LOBBYING DISCLOSURE ACT OF 1995; Congressional Record Vol. 141, No. 120
(Senate - July 24, 1995)

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[Pages S10540-S10562]
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                    LOBBYING DISCLOSURE ACT OF 1995

  The Senate continued with the consideration of the bill.
  Mr. McCONNELL. Mr. President, before the Senator from Wyoming leaves 
the floor, I listened carefully to the explanation of his amendment, 
and I wanted to commend him for what I think is an outstanding 
amendment, a very important contribution to the underlying legislation. 
I fully intend to support him and encourage this effort. I wish to 
thank him for his leadership in this area.
  Mr. SIMPSON. Mr. President, I thank the Senator from Kentucky. No one 
has been more vitally involved in these issues than my friend from 
Kentucky, Senator McConnell. And those are powerfully reliable words. I 
appreciate it very much.
  Mr. McCONNELL. Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Colorado.
  Mr. BROWN. Mr. President, what is the pending business before the 
Senate?
  The PRESIDING OFFICER. Currently the Simpson amendment No. 1839 is 
pending.
  Mr. BROWN. Mr. President, it is not my intention to preclude further 
debate on the Simpson amendment. Obviously, I join him in the hopes 
that it will pass and be accepted. But would the Senator be comfortable 
if I temporarily set it aside and move back to the Brown amendment?
  Mr. President, I ask unanimous consent that we temporarily set aside 
the Simpson amendment.
  The PRESIDING OFFICER. Is there objection? The Chair hears none, and 
it is so ordered.


                           Amendment No. 1838

  Mr. BROWN. Mr. President, are we now considering the Brown amendment?
  The PRESIDING OFFICER. Yes, the Brown amendment is now the pending 
business.
  Mr. BROWN. Mr. President, it is my intention to offer three 
amendments for consideration of the body. The first one, as we have 
spelled out, is the reporting categories; that they are meaningful in 
reporting the value and, as we have already discussed, a current 
limitation of closing the valuation at $1 million could be very 
misleading.
  The second amendment I hope to offer is one that deals with qualified 
blind trusts. Currently, the statutes under which we operate provide 
that a recipient or beneficiary of a qualified blind trust is allowed 
under a qualified blind trust to be advised of the total cash value on 
a periodic basis.
  Our amendment, the second amendment we will offer, simply would make 
it clear that if one is advised of their total cash value, under the 
statutes, of a qualified blind trust, that total cash value--not the 
value of the assets underneath but the total cash value--is disclosed.
  The third amendment is one that will deal with personal residences 
that exceed $1 million. While there may be very few of these--at least 
I do not anticipate there would be very many--there is a tax 
implication which was passed by previous Congresses in regard to 
valuation of a residence. That tax rule that Members are familiar with 
involves financing of a personal residence in excess of $1 million and 
imposes limitations or, to be more precise, limits the deductibility 
for tax purposes. Inasmuch as that tax provision exists and raises 
potential conflict of interest for Members voting who might come under 
that provision, the third amendment would provide for the reporting of 
personal residences in excess of $1 million. 

[[Page S10541]]

  Mr. President, as I understand it, Members are now considering the 
first amendment, which would expand our reporting categories, and it 
would be my intention to allow this to proceed under a voice vote, if 
that is the wish of Members of the Senate, so that we could maximize 
the use of our time.
  I yield the floor, Mr. President. I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BROWN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BROWN. Mr. President, it will be my intention to lay down the 
other amendments that I have referred to. So I rise at this point for 
the purpose of offering an amendment. First, I ask unanimous consent 
that the pending Brown amendment be temporarily set aside.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.


                           Amendment No. 1840

 (Purpose: To amend title I of the Ethics in Government Act of 1978 to 
require the disclosure of the value of any personal residence in excess 
                             of $1,000,000)

  Mr. BROWN. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from Colorado [Mr. Brown] proposes an amendment 
     numbered 1840.

       At the appropriate place, insert the following:

     SEC.   . DISCLOSURE OF THE VALUE OF ANY PERSONAL RESIDENCE IN 
                   EXCESS OF $1,000,000 UNDER THE ETHICS IN 
                   GOVERNMENT ACT OF 1978.

       (a) In General.--Section 102(a) of the Ethics in Government 
     Act of 1978 is amended by adding at the end thereof the 
     following:
       ``(8) The category of value of any property used solely as 
     a personal residence of the reporting individual or the 
     spouse of the individual which exceeds $1,000,000.''.
       (b) Conforming Amendment.--Section 102(d)(1) of the Ethics 
     in Government Act of 1978 is amended by striking ``and (5)'' 
     and inserting ``(5), and (8)''.

  Mr. BROWN. Mr. President, this second amendment is quite 
straightforward, and it was the reason I thought it appropriate to 
allow it to be read in full. What it does is fill a gap in our 
reporting requirements. Since we have specific legislation that 
provides separate tax treatment if someone borrows more than $1 million 
on a personal residence, there is currently an issue before Congress in 
terms of a tax policy where the ownership of a residence in excess of 
$1 million in value presents a potential conflict of interest.
  Thus, this amendment would fill the gap in our current reporting 
requirements. It would allow disclosure of personal residences that are 
in excess of $1 million or, I should say more precisely, it provides 
for that disclosure and would provide information with regard to 
potential conflict of interest when voting on tax issues of that kind.
  Mr. President, I ask unanimous consent that the second Brown 
amendment be temporarily set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1841

 (Purpose: To amend title I of the Ethics in Government Act of 1978 to 
 require an individual filing a financial disclosure form to disclose 
 the total cash value of the interest of the individual in a qualified 
                              blind trust)

  Mr. BROWN. Mr. President, I send an amendment to the desk and ask for 
its immediate consideration.
  The PRESIDING OFFICER. The clerk will report the amendment.
  The assistant legislative clerk read as follows:

       The Senator from Colorado [Mr. Brown] proposes an amendment 
     numbered 1841.

  Mr. BROWN. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place insert the following:

     SEC.   . FINANCIAL DISCLOSURE OF INTEREST IN QUALIFIED BLIND 
                   TRUST.

       (a) In General.--Section 102(a) of the Ethics in Government 
     Act of 1978 is amended by adding at the end thereof the 
     following:
       ``(8) The category of the total cash value of any interest 
     of the reporting individual in a qualified blind trust, 
     unless the trust investment was executed prior to July 24, 
     1995 and precludes the beneficiary from receiving information 
     on the total cash value of any interest in the qualified 
     blind trust.''
       (b) Conforming Amendment.--Section 102(d)(1) of the Ethics 
     in Government Act of 1978 is amended by striking ``and (5)'' 
     and inserting ``(5), and (8)''.
       (c) Effective Date.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendment made by this section shall apply with respect to 
     reports filed under title I of the Ethics in Government Act 
     of 1978 for calendar year 1996 and thereafter.

  Mr. BROWN. Mr. President, Brown amendment No. 1841 deals specifically 
with qualified blind trust. Under the current statutes, we provide an 
exception or an exemption from reporting, and it is done only in an 
area where a trust is involved and where it meets the standards of 
qualified blind trust under law.
  Under the statutes of a qualified blind trust, the beneficiary of 
that trust is allowed to receive certain information. The beneficiary 
is allowed to be advised of the earnings of that trust, which is 
obviously necessary for tax purposes, and also under the law is allowed 
to receive information of the total cash value of that trust and can be 
reported to the beneficiary as often as four times a year under the 
current statute.
  Ironically, though, we have exempted the beneficiary from disclosing 
that information which they are allowed to receive under the terms of 
the qualified blind trust. This amendment merely provides that the 
total cash value be reported, along with the other information in 
someone's disclosure. It does not require disclosure of the assets in 
which the trust is invested. But it does provide that the beneficiary 
of that trust report the information that they receive from the trust; 
that is, the total cash value.
  Mr. President, there is a specific exemption included in the third 
Brown amendment, that is amendment No. 1841. That exemption is this: If 
someone is the beneficiary of a qualified blind trust and that trust 
was executed prior to today and the terms of that trust precludes the 
beneficiary from receiving information on the total cash value, then 
one need not report it.
  So while the statute allows people to receive information on the 
total cash value, it is certainly possible that some Members operate or 
receive benefits under a trust that does not advise them of that total 
cash value. It would be our intention to not push those Members into a 
difficult bind under these circumstances and, thus, we have provided 
this exception; that is, if the terms of the trust do not allow the 
beneficiary to be advised of its total cash value, then the Member 
would be exempt from having to report that information; that is, it 
would not have to report the information that they do not have and 
cannot get under the terms of the qualified trust.
  The change, though, is this: If someone has a qualified blind trust 
and is advised under the terms of that trust the total cash value, then 
they would no longer be exempt from reporting that. It, in effect, puts 
Members on equal footing. It seems to me this fills a very important 
loophole in our current disclosure provisions.
  Mr. President, I ask unanimous consent that we temporarily set aside 
amendment No. 1841 and return to the Brown amendment No. 1838.
  Mr. McCONNELL addressed the Chair.
  The PRESIDING OFFICER. The Senator from Kentucky.
  Mr. McCONNELL. Mr. President, just briefly, I want to commend the 
Senator from Colorado for three excellent amendments that I think fit 
the spirit of the underlying legislation, and I want to commend him for 
presenting them. I fully intend to support them and hope the Senate 
will as well.
  Mr. President, I yield the floor.
  Mr. LEVIN addressed the Chair.
  The PRESIDING OFFICER. The Senator the Michigan.
  Mr. LEVIN. Will the Senator yield for a question on amendment No. 
1841?
  Mr. BROWN. Sure.
  Mr. LEVIN. As I understand the amendment, the categories of total 
cash value of any interest of the reporting individual would be the 
same categories as are provided by law for other assets; is that 
correct?

[[Page S10542]]

  Mr. BROWN. That is correct.
  Mr. LEVIN. So if Brown amendment No. 1838 were adopted, it would be 
the new categories as provided in Brown amendment No. 1838 that would 
be applied to the blind trust situation.
  Mr. BROWN. That is correct.
  Mr. LEVIN. On Brown amendment No. 1840, the one relating to the value 
of a house, is it my understanding that the valuation of the home would 
be done in accordance with one of the various methods of valuation 
which are currently allowed for other assets?
  Mr. BROWN. That is correct, in my understanding. The Senator, I know, 
is well versed in this and may be willing to straighten me out on this, 
but my understanding is you can report historic costs if you do not 
have a firm fix on what the current valuation is.
  Mr. LEVIN. My recollection is, and I am not sure I do have any 
greater knowledge than my friend from Colorado, but my recollection is 
that there are at least three methods of valuation which are allowed 
for real estate. You can take cost--I think there is a depreciation 
factor--historic valuation, there is a tax assessment valuation and 
there are a number of other ways, perhaps. But whatever it is that is 
allowed for real estate under the current requirements would be allowed 
when it comes to the valuation of a home under Brown amendment No. 
1840; is that correct?
  Mr. BROWN. That is correct. I might say that it certainly would not 
be my intention to require in any way an annual appraisal or something 
like that. I think the alternatives that exist in law, at least in my 
view, are more than satisfactory for reasonable disclosure.
  Mr. LEVIN. Mr. President, we are attempting to determine whether or 
not there are Senators that wish to debate any of the three Brown 
amendments, and pending that determination, I ask that the amendments 
either be laid aside so that we can return to some other business, or 
if anybody else wishes to come to the floor to debate the bill or any 
of the amendments which have already been laid aside, that they do so.
  I yield the floor.
  Mr. BROWN. Mr. President, for clarification purposes, I wanted to 
mention for the Record what I think is an important aspect of this. 
Amendment No. 1841, which deals with the qualified blind trust, uses 
the term ``total cash value.'' The reason that we use that term is that 
it is the precise language that the current statute uses; that is, the 
current statutes provide that you can have a trust that qualifies as a 
qualified blind trust and still report to the beneficiary the total 
cash value. So that is the origin of that.
  In contacting the Ethics Committee, we sought to learn what was meant 
by the term ``total cash value.'' We are advised that they do not have 
an independent legal opinion on the use of that term, even though they 
have questions about its usage in filing. But we are also advised that 
they believe that it means and relates to, in effect, the value of the 
trust, market value of the trust, the value it would have if the trust 
were converted to cash on the current market.
  It seems to me that is a reasonable definition, and it is certainly 
with that understanding in mind that we have used that term; that is, 
to give full disclosure to what is the current value under the current 
market conditions of the value of that trust, those trust assets.
  I yield to the distinguished Senator from Michigan.
  Mr. LEVIN. Mr. President, I wonder if the Senator will yield for an 
additional question which relates to line 1 on page 2. It says there, 
``the category of the total cash value of any interest of the reporting 
individual.''
  I want to see if my understanding is correct. Is the cash value of 
interest related purely to the value of the asset? And is my 
understanding correct that this amendment does not require the 
disclosure of income from that asset? Or is that already required under 
law?
  Mr. BROWN. It is my understanding that the law already requires the 
reporting of income accruing to the beneficiary of the trust, but in 
the past has not required the disclosure of the total cash value of the 
underlying assets.
  Mr. LEVIN. So whatever the current law is relative to disclosure of 
income from the qualified blind trust, it is not affected by this 
amendment?
  Mr. BROWN. That is correct.
  Mr. LEVIN. I yield the floor.
  The PRESIDING OFFICER. Who yields time?
  Mr. McCONNELL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. CRAIG. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Abraham). Without objection, it is so 
ordered.


                           Amendment No. 1839

  Mr. CRAIG. Mr. President, last week I introduced legislation on this 
floor to deal with the very topic that the Senator from Wyoming came to 
the floor earlier this afternoon to introduce, an amendment to the 
lobby reform bill that is now pending before the Senate. The issue is 
the Federal Advocacy Reform Act of 1995, and to be able to deal with it 
in the amendment form tied to this is most appropriate.
  For a few moments this afternoon I would like to talk briefly about 
the scope of this amendment and why I think it is so important for us 
to consider in the context of Federal lobbying.
  People are correctly focused on lobbyists and gifts to legislators as 
the Senate convenes today to debate these important topics. But I think 
we also need to worry about Government's gifts to lobbyists. Some of my 
colleagues would say, ``Senator, what are you talking about?'' But the 
Senator from Wyoming, Al Simpson, this afternoon very clearly laid out 
the growing phenomenon in this country of more and more Federal tax 
dollars going in the form of contracts and grants, and in some 
instances outright gifts, to advocacy groups which then allows them to 
use the tax base, the tax dollars of this country, to argue their maybe 
very narrow point of view. The question is, is this in the best 
interests of our country? Should we allow these kinds of things to go 
on?
  It is not a new question that we ask. Mr. President, 75 years ago 
Senators stood on this floor and clearly argued that Federal tax 
dollars should not be used for the purpose of advocacy for a narrow or 
single purpose. But Federal tax dollars should at least be spread for 
the common good and they should be cautiously used, but in all cases 
the common good or the broad base of the American public's interests 
ought to be at mind.
  Over the last good number of years, we have watched grow to a point 
now where over $70 billion annually in the form of grants go out to a 
broad cross-section of interests across this country, and in many 
instances, then, we find those tax dollars right back here on the 
doorstep of the U.S. Capitol, being advocacy dollars for sometimes a 
very narrow, specific point of view.
  I think it is now time for this Senate, as we debate the broader 
question of lobbying, to argue, is that the right thing to do? With 
nearly a $5 trillion debt, a $200 billion deficit, and the very real 
concern that this year for the first time this Congress is going to 
establish increasingly narrow and tighter public priorities as to where 
our dollars get spent, is it not time we do the same in this area and 
with these categories?
  Our associates and friends in the House are approaching it from a 
different point of view. Amendments will be offered before the 
appropriations process over there that will deal with more than the 
501(c)(4) category inside the Internal Revenue Code that the Senator 
from Wyoming and I are discussing this afternoon. They will talk about 
the ``not for profits'' and ``for profits,'' the 501(c)(3)'s and all of 
those that fall under the broad category of section 501 of the IRS 
Code.
  But, today, our amendment is very clear and it is narrow. It says 
that, for those not-for-profit advocacy groups, who choose to be, for 
their purpose, advocating a point of view, that they should be 
disallowed from receiving Federal dollars. It is very straightforward 
and very simple in its approach.
  When I introduced S. 1056 last week, Senator Simpson worked with me 
in the cosponsorship of that, along with my colleague from Idaho, Dirk 
Kempthorne, and Senator Coverdell, Senator Gregg, Senator Nickles, 
Senator Lott, Senator Kyl, Senator 

[[Page S10543]]
Grams, and Senator Faircloth, and it was only but for a few moments on 
Friday that I worked that issue. Obviously it is one of great concern 
and I think very popular, and it ought to be debated here on the floor 
and tied to this important legislation we are dealing with this 
afternoon.
  Mr. President, I ask unanimous consent that a position paper 
developed by the Heritage Foundation be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                     [From the Heritage Foundation]

Restoring Integrity to Government: Ending Taxpayer-Subsidized Lobbying 
                               Activities

       To compel a man to furnish funds for the propagation of 
     ideas he disbelieves and abhors is sinful and tyrannical.--
     Thomas Jefferson.


                              Introduction

       The federal government subsidizes lobbying by tax-exempt 
     and other organizations through grants and contracts to 
     advocacy groups. Each year, the American taxpayers provide 
     more than $39 billion in grants to organizations which may 
     use the money to advance their political agendas.
       Federal funding of private advocacy is not limited by 
     ideological scope. Organizations to the left and right of the 
     political center use taxpayers' funds to promote their ideas 
     and positions. Almost every interest in America--from 
     agriculture to zoology--has one or more organizations 
     receiving government funding. Recipients range from the 
     American Association of Retired Persons, which received over 
     $73 million in a one-year period, to the American Bar 
     Association, which received $2.2 million. Over the past forty 
     years, Congress has helped create a vast patronage network or 
     organizations that enjoy tax-preferred status, receive 
     federal funds, and engage in legislative or political 
     advocacy. The days of big city political machines disbursing 
     patronage may be coming to an end, but the disbursement of 
     financial dividends to political friends is a prominent 
     feature of the federal budget. As Heritage Foundation Senior 
     Fellow Marshall Breger has written:
       ``Lacking the imprimatur of democratic consent, government 
     subsidy of private advocacy can be seen for what it is--the 
     public patronage of selected political beliefs. That these 
     advocacy subsidies are rarely made openly but are often 
     disguised through grants and contracts for legitimate
      public functions merely underscore the dangers inherent in a 
     system of expansive government subsidy.''\1\
     Footnotes at the end of article.
---------------------------------------------------------------------------
       Clearly, the right to petition government to redress 
     grievances should not be infringed. Individuals and 
     organizations using funds from the private sector should be 
     encouraged to engage in the legislative and political 
     process. It is an entirely different matter, however, to 
     employ the coercive power of the federal government to force 
     taxpayers to finance organizations which lobby Congress or 
     other government entities. It is every bit as unjust to force 
     liberal taxpayers to fund organizations on the right as it is 
     to force conservative taxpayers to finance organizations on 
     the left. The fundamental principle is that it should be 
     anathema to force taxpayers to underwrite advocacy with which 
     they disagree.
       Taxpayer funding of advocacy organizations is wrong--
     fiscally, morally, and logically. It is fiscally 
     irresponsible to spend federal revenues on activities that 
     provide no meaningful return to the American people. It is 
     morally wrong for the government to take sides in any public 
     policy debate by assisting the advocacy activities of an 
     elite few. And it is logically wrong for the government to 
     fund activities that often result in lobbying for increased 
     federal expenditures. The reasons are summarized aptly by 
     George Mason University professor James T. Bennett and Loyola 
     College professor Thomas J. DiLorenzo in their comprehensive 
     study, Destroying Democracy.
       ``A large number of individuals with strong views can 
     express their preferences by contributing funds to a group 
     that promotes that issue. With tax-funded politics, however, 
     a small number of zealots with access to the public purse can 
     obtain resources from government to advance its views even 
     though few individuals in society share the group's 
     philosophy. Whenever government funds any political advocacy 
     group, it effectively penalizes those groups that advocate 
     opposing public policies and provides a distinct advantage to 
     the group or groups that it favors in the clash of 
     ideas.''\2\


                         the funding of faction

       The Founding Fathers recognized the dangers of factions in 
     a republic. James Madison wrote in Federalist Number 10 that 
     ``Among the numerous advantages promised by a well-
     constructed Union, none deserves to be more accurately 
     developed than its tendency to break and control the violence 
     of faction.'' Madison defined faction as ``a number of 
     citizens, whether amounting to a majority or minority of the 
     whole, who are united and actuated by some impulse of 
     passion, or of interest, adverce to the rights of other 
     citizens, or to the permanent and aggregate interests of the 
     community.''
       What the Founding Fathers referred to as factions we now 
     call special interests. Instead of restraining factions, 
     however, the federal government today subsidizes them. This 
     distorts the political process by favoring one faction over 
     another and by nourishing
      a network of special interests--a welfare-industrial 
     complex--with a direct self-interest in a growth of the 
     welfare state. The financial cost to the taxpayer is far 
     higher than the amount funneled to these organizations. 
     Each one not only lobbies for its contract or grant, but 
     also advocates for bigger, more expensive social welfare 
     programs, further complicating efforts to put the nation's 
     fiscal house in order. Moreover, while these organizations 
     often claim that the money they receive helps the less 
     fortunate, the reality is that it bolsters their own 
     political power, perks, and prestige.
       The advocacy network and its leaders contribute to what 
     author James Payne has referred to as a ``culture of 
     spending'' in Washington which makes it extremely difficult 
     to trim government programs: ``Leaders of such federally 
     dependent interest groups should not be seen as representing 
     independent citizen opinion. They are quasi-governmental 
     officials with a vested interest in the spending programs 
     that benefit their organizations.''\3\
       Not every dollar given to an advocacy group goes directly 
     to political advocacy activities. However, federal dollars 
     are fungible. Every federal dollar frees private resources to 
     be spent on political, lobbying, and other advocacy 
     activities. Moreover, federal funds make the organization 
     appear to be a larger force in the political arena than it 
     would if it were totally reliant upon private contributions. 
     For example, the National Council of Senior Citizens receives 
     96 percent of its funding from the federal government.
       The NCSC is but one of many advocacy organizations 
     receiving federal funds. Here are just a few other examples:
       The AFL-CIO benefited from more than $2,000,000 between 
     July 1993 and June 1994. According to the AFL-CIO News 
     Online, the AFL-CIO used the Memorial Day recess to increase 
     pressure on Members of Congress with its ``Stand UP'' 
     campaign: ``In those [5 targeted] districts, the AFL-CIO 
     provided radio ads and coordinators to work with local union 
     officials and legislative action committees. Other activity 
     included direct mail, jobsite leafleting, phone call drives 
     using the AFL-CIO's toll-free hotline, petition drives, town 
     meeting attendance, and letters and columns submitted to 
     local newspapers.''\4\
       Recently, the Service Employees International Union 
     produced a newspaper advertisement opposing tax cuts and 
     efforts in Congress to slow the growth of welfare and 
     Medicare. SEIU claims Congress is attempting to ``loot'' 
     welfare programs and ``steal'' from low-income home-energy 
     assistance to help finance ``corporate special interests.'' 
     The ad lamented the impact on Fannie Johnson and her family 
     in Ohio.\5\ This labor special interest benefited from 
     $137,000 in taxpayer funding in 1993 (for an ``anti-
     discrimination public education campaign''). Terminating it 
     would eliminate the tax burden of nearly 30 families just 
     like Ms. Johnson's in Ohio.
       Families USA--a driving force behind the Clinton big-
     government health care plan, including the failed last-ditch 
     attempt to revive it last summer through a nationwide bus 
     tour\6\--received $250,000 from the taxpayers between July 
     1993 and June 1994.
       The Child Welfare League of America received more than 
     $250,000 in federal funding, then turned around and launched 
     an ad campaign to increase welfare spending. The League ran 
     an advertisement opposing the Contract With America's welfare 
     reform bill which charged that ``More children will be 
     killed. More children will be raped.''\7\
       The National Trust for Historic Preservation received 
     approximately $7 million from the federal government in FY 
     1994--22 percent of its budget. In the same year, the Trust 
     ``launched a lobbying campaign against the Disney project'' 
     in Northern Virginia.\8\ In 1993, it ``lobbi[ed] Congress to 
     expand the historic rehabilitation tax credit.''\9\ The 
     group's president, Walter Mondale's former chief of staff 
     Richard Moe, said the full credit would cost ``$1.4 billion 
     over five years.''\10\
       The American Nurses Association received nearly $1 million 
     between July 1993 and June 1994 from the U.S. taxpayers. In 
     1994, the ANA endorsed the Gephardt health care plan and 
     actively lobbied for it. According to the union's own press 
     release announcing this endorsement, ``The American Nurses 
     Association is the only full-service professional 
     organization representing the nation's 2.2 million Registered 
     Nurses through its 53 constituent associations. ANA advances 
     the nursing profession by ... lobbying Congress and 
     regulatory agencies on health care issues affecting nurses 
     and the public.''\11\ The Political Finance and Lobby 
     Reporter revealed on May 12, 1995, that two new ANA lobbyists 
     had registered.
       The American Federation of State, County and Municipal 
     Employees, which received nearly $150,000 in the most recent 
     grant reporting period, denounced the House welfare plan, 
     saying it ``will drive more families into poverty and turns 
     its back on hardworking Americans who fall on bad times. This 
     is the small print in their evil Contract on America.'' 
     AFSCME President Gerald McEntee went on to say that ``AFSCME 
     will continue to fight for real welfare reform that includes 

[[Page S10544]]
     jobs at decent wages, child care, health care and education and 
     training.''\12\
       Actually, however, government funding of advocacy 
     organizations can hurt their cause. Well-grounded public 
     policy institutions prosper from strong grassroots support 
     backed by individual financial contributions. Much like a 
     profitable company, they can measure support by looking at 
     how many people were willing to open their checkbooks for the 
     cause:
       The plain fact is that political advocacy groups will not 
     flourish on the basis of government subsidy. Rather they will 
     prosper only insofar as they develop financial roots in the 
     polity. Reliance on the government trough is no sign of the 
     commitment of your adherents to your cause.\13\


                           Not a New Problem

       Federally funded advocacy is not a new problem. Congress 
     recognized the potential for abuse more than 75 years ago 
     when it passed a law prohibiting the use of federal funds for 
     political advocacy. Unfortunately, the prohibition was too 
     vague, too lenient, and too weakly enforced. Put simply, 
     auditing of federal grants by the government does not provide 
     the level of scrutiny needed to root out abuse.
       The scope of the problem can be seen by examining the 
     Catalog of Federal Domestic Assistance, published every six 
     months by the federal government. It details nearly every 
     federal program from which eligible individuals, 
     organizations, and governments can receive tens of billions 
     of dollars in taxpayer funding.
       For years, congressional offices have worked with 
     constituents to help them find federal grants, in the process 
     becoming very familiar with the Catalog as a guide to 
     sources. But very few congressional staff employees have been 
     aware of abuses in the grants process. These abuses are long-
     standing. In testimony before the House Committee on 
     Government Operations in 1983, Joseph Wright of the Office of 
     Management and Budget noted that the General Accounting 
     Office had found problems as far back as 1948.\14\
       In the early years of the Reagan Administration, the OMB 
     attempted to revise OMB Circular A-122 (originally issued in 
     the final year of the Carter Administration) to redefine 
     limits on ``allowable costs'' by federal grantees. The 
     revision, first released in January 1983, was widely 
     criticized as overly broad, excessively burdensome, and 
     unenforceable.
       One of the focal points of the initial debates was the fact 
     that the original OMB proposal apparently would have 
     disallowed the use of any equipment, personnel, or office 
     space for both federal grant and political advocacy purposes 
     if at least 5 percent of the organization's resources was 
     used for lobbying. For example, a copy machine could not be 
     used to produce flyers for a rally on Capitol Hill if it was 
     paid for--in whole or in part--by taxpayer funds. Many 
     nonprofits objected to such clear separation between federal 
     funding and political advocacy.
       Months later, OMB Director David Stockman and General 
     Counsel Michael Horowitz withdrew the original proposal and 
     released a new draft with a more narrow definition of 
     prohibited activities. This watered-down version no longer 
     drew a clear line between allowable and unallowable costs. 
     Instead, it specified a few examples of prohibited behavior, 
     including a prohibition on reimbursement for conferences used 
     in ``substantial'' part to promote lobbying activities.
       Unfortunately, this effort to appease federally funded 
     nonprofits and quell opposition in Congress was futile. 
     Because Congress signaled its clear opposition to working 
     with the Reagan Administration to curb federally funded 
     lobbying activities, despite the fact that all parties 
     acknowledged such behavior was inappropriate, A-122 failed to 
     improve substantially the restrictions on lobbyists billing 
     Uncle Sam for their activities.


                 existing prohibitions are not working

       Federal law prohibits the use of federal funds for lobbying 
     (18 U.S.C. Section 1913). However, there is no clear set of 
     guidelines as to specific prohibited practices. In addition, 
     numerous appropriations riders have been offered and approved 
     in the past in an effort to curb federally subsidized 
     lobbying. The purpose of the Reagan Administration's attempt 
     to create a more stringent version of OMB Circular A-122 was 
     to tighten the gaping loopholes in existing law and to 
     implement Congress's intent in passing lobbying prohibitions.
       Circular A-122 drew on several distinct concepts to frame 
     the new guidelines.
       Taxpayers are not obliged to fund advocacy they oppose. The 
     Supreme Court in 1977 ruled that taxpayers are not required, 
     directly or indirectly, ``to contribute to the support of an 
     ideological cause [they] may oppose.'' (Abood v. Detroit 
     Board of Education)
       Freedom of speech does not depend on federal funding. In 
     1983, the Supreme Court unanimously ruled that the federal 
     government ``is not required by the First Amendment to 
     subsidize lobbying. . . . We again reject the notion that 
     First Amendment rights are somehow not fully realized unless 
     they are subsidized by the State.'' (Reagan v. Taxation with 
     Representation)
       The Internal Revenue Code does not alleviate the problem. 
     The notice of the request for public comment on the second 
     revision of A-122 notes that current IRS rules threaten tax-
     preferred organizations only if they exceed defined limits on 
     lobbying. However, the limits are not tied in any way to the 
     receipt of federal funds, leading to many of the same 
     problems from which the 1919 law prohibiting federally funded 
     lobbying suffers.
       Unfortunately, the firestorm created by the first proposed 
     revision of A-122 led to a second draft that watered down the 
     tough initial provisions and failed to solve the problems 
     outlined by the Administration in presenting its proposals. 
     The notice of public comment on the second proposal stated 
     that its ``purpose [was] assuring compliance with a myriad of 
     statutory provisions mandating that no federal funds used for 
     lobbying purposes, and to comply, in balanced fashion, with 
     fundamental First Amendment imperatives.'' Despite the best 
     of intentions, the revised A-122 did not meet these goals.
       A particularly serious provision of the second revision was 
     its enforcement mechanism. A popular maxim in the 1980s was 
     ``trust but verify.'' OMB Circular A-122 relied on trust 
     alone:
       ``[T]he federal government will rely upon [the nonprofit 
     employee's] good faith certification of lobbying time below 
     25%. . . . Under the proposal, the absence of time logs or 
     similar records not kept pursuant to grantee or
      contractor discretion will no longer serve as a basis of 
     contesting or disallowing claims for indirect cost 
     employees.''
       In essence, this lack of verification of time spent on 
     lobbying activities permits the individual to state that he 
     is complying with the law even if that is not the case. This 
     is worse than the fox guarding the henhouse. If a nonprofit 
     is willing to violate the restrictions on advocacy, surely it 
     will have no qualms about certifying it is in compliance with 
     the law.


                      tougher restrictions needed

       Tougher laws are needed to prevent the abuse of taxpayers' 
     funds by federal grantees. There is no excuse for compelling 
     John Q. Public to support political advocacy that he opposes. 
     It is fiscally irresponsible and morally indefensible.
       The following should be essential parts of any 
     congressional efforts to curb current abuses:
       Truth in Testimony. Witnesses testifying before Congress 
     should be required to divulge in their oral and written 
     testimonies whether they receive federal funds and, if so, 
     for what purpose and in what amount. This will permit 
     committees to view the testimony in an appropriate light.
       No Federal Funding for Advocacy. No organization that 
     receives federal funds should be permitted engage in any 
     thing but incidental lobbying activities, except on issues 
     directly related to its tax status.
       No Bureaucratic Shell Games. No recipient of federal funds 
     should be permitted to maintain organizational ties to any 
     entity that engages in lobbying activity. All subgrantees 
     should be treated as it they received the funds directly from 
     the federal government. Independent Sector, an organization 
     representing hundreds of nonprofit advocacy groups, 
     unwittingly indicated the need for this in a recent report: 
     ``Although the non-profit organization received a check from 
     the local government, the local government may have received 
     some or all of its funding for this project from a Federal 
     Community Development Block Grant (CDBG).''\15\
       Meaningful Auditing. The Inspectors General of the various 
     federal departments and agencies must investigate more 
     thoroughly any abuses of current law, as well as new laws 
     passed by the Congress.
       Tough Penalties. The consequences for violating the 
     prohibition on federally subsidized lobbying must be 
     sufficient to discourage organizations from violating the 
     standards. Under no circumstances should any organization 
     that willingly and knowingly violates the prohibitions 
     receive further federal funding.
       Representative Robert K. Dornan (R-CA) has introduced H.R. 
     1130, the Integrity in Government Act, which would prohibit a 
     recipient or paid representative of any federal award, grant, 
     or contract from lobbying in the following circumstances:
       In favor of continuing the award, grant, or contract;
       In favor of the actual program under which the funds were 
     disbursed;
       In favor of any other program within the broad department 
     or agency; and
       In favor of continued department or agency funding.
       The Dornan legislation also prohibits tax-exempt lobbying 
     organizations from receiving federal funds. Representatives 
     Bob Ehrlich (R-MD), Ernset Istook (R-OK), and David McIntosh 
     (R-IN) also are working on legislation to remedy this 
     problem.
       It is difficult to craft legislation that satisfactorily 
     defines prohibited activities. More-over, any bill designed 
     to redress these abuses must prevent organizations from 
     simply establishing separate bank accounts and separate 
     names. To be effective, there must be a definite and complete 
     physical separation between all federally and privately 
     funded resources.


                               Conclusion

       Taxpayer-subsidized political advocacy represents pure 
     fiscal folly and moral injustice. No hard-working American 
     should be compelled to finance lobbying activities with which 
     he disagrees. The Founding Fathers would be appalled at 
     current federal grant making. Thirteen years ago, The 
     Washington Post editorialized:
       ``[W]e agree that there is something disturbing about 
     organizations that strongly 

[[Page S10545]]
     advocate positions many sensible people find politically or morally 
     repugnant, acting at the same time as administrators of 
     government programs. It is easy to believe that the advocacy 
     groups' employees will sometimes proselytize the program's 
     beneficiaries in ways we would consider inappropriate (though 
     not unheard of) for a civil servant. Advocacy organizations 
     might also want to ask themselves whether they risk 
     compromising their own purposes by accepting government 
     money, and whether they want to assume the inevitable risk 
     that it might be withdrawn suddenly for legitimate political 
     reasons.''\16\
       Abuse of federal grant funds must be stopped. Tougher 
     restrictions are needed to prevent lobbying organizations 
     from obtaining some or most of their revenue from the 
     American taxpayers. Auditing and investigation of federal 
     grantees by the Executive Branch must be strengthened. 
     However, a danger always exists that as long as government 
     funds go to advocacy organizations, the ``wall of 
     separation'' will be porous. Moreover, the less fortunate 
     would be assisted more directly by eliminating the middleman 
     who ``does well by doing good.''
       Without restoring integrity to government by ending 
     federally funded lobbying, Congress and the President will 
     continue to squander millions of taxpayer dollars each year. 
     Political patronage should have no place in the federal 
     budget.
       Marshall Wittmann, Senior Fellow in Congressional Affairs.
       Charles P. Griffin, Deputy House Liaison.
                               footnotes

     \1\Marshall Breger, ``Halting Taxpayer Subsidy of Partisan 
     Advocacy,'' Heritage Lectures No. 26, 1983, p. 10.
     \2\James T. Bennett and Thomas J. DiLorenzo, Destroying 
     Democracy: How Government Funds Partisan Politics 
     (Washington, D.C.: Cato Institute, 1985), p. 388.
     \3\James Payne, The Culture of Spending (San Francisco: ICS 
     Press, 1991), p. 17.
     \4\AFL-CIO News Online, June 7, 1995, downloaded from the 
     AFL-CIO's Internet site on June 16, 1995.
     \5\Advertisement, ``Fannie Johnson Can't Afford Another 
     Republican Tax Cut,'' The New York Times, June 15, 1995, p. 
     B-11.
     \6\``The $2 million [bus] trip is financed by Families USA, a 
     liberal philanthropy, with unions and other groups.'' 
     Families USA was the ``chief sponsor of the caravans.'' 
     Jennifer Campbell, ``Caravan Met with Mixed Reaction,'' USA 
     Today, July 29, 1994, p. 4A.
     \7\Advertisement, ``First neglect at home, Now abuse by 
     Congress,'' The Washington Times, March 22, 1995, p. A19.
     \8\Editorial, ``The War of the Subsidies,'' The Washington 
     Times, May 6, 1994, p. A22.
     \9\James H. Andrews, ``Historical Trust Uses Its Clout for US 
     Heritage,'' The Christian Science Monitor, May 14, 1993, p. 
     12.
     \10\Charlene Prost, ``Historic Preservation Trust Seeks to 
     Gain New Members,'' St. Louis Post-Dispatch, October 5, 1993, 
     p. 13B.
     \11\PR Newswire, ANA press release, August 11, 1994, obtained 
     from NEXIS.
     \12\PR Newswire, AFSCME press release, March 27, 1995, 
     obtained from NEXIS.
     \13\Marshall Breger, ``Partisan Subsidies: Democracy 
     Undone,'' The Washington Times, December 6, 1983, p. 2C.
     \14\Joseph R. Wright, Jr., testimony in Hearing on Proposed 
     Revisions to OMB Circular A-122, Committee on Government 
     Operations, U.S. House of Representatives, 98th Cong., 1st 
     Sess., March 1, 1983, p. 2.
     \15\See ``Impact of Federal Budget Proposals Upon the 
     Activities of Charitable Organizations and the People They 
     Serve,'' Independent Sector, June 1995, p. 314.
     \16\Editorial, ``Financing the Left,'' The Washington Post, 
     April 26, 1982.
                                appendix

       The following case studies demonstrate the need to reform 
     the federal grants process. The organizations analyzed were 
     selected for illustrative purposes and do not represent the 
     entire universe of the problem.\1\
     \1\The dollar amounts provided are approximate, based on 
     information provided by congressional offices from searches 
     in the Federal Assistance Awards Data System (FAADS) 
     database. All financial data cover the period from June 1993 
     to July 1994, unless otherwise specified. Numbers in 
     parentheses are referenced numbers for programs listed in the 
     Catalog of Federal Domestic Assistance.
---------------------------------------------------------------------------

             American Association of Retired Persons (AARP)

       AARP receives funding for approximately one-quarter of its 
     annual expenditures from the federal government. Sources 
     range from programs for the elderly to millions of dollars 
     annually to provide clerical support to the EPA.

Senior Environmental Employment Program (EPA: 66.508).......$20,000,000
Tax Counseling for the Elderly (IRS: 21.006)..................4,600,000
Sr. Community Service Employment Program (DOL:17.235)........49,000,000
Breast/Cervical Cancer Detection Program (HHS: 93.919)...........75,000
                                                       ________________

      Total..................................................73,675,000
                     American Bar Association (ABA)

       The American Bar Association received $2.2 million in 
     federal grants between July 1993 and June 1994.

Missing Children's Assistance (DOJ: 16.543)..................$1,242,000
Social, Behavioral, and Economic Studies (NSF: 47.075)..........138,000
``Resistance and Rebellion in Black South Africa: 1830-1920''..........
Juvenile Justice and Delinquency Prevention (DOJ: 16.541).......100,000
Nat'l Institute for Juv. Justice and Delinquency Prev. (DOJ: 16.550,000
Justice Research, Development and Evaluation (DOJ: 16.560)......139,000
Drug Control and System Improvement (DOJ: 16.580)...............125,000
Title IV--Aging Programs (HHS: 93.048)..........................200,000
Child Welfare Research and Demonstration (HHS: 93.608)..........125,000
Child Abuse and Neglect Discretionary Activities (HHS: 93.670)...58,000
Disaster Assistance (FEMA: 83.516)...............................30,000
                                                       ________________

      Total...................................................2,207,000
                                AFL-CIO

       The AFL-CIO (and its affiliates) received $10.7 million in 
     federal funding between July 1993 and June 1994. Following is 
     an overview of this organization's federal funding:

Tripartite Construction Training Tech. Xfer (DOL 17.AAA).....$1,119,000
Section 8 Rehabilitation (HUD: 14.856)..........................868,000
Occupational Safety and Health (DOL: 17.500).....................70,000
Targeted Training Program--Logging.....................................

       In addition, the following contracts were awarded to the 
     AFL-CIO Appalachian Council:

DOL/ETA: Vocational-Technical Training.......................$2,670,000
DOL/ETA: Other Ed/Training Services...........................5,974,000
                                                       ________________

      Total..................................................10,701,000
                 Child Welfare League of America (CWLA)

       The Child Welfare League of America received the following 
     grants between July 1993 and June 1994:

Intergenerational Grants (Corporation for National Service: 72.0$58,000
Adoption Opportunities (HHS: 93.652)..............................2,000
Special Programs for the Aging (HHS: 93.048)....................200,000
                                                       ________________

      Total.....................................................260,000
                  Consumer Federation of America (CFA)

       The Consumer Federation of America received more than 
     $600,000 from the EPA. The code assigned to the award was not 
     found in the Catalog.

Radon Projects (EPA: 66.AAC)...................................$610,000
                                                       ________________

      Total.....................................................610,000
                    Environmental Defense Fund (EDF)

       The Environmental Defense Fund benefited from more than 
     $500,000 in taxpayer funding.

Drainage Management System (DOI: 15.BBZ)........................$50,000
Tradable Discharge Permits (EPA: 66.AAC).........................15,000
Air Pollution Control Research (EPA: 66.501).....................90,000
National Recycling Campaign (EPA: 66.AAC).......................360,000
                                                       ________________

      Total.....................................................515,000
                              Families USA

       Families USA received at least $250,000 from the Department 
     of Health and Human Services.

Special Programs for the Aging (HHS: 93.048)...................$250,000
                                                       ________________

      Total.....................................................250,000
                      League of Women Voters (LWV)

       The League of Women Voters benefited primarily from EPA 
     funding for various environmental research projects.

Clean Air Act Policy Development (EPA: 66.AAC).................$100,000
UV Index (EPA: 66.AAC)...........................................21,000
Managing Solid Waste Training (EPA: 66.951)......................39,000
Community Ground-Water Education Project (EPA: 66.AAC...........190,000
Nuclear Waste Primer (DOE: 81.065)..............................261,000
                                                       ________________

      Total.....................................................611,000
               National Council of Senior Citizens (NCSC)

       The NCSC receives 96 percent of its funding from the 
     federal government.

Dislocated Worker Assistance (DOL: 17.246).......................$6,000
Senior Environmental Employment Program (EPA: 66.508).........9,988,000
Section 8 Housing Rehabilitation (HUD: 14.856)..................522,000
Sr. Community Service Employment Program (DOL: 17.235).......61,000,000
                                                       ________________

      Total..................................................71,516,000
                       World Wildlife Fund (WWF)

       The World Wildlife Fund received $2.6 million in federal 
     funding between July 1993 and June 1994. Following is an 
     overview:

 
[[Page S10546]]

Undesignated EPA Grants........................................$618,000
Global Marine Contamination Project (EPA: 66.501)...............450,000

       In addition, 31 federal contracts were awarded to 
     ``Resolve, World Wildlife Fund'' during this same period. 
     These contracts were from the EPA for ``Other Management 
     Support Services'' and totaled $1.5 million.

      Total...................................................2,600,000

  Mr. CRAIG. This paper spells out a broad cross-section of groups in 
this country that receive as much as $2 and $3 million a year in tax 
dollars, under grants, directly to them, to fund a variety of 
activities. Many of those interests engage in direct lobbying here, in 
paid advertising, in every method possible under their right of free 
speech to cause the Congress of the United States to vote in a certain 
way.
  It is time, I believe, that we make it very clear to those groups 
that they have every right to exist and that their right to free speech 
is not infringed upon. But let me suggest that the right of free speech 
is not tied directly to the right to receive a Federal grant so you can 
have free speech. While some may argue that they have the right to do 
certain things--and I would not dispute that--we, as legislators, 
without question have the right to determine where the tax dollar goes. 
That is what I am asking that the Senate decide this afternoon and I 
think that is what the Senator from Wyoming is asking in the amendment 
he has offered, in a very narrow section of the IRS Code, that we say 
that the not-for-profit advocacy groups not be allowed to receive money 
in the Federal form of grant or contract or loan that in any way they 
can use for the purpose of advocacy or for the purpose of lobbying.
  I hope my colleagues will join with the Senator from Wyoming and 
myself and others in the support of this amendment as we incorporate it 
in this important legislation, as we work to clarify the whole concern 
about lobbying in our country, so that the American taxpayer clearly 
understands our relationship with special interests and the right of 
all special interests to come to the Congress of the United States to 
argue their point of view.
  I strongly support that. But I do believe it is important that in 
every way we make it clear and simple to understand how we are 
approached through the public process.
  Mr. President, let me close with this quote from Thomas Jefferson.

       To compel a man to furnish funds for the propagation of 
     ideas he disbelieves and abhors is sinful and tyrannical.

  Even then Thomas Jefferson was recognizing that no person's dollar 
should be used to argue a point of view that he or she disagreed with.
  Mr. President, in closing, I ask for the yeas and nays on the 
Simpson-Craig amendment.
  Mr. LEVIN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The amendment is not before us at this time, 
the Chair informs the Senator.
  The absence of a quorum having been suggested----
  Mr. LEVIN. Mr. President, I withhold that. Is there a vote now which 
has been ordered on the Simpson amendment?
  The PRESIDING OFFICER. That amendment is not before us.
  Mr. LEVIN. Is it the intention of the Senator from Idaho to ask 
unanimous consent that it be in order to ask for the yeas and nays on 
the Simpson amendment.
  Mr. CRAIG. It is, and I would so do.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. LEVIN. Now I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. CRAIG. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER (Mr. Grams). Without objection, it is so 
ordered.
  Mr. CRAIG. Mr. President, I ask unanimous consent that the Simpson 
amendment be in order for the purpose of a second-degree amendment.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.


                Amendment No. 1842 to Amendment No. 1839

   (Purpose: To prohibit certain exempt organizations from receiving 
                            Federal grants)

  Mr. CRAIG. Mr. President, I so send that second-degree amendment to 
the desk.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Idaho [Mr. Craig] proposes an amendment 
     numbered 1842 to amendment No. 1839.

  Mr. CRAIG. Mr. President, I ask unanimous consent that the reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       Strike all after the word ``Sec.'', and insert the 
     following:

       . EXEMPT ORGANIZATIONS.

       An organization described in section 501(c)(4) which 
     engages in lobbying of the Internal Revenue Code of 1996 
     shall not be eligible for the receipt of Federal funds 
     constituting an award, grant, contract, loan, or any other 
     form.

  Mr. CRAIG. Mr. President, the purpose of the second-degree amendment 
is to make clear what, by some people's concern, was not clear, and 
that is what is the intent of the Simpson amendment. We are addressing 
section 501 of the IRS Code and, in particular, the 501(c)(4) not-for-
profit advocacy groups who receive Federal grant money. What we are 
saying and what the second-degree amendment clarifies is the difference 
between their options under this amendment; that is, they could 
continue to hold their 501(c)(4) status and lobby, but they could not 
receive Federal moneys under that status.
  If they chose to want to continue to receive Federal grants, they 
would have the election, under the 501 section of the IRS Code, to 
become a 501(c)(3), and in that category, not only is the definition of 
``lobbying'' very clear, but the method by which they must handle and 
account for their Federal dollars. The IRS is very strict and very 
clear as to the accounting and the management of those dollars so that 
they are not commingled, so they are kept separate, so that the 
organization, without question, divides the use of those dollars, so 
there is not the intent or the ability to use Federal dollars for the 
purpose of lobbying.
  That is, without question, the intent of the Simpson amendment. We 
thought it was important that it be clarified. I believe the second-
degree amendment so clarifies.
  Mr. McCONNELL. Will the Senator from Idaho yield for a question?
  Mr. CRAIG. I will be more than happy to yield for the purpose of a 
question.
  Mr. McCONNELL. So the Senator from Kentucky is correct in assuming 
that the purpose of the Craig second-degree amendment to the Simpson 
amendment is to make it clear that a group currently qualifying under 
501(c)(4) can continue to be a 501(c)(4)----
  Mr. CRAIG. A not-for-profit advocacy group.
  Mr. McCONNELL. And receive Federal grants, but if Federal grants are 
received, that organization will no longer be allowed to lobby.
  Mr. CRAIG. That is correct.
  Mr. McCONNELL. And is the Senator from Kentucky further correct in 
inquiring as follows: If a group currently a 501(c)(4) after the 
adoption of the Simpson amendment, as amended by the Craig amendment, 
concluded that receiving Federal grants was critical to its mission, 
then a logical response to the adoption of this amendment would be to 
consider qualifying as a 501(c)(3); is that correct?
  Mr. CRAIG. That would be correct.
  Mr. McCONNELL. I thank the Senator from Idaho. I think his amendment 
is very useful.
  Mr. SIMPSON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Idaho has the floor.
  Mr. CRAIG. Mr. President, I yield the floor.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. SIMPSON. Mr. President, I want to thank very much Senator 
McConnell for his precise inquiry here, and particularly Senator Larry 
Craig, my colleague from Idaho. There is no intent here to injure the 
groups that are listed under what I use as a pretty active resource, 
the GAO report on selected tax-exempt organizations. It gives a list of 
501(c)(4) organizations. 

[[Page S10547]]

  Mr. President, I ask unanimous consent that that list be printed in 
the Record.
  There being no objection, the list was ordered to be printed in the 
Record, as follows:

              Assets, Revenues and Expenses of the Tax-Exempt Organizations Included in This Study              
                                            [In thousands of dollars]                                           
----------------------------------------------------------------------------------------------------------------
                      Name of organization                            Assets         Revenues        Expenses   
----------------------------------------------------------------------------------------------------------------
Social welfare organizations:                                                                                   
American Association of Retired Persons.........................         330,638         292,264         310,763
AVMED, Inc......................................................          98,346         310,256         288,561
Bank of Sweden Tercentenary Foundation..........................         284,429          20,988          14,371
Blue Care Network of Southeast Michigan.........................         132,446         173,845         158,686
Blue Care Network-Great Lakes...................................          54,598         172,034         169,729
Blue Cross Blue Shield Association..............................         134,320         133,381         131,159
California Vision Service.......................................         143,754         304,224         299,865
Capital District Physician's Health Plan, Inc...................          69,372         164,166         151,289
City of Mesa-Municipal Development Corporation..................          50,152           3,101           2,339
City of Scottsdale Municipal Property Corporation...............         203,588          41,913          15,178
Columbus Multi-School Building Corporation......................          57,291           1,653           3,316
Connecticare....................................................          60,906         190,645         187,197
County of Riverside Asset Leasing Corporation...................         580,280          34,651          29,879
CSDA Finance Corporation........................................         274,390          19,787          19,730
Delta Dental Plan of Michigan, Inc..............................         148,660         401,729         399,206
Delta Dental Plan of New Jersey, Inc............................          67,113         130,564         122,605
Disabled American Veterans......................................         144,832          70,995          68,854
Firemen's Association of the State of New York..................          66,710           9,549           5,610
Firemen's Relief Association of Minnesota.......................          52,968           3,403           1,419
Group Health Association........................................          82,704         251,817         248,624
Henry Ford Health Care Corporation Liability Fund...............          55,565          23,345          21,712
Higher Education Assistance Foundation..........................         216,210         172,588          62,703
Higher Education Loan Program of Kansas, Inc....................         235,523          14,972          10,969
Independent Health Association, Inc.............................          83,935         252,288         244,398
International Olympic Committee.................................         127,121          18,122          22,696
JADER Trust.....................................................         101,133           6,194           4,060
Luso-American Development Foundation............................         130,327          24,890          15,188
Marine Spill Response Corporation...............................         264,818          84,610          72,888
Medcenters Health Care, Inc.....................................         102,899         352,189         349,834
Merrillville Multi-School Building Corporation..................         117,269           3,304           5,773
Midwest Foundation Independent Physicians Association...........         110,063         225,844         213,056
Minneapolis Fire Department Relief Association..................         165,395          15,777          11,714
Minneapolis Police Relief Association...........................         264,282          41,230             967
Minnesota School Boards Association Insurance Trust.............          67,554          42,090          42,056
Mohawk Valley Physician's Health Plan...........................          66,183         178,909         175,637
Municipal Improvement Corporation/Los Angeles...................          69,061        151,037,         158,579
Mutual of America Life Insurance Company........................       5,521,940         746,637         718,746
National Rifle Association of America...........................         111,019         101,781         139,022
New Albany-Floyed County School Building Corporation............          57,932           1,242              51
Physicians Health Plan, Inc.....................................          56,639         178,754         178,352
Regional Airports Improvement Corporation.......................         489,656          38,936          38,936
Sisters of Providence Good Health Plan of Oregon................          58,863         117,663         111,068
The Buffalo Enterprise Development Corporation..................          78,897           2,192           2,926
Trans-Alaska Pipeline Liability Fund............................         327,579          37,746          57,633
Tufts Associated Health Maintenance Organization................          88,902         311,821         300,897
Washington Dental Service.......................................          73,670         191,874         188,824
Labor and agricultural organizations:                                                                           
AFL-CIO.........................................................          77,991          69,037          61,736
Air Line Pilots Association.....................................          97,057          82,143          69,723
Amalgamated Clothing and Textile Workers Union-Rochester Joint                                                  
 Board..........................................................          25,273           3,589           2,053
American Federation of State, County and Municipal Employees....          26,862          77,326          74,497
American Federation of Teachers, AFL-CIO........................          51,073          69,280          63,279
Atlantic Coast District ILA.....................................          26,130           3,275           2,726
Bakery Confectionery and Tobacco Workers International..........          24,178          11,875          12,056
Carrier-ILA Container Freight Station Trust Fund................          33,375          14,544           2,330
Dakota's Areawide IBEW-NECA Pension Fund........................          35,770           3,447           1,295
----------------------------------------------------------------------------------------------------------------

  Mr. SIMPSON. Mr. President, if each of those groups or members of 
those groups contacted their elected representatives, I am sure that 
they would be in shock, indicating that they were going to lose 
something.
  So what has occurred in this colloquy and with the second-degree 
amendment is a very important reiteration of points I made when I spoke 
during the offering of the amendment as to why the amendment is 
important.
  I think it has been clarified, but let us just do it one more time 
and, perhaps, if there are any further questions, I hope those who 
resist the amendment will enter the debate so that we can assure them 
that this amendment, now as second degreed by Senator Craig, does not 
prevent any 501(c)(4) organization from refiling as a 501(c)(3) and 
then accepting that category's limits on lobbying.
  The only circumstance in which they would be cut off from Federal 
funds would be if they chose then to remain entirely under 501(c)(4), 
in effect choosing the unlimited lobbying over the Federal grants.
  Under the second-degree amendment, they now have an additional option 
to stay in 501(c)(4) status without lobbying. So there is no attempt to 
restrict anyone. The 501(c)(4)'s have the ability--I hope you hear 
this--they have the ability to spend millions and millions of dollars 
without restriction. They have no restriction whatsoever. All we are 
saying is that in the language now of the amendment, as amended by the 
second-degree amendment--I am going to read it so it will be right in 
context in this debate, it will now read:

       An organization described in section 501(c)(4) which 
     engages in lobbying . . . shall not be eligible for the 
     receipt of Federal funds constituting an award, grant, 
     contract, loan or any other form.

  That is the intent. It is, I hope, clarified now. And if there are 
those who are not in accord with the amendment, those in opposition, 
Senator Craig and I and others--
  Mr. CRAIG. Will the Senator yield?
  Mr. SIMPSON. Yes, indeed.
  Mr. CRAIG. I want to take this brief moment to thank the Senator from 
Wyoming for his leadership in this area. As I mentioned in my comments, 
this is an issue we have debated now for over 75 years in one form or 
another, on one occasion or another, and the fundamental concern of 
Senators long before us was that Federal tax dollars should never be 
used for the purpose of lobbying;
 that we should never restrict the right of the citizen, or the group, 
or the organization to be an advocate before their Government, but that 
the Government should not be promoting, by the use of those dollars, 
their right, or their role, or their activity as an advocacy group, 
that they could under another category receive Federal dollars and 
perform services so defined by the grant of, or the use of, the Federal 
dollar or contract. But they could not use those or turn those dollars 
for the purpose of advocating what might be a very narrow position and 
not a majority position or a mainstream position of the American 
people.

  The Senator from Wyoming has, in the last good many months, been a 
strong and outspoken leader on this issue; I think rightfully so. I 
think the fact he has brought before the American public that literally 
billions of 

[[Page S10548]]
dollars are now being used for these purposes--and they should not be--
has been well taken. I am pleased that he came forth with the 
amendment. It helps us clarify the use of these dollars, and I think 
the American taxpayer will applaud his effort. I thank him for it.
  Mr. SIMPSON. I appreciate that indeed. That is a reason. There is 
another reason, as I have observed it over the past many months. 
Oftentimes, these groups that obtain Federal funding and support will 
use that money to then lobby the Federal Government for more Federal 
support for their members. In other words, whatever the issue is--it 
may be health care, or whatever it may be--they are using the Federal 
support to then lobby for more Federal support, to get more money from 
the Federal Treasury for whatever issue is paramount on their screen. I 
think that is wrong. I add that.
  Mr. LEVIN. Mr. President, who has the floor?
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. LEVIN. Will the Senator yield for a question?
  Mr. SIMPSON. Indeed, I yield to my friend from Michigan.
  Mr. LEVIN. As I understand the amendment, as amended by the Senator 
from Idaho, it would prevent an organization, such as the Disabled 
American Veterans, that I see on the list here, from receiving any kind 
of a grant from the Federal Government, if they also want to use even 
funds that are from a totally unrelated source for lobby; is that 
correct? In other words, the amendment of the Senator from Wyoming, as 
amended, is not simply restricting the 501(c)(4) organization, such as 
the DAV, from both lobbying and receiving a grant. But what the Senator 
is doing in his amendment, as I understand it, is now telling these 
organizations that if you get a grant from the Federal Government for 
one purpose, even though you are using money from a totally different 
source for lobbying, you may not do both; is that correct?
  Mr. SIMPSON. Mr. President, in response to the Senator from Michigan, 
if I understand the question, what we are saying here is if they get 
anything from the Federal Government in the form of an award, grant, 
contract, loan, or any other form, they can file as a 501(c)(3) 
corporation, nonprofit, or they can stay and continue their work as a 
501(c)(4) corporation, but they cannot lobby.
  Mr. LEVIN. Now, we have asked the members of the Finance Committee, 
or the staff of the Finance Committee that are more familiar with 
(c)(3) and (c)(4) than this Senator--I have not had any dealings with 
this--I am simply trying to obtain information while we are getting a 
reaction from committee members and the staff. I believe there was a 
hearing on this issue, and I think it was in the Judiciary Committee or 
Finance, in the last few months on this issue.
  Mr. SIMPSON. Mr. President, we have had a hearing on the issue of 
501(c)(4)'s that receive money from the Federal Government. In this 
case, it was in the form of grants and awards. We have held a hearing.
  Mr. LEVIN. In the Judiciary Committee?
  Mr. SIMPSON. In the Finance Committee.
  Mr. LEVIN. So we are hoping that the Finance Committee members have 
some feelings about the Simpson amendment, as amended, and that they 
would make those feelings known, because this Senator is not able to 
comment on some of the intricacies--or implications, I should say--of 
the amendment. I want to be real clear on one thing. If a 501(c)(4) 
organization--and I see on this list that they include the Disabled 
American Veterans, International Olympic Committee--if they receive a 
grant from the Federal Government for some purpose totally unrelated to 
lobby, they then may not use funds from some different source, other 
than the Federal Government, to lobby and continue to have their 
501(c)(4) status, is that correct?
  Mr. SIMPSON. That is correct, Mr. President.
  Mr. LEVIN. What all the implications are of that on these 
organizations, I do not know. I assume that an organization that has a 
(c)(4) status, which is allowed to lobby, presumably not using 
Government funds to do so, because I think that would be prohibited 
under current law; nonetheless, that organization would then have to 
make a choice, and I presume one of the choices would be to form 
another (c)(4) organization for the purpose of lobbying--which would be 
allowed to lobby; put it that way--using sources other than 
nongovernmental sources. That would always be a choice.
  Let me ask my friend from Wyoming, who is much more knowledgeable 
about this, under current law, can a 501(c)(4) organization use a 
Federal grant or award for lobbying purposes?
  Mr. SIMPSON. Mr. President, a 501(c)(4) corporation cannot, in that 
sense, use a Federal grant or award for ``lobbying" purposes.
  Mr. LEVIN. That is under current law, is that correct?
  Mr. SIMPSON. Under current law, yes.
  Mr. LEVIN. Well, Mr. President, again, I am not as familiar with the 
implications of this. It would seem to me, however, that if one of 
these organizations wanted to create two 501(c)(4)'s, they could do so 
under the Simpson amendment, as amended, and have one organization 
accept Federal grants for the purposes that the grants are awarded for, 
and its other (c)(4) organization be in business for whatever the 
current business is, including permission to lobby, providing it does 
not use Federal funds for that purpose, as the current law is.
  Mr. SIMPSON. Mr. President, I just add that the problem is this: The 
Government in this situation, then, is subsidizing the activities, the 
benefits provided by the largest of lobbyists, who have this 
extraordinary advantage over all other lobbyists. And there are 25 
different section (c) corporate tax exempts; there are 25 of them--the 
(c)(3)'s, which are familiar to most of us, and the (c)(4), (c)(5), 
(c)(6), and (c)(7), et cetera. It is the subsidization of the 
activities, the benefits provided, because they have the ability to 
spend as much as they wish. They have unlimited ability to inject as 
much money--if I might have the attention of my friend from Michigan, 
who I have the deepest affection and respect for. If we are really 
going to do something about big, big lobbyists, then it seems to me 
that we should direct it at the biggest ones of all, the ones who have 
unlimited ability to lobby. There is not a single restriction on a 
501(c)(4). They can spend themselves into oblivion. I say, let them do 
that if they are going to raise their money from contributions and dues 
and the things that supposedly guide an organization's efforts and 
objectives,
 but not in grants, and on and on, from the Federal Government. That is 
the pitch. I am not directing it at any single institution.

  In my research, I came across these extraordinary things. There are 
some organizations listed on here that you and I probably have never 
heard of, that have millions and millions of dollars involved in 
lobbying. All we are saying is, Look, lobby to your little old heart's 
content. You just keep right on doing it. But if you are going to get 
Government support, then you are going to have to go to 501(c)(3), 
which is truly charitable, for religious, charitable, veterans, 
education, compassion, whatever you have to list. Let them do that. Let 
them go to 501(c)(3).
  You mentioned DAV. There is not a single group here listed in the 
501(c) that could not qualify as having a charitable purpose and meet 
every test of a 501(c)(3).
  Mr. LEVIN. Mr. President, will the Senator yield?
  Would it also not be true an organization such as the DAV could 
create an additional 501(c)(4) which would have as its purpose whatever 
the purposes are of the current 501(c)(4), and be allowed to lobby, 
providing it did not receive Federal grants?
  In other words, there is an additional option. It is not just a 
501(c)(4). The Senator from Wyoming has opened the option to create 
another 501(c)(4) which will receive Federal grants, and the original 
501(c)(4) could continue to lobby.
  That is an additional option which the Senator does not preclude, is 
that not correct?
  Mr. SIMPSON. As I understand the question--I am a bit preoccupied. 
You might ask it again.
  Mr. LEVIN. The Senator does not preclude an opening of an 
organization such as the DAV, creating an additional 501(c)(4) to 
receive those Federal 

[[Page S10549]]
grants, providing that additional organization does not engage in 
lobbying activities?
  Mr. SIMPSON. Mr. President, that would be my understanding. If they 
decided to split into two separate 501(c)(4)'s, they could have one 
organization which could both receive grants and lobby without limit.
  Mr. LEVIN. And the Senator does not in his amendment remove the 
provision in the current law that exempts 501(c)(4)'s from paying 
taxes, even if they engaged in lobbying activities, providing, then, 
they are not eligible for Federal grants or awards?
  Mr. SIMPSON. We are not, Mr. President, involved in anything more 
than the singular amendment, saying that they shall not be eligible for 
the receipt of Federal funds constituting an award, grant, contract, 
loan, or any other form.
  We are not changing the tax-exempt status in that sense, although 
there have been many suggestions in both the hearing and on the floor 
and in discussion as to what to do with these groups. It is felt that 
this would be the most appropriate and understandable approach.
  Mr. LEVIN. Mr. President, I just point out to my dear friend from 
Wyoming that his amendment leaves open many possibilities to these 
organizations. His remarks suggest that somehow or another if they are 
going to engage in lobbying, we will remove the subsidy under this 
amendment.
  In fact, this amendment does not touch their tax-exempt status, if 
they continue to engage in lobbying. And, in fact, this amendment does 
not preclude, as the Senator from Wyoming phrased it, the splitting of 
an organization and the creation of another organization which could do 
the lobbying effort while organization No. 1 receives the Federal 
grants.
  So offhand I do not see that this precludes 501(c)(4) from a number 
of options which it currently has, and therefore I am not in a position 
where I can say that I oppose it, because it seems to me it leaves open 
many options for 501(c)(4).
  Again, I want members of the appropriate committee to take a look at 
this. I would not be able to accept it at this time. As one Senator, I 
have no objection to it, but I do want to weigh the views and members 
of the Finance Committee on this issue.
  I yield the floor.
  The PRESIDING OFFICER. The Senator from Idaho.


                    Amendment No. 1842, as Modified

  Mr. CRAIG. As the maker of the second-degree, let me send a 
correction of that amendment to the desk. It is a clerical correction.
  The PRESIDING OFFICER. The amendment will be so modified.
  Mr. LEVIN. Mr. President, I wonder if the clerk would read now the 
amendment, with the second-degree amendment as modified. I think it is 
still relatively short, and I think it would clarify things for 
everybody if we would read the entire amendment, assuming the second 
degree were adopted as modified.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       Strike all after the word ``Sec.'', and insert the 
     following:

       . EXEMPT ORGANIZATIONS.

       An organization described in section 501(c)(4) of the 
     Internal Revenue Code of 1986 which engages in lobbying shall 
     not be eligible for the receipt of Federal funds constituting 
     an award, grant, contract, loan, or any other form.

  Mr. SIMPSON. Mr. President, the insert was in the previous sentence 
and it is now correct where it appears, appropriately on the second 
line. That is the intent. It is what I read into the Record a moment 
ago.
  Let me just say to my friend from Michigan, ask my friends from 
Kentucky and Idaho, what we are finding is that there are groups in 
America who have tax-exempt status who, in effect, really skirt very 
closely to just truly big business. They are involved in big business.
  I hope that maybe my friend would help in making inquiry of the tax-
exempt status of some of these organizations--not now, but in the 
future--because I intend to propose additional reform, especially in 
this area of unrelated business income tax, called the UBIT 
legislation, taxing sources, income, royalties, and I plan to look at 
whether we should tax royalties, tax commercial insurance income. That 
is tax legislation. That needs to go through finance.
  Here, I am dealing only with grants to lobbyists. That is what this 
is singularly to.
  Mr. LEVIN. Mr. President, I know there are a number of Members that 
have questions about the amendment. Again, I am not able to accept the 
amendment at this time.
  Mr. KYL. Mr. President, unless the Senator from Kentucky has 
something, I would like to speak to this amendment.
  Mr. McCONNELL. If I may briefly indicate that Senator Levin and I 
have reached an agreement on the underlying bill. It is our hope to 
offer that amendment and have it voted on at 6 o'clock. I would like to 
have a chance to explain the compromise well before 6 o'clock, but I 
have no problem giving up the floor at this point.
  Mr. KYL. I plan to take about 3 minutes to speak in favor of this 
amendment. If the Senator would prefer to speak now, or I can go ahead.
  Mr. McCONNELL. I yield the floor.
  Mr. KYL. I, too, hope this amendment can be agreed to. It has been 
pointed out there are ways around it, and that is certainly a 
possibility, should the amendment be adopted.
  But it seems to me that, if we adopt this amendment, we will have 
made a statement that we want people to divide their operations if, in 
fact, that is what they choose to do. They cannot be using the same 
operation, in effect, for both purposes. It is their right to divide 
the operation, to do lobbying with one and to have the 501(c)(3) with 
the other, and that is a possibility. But we would at least be on 
record as expressing our desire that Federal funds should not be used 
for lobbying.
  That is why I support the amendment, and I want to just express a 
couple of other reasons why. It has been pointed out that there is a 
great deal of grant money that has been going to these taxpayer 
subsidized lobbying organizations, or I should say special interest 
organizations who also lobby.
  Mr. President, at least $39 billion in Federal grant money was 
distributed to more than 40,000 organizations in 1990 alone, the last 
year for which I have figures. That is money that Congress supposedly 
appropriated to help address important national needs.
  Some of the organizations are ones that I have had an affiliation 
with.
  The American Bar Association, for example, received $2.2 million in 
Federal grants between July 1993 and June 1994 for such activities as 
missing children's assistance; aging programs; justice research; 
development and evaluation; and child welfare research and 
demonstration.
  The American Association of Retired Persons received about $84.7 
million over the same period for the senior environmental employment 
program and the senior community service employment program.
  The AFL-CIO received $2 million. The National Council of Senior 
Citizens received $71.5 million or about 96 percent of its entire 
budget from the Federal Government.
  The problem, as has been noted, Mr. President, is that once a Federal 
grant reaches the organizations' bank account, it simply frees up 
additional dollars for the groups to spend on lobbying activities. Many 
of the organizations are on Capitol Hill every day, often lobbying for 
more taxpayer money on one program or another. Congress has not only 
been filling the trough, but paying these groups to feed there.
  AARP, for example, has been lobbying strenuously against Medicare 
reform. The American Bar Association staged a protest on Flag Day 
against the proposed constitutional amendment to protect the flag. 
CARE, another organization that receives Federal funds, has been 
lobbying against cuts in foreign aid.
  That is all fine. It is their right. Each one of those groups is 
entitled to its views, but none has the right to use taxpayer dollars 
to underwrite its lobbying activities. The U.S. Supreme Court, in the 
case of Regan versus Taxation with Representation, ruled unanimously in 
1983 that the Federal Government ``is not required by the first 
amendment to subsidize lobbying.'' The Court went on to say, ``we again 
reject the notion that first 

[[Page S10550]]
amendment rights are somehow not fully realized unless they are 
subsidized by the State.''
  Thomas Jefferson said it best 200 years ago: ``to compel a man to 
furnish funds for the propagation of ideas he disbelieves and abhors is 
sinful and tyrannical.''
  The amendment directly prohibits any recipient of a Federal grant 
from spending those grant funds on political advocacy. I think we can 
all agree that is appropriate. And because money is fungible, it also 
sets limits on the amount of political advocacy that a grantee can 
perform with nongrant funds.
  This amendment is not about free speech, or the right of any 
organization to petition the Government. Everyone is free to say what 
he wants. Every group is entitled to express its views to Government 
officials. What these groups are not entitled to is a subsidy from 
taxpayers to do that.
  No American should be taxed to advance the political agenda of an 
organization that he or she may have no wish to support or one that 
advocates an agenda he strongly opposes. Subsidies for political 
advocacy are wrong.
  There is another issue besides lobbying at stake here. When a group 
asks for Federal funds to conduct a certain activity--whether it is the 
YMCA to serve the needs of our Nation's youth, the World Wildlife Fund 
to protect the environment, or the National Council of Senior Citizens 
to help older Americans--we should expect that the group puts the funds 
to the intended use. When dollars are commingled and spent in lobbying, 
it is the every people we want to help that are hurt most. Every dollar 
that an organization pays a lobbyist is a dollar that could have been 
used to help a hungry child, someone who is homeless, or in need.
  If an organization would rather lobby the Government than serve the 
needs of the people, it should be frank about, it, refuse Federal 
funds, and go on about its business. We can find another organization 
that will devote the resources toward the intended purpose.
  Mr. President, cutting aid to lobbyists should be the easiest cut we 
make in Federal spending. We should certainly eliminate it before 
considering any reductions in aid to the people these lobbyists purport 
to represent--children, the elderly, the needy, and the environment, to 
name just a few. It is time to cut off Federal funding for political 
advocacy by select groups.
  It's time to let special interests raise their own funds to promote 
their points of view.
  This amendment will do that, if not totally, 100 percent, at least in 
a way that sends the message that Congress wants to send on this 
important issue.
  The PRESIDING OFFICER. The Senator from Kentucky.
  Mr. McCONNELL. Mr. President, I am pleased to indicate that Senator 
Levin and I have reached an agreement on the underlying bill which he 
will be sending to the desk shortly. We had hoped to have a vote on 
this Levin-McConnell compromise at 6 o'clock, but there are some 
problems on this side with regard to getting a vote at 6. But we 
thought we would go ahead and describe for our colleagues the agreement 
that has been reached and at the earliest opportunity, it would be the 
intention of Senator Levin and my intention to get a rollcall vote on 
this compromise.
  Let me say first, in the category of the definition of a lobbyist, 
the original bill by my friend from Michigan required that 10 percent 
of the time spent lobbying made one a lobbyist for purposes of the 
legislation. The alternative that I had earlier offered said that you 
must spend 25 percent of your time in order to meet that threshold. The 
compromise that we have reached is 20 percent. I think it is a 
reasonable compromise, and allows us to sign off in the definition of 
lobbyist section. And the rationale is clear, that to qualify as a 
lobbyist, the individual is to have to spend more than just a casual 
amount of time lobbying.
  Second, in the area of thresholds which would trigger registration 
requirements, the original Levin bill said that $2,500 in income 
received by a lobbying firm or $5,000 spent by an organization which 
lobbies--$2,500 for a firm; $5,000 for an organization--would trigger 
the requirements. What the Senator from Michigan and I have agreed to 
is that, with regard to lobbying firms, $5,000 would trigger coverage; 
and with regard to organizations, $20,000 in expenditures by an 
organization which lobbies.
  Here again, the rationale is that those who do not have a regular, 
ongoing presence in Washington should not be required to register. My 
hope here, which my friend from Michigan has agreed to in this 
compromise, is to not bring under the bill those folks back home who 
may come up here occasionally but who are not in any real sense 
lobbyists.
  Third, in the grassroots area, the issue that bogged us down last 
fall in passing this legislation last year, the original bill of my 
friend from Michigan contained a reference to grassroots activity. The 
compromise deletes all references to grassroots activity and no longer 
makes any suggestion that any grassroots testimony would trigger 
registration. This bill will not require any reporting or disclosure 
whatsoever of grassroots activity.
  Obviously, the goal here that the Senator from Michigan and I have is 
not to discourage genuine grassroots activism out in America to convey 
to us the opinions of those groups on any legislation that we may be 
considering.
  Fourth, in the area of administration and enforcement, Senator 
Levin's original bill created a new Federal agency with the 
responsibility of enforcement. This bill now will create no new 
Government agency. The Secretary of the Senate and the Clerk of the 
House would receive reporting and disclosure forms. I think clearly 
that is a step in the right direction. I want to thank my friend from 
Michigan for that compromise. We do not believe creating additional 
Government agencies is a good idea, particularly in this atmosphere of 
$5 trillion in cumulative Federal debt.
  Finally, with regard to coverage of the executive branch lobbying, 
the compromise of the Senator from Michigan and myself will cover those 
contacts within the executive branch but only contacts made by 
political appointees; that is, schedule C's and above; Presidential 
appointees which require confirmation by the Senate and schedule C's.
  So we have had a very good effort here to reach this agreement. I 
want to thank my friend from Michigan for his willingness to come 
together here in a proposal that I think, clearly, Senators on both 
sides of the aisle ought to feel comfortable in supporting. And it is 
my hope that at some point, preferably early this evening, we might be 
able to get a vote on this.
  I see my friend from Michigan on his feet. I will be glad to yield 
the floor.
  Mr. LEVIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. LEVIN. Mr. President, while both the Senator from Maine and the 
Senator from Kentucky are here, let me first say that the changes that 
we are going to be sending to the desk are important ones but not as 
significant as the changes in the original Levin-Cohen bill which we 
have before us. I am going to try to see if I cannot state what the 
differences are so that there is no confusion when people come to vote.
  For instance, in the bill before us, the so-called Levin-Cohen, et 
cetera, bill, there is no new agency created. That point which Senator 
McConnell just made reference to was already addressed in the 
underlying bill. So there is no change in that regard in terms of the 
amendment which I will be sending to the desk, which will be called the 
Levin-McConnell amendment. There was no new agency created in Levin-
Cohen. There is no change in that in terms of the so-called Levin-
McConnell amendment.
  One of the areas of contention here is whether or not the executive 
branch should be covered. It was the determination of Senator Cohen and 
me and others that lobbying activities include the executive branch. We 
have had hearings in our subcommittee relative to the executive branch. 
We had hearings into Wedtech, for instance, where the executive branch 
was lobbied heavily by outsiders and contracts were obtained for a 
company that never should have gotten contracts and which cost the 
Treasury millions of dollars. That lobbying activity was never 
disclosed because executive branch lobbying was not covered by the 
existing law.
  Executive branch lobbying is covered in the Levin-Cohen bill. It is 
going to 

[[Page S10551]]
continue to be covered if the so-called Levin-McConnell amendment to 
Levin-Cohen is adopted. But what will not be covered, however, will be 
lobbying activities of employees of the executive branch below the 
political appointee level. We are not going to get to lower level 
employee lobbying. We are going to focus on where the lobbying really 
has an impact, which is at the higher levels of the executive branch, 
including the schedule C's.
  So the key issue, however, is that the principle that we are going to 
include executive branch lobbying for the first time has been 
preserved. That principle was embedded in the underlying Levin-Cohen 
bill. It is retained even if we adopt the so-called Levin-McConnell 
amendment to Levin-Cohen, but we will just be excluding lobbying 
activities with certain lower level executive branch employees.
  Next, we tried to make clear in Levin-Cohen that there was no intent 
to cover the lobbying activities of people at the grassroots. The only 
reference to grassroots in Levin-Cohen was where a registered lobbyist 
hired somebody else to stimulate grassroots activity. But then those 
expenses would have to be included in the expenses that would be 
disclosed by the person who is already required to register. That was 
the sole reference.
  There was objection to even that. It did not tell us much, in any 
event, because it was not identified as being a separate expenditure to 
stimulate grassroots lobbying. And we decided to avoid any suggestion, 
even though there was none, to make sure that none could even be made 
that there is any coverage of grassroots lobbying. We have removed that 
provision that would have told us very, very little, in any event, 
since it would not identify that the expenditure was to stimulate 
grassroots lobbying, but simply would have included that amount in the 
total expenditure of somebody who is already required to register.
  But again, I think we wanted to make sure that nobody could argue, 
rightly or wrongly, that we were covering grassroots lobbying. So we 
have agreed to delete even the inclusion of that expenditure that 
someone who is already required to register would have had to have 
included in their disclosure form. So that is a minor change. But it is 
one that we gladly accepted.
  As far as the threshold is concerned, we have retained the threshold 
for firms that lobby, and at $5,000. That threshold that is in Levin-
Cohen is retained at $5,000. The change that has been made is for the 
small organizations that lobby themselves, not by hiring a firm but 
that lobby themselves. In Levin-Cohen, the threshold for that was 
$10,000. In the McConnell substitute, the threshold was $50,000. And 
the agreement that we have reached is to go from $10,000 to $20,000 for 
those organizations that lobby themselves. So just for clarification, 
Levin-Cohen said the threshold was $10,000. McConnell was $50,000, and 
we have gone to $20,000.
  I think that the Senator from Kentucky has covered a number of the 
other questions. I will not add to that except that I think he has 
covered this. But in case he has not, we are simplifying disclosure 
requirements by eliminating the requirement to disclose the specific 
committees that are contacted, and we are clarifying the requirement to 
disclose lobbying on specific executive branch actions. We also are 
making clear that the Clerk of the House and the Secretary of the 
Senate will handle all administrative tasks, including providing 
guidance for the public. I think it was our intention that the Clerk of 
the House and Secretary of the Senate do that. But there apparently was 
some ambiguity about it. And the Senator from Kentucky and I have 
agreed that we would make that very clear explicitly in this amendment 
that we will be sending shortly to the desk to the underlying Levin-
Cohen bill.
  So I want to thank again my friends from Maine and Kentucky for 
working on the underlying bill and working for the amendment to that 
underlying bill. I think we have a very strong lobbying disclosure bill 
that closes the loophole--no more lawyers' loopholes--which allowed 
lawyers to be exempted from lobbying disclosure requirements. No more 
loopholes for those who did not spend all of their time lobbying 
Members of Congress since just about nobody spends all their time 
personally lobbying Members personally. They spend a lot of time with 
staff and a lot of time in preparation.
  We have eliminated every loophole we could get our hands on, and it 
is a strong lobbying bill that has also streamlined and simplified this 
process. I hope we can keep this bill in its strong form and that it 
will not be diluted in any way, because, finally, we will be doing what 
50 years ago Congress thought they were doing, which is to require that 
professional lobbyists, persons who were paid to lobby, disclose to the 
public who is paying them, how much, on what issue. And the important 
add on to that original intent is that now we are going to cover the 
executive branch. And that is a critically important addition because 
so much lobbying activity in this town is both aimed at the executive 
branch and aimed at Congress urging Members of Congress to weigh in 
with the executive branch.
  One of the difficulties with the original McConnell substitute is 
that it had language in it which suggested that it was not covering 
lobbying activities which were aimed at getting us in the Congress to 
lobby Members for the executive branch.
  The underlying Levin-Cohen bill and the Levin-McConnell substitute to 
Levin-Cohen are absolutely clear that lobbying activities of both the 
executive branch and of Congress to get us to weigh in with the 
executive branch are covered lobbying activities.
  Again, let me close with thanks to my colleagues on both sides of the 
aisle. We have had tremendous support here from Senator Daschle, and 
Senator Glenn, as ranking member of Governmental Affairs, has been 
absolutely steadfast in his support for these reforms, as have so many 
other of my colleagues on Governmental Affairs. But I particularly want 
to take off my hat to Senator Cohen who, whether he was the ranking 
member of the subcommittee we are on or the chairman of that 
subcommittee, has been constant in his determination that we are going 
to finally close the loopholes and get paid lobbyists to tell us and 
tell the public who is paying them how much to lobby Congress and the 
executive branch and on what issues.
  With that, I yield the floor.
  Mr. COHEN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Maine.
  Mr. COHEN. Mr. President, let me take just a moment to thank my 
colleague from Michigan and also my colleague from Kentucky. I think 
the substitute language they have agreed to will make an improvement on 
the underlying amendment we offered to the legislation earlier today. 
For simplicity's sake, we might call it the Levin-McCohen bill. That 
would perhaps clarify the fact that Levin-McConnell is amending the 
Levin-Cohen amendment and perhaps eliminate some of the confusion 
surrounding that.
  The changes which have been agreed upon I think do improve the 
amendment in the sense that it makes it clearer; that it also will 
achieve what I believe to be an overwhelmingly bipartisan vote for the 
measure. It has been a long time in the making.
  I take this opportunity to thank Senator Levin for his steadfastness 
in pursuing lobby disclosure reform over the years we have worked 
together.
  I yield the floor.
  Mr. McCONNELL. Mr. President, just for the information of our 
colleagues, there is now a great likelihood we will be able to have a 
vote at 6 on the Levin-McConnell compromise, and even though I do not 
have the unanimous-consent agreement in front of me to read yet, there 
is an excellent chance we will have a recorded vote very shortly.
  Mr. LOTT. Will the Senator yield----
  Mr. McCONNELL. I yield the floor.
  Mr. LOTT. Just so that I might comment?
  I know there are a number of issues pending out there, a lot of 
discussion is still underway on the McCain amendment with regard to 
Ramspeck. I understand they are very close to some agreement on that, 
so we hope maybe we can dispense with that on a voice vote.
  We are continuing to work on both sides on the language in the Brown 
amendments and hopefully something will be worked out on two of those. 

[[Page S10552]]

  We would like to have a vote--I believe we already have the yeas and 
nays ordered--on the Craig substitute to the Simpson amendment. So I 
believe we could have a vote on that at 6 o'clock. And then the 
agreement on Levin-McConnell. So we would be able to move forward with 
a recorded vote on two at 6 o'clock, and I believe we can work out 
several of these other issues on a voice vote. If we find out later we 
cannot, we can always have a recorded vote on those if negotiations do 
not work out. So I believe we would be ready to ask for unanimous 
consent shortly with the idea of getting a vote at 6.
  Mr. LEVIN. If the Senator will yield on that question.
  Mr. LOTT. I will be happy to yield.
  Mr. LEVIN. Mr. President, as I understand it, the yeas and nays have 
been ordered on the underlying Simpson amendment.
  Mr. LOTT. I believe that is the amendment offered by the Senator from 
Idaho [Mr. Craig].
  Mr. LEVIN. My understanding was it was on the Simpson amendment, but 
that does not make any difference. I do not know that the yeas and nays 
are needed on the second-degree amendment. I think they may be needed, 
however, on the underlying amendment.
  Mr. LOTT. Right. That is what we would hope to get in our unanimous-
consent agreement.
  Mr. LEVIN. Then I hope this amendment, the Levin-McConnell amendment, 
the rollcall on that, if necessary, will come immediately following. Is 
that the intention of the Senator from Mississippi?
  Mr. LOTT. I believe that would be appropriate. We could do it either 
way. But I think in view of the fact----
  Mr. LEVIN. May I suggest that the vote on the Levin-McConnell 
amendment come first, to give people a little more opportunity to focus 
on what is in the underlying Simpson amendment, and I think we are 
ready to have a vote on the Levin-McConnell amendment, which, by the 
way, has not been sent to the desk.
  If the Senator will yield further, I wonder if he would permit me now 
to send the so-called Levin-McConnell amendment to the desk.
  Mr. LOTT. Mr. President, I would yield for that purpose so that the 
Levin-McConnell amendment can be sent to the desk. Just very briefly, I 
want to emphasize that this once again is evidence of the substantial 
progress that has been made by the distinguished Senator from Michigan 
and the distinguished Senator from Kentucky. A lot of details have been 
worked out. I hope the Members will have an opportunity to take a look 
at this agreement. I believe it is the basis for concluding this lobby 
reform legislation very shortly.


                Amendment No. 1843 to Amendment No. 1836

  The PRESIDING OFFICER. Without objection, the pending amendments are 
set aside. The clerk will report the amendment submitted by the Senator 
from Michigan.
  The assistant legislative clerk read as follows:

       The Senator from Michigan [Mr. Levin], for himself and Mr. 
     McConnell, proposes an amendment numbered 1843 to amendment 
     No. 1836.

  Mr. LEVIN. Mr. President, I ask unanimous consent that reading of the 
amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       Strike the text of the amendment and insert the following 
     in lieu thereof:
       On page 3, line 20, strike paragraph (E) and redesignate 
     the following paragraphs accordingly.
       On page 5, line 9, strike paragraphs (5) and renumber 
     accordingly.
       On page 6, line 5, strike ``Lobbying activities also 
     include efforts to stimulate grassroots lobbying'' and all 
     that follows through the end of the paragraph.
       On page 7, line 10, strike line 10 through 21 and insert in 
     lieu thereof ``cense); or''
       On page 8, line 11, strike ``that is widely distributed to 
     the public'' and insert ``that is distributed and made 
     available to the public''.
       On page 9, line 11, strike ``a written request'' and insert 
     ``an oral or written request''.
       On page 13, line 15, strike ``1 or more lobbying contacts'' 
     and insert ``more than one lobbying contact''.
       On page 13, line 17 and 18, strike ``10 percent of the time 
     engaged in the services provided by such individual to that 
     client'' and insert ``20 percent of the time engaged in the 
     services provided by such individual to that client over a 
     six month period''.
       On page 16, line 3, strike ``30 days'' and insert ``45 
     days''.
       On page 16, line 8, strike ``the Office of Lobbying 
     Registration and Public Disclosure'' and insert ``the 
     Secretary of the Senate and the Clerk of the House of 
     Representatives''.
       On page 16, line 23, strike ``$2,500'' and insert 
     ``$5,000''.
       On page 17, line 2, strike ``$5,000'' and insert 
     ``$20,000''.
       On page 17, line 22, strike ``shall be in such form as the 
     Director shall prescribe by regulation and''.
       On page 18, line 10, strike ``$5,000'' and insert 
     ``$10,000''.
       On page 18, line 14, strike paragraph (B) and insert in 
     lieu thereof the following:
       ``(B) in whole or in major part plans, supervises, or 
     controls such lobbying activities.''
       On page 18, line 19, strike ``$5,000'' and insert 
     ``$10,000''.
       On page 20, line 18, strike ``the Director'' and insert 
     ``the Secretary of the Senate and the Clerk of the House of 
     Representatives''.
       On page 20, line 21, strike ``30 days'' and insert ``45 
     days''.
       On page 21, line 1, strike ``the Office of Lobbying 
     Registration and Public Disclosure'' and insert ``the 
     Secretary of the Senate and the Clerk of the House of 
     Representatives''.
       On page 21, line 5, strike paragraph (2).
       On page 22, line 5, strike ``shall be in such form as the 
     Director shall prescribe by regulation and''.
       On page 22, line 18, strike ``regulatory actions'' and all 
     that follows through the end of line 20 and insert in lieu 
     thereof ``executive branch actions''.
       On page 22, line 21, strike ``and committees''.
       On page 23, line 20, strike subsection (c) and insert in 
     lieu thereof the following:
       ``(c) Estimates of Income or Expenses.--For purposes of 
     this section, estimates of income or expenses shall be made 
     as follows:
       ``(1) Estimates of amounts in excess of $10,000 shall be 
     rounded to the nearest $20,000.
       ``(2) In the event income or expenses do not exceed 
     $10,000, the registrant shall include a statement that income 
     or expenses totaled less than $10,000 for the reporting 
     period.
       ``(3) A registrant that reports lobbying expenditures 
     pursuant to section 6033(b)(8) of the Internal Revenue Code 
     of 1986 may satisfy the requirement to report income or 
     expenses by filing with the Secretary of the Senate and the 
     Clerk of the House of Representatives a copy of the form 
     filed in accordance with section 6033(b)(8).''
       On page 24, line 23, strike subsection (d).
       On page 25, line 24, strike subsection (e).
       On page 31, strike line 1 and all that follows through line 
     17 on page 47, and insert in lieu thereof the following:

     ``SEC. 7. DISCLOSURE AND ENFORCEMENT.

       ``The Secretary of the Senate and the Clerk of the House of 
     Representatives shall--
       ``(1) provide guidance and assistance on the registration 
     and reporting requirements of this Act and develop common 
     standards, rules, and procedures for compliance with this 
     Act;
       ``(2) review, and, where necessary, verify and inquire to 
     ensure the accuracy, completeness, and timeliness of 
     registration and reports;
       ``(3) develop filing, coding, and cross-indexing systems to 
     carry out the purpose of this Act, including--
       ``(A) a publicly available list of all registered lobbyists 
     and their clients; and
       ``(B) computerized systems designed to minimize the burden 
     of filing and minimize public access to materials filed under 
     this Act;
       ``(4) make available for public inspection and copying at 
     reasonable times the registrations and reports filed under 
     this Act;
       ``(5) retain registrations for a period of at least 6 years 
     after they are terminated and reports for a period of at 
     least 6 years after they are filed;
       ``(6) compile and summarize, with respect to each 
     semiannual period, the information contained in registrations 
     and reports filed with respect to such period in a clear and 
     complete manner;
       ``(7) notify any lobbyist or lobbying firm in writing that 
     may be in noncompliance with this Act; and
       ``(8) notify the United States Attorney for the District of 
     Columbia that a lobbyist or lobbying firm may be in 
     noncompliance with this Act, if the registrant has been 
     notified in writing and has failed to provide an appropriate 
     response within 60 days after notice was given under 
     paragraph (6).

     ``SEC. 7. PENALTIES.

       ``Whoever knowingly fails to--
       ``(1) remedy a defective filing within 60 days after notice 
     of such a defect by the Secretary of the Senate or the Clerk 
     of the House of Representatives; or
       ``(2) comply with any other provision of this Act; shall, 
     upon proof of such knowing violation by a preponderance of 
     the evidence, be subject to a civil fine of not more than 
     $50,000, depending on the extent and gravity of the 
     violation.''
       On page 48, line, strike ``the Director or''.
       On page 48, line 9, strike ``the Director'' and insert 
     ``the Secretary of the Senate or the Clerk of the House of 
     Representatives''.
       On page 54, line 9, strike Section 18 and renumber 
     accordingly.
       On page 55, line 23, strike Section 20 and renumber 
     accordingly.

[[Page S10553]]

       On page 58, line 5, strike ``the Director'' and insert 
     ``the Secretary of the Senate and the Clerk of the House of 
     Representatives''.
       On page 59, strike line 3 and all that follows through the 
     end of the bill, and insert in lieu thereof the following:

     ``SEC. 22. EFFECTIVE DATES.

       ``(a) Except as otherwise provided in this section, this 
     Act and the amendments made by this Act shall take effect on 
     January 1, 1996.
       ``(b) The repeals and amendments made under sections 13, 
     14, 15, and 16 shall take effect as provided under subsection 
     (a), except that such repeals and amendments--
       ``(1) shall not affect any proceeding or suit commenced 
     before the effective date under subsection (a), and in all 
     such proceedings or suits, proceedings shall be had, appeals 
     taken, and judgments rendered in the same manner and with the 
     same effect as if this Act had not been enacted; and
       ``(2) shall not affect the requirements of Federal agencies 
     to compile, publish, and retain information filed or received 
     before the effective date of such repeals and amendments.''

  Mr. LEVIN. Mr. President, I note the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                      Unanimous-Consent Agreement

  Mr. McCONNELL. Mr. President, I ask unanimous consent that Senator 
Levin be recognized to offer an amendment to the Levin-Cohen amendment 
No. 1836, and a vote occur on the amendment at 6 p.m. this evening; and 
that no amendments be in order to the Levin amendment.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, I further ask unanimous consent that 
immediately following the vote on the Levin-McConnell amendment, the 
Senate proceed to the adoption of the Levin-Cohen amendment, as 
amended, if amended, without any intervening action or debate.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. CRAIG. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                Amendment No. 1842, As Further Modified

  Mr. CRAIG. Mr. President, I call up amendment No. 1842 for further 
modification of the second-degree amendment.
  The PRESIDING OFFICER. That will be the pending business.
  Mr. CRAIG. I send the modification to the desk and ask that it be so 
modified.
  The PRESIDING OFFICER. The Senator has a right to modify the 
amendment.
  Mr. CRAIG. I thank the President.
  Mr. LEVIN addressed the Chair.
  Mr. LEVIN. Mr. President, may I suggest the clerk read the amendment 
now as it is modified again. It is a short amendment and it does make a 
difference, and if there is a change in it, everybody should hear what 
that change is. This is an additional modification. I ask that the 
clerk read this amendment. This is an amendment to the Craig 
substitute, as I understand.
  Mr. CRAIG. If the Senator from Michigan will yield, I changed and 
added the word ``activities'' to ``lobbying.'' I think the Senator has 
made an important point, and I wish the full amendment, as modified, to 
be read into the Record.
  The PRESIDING OFFICER. The clerk will read the amendment, as 
modified.
  The assistant legislative clerk read as follows:
       Strike all after the word ``Sec.'', and insert the 
     following:

       . EXEMPT ORGANIZATIONS.

       An organization described in section 501(c)(4) of the 
     Internal Revenue Code of 1986 which engages in lobbying 
     activities shall not be eligible for the receipt of Federal 
     funds constituting an award, grant, contract, loan, or any 
     other form.

  Mr. CRAIG. I thank the Senator from Michigan for making that 
clarifying point. Recognizing that, I yield the floor and suggest the 
absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BROWN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. BROWN. Mr. President, what is the pending business before the 
Senate?
  The PRESIDING OFFICER. The pending business is amendment No. 1843 to 
amendment No. 1836.
  Mr. BROWN. Mr. President, I ask unanimous consent that we temporarily 
set aside the pending business to go to Brown No. 3 amendment, No. 
1841.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1841

  Mr. BROWN. Mr. President, this is the amendment that deals with 
qualified blind trust and provides for reporting of the total cash 
value of that if, indeed, the trust provides that the beneficiary of 
the trust is notified under the terms of the trust. My understanding is 
both sides have reviewed this and do not have objection to it.
  Mr. McCONNELL addressed the Chair.
  The PRESIDING OFFICER. The Senator from Kentucky.
  Mr. McCONNELL. Mr. President, I am unaware of any objection to the 
Brown amendment just outlined on this side.
  Mr. LEVIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Michigan.
  Mr. LEVIN. Mr. President, I know of no objections to this amendment 
on this side. To be clear, this is the so-called Brown amendment No. 3 
earlier in the afternoon.
  Mr. BROWN. It is.
  The PRESIDING OFFICER. Is there further debate on amendment No. 1841? 
If not, the question is on agreeing to the amendment.
  The amendment (No. 1841) was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote by which 
the amendment was agreed to, and I move to lay that motion on the 
table.
  The motion to lay on the table was agreed to.
  Mr. McCONNELL. Mr. President, I ask for the yeas and nays on the 
Levin McConnell amendment.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. LEVIN. Mr. President, I ask unanimous consent that the Levin 
McConnell amendment No. 1843 be considered a substitute for amendment 
No. 1836.
  The PRESIDING OFFICER. Is there objection?
  Mr. LOTT. Mr. President, this is a technical change. We see no 
problem with it. There is no objection on this side.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.


                       Vote On Amendment No. 1843

  The PRESIDING OFFICER. The question is on agreeing to the amendment, 
No. 1843, of the Senator from Michigan.
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The assistant legislative clerk called the roll.
  Mr. LOTT. I announce that the Senator from Utah [Mr. Bennett] and the 
Senator from Indiana [Mr. Lugar] are necessarily absent.
  The result was announced--yeas 98, nays 0, as follows:

                      [Rollcall Vote No. 324 Leg.]

                                YEAS--98

     Abraham
     Akaka
     Ashcroft
     Baucus
     Biden
     Bingaman
     Bond
     Boxer
     Bradley
     Breaux
     Brown
     Bryan
     Bumpers
     Burns
     Byrd
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Conrad
     Coverdell
     Craig
     D'Amato
     Daschle
     DeWine
     Dodd
     Dole
     Domenici
     Dorgan
     Exon
     Faircloth
     Feingold
     Feinstein
     Ford
     Frist
     Glenn
     Gorton
     Graham
     Gramm
     Grams
     Grassley
     Gregg
     Harkin
     Hatch
     Hatfield
     Heflin
     Helms
     Hollings
     Hutchison
     Inhofe
     Inouye
     Jeffords
     Johnston
     Kassebaum
     Kempthorne
     Kennedy
     Kerrey
     Kerry
     Kohl 

[[Page S10554]]

     Kyl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Lott
     Mack
     McCain
     McConnell
     Mikulski
     Moseley-Braun
     Moynihan
     Murkowski
     Murray
     Nickles
     Nunn
     Packwood
     Pell
     Pressler
     Pryor
     Reid
     Robb
     Rockefeller
     Roth
     Santorum
     Sarbanes
     Shelby
     Simon
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner
     Wellstone

                             NOT VOTING--2

     Bennett
     Lugar
       
  So the amendment (No. 1843) was agreed to.
  Mr. LEVIN. Mr. President, I move to reconsider the vote by which the 
Levin-McConnell amendment, No. 1843, was agreed to.
  Mr. McCONNELL. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. McCAIN addressed the Chair.
  The PRESIDING OFFICER (Mr. Brown). The Senator from Arizona is 
recognized.
  Mr. FORD. May we have order, Mr. President?
  The PRESIDING OFFICER. The Senator will withhold for a moment.
  Regular order requires us to vote on the underlying amendment.


                 Vote On Amendment No. 1836, As Amended

  The PRESIDING OFFICER. Under the previous order, the question now 
occurs on amendment No. 1836, as amended.
  The amendment (No. 1836), as amended, was agreed to.


                           Amendment No. 1837

  The PRESIDING OFFICER. The Senator from Arizona is recognized.
  Mr. McCAIN. Mr. President, I call for regular order with regard to 
the McCain amendment No. 1837.
  The PRESIDING OFFICER. The Senator has a right to call for regular 
order and that is now the pending question.
  Mr. LEAHY. Mr. President, the Senate is still not in order.
  The PRESIDING OFFICER. The Senate will please come to order. Senators 
will cease conversation.
  The Senator from Arizona.


                    Amendment No. 1837, As Modified

  Mr. McCAIN. Mr. President, I have a modification at the desk. I ask 
unanimous consent the amendment be modified.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  The amendment (No. 1837), as modified, is as follows:

       At the appropriate place, insert the following:

     SEC.   . REPEAL OF THE RAMSPECK ACT.

       (a) Repeal.--Subsection (c) of section 3304 of title 5, 
     United States Code, is repealed.
       (b) Redesignation.--Subsection (d) of section 3304 of title 
     5, United States Code, is redesignated as subsection (c).
       (c) Effective Date.--The repeal and amendment made by this 
     section shall take effect 2 years after the date of the 
     enactment of this Act.
       Add the following new section:

     SEC. 2. EXCEPTED SERVICE AND OTHER EXPERIENCE CONSIDERATIONS 
                   FOR COMPETITIVE SERVICE APPOINTMENTS.

       (a) In General.--Section 3304 of title 5, United States 
     Code (as amended by section 2 of this Act) is further amended 
     by adding at the end thereof the following new subsection:
       ``(d) The Office of Personnel Management shall promulgate 
     regulations on the manner and extent that experience of an 
     individual in a position other than the competitive service 
     such as the excepted service (as defined under section 2103) 
     in the legislative or judicial branch, or in any private or 
     nonprofit enterprise, may be considered in making 
     appointments to a position in the competitive service (as 
     defined under section 2102).'' In promulgating such 
     regulations OPM shall not grant any preference based on the 
     fact of service in the legislative or judicial branch. The 
     regulations shall be consistent with the principles of 
     equitable competition and merit-based appointments.
       (b) Effective Date.--The amendment made by this section 
     shall take effect 2 years after the date of the enactment of 
     this Act, except the Office of Personnel Management shall--
       (1) conduct a study on excepted service considerations for 
     competitive service appointments relating to such amendment; 
     and
       (2) take all necessary actions for the regulations 
     described under such amendment to take effect as final 
     regulations on the effective date of this section.

  The PRESIDING OFFICER. The Senator from Arizona.
  Mr. McCAIN. Mr. President, this has been agreed to by Chairman Roth 
and the Governmental Affairs Committee, and with the consent of Senator 
Stevens, including language Senator Stevens added when he reported the 
legislation out of the Civil Service Subcommittee in May regarding OPM 
and judicial regulations, to consider the experience of individuals who 
served in the legislative branch as well as private sector; preference 
will not be given in these regulations.
  I thank Senator Roth and Senator Stevens for their assistance on this 
amendment.
  I yield the floor.
  The PRESIDING OFFICER. Is there further amendment or further 
discussion on amendment No. 1837, as modified?
  The Senator from Vermont.
  Mr. LEAHY. Mr. President, I do not like to ask this question. I 
realize we are in the Dracula stage of legislation. The Dracula rule 
appears, over the last several months, where we do not vote during 
daylight hours but only in the evening. Otherwise, we might be wasting 
our time with our families, our wives, our husbands, our children, 
whatever else.
  As one who would like to spend some time with his family, I wonder if 
the leader might be able to give us some idea whether this will be one 
of those 2 or 3 evenings a month that we are allowed time with our 
families. I realize the commitment of everybody here to family values. 
I just ask that question.
  The PRESIDING OFFICER. The Senator from Mississippi is recognized.
  Mr. LOTT. Mr. President, a great deal of progress has been made 
today. That last vote was an indication of how much progress has been 
made in working out an agreement on this legislation.
  There is now an agreement on the McCain amendment. There are other 
amendments being discussed that we could hopefully reach agreement on. 
There are some that still may require some recorded votes tonight. The 
leader has indicated he would like for us to push on and see if we can 
work out as many amendments as possible and get votes on others and get 
to final passage on lobby reform tonight.
  The reason for that is we do still have to take up, under the 
unanimous-consent agreement, gift reform later on tonight or tomorrow, 
without votes on gift reform tonight. We do have the Bosnia resolution 
pending for consideration tomorrow afternoon, and many other bills that 
we need to complete before we get to our August recess period.
  But the answer to the question of the Senator from Vermont is, we do 
want to go forward. We think we can complete this legislation at a 
reasonable hour tonight.
  Mr. LEAHY. Mr. President, I appreciate what the Senator from 
Mississippi has said. I do compliment the Senator from Kentucky and the 
Senator from Michigan. I know from various phone calls that went back 
and forth they have done yeomen's service here today in reaching this 
area of agreement. Obviously, had they not, we could be here much, much 
longer than we have.
  The question I have again, for some of us who have families, is there 
going to be either a window or shall we tell them to all go to bed and 
get up at 1 tomorrow morning to see us? I do not mean to question 
facetiously, but we are falling into this trend of almost Dracula 
voting--we only vote when the Sun goes down. But some of us do have 
families and would like to see them.
  I ask the question in all seriousness, will there be a window? Will 
there be time? Shall we make any plans to see our families?
  Mr. LOTT. To respond further, it is very difficult to say right now 
that could be done because we have three or four negotiations going on 
simultaneously. We may get those worked out shortly, and then there 
would not be a necessity for votes again in the next hour. But right 
now, we could not indicate that there will be a window. We want to try 
to complete this before it is late tonight. That would be the best way 
so that we all could go home at 8 or 8:30.
  Mr. LEAHY. Is there a possibility of setting the votes in the 
morning?
  Mr. LOTT. There is. We would have to check to see where the 
negotiations are. There is a possibility we could have stacked votes 
later on tonight, or perhaps even in the morning. Right now the leader 
wants us to push this forward so we can get an agreement. I believe we 
can accomplish that. 

[[Page S10555]]

  I yield the floor.
  Mr. DOMENICI. Mr. President, will the Senator not leave for a moment? 
I wonder. Whoever is putting this together, have you considered a 
sliding scale, sort of a means testing on the gifts?
  The PRESIDING OFFICER. If the Senator will withhold, the Senate will 
be in order.
  The Senator from New Mexico.
  Mr. DOMENICI. I want to repeat my question. I am sure the 
distinguished Senator from Mississippi took it far too seriously. Let 
me repeat it again with a big smile.
  Some of us are wondering whether you have considered a sliding scale 
on the gifts, a means testing for some of us who are in different 
conditions of finances than others. There are some who are in such 
great finances that they ought to be willing to have no gifts of any 
type under any circumstances. Have you ever considered a means testing 
for gifts?
  Mr. LOTT. If I might respond, Mr. President, the gift rule issue will 
not come up until later on tonight with votes not occurring on that 
today but tomorrow. Speaking for myself, I think that is a great idea.
  [Laughter.]
  Mr. DOMENICI. I am going to bring that to a vote.
  Thank you very much.
  Mr. McCONNELL addressed the Chair.
  The PRESIDING OFFICER. Is there further debate on amendment 1837, as 
modified? If there is no further debate on the amendment No. 1837, the 
question is on agreeing to the amendment.
  The amendment (No. 1837), as modified, was agreed to.
  Mr. McCONNELL. Mr. President, may we have order? The Senate is still 
not in order, Mr. President.
  The PRESIDING OFFICER. The Senate will be in order. Those 
participating in conversations will please retire to the cloakrooms. 
The Senate is not in order.
  The Senator from Kentucky is recognized.
  Mr. McCONNELL. Mr. President, as the majority whip indicated, we 
believe we are down to a relatively few amendments. There is an 
excellent chance of finishing the bill tonight.
  Mr. President, I see my friend from Michigan seeking recognition. So 
I yield the floor.
  Mr. LEVIN addressed the Chair.
  The PRESIDING OFFICER. The Senator from Michigan.


                  Vote Vitiated on Amendment No. 1841

  Mr. LEVIN. Mr. President, after consulting with the Presiding 
Officer, whose amendment I am referring to, I would ask unanimous 
consent to vitiate the vote on the so-called Brown No. 3 amendment, 
which was voice voted in the last 20 minutes. There was a problem with 
it that this Senator was not aware of. I indicated that I had no 
objection. In fact, there was some objection.
  I ask unanimous consent that we vitiate the vote approving Brown 3 
with the right of the Senator from Colorado, of course, to offer that 
amendment at any time.
  The PRESIDING OFFICER. Is there objection? Without objection, it is 
so ordered.
  Mr. LEVIN. I thank the Presiding Officer.
  Mr. LOTT. Mr. President, can I inquire as to whether or not we 
reached the point where maybe we could get an agreement to dispose of 
the Craig-Simpson modified amendment by voice vote? I understood maybe 
that was now possible. That would rid us of the necessity for another 
recorded vote. I am told that perhaps the other side is willing to 
agree to that now. I do have a unanimous consent request, if that is 
possible.
  Mr. LEVIN. I do not know of a request for a rollcall vote on the 
Simpson amendment on this side. However, I would like all Members to 
understand that this is a very significant amendment which is going to 
affect 501(c)(4) organizations and would state that a 501(c)(4) 
organization, which includes Blue Cross, AARP, Disabled American 
Veterans, International Olympic Committee, and a whole host of other 
organizations that currently are allowed, although they have a tax 
exemption, to lobby, that under the Simpson-Craig amendment, they no 
longer would be allowed to receive a grant or an award from the Federal 
Government at the same time that they are allowed to lobby.
  I think this creates a whole host of new issues. I am not on the 
Finance Committee. Unless someone from the Finance Committee wishes to 
get into this in some detail, I do not know of any indication on this 
side for a rollcall vote.
  Mr. DODD. If the Senator will yield, frankly, this is one Senator who 
may want a vote. I am uneasy, I say, Mr. President. This raises a 
question, I say to my colleague. I am very uneasy about this list. I am 
not sure it is a complete list of 501(c)(4)'s. Some of them may very 
well be deserving of grants. I do not have any difficulty being lobbied 
by some of these organizations. It sounds to me like you have a few 
here that are being targeted for some specific purpose.
  I think we ought to think more carefully before we take a rather 
significant step in deciding that a whole group of very legitimate 
organizations, that may very well qualify for grants of one kind or 
another, all of a sudden are being precluded from either doing that or 
lobbying Members of the U.S. Senate.
  I, for one, would prefer to have a rollcall vote on this and have a 
voice vote, and I do not know frankly what the implications are.
  The PRESIDING OFFICER. The Senator from Wyoming.
  Mr. SIMPSON. Mr. President, if I can draw the attention of my 
colleagues back to the issue here, we had the debate which was not 
participated in by everyone. And I understand that. I have been here 
for several years.
  Let me tell you what this is. This is not an attempt to get anybody. 
The amendment is very clear. I am going to read it.
  Here is the amendment with regard to 501(c)(4) corporations. There 
are a lot of them. This does not have anything to do with 501(c)(3) 
corporations, charitable corporations, the kind we think of most often. 
It has nothing to do with universities. It has nothing to do with 
501(c)(5) corporations or 501(c)(6) corporations.
  Remember, a 501(c)(4) corporation is tax-exempt and has unlimited 
ability to lobby with unlimited sums of money. They can lobby with $20 
or $30 million, if they wish. There is no limitation whatsoever on 
lobbying activities. That is a 501(c)(4).
  The 501(c)(3)'s are limited to a certain amount, a million bucks. You 
cannot go over that--501(c)(5)'s and (c)(6)'s have limitations. Here is 
what the amendment says:

       An organization described in section 501(c)(4) of the 
     Internal Revenue Code of 1986 which engages in lobbying shall 
     not be eligible for the receipt of Federal funds constituting 
     an award, grant, contract, loan, or any other form.

  Meaning that if a 501(c)(4) decided that they wanted to continue to 
lobby and were receiving Federal funds, they could no longer continue 
to lobby. However, if they wished to continue to receive Federal funds, 
then they would limit their lobbying activities. They can also go into 
splits, if they wish to split a 501(c)(4) organization. At least that 
would be an improvement over present law, which simply says that these 
groups can lobby. And if you are doing something with lobbying reform, 
it would seem to me you would want to do something with the one tax-
exempt organization that can lobby with unlimited funding and still 
receive grants from the Federal Government to do so.
  Mr. DODD. I apologize for not being here earlier today. Like most 
Members, I was not here in town for the debate.
  I am looking down the list here of some of these numbers. I am told--
correct me if I am wrong--there are 140,000 501(c)(4) organizations in 
the United States.
  Now, I am looking at a list of 20 or 30 here. Obviously, it may be a 
list put together to cause someone like me to raise the issue, but I 
look at the Fireman's Association, State of New York, Group Health 
Association--a lot of groups that may very well qualify for grants, and 
I certainly, as a Member, do not have any objection if they want to 
come and lobby me in the office for some particular purpose. I do not 
know why we are singling out that particular group in this particular 
environment.
  Now, to me, to disqualify 140,000 organizations in the United States 
seems to go a little too far.

[[Page S10556]]

  Mr. SIMPSON. Mr. President, we are not disqualifying 140,000 
organizations of the United States. We are disqualifying those that 
receive funding from the Federal Government, and very few of these do. 
Some receive minuscule amounts, most receive none. Here is the Mutual 
of America Life Insurance Co. with assets of $5.5 billion. I doubt that 
they receive anything from the Federal Government for lobbying 
activities.
  Mr. DODD. I ask my colleague, what is the point of the amendment 
then? If none of them is getting grants, why do we need an amendment?
  Mr. SIMPSON. The point of the amendment is there are many tax-exempt 
501(c)(4) corporations that receive grants, awards, contracts, or 
loans, or any other form from the Federal Government and use it to 
lobby the Federal Government for more Federal money for themselves.
  Mr. LEVIN. Will the Senator yield on that point? I do not know who 
has the floor.
  The PRESIDING OFFICER. The Senator from Wyoming has the floor.
  Mr. LEVIN. Will the Senator from Wyoming yield on that point?
  Mr. SIMPSON. Certainly.
  Mr. LEVIN. The Senator just said that they could use the grant for 
lobbying purposes. I think that he misspoke when he said that because 
there is a law which prohibits the use of appropriated funds for 
lobbying activities.
  What the amendment does is something different, because we already 
have a ban on using appropriated funds for lobbying.
  What the amendment says is that if an organization gets funds from 
some other source, if a 501(c)(4) gets funds from some other source and 
uses those other funds to lobby, it may not then get a grant or an 
award from the Federal Government to do some social function that is 
within the scope of the grant.
  I do not think the Senator from Wyoming is suggesting--at least I 
hope he is not--that currently a 501(c)(4) can get a grant or an award 
from the Federal Government and use that money to pay for lobbying.
  Mr. SIMPSON. Mr. President, under the present law of the United 
States, when we are talking about a tax-exempt corporation, we are 
seeing happening in the country--this is something we have had one 
hearing on; there will be many more--where the Government is 
subsidizing the programs and activities of huge lobbying organizations 
that are engaged in things on the direct edge of UBIT, which is the 
unrelated business income Tax, that are involved in profitmaking 
activities and that receive a tax-exempt status.
  What we are saying is those organizations which lobby without limit--
and this is the only one in the whole panoply that lobbies without 
limit, without any kind of limitation on the amount of money they can 
spend. So if you are going to do a lobbying reform bill, it would seem 
to me that you would want to deal with the one subsection (c) 
corporation that can spend itself into oblivion and even use Federal 
money in the process of receiving grants, awards, notes, whatever it 
may be, bonuses, contracts, and we are saying you make a choice here. 
If you are going to lobby, then you are not going to receive Federal 
grants. If you want to receive Federal grants, you do not lobby. Take 
your pick.
  Mr. DODD. If my colleague will yield further, I appreciate his point.
  Mr. SIMPSON. I will yield to the Senator from Idaho.
  Mr. CRAIG. All money is fungible, and if there is not a clear, tight 
bookkeeping system, as there is in a 501(c)(3), which the IRS says very 
clearly how much of its assets or what percentage of it it can spend in 
lobbying up to a universal cap of $1 million, then we went over and 
created a 501(c)(4) which said you can be tax-exempt and you can have 
unlimited advocacy.
  What we have seen over the years is not only do they have unlimited 
advocacy, and, yes, there is a rather open bookkeeping system and, yes, 
there is a prohibition against using Federal dollars, tax dollars for 
the purpose of lobbying, all of the money moves inside the organization 
and it is extremely fungible.
  We are saying, if you want to retain your 501(c)(4) for lobbying, you 
can and you should and you are tax-exempt. But if you want to do the 
grant business, go create something else for that purpose so there is a 
clear line so the taxpayers of this country can know and know very well 
that there is not the fungibility that is going on here, not in the 
hundreds of thousands of those organizations but in a substantial 
number that have taken advantage of a tax-exempt status. I do not think 
the Senator and I, in granting that tax-exempt status, want to allow 
them to take advantage.
  Now, we do not want to deny them the opportunity to serve their 
public and their membership, and they can do that by shifting their 
status for certain purposes.
  Mr. DODD. I thank my colleague. If my colleague will yield further, I 
will seek time or whatever.
  Mr. DODD addressed the Chair.
  The PRESIDING OFFICER. The Senator from Connecticut is recognized.
  Mr. DODD. Mr. President, I might inquire of a couple things. One, I 
am told there are some 140,000 of these organizations. I do not know. 
And maybe there have been hearings on this by the Finance Committee. 
This is a pretty significant step we are taking. Could I inquire of my 
colleague from Wyoming whether or not there have been any hearings on 
what the implications of this are? I presume it is a Finance Committee 
matter since it is a 501(c)(4). And what are the tax implications of 
it? I do not know if that has been done.
  Mr. SIMPSON. Mr. President, we did have a hearing in the Finance 
Committee on these issues of tax exempts, and we will have many more. 
We did, indeed. The ``little guys'' that people have been talking about 
protecting, grassroots and so on, they are going to be well protected 
because they are, most of them, 501(c)(3).
  We are talking about a singular group of maybe 140,000--that is 
exactly correct--and we are talking about big time, big time lobbying. 
One group spends $26 million a year on unlimited lobbying and receives 
grants from the Federal Government. We are saying if you do that, then 
you are no longer going to receive the grants. You can lobby to 
oblivion; you can continue to do whatever you wish to do. Or if you 
wish not to receive grants or receive grants, you take your choice. Or 
you can split into two 501(c)(4)'s, one lobbying with all sorts of 
money and dues, it is perfectly appropriate, without limit; or, if you 
are going to receive Federal funds, you do not lobby. You take your 
pick.
  Mr. DODD. I thank my colleague for his response, Mr. President.
  I just say again, I do not hold myself as any expert in this area, 
but it seems to me we are taking, in my view, I do say with all due 
respect to my good friend, a rather draconian step; with 140,000 
organizations in this country, admittedly, by one of the authors of the 
amendment, out of the 140,000 we are talking a handful that really 
stick in the craw of my colleague from Wyoming.
  In doing so, my own view is I do not know why we ought to take 
139,900 and ask them to pay an awful price here because of what 100 
organizations may be doing that is offensive. My view is we are 
changing a pretty significant piece of tax law when it comes to these 
organizations. And to step forward and single out 140,000 
organizations, most of which are pretty small operators here that have 
set up under those guidelines, I think goes too far.
  Now, clearly, there may be some here that, because of their income 
status or whatever, maybe we ought to come back with another amendment 
that deals with some of those in some specific way. But to pick on 
groups here that literally are tiny--the Henry Ford Health Care Corp., 
the Higher Education Foundation, they are on the list of organizations 
here that do not seem to me to be any great threat to anyone.
  So, Mr. President, with great respect to the authors of the 
amendment, I think this just goes too far. I think we are stepping way 
over a line here. If we are going to change entirely the nature of 
501(c)(4) corporations, I think we ought to have some specific 
hearings, there ought to be specific legislation that comes up and not 
have an amendment offered on the floor that wipes out 140,000 
organizations from what has been up to this very moment a legitimate 
tax status. 

[[Page S10557]]

  I say to my colleague from Idaho, money is fungible, but the fact of 
the matter is the law is the law.
 And you are not allowed to use taxpayer money for lobbying purposes. 
That is the law. If someone does, they are in violation of the law and 
there are penalties associated with that.

  But to suggest because there is some grant money there that somehow 
all of that leaches into the rest of this money and ends up being used 
for lobbying purposes I think, frankly, is to suggest that somehow 
people are out there violating the law right and left, and I do not see 
it.
  Come back if you want to on this one, but I do not know why you want 
to take 140,000 organizations and relegate them to a very unique 
status--all of them in this country--because of the complaints of a 
few.
  Mr. CRAIG. Will the Senator yield?
  Mr. DODD. I will be glad to yield.
  The PRESIDING OFFICER. The Senator from Connecticut has yielded for a 
question.
  Mr. DODD. Certainly.
  Mr. CRAIG. I think it is important to cite here that we are not 
amending the Tax Code. We are using the Tax Code to identify the group 
in lobbying, and that clarification is how I read what we are doing. I 
think it is also fair to say that any 501(c)(4) that chooses not to get 
a grant and feed at the Federal trough is exempt.
  Mr. DODD. May I ask my colleague, for instance, why are we not 
including 50l(c)(6)? Those are trade associations. They are tax exempt. 
They get Federal contracts and grants and they lobby.
  Mr. CRAIG. Because there is an entirely different qualifying 
mechanism under the IRS Code for them, and they are watched very 
closely and their audits are held very tightly.
  Mr. DODD. Will my colleague not agree they meet all the standards the 
Senator applies to this amendment?
  Mr. CRAIG. Absolutely.
  Mr. DODD. They are trade associations. They get grants and they 
lobby. Why is there any reason to suspect they are going to be any 
different in terms of their tax dollars----
  Mr. CRAIG. The term is unlimited versus the percentages of total 
revenue base. The IRS Code already established that. 501(c)(4) is an 
unlimited category.
  Mr. LEVIN. Will the Senator from Connecticut yield for a question?
  Mr. DODD. I yield to my colleague from Michigan.
  Several Senators addressed the Chair.
  The PRESIDING OFFICER. The Senator from Connecticut has yielded to 
the Senator from Michigan for a question.
  Mr. LEVIN. It seems to me the Senator from Connecticut is pointing 
out something which is very significant, which is that the proponents 
of the amendment are basically using the amendment which will ban a 
501(c)(4) organization from doing something it currently does, which is 
to both lobby with its own funds and to receive a grant for a public 
purpose somewhere else.
  The purpose of this amendment, as I understand it, is an accounting 
purpose. The argument is made that money is fungible and, therefore, we 
have to make sure they do not use public funds for lobbying purposes 
and that we need an accounting mechanism in order to be sure that that 
is not done.
  In 18 United States Code section 1913, it already says that:

       No part of the money appropriated by Congress shall, in the 
     absence of express authorization by Congress, be used 
     directly or indirectly to pay for any personal service, 
     advertisement, telegram, telephone, letter, printed or 
     written matter, or other device intended or designed to 
     influence in any manner a Member of Congress to favor or 
     oppose by vote or otherwise any legislation or appropriation 
     by Congress whether before or after the introduction of any 
     bill or resolution proposing such legislation or 
     appropriation.

  So we already have a ban on the use of public funds for lobbying. It 
seems to me what this comes down to then is to say we are going to 
change the rules currently lived by 140,000 organizations in order to 
make sure that the few organizations, relatively, that lobby keep good 
books.
  Mr. DODD. I say to my colleague----
  Mr. LEVIN. I am wondering whether the Senator from Connecticut will 
agree.
  Mr. DODD. I agree. It sounds like the ``Lawyers and Accountants 
Relief Act.'' You hire accountants and lawyers and create two 
organizations and you have met the standard. I suppose you can get 
around the law that way. I am not sure that is what we want to be doing 
necessarily, except that a lot of smaller organizations that do not 
have the resources are going to have to go out and hire people to do 
it.
  For the life of me, I do not understand the value, particularly when 
the law is clear when you use those resources.
  Mr. LEVIN. My question to the Senator is this: Will the Senator agree 
that an amendment might be in order that might require 501(c)(4)'s to 
maintain clear books as to how they use Federal funds for Federal 
purposes and do not use those funds for lobbying purposes? Will the 
Senator agree that that kind of an amendment might be appropriate in 
order to address the fungibility issue of the Senator from Idaho?
  Mr. DODD. I say to my colleague from Michigan, that would at least--I 
understand the heart of the argument in a sense, that the fungibility 
question is one that people are worried about. I suggest if we are 
going to do it, we might apply it to the 501(c)(6) organizations as 
well. That at least addresses a potential problem, although to me that 
may be solved by means other than through the amendment process.
  Nonetheless, that would at least make some sense to me. But to wipe 
out 140,000 organizations--as I say, I do not hold myself out--I just 
happened to walk on the floor and heard this amendment was coming up, 
and it seemed to go too far. I do not have a particular brief; no one 
talked about it. I looked at the list and said, ``Why are we taking 
140,000 organizations in this country that are 501(c)(4) organizations 
and all of a sudden applying a standard that I think goes beyond the 
pale?'' That is all I feel about it. I do not have a particular brief 
for it. It just seems to go too far for me.
  Mr. SIMPSON addressed the Chair.
  The PRESIDING OFFICER. The Senator from Wyoming is recognized.
  Mr. SIMPSON. Mr. President, I say to my friend from Connecticut, 
after 16 years of legislating on the floor, I remember one incident 
distinctly. We went for 5 days of debate--I was managing the bill--and 
suddenly in the door came one of our colleagues. He happened to be on 
our side of the aisle and had paid no particular interest in the 
measure, and suddenly just went for it tooth and fang. I thought, well, 
that is interesting.
  Mr. DODD. Did he win or lose?
  Mr. SIMPSON. Oh, he lost.
  Mr. DODD. I had a feeling that was the answer.
  [Laughter.]
  Mr. SIMPSON. Directing my remarks to the Chair, of course, rather 
than my colleague from Connecticut, let me just say we are not wiping 
out anybody. We are not in the business of wiping out 501(c)(4)'s, and 
if you want to go to 501 (c)(6)'s and (c)(5)'s, I am ready to go there, 
too. But I did not want to bite off too big a chunk because I did not 
want to get into it with the chamber of commerce and the AFL-CIO.
  Mr. DODD. The AFL-CIO is a 501(c)(4).
  Mr. SIMPSON. No, they are not.
  Mr. DODD. I am told they are----
  Mr. SIMPSON. They are a (c)(5); the AFL-CIO is a (c)(5).
  Mr. DODD. Right; (c)(5).
  Mr. SIMPSON. So is the U.S. Chamber of Commerce.
  Mr. DODD. I apologize to my colleague.
  Mr. SIMPSON. What we are saying is if anyone gets stung here in this 
process, they can go become a 501(c)(3) if they are really into big-
time charity, doing things that you would like to see charities do. 
They can be a 501(c)(3). That is a charitable corporation; that is $1 
million limiting activity of lobbying. They can give up lobbying or 
they can go into a separate split-off. They can split into two, a 
lobbying organization or a grant organization. That is what we are 
saying.
  We are seeing abuses of the system. This is not about tax exemption. 
This is about lobbying. I thought that is what this is about.
  Why in the world should we allow a group to have unlimited ability to 
spend their members' dues and then use Federal money to offset what 
they ordinarily would have paid? They 

[[Page S10558]]
would have had to pay for this somewhere but, no, they get it from the 
Feds. I think that is wrong if you are doing lobbying reform.
  Mr. DOMENICI addressed the Chair.
  The PRESIDING OFFICER. The Senator from New Mexico is recognized.
  Mr. DOMENICI. Mr. President, I frequently come to the floor on the 
spur of the moment like my friend from Connecticut--and we see eye to 
eye--but I think he is wrong on this one. I think the Senator from 
Wyoming is right.
  Frankly, I did not know this was legal. I could not imagine that you 
would have a tax-exempt corporation--meaning they do not pay any tax on 
all the money they take in--going out and lobbying the Federal 
Government, because that is permissive, and then going out and seeking 
grants from the Federal Government. I could not imagine a situation 
with more potential for conflict of interest than putting in a 
corporation that gets all these benefits and can lobby the Federal 
Government and then saying, ``On the other hand, you can go get all the 
money you can scratch out of these grants''--and do what with it? Spend 
it for the same entity, the same corporation.
  If I were to have had this before me at the beginning when it was 
passed, I would have voted against it. I think it is an exciting idea 
that when you are reforming the lobbying laws of the Nation that you 
give the corporations a clear opportunity. If you want to lobby, you 
choose another tax-exempt status.
  If you want to choose this one, then do not go to the Federal 
Government against whom you are lobbying to get money. It seems to me 
pretty clear that the Senator from Wyoming is on the right track. I 
hope we will vote soon and get rid of this opportunity that we should 
never have given to these kinds of nonprofit corporations.
  I yield the floor.
  Mr. McCONNELL. Mr. President, let me say that we are down to six 
amendments, most of which I think are going to be accepted. There is an 
excellent chance of finishing this bill very soon. I do not want to 
interrupt the debate going on. But we can get through here pretty 
quickly if we will have the cooperation of Senators.
  I yield the floor.
  Mr. LOTT. Mr. President, I know that some Members are waiting to see 
if we are going to have a vote momentarily, or whether we are going to 
do this on a voice vote or not. I believe that the yeas and nays have 
already been ordered on the underlying Simpson amendment.
  So I believe we are ready to go to a vote. Does the Senator want to 
dispose of this on a voice vote?
  Mr. DODD. I would like a recorded vote. Has there been a request for 
a recorded vote?
  The PRESIDING OFFICER. The yeas and nays have been ordered on the 
underlying amendment. There is a second-degree amendment that the yeas 
and nays have not been ordered on.
  Mr. DODD. Which is the second-degree amendment?
  Mr. LOTT. Let me see if I can clarify a request here.
  I ask unanimous consent that the Senate proceed to vote on or in 
relation to the Craig amendment, as further modified, that no 
amendments be in order to the Craig amendment No. 1843, and that 
following the disposition of the Craig amendment, the Senate proceed to 
the adoption of the Simpson amendment No. 1839, as amended, if amended.
  The PRESIDING OFFICER. Is there objection?
  Without objection, it is so ordered.
  Mr. LOTT. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. DORGAN. Mr. President, let me inquire further of the Senator from 
Mississippi as to what he expects for a schedule tonight. Some of us 
would like to know, if we have a recorded vote now, when will we have 
the next recorded vote?
  Mr. LOTT. Mr. President, we are down to half a dozen amendments. We 
believe we can work out agreements on some of those. Some we believe we 
can voice vote. We think we are down to maybe a couple more votes 
tonight, and we would like to go ahead and move toward getting a 
conclusion on those amendments.
  Mr. DORGAN. Mr. President, I would observe that much of the day was 
spent in quorum calls and now, as we reach the dinner hour, we seem to 
be more interested in debate.
  Mr. LOTT. Let me respond to the Senator, if I could. Let us go ahead 
and go to this recorded vote, and during that vote we will see if we 
can get a further clarification on exactly when the final votes would 
occur. We will work on that and tell the Members after this vote.
  Mr. DORGAN. That is fine with me. I hope that the majority will 
consider rolling votes tomorrow morning. I hope he will consider doing 
this on a routine basis. If we have a couple more votes, rather than 
people coming back at 9 or 10 p.m. to cast votes, why not stack them 
for the first thing in the morning?
  Mr. LOTT. We will have to check with the majority leader on that. The 
important thing is that we need to finish lobby reform, so that we can 
go to gift reform first thing in the morning. Perhaps we can work 
something out along the lines of what he is suggesting.
  I ask unanimous consent that the yeas and nays be vitiated on the 
underlying Simpson amendment No. 1839.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. LOTT. I believe we are ready to vote.
  The PRESIDING OFFICER. The question is on agreeing to amendment No. 
1842, as further modified.
  The yeas and nays have been ordered.
  The clerk will call the roll.
  The bill clerk called the roll.
  Mr. LOTT. I announce that the Senator from Utah [Mr. Bennett] and the 
Senator from Indiana [Mr. Lugar] are necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
desiring to vote?
  The result was announced--yeas 59, nays 39, as follows:

                      [Rollcall Vote No. 325 Leg.]

                                YEAS--59

     Abraham
     Ashcroft
     Baucus
     Bond
     Breaux
     Brown
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Feinstein
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hollings
     Hutchison
     Inhofe
     Johnston
     Kassebaum
     Kempthorne
     Kerrey
     Kerry
     Kyl
     Lott
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Packwood
     Pressler
     Reid
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--39

     Akaka
     Biden
     Bingaman
     Boxer
     Bradley
     Bryan
     Bumpers
     Byrd
     Conrad
     Daschle
     Dodd
     Dorgan
     Exon
     Feingold
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Inouye
     Jeffords
     Kennedy
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nunn
     Pell
     Pryor
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone

                             NOT VOTING--2

     Bennett
     Lugar
       
  So the amendment (No. 1842), as further modified, was agreed to.
  The PRESIDING OFFICER. The question is on the underlying amendment, 
as amended.
  Mr. EXON. Mr. President, may we have order, please?
  Mr. McCONNELL. I move to reconsider the vote.
  The PRESIDING OFFICER. The Senate will be in order.
  The motion to reconsider the previous vote has been made.
  Mr. KERRY. I move to lay that motion on the table.
  The PRESIDING OFFICER. There is a motion to lay it on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Nebraska.


                     Amendment No. 1839, As Amended

  Mr. EXON. Mr. President, what is the matter currently before the 
Senate?
  The PRESIDING OFFICER. Amendment No. 1839, as amended.
  Mr. EXON. Further debate has been ordered, then, before we proceed to 
consider the matter for final approval, is that right? 

[[Page S10559]]

  The PRESIDING OFFICER. Under the previous order, it provided for an 
immediate vote upon the disposition of the second-degree amendment.
  Mr. EXON. There was a unanimous-consent agreement to that effect?
  The PRESIDING OFFICER. That is correct.
  The question is on the underlying first-degree amendment, as amended.
  Mr. EXON. Mr. President, I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? This is the same 
amendment as just voted on. Is there a sufficient second?
  Mr. EXON. I ask for the yeas and nays.
  The PRESIDING OFFICER. Is there a sufficient second? There is not a 
sufficient second.
  Mr. EXON. I know that.
  The PRESIDING OFFICER. There is not sufficient second.
  Mr. LOTT. Parliamentary inquiry, Mr. President.
  The PRESIDING OFFICER. The Senator from Mississippi is recognized for 
a parliamentary inquiry.
  Mr. LOTT. There was a good deal of discussion when the Senator from 
Nebraska was making his motion. Is he asking for a recorded vote on the 
Simpson amendment?
  Mr. FORD. As amended.
  The PRESIDING OFFICER. That is the Chair's understanding.
  Mr. LOTT. I thought we had vitiated that in an earlier unanimous-
consent request?
  The PRESIDING OFFICER. That is correct.
  Mr. LOTT. So that has been disposed of.
  The PRESIDING OFFICER. The Senator from Nebraska.
  Mr. EXON. May I make further inquiry of the Chair?
  If I understand what the situation is at the present time, there was 
a unanimous consent agreement earlier, after we had voted on the 
second-degree amendment, that the underlying amendment offered by the 
Senator from Wyoming would then be approved on a voice vote? Was that 
the unanimous-consent agreement?
  The PRESIDING OFFICER. It would be voted on immediately following.
  Mr. EXON. Immediately following.
  I have asked for a rollcall vote. I did not receive a sufficient 
second? Is that the ruling of the Chair?
  The PRESIDING OFFICER. That is correct.
  Mr. EXON. I make one further request for a rollcall vote on the 
Simpson amendment.
  The PRESIDING OFFICER. The yeas and nays are requested. Is there a 
sufficient second?
  Mr. LOTT. Mr. President, I observe the absence of a quorum.
  Mr. FORD. Regular order.
  The PRESIDING OFFICER. The regular order is for the Chair to 
determine.
  Mr. LOTT. Mr. President, again, parliamentary inquiry, I think we 
need to try to understand exactly where we are and what we are trying 
to accomplish here.
  I believe, in framing my parliamentary inquiry, the amendment now 
before us is identical to the language we just voted on. And, 
therefore, this would be a second recorded vote on the same issue we 
just voted on now, under the Craig amendment?
  The PRESIDING OFFICER. The Senator from Mississippi is correct.
  The yeas and nays have been requested.
  Mr. LOTT. Mr. President, just one further parliamentary inquiry. We 
were to the point, if we were able to complete that vote and dispose of 
it, hopefully, to enter a unanimous-consent agreement that would allow 
us to complete action tonight and perhaps have final passage on this 
issue, a final vote in the morning at 9 o'clock.
  So I was in hopes that we could complete this final vote that we just 
had and move on to the unanimous consent agreement without additional 
recorded votes tonight. I just wanted to make that point before we 
proceed further.
  The PRESIDING OFFICER. The yeas and nays have been requested.
  Is there a sufficient second?
  Mr. BUMPERS. Mr. President, parliamentary inquiry.
  The PRESIDING OFFICER. The Senator from Arkansas is recognized for a 
parliamentary inquiry.
  Mr. BUMPERS. Mr. President, parliamentary inquiry. Did I understand 
just now that the order is that since this rollcall vote has been 
requested by the Senator from Nebraska, we vote on that and that the 
only pending business left before final will be voted on at 9 o'clock 
in the morning? Is that correct?
  Mr. LOTT. Mr. President, if I might respond to the Senator from 
Arkansas, no. It was our hope that we could then enter into a 
unanimous-consent agreement that would, if we get all the details 
agreed to, say that any further recorded votes would occur in the 
morning at 9 o'clock on any amendments thereto and final passage if any 
amendments are requested for recorded vote.
  Mr. BUMPERS. Mr. President, I just ask the distinguished assistant 
majority leader if he can tell us how many amendments we are working 
on. What is the potential for more votes?
  Mr. LOTT. Mr. President, if I might respond, there are about three 
amendments that are still pending. We think maybe a recorded vote would 
be necessary on one of those amendments. But we need to work through 
the unanimous-consent agreement first.
  Mr. LAUTENBERG. Will the Senator from Mississippi yield for a 
question? Can we identify those amendments?
  Mr. LOTT. They have been identified. We have discussed those with the 
distinguished Democratic leader and with the managers of the bill.
  Mr. LAUTENBERG. I would like to know who the author is and what the 
nature of these amendments are before agreeing to closing out the 
amendment tree and leaving only final passage to be considered.
  Mr. LOTT. That would be the hope of the managers of the bill as soon 
as we move to that. In fact, I think we are ready to go to the 
unanimous-consent request here momentarily.
  The PRESIDING OFFICER (Mr. Grams). The yeas and nays have been 
requested. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  The PRESIDING OFFICER. The question is on agreeing to the amendment 
of the Senator from Wyoming. On this question, the yeas and nays have 
been ordered, and the clerk will call the roll.
  Mr. LOTT. I announce that the Senator from Utah [Mr. Bennett] and the 
Senator from Indiana [Mr. Lugar] are necessarily absent.
  Mr. FORD. I announce that the Senator from North Dakota [Mr. Dorgan] 
and the Senator from Louisiana [Mr. Johnston] are necessarily absent.
  The PRESIDING OFFICER. Are there any other Senators in the Chamber 
who desired to vote?
  The result was announced--yeas 59, nays 37, as follows:

                      [Rollcall Vote No. 326 Leg.]

                                YEAS--59

     Abraham
     Ashcroft
     Baucus
     Bond
     Breaux
     Brown
     Burns
     Campbell
     Chafee
     Coats
     Cochran
     Cohen
     Coverdell
     Craig
     D'Amato
     DeWine
     Dole
     Domenici
     Faircloth
     Feinstein
     Frist
     Gorton
     Gramm
     Grams
     Grassley
     Gregg
     Hatch
     Hatfield
     Helms
     Hollings
     Hutchison
     Inhofe
     Jeffords
     Kassebaum
     Kempthorne
     Kerrey
     Kerry
     Kyl
     Lott
     Mack
     McCain
     McConnell
     Murkowski
     Nickles
     Packwood
     Pressler
     Reid
     Roth
     Santorum
     Shelby
     Simpson
     Smith
     Snowe
     Specter
     Stevens
     Thomas
     Thompson
     Thurmond
     Warner

                                NAYS--37

     Akaka
     Biden
     Bingaman
     Boxer
     Bradley
     Bryan
     Bumpers
     Byrd
     Conrad
     Daschle
     Dodd
     Exon
     Feingold
     Ford
     Glenn
     Graham
     Harkin
     Heflin
     Inouye
     Kennedy
     Kohl
     Lautenberg
     Leahy
     Levin
     Lieberman
     Mikulski
     Moseley-Braun
     Moynihan
     Murray
     Nunn
     Pell
     Pryor
     Robb
     Rockefeller
     Sarbanes
     Simon
     Wellstone

                             NOT VOTING--4

     Bennett
     Dorgan
     Johnston
     Lugar
  So, the amendment (No. 1839), as amended, was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote by which 
the amendment was agreed to.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. McCONNELL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll. 

[[Page S10560]]

  The assistant legislative clerk proceeded to call the roll.
  Mr. FORD. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                    Amendment No. 1838, As Modified
  Mr. FORD. Mr. President, the distinguished Senator from Colorado [Mr. 
Brown] and I have been working on amendment No. 1838. We now have 
arrived at an agreement.
  I ask unanimous consent to modify amendment No. 1838.
  The PRESIDING OFFICER. Without objection, it is so ordered. The 
amendment is so modified.
  The amendment, as modified, is as follows:

       At the appropriate place in the bill, insert the following:

     SEC.  . DISCLOSURE OF THE VALUE OF ASSETS UNDER THE ETHICS IN 
                   GOVERNMENT ACT OF 1978.

       (a) Income.--Section 102(a)(1)(B) of the Ethics in 
     Government Act of 1978 is amended--
       (1) in clause (vii) by striking ``or''; and
       (2) by striking clause (viii) and inserting the following:
       ``(viii) greater than $1,000,000 but not more than 
     $5,000,000, or
       ``(ix) greater than $5,000,000;
       ``(x) greater than $1,000,000.''
       (b) Assets and Liabilities.--Section 102(d)(1) of the 
     Ethics in Government Act of 1978 is amended--
       (1) in subparagraph (F) by striking ``and''; and
       (2) by striking subparagraph (G) and inserting the 
     following:
       ``(G) greater than $1,000,000 but not more than $5,000,000;
       ``(H) greater than $5,000,000 but not more than 
     $25,000,000;
       ``(I) greater than $25,000,000 but not more than 
     $50,000,000; and
       ``(J) greater than $50,000,000;
       ``(K) greater than $1,000,000.''
       (C) Exception.--Section 102(e)(1) of the Ethics in 
     Government Act of 1978 is amended by inserting after 
     102(e)(1)(E) the following:
       ``(F) For purposes of this section, categories with amounts 
     or values greater than $1,000,000 shall apply to spouses and 
     dependent children only if the income, asset or liability is 
     held jointly with the reporting individual; all other income 
     and/or liabilities of a spouse or dependent children greater 
     than $1,000,000 shall be categorized as greater than 
     $1,000,000.''

  Mr. FORD. I thank the Chair.
  Mr. McCONNELL addressed the Chair.
  The PRESIDING OFFICER. The Senator from Kentucky.


                      Unanimous-Consent Agreement

  Mr. McCONNELL. Mr. President, I ask unanimous consent that section 6 
be stricken from S. 1060, and when the Senate considers S. 1061, 
section 6 be inserted at the appropriate place.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The assistant legislative clerk proceeded to call the roll.
  Mr. BROWN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                    Amendment No. 1838, as Modified

  Mr. BROWN. Mr. President, with the assistance of the distinguished 
Senator from Kentucky, I believe amendment No. 1838 is modified in a 
way that meets the approval of Members. To refresh Members' memories, 
this amendment deals solely with reporting categories, not the more 
controversial areas of residence or the area of blind trust. This 
amendment deals solely with reporting categories. The modification 
makes it clear that it does not apply the new categories to the assets, 
income or liabilities of dependents or spouses, but only to those of 
the reporting individuals.
  Mr. President, I believe the amendment is at a point where both sides 
have agreed to it.
  The PRESIDING OFFICER. The question is on agreeing to the amendment.
  The amendment (No. 1838), as modified, was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                      Amendment No. 1840 withdrawn

  Mr. BROWN. Mr. President, my second amendment is amendment No. 1840. 
It deals with reporting of residences.
  Mr. President, I have had the opportunity in the last several hours 
to hear from, I believe, close to a majority of my colleagues. It is 
quite clear from those who have spoken to me that there is not support 
in the Chamber for this amendment.
  While I continue to believe that assets of this kind that exceed $1 
million should be reported, it is quite clear--or so it appears--that 
we do not have the votes for this.
  Therefore, I withdraw amendment No. 1840.
  The PRESIDING OFFICER (Mr. DeWine). The amendment is withdrawn.
  So the amendment (No. 1840) was withdrawn.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the 
pending amendment be temporarily set aside.
  The PRESIDING OFFICER. Without objection, the pending amendment will 
be set aside.


                           Amendment No. 1844

  Mr. McCONNELL. Mr. President, I send an amendment to the desk on 
behalf of Mr. Dole and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Kentucky [Mr. McConnell], for Mr. Dole, 
     proposes an amendment numbered 1844.

  Mr. McCONNELL. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:
       At the appropriate place in the bill, insert the following:


     AMENDMENT TO THE FOREIGN AGENTS REGISTRATION ACT (P.L. 75-583)

       Strike section 11 of the Foreign Agents Registration Act of 
     1938, as amended, and insert in lieu thereof the following:

     SEC. 11. REPORTS TO THE CONGRESS.

       The Attorney General shall every six months report to the 
     Congress concerning administration of this Act, including 
     registrations filed pursuant to the Act, and the nature, 
     sources and content of political propaganda disseminated and 
     distributed.

  Mr. McCONNELL. Mr. President, it is my understanding that this 
amendment has been cleared on both sides.
  Mr. LEVIN. We have no objection to the amendment.
  The PRESIDING OFFICER. If there is no further debate, the question is 
on agreeing to the amendment.
  The amendment (No. 1844) was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the 
pending amendment be temporarily set aside.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1845

  (Purpose: To amend section 207 of title 18, United States Code, to 
 prohibit any person serving as the U.S. Trade Representative and the 
   Deputy U.S. Trade Representative from representing or advising a 
 foreign entity at any time after termination of that person's service 
     and to disqualify such a person from serving as a U.S. Trade 
        Representative and the Deputy U.S. Trade Representative)

  Mr. McCONNELL. Mr. President, I send an amendment to the desk on 
behalf of Mr. Dole and ask for its immediate consideration.
  The PRESIDING OFFICER. The clerk will report.
  The legislative clerk read as follows:

       The Senator from Kentucky [Mr. McConnell], for Mr. Dole, 
     proposes an amendment numbered 1845.

  Mr. McCONNELL. Mr. President, I ask unanimous consent that reading of 
the amendment be dispensed with.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The amendment is as follows:

       At the appropriate place, insert the following:

     SEC.  . BAN ON TRADE REPRESENTATIVE REPRESENTING OR ADVISING 
                   FOREIGN ENTITIES.

       (a) Representing After Service.--Section 207(f)(2) of title 
     18, United States Code, is amended by--
       (1) inserting ``or Deputy United States Trade 
     Representative'' after ``is the United States Trade 
     Representative''; and
       (2) striking ``within 3 years'' and inserting ``at any 
     time''.
       ``(b) Limitation on Appointment as United States Trade 
     Representative and Deputy United States Trade 
     Representative.--Section 141(b) of the Trade Act of 1974 (19 

[[Page S10561]]

     U.S.C. 2171(b)) is amended by adding at the end following new 
     paragraph:
       ``(3) Limitation on appointments.--A person who has 
     directly represented, aided, or advised a foreign entity (as 
     defined by section 207(f)(3) of title 18, United States Code) 
     in any trade negotiation, or trade dispute, with the United 
     States may not be appointed as United States Trade 
     Representative or as a Deputy United States Trade 
     Representative.''.
       (c) Effective Date.--The amendments made by this section 
     shall apply with respect to an individual appointed as United 
     States Trade Representative or as a Deputy United States 
     Trade Representative on or after the date of enactment of 
     this Act.

  Mr. McCONNELL. Mr. President, this is the Dole amendment related to 
the U.S. Trade Representative.
  Mr. LEVIN. Mr. President, I understand that this amendment has been 
modified. It is no longer retroactive; it is prospective only, is that 
correct?
  Mr. McCONNELL. That is correct.
  Mr. LEVIN. With that modification, I have no objection. I think it 
might be wise to state, perhaps, what that amendment does provide, 
because it does make a change in terms of the USTR, who can be 
appointed to USTR. I think it would be wise, because it makes a change 
in the revolving door law, that this be stated, albeit briefly.
  Mr. McCONNELL. Mr. President, the first provision says that no one 
shall be appointed to the important post of U.S. Trade Representative, 
or a Deputy U.S. Trade Representative, if that person had in the past 
directly represented a foreign government at a trade dispute or 
negotiation with the United States.
  The second provision says that nobody who served as U.S. Trade 
Representative, or Deputy U.S. Trade Representative, may, after his or 
her employment has ended, represent, aid, or advise any foreign 
government, foreign political party, or foreign business entity with 
the intent to influence a decision of any officer or employee of any 
executive agency.
  I do not know whether the Senator from Michigan would like me to go 
on. I think that basically explains the amendment.
  Mr. DOLE. Mr. President, this amendment has two provisions:
  The first provision says that no one shall be appointed to the 
important posts of U.S. Trade Representative or Deputy U.S. Trade 
Representative if that person had, in the past, directly represented a 
foreign government in a trade dispute or negotiation with the United 
States.
  The second provision says that no one who has served as U.S. Trade 
Representative or Deputy U.S. Trade Representative may, after his or 
her employment has ended, represent, aid, or advise any foreign 
government, foreign political party, or foreign business entity with 
the intent to influence a decision of any officer or employee of any 
executive agency; 18 U.S.C. section 207(f)(2) currently prohibits the 
U.S. Trade Representative from aiding and advising a foreign entity for 
a period of 3 years after his service has ended. My amendment 
transforms this 3-year ban into a lifetime ban and applies the ban to 
the Deputy Trade Representative as well.
  Of course, there are many fine men and women
   who have served America as our trade representatives. My amendment 
should not be misconstrued as an effort to impugn their integrity in 
any way whatsoever.

  The real problem here is one of appearance--the appearance of a 
revolving door between Government service and private-sector 
enrichment. This appearance problem becomes all the more acute when 
former high Government officials work on behalf of foreign interests.
  That is why my amendment insists that if you have represented the 
United States as one of its most senior trade officials in sensitive 
trade negotiations, you should not now--not 3 years from now, not 
ever--represent a foreign government or foreign business before the 
Government of the United States.
  Service as a high Government officials is a privilege, not a right. 
This amendment may discourage some individuals from accepting the 
U.S.T.R. job, but in may view, this is a small price to pay when the 
confidence of the American people is at stake.
  The PRESIDING OFFICER. Is there further debate?
  If not, without objection, the amendment is agreed to.
  So the amendment (No. 1845) was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.


                           Amendment No. 1841

  Mr. BROWN. Mr. President, I believe my amendment No. 1841 is the 
pending business?
  The PRESIDING OFFICER. The Senator is correct.
  Mr. BROWN. Mr. President, it is my understanding that there is 
disagreement by Members on this amendment.
  To refresh the memory of others, this is the amendment that would 
allow for the total assets of a trust to be reported on the disclosure 
form, in the event that the Member is advised under the trust 
instrument of what the total cash value of those assets are. Right now, 
Members do report income from their blind trust. They do not, however, 
report the total cash value of that blind trust, even though our form 
of a qualified blind trust does report that to the Member.
  So this amendment removes a loophole. It would provide for reporting 
of the total cash value. That clearly does not include the underlying 
assets, but it includes the total cash value of all the assets, only in 
the case that the trust instrument provides for that to be reported to 
the individual.
  Mr. President, there is disagreement on this. I, therefore, ask for 
the yeas and nays on this amendment.
  The PRESIDING OFFICER. Is there a sufficient second?
  There is a sufficient second.
  The yeas and nays were ordered.
  Mr. LAUTENBERG. Mr. President, I have discussed this amendment with 
the distinguished Senator from Colorado, and I have expressed some 
reservation about it, because what we are doing here is really amending 
the structure of the blind trust--understanding that it has been in 
existence here--that permits Members to disassociate the management of 
assets from their activities here and thereby not involving any 
opportunity for conflict. It serves a purpose. It has been on the books 
for some time now as part of the responsibilities of disclosure of 
Senators.
  Frankly, I think this is a rather back-door attempt to place this now 
in front of the public without full consideration. I think there ought 
to have been hearings about this to see what the Finance Committee or 
the Judiciary Committee has to say about the value of this instrument 
as an opportunity to serve, without having to look back over one's 
shoulder, about whether or not they are making a decision that may in 
fact present a conflict.
  I heard very clearly what the Senator said. All this does is talk 
about the value. Well, right now, that value may or may not be known 
but, likely, in an accountant's report, it is to be known for the value 
of doing one's estate planning, financial planning, children, other 
beneficiaries, in terms of where one would like to see the assets 
perhaps testamentally go. But now what we are saying is, OK, whether 
you obtain your assets through inheritance, hard work under the 
opportunities afforded in our country, the accumulation of assets now 
begins to look like it is somehow or other a stigma on one's ability.
  What we are going to do is continue to denigrate the interest in 
serving by exposing families to public review, by encouraging those who 
seek to gain other people's assets, by either criminal or illegal 
means--and that is the purpose of having some protection.
  I assume that the Senator says that ``OK, what we ought to do is make 
sure that anybody who has acquired assets, no matter how hard they 
worked for it, no matter how ingenious they have been in creating it, 
they ought to present it willy-nilly out there for public scrutiny.''
  We now, Mr. President, have categories of assets. I understand that 
one of those, if I am correct, and I ask the Chair to be sure that what 
I am saying is accurate, one of those has just been modified so that we 
now have new levels of reporting assets that we did not have before.
  Is that true, Mr. President?
  The PRESIDING OFFICER. The Chair cannot comment on the substance of 
the amendment.
  Mr. BROWN. Mr. President, will the Senator yield?
  
[[Page S10562]]

  Mr. LAUTENBERG. I yield to the Senator.
  Mr. BROWN. The Senator is correct, the amendment just accepted adds 
categories to the existing law, which stops at greater than $1 million. 
The additional categories apply only to a Member's personal or joint 
assets.
  Mr. LAUTENBERG. Mr. President, I suggest that the Senator further 
modify it to say, ``Let's put your checkbook on the table, put your 
bank account out there so the public can see,'' and see what your bill 
paying process has been to make sure that the assets you choose to 
acquire are subject to public scrutiny.
  This is a subterfuge of some kind. I cannot quite figure it out. 
Obviously, it is designed to either embarrass or stigmatize that which 
has been a legitimate practice here, and that is to say there are 
categories of assets that indicate in general terms what it is that 
these assets represent.
  Now we are getting down to the nitty-gritty and perhaps we will 
eventually ask for weekly income or such things. The Senate has 
accepted it, Mr. President. I am sorry to see that we are, as we 
discuss lobbying reform, now into this kind of amendment.
  I wish it had been offered. I might very well support it. I object to 
it as I hear it, because I have not had a chance to see it examined 
fully, to see whether it is an appropriate process, one that we adopted 
some time ago, and have been following fairly scrupulously.
  Mr. President, I hope that this amendment will be defeated so it can 
be deferred and discussed at length in the appropriate committees, as 
opposed to tacking this on to the lobbying reform bill.
  I also have an amendment, Mr. President, which I believe is listed in 
the category of amendments to be considered. I yield the floor.
  Mr. BROWN. Mr. President, the measure before the Senate does not 
change the underlying statute. Under the statute, a beneficiary can 
receive certain information. In subparagraph 5:

       Interested parties shall not receive any report on the 
     holding and sources of income of the trust except a report at 
     the end of each calendar quarter with respect to the total 
     cash value of each of the interested parties in trust, or the 
     net income or loss of the trust or any reports necessary to 
     enable interested parties to complete individual tax returns.

  It goes on. My amendment does not change what makes up a blind trust. 
What it does do is close a loophole. In the past, Members with a 
qualified blind trust received a report on their income and reported 
that income.
  But Members who have a qualified blind trust and receive a report on 
the total cash value do not have to report the total cash value.
  My amendment does not change the qualified blind trust, but it does 
change what we report. It provides for the closing of the loophole. It 
does not require the disclosure of the individual assets in the blind 
trust. Obviously, those are not supposed to be disclosed to the people 
involved. It does however, require the disclosure of what is reported 
to the beneficiaries; that is, their total cash value. This has been on 
the books for some time.
  Let me deal with another aspect. In my view, my amendment in no way 
is meant to cast a stigma about the abilities of anyone associated with 
the blind trust. I think people who work hard and save the money have a 
right to be proud of that. It is an achievement. It is not something 
that casts any stigma on them. This amendment is not offered in that 
light. It is offered in a belief that disclosure should be consistent 
and there should not be loopholes to shelter very large assets, and 
full disclosure for those with lesser assets.
  The fact that you can afford an independent trustee should not be 
used as a measure for exempting you from disclosure. Disclosure ought 
to be applied both to those who cannot afford an independent trustee 
and those who can afford an independent trustee. I yield the floor.
  Mr. LEVIN. Mr. President, I suggest the absence of a quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. BROWN. Mr. President, I ask unanimous consent that the order for 
the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.


                           Amendment No. 1841

  Mr. BROWN. Mr. President, I understand the leaders have reached an 
agreement on the Brown amendment, 1841. I ask unanimous consent to 
withdraw my request for a record vote.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  If there be no further debate, the question is on agreeing to the 
amendment.
  The amendment (No. 1841) was agreed to.
  Mr. McCONNELL. Mr. President, I move to reconsider the vote.
  Mr. LEVIN. I move to lay that motion on the table.
  The motion to lay on the table was agreed to.
  The PRESIDING OFFICER. The Senator from Kentucky.


                           Amendment No. 1845

  Mr. McCONNELL. Mr. President, I ask unanimous consent that Senator 
McCain be added as a cosponsor of the Dole U.S. Trade Representative 
amendment approved earlier tonight.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  Mr. McCONNELL. Mr. President, we will have a unanimous-consent 
agreement shortly. It is being typed. So, I suggest the absence of a 
quorum.
  The PRESIDING OFFICER. The clerk will call the roll.
  The legislative clerk proceeded to call the roll.
  Mr. McCONNELL. Mr. President, I ask unanimous consent that the order 
for the quorum call be rescinded.
  The PRESIDING OFFICER. Without objection, it is so ordered.

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