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[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[H.R. 3617 Introduced in House (IH)]

108th CONGRESS
  1st Session
                                H. R. 3617

  To amend the Internal Revenue Code of 1986 to reform the system of 
  public financing for presidential elections, and for other purposes.

_______________________________________________________________________

                    IN THE HOUSE OF REPRESENTATIVES

                           November 21, 2003

 Mr. Meehan (for himself and Mr. Shays) introduced the following bill; 
  which was referred to the Committee on House Administration, and in 
    addition to the Committee on Ways and Means, for a period to be 
subsequently determined by the Speaker, in each case for consideration 
  of such provisions as fall within the jurisdiction of the committee 
                               concerned

_______________________________________________________________________

                                 A BILL

 
  To amend the Internal Revenue Code of 1986 to reform the system of 
  public financing for presidential elections, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Presidential Funding Act of 2003''.

SEC. 2. REVISIONS TO SYSTEM OF PRESIDENTIAL PRIMARY MATCHING PAYMENTS.

    (a) Increase in Matching Rate for Payments.--Section 9034(a) of the 
Internal Revenue Code of 1986 is amended by striking ``an amount equal 
to the amount'' and inserting ``an amount equal to 400 percent of the 
amount''.
    (b) Eligibility Requirements.--
            (1) Amount of aggregate contributions per state.--Section 
        9033(b)(3) of such Code is amended by striking ``$5,000'' and 
        inserting ``$15,000''.
            (2) Participation in system for payments for general 
        election.--Section 9033(b) of such Code is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (3);
                    (B) by striking the period at the end of paragraph 
                (4) and inserting ``; and''; and
                    (C) by adding at the end the following new 
                paragraph:
            ``(5) if the candidate is nominated by a political party 
        for election to the office of President, the candidate will 
        apply for and accept payments with respect to the general 
        election for such office in accordance with chapter 95, 
        including the requirement that the candidate and the 
        candidate's authorized committees will not incur qualified 
        campaign expenses in excess of the aggregate payments to which 
        they will be entitled under section 9004. ''.
    (c) Period of Availability of Payments.--Section 9032(6) of such 
Code is amended by striking ``the beginning of the calendar year'' and 
inserting ``July 1 of the calendar year preceding the calendar year''.
    (d) Increase in Limitation on Total Amount of Payments.--Section 
9034(b) of such Code is amended by striking ``50 percent'' and 
inserting ``80 percent''.

SEC. 3. REQUIRING PARTICIPATION IN PRIMARY PAYMENT SYSTEM AS CONDITION 
              OF ELIGIBILITY FOR GENERAL ELECTION PAYMENTS.

    (a) Major Party Candidates.--Section 9003(b) of the Internal 
Revenue Code of 1986 is amended--
            (1) by redesignating paragraphs (1) and (2) as paragraphs 
        (2) and (3); and
            (2) by inserting before paragraph (2) (as so redesignated) 
        the following new paragraph:
            ``(1) the candidate received payments under chapter 96 for 
        the campaign for nomination;''.
    (b) Minor Party Candidates.--Section 9003(c) of such Code is 
amended--
            (1) by redesignating paragraphs (1) and (2) as paragraphs 
        (2) and (3); and
            (2) by inserting before paragraph (2) (as so redesignated) 
        the following new paragraph:
            ``(1) the candidate received payments under chapter 96 for 
        the campaign for nomination;''.

SEC. 4. REVISIONS TO CANDIDATE EXPENDITURE LIMITS.

    (a) Increase in Limit on Coordinated Party Expenditures.--Section 
315(d)(2) of the Federal Election Campaign Act of 1971 (2 U.S.C. 
441a(d)(2)) is amended by striking ``2 cents'' and inserting ``4 
cents''.
    (b) Increase in Expenditure Limits for Participating Candidates; 
Elimination of State-Specific Limits.--
            (1) In general.--Section 315(b)(1) of such Act (2 U.S.C. 
        441a(b)(1)) is amended by striking ``in excess of _'' and all 
        that follows and inserting the following: ``in excess of 
        $75,000,000 with respect to a campaign for nomination for 
        election or in excess of $75,000,000 with respect to a campaign 
        for election to such office.''.
            (2) Conforming amendment relating to timing of cost-of-
        living adjustment.--Section 315(c)(2)(B) of such Act (2 U.S.C. 
        441a(c)(2)(B) is amended--
                    (A) in clause (i), by striking ``subsections (b) 
                and (d)'' and inserting ``subsection (d)'';
                    (B) in clause (i), by striking ``and'' at the end;
                    (C) in clause (ii), by striking the period at the 
                end and inserting ``; and''; and
                    (D) by adding at the end the following new clause:
                    ``(iii) for purposes of subsection (b), calendar 
                year 2004.''.
            (3) Other conforming amendments.--The Internal Revenue Code 
        of 1986 is amended--
                    (A) in section 9004(a)(1), by striking ``section 
                320(b)(1)(B) of the Federal Election Campaign Act of 
                1971'' and inserting ``section 315(b)(1) of the Federal 
                Election Campaign Act of 1971''; and
                    (B) by striking ``section 320(b)(1)(A) of the 
                Federal Election Campaign Act of 1971'' each place it 
                appears in sections 9034(b) and 9035(a) and inserting 
                ``section 315(b)(1) of the Federal Election Campaign 
                Act of 1971''.
    (c) Repeal of Exclusion of Fundraising Costs From Treatment as 
Expenditures.--Section 301(9)(B)(vi) of the Federal Election Campaign 
Act of 1971 (2 U.S.C. 431(9)(B)(vi)) is amended by striking ``in excess 
of an amount equal to 20 percent of the expenditure limitation 
applicable to such candidate under section 315(b)'' and inserting the 
following: ``who is seeking nomination for election or election to the 
office of President or Vice President of the United States''.
    (d) Increase in Expenditure Limits for Primary Candidates 
Participating in Primary Payment System Who Face Certain 
Nonparticipating Opponents.--
            (1) In general.--Section 315(b) of the Federal Election 
        Campaign Act of 1971 (2 U.S.C. 441a(b)) is amended--
                    (A) in paragraph (1), by striking ``No candidate'' 
                and inserting ``Except as provided in paragraph (3), no 
                candidate''; and
                    (B) by adding at the end the following new 
                paragraph:
    ``(3)(A) In the case of a candidate described in paragraph (1) in a 
campaign for nomination for election for the office of President who 
faces a nonparticipating primary candidate of the same political party 
who receives contributions or makes expenditures with respect to the 
campaign in an aggregate amount greater than 133 percent of the 
expenditure limitation under paragraph (1), the limitation on 
expenditures applicable under such paragraph shall be increased by 100 
percent.
    ``(B) Each nonparticipating primary candidate who receives 
contributions or makes expenditures with respect to the campaign in an 
aggregate amount greater than 133 percent of the expenditure limitation 
under paragraph (1) shall notify the Commission in writing not later 
than 24 hours after first receiving aggregate contributions or making 
aggregate expenditures in such an amount.
    ``(C) Not later than 24 hours after receiving a written notice from 
a nonparticipating primary candidate under subparagraph (B), the 
Commission shall notify each opponent of the candidate to whom the 
increased limitation on expenditures applies pursuant to subparagraph 
(A).
    ``(D) In this paragraph, a `nonparticipating primary candidate' 
means a candidate for nomination for election for the office of 
President who is not eligible under section 9033 of the Internal 
Revenue Code of 1986 to receive payments from the Secretary of the 
Treasury under chapter 96 of such Code.''.
            (2) No increase permitted in matching payments as a result 
        of increase in expenditure limit.--Section 9034(b) of the 
        Internal Revenue Code of 1986 is amended by striking the period 
        at the end and inserting the following: ``, except that a 
        candidate shall not receive any additional payments under 
        subsection (a) once such candidate has received a combination 
        of payments under subsection (a) and contributions which, in 
        the aggregate, exceed the expenditure limit applicable under 
        section 315(b)(1) of the Act with respect to a campaign for 
        nomination for election to the office of the President 
        (notwithstanding any increase in such expenditure limitation 
        pursuant to section 315(b)(3) of such Act).''.

SEC. 5. REVISIONS TO DESIGNATION OF INCOME TAX PAYMENTS BY INDIVIDUAL 
              TAXPAYERS.

    (a) Increase in Amount Designated.--Section 6096(a) of the Internal 
Revenue Code of 1986 is amended--
            (1) in the first sentence, by striking ``$3'' each place it 
        appears and inserting ``$6''; and
            (2) in the second sentence--
                    (A) by striking ``$6'' and inserting ``$12'', and
                    (B) by striking ``$3'' and inserting ``$6''.
    (b) Indexing.--Section 6096 of such Code is amended by adding at 
the end the following new subsection:
    ``(d) Indexing of Amount Designated.--
            ``(1) In general.--With respect to each taxable year after 
        2004, each amount referred to in subsection (a) shall be 
        increased by the percent difference described in paragraph (2), 
        except that if any such amount after such an increase is not a 
        multiple of $1, such amount shall be rounded to the nearest 
        multiple of $1.
            ``(2) Percent difference described.--The percent difference 
        described in this paragraph with respect to a taxable year is 
        the percent difference determined under section 315(c)(1)(A) of 
        the Federal Election Campaign Act of 1971 with respect to the 
        calendar year during which the taxable year begins, except that 
        the base year involved shall be 2004.''.
    (c) Ensuring Tax Preparation Software Does not Provide Automatic 
Response to Designation Question.--Section 6096 of such Code, as 
amended by subsection (b), is amended by adding at the end the 
following new subsection:
    ``(e) Ensuring Tax Preparation Software Does not Provide Automatic 
Response to Designation Question.--The Secretary shall promulgate 
regulations to ensure that electronic software used in the preparation 
or filing of individual income tax returns does not automatically 
accept or decline a designation of a payment under this section.''.
    (d) Public Information Program on Designation.--Section 6096 of 
such Code, as amended by subsections (b) and (c), is amended by adding 
at the end the following new subsection:
    ``(f) Public Information Program.--
            ``(1) In general.--The Federal Election Commission shall 
        conduct a program to inform and educate the public regarding 
        the purposes of the Presidential Election Campaign Fund, the 
        procedures for the designation of payments under this section, 
        and the effect of such a designation on the income tax 
        liability of taxpayers.
            ``(2) Use of funds for program.--Amounts in the 
        Presidential Election Campaign Fund shall be made available to 
        the Commission to carry out the program under this subsection, 
        except that the amount made available for this purpose may not 
        exceed $10,000,000 with respect to any Presidential election 
        cycle. In this paragraph, a `Presidential election cycle' is 
        the 4-year period beginning with January of the year following 
        a Presidential election.''.

SEC. 6. ADDITIONAL GENERAL ELECTION PAYMENTS TO PARTICIPATING 
              CANDIDATES FACING CERTAIN NONPARTICIPATING OPPONENTS.

    (a) In General.--Section 9004(a)(1) of the Internal Revenue Code of 
1986 is amended--
            (1) by striking ``(1) The eligible candidates'' and 
        inserting ``(1)(A) Except as provided in subparagraph (B), the 
        eligible candidates''; and
            (2) by adding at the end the following new subparagraph:
            ``(B) In addition to the payments described in subparagraph 
        (A), each eligible candidate of a major party in a presidential 
        election with an opponent in the election who is not eligible 
        to receive payments under section 9006 and who receives 
        contributions or makes expenditures with respect to the primary 
        and general elections in an aggregate amount greater than 133 
        percent of the combined expenditure limitations applicable to 
        eligible candidates under section 315(b)(1) of the Federal 
        Election Campaign Act of 1971 shall be entitled to equal 
        payments under section 9006 in an amount equal to 100 percent 
        of the expenditure limitation applicable under such section 
        with respect to a campaign for election to the office of 
        President.''.
    (b) Special Rule for Minor Party Candidates.--Section 9004(a)(2)(A) 
of such Code is amended--
            (1) by striking ``(A) The eligible candidates'' and 
        inserting ``(A)(i) Except as provided in clause (ii), the 
        eligible candidates''; and
            (2) by adding at the end the following new clause:
            ``(ii) In addition to the payments described in clause 
        (ii), each eligible candidate of a minor party in a 
        presidential election with an opponent in the election who is 
        not eligible to receive payments under section 9006 and who 
        receives contributions or makes expenditures with respect to 
        the primary and general elections in an aggregate amount 
        greater than 133 percent of the combined expenditure 
        limitations applicable to eligible candidates under section 
        315(b)(1) of the Federal Election Campaign Act of 1971 shall be 
        entitled to equal payments under section 9006 in an amount 
        equal to 100 percent of the payments to which such candidate is 
        entitled under clause (i).''.
    (c) Process for Determination of Eligibility for Additional 
Payment.--
            (1) In general.--Section 9005 of such Code is amended--
                    (A) by redesignating subsection (b) as subsection 
                (c); and
                    (B) by inserting after subsection (a) the following 
                new subsection:
    ``(b) Special Rules for Certification of Eligibility for Additional 
Payments.--
            ``(1) Reports on expenditures by ineligible candidates.--If 
        a candidate in a presidential election who is not eligible to 
        receive payments under section 9006 receives contributions or 
        makes expenditures with respect to the primary and general 
        elections in an aggregate amount greater than 133 percent of 
        the combined expenditure limitations applicable to eligible 
        candidates under section 315(b)(1) of the Federal Election 
        Campaign Act of 1971, the candidate shall notify the Commission 
        in writing that the candidate has made aggregate expenditures 
        in such an amount not later than 24 hours after first receiving 
        aggregate contributions or making aggregate expenditures in 
        such an amount.
            ``(2) Certification.--Not later than 24 hours after 
        receiving a written notice under paragraph (1), the Commission 
        shall certify to the Secretary of the Treasury for payment to 
        any eligible candidate who is entitled to an additional payment 
        under section 9004(a)(1)(B) or section 9004(a)(2)(A)(ii) that 
        the candidate is entitled to payment in full of the additional 
        payment under such section.''.
            (2) Conforming amendment.--Section 9005(c) of such Code (as 
        redesignated under paragraph (1)(A)) is amended by striking 
        ``subsection (a)'' and inserting ``this section''.
    (d) Exclusion of Additional Payment From Determination of 
Expenditure Limits.--Section 315(b)(2) of the Federal Election Campaign 
Act of 1971 (2 U.S.C. 441a(b)(2)) is amended--
            (1) by striking ``and'' at the end of subparagraph (A);
            (2) by striking the period at the end of subparagraph (B) 
        and inserting ``; and''; and
            (3) by adding at the end the following new subparagraph:
            ``(C) the amount of expenditures made by a candidate shall 
        be reduced by the amount of any additional payment received by 
        the candidate under section 9004(a)(1)(B) of the Internal 
        Revenue Code of 1986.''.

SEC. 7. DETERMINATION OF AMOUNTS IN PRESIDENTIAL ELECTION CAMPAIGN 
              FUND.

    Section 9006(c) of the Internal Revenue Code of 1986 is amended by 
adding at the end the following new sentence: ``In making a 
determination of whether there are insufficient moneys in the fund for 
purposes of the previous sentence, the Secretary shall take into 
account in determining the balance of the fund for a Presidential 
election year the Secretary's best estimate of the amount of moneys 
which will be deposited into the fund during the year, except that the 
amount of the estimate may not exceed the average of the annual amounts 
deposited in the fund during the previous 3 years.''.

SEC. 8. REPEAL OF PRIORITY IN USE OF FUNDS FOR POLITICAL CONVENTIONS.

    (a) In General.--Section 9008(a) of the Internal Revenue Code of 
1986 is amended by striking the period at the end of the second 
sentence and all that follows and inserting the following: ``, except 
that the amount deposited may not exceed the amount available after the 
Secretary determines that amounts for payments under section 9006 and 
section 9037 are available for such payments.''.
    (b) Conforming Amendment.--The second sentence of section 9037(a) 
of such Code is amended by striking ``section 9006(c) and for payments 
under section 9008(b)(3)'' and inserting ``section 9006''.

SEC. 9. EFFECTIVE DATE.

    The amendments made by this Act shall apply with respect to 
elections occurring after January 1, 2005.
                                 <all>
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