Cafferty talks up CREW's report, Family Affair:

Over the weekend, the Washington correspondent for the Dallas Morning News, Todd Gillman, wrote a coiumn about all the members of the Texas congressional delegation featured in CREW's report, Family Affair.  According to Gillman, the members in question defended the practice of paying family members with campaign funds.

The editorial writers at the Dallas Morning News don't share that view.  They think the whole thing stinks:

A sleight-of-hand loophole that allows Washington lawmakers to keep relatives on their campaign payrolls may be legal, but it sure has a stench to it.

Citizens for Responsibility and Ethics in Washington, a liberal-leaning watchdog group that recently tracked this trend, figures that more than $5.1 million in campaign funds for House members went to relatives, relatives' companies or relatives' employers during the past six years. The group's conclusions are based on an analysis of campaign finance reports from 337 House members.

The report couldn't conclude whether those relatives earned their pay, but it did note how popular the loophole is in D.C. For instance, one Utah congressman turned his campaign coffers into paychecks for six of his eight children; at least 64 House lawmakers paid relatives to work in campaign committees or political action committees in the past six years.

The nepotism was bipartisan: 26 Democrats and 38 Republicans landed jobs for relatives on campaign staffs.

 

The practice of paying family members, particularly spouses, has the potential to raise many conflicts of interests, given that the candidate stands to potentially benefit financially from any salary paid to a spouse.  This bill halts that practice, and it further ensures that the public is informed of any payment made to an immediate family member from the campaign. 

A particularly egregious practice involves the spouse of an elected official earning commissions for fundraising activity.  In those situations, the candidate or elected official personally pockets a percentage of all campaign funds raised by their spouse. 

A BILL

To amend the Federal Election Campaign Act of 1971 to prohibit authorized committees and leadership PACs of a candidate or an individual holding Federal office from making payments to the candidate's or individual's spouse, to require such committees and PACs to report on disbursements made to the immediate family members of the candidate or individual, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Campaign Expenditure Transparency Act'.

SEC. 2. PROHIBITING PAYMENT OF CAMPAIGN FUNDS TO SPOUSES OF CANDIDATES; DISCLOSURE OF PAYMENTS TO FAMILY MEMBERS.

(a) Prohibition- Section 313 of the Federal Election Campaign Act of 1971 (2 U.S.C. 439a) is amended by adding at the end the following new subsection:

`(c) Restrictions on Payments to Spouses; Disclosure of Payments to Family Members-

`(1) PROHIBITION-

`(A) IN GENERAL- Notwithstanding any other provision of this Act, an authorized committee of a candidate and a leadership PAC of a candidate or individual holding Federal office may not make any payment to the spouse of the candidate or individual (as the case may be) for services provided to the committee or leadership PAC.

`(B) EXCEPTION FOR REIMBURSEMENTS FOR TRAVEL- Subparagraph (A) does not apply to amounts paid to reimburse a spouse for any travel expenses which the committee or leadership PAC involved is permitted to reimburse under this Act.

`(2) DISCLOSURE OF PAYMENTS TO IMMEDIATE FAMILY MEMBERS- In addition to any other information included in a report submitted by an authorized committee or a leadership PAC of a candidate or individual holding Federal office under section 304, the committee or PAC shall include in the report a separate statement of any disbursements made to any immediate family member of the candidate or individual (as the case may be) during the period covered by the report, as well as any disbursements made to the spouse of the candidate or individual which the committee or leadership PAC is permitted to make under the exception described in paragraph (1)(B).

`(3) TREATMENT OF PAYMENTS TO CERTAIN ENTITIES- For purposes of paragraphs (1) and (2), a payment to an entity shall be considered to be a payment to the spouse or an immediate family member of the candidate or individual (as the case may be) if the spouse or immediate family member is an officer or director of the entity.

`(4) EXCEPTION FOR NOMINAL REIMBURSEMENTS- Paragraphs (1) and (2) do not apply to nominal amounts paid to reimburse a spouse or immediate family member for supplies and equipment used by the committee or leadership PAC involved, so long as the total amount paid by the committee or leadership PAC for all such reimbursements during a calendar year does not exceed $500.

`(5) DEFINITIONS- In this subsection--

`(A) the term `immediate family member' means the son, daughter, son-in-law, daughter-in-law, mother, father, brother, sister, brother-in-law, sister-in-law, or grandchild of the candidate or individual involved; and

`(B) the term `leadership PAC' means a political committee which is directly or indirectly established, maintained, or controlled by a candidate for election for Federal office or an individual holding Federal office but is not an authorized committee of the candidate or individual, except that such term does not include any political committee of a political party.'.

(b) Conforming Amendment- Section 313(a)(1) of such Act (2 U.S.C. 439a(a)(1)) is amended by striking `for otherwise' and inserting `subject to subsection (c), for otherwise'.

SEC. 3. IMPOSITION OF PENALTY AGAINST CANDIDATE OR OFFICEHOLDER.

Section 309 of the Federal Election Campaign Act of 1971 (2 U.S.C. 437g) is amended by adding at the end the following new subsection:

`(e) In the case of a violation of section 313(c) committed by an authorized committee or leadership PAC of a candidate or individual holding Federal office, if the candidate or individual knew of the violation, any penalty imposed under this section shall be imposed on the candidate or individual and not on the committee or leadership PAC.'.

SEC. 4. EFFECTIVE DATE.

The amendments made by this Act shall apply with respect to elections occurring after December 2007.