Redline of 2010 and 2012 DISCLOSE Act

8/3/2019 Redline of 2010 and 2012 DISCLOSE Act

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Calendar No. 476

S. 3628

.....................................................................(Original Signature of Member)

112TH CONGRESS

2D SESSIONH. R. llTo amend the Federal Election Campaign Act of 1971 to prohibit foreign influence inFederal elections, to prohibit government contractors from making expenditures

with respect to such elections, and to establish provide for additionaldisclosure requirements with respect to spending in such electionsfor corporations,labor organizations, andother entities, and for other purposes.

IN THE SENATEHOUSE OF THE UNITED STATESREPRESENTATIVESJULY 21,2010

Mr.SCHUMER VAN HOLLEN introduced the following bill; which was readreferred to the first time

JULY 22,2010

Read the second time and placed on the calendar

Committee on llllllllllllll

A BILLTo amend the Federal Election Campaign Act of 1971 to prohibit foreigninfluence in Federal elections, to prohibit government contractors from makingexpenditures with respect to such elections, and to establishprovide for additional disclosure requirements with respect to spending insuch electionsfor corporations,labor organizations, and other entities, and

for other purposes. Be it enacted by the Senate and House ofRepresentatives of the United States of America in Congress assembled,SECTION 1. SHORT TITLE. This Act may be cited as the Disclosure ofInformation on Spending on Campaigns Leads to Open and SecureElections Act of 2012 or the DISCLOSE 2012 Act.

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.


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(a) SHORT TITLE.This Act may be cited as the Democracy isStrengthened by Casting Light on Spending in Elections Act or theDISCLOSE Act.

(b) TABLE OF CONTENTS.The table of contents of this Act is as follows:

SEC. 2. FINDINGS.

(a) GENERAL FINDINGS.Congress finds and declares as follows:

(1) Throughout the history of the United States, the American peoplehave been rightly concerned about the power of special interests to controlour democratic processes. That was true over 100 years ago when Congressfirst enacted legislation intended to restrict corporate funds from being usedin Federal elections, legislation that Congress amended in 1947 to expresslyinclude independent expenditures. The Supreme Court held such legislationto 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 Courts decision in Citizens United v. FederalElection Commission on January 21, 2010, invalidated legislation restrictingthe ability of corporations and labor unions to spend funds from theirgeneral treasury accounts to influence the outcome of elections.

(b) FINDINGS RELATING TO GOVERNMENT CONTRACTORS.Congressfinds and declares as follows:

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

(2) Independent expenditures and electioneering communications thatbenefit particular candidates or elected officials or disfavor their opponentscan lead to apparent and actual ingratiation, access, influence, and quid proquo arrangements. Government contracts should be awarded based on anobjective application of statutory criteria, not based on other forms ofinappropriate or corrupting influence.


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(3) Prohibiting independent expenditures and electioneeringcommunications by persons negotiating for or performing governmentcontracts will prevent government officials involved in or with influenceover the contracting process from influencing the contracting process based,

consciously or otherwise, on this kind of inappropriate or corruptinginfluence.

(4) Prohibiting independent expenditures and electioneeringcommunications by persons negotiating for or performing governmentcontracts will likewise prevent such persons from feeling pressure, whetheractually exerted by government officials or not, to make expenditures and tofund communications in order to maximize their chances of receivingcontracts, or to match similar expenditures and communications made bytheir competitors.

(5) Furthermore, because government contracts often involve largeamounts of public money, it is critical that the public perceive that thegovernment contracts are awarded strictly in accordance with prescribedstatutory standards, and not based on other forms of inappropriate orcorrupting influence. The publics confidence in government is underminedwhen corporations that make significant expenditures during Federalelection campaigns later receive government funds.

(6) Prohibiting independent expenditures and electioneeringcommunications by persons negotiating for or performing governmentcontracts will prevent any appearance that government contracts wereawarded based in whole or in part on such expenditures or communications,or based on the inappropriate or corrupting influence such expenditures andcommunications can create and appear to create.

(7) In these ways, prohibiting independent expenditures andelectioneering communications by persons negotiating for or performinggovernment contracts will protect the actual and perceived integrity of thegovernment contracting process.

(8) Moreover, the risks of waste, fraud and abuse, all resulting ineconomic losses to taxpayers, are significant when would-be publiccontractors or applicants for public funds make expenditures in Federalelection campaigns in order to affect electoral outcomes.


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(c) FINDINGS RELATING TO FOREIGN CORPORATIONS.Congress findsand declares as follows:

(1) The Supreme Courts decision in the Citizens United case hasprovided the means by which United States corporations controlled byforeign entities can freely spend money to influence United States elections.

(2) Foreign corporations commonly own U.S. corporations in whole orin part, and U.S. corporate equity and debt are also held by foreignindividuals, sovereign wealth funds, and even foreign nations at levelswhich permit effective control over those U.S. entities.

(3) As recognized in many areas of the law, foreign ownership interestsand 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 protectAmerican interests and sovereignty from foreign interference and intrusion.

(5) Congress has a clear interest in minimizing foreign intervention, andthe perception of foreign intervention, in United States elections.

(d) FINDINGS RELATING TO COORDINATED EXPENDITURES.Congressfinds and declares as follows:

(1) It has been the consistent view of Congress and the courts thatcoordinated expenditures in campaigns for election are no different innature from contributions.

(2) Existing rules still allow donors to evade contribution limits bymaking campaign expenditures which, while technically qualifying asindependent expenditures under law, are for all relevant purposescoordinated 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 orappearance of corruption to the same degree that direct contributions to acandidate may give rise to the reality or appearance of corruption.Moreover, expenditures which are in fact made in coordination with a


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candidate or political party have the potential to lessen the publics trust andfaith in the rules and the integrity of the electoral process.

(4) The government therefore has a compelling interest in making surethat expenditures that are de facto coordinated with a candidate are treatedas such to prevent corruption, the appearance of corruption, or theperception that some participants are circumventing the laws andregulations 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 isfunding independent expenditures and electioneering communications to

influence Federal elections, and the government has a compelling interest inproviding the public with that information. Effective disclaimers andprompt disclosure of expenditures, and the disclosure of the funding sourcesfor these expenditures, can provide shareholders, voters, and citizens withthe information needed to evaluate the actions by special interests seekinginfluence over the democratic process. Transparency promotesaccountability, increases the fund of information available to the publicconcerning the support given to candidates by special interests, sheds thelight 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 particularlyimportant to address the increase in special interest spending on election-related communications which Congress finds will result from the SupremeCourts decision in the Citizens United case. The current disclosure anddisclaimer requirements were designed for a campaign finance system inwhich such expenditures were subject to prohibitions that no longer apply.

(3) More rigorous disclosure and disclaimer requirements are necessaryto protect against the evasion of those current rules that were not the subjectof the Citizens United case. Organizations that engage in election-relatedcommunications have used a variety of methods to attempt to obscure theirsponsorship of communications from the general public, including multipletransfers of funds between different individuals and organizations. Robust,enhanced disclosure and disclaimer requirements are necessary to ensure


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that the electorate is informed about who is actually paying for particularelection-related communications, and that the shareholders and members oforganizations are aware of their organizations election-related spending.

(4) Various factors, including the frequency of political campaigns thateffectively begin long before election day, have also rendered the existingsystem of disclosure and disclaimer requirements (including the limitedtime periods during which some of those requirements currently apply)inadequate to protect fully the governments compelling interests. Thoseinterests include ensuring that the electorate is fully informed about thesources of election-related spending, and that shareholders, voters andcitizens alike have the information they need to hold corporations andelected officials accountable.

(5) The pervasive nature of campaign advertising means that mostAmericans, even those who might not be otherwise engaged in the politicalprocess, will come into contact with campaign advertising. Moreover, thelengthy nature of most modern campaigns means that many Americans willbe exposed to campaign advertising for an extended period of time prior tothe actual election. Many of these Americans may lack ready access to theinformation provided through the existing disclosure requirements. For thisreason, disclaimers on the campaign advertising itself are particularlyimportant in improving the knowledge of the American people about who is

funding independent expenditures and electioneering communications toinfluence Federal elections.

(6) Effective disclaimers enable the American people to assessadvertisements as they see or hear them, making them aware of the sourcesof funding behind advertisements, and enabling them to use thatinformation to help evaluate the persuasiveness of the advertisements.Effective disclaimers can also alert the electorate to connections betweendifferent advertisements, such as when different advertisements are

supported by the same funding source. It is thus particularly important thatdisclaimers on all advertising be presented in a manner that can be quicklyand easily understood, and is likely to be observed and retained, by thoseseeing or hearing the advertisement.

(7) The current lack of accountability and transparency with respect tospecial interest political spending allows that spending to serve as a private


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benefit for the officials of special interest organizations, to the detriment ofthose organizations and their shareholders and members.

(8) Election-related communications by not-for-profit charitableorganizations raise certain additional, particularized issues. In the past, suchorganizations have sometimes been established in order to permit the actualsponsors of election-related communications to obscure their identities fromvoters and the general public. At the same time, other such organizations arefamiliar, established associations of persons dedicated to a common andtransparent charitable, educational, or recreational purpose. The importanceof enhanced disclosures of the sources of funding of a not-for-profitorganizations election-related communications is diminished where certainconditions are met. If an organization is long-established, the public is morelikely to be familiar with the organization and its purposes, making it lessimportant to require disclosure of the organizations donors in order for thepublic to fairly understand and evaluate its communications. Similarly,national organizations with broad-based membership are likely to be betterknown, making enhanced disclosure of the organizations donors lesscritical. Organizations that have a substantial membership, particularly ageographically dispersed and long-standing membership, are less likely toserve as conduits for a small number of donors who use the organization toexpress their own personal views in the guise of an organizationalcommunication. Organizations that accept only limited funds from

corporations and do not use any corporate funds to subsidize campaign-related activities are less likely to be used to obscure corporate sources ofpolitical communications. In rare cases where all of these characteristicsdescribe a particular non-profit organization, the existing disclosure anddisclaimer requirements will provide sufficient information to enable thepublic to understand who is actually speaking.

(f) FINDINGS RELATING TO CAMPAIGN SPENDING BY LOBBYISTS.Congress finds and declares as follows:

(1) Lobbyists and lobbying organizations, and through them, theirclients, influence the public decision-making process in a variety of ways.

(2) In recent years, scandals involving undue lobbyist influence havelowered public trust in government and jeopardized the willingness ofvoters to take part in democratic governance.


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(3) One way in which lobbyists may unduly influence Federal officialsis through their clients making independent expenditures or electioneeringcommunications targeting elected officials.

(4) Disclosure of such independent expenditures and electioneeringcommunications will allow the public to examine connections between suchspending and official actions, and will therefore limit the ability of lobbyiststo exert an undue influence on elected officials.

SEC. 101. PROHIBITING INDEPENDENT EXPENDITURES AND ELECTIONEERINGCOMMUNICATIONS BY GOVERNMENT CONTRACTORS.

(a) PROHIBITION APPLICABLE TO GOVERNMENT CONTRACTORS.

(1) PROHIBITION.

(A) IN GENERAL.Section 317(a)(1) of the Federal ElectionCampaign Act of 1971 (2 U.S.C. 441c(a)(1)) is amended by strikingpurpose or use; or and inserting the following: purpose or use, tomake any independent expenditure, or to disburse any funds for anelectioneering communication; or.

(B) CONFORMING AMENDMENT.The heading of section 317 ofsuch Act () is amended by striking CONTRIBUTIONS and insertingCONTRIBUTIONS, INDEPENDENT EXPENDITURES, ANDELECTIONEERING COMMUNICATIONS.

(2) THRESHOLD FOR APPLICATION OF BAN.Section 317 of such Act ()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 acontract described in such subsection from making any independent expenditureor disbursing funds for an electioneering communication, such subsection shallapply only if the value of the contract is equal to or greater than $10,000,000..


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(b) APPLICATION TO RECIPIENTS OF ASSISTANCE UNDER TROUBLEDASSET PROGRAM.Section 317(a) of such Act (2 U.S.C. 441c(a)) isamended

(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 ofthe Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5211 et seq.)(relating to the purchase of troubled assets by the Secretary of theTreasury), during the period

(A) beginning on the later of the commencement of thenegotiations or the date of the enactment of the Democracy isStrengthened by Casting Light on Spending in Elections Act; and

(B) ending with the later of the termination of such negotiations orthe repayment of such financial assistance;

directly or indirectly to make any contribution of money or other things ofvalue, or to promise expressly or impliedly to make any such contribution to

any political party, committee, or candidate for public office or to anyperson for any political purpose or use, to make any independentexpenditure, 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 insertingsection 316.

SEC. 102. APPLICATION OF BAN ON CONTRIBUTIONS AND EXPENDITURES BYFOREIGN NATIONALS CAMPAIGN DISBURSEMENT REPORTING. (a) INFORMATIONREQUIRED TO FOREIGN-CONTROLLED DOMESTIC CORPORATIONS.

(a) APPLICATION OF BAN .Section 319(b) of the Federal ElectionCampaign Act of 1971 () is amended


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(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 inparagraph (1) and

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

(i) 5 percent or more of the voting shares, if the foreign

national is a foreign country, a foreign government official, or acorporation principally owned or controlled by a foreign country orforeign government official; or

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

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

of the voting shares;

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

(D) over which one or more foreign nationals described inparagraph (1) or (2) has the power to direct, dictate, or control thedecision-making process of the corporation with respect to its interestsin the United States; or

(E) over which one or more foreign nationals described inparagraph (1) or (2) has the power to direct, dictate, or control thedecision-making process of the corporation with respect to activities inconnection with a Federal, State, or local election, including


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

(ii) the administration of a political committee established ormaintained by the corporation..

(b) CERTIFICATION OF COMPLIANCE.Section 319 of such Act () isamended by adding at the end the following new subsection:

(c) CERTIFICATION OF COMPLIANCE REQUIRED PRIOR TO CARRYINGOUT ACTIVITY.Prior to the making in connection with an election forFederal office of any contribution, donation, expenditure, independentexpenditure, or disbursement for an electioneering communication by a

corporation during a year, the chief executive officer of the corporation (or, ifthe corporation does not have a chief executive officer, the highest rankingofficial of the corporation), shall file a certification with the Commission, underpenalty of perjury, that the corporation is not prohibited from carrying out suchactivity under subsection (b)(3), unless the chief executive officer haspreviously filed such a certification during the year. Nothing in this subsectionshall be construed to apply to any contribution, donation, expenditure,independent expenditure, or disbursement from a separate segregated fundestablished and administered by a corporation under section 316(b)(2)(C)..

(c) NO EFFECT ON CERTAIN ACTIVITIES OF DOMESTICCORPORATIONS.Section 319 of such Act (), as amended by subsection (b), isfurther amended by adding at the end the following new subsection:

(d) NO EFFECT ON CERTAIN ACTIVITIES OF DOMESTICCORPORATIONS.

(1) SEPARATE SEGREGATED FUNDS.Nothing in this section shall beconstrued 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 fundunder section 316(b)(2)(C), so long as none of the amounts in the fund areprovided by any foreign national described in paragraph (1) or (2) ofsubsection (b) and no foreign national described in paragraph (1) or (2) of


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subsection (b) has the power to direct, dictate, or control the establishmentor administration of the fund.

(2) STATE AND LOCAL ELECTIONS.Nothing in this section shall be

construed to prohibit any corporation which is not a foreign nationaldescribed in paragraph (1) of subsection (b) from making a contribution ordonation in connection with a State or local election to the extent permittedunder State or local law, so long as no foreign national described inparagraph (1) or (2) of subsection (b) has the power to direct, dictate, orcontrol such contribution or donation.

(3) OTHER PERMISSIBLE CORPORATE CONTRIBUTIONS ANDEXPENDITURES.Nothing in this section shall be construed to prohibit anycorporation which is not a foreign national described in paragraph (1) ofsubsection (b) from carrying out any activity described in subparagraph (A)or (B) of section 316(b)(2), so long as none of the amounts used to carry outthe activity 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 suchactivity..

(d) NO EFFECT ON OTHER LAWS.Section 319 of such Act (), asamended 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 beconstrued to affect the determination of whether a corporation is treated as aforeign national for purposes of any law other than this Act..

SEC. 103.BE REPORTED. (1) TREATMENT OF PAYMENTS FOR COORDINATEDCOMMUNICATIONSFUNCTIONAL EQUIVALENT OF EXPRESS ADVOCACY ASCONTRIBUTIONS.

(a) IN GENERAL.Section 301(8)(A) of the Federal Election CampaignAct 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


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(3) by adding at the end the following new clause:

(iii) any payment made by any person (other than a candidate, anauthorized committee of a candidate, or a political committee of apolitical party) for a coordinated communication (as determined undersection 324)..

(b) COORDINATED COMMUNICATIONS DESCRIBED.Section 324 ofsuch Act () is amended to read as follows:

SEC. 324. COORDINATED COMMUNICATIONS.

(a) COORDINATED COMMUNICATIONS DEFINED.

(1) IN GENERAL.For purposes of this Act, the term coordinatedcommunication means

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

(B) any communication that republishes, disseminates, ordistributes, in whole or in part, any broadcast or any written, graphic, or

other form of campaign material prepared by a candidate, an authorizedcommittee of a candidate, or their agents.

(2) EXCEPTION.The term coordinated communication does notinclude

(A) a communication appearing in a news story, commentary, oreditorial 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, politicalcommittee, or candidate; or

(B) a communication which constitutes a candidate debate orforum conducted pursuant to the regulations adopted by theCommission to carry out section 304(f)(3)(B)(iii), or which solely


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than President or Vice President, the communication shall be considered tobe publicly distributed or publicly disseminated only if the dissemination ordistribution occurs in the jurisdiction of the office that the candidate isseeking.

(c) NO FINDING OF COORDINATION BASED SOLELY ON SHARING OFINFORMATION REGARDING LEGISLATIVE OR POLICY POSITION.Forpurposes of subsection (a)(1), a covered communication shall not be consideredto be made in cooperation, consultation, or concert with, or at the request orsuggestion of, a candidate, an authorized committee of a candidate, or a politicalcommittee of a political party solely on the grounds that a person or an agentthereof engaged in discussions with to the candidate or committee regarding thatpersons position on a legislative or policy matter (including urging thecandidate or party to adopt that persons position), so long as there is nodiscussion between the person and the candidate or committee regarding thecandidates campaign plans, projects, activities, or needs.

(d) PRESERVATION OF CERTAIN SAFE HARBORS AND FIREWALLS.Nothing in this section may be construed to affect section 109.21(g) or (h) oftitle 11, Code of Federal Regulations, as in effect on the date of the enactmentof the Democracy is Strengthened by Casting Light on Spending in ElectionsAct.

(e) TREATMENT OF COORDINATION WIT H POLITICAL PARTIES FORCOMMUNICATIONS REFERRING TO CANDIDATES.For purposes of thissection, if a communication which refers to any clearly identified candidate orcandidates of a political party or any opponent of such a candidate or candidatesis determined to have been made in cooperation, consultation, or concert with orat the request or suggestion of a political committee of the political party but notin cooperation, consultation, or concert with or at the request or suggestion ofsuch clearly identified candidate or candidates, the communication shall betreated 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 notwith or at the request or suggestion of such clearly identified candidate orcandidates..

(c) EFFECTIVE DAT E.


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(1) IN GENERAL.This section and the amendments made by thissection shall apply with respect to payments made on or after the expirationof 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 coordinatedcommunication under section 324 of the Federal Election Campaign Act of1971 (as amended by subsection (b)) by reason of any action taken by theperson prior to the date of the enactment of this Act. Nothing in theprevious sentence shall be construed to affect any determination under anyother 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 apolitical party.

SEC. 104. TREATMENT OF POLITICAL PARTY COMMUNICATIONS MADE ONBEHALF OF CANDIDATES.

(a) TREATMENT OF PAYMENT FOR PUBLIC COMMUNICATION ASCONTRIBUTION IF MADE UNDER CONTROL OR DIRECTION OF

CANDIDATE.Section 301(8)(A) of the Federal Election Campaign Act of1971 (), 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 forthe direct costs of a public communication (as defined in paragraph(22)) made on behalf of a candidate for Federal office who is affiliatedwith such party, but only if the communication is controlled by, ormade at the direction of, the candidate or an authorized committee ofthe candidate..


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(b) REQUIRING CONTROL OR DIRECTION BY CANDIDATE FORTREATMENT 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 directcosts incurred by a political committee of a political party for a communicationmade in connection with the campaign of a candidate for Federal office shall notbe subject to the limitations contained in paragraphs (2) and (3) unless thecommunication is controlled by, or made at the direction of, the candidate or anauthorized 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 DAT E.This section and the amendments made by thissection shall apply with respect to payments made on or after the expiration ofthe 30-day period which begins on the date of the enactment of this Act, withoutregard to whether or not the Federal Election Commission has promulgatedregulations to carry out such amendments.

SEC. 105. RESTRICTION ON INTERNET COMMUNICATIONS TREATED AS PUBLICCOMMUNICATIONS.

(a) IN GENERAL.Section 301(22) of the Federal Election Campaign Actof 1971 () is amended by adding at the end the following new sentence: Acommunication which is disseminated through the Internet shall not be treatedas a form of general public political advertising under this paragraph unless thecommunication was placed for a fee on another persons Web site..

(b) EFFECTIVE DATE.The amendment made by subsection (a) shall take

effect on the date of the enactment of this Act.

SEC. 201.INDEPENDENT EXPENDITURES.


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(a) REVISION OF DEFINITIONEXPENDITURE.Subparagraph (A) ofsection 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 ordefeat of a clearly identified candidate, or is the functional equivalent ofexpress advocacy because it can be interpreted by a reasonable persononly as advocatingad1vocating the election or defeat of a candidate, takinginto account whether the communication involved mentions a candidacy, apolitical party, or a challenger to a candidate, or takes a positionposi1tionon a candidates character, qualifications, or fitness for office; and.and.(2) EXPANSION OF PERIOD DURING WHICH COMMUNICATIONS ARE TREATED ASELECTION2EERING COMMUNICATIONS.Section 304(f)(3)(A)(i) of such Act (2U.S.C. 434(f)(3)(A)(i)) is amended (A) by redesignating subclause (III) as

subclause (IV); and (B) by striking subclause (II) and inserting the following:

(b) UNIFORM 24-HOUR REPORTING FOR PERSONS MAKINGINDEPENDENT EXPENDITURES EXCEEDING $10,000AT ANY TIME.Section 304(g) of such Act () is amended by striking paragraphs (1) and (2) andinserting the following:

(1) INDEPENDENT EXPENDITURES EXCEEDING THRESHOLDAMOUNT.

(A) INITIAL REPORT.A person (including a political committee) that makesor contracts

(II) in the case of a communication which refers to makeindependent expenditures in a candidate for an aggregate amountequal to or greater office other than the threshold amount described insubparagraph (C) shall electronically file a report describing theexpenditures within 24 hours.

(B) ADDITIONAL REPORTS.After a person files a report undersubparagraph (A), the person shall electronically file an additionalreport within 24 hours after each time the person makes or contracts tomake independent expenditures in an aggregate amount equal to orgreater than the threshold amount with respect to the same election asthat to which the initial report relates.


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(C) THRESHOLD AMOUNT DESCRIBED.In this paragraph, thethreshold amount means

(i) President or Vice President, is made during the period

up to and including the 20th day before the date of anbeginning onJanuary 1 of the calendar year in which a general or runoffelection is held and ending on the date of the general or runoffelection, $10,000; or

(ii) (or in the case of a special election, during the periodafter the 20th day, but more than 24 hours, beforebeginning on thedate of an election, $1,000.

(2) PUBLIC AVAILABILITY.Notwithstanding any other provision of

this section, the Commission shall ensure that the information required to bedisclosed under this subsection is publicly available through theCommission website not later than 24 hours after receipt in a manner that isdownloadable in bulk and machine readable..

(c) EFFECTIVE DAT E.

(1) IN GENERAL.The amendment made by subsection (a) shallapplyon which the announcement with respect to contributions and

expenditures such election is made on or after the expiration of the 30-dayperiod which beginsand ending on the date of the enactment of this Act,without regard to whether or not the Federal Election Commission haspromulgated 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 specialelec1tion); (III) in the case of a commu1nication which refers to acandidate for the office of President or Vice President, is made in anyState dur1ing the period beginning 120 days before the first primary orpreference election or a convention or caucus of a political party whichhas the author2ity to nominate a candidate for the of2fice of Presidentor Vice President isheld in any State and ending on the date of theenactment of this Act.

SEC. 202.general election; and. (3) EFFECTIVE DATE; TRANSITION FORELECTIONEERING COMMUNICATIONS.


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(a) EXPANSION OF PERIOD COVERING GENERAL ELECTION.Section304(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 120days.

(b) EFFECTIVE DATE;TRANSITION FOR COMMUNICATIONS MADE PRIOR TOENACTMENT.The amendment made by subsection (aparagraph (2) shallapply with respect to communications made on or after the date of theenactment of this Act, without regard to whether or not the Federal ElectionCommission has promulgated regulations to carry out such amendmentsJuly 1,2012, except that no communication which is made prior to thesuch date ofthe enactment of this Act shall be treated as an electioneeringcommunication under section 304(f)(3)(A)(i)(II) or (III) of the FederalElection Campaign Act of 1971 (as amended by subsection (aparagraph (2))

unless the communication would be treated as an electioneeringcommunication under such section if the amendment made by subsection(a) did not apply.paragraph (2) did not apply. (b) DISCLOSURE REQUIREMENTSFOR CORPORA1TIONS, LABOR ORGANIZATIONS, AND CERTAIN OTHER ENTITIES.(1) IN GENERAL.Section 324 of the Federal Election Campaign Act of 1971(2 U.S.C. 441k) is amended to read as follows: SEC. 324. DISCLOSURE OFCAMPAIGN-RELATED DISBURSE2MENTS BY COVERED ORGANIZATIONS. (a) DISCLOSURESTATEMENT.

SEC. 203. MANDATORY ELECTRONIC FILING BY PERSONS MAKING

INDEPENDENT EXPENDITURES OR ELECTIONEERING COMMUNICATIONSEXCEEDING $10,000 AT ANY TIME.

Section 304(d)(1) of the Federal Election Campaign Act of 1971 () isamended

(1) by striking or (g); and

(2) by adding at the end the following: Notwithstanding any otherprovision of this section, any person who is required to file a statement

under subsection (f) or subsection (g) shall file the statement in electronicform accessible by computers, in a manner which ensures that theinformation provided is searchable, sortable, and downloadable..

SEC. 211. ADDITIONAL INFORMATION REQUIRED TO BE INCLUDED IN REPORTSON DISBURSEMENTS BY COVERED ORGANIZATIONS.


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(a) INDEPENDENT EXPENDITURE REPORTS.Section 304(g) of theFederal Election Campaign Act of 1971 () is amended by adding at the end thefollowing new paragraph:

(5) DISCLOSURE OF ADDITIONAL INFORMATION BY COVEREDORGANIZATIONS MAKING PAYMENTS FOR PUBLIC INDEPENDENTEXPENDITURES.

(A) ADDITIONAL INFORMATION.If a covered organizationmakes or contracts to make public independent expenditures in anaggregate amount equal to or exceeding $10,000 in a calendar year, thereport filed by the organization under this subsection shall include, inaddition to the information required under paragraph (3), the followinginformation (subject to subparagraph (B)(iv)):

(i) If any person made a donation or payment to the coveredorganization during the covered organization reporting periodwhich was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be usedfor campaign-related activity

(I) subject to subparagraph (C), the identification of eachperson 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 orpayments made by such persons during such period (with theidentification of the person making the largest donation orpayment appearing first); and

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


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(ii) The identification of each person who made unrestricteddonor payments to the organization during the covered organizationreporting period

(I) in an aggregate amount equal to or exceeding $600during such period, if any of the disbursements made by theorganization for any of the public independent expenditureswhich are covered by the report were not made from theorganizations Campaign-Related Activity Account undersection 326; or

(II) in an aggregate amount equal to or exceeding $6,000during such period, if the disbursements made by theorganization for all of the public independent expenditures

which are covered by the report were made exclusively fromthe organizations Campaign-Related Activity Account undersection 326 (but only if the organization has made depositsdescribed in subparagraph (D) of section 326(a)(2) into thatAccount during such period in an aggregate amount equal to orgreater than $10,000),

presented in the order of the aggregate amount of payments madeby 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.Subject to clause (iii), for purposes of therequirement to file reports under this subsection (including therequirement under subparagraph (A) to include additionalinformation in such reports), a covered organization which transfersamounts to another person (other than the covered organization

itself) for the purpose of making a public independent expenditureby 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 ofmaking a public independent expenditure by that person or by anyother person, shall be considered to have made a public independentexpenditure.


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(ii) RULES FOR DEEMING TRANSFERS MADE FOR PURPOSE OFMAKING EXPENDITURES.For purposes of clause (i), indetermining whether a covered organization which transfersamounts to another person shall be deemed to have transferred the

amounts for the purpose of making a public independentexpenditure, the following rules apply:

(I) The covered organization shall be deemed to havetransferred the amounts for the purpose of making a publicindependent expenditure if

(aa) the covered organization designates, requests, orsuggests that the amounts be used for public independentexpenditures and the person to whom the amounts were

transferred agrees to do so;

(bb) the person making the public independentexpenditure or another person acting on that personsbehalf expressly solicited the covered organization for adonation or payment for making or paying for any publicindependent expenditures;

(cc) the covered organization and the person to whom

the amounts were transferred engaged in written or oraldiscussion regarding the person either making, or payingfor, any public independent expenditure, or donating ortransferring the amounts to another person for that purpose;

(dd) the covered organization which transferred thefunds knew or had reason to know that the person to whomthe amounts were transferred intended to make publicindependent expenditures; or

(ee) the covered organization which transferred thefunds or the person to whom the amounts were transferredmade one or more public independent expenditures in anaggregate amount of $50,000 or more during the 2-yearperiod which ends on the date on which the amounts weretransferred.


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(II) The covered organization shall not be deemed to havetransferred the amounts for the purpose of making a publicindependent expenditure if

(aa) the transfer was a commercial transactionoccurring in the ordinary course of business between thecovered organization and the person to whom the amountswere transferred, unless there is affirmative evidence thatthe amounts were transferred for the purpose of making apublic independent expenditure; or

(bb) the covered organization and the person to whomthe amounts were transferred mutually agreed (as providedin section 325(b)(1)) that the person will not use the

amounts for campaign-related activity.

(iii) SPECIAL RULE REGARDING TRANSFERS AMONGAFFILIATES.

(I) SPECIAL RULE.

(aa) IN GENERAL.Clause (i) and (ii) shall not apply in the case of an amounttransferred(1) IN GENERAL.Any covered organization that makes

campaign-related disbursements aggregating more than $10,000 in acalendar year shall, not later than 24 hours after each disclosure date, file astatement with the Commission made under penalty of perjury that containsthe information described in paragraph (2) (A) in the case of the firststatement filed under this subsection, for the period beginning on the firstday of the preceding calendar year and ending on the first such disclosuredate; and (B) in the case of any subsequent state1ment filed under thissubsection, for the period beginning on the previous disclosure date andending on such disclosure date. (2) INFORMATION DESCRIBED.Theinforma1tion described in this paragraph is as follows: (A) The name of thecovered organization and the principal place of business of suchor2ganization. (B) The amount of each campaign-related disbursementmade by such organization during the period covered by the statement ofmore than $1,000.VerDate 0ct 09 2002 11:25 Feb 08, 2012 Jkt 000000 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201


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(C) In the case of a campaign-related disbursement that is not a coveredtransfer, the election to which the campaign-related disbursement pertainsand if the disbursement is made for a public communication, the name ofany candidate identified in such communication and whether suchcommunication is in support of or in opposition to a candidate. (D) Acertification by the chief executive officer or person who is the head of thecovered organization that the campaign-related dis1bursement is not madein cooperation, consulta1tion, or concert with or at the request orsug1gestion of a candidate, authorized committee, or agent of a candidate,political party, or agent of a political party. (E) If the covered organizationmakes campaign-related disbursements using exclu1sively funds in asegregated bank account consisting of funds that were contributed,donated, transferred, or paid directly to such account by persons other thanthe covered organization that controls the account, for each contribution,

donation, transfer, payment of dues, or other payment to the account

(i) the name and address of each person who made such contribution,donation, transfer, payment of dues, or other payment during the periodcovered by the statement; (ii) the date and amount of such contribution,donation, transfer, payment of dues, or other payment; and (iii) theaggregate amount of all such contributions, donations, transfers,pay1ments of dues, and other payments made by the person during theperiod beginning on the first day of the preceding calendar year and endingon the disclosure date; but only if such contribution, donation, trans1fer,payment of dues, or other payment was made by a person who madecontributions, do1nations, transfers, payments of dues, or pay1ments to theaccount in an aggregate amount of $10,000 or more during the periodbeginning on the first day of the preceding calendar year and ending on thedisclosure date. (F) Subject to paragraph (4), if the cov2ered organizationmakes campaign-related dis2bursements using funds other than funds in asegregated bank account described in subparagraph (E), for eachcontribution, donation, transfer, or payment of dues to the coveredorganization (i) the name and address of each person who made such

contribution, donation, transfer, or payment of dues during the periodcovered by the statement; (ii) the date and amount of such contribution,donation, transfer, or pay1ment of dues; and (iii) the aggregate amount ofall such contributions, donations, transfers, and payments of dues made bythe person dur1ing the period beginning on the first day of the precedingcalendar year and ending on the disclosure date; but only if suchcontribution, donation, trans1fer, or payment of dues was made by a


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person who made contributions, donations, transfers, or payments of duesto the covered organization in an aggregate amount of $10,000 or moreduring the period beginning on the first day of the preceding calendar yearand ending on the disclosure date.(3) EXCEPTIONS. (A) AMOUNTS RECEIVED IN ORDINARY COURSE OF

BUSINESS.The requirement to include in a statement filed under paragraph(1) the information described in paragraph (2) shall not apply to amountsreceived by the covered organization in the ordinary course of any trade orbusiness conducted by the covered organization or in the form ofinvestments in the covered organization. (B) DONOR RESTRICTION ON USE OFFUNDS.The requirement to include in a state1ment submitted underparagraph (1) the infor1mation described in subparagraph (F) ofpara1graph (2) shall not apply if (i) the person described in suchsub1paragraph prohibited, in writing, the use of the contribution, donation,

transfer, pay1ment of dues, or other payment made by such person forcampaign-related disburse2ments; and (ii) the covered organizationagreed to follow the prohibition and deposited the contribution, donation,transfer, payment of dues, or other payment in an account which issegregated from any account used to make campaign-relateddisbursements. (4) DISCLOSURE DATE. (A) IN GENERAL.Except asprovided in subparagraph (B), the term disclosure date means (i) thefirst date during any calendar year by which a person has made campaign-related disbursements aggregating more than $10,000; and (ii) each date

following the date de1scribed in clause (i) during such calendar year bywhich a person has made cam1paign-related disbursements aggregating

more than $10,000. (B) DISCLOSURE DATE FOR CERTAIN TRANSFERS.In thecase of a statement filed with respect to a campaign-related disburse1mentwhich is a covered transfer described in subsection (f)(1)(E), the termdisclosure date means the date on which the covered organiza2tionmaking such transfer knew or should have known that the recipient of suchtransfer made campaign-related disbursements in an aggre2gate amount of$50,000 or more during the 2-year period beginning on the date of thetransfer. (b) COORDINATION WITH OTHER PROVISIONS. (1) OTHER REPORTS

FILED WITH THE COMMISSION.Information included in a statement filed underthis section may be excluded from statements and reports filed undersection 304. (2) TREATMENT AS SEPARATE SEGREGATED FUND.A segregatedbank account referred to in subsection (a)(2)(E) may be treated as aseparate segregated fund for purposes of section 527(f)(3) of the InternalRevenue Code of 1986. (c) FILING.Statements required to be filed undersubsection (a) shall be subject to the requirements of sec1tion 304(d) to the


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same extent and in the same manner as if such reports had been requiredunder subsection (c) or (g) of section 304. (d) CAMPAIGN-RELATEDDISBURSEMENT DE1FINED.In this section, the term campaign-relateddisbursement means a disbursement by a covered organiza2tion for any ofthe following: (1) An independent expenditure consisting of a publiccommunication, as defined in section 301(22). (2) An electioneeringcommunication, as defined in section 304(f)(3).(3) A covered transfer. (e) COVERED ORGANIZATION DEFINED.In thissection, the term covered organization means any of the following: (1) Acorporation (other than an organization described in section 501(c)(3) ofthe Internal Revenue Code of 1986). (2) An organization described insection 501(c) of such Code and exempt from taxation under section501(a) of such Code (other than an organization described in section501(c)(3) of such Code). (3) A labor organization (as defined in section

316(b)). (4) Any political organization under section 527 of the InternalRevenue Code of 1986, other than a political committee under this Act(except as provided in paragraph (5)). (5) A political committee with anaccount established for the purpose of accepting donations or contributionsthat do not comply with the contribu2tion limits or source prohibitions underthis Act, but only with respect to the accounts established for such purpose.(f) COVERED TRANSFER DEFINED.(1) IN GENERAL.In this section, the term covered transfer means any

transfer or payment of funds by a covered organization to another person if

the covered organization (A) designates, requests, or suggests that theamounts be used for (i) campaign-related disbursements (other thancovered transfers); or (ii) making a transfer to another person for thepurpose of making or pay1ing for such campaign-related disburse1ments;(B) made such transfer or payment in re1sponse to a solicitation or otherrequest for a donation or payment for (i) the making of or paying forcam1paign-related disbursements (other than covered transfers); or (ii)making a transfer to another person for the purpose of making or pay2ingfor such campaign-related disburse2ments; (C) engaged in discussionswith the recipient of the transfer or payment regarding

(i) the making of or paying for campaign-related disbursements (otherthan covered transfers); or (ii) donating or transferring any amount of suchtransfer or payment to another person for the purpose of making or payingfor such campaign-related disbursements; (D) made campaign-relateddisbursements (other than a covered transfer) in an ag1gregate amount of$50,000 or more during the 2-year period ending on the date of the transferor payment, or knew or had reason to know that the person receiving the


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transfer or pay1ment made such disbursements in such an ag1gregateamount during that 2-year period; or (E) knew or had reason to know thatthe person receiving the transfer or payment would make campaign-relateddisbursements in an aggregate amount of $50,000 or more during the 2-year period beginning on the date of the transfer or payment. (2)EXCLUSIONS.The term covered transfer does not include any of thefollowing:

(A) A disbursement made by a coveredorganization in the ordinary course of any trade orbusiness conducted by the covered organization or inthe form of investments made by the coveredorganization. (B) A disbursement made by a coveredorganization if (i) the covered organization

prohibited, in writing, the use of such disbursement forcampaign-related disbursements; and (ii) the recipientof the disbursement agreed to follow the prohibition anddepos1ited the disbursement in an account which issegregated from any account used to make campaign-related disbursements. (3) EXCEPTION FOR CERTAINTRANSFERS AMONG AFFILIATES. (A) EXCEPTION FORCERTAIN TRANSFERS AMONG AFFILIATES.The term coveredtransfer does not include an amount trans2ferred byone covered organization to another coveredorganization which is treated as a transfer betweenaffiliates under subclause (II).

(bb) REPORTING BY TRANSFEREE.In the case of anysuch transfer or transfers between affiliates in an aggregateamount equal to or greater than $50,000 in a calendar year,any report filed under subparagraph (A) by the coveredorganization that receives the transferred funds shallinclude the information required under that subparagraph

relating to donations or payments made

(AA) to the affiliate which transferred the fundswhere such donations or payments were made to theaffiliate in the 12-month period prior to the transfer,and


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(BB) to any affiliate which transferred anaggregate amount equal to or greater than $50,000 toany affiliate described in subitem (AA) in the 12-monthperiod prior to the transfer.

(II) subparagraph (B) if the aggregate amounttransferred during the year by such covered organization tothat same covered organization is equal to or less than$50,000. (B) DESCRIPTION OF TRANSFERS BETWEENAFFILIATES.A transfer of amounts from one coveredorganization to another covered organization shall betreated as a transfer between affiliates if

(aa (i) one of the organizations is an affiliate of the

other organization; or

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

; except that the transfer shall not be treated as a transferbetween affiliates if one of the organizationsorga1nizations isestablished for the purpose of disbursing funds formak1ingcampaign-related activity.

(III) disbursements. (C) DETERMINATION OF AFFILIATESTATUSSTA1TUS.For purposes of subclause (II), thefollowing subparagraph (B), a covered organizations areconsidered to be affiliates of each other

(aa) a membership organization (including trade orprofessional associations) and the related State and localentities of thatis an affiliate of another coveredorganization or group;

(bb) a national or international labor if (i) thegoverning instrument of the organization and its localunions, or an requires it to be bound by decisions of theother organization of national or international unions andits State and local central bodies.


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(cc) a corporation and its wholly owned subsidiaries.

(IV) ; (ii) the governing board of the organization includes persons whoare specifi-cally designated representatives of the other organization or aremembers of the governing board, officers, or paid executive staff membersof the other organization, or whose service on the governing board iscontingent upon the approval of the other organization; or (iii) theorganization is chartered by the other organization. (D) COVERAGE OFTRANSFERS TO AFFILIATEDAF1FILIATED SECTION 501(C)(3) ORGANIZATIONS. Thisclauseparagraph shall apply with respect to an amount transferred by acovered organization to an organization described in paragraph (3) ofsection 501(c) of the Internal Revenue Code of 1986 and exempt from taxunder section 501(a) of such Code in the same manner as thisclauseparagraph applies to an amount transferredtrans1ferred by a covered

organization to another covered organization.. (2) CONFORMINGAMENDMENT.Section 304(f)(6) of such Act (2 U.S.C. 434) is amended bystriking Any requirement and inserting Except as provided in section324(b), any requirement.

(iv) SPECIAL THRESHOLD FOR DISCLOSURE OF DONORS.Notwithstanding clause (i) or (ii) of subparagraph (A), if a coveredorganization is required to include the identification of a persondescribed in such clause in a report filed under this subsection

because the covered organization is deemed (in accordance withclause (ii)) to have transferred amounts for the purpose of making apublic independent expenditure or because clause (iii)(I)(bb)applies to such covered organization, the organization shall includethe identification of the person only if the person made donations orpayments (in the case of a person described in clause (i)(I) ofsubparagraph (A)) or unrestricted donor payments (in the case of aperson described in clause (ii) of subparagraph (A)) to the coveredorganization during the covered organization reporting periodinvolved in an aggregate amount equal to or exceeding $10,000.

(C) EXCLUSION OF AMOUNTS DESIGNATED FOR OTHERCAMPAIGN-RELATED ACTIVITY.For purposes of subparagraph (A)(i),in determining the amount of a donation or payment made by a personwhich was provided for the purpose of being used for campaign-relatedactivity or in response to a solicitation for funds to be used for


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campaign-related activity, there shall be excluded any amount whichwas designated by the person to be used

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

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

(D) EXCLUSION OF AMOUNTS PAID FROM SEPARATE SEGREGATEDFUND.In determining the amount of public independent expenditures

made by a covered organization for purposes of this paragraph, thereshall be excluded any amounts paid from a separate segregated fundestablished and administered by the organization under section316(b)(2)(C).

(E) COVERED ORGANIZATION REPORTING PERIOD DESCRIBED.In this paragraph, the covered organization reporting period is, withrespect to a report filed by a covered organization under thissubsection

(i) in the case of the first report filed by a covered organizationunder this subsection which includes information required underthis paragraph, the shorter of

(I) the period which begins on the effective date of theDemocracy is Strengthened by Casting Light on Spending inElections 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 coveredorganization under this subsection which includes informationrequired under this paragraph, the period occurring since the most


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recent report filed by the organization which includes suchinformation.

(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), otherthan a corporation which is an organization described in paragraph(3) of section 501(c) of the Internal Revenue Code of 1986 andexempt from tax under section 501(a) of such Code.

(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 exemptfrom tax under section 501(a) of such Code, other than an exemptsection 501(c)(4) organization (as defined in section 301(27)).

(iv) Any political organization under section 527 of theInternal Revenue Code of 1986, other than a political committeeunder this Act.

(G) OTHER DEFINITIONS.In this paragraph

(i) the terms campaign-related activity and unrestricteddonor payment have the meaning given such terms in section 325;and

(ii) the term public independent expenditure means anindependent expenditure for a public communication (as defined insection 301(22))..

(b) ELECTIONEERING COMMUNICATION REPORTS.

(1) IN GENERAL.Section 304(f) of such Act () is amended

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

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


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(6) DISCLOSURE OF ADDITIONAL INFORMATION BY COVEREDORGANIZATIONS.

(A) ADDITIONAL INFORMATION.If a covered organization files

a statement under this subsection, the statement shall include, inaddition to the information required under paragraph (2), the followinginformation (subject to subparagraph (B)(iv)):

(i) If any person made a donation or payment to the coveredorganization during the covered organization reporting periodwhich was provided for the purpose of being used for campaign-related activity or in response to a solicitation for funds to be usedfor campaign-related activity

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

(II) if any person identified under subclause (I) designated

that the donation or payment be used for campaign-relatedactivity with respect to a specific election or in support of aspecific candidate, the name of the election or candidateinvolved, and if any such person designated that the donation orpayment be used for a specific electioneering communication, adescription of the communication.

(ii) The identification of each person who made unrestricteddonor payments to the organization during the covered organization

reporting period

(I) in an aggregate amount equal to or exceeding $1,000during such period, if the organization made any of thedisbursements which are described in subclause (II) from asource other than the organizations Campaign-Related ActivityAccount under section 326; or


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(II) in an aggregate amount equal to or exceeding $10,000during such period, if the organization made from itsCampaign-Related Activity Account under section 326 all of itsdisbursements for electioneering communications during such

period which are, on the basis of a reasonable belief by theorganization, subject to treatment as disbursements for anexempt function for purposes of section 527(f) of the InternalRevenue Code of 1986 (but only if the organization has madedeposits described in subparagraph (D) of section 326(a)(2)into that Account during such period in an aggregate amountequal to or greater than $10,000),

presented in the order of the aggregate amount of payments madeby such persons during such period (with the identification of theperson making the largest payment appearing first).

(B) TREATMENT OF TRANSFERS MADE TO OTHER PERSONS.

(i) IN GENERAL.Subject to clause (iii), for purposes of therequirement to file statements under this subsection (including therequirement under subparagraph (A) to include additionalinformation in such statements), a covered organization whichtransfers amounts to another person (other than the covered

organization itself) for the purpose of making an electioneeringcommunication by that person or by any other person, or (inaccordance with clause (ii)) which is deemed to have transferredamounts to another person (other than the covered organizationitself) for the purpose of making an electioneering communicationby that person or by any other person, shall be considered to havemade a disbursement for an electioneering communication.

(ii) RULES FOR DEEMING TRANSFERS MADE FOR PURPOSE OF

MAKING COMMUNICATIONS.For purposes of clause (i), indetermining whether a covered organization which transfersamounts to another person shall be deemed to have transferred theamounts for the purpose of making an electioneeringcommunication, the following rules apply:


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(I) The covered organization shall be deemed to havetransferred the amounts for the purpose of making anelectioneering communication if

(aa) the covered organization designates, requests, orsuggests that the amounts be used for electioneeringcommunications and the person to whom the amounts weretransferred agrees to do so;

(bb) the person making the electioneeringcommunication or another person acting on that personsbehalf expressly solicited the covered organization for adonation or payment for making or paying for anyelectioneering communications;

(cc) the covered organization and the person to whomthe amounts were transferred engaged in written or oraldiscussion regarding the person either making, or payingfor, any electioneering communication, or donating ortransferring the amounts to another person for that purpose;

(dd) the covered organization which transferred thefunds knew or had reason to know that the person to whom

the amounts were transferred intended to makeelectioneering communications; or

(ee) the covered organization which transferred thefunds or the person to whom the amounts were transferredmade one or more electioneering communications in anaggregate amount of $50,000 or more during the 2-yearperiod which ends on the date on which the amounts weretransferred.

(II) The covered organization shall not be deemed to havetransferred the amounts for the purpose of making anelectioneering communication if

(aa) the transfer was a commercial transactionoccurring in the ordinary course of business between the


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covered organization and the person to whom the amountswere transferred, unless there is affirmative evidence thatthe amounts were transferred for the purpose of making anelectioneering communication; or

(bb) the covered organization and the person to whomthe amounts were transferred mutually agreed (as providedin section 325(b)(1)) that the person will not use theamounts for campaign-related activity.

(iii) SPECIAL RULE REGARDING TRANSFERS AMONGAFFILIATES.

(I) SPECIAL RULE.

(aa) IN GENERAL.Clause (i) and (ii) shall not applyin the case of an amount transferred by one coveredorganization to another covered organization which istreated as a transfer between affiliates under subclause (II).

(bb) REPORTING BY TRANSFEREE.In the case of anysuch transfer or transfers between affiliates in an aggregateamount equal to or greater than $50,000 in a calendar year,

any report filed under subparagraph (A) by the coveredorganization that receives the transferred funds shallinclude the information required under that subparagraphrelating to donations or payments made

(AA) to the affiliate which transferred the fundswhere such donations or payments were made to theaffiliate in the 12-month period prior to the transfer,and

(BB) to any affiliate which transferred anaggregate amount equal to or greater than $50,000 toany affiliate described in subitem (AA) in the 12-monthperiod prior to the transfer.


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(II) DESCRIPTION OF TRANSFERS BETWEENAFFILIATES.A transfer of amounts from one coveredorganization to another covered organization shall be treated asa transfer between affiliates if

(aa) one of the organizations is an affiliate of the otherorganization; or

(bb) each of the organizations is an affiliate of thesame organization,

except that the transfer shall not be treated as a transfer betweenaffiliates if one of the organizations is established for thepurpose of disbursing funds for campaign-related activity.

(III) DETERMINATION OF AFFILIATE STATUS.Forpurposes of subclause (II), the following covered organizationsare considered to be affiliates of each other

(aa) a membership organization (including trade orprofessional associations) and the related State and localentities of that organization or group;

(bb) a national or international labor organization andits local unions, or an organization of national orinternational unions and its State and local central bodies.

(cc) a corporation and its wholly owned subsidiaries.

(IV) COVERAGE OF TRANSFERS TO AFFILIATED SECTION501(C)(3) ORGANIZATIONS.This clause shall apply withrespect to an amount transferred by a covered organization toan organization described in paragraph (3) of section 501(c) of

the Internal Revenue Code of 1986 and exempt from tax undersection 501(a) of such Code in the same manner as this clauseapplies to an amount transferred by a covered organization toanother covered organization.


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(iv) SPECIAL THRESHOLD FOR DISCLOSURE OF DONORS.Notwithstanding clause (i) or (ii) of subparagraph (A), if a coveredorganization is required to include the identification of a persondescribed in such clause in a statement filed under this subsection

because the covered organization is deemed (in accordance withclause (ii)) to have transferred amounts for the purpose of makingan electioneering communication, the organization shall include theidentification of the person only if the person made donations orpayments (in the case of a person described in clause (i)(I) ofsubparagraph (A)) or unrestricted donor payments (in the case of aperson described in clause (ii) of subparagraph (A)) to the coveredorganization during the covered organization reporting periodinvolved in an aggregate amount equal to or exceeding $10,000.

(C) EXCLUSION OF AMOUNTS DESIGNATED FOR OTHERCAMPAIGN-RELATED ACTIVITY.For purposes of subparagraph (A)(i),in determining the amount of a donation or payment made by a personwhich was provided for the purpose of being used for campaign-relatedactivity or in response to a solicitation for funds to be used forcampaign-related activity, there shall be excluded any amount whichwas 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) withrespect to a different election, or with respect to a candidate in adifferent election, than an election which is the subject of any of thepublic independent expenditures covered by the report involved; or

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

(D) COVERED ORGANIZATION REPORTING PERIOD DESCRIBED.

In this paragraph, the covered organization reporting period is, withrespect to a statement filed by a covered organization under thissubsection

(i) in the case of the first statement filed by a coveredorganization under this subsection which includes informationrequired under this paragraph, the shorter of


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(I) the period which begins on the effective date of theDemocracy is Strengthened by Casting Light on Spending inElections Act and ends on the disclosure date for the statement,or

(II) the 12-month period ending on the disclosure date forthe statement; and

(ii) in the case of any subsequent statement filed by a coveredorganization under this subsection which includes informationrequired under this paragraph, the period occurring since the mostrecent statement filed by the organization which includes suchinformation.

(E) COVERED ORGANIZATION DEFINED.In this paragraph, theterm covered organization means any of the following:

(i) Any corporation which is subject to section 316(a), otherthan a corporation which is an organization described in paragraph(3) of section 501(c) of the Internal Revenue Code of 1986 andexempt from tax under section 501(a) of such Code.

(ii) Any labor organization (as defined in section 316).

(iii) Any organization described in paragraph (4), (5), or (6) ofsection 501(c) of the Internal Revenue Code of 1986 and exemptfrom tax under section 501(a) of such Code, other than an exemptsection 501(c)(4) organization (as defined in section 301(27)).

(iv) Any political organization under section 527 of theInternal Revenue Code of 1986, other than a political committeeunder this Act.

(F) OTHER DEFINITIONS.In this paragraph, the terms campaign-related activity and unrestricted donor payment have the meaninggiven such terms in section 325..

(2) CONFORMING AMENDMENT.Section 304(f)(2) of such Act (2U.S.C. 434(f)(2)) is amended by striking If the disbursements each place


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it appears in subparagraph (E) and (F) and inserting the following: Exceptin the case of a statement which is required to include additionalinformation under paragraph (6), if the disbursements.

(c) EXEMPTION OF CERTAIN SECTION 501(C)(4)ORGANIZATIONS.Section 301 of such Act () is amended by adding at the end the following:

(27) EXEMPT SECTION 501(C)(4) ORGANIZATION.The term exemptsection 501(c)(4) organization means, with respect to disbursements madeby an organization during a calendar year, an organization for which thechief executive officer of the organization certifies to the Commission (priorto the first disbursement made by the organization during the year) that eachof the following applies:

(A) The organization is described in paragraph (4) of section501(c) of the Internal Revenue Code of 1986 and exempt from taxunder section 501(a) of such Code, and was so described and so exemptduring each of the 10 previous calendar years.

(B) The organization has at least 500,000 individuals who paidmembership dues during the previous calendar year (determined as ofthe last day of that year).

(C) The dues-paying membership of the organization includes atleast one individual from each State. For purposes of this subparagraph,the term State means each of the several States, the District ofColumbia, and the Commonwealth of Puerto Rico.

(D) During the previous calendar year, the portion of fundsprovided to the organization by corporations (as described in section316) or labor organizations (as defined in section 316), other than fundsprovided pursuant to commercial transactions occurring in the ordinarycourse of business, did not exceed 15 percent of the total amount of all

funds provided to the organization from all sources.

(E) The organization does not use any of the funds provided to theorganization by corporations (as described in section 316) or labororganizations (as defined in section 316) for campaign-related activity(as defined in section 325)..


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SEC. 212. RULES REGARDING USE OF GENERAL TREASURY FUNDS BY COVEREDORGANIZATIONS FOR CAMPAIGN-RELATED ACTIVITY.

Title III of the Federal Election Campaign Act of 1971 () is amended byadding at the end the following new section:

SEC. 325. SPECIAL RULES FOR USE OF GENERAL TREASURY FUNDS BY COVEREDORGANIZATIONS FOR CAMPAIGN-RELATED ACTIVITY.

(a) USE OF FUNDS FOR CAMPAIGN-RELATED ACTIVITY.

(1) IN GENERAL.Subject to any applicable restrictions andprohibitions under this Act, a covered organization may makedisbursements for campaign-related activity using

(A) amounts paid or donated to the organization which aredesignated by the person providing the amounts to be used forcampaign-related activity;

(B) unrestricted donor payments made to the organization; and

(C) other funds of the organization, including amounts receivedpursuant to commercial activities in the regular course of a coveredorganizations business.

(2) NO EFFECT ON USE OF SEPARATE SEGREGATED FUND.Nothing inthis section shall be construed to affect the authority of a coveredorganization to make disbursements from a separate segregated fundestablished and administered by the organization under section316(b)(2)(C).

(b) MUTUALLY AGREED RESTRICTIONS ON USE OF FUNDS FORCAMPAIGN-RELATED ACTIVITY.

(1) AGREEMENT AND CERTIFICATION.If a covered organization anda person mutually agree, at the time the person makes a donation, payment,or transfer to the organization which would require the organization todisclose the persons identification under section 304(g)(5)(A)(ii) or section304(f)(6)(A)(ii), that the organization will not use the donation, payment, ortransfer for campaign-related activity, then not later than 30 days after the


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organization receives the donation, payment, or transfer the organizationshall transmit to the person a written certification by the chief financialofficer of the covered organization (or, if the organization does not have achief financial officer, the highest ranking financial official of the

organization) that

(A) the organization will not use the donation, payment, or transferfor campaign-related activity; and

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

(2) EXCEPTION FOR PAYMENTS MADE PURSUANT TO COMMERCIALACTIVITIES.Paragraph (1) does not apply with respect to any payment ortransfer made pursuant to commercial activities in the regular course of acovered organizations business.

(c) CERTIFICATIONS REGARDING DISBURSEMENTS FOR CAMPAIGN-RELATED ACTIVITY.

(1) CERTIFICATION BY CHIEF EXECUTIVE OFFICER.If, at any timeduring a calendar quarter, a covered organization makes a disbursement offunds for campaign-related activity using funds described in subsection(a)(1), the chief executive officer of the covered organization or the chiefexecutive officers designee (or, if the organization does not have a chiefexecutive officer, the highest ranking official of the organization or thehighest ranking officials designee) shall file a statement with theCommission which contains the following certifications:

(A) None of the campaign-related activity for which theorganization disbursed the funds during the quarter was made incooperation, consultation, or concert with, or at the request orsuggestion of, any candidate or any authorized committee or agent ofsuch candidate, or political committee of a political party or agent ofany political party.


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

(C) Each statement and report filed by the organization undersection 304 with respect to any such disbursement made during thequarter is complete and accurate.

(D) All such disbursements made during the quarter are incompliance with this Act.

(E) No portion of the amounts used to make any suchdisbursements during the quarter is attributable to funds received by the

organization that were subject to a mutual agreement (as provided insubsection (b)(1)) that the organization will not use the funds forcampaign-related activity by the person who provided the funds frombeing 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 thesame manner as such section applies with respect to a statement undersubsection (c) or (g) of section 304.

(3) DEADLINE.The chief executive officer or highest ranking officialof a covered organization (as the case may be) shall file the statementrequired under this subsection with respect to a calendar quarter not laterthan 15 days after the end of the quarter.

(d) DEFINITIONS.For purposes of this section, the following definitionsapply:

(1) COVERED ORGANIZATION.The term covered organizationmeans any of the following:

(A) Any corporation which is subject to section 316(a), other thana corporation which is an organization described in paragraph (3) ofsection 501(c) of the Internal Revenue Code of 1986 and exempt fromtax under section 501(a) of such Code.


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(B) Any labor organization (as defined in section 316).

(C) Any organization described in paragraph (4), (5), or (6) ofsection 501(c) of the Internal Revenue Code of 1986 and exempt fromtax under section 501(a) of such Code, other than an exempt section501(c)(4) organization (as defined in section 301(27)).

(D) Any political organization under section 527 of the InternalRevenue 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 publiccommunication (as defined in section 301(22)), a transfer of fundsto another person (other than the transferor itself) for the purpose ofmaking such an independent expenditure by that person or by anyother person (subject to subparagraph (C)), or (in accordance withsubparagraph (B) and subject to subparagraph (C)) a transfer offunds to another person (other than the transferor itself) which isdeemed to have been made for the purpose of making such anindependent expenditure by that person or by any other person; or

(ii) an electioneering communication, a transfer of funds toanother person (other than the transferor itself) for the purpose ofmaking an electioneering communication by that person or by anyother person (subject to subparagraph (C)), or (in accordance withsubparagraph (B) and subject to subparagraph (C)) a transfer offunds to another person (other than the transferor itself) which isdeemed to have been made for the purpose of making anelectioneering communication by that person or by any otherperson.

(B) RULE FOR DEEMING TRANSFERS MADE FOR PURPOSE OFCAMPAIGN-RELATED ACTIVITY.For purposes of subparagraph (A), indetermining whether a transfer of funds by a covered organization toanother person shall be deemed to have been made for the purpose ofmaking an independent expenditure consisting of a public


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communication or an electioneering communication, the following rulesapply:

(i) The transfer shall be deemed to have been made for thepurpose of making such an independent expenditure or anelectioneering communication if

(I) the covered organization designates, requests, orsuggests that the amounts be used for such independentexpenditures or electioneering communications and the personto whom the amounts were transferred agrees to do so;

(II) the person making such independent expenditures orelectioneering communications or another person acting on that

persons behalf expressly solicited the covered organization fora donation or payment for making or paying for any suchindependent expenditure or electioneering communication;

(III) the covered organization and the person to whom theamounts were transferred engaged in written or oral discussionregarding the person either making, or paying for, suchindependent expenditures or electioneering communications, ordonating or transferring the amounts to another person for that

purpose;

(IV) the covered organization which transferred the fundsknew or had reason to know that the person to whom theamounts were transferred intended to make such independentexpenditures or electioneering communications; or

(V) the covered organization which transferred the fundsor the person to whom the amounts were transferred made oneor more such independent expenditures or electioneering

communications in an aggregate amount of $50,000 or moreduring the 2-year period which ends on the date on which theamounts were transferred.


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(ii) The transfer shall not be deemed to have been made for thepurpose of making such an independent expenditure or anelectioneering communication if

(I) the transfer was a commercial transaction occurring inthe ordinary course of business between the coveredorganization and the person to whom the amounts weretransferred, unless there is affirmative evidence that theamounts were transferred for the purpose of making such anindependent expenditure or electioneering communication; or

(II) the covered organization and the person to whom theamounts were transferred mutually agreed (as provided insubsec

Redline of 2010 and 2012 DISCLOSE Act

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