Bill Archer: “this resolution is necessary to return to the Senate the bill S. 1311. S. 1311 contravenes the constitutional…”

“this resolution is necessary to return to the Senate the bill S. 1311. S. 1311 contravenes the constitutional requirement that revenue measures shall originate in the House of Representatives. It would override current tax law and direct a particular tax treatment for a certain newly established foundation, and therefore contravenes this constitutional requirement. Section 2 of S. 1311 would establish the National Physical Fitness and Sports Foundation. Subsection (a) provides that the foundation shall be a charitable and not-for-profit corporation and shall not be an agency or establishment of the United States. In particular, it dictates that the foundation shall be established as an organization described in section 501(c)(3) of the Internal Revenue Code and that it shall be presumed for tax purposes to be a 501(c)(3) organization until the Secretary of the Treasury determines that the foundation fails to meet the requirements of section 501(c)(3). The final sentence of the subsection explicitly waives the requirements of subsection (a) of section 508 of the Internal Revenue Code, which generally requires new organizations to notify the Secretary that they are applying for recognition of section 501(c)(3) status. This provision explicitly overrides the Federal income tax rules governing recognition of tax-exempt status.”