Report text available as:

  • TXT
  • PDF   (PDF provides a complete and accurate display of this text.) Tip ?
[From the U.S. Government Publishing Office]


 114th Congress    }    HOUSE OF REPRESENTATIVES   {    Rept. 114-362
 1st Session       }                               {           Part 1

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



 
  TERMINATION OF TAXPAYER FINANCING OF PRESIDENTIAL ELECTION CAMPAIGNS

                                _______
                                

                December 3, 2015.--Ordered to be printed

                                _______
                                

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

                              R E P O R T

                        [To accompany H.R. 412]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on House Administration, to whom was referred 
the bill (H.R. 412) to reduce Federal spending and the deficit 
by terminating taxpayer financing of presidential election 
campaigns, having considered the same, report favorably thereon 
without amendment and recommend that the bill do pass.

                          Purpose and Summary

    H.R. 412 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 $18 trillion. 
Eliminating the PECF will have little impact on Presidential 
campaigns, as credible major party politicians have ceased 
using it. The PECF is an idea whose time has passed. H.R. 412 
would eliminate the PECF and transfer $88,202,400 to the 10-
Year Pediatric Research Initiative while transferring the 
remainder to the general fund of the Treasury, to be used only 
for reducing the deficit.

                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 to participate. 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 two components: the primary matching 
funds and general election grants. Each of these components is 
an inefficient use of taxpayer dollars.
    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. Following 
President Obama's rejection of the PECF general election grant 
in 2008, he again rejected general election grants in 2012. 
Mitt Romney, the Republican nominee, also rejected general 
election grants in 2012. Politicians themselves are rejecting 
the PECF.
    H.R. 412 would transfer $88,202,400 to the 10-Year 
Pediatric Research Initiative. The 10-Year Pediatric Research 
Initiative, described under 42 U.S. Code 284h, provides for 
research funds to fight and to find a cure for childhood 
diseases. The remainder of the account balance, roughly $170 
million, would be transferred to the Treasury to be used for 
paying down our country's $18 trillion debt. H.R. 412 reflects 
congressional priorities of funding research to end childhood 
diseases and paying down our debt over funding a little used 
campaign fund.

                               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 such as the 10-Year 
Pediatric Research Initiative and paying down the national 
debt.

                       Introduction and Referral

    On January 20, 2015, Congressman Tom Cole of Oklahoma 
introduced H.R. 412, 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. 412.

                        Committee Consideration

    On March 2, 2015, the Committee on House Administration met 
to consider H.R. 412. 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. 412.

            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:

                                     U.S. Congress,
                               Congressional Budget Office,
                                    Washington, DC, March 13, 2015.
 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. 412, a bill to 
reduce federal spending and the deficit by terminating taxpayer 
financing of Presidential election campaigns.
     If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Matthew 
Pickford.
             Sincerely,
                                        Robert A. Sunshine,
                                            (Douglas W. Elmendorf).
     Enclosure.

 H.R. 412--A bill to reduce federal spending and the deficit by 
        terminating taxpayer financing of Presidential election 
        campaigns

     Summary: H.R. 412 would amend federal law to eliminate the 
Presidential Election Campaign Fund (PECF). Specifically, the 
bill would:
           End taxpayers' option to designate a portion 
        of their federal income tax to be credited to the PECF;
           Eliminate the authority to spend balances in 
        the PECF on Presidential campaigns; and
           Transfer a portion of the remaining balances 
        in the PECF to the 10-Year Pediatric Research 
        Initiative Fund and the remainder to the general fund 
        of the Treasury.
    CBO estimates that implementing H.R. 412 would cost $88 
million over the 2016-2025 period, assuming appropriation of 
amounts specified to be transferred to the 10-year Pediatric 
Research Initiative. In addition, we estimate that enacting 
H.R. 412 would reduce direct spending by $6 million over the 
2016-2025 period, by ending the authority to spend federal 
funds on Presidential campaigns. Because the bill would affect 
direct spending, pay-as-you-go procedures apply.
    The staff of the Joint Committee on Taxation (JCT) has 
determined that H.R. 412 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 effects of H.R. 412 are shown in the following table. 
The effects of this legislation fall within budget functions 
550 (health) and 800 (general government).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                             By fiscal year, in millions of dollars--
                                         ---------------------------------------------------------------------------------------------------------------
                                            2016     2017     2018     2019     2020     2021     2022     2023     2024     2025   2016-2020  2016-2025
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING
 
 Estimated Budget Authority.............      -31      -29      -28      -27      -26      -24      -23      -22      -21      -20      -141       -251
Estimated Outlays.......................       -2        0        0        0       -2        0        0        0       -2        0        -4         -6
 
                                                       CHANGES IN SPENDING SUBJECT TO APPROPRIATION
 
 Estimated Authorization Level..........       88        0        0        0        0        0        0        0        0        0        88         88
 Estimated Outlays......................       23       48       13        2        1        *        0        0        0        0        88         88
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: * = Less than $500,000.

     Basis of estimate: For this estimate, CBO assumes that the 
legislation will be enacted before the end of fiscal year 2015.

 Direct spending and revenues

    The PECF may provide 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 fimd for 
campaigns has gradually diminished in recent years, and the 
amounts credited to the fund have also declined.
    Currently the fund has a balance of about $270 million. 
During the most recent Presidential campaign, spending from the 
PECF totaled about $37 million--$36 million of that amount went 
toward conventions organized by the two major political 
parties. In 2014, enactment of the Gabriella Miller Kids First 
Research Act ended the authority to spend balances in the PECF 
for political conventions. Furthermore, the two major party 
candidates in 2012 did not accept any PECF money for their 
campaigns; other candidates received a total of about $1 
million for their campaigns in 2012.
    CBO estimates that under current law, taxpayers will 
designate an average of about $25 million for the PECF per year 
over the 2015-2025 period, but that spending from the fund will 
amount to only $2 million during each Presidential campaign. 
That estimate is based on the expectation that the amount of 
public funding political parties will request for campaign 
costs related to upcoming Presidential elections will be 
similar to spending over the past two Presidential election 
cycles, when the major party candidates did not accept PECF 
money for their campaigns. Hence, CBO estimates that 
terminating the PEFC would reduce direct spending by $6 million 
over the 2016-2025 period.

 Spending subject to appropriation

     H.R. 412 would transfer $88 million from the PECF to the 
10-Year Pediatric Research Initiative Fund. Assuming the 
appropriation of that specified amount, CBO estimates that 
spending for research activities would total $88 million over 
the 2016-2025 period, with most of that spending occurring in 
the next few years.
     Eliminating the PECF would reduce the administrative costs 
that the Federal Election Commission incurs to oversee the use 
of the fund during Presidential election campaign cycles. Those 
administrative costs are subject to the availability of 
appropriated funds. However, because the fund has been used 
much less frequently in recent years, CBO expects that any such 
savings would be insignificant.
     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.

            CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 412, AS ORDERED REPORTED BY THE COMMITTEE ON HOUSE ADMINISTRATION ON MARCH 4, 2015
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                           By fiscal year, in millions of dollars--
                                    --------------------------------------------------------------------------------------------------------------------
                                                                                                                                         2015-    2015-
                                       2015     2016     2017     2018     2019     2020     2021     2022     2023     2024     2025     2020     2025
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             NET DECREASE (-) IN THE DEFICIT
 
 Statutory Pay-As-You-Go Impact....        0       -2        0        0        0       -2        0        0        0       -2        0       -4       -6
--------------------------------------------------------------------------------------------------------------------------------------------------------

     Intergovernmental and Private-sector impact: JCT has 
determined that H.R. 412 contains no intergovernmental or 
private-sector mandates as defined in UMRA.
     Estimate prepared by: Federal Spending: Jamease Miles and 
Matthew Pickford; Intergovernmental and Private-Sector 
Mandates: Staff of the 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. 412 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. 412 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) In General.--Every individual (other than a nonresident 
alien) whose income tax liability for the taxable year is $3 or 
more may designate that $3 shall be paid over to the 
Presidential Election Campaign Fund in accordance with the 
provisions of section 9006(a). In the case of a joint return of 
husband and wife having an income tax liability of $6 or more, 
each spouse may designate that $3 shall be paid to the fund.
  (b) Income Tax Liability.--For purposes of subsection (a), 
the income tax liability of an individual for any taxable year 
is the amount of the tax imposed by chapter 1 on such 
individual for such taxable year (as shown on his return), 
reduced by the sum of the credits (as shown in his return) 
allowable under part IV of subchapter A of chapter 1 (other 
than subpart C thereof).
  (c) Manner and Time of Designation.--A designation under 
subsection (a) may be made with respect to any taxable year--
          (1) at the time of filing the return of the tax 
        imposed by chapter 1 for such taxable year, or
          (2) at any other time (after the time of filing the 
        return of the tax imposed by chapter 1 for such taxable 
        year) specified in regulations prescribed by the 
        Secretary.
Such designation shall be made in such manner as the Secretary 
prescribes by regulations except that, if such designation is 
made at the time of filing the return of the tax imposed by 
chapter 1 for such taxable year, such designation shall be made 
either on the first page of the return or on the page bearing 
the taxpayer's signature.
  (d) Termination.--This section shall not apply to taxable 
years beginning after December 31, 2014.

           *       *       *       *       *       *       *


Subtitle H--Financing of Presidential Election Campaigns

           *       *       *       *       *       *       *


            CHAPTER 95--PRESIDENTIAL ELECTION CAMPAIGN FUND

Sec. 9001. Short title.
     * * * * * * *
Sec. 9014. Termination.

           *       *       *       *       *       *       *


SEC. 9006. PAYMENTS TO ELIGIBLE CANDIDATES.

  (a) Establishment of Campaign Fund.--There is hereby 
established on the books of the Treasury of the United States a 
special fund to be known as the ``Presidential Election 
Campaign Fund''. The Secretary of the Treasury shall, from time 
to time, transfer to the fund an amount not in excess of the 
sum of the amounts designated (subsequent to the previous 
Presidential election) to the fund by individuals under section 
6096. There is appropriated to the fund for each fiscal year, 
out of amounts in the general fund of the Treasury not 
otherwise appropriated, an amount equal to the amounts so 
designated during each fiscal year, which shall remain 
available to the fund without fiscal year limitation.
  (b) Payments from the Fund.--Upon receipt of a certification 
from the Commission under section 9005 for payment to the 
eligible candidates of a political party, the Secretary of the 
Treasury shall pay to such candidates out of the fund the 
amount certified by the Commission. Amounts paid to any such 
candidates shall be under the control of such candidates.
  (c) Insufficient Amounts in Fund.--If at the time of a 
certification by the Commission under section 9005 for payment 
to the eligible candidates of a political party, the Secretary 
determines that the moneys in the fund are not, or may not be, 
sufficient to satisfy the full entitlements of the eligible 
candidates of all political parties, he shall withhold from 
such payment such amount as he determines to be necessary to 
assure that the eligible candidates of each political party 
will receive their pro rata share of their full entitlement. 
Amounts withheld by reason of the preceding sentence shall be 
paid when the Secretary determines that there are sufficient 
moneys in the fund to pay such amounts, or portions thereof, to 
all eligible candidates from whom amounts have been withheld, 
but, if there are not sufficient moneys in the fund to satisfy 
the full entitlement of the eligible candidates of all 
political parties, the amounts so withheld shall be paid in 
such manner that the eligible candidates of each political 
party receive their pro rata share of their full entitlement. 
In any case in which the Secretary determines that there are 
insufficient moneys in the fund to make payments under 
subsection (b), section 9008(i)(2), and section 9037(b), moneys 
shall not be made available from any other source for the 
purpose of making such payments.
  (d) Transfer of Funds Remaining After Termination.--Of the 
amounts in the fund as of the date of the enactment of this 
subsection--
          (1) the Secretary shall transfer $88,202,400 to the 
        10-Year Pediatric Research Initiative Fund described in 
        section 9008(i)(2), to be available as described in 
        such section; and
          (2) the Secretary shall transfer the remainder 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. 9031. Short title.
     * * * * * * *
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.

           *       *       *       *       *       *       *


                                  [all]