H. Rept. 113-292 - 113th Congress (2013-2014)

Report text available as:

Formatting necessary for an accurate reading of this legislative text may be shown by tags (e.g., <DELETED> or <BOLD>) or may be missing from this TXT display. For complete and accurate display of this text, see the PDF.


House Report 113-292 - TO REDUCE FEDERAL SPENDING AND THE DEFICIT BY TERMINATING TAXPAYER FINANCING OF PRESIDENTIAL ELECTION CAMPAIGNS AND PARTY CONVENTIONS

[House Report 113-292]
[From the U.S. Government Publishing Office]


113th Congress                                            Rept. 113-292
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

======================================================================

 
  TO REDUCE FEDERAL SPENDING AND THE DEFICIT BY TERMINATING TAXPAYER 
   FINANCING OF PRESIDENTIAL ELECTION CAMPAIGNS AND PARTY CONVENTIONS

                                _______
                                

               December 12, 2013.--Ordered to be printed

                                _______
                                

 Mrs. Miller of Michigan, from the Committee on House Administration, 
                        submitted the following

                              R E P O R T

                             together with

                             MINORITY VIEWS

                         [To accompany H.R. 95]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on House Administration, to whom was referred 
the bill (H.R. 95) to reduce Federal spending and the deficit 
by terminating taxpayer financing of presidential election 
campaigns and party conventions, having considered the same, 
report favorably thereon without amendment and recommend that 
the bill do pass.

                          Purpose and Summary

    H.R. 95 eliminates the Presidential Election Campaign Fund 
(PECF). The PECF is an inefficient and wasteful use of taxpayer 
dollars at a time when the national debt exceeds $16 trillion. 
Eliminating the PECF will have little impact on Presidential 
campaigns, as credible major party politicians have ceased 
using it. Taxpayers would no longer fund the elaborate party 
nominating conventions where millions of dollars of taxpayer 
money is spent on building elaborate stages, providing catering 
for politicians, and giving gift bags away to attendees. The 
PECF is an idea whose time has passed. H.R. 95 would eliminate 
the wasteful spending of the PECF and return the remaining 
balance to the taxpayer while avoiding greater deficits in the 
future.

                Background and Need for the Legislation

    In 1976, the Presidential Election Campaign Fund (PECF) was 
first used in a Presidential Election Campaign. Continuing from 
1976 to 2008, every major party's nominee for President 
participated in some form in the PECF. Starting in 2008, Barack 
Obama was the first major party Presidential nominee to decline 
general election funding. In 2012, neither major party's 
nominee accepted PECF funding for the general election.
    The American people have rejected the idea of contributing 
to taxpayer-financed elections. In 1980, approximately 28.7% of 
taxpayers participated in the voluntary tax checkoff system 
that funds the PECF. By 2012, the number participating in the 
voluntary tax checkoff system had dwindled to only 5.1% of 
taxpayers. The decline in support occurred despite taxpayers 
having absolutely no difference in their tax liability if the 
taxpayer elected the checkoff. Each year the American people 
evaluate whether to fund the PECF and each year fewer and fewer 
Americans elect to participate in PECF.
    The PECF consists of three components: the primary matching 
funds, general election grants, and party nominating convention 
funding. Each of these components is an inefficient use of 
taxpayer dollars.
    Party nominating conventions received approximately $36 
million last year (evenly split) from taxpayers to put on the 
elaborate affairs to officially nominate a party's nominee. 
This money comes in addition to the money that parties have 
raised from individual and corporate donors. H.R. 95 would 
eliminate the taxpayer subsidy for the nominating conventions 
and force political parties to raise from individual and 
corporate donors the totality of any money they wish to spend 
on party nominating conventions.
    The PECF election grants, both primary and general, have 
seen little use by successful candidates in recent years. Major 
party candidates avoid taking primary matching funds because 
doing so would be a death knell for their candidacy. Since 
President Obama's rejection of the PECF general election grant 
in 2008, he again rejected general election grants. Mitt 
Romney, the Republican nominee, also rejected general election 
grants. Politicians are also rejecting using the PECF.

                               Conclusion

    Since taxpayers and politicians are already rejecting the 
PECF, the PECF should be eliminated and the taxpayer funds 
diverted to be used for other programs.

                       Introduction and Referral

    On January 3, 2013, Congressman Tom Cole of Oklahoma 
introduced H.R. 95, which was referred to the Committee on Ways 
and Means, in addition to the Committee on House 
Administration.

                                Hearings

    There were no legislative hearings held on H.R. 95.

                        Committee Consideration

    On June 4, 2013, the Committee on House Administration met 
to consider H.R. 95. The Committee ordered the bill reported 
favorably to the House without amendment by voice vote with a 
quorum present.

                         Committee Record Votes

    In compliance with House Rule XIII, clause 3(b), requiring 
the results of each record vote on an amendment or motion to 
report, together with the names of those voting for and 
against, to be printed in the Committee report, the Committee 
states that there were no record votes during the Committee's 
consideration of H.R. 95.

            Committee Oversight Findings and Recommendations

    In compliance with House Rule XIII, clause 3(c)(1), the 
Committee states that the findings and recommendations of the 
Committee, based on oversight activities under House Rule X, 
clause 2(b)(1), are incorporated into the general discussion 
section of this report.

            Statement of Budget Authority and Related Items

    The bill does not provide new budget authority, new 
spending authority, new credit authority, or an increase or 
decrease in revenues or tax expenditures and a statement under 
House Rule XIII, clause 3(c)(2), and section 308(a)(1) of the 
Congressional Budget Act of 1974 is not required.

               Congressional Budget Office Cost Estimate

    Pursuant to clause 3(c)(3) of rule XIII of the Rules of the 
House of Representatives, the following is the cost estimate 
provided by the Congressional Budget Office pursuant to section 
402 of the Congressional Budget Act of 1974:

                                                     June 21, 2013.
Hon. Candice Miller,
Chairman, Committee on House Administration,
House of Representatives, Washington, DC.
    Dear Madam Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 95, a bill to 
reduce federal spending and the deficit by terminating taxpayer 
financing of Presidential election campaigns and party 
conventions.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contacts are Maggie 
Morrissey and Matthew Pickford.
            Sincerely,
                                              Douglas W. Elmendorf.
            Enclosure.

H.R. 95--A bill to reduce federal spending and the deficit by 
        terminating taxpayer financing of Presidential election 
        campaigns and party conventions

    Summary: H.R. 95 would amend federal law to end taxpayers' 
option to designate a portion of their federal income tax to 
the Presidential Election Campaign Fund (PECF); the bill would 
end authority to spend such funds on Presidential campaigns and 
transfer all balances in that fund to the general fund of the 
Treasury. CBO estimates that enacting H.R. 95 would reduce 
direct spending by $130 million over the 2014-2023 period. In 
addition, the legislation would affect federal penalties 
related to campaign financing (some of which are recorded in 
the budget as revenues and are available to be spent without 
further appropriation); CBO estimates, however, that any such 
effects would not be significant. Because the bill would affect 
direct spending and revenues, pay-as-you-go procedures apply. 
The staff of the Joint Committee on Taxation (JCT) estimates 
that enacting the legislation would have no impact on federal 
income tax revenues.
    JCT has determined that H.R. 95 contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of H.R. 95 is shown in the following table. 
The costs of this legislation fall within budget function 800 
(general government).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 By fiscal year, in millions of dollars----
                                                   -----------------------------------------------------------------------------------------------------
                                                     2014    2015    2016    2017    2018    2019    2020    2021    2022    2023   2014-2018  2014-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority........................     -34     -33     -32     -31     -30     -29     -28     -27     -26     -25       -160       -295
Estimated Outlays.................................       0     -40      -2       0       0     -42      -2       0       0     -44        -42       -130
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: For this estimate, CBO assumes that the 
legislation will be enacted before the end of 2013. We estimate 
that enacting the bill would reduce direct spending but would 
have no significant effect on revenues (including penalties).
    The PECF provides money for Presidential election 
campaigns. The fund is financed by taxpayers who voluntarily 
designate on their income tax returns that a portion of their 
annual tax liability ($3 for individual income tax filers and 
$6 for joint returns) be credited to the PECF. The voluntary 
earmarking of a portion of a taxpayer's liability does not 
affect the amount of tax owed to the federal government or the 
amount of any refund owed to that taxpayer. Use of the fund has 
gradually diminished in recent years along with the amounts 
credited to the fund. In 2012, $35 million was credited to the 
fund. During the most recent Presidential campaign, spending 
from the PECF totaled about $37 million-$36 million of that 
amount went toward political conventions organized by the two 
major political parties. The two major party candidates did not 
accept any PECF funds for their campaigns; other candidates 
received a little more than $1 million for their campaigns.
    CBO estimates that terminating the PECF would reduce direct 
spending by $130 million over the 2014-2023 period. That 
estimate is based on PECF spending over the last two 
Presidential election cycles and reflects CBO's assumptions 
about the number of taxpayers that would likely designate funds 
for the PECF over the 2014-2023 period and the amount of public 
funding that we expect the major political parties to request 
for costs related to upcoming Presidential elections.
    Eliminating the PECF could reduce the administrative costs 
that the Federal Election Commission incurs to oversee the use 
of amounts drawn from that fund during Presidential election 
campaign cycles. However, because of the diminished use of the 
funds in recent years, CBO expects any such savings would be 
insignificant.
    Enacting H.R. 95 could affect federal revenues by 
decreasing the collection of fines for violating campaign 
finance law. Such collections are recorded in the budget as 
revenues and, in certain cases, such amounts may be spent 
without further appropriation. CBO estimates that any net 
changes in revenues and associated direct spending would be 
insignificant because of the small number of possible 
violations.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The changes in outlays that are subject to those pay-
as-you-go procedures are shown in the following table. Enacting 
the legislation would have no significant effect on revenues 
(including penalties).

             CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 95, AS ORDERED REPORTED BY THE COMMITTEE ON HOUSE ADMINISTRATION ON JUNE 4, 2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                 By fiscal year, in millions of dollars--
                                                 -------------------------------------------------------------------------------------------------------
                                                   2013   2014   2015    2016    2017   2018   2019    2020    2021   2022   2023   2013-2018  2013-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                 NET INCREASE OR DECREASE (-) IN THE [ON-BUDGET] DEFICIT

Statutory Pay-As-You-Go Impact..................      0      0     -40      -2      0      0     -42      -2      0      0     -44       -42       -130
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Intergovernmental and private-sector impact: JCT has 
determined that H.R. 95 contains no intergovernmental or 
private-sector mandates as defined in the Unfunded Mandates 
Reform Act.
    Previous CBO estimate: On May 17, 2013, CBO transmitted a 
cost estimate for H.R. 2019, the Kids First Research Act of 
2013, as introduced on May 16, 2013. That bill also would 
eliminate the PECF and end the authority to spend funds in that 
account on Presidential campaigns or conventions, and our 
estimates of savings stemming from such changes under both 
bills are the same.
    Estimate prepared by: Federal Spending: Maggie Morrissey 
and Matthew Pickford: Impact on Intergovernmental and Private-
Sector Mandates: Joint Committee on Taxation.
    Estimate approved by: Theresa Gullo, Deputy Assistant 
Director for Budget Analysis.

                    Performance Goals and Objectives

    In compliance with House Rule XIII, clause 3(c)(4), the 
Committee states that the general discussion section of this 
report includes a statement of the general performance goals 
and objectives, including outcome-related goals and objectives, 
for which H.R. 95 authorizes funding.

                   Constitutional Authority Statement

    Congress has the power to enact this legislation pursuant 
to Amendment XVI of the U.S. Constitution relating to the 
collection of income tax and additionally to Article I, Section 
4 of the U.S. Constitution granting Congress the authority to 
make laws governing the time, place and manner of holding 
Federal elections.

                          Advisory on Earmarks

    In accordance with House Rule XXI, clause 9, the Committee 
states that H.R. 95 does not contain any congressional 
earmarks, limited tax benefits, or limited tariff benefits as 
defined in clause 9(e), 9(f), or 9(g) of rule XXI.

         Changes in Existing Law Made by the Bill, as Reported

  In compliance with clause 3(e) of rule XIII of the Rules of 
the House of Representatives, changes in existing law made by 
the bill, as reported, are shown as follows (new matter is 
printed in italic and existing law in which no change is 
proposed is shown in roman):

INTERNAL REVENUE CODE OF 1986

           *       *       *       *       *       *       *



Subtitle F--Procedure and Administration

           *       *       *       *       *       *       *


CHAPTER 61--INFORMATION AND RETURNS

           *       *       *       *       *       *       *


Subchapter A--Returns and Records

           *       *       *       *       *       *       *


PART VIII--DESIGNATION OF INCOME TAX PAYMENTS TO PRESIDENTIAL ELECTION 
CAMPAIGN FUND

           *       *       *       *       *       *       *



SEC. 6096. DESIGNATION BY INDIVIDUALS.

  (a) * * *

           *       *       *       *       *       *       *

  (d) Termination.--This section shall not apply to taxable 
years beginning after December 31, 2011.

           *       *       *       *       *       *       *


Subtitle H--Financing of Presidential Election Campaigns

           *       *       *       *       *       *       *


            CHAPTER 95--PRESIDENTIAL ELECTION CAMPAIGN FUND

     * * * * * * *
Sec. 9014. Termination.

           *       *       *       *       *       *       *


SEC. 9006. PAYMENTS TO ELIGIBLE CANDIDATES.

  (a) * * *

           *       *       *       *       *       *       *

  (d) Transfer of Funds Remaining After Termination.--The 
Secretary shall transfer all amounts in the fund after the date 
of the enactment of this section to the general fund of the 
Treasury, to be used only for reducing the deficit.

           *       *       *       *       *       *       *


SEC. 9014. TERMINATION.

  The provisions of this chapter shall not apply with respect 
to any presidential election (or any presidential nominating 
convention) after the date of the enactment of this section, or 
to any candidate in such an election.

       CHAPTER 96--PRESIDENTIAL PRIMARY MATCHING PAYMENT ACCOUNT

     * * * * * * *
Sec. 9043. Termination.

           *       *       *       *       *       *       *


SEC. 9043. TERMINATION.

  The provisions of this chapter shall not apply to any 
candidate with respect to any presidential election after the 
date of the enactment of this section.

           *       *       *       *       *       *       *


MINORITY VIEWS OF RANKING MEMBER ROBERT A. BRADY, REP. ZOE LOFGREN AND 
                            REP. JUAN VARGAS

    We oppose H.R. 95 in its current form as we did in all of 
its previous iterations. The campaign-funding function of the 
Presidential Election Campaign Fund has been a very popular 
option for qualifying candidates. Since the funds' inception in 
1976, every major party nominee opted for public funding except 
Democratic nominee Barack Obama in 2008 while Republican 
nominee John McCain accepted public funding that year. The 2012 
presidential election marked the first time neither major party 
nominee opted for public financing. The advent of the Internet 
for fundraising purposes particularly the ease in which a 
candidate can receive many small dollar contributions has 
significantly undermined the convenience of the ''check off'' 
mechanism of the PECF. This is not to say, however, that the 
PECF itself has outlived its usefulness.
    The PECF is the only public campaign funding system that 
exists at the federal level and qualified candidates that use 
it are barred from raising any other funds during the general 
election. Since the SpeechNow and Citizens United decisions, a 
tidal wave of secret unlimited dollars have inundated our 
elections and drowned out the voices of those that are less 
fortunate. By preserving and modernizing the PECF to make it a 
more viable option for qualified candidates, we can ensure that 
campaigns are financed by taxpayers so candidates are not 
indebted to well-heeled special interests. Terminating public 
financing puts our democracy up for sale. Our goal as a 
Congress should be to eliminate any outside influence that 
jeopardizes the duty elected officials owe to the public, not 
to make it easier for money to influence decision-making. 
Unfortunately, that is all this bill accomplishes.
    Because presidential election years see a dramatic increase 
in turnout compared to midterm elections, the Democrats of the 
Committee on House Administration offered an amendment to H.R. 
94 that would have reserved a small portion of the PECF balance 
for the Election Assistance Commission (EAC) to improve 
election administration in presidential election years on 
behalf of military members, elderly voters, and disabled 
voters. This amendment was unfortunately rejected by the 
Committee on House Administration Republicans.
                                   Robert A. Brady.
                                   Zoe Lofgren.
                                   Juan Vargas.