A Congressional Budget Office analysis said that enacting the bill “would likely reduce the number of civil settlements reached in the future and result in more litigation by federal agencies.” Image: Alex Staroseltsev/Shutterstock.com
By: FEDweek StaffThe House has passed HR-788, to prohibit federal agencies from entering or enforcing civil settlement agreements that require the other party to the settlement, such as a corporation, to make a donation to a third party.
Republican sponsors said that such payments amount to “slush funds” for political purposes. “Under the Biden Administration, settlement agreements between the federal government and individuals or corporations who break the law can include community service or donating to third party organizations as an alternative to serving time or paying fines to the government. This allows the executive branch to funnel funds to partisan non-profit organizations, instead of only sending money to directly injured parties or to the Treasury for public benefit,” they said.
In a statement, the White House said the bill “seeks to address a problem that does not exist – the federal government does not create or use ‘slush funds.’”
“When the federal government settles a case with those who violate the law, it seeks to hold bad actors accountable, to appropriately remedy the harms they have caused, and to prevent the recurrence of those harms. H.R. 788 would have adverse effects on the federal government’s ability to enforce key laws protecting the public, including criminal, bankruptcy, environmental, and civil rights laws such as the Fair Housing Act and the Servicemembers’ Civil Relief Act,” it said.
A Congressional Budget Office analysis said that enacting the bill “would likely reduce the number of civil settlements reached in the future and result in more litigation by federal agencies.”
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