Ms. Oakar, Mr. Florio, Mrs. Holt, and Messrs. Ford of Michigan, Cohen, Hansen, and Symms changed their vote from "yea" to "nay." Messrs. Fountain, Zeferetti, Buchanan, and Pease changed their vote from "nay" to "yea."

So (two-thirds having voted in favor thereof) the rules were suspended and the resolution was agreed to.

The result of the vote was announced as above recorded.
A motion to reconsider was laid on the table.

HOUSE DEBATE-OCTOBER 14, 1978

DIRECTING CLERK OF HOUSE TO MAKE CORRECTIONS IN ENROLLMENT OF H.R. 8533

Mr. BRODHEAD. Mr. Speaker, I ask unanimous consent for the immediate consideration of the concurrent resolution (H. Con. Res. 754) directing the Clerk of the House of Representatives to make corrections in the enrollment of the bill, H.R. 8533.

The Clerk read the concurrent resolution, as follows:

H. CON. RES. 754

Resolved by the House of Representatives (the Senate concurring), That in the enrollment of the bill (H.R. 8533), to amend the Internal Revenue Code of 1954 to provide that income from the conducting of certain bingo games by certain tax-exempt organizations will not be subject to tax, the Clerk of the House of Representatives shall make the following corrections:

(1) At the end of the bill, insert the following new title:

TITLE III-PROCEEDS FROM BINGO GAMES

SEC. 301. (a) Section 513 of the Internal Revenue Code of 1954 (defining unrelated trade or business) is amended by adding at the end thereof the following new subsection:

"(f) CERTAIN BINGO GAMES.

"(1) IN GENERAL.-The term 'unrelated trade or business' does not include any trade or business which consists of conducting bingo games.

"(2) BINGO GAME DEFINED.-For purposes of paragraph (1), the term 'bingo game' means any game of bingo—

"(A) of a type in which usually—

"(i) the wagers are placed,

"(ii) the winners are determined, and

"(iii) the distribution of prizes or other property is made,

in the presence of all persons placing wagers in such game.

"(B) the conducting of which is not an activity ordinarily carried out on a commercial basis, and

"(C) the conducting of which does not violate any State or local law."

(b) The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 1969.

SEC. 302. (a) Paragraph (3) of section 527 (c) of the Internal Revenue Code of 1954 (defining exempt function income) is amended by striking out "or" at the end of subparagraph (B), by adding "or" at the end of subparagraph (C), and by inserting after subparagraph (C) the following new subparagraph:

"(D) proceeds from the conducting of any bingo game (as defined in section 513 (f) (2)).".

(b) (1) The amendment made by subsection (a) shall apply to taxable years beginning after December 31, 1974, except that not withstanding any other provision of law to the contrary, no amounts held at the date of enactment of this bill by an organization described in section 527 (e) (1) of the Internal Revenue Code of 1954 in escrow, in separate accounts for the payment of Federal taxes, or in any other fund which are proceeds described in section 527 (c) (3) (D) of such Code may be used, directly or indirectly, to make a contribution or expenditure (as defined in section 301 (e) and (f) of the Federal Election Campaign Act of 1971; 2 U.S.C. 431 (f)) in connection with any election held before January 1, 1979.

(2) Such amounts as described in (1) above shall not be considered as security or collateral for any loan by any State or National bank or any other person or organization.

(3) Amend the title so as to read as follows: "A bill to amend the Internal Revenue Code of 1954 to provide that income from the conducting of certain bingo games by certain tax-exempt organizations will not be subject to tax, and for other purposes."

Mr. BRODHEAD (during the reading). Mr. Speaker, I ask unanimous consent that further reading of the concurrent resolution be dispensed with and that it be printed in the record.

The SPEAKER pro tempore. Is there objection to the request of the gentleman from Michigan?

Mr. FRENZEL. Mr. Speaker, reserving the right to object. I will yield to the gentleman from Michigan to describe the unanimousconsent request to revise the bingo bill, which has been inadvertently lost.

Mr. BRODHEAD. Mr. Speaker, I thank the gentleman for yielding to me. This concurrent resolution relates to income from bingo games conducted by tax-exempt organizations, a bill which is not controversial and which passed this House by voice vote on September 25.

It went over to the Senate and was inadvertently, and through a clerical error, left off the bill when it was sent back over here. This is merely to put the bingo provision back into the bill. There is absolutely no controversy about the matter.

Mr. FRENZEL. Mr. Speaker, further reserving the right to object, I will yield to the gentleman from Michigan (Mr. Traxler), who is cosponsor.

Mr. TRAXLER. Mr. Speaker, the provisions in this resolution relating to the income from certain bingo games conducted by taxexempt organizations and political organizations are substantially the same as passed by the House on September 25. However, a restriction on the use of proceeds of bingo games by political organizations has been added. In general, this restriction provides that if a political organization holds, at the date of enactment, amounts which are the tax-exempt proceeds of bingo games, these amounts cannot be used directly or indirectly to make a contribution or expenditure, as defined in the Federal Election Campaign Act, in connection with any election. held before January 1, 1979.

I have no problem with the basic intent of this restriction as applied to funds which, on the date of enactment, are identifiable as tax-exempt proceeds of bingo games in the hands of the organization which conducted the games. However, I am concerned that this provision could be interpreted to affect amounts which have been distributed by the organization conducting the bingo games to a second political organization prior to the date of enactment. In such a case, even though both organizations were complying with the law in effect at the time the contributions were made, it might be possible to argue that contributions received by the recipient organization could not be expended by that organization.

Am I correct in understanding that this restriction is not intended to apply to amounts which are or may be held on the date of enactment by a political organization other than the organization which directly derived these proceeds from bingo games?

Mr. FRENZEL. That is correct. It is my understanding that this restriction does not apply if, prior to the date of enactment, the political organization which has received the proceeds of bingo games has also distributed to another organization these funds or funds which may be traceable to bingo operations.

Mr. BRODHEAD. I concur with Mr. Frenzel.

Mr. FRENZEL. Mr. Speaker, I hope the unanimous-consent request will be allowed, and I withdraw my reservation of objection.

The SPEAKER pro tempore. Is there objection to the request of the gentleman from Michigan to dispense with further reading of the concurrent resolution?

There was no objection.

The SPEAKER pro tempore. Is there objection to the initial request of the gentleman from Michigan?

There was no objection.

The concurrent resolution was agreed to.

A motion to reconsider was laid on the table.