Campaign Finance Bills in the 107th Congress: Comparison of H.R. 380 (Shays-Meehan) with S. 27 (McCain-Feingold)

Campaign Finance Bills in the 107th Congress: Comparison of H.R. 380 (Shays-Meehan) with S. 27 (McCain-Feingold)

Order Code RS20820
February 16, 2001
CRS Report for Congress
Received through the CRS Web
Campaign Finance Bills in the 107th Congress:
Comparison of H.R. 380 (Shays-Meehan) with
S. 27 (McCain-Feingold)
Joseph E. Cantor
Specialist in American National Government
Government and Finance Division
Summary
As in the last two Congresses, campaign finance reform will be a major issue in the
107th Congress, with attention again centered on the Senate McCain-Feingold and House
Shays-Meehan bills. S. 27 (Bipartisan Campaign Reform Act of 2001), introduced on
January 22, 2001, will be considered by the Senate in March 2001; H.R. 380 (Bipartisan
Campaign Finance Reform Act of 2001) was introduced January 31. Both bills ban the
raising of soft money by national parties and the spending of it by state and local parties
on federal election-related activities (as defined). But on the other key provision–issue
advocacy–they differ notably. H.R. 380 offers a broad new definition of express
advocacy, subjecting activity meeting that standard to all aspects of federal election law
regulation. S. 27 classifies some messages as electioneering communications, requiring
their disclosure and banning their funding by unions or for-profit corporations. This
report summarizes and compares these two measures, according to various categories.1
H.R. 380 (Shays-Meehan) & S. 27 (McCain-Feingold) Bills Compared
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
Individual Contribution Limits (Hard Money)
To state parties: raises (from $5,000) to $10,000 per year
Annual aggregate limit: raises (from $25,000) to $30,000 (Sec. 102)
1 Section numbers are noted with summaries, referring to all preceding information in that column,
until the prior reference; in joint entries, the House reference is first (if not the same).
Congressional Research Service ˜ The Library of Congress

CRS-2
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
Candidate Role (Hard Money)
Specifies permissible uses for and bans personal use of campaign funds (Sec. 502; 301)
Bans party coordinated expenditures for
No provision
House/Senate cands. not limiting personal/
family money to $50,000 (Sec. 401/402)
Independent Expenditures (Hard Money)
Defines as expenditure for communication
Defines as expenditure expressly advocating
that is express advocacy and that is not a
election/defeat of a clearly identified cand.;
coordinated activity or provided in
not a coordinated activity with
coordination with a candidate/agent/person
candidate/agent/anyone in coord. activity
coordinating with candidate (Sec. 201)
with candidate/agent (Sec. 211)
Requires 48-hour notice of expenditures of $10,000 or more, up to 20 days before election
(and 24-hour notice of expenditures over $1,000 in last 20 days, as now) (Sec. 204; 212)
Bans party independent AND coordinated expenditures (both) for candidate (Sec. 205; 213)
Bans conciliation agreements if probable
No provision
cause found of knowing/willful violation of
indep. expenditure disclosure (Sec. 203)
Coordinated Activity (Hard or Soft Money)
Amends “contribution” to incl. coordinated activity: anything of value provided in conn.
with fed. candidate’s election by anyone who coordinated with that candidate or agent in
connection with election in that election cycle, whether or not express advocacy
Coordinated activity includes payments:
(1) in cooperation, consultation, or concert with, at request or suggestion of, or pursuant to
an understanding with, a candidate (or party or agent acting on behalf);
(2) for production, dissemination, or republication of material prepared by candidate or
agent, except for materials republished from candidate Web site at cost of under $1,000;
(3) by spender who has been employee/fundraiser/ agent of cand. in executive/policy role, in
that election cycle or conferred with candidate/agent/coordinating party about campaign
strategy/tactics (ads, message, resource allocation, fundraising, campaign operations); or
(4) by spender who has used professional services of anyone who in that election cycle has
provided such services to candidate, directly or via party, incl. polling, media, fundraising,
campaign research, political advice, or direct mail (not mailhouse services) (Sec. 206; 214)
Declares any party expenditure for communication referring to clearly identified cand. in
connection with a fed. election, regardless of whether express advocacy, to have been made
in coordination with party’s cand., unless party certifies no coordination (Sec. 205; 214)
Deems coordinated activity as contribution to or expenditure by candidate (Sec. 206; 214)
Party Soft Money
Prohibits national party committees from soliciting, receiving, directing, transferring, or
spending soft money, incl. entities they directly or indirectly establish, finance, maintain, or
control and an agent acting on behalf thereof
Bans soft money spending on federal election activity by state/local party committees, incl.
entities they establish/finance/maintain/control and their agents, or controlled by/acting for
local candidates/officials (state/local candidate committees may raise/spend funds under state
law, if not for fed. election activity referring to clearly identified federal candidate)

CRS-3
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
Defines federal election activity to include:
(1) voter registration drives in last 120 days of a federal election;
(2) voter ID, get-out-the-vote drives, and generic activity in connection with an election in
which a federal candidate is on ballot;
(3) public communications that refer to clearly identified fed. candidate and promote,
support, attack, oppose a cand. (whether or not expressly advocating vote for/against); and
(4) state/local party employee salary if 25%+ of time on activity conn. with fed. election
Public communications are those by broadcast, cable, satellite, newspaper, magazine,
outdoor ads, mass mailing (500+ same/substantially similar pieces sent within 30 days of
each other), or phone bank (500+ same/substantially similar calls within 30 days apart)
Allows state parties to spend money on exclusively non-federal election activities
Bans party committee soft money to raise funds for use on federal election activity
Prohibits party committees/agents from raising money for, or giving to, 501(c)s or 527s
Bans fed. candidates, officeholders, agents, or entities they establish, maintain, finance, or
control from raising soft money connected with fed. election (incl. federal election activity)
or money from sources beyond fed. limits/prohibitions in non-fed. elections (Sec. 101)
• Codifies FEC regulations requiring national party soft money disclosure
• Requires state/local party disclosure of federal election activity (Sec. 103)
Ends building fund exemption (Sec. 101)
Non-Party Soft Money
Requires unions to give reasonable notice to dues-paying non-members of rights to deny
political use of funds and set up/implement objection procedures (Sec. 501; 304)
Requires disclosure of all union/corporate
No provision
exempt activity (but only internal
communications re: federal candidates), once
over $50,000 (Sec. 306)
Issue Advocacy
Defines “express advocacy” as advocating
Defines electioneering communication as a
election/defeat of cand. by: (1) explicit
broadcast, cable, or satellite ad referring to a
phrases, or words/slogans that in context
clearly identified federal candidate, made
have no reasonable meaning but election
within 60 days of a general election or 30
advocacy; (2) referring to cand. in paid
days of a primary, to audience that includes
radio/TV ad within 60 days of election; or
voters in that election
(3) expressing unmistakable, unambiguous
election advocacy, when taken as a whole,
with limited reference to external events
(Requires full disclosure of newly defined
Requires disclosure of electioneering
express advocacy under federal election law)
communications by spender once above
$10,000 total on such spending in a year

CRS-4
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
(Federal election law’s disclosure rules
Reports to include: spender ID, custodian of
would apply)
books, and any controlling entity; principal
place of business; ID of disbursements over
$200; ID of donors of $1,000+ (to separate
segregated fund or to organization itself);
and election/candidate cited (Sec. 201)
(No union or corporate funding are permitted
Bans funding of electioneering messages
under federal election law)
with funds from unions or corporations, but
exempts funding from 501(c)(4)s and 527s
if funding is only from individuals (Sec. 203)
Exempts printed/Internet voter guides, if: (1)
No provision
taken as whole, express no unambiguous
cand. support (but may agree/disagree with
cand. views); (2) are not coordinated with
candidate/party (but allow questions/
answers for guides); and (3) have no words/
phrases that in context have no reasonable
meaning but election advocacy (Sec. 201)
Excludes background music (not lyrics) from
No provision
express advocacy determination (Sec. 202)
Amends “expenditure” to incl. payment for
Treats electioneering communication that is
messages referring to clearly identified
coordinated with candidate, agent, or party
candidates, to influence federal elections
as contribution to/expenditure by candidate
(whether or not express advocacy) (Sec.
(Sec. 202)
201)
Prohibits publicly-funded pres. candidates
No provision
from coordinating soft money issue advocacy
(defined) with parties (Sec. 1301)
FEC Enforcement & Disclosure
Allows random audits of campaigns within
No provision
12 months after election (Sec. 302)
Raises civil penalties; adds automatic late
No provision
filing penalties (2000 schedule taken into
account); provides for equitable remedies in
conciliation agreements (Sec. 505)
Expedites enforcement where clear/
No provision
convincing evidence that violation has
occurred, is occurring, or is about to occur
Allows FEC to refer suspected violations to
No provision
Attorney General at any time (Sec. 508)
Changes standard to begin enforcement to
No provision
“reason to investigate” (Sec. 509)
Raises criminal penalty on knowing/willful
No provision
violation of contribution/expenditure limits
to mandatory 1-10 yrs. prison (Sec. 1201)

CRS-5
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
Allows Justice Dept. to file criminal actions
No provision
at any time, without FEC referral (Sec.
1201)
Allows candidates to institute civil actions
No provision
for suspected violations in last 90 days of
election; expedited court review (Sec. 512)
Sets up FEC escrow fund for $500+
No provision
donations a committee plans to return,
pending investigation (Sec. 514)
Bans candidate deposit of $200+ donations
No provision
without required itemized info. (Sec. 301)
Lowers threshold to $50 for itemizing
No provision
contributions (only name/address) (Sec. 303)
Foreign Money
Bans direct/indirect contributions from foreign nationals (incl. soft money), their receipt or
solicitation, or any promise to make such donations, in conn. with any U.S. election or to a
national party committee (but retains permanent resident alien exemption) (Sec. 506; 303)
Clarifies that ban does not apply to U.S.
No provision
nationals (Sec. 517)
Ensures equal rights to give money in fed.
No provision
elections, incl. via sponsored PAC (Sec.
510)
Denies willful blindness as defense against
No provision
violation, if recipient should have known
money was from foreign national (Sec. 506)
Mandates penalty for violation: up to 10 yrs.
No provision
jail, $1 million fine, or both (Sec. 511)
Requires House Ethics Comm. recommend-
No provision
ation (incl. possible expulsion) re: Member
convicted of violation (Sec. 1501)
Creates FEC clearinghouse for info. on
No provision
political/lobbying activity by foreign
principals/agents (Sec. 515)
Advertising
Amends disclaimer requirements to make
No provision
them more prominent and visible (Sec. 307)
Study Commission
Sets up temp. commission to propose fed.
No provision
campaign finance reforms, to be considered
under fast-track rules (Sec. 601-608)

CRS-6
H.R. 380 (Shays-Meehan)
S. 27 (McCain-Feingold)
Miscellaneous
Bans solicitation or receipt of contributions, incl. soft money, by federal officials and from
anyone, in any federal government building used for official duties (Sec. 504; 302)
Bans false representation to raise funds (Sec.
No provision
305)
Requires cand. name in authorized comm.
No provision
name; bans non-cand. comm. use (Sec. 304)
Bans franked mass mail within 180 (90)
No provision
days of general (primary) elec. (Sec. 503)
Bans contributions by minors (Sec. 507)
No provision
Requires up to $1 million fine, 3 yrs. jail, or
No provision
both on public fund cands. trying to evade
spending limits by private funding (Sec. 513)
Requires public-funded candidates to certify
No provision
no soft money raising for election (Sec. 516)
Bans White House meals/accommodations
No provision
for political fundraising use (Sec. 701)
Expresses sense of Congress that
No provision
“controlling legal authority” bans federal
property to raise campaign funds (Sec. 801)
Bans acceptance/solicitation of anything of
No provision
value to get access to Air Force or Marine 1
or 2, White House, or V.P. home (Sec. 901)
Requires natl. party to reimburse Treasury at
No provision
fair market charter rate for use of Air Force
1 to raise money for party (Sec. 1001)
Requires fed. candidates (not in fed. office)
No provision
using federal govt. vehicles for campaigns to
reimburse Treasury at full cost (Sec. 1002)
Requires Internet disclosure of non-govt. Air
No provision
Force 1 or 2 passengers (Sec. 1401)
Bans “walking around money” (Sec. 1101)
No provision
If any provision of Act or statute is held unconstitutional, the remainder of Act and statute
would be unaffected (i.e., severability clause) (Sec. 1601; 401)