Division B — Campaign Finance

H.R. 1612 · 116th Congress · Mar 7, 2019 · Lineage

B Campaign Finance

IV Campaign Finance Transparency

A Findings Relating to Illicit Money Undermining Our Democracy

Sec. 4001 Findings relating to illicit money undermining our democracy

Congress finds the following:

(1)

Criminals, terrorists, and corrupt government officials frequently abuse anonymously held limited liability companies (LLCs), also known as “shell companies”, to hide, move, and launder the dirty money derived from illicit activities such as trafficking, bribery, exploitation, and embezzlement. Ownership and control of the finances that run through shell companies are obscured to regulators and law enforcement because little information is required and collected when establishing these entities.

(2)

The public release of the “Panama Papers” in 2016 and the “Paradise Papers” in 2017 revealed that these shell companies often purchase and sell United States real estate. United States anti-money laundering laws do not apply to cash transactions involving real estate effectively concealing the beneficiaries and transactions from regulators and law enforcement.

(3)

Congress should curb the use of anonymous shell companies for illicit purposes by requiring United States companies to disclose their beneficial owners, strengthening anti-money laundering and counter-terrorism finance laws.

(4)

Congress should examine the money laundering and terrorist financing risks in the real estate market, including the role of anonymous parties, and review legislation to address any vulnerabilities identified in this sector.

(5)

Congress should examine the methods by which corruption flourishes and the means to detect and deter the financial misconduct that fuels this driver of global instability. Congress should monitor government efforts to enforce United States anti-corruption laws and regulations.

B DISCLOSE Act

Sec. 4100 Short title

This subtitle may be cited as the “Democracy Is Strengthened by Casting Light On Spending in Elections Act of 2019” or the “DISCLOSE Act of 2019”.

1 Regulation of Certain Political Spending

Sec. 4101 Application of ban on contributions and expenditures by foreign nationals to domestic corporations, limited liability corporations, and partnerships that are foreign-controlled, foreign-influenced, and foreign-owned

(a)

Application of ban— Section 319(b) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(b)) is amended—

(1)

by striking “or” at the end of paragraph (1);

(2)

by striking the period at the end of paragraph (2) and inserting “; or”; and

(3)

by adding at the end the following new paragraph:

“(3) any corporation, limited liability corporation, or partnership which is not a foreign national described in paragraph (1) and—

“(A) in which a foreign national described in paragraph (1) or (2) directly or indirectly owns or controls—

“(i) 5 percent or more of the voting shares, if the foreign national is a foreign country, a foreign government official, or a corporation principally owned or controlled by a foreign country or foreign government official; or

“(ii) 20 percent or more of the voting shares, if the foreign national is not described in clause (i);

“(B) in which two or more foreign nationals described in paragraph (1) or (2), each of whom owns or controls at least 5 percent of the voting shares, directly or indirectly own or control 50 percent or more of the voting shares;

“(C) over which one or more foreign nationals described in paragraph (1) or (2) has the power to direct, dictate, or control the decisionmaking process of the corporation, limited liability corporation, or partnership with respect to its interests in the United States; or

“(D) over which one or more foreign nationals described in paragraph (1) or (2) has the power to direct, dictate, or control the decisionmaking process of the corporation, limited liability corporation, or partnership with respect to activities in connection with a Federal, State, or local election, including—

“(i) the making of a contribution, donation, expenditure, independent expenditure, or disbursement for an electioneering communication (within the meaning of section 304(f)(3)); or

“(ii) the administration of a political committee established or maintained by the corporation.”

(b)

Certification of Compliance— Section 319 of such Act (52 U.S.C. 30121) is amended by adding at the end the following new subsection:

“(c) Certification of compliance required prior To carrying out activity—Prior to the making in connection with an election for Federal office of any contribution, donation, expenditure, independent expenditure, or disbursement for an electioneering communication by a corporation, limited liability corporation, or partnership during a year, the chief executive officer of the corporation, limited liability corporation, or partnership (or, if the corporation, limited liability corporation, or partnership does not have a chief executive officer, the highest ranking official of the corporation, limited liability corporation, or partnership), shall file a certification with the Commission, under penalty of perjury, that the corporation, limited liability corporation, or partnership is not prohibited from carrying out such activity under subsection (b)(3), unless the chief executive officer has previously filed such a certification during that calendar year.”

(c)

Effective date— The amendments made by this section shall take effect upon the expiration of the 180-day period which begins on the date of the enactment of this Act, and shall take effect without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments.

Sec. 4102 Clarification of application of foreign money ban to certain disbursements and activities

(a)

Application to disbursements to Super PACs— Section 319(a)(1)(A) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(a)(1)(A)) is amended by striking the semicolon and inserting the following: “, including any disbursement to a political committee which accepts donations or contributions that do not comply with the limitations, prohibitions, and reporting requirements of this Act (or any disbursement to or on behalf of any account of a political committee which is established for the purpose of accepting such donations or contributions);”.

(b)

Conditions under which corporate PACs may make contributions and expenditures— Section 316(b) of such Act (52 U.S.C. 30118(b)) is amended by adding at the end the following new paragraph:

“(8) A separate segregated fund established by a corporation may not make a contribution or expenditure during a year unless the fund has certified to the Commission the following during the year:

“(A) Each individual who manages the fund, and who is responsible for exercising decisionmaking authority for the fund, is a citizen of the United States or is lawfully admitted for permanent residence in the United States.

“(B) No foreign national under section 319 participates in any way in the decisionmaking processes of the fund with regard to contributions or expenditures under this Act.

“(C) The fund does not solicit or accept recommendations from any foreign national under section 319 with respect to the contributions or expenditures made by the fund.

“(D) Any member of the board of directors of the corporation who is a foreign national under section 319 abstains from voting on matters concerning the fund or its activities.”

2 Reporting of Campaign-Related Disbursements

Sec. 4111 Reporting of campaign-related disbursements

(a)

Disclosure requirements for corporations, labor organizations, and certain other entities—

(1)

In general— Section 324 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30126) is amended to read as follows:

“324. Disclosure of campaign-related disbursements by covered organizations

“(a) Disclosure statement

“(1) In general—Any covered organization that makes campaign-related disbursements aggregating more than $10,000 in an election reporting cycle shall, not later than 24 hours after each disclosure date, file a statement with the Commission made under penalty of perjury that contains the information described in paragraph (2)—

“(A) in the case of the first statement filed under this subsection, for the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the first such disclosure date) and ending on the first such disclosure date; and

“(B) in the case of any subsequent statement filed under this subsection, for the period beginning on the previous disclosure date and ending on such disclosure date.

“(2) Information described—The information described in this paragraph is as follows:

“(A) The name of the covered organization and the principal place of business of such organization and, in the case of a covered organization that is a corporation (other than a business concern that is an issuer of a class of securities registered under section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 78l) or that is required to file reports under section 15(d) of that Act (15 U.S.C. 78o(d))) or an entity described in subsection (e)(2), a list of the beneficial owners (as defined in paragraph (4)(A)) of the entity that—

“(i) identifies each beneficial owner by name and current residential or business street address; and

“(ii) if any beneficial owner exercises control over the entity through another legal entity, such as a corporation, partnership, limited liability company, or trust, identifies each such other legal entity and each such beneficial owner who will use that other entity to exercise control over the entity.

“(B) The amount of each campaign-related disbursement made by such organization during the period covered by the statement of more than $1,000, and the name and address of the person to whom the disbursement was made.

“(C) In the case of a campaign-related disbursement that is not a covered transfer, the election to which the campaign-related disbursement pertains and if the disbursement is made for a public communication, the name of any candidate identified in such communication and whether such communication is in support of or in opposition to a candidate.

“(D) A certification by the chief executive officer or person who is the head of the covered organization that the campaign-related disbursement is not made in cooperation, consultation, or concert with or at the request or suggestion of a candidate, authorized committee, or agent of a candidate, political party, or agent of a political party.

“(E)

“(i) If the covered organization makes campaign-related disbursements using exclusively funds in a segregated bank account consisting of funds that were paid directly to such account by persons other than the covered organization that controls the account, for each such payment to the account—

“(I) the name and address of each person who made such payment during the period covered by the statement;

“(II) the date and amount of such payment; and

“(III) the aggregate amount of all such payments made by the person during the period beginning on the first day of the election reporting cycle (or, if earlier, the period beginning one year before the disclosure date) and ending on the disclosure date,

“(ii) In any calendar year after 2020, section 315(c)(1)(B) shall apply to the amount described in clause (i) in the same manner as such section applies to the limitations established under subsections (a)(1)(A), (a)(1)(B), (a)(3), and (h) of such section, except that for purposes of applying such section to the amounts described in subsection (b), the “base period” shall be 2020.

“(F)

“(i) If the covered organization makes campaign-related disbursements using funds other than funds in a segregated bank account described in subparagraph (E), for each payment to the covered organization—

“(I) the name and address of each person who made such payment during the period covered by the statement;

“(II) the date and amount of such payment; and

“(G) Such other information as required in rules established by the Commission to promote the purposes of this section.

“(3) Exceptions

“(A) Amounts received in ordinary course of business—The requirement to include in a statement filed under paragraph (1) the information described in paragraph (2) shall not apply to amounts received by the covered organization in commercial transactions in the ordinary course of any trade or business conducted by the covered organization or in the form of investments (other than investments by the principal shareholder in a limited liability corporation) in the covered organization.

“(B) Donor restriction on use of funds—The requirement to include in a statement submitted under paragraph (1) the information described in subparagraph (F) of paragraph (2) shall not apply if—

“(i) the person described in such subparagraph prohibited, in writing, the use of the payment made by such person for campaign-related disbursements; and

“(ii) the covered organization agreed to follow the prohibition and deposited the payment in an account which is segregated from any account used to make campaign-related disbursements.

“(C) Amounts received from affiliates—The requirement to include in a statement submitted under paragraph (1) the information described in subparagraph (F) of paragraph (2) shall not apply to any amount which is described in subsection (f)(3).

“(D) Threat of harassment or reprisal—The requirement to include any information relating to the name or address of any person (other than a candidate) in a statement submitted under paragraph (1) shall not apply if the inclusion of the information would subject the person to serious threats, harassment, or reprisals.

“(4) Other definitions—For purposes of this section:

“(A) Beneficial owner defined

“(i) In general—Except as provided in clause (ii), the term beneficial owner means, with respect to any entity, a natural person who, directly or indirectly—

“(I) exercises substantial control over an entity through ownership, voting rights, agreement, or otherwise; or

“(II) has a substantial interest in or receives substantial economic benefits from the assets of an entity.

“(ii) Exceptions—The term beneficial owner shall not include—

“(I) a minor child;

“(II) a person acting as a nominee, intermediary, custodian, or agent on behalf of another person;

“(III) a person acting solely as an employee of an entity and whose control over or economic benefits from the entity derives solely from the employment status of the person;

“(IV) a person whose only interest in an entity is through a right of inheritance, unless the person also meets the requirements of clause (i); or

“(V) a creditor of an entity, unless the creditor also meets the requirements of clause (i).

“(iii) Anti-abuse rule—The exceptions under clause (ii) shall not apply if used for the purpose of evading, circumventing, or abusing the provisions of clause (i) or paragraph (2)(A).

“(B) Disclosure date—The term disclosure date means—

“(i) the first date during any election reporting cycle by which a person has made campaign-related disbursements aggregating more than $10,000; and

“(ii) any other date during such election reporting cycle by which a person has made campaign-related disbursements aggregating more than $10,000 since the most recent disclosure date for such election reporting cycle.

“(C) Election reporting cycle—The term election reporting cycle means the 2-year period beginning on the date of the most recent general election for Federal office.

“(D) Payment—The term payment includes any contribution, donation, transfer, payment of dues, or other payment.

“(b) Coordination with other provisions

“(1) Other reports filed with the Commission—Information included in a statement filed under this section may be excluded from statements and reports filed under section 304.

“(2) Treatment as separate segregated fund—A segregated bank account referred to in subsection (a)(2)(E) may be treated as a separate segregated fund for purposes of section 527(f)(3) of the Internal Revenue Code of 1986.

“(c) Filing—Statements required to be filed under subsection (a) shall be subject to the requirements of section 304(d) to the same extent and in the same manner as if such reports had been required under subsection (c) or (g) of section 304.

“(d) Campaign-Related disbursement defined

“(1) In general—In this section, the term campaign-related disbursement means a disbursement by a covered organization for any of the following:

“(A) An independent expenditure which expressly advocates the election or defeat of a clearly identified candidate for election for Federal office, or is the functional equivalent of express advocacy because, when taken as a whole, it can be interpreted by a reasonable person only as advocating the election or defeat of a candidate for election for Federal office.

“(B) Any public communication which refers to a clearly identified candidate for election for Federal office and which promotes or supports a candidate for that office, or attacks or opposes a candidate for that office, without regard to whether the communication expressly advocates a vote for or against a candidate for that office.

“(C) An electioneering communication, as defined in section 304(f)(3).

“(D) A covered transfer.

“(2) Intent not required—A disbursement for an item described in subparagraph (A), (B), (C), or (D) of paragraph (1) shall be treated as a campaign-related disbursement regardless of the intent of the person making the disbursement.

“(e) Covered organization defined—In this section, the term covered organization means any of the following:

“(1) A corporation (other than an organization described in section 501(c)(3) of the Internal Revenue Code of 1986).

“(2) A limited liability corporation that is not otherwise treated as a corporation for purposes of this Act (other than an organization described in section 501(c)(3) of the Internal Revenue Code of 1986).

“(3) An organization described in section 501(c) of such Code and exempt from taxation under section 501(a) of such Code (other than an organization described in section 501(c)(3) of such Code).

“(4) A labor organization (as defined in section 316(b)).

“(5) Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act (except as provided in paragraph (6)).

“(6) A political committee with an account that accepts donations or contributions that do not comply with the contribution limits or source prohibitions under this Act, but only with respect to such accounts.

“(f) Covered transfer defined

“(1) In general—In this section, the term covered transfer means any transfer or payment of funds by a covered organization to another person if the covered organization—

“(A) designates, requests, or suggests that the amounts be used for—

“(i) campaign-related disbursements (other than covered transfers); or

“(ii) making a transfer to another person for the purpose of making or paying for such campaign-related disbursements;

“(B) made such transfer or payment in response to a solicitation or other request for a donation or payment for—

“(i) the making of or paying for campaign-related disbursements (other than covered transfers); or

“(ii) making a transfer to another person for the purpose of making or paying for such campaign-related disbursements;

“(C) engaged in discussions with the recipient of the transfer or payment regarding—

“(i) the making of or paying for campaign-related disbursements (other than covered transfers); or

“(ii) donating or transferring any amount of such transfer or payment to another person for the purpose of making or paying for such campaign-related disbursements;

“(D) made campaign-related disbursements (other than a covered transfer) in an aggregate amount of $50,000 or more during the 2-year period ending on the date of the transfer or payment, or knew or had reason to know that the person receiving the transfer or payment made such disbursements in such an aggregate amount during that 2-year period; or

“(E) knew or had reason to know that the person receiving the transfer or payment would make campaign-related disbursements in an aggregate amount of $50,000 or more during the 2-year period beginning on the date of the transfer or payment.

“(2) Exclusions—The term covered transfer does not include any of the following:

“(A) A disbursement made by a covered organization in a commercial transaction in the ordinary course of any trade or business conducted by the covered organization or in the form of investments made by the covered organization.

“(B) A disbursement made by a covered organization if—

“(i) the covered organization prohibited, in writing, the use of such disbursement for campaign-related disbursements; and

“(ii) the recipient of the disbursement agreed to follow the prohibition and deposited the disbursement in an account which is segregated from any account used to make campaign-related disbursements.

“(3) Special rule regarding transfers among affiliates

“(A) Special rule—A transfer of an amount by one covered organization to another covered organization which is treated as a transfer between affiliates under subparagraph (C) shall be considered a covered transfer by the covered organization which transfers the amount only if the aggregate amount transferred during the year by such covered organization to that same covered organization is equal to or greater than $50,000.

“(B) Determination of amount of certain payments among affiliates—In determining the amount of a transfer between affiliates for purposes of subparagraph (A), to the extent that the transfer consists of funds attributable to dues, fees, or assessments which are paid by individuals on a regular, periodic basis in accordance with a per-individual calculation which is made on a regular basis, the transfer shall be attributed to the individuals paying the dues, fees, or assessments and shall not be attributed to the covered organization.

“(C) Description of transfers between affiliates—A transfer of amounts from one covered organization to another covered organization shall be treated as a transfer between affiliates if—

“(i) one of the organizations is an affiliate of the other organization; or

“(ii) each of the organizations is an affiliate of the same organization,

“(D) Determination of affiliate status—For purposes of subparagraph (C), a covered organization is an affiliate of another covered organization if—

“(i) the governing instrument of the organization requires it to be bound by decisions of the other organization;

“(ii) the governing board of the organization includes persons who are specifically designated representatives of the other organization or are members of the governing board, officers, or paid executive staff members of the other organization, or whose service on the governing board is contingent upon the approval of the other organization; or

“(iii) the organization is chartered by the other organization.

“(E) Coverage of transfers to affiliated section 501(c)(3) organizations—This paragraph shall apply with respect to an amount transferred by a covered organization to an organization described in paragraph (3) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code in the same manner as this paragraph applies to an amount transferred by a covered organization to another covered organization.

“(g) No effect on other reporting requirements—Nothing in this section shall be construed to waive or otherwise affect any other requirement of this Act which relates to the reporting of campaign-related disbursements.”

(2)

Conforming amendment— Section 304(f)(6) of such Act (52 U.S.C. 30104) is amended by striking “Any requirement” and inserting “Except as provided in section 324(b), any requirement”.

(b)

Coordination with FinCEN—

(1)

In general— The Director of the Financial Crimes Enforcement Network of the Department of the Treasury shall provide the Federal Election Commission with such information as necessary to assist in administering and enforcing section 324 of the Federal Election Campaign Act of 1971, as added by this section.

(2)

Report— Not later than 6 months after the date of the enactment of this Act, the Chairman of the Federal Election Commission, in consultation with the Director of the Financial Crimes Enforcement Network of the Department of the Treasury, shall submit to Congress a report with recommendations for providing further legislative authority to assist in the administration and enforcement of such section 324.

Sec. 4112 Application of foreign money ban to disbursements for campaign-related disbursements consisting of covered transfers

Section 319(a)(1)(A) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121(a)(1)(A)), as amended by section 4102, is amended by striking the semicolon and inserting the following: “, and any disbursement to another person who made a campaign-related disbursement consisting of a covered transfer (as described in section 324) during the 2-year period ending on the date of the disbursement;”.

Sec. 4113 Effective date

The amendments made by this part shall apply with respect to disbursements made on or after January 1, 2020, and shall take effect without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments.

3 Other Administrative Reforms

Sec. 4121 Petition for certiorari

Section 307(a)(6) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30107(a)(6)) is amended by inserting “(including a proceeding before the Supreme Court on certiorari)” after “appeal”.

Sec. 4122 Judicial review of actions related to campaign finance laws

(a)

In general— Title IV of the Federal Election Campaign Act of 1971 (52 U.S.C. 30141 et seq.) is amended by inserting after section 406 the following new section:

“407. Judicial review

“(a) In general—Notwithstanding section 373(f), if any action is brought for declaratory or injunctive relief to challenge the constitutionality of any provision of this Act or of chapter 95 or 96 of the Internal Revenue Code of 1986, or is brought to with respect to any action of the Commission under chapter 95 or 96 of the Internal Revenue Code of 1986, the following rules shall apply:

“(1) The action shall be filed in the United States District Court for the District of Columbia and an appeal from the decision of the district court may be taken to the Court of Appeals for the District of Columbia Circuit.

“(2) In the case of an action relating to declaratory or injunctive relief to challenge the constitutionality of a provision—

“(A) a copy of the complaint shall be delivered promptly to the Clerk of the House of Representatives and the Secretary of the Senate; and

“(B) it shall be the duty of the United States District Court for the District of Columbia, the Court of Appeals 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 chapter 95 or 96 of the Internal Revenue Code of 1986 is raised, any Member of the House of Representatives (including a Delegate or Resident Commissioner to the 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. 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 interveners 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 chapter 95 or 96 of the Internal Revenue Code of 1986.”

(b)

Conforming amendments—

(1)

In general—

(A)

Section 9011 of the Internal Revenue Code of 1986 is amended to read as follows:

“9011. Judicial review

“For provisions relating to judicial review of certifications, determinations, and actions by the Commission under this chapter, see section 407 of the Federal Election Campaign Act of 1971.”

(B)

Section 9041 of the Internal Revenue Code of 1986 is amended to read as follows:

“9041. Judicial review

“For provisions relating to judicial review of actions by the Commission under this chapter, see section 407 of the Federal Election Campaign Act of 1971.”

(C)

Section 403 of the Bipartisan Campaign Reform Act of 2002 (52 U.S.C. 30110 note) is repealed.

(c)

Effective date— The amendments made by this section shall apply to actions brought on or after January 1, 2019.

C Honest Ads

Sec. 4201 Short title

This subtitle may be cited as the “Honest Ads Act”.

Sec. 4202 Purpose

The purpose of this subtitle is to enhance the integrity of American democracy and national security by improving disclosure requirements for online political advertisements in order to uphold the Supreme Court’s well-established standard that the electorate bears the right to be fully informed.

Sec. 4203 Findings

Congress makes the following findings:

(1)

On January 6, 2017, the Office of the Director of National Intelligence published a report titled “Assessing Russian Activities and Intentions in Recent U.S. Elections”, noting that “Russian President Vladimir Putin ordered an influence campaign in 2016 aimed at the US presidential election . . . ”. Moscow’s influence campaign followed a Russian messaging strategy that blends covert intelligence operation—such as cyber activity—with overt efforts by Russian Government agencies, state-funded media, third-party intermediaries, and paid social media users or “trolls”.

(2)

On November 24, 2016, The Washington Post reported findings from 2 teams of independent researchers that concluded Russians “exploited American-made technology platforms to attack U.S. democracy at a particularly vulnerable moment . . . as part of a broadly effective strategy of sowing distrust in U.S. democracy and its leaders.”.

(3)

Findings from a 2017 study on the manipulation of public opinion through social media conducted by the Computational Propaganda Research Project at the Oxford Internet Institute found that the Kremlin is using pro-Russian bots to manipulate public discourse to a highly targeted audience. With a sample of nearly 1,300,000 tweets, researchers found that in the 2016 election’s 3 decisive States, propaganda constituted 40 percent of the sampled election-related tweets that went to Pennsylvanians, 34 percent to Michigan voters, and 30 percent to those in Wisconsin. In other swing States, the figure reached 42 percent in Missouri, 41 percent in Florida, 40 percent in North Carolina, 38 percent in Colorado, and 35 percent in Ohio.

(4)

On September 6, 2017, the nation’s largest social media platform disclosed that between June 2015 and May 2017, Russian entities purchased $100,000 in political advertisements, publishing roughly 3,000 ads linked to fake accounts associated with the Internet Research Agency, a pro-Kremlin organization. According to the company, the ads purchased focused “on amplifying divisive social and political messages . . .”.

(5)

In 2002, the Bipartisan Campaign Reform Act became law, establishing disclosure requirements for political advertisements distributed from a television or radio broadcast station or provider of cable or satellite television. In 2003, the Supreme Court upheld regulations on electioneering communications established under the Act, noting that such requirements “provide the electorate with information and insure that the voters are fully informed about the person or group who is speaking.”.

(6)

According to a study from Borrell Associates, in 2016, $1,415,000,000 was spent on online advertising, more than quadruple the amount in 2012.

(7)

The reach of a few large internet platforms—larger than any broadcast, satellite, or cable provider—has greatly facilitated the scope and effectiveness of disinformation campaigns. For instance, the largest platform has over 210,000,000 Americans users—over 160,000,000 of them on a daily basis. By contrast, the largest cable television provider has 22,430,000 subscribers, while the largest satellite television provider has 21,000,000 subscribers. And the most-watched television broadcast in United States history had 118,000,000 viewers.

(8)

The public nature of broadcast television, radio, and satellite ensures a level of publicity for any political advertisement. These communications are accessible to the press, fact-checkers, and political opponents; this creates strong disincentives for a candidate to disseminate materially false, inflammatory, or contradictory messages to the public. Social media platforms, in contrast, can target portions of the electorate with direct, ephemeral advertisements often on the basis of private information the platform has on individuals, enabling political advertisements that are contradictory, racially or socially inflammatory, or materially false.

(9)

According to comScore, 2 companies own 8 of the 10 most popular smartphone applications as of June 2017, including the most popular social media and email services—which deliver information and news to users without requiring proactivity by the user. Those same 2 companies accounted for 99 percent of revenue growth from digital advertising in 2016, including 77 percent of gross spending. 79 percent of online Americans—representing 68 percent of all Americans—use the single largest social network, while 66 percent of these users are most likely to get their news from that site.

(10)

In its 2006 rulemaking, the Federal Election Commission noted that only 18 percent of all Americans cited the internet as their leading source of news about the 2004 Presidential election; by contrast, the Pew Research Center found that 65 percent of Americans identified an internet-based source as their leading source of information for the 2016 election.

(11)

The Federal Election Commission, the independent Federal agency charged with protecting the integrity of the Federal campaign finance process by providing transparency and administering campaign finance laws, has failed to take action to address online political advertisements.

(12)

In testimony before the Senate Select Committee on Intelligence titled, “Disinformation: A Primer in Russian Active Measures and Influence Campaigns”, multiple expert witnesses testified that while the disinformation tactics of foreign adversaries have not necessarily changed, social media services now provide “platform[s] practically purpose-built for active measures[.]”. Similarly, as Gen. Keith B. Alexander (RET.), the former Director of the National Security Agency, testified, during the Cold War “if the Soviet Union sought to manipulate information flow, it would have to do so principally through its own propaganda outlets or through active measures that would generate specific news: planting of leaflets, inciting of violence, creation of other false materials and narratives. But the news itself was hard to manipulate because it would have required actual control of the organs of media, which took long-term efforts to penetrate. Today, however, because the clear majority of the information on social media sites is uncurated and there is a rapid proliferation of information sources and other sites that can reinforce information, there is an increasing likelihood that the information available to average consumers may be inaccurate (whether intentionally or otherwise) and may be more easily manipulable than in prior eras.”.

(13)

Current regulations on political advertisements do not provide sufficient transparency to uphold the public’s right to be fully informed about political advertisements made online.

Sec. 4204 Sense of Congress

It is the sense of Congress that—

(1)

the dramatic increase in digital political advertisements, and the growing centrality of online platforms in the lives of Americans, requires the Congress and the Federal Election Commission to take meaningful action to ensure that laws and regulations provide the accountability and transparency that is fundamental to our democracy;

(2)

free and fair elections require both transparency and accountability which give the public a right to know the true sources of funding for political advertisements in order to make informed political choices and hold elected officials accountable; and

(3)

transparency of funding for political advertisements is essential to enforce other campaign finance laws, including the prohibition on campaign spending by foreign nationals.

Sec. 4205 Expansion of definition of public communication

(a)

In general— Paragraph (22) of section 301 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30101(22)) is amended by striking “or satellite communication” and inserting “satellite, paid internet, or paid digital communication”.

(b)

Treatment of contributions and expenditures— Section 301 of such Act (52 U.S.C. 30101) is amended—

(1)

in paragraph (8)(B)—

(A)

in clause (v), by striking “on broadcasting stations, or in newspapers, magazines, or similar types of general public political advertising” and inserting “in any public communication”;

(B)

in clause (ix), by striking “broadcasting, newspaper, magazine, billboard, direct mail, or similar type of general public communication or political advertising” and inserting “public communication”; and

(C)

in clause (x), by striking “but not including the use of broadcasting, newspapers, magazines, billboards, direct mail, or similar types of general public communication or political advertising” and inserting “but not including use in any public communication”; and

(2)

in paragraph (9)(B)—

(A)

by amending clause (i) to read as follows:

“(i) any news story, commentary, or editorial distributed through the facilities of any broadcasting station or any print, online, or digital newspaper, magazine, blog, publication, or periodical, unless such broadcasting, print, online, or digital facilities are owned or controlled by any political party, political committee, or candidate;”

(B)

in clause (iv), by striking “on broadcasting stations, or in newspapers, magazines, or similar types of general public political advertising” and inserting “in any public communication”.

(c)

Disclosure and disclaimer statements— Subsection (a) of section 318 of such Act (52 U.S.C. 30120) is amended—

(1)

by striking “financing any communication through any broadcasting station, newspaper, magazine, outdoor advertising facility, mailing, or any other type of general public political advertising” and inserting “financing any public communication”; and

(2)

by striking “solicits any contribution through any broadcasting station, newspaper, magazine, outdoor advertising facility, mailing, or any other type of general public political advertising” and inserting “solicits any contribution through any public communication”.

Sec. 4206 Expansion of definition of electioneering communication

(a)

Expansion to online communications—

(1)

Application to qualified Internet and digital communications—

(A)

In general— Subparagraph (A) of section 304(f)(3) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30104(f)(3)(A)) is amended by striking “or satellite communication” each place it appears in clauses (i) and (ii) and inserting “satellite, or qualified internet or digital communication”.

(B)

Qualified Internet or digital communication— Paragraph (3) of section 304(f) of such Act (52 U.S.C. 30104(f)) is amended by adding at the end the following new subparagraph:

“(D) Qualified Internet or digital communication—The term qualified internet or digital communication means any communication which is placed or promoted for a fee on an online platform (as defined in subsection (j)(3)).”

(2)

Nonapplication of relevant electorate to online communications— Section 304(f)(3)(A)(i)(III) of such Act (52 U.S.C. 30104(f)(3)(A)(i)(III)) is amended by inserting “any broadcast, cable, or satellite” before “communication”.

(3)

News exemption— Section 304(f)(3)(B)(i) of such Act (52 U.S.C. 30104(f)(3)(B)(i)) is amended to read as follows:

“(i) a communication appearing in a news story, commentary, or editorial distributed through the facilities of any broadcasting station or any online or digital newspaper, magazine, blog, publication, or periodical, unless such broadcasting, online, or digital facilities are owned or controlled by any political party, political committee, or candidate;”

(b)

Effective date— The amendments made by this section shall apply with respect to communications made on or after January 1, 2020.

Sec. 4207 Application of disclaimer statements to online communications

(a)

Clear and conspicuous manner requirement— Subsection (a) of section 318 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30120(a)) is amended—

(1)

by striking “shall clearly state” each place it appears in paragraphs (1), (2), and (3) and inserting “shall state in a clear and conspicuous manner”; and

(2)

by adding at the end the following flush sentence: “For purposes of this section, a communication does not make a statement in a clear and conspicuous manner if it is difficult to read or hear or if the placement is easily overlooked.”.

(b)

Special rules for qualified Internet or digital communications—

(1)

In general— Section 318 of such Act (52 U.S.C. 30120) is amended by adding at the end the following new subsection:

“(e) Special rules for qualified Internet or digital communications

“(1) Special rules with respect to statements—In the case of any qualified internet or digital communication (as defined in section 304(f)(3)(D)) which is disseminated through a medium in which the provision of all of the information specified in this section is not possible, the communication shall, in a clear and conspicuous manner—

“(A) state the name of the person who paid for the communication; and

“(B) provide a means for the recipient of the communication to obtain the remainder of the information required under this section with minimal effort and without receiving or viewing any additional material other than such required information.

“(2) Safe harbor for determining clear and conspicuous manner—A statement in qualified internet or digital communication (as defined in section 304(f)(3)(D)) shall be considered to be made in a clear and conspicuous manner as provided in subsection (a) if the communication meets the following requirements:

“(A) Text or graphic communications—In the case of a text or graphic communication, the statement—

“(i) appears in letters at least as large as the majority of the text in the communication; and

“(ii) meets the requirements of paragraphs (2) and (3) of subsection (c).

“(B) Audio communications—In the case of an audio communication, the statement is spoken in a clearly audible and intelligible manner at the beginning or end of the communication and lasts at least 3 seconds.

“(C) Video communications—In the case of a video communication which also includes audio, the statement—

“(i) is included at either the beginning or the end of the communication; and

“(ii) is made both in—

“(I) a written format that meets the requirements of subparagraph (A) and appears for at least 4 seconds; and

“(II) an audible format that meets the requirements of subparagraph (B).

“(D) Other communications—In the case of any other type of communication, the statement is at least as clear and conspicuous as the statement specified in subparagraph (A), (B), or (C).”

(2)

Nonapplication of certain exceptions— The exceptions provided in section 110.11(f)(1)(i) and (ii) of title 11, Code of Federal Regulations, or any successor to such rules, shall have no application to qualified internet or digital communications (as defined in section 304(f)(3)(D) of the Federal Election Campaign Act of 1971).

(c)

Modification of additional requirements for certain communications— Section 318(d) of such Act (52 U.S.C. 30120(d)) is amended—

(1)

in paragraph (1)(A)—

(A)

by striking “which is transmitted through radio” and inserting “which is in an audio format”; and

(B)

by striking “By radio” in the heading and inserting “Audio format”;

(2)

in paragraph (1)(B)—

(A)

by striking “which is transmitted through television” and inserting “which is in video format”; and

(B)

by striking “By television” in the heading and inserting “Video format”; and

(3)

in paragraph (2)—

(A)

by striking “transmitted through radio or television” and inserting “made in audio or video format”; and

(B)

by striking “through television” in the second sentence and inserting “in video format”.

Sec. 4208 Political record requirements for online platforms

(a)

In general— Section 304 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30104) is amended by adding at the end the following new subsection:

“(j) Disclosure of certain online advertisements

“(1) In general

“(A) Requirements for online platforms—An online platform shall maintain, and make available for online public inspection in machine readable format, a complete record of any request to purchase on such online platform a qualified political advertisement which is made by a person whose aggregate requests to purchase qualified political advertisements on such online platform during the calendar year exceeds $500.

“(B) Requirements for advertisers—Any person who requests to purchase a qualified political advertisement on an online platform shall provide the online platform with such information as is necessary for the online platform to comply with the requirements of subparagraph (A).

“(2) Contents of record—A record maintained under paragraph (1)(A) shall contain—

“(A) a digital copy of the qualified political advertisement;

“(B) a description of the audience targeted by the advertisement, the number of views generated from the advertisement, and the date and time that the advertisement is first displayed and last displayed; and

“(C) information regarding—

“(i) the average rate charged for the advertisement;

“(ii) the name of the candidate to which the advertisement refers and the office to which the candidate is seeking election, the election to which the advertisement refers, or the national legislative issue to which the advertisement refers (as applicable);

“(iii) in the case of a request made by, or on behalf of, a candidate, the name of the candidate, the authorized committee of the candidate, and the treasurer of such committee; and

“(iv) in the case of any request not described in clause (iii), the name of the person purchasing the advertisement, the name, address, and phone number of a contact person for such person, and a list of the chief executive officers or members of the executive committee or of the board of directors of such person.

“(3) Online platform—For purposes of this subsection, the term online platform means any public-facing website, web application, or digital application (including a social network, ad network, or search engine) which—

“(A) sells qualified political advertisements; and

“(B) has 50,000,000 or more unique monthly United States visitors or users for a majority of months during the preceding 12 months.

“(4) Qualified political advertisement

“(A) In general—For purposes of this subsection, the term qualified political advertisement means any advertisement (including search engine marketing, display advertisements, video advertisements, native advertisements, and sponsorships) that—

“(i) is made by or on behalf of a candidate; or

“(ii) communicates a message relating to any political matter of national importance, including—

“(I) a candidate;

“(II) any election to Federal office; or

“(III) a national legislative issue of public importance.

“(5) Time to maintain file—The information required under this subsection shall be made available as soon as possible and shall be retained by the online platform for a period of not less than 4 years.

“(6) Penalties—For penalties for failure by online platforms, and persons requesting to purchase a qualified political advertisement on online platforms, to comply with the requirements of this subsection, see section 309.”

(b)

Rulemaking— Not later than 90 days after the date of the enactment of this Act, the Federal Election Commission shall establish rules—

(1)

requiring common data formats for the record required to be maintained under section 304(j) of the Federal Election Campaign Act of 1971 (as added by subsection (a)) so that all online platforms submit and maintain data online in a common, machine-readable and publicly accessible format; and

(2)

establishing search interface requirements relating to such record, including searches by candidate name, issue, purchaser, and date.

(c)

Reporting— Not later than 2 years after the date of the enactment of this Act, and biannually thereafter, the Chairman of the Federal Election Commission shall submit a report to Congress on—

(1)

matters relating to compliance with and the enforcement of the requirements of section 304(j) of the Federal Election Campaign Act of 1971, as added by subsection (a);

(2)

recommendations for any modifications to such section to assist in carrying out its purposes; and

(3)

identifying ways to bring transparency and accountability to political advertisements distributed online for free.

Sec. 4209 Preventing contributions, expenditures, independent expenditures, and disbursements for electioneering communications by foreign nationals in the form of online advertising

Section 319 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30121), as amended by section 4101(b), is further amended by adding at the end the following new subsection:

“(d) Responsibilities of broadcast stations, providers of cable and satellite television, and online platforms—Each television or radio broadcast station, provider of cable or satellite television, or online platform (as defined in section 304(j)(3)) shall make reasonable efforts to ensure that communications described in section 318(a) and made available by such station, provider, or platform are not purchased by a foreign national, directly or indirectly.”

D Stand By Every Ad

Sec. 4301 Short title

This Act may be cited as the “Stand By Every Ad Act”.

Sec. 4302 Stand By Every Ad

(a)

Expanded disclaimer requirements for certain communications— Section 318 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30120), as amended by section 4207(b)(1), is further amended—

(1)

by redesignating subsection (e) as subsection (f); and

(2)

by inserting after subsection (d) the following new subsection:

“(e) Expanded disclaimer requirements for communications not authorized by candidates or committees

“(1) In general—Except as provided in paragraph (6), any communication described in paragraph (3) of subsection (a) which is transmitted in an audio or video format (including an internet or digital communication), or which is an internet or digital communication transmitted in a text or graphic format, shall include, in addition to the requirements of paragraph (3) of subsection (a), the following:

“(A) The individual disclosure statement described in paragraph (2)(A) (if the person paying for the communication is an individual) or the organizational disclosure statement described in paragraph (2)(B) (if the person paying for the communication is not an individual).

“(B) If the communication is transmitted in a video format, or is an internet or digital communication which is transmitted in a text or graphic format, and is paid for in whole or in part with a payment which is treated as a campaign-related disbursement under section 324, the Top Five Funders list (if applicable), unless, on the basis of criteria established in regulations issued by the Commission, the communication is of such short duration that including the Top Five Funders list in the communication would constitute a hardship to the person paying for the communication by requiring a disproportionate amount of the content of the communication to consist of the Top Five Funders list.

“(C) If the communication is transmitted in an audio format and is paid for in whole or in part with a payment which is treated as a campaign-related disbursement under section 324, the Top Two Funders list (if applicable), unless, on the basis of criteria established in regulations issued by the Commission, the communication is of such short duration that including the Top Two Funders list in the communication would constitute a hardship to the person paying for the communication by requiring a disproportionate amount of the content of the communication to consist of the Top Two Funders list.

“(2) Disclosure statements described

“(A) Individual disclosure statements—The individual disclosure statement described in this subparagraph is the following: “I am ________, and I approve this message.”, with the blank filled in with the name of the applicable individual.

“(B) Organizational disclosure statements—The organizational disclosure statement described in this subparagraph is the following: “I am ________, the ________ of ________, and ________ approves this message.”, with—

“(i) the first blank to be filled in with the name of the applicable individual;

“(ii) the second blank to be filled in with the title of the applicable individual; and

“(iii) the third and fourth blank each to be filled in with the name of the organization or other person paying for the communication.

“(3) Method of conveyance of statement

“(A) Communications in text or graphic format—In the case of a communication to which this subsection applies which is transmitted in a text or graphic format, the disclosure statements required under paragraph (1) shall appear in letters at least as large as the majority of the text in the communication.

“(B) Communications transmitted in audio format—In the case of a communication to which this subsection applies which is transmitted in an audio format, the disclosure statements required under paragraph (1) shall be made by audio by the applicable individual in a clear and conspicuous manner.

“(C) Communications transmitted in video format—In the case of a communication to which this subsection applies which is transmitted in a video format, the information required under paragraph (1)—

“(i) shall appear in writing at the end of the communication or in a crawl along the bottom of the communication in a clear and conspicuous manner, with a reasonable degree of color contrast between the background and the printed statement, for a period of at least 6 seconds; and

“(ii) shall also be conveyed by an unobscured, full-screen view of the applicable individual or by the applicable individual making the statement in voice-over accompanied by a clearly identifiable photograph or similar image of the individual, except in the case of a Top Five Funders list.

“(4) Applicable individual defined—The term applicable individual means, with respect to a communication to which this subsection applies—

“(A) if the communication is paid for by an individual, the individual involved;

“(B) if the communication is paid for by a corporation, the chief executive officer of the corporation (or, if the corporation does not have a chief executive officer, the highest ranking official of the corporation);

“(C) if the communication is paid for by a labor organization, the highest ranking officer of the labor organization; and

“(D) if the communication is paid for by any other person, the highest ranking official of such person.

“(5) Top Five Funders list and Top Two Funders list defined

“(A) Top Five Funders list—The term Top Five Funders list means, with respect to a communication which is paid for in whole or in part with a campaign-related disbursement (as defined in section 324), a list of the five persons who, during the 12-month period ending on the date of the disbursement, provided the largest payments of any type in an aggregate amount equal to or exceeding $10,000 to the person who is paying for the communication and the amount of the payments each such person provided. If two or more people provided the fifth largest of such payments, the person paying for the communication shall select one of those persons to be included on the Top Five Funders list.

“(B) Top Two Funders list—The term Top Two Funders list means, with respect to a communication which is paid for in whole or in part with a campaign-related disbursement (as defined in section 324), a list of the persons who, during the 12-month period ending on the date of the disbursement, provided the largest and the second largest payments of any type in an aggregate amount equal to or exceeding $10,000 to the person who is paying for the communication and the amount of the payments each such person provided. If two or more persons provided the second largest of such payments, the person paying for the communication shall select one of those persons to be included on the Top Two Funders list.

“(C) Exclusion of certain payments—For purposes of subparagraphs (A) and (B), in determining the amount of payments made by a person to a person paying for a communication, there shall be excluded the following:

“(i) Any amounts provided in the ordinary course of any trade or business conducted by the person paying for the communication or in the form of investments in the person paying for the communication.

“(ii) Any payment which the person prohibited, in writing, from being used for campaign-related disbursements, but only if the person paying for the communication agreed to follow the prohibition and deposited the payment in an account which is segregated from any account used to make campaign-related disbursements.

“(6) Exception for communications paid for by political parties and certain political committees—This subsection does not apply to any communication to which subsection (d)(2) applies.”

(b)

Application of expanded requirements to public communications consisting of campaign-Related disbursements— Section 318(a) of such Act (52 U.S.C. 30120(a)) is amended by striking “for the purpose of financing communications expressly advocating the election or defeat of a clearly identified candidate” and inserting “for a campaign-related disbursement, as defined in section 324, consisting of a public communication”.

(c)

Exception for communications paid for by political parties and certain political committees— Section 318(d)(2) of such Act (52 U.S.C. 30120(d)(2)) is amended—

(1)

in the heading, by striking “Others” and inserting “certain political committees”;

(2)

by striking “Any communication” and inserting “(A) Any communication”;

(3)

by inserting “which (except to the extent provided in subparagraph (B)) is paid for by a political committee (including a political committee of a political party) and” after “subsection (a)”;

(4)

by striking “or other person” each place it appears; and

(5)

by adding at the end the following new subparagraph:

“(B)

“(i) This paragraph does not apply to a communication paid for in whole or in part during a calendar year with a campaign-related disbursement, but only if the covered organization making the campaign-related disbursement made campaign-related disbursements (as defined in section 324) aggregating more than $10,000 during such calendar year.

“(ii) For purposes of clause (i), in determining the amount of campaign-related disbursements made by a covered organization during a year, there shall be excluded the following:

“(I) Any amounts received by the covered organization in the ordinary course of any trade or business conducted by the covered organization or in the form of investments in the covered organization.

“(II) Any amounts received by the covered organization from a person who prohibited, in writing, the organization from using such amounts for campaign-related disbursements, but only if the covered organization agreed to follow the prohibition and deposited the amounts in an account which is segregated from any account used to make campaign-related disbursements.”

Sec. 4303 Disclaimer requirements for communications made through prerecorded telephone calls

(a)

Application of requirements—

(1)

In general— Section 318(a) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30120(a)), as amended by section 4205(c), is amended by inserting after “public communication” each place it appears the following: “(including a telephone call consisting in substantial part of a prerecorded audio message)”.

(2)

Application to communications subject to expanded disclaimer requirements— Section 318(e)(1) of such Act (52 U.S.C. 30120(e)(1)), as added by section 4302(a), is amended in the matter preceding subparagraph (A) by striking “which is transmitted in an audio or video format” and inserting “which is transmitted in an audio or video format or which consists of a telephone call consisting in substantial part of a prerecorded audio message”.

(b)

Treatment as communication transmitted in audio format—

(1)

Communications by candidates or authorized persons— Section 318(d) of such Act (52 U.S.C. 30120(d)) is amended by adding at the end the following new paragraph:

“(3) Prerecorded telephone calls—Any communication described in paragraph (1), (2), or (3) of subsection (a) (other than a communication which is subject to subsection (e)) which is a telephone call consisting in substantial part of a prerecorded audio message shall include, in addition to the requirements of such paragraph, the audio statement required under subparagraph (A) of paragraph (1) or the audio statement required under paragraph (2) (whichever is applicable), except that the statement shall be made at the beginning of the telephone call.”

(2)

Communications subject to expanded disclaimer requirements— Section 318(e)(3) of such Act (52 U.S.C. 30120(e)(3)), as added by section 4302(a), is amended by adding at the end the following new subparagraph:

“(C) Prerecorded telephone calls—In the case of a communication to which this subsection applies which is a telephone call consisting in substantial part of a prerecorded audio message, the communication shall be considered to be transmitted in an audio format.”

Sec. 4304 No expansion of persons subject to disclaimer requirements on internet communications

Nothing in this subtitle or the amendments made by this subtitle may be construed to require any person who is not required under section 318 of the Federal Election Campaign Act of 1971 (as provided under section 110.11 of title 11 of the Code of Federal Regulations) to include a disclaimer on communications made by the person through the internet to include any disclaimer on any such communications.

Sec. 4305 Effective date

The amendments made by this subtitle shall apply with respect to communications made on or after January 1, 2020, and shall take effect without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments.

E Secret Money Transparency

Sec. 4401 Repeal of restriction of use of funds by Internal Revenue Service to bring transparency to political activity of certain nonprofit organizations

Section 124 of the Financial Services and General Government Appropriations Act, 2019 (division D of Public Law 116–6) is hereby repealed.

F Shareholder Right-To-Know

Sec. 4501 Repeal of restriction on use of funds by Securities and Exchange Commission to ensure shareholders of corporations have knowledge of corporation political activity

Section 629 of the Financial Services and General Government Appropriations Act, 2019 (division D of Public Law 116–6) is hereby repealed.

G Disclosure of Political Spending by Government Contractors

Sec. 4601 Repeal of restriction on use of funds to require disclosure of political spending by government contractors

Section 735 of the Financial Services and General Government Appropriations Act, 2019 (division D of Public Law 116–6) is hereby repealed.

H Limitation and Disclosure Requirements for Presidential Inaugural Committees

Sec. 4701 Short title

This subtitle may be cited as the “Presidential Inaugural Committee Oversight Act”.

Sec. 4702 Limitations and disclosure of certain donations to, and disbursements by, inaugural committees

(a)

Requirements for Inaugural Committees— Title III of the Federal Election Campaign Act of 1971 (52 U.S.C. 30101 et seq.) is amended by adding at the end the following new section:

“325. Inaugural committees

“(a) Prohibited donations

“(1) In general—It shall be unlawful—

“(A) for an Inaugural Committee—

“(i) to solicit, accept, or receive a donation from a person that is not an individual; or

“(ii) to solicit, accept, or receive a donation from a foreign national;

“(B) for a person—

“(i) to make a donation to an Inaugural Committee in the name of another person, or to knowingly authorize his or her name to be used to effect such a donation;

“(ii) to knowingly accept a donation to an Inaugural Committee made by a person in the name of another person; or

“(iii) to convert a donation to an Inaugural Committee to personal use as described in paragraph (2); and

“(C) for a foreign national to, directly or indirectly, make a donation, or make an express or implied promise to make a donation, to an Inaugural Committee.

“(2) Conversion of donation to personal use—For purposes of paragraph (1)(B)(iii), a donation shall be considered to be converted to personal use if any part of the donated amount is used to fulfill a commitment, obligation, or expense of a person that would exist irrespective of the responsibilities of the Inaugural Committee under chapter 5 of title 36, United States Code.

“(3) No effect on disbursement of unused funds to nonprofit organizations—Nothing in this subsection may be construed to prohibit an Inaugural Committee from disbursing unused funds to an organization which is described in section 501(c)(3) of the Internal Revenue Code of 1986 and is exempt from taxation under section 501(a) of such Code.

“(b) Limitation on donations

“(1) In general—It shall be unlawful for an individual to make donations to an Inaugural Committee which, in the aggregate, exceed $50,000.

“(2) Indexing—At the beginning of each Presidential election year (beginning with 2024), the amount described in paragraph (1) shall be increased by the cumulative percent difference determined in section 315(c)(1)(A) since the previous Presidential election year. If any amount after such increase is not a multiple of $1,000, such amount shall be rounded to the nearest multiple of $1,000.

“(c) Disclosure of certain donations and disbursements

“(1) Donations over $1,000

“(A) In general—An Inaugural Committee shall file with the Commission a report disclosing any donation by an individual to the committee in an amount of $1,000 or more not later than 24 hours after the receipt of such donation.

“(B) Contents of report—A report filed under subparagraph (A) shall contain—

“(i) the amount of the donation;

“(ii) the date the donation is received; and

“(iii) the name and address of the individual making the donation.

“(2) Final report—Not later than the date that is 90 days after the date of the Presidential inaugural ceremony, the Inaugural Committee shall file with the Commission a report containing the following information:

“(A) For each donation of money or anything of value made to the committee in an aggregate amount equal to or greater than $200—

“(i) the amount of the donation;

“(ii) the date the donation is received; and

“(iii) the name and address of the individual making the donation.

“(B) The total amount of all disbursements, and all disbursements in the following categories:

“(i) Disbursements made to meet committee operating expenses.

“(ii) Repayment of all loans.

“(iii) Donation refunds and other offsets to donations.

“(iv) Any other disbursements.

“(C) The name and address of each person—

“(i) to whom a disbursement in an aggregate amount or value in excess of $200 is made by the committee to meet a committee operating expense, together with date, amount, and purpose of such operating expense;

“(ii) who receives a loan repayment from the committee, together with the date and amount of such loan repayment;

“(iii) who receives a donation refund or other offset to donations from the committee, together with the date and amount of such disbursement; and

“(iv) to whom any other disbursement in an aggregate amount or value in excess of $200 is made by the committee, together with the date and amount of such disbursement.

“(d) Definitions—For purposes of this section:

“(1)

“(A) The term donation includes—

“(i) any gift, subscription, loan, advance, or deposit of money or anything of value made by any person to the committee; or

“(ii) the payment by any person of compensation for the personal services of another person which are rendered to the committee without charge for any purpose.

“(B) The term donation does not include the value of services provided without compensation by any individual who volunteers on behalf of the committee.

“(2) The term foreign national has the meaning given that term by section 319(b).

“(3) The term Inaugural Committee has the meaning given that term by section 501 of title 36, United States Code.”

(b)

Confirming amendment related to reporting requirements— Section 304 of the Federal Election Campaign Act (52 U.S.C. 30104) is amended—

(1)

by striking subsection (h); and

(2)

by redesignating subsection (i) as subsection (h).

(c)

Conforming amendment related to status of committee— Section 510 of title 36, United States Code, is amended to read as follows:

“510. Disclosure of and prohibition on certain donations

“A committee shall not be considered to be the Inaugural Committee for purposes of this chapter unless the committee agrees to, and meets, the requirements of section 325 of the Federal Election Campaign Act of 1971.”

(d)

Effective date— The amendments made by this Act shall apply with respect to Inaugural Committees established under chapter 5 of title 36, United States Code, for inaugurations held in 2021 and any succeeding year.

I Severability

Sec. 4801 Severability

If any provision of this title or amendment made by this title, or the application of a provision or amendment to any person or circumstance, is held to be unconstitutional, the remainder of this title and amendments made by this title, and the application of the provisions and amendment to any person or circumstance, shall not be affected by the holding.

V Campaign Finance Oversight

A Restoring Integrity to America’s Elections

Sec. 5001 Short title

This subtitle may be cited as the “Restoring Integrity to America’s Elections Act”.

Sec. 5002 Membership of Federal Election Commission

(a)

Reduction in Number of Members; Removal of Secretary of Senate and Clerk of House as Ex Officio Members—

(1)

In general; quorum— Section 306(a)(1) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30106(a)(1)) is amended by striking the second and third sentences and inserting the following: “The Commission is composed of 5 members appointed by the President by and with the advice and consent of the Senate, of whom no more than 2 may be affiliated with the same political party. A majority of the number of members of the Commission who are serving at the time shall constitute a quorum, except that 3 members shall constitute a quorum if there are 4 members serving at the time.”.

(2)

Conforming amendments relating to reduction in number of members—

(A)

The second sentence of section 306(c) of such Act (52 U.S.C. 30106(c)) is amended by striking “affirmative vote of 4 members of the Commission” and inserting “affirmative vote of a majority of the members of the Commission who are serving at the time”.

(B)

Such Act is further amended by striking “affirmative vote of 4 of its members” and inserting “affirmative vote of a majority of the members of the Commission who are serving at the time” each place it appears in the following sections:

(i)

Section 309(a)(2) (52 U.S.C. 30109(a)(2)).

(ii)

Section 309(a)(4)(A)(i) (52 U.S.C. 30109(a)(4)(A)(i)).

(iii)

Section 309(a)(5)(C) (52 U.S.C. 30109(a)(5)(C)).

(iv)

Section 309(a)(6)(A) (52 U.S.C. 30109(a)(6)(A)).

(v)

Section 311(b) (52 U.S.C. 30111(b)).

(3)

Conforming amendment relating to removal of ex officio members— Section 306(a) of such Act (52 U.S.C. 30106(a)) is amended by striking “(other than the Secretary of the Senate and the Clerk of the House of Representatives)” each place it appears in paragraphs (4) and (5).

(b)

“(2) Terms of service

“(A) In general—Each member of the Commission shall serve for a single term of 6 years.

“(B) Special rule for initial appointments—Of the members first appointed to serve terms that begin in January 2022, the President shall designate 2 to serve for a 3-year term.

“(C) No reappointment permitted—An individual who served a term as a member of the Commission may not serve for an additional term, except that—

“(i) an individual who served a 3-year term under subparagraph (B) may also be appointed to serve a 6-year term under subparagraph (A); and

“(ii) for purposes of this subparagraph, an individual who is appointed to fill a vacancy under subparagraph (D) shall not be considered to have served a term if the portion of the unexpired term the individual fills is less than 50 percent of the period of the term.

“(D) Vacancies—Any vacancy occurring in the membership of the Commission shall be filled in the same manner as in the case of the original appointment. Except as provided in subparagraph (C), an individual appointed to fill a vacancy occurring other than by the expiration of a term of office shall be appointed only for the unexpired term of the member he or she succeeds.

“(E) Limitation on service after expiration of term—A member of the Commission may continue to serve on the Commission after the expiration of the member’s term for an additional period, but only until the earlier of—

“(i) the date on which the member’s successor has taken office as a member of the Commission; or

“(ii) the expiration of the 1-year period that begins on the last day of the member’s term.”

(c)

Qualifications— Section 306(a)(3) of such Act (52 U.S.C. 30106(a)(3)) is amended to read as follows:

“(3) Qualifications

“(A) In general—The President may select an individual for service as a member of the Commission if the individual has experience in election law and has a demonstrated record of integrity, impartiality, and good judgment.

“(B) Assistance of Blue Ribbon Advisory Panel

“(i) In general—Prior to the regularly scheduled expiration of the term of a member of the Commission and upon the occurrence of a vacancy in the membership of the Commission prior to the expiration of a term, the President shall convene a Blue Ribbon Advisory Panel, consisting of an odd number of individuals selected by the President from retired Federal judges, former law enforcement officials, or individuals with experience in election law, except that the President may not select any individual to serve on the panel who holds any public office at the time of selection.

“(ii) Recommendations—With respect to each member of the Commission whose term is expiring or each vacancy in the membership of the Commission (as the case may be), the Blue Ribbon Advisory Panel shall recommend to the President at least one but not more than 3 individuals for nomination for appointment as a member of the Commission.

“(iii) Publication—At the time the President submits to the Senate the nominations for individuals to be appointed as members of the Commission, the President shall publish the Blue Ribbon Advisory Panel’s recommendations for such nominations.

“(iv) Exemption from Federal Advisory Committee Act—The Federal Advisory Committee Act (5 U.S.C. App.) does not apply to a Blue Ribbon Advisory Panel convened under this subparagraph.

“(C) Prohibiting engagement with other business or employment during service—A member of the Commission shall not engage in any other business, vocation, or employment. Any individual who is engaging in any other business, vocation, or employment at the time of his or her appointment to the Commission shall terminate or liquidate such activity no later than 90 days after such appointment.”

Sec. 5003 Assignment of powers to Chair of Federal Election Commission

(a)

Appointment of Chair by President—

(1)

In general— Section 306(a)(5) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30106(a)(5)) is amended to read as follows:

“(5) Chair

“(A) Initial appointment—Of the members first appointed to serve terms that begin in January 2022, one such member (as designated by the President at the time the President submits nominations to the Senate) shall serve as Chair of the Commission.

“(B) Subsequent appointments—Any individual who is appointed to succeed the member who serves as Chair of the Commission for the term beginning in January 2022 (as well as any individual who is appointed to fill a vacancy if such member does not serve a full term as Chair) shall serve as Chair of the Commission.

“(C) Vice Chair—The Commission shall select, by majority vote of its members, one of its members to serve as Vice Chair, who shall act as Chair in the absence or disability of the Chair or in the event of a vacancy in the position of Chair.”

(2)

Conforming amendment— Section 309(a)(2) of such Act (52 U.S.C. 30109(a)(2)) is amended by striking “through its chairman or vice chairman” and inserting “through the Chair”.

(b)

Powers—

(1)

Assignment of certain powers to Chair— Section 307(a) of such Act (52 U.S.C. 30107(a)) is amended to read as follows:

“(a) Distribution of Powers Between Chair and Commission

“(1) Powers assigned to Chair

“(A) Administrative powers—The Chair of the Commission shall be the chief administrative officer of the Commission and shall have the authority to administer the Commission and its staff, and (in consultation with the other members of the Commission) shall have the power—

“(i) to appoint and remove the staff director of the Commission;

“(ii) to request the assistance (including personnel and facilities) of other agencies and departments of the United States, whose heads may make such assistance available to the Commission with or without reimbursement; and

“(iii) to prepare and establish the budget of the Commission and to make budget requests to the President, the Director of the Office of Management and Budget, and Congress.

“(B) Other powers—The Chair of the Commission shall have the power—

“(i) to appoint and remove the general counsel of the Commission with the concurrence of at least 2 other members of the Commission;

“(ii) to require by special or general orders, any person to submit, under oath, such written reports and answers to questions as the Chair may prescribe;

“(iii) to administer oaths or affirmations;

“(iv) to require by subpoena, signed by the Chair, the attendance and testimony of witnesses and the production of all documentary evidence relating to the execution of its duties;

“(v) in any proceeding or investigation, to order testimony to be taken by deposition before any person who is designated by the Chair, and shall have the power to administer oaths and, in such instances, to compel testimony and the production of evidence in the same manner as authorized under clause (iv); and

“(vi) to pay witnesses the same fees and mileage as are paid in like circumstances in the courts of the United States.

“(2) Powers assigned to Commission—The Commission shall have the power—

“(A) to initiate (through civil actions for injunctive, declaratory, or other appropriate relief), defend (in the case of any civil action brought under section 309(a)(8) of this Act) or appeal any civil action in the name of the Commission to enforce the provisions of this Act and chapter 95 and chapter 96 of the Internal Revenue Code of 1986, through its general counsel;

“(B) to render advisory opinions under section 308 of this Act;

“(C) to develop such prescribed forms and to make, amend, and repeal such rules, pursuant to the provisions of chapter 5 of title 5, United States Code, as are necessary to carry out the provisions of this Act and chapter 95 and chapter 96 of the Internal Revenue Code of 1986;

“(D) to conduct investigations and hearings expeditiously, to encourage voluntary compliance, and to report apparent violations to the appropriate law enforcement authorities; and

“(E) to transmit to the President and Congress not later than June 1 of each year a report which states in detail the activities of the Commission in carrying out its duties under this Act, and which includes any recommendations for any legislative or other action the Commission considers appropriate.

“(3) Permitting Commission to exercise other powers of Chair—With respect to any investigation, action, or proceeding, the Commission, by an affirmative vote of a majority of the members who are serving at the time, may exercise any of the powers of the Chair described in paragraph (1)(B).”

(2)

Conforming amendments relating to personnel authority— Section 306(f) of such Act (52 U.S.C. 30106(f)) is amended—

(A)

by amending the first sentence of paragraph (1) to read as follows: “The Commission shall have a staff director who shall be appointed by the Chair of the Commission in consultation with the other members and a general counsel who shall be appointed by the Chair with the concurrence of at least two other members.”;

(B)

in paragraph (2), by striking “With the approval of the Commission” and inserting “With the approval of the Chair of the Commission”; and

(C)

by striking paragraph (3).

(3)

Conforming amendment relating to budget submission— Section 307(d)(1) of such Act (52 U.S.C. 30107(d)(1)) is amended by striking “the Commission submits any budget” and inserting “the Chair (or, pursuant to subsection (a)(3), the Commission) submits any budget”.

(4)

Other conforming amendments— Section 306(c) of such Act (52 U.S.C. 30106(c)) is amended by striking “All decisions” and inserting “Subject to section 307(a), all decisions”.

(5)

Technical amendment— The heading of section 307 of such Act (52 U.S.C. 30107) is amended by striking “the commission” and inserting “the chair and the commission”.

Sec. 5004 Revision to enforcement process

(a)

Standard for initiating investigations and determining whether violations have occurred—

(1)

Revision of standards— Section 309(a) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30109(a)) is amended by striking paragraphs (2) and (3) and inserting the following:

“(2)

“(A) The general counsel, upon receiving a complaint filed with the Commission under paragraph (1) or upon the basis of information ascertained by the Commission in the normal course of carrying out its supervisory responsibilities, shall make a determination as to whether or not there is reason to believe that a person has committed, or is about to commit, a violation of this Act or chapter 95 or chapter 96 of the Internal Revenue Code of 1986, and as to whether or not the Commission should either initiate an investigation of the matter or that the complaint should be dismissed. The general counsel shall promptly provide notification to the Commission of such determination and the reasons therefore, together with any written response submitted under paragraph (1) by the person alleged to have committed the violation. Upon the expiration of the 30-day period which begins on the date the general counsel provides such notification, the general counsel’s determination shall take effect, unless during such 30-day period the Commission, by vote of a majority of the members of the Commission who are serving at the time, overrules the general counsel’s determination. If the determination by the general counsel that the Commission should investigate the matter takes effect, or if the determination by the general counsel that the complaint should be dismissed is overruled as provided under the previous sentence, the general counsel shall initiate an investigation of the matter on behalf of the Commission.

“(B) If the Commission initiates an investigation pursuant to subparagraph (A), the Commission, through the Chair, shall notify the subject of the investigation of the alleged violation. Such notification shall set forth the factual basis for such alleged violation. The Commission shall make an investigation of such alleged violation, which may include a field investigation or audit, in accordance with the provisions of this section. The general counsel shall provide notification to the Commission of any intent to issue a subpoena or conduct any other form of discovery pursuant to the investigation. Upon the expiration of the 15-day period which begins on the date the general counsel provides such notification, the general counsel may issue the subpoena or conduct the discovery, unless during such 15-day period the Commission, by vote of a majority of the members of the Commission who are serving at the time, prohibits the general counsel from issuing the subpoena or conducting the discovery.

“(3)

“(A) Upon completion of an investigation under paragraph (2), the general counsel shall promptly submit to the Commission the general counsel’s recommendation that the Commission find either that there is probable cause or that there is not probable cause to believe that a person has committed, or is about to commit, a violation of this Act or chapter 95 or chapter 96 of the Internal Revenue Code of 1986, and shall include with the recommendation a brief stating the position of the general counsel on the legal and factual issues of the case.

“(B) At the time the general counsel submits to the Commission the recommendation under subparagraph (A), the general counsel shall simultaneously notify the respondent of such recommendation and the reasons therefore, shall provide the respondent with an opportunity to submit a brief within 30 days stating the position of the respondent on the legal and factual issues of the case and replying to the brief of the general counsel. The general counsel and shall promptly submit such brief to the Commission upon receipt.

“(C) Not later than 30 days after the general counsel submits the recommendation to the Commission under subparagraph (A) (or, if the respondent submits a brief under subparagraph (B), not later than 30 days after the general counsel submits the respondent’s brief to the Commission under such subparagraph), the Commission shall approve or disapprove the recommendation by vote of a majority of the members of the Commission who are serving at the time.”

(2)

Conforming amendment relating to Initial response to filing of complaint— Section 309(a)(1) of such Act (52 U.S.C. 30109(a)(1)) is amended—

(A)

in the third sentence, by striking “the Commission” and inserting “the general counsel”; and

(B)

by amending the fourth sentence to read as follows: “Not later than 15 days after receiving notice from the general counsel under the previous sentence, the person may provide the general counsel with a written response that no action should be taken against such person on the basis of the complaint.”.

(b)

Revision of standard for review of dismissal of complaints—

(1)

In general— Section 309(a)(8) of such Act (52 U.S.C. 30109(a)(8)) is amended to read as follows:

“(8)

“(A)

“(i) Any party aggrieved by an order of the Commission dismissing a complaint filed by such party after finding either no reason to believe a violation has occurred or no probable cause a violation has occurred may file a petition with the United States District Court for the District of Columbia. Any petition under this subparagraph shall be filed within 60 days after the date on which the party received notice of the dismissal of the complaint.

“(ii) In any proceeding under this subparagraph, the court shall determine by de novo review whether the agency’s dismissal of the complaint is contrary to law. In any matter in which the penalty for the alleged violation is greater than $50,000, the court should disregard any claim or defense by the Commission of prosecutorial discretion as a basis for dismissing the complaint.

“(B)

“(i) Any party who has filed a complaint with the Commission and who is aggrieved by a failure of the Commission, within one year after the filing of the complaint, to either dismiss the complaint or to find reason to believe a violation has occurred or is about to occur, may file a petition with the United States District Court for the District of Columbia.

“(ii) In any proceeding under this subparagraph, the court shall treat the failure to act on the complaint as a dismissal of the complaint, and shall determine by de novo review whether the agency’s failure to act on the complaint is contrary to law.

“(C) In any proceeding under this paragraph the court may declare that the dismissal of the complaint or the failure to act is contrary to law, and may direct the Commission to conform with such declaration within 30 days, failing which the complainant may bring, in the name of such complainant, a civil action to remedy the violation involved in the original complaint.”

(2)

Effective date— The amendments made by paragraph (1) shall apply—

(A)

in the case of complaints which are dismissed by the Federal Election Commission, with respect to complaints which are dismissed on or after the date of the enactment of this Act; and

(B)

in the case of complaints upon which the Federal Election Commission failed to act, with respect to complaints which were filed on or after the date of the enactment of this Act.

Sec. 5005 Permitting appearance at hearings on requests for advisory opinions by persons opposing the requests

(a)

In general— Section 308 of such Act (52 U.S.C. 30108) is amended by adding at the end the following new subsection:

“(e) To the extent that the Commission provides an opportunity for a person requesting an advisory opinion under this section (or counsel for such person) to appear before the Commission to present testimony in support of the request, and the person (or counsel) accepts such opportunity, the Commission shall provide a reasonable opportunity for an interested party who submitted written comments under subsection (d) in response to the request (or counsel for such interested party) to appear before the Commission to present testimony in response to the request.”

(b)

Effective date— The amendment made by subsection (a) shall apply with respect to requests for advisory opinions under section 308 of the Federal Election Campaign Act of 1971 which are made on or after the date of the enactment of this Act.

Sec. 5006 Permanent extension of administrative penalty authority

(a)

Extension of authority— Section 309(a)(4)(C)(v) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30109(a)(4)(C)(v)) is amended by striking “, and that end on or before December 31, 2018”.

(b)

Effective date— The amendment made by subsection (a) shall take effect on December 31, 2018.

Sec. 5007 Effective date; transition

(a)

In General— Except as otherwise provided, the amendments made by this subtitle shall apply beginning January 1, 2022.

(b)

Transition—

(1)

Termination of service of current members— Notwithstanding any provision of the Federal Election Campaign Act of 1971, the term of any individual serving as a member of the Federal Election Commission as of December 31, 2021, shall expire on that date.

(2)

No effect on existing cases or proceedings— Nothing in this subtitle or in any amendment made by this subtitle shall affect any of the powers exercised by the Federal Election Commission prior to December 31, 2021, including any investigation initiated by the Commission prior to such date or any proceeding (including any enforcement action) pending as of such date.

B Stopping Super PAC–Candidate Coordination

Sec. 5101 Short title

This subtitle may be cited as the “Stop Super PAC–Candidate Coordination Act”.

Sec. 5102 Clarification of treatment of coordinated expenditures as contributions to candidates

(a)

Treatment as contribution to candidate— Section 301(8)(A) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30101(8)(A)) is amended—

(1)

by striking “or” at the end of clause (i);

(2)

by striking the period at the end of clause (ii) and inserting “; or”; and

(3)

by adding at the end the following new clause:

“(iii) any payment made by any person (other than a candidate, an authorized committee of a candidate, or a political committee of a political party) for a coordinated expenditure (as such term is defined in section 326) which is not otherwise treated as a contribution under clause (i) or clause (ii).”

(b)

Definitions— Title III of such Act (52 U.S.C. 30101 et seq.), as amended by section 4702(a), is amended by adding at the end the following new section:

“326. Payments for coordinated expenditures

“(a) Coordinated expenditures

“(1) In general—For purposes of section 301(8)(A)(iii), the term coordinated expenditure means—

“(A) any expenditure, or any payment for a covered communication described in subsection (d), which is made in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate, an authorized committee of a candidate, a political committee of a political party, or agents of the candidate or committee, as defined in subsection (b); or

“(B) any payment for any communication which republishes, disseminates, or distributes, in whole or in part, any video or broadcast or any written, graphic, or other form of campaign material prepared by the candidate or committee or by agents of the candidate or committee (including any excerpt or use of any video from any such broadcast or written, graphic, or other form of campaign material).

“(2) Exception for payments for certain communications—A payment for a communication (including a covered communication described in subsection (d)) shall not be treated as a coordinated expenditure under this subsection if—

“(A) the communication appears in a news story, commentary, or editorial distributed through the facilities of any broadcasting station, newspaper, magazine, or other periodical publication, unless such facilities are owned or controlled by any political party, political committee, or candidate; or

“(B) the communication constitutes a candidate debate or forum conducted pursuant to regulations adopted by the Commission pursuant to section 304(f)(3)(B)(iii), or which solely promotes such a debate or forum and is made by or on behalf of the person sponsoring the debate or forum.

“(b) Coordination described

“(1) In general—For purposes of this section, a payment is made “in cooperation, consultation, or concert with, or at the request or suggestion of,” a candidate, an authorized committee of a candidate, a political committee of a political party, or agents of the candidate or committee, if the payment, or any communication for which the payment is made, is not made entirely independently of the candidate, committee, or agents. For purposes of the previous sentence, a payment or communication not made entirely independently of the candidate or committee includes any payment or communication made pursuant to any general or particular understanding with, or pursuant to any communication with, the candidate, committee, or agents about the payment or communication.

“(2) No finding of coordination based solely on sharing of information regarding legislative or policy position—For purposes of this section, a payment shall not be considered to be made by a person in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate or committee, solely on the grounds that the person or the person’s agent engaged in discussions with the candidate or committee, or with any agent of the candidate or committee, regarding that person's position on a legislative or policy matter (including urging the candidate or committee to adopt that person's position), so long as there is no communication between the person and the candidate or committee, or any agent of the candidate or committee, regarding the candidate’s or committee’s campaign advertising, message, strategy, policy, polling, allocation of resources, fundraising, or other campaign activities.

“(3) No effect on party coordination standard—Nothing in this section shall be construed to affect the determination of coordination between a candidate and a political committee of a political party for purposes of section 315(d).

“(4) No safe harbor for use of firewall—A person shall be determined to have made a payment in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate or committee, in accordance with this section without regard to whether or not the person established and used a firewall or similar procedures to restrict the sharing of information between individuals who are employed by or who are serving as agents for the person making the payment.

“(c) Payments by coordinated spenders for covered communications

“(1) Payments made in cooperation, consultation, or concert with candidates—For purposes of subsection (a)(1)(A), if the person who makes a payment for a covered communication, as defined in subsection (d), is a coordinated spender under paragraph (2) with respect to the candidate as described in subsection (d)(1), the payment for the covered communication is made in cooperation, consultation, or concert with the candidate.

“(2) Coordinated spender defined—For purposes of this subsection, the term coordinated spender means, with respect to a candidate or an authorized committee of a candidate, a person (other than a political committee of a political party) for which any of the following applies:

“(A) During the 4-year period ending on the date on which the person makes the payment, the person was directly or indirectly formed or established by or at the request or suggestion of, or with the encouragement of, the candidate (including an individual who later becomes a candidate) or committee or agents of the candidate or committee, including with the approval of the candidate or committee or agents of the candidate or committee.

“(B) The candidate or committee or any agent of the candidate or committee solicits funds, appears at a fundraising event, or engages in other fundraising activity on the person’s behalf during the election cycle involved, including by providing the person with names of potential donors or other lists to be used by the person in engaging in fundraising activity, regardless of whether the person pays fair market value for the names or lists provided. For purposes of this subparagraph, the term election cycle means, with respect to an election for Federal office, the period beginning on the day after the date of the most recent general election for that office (or, if the general election resulted in a runoff election, the date of the runoff election) and ending on the date of the next general election for that office (or, if the general election resulted in a runoff election, the date of the runoff election).

“(C) The person is established, directed, or managed by the candidate or committee or by any person who, during the 4-year period ending on the date on which the person makes the payment, has been employed or retained as a political, campaign media, or fundraising adviser or consultant for the candidate or committee or for any other entity directly or indirectly controlled by the candidate or committee, or has held a formal position with the candidate or committee (including a position as an employee of the office of the candidate at any time the candidate held any Federal, State, or local public office during the 4-year period).

“(D) The person has retained the professional services of any person who, during the 2-year period ending on the date on which the person makes the payment, has provided or is providing professional services relating to the campaign to the candidate or committee, without regard to whether the person providing the professional services used a firewall. For purposes of this subparagraph, the term professional services includes any services in support of the candidate’s or committee’s campaign activities, including advertising, message, strategy, policy, polling, allocation of resources, fundraising, and campaign operations, but does not include accounting or legal services.

“(E) The person is established, directed, or managed by a member of the immediate family of the candidate, or the person or any officer or agent of the person has had more than incidental discussions about the candidate’s campaign with a member of the immediate family of the candidate. For purposes of this subparagraph, the term immediate family has the meaning given such term in section 9004(e) of the Internal Revenue Code of 1986.

“(d) Covered communication defined

“(1) In general—For purposes of this section, the term covered communication means, with respect to a candidate or an authorized committee of a candidate, a public communication (as defined in section 301(22)) which—

“(A) expressly advocates the election of the candidate or the defeat of an opponent of the candidate (or contains the functional equivalent of express advocacy);

“(B) promotes or supports the candidate, or attacks or opposes an opponent of the candidate (regardless of whether the communication expressly advocates the election or defeat of a candidate or contains the functional equivalent of express advocacy); or

“(C) refers to the candidate or an opponent of the candidate but is not described in subparagraph (A) or subparagraph (B), but only if the communication is disseminated during the applicable election period.

“(2) Applicable election period—In paragraph (1)(C), the “applicable election period” with respect to a communication means—

“(A) in the case of a communication which refers to a candidate in a general, special, or runoff election, the 120-day period which ends on the date of the election; or

“(B) in the case of a communication which refers to a candidate in a primary or preference election, or convention or caucus of a political party that has authority to nominate a candidate, the 60-day period which ends on the date of the election or convention or caucus.

“(3) Special rules for communications involving congressional candidates—For purposes of this subsection, a public communication shall not be considered to be a covered communication with respect to a candidate for election for an office other than the office of President or Vice President unless it is publicly disseminated or distributed in the jurisdiction of the office the candidate is seeking.

“(e) Penalty

“(1) Determination of amount—Any person who knowingly and willfully commits a violation of this Act by making a contribution which consists of a payment for a coordinated expenditure shall be fined an amount equal to the greater of—

“(A) in the case of a person who makes a contribution which consists of a payment for a coordinated expenditure in an amount exceeding the applicable contribution limit under this Act, 300 percent of the amount by which the amount of the payment made by the person exceeds such applicable contribution limit; or

“(B) in the case of a person who is prohibited under this Act from making a contribution in any amount, 300 percent of the amount of the payment made by the person for the coordinated expenditure.

“(2) Joint and several liability—Any director, manager, or officer of a person who is subject to a penalty under paragraph (1) shall be jointly and severally liable for any amount of such penalty that is not paid by the person prior to the expiration of the 1-year period which begins on the date the Commission imposes the penalty or the 1-year period which begins on the date of the final judgment following any judicial review of the Commission’s action, whichever is later.”

(c)

Effective date—

(1)

Repeal of existing regulations on coordination— Effective upon the expiration of the 90-day period which begins on the date of the enactment of this Act—

(A)

the regulations on coordinated communications adopted by the Federal Election Commission which are in effect on the date of the enactment of this Act (as set forth in 11 CFR Part 109, Subpart C, under the heading “Coordination”) are repealed; and

(B)

the Federal Election Commission shall promulgate new regulations on coordinated communications which reflect the amendments made by this Act.

(2)

Effective date— The amendments made by this section shall apply with respect to payments made on or after the expiration of the 120-day period which begins on the date of the enactment of this Act, without regard to whether or not the Federal Election Commission has promulgated regulations in accordance with paragraph (1)(B) as of the expiration of such period.

Sec. 5103 Clarification of ban on fundraising for super PACs by Federal candidates and officeholders

(a)

In General— Section 323(e)(1) of the Federal Election Campaign Act of 1971 (52 U.S.C. 30125(e)(1)) is amended—

(1)

by striking “or” at the end of subparagraph (A);

(2)

by striking the period at the end of subparagraph (B) and inserting “; or”; and

(3)

by adding at the end the following new subparagraph:

“(C) solicit, receive, direct, or transfer funds to or on behalf of any political committee which accepts donations or contributions that do not comply with the limitations, prohibitions, and reporting requirements of this Act (or to or on behalf of any account of a political committee which is established for the purpose of accepting such donations or contributions), or to or on behalf of any political organization under section 527 of the Internal Revenue Code of 1986 which accepts such donations or contributions (other than a committee of a State or local political party or a candidate for election for State or local office).”

(b)

Effective Date— The amendment made by subsection (a) shall apply with respect to elections occurring after January 1, 2020.

C Severability

Sec. 5201 Severability

Lineage

Mar 7, 2019viewing Introduced in House Mr. Fitzpatrick introduced the following bill; which was referred to the Committee on House Administration, and in addition to the Committees on Science, Space, and Technology, the Judiciary, Homeland Security, Intelligence (Permanent Select), Ways and Means, Financial Services, Oversight and Reform, and Ethics, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned