S. 3653 - Protecting Federal Funds from Human Trafficking and Smuggling Act of 2022

[Discussion Draft]

117TH CONGRESS
2D SESSION

S. 3653

To direct the Director of the Office of Management and Budget
to require the disclosure of violations of Federal law with respect
to human trafficking or alien smuggling, and for other purposes.

IN THE SENATE OF THE UNITED STATES

FEBRUARY 15, 2022

Mr. KENNEDY introduced the following bill;
which was read twice and referred to the Committee on _____

A BILL

To direct the Director of the Office of Management and Budget to require the disclosure of violations of Federal law with respect to human trafficking or alien smuggling, and for other purposes.

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

SECTION 1. SHORT TITLE.

This Act may be cited as the "Protecting Federal Funds from Human Trafficking and Smuggling Act of 2022".

SEC. 2. MANDATORY DISCLOSURES OF HUMAN TRAFFICKING AND ALIEN SMUGGLING.

(a) LIMITATION ON AWARD OF FEDERAL FUNDS. —

(1) FUTURE RECIPIENTS. — Beginning not later than 120 days after the date of the enactment of this Act, no Federal funds may be awarded to a nonprofit entity unless such entity submits to the Director of the Office of Management and Budget a certification that the entity —

(A) is in compliance with Federal law with respect to human trafficking, alien smuggling, fraud, bribery, and gratuity; and

(B) has not been convicted of an offense under section 274 of the Immigration and Nationality Act (8 U.S.C. 1324).

(2) CURRENT AND PRIOR RECIPIENTS. —

(A) IN GENERAL. — Not later than 60 days after the date of the enactment of this Act, each nonprofit entity that is in receipt of awarded Federal funds as of the date of the enactment of this Act, or was awarded Federal funds before January 1, 2021, and remains engaged in the activities for which such Federal funds were awarded, shall submit to the Director of the Office of Management and Budget a certification that the entity —

(i) is in compliance with Federal law with respect to human trafficking, alien smuggling, fraud, bribery, and gratuity; and

(ii) has not been convicted of an offense under section 274 of the Immigration and Nationality Act (8 U.S.C. 1324).

(B) EFFECT OF NONCOMPLIANCE. — If an entity referred to in subparagraph (A) does not submit the certification required under such subparagraph before the date referred to in such subparagraph, or the Director of the Office of Management and Budget determines that the entity has violated section 274(a)(1)(A) of the Immigration and Nationality Act (8 U.S.C. 1324(a)(1)(A)), the entity shall reimburse the Federal Government for any Federal funds the entity received for the fiscal year in which such noncompliance occurred.

(b) DENIAL OF TAX EXEMPTION. — Section 503 of the Internal Revenue Code of 1986 is amended by adding at the end the following:

"(g) DENIAL OF EXEMPTION FOR NOT MEETING CERTAIN CERTIFICATION REQUIREMENT. —

"(1) IN GENERAL. — An organization described in section 501(c) shall not be exempt from taxation under section 501(a) if —

"(A) such organization does not submit the certification required under section 2(a) of the Protecting Federal Funds from Human Trafficking and Smuggling Act of 2022; or

"(B) the Director of the Office of Management and Budget determines that such organization has violated section 274 of the Immigration and Nationality Act (8 U.S.C. 1324.

"(2) RE-APPLICATION FOR EXEMPTION. — Beginning on the date that is one year after the date on which an organization described in section 501(c) is determined not to be exempt under paragraph (1), such organization may reapply to be exempt from taxation under section 501(a).".

(c) REPORTING REQUIREMENT. — Not later than 120 days after the date of the enactment of this Act, the Secretary of Homeland Security shall —

(1) develop a written strategy and best practices guide for nonprofit entities to ensure the entities comply with Federal law, including how to detect, deter, and report human trafficking and alien smuggling;

(2) publish, on an internet website of the Department of Homeland Security, information regarding violations of any nonprofit entity that pertains to compliance with Federal and State laws involving human trafficking and alien smuggling; and

(3) develop a written strategy to improve cooperation with nonprofit entities and Federal and State law enforcement agencies with respect to improving cooperation on deterring, detecting, reporting, and removing aliens.

(d) REPORT BY COMPTROLLER GENERAL. — Not later than 180 days after the date of the enactment of this Act, and annually thereafter, the Comptroller General of the United States shall submit a report to Congress that identifies each failure by a nonprofit entity to comply with the certification requirement under subsection (a) during the reporting period.

(e) APPLICABILITY. — The requirement under subsection (a) shall apply to any nonprofit entity awarded Federal funding, including any nonprofit entity that has an agreement, contract, award, or relationship with the Federal Government on the date of the enactment of this Act.