H.R. 9772, H.R. 9771, H.R. 9721, and H.R. 9722
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House Ways and Means U.S. House of Representatives
Follow its sittingsRichard Neal
You won't find one word about what the majority is doing to bring down these costs. What you will find is plenty of funding for Trump's war efforts, wild goose chases for solutions to problems that don't exist. And if they're serious about doing right by taxpayers, they should start by demanding answers about the senior Treasury officials who were forced out for refusing to go along with the politicization of tax audits. Or perhaps we'll get an answer to why the Trump's $400 million jet donated by a foreign government isn't even safe to fly. Maybe the majority can get us a few details about the $500 million contracts for the president's ballroom or many of the vanity projects around Washington.
We never seem with this majority to have time for that. The markup is also one that comes on the heels of the president imposing ever more price hikes on the American people. He cited wildfires as a reason for slapping one of our closest allies and trading partners with a 50% tariff. Think of it. 150 years of the best standing alliance perhaps on the earth, Canada.
We have now succeeded driving them away from the space where they died with American soldiers, where they saw us in a common border that stretches for thousands of miles to be an impeccable relationship, only to discover that that relationship is now severely damaged.
While there is a scrambling to justify his rationale, we know this: it's always about more tariffs at people we're mad at. That's the motive. We're once again paying the price for incoherent trade policies that are always driven by grievance and retaliation. The only reason that this continues is to get a free pass unilaterally to hike costs on the American people because our colleagues will not exercise their constitutional obligation to stand up for the institution of the House of Representatives. They pay no mind to their duty to stand against the President when they disagree, to rein in the chaotic trade policy, and to lower costs for our constituents.
We could mark up legislation right now to mark to come to a conclusion on the immunity agreement, which we're told has been dissolved, but we've yet to see evidence of it. The American people expect more than this, and while we're having another jam, another partisan budget, and more than $200 billion increase in spending without congressional review, families are watching gas prices now back above $4 a gallon. Our colleagues could even use these taxpayer dollars in their budget as they question again voter ID. That's not a budget. It's not what we were sent here to do, and the American people clearly see right through it.
I yield back my time, Chairman.
Jason Smith
Our first order of business is H.R. 9772, the Foreign Funding Transparency Act, introduced by Oversight Subcommittee Chairman Schweikert. Oversight Chairman Schweikert and I led an examination into foreign funding sources for tax-exempt organizations, which yielded some very interesting results. His willingness to hold these nonprofits accountable and engage in a nuanced legislative effort is ideal to lead this effort. While his bill collects aggregate data from the contributions of all foreign nationals, he specifically highlights the contributions of foreign nationals who are from China, Iran, North Korea, and Russia, those nations whose influence is particularly concerning in the tax-exempt sector. I urge my colleagues to support this bill, and I'm pleased to recognize the gentleman from Arizona, Mr. Schweikert, for an opening statement.
David Schweikert
Thank you, Mr. Chairman. And for everyone here, this is basically we've done this a couple times. This actual bill is a bit more restrained than some of the language we've offered in previous years. It is aggregate data where we get more granular data is if it's from a country of concern. And Mr. Chairman, my latest data says the nonprofit or tax-exempt sector is now almost 17% of the U.S. economy.
Where this came from from some of our previous investigations is we don't have enough visibility of foreign participation in tax-exempt organizations, how the money flows through, and how many of these organizations may also have the ability to move donations, some of these dollars into 501(c)(4)s or (c)(3)s, which eventually could also end up in U.S. politics. I would prefer to have gone much further and much more granularity in data, but for many of the conversations we had, this seemed to be a communal agreement on a starting point. So we're going to hopefully with this bill start to collect some baseline data on the scale of it and then be able to pull out if it's a country of concern. And with that, Mr. Chairman, I yield back.
Speaker 3
I now recognize the ranking member from Massachusetts, Mr. Neal, for his opening statement.
Judy Chu
Today, working-class families across America are wondering how they're going to pay rent at the end of the month, afford groceries, fill up their gas tank, or pay for the next doctor's appointment after being kicked off their health insurance. And what are Republicans on this committee doing to help those families? Absolutely nothing. Instead of lowering costs or helping working families, Republicans are once again wasting this committee's time on another partisan messaging bill that won't make a single family's life easier. Rather than strengthening charitable organizations, this bill piles on unnecessary bureaucratic items that will make it harder for nonprofits to serve their communities.
That's because charitable nonprofit organizations are already subject to long-standing transparency requirements. Under current law, they must confidently report the names and addresses of substantial donors to the IRS, and they are already prohibited from participating or intervening in political campaigns. These common-sense safeguards already protect taxpayers, preserve donor privacy, and help ensure the integrity of our charitable sector and our elections. But the Foreign Funding Transparency Act goes far beyond those existing requirements. It would require charitable organizations to publicly report the aggregate amount of contributions they receive from foreign nationals each year and would separately require them to report contributions from so-called foreign countries of concern.
And to comply with those requirements, organizations would effectively have to ask every single one of their donors for their nationality, even though that is not information charities currently collect. Think about what that means. Your local food bank, your neighborhood homeless shelter, a disaster relief organization helping families recover after wildfire, a charity collecting toys for children during the holidays. All of these organizations would have to begin asking every single donor about their nationality before accepting even a dollar's worth of contributions. Imagine wanting to donate twenty dollars to help wildfire survivors, support your local food bank, or give back during the holidays, only to be met with intrusive questions about your nationality before your donation can be accepted.
That doesn't increase transparency. It creates unnecessary barriers between charities and the people who simply want to help. And that's exactly why organizations that represent the nonprofit sector, including the National Council of Nonprofits, oppose this legislation. They understand what Republicans apparently do not. Every additional reporting requirement means more time spent on paperwork and less time spent serving communities.
And in fact, I submit for the record three letters from organizations opposing this requirement and this bill, and that is from the Council on Foundations, from the Independent Sector, and from the AFL-CIO.
Without objection.
Judy Chu
So once again, rather than addressing the challenges Americans actually face, Republicans are advancing legislation that will make it harder for charitable organizations to feed families, respond to disasters, support veterans, care for vulnerable communities, and provide critical services across this country. I urge my colleagues to vote no, and I yield back.
Jason Smith
The committee will now proceed to consideration of H.R. 9772, the Foreign Funding Transparency Act. Without objection, the measure will be considered as read and open for amendment at any point. At this time, I offer an amendment in the nature of a substitute, which was distributed in advance along with a green sheet explaining it. Without objection, the amendment in the nature of a substitute shall be considered as read, open for amendment at any point, and considered base text for purpose of amendment. I will now turn to Tom Barthold, Chief of Staff for the Joint Committee on Taxation, to provide a technical description of the amendment in the nature of a substitute with an emphasis on the changes made since introduction.
I ask that members hold their questions until after his presentation.
Tom Barthold
Mr. Chairman, the members of the committee have before them two Joint Committee documents, JCX-35-26 and JCX-39-26, which describe the underlying legislation and the Chairman's amendment in the nature of a substitute. By way of background and summary, tax-exempt organizations under present law are generally required to file information returns annually. This is usually the form 990. This legislation requires additional information from specified tax-exempt organizations. A specified tax-exempt organization under this legislation is defined as an organization whose gross receipts are greater than or equal to $200,000 per year or have assets as of the close of the prior taxable year greater than or equal to $1/2 million.
The aggregate contributions that these organizations receive from foreign nationals are to be part of detailed information required to be reported on the form 990, with more detailed breakdown with respect to foreign nationals from foreign countries of concern. This legislation and the Chairman's amendment in the nature of substitute makes clerical changes in identifying subsections rather than sections. The legislation itself would be effective for returns filed for taxable years beginning one year after the date of enactment, and the staff of the Joint Committee has estimated that this would have a negligible effect on federal receipts for the fiscal period of 2027 through 2036. That concludes my brief description. I'd be happy to answer questions that the members might have.
Jason Smith
Thank you. Are there any technical questions about the amendment in the nature of a substitute? Seeing none, we will move to strike the last word. Mr. Doggett is recognized to strike the last word.
Lloyd Doggett
Mr. Chairman, a day devoted in this committee to tax-exempt organizations instead of the concerns that most American families face, but surprisingly, a day devoted to tax-exempt organizations that totally omits the leading tax-exempt organization in the country. That's called the Trump Organization. Abusing public trust for private gain has become a way of life for the Trump family. They know that they can get away with anything they want because of the enablers they have here in this Congress. As for tax-exempt or non-government organizations that are the subject of the four bills before us today, authoritarians around the world deplore NGOs, non-government organizations, because by their very nature, they can't totally control and dominate them.
There's nothing in this first bill for the family that's staring a grocery bill that climbs higher every month, nothing for the young family that is priced out of having their first home, nothing for the worker who's wondering whether a decent retirement will ever be within reach, nothing for the millions of American families that Republicans forced out of affordable care and into Trump nothing care. This bill lowers not a single cost and lifts not a single wage.
What it does do is to take our tax code and weaponize it against charities, congregations, and unions that serve American families every day. Let's describe what is actually required. Every charity, every university, house of worship, community group in America files a form 990 which would now have to interrogate its donors about where they were from and hand a foreign donor ledger to the federal government. A donor's nationality is not information that charities normally collect, so a food bank in Austin, a scholarship fund, a children's hospital would each have to build a system to card their donors and sort them by country. And for what?
It stops no adversary of America. It doesn't protect our families. It's already illegal to route foreign money into elections. What it reaches is lawful and often admirable generosity: the international student who gives back to the university that educated her, the foreign foundation that's underwriting cancer research, the immigrant who tithes to her parish, the international union, excuse me, who receives dues from its Canadian members. All of these are legal transactions, and all of it under this bill is treated as suspect.
Now I'm the last person in this room to defend secrecy in politics. This committee knows that the corrosive flood of money of anonymous corporate and billionaire money that's coursing through the dark money 501(c)(4)s and into our elections. If the majority really wanted a genuine transparency bill, that money should also be its target. And of course it's not. Instead, this bill trains its fire on lawful giving from those who are not American while the anonymous domestic billionaire that actually distorts our democracy sails on totally untouched.
And we ought to be honest about what kind of law this is, because we've seen it before. Forcing non-government organizations to catalog their foreign funding is the opening move in the authoritarian's playbook. Russia wrote that playbook back in 2012, branding its nonprofits as "foreign agents" and has strangled them thereafter. This is the first step in the same direction. Today, the Republic of Georgia has a law, and I'm not inventing the name, Transparency of Foreign Influence Law, which forces any group that makes more than a fifth of its support from abroad to register as serving a foreign power.
It's driven thousands out onto the streets of Tbilisi and stalled the country's path into Europe. In India, a foreign funding disclosure regime has been used to cancel groups like Amnesty International, Greenpeace, and Oxfam. In Nicaragua, foreign agents law became the pretext to shut down thousands of charities and seize their assets, from cancer clinics to Save the Children. Every one of these regimes began with the same reassuring promise that it was only about transparency. I think there's a real danger from this bill and the other bills that are before us today.
It's critical that we provide reasonable protection for these organizations that provide such benefit for our country. Let's not politicize and weaponize them. Let them do their jobs. What will this bill do is just to chill lawful generous giving, bury our charities in paperwork, and hand the Treasury Department that has already openly declared war on civil society a fresh list of targets. I yield back.
Mr. Davis.
Danny Davis
Thank you, Mr. Chairman, and I move to strike the last word. Mr. Chairman, let me begin by expressing my strong opposition to the bill before us, H.R. 9772, the supposed Foreign Funding Transparency Act.
According to the bill's description, HR 9772 is intended to require disclosure by certain tax-exempt organizations of information relating to foreign contributions to such organizations. Yet a deeper dive reveals that the bill is drafted would essentially compel nonprofits to ask for and report on the nationality of donors, among other items of information as determined in the future by the Secretary of the Treasury, which is information currently not required or collected. The legislative changes mandated by this bill will do nothing more than increase the administrative and reporting burdens for valuable nonprofit organizations, many of which are already struggling to contain and sustain their programming during these tumultuous times. Since the onset of the Trump administration, we have seen US government funding and services slashed, delayed, paused, or restructured. And when this occurs, who do the American people turn to in order to fill the gap?
The answer is simple. They turn to the not-for-profit organizations. The very same entities that may be negatively impacted by this bill are the very same entities that have had to step in to deliver critical public services and assistance over the past year and a half to combat such issues as homelessness, behavioral health, workforce development, childcare, food insecurity, immigrant services, and the list goes on. So instead of collaborating on ways to better support the nonprofit sector or address affordability challenges facing American families and workers, my Republican colleagues are instead advancing harmful policies that target nonprofit charities and unions, policies that will potentially have a chilling effect on the abilities of these organizations to generate funding to carry out their important missions. The bill before us also fails to include any donor privacy exemption or guardrails as we've seen in past bipartisan approaches to this issue, which is partly why the National Council of Nonprofits, the AFL-CIO, and the Council of Foundations have all raised concerns about the committee's consideration of HR 9772 as currently drafted.
As Americans continue to struggle, as small businesses and nonprofits alike suffer, and as our economy weakens, I urge my colleagues to revisit this harmful partisan bill and instead focus on the more pressing matters confronting our fellow citizens: the cost of milk, eggs, bread, and gasoline. I thank you, Mr. Chairman, and yield back the balance of my time.
Gwen Moore
Thank you, Ms. Moore.
Thank you so much for yielding, Mr. Chairman. I actually wanted to engage in a colloquy with Mr. Doggett. He made some observations about the hamstringing of non-governmental organizations, and I was wondering if he saw a through line between that and what is happening in international organizations and what's happening here with this bill. What I'm thinking of, Mr. Doggett, is for the first time, member-directed spending, or so-called earmarks, we were not allowed to provide them to community-based organizations. And so many of our CBOs in this country do the work that government can't do on the local level.
And I was just wanting to yield to you to elaborate that, because I have been to countries where I've seen them attack the free press and NGOs, and we've actually met with NGOs almost in secret in some countries. And I wanted to yield to you to elaborate on that a little bit.
Lloyd Doggett
Well, the gentlewoman is certainly correct that this is a worldwide phenomenon. Wherever there's authoritarian government, wannabe tyrants and kings, they like to suppress non-governmental organizations. And you will certainly remember that the first foreign leader that President Trump met with before he was inaugurated was Viktor Orbán of Hungary. He made a crusade out of attacking George Soros and other forces in what was truly an anti-Semitic campaign to get universities and any kind of foreign organization out of Hungary. Now, fortunately, despite the campaign efforts of President Trump and Vice President Vance going to his last campaign rally, the people of Hungary, after 16 horrible years, were able to overthrow and vote out Orbán.
Hopefully, it's not going to take us that long here in the United States to reclaim our government. But the point you made, the point Mr. Davis made, is very significant, that community organizations are having to fill in the gaps at food banks, in education, in one area after another throughout our states for what the Trump administration, the Trump regime, is failing to provide, all the cuts they're doing in order to fund their foreign wars and their tax breaks for billionaires. And this is part of the same effort: deny the funding that we can no longer provide to a community organization that we might respect in our communities, so that they don't have the resources to do the job, and now impose additional paperwork on them, not because of their abuse, but because they are serving and they're serving in a way that is independent and not totally reliant on the Trump regime. So I think that's the focus, and as I mentioned in my opening remarks, it's not just Hungary. You can look at Nicaragua, you can look at Turkey, you can look at one country after another around the world where you have all power being concentrated in a single person, and they want to be rid of non-governmental organizations.
And then there is, of course, the total contradiction today that I know you're familiar with, that you talk about tax-exempt organizations, but you exempt from the discussion the number one tax-exempt organization, that being the Trump organization. They don't want to pay taxes. Trump doesn't want to pay taxes on billions of dollars that he earned last year, and this Republican committee and Republicans in general are determined that he doesn't ever face an audit about it. He can pay kind of what he wants to pay, and one year in the past he was generous enough on huge earnings to pay $750, which was more than most years when he didn't pay a dime.
Gwen Moore
Thank you so much, Mr. Doggett. I was curious, and I was reflecting on being in Hungary and being very anxious to get out of there. And so with that, I would yield back.
Mr. Beyer.
Donald Beyer
Thank you, Mr. Chairman. Mr. Chairman, I too am deeply concerned about the current state of foreign interference in US domestic policies. The Trumps have made it clear that his administration is pay-for-play. Every day is a new news article about Trump being bought by a foreign government, all so he can enrich himself and his buddies. Just look at UAE buying a stake in World Liberty Financial, a cryptocurrency company owned by the Trump family, and then being rewarded with importing Nvidia chips, or Qatar and Air Force One, since Trump proudly boasted about that the other day.
But instead of looking at the elephant in the room with repeated and well-documented evidence of grift, inappropriate foreign influence, and self-dealing, we are here today to attack our charitable sector. And instead of operating on evidence and working in a bipartisan manner to address undue influence, like how the ballroom or inaugural committee donations were handled, we're making sweeping proposals that infect the entire charitable sector. It's hard not to view this then as another part of the administration's strategy to silence actors it doesn't like, rather than a good-faith effort to address malign foreign influence. The practical effect of requiring nonprofits to ask for the nationality of all their donors is that it will create a chilling effect on their donations at a time when charitable donations are slowing. While limiting foreign interference in domestic matters is important, being thoughtful about how we craft legislation so that we are not creating laws that could be weaponized against Americans, silencing political dissidents, or for racial profiling, that should be paramount.
We've seen time and again how xenophobic sentiment has been weaponized inappropriately in Congress to attack and discriminate against Americans in the US. A nonprofit could set up a selective screening system where those with certain names are the ones who get their nationality questioned. Or you could see this affect diaspora communities. I represent a number of very important diaspora communities in Northern Virginia. Folks with legal status who donate to an international pro-democracy or foreign human rights organization, but they fear retribution from their home country, including to their relatives who still live back in that home country.
This bill could suppress diaspora giving for fear of government surveillance or political fallout at home. And in this administration, we've already seen how they like to create enemy lists. There are very real cases, including some of my constituents, that this administration has initially tried to harass, bringing them up on charges on false pretenses and more. It's not unrealistic to think someone on a green card who is here legally as a resident would refrain from donating to an organization for fear of being placed on Stephen Miller's enemies list. We've seen this from Stephen and Katie many times already.
And this negatively impacts unions who have members who are non-US citizens or LPRs and risk chilling fundraising for fear of generalizations about the national origin of a donation. And then there's the question of disaster relief. If someone from another country wants to donate to our many disasters, let them. Is that malign influence? I don't think so.
We need all the money we can get to support local communities after a disaster. And then let's talk about whether someone lies to these organizations about their nationality. There's so much sufficient legal ambiguity in this "should have known" standard that puts these organizations in a tricky position. And if they do everything correctly and report foreign donations regardless of what the percent is, said organization could be weaponized by opponents as being foreign-funded or un-American. I'm really concerned.
This is not a bill that helps prevent hostile foreign actors intent on illicitly influencing US policy.
Speaker 13
This goes too far to risk that safety net without meaningfully trying to fix the problem the sponsor is trying to fix. Mr. Chairman, I yield back.
Jason Smith
Thank you. Are there additional members that wish to strike the last word? Seen none, we will move to amendments. Are there any amendments in the nature of a substitute? Mr. Horsford.
Speaker 16
A point of order has been reserved. Would the gentleman suspend while the amendment is distributed? Gentleman proceed.
Steven Horsford
Thank you, Mr. Chairman. Before I begin, I request unanimous consent to enter into the record a letter from the AFL-CIO citing their concerns on this bill.
Without objection.
Steven Horsford
Thank you. This underlying bill makes it that every single donation to a nonprofit must be surveilled. The bill is as simple as that. The bill requires that nonprofits will track every contribution and be required to ask you what nationality you are. What I don't understand is how my colleagues are afraid to fund the IRS, but now you want the IRS to identify and track the nationality of every person to ever donate to a charity.
Let's put that into perspective with unions. The bill is so broad that even union dues would count under this bill. So a union is now going to be required to track every single member and group every member by nationality under your bill. A union's job is to advocate for all of its workers, not surveil them. Yet this bill would require every union, every food pantry, to create hidden list of nationalities for the government to have on them.
I dare you to come to Nevada and to tell union workers that I represent that the government is now requiring a list to track you. And what's so ironic is that in all of these bills, not once are we dealing with billion-dollar multinational corporations that can donate through US subsidies. So why are we requiring food pantries and unions to be the targets? Make it make sense. So my amendment is simple.
I would like to exclude labor organizations from this bill. A labor union is meant to represent all workers in the workforce, US citizens and legal foreign nationals. If you stand with workers, if you stand with their right to organize, then you will support my amendment. Otherwise, you are supporting a surveillance state government over these transactions and the collection of their information, including their nationality. With that, I yield back.
Jason Smith
Thank you. Are there additional members that wish to strike the last word? Seen none, the question is on agreeing to the amendment offered by Mr. Horsford.
The clerk will call the roll.
Speaker 11
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Kelly. Mr. Kelly, no. Mr. Schweikert.
Mr. Schweikert, no. Mr. LaHood. Mr. LaHood. Mr. LaHood, yes. Mr. LaHood, no.
Mr. Arrington. Mr. Estes. Mr. Estes, no. Mr. Smucker. Mr. Hern.
Mr. Hern, no. Mrs. Miller. Mrs. Miller, no. Dr. Murphy. Mr. Kustoff.
Mr. Fitzpatrick. Mr. Steube. Ms. Tenney. Ms. Tenney, no. Mrs. Fischbach.
Mrs. Fischbach, no. Mr. Moore. Mr. Moore, no. Ms. Van Duyne. Ms. Van Duyne, no.
Mr. Feenstra. Mr. Feenstra, no. Ms. Malliotakis. Ms. Malliotakis, no. Mr. Carey.
Mr. Miller, no. Mr. Carey, no. Mr. Yakym. Mr. Yakym, no. Mr. Miller.
Mr. Bean. Mr. Bean, no. Mr. Moran. Mr. Moran, no. Mr. Neal.
Mr. Neal, yes. Mr. Doggett. Mr. Doggett, yes. Mr. Thompson. Mr. Thompson, yes.
Mr. Larson. Mr. Larson, yes. Mr. Davis. Mr. Davis, yes. Ms. Sanchez.
Ms. Sanchez, yes. Ms. Sewell. Ms. DelBene. Ms. DelBene, yes. Ms. Chu.
Ms. Chu, yes. Ms. Moore. Ms. Moore, yes. Mr. Boyle. Mr. Boyle, yes.
Mr. Beyer. Mr. Beyer, yes. Mr. Evans. Mr. Evans, yes. Mr. Schneider.
Mr. Schneider, yes. Mr. Panetta. Mr. Panetta, yes. Mr. Gomez. Mr. Horsford.
Mr. Horsford, yes. Ms. Plaskett. Mr. Suozzi. Mr. Suozzi, yes. Mr. Smith of Nebraska.
Mr. Smith of Nebraska, no. Mr. Arrington. Mr. Arrington, no. Mr. Smucker. Dr. Murphy.
Chairman Smith, no.
How is Mr. Kustoff recorded?
Mr. Gomez is not recorded.
Mr. Gomez, yes.
Clerk will call the roll.
Repeat the number.
The yeses are 17 and the nos are 22.
Speaker 27
There being 17 yeses and 22 nos, the amendment is not agreed to. Are there additional amendments?
Mr. Chair, I wish to offer an amendment.
Ms. Chu.
Speaker 16
A point of order has been reserved. Will the gentlelady suspend while the amendment is distributed? You can proceed.
Judy Chu
Over the past 18 months, Americans have grown exhausted by Donald Trump's blatantly corrupt pay-to-play scheme. Time and time again, Trump has shown exactly who he works for: himself. The day before Trump's inauguration, billionaire Justin Sun announced he would be purchasing $45 million in crypto tokens from the World Liberty Financial, the family's crypto business of Trump. A month later, Trump's SEC announced they'd be pausing an investigation started by the Biden administration into Sun's alleged crypto crimes. Last year, the Qatari royal family donated a Boeing airplane to President Trump to be used as his Air Force One jet.
A jet I must note was recently grounded because it was discovered it lacked the required defensive capabilities only after the president had flown on it for official business. But even after upgrades, the jet won't be used for official business, instead it will be donated to Trump's future presidential library. And speaking of that presidential library, in May it was announced that the Japanese conglomerate SoftBank Group donated 50 million dollars to Trump's Presidential Library Foundation, a 501(c)(3) organization. This is exactly the type of nonprofit that Republicans are demanding provide more transparency and information regarding contributions or donations from foreign nationals. So my amendment is simple.
If Republicans are truly serious about ensuring certain tax-exempt organizations report how many contributions they receive from foreign nationals and from where, then they should have no problem at all with ensuring President Trump's tax-exempt organizations are beholden to the same requirements. My amendment would ensure that presidential libraries and the tax-exempt organizations that operate them, like Trump's Presidential Library Foundation, are subject to the requirements of this bill and therefore would be mandated by the same public reporting requirements as Republicans are demanding of other similarly structured tax-exempt organizations. I urge support for my amendment and I yield back.
Jason Smith
Is there additional members that wish to strike the last word? Mr. Doggett.
Lloyd Doggett
Sponsors of this bill are telling us that they're so deeply troubled by foreign money going into nonprofit organizations, but they ignore the leading tax-exempt organization in this country, the Trump organization and its various entities that are out there like the Library Foundation. They ignore the fact that the Trump organization, the Trump regime, is out turning on the money spigot in one country after the world around the world, one country after another. This amendment, a very solid amendment, simply includes the president's own Presidential Library Foundation among those who must disclose. And that's appropriate since it's a 501(c)(3) organization, it files the very same form 990 that this bill amends, it's a specified tax-exempt organization under the text of their proposal. It just assures that the president on this foundation cannot wiggle out as he has wiggled out from most everything else, but he ought to at least apply that we ought to at least apply the same rule to him that we would to a food pantry or a church under this bill.
And consider why this matters. Under this bill as written, a food bank in Austin must interrogate its donors and report every dollar that comes from abroad. But the president of the United States could accept a 400 million dollar luxury jet from Qatar, fly it as Air Force One, at least fly it one way, he didn't have it up to date enough to even after spending hundreds of millions of dollars of taxpayer money to come back from Turkey, but fly it under this expense and then hand it over in a matter of just a few months to his tax-exempt Library Foundation and potentially disclose nothing about it. If this committee is truly worried about foreign influence through tax-exempt organizations, there's not a clearer case than Trump's jet. A gift of that size from a foreign government to the president's own nonprofit, a government that depends on him to protect our military on their soil and ours.
The Chu amendment makes sure that there is disclosure, and it's not only the jet. Corporations with billions of dollars riding on the administration's decisions have pledged at least 63 million dollars to Trump's library, with the total value of gifts pouring in approaching half a billion dollars. Paramount, for example, routed 16 million dollars into that library after a phony Trump lawsuit. This is the very same company that Trump is relying upon to muzzle CNN just as it muzzled CBS. A deal that would hand also at the same time Gulf sovereign wealth funds like Qatar's major ownership interest over one of America's largest news companies.
Meta paid 22 million, ABC 15 million, Elon Musk 10 million. These weren't gifts to history, they were payments from parties with business before the government routed into a fund controlled by the very man who would decide their fate. It wasn't a taxpayer-free operation, it was businesses knowing that this was just a normal course of business to pay in to Trump. And there's another significant reason here that we need the disclosure that Congresswoman Chu is proposing. The original fund that was set up to fund the presidential library, the Donald J. Trump Presidential Library Fund, was quietly dissolved down in Florida.
Tens of millions of dollars that companies swear they paid cannot be accounted for by those who have inquired from the Senate. They had to write requesting that information, and it's unclear how much of that money may have found its way directly into Trump's pocket or that of his family. In the dark, Mr. Chairman, you cannot tell a library fund from a slush fund, and that's what this amendment is focused on. Disclosure is how you tell them apart. We spent all morning demanding that charities and universities and congregations bare their books on foreign money and then vote to keep the blinds drawn on the one tax-exempt organization being used as a foreign government piggy bank by the president himself.
A vote against this amendment says plainly that transparency is for the food bank but not for the powerful, not for those who are enriching themselves. Really the same kind of problems that we've seen with his destruction of the East Wing of the White House where again donors who had business before the government decided to pay him rather than compete in a fair way. So I urge the adoption of the amendment as a way of assuring some equity here and applying uniformly this new provision to Trump himself. I yield back.
Jason Smith
Additional members wish to strike the last word? Seen none, the question is on agreement to the amendment offered by Ms. Chu. The clerk will call the roll.
Speaker 17
Miss Van Duyne. Ms. Sewell. Ms. Plaskett. Chairman Smith. Chairman Smith, no.
Mr. Chairman, the yeses are 17 and the nos are 23.
Are there additional amendments? There being 17 nos and 17 yeses and 23 nos, the amendment is not agreed to.
Jason Smith
Mr. Chairman, I have an amendment at the desk.
Ms. DelBene, would you, would you suspend while the amendment is distributed? A point of order has been reserved. You can proceed.
Suzan DelBene
Thank you, Mr. Chairman. My amendment is based on a simple principle: all Americans should pay their fair share.
But that won't happen if the IRS lacks the resources needed to effectively enforce our tax laws. For years, Republicans have repeatedly cut IRS's enforcement funding and diminished the agency's workforce. And during the most recent tax filing season, the IRS was forced to reassign many of its remaining employees to responsibilities outside of their areas of expertise, following the administration's indiscriminate mass terminations. The wealthy and well-connected know this and are actively exploiting a weakened IRS to avoid scrutiny while ordinary taxpayers bear the consequences. My colleagues across the aisle talk about how they want to root out waste, fraud, and abuse in programs that working families rely on.
Jason Smith
Will the gentlewoman suspend? Mr. Chairman, the committee room is not in order.
Suzan DelBene
It has been a little obnoxious today with the people in this crowd, so let's keep it quiet.
Thank you. My colleagues across the aisle talk about how they want to root out waste, fraud, and abuse in programs that working families rely on, yet the current $700 billion tax gap between what taxes are owed to the government and what it collects, predominantly a result of wealthy people and corporations not paying their fair share. It's not from working families. And before you argue that this amendment is not related to the underlying bill, I would argue that it is necessary if you actually want to achieve the goals in the bill. For example, let's talk about your own bill's disclosure requirements.
Those will only be effective when the agency responsible for enforcement has the personnel, the technology, and the expertise necessary to review those disclosures, identify inconsistencies, and enforce the law. You cannot demand greater transparency while simultaneously stripping the IRS of the resources needed to determine whether organizations are reporting foreign funding fully and accurately. My amendment restores the resources that my Republican colleagues have chipped away at to provide better taxpayer service, protect the integrity of our tax system, reduce the deficit, and ensure that everyone, no matter how wealthy or powerful they are, follow the same rules. I urge adoption of my amendment and I yield back.
Does the gentleman insist on his point of order?
Adrian Smith
Mr. Chairman, I make a point of order against the amendment under clause 7 of House Rule 16, amendments that expand the scope of the underlying measure are not germane. This amendment expands the scope of the underlying measure beyond matters related to funding of the IRS, which are outside the scope of the underlying measure and therefore the amendment is not germane. I urge the chair to sustain the point of order.
Suzan DelBene
Does the sponsor of the amendment wish to be heard on the point of order?
I do, Mr. Chairman. All of today's bills impose additional regulatory and oversight responsibilities on the IRS at a time when the agency is understaffed. My amendment would attempt to bridge the gap between what you are asking the IRS to accomplish and what the IRS actually has the resources to do. My amendment does not add anything outside the scope of the IRS, it simply restores funding that would support the agency in carrying out functions including those in this bill. The underlying bill expands compliance obligations on nonprofits.
Adequate IRS resources are needed for implementing those obligations and this amendment addresses that.
Jason Smith
I'm prepared to rule, the amendment is not germane and the point of order is sustained, the amendment is not in order.
I'd like to appeal the ruling of the chair.
Speaker 24
The question is on tabling the appeal of the ruling of the chair, the clerk will call the roll.
Clerk will report the vote.
Jason Smith
There being 21 ayes and 18 noes, the appeal is tabled. Are there additional amendments? Seen none, the question is on the adoption of the amendment in the nature of a substitute. All those in favor signify by saying aye. Aye.
Those opposed say no.
In the opinion of the chair, the ayes have it, and the amendment in the nature of a substitute is agreed to. I will now recognize Mr. Smith for purpose of offering a motion.
Mr. Chairman, I move that the committee favorably report H.R. 9772 as amended to the House of Representatives.
Jason Smith
The question is on the motion to favorably report H.R. 9772 as amended to the House of Representatives. The clerk will call the roll.
Speaker 11
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Smith of Nebraska, yes. Mr. Kelly. Mr. Kelly, yes.
Mr. Schweikert. Mr. LaHood. Mr. Arrington. Mr. Gomez, no. Mr. Horsford.
Mr. Horsford, no. Ms. Plaskett. Mr. Suozzi. Mr. Suozzi, no. Mr. Buchanan.
Mr. LaHood, yes. Mr. Arrington. Mr. Arrington, yes. Mr. LaHood. Mr. Schweikert.
Mr. Smucker. Mr. Smucker, yes. Dr. Murphy. Ms. Van Duyne. Mr. Feenstra.
Mr. Feenstra, yes. Ms. Plaskett.
How is Mr. Schweikert recorded?
Mr. Schweikert is not recorded.
Mr. Schweikert, yes.
Chairman Smith?
Chairman Smith, yes.
Jason Smith
There being 23 ayes and 18 nays, the motion is agreed to and H.R. 9772 as amended is ordered favorably reported to the House. Without objection, I ask that staff be authorized to make technical and conforming changes to H.R. 9772 and that members have two additional days to file with the committee clerk supplemental, additional, dissenting, or minority views. Our next order of business is H.R. 9771, the Stopping Foreign Influence in Elections Act of 2026, introduced by Representative Malliotakis. As a member of both our tax and oversight subcommittees, as well as someone who has seen the effect that dark money has had on our elections, Representative Malliotakis appreciates the need to close this loophole and keep wealthy foreign donors out of our politics. I urge my colleagues to support this legislation and I'm pleased to recognize the gentlelady from New York, Ms. Malliotakis, for an opening statement.
Nicole Malliotakis
Well, thank you, Mr. Chairman. I appreciate this bill, my Stopping Foreign Influence in Elections Act of 2026, being included in today's markup. Foreign nationals should not be able to use tax-exempt organizations as a vehicle to influence American elections. Our elections should be decided by American voters, not by foreign billionaires who can move money through a network of nonprofit organizations and political groups to influence our democratic process. Under current law, foreign nationals are prohibited from donating directly to political committees, but there are no restrictions preventing those same foreign nationals, including those from adversarial nations such as China, Cuba, Russia, and Iran, from funneling money through tax-exempt organizations that then transfer funds to political committees, including super PACs, that are involved in our elections.
This is a significant loophole and my legislation, H.R. 9771, closes it in a straightforward and targeted way. Reporting suggests that foreign nationals have taken advantage of this loophole in the tax code, which allows tax-exempt organizations that receive contributions from foreign nationals to then turn around and donate large sums to political committees. For example, Swiss billionaire Hansjörg Wyss has reportedly used his U.S.-based tax-exempt organizations to contribute to other organizations that then directed significant sums into the political process. Mr. Wyss operated both a 501(c)(3) organization, the Wyss Foundation, and a 501(c)(4) organization, the Berger Action Fund. According to reporting by the New York Times cited in the House Ways and Means Committee report, the Berger Action Fund contributed more than $135 million to the Sixteen Thirty Fund over a four-year period, and in 2020 alone, that Sixteen Thirty Fund contributed $63 million to super PACs supporting President Biden and the Democrats.
The bill prohibits larger tax-exempt organizations from making contributions to political committees for two years after receiving a gift or contribution from a foreign national. The restriction applies to organizations with at least $200,000 in annual gross receipts or $500,000 in assets. The bill also establishes escalating penalties for tax-exempt organizations that violate this prohibition by accepting contributions from foreign nationals and then donating to political committees. After a third violation, the organization's tax-exempt status is suspended for a two-year period beginning on the date the prohibited contribution is made. The legislation is similar to H.R. 8314, the No Foreign Elections Interference Act, which this committee passed on a bipartisan basis last Congress.
The bill before us builds on that effort by incorporating important improvements that make the legislation more practical, proportional, administratively feasible to enforce. This legislation also ensures that organizations cannot simply route money through a 501(c)(4) organization to evade these restrictions. Because certain 501(c)(4) organizations may make unlimited contributions to political committees, including super PACs, closing the potential workaround is an important part of this bill. I would also like to clarify a common misconception about this legislation. This bill does not prohibit or interfere with unions or trade associations that receive membership dues from foreign individuals.
Those payments are considered business expenses rather than gifts or contributions and are therefore outside the scope of this legislation. This bill is not aimed at program service revenue or membership dues. It is narrowly focused on gifts and contributions made to tax-exempt organizations that subsequently make contributions to political committees, including super PACs. Look, the purpose of this legislation is simple. Foreign nationals should not be able to contribute to tax-exempt organizations and then have those funds ultimately used to influence American elections.
Mr. Schweikert's bill requires the transparency to know who's doing it, and our bill penalizes it. Our elections belong to the American people. H.R. 9771, the Stopping Foreign Influence in Elections Act of 2026, is an important step toward ensuring that foreign money does not find its way into our political process through nonprofit organizations, and I urge my colleagues to support the bill. And I yield back. Thank you.
I now recognize the ranking member.
Richard Neal
Thank you, Mr. Chairman. I want to yield my time to the gentleman from Nevada, Mr. Horsford.
Steven Horsford
I thank the ranking member for yielding time and to the chairman. Look, first I want to request unanimous consent to enter into the record the FEC website that specifically states that foreign nationals cannot directly or indirectly contribute to campaigns.
Without objection.
Steven Horsford
Thank you. I also want to thank my colleagues for finally showing us what this committee's priorities are, because it sure isn't the affordability crisis. Families in my district from North Las Vegas to Beatty are being squeezed every month by the cost of groceries, rent, childcare, gas prices, and insurance every single month. And what has this committee done about it? Absolutely nothing.
A tax refund from four months ago is not paying for next month's rent. It does not pay August's grocery bill or September's childcare payment.
You cannot solve a monthly crisis with a one-time payment and everybody in this committee knows it. So what are we doing today with this committee's limited time while families ration insulin and skip meals? We are debating the tax-exempt status of nonprofit organizations. We are adding punitive steps to target unions and food banks. My question is why.
Federal law already prohibits foreign nationals from making contributions, donations, or expenditures in connections with federal, state, and local elections. And if the thought process is that a 501(c) can be a pass-through here, then write a clearer bill that does that. Instead, we're here to debate a bill that the majority knows will weaponize the tax code against organizations they don't like. Let's name the organizations being targeted. Food banks, community health centers, civil rights organizations.
That's how broadly this bill is written. So instead of lowering the damn rent or making sure insurance premiums don't feel like you're getting mugged, this committee is focused on punishing political enemies through the IRS. But let's talk about what this bill is, if it what it does. If an organization, any 501(c), received any donation from any foreign national in the past two years, every political contribution becomes radioactive. I want to put that in perspective for my colleagues who claim to be pro-union, because labor unions are 501(c) organizations.
That means if a single union local has a single dues-paying member who isn't a US national, under this bill, the union's voice in our democracy gets taxed into silence. To my colleagues on the other side who have spent the last few years telling us how pro-worker they've become, the unions have looked at this bill and they don't like it. The unions are telling you it hits them. The people that you claim to fight for are telling you in plain English that this bill silences them. So where is your voice?
Where is your anger on behalf of your constituents? When a bill drafted to muzzle working men and women comes to this committee, my colleagues are suddenly silent. In fact, some of them aren't even here. Families can't afford this economy and this committee can't be bothered to care. It is already illegal for foreign nationals to directly or indirectly inject money into our elections.
The American people are telling us they can't afford basic living standards. That is what the serious issue is that we should be addressing. And before we leave for some August district work period, that's what this committee should be taking up, not attacks on nonprofit organizations that provide services to our constituents. I yield back.
Jason Smith
The committee will now proceed to consideration of H.R. 9771, the Stopping Foreign Influence in Elections Act of 2026. Without objection, the measure will be considered as read and open for amendment at any point. At this time, I offer an amendment in the nature of a substitute, which was distributed in advance along with a green sheet explaining it. Without objection, the amendment in the nature of a substitute shall be considered as read, open for amendment at any point, and considered base text for purpose of amendment. I will now turn to Tom Barthold, Chief of Staff of the Joint Committee on Taxation, to provide a technical description of the amendment in the nature of a substitute, with an emphasis on the changes made since introduction.
Tom Barthold
Thank you, Mr. Chairman. The committee members have before them two Joint Committee documents, JCX-36-26 and JCX-40-26, which describe the underlying legislation and the Chairman's amendment in the nature of a substitute. The Chairman's amendment in the nature of a substitute corrects some singular nouns to plural nouns. To basically review what the legislation does, it provides that if any organization exempt under section 501(c) makes a contribution to a political entity and if in the two-year period prior to that contribution the organization has received a contribution or gift from a foreign national, then the organization has made what the legislation defines as a disqualified political committee contribution. There is then imposed a tax of 100% of the value of a disqualified political committee contribution on the first such instance of such contribution.
Second instance of such a contribution, a 200% tax is imposed. And in a third instance, a 200% tax is imposed plus there's a two-year period loss of exemption for the organization. An additional penalty is provided under this legislation equal to 200% of the value of the contribution by specified tax-exempt organizations, and these are certain larger tax-exempt organizations. This legislation would be effective for contributions made after the date which is one year after the date of enactment. And the staff of the Joint Committee on Taxation has estimated that this would increase federal receipts by less than $500,000 over the budget period of fiscal years 2027 through 2036.
That concludes my brief description. I'd be happy to answer questions that the members might have.
Speaker 33
Thank you. Are there any technical questions about the amendment in the nature of a substitute, Ms. Chu?
Judy Chu
Mr. Chair and Mr. Barthold, under this bill, a tax-exempt organization that receives even a single contribution from a foreign national during the previous two years would be penalized for making contributions to a political entity, including a section 501(c)(4) organization. If they do so, the organizations could even lose its tax-exempt status for the next two years. Before I begin, I want to clear be clear about one point. Under current law, foreign nationals are already prohibited from contributing to candidates, political committees, and other political organizations. No one on this committee is proposing to weaken those protections.
My concern is that this legislation reaches far beyond federal election spending and instead penalizes charities and nonprofits for accepting lawful foreign donations that have nothing to do with politics. So Mr. Barthold, I'd like to understand how broadly this proposal would apply. There is no minimum dollar amount of foreign contributions that would trigger these restrictions. It could be as little as a dollar or even 50 cents. Is that correct?
That is correct, Ms. Chu.
Judy Chu
There is no specific prohibition on union dues being considered contributions. Therefore, unions could be affected. So let's say the IRS interprets this bill's incredibly broad definitions to mean that union dues do count as contributions. And so let's say a non-citizen joins a union as they are explicitly allowed to do and they begin paying their dues. Under this bill, would that union then be penalized for donating to a PAC or 501(c)(4) social welfare organization?
Tom Barthold
Ms. Chu, under present Treasury regulations, there's a distinction between contributions and union dues. But if you stipulate as you just did that the Treasury were to treat dues as contributions, then yes, the union organization could be subject to these penalties.
Judy Chu
Okay. Let's say that a US-based tax-exempt charity accepts donations from a Canadian grocery store chain that solicits donations through a customer round-up program. I mean, it might be seven cents. But if the charity receives the donation in such a manner, would they be prohibited from making contributions to a 501(c)(4) social welfare organization?
Tom Barthold
The legislation does not provide a prohibition, but it would potentially subject the charitable organization to the penalty excise tax.
Judy Chu
So the answer is yes. Let's say a US-based tax-exempt disaster relief organization responds to a catastrophic wildfire like the Eaton Fire that devastated my district, and a donor living in Mexico contributes online to support recovery efforts. Under this proposal, would that organization be therefore prohibited from making contributions to a section 501(c)(4) social welfare organization?
Tom Barthold
Well, again, just to be precise, not a prohibition, but the organization could be subject to the penalty excise tax.
Judy Chu
Well, then the answer is yes. Suppose a US-based tax-exempt humanitarian organization provides medical care overseas and receives a small recurring donation from an Australian supporter of ten dollars a month to help fund that charitable work. Under this proposal, would this organization be penalized if it makes contributions to political entities, including 501(c)(4) social welfare organizations?
Tom Barthold
I should probably clarify a little bit further. The legislation provides that the charitable organization can make reasonable representation of whether a person is a donor is foreign or not. I think in the case that you've just described, if it's a regular foreign donor, it would be reasonable to assume that the organization knew that it was foreign and so would be subject to the excise tax.
Judy Chu
Well, this, yeah, so the answer is yes. Finally, none of these examples involve foreign nationals contributing to political organizations or election campaigns. Instead, they involve lawful charitable donations that are entirely unrelated to political activity. Is that correct? Yet under this bill, each organization could still face these penalties.
Judy Chu
Thank you, Mr. Barthold. These answers confirm my serious concerns that this legislation will do nothing to prevent foreign influence in our elections and will instead hugely penalize nonprofits and even unions from being able to accept any funding from foreign nationals and entities. This is not a serious proposal. I yield back.
Jason Smith
Thank you. I have a couple technical questions, Mr. Barthold. As the gentleman from Las Vegas referred to earlier, putting into the record saying that it is illegal for members of Congress to receive foreign donations in the FEC, all of that. I have a question about foreign dollars into these nonprofits, which this bill is about. Any nonprofit that receives foreign dollars, is there anything that excludes them to give to a political activity?
(c)(3)s, (c)(4)s.
Tom Barthold
Well, in the case of (c)(3)s, remember that there's limitations on what there's definition of exempt purpose and it does not include political activity.
But can a (c)(3) give to a (c)(4)?
(c)(3)s can give to (c)(4)s.
Jason Smith
And so if foreign money came into a (c)(3), that (c)(3) still can give to a (c)(4).
That's correct, Mr. Chairman.
Jason Smith
So right now, under the current process and the current law, foreigners are able to indirectly fund political operations and political activities.
Jason Smith
Yeah, absolutely. And so anyone who's opposing Ms. Malliotakis's bill wants foreign dollars to stay indirectly into these political activities, because it's a fact. We can go through many organizations where foreign dollars come in to 501(c)(3)s, then converted to (c)(4)s, those (c)(4)s then are involved in political activities. But if we do it as members of Congress, we go to prison. But it's okay for these non-for-profits to do it.
I yield back. Ms. Moore.
Gwen Moore
Thank you so much, Mr. Chairman. Mr. Berthold, with regard to the Chairman's inquiries, 501(c)(4)s are not allowed under current law to engage in political activity that supports or is against a candidate. Am I—is that correct? Like a (c)(4) might be able to do political education, allowing people—letting people know that there is an election, maybe do some political training of young people in the community. A 501(c)(4) may do voter registration as non-partisan activity.
Is it or is it not true that any donations that go through a (c)(4), the (c)(4) activities are limited to non-partisanship? Is that or is that not true?
Tom Barthold
The substantial activity and purpose of (c)(4) is for social welfare, so that can include advocating certain outcomes, so it's not per se non-partisan.
Gwen Moore
Certain outcomes. Could a 501(c)(4) mobilize activities to support President Trump for election?
Gwen Moore
Minor part. I have never heard a (c)(4) do that. Would that be—is that something new? There must be Republican (c)(4)s that do that, because Democratic (c)(4)s do not do that. They tell people that, you know, November 4th, 5th, whatever it is, is election day.
Make sure you get out and vote. Make sure you turn in your absentee ballot. Is that not what (c)(4)s do? What would happen if a (c)(4)—ask your associate—had—would they lose their tax-exempt status if they indeed did that, send people to hit doors and say vote for Donald Trump?
Tom Barthold
As long as it's not the substantial activity of the (c)(4) organization, they can do get out the vote as you described, voter education.
Get out the vote naming the candidate.
Gwen Moore
This is brand new law, sir. I would, I would yield to, who else can I yield to, to sort of clarify this for me? I've never heard of this before. Anyone here like to comment on the activities of C4s? Are there, okay, thank you, Mr. Barthold.
Linda Sánchez
Mr. Barthold, I have a very straightforward answer, or question that I would love for you to answer. In the text of the bill, is there any definition that says that union dues are business expenses?
Speaker 40
I just asked for the text of the bill. Thank you for the answer, and I yield back.
Ron Estes
Additional technical questions? Seen none, we will move to strike the last word. Mr. Estes is recognized to strike the last word.
I move to strike the last word in support of Stopping Foreign Influence in Elections Act of 2026. As a proud representative from Kansas, I know our constituents expect American elections to be decided by American citizens and no one else. Thank you, Mr. Chairman. However, right now, dangerous backdoor allows foreign adversaries to launder dark money and drop it straight into our political system through nonprofit activists. This is not only wrong, but fundamentally endangers the security of our elections.
The Stopping Foreign Influence in Elections Act of 2026 slams the door shut on this avenue of abuse. For too long, certain tax-exempt entities have operated with impunity, taking foreign money with one hand and cutting checks to help political campaigns with the other. This bill establishes a strict escalating penalty framework to stop them. It says plainly that tax-exempt organizations can't use foreign dollars to influence our elections. Kansans are fiercely independent.
They will not sit idly by while dark foreign money pours into the Sunflower State to interfere with our elections and drown out the voices of Kansans. This bill draws a clear line in the sand. It closes the loophole, holds bad actors accountable, and protects the sanctity of the ballot box. Let's secure our democratic process, penalize those who compromise our sovereignty, and keep foreign money out of Kansas elections once and for all. I urge my colleagues to support this legislation, and I yield back the balance of my time.
Thank you.
Mr. Doggett.
Lloyd Doggett
While foreign money certainly shouldn't be permitted in any American election, this bill does not really further that goal. It's already illegal for a union, a charity, or any 501(c)(3) organization to solicit or accept foreign money in connection with an election. This bill is not new protection. What it is is a trap for law-abiding American organizations. Here's how it works.
Take any established nonprofit, a church that questions the brutality of ICE, a veterans' post that questions why American service members are being forced to die in a reckless war in Iran, a labor union, a conservation group. If it receives even a single gift from a single non-citizen within a two-year window, then the contribution it later makes is branded as, quote, disqualified, and it's hit with escalating penalties, 100% initially, rising to the loss of a tax-exempt status. And it makes no difference whether a single dollar that was received from a foreign entity was ever spent on the contribution.
It now penalizes grants to 501(c)(4) social welfare organizations. So a charity that supports an allied advocacy group, a union that funds its community arm, routine, entirely lawful transfers are now swept in. That is a major expansion of this bill, and it reaches into the everyday life of American civil society. Now I ask the question, well, who gets excluded? How does this bill affect them?
Whose money is safe and whose is not? Well, the for-profit multinationals and the American subsidiaries of foreign corporations that bankroll their advocacy, their political action committees, their money keeps flowing, untouched. It is non-governmental organizations, unions, charities, membership groups that speak up for working people, the environment, and children that are placed in the crosshairs. This is not a shield against foreign influence, it is a muzzle that has been fitted for one side only. And that's why the League of Women Voters, faith organizations, the ACLU, and dozens of others have urged the committee to reject this proposal.
I would have more understanding of this sudden Republican vigilance if it were applied evenly. This committee has previously demanded that the Future Farmers of America answer for its long-term sponsorship by Syngenta, a Chinese-owned company. Meanwhile, consider President Trump's own record. He took a quarter of a million dollars from that very same Syngenta, and I've heard no concern about that from colleagues, some of whom have certainly never declined a Syngenta political contribution. A royal from the United Arab Emirates put half a billion dollars, half a billion dollars, into Trump's personal crypto venture, nearly 200 million of it flowing straight into the Trump family.
And shortly after that, the administration just magically lifted export controls on our most advanced AI chips to a firm that comes under royal control. The steel for Trump's White House ballroom, donated by a company in Luxembourg, and within days, magically, that company was handed a tariff cut. And among the donors bankrolling the ballroom is Tether, a foreign-based crypto giant giving through an American arm, precisely the kind of foreign-linked corporate money that this bill leaves untouched. That is the pattern of foreign money reaching the president's businesses, favors flowing back to the same business. There's a word for that, and the word is not philanthropy.
I believe that we need to address the corruption that is plaguing our system. This bill would punish American charities and unions and spare the foreign-linked money that actually flows into a corrupt system and reach deep instead into the ordinary workings of civil society. I urge committee members to join the League of Women Voters and the many other organizations who've called on us to reject this proposal and do so quickly. I yield back.
Adrian Smith
Gentleman yields back. Ms. Sewell's recognized to strike the last word.
Terri Sewell
Mr. Chairman, I ask to strike the last word to oppose this bill. As a ranking member of the Election Subcommittee on the Committee on House Administration, I am constantly working on ways to make our elections more secure and expand access to the ballot box for all eligible American voters. We should all want to protect our elections from foreign interference.
In fact, it is prohibited to have foreign influence. But this bill falls far short of this goal. By defining 501(c)(4) social welfare organizations as political entities, this bill will have a chilling effect on the activities of charitable organizations that are working on critical community projects that have nothing to do with our elections. The Trump administration and congressional Republicans have lost all credibility on election issues. Republicans refuse to condemn President Trump's lies that he won the 2020 election.
Republicans continue to push the SAVE America Act, which is the broadest voter suppression effort since Jim Crow. And Donald Trump just fired the entire leadership of the U.S. Election Assistance Commission, which provides crucial assistance to states in running elections. If we were serious about securing and expanding our elections, we would all be calling out President Trump's lies and his dismantling of our democratic institutions, and we would pass the John Robert Lewis Voting Rights Advancement Act to restore the protections of the Voting Rights Act. This is not a serious attempt to protect our democracy. And for that, I ask and encourage my colleagues to oppose this legislation.
I yield back the balance.
The gentlelady yields back the balance of her time. Are others wishing to strike the last word? Mr. Schneider? Mr. Schneider is recognized to strike the last word for five minutes.
Bradley Schneider
Thank you. I move to strike the last word. Let me just start with saying that I want to echo the remarks from my friend and colleague from Las Vegas. Sorry, to echo the words of my friends and colleagues from Las Vegas about the committee. Specifically with this bill, though, I will note that the problem with my colleague's rationale for the bill is that the draconian penalties apply to contributions to a C4 organization that does not engage in political activity.
We're talking about an application to contributions to all C4 organizations, which I think is something that's of concern. Looking more broadly, I'm also baffled by the chaotic week that's unfolding in the House of Representatives. For example, as we sit here today marking up four bills, the committee gave only last-minute notice of the markup right before we head out for the August recess, giving members of this committee less than two days to parse through the full implications of bills that propose to make massive changes to how nonprofit organizations operate in the country. Last night on the floor, House Republicans passed a continuing resolution to fund the government for fiscal year '27 at fiscal year '26 levels through December, relinquishing entirely even the appearance that Congress can actually do its job and fund the damn government. God forbid with 10 weeks left before the end of this fiscal year, we actually try to roll up our sleeves and do the work necessary to advance and try together find common ground on a budget and funding bills that could actually pass both chambers of this Congress.
There are 10 weeks left. There's no reason why we are abdicating our responsibility and rushing out of town with a push-through continuing resolution through December. CRs are bad. They're bad for federal agencies, bad for our military, bad for state and local governments, bad for American taxpayers that we are here supposedly to represent and work on behalf.
Speaker 44
I am tired of watching the Republican majority put walls up around the most extreme policies of their own from their own conference and saying that this is our only offer. Refusing to budge on anything to help garner bipartisan support, support that is necessary for a budget to pass through Congress. I'm tired of the same scene playing out when Democrats aren't on the board to go along with whatever garbage they put in front of us when Democrats want to have a say in what's included if they want our vote, they pick up their ball, they cancel votes, they go home when they don't get their way. This year alone, votes have been cancelled 15 times. That's the equivalent of three weeks of snow days without the trace of snow.
And that's what's happening time and time again, including this week where we put a hyper-rushed partisan CR on the floor. We put it on 10 weeks before a deadline, sending everyone home and letting Republicans enjoy vacation. The dysfunction in this place is unmatched in history, and we can't keep punting on the important decisions Congress has to make. We have 10 weeks to do the job and fund the government before October 1st when the new year begins. But not with the CR, let's do it with the real budget.
We need to get serious. I yield back.
Linda Sánchez
Are there other members wishing to strike the last word? Ms. Sanchez is recognized.
Thank you, Mr. Chairman. While this bill may be well-intentioned, its consequences will harm American workers and the unions that represent them. This bill puts labor unions, trade associations, and other nonprofits at risk of being penalized for participating in the political process. Now, Ms. Malliotakis claimed that union dues are business expenses and that this bill would not harm union members. However, Mr. Barthold said that in this bill, there is no definition and no clarification anywhere that says that union dues are business expenses.
I haven't seen any section in the bill that says that, and if it were the case and that were true, why does every single union oppose this bill? Because they know that that is not true, and they know that this bill has a very real potential of hurting their members. Many major unions in the United States have international members, and this bill fails to address how their membership dues or agency fees would be treated. Does a union member paying dues in Canada count as an international contribution? Would that contribution force unions like the United Steelworkers or the AFL-CIO to pay a penalty?
Labor unions and trade associations also represent foreign nationals on American soil. Permanent residents who hold green cards or an immigrant holding a temporary visa may fall under the category of a foreign national. Under this bill, their routine payments could have a consequence to a union or trade association's ability to participate in the political process. By leveling penalties on contributions to political organizations, we are discouraging unions and trade associations and other nonprofits who have international members from participating in our politics. Now, if we want to have a meaningful, bipartisan conversation about the impact of money in politics and the need to get money out of politics, I am all ears.
But this bill will do nothing but harm working men and women. And for those reasons, I oppose this bill strongly and I urge my colleagues to vote no as well.
It just seems like Republicans can't help piling on working families that are struggling. On top of not addressing the high cost of housing, the high energy costs, the inflation's effect on the purchase of everyday goods like groceries, like beef and coffee. Instead of trying to address those, you guys just seem to be piling on with more bills that further undermine the average American worker's ability to have a voice in who represents them and who will fight for them. And so instead of addressing affordability, we have just another bill that's here to kick working families in the teeth. I cannot support it.
I urge a no vote on this legislation and I yield back the balance of my time.
Aaron Bean
Mr. Bean is recognized to strike the last word.
Good morning to you and good morning ways. Thank you very much, Mr. Chairman. I will stress my objection whenever somebody from this dais says profane words. How about that? Profanity is not, it's just ways is better than saying bad words up here.
And I know we want to say it sometimes for emphasis, but whether on either side of the aisle, let me state my objection. I didn't mean to or wasn't planning on speaking on this bill, but one thing that we agree on, or at least there I was led to believe we agree on, that foreigners shouldn't participate in American's elections. We can argue very well by ourselves without the rest of the world getting in on our argument. So we all say, you know, foreigners shouldn't participate in our elections. And so we do not allow a foreigner to give money to, I don't take money from foreign governments or foreign entities or foreigners.
That's prohibited. But we have presented evidence, Representative Malliotakis has presented evidence where foreigners have given money to nonprofits. They do that all the time and then these nonprofits then turn around and give money directly to candidates and participate in elections. That is a loophole. That's a backdoor that needs to be closed.
So even if you say, oh, this never happens, it does happen, but even if you say it never happens, do you believe that foreigners should participate in our elections? And I don't think you, I think we all agree we shouldn't. So I believe the correct answer is to vote yes on the Malliotakis bill that says Americans only should participate in Americans and let's close these loopholes which foreign billionaires, which she has already presented that evidence, let's stop that and let's make American elections American. And with that I yield back.
The gentleman yields back.
It's in the record. Mr. Schneider spoke the words, let's.
Linda Sánchez
Ah, okay. I'm sorry, I thought it was directed at me and I was uncharacteristically non-profane in my comments. Thank you, Mr. Chairman.
Gregory Murphy
Mr. Schneider, I'm going to call your mother and have her wash your mouth out with soap. So the charge is that Democrat C4s do not steer money to Democrat campaigns. A few minutes ago, my dear friend Ms. Moore told us that Democrat C4s, quote, they just don't do that. Touché. When referring to the idea that C4s receive money from C3s that originate from a foreign donor.
Not true. In fact, it's false. Let me, let me give you an example here.
I'd like to insert into the record an article from that grand, august journal Politico. This article shows that Hansjörg Wyss donated $31 million, $31 million from his C4 to the 1630 Fund, which is a DC-based nonprofit 501(c)(4) that operates as a major dark money hub for left-leaning progressive political causes in the US. In fact, the Politico described it as a massive force on the left. He did this during the 2020 election cycle, which contributed tens of millions of dollars to liberal super PACs. A concrete example, concrete, irrefutable, in the press, of an example of foreign dollars laundered into US elections for Democrats.
I'd like to insert yet another article into the record. This is from the National Review. Reported that Wyss also spent $57 million, I wish I had this money just to spend like this, during the 2024 election cycle, he exploited loopholes around foreign spending on American politics in order to promote left-wing causes. Just another example of 501(c)s behaving as Democratic money laundering schemes for foreign dollars. Hence the protest.
After the dollars are cleaned and anonymized, they're untraceable to a C4 and then to a Democratic super PAC. Guys, this is happening. Millions of foreign dollars straight into our elections supporting Democrat candidates. Lastly, I'd like to insert into the record Form 990 from the Berger Action Fund, which, as you are aware, contains no reference to a single one of these foreign donations to the 501(c). It's completely untraceable.
Our bill, Ms. Malliotakis, thank you for doing this, will change this. It's just trying to clean out foreign influence from our elections, which I believe should be something that all Americans want. So I would urge a full and unanimous vote in favor of this bill. Thank you, Mr. Chairman, I'll yield back.
Thank you. Ms. Moore.
Gwen Moore
Well, it is really so good to know, and I will be seeking my colleague out, Nick Sessions, to help move a bill that will repeal Citizens United. Because by far, I would say that the gentleman has not come up with any examples of the billions and billions of dollars that inure to the benefit of Republican candidates for offices up and down the ballot because of Citizens United. And so, given your remarks, sir, I would hope that you would join me and other colleagues on repealing Citizens United, a ruling that has really brought all kinds of corrupt money into our political system. And I will say that our inability, we have tried so hard to upend Citizens United, Democrats have, and the resistance has come predictably from the Republican Party because they, in fact, benefit from Citizens United. And so that list that you entered into the record, I would challenge you to find the numbers of Republican super PACs that have contributed to Republican candidates.
With that, I would yield back.
Adrian Smith
Are others wishing to strike the last word? Seeing none, I would, the chair would like to remind members of the House rules of decorum and ask all those present to refrain and to remember certainly those rules of decorum and also to refrain from engaging in personalities, including those aimed at the president. Seeing no members wishing to strike the last word, we will now move on to amendments.
Are there any amendments to the amendment in the nature of a substitute? Mr. Schneider's recognized.
Speaker 54
The chairman reserves a point of order. The sponsor of the amendment will suspend while the amendment is being distributed.
Mr. Kelly.
Speaker 55
Mr. Schneider, you may proceed. Thank you, Mr. Chairman. And Mr. Chairman, as we consider adding restrictions on allowable contributions and adding penalties for tax-exempt organizations for illegal political contributions in this underlying bill, I think it's important that this committee ensure the penalties on violations of the law prohibiting political interference from within, including from within the administration, match the severity of the crime as well. I hope my colleagues on this committee will vote to stand up to the blatant corruption in this White House and oppose political interference and IRS corruption. In fact, I assume everyone has seen that the acting chief counsel of the IRS and the Treasury assistant secretary for tax policy has been ousted from the department after warning the White House that their attempts to request or influence IRS audits was in violation of section 7217 of the Internal Revenue Code.
The acting chief counsel for the IRS warned the White House that its requests for IRS audits were blatantly illegal and was forced out of the department for speaking up. After warning the White House that their actions were violating federal law, this official was fired. That does not tell me that this administration wants to or intends to obey the law. It tells me that the administration has every intention to fill the position with someone who will do the president's bidding whether or not it is legal. Section 7217 is extremely clear.
It is unlawful for the president, the vice president, or any employees of the executive office of the president or vice president and all cabinet-level officials with the single exception of the attorney general to, quote, request directly or indirectly any officer or employee of the Internal Revenue Service to conduct or terminate an audit or other investigation of any particular taxpayer. Section 7217 also states that anyone who receives such a request must report it to the Treasury Inspector General for Tax Administration. Anyone who makes a request that is prohibited under this section or anyone who receives such a request and fails to report it to the inspector general can be punished for up to five years in prison and a $5,000 fine. It's worth repeating. The president cannot legally direct the IRS to audit or investigate any taxpayer.
And there's a reason that this law is on the books. President Nixon tried to weaponize the IRS to go after his enemies and in the aftermath, Congress, this body, acted in a bipartisan way to pass section 7217 to limit potential political interference in IRS operations.
Speaker 44
It is the duty of this committee to provide oversight to the IRS and to the Treasury and to ensure the integrity of our tax system. Every taxpayer should be able to feel confident that the IRS is not being used as a political tool or will not be used against them. And every single member of this committee should be outraged by the reporting of the firing and dismissal given the warnings. Last Congress, following the leak of a taxpayer of taxpayer information by an IRS contractor, Chris Littlejohn, my Republican colleagues on this committee proposed a bill to increase the maximum penalty for the illegal disclosure of taxpayer data, the Taxpayer Data Protection Act. During our consideration of that bill, Chairman Smith said, and I quote, increasing the maximum fine and imprisonment period for unauthorized disclosure of taxpayer information will help deter individuals from violating the trust of American taxpayers.
Surely the same should be true for violations of the law prohibiting political interference by the White House into IRS operations. So today I'm offering an amendment to increase the maximum penalty for violations of section 7217 to $250,000 and increase the maximum term of imprisonment to 10 years, the same levels that this committee passed with overwhelming bipartisan support under the chairman's Taxpayer Data Protection Act. This administration is eroding public trust in our tax system, and this committee cannot continue to ignore the blatant corruption. If this administration is illegally directing the IRS to audit the president's political enemies, the American people deserve to know and the officials responsible should be brought to justice. I urge all of my colleagues to support this amendment, and I yield back.
Speaker 56
Gentleman yields back. Mr. Kelly, do you insist on your point of order?
Speaker 59
Mr. Chair, I make a point of order against the amendment under clause 7 of House Rule 16. An amendment is not germane if its subject matter is different from that of the underlying measure. The subject matter of the measure before us is limited to the tax treatment of tax-exempt organizations that receive foreign contributions. The subject matter of the amendment is executive branch audits. Therefore, the amendment is not germane, and I urge the chair to sustain the point of order.
Speaker 58
Mr. Chairman. Mr. Schneider, as the sponsor of the amendment, do you wish to be heard on the point of order?
I do wish to be heard.
Please state your point.
Speaker 55
Thank you. The subject matter of this amendment or of this bill deals with the penalties of violating IRS code. This amendment does the exact same thing. I believe it is germane and should be considered by the committee.
Adrian Smith
I am prepared to rule. The amendment is not germane, and the point of order is sustained. The amendment is not in order given the details of the subject matter.
Mr. Chairman, I move to table.
Adrian Smith
Mr. Kelly moves to table. The question is on tabling the appeal of the ruling of the chair. Clerk call the roll.
Speaker 11
Mr. Buchanan. Mr. Smith of Nebraska. Yes. Mr. Smith of Nebraska, yes. Mr. Kelly.
Yes. Mr. Kelly, yes.
Adrian Smith
There being 24 yeses and 17 nos, the motion to table is successful. Are there other amendments at the desk? Mr. Horsford is recognized.
Speaker 54
Mr. Kelly. Gentleman reserves a point of order. The sponsor will suspend while the amendment is being distributed.
Mr. Horsford, you may proceed.
Steven Horsford
Thank you, Mr. Chairman. As I mentioned in my opening statement, it's time for members to walk the walk. The underlying bill makes it that even if one single dollar from a dues-paying member of a union comes from a foreign national, the entire union's voice is silenced. The Stopping Foreign Influence in Election Act will essentially gut workers from having their union able to represent them. That means that this bill would put unions in a position where they would have to choose between representing all legal workers in a bargaining unit or being able to fully participate in the political process.
It is estimated that 15% of union membership is foreign-born. We're talking about immigrants and US-born who build and serve our country every single day. For some unions, like the sheet metal or the steelworkers, or like LIUNA, we're talking about the fact that they have chapters both here in the United States and in Canada. It is unacceptable for any friend of labor to support a bill that limits hard workers' ability to have a say in shaping the laws that affect workplace protections, wages, and benefits. That is a choice no union should have to make.
So I offer a simple amendment. Make it clear to our workers that their voice can be heard. Make it clear that labor organizations are not targeted. I urge my colleagues to vote in favor of my amendment that allows unions a seat in creating policy without putting membership at risk. With that, I yield back.
Adrian Smith
Gentleman yields back. Anyone wishing to strike the last word? Seeing none. Question is on the adoption of the amendment. Those in favor say aye.
Those opposed, no.
The amendment is not adopted.
Yeas and nays are requested. Clerk call the roll.
Mike Thompson
So the yeses being 15 and the nos being 23, the amendment is not agreed to.
Are there any other amendments at the desk? Seeing none. The question is on the adoption of the amendment in the nature of a substitute. All those in favor signify by saying yes.
Speaker 65
Madam Chairwoman, I move that the committee favorably report H.R. 9771 as amended to the House of Representatives.
Speaker 11
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Kelly. Mr. Kelly, yes. Mr. Schweikert.
Mr. Schweikert, yes. Mr. LaHood. Mr. LaHood, yes. Mr. Arrington. Mr. Moore, yes.
Mr. Carey. Mr. Carey, yes. Mr. Larson.
Mr. Chairman, the ayes are 23 and the nays are 16.
Mike Thompson
So, there being 23 ayes and 16 nays, the motion is agreed to and H.R. 9771 as amended is ordered favorably reported to the House. Without objection, I ask that staff be authorized to make technical and conforming changes to H.R. 9771 and that members have two additional days to file with the committee clerk supplemental, additional, dissenting, or minority views. Our next order of business is H.R. 9721, the Fiscal Sponsorship Transparency Act, introduced by Representative Smucker. Representative Smucker has been a leading voice for bringing more accountability and transparency to America's tax-exempt sector, including authoring legislation this committee has approved to illuminate how funding flows overseas. I appreciate his ongoing advocacy on behalf of American taxpayers and urge my colleagues to support this legislation.
I am pleased to recognize the gentleman from Pennsylvania, Mr. Smucker, for an opening statement.
Lloyd Smucker
Thank you, Madam Chair. Very grateful that the committee is considering this legislation, H.R. 9721, the Fiscal Sponsorship Transparency Act. Fiscal sponsorship arrangements serve an important role in America's charitable sector, and the overwhelming majority of them are operated responsibly and in good faith. They can help launch new organizations, they can support worthwhile community initiatives, and allow charitable projects to operate under the guidance and oversight of an established tax-exempt organization. This legislation recognizes and preserves that important role.
However, the current lack of transparency surrounding some fiscal sponsorship arrangements can create uncertainty about how charitable donations are ultimately administered and whether the sponsoring organization is exercising the oversight that taxpayers expect. Taxpayers deserve appropriate transparency and accountability whenever the tax code provides favorable treatment for charitable contributions. That's why I'm leading this legislation to strengthen the integrity of fiscal sponsorship arrangements. This legislation strengthens public confidence in those arrangements by ensuring greater transparency and reinforcing the long-standing expectation that sponsoring charities exercise meaningful stewardship over charitable funds. The bill would require covered tax-exempt organizations engaged in fiscal sponsorship arrangements to disclose basic information on their annual Form 990.
Things like including the parties to the arrangement, the amount of funding involved, the charitable activities being supported, the individual responsible for administering the arrangement, and when the arrangement began and ended. These are common-sense disclosures.
They would help taxpayers, donors, and regulators better understand where tax-deductible contributions are going and who is responsible for ensuring that those funds are used for legitimate charitable purposes. The goal is to preserve legitimate fiscal sponsorship arrangements while closing loopholes that can be exploited by bad actors who misuse the charitable tax system. Americans are extraordinarily generous. They deserve confidence that their charitable contributions are being used as promised and that the tax benefits that Congress provides are accompanied by appropriate transparency and accountability. At the end of the day, this bill reinforces the charitable sector by strengthening public confidence in legitimate fiscal sponsorship arrangements.
We help preserve this valuable tool for the many charities that use it responsibly. I urge all of my colleagues to support this legislation. Thank you, Madam Chair, and I yield back.
Speaker 68
Thank you. I yield my time, Madam Chairman, to the gentleman from California, Mr. Thompson.
Mike Thompson
Thank you, Mr. Ranking Member. Madam Chair, fiscal sponsorship is one of the most important tools available to our nonprofit community. It allows new charitable projects to get off the ground before they receive their own tax-exempt status. It allows communities to respond quickly to emergencies, to support innovative ideas and raise money for worthwhile causes without waiting months or even years for IRS approval. Whether it's disaster relief effort after hurricanes, a community health initiative, an arts program, or a neighborhood organization trying to improve its community, fiscal sponsorship helps charitable work happen faster and more effectively.
A great example is Energy Prep Help, a fiscal-sponsored initiative based in Petaluma, California, in my district. It has helped seniors prepare for natural disasters like fires that happen in our area. Unfortunately, this bill risks doing just the opposite of ensuring our communities take care of one another. Instead of encouraging charitable innovation, it creates uncertainty. It establishes for the first time in federal tax law a statutory framework governing fiscal sponsorship arrangements, imposes new reporting requirements on nonprofits, creates new excise taxes on organizations and even their managers, and it leaves key terms like discretion and control to future Treasury regulations.
That uncertainty is exactly why the National Council of Nonprofits opposes this legislation and why the Council on Foundations has expressed serious concerns. The reality is that the overwhelming majority of fiscal sponsorships are legitimate. They allow experienced charities to provide administrative support so new charitable projects can focus on serving their communities instead of navigating complex tax rules. If there are isolated cases where organizations are abusing these arrangements, we should address those bad actors head-on. But we should not create a chilling effect that discourages legitimate charitable partnerships across our country.
We should be making it easier, not harder, for nonprofits to feed families, respond to disasters, support local arts organizations, improve public health, and launch innovative charitable programs.
This bill risks burdening the very organizations that are doing that work day in and day out. For those reasons, I urge my colleagues to oppose the bill, and I yield back.
Thank you. The committee will now proceed to consideration of H.R. 9721, the Fiscal Sponsorship Transparency Act of 2026. Without objection, the measure will be considered as read and open for amendment at any point. At this time, I offer an amendment in the nature of a substitute, which was distributed in advance along with a green sheet explaining it. Without objection, the amendment in the nature of a substitute shall be considered as read, open for amendment at any point, and considered base text for purpose of amendment.
I will now turn to Tom Barthold, the Chief of Staff of the Joint Committee on Taxation, to provide a technical description of the amendment in the nature of a substitute, with emphasis on the changes made since introduction. I ask that members hold their questions until after his presentation.
Tom Barthold
Madam Chair, the committee members have before them two Joint Committee documents, JCX-37-26 and JCX-41-26, which describe the underlying legislation and the chairwoman's amendment in the nature of a substitute. This legislation codifies a definition of fiscal sponsorship arrangement and requires expanded reporting of such arrangements undertaken by 501(c) organizations on their Form 990. The additional reporting would provide detail about the arrangements, such as specifics regarding the activities funded through the fiscal sponsorship arrangement. The legislation also codifies the regulatory notion of an improper conduit arrangement. As under present law, no charitable deduction is allowed to a person for a contribution made under an improper conduit arrangement.
The legislation further imposes taxes of 20% on the value of the improper conduit arrangement made by the organization and a tax of 5% on the value of the improper conduit arrangement upon the organization's manager, based upon the amount that was knowingly transferred by the organization. Failure to correct an improper transfer can lead to imposition of a second tier of taxes on the organization and the manager. This legislation would be effective for taxable years beginning after December 31st of 2027, and the staff of the Joint Committee on Taxation has estimated that this would have a negligible revenue effect during the budget period of fiscal years 2027 through 2036. That concludes my brief description. I'd be happy to answer any questions that the members might have.
Speaker 70
Thank you very much. Are there any technical questions about the amendment in the nature of a substitute? The chair now recognizes Mr. Thompson.
Mike Thompson
Thank you, Madam Chair. Mr. Barthold, thank you for being here today. I have a couple of questions. I understand that there was an arrangement between the National Park Service and the National Park Foundation to create the Freedom 250 LLC, which is a wholly owned entity of the National Park Foundation. On its website, the National Park Foundation states that it is responsible for providing, quote, "fiscal oversight to ensure Freedom 250 LLC properly distributes and accounts for project funds," end quote.
The bill contains a special rule for disregarded entities. Would this make Freedom 250's arrangement with the National Park Foundation a fiscal sponsorship arrangement under this bill?
Tom Barthold
Uh, Mr. Thompson, possibly. I don't have enough information to say whether the arrangement would be a fiscal sponsorship arrangement. The analysis would really depend on the exact nature of the agreement that has been made between the National Park Foundation and the Freedom 250 LLC, but it is possible.
Mike Thompson
Thank you. I understand also that there's an arrangement between the National Park Service and the Trust for National Mall for construction of a presidential ballroom. There's a written agreement between the parties that provides a management fee to the Trust for contributions made. Would this make the Trust's arrangement with the National Park Service for construction of the ballroom a fiscal sponsorship arrangement under this bill?
Tom Barthold
Mr. Thompson, as with your prior question, possibly. Again, we'd need further analysis. There's three parts to the definition of fiscal sponsorship arrangement, and to answer that, we'd need to know in more detail the exact nature of the agreement that you just described.
Mike Thompson
So if it were a fiscal sponsorship arrangement, would the Trust for the Mall have to disclose details regarding the activities of the Park Service with respect to the funds provided for the ballroom?
Tom Barthold
Yes, Mr. Thompson, under the proposed legislation, the additional reporting on Form 990 requires, among other things, details regarding the activities funded by the under the arrangement. So how much money is spent for this or how much money is spent for that.
Speaker 72
Thank you. I think we should clarify the treatment of these and similar entities under this legislation, and I yield back the balance of my time.
Speaker 73
Are there any other technical questions? Seeing none, does anyone wish to strike the last word? The chair now recognizes Congressman Doggett from the great state of Texas for five minutes.
Lloyd Doggett
Thank you. Our Republican colleagues had a choice to make today. They could have chosen to deal with the affordability crisis with which one American family after another is struggling. Struggling from lost healthcare forced on them by these Republicans, millions who don't have access to a family physician as a result of their costly legislation. Millions that are struggling with paying the illegal Trump tariffs, the tariff taxes about which these previous free traders have been totally silent in the Trump era.
Or those who are suffering as a result of his reckless war in Iran, paying these huge prices for gasoline, food, and most everything else. But instead, they chose instead of American affordability, that what they would focus on today is giving Trump more weapons to maintain his regime. And like authoritarians around the world, to attack non-governmental organizations that he cannot control. And so what they've done today is to invent a new tax that can be imposed on non-governmental organizations, community organizations, that is triggered by the undefined phrase, "an organization that fails to exercise discretion and control over the use of its funds." Now, neither of the terms there is defined in the bill.
The bill never says who decides this, by what measure, or whether a charity ever sees the evidence or even has the right to appeal after summarily facing penalties. So the Trump administration can set a trap, that's what this legislation and the other bills we've considered today are all about, trapping those who don't heed to the Trump regime dogma. And they can decide whether a community organization has "corrected" and after the administration says no, it can confiscate a donation. This is oversight, this is intimidation. That's why the nonpartisan National Council of Nonprofits has warned that this legislation will chill lawful activity, that fiscal sponsors will refuse the risk, and that casualties will be some of the smallest, most local groups, a PTA, a youth league, a volunteer group that uses a sponsor because they don't really want or cannot afford a back office.
And remember that fiscal responsibility or sponsorship under this bill is something that's important to a brand new charitable effort that would otherwise have to wait months for the IRS to recognize its tax-exempt status. And a fiscal sponsor lets it begin the work now, receiving tax-deductible support under the wing of an established charity until they can stand on its own. This is even more important now that DOGE and Trump have really eviscerated the IRS workforce so taxpayers can't get timely responses. It's how a relief group can open a tent clinic in the days after a hurricane, or a town can pull together resources to celebrate its America's 250th celebration, how a small short-lived project shares one back office rather than building its own from scratch. This is not some clever loophole, it's been the law since at least the 1950s and today it stewards more than $3 billion a year for charitable organizations all over this country.
Republicans claim that they're keeping charitable dollars from going into malign unlawful ends, even terrorism. But the administration already has plenty of tools to stop charities from engaging in any unlawful activities. It's already a federal crime to send any group designated a terrorist organization a single dollar. We need not guess what lies ahead if this tool is granted to the administration. Because the administration recently fired a fellow named Ken Kies, who's well known in this room.
I think he's had his fingerprints on most every loophole Republicans have placed in our tax code over the last decades. I've fought with him unsparingly, day after day, and yet to his credit, though we disagree so severely about tax loopholes and special advantages, he had the courage to say no to the weaponization of the tax code and as a result, even though he was personal lawyer to President Trump in his various tax avoidance schemes, he's been dismissed. As have others unwilling to weaponize the IRS against Trump's political enemies. This bill does nothing for oversight and everything for intimidation and we've seen how this administration will weaponize the IRS against American citizens in ways that even President Nixon never envisioned. I yield back.
Speaker 71
Does anyone else wish to strike the last word? Recognize the chair recognizes Mr. Beyer from the great state of Virginia for five minutes.
Donald Beyer
I'm deeply concerned that this bill is not ready for prime time and desperately needs stakeholder input. I want to thank Congressman Doggett for explaining how the fiscal sponsorships really work. Nonprofits and foundations support a number of critical roles in our society: affordable housing, healthcare access, food, workforce development, education, disaster relief, environmental conservation, and many more fundamental societal services. And they're often the most trusted organizations in our society. They're also our society's third largest employment sector.
Madam Chair, thank you very much.
Fiscal sponsorship is one of the key ways to support and advance key charitable projects and has been a long-established method to get new charitable initiatives off the ground. There are good reasons why charitable work can take the form of fiscal sponsorship, like responding to urgent needs, testing new ideas, or undertaking time-limited initiatives. My great concern is that this bill doesn't match the current use of fiscal sponsorships. It would include things not normally attributed to fiscal sponsorships and not include others that typically would be. Vague and improper definitions are not just a problem in this bill, they have real-world consequences.
The bill has employees facing potentially harsh penalties for failing to exercise proper discretion and control. The lack of definition of discretion and control could potentially stifle fiscal sponsorship because organizations will not be willing to accept an undefined level of risk. A nonprofit would be liable even if they did not know or have reason to know that the arrangement was improper, and they wouldn't be provided an opportunity to avoid liability if they corrected the issue. When statutory definitions remain vague, organizations are vulnerable to subjective enforcement and severe tax penalties before Treasury regulations are finalized. And with personal liability risk, literally personal excise taxes on organization managers, it could deter volunteer directors and board members from serving on nonprofit boards due to fear of unexpected personal financial liability.
Another concern I have about the bill is that given the lack of standards for individual projects, this bill would potentially subject very small initiatives to these requirements and make them prohibitively difficult to operate. I worry as written that they could inadvertently force tax-exempt charities to report on routine internal programs, grants, or standard restricted funding agreements. You know, I've been on a lot of nonprofit boards over the years, and usually Americans are very critical of organizations that spend their contribution money more on the administrative side than rather than just doing direct service that helps people. But this bill's going to do exactly the opposite. It's going to force lots more administrative side work.
In sum, the bill creates enormous financial and legal risks for fiscal sponsors, chilling lawful activity. And many fiscal sponsors will be unable to accept the increased risks, and they may decide not to act as a fiscal sponsor. Especially in a country where we rely on our charities so very, very much, this is definitely a move in the wrong direction. It's going to leave communities without important fiscally sponsored projects. And I confess this bill feels to me more politically motivated to target a few, a few, very few high-profile politically oriented fiscal sponsorship networks, the ones we can attack with existing law.
But the practical reality of the bill is that it imposes harsh regulatory burdens and penalties on tens of thousands of community-based charities. Madam Chair, I yield back.
Speaker 74
Thank you very much. Are there any other statements? No. The chair now recognizes Mr. Smucker for five minutes.
Lloyd Smucker
Thank you, Madam Chair. I started my comments saying that almost all or most fiscal sponsorships are indeed doing good work and are operating as they should, but there are clearly examples that we've heard in hearings here where that is not the case. I just wanted to address some of the comments that were made. Again, this is about transparency. And all we're asking simply is for more transparency about where those dollars are going, how taxpayer dollars or contributors who are giving their dollars to charitable contributions to organizations, they really should be able to track how that money is being used.
And that's the purpose of this bill. So again, it's about transparency so that the public can understand and track those dollars. On the issue that was brought up on discretion and control, it's a fair point. The standard is not included in this bill, but it directs the Secretary of the Treasury to come up with those regulations during rulemaking, as we do in many bills. And that would be done well before the bill goes into effect.
Remember, the effective date is not until December 31st of 2027, which will provide time for Treasury guidance and also stakeholder input, as is the case with many bills, before any of these obligations take effect. So as I said, it's a fair point, but that will be addressed as the rulemaking for this bill takes place. Thank you, Madam Chair.
Are there any other members wish to strike the last word? Not seeing any, are there any amendments to the amendment in the nature of a substitute? The chair recognizes Mr. Thompson for five minutes.
Speaker 76
Madam Chair, I reserve a point of order. The clerk will distribute the amendment, and I ask the gentleman to suspend while the clerk distributes. All right, the gentleman from California is recognized for five minutes to speak on his amendment.
Mike Thompson
Thank you, Madam Chair. I must admit this bill is a little hard to take seriously. We're told this legislation is all about transparency. We're told Congress needs to crack down on fiscal sponsorship arrangements because the public deserves to know how charitable dollars are being raised and how they're being spent. Apparently that principle applies to everyone, everyone except the White House.
Right now, a Section 501(c)(3) organization is raising hundreds of millions of dollars for the President's proposed White House ballroom. Under its agreement with the National Park Service, donors can remain anonymous to the maximum extent permitted by law. The organization also retains an administrative fee from the funds it raises. Enter into the public record, I'd like to enter into the public record this statement that I have. Thank you.
So while this bill imposes new reporting requirements, new penalties, and new compliance burdens on charities across our country and in our districts, the administration is overseeing an arrangement where the American people may never know who's writing the biggest checks for one of the most high-profile projects in our country. That's not transparency. It's a double standard. If the majority truly believes these arrangements deserve greater scrutiny, then the very first arrangement we should scrutinize is the one connected to the White House.
My amendment requires the names of the ballroom donors and the amount of every donation be publicly disclosed. If there's nothing to hide, there should be no objection. If this bill is really about restoring public confidence, then let's start with the project in the president's backyard. The American people deserve to know who's financing a four hundred million dollar White House ballroom. They deserve to know whether anyone seeking influence or anyone seeking access is helping to fund it.
And they deserve to know before Congress starts imposing new transparency requirements on every other nonprofit across our country. We should not have one set of rules for Main Street charities and another for projects benefiting those in the highest positions of power. Transparency is either a principle or it's a talking point. I urge adoption of my amendment.
Thank you very much. Does anyone wish to strike the last word? All right, seeing none. The question is on agreeing to the amendment offered by Mr. Thompson. The clerk will call the roll.
Mr. Buchanan. Mr. Smith of Nebraska.
Speaker 11
Mr. Davis, yes. Ms. Sanchez. Ms. Sanchez, yes. Ms. Sewell. Ms. DelBene.
Ms. DelBene, yes. Ms. Chu. Ms. Chu, yes. Ms. Moore. Ms. Moore, yes.
Mr. Boyle. Mr. Beyer. Mr. Beyer, yes. Mr. Evans. Mr. Evans, yes.
Mr. Schneider. Mr. Schneider, yes. Mr. Panetta. Mr. Gomez. Mr. Gomez, yes.
Mr. Horsford. Mr. Horsford, yes. Ms. Plaskett. Mr. Suozzi.
The clerk will report the vote.
Mike Thompson
The yeses being 15, the nos being 23, the amendment is not agreed to. Are there any other amendments to the amendment? Seeing none, the question is on the adoption of the amendment in the nature of a substitute. All those in favor signify by saying yes. Those opposed, no.
Speaker 75
Mr. Chairman, I move that the committee favorably report H.R. 9721 as amended to the House of Representatives.
Mr. Estes.
Mr. Hern.
Chairman Smith, yes.
Jason Smith
The clerk will report the vote. There being 23 yeses and 15 nos, the motion is agreed to, and H.R. 9721, as amended, is ordered favorably reported to the House. Without objection, I ask that staff be authorized to make technical and conforming changes to H.R. 9721 and that members have two additional days to file with the committee clerk supplemental, additional, dissenting, or minority views. Our last order of business is H.R. 9722, the Fair Treatment of Religious Organizations Act of 2026, introduced by Representative Moore of Utah.
I commend Representative Moore for recognizing the need to proactively defend the rights of faith-based organizations, including prohibiting the IRS from determining that an organization's religious beliefs or practices are inconsistent with law or public policy. Representative Moore's steadfast commitment to uphold our nation's constitutionally protected freedom of religion is to be applauded. I urge my colleagues to support this legislation and I'm pleased to recognize the gentleman from Utah, Mr. Moore, for an opening statement.
Blake Moore
Thank you, Mr. Chairman, thank you for holding this markup today and for including my bill, the Fair Treatment of Religious Organizations Act. Our committee provides important oversight of federal agencies and I'm grateful for the opportunity to contribute to that work. I'm immensely proud to represent one of the most religious and charitable states in the nation. Churches, religious nonprofits, and other faith-based institutions provide incredible services and opportunities for so many people across our nation. These organizations contribute billions of dollars to our economy, but most importantly, they strengthen our communities and help Americans find purpose and meaning.
Religious freedom is central to who we are as a nation, and what makes that freedom so powerful is the fact that our government does not get to decide what beliefs are acceptable. I introduced the Fair Treatment of Religious Organizations Act to ensure there was no encroachment on that freedom. It provides standards to prevent federal overreach into the beliefs of religious organizations and prevents the IRS from making tax-related determinations based on a religious belief on marriage, sexuality, and gender identity. So to provide some context, the 2020 Supreme Court decision in Bostock versus Clayton County held that Title VII of the Civil Rights Act of 1964 prohibits employment discrimination based on sexual orientation and gender identity. Justice Gorsuch, his majority opinion acknowledged the tension this ruling would create with religious employers, noting that they are also deeply concerned with preserving the promise of the free exercise of religion enshrined in our Constitution.
That guarantee lies at the heart of our pluralistic society. The tension that Justice Gorsuch detailed is what this bill aims to fix. There should never be a situation where the president can administratively decide that the beliefs of a religious institution are fundamentally against the interests of the United States and certainly should not be a determining factor for tax-exempt status. Unfortunately, previous administrations have abused this power as they've made these kinds of decisions. The Obama administration's IRS singled out conservative groups with extensive delays and questioning, the Biden administration denied tax-exempt status to a nonprofit because their beliefs were typically affiliated with the Republican Party.
There's really nothing stopping a future president from abusing this again. This is what I'm working to solve and get this off the table. Rather than leaving religious organizations dependent on case-by-case litigation or shifting administrative interpretations, this bill creates clear, enforceable standards that end the debate before it begins. This bill does not prescribe the religious beliefs that will be protected and protects against an administration from doing the same. Rather, the Fair Treatment of Religious Organizations Act limits government overreach, provides interpretive stability for religious organizations, and ensures equal treatment of belief.
I urge my colleagues on both sides of the aisle to vote in favor of this bill and ensure that the promise of religious freedom can be guaranteed for all. With that, I yield back.
Richard Neal
I now recognize the ranking member.
I was prepared to point out that the gentleman from Texas was on the House floor and I was going to ask the indulgence of the committee to allow him to offer a post-opening statement. But since he's arrived and has asked me to filibuster while he gets his notes straight right here, I'm in full cooperation with the gentleman as I keep talking and as soon as he puts his thumb up, he will be ready to go. We await.
Lloyd Doggett
Thank you, Mr. Chairman, for your understanding. Over 40 years ago, the Supreme Court affirmed that Americans should not be forced to help an organization whose core practices violate fundamental public policy or promote illegal conduct. That was in the Bob Jones University case, where Bob Jones claimed its religious beliefs permitted it to reject any student who is married to a person of a different race. The Supreme Court rightly said you're entitled to your religious belief, but you're not entitled to require taxpayers to accept an unacceptable practice. This bill would essentially repeal the Supreme Court decision in Bob Jones and go much further by decreeing that any belief or practice concerning marriage, sexuality, or gender identity can never again be treated as inconsistent with law or public policy.
Nor need such a belief be a central tenet of the particular faith; it can be a marginal or incidental consideration. This bill directs the IRS to ignore a group that invents a belief tomorrow purely to discriminate, with no grounding in religious tradition. The Supreme Court decades ago rejected state prohibition of interracial marriage, but under this bill, all it takes is a professed belief that marriage must be within a single race, white nationalism, to justify employment discrimination. Similarly, six years ago, the Supreme Court held that firing a person for being gay or transgender constitutes illegal discrimination. But this legislation would protect the tax-exempt status of a religious charity or, say, a disaster relief organization that fired an employee of its own faith for marrying her wife.
This is a roadmap around the non-discrimination laws of multiple states and cities across our country. One of the many reasons that I respect my colleague from Utah, who offers this amendment, is because he had the courage as one of 47 House Republicans to support the Respect for Marriage Act, to write into federal law the recognition of same-sex and interracial marriages. So this isn't a debate about whether those marriages are valid; he and I agree there. Here is where we part ways: he believes an organization should be able to keep its taxpayer subsidy while discriminating against the very marriages that both of us voted to protect. I don't.
Every American should be assured of equal dignity regardless of who they love, and our communities are stronger, our economy is healthier—Austin, Texas, is a great example of this—when everyone can contribute fully and without discrimination. We should not recognize a family's marriage with one hand and fund discrimination against it on the other. Nor does this bill operate in a vacuum. It arrives amid a sustained campaign: state resolutions from Republican groups demanding the reversal of the ruling on gay marriage, justices openly inviting another challenge, a deliberate culture of fear that's meant to pressure people out of living as who they are. That is how authoritarianism works: it rewards those who fall in line and punishes everyone else, and this bill would again make our tax code one more weapon in that awful campaign.
But as written, this bill goes much further than anything that I believe the sponsor really has in mind.
That'd be covered and excused by this bill. The tax court in 2010 made a decision that denied tax-exempt status to an organization whose stated purpose was to discriminate, excuse me, to decriminalize sex between adults and children and eviscerate our child pornography laws because the purpose was contrary to public policy and promoted criminal conduct. The public policy doctrine is being stopped today. This bill strips this tool away for anything relabeled as a religious belief about sexuality, handing the worst actors imaginable a roadmap to wrongdoing. Religious freedom is a bedrock American value that all of us support, already protected by the First Amendment and exemptions in our civil rights law.
I believe that this particular misguided bill represents a permanent taxpayer-funded license to discriminate and could facilitate very dangerous conduct that I'm sure the author does not support. I urge my colleagues to reject it.
Jason Smith
The committee will now proceed to consideration of H.R. 9722, the Fair Treatment of Religious Organizations Act of 2026. Without objection, the measure will be considered as read and open for amendment at any point. At this time, I offer an amendment in the nature of a substitute which was distributed in advance along with a green sheet explaining it. Without objection, the amendment in the nature of a substitute shall be considered as read, open for amendment at any point, and considered base text for purpose of amendment. I will now turn to Tom Barthold, Chief of Staff for the Joint Committee on Taxation, to provide a technical description of the amendment in the nature of a substitute with an emphasis on the changes made since introduction.
I ask that members hold their questions until after his presentation.
Tom Barthold
Mr. Chairman, the members of the committee have before them two Joint Committee documents, JCX-38-26 and JCX-42-26, which describe the underlying legislation and the chairman's amendment in the nature of a substitute. As was noted, under common law public policy, the common law public policy doctrine, an organization's not organized or operated for an exempt purpose if a purpose of the organization is contrary to fundamental public policy or is illegal. The proposal before the committee today would establish that a religious belief or practice concerning marriage or concerning sexuality or concerning gender identity is not inconsistent with law or with fundamental public policy. This provision would be effective for tax years beginning after December 31st of 2025, so effective as of the current year. The chairman's amendment in the nature of a substitute has made grammatical corrections, changing plural nouns to singular nouns in appropriate places in the legislation.
The staff of the Joint Committee has estimated that this would have no budgetary effect over the budget period of fiscal years 2027 through 2036. That concludes my brief description. I'd be happy to answer questions that the members might have.
Judy Chu
Thank you. Are there technical questions to the amendment in the nature of the substitute? I recognize Ms. Chu from California.
This bill would prohibit the IRS from treating a religious organization's beliefs or practices concerning marriage, sexuality, or gender identity as inconsistent with law or public policy for purposes of determining tax-exempt status.
It also provides that a belief cannot be denied protection simply because it is not central or compelled by a particular religion. As drafted, this is an extraordinarily broad exception that could preserve federal tax benefits for organizations espousing deeply harmful or discriminatory beliefs. So, Mr. Barthold, I'd like to better understand just how broad these protections are. As a threshold matter under this bill, a religious organization's beliefs or practices concerning marriage, sexuality, or gender identity could not be treated as inconsistent with law or public policy when determining its tax-exempt status. Is that correct?
Judy Chu
So I'd like to ask about a few examples. If an organization's religious belief on marriage is that 10-year-old children should marry adults, would this disqualify the organization from tax-exempt status?
Tom Barthold
The organization would not appear to be disqualified, but remember, Ms. Chu, there is a broader context for the organization. A charitable organization must be organized and operate under the laws of a particular state, and so the bill addresses IRS determinations, it does not directly affect state law, and so an organization that might promote this may well not be able to be incorporated in the state just as a threshold matter.
Tom Barthold
As a general matter, it does not appear to be automatically disqualified.
Judy Chu
Okay. What if an organization's religious belief on marriage includes and promotes polygamy? Would this disqualify it from tax-exempt status?
Again, as a general matter, would not appear to be disqualified.
Judy Chu
Yes, I understand. The answer is the same, no. What if an organization's religious belief on marriage discriminates against interracial marriage? Would this disqualify it from tax-exempt status?
Judy Chu
Yeah, okay. No. What if an organization's religious belief on sexuality or gender identity is that all LGBTQ people should be jailed? Would this disqualify it from tax-exempt status?
Tom Barthold
Well, again, I would say as a general matter, it would not be disqualified.
Judy Chu
Okay. The answer is no. Under this bill, if an organization's religious belief on marriage is that all husbands should be able to rape their wives, would this disqualify the organization from tax-exempt status?
Tom Barthold
Again, Ms. Chu, getting beyond what would be legal under the state's law, the IRS determination would not be defining what practice is as a religious practice.
Judy Chu
Yeah, the answer is no, I get it. What if an organization's religious belief on sexuality advocates for decriminalizing child pornography? Would this disqualify it from tax-exempt status?
Tom Barthold
Again, this legislation addresses how the IRS treats a religious belief or practice. I should note in the case of 501(c)(3) organizations, you still have to meet the general tax-exempt purposes, one of which is the protection of children.
Judy Chu
Well, I think the answer is similarly no. What if an organization's religious belief on sexuality advocates for bestiality? Would that disqualify it from tax-exempt status?
Judy Chu
No. Well, thank you, Mr. Barthold. Rather than simply protecting religious liberty, this bill would prevent the IRS from considering whether some of the most egregious, backwards, and disgusting practices are inconsistent with long-standing public policy when determining eligibility for valuable federal tax benefits. We must do better than this. I yield back.
Ms. Moore.
Gwen Moore
Thank you, Mr. Chairman, for yielding. Mr. Bartold, I want to follow up on an answer that you gave Ms. Chu. You said that, uh, that states would have to follow, that practices would have to be, uh, done in the context of whatever state law was. Seven, only 17 states have declared child marriages illegal. So if there is a state that doesn't have a law, uh, against child marriages, then, uh, the example that Ms. Chu gave, a 10-year-old, and this has been, we have had 10-year-olds being married off to much older men, that would not be disqualifying, uh, under this bill.
Is that, is that correct?
Tom Barthold
Well, uh, Ms. Moore, again, the bill addresses, uh, IRS determinations of tax-exempt status under 501(c)(3), and it precludes the IRS from considering certain religious beliefs or practices in that determination. Under, in the case you mentioned, uh, another aspect of being qualified organization in under 501(c)(3), uh, is, uh, organizations that, uh, promote or protect child, uh, child welfare or child abuse. So in terms of an overall determination of an organization, there are, there are multiple, uh, things that the IRS looks at. It looks at the stated purpose of the organization and also the activities. So what does the organization say its principles are, what does it do to carry out those, out those principles?
Gwen Moore
Well, I, I think that's great, Mr. Bartold, and I don't want to put pressure on you. The only thing that I'm trying to determine here is that the IRS would not be able to use as a pretext for taking away your 501(c)(3) status that you have, that, that the church or organization has performed marriages to a 10-year-old. Uh, their purpose is a religious purpose and, uh, they say your soul needs to be saved, you need to be married when you're 10 years old. The IRS would be precluding, precluded for using that as a pretext for taking away their status. Is that, am I correct?
Tom Barthold
I, I think if we've determined that that's a reli, uh, a valid religious practice, however that might be interpreted.
Gwen Moore
Right, I, I'm just thinking of cases like with Warren Jeffs and so forth that married off kids 12 years old and so forth, who are in jail now. This would overturn that.
Tom Barthold
Well, it, remember it does not change state law. If a person was put in jail for that purpose, this, this is really only about an organization seeking 501(c)(3) status.
Gwen Moore
So, so the 43 or 33 states that allow child marriage, uh, then they would be able to continue that practice under this provision and not be penalized with regard to their, their 501(c)(3) status.
Speaker 78
If an organization ad, uh, if that was part of its purpose, uh, what you've stated is correct, Ms. Moore.
Thank you so much, sir. And I yield back.
Lloyd Doggett
So if I understand your answers, if Mr. Epstein had used a nonprofit for his grooming of underage girls and all of the abuse that has traumatized our whole country, the IRS couldn't do anything about it under this bill as long as it claimed it was part of a religious practice.
Tom Barthold
Taking it, assessing only the religious practice aspect of it, yes, is removed. But there are other things that the IRS would look at in terms of determining the validity, and it could include, I don't know what the laws were in the state that Mr. Epstein would create this organization, but it could well be that everything you just mentioned is illegal in that state. And that would give the IRS—
Lloyd Doggett
That's all well and good, but as far as the powers of the Internal Revenue Service, they're being disarmed in this bill by the claim of religious practice, and someone who engaged in the very kind of conduct that's been covered up with reference to Mr. Epstein could get away with it as far as the IRS is concerned. It's very troubling to see how this weave of misconduct interconnects. I yield back.
Jason Smith
Additional technical questions? Seen none, we will move to strike the last word. Mr. Moore is recognized to strike the last word.
Blake Moore
Thank you, Chairman. I'll just reiterate, Ms. Barthold, I appreciate your clear responses on this. This doesn't take away even the examples, and I get why we want to share a bunch of really absurd examples and things like that, but this legislation would never supersede the very legal authority you've mentioned. State law will continue with that that actually makes all of that criminal activity. It doesn't do anything with respect to that.
This is a very narrowly—this bill forecloses one narrow legal authority as applied to marriage, sexuality, and gender identity beliefs. It does not and cannot by its text legalize marriages that violate state or kinship laws. It leaves intact the independent broader internal revenue toolkit, including the operational test, illegality doctrine, the private inurement rules that the IRS would use against any organization actually facilitating unlawful marriages regardless of that religious framing involved. We can come up with a lot of examples that are going to catch a headline or something to that nature, but let's talk about what the reality of this is. It doesn't change any of those things that make all that stuff illegal, things that you even brought up.
What it does, it narrowly defines this and is not going to force a religion to go against its beliefs, and this is a good-intent, good-faith piece of legislation that is far more narrow and doesn't affect any of the legal authorities that already exist. Even the Bob Jones, the United States versus Bob Jones University, that remains good law and not related and touched in this in any way. And I appreciate the dialogue, but I want to at least reiterate the legality that makes all that stuff illegal is still fully in place and enforceable. And I yield back.
Mr. Davis.
Danny Davis
Thank you, Mr. Chairman. I move to strike the last word. Mr. Chairman, I am deeply troubled by H.R. 9722, the Fair Treatment of Religious Organizations Act of 2026. While the bill's title promises fairness, its substance, however, delivers the exact opposite, compromising the fundamental protections and fair treatment of millions of Americans.
In fact, as drafted, this bill would sanction unfairness and discrimination by religious organizations by amending section 501 of the Internal Revenue Code of 1986 to add that a religious belief or practice concerning marriage, sexuality, or gender identity should not be treated as being inconsistent with law or public policy. The bill would also stipulate that a belief shall not fail to be treated as a religious belief merely because such belief is not compelled by or central to a system of religion. In other words, H.R. 9722 essentially permits tax-exempt religious organizations that exercise or practice child or polygamous marriage, that prohibit interracial or same-sex marriage, or that condone sexual behaviors such as child pornography to exist. For these reasons and others, I absolutely cannot support this harmful bill. A bill that basically dismantles decades of hard-won civil rights and erodes the fundamental principles of equal opportunity and equal treatment.
The bill before us in its current form is opposed by the Congressional Equality Caucus, Human Rights Campaign, Interfaith Alliance, the National Women's Law Center, Americans United for Separation of Church and State, and the Baptist Joint Committee for Religious Liberty, and rightfully so. The measure creates a different standard for tax-exempt status when it comes to organizations' practices that relate to marriage, sexuality, and gender identity by carving out those practices from the law's requirement that practices can't contradict public policy. Moreover, the bill permits religious organizations to discriminate, including against interracial couples, and still receive tax-exempt status. This is unacceptable, un-American, and unconstitutional. Freedom of religion is a fundamental American value, and religious exemptions already exist on the books for both federal non-discrimination laws and, when appropriate, the Constitution.
Therefore, I contend that this bill does more harm than good and should be rejected. Instead of considering bills that further divide us, I urge the committee to focus more on meeting the urgent needs of struggling families who are losing healthcare, can't afford food and gas, and are paying more than 30% of their income for rent. In Illinois, we're seeing family farm bankruptcies surge by 55% and long-term unemployment is increasing. Therefore, I would urge that we reconsider advancing this bill as it establishes a dangerous and lasting loophole in our civil rights protections and non-discrimination laws related to sexual orientation, gender identity, and marriage. It is not good for America.
Therefore, I would urge that we reconsider, not pass it, and I yield back.
Gwen Moore
Are there additional members that wish to strike the last word? Ms. Moore.
Thank you so much, Mr. Chairman, and I move to strike the last word. Representative Moore, I have no doubt that this was offered in good faith, but this is not good for the country. You have heard the arguments by Dr. Davis, Dr. Chu about child marriage, which is unhealthy for women. If you're 14 years old and an adult male has sex with you in America, that's called, that is sexual assault. That is called statutory rape.
And this particular bill would really upend that notion. If there were a state that allowed child marriages, and of course there are 33 that do, then the IRS would be mum with regard to taking away that status. I just want to say, sex is not for children, and it's not for girls. There are data, there are studies, we need to do more studies on it, but child marriages have resulted invariably in domestic violence. It has resulted in women not being able to fulfill their educational needs and desires.
It has pitted women and families into deep poverty because of forced marriages. Women have been abused through immigration policy where they've been forced to marry someone in both directions, American citizens and citizens of other countries, in order to facilitate some man's immigration status. And this bill would fully facilitate that. Representative Moore has indicated to us that what we have done is brought up just rare cases, you know, of child marriages, you know, like, you know, it is not rare, unfortunately, these child marriages. Data show that between 2000 and 2018, more than 300,000 children under the age of 18 were married in the US, some as young as 10, and married, of course, to older men.
I remember once when the, when we had an audit of why Milwaukee continued to appear on the list of out-of-wedlock pregnancies for a decade, for over a decade, United Way did a study in our region and found out that it's because of statutory rape. It's because kids, I personally know of girls who've had babies at age 12, 13, and of course they are unable in many cases to have children in the future because it's just, they're not physically ready to have babies at age 12 and 13. It is unfortunately not rare. And the United States has been a leader in efforts to end child marriage internationally, but we've failed to take steps on this issue in our own backyard.
My time is winding up, but I would hope that we would establish a national commission to combat child marriage to study, evaluate, and report on eliminating child marriage in the US, providing states that have already ended child marriage with increased Violence Against Women Act grant funding, establish a competitive grant program for states to create dedicated task forces to examine and make comprehensive policy recommendations to address child marriage, and prohibit child marriage from occurring in or on property owned or funded by the federal government, such as military bases. These are recommendations from the Tahirih Justice Center. They are supporting the bill that I have dropped, and it has support from both chambers to prevent child marriages. It is unhealthy for women. And before I end this particular mention, I am also going to be offering an amendment to prevent child marriages, and I'm also going to offer an amendment to prevent female genital mutilation, which this bill would authorize under the pretext of religious ceremonies.
And so with that, I would yield back to you, Mr. Chairman, and thank you.
Michelle Fischbach
Mr. Chair, I move to strike the last word. I yield my time to Mr. Moore.
Blake Moore
Thank you to the gentlewoman from Minnesota. Let me just reiterate the hypotheticals and the issues in this situation and the crimes that my colleagues have said most recently from my friend from Wisconsin. These are already federal crimes. Nothing in this legislation changes a sentence, a word, a letter with regards to this already being a crime. Child pornography is a federal crime.
The Supreme Court held unanimously in New York v. Ferber that it receives no constitutional protection whatsoever. We all know that. These situations are brought up. Look, there's been violations of the IRS going after organizations based on political reasons. We know that.
Those have been documented. They've happened in previous administrations. This is trying to take it off the table because I sincerely believe too that my Democratic colleagues also know they don't want their faith-based people, their attend churches, they don't want this to be weaponized. Churches in our nation that educate kids, that provide philanthropic efforts beyond what our government has the capacity to do, are given tax-exempt status. This benefits our nation.
This is a nonpartisan issue. And so it's tough to hear these accusations that this legislation in any way is going to change something from being a felony federal crime. This legislation does nothing of that. It is designed to take this off the table so there won't be a weaponization against religious organizations in the future and they can continue to do the good things that they're trying to do for our communities. I believe it's disingenuous to make up all these claims that we're hearing.
That's not going to be changed at all from this legislation. And I yield back.
Lloyd Doggett
Religious freedom is so fundamental to this country. It's what brought people here to America over 250 years ago to seek the ability to practice their religion. It's what draws people here today to this wonderful country. I believe in religious freedom. I don't believe in religious persecution.
And to have a bill that really will encourage organizations to discriminate against people, to deny them employment because of whom they love and because they might love someone of a different race or of the same sex is fundamentally wrong. I think this bill has to be considered in the current context of the increased discussion of white Christian nationalism, which I've never viewed as very Christian, but which seeks to impose its views to the exclusion of others. I respect the author of the legislation, but I respectfully disagree with him that this is a narrow exception. To use terms to prohibit, basically to tell the Internal Revenue Service, look the other way if any practice here concerns marriage, sexuality, or gender identity is not a narrow exception. It is a wide open exception that tells the IRS not to bother with these kind of practices.
I believe that as our colleague Ms. Moore has pointed out, child marriage is not against the law in multiple states. But this bill will say the Internal Revenue Service should turn the other way if it's viewed as contrary to public practice. And I'm not aware of any federal law on child marriage. The same is true of some of the other practices that we're concerned about here. It also raises a question of, with these dangers from this overly expansive bill, what value is there in it?
Unless a group is really out to discriminate against people based on their choices as to whom they love, based on some of the other issues here that might not comport with Christian white nationalism, why have this bill? I don't see that there's been any good cause given for the bill and the dangers certainly override any minimal benefit that could occur from adopting this legislation. So I hope we can look at it further with reference to amendments, but that ultimately this bill probably can't be fixed and should be not approved by the committee today. Thank you very much.
Will Mr. Doggett yield?
I yield.
Linda Sánchez
I just want to refute a point that the author of this bill just stated. He said that there are laws against child pornography, there are laws against child marriage, against polygamy, bestiality, incest. But I want to read into the record a section of the bill which contradicts what you have just said. It says, for purposes of this section, number one, a religious belief or practice concerning marriage, sexuality, or gender identity, but here's the important part here, shall not be treated as being inconsistent with law or public policy. That means you can engage in any of the things I just said: polygamy, statutory rape, child marriage, incest, and it shall not be treated as being inconsistent with the law.
So even though we have laws against those things, if this bill passes, any religious belief or practice that engages in any of those activities is treated as not being contrary to the law, therefore not illegal. Therefore, they do not lose their tax-exempt status. What this is is taxpayer subsidies for religious organizations that are breaking the law.
I and I find that like shocking that nobody, even the author, has realized that that is in what this bill does. This I the intent of the of the bill I don't quibble with, but the way in which it is drafted is really overly broad and opens the door for all kinds of terrible practices to be considered not illegal and therefore people can have their tax-exempt status. They don't have to pay taxes to the United States even though they are breaking the law. That is here in the actual text of the bill. I think that is why you are seeing such fervent pushback from this side of the aisle.
I see my Mr. Doggett's time has expired. I would ask for five minutes of my my own time to be recognized. I'd like to continue to talk about this bill.
Speaker 89
Thank you, Mr. Chairman. Mr. Moore, I didn't realize what your purpose of proposing this legislation entailed. I I actually thought it was about something altogether different, but apparently no. That's just not possible when we debate these things. I I really I'm I'm shocked.
I went through your your piece of legislation and I didn't really I didn't really try to find something in there that would suggest some of the things you're being accused of hiding in there or trying to protect. And it comes down to a tax status, which does everything. I hope that the American people are watching this. For some reason, this body has turned into something that I don't think the founders ever expected it could possibly reach. But Mr. Moore, I've known you for quite some time.
I know you quite well. I am really I couldn't find anything that you hid in this legislation. I I I know you've had a chance to talk on this, but this is where we are. This is where we are. I think what you've put together is fine.
I this has become too bizarre. It really has. And we try to we try to find something wrong. I it's it's beyond my wildest imagination that when I ran for office back in 2010, we would actually be spending time looking at a piece of legislation that apparently has all these issues hidden in it that we just weren't able to see. So I want to thank my friends on the other side for pointing out just how nefarious this piece of legislation is.
Shocking, shocking that you would try to hide something like that, Mr. Moore. All the time I've known you, I know what you what you stand for. I know what your family stands for. I know what your religion stands for. I know everything about that.
And I know that is not who you are and that was not what you were attempting to do in this piece of legislation. Now, having said all that, I also want to take just a moment. Before the action of today started, I had a chance to talk to Mr. Barthold. And I've always been impressed with Mr. Barthold and his team. Mr. Barthold has been doing this for 38 years.
Sometime when you have an opportunity to sit down and put together your journals, it's going to be interesting to see your perception of it. But for you to give 38 years of your life, for your team to give up time that they could be doing other things. But I guarantee if you were ever looking for any other thing to do, you have a resume that could get you into almost any office anywhere in the country for your your expertise. I guess this is what our form of government allows, though. This debate, if you want to call it a debate, these conversations that we have regarding things that are important to our fellow citizens.
And no matter how far we take it, it's just the way it works.
And I'm told so many times that, you know what, Kelly, your problem is you don't understand politics. You always thought it was about policy. You didn't understand that depending on who was in office, we turned inflation into affordability. We double-digit inflation and all of a sudden, well, things aren't affordable. Yeah, no kidding.
We had runaway inflation, but we forgot about that. We talk about the fact that the Strait of Hormuz is the reason President Trump is doing this and we forget about the previous administration when we shut down the Keystone Pipeline. That didn't require any military action. But we did it and that's when the prices of gasoline were the highest they've ever been, okay? So convenient loss of memory is okay.
But the American people, I hope, and I really hope that they don't read too much into these debates that we have other than the fact that it's about politics. It has nothing to do with policy. And my friends on the other side, oh, how dare you say that, how dare you say that. Of course I say it. Well, we do all have the right to say what we think.
And I'm just telling you what I think. And I think that this is a great example of what makes the American people think, you know what, I don't like any of you people. I don't like any of you because you never get anything done except this bartering back and forth, battering each other. So Mr. Moore, I want to tell you, I emphatically am going to support what you put together because I know why you did it and I know your heart, I know your faith, I know your family, I know you. And but I guess it goes with the territory right now.
We can tear anybody apart for any reason we want and say, no, you don't understand, see, I can't be held liable for anything I say because this is a matter of politics. Mr. Moore, thank you for bringing it forward. Thank you for your stance. Thank you for your, I know who you are and everything you stand for. I thank you very much.
Chairman, thank you for bringing this forward today as much as we say it has nothing to do with anything that we really need to be concerned with. I've watched so many things, by the way. The Epstein situation actually was ignored for the previous four years. Apparently it just bubbled up to the top. Maybe because somebody thought they'd get some time on the front steps of the Capitol to talk about it.
But the facts are the facts. And in this case, the facts are on your side, Mr. Moore. Great piece of legislation. I support you heartily.
Linda Sánchez
Thanks, Mr. Sanchez. Yeah, perhaps Mr. Kelly was absent when I started my remarks, which said I impugn no ill intent by the author of this legislation. I didn't make personal attacks against Mr. Moore. I didn't accuse him of trying to hide something in the legislation like you just said. I was merely pointing out what the language of his bill allows.
And if there's any accusation that I have made today against Mr. Moore, it's that the language is overly broad and it was sloppily drafted. It is way overbroad. It says that nothing concerning marriage, sexuality, or gender identity, that a religious belief or practice concerning marriage, sexuality, or gender identity shall not be treated as being inconsistent with the law or public policy. I have, this is a policy debate. This is not politics.
I'm not bringing the prior administration into this or the Strait of Hormuz. I'm looking at the actual words that are written on a piece of paper in this bill that you all are so desperate to pass.
And I'm asking myself why, if the language is so clear, it so clearly states that it would not be treated as being inconsistent with the law, even though many of these things are illegal. If this bill were to pass, those religious beliefs, child marriage, incest, polygamy, bestiality, those would not be inconsistent with the law or with public policy, which means they would not be illegal. So they would retain their tax-exempt status, which means they don't have to pay taxes to the United States federal government, but they can engage in illegal action. That's a problem. If you guys can't see that that's overly broad and that's a problem, I'm frightened.
It's very clear in the text of the bill itself. Perhaps you haven't read the bill. Maybe you should take some time to read it and try to digest what that particular provision states, because it's, it's a big deal. That is the crux of why we are shocked that the bill was brought forward and not discussed further or, or not drafted in a more narrow scope. Again, just so that we're absolutely clear for those who have not read this provision, a religious belief or practice concerning marriage, sexuality, or gender identity shall not be treated as being inconsistent with law or public policy.
I'll let those words sink in for just a second, because it means that if you are a religion that believes in polygamy or believes in child brides, child marriage, incest, bestiality, and you have a tax-exempt status, which means you don't have to pay taxes to the federal government, if you, if this is your religious belief, that practice cannot be considered inconsistent with laws against that practice or public policy against that practice. That means we are allowing certain organizations who have practices that are against the law to maintain their tax-exempt status, to, to maintain the benefit of not having to pay taxes to the federal government. I mean, I'm, I'm genuinely shocked that this doesn't raise any kind of concern with the other side of the aisle, that there's no, okay, let's go back to the drafting board and see if we can make it more narrow to, to fit the purpose of what the bill is trying to do without allowing all of this ugliness to allow to, to go forward without, you know, while maintaining benefits of tax-exempt status. I would love to, if somebody on the other side of the aisle could say why that language doesn't trouble them. Shall not be treated as being inconsistent with law or public policy.
That says it all. I guess I have no takers on anybody diving deep on that language and, and having a counterargument as to why these illegal practices under this section, as long as they're a religious belief or practice, are not treated as if they are illegal. And my time has run out, so I will yield back.
Judy Chu
The author of this amendment has as its defense that the things that I raised as objectionable are already considered to be illegal by state laws. But let's take a few of these examples. How about child marriage? I raised shouldn't a 10-year-old child marrying an adult qualify this organization to be removed from tax-exempt status? Well, you know what?
Ms. Chu.
Judy Chu
33 states permit child marriage and there is no federal minimum. And let's talk about interracial marriage. Interracial marriage is allowed in all 50 states. And yet, if this amendment passes, then an organization's religious belief on marriage that discriminates against interracial marriage would still allow it to have its tax-exempt status. And let's talk about jailing LGBTQ people.
Actually, that's against the law. It's a federal law that they should not be jailed just based on being LGBTQ+. And yet, this amendment would say that if an organization's religious belief on sexuality or gender identity is that all LGBTQ people should be jailed, they could still maintain their tax-exempt status. Even in for bestiality, there's actually one state for which that is still legal. And yet, there, if an organization's belief on sexuality advocates for bestiality, they could still maintain their tax-exempt status.
So, rather than simply protecting religious liberty, this bill would prevent the IRS from considering some of the most egregious, backwards, and disgusting practices inconsistent with long-standing public policy when determining eligibility for valuable federal tax benefits. This is not right, and that's why we must defeat this amendment.
Jason Smith
Are there additional members that wish to strike the last word? Seen none, we will move to amendments. Are there any amendments to the amendment in the nature of a substitute? Ms. Sanchez.
Speaker 16
A point of order has been reserved. Will the gentlelady suspend while the amendment is distributed? Proceed.
Linda Sánchez
My Republican colleagues would have you believe that this bill is about religious freedom, and I believe that that's what the intent was, but it's simply not the case the way the bill is drafted. There should be no mistake about it. This bill is actually a license to discriminate on the taxpayer dime. My amendment is a simple one. It clarifies that this bill does not apply to religious practices or beliefs that discriminate against same-sex or interracial marriages, promote exploitation of minors, or discriminate based on gender identity or sexual orientation.
It is truly outrageous to me that any member on this committee, regardless of their party, would vote to advance a bill that allows our tax dollars to subsidize blatant discrimination. That is why my amendment would ensure that discriminatory organizations have no right to maintain tax-exempt status.
Not only does the underlying bill greenlight discrimination, it also greenlights some very dangerous ideals. This bill, which is only a few lines long, does not include any specific definitions of these beliefs surrounding marriage or sexuality. It is so broad that it could make room for fringe religious organizations that support child marriage to operate under a tax-exempt status. To combat that, my amendment would make sure that this bill does not apply to any religious belief that exploits or endangers children. I wish I could say that I expect this amendment to be adopted unanimously, but unfortunately, I don't think that that's going to be the case if the debate thus far has proven anything.
If this bill passes out of committee unamended, it will greenlight discrimination from organizations that are meant to protect and educate Americans. I would remind every member on this dais that they have LGBTQ constituents and every member on this dais has constituents in interracial marriages. I urge you all to consider your most vulnerable constituents back home and vote for my amendment to ensure that their rights are protected. And with that, I will yield back the balance of my time.
Jason Smith
Does any member wish to strike the last word on the amendment? Seen none, the question is on agreeing to the amendment offered by Ms. Sanchez. The clerk will call the roll.
Speaker 17
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Kelly. Mr. Kelly, no. Mr. Schweikert.
Speaker 11
Mr. Panetta. Mr. Panetta, yes. Mr. Gomez. Mr. Gomez, yes. Mr. Horsford.
Mr. Horsford, yes. Ms. Plaskett. Mr. Suozzi. Mr. Suozzi, yes. Mr. Buchanan.
Mr. Smith of Nebraska. Mr. Smith of Nebraska, no. Mr. Arrington. Mr. Fitzpatrick. Ms. Van Duyne.
Ms. Van Duyne, no. Mr. Bean. Mr. Bean, no. Mr. Moran. Mr. Schneider.
Ms. Plaskett. Chairman Smith. Chairman Smith, no.
Clerk will report the vote.
Mr. Chairman, the ayes are 15 and the nays are 22.
Jason Smith
There being 15 ayes and 22 nays, the amendment is not agreed to. Are there additional amendments? Ms. Moore.
Thank you.
Gwen Moore
Thank you, Mr. Chairman. I can see that the committee rejected a very good amendment a few seconds ago, but this one is very, very narrow. It just says this amendment would provide that this bill does not apply to religious beliefs or practices that promote child marriage. I again want to rebut Mr. Moore's notion that these are 10-year-olds getting married, children being married to older men, these are isolated incidences. They are not.
I'm not talking about R. Kelly and Aaliyah. I'm talking about real people every day. I'm talking about the founder of the Resilience Foundation in Indiana. Her name is Genevieve. Quote, "I was only 14 and fresh out of foster care when my parent decided to marry me off to a 43-year-old to avoid his prosecution."
You know, him having sex with her was illegal, so she had to marry him. "I felt powerless and without a future, just one of the many children married off each year in the US, a country that boasts democracy and justice." "Ignoring the issue of child marriage contradicts our stated values of equality." And that is why she has said that she supports my bill that I've just introduced, the Child Marriage Prevention Act of 2026. And I am just stunned that everybody won't agree with me.
As I have indicated in my further, in my, in previous dialogues, that child marriage is harmful to women. You know, it is accompanied by violence, domestic violence and brutality, giving birth at a very early age, forcing women to abdicate their ability to go to school and to be able to become financially independent. And not only is it a problem for American women, 300,000 of them just this decade, United States citizens being forced into it, it is women who are being trafficked from other countries here to be married. There's no limit in age on how young you can be. There's one account that I have here where a woman was eight years old, pinned down to the bed to get her ear pierced as a part of a ceremony before she became a bride.
This is not a joke, this is not abstract, and it is not, unfortunately, just something that happens every once in a while. I would hope that my amendment would be taken in good faith, Representative Moore. Just as you offered your bill in good faith, I'm offering this amendment in good faith. And that is because, as you know from my advocacy, I am very, very, very triggered by sexual assault. I'm very, very interested in preserving, preventing violence against women.
And there is no way that we should be, you know, putting this in statute against all of the efforts that have been made over decades to get the 17 states that we have already had to prevent child marriages. But the other 33, as Ms. Chu indicated, that don't have a minimum age for child marriage. It's not even, they're not even saying you get your parents' permission and you can marry at 16. No, 10. And so I would yield back and offer this entire body an opportunity to do the right thing by women and by children.
I yield back.
Jason Smith
Additional members wish to strike the last word on the amendment? Seen none, the question is on agreeing to the amendment offered by Ms. Moore. The clerk will call the roll.
Speaker 23
Mr. Schweikert, no. Mr. LaHood. Mr. LaHood, no. Mr. Arrington.
Mr. Carey, no. Mr. Yakym.
How is Dr. Murphy recorded?
Dr. Murphy is not recorded.
Chairman Smith, no.
Jason Smith
The clerk will report the vote. Mr. Chairman, the yeses are 16 and the nos are 22. There being 16 yeses and 22 nos, the amendment is not agreed to. Are there additional amendments? Ms. Moore is recognized for a second amendment.
A point of order has been reserved. Will the gentlelady suspend while the amendment is distributed? You can proceed, Ms. Moore.
Gwen Moore
Thank you so much Mr. Chairman. This is a really straightforward amendment that would prohibit female genital mutilation. US policy for a long time has condemned the practice of female genital mutilation or the intentional cutting or removal of the female external genitals for non-medical reasons. Unlike circumcision which is performed on men and is performed in the in the in a religious context, circumcision can promote the health and safety of boys. Female genital mutilation is unhealthy, it is harmful to women and is harmful to society as a whole.
41 states in the United States have criminalized female genital mutilation. That's a shocking number, all of them should prohibit it. It's a serious human rights violation, it's a form of child abuse and since 1996 it has been a federal crime. In 2013 Congress amended the federal law to strengthen it and again in 2021 when Congress enacted the strengthening the opposition to female genital mutilation, the Stop FGM Act that prohibits female genital mutilation of minors. It was the work of our late colleague Representative Sheila Jackson Lee.
The legislation established clear statutory definition of FGM and made it a federal crime to perform, to attempt to perform, to conspire to perform FGM on a minor, for parents, guardians or caretakers to consent to FGM being performed on a minor or to transport a minor for the purpose of performance of FGM on the minor. The law passed the House assembly unanimously. At that time the sponsors of that legislation noted that some may think of FGM as occurring only in foreign nations, but this portrayal is completely inaccurate and we must set the record straight. FGM is practiced right here in the United States. According to a 2023 report from the US Department of Justice, as many as 513,000 women and girls living in the United States may have experienced FGM or cutting in their countries of origin or may potentially undergo this practice in the future.
When I was in the state senate, I was one of the persons I offered the bill that made it illegal in Wisconsin because we had female genital mutilation occurring in our state. And over 230 million women today are estimated to be survivors of female genital mutilation. While girls are one-third less likely to be subject to female genital mutilation than they were 30 years ago, it is only because of laws that are being made now and a recognition and a recognition of the harm and the health consequences of it. It's a human rights abuse that harms all women. When I was in the Gambia, and who was I in the Gambia with, members of this committee.
When I was in the Gambia, as you recall, we traveled overseas on a bipartisan CODEL to reaffirm to the elected officials in the Gambia their need to keep a ban on female genital mutilation in place.
We should not be hypocrites today because this bill will clearly, clearly condone female genital mutilation. And so, you know, we need to sweep around our own front door as we criticize other nations for child abuse, because it is happening in the United States and we should not pass any law to support it. And I will yield back the balance of my time. Thank you so very much. I also want to say to the, before I yield back, to the author, you can stop this right now.
You can accept this amendment in good faith. It won't upend your bill totally. I know I'm in the minority, but my God, this, this is, this, we are enacting child abuse into the law and we shouldn't do it. You can stop it, Mr. Moore. I yield back.
Speaker 23
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Smith of Nebraska, no. Mr. Kelly. Mr. Kelly, no.
Mr. Schweikert. Mr. LaHood. Mr. LaHood, no. Mr. Arrington. Mr. Estes.
Mr. Estes, no. Mr. Smucker. Mr. Smucker, no. Mr. Moran.
Chairman Smith, no.
Mr. Chairman, the yeses are 16 and the nos are 22.
Jason Smith
There being 16 yeses and 22 nos, the amendment is not agreed to. Are there additional amendments? Seen none, the question is on the adoption of the amendment in the nature of a substitute. All those in favor signify by saying aye. Those opposed say no.
In the opinion of the chair, the ayes have it and the amendment in the nature of a substitute is agreed to. I will now recognize Mr. Smith for the purpose of offering a motion.
Adrian Smith
Mr. Chairman, I move that the committee favorably report H.R. 9722 as amended to the House of Representatives.
Jason Smith
The question is on the motion to favorably report H.R. 9722 as amended to the House of Representatives. The clerk will call the roll.
Speaker 11
Mr. Buchanan. Mr. Smith of Nebraska. Mr. Smith of Nebraska, yes. Mr. Kelly. Mr. Kelly, yes.
Mr. Schweikert. Mr. Schweikert, yes. Mr. LaHood. Mr. Arrington. Mr. Estes.
Mr. Estes, yes. Mr. Smucker. Mr. Smucker, yes.
Mr. Yakym?
Speaker 17
Mr. Yakym, yes. Mr. Schneider? Mr. Horsford? Ms. Plaskett? Chairman Smith?
Chairman Smith, yes.
Jason Smith
The clerk will report the vote. There being 23 ayes and 16 nays, the motion is agreed to, and H.R. 9722, as amended, is ordered favorably reported to the House. Without objection, I ask that staff be authorized to make technical and conforming changes to H.R. 9722 and that members have two additional days to file with the committee clerk supplemental, additional, dissenting, or minority views. There being no further business before the committee, the committee stands adjourned.