[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.