What This Bill Does
This bill restricts government officials from requiring payments to organizations outside the U.S. government as part of settlement agreements (agreements that resolve legal disputes). The only exceptions are payments that directly fix actual harm caused by the party paying or payments for services related to the case.
Who It Affects
Federal government officials and agents who negotiate settlement agreements on behalf of the United States.
Key Provisions
• Government officials cannot enter into or enforce settlement agreements that direct money to people or organizations outside the U.S. government, except for restitution (compensation for harm) or payment for services, (Sec. 2(a))
• Officials who violate this rule face the same penalties as violations of federal law regarding improper government payments, (Sec. 2(b))
• Each federal agency must report annually to the Congressional Budget Office about settlement agreements that direct payments outside the U.S. government, including who received the money and how it was distributed, (Sec. 2(e)(1))
• The Inspector General (government watchdog) of each federal agency must report annually to Congress about any settlement agreements that violate this law, and make those reports publicly available, (Sec. 2(f)(1))
What Changes
The bill prohibits a practice where settlement agreements require defendants to donate money to third-party organizations instead of paying the U.S. government directly. Government agencies must now track and report these settlement agreements to Congress and make audit reports public.
Important Definitions
Settlement agreement: A settlement agreement that resolves a civil action (lawsuit) or potential civil action, (Sec. 2(d))
Effective Date
The restrictions apply only to settlement agreements entered after the date this bill becomes law, (Sec. 2(c)). The reporting requirement begins at the end of the first fiscal year after the bill is enacted, (Sec. 2(e)(1)). The reporting requirement ends seven years after the bill is enacted, (Sec. 2(e)(3)).
IIB
118TH CONGRESS
2D SESSION
H. R. 788
IN THE SENATE OF THE UNITED STATES
JANUARY 16, 2024
Received; read twice and referred to the Committee on the Judiciary
AN ACT
To limit donations made pursuant to settlement agreements
to which the United States is a party, and for other
purposes.
Be it enacted by the Senate and House of Representa-
1
tives of the United States of America in Congress assembled,
2
VerDate Sep 11 2014
00:29 Jan 17, 2024
Jkt 049200
PO 00000
Frm 00001
Fmt 6652
Sfmt 6201
E:\BILLS\H788.RFS
H788
ssavage on DSKBC07HB2PROD with BILLS
2
HR 788 RFS
SECTION 1. SHORT TITLE.
1
This Act may be cited as the ‘‘Stop Settlement Slush
2
Funds Act of 2023’’.
3
SEC. 2. LIMITATION ON DONATIONS MADE PURSUANT TO
4
SETTLEMENT AGREEMENTS TO WHICH THE
5
UNITED STATES IS A PARTY.
6
(a) LIMITATION ON REQUIRED DONATIONS.—An of-
7
ficial or agent of the Government may not enter into or
8
enforce any settlement agreement on behalf of the United
9
States directing or providing for a payment to any person
10
or entity other than the United States, other than a pay-
11
ment that provides restitution for or otherwise directly
12
remedies actual harm (including to the environment) di-
13
rectly and proximately caused by the party making the
14
payment, or constitutes payment for services rendered in
15
connection with the case.
16
(b) PENALTY.—Any official or agent of the Govern-
17
ment who violates subsection (a) shall be subject to the
18
same penalties that would apply in the case of a violation
19
of section 3302 of title 31, United States Code.
20
(c) EFFECTIVE DATE.—Subsections (a) and (b)
21
apply only in the case of a settlement agreement entered
22
on or after the date of enactment of this Act.
23
(d) DEFINITION.—The term ‘‘settlement agreement’’
24
means a settlement agreement resolving a civil action or
25
potential civil action.
26
VerDate Sep 11 2014
00:29 Jan 17, 2024
Jkt 049200
PO 00000
Frm 00002
Fmt 6652
Sfmt 6201
E:\BILLS\H788.RFS
H788
ssavage on DSKBC07HB2PROD with BILLS
3
HR 788 RFS
(e) REPORTS ON SETTLEMENT AGREEMENTS.—
1
(1) IN GENERAL.—Not later than at the end of
2
the first fiscal year that begins after the date of en-
3
actment of this Act, and annually thereafter, the
4
head of each Federal agency shall submit electroni-
5
cally to the Congressional Budget Office a report on
6
each settlement agreement entered into by that
7
agency during that fiscal year that directs or pro-
8
vides for a payment to a person or entity other than
9
the United States that is providing restitution for or
10
otherwise directly remedies actual harm (including
11
to the environment) directly and proximately caused
12
by the party making the payment, or that con-
13
stitutes payment for services rendered in connection
14
with the case, which shall include the parties to each
15
settlement agreement, the source of the settlement
16
funds, and where and how such funds were and will
17
be distributed.
18
(2) PROHIBITION ON ADDITIONAL FUNDING.—
19
No additional funds are authorized to be appro-
20
priated to carry out this subsection.
21
(3) SUNSET.—This subsection shall cease to be
22
effective on the date that is 7 years after the date
23
of enactment of this Act.
24
(f) ANNUAL AUDIT REQUIREMENT.—
25
VerDate Sep 11 2014
00:29 Jan 17, 2024
Jkt 049200
PO 00000
Frm 00003
Fmt 6652
Sfmt 6201
E:\BILLS\H788.RFS
H788
ssavage on DSKBC07HB2PROD with BILLS
4
HR 788 RFS
(1) IN GENERAL.—Not later than at the end of
1
the first fiscal year that begins after the date of en-
2
actment of this Act, and annually thereafter, the In-
3
spector General of each Federal agency shall submit,
4
and make available on a publicly accessible website,
5
a report on any settlement agreement entered into
6
in violation of this section by that agency to—
7
(A) the Committee on the Judiciary, the
8
Committee on the Budget, and the Committee
9
on Appropriations of the Senate; and
10
(B) the Committee on the Judiciary, the
11
Committee on the Budget, and the Committee
12
on Appropriations of the House of Representa-
13
tives.
14
(2) PROHIBITION ON ADDITIONAL FUNDING.—
15
No additional funds are authorized to be appro-
16
priated to carry out this subsection.
17
Passed the House of Representatives January 11,
2024.
Attest:
KEVIN F. MCCUMBER,
Clerk.
VerDate Sep 11 2014
00:29 Jan 17, 2024
Jkt 049200
PO 00000
Frm 00004
Fmt 6652
Sfmt 6201
E:\BILLS\H788.RFS
H788
ssavage on DSKBC07HB2PROD with BILLS