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H.R. 5175 (111th): Democracy is Strengthened by Casting Light on Spending in Elections Act


The text of the bill below is as of May 25, 2010 (Reported by House Committee).


IB

Union Calendar No. 280

111th CONGRESS

2d Session

H. R. 5175

[Report No. 111–492, Part I]

IN THE HOUSE OF REPRESENTATIVES

April 29, 2010

(for himself, Mr. Castle, Mr. Brady of Pennsylvania, and Mr. Jones) introduced the following bill; which was referred to the Committee on House Administration, and in addition to the Committee on the Judiciary, 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

May 25, 2010

Additional sponsors: Mr. Heinrich, Mr. Clyburn, Mr. George Miller of California, Mr. Ellsworth, Mr. Shuler, Mr. Braley of Iowa, Mr. Larson of Connecticut, Mr. Becerra, Ms. DeLauro, Mr. Waxman, Mr. Conyers, Mr. Nadler of New York, Mr. Skelton, Mr. Bishop of New York, Mr. Larsen of Washington, Mr. Schiff, Mr. Deutch, Mr. McGovern, Mr. Hinchey, Mr. McDermott, Mr. Tonko, Ms. Norton, Ms. Edwards of Maryland, Mr. Andrews, Ms. Hirono, Mr. Stark, Mrs. Maloney, Mr. Holt, Mr. Walz, Mr. Teague, Mr. Boswell, Ms. Matsui, Mr. Farr, Mr. Garamendi, Mr. Kagen, Mr. Pallone, Ms. Zoe Lofgren of California, Mr. Loebsack, Mr. Yarmuth, Ms. Harman, Ms. Chu, Mr. Israel, Mr. Schauer, Mrs. Capps, Ms. McCollum, Ms. Slaughter, Mr. Ellison, Mr. Patrick J. Murphy of Pennsylvania, Ms. Wasserman Schultz, Mr. Sarbanes, Mr. Salazar, Mr. Levin, Mr. Polis of Colorado, Mr. Rothman of New Jersey, Ms. Berkley, Ms. Giffords, Mr. Hare, Mr. Kissell, Mr. Hall of New York, Mr. Schrader, Mr. Arcuri, Ms. Shea-Porter, Mr. Kind, Ms. Kilroy, Mr. Jackson of Illinois, Mr. Perriello, Ms. Sutton, Mr. Foster, Mr. Serrano, Mr. Courtney, Mr. Cohen, Mr. Boccieri, Ms. Titus, Ms. Waters, Mr. Reyes, Mr. Luján, Ms. Roybal-Allard, Mr. Mollohan, Mr. Pierluisi, Mr. Filner, Mr. Dingell, Mr. Lipinski, Mr. Welch, Ms. Linda T. Sánchez of California, Mr. Visclosky, Mr. Smith of Washington, Mr. Chandler, Mr. Blumenauer, Mr. Pomeroy, Ms. Loretta Sanchez of California, Mr. Himes, Mrs. Davis of California, Ms. Speier, Mr. Tierney, Ms. Schakowsky, Mr. Inslee, Mr. Etheridge, Mr. Meek of Florida, Mr. Ackerman, Mr. Price of North Carolina, Mr. Hodes, Ms. Castor of Florida, Mr. Moran of Virginia, Mrs. McCarthy of New York, Mr. Carnahan, Ms. Clarke, Ms. Moore of Wisconsin, Mr. Thompson of California, Mr. Sherman, Mr. Langevin, and Ms. Eshoo

May 25, 2010

Reported from the Committee on House Administration with an amendment

Strike out all after the enacting clause and insert the part printed in italic

May 25, 2010

Committee on the Judiciary discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed

For text of introduced bill, see copy of bill as introduced on April 29, 2010

A BILL

To amend the Federal Election Campaign Act of 1971 to prohibit foreign influence in Federal elections, to prohibit government contractors from making expenditures with respect to such elections, and to establish additional disclosure requirements with respect to spending in such elections, and for other purposes.


1.

Short title; table of contents

(a)

Short title

This Act may be cited as the Democracy is Strengthened by Casting Light on Spending in Elections Act or the DISCLOSE Act.

(b)

Table of contents

The table of contents of this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings.

Title I—Regulation of Certain Political Spending

Sec. 101. Prohibiting independent expenditures and electioneering communications by government contractors.

Sec. 102. Application of ban on contributions and expenditures by foreign nationals to foreign-controlled domestic corporations.

Sec. 103. Treatment of payments for coordinated communications as contributions.

Sec. 104. Treatment of political party communications made on behalf of candidates.

Sec. 105. Restriction on internet communications treated as public communications.

Title II—Promoting Effective Disclosure of Campaign-Related Activity

Subtitle A—Treatment of Independent Expenditures and Electioneering Communications Made by All Persons

Sec. 201. Independent expenditures.

Sec. 202. Electioneering communications.

Sec. 203. Mandatory electronic filing by persons making independent expenditures or electioneering communications exceeding $10,000 at any time.

Subtitle B—Expanded Requirements for Corporations and Other Organizations

Sec. 211. Additional information required to be included in reports on disbursements by covered organizations.

Sec. 212. Rules regarding use of general treasury funds by covered organizations for campaign-related activity.

Sec. 213. Optional use of separate account by covered organizations for campaign-related activity.

Sec. 214. Modification of rules relating to disclaimer statements required for certain communications.

Subtitle C—Reporting Requirements for Registered Lobbyists

Sec. 221. Requiring registered lobbyists to report information on independent expenditures and electioneering communications.

Title III—Disclosure by Covered Organizations of Information on Campaign-Related Activity

Sec. 301. Requiring disclosure by covered organizations of information on campaign-related activity.

Title IV—Other Provisions

Sec. 401. Judicial review.

Sec. 402. Severability.

Sec. 403. Effective date.

2.

Findings

(a)

General Findings

Congress finds and declares as follows:

(1)

Throughout the history of the United States, the American people have been rightly concerned about the power of special interests to control our democratic processes. That was true over 100 years ago when Congress first enacted legislation intended to restrict corporate funds from being used in Federal elections, legislation that Congress amended in 1947 to expressly include independent expenditures. The Supreme Court held such legislation to be constitutional in 1990 in Austin v. Michigan Chamber of Commerce (494 U.S. 652) and again in 2003 in McConnell v. F.E.C. (540 U.S. 93).

(2)

The Supreme Court’s decision in Citizens United v. Federal Election Commission on January 21, 2010, invalidated legislation restricting the ability of corporations and labor unions to spend funds from their general treasury accounts to influence the outcome of elections.

(b)

Findings Relating to Government Contractors

Congress finds and declares as follows:

(1)

Government contracting is an activity that is particularly susceptible to improper influence, and to the appearance of improper influence. Government contracts must be awarded based on an objective evaluation of how well bidders or potential contractors meet relevant statutory criteria.

(2)

Independent expenditures and electioneering communications that benefit particular candidates or elected officials or disfavor their opponents can lead to apparent and actual ingratiation, access, influence, and quid pro quo arrangements. Government contracts should be awarded based on an objective application of statutory criteria, not based on other forms of inappropriate or corrupting influence.

(3)

Prohibiting independent expenditures and electioneering communications by persons negotiating for or performing government contracts will prevent government officials involved in or with influence over the contracting process from influencing the contracting process based, consciously or otherwise, on this kind of inappropriate or corrupting influence.

(4)

Prohibiting independent expenditures and electioneering communications by persons negotiating for or performing government contracts will likewise prevent such persons from feeling pressure, whether actually exerted by government officials or not, to make expenditures and to fund communications in order to maximize their chances of receiving contracts, or to match similar expenditures and communications made by their competitors.

(5)

Furthermore, because government contracts often involve large amounts of public money, it is critical that the public perceive that the government contracts are awarded strictly in accordance with prescribed statutory standards, and not based on other forms of inappropriate or corrupting influence. The public’s confidence in government is undermined when corporations that make significant expenditures during Federal election campaigns later receive government funds.

(6)

Prohibiting independent expenditures and electioneering communications by persons negotiating for or performing government contracts will prevent any appearance that government contracts were awarded based in whole or in part on such expenditures or communications, or based on the inappropriate or corrupting influence such expenditures and communications can create and appear to create.

(7)

In these ways, prohibiting independent expenditures and electioneering communications by persons negotiating for or performing government contracts will protect the actual and perceived integrity of the government contracting process.

(8)

Moreover, the risks of waste, fraud and abuse, all resulting in economic losses to taxpayers, are significant when would-be public contractors or applicants for public funds make expenditures in Federal election campaigns in order to affect electoral outcomes.

(c)

Findings Relating to Foreign Corporations

Congress finds and declares as follows:

(1)

The Supreme Court’s decision in the Citizens United case has provided the means by which United States corporations controlled by foreign entities can freely spend money to influence United States elections.

(2)

Foreign corporations commonly own U.S. corporations in whole or in part, and U.S. corporate equity and debt are also held by foreign individuals, sovereign wealth funds, and even foreign nations at levels which permit effective control over those U.S. entities.

(3)

As recognized in many areas of the law, foreign ownership interests and influences are exerted in a perceptible way even when the entity is not majority-foreign-owned.

(4)

The Federal Government has broad constitutional power to protect American interests and sovereignty from foreign interference and intrusion.

(5)

Congress has a clear interest in minimizing foreign intervention, and the perception of foreign intervention, in United States elections.

(d)

Findings Relating to Coordinated Expenditures

Congress finds and declares as follows:

(1)

It has been the consistent view of Congress and the courts that coordinated expenditures in campaigns for election are no different in nature from contributions.

(2)

Existing rules still allow donors to evade contribution limits by making campaign expenditures which, while technically qualifying as independent expenditures under law, are for all relevant purposes coordinated with candidates and political parties and thus raise the potential for corruption or the appearance of corruption.

(3)

Such arrangements have the potential to give rise to the reality or appearance of corruption to the same degree that direct contributions to a candidate may give rise to the reality or appearance of corruption. Moreover, expenditures which are in fact made in coordination with a candidate or political party have the potential to lessen the public’s trust and faith in the rules and the integrity of the electoral process.

(4)

The government therefore has a compelling interest in making sure that expenditures that are de facto coordinated with a candidate are treated as such to prevent corruption, the appearance of corruption, or the perception that some participants are circumventing the laws and regulations which govern the financing of election campaigns.

(e)

Findings Relating to Disclosures and Disclaimers

Congress finds and declares as follows:

(1)

The American people have a compelling interest in knowing who is funding independent expenditures and electioneering communications to influence Federal elections, and the government has a compelling interest in providing the public with that information. Effective disclaimers and prompt disclosure of expenditures, and the disclosure of the funding sources for these expenditures, can provide shareholders, voters, and citizens with the information needed to evaluate the actions by special interests seeking influence over the democratic process. Transparency promotes accountability, increases the fund of information available to the public concerning the support given to candidates by special interests, sheds the light of publicity on political spending, and encourages the leaders of organizations to act only upon legitimate organizational purposes.

(2)

Protecting this compelling interest has become particularly important to address the anticipated increase in special interest spending on election-related communications which will result from the Supreme Court’s decision in the Citizens United case. The current disclosure and disclaimer requirements were designed for a campaign finance system in which such expenditures were subject to prohibitions that no longer apply.

(3)

More rigorous disclosure and disclaimer requirements are necessary to protect against the evasion of current rules. Organizations that engage in election-related communications have used a variety of methods to attempt to obscure their sponsorship of communications from the general public. Robust disclosure and disclaimer requirements are necessary to ensure that the electorate is informed about who is paying for particular election-related communications, and so that the shareholders and members of these organizations are aware of their organizations’ election-related spending.

(4)

The current lack of accountability and transparency allow special interest political spending to serve as a private benefit for the officials of special interest organizations, to the detriment of the organizations and their shareholders and members.

(5)

Various factors, including the advent of the Internet, where particular communications can be circulated and remain available for viewing long after they are first broadcast, and the frequency of political campaigns that effectively begin long before election day, have also rendered the existing system of disclosure and disclaimer requirements (including the limited time periods during which some of those requirements currently apply) inadequate to protect fully the government’s interest in ensuring that the electorate is fully informed about the sources of election-related spending, and that shareholders and citizens alike have the information they need to hold corporations and elected officials accountable for their positions and supporters.

(6)

To serve the interests of accountability and transparency, it is also important that information about who is funding independent expenditures and electioneering communications be presented to the electorate in a manner that is readily accessible and that can be quickly and easily understood.

(f)

Findings Relating to Campaign Spending by Lobbyists

Congress finds and declares as follows:

(1)

Lobbyists and lobbying organizations, and through them, their clients, influence the public decision-making process in a variety of ways.

(2)

In recent years, scandals involving undue lobbyist influence have lowered public trust in government and jeopardized the willingness of voters to take part in democratic governance.

(3)

One way in which lobbyists may unduly influence Federal officials is through their or their clients making independent expenditures or electioneering communications targeting elected officials.

(4)

Disclosure of such independent expenditures and electioneering communications will allow the public to examine connections between such spending and official actions, and will therefore limit the ability of lobbyists to exert an undue influence on elected officials.

I

Regulation of Certain Political Spending

101.

Prohibiting independent expenditures and electioneering communications by government contractors

(a)

Prohibition Applicable to Government Contractors

(1)

Prohibition

(A)

In general

Section 317(a)(1) of the Federal Election Campaign Act (2 U.S.C. 441c(a)(1)) is amended by striking purpose or use; or and inserting the following: purpose or use, to make any independent expenditure, or to disburse any funds for an electioneering communication; or.

(B)

Conforming amendment

The heading of section 317 of such Act (2 U.S.C. 441c) is amended by striking contributions and inserting contributions, independent expenditures, and electioneering communications.

(2)

Threshold for application of ban

Section 317 of such Act (2 U.S.C. 441c) is amended—

(A)

by redesignating subsections (b) and (c) as subsections (c) and (d); and

(B)

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

(b)

To the extent that subsection (a)(1) prohibits a person who enters into a contract described in such subsection from making any independent expenditure or disbursing funds for an electioneering communication, such subsection shall apply only if the value of the contract is equal to or greater than $7,000,000.

.

(b)

Application to recipients of assistance under troubled asset program

Section 317(a) of such Act (2 U.S.C. 441c(a)) is amended—

(1)

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

(2)

by redesignating paragraph (2) as paragraph (3); and

(3)

by inserting after paragraph (1) the following new paragraph:

(2)

who enters into negotiations for financial assistance under title I of the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5211 et seq.) (relating to the purchase of troubled assets by the Secretary of the Treasury), during the period—

(A)

beginning on the later of the commencement of the negotiations or the date of the enactment of the Democracy is Strengthened by Casting Light on Spending in Elections Act; and

(B)

ending with the later of the termination of such negotiations or the repayment of such financial assistance;

directly or indirectly to make any contribution of money or other things of value, or to promise expressly or impliedly to make any such contribution to any political party, committee, or candidate for public office or to any person for any political purpose or use, to make any independent expenditure, or to disburse any funds for an electioneering communication; or

.

(c)

Technical amendment

Section 317 of such Act (2 U.S.C. 441c) is amended by striking section 321 each place it appears and inserting section 316.

102.

Application of ban on contributions and expenditures by foreign nationals to foreign-controlled domestic corporations

(a)

Application of ban

Section 319(b) of the Federal Election Campaign Act of 1971 (2 U.S.C. 441e(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 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 20 percent or more of the voting shares;

(B)

with respect to which the majority of the members of the board of directors are foreign nationals described in paragraph (1) or (2);

(C)

over which one or more foreign nationals described in paragraph (1) or (2) has the power to direct, dictate, or control the decision-making process of the corporation 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 decision-making process of the corporation 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 (2 U.S.C. 441e) 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 during a year, 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), shall file a certification with the Commission, under penalty of perjury, that the corporation is not prohibited from carrying out such activity under subsection (b)(3), unless the chief executive officer has previously filed such a certification during the year. Nothing in this subsection shall be construed to apply to any contribution, donation, expenditure, independent expenditure, or disbursement from a separate segregated fund established and administered by a corporation under section 316(b)(2)(C).

.

(c)

No Effect on Separate Segregated Funds of Domestic Corporations

Section 319 of such Act (2 U.S.C. 441e), as amended by subsection (b), is further amended by adding at the end the following new subsection:

(d)

No Effect on Separate Segregate Funds of Domestic Corporations

Nothing in this section shall be construed to prohibit any corporation which is not a foreign national described in paragraph (1) of subsection (b) from establishing, administering, and soliciting contributions to a separate segregated fund under section 316(b)(2)(C), so long as none of the amounts in the fund are provided by any foreign national described in paragraph (1) or (2) of subsection (b) and no foreign national described in paragraph (1) or (2) of subsection (b) has the power to direct, dictate, or control the establishment or administration of the fund.

.

(d)

No Effect on Other Laws

Section 319 of such Act (2 U.S.C. 441e), as amended by subsections (b) and (c), is further amended by adding at the end the following new subsection:

(e)

No Effect on Other Laws

Nothing in this section shall be construed to affect the determination of whether a corporation is treated as a foreign national for purposes of any law other than this Act.

.

103.

Treatment of payments for coordinated communications as contributions

(a)

In general

Section 301(8)(A) of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(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 communication (as determined under section 324).

.

(b)

Coordinated communications described

Section 324 of such Act (2 U.S.C. 441k) is amended to read as follows:

324.

Coordinated communications

(a)

Coordinated Communications Defined

For purposes of this Act, the term coordinated communication means—

(1)

a covered communication which, subject to subsection (c), is made in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate, an authorized committee of a candidate, or a political committee of a political party; or

(2)

any communication that republishes, disseminates, or distributes, in whole or in part, any broadcast or any written, graphic, or other form of campaign material prepared by a candidate, an authorized committee of a candidate, or their agents.

(b)

Covered communication defined

(1)

In general

Except as provided in paragraph (4), for purposes of this subsection, the term covered communication means, for purposes of the applicable election period described in paragraph (2), a public communication (as defined in section 301(22)) that refers to a clearly identified candidate for Federal office and is publicly distributed or publicly disseminated during such period.

(2)

Applicable election period

For purposes of paragraph (1), the applicable election period with respect to a communication means—

(A)

in the case of a communication which refers to a candidate for the office of President or Vice President, the period—

(i)

beginning with the date that is 120 days before the date of the first primary election, preference election, or nominating convention for nomination for the office of President which is held in any State; and

(ii)

ending with the date of the general election for such office; or

(B)

in the case of a communication which refers to a candidate for any other Federal office, the period—

(i)

beginning with the date that is 90 days before the earliest of the primary election, preference election, or nominating convention with respect to the nomination for the office that the candidate is seeking; and

(ii)

ending with the date of the general election for such office.

(3)

Special rule for public distribution of communications involving Congressional candidates

For purposes of paragraph (1), in the case of a communication involving a candidate for an office other than President or Vice President, the communication shall be considered to be publicly distributed or publicly disseminated only if the dissemination or distribution occurs in the jurisdiction of the office that the candidate is seeking.

(4)

Exception

The term covered communication does not include—

(A)

a communication appearing 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)

a communication which constitutes a candidate debate or forum conducted pursuant to the regulations adopted by the Commission to carry out 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.

(c)

No finding of coordination based solely on sharing of information regarding legislative or policy position

For purposes of subsection (a)(1), a covered communication may not be considered to be made in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate, an authorized committee of a candidate, or a political committee of a political party solely on the grounds that a person provided information to the candidate or committee regarding that person’s position on a legislative or policy matter (including urging the candidate or party to adopt that person’s position), so long as there is no discussion between the person and the candidate or committee regarding the candidate’s campaign for election for Federal office.

(d)

Preservation of Certain Safe Harbors and Firewalls

Nothing in this section may be construed to affect 11 CFR 109.21(g) or (h), as in effect on the date of the enactment of the Democracy is Strengthened by Casting Light on Spending in Elections Act.

(e)

Treatment of coordination with political parties for communications referring to candidates

For purposes of this section, if a communication which refers to any clearly identified candidate or candidates of a political party or any opponent of such a candidate or candidates is determined to have been made in cooperation, consultation, or concert with or at the request or suggestion of a political committee of the political party but not in cooperation, consultation, or concert with or at the request or suggestion of such clearly identified candidate or candidates, the communication shall be treated as having been made in cooperation, consultation, or concert with or at the request or suggestion of the political committee of the political party but not with or at the request or suggestion of such clearly identified candidate or candidates.

.

(c)

Effective Date

(1)

In general

This section and the amendments made by this section shall apply with respect to payments made on or after the expiration of the 30-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 to carry out such amendments.

(2)

Transition rule for actions taken prior to enactment

No person shall be considered to have made a payment for a coordinated communication under section 324 of the Federal Election Campaign Act of 1971 (as amended by subsection (b)) by reason of any action taken by the person prior to the date of the enactment of this Act. Nothing in the previous sentence shall be construed to affect any determination under any other provision of such Act which is in effect on the date of the enactment of this Act regarding whether a communication is made in cooperation, consultation, or concert with, or at the request or suggestion of, a candidate, an authorized committee of a candidate, or a political committee of a political party.

104.

Treatment of political party communications made on behalf of candidates

(a)

Treatment of Payment for Public Communication as Contribution if Made Under control or direction of Candidate

Section 301(8)(A) of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(8)(A)), as amended by section 103(a), is amended—

(1)

by striking or at the end of clause (ii);

(2)

by striking the period at the end of clause (iii) and inserting ; or; and

(3)

by adding at the end the following new clause:

(iv)

any payment by a political committee of a political party for the direct costs of a public communication (as defined in paragraph (22)) made on behalf of a candidate for Federal office who is affiliated with such party, but only if the communication is controlled by, or made at the direction of, the candidate or an authorized committee of the candidate.

.

(b)

Requiring control or direction by candidate for treatment as coordinated party expenditure

(1)

In general

Paragraph (4) of section 315(d) of such Act (2 U.S.C. 441a(d)) is amended to read as follows:

(4)

Special rule for direct costs of communications

The direct costs incurred by a political committee of a political party for a communication made in connection with the campaign of a candidate for Federal office shall not be subject to the limitations contained in paragraphs (2) and (3) unless the communication is controlled by, or made at the direction of, the candidate or an authorized committee of the candidate.

.

(2)

Conforming amendment

Paragraph (1) of section 315(d) of such Act (2 U.S.C. 441a(d)) is amended by striking paragraphs (2), (3), and (4) and inserting paragraphs (2) and (3).

(c)

Effective Date

This section and the amendments made by this section shall apply with respect to payments made on or after the expiration of the 30-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 to carry out such amendments.

105.

Restriction on internet communications treated as public communications

(a)

In General

Section 301(22) of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(22)) is amended by adding at the end the following new sentence: A communication which is disseminated through the Internet shall not be treated as a form of general public political advertising under this paragraph unless the communication was placed for a fee on another person’s Web site..

(b)

Effective Date

The amendment made by subsection (a) shall take effect on the date of the enactment of this Act.

II

Promoting Effective Disclosure of Campaign-Related Activity

A

Treatment of Independent Expenditures and Electioneering Communications Made by All Persons

201.

Independent expenditures

(a)

Revision of Definition

Subparagraph (A) of section 301(17) of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(17)) is amended to read as follows:

(A)

that, when taken as a whole, expressly advocates the election or defeat of a clearly identified candidate, or is the functional equivalent of express advocacy because it can be interpreted by a reasonable person only as advocating the election or defeat of a candidate, taking into account whether the communication involved mentions a candidacy, a political party, or a challenger to a candidate, or takes a position on a candidate’s character, qualifications, or fitness for office; and

.

(b)

Uniform 24-Hour Reporting For Persons Making Independent Expenditures Exceeding $10,000 at Any Time

Section 304(g) of such Act (2 U.S.C. 434(g)) is amended by striking paragraphs (1) and (2) and inserting the following:

(1)

Independent expenditures exceeding threshold amount

(A)

Initial report

A person (including a political committee) that makes or contracts to make independent expenditures in an aggregate amount equal to or greater than the threshold amount described in paragraph (2) shall electronically file a report describing the expenditures within 24 hours.

(B)

Additional reports

After a person files a report under subparagraph (A), the person shall electronically file an additional report within 24 hours after each time the person makes or contracts to make independent expenditures in an aggregate amount equal to or greater than the threshold amount with respect to the same election as that to which the initial report relates.

(2)

Threshold amount described

In paragraph (1), the threshold amount means—

(A)

during the period up to and including the 20th day before the date of an election, $10,000; or

(B)

during the period after the 20th day, but more than 24 hours, before the date of an election, $1,000.

(3)

Public availability

Notwithstanding any other provision of this section, the Commission shall ensure that the information required to be disclosed under this subsection is publicly available through the Commission website not later than 24 hours after receipt in a manner that is downloadable in bulk and machine readable.

.

(c)

Effective date

(1)

In general

The amendment made by subsection (a) shall apply with respect to contributions and expenditures made on or after the expiration of the 30-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 to carry out such amendments.

(2)

Reporting requirements

The amendment made by subsection (b) shall apply with respect to reports required to be filed after the date of the enactment of this Act.

202.

Electioneering communications

(a)

Expansion of period covering general election

Section 304(f)(3)(A)(i)(II)(aa) of the Federal Election Campaign Act of 1971 (2 U.S.C. 434(f)(3)(A)(i)(II)(aa)) is amended by striking 60 days and inserting 120 days.

(b)

Mandatory electronic filing

Section 304(f)(1) of such Act (2 U.S.C. 434(f)(1)) is amended—

(1)

by striking file with and inserting electronically file with; and

(2)

by adding at the end the following new sentence: Notwithstanding any other provision of this section, the Commission shall ensure that the information required to be disclosed under this subsection is publicly available through the Commission website not later than 24 hours after receipt in a manner that is downloadable in bulk and machine readable..

(c)

Effective date; transition for communications made prior to enactment

The amendment made by subsection (a) shall apply with respect to communications made on or after the date of the enactment of this Act, without regard to whether or not the Federal Election Commission has promulgated regulations to carry out such amendments, except that no communication which is made prior to the date of the enactment of this Act shall be treated as an electioneering communication under section 304(f)(3)(A)(i)(II) of the Federal Election Campaign Act of 1971 (as amended by subsection (a)) unless the communication would be treated as an electioneering communication under such section if the amendment made by subsection (a) did not apply.

203.

Mandatory electronic filing by persons making independent expenditures or electioneering communications exceeding $10,000 at any time

Section 304(d)(1) of the Federal Election Campaign Act of 1971 (2 U.S.C. 434(d)(1)) is amended—

(1)

by striking or (g); and

(2)

by adding at the end the following: Notwithstanding any other provision of this section, any person who is required to file a statement under subsection (f) or subsection (g) shall file the statement in electronic form accessible by computers, in a manner which ensures that the information provided is searchable, sortable, and downloadable..

B

Expanded Requirements for Corporations and Other Organizations

211.

Additional information required to be included in reports on disbursements by covered organizations

(a)

Independent expenditure reports

Section 304(g) of the Federal Election Campaign Act of 1971 (2 U.S.C. 434(g)) is amended by adding at the end the following new paragraph:

(5)

Disclosure of additional information by covered organizations making payments for public independent expenditures

(A)

Additional information

If a covered organization makes or contracts to make public independent expenditures in an aggregate amount equal to or exceeding $10,000 in a calendar year, the report filed by the organization under this subsection shall include, in addition to the information required under paragraph (3), the following information:

(i)

If any person made a donation or payment to the covered organization during the covered organization reporting period which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity—

(I)

subject to subparagraph (C), the identification of each person who made such donations or payments in an aggregate amount equal to or exceeding $600 during such period, presented in the order of the aggregate amount of donations or payments made by such persons during such period (with the identification of the person making the largest donation or payment appearing first); and

(II)

if any person identified under subclause (I) designated that the donation or payment be used for campaign-related activity with respect to a specific election or in support of a specific candidate, the name of the election or candidate involved, and if any such person designated that the donation or payment be used for a specific public independent expenditure, a description of the expenditure.

(ii)

The identification of each person who made unrestricted donor payments to the organization during the covered organization reporting period—

(I)

in an aggregate amount equal to or exceeding $600 during such period, if any of the disbursements made by the organization for any of the public independent expenditures which are covered by the report were not made from the organization’s Campaign-Related Activity Account under section 326; or

(II)

in an aggregate amount equal to or exceeding $6,000 during such period, if the disbursements made by the organization for all of the public independent expenditures which are covered by the report were made exclusively from the organization’s Campaign-Related Activity Account under section 326 (but only if the organization has made deposits described in subparagraph (D) of section 326(a)(2) into that Account during such period in an aggregate amount equal to or greater than $10,000),

presented in the order of the aggregate amount of payments made by such persons during such period (with the identification of the person making the largest payment appearing first).
(B)

Treatment of transfers made to other persons

(i)

In general

For purposes of the requirement to file reports under this subsection (including the requirement under subparagraph (A) to include additional information in such reports), a covered organization which transfers amounts to another person (other than the covered organization itself) for the purpose of making a public independent expenditure by that person or by any other person, or (in accordance with clause (ii)) which is deemed to have transferred amounts to another person (other than the covered organization itself) for the purpose of making a public independent expenditure by that person or by any other person, shall be considered to have made a public independent expenditure.

(ii)

Rules for deeming transfers made for purpose of making expenditures

For purposes of clause (i), in determining whether a covered organization or any other person who transfers amounts to another person shall be deemed to have transferred the amounts for the purpose of making a public independent expenditure, the following rules apply:

(I)

The person shall be deemed to have transferred the amounts for the purpose of making a public independent expenditure if—

(aa)

the person designates, requests, or suggests that the amounts be used for public independent expenditures and the person to whom the amounts were transferred agrees to do so or does so;

(bb)

the person making the public independent expenditure or another person acting on that person’s behalf expressly solicited the person for a donation or payment for making or paying for any public independent expenditures;

(cc)

the person and the person to whom the amounts were transferred engaged in substantial written or oral discussion regarding the person either making, or donating or paying for, any public independent expenditures;

(dd)

the person or the person to whom the amounts were transferred knew or had reason to know of the covered organization’s intent to make public independent expenditures; or

(ee)

the person or the person to whom the amounts were transferred made a public independent expenditure during the 2-year period which ends on the date on which the amounts were transferred.

(II)

The person shall not be deemed to have transferred the amounts for the purpose of making a public independent expenditure if the transfer was a commercial transaction occurring in the ordinary course of business between the person and the person to whom the amounts were transferred, unless there is affirmative evidence that the amounts were transferred for the purpose of making a public independent expenditure.

(C)

Exclusion of amounts designated for other campaign-related activity

For purposes of subparagraph (A)(i), in determining the amount of a donation or payment made by a person which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity, there shall be excluded any amount which was designated by the person to be used—

(i)

for campaign-related activity described in clause (i) of section 325(d)(2)(A) (relating to independent expenditures) with respect to a different election, or with respect to a candidate in a different election, than an election which is the subject of any of the public independent expenditures covered by the report involved; or

(ii)

for any campaign-related activity described in clause (ii) of section 325(d)(2)(A) (relating to electioneering communications).

(D)

Exclusion of amounts paid from separate segregated fund

In determining the amount of public independent expenditures made by a covered organization for purposes of this paragraph, there shall be excluded any amounts paid from a separate segregated fund established and administered by the organization under section 316(b)(2)(C).

(E)

Covered organization reporting period described

In this paragraph, the covered organization reporting period is, with respect to a report filed by a covered organization under this subsection—

(i)

in the case of the first report filed by a covered organization under this subsection which includes information required under this paragraph, the shorter of—

(I)

the period which begins on the effective date of the Democracy is Strengthened by Casting Light on Spending in Elections Act and ends on the last day covered by the report, or

(II)

the 12-month period ending on the last day covered by the report; and

(ii)

in the case of any subsequent report filed by a covered organization under this subsection which includes information required under this paragraph, the period occurring since the most recent report filed by the organization which includes such information.

(F)

Covered organization defined

In this paragraph, the term covered organization means any of the following:

(i)

Any corporation which is subject to section 316(a).

(ii)

Any labor organization (as defined in section 316).

(iii)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(iv)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

(G)

Other definitions

In this paragraph—

(i)

the terms campaign-related activity and unrestricted donor payment have the meaning given such terms in section 325; and

(ii)

the term public independent expenditure means an independent expenditure for a public communication (as defined in section 301(22)).

.

(b)

Electioneering communication reports

(1)

In general

Section 304(f) of such Act (2 U.S.C. 434(f)) is amended—

(A)

by redesignating paragraphs (6) and (7) as paragraphs (7) and (8); and

(B)

by inserting after paragraph (5) the end the following new paragraph:

(6)

Disclosure of additional information by covered organizations

(A)

Additional information

If a covered organization files a statement under this subsection, the statement shall include, in addition to the information required under paragraph (2), the following information:

(i)

If any person made a donation or payment to the covered organization during the covered organization reporting period which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity—

(I)

subject to subparagraph (C), the identification of each person who made such donations or payments in an aggregate amount equal to or exceeding $1,000 during such period, presented in the order of the aggregate amount of donations or payments made by such persons during such period (with the identification of the person making the largest donation or payment appearing first); and

(II)

if any person identified under subclause (I) designated that the donation or payment be used for campaign-related activity with respect to a specific election or in support of a specific candidate, the name of the election or candidate involved, and if any such person designated that the donation or payment be used for a specific electioneering communication, a description of the communication.

(ii)

The identification of each person who made unrestricted donor payments to the organization during the covered organization reporting period—

(I)

in an aggregate amount equal to or exceeding $1,000 during such period, if any of the disbursements made by the organization for any of the electioneering communications which are covered by the statement were not made from the organization’s Campaign-Related Activity Account under section 326; or

(II)

in an aggregate amount equal to or exceeding $10,000 during such period, if the disbursements made by the organization for all of the electioneering communications which are covered by the statement were made exclusively from the organization’s Campaign-Related Activity Account under section 326 (but only if the organization has made deposits described in subparagraph (D) of section 326(a)(2) into that Account during such period in an aggregate amount equal to or greater than $10,000),

presented in the order of the aggregate amount of payments made by such persons during such period (with the identification of the person making the largest payment appearing first).
(B)

Treatment of transfers made to other persons

(i)

In general

For purposes of the requirement to file statements under this subsection (including the requirement under subparagraph (A) to include additional information in such statements), a covered organization which transfers amounts to another person (other than the covered organization itself) for the purpose of making an electioneering communication by that person or by any other person, or (in accordance with clause (ii)) which is deemed to have transferred amounts to another person (other than the covered organization itself) for the purpose of making an electioneering communication by that person or by any other person, shall be considered to have made a disbursement for an electioneering communication.

(ii)

Rules for deeming transfers made for purpose of making communications

For purposes of clause (i), in determining whether a covered organization or any other person who transfers amounts to another person shall be deemed to have transferred the amounts for the purpose of making an electioneering communication, the following rules apply:

(I)

The person shall be deemed to have transferred the amounts for the purpose of making an electioneering communication if—

(aa)

the person designates, requests, or suggests that the amounts be used for electioneering communications and the person to whom the amounts were transferred agrees to do so or does so;

(bb)

the person making the electioneering communication or another person acting on that person’s behalf expressly solicited the person for a donation or payment for making or paying for any electioneering communications;

(cc)

the person and the person to whom the amounts were transferred engaged in substantial written or oral discussion regarding the person either making, or donating or paying for, any electioneering communications;

(dd)

the person or the person to whom the amounts were transferred knew or had reason to know of the covered organization’s intent to make electioneering communications; or

(ee)

the person or the person to whom the amounts were transferred made an electioneering communication during the 2-year period which ends on the date on which the amounts were transferred.

(II)

The person shall not be considered to have transferred the amounts for the purpose of making an electioneering communication if the transfer was a commercial transaction occurring in the ordinary course of business between the person and the person to whom the amounts were transferred, unless there is affirmative evidence that the amounts were transferred for the purpose of making an electioneering communication.

(C)

Exclusion of amounts designated for other campaign-related activity

For purposes of subparagraph (A)(i), in determining the amount of a donation or payment made by a person which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity, there shall be excluded any amount which was designated by the person to be used—

(i)

for campaign-related activity described in clause (ii) of section 325(d)(2)(A) (relating to electioneering communications) with respect to a different election, or with respect to a candidate in a different election, than an election which is the subject of any of the electioneering communications covered by the statement involved; or

(ii)

for any campaign-related activity described in clause (i) of section 325(d)(2)(A) (relating to independent expenditures consisting of a public communication).

(D)

Covered organization reporting period described

In this paragraph, the covered organization reporting period is, with respect to a statement filed by a covered organization under this subsection—

(i)

in the case of the first statement filed by a covered organization under this subsection which includes information required under this paragraph, the shorter of—

(I)

the period which begins on the effective date of the Democracy is Strengthened by Casting Light on Spending in Elections Act and ends on the disclosure date for the statement, or

(II)

the 12-month period ending on the disclosure date for the statement; and

(ii)

in the case of any subsequent statement filed by a covered organization under this subsection which includes information required under this paragraph, the period occurring since the most recent statement filed by the organization which includes such information.

(E)

Covered organization defined

In this paragraph, the term covered organization means any of the following:

(i)

Any corporation which is subject to section 316(a).

(ii)

Any labor organization (as defined in section 316).

(iii)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(iv)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

(F)

Other definitions

In this paragraph, the terms campaign-related activity and unrestricted donor payment have the meaning given such terms in section 325.

.

(2)

Conforming amendment

Section 304(2) of such Act (2 U.S.C. 434(f)(2)) is amended by striking If the disbursements each place it appears in subparagraph (E) and (F) and inserting the following: Except in the case of a statement which is required to include additional information under paragraph (6), if the disbursements.

212.

Rules regarding use of general treasury funds by covered organizations for campaign-related activity

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

325.

Special rules for use of general treasury funds by covered organizations for campaign-related activity

(a)

Use of Funds for Campaign-Related Activity

(1)

In general

Subject to any applicable restrictions and prohibitions under this Act, a covered organization may make disbursements for campaign-related activity using—

(A)

amounts paid or donated to the organization which are designated by the person providing the amounts to be used for campaign-related activity;

(B)

unrestricted donor payments made to the organization; and

(C)

other funds of the organization, including amounts received pursuant to commercial activities in the regular course of a covered organization’s business.

(2)

No effect on use of separate segregated fund

Nothing in this section shall be construed to affect the authority of a covered organization to make disbursements from a separate segregated fund established and administered by the organization under section 316(b)(2)(C).

(b)

Mutually Agreed Restrictions on Use of Funds for Campaign-Related Activity

(1)

Agreement and certification

If a covered organization and a person mutually agree, at the time the person makes a donation, payment, or transfer to the organization which would require the organization to disclose the person’s identification under section 304(g)(5)(A)(ii) or section 304(f)(6)(A)(ii), that the organization will not use the donation, payment, or transfer for campaign-related activity, then not later than 30 days after the organization receives the donation, payment, or transfer the organization shall transmit to the person a written certification by the chief financial officer of the covered organization (or, if the organization does not have a chief financial officer, the highest ranking financial official of the organization) that—

(A)

the organization will not use the donation, payment, or transfer for campaign-related activity; and

(B)

the organization will not include any information on the person in any report filed by the organization under section 304 with respect to independent expenditures or electioneering communications, so that the person will not be required to appear in a significant funder statement or a Top 5 Funders list under section 318(e).

(2)

Exception for payments made pursuant to commercial activities

Paragraph (1) does not apply with respect to any payment or transfer made pursuant to commercial activities in the regular course of a covered organization’s business.

(c)

Certifications Regarding Disbursements for Campaign-Related Activity

(1)

Certification by chief executive officer

If, at any time during a calendar quarter, a covered organization makes a disbursement of funds for campaign-related activity using funds described in subsection (a)(1), the chief executive officer of the covered organization or the chief executive officer’s designee (or, if the organization does not have a chief executive officer, the highest ranking official of the organization or the highest ranking official’s designee) shall file a statement with the Commission which contains the following certifications:

(A)

None of the campaign-related activity for which the organization disbursed the funds during the quarter was made in cooperation, consultation, or concert with, or at the request or suggestion of, any candidate or any authorized committee or agent of such candidate, or political committee of a political party or agent of any political party.

(B)

The chief executive officer or highest ranking official of the covered organization (as the case may be) has reviewed and approved each statement and report filed by the organization under section 304 with respect to any such disbursement made during the quarter.

(C)

Each statement and report filed by the organization under section 304 with respect to any such disbursement made during the quarter is complete and accurate.

(D)

All such disbursements made during the quarter are in compliance with this Act.

(E)

No portion of the amounts used to make any such disbursements during the quarter is attributable to funds received by the organization that were restricted by the person who provided the funds from being used for campaign-related activity pursuant to subsection (b).

(2)

Application of electronic filing rules

Section 304(d)(1) shall apply with respect to a statement required under this subsection in the same manner as such section applies with respect to a statement under subsection (c) or (g) of section 304.

(3)

Deadline

The chief executive officer or highest ranking official of a covered organization (as the case may be) shall file the statement required under this subsection with respect to a calendar quarter not later than 15 days after the end of the quarter.

(d)

Definitions

For purposes of this section, the following definitions apply:

(1)

Covered Organization

The term covered organization means any of the following:

(A)

Any corporation which is subject to section 316(a).

(B)

Any labor organization (as defined in section 316).

(C)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(D)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

(2)

Campaign-Related Activity

(A)

In general

The term campaign-related activity means—

(i)

an independent expenditure consisting of a public communication (as defined in section 301(22)), a transfer of funds to another person (other than the transferor itself) for the purpose of making such an independent expenditure by that person or by any other person, or (in accordance with subparagraph (B)) a transfer of funds to another person (other than the transferor itself) which is deemed to have been made for the purpose of making such an independent expenditure by that person or by any other person; or

(ii)

an electioneering communication, a transfer of funds to another person (other than the transferor itself) for the purpose of making an electioneering communication by that person or by any other person, or (in accordance with subparagraph (B)) a transfer of funds to another person (other than the transferor itself)which is deemed to have been made for the purpose of making an electioneering communication by that person or by any other person.

(B)

Rule for deeming transfers made for purpose of campaign-related activity

For purposes of subparagraph (A), in determining whether a transfer of funds by one person to another person shall be deemed to have been made for the purpose of making an independent expenditure consisting of a public communication or an electioneering communication, the following rules apply:

(i)

The transfer shall be deemed to have been made for the purpose of making such an independent expenditure or an electioneering communication if—

(I)

the person designates, requests, or suggests that the amounts be used for such independent expenditures or electioneering communications and the person to whom the amounts were transferred agrees to do so or does so;

(II)

the person making such independent expenditures or electioneering communications or another person acting on that person’s behalf expressly solicited the person for a donation or payment for making or paying for any such independent expenditure or electioneering communication;

(III)

the person and the person to whom the amounts were transferred engaged in substantial written or oral discussion regarding the person either making, or donating or paying for, such independent expenditures or electioneering communications;

(IV)

the person or the person to whom the amounts were transferred knew or had reason to know of the covered organization’s intent to disburse funds for such independent expenditures or electioneering communications; or

(V)

the person or the person to whom the amounts were transferred made such an independent expenditure or electioneering communication during the 2-year period which ends on the date on which the amounts were transferred.

(ii)

The transfer shall not be deemed to have been made for the purpose of making such an independent expenditure or an electioneering communication if the transfer was a commercial transaction occurring in the ordinary course of business between the person and the person to whom the amounts were transferred, unless there is affirmative evidence that the amounts were transferred for the purpose of making such an independent expenditure or electioneering communication.

(3)

Unrestricted donor payment

The term unrestricted donor payment means a payment to a covered organization which consists of a donation or payment from a person other than the covered organization, except that such term does not include—

(A)

any payment made pursuant to commercial activities in the regular course of a covered organization’s business; or

(B)

any donation or payment which is designated by the person making the donation or payment to be used for campaign-related activity or made in response to a solicitation for funds to be used for campaign-related activity.

.

213.

Optional use of separate account by covered organizations for campaign-related activity

Title III of the Federal Election Campaign Act of 1971 (2 U.S.C. 431 et seq.), as amended by section 212, is further amended by adding at the end the following new section:

326.

Optional Use of Separate Account by Covered Organizations for Campaign-Related Activity

(a)

Optional Use of Separate Account

(1)

Establishment of account

(A)

In general

At its option, a covered organization may make disbursements for campaign-related activity using amounts from a bank account established and controlled by the organization to be known as the Campaign-Related Activity Account (hereafter in this section referred to as the Account), which shall be maintained separately from all other accounts of the organization and which shall consist exclusively of the deposits described in paragraph (2).

(B)

Mandatory use of account after establishment

If a covered organization establishes an Account under this section, it may not make disbursements for campaign-related activity from any source other than amounts from the Account.

(C)

Exclusive use of account for campaign-related activity

Amounts in the Account shall be used exclusively for disbursements by the covered organization for campaign-related activity. After such disbursements are made, information with respect to deposits made to the Account shall be disclosed in accordance with section 304(g)(5) or section 304(f)(6).

(2)

Deposits described

The deposits described in this paragraph are deposits of the following amounts:

(A)

Amounts donated or paid to the covered organization by a person other than the organization for the purpose of being used for campaign-related activity, and for which the person providing the amounts has designated that the amounts be used for campaign-related activity with respect to a specific election or specific candidate.

(B)

Amounts donated or paid to the covered organization by a person other than the organization for the purpose of being used for campaign-related activity, and for which the person providing the amounts has not designated that the amounts be used for campaign-related activity with respect to a specific election or specific candidate.

(C)

Amounts donated or paid to the covered organization by a person other than the organization in response to a solicitation for funds to be used for campaign-related activity.

(D)

Amounts transferred to the Account by the covered organization from other accounts of the organization, including from the organization’s general treasury funds.

(3)

No treatment as political committee

The establishment and administration of an Account in accordance with this subsection shall not by itself be treated as the establishment or administration of a political committee for any purpose of this Act.

(b)

Reduction in amounts otherwise available for Account in Response to Demand of General Donors

(1)

In general

If a covered organization which has established an Account obtains any revenues during a year which are attributable to a donation or payment from a person other than the covered organization, and if any person who makes such a donation or payment to the organization notifies the organization in writing (at the time of making the donation or payment) that the organization may not use the donation or payment for campaign-related activity, the organization shall reduce the amount of its revenues available for deposits to the Account which are described in subsection (a)(3)(D) during the year by the amount of the donation or payment.

(2)

Exception

Paragraph (1) does not apply with respect to any payment made pursuant to commercial activities in the regular course of a covered organization’s business.

(c)

Covered Organization Defined

In this section, the term covered organization means any of the following:

(1)

Any corporation which is subject to section 316(a).

(2)

Any labor organization (as defined in section 316).

(3)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(4)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

(d)

Campaign-Related Activity Defined

In this section, the term campaign-related activity has the meaning given such term in section 325.

.

214.

Modification of rules relating to disclaimer statements required for certain communications

(a)

Applying requirements to all independent expenditure communications

Section 318(a) of the Federal Election Campaign Act of 1971 (2 U.S.C. 441d(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 an independent expenditure consisting of a public communication.

(b)

Stand by your ad requirements

(1)

Maintenance of existing requirements for communications by political parties and other political committees

Section 318(d)(2) of such Act (2 U.S.C. 441d(d)(2)) is amended—

(A)

in the heading, by striking others and inserting political committees;

(B)

by striking subsection (a) and inserting subsection (a) which is paid for by a political committee (including a political committee of a political party), other than a political committee which makes only electioneering communications or independent expenditures consisting of public communications,; and

(C)

by striking or other person each place it appears.

(2)

Special disclaimer requirements for certain communications

Section 318 of such Act (2 U.S.C. 441d) is amended by adding at the end the following new subsection:

(e)

Communications by others

(1)

In general

Any communication described in paragraph (3) of subsection (a) which is transmitted through radio or television (other than a communication to which subsection (d)(2) applies because the communication is paid for by a political committee, including a political committee of a political party, other than a political committee which makes only electioneering communications or independent expenditures consisting of public communications) shall include, in addition to the requirements of that paragraph, the following:

(A)

The individual disclosure statement described in paragraph (2) (if the person paying for the communication is an individual) or the organizational disclosure statement described in paragraph (3) (if the person paying for the communication is not an individual).

(B)

If the communication is an electioneering communication or an independent expenditure consisting of a public communication and is paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, the significant funder disclosure statement described in paragraph (4) (if applicable), unless, on the basis of criteria established in regulations promulgated by the Commission, the communication is of such short duration that including the statement in the communication would constitute a hardship to the person paying for the communication by requiring a disproportionate amount of the communication’s content to consist of the statement.

(C)

If the communication is an electioneering communication or an independent expenditure consisting of a public communication and is paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, the Top Five Funders list described in paragraph (5) (if applicable), unless, on the basis of criteria established in regulations promulgated 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 communication’s content to consist of the Top Five Funders list.

(2)

Individual disclosure statement described

The individual disclosure statement described in this paragraph is the following: I am _______, and I approve this message., with the blank filled in with the name of the applicable individual.

(3)

Organizational disclosure statement described

The organizational disclosure statement described in this paragraph is the following: I am _______, the _______ of _______, and _______ approves this message., with—

(A)

the first blank to be filled in with the name of the applicable individual;

(B)

the second blank to be filled in with the title of the applicable individual; and

(C)

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

(4)

Significant funder disclosure statement described

(A)

Statement if significant funder is an individual

If the significant funder of a communication paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325 is an individual, the significant funder disclosure statement described in this paragraph is the following: I am _______. I helped to pay for this message, and I approve it., with the blank filled in with the name of the applicable individual.

(B)

Statement if significant funder is not an individual

If the significant funder of a communication paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325 is not an individual, the significant funder disclosure statement described in this paragraph is the following: I am _______, the _______ of _______. _______ helped to pay for this message, and _______ approves it., 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, fourth, and fifth blank each to be filled in with the name of the significant funder of the communication.

(C)

Significant funder defined

(i)

Independent expenditures

For purposes of this paragraph, the significant funder with respect to an independent expenditure consisting of a public communication paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325 shall be determined as follows:

(I)

If any report filed by any organization with respect to the independent expenditure under section 304 includes information on any person who made a payment to the organization in an amount equal to or exceeding $100,000 which was designated by the person to be used for campaign-related activity consisting of that specific independent expenditure (as required to be included in the report under section 304(g)(5)(A)(i)), the person who is identified among all such reports as making the largest such payment.

(II)

If any report filed by any organization with respect to the independent expenditure under section 304 includes information on any person who made a payment to the organization in an amount equal to or exceeding $100,000 which was designated by the person to be used for campaign-related activity with respect to the same election or in support of the same candidate (as required to be included in the report under section 304(g)(5)(A)(i)) but subclause (I) does not apply, the person who is identified among all such reports as making the largest such payment.

(III)

If any report filed by any organization with respect to the independent expenditure under section 304 includes information on any person who made a payment to the organization which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity (as required to be included in the report under section 304(g)(5)(A)(i)) but subclause (I) or subclause (II) does not apply, the person who is identified among all such reports as making the largest such payment.

(IV)

If none of the reports filed by any organization with respect to the independent expenditure under section 304 includes information on any person (other than the organization) who made a payment to the organization which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity, but any of such reports includes information on any person who made an unrestricted donor payment to the organization (as required to be included in the report under section 304(g)(5)(A)(ii)), the person who is identified among all such reports as making the largest such unrestricted donor payment.

(ii)

Electioneering communications

For purposes of this paragraph, the significant funder with respect to an electioneering communication paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, shall be determined as follows:

(I)

If any report filed by any organization with respect to the electioneering communication under section 304 includes information on any person who made a payment to the organization in an amount equal to or exceeding $100,000 which was designated by the person to be used for campaign-related activity consisting of that specific electioneering communication (as required to be included in the report under section 304(f)(6)(A)(i)), the person who is identified among all such reports as making the largest such payment.

(II)

If any report filed by any organization with respect to the electioneering communication under section 304 includes information on any person who made a payment to the organization in an amount equal to or exceeding $100,000 which was designated by the person to be used for campaign-related activity with respect to the same election or in support of the same candidate (as required to be included in the report under section 304(f)(6)(A)(i)) but subclause (I) does not apply, the person who is identified among all such reports as making the largest such payment.

(III)

If any report filed by any organization with respect to the electioneering communication under section 304 includes information on any person who made a payment to the organization which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity (as required to be included in the report under section 304(f)(6)(A)(i)) but subclause (I) or subclause (II) does not apply, the person who is identified among all such reports as making the largest such payment.

(IV)

If none of the reports filed by any organization with respect to the electioneering communication under section 304 includes information on any person who made a payment to the organization which was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be used for campaign-related activity, but any of such reports includes information on any person who made an unrestricted donor payment to the organization (as required to be included in the report under section 304(f)(6)(A)(ii)), the person who is identified among all such reports as making the largest such unrestricted donor payment.

(5)

Top 5 Funders list described

With respect to a communication paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, the Top 5 Funders list described in this paragraph is—

(A)

in the case of a disbursement for an independent expenditure consisting of a public communication, a list of the 5 persons (or, in the case of a communication transmitted through radio, the 2 persons) who provided the largest payments of any type which are required under section 304(g)(5)(A) to be included in the reports filed by any organization with respect to that independent expenditure under section 304, together with the amount of the payments each such person provided; or

(B)

in the case of a disbursement for an electioneering communication, a list of the 5 persons (or, in the case of a communication transmitted through radio, the 2 persons) who provided the largest payments of any type which are required under section 304(f)(6)(A) to be included in the reports filed by any organization with respect to that electioneering communication under section 304, together with the amount of the payments each such person provided.

(6)

Method of conveyance of statement

(A)

Communications transmitted through radio

In the case of a communication to which this subsection applies which is transmitted through radio, the disclosure statements required under paragraph (1) shall be made by audio by the applicable individual in a clearly spoken manner.

(B)

Communications transmitted through television

In the case of a communication to which this subsection applies which is transmitted through television, the information required under paragraph (1)—

(i)

shall appear in writing at the end of the communication in a clearly readable 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)

except in the case of a Top 5 Funders list described in paragraph (5), 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.

(7)

Applicable individual defined

In this subsection, the term applicable individual means, with respect to a communication to which this paragraph applies—

(A)

if the communication is paid for by an individual or if the significant funder of the communication under paragraph (4) is an individual, the individual involved;

(B)

if the communication is paid for by a corporation or if the significant funder of the communication under paragraph (4) is 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 or if the significant funder of the communication under paragraph (4) is a labor organization, the highest ranking officer of the labor organization; or

(D)

if the communication is paid for by any other person or if the significant funder of the communication under paragraph (4) is any other person, the highest ranking official of such person.

(8)

Covered organization defined

In this subsection, the term covered organization means any of the following:

(A)

Any corporation which is subject to section 316(a).

(B)

Any labor organization (as defined in section 316).

(C)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(D)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

(9)

Other definitions

In this subsection, the terms campaign-related activity and unrestricted donor payment have the meaning given such terms in section 325.

.

(3)

Application to certain mass mailings

Section 318(a)(3) of such Act (2 U.S.C. 441d(a)(3)) is amended to read as follows:

(3)

if not authorized by a candidate, an authorized political committee of a candidate, or its agents, shall clearly state—

(A)

the name and permanent street address, telephone number, or World Wide Web address of the person who paid for the communication;

(B)

if the communication is an independent expenditure consisting of a mass mailing (as defined in section 301(23)) which is paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, the name and permanent street address, telephone number, or World Wide Web address of—

(i)

the significant funder of the communication, if any (as determined in accordance with subsection (e)(4)(C)(i)); and

(ii)

each person who would be included in the Top 5 Funders list which would be submitted with respect to the communication if the communication were transmitted through television, if any (as determined in accordance with subsection (e)(5)); and

(C)

that the communication is not authorized by any candidate or candidate’s committee.

.

(4)

Application to political robocalls

Section 318 of such Act (2 U.S.C. 441d), as amended by paragraph (2), is further amended by adding at the end the following new subsection:

(f)

Special Rules for Political Robocalls

(1)

Requiring communications to include certain disclaimer statements

Any communication consisting of a political robocall which would be subject to the requirements of subsection (e) if the communication were transmitted through radio or television shall include the following:

(A)

The individual disclosure statement described in subsection (e)(2) (if the person paying for the communication is an individual) or the organizational disclosure statement described in subsection (e)(3) (if the person paying for the communication is not an individual).

(B)

If the communication is an electioneering communication or an independent expenditure consisting of a public communication and is paid for in whole or in part with a payment which is treated as a disbursement by a covered organization for campaign-related activity under section 325, the significant funder disclosure statement described in subsection (e)(4) (if applicable).

(2)

Timing of certain statement

The statement required to be included under paragraph (1)(A) shall be made at the beginning of the political robocall.

(3)

Political robocall defined

In this subsection, the term political robocall means any outbound telephone call—

(A)

in which a person is not available to speak with the person answering the call, and the call instead plays a recorded message; and

(B)

which promotes, supports, attacks, or opposes a candidate for election for Federal office.

.

C

Reporting Requirements for Registered Lobbyists

221.

Requiring registered lobbyists to report information on independent expenditures and electioneering communications

(a)

In general

Section 5(d)(1) of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1604(d)(1)) is amended—

(1)

by striking and at the end of subparagraph (F);

(2)

by redesignating subparagraph (G) as subparagraph (I); and

(3)

by inserting after subparagraph (F) the following new subparagraphs:

(G)

the amount of any independent expenditure (as defined in section 301(17) of the Federal Election Campaign Act of 1971 (2 U.S.C. 431(17)) equal to or greater than $1,000 made by such person or organization, and for each such expenditure the name of each candidate being supported or opposed and the amount spent supporting or opposing each such candidate;

(H)

the amount of any electioneering communication (as defined in section 304(f)(3) of such Act (2 U.S.C. 434(f)(3)) equal to or greater than $1,000 made by such person or organization, and for each such communication the name of the candidate referred to in the communication and whether the communication involved was in support of or in opposition to the candidate; and

.

(b)

Effective date

The amendments made by this section shall apply with respect to reports for semiannual periods described in section 5(d)(1) of the Lobbying Disclosure Act of 1995 that begin after the date of the enactment of this Act.

III

Disclosure by Covered Organizations of Information on Campaign-Related Activity

301.

Requiring disclosure by covered organizations of information on campaign-related activity

Title III of the Federal Election Campaign Act of 1971 (2 U.S.C. 431 et seq.), as amended by section 213, is amended by adding at the end the following new section:

327.

Disclosures by Covered Organizations to Shareholders, Members, and Donors of Information on Disbursements for Campaign-Related Activity

(a)

Including information in regular periodic reports

(1)

In general

A covered organization which submits regular, periodic reports to its shareholders, members, or donors on its finances or activities shall include in each such report the information described in paragraph (2) with respect to the disbursements made by the organization for campaign-related activity during the period covered by the report.

(2)

Information described

The information described in this paragraph is, for each disbursement for campaign-related activity—

(A)

the date of the independent expenditure or electioneering communication involved;

(B)

the amount of the independent expenditure or electioneering communication involved;

(C)

the name of the candidate identified in the independent expenditure or electioneering communication involved, the office sought by the candidate, and (if applicable) whether the independent expenditure or electioneering communication involved was in support of or in opposition to the candidate;

(D)

in the case of a transfer of funds to another person, the information required by subparagraphs (A) through (C), as well as the name of the recipient of the funds and the date and amount of the funds transferred;

(E)

the source of such funds; and

(F)

such other information as the Commission determines is appropriate to further the purposes of this subsection.

(b)

Hyperlink to information included in reports filed with commission

(1)

Requiring posting of hyperlink

If a covered organization maintains an Internet site, the organization shall post on such Internet site a hyperlink from its homepage to the location on the Internet site of the Commission which contains the following information:

(A)

The information the organization is required to report under section 304(g)(5)(A) with respect to public independent expenditures.

(B)

The information the organization is required to include in a statement of disbursements for electioneering communications under section 304(f)(6).

(2)

Deadline; duration of posting

The covered organization shall post the hyperlink described in paragraph (1) not later than 24 hours after the Commission posts the information described in such paragraph on the Internet site of the Commission, and shall ensure that the hyperlink remains on the Internet site of the covered organization until the expiration of the 1-year period which begins on the date of the election with respect to which the public independent expenditures or electioneering communications are made.

(c)

Covered Organization Defined

In this section, the term covered organization means any of the following:

(1)

Any corporation which is subject to section 316(a).

(2)

Any labor organization (as defined in section 316).

(3)

Any organization described in paragraph (4), (5), or (6) of section 501(c) of the Internal Revenue Code of 1986 and exempt from tax under section 501(a) of such Code.

(4)

Any political organization under section 527 of the Internal Revenue Code of 1986, other than a political committee under this Act.

.

IV

Other Provisions

401.

Judicial review

(a)

Special rules for actions brought on constitutional grounds

If any action is brought for declaratory or injunctive relief to challenge the constitutionality of any provision of this Act or any amendment made by this Act, the following rules shall apply:

(1)

The action shall be filed in the United States District Court for the District of Columbia, and an appeal from a decision of the District Court may be taken to the Court of Appeals for the District of Columbia Circuit.

(2)

A copy of the complaint shall be delivered promptly to the Clerk of the House of Representatives and the Secretary of the Senate.

(3)

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 Circuit, and the Supreme Court of the United States to advance on the docket and to expedite to the greatest possible extent the disposition of the action and appeal.

(b)

Intervention by members of congress

In any action in which the constitutionality of any provision of this Act or any amendment made by this Act is raised, 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 or amendment. To avoid duplication of efforts and reduce the burdens placed on the parties to the action, the court in any such action may make such orders as it considers necessary, including orders to require intervenors taking similar positions to file joint papers or to be represented by a single attorney at oral argument.

(c)

Challenge by Members of Congress

Any Member of the House of Representatives (including a Delegate or Resident Commissioner to the Congress) or Senate may bring an action, subject to the special rules described in subsection (a), for declaratory or injunctive relief to challenge the constitutionality of any provision of this Act or any amendment made by this Act.

402.

Severability

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

403.

Effective date

Except as otherwise provided, this Act and the amendments made by this Act shall take effect upon the expiration of the 30-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.

May 25, 2010

Reported from the Committee on House Administration with an amendment

May 25, 2010

Committee on the Judiciary discharged; committed to the Committee of the Whole House on the State of the Union and ordered to be printed