1-1 By: Madden (Senate Sponsor - Armbrister) H.C.R. No. 77 1-2 (In the Senate - Received from the House March 22, 2001; 1-3 March 26, 2001, read first time and referred to Committee on State 1-4 Affairs; May 7, 2001, reported favorably by the following vote: 1-5 Yeas 7, Nays 0; May 7, 2001, sent to printer.) 1-6 HOUSE CONCURRENT RESOLUTION 1-7 WHEREAS, In an attempt to enact meaningful campaign finance 1-8 reform legislation, the 106th Congress of the United States passed 1-9 the Full and Fair Political Activities Disclosure Act (Public Law 1-10 106-230), which imposed notification and reporting requirements on 1-11 political organizations claiming tax-exempt status under Section 1-12 527 of the Internal Revenue Code; and 1-13 WHEREAS, Public Law 106-230 took effect July 1, 2000, four 1-14 days after its introduction; the rapidity of its passage through 1-15 congress reflected the lawmakers' sense of urgency to act, but it 1-16 also suggests that adequate time was not provided for deliberation 1-17 of the full ramifications of certain provisions; and 1-18 WHEREAS, The goal of this legislation was to respond to 1-19 certain political organizations, known as "stealth PACs," that were 1-20 able to raise and spend unlimited amounts of money for political 1-21 advocacy without having to disclose the sources and amounts of 1-22 donations, all while enjoying tax-exempt status; and 1-23 WHEREAS, While the Texas Legislature supports the laudable 1-24 goal of holding all participants in the political process 1-25 accountable to the public, the members of this body believe that 1-26 this well-intentioned Act has had unintended consequences and has 1-27 adversely affected individuals and organizations beyond its 1-28 original intent; and 1-29 WHEREAS, Public Law 106-230 imposes duplicative and 1-30 burdensome federal reporting and disclosure requirements on local 1-31 and state candidates, their campaign committees, and local and 1-32 state political parties that already are required to file detailed 1-33 reports with their respective state election officials; and 1-34 WHEREAS, These requirements have created a paperwork 1-35 nightmare for entities that are clearly outside the intended scope 1-36 of PL 106-230 without significantly adding to the body of 1-37 information available to the public; and 1-38 WHEREAS, A remedy in the form of an exemption for those 1-39 entities or an exception for information reported and filed 1-40 elsewhere with state officials would not violate the intention of 1-41 enforcing public accountability, since the individuals and 1-42 organizations affected already are required to report and disclose 1-43 to the state the same information that PL 106-230 now requires them 1-44 to report to the Internal Revenue Service; nor would it be 1-45 unprecedented, since a similar exemption already exists for 1-46 candidates, campaign committees, and party organizations engaged in 1-47 federal elections, who are required by FECA to report that 1-48 information to the Federal Election Commission; now, therefore, be 1-49 it 1-50 RESOLVED, That the 77th Legislature of the State of Texas 1-51 hereby respectfully urge the Congress of the United States to amend 1-52 provisions of the Internal Revenue Code of 1986, as added by PL 1-53 106-230, to exempt state and local political committees that are 1-54 required to report to their respective states from notification and 1-55 reporting requirements imposed by PL 106-230; and, be it further 1-56 RESOLVED, That the Texas secretary of state forward official 1-57 copies of this resolution to the president of the United States, to 1-58 the speaker of the house of representatives and the president of 1-59 the senate of the United States Congress, and to all the members of 1-60 the Texas delegation to the congress with the request that this 1-61 resolution be officially entered in the Congressional Record as a 1-62 memorial to the Congress of the United States of America. 1-63 * * * * *