CONTENTS Page 1 a. Sources b. Interpretation.. 3. Historical development of Federal election law. 4. The existing Federal law on the subject of campaign finances. 7. Inadequacies of the existing law 8. The structure and purpose of H. R. 18162_ 9. Topical digest and explanation of H. R. 18162. (11) Registration of political committees, statements. 600. Promise of employment or other benefit for political 608. Limitations on political contributions and purchases. (1) Federal Elections Commission_ (2) Organization of political committees.. (3) Registration of political committees; statements. (4) Reports by political committees and candidates.. (5) Reports by others than political committees... (6) Formal requirements respecting reports and statements. (7) Reports on convention financing- (8) Duties of the Commission.. Statements filed with clerk of U.S. courts. (10) Prohibition of contributions in name of another_ (15) Citation__ (1) Statement of gifts to be filed_. (2) Statement of honorariums to be filed_ ELECTION REFORM ACT OF 1966 1. BACKGROUND OF H.R. 18162 H.R. 18162 is the result of a comprehensive study made by the Subcommittee on Elections of the Committee on House Administration. In its deliberations, the subcommittee considered the present state of the Federal election law and a series of legislative proposals. These included H.R. 15317, proposed by the President, and a series of related bills, H.R. 16203, H.R. 16219, H.R. 16220, H.R. 16221, H.R. 16222, H.R. 16223, H.R. 16224, H.R. 16225, H.R. 16226, H.R. 16227, H.R. 16228, H.R. 16318, H.R. 16428, H.R. 16741, and H.R. 16875. Four days of hearings were held by the subcommittee, which gave subsequent consideration to many aspects of laws and proposals relating to political finance. H.R. 18162 was reported favorably and with bipartisan support by the subcommittee on October 3, 1966. The bill, H.R. 18162, represents a large advance in legislation dealing with political finance. It constitutes a vast improvement over existing law, which is contained primarily in the Federal Corrupt Practices Act of 1925 and in the Hatch Political Activities Act of 1939. 2. CONSTITUTIONAL FOUNDATIONS OF THE POWER OF the Congress TO LEGISLATE IN MATTERS OF ELECTIONS SOURCES The following provisions of the Constitution determine and cirl cumscribe the power of Congress to legislate on the subject of Federa elections: Article I, section 2.-The House of Representatives shall be composed of Members chosen every second year by the people of the several States, and the Electors in each State shall have the qualifications requisite for electors of the most numerous branch of the State Legislature. Amendment XVII.-The Senate of the United States shall be composed of two Senators from each State, elected by the people thereof, for six years; and each Senator shall have one vote. The electors in each State shall have the qualifications requisite for electors of the most numerous branch of the State Legislatures.* ** Article II, section 1, clause 2.-Each State shall appoint, in such manner as the Legislature thereof may direct, a number of electors, equal to the whole number of Senators and Representatives to which the State may be entitled in the Congress: but no Senator or Representative, or person holding an Office of trust or profit under the United States, shall be appointed an Elector. Article I, section 4.-The times, places and manner of holding elections for Senators and Representatives, shall be prescribed in each State by the Legislature thereof; but the Congress may at any time by law make or alter such regulations except as to the places of choosing Senators. Article I, section 8, clause 18.—To make all laws which shall be necessary and proper for carrying into execution the foregoing Powers, and all other powers vested by this Constitution in the Government of the United States, or in any Department or Officer thereof. Article I, section 5.-Each House shall be the Judge of the elections, returns, and qualifications of its own Members * * 1 Amendment I.-Congress shall make no law *** abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the government for a redress of grievances. INTERPRETATION In the domain of elections, the Constitution permits the States to determine the qualifications of electors voting for congressional candidates and the manner of appointing presidential and vice-presidential electors. Furthermore, the Constitution makes the States primarily responsible for laws relating to the times, places, and manner of elections for Senators and Representatives. On the other hand, Congress can at any time make or alter such laws. Only the places of choosing members of Congress is left outside of congressional jurisdiction. Moreover, each House of the Congress is given the exclusive power to judge the elections, returns, and qualifications of its Members. In addition, the "necessary and proper clause" places at the disposal of Congress the fullness of legislative means to make effective the grant of specific powers (McCulloch v. Maryland, 4 Wheat. 316). Consequently, Congress possesses a wide range of authority to regulate Federal elections in prenomination and election phases. Aside from the powers reserved in this field to the States, only the first amendment would prevent Congress from establishing regulations that would infringe on the right of free speech and assembly. Members of the subcommittee felt that the bill is fully within the legislative grant of the Constitution. 3. HISTORICAL DEVELOPMENT OF FEDERAL ELECTION LAWS Federal legislation relating to money in politics first took the form of protection against political assessment of Federal employees in 1867. This provision was later extended and broadened in the Civil Service Reform Act of 1883 which forbade the solicitation of campaign funds from any Federal officer or employee by a fellow officer or employee, or by any other persons on Federal premises. The Tillman Act of 1907 prohibited political contributions by national banks and corporations in elections of Federal officials. A 1910 act of Congress, providing for publicity of election campaign receipts and expenditures, was amended in 1911 to require similar preelection statements and to limit the amounts that could be spent by candidates for the House and Senate. These provisions extended to primary elections and conventions, but this coverage was later struck down by the Supreme Court. Relevant Federal legislation was codified and revised, but not substantially changed, in the Federal Corrupt Practices Act of 1925, which still remains the basic law although amendments were made to some of its provisions in 1944, 1947, and 1948. The Hatch Act, enacted in 1939 and amended in 1940, established a $5,000 limitation, backed by criminal sanctions, on the size of individual contributions made during a calendar year in connection with a campaign for Federal office; the act also put a $3 million limitation on the amount that can be spent by an interstate political committee, to influence or attempt to influence the election of a candidate for Federal office. The 1907 prohibition against corporate contributions has been complemented by similar ones against contributions by labor unions in both the Smith-Connally Act of 1944 and the Taft-Hartley Act of 1947. Thus it is unlawful either for unions or corporations to make direct contributions or expenditures in any Federal election, including a primary election, political convention, or caucus. 4. THE EXISTING FEDERAL LAW ON THE SUBJECT OF CAMPAIGN FINANCES The Federal Corrupt Practices Act of 1925 was enacted as title III, sections 301-318, of "An act reclassifying the salaries of postmaster and employees of the postal service, readjusting their salaries and compensation on an equitable basis, increasing postal rates to provide for such readjustment, and for other purposes.' Subsequently, the Corrupt Practices Act was split into two parts. Sections 310-313 were repealed and enacted into positive law as sections 597, 599, and 610 of title 18, United States Code. The remaining sections of the Corrupt Practices Act appear as sections 241-248 and 252-255 of title 2, United States Code, which has not yet been enacted into positive law. Hereinafter these portions of the Corrupt Practices Act are cited by the original section numbers followed for the sake of convenience by a reference to title 2, United States Code. The Hatch Political Activities Act of 1939, "An act to prevent pernicious political activities," was enacted August 2, 1939 (Public Law 252, 76th Cong.), and was subsequently amended several times. In the present state of the law, the original sections of the Hatch Act have become sections 594, 595, 598, 600, 601, 604, 605, 608, 609, and 611 of title 18, United States Code, and appear as sections 118i, 118k, 118k-1, 118k-2, 118k-3, 1181, 118m, and 18n of title 5, United States Code. In addition, sections 591, 602, and 612 of title 18, United States Code, relate to regulation of elections. 5. PHILOSOPHY OF THE EXISTING LAW Existing Federal laws relating to political finance contain numerous prohibitions, limitations, and restrictions. Early enactments were designed to remedy or prevent flagrant abuses at a time when political costs were relatively low and funds came from a limited number of sources. Efforts to prevent excessive spending usually took the form of imposing limitations on expenditures. The rationale was that limitations would prevent money from being a dominant factor in elections and would lessen undue advantages of better financed candidates and parties. Efforts to lessen the degree of candidate. dependence upon any one person or interest group usually took the form of imposing limitations on contributions, or prohibiting contributions from certain sources. In the regulatory pattern, in addition, there has been an underlying pattern of reliance upon public reporting of campaign contributions and expenditures, based upon the assumed cleansing and policing power of disclosure and publicity. Publicity was designed as a preventive rather than as a punitive measure, and as a supplement to |