Campaign Finance Reform Bills in the 105th Congress: Comparison of H.R. 3581 (Thomas), H.R. 3526 (Shays-Meehan), and Current Law

98-364 GOV April 13, 1998 CRS Report for Congress Received through the CRS Web Campaign Finance Reform Bills in the 105th Congress: Comparison of H.R. 3581 (Thomas), H.R. 3526 (Shays-Meehan), and Current Law Joseph E. Cantor Specialist in American National Government Government Division Summary On March 30, 1998, the House considered four campaign reform bills under a suspension of rules, focusing on the comprehensive H.R. 3581, offered that day for the Republican leadership by Mr. Thomas; it failed passage on a 74-337 vote. (The bill was similar to H.R. 3485, also by Mr. Thomas, reported by the House Oversight Committee March 18.1) The bill generating the most publicity in the 105th Congress has been S. 25 (McCain-Feingold),2 introduced on March 19 as H.R. 3526 by Messrs. Shays and Meehan. This report summarizes and compares H.R. 3581, H.R. 3526, and current law. Table 1. Comparison of H.R. 3581, H.R. 3526, and Current Law Current law No provision 1 H.R. 3581 (Thomas) SOURCES OF FUNDS PACs Protects confidentiality of small donors or decliners to union or corporate PAC solicitations H.R. 3526 (Shays-Meehan) No provision H.Rept. 105-457, Pt. 1. 2 The McCain-Feingold legislation has been revised twice in the 105th Congress. The first revision (September 29, 1997) was the subject of three failed cloture votes in the fall of 1997, on October 7, 8, and 9. The second revision (February 1998) was in the form of a floor amendment (to S. 1663), as modified by the Snowe-Jeffords amendment. (A cloture vote on this version failed in the Senate February 26, 1998.) The Shays-Meehan bill is based on the current version of S. 25, considered by the Senate in 1997, not February’s modified floor amendment. Congressional Research Service ˜ The Library of Congress CRS-2 Current law H.R. 3581 (Thomas) H.R. 3526 (Shays-Meehan) Individuals To candidates: $1,000 per election To state & local parties: $5,000 per year To national party: $20,000 per year Aggregate annual limit: $25,000 Limits not inflation-indexed To candidates: $5,000 per election Limits not inflation-indexed No limits on candidate spending from personal funds $2,000 per election No provision $15,000 per year $10,000 per year $60,000 per year No provision $75,000 Indexes limits to 1999 base Parties $30,000 No provision $15,000 per election Indexes limits to 1999 base Candidates If candidate exceeds individual limit, up to $150,000, in House general election: Lifts party contribution limit for opponent, up to amount above individual limit If candidate exceeds $150,000 in House general election: Lifts party & individual contribution limits (incl. aggregate annual limit) & raises PAC limit by 10 times for all candidates, up to amount over $150,000 If candidate exceeds $150,000 in House primary election: Lifts individual contribution limit (not incl. aggregate annual limit) & raises PAC limit by 10 times for all candidates, up to amount over $150,000 No provision No provision No provision Bans party coordinated expenditures for House general election candidates who exceed $50,000 vol. limit in personal/ family funds; fines candidates who pledge to abide and exceed Law bans personal use of Codifies regulations on campaign funds, as defined permissible use of campaign in FEC regulations funds INDEPENDENT EXPENDITURES Prohibits cooperation and No provision Tightens definition of what coordination of independent constitutes coordination and expenditures with candidates cooperation Requires filing within 24 Requires FEC receipt of Augments disclosure hours of $1000+ in last 20 filing within 24 hours of requirements of large days of election being made amounts close to election CRS-3 Current law Based on 1996 Colorado ruling, parties may make independent expenditures for candidates (no limit) No limits on national party receipt of soft money State parties must follow allocation formulae in FEC regulations for determining appropriate share of hard & soft money for mixed (federal-state-local) activities No provision Disclosure by national parties (1991 FEC regs.) Contributions to party building funds are exempt from contribution definition No provision No provision H.R. 3581 (Thomas) No provision SOFT MONEY Party soft money Bans national parties from soliciting, receiving, directing, transferring, or spending soft money - Bans use of soft money by state parties on mixed activities, aimed at influencing federal and nonfederal elections (e.g., voter registration, get-out-the-vote drives, and general political advertising) - Bans transfers of nonfederally-permissible funds between state parties No provision No provision No provision Candidate soft money raising Bans federal candidates & officials raising: soft money for federal election; money from sources beyond federal restrictions in non-federal races; & soft money for messages that identify federal candidates; exempts attendance at state party fundraisers in home state Denies public funding to presidential candidates who raise soft money H.R. 3526 (Shays-Meehan) Bans parties from making both coordinated & independent expenditures for general election candidate Bans national parties from soliciting, receiving, directing, transferring, or spending soft money - Bans state/local party soft money spending for federal election activity: registration drives in last 120 days of federal election; voter ID, get-out-the-vote drives, & generic activity if federal candidate is on ballot; & messages that refer to federal candidate with intent of election influence - Allows soft money on solely non-federal activities No soft money to raise funds Codifies & increases disclosure requirements Removes building fund exemption for national parties Prohibits federal candidates & officials from raising soft money for federal election activity (see above); exempts attendance at state party fundraisers No provision CRS-4 Current law Under Beck and other court rulings, dues-paying nonunion members have right to disallow political use of their funds No provision No provision No union or corporate disclosure for exempt activities, except internal communications above $2,000 per election No provision Based on court rulings, only spending for communications that use express advocacy language (e.g., vote for, defeat) are subject to disclosure rules, source limits & prohibitions of FECA H.R. 3581 (Thomas) Non-party soft money Requires pre-authorization for unions’ political use of dues, fees, or payments from members or non-members Requires pre-authorization from corp. & national bank employees & stockholders for political use of dues, fees, or payments as condition of employment Corporate stockholders may withhold share of expected political spending (per annual notice), in proportion to stocks owned No provision Tax-exempt activity No provision ISSUE ADVOCACY Requires FEC disclosure of spending and sources of funds for communications that identify federal candidates or parties within 90 days of election, over $250 threshold H.R. 3526 (Shays-Meehan) Requires unions to give adequate notice to duespaying non-members of rights to disallow political use of funds No provision No provision Requires disclosure of exempt activities (incl. internal communications referring to fed. candidate only), over $50,000 per year Bans party raising money or giving to tax-exempt groups - Defines as communication for or against candidate by: explicit language that in context can have no other reasonable meaning; paid broadcast citing a candidate within 60 days of election; or unambiguous advocacy, taken as whole with limited reference to external events - Voter guide exemption Expenditure defined in No provision Amends definition to incl. FECA as money spent to payment for message with influence a federal election express advocacy, or that refers to clearly identified candidate, is coordinated, & seeks fed. election influence FOREIGN NATIONAL MONEY Bans contributions and - Ends green card exemption Bans direct or indirect fundraising from foreign - Bans foreign national foreign national nationals in connection with independent expenditures or contributions, including soft U.S. elections; exempts soft money donations money, in connection with permanent resident aliens - Doubles penalties for any election (leaves green (with green cards) violations card exemption in law) CRS-5 Current law H.R. 3581 (Thomas) H.R. 3526 (Shays-Meehan) FEDERAL ELECTION COMMISSION Disclosure Optional electronic filing Requires electronic filing by Requires electronic filing by all committees above all committees over FEC-set $50,000 per year level, with 24 hour Internet posting No provision Candidates may disclose all No provision activity in 24 hours in last 90 days; FEC must promptly post such reports on Internet Candidates must disclose in Candidates must make such No provision 48 hours $1000+ notice within 24 hours contributions in last 20 days of election Candidate disclosure on Candidate disclosure on No provision calendar year basis election cycle basis No provision Requires reports on No provision payments of $500+ by secondary payees Law requires post-election Requires aggregate totals No provision reports through election on reports No provision Requires disclosure of push No provision polls within 90 days of election if results not public Contributions of $200+ must Requires candidate reports to - Bans candidate deposit of incl. name, address, show cumulative amounts $200+ contributions without occupation, & employer; received from itemized required ID best efforts required to contributors - Lowers itemization obtain information threshold to $50 for contributions Enforcement FEC may audit only if it has No provision Allows random audits of reason to believe a violation campaigns within 12 months occurred after election Ambiguities in law may be - Allows written responses to No provision clarified through FEC written requests where law is advisory opinions, issued unambiguous with majority support of - Requires FEC to publish commissioners and index responses - Gives safe harbor protection if acting in good faith on response FEC required to notify Enhances notice to assert No provision object of a complaint that object of complaint has not been found guilty FEC may initiate Changes FEC criterion to Changes FEC criterion to enforcement action with “reason to investigate” “reason to investigate” “reason to believe” a standard standard violation may have occurred CRS-6 Current law H.R. 3581 (Thomas) Penalties: maximums are prescribed in election law Indexes penalties for inflation Law specifies timetable for enforcement actions FEC may refer suspected violations to Justice only if probable cause to believe a violation has occurred No provision No provision Bans solicitation of campaign funds, as defined, from federal govt. buildings No provision Imposes penalties on publicly-funded presidential candidates who evade voluntary spending limits and, in general election, raise private funds Bans cash contributions over $100 Bans House franked mass mailings 90 days from election Requires disclaimers on broadcast and print ads No provision No provision MISCELLANEOUS Barriers to vote fraud: - Pilot programs on voter eligibility confirmation - Requires citizenship & naturalization information on registration forms (unless waived by states) - Allows address checks on recent non-voters No provision Push poll sponsor must identify self to respondents Increases fines on presidential candidates seeking to evade spending limits by raising non-public funds H.R. 3526 (Shays-Meehan) - Increases knowing & willful violation penalties - Automatic late filing penalties - Allows equitable remedies in conciliation agreements Expedites FEC enforcement procedures late in election Allows FEC referrals at any time No provision Includes raising soft money in ban on solicitation from government buildings No provision No provision Bans receipt of such contributions No provision No provision No provision Enhances disclaimer requirements Bans false representation to raise funds Bans non-candidate comm. use of candidate names Bans donations by those 17 years & younger No provision No provision No provision No provision No provision Bans franked mass mailings in Member’s election year