[Congressional Record (Bound Edition), Volume 152 (2006), Part 4] [House] [Pages 4994-5010] [From the U.S. 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''. 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 [[Page 4995]] 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. (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, [[Page 4996]] 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. ``(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 [[Page 4997]] 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. (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 [[Page 4998]] 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. [[Page 4999]] 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 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, [[Page 5000]] 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 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 [[Page 5001]] 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 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. [[Page 5002]] 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. 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 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 [[Page 5003]] 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. {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 [[Page 5004]] 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. 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 [[Page 5005]] 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 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 [[Page 5006]] 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- 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 [[Page 5007]] 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. 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 [[Page 5008]] 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. 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. [[Page 5009]] 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. Ms. PRYCE of Ohio. Mr. Speaker, in 2002, after six years of debate, Congress passed the Bipartisan Campaign Finance Reform Act, better known as the McCain-Feingold bill. Supporters of the bill claimed it would rectify the perception that there is too much money in politics, and that tightening reporting requirements would create full transparency in donor information. But while their intentions were noble, 4 years later politics is more awash in money than ever before, only thanks to McCain-Feingold, we now know less about where it's coming from. According to the bill's proponents, the crown jewel of McCain- Feingold was a ban on large, unregulated contributions to political parties, known as ``soft money.'' In theory, this prohibition was supposed to prevent billionaires from donating enormous and largely unreported sums of cash to influence federal elections. In reality, it spawned a new, unaccountable funnel for millionaire money--527s. Although 527s can run political ads, mobilize voters, donate to Federal campaigns through an affiliated PAC, and perform virtually every other function of a political party, 527s--unlike candidate campaigns, political parties, and political action committees--are not regulated by the Federal Elections Commission. Nor are 527s accountable to voters. 527s have carried their message into the homes of millions of Americans without having to adhere to the numerous regulations governing political parties and campaigns. The bill before us today--the 527 Reform Act--will close this loophole in McCain-Feingold, preventing 527s from having an unfair financial advantage over political parties and individual candidates. At bottom, this is simply a matter of fairness: everyone who seeks to influence a federal election should be playing by the same rules. Mr. Speaker, when we passed the Bipartisan Campaign Finance Reform Act, the other side said millionaires were playing too big of a role in federal elections. If they truly believe that, I challenge them to support this legislation and restore fairness to campaign finance laws. Ms. McCOLLUM of Minnesota. Mr. Speaker, I rise today in opposition to the so-called 527 Reform Act of 2005 (H.R. 513). This legislation singles out 527 organizations in an effort to undermine their fundraising and is a direct assault on free speech. This legislation would change the Federal Election Campaign Act of 1971 (FECA) to add 527 organizations in the definition of political committee. If enacted, this bill would suppress free speech and obstruct the efforts of grassroots organizations to encourage voter participation while doing nothing to address the culture of corruption in Congress. I support the Bipartisan Campaign Reform Act (BCRA) of 2002, which established balanced and effective strategies to achieve fairer elections. H.R. 513 is an unbalanced measure that favors corporate trade associations over independent advocates. For example, the bill would provide an unfair advantage to corporate interests by allowing them to continue spending unlimited and undisclosed dollars for political purposes while subjecting independent organizations, like citizens joining together to promote voter registration, to contribution limits and source restrictions. H.R. 513 also removes all limits on national and state party spending for Congressional candidates in primary or general elections. This section of the bill is an unmasked attack on BCRA and clear evidence of the majority party's true intentions in advancing H.R. 513. The goal is not reform, but partisan advantage in political fundraising. If we are serious about reform, there are several Democratic proposals that have been put forward to address the real problems facing this Congress. We should be reforming the Rules of the House in order to provide Members adequate time to review legislation before a vote. We should also be addressing the practice of travel on corporate jets and disclosure of fundraising by lobbyists. Unfortunately, the Republicans will not allow a real, comprehensive debate on this critical issue. H.R. 513 is the majority party's cynical and underwhelming response and is clearly meant to distract attention from the real problems of corruption. I urge my colleagues to reject this bill and vote for a real package of reforms--changes that Congress needs and that Americans expect. 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 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) [[Page 5010]] 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. ____________________