By:  Lucio                                                        S.B. No. 1827


A BILL TO BE ENTITLED

AN ACT

relating to misrepresentation concerning political activity of a 
tax-exempt organization; providing a civil penalty.
	BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:                        
	SECTION 1.  Chapter 255, Election Code, is amended by adding 
Section 255.009 to read as follows:
	Sec. 255.009.  MISREPRESENTATION OF POLITICAL ACTIVITY OF 
TAX-EXEMPT ORGANIZATION.  (a)  In this section, "tax-exempt 
organization" means an organization that is exempt from income 
taxation under Section 501(a), Internal Revenue Code, by being 
listed under Section 501(c)(6), Internal Revenue Code, or such an 
organization's affiliated organizations that are exempt from 
income taxation by being listed under Section 501(c)(3), Internal 
Revenue Code.  The term includes the parent organization of a 
tax-exempt organization.
	(b)  A person may not, with intent to injure a candidate or 
influence the result of an election and without the written 
permission of the organization, knowingly represent in a campaign 
communication that:
		(1)  the communication is from a tax-exempt 
organization; or                
		(2)  a tax-exempt organization supports or opposes a 
candidate or political party.
	(c)  A person may not, with intent to injure a candidate or 
influence the result of an election and without the written 
permission of the officer, member, or employee, as appropriate, 
knowingly represent in a campaign communication that:
		(1)  the communication is from a former or current 
officer, member, or employee of a tax-exempt organization; or
		(2)  a former or current officer, member, or employee 
of a tax-exempt organization supports or opposes a candidate or 
political party.
	(d)  A person may not:                                                         
		(1)  with intent to injure a candidate or influence the 
result of an election, knowingly make a misrepresentation or fail 
to disclose facts relating to an activity of a tax-exempt 
organization or a current or former officer, member, or employee of 
a tax-exempt organization; and
		(2)  the misrepresentation or failure to disclose 
endangers the tax-exempt status of the organization under:
			(A)  the Internal Revenue Code or regulations 
adopted by the Internal Revenue Service; or
			(B)  the Tax Code or rules adopted by the 
comptroller.                     
	(e)  A person injured by a violation of this section has a 
cause of action under Chapter 73, Civil Practice and Remedies Code.
	(f)  A person is entitled to recover reasonable attorney's 
fees if the person prevails in:
		(1)  an action under Chapter 73, Civil Practice and 
Remedies Code, that arises from a violation of this section; or
		(2)  a judicial or administrative proceeding that 
relates to the tax-exempt status of an organization and that arises 
from a violation of Subsection (d).
	SECTION 2.  This Act takes effect September 1, 2003.                           
	SECTION 3.  Section 255.009, Election Code, as added by this 
Act, applies only to a campaign communication, as defined by 
Section 251.001, Election Code, that is first distributed on or 
after September 1, 2003.