       Section 112 of title 23, United States Code, is amended by 
     adding at the end the following:
       ``(h) Pay To Play Reform.--A State transportation 
     department shall not be considered to have violated a 
     requirement of this section solely because the State in which 
     that State transportation department is located, or a local 
     government within that State, has in effect a law or an order 
     that limits the amount of money an individual or entity that 
     is doing business with a State or local agency with respect 
     to a Federal-aid highway project may contribute to a 
     political party, campaign, or elected official.''.

  The SPEAKER pro tempore. Pursuant to the rule, the gentleman from 
Minnesota (Mr. Oberstar) and the gentleman from New Jersey (Mr. 
LoBiondo) each will control 20 minutes.
  The Chair recognizes the gentleman from Minnesota.
  Mr. OBERSTAR. Mr. Speaker, I yield such as he may consume to the 
gentleman from Illinois (Mr. Quigley).
  Mr. QUIGLEY. Mr. Speaker, now more than ever, we must use every tool 
at our disposal to fight corruption. My home State of Illinois has made 
headlines time and again with charges of cronyism, corruption, and 
waste. Many of these charges involved pay-to-play politics, trading 
campaign contributions for government contracts.
  In 2008, the Illinois General Assembly took a bipartisan stand by 
passing a

[[Page 16864]]

bill to eliminate pay-to-play contracting. Amazingly, the Federal 
Government then told Illinois that it had to back down or risk losing 
highway funds. The Federal Highway Administration interpreted their 
competitive bidding requirements to mean that States couldn't weed out 
corrupt contractors. Clearly that wasn't the intent of this Chamber 
when it passed those requirements. That is why I am pleased we are 
debating this important fix.
  H.R. 3427, the State Ethics Law Protection Act, will make it clear 
that Congress supports the right of States to fight corruption. States 
like Connecticut, New Jersey, South Carolina, Pennsylvania, and 
Kentucky have passed laws like Illinois', and others are debating 
similar bills. They are all arriving at the same bipartisan conclusion: 
Corruption must be stamped out and pay-to-play made a thing of the 
past. Our States have shown they are ready for reform. It is now our 
duty to ensure they have the ability to do so.
  At this critical juncture, we must do all we can to inspire the trust 
and confidence of people across the country. After all, without the 
people's trust, we cannot govern. I wish to thank Chairman Oberstar and 
the committee for bringing this bill to the floor and urge my 
colleagues to support the State Ethics Law Protection Act.
  Mr. LoBIONDO. Mr. Speaker, I yield myself such time as I may consume.
  This is a commonsense good government bill which I support.
  I yield back the balance of my time.
  Mr. OBERSTAR. Mr. Speaker, I yield myself such time as I may consume.
  The gentleman from Illinois stated the case very clearly and 
thoughtfully, and the gentleman from New Jersey has further underscored 
the significance of this bill. This legislation makes clear that no 
State will be considered to have violated the Federal Highway 
Administration's competitive bidding requirements solely because the 
State chose to enact an anti-pay-to-play law. The bill would neither 
require a State to pass anti-pay-to-play nor prohibit a State from 
doing so. It would not weigh in on the merits of any existing State 
law. It simply removes what currently functions as a Federal 
prohibition on some States' efforts to prohibit pay-to-play. As the 
gentleman from New Jersey said, it is commonsense legislation, and I 
urge its passage.
  Mr. Speaker, I rise today in strong support of H.R. 3427, as amended, 
the ``State Ethics Law Protection Act of 2010'', introduced by the 
gentleman from Illinois (Mr. Quigley).
  This bill aids State efforts to clean up their procurement processes 
by removing the threat of the loss of Federal-aid highway funds if a 
State chooses to enact ``anti-pay-to-play'' reforms.
  Specifically, H.R. 3427 provides that a State may not be considered 
to have violated the Federal Highway Administration's (FHWA) 
competitive bidding requirements solely because of the enactment of a 
State or local law prohibiting ``pay-to-play''.
  In an effort to improve State procurement processes, many States have 
enacted anti-pay-to-play laws that limit the amount of money that an 
individual or entity doing business with a State agency may contribute 
to a political party, campaign, or elected official.
  Unfortunately, FHWA has interpreted State anti-pay-to-play laws as 
potentially conflicting with the competitive bidding requirements that 
apply to the use of Federal-aid highway funds under title 23 of the 
United States Code.
  As a result of this statutory requirement, FHWA has twice threatened 
to withhold Federal highway funds from States that enacted anti-pay-to-
play laws that applied to contracts on Federal-aid highway projects. 
The first instance occurred in 2004 in New Jersey. The second occurred 
last year in Illinois.
  The competitive bidding requirements of title 23 are designed to 
ensure that the lowest qualified bidder is awarded Federal-aid highway 
contracts. They are not designed to prevent States from conducting 
procurement under the highest ethical standards. Unfortunately, in some 
instances, they have had just this effect.
  H.R. 3427 addresses this situation by making it clear that no State 
will be considered to have violated FHWA competitive bidding 
requirements solely because the State chose to enact an anti-pay-to-
play law.
  This bill would neither require any State to pass an ``anti-pay-to-
play'' law nor prohibit it from doing so. It would not weigh in on the 
merits of any existing State law. It would simply remove what currently 
functions as a Federal prohibition on some States' efforts to prohibit 
``pay-to-play''.
  I urge my colleagues to join me in supporting H.R. 3427.
  Mr. FOSTER. Mr. Speaker, I rise today in strong support of H.R. 3427, 
the State Ethics Law Protection Act of 2009. This simple bill goes a 
long way in closing a loophole that discourages states from enacting 
tough pay-to-play reforms.
  Under current policy, states like Illinois that take a stand against 
corrupt practices by prohibiting the awarding of highway contracts to 
campaign contributors may jeopardize a share of their highway funding. 
In 2008, when a tough pay-to-play law was being considered in Illinois, 
the Federal Highway Administration intervened and threatened to 
withhold Federal dollars if the law was enacted.
  The shameful and unethical string of crimes perpetrated by public 
officials in the State of Illinois is by now well known, but the FHWA's 
intervention led the General Assembly to water down what would have 
been a tough and effective anti-corruption law. What's more, the FHWA's 
application of this policy has been occasional and uneven. Of the eight 
states that have enacted pay-to-play legislation, only New Jersey and 
Illinois have been singled out.
  H.R. 3427 will untie the hands of state legislatures that seek to 
take bold action to combat pay-to-play practices and restore the 
public's faith in government. It will also help ensure that federal 
dollars will not be wasted on contracts doled out to political cronies.
  I urge my colleagues to support this important bill, which will help 
state legislatures hold the line against corruption.
  Mr. QUIGLEY. Mr. Speaker, I am pleased that we are considering this 
legislation to clarify the language of Section 112 of title 23, United 
States Code to reaffirm the intent of Congress that Section 112 does 
not bar enforcement of State and local ordinances and contracting 
policies, in connection with Federal-aid highway projects, that 
disadvantage or disqualify classes of contractors. The Secretary 
properly enjoys discretion to approve contract requirements, consistent 
with the Federal-Aid Highway Act, 23 U.S.C. Sec. 101, et seq.
  Possible ambiguity in Section 112 has come to the Congress's 
attention in light of recent State and local efforts to combat 
corruption and favoritism in contracting. States, local jurisdictions, 
and the Securities and Exchange Commission have enacted ``pay-to-play'' 
restrictions that disqualify contractors who make campaign 
contributions to officials responsible for government contracts. 
Concerns have been raised that application of Section 112 may limit the 
discretion of FHWA to approve Federal-aid highway projects subject to 
State pay-to-play policies. Accordingly, the FHWA temporarily withheld 
federal highway funds from the States of New Jersey and Illinois.
  The soundness of these concerns has been called into question by the 
United States Court of Appeals for the Sixth Circuit in City of 
Cleveland v. State of Ohio, 508 F.3d 827 (6th Cir. 2007), and, in any 
event, these concerns misunderstand Congress's long-standing intent 
regarding the operation of the current laws governing Federal-aid 
highway projects. Section 17 of the Federal-Aid Highway Act of 1954, 
which is codified at Section 112 of title 23, United States Code, 
imposes a requirement on FHWA to ensure that government contractors are 
selected through a competitive bidding process. This competitive 
bidding requirement was ``designed to prohibit collusion or action in 
restraint of free competitive bidding in connection with the 
contract.'' S. Rep. 83-1093 (1954) at 14. The enactment of Section 112, 
however, was not intended to ``add to or otherwise affect the powers of 
the Secretary [of Transportation] . . . with respect to the selection 
of projects.'' Id. Subsequent amendments have not altered that purpose.
  The language of this legislation simply makes clear that it has 
always been Congress's intent that the Secretary may concur in the 
award of a Federal-aid highway contract despite a State or local 
requirement, imposed by law or through contract, disqualifying 
contractors on the basis of the amount of money contributed to a 
political campaign. To be clear, the enactment of this legislation 
would not be construed to mean that existing law would have foreclosed 
the application of State pay-to-play restrictions, or similarly 
situated provisions, to highway projects supported by Federal funds.
  This bill will dispel any misunderstandings about the application of 
State pay-to-play restrictions and similar policies to Federal-aid 
highway projects. It will have an immediate, positive effect for local 
and State governments determined to implement pay-to-play restrictions 
to combat corruption and favoritism.

[[Page 16865]]

  I urge my colleagues to join me in supporting H.R. 3427.
  Mr. OBERSTAR. I yield back the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentleman from Minnesota (Mr. Oberstar) that the House suspend the 
rules and pass the bill, H.R. 3427, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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