TRANSFER AND REDEMPTION OF VOUCHERS

SEC. 3. (a) An individual who has been furnished a congressional election campaign voucher under section 6096 of the Internal Revenue Code of 1954 may transfer such voucher, without consideration, to (A) any qualified candidate for election to the Senate or the House of Representatives of the United States, or (B) any qualified committee designated by any such qualified candidate.

(b) An individual who has been furnished a presidential election campaign voucher under section 6096 of the Internal Revenue Code of 1954 may transfer such voucher, without consideration, to (A) any qualified candidate for election to the office of President or Vice President of the United States, or (B) any qualified committee designated by any such qualified candidate.

(c) A qualified candidate or qualified committee to which a congressional election campaign voucher or presidential election campaign voucher, as the case may be, is transferred under subsection (a) or (b) may, subject to the provisions of subsection (d), present such voucher to the Secretary of the Treasury for redemption. The Secretary shall pay to such qualified candidate or qualified committee $1 for each voucher so presented for redemption.

(d) A congressional election campaign voucher or presidential election campaign voucher may be redeemed under subsection (c) only if it is presented for redemption

(1) on or after September 1 and on or before November 30 of the year which it is issued, and

(2) at such time and place as the Secretary of the Treasury prescribes by regulations.

(e) For purposes of this section

(1) The term "qualified candidate" means

(A) with respect to the Senate and the House of Representatives of the United States, an individual who has met all requirements established by the laws of the State from which he seeks selection to qualify as a candidate for election to the Senate or the House of Representatives of the United States, respectively, and

(B) with respect to the offices of President and Vice President of the United States, an individual who has met all the requirements established by the laws of any State to qualify as a candidate in such State for election to the office of President or Vice President of the United States, respectively.

(2) The term "qualified committee" means a committee or other organization (including National, State, and local committees of a political party) which has been designated in writing to the Secretary of the Treasury by a qualified candidate, or by two or more qualified candidates, as a committee which such candidate or candidates have authorized to make expenditures on behalf of his or their candidacy and to redeem vouchers under subsection (c) of this section.

(f) The Secretary of the Treasury is authorized to prescribe such regulations as may be necessary to carry out his duties under this section.

USE OF FUNDS; REPAYMENT OF UNUSED FUNDS

SEC. 4. (a) The moneys received by a qualified candidate under section 3 may be used by him only to defray expenses incurred by him in carrying on his campaign for election to the office for which he is a candidate. The moneys received by a qualified committee under section 3 may be used by it only to defray expenses incurred by it in carrying on its campaign on behalf of the candidate or candidates who designated it as a qualified committee for purposes of section 3(e) (2).

(b) Each qualified candidate and each qualified committee which receives moneys under section 3 shall, to the extent such moneys are not used as prescribed in subsection (a), repay such moneys to the Secretary of the Treasury. Such repayment shall be made as soon as practicable and, in any event, not later than December 31 of the year in which such moneys are received.

REPORTS TO COMPTROLLER GENERAL; AUDITS; REPAYMENTS

SEC. 5. (a) Each qualified candidate and each qualified committee which redeems congressional election campaign vouchers or presidential election campaign vouchers under section 3 shall, on or before December 31 of the year of redemption, render a true and accurate report to the Comptroller General of the United States of the use of the moneys paid to them under such section and not repaid to the

Secretary of the Treasury under section 4(b). The report required under this subsection by a qualified committee shall be made by the treasurer of such committee.

(b) The Comptroller General may conduct such audits and examinations as he deems necessary with respect to the reports received by him under subsection (a). In conducting any such audit or examination of any such report the Comptroller General shall have the right to examine any pertinent books and records of the qualified candidate or qualified committee making such report. Each such candidate and each such committee shall furnish to the Comptroller General such books, records, and other information as he may request. If as a result of any such audit or examination, the Comptroller General determines that any amount of the moneys received by such qualified candidate or qualiñed committee under section 3 and not repaid under section 4(b) was not used for the purposes prescribed by section 4(a), he shall so notify such candidate or such committee and such candidate or such committee shall repay such amount to the Secretary of the Treasury.

(c) No report shall be required under subsection (a) by any qualified candidate or qualified committee which has repaid to the Secretary of the Treasury all of the moneys received by such candidate or such committee under section 3.

(d) The Comptroller General is authorized to prescribe such regulations as may be necessary to carry out his duties under this section.

COORDINATION WITH CORRUPT PRACTICES ACT

SEC. 6. (a) For purposes of applying the Federal Corrupt Practices Act, 1925 (2 U.S.C. 241-256), moneys received under section 3 of this Act shall not be considered to be contributions. For purposes of applying section 309 of such Act (2 U.S.C. 248), expenditures made by a candidate which are defrayed out of moneys received by him under section 3 of this Act shall not be taken into accouut. (b) For purposes of applying section 609 of title 18, United States Code, moneys received under section 3 of this Act by a qualified committee which is a political committee (as defined for purposes of such section 609) shall not be considered to be contributions, and expenditures made by any such committee which are defrayed out of moneys received by it under section 3 of this Act shall not be taken into account.

CRIMINAL PENALTIES

SEC. 7. (a) It shall be unlawful for any person

(1) to sell, or offer to sell, or to purchase, or to offer to purchase, any congressional election campaign voucher or any persidential election campaign voucher issued under section 6096 of the Internal Revenue Code of 1954; (2) to use any moneys paid by the Secretary of the Treasury under section 3 of this Act for any purpose other than the purposes prescribed by section 4(a) of this Act;

(3) to fail to make any report to the Comptroller General of the United States required by section 5(a) of this Act to be so made;

(4) to make a false, fictitious, or fraudulent report to the Comptroller General of the United States under section 5(a) of this Act, or to include in any such report any misrepresentation of a material fact;

(5) to fail to furnish to the Comptroller General of the United States any books, records, or information required by section 5(b) of this Act to be so furnished;

(6) to falsify any book, record, or other information furnished to the Comptroller General of the United States under section 5(b) of this Act; or (7) to fail to pay to the Secretary of the Treasury any amounts required to be paid by section 4(b) or under section 5(b) of this Act.

(b) Any person who knowingly and willfully violates any provision of subsection (a) shall be fined not more than $5,000, or imprisoned not more than 5 years, or both.

AUTHORIZATION OF APPROPRIATIONS

SEC. 8. There are authorized to be appropriated such sums as may be necessary to carry out the provisions of this Act.

REPEAL OF PRESIDENTIAL ELECTION CAMPAIGN FUND ACT OF 1966

SEC. 9. The Presidential Election Campaign Fund Act of 1966 (title III of the Act of November 13, 1966, Public Law 89-809) is repealed.

[S. 1407, 90th Cong., first sess.]

A BILL To amend the Presidential Election Campaign Fund Act of 1966 so as to provide safeguards for the proper use of moneys paid to political parties from the presidential election campaign fund, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act may be cited as the "Honest Election Act of 1967".

SEC. 2. (a) (1) Subchapter A of chapter 61 of the Internal Revenue Code of 1954 is amended

(A) by striking out part VIII (relating to designation of income tax payments to presidential election campaign fund); and

(B) by striking out the item relating to such part VIII in the table of parts of such subchapter.

(2) The amendments made by paragraph (1) shall apply with respect to income tax liability for taxable years beginning after December 31, 1966.

(b) (1) Section 303 of the Presidential Election Campaign Fund Act of 1966 is amended

(A) by striking out the second sentence of subsection (a) and inserting in lieu thereof "The fund shall consist of amounts appropriated to it by section 305 of this Act.";

(B) by striking out subsection (b) and inserting in lieu thereof the following: "(b) TRANSFERS TO THE FUND.-The Secretary of the Treasury shall, from time to time, transfer from the general fund of the Treasury to the presidential election campaign fund the sums appropriated by section 305. Such transfers may be made on the basis of estimates by the Secretary of payments to be made by him under subsection (c).";

(C) by striking out as authorized by appropriation Acts," in subsection (c) (1); and

(D) by striking out the second sentence of subsection (c) (2) (C).

(2). Section 305 of such Act is amended to read as follows:

"SEC. 305. APPROPRIATIONS.

"There is hereby appropriated to the presidential election campaign fund, out of any moneys in the Treasury not otherwise appropriated, such sums as may be necessary to enable the Secretary of the Treasury to make payments under section 303(c) of this Act with respect to presidential campaigns, beginning with the presidential campaign conducted in 1968, and subject to the provisions of section 303(d) of this Act, such sums shall remain available for such purpose until expended.' SEC. 3. (a) Section 303 (c) (3) of the Presidential Election Campaign Fund Act of 1966 is amended by striking out subparagraph (B) and inserting in lieu thereof the following new subparagraphs:

"(B) No payment determined under paragraph (2)(A) shall be made under paragraph (1) into the treasury of a political party with respect to any presidential campaign in an amount which, when added to previous payments made to such party, exceeds the amount spent or incurred by such party in carrying on such presidential campaign. No payment determined under paragraph (2)(A) shall be made under paragraph (1) into the treasury of any political party with respect to any presidential campaign unless the treasurer of such party has certified to the Comptroller General that no contributions, direct or indirect, to defray expenses incurred or to be incurred in carrying on such presidential campaign have been accepted or expended prior to the date of the certification by such party or the candidates of such party for the offices of President and Vice President, or by any organization controlled directly or indirectly by such party or either of such candidates, and that no such contributions will be accepted or expended on or after the date of the certification.

"(C) No payment determined under paragraph (2) (B) shall be made under paragraph (1) into the treasury of a political party with respect to any presidential campaign in an amount which, when added to previous payments made to such party and to

"(i) the amount of contributions, direct or indirect, to defray expenses incurred or to be incurred in carrying on such presidential campaign accepted by such party or the candidates of such party for the offices of President and Vice President, or by any organization controlled directly or indirectly by such party or by either of such candidates, reduced by

"(ii) the amount which the treasurer of such party has certified has been or will be returned to the donors of the contributions described in clause (i),

exceeds the amount spent or incurred by such party in carrying on such presidential campaign, or the amount determined under paragraph (2) (A) for a political party entitled to payments determined under such paragraph, whichever amount is lower. No payment determined under paragraph 2(B) shall be made under paragraph (1) into the treasury of a political party with respect to any presidential campaign unless the treasurer of such party has certified to the Comptroller General the total amount of the contributions described in clause (i) accepted prior to the date of the certification and the total amount which has been or will be returned to donors of such contributions."

(b) Section 303(c)(1) of such Act is amended by striking out “(subject to the limitation in paragraph (3) (B))" and inserting in lieu thereof "(subject to the limitations in paragraphs (3) (B) and (C))".

SEC. 4. Section 303 (c) of the Presidential Election Campaign Fund Act of 1966 is amended by renumbering paragraph (5) as (8), and by inserting after paragraph (4) the following new paragraphs:

"(5) RESTRICTIONS ON USE OF PAYMENTS.-Not less than 75 percent of the payments made under paragraph (1) into the treasury of a political party with respect to a presidential campaign shall be used only to defray the following expenses incurred in carrying on such campaign:

"(A) Traveling and related expenses of the presidential and vicepresidential candidates and their campaign personnel;

"(B) Radio and television production and time expenses;
"(C) Newspaper and periodical advertising expenses;

"(D) Expenses for the preparation, printing, and distribution of campaign literature, including posters and billboards;

"(E) Expenses for postage, telegraph, telephone, and expressage; "(F) Expenses for research and analysis, including contracts for polls, surveys, and data processing; and

"(G) Reasonable salaries for campaign personnel and reasonable overhead expenses for maintaining campaign headquarters, including headquarters in State and local areas.

No payment made under paragraph (1) into the treasury of a political party with respect to a presidential campaign may be used to defray any expense incurred for services or products on the day of the presidential election other than services or products falling within one of the categories described in the preceding sentence.

"(6) AUDITS.—After each presidential campaign, the Comptroller General shall conduct a thorough examination and audit of the expenses incurred in carrying on such presidential campaign by each political party to which payments have been made under paragraph (1) or which is entitled to payments under such paragraph.

"(7) REPAYMENTS BY POLITICAL PARTIES.-If the Comptroller General determines that any amount of any payment made to a political party under paragraph (1) with respect to a presidential campaign was used by such party for any purpose other than

"(A) to defray expenses incurred in carrying on such presidential campaign and in conformity with paragraph (5),

to repay loans the proceeds of which were used to defray such expenses, or

"(C) to restore funds of such party which were used to defray such

expenses,

he shall notify such party. Such party shall pay to the fund an amount equal to the amount used for any purpose other than the purposes specified in subparagraphs (A), (B), and (C), and, unless it is shown that such use was due to reasonable cause and not to willful neglect, shall pay to the fund an additional amount equal to 25 percent of the amount so used. If such party is entitled to further payments under paragraph (1) with respect to such presidential campaign, or if such party will be entitled to payments under paragraph (1) with respect to the next presidential campaign, any payment from a political party required under this paragraph may, with the approval of the Comptroller General, be effected by reduction of such payments to such party."

SEC. 5. Section 303(c) (8) of the Presidential Election Campaign Fund Act of 1966 (as renumbered by section 4 of this Act) is amended to read as follows: "(8) DEFINITIONS.-For purposes of this title

"(A) The term 'political party' means any political party which presents candidates for election to the offices of President and Vice President of the United States.

"(B) The term 'presidential campaign' means the political campaign held every fourth year for the election of presidential and vice-presidential electors.

"(C) The term 'presidential election' means the election of presidential and vice-presidential electors.

"(D) The terms 'treasury of a political party' and 'treasurer of a political party' mean, with respect to any political party, the treasury and treasurer, respectively, of the national committee of such party, or, if such party does not have a national committee, the treasury and treasurer of the organization designated in writing to the Comptroller General by the candidates of such party for President and Vice President in the presidential campaign with respect to such party is entitled to payments under paragraph (1)."

SEC. 6. (a) The Presidential Election Campaign Fund Act of 1966 is amended by adding at the end thereof the following new section:

"SEC. 305. REPORTS TO CONGRESS; REGULATIONS.

"(a) The Comptroller General shall, as soon as practicable after each presidential campaign, submit a full report to the Senate and the House of Representatives setting forth

"(1) the amounts certified by him under section 303 (c) (4) for payments to each political party entitled to payments under section 303(c) with respect to such presidential campaign,

"(2) the expenses (shown by such categories, and in such detail, as the Comptroller General determines necessary) incurred by each political party to which payments were made under section 303 (c) in carrying on such presidential campaign, and

"(3) the amount of payments, if any, required from each such political party under section 303 (c) (7), and the reasons for each payment required. Each report submitted pursuant to this section shall be printed as a Senate document.

(b) The Comptroller General is authorized to prescribe such rules and regulations as he deems necessary to carry out the functions and duties imposed on him by this title.

"SEC. 307. MISUSE OF FUNDS EXPENDITURES BY POLITICAL PARTIES. "(a) (1) It shall be unlawful for any person who has custody, or control of the use, of any funds paid into the Treasury of a political party under section 303(c) of this Act knowingly and willfully to use, or authorize the use of, such funds for any personal purpose or for any purpose other than to defray expenses incurred in carrying on the presidential campaign with respect to which such funds are paid and in conformity with paragraph (5) of such section, to repay loans the proceeds of which were used to defray such expenses, or to restore its funds used to defray such expenses.

"(2) Any person who violates paragraph (1) shall be fined not more than $10,000 or imprisoned not more than five years, or both. No person shall be subject to any penalty under paragraph (1) for the commission of any act prohibited thereby if such person, for the commission of that act, has been convicted under section 1001 of title 18 of the United States Code, or any other provision of such title.

"(b) For purposes of applying section 609 of title 18 of the United States Code, payments received by a political party under section 303 (c) of this Act shall not be considered to be contributions, and expenditures made by a political party with respect to which a payment is received under such section shall not be taken

into account."

(b) Section 303(c) (4) of such Act is amended by striking out the last sentence thereof.