HBA-CMT H.B. 408 77(R)BILL ANALYSIS Office of House Bill AnalysisH.B. 408 By: Shields Elections 3/26/2001 Committee Report (Amended) BACKGROUND AND PURPOSE Current Texas law does not specifically provide criminal penalties if a person misrepresents a tax-exempt organization in a campaign communication. House Bill 408 makes the unauthorized use of a tax-exempt organization's name in an attempt to affect the outcome of an election a criminal offense and provides a civil remedy to a person injured by an unauthorized use. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that this bill does not expressly delegate any additional rulemaking authority to a state officer, department, agency, or institution. ANALYSIS House Bill 408 amends the Election Code relating to political activity of a tax-exempt organization. The bill provides that a person commits an offense if, with intent to injure a candidate or influence the result of an election, and without the written permission of the organization or an officer, member, or employee of the organization, as appropriate, the person knowingly represents in a campaign communication that: _the communication is from a tax-exempt organization; _a tax-exempt organization supports or opposes a candidate or political party; _the communication is from a former or current officer, member, or employee of a taxexempt organization; or _a former or current officer, member, or employee supports or opposes a candidate or political party. A person also commits an offense if the person knowingly makes a misrepresentation or fails to disclose facts relating to an activity of a tax-exempt organization or a current or former officer, member, or employee, and the misrepresentation or failure to disclose endangers the tax-exempt status of the organization under the Internal Revenue Code or regulations adopted by the Internal Revenue Service, the Texas Tax Code, or rules adopted by the comptroller. An offense under these provisions is a Class A misdemeanor. The bill provides that a person injured by a violation of these provisions has a cause of action for libel. EFFECTIVE DATE September 1, 2001. EXPLANATION OF AMENDMENTS Committee Amendment No. 1 sets forth the definition of a "tax exempt organization" for the purpose of the bill. The amendment removes all language that makes it an offense for a person to knowingly misrepresent the political activity of a tax-exempt organization to influence an election and instead prohibits a person from making such a representation.