Will Rep. Jimmy Panetta stand strong in the first test of fortitude against an incoming Trump administration?

Sara Rubin here, thinking about some what-ifs. Given the extreme promises President-elect Donald Trump has made, it’s easy to take these into some pretty extreme scenarios. It’s also easy to take them into some less-extreme scenarios, especially if Congress grants power to administrators to do so. 

That’s the crux of the growing opposition to HR 9495, known as the Stop Terror-Financing and Tax Penalties on American Hostages Act. The bill would allow the U.S. Treasury Secretary to revoke the tax-exempt status of an organization believed to be materially supporting a designated terrorist group. The nonprofit would receive a 90-day notice, with the opportunity to make its case and retract any real or perceived support, and could later appeal to the IRS.

Worth noting is that it is already illegal to provide material support to a terrorist organization—so why bother with the legislation? And as Kia Hamadanchy, senior policy counsel for the ACLU, says, “This gives the Treasury the ability to weaponize the tax code.” 

Hamadanchy has been watching the bill with concern for months, as it returns to the U.S. House of Representatives as early as tomorrow for another vote. It failed to reach a two-thirds threshold to pass last time, but in a new procedure, requires just 50 percent to pass. 

And even as it’s been losing support from Democrats, Rep. Jimmy Panetta, D-Carmel Valley, stands firmly behind it. 

On Nov. 30, 2023, it sailed through the Ways and Means Committee with unanimous Democratic support, including from Panetta. It went to the House floor in April where it passed 382-11, with 179 Democrats voting yes. When it came back to the House on Nov. 12, the temperature had changed; the vote was 256-145, with just 52 Democrats voting yes. Only three Democrats from the Ways and Means Committee voted yes, three cast no vote and 11 voted no. 

Panetta seems to think this is a political calculation, that Democrats are caving into fears of what a Trump administration might do to abuse the legislation. 

“The legislation with those provisions was then voted for by an overwhelming number of House Democrats,” he says. “Now, after the election, many have changed their tune due to the politics and results of the election. I realize that politics can play into the perception of legislation. However, I try my best to operate based on the merits of the policy, rather than the politics of fear.”

This is not just the politics of fear—this is the first opportunity Congress has to stand up to a very real threat posed by Trump 2.0, instead of making it easier to undermine nonprofits.

You can read more about the bill in the Local Spin column of the Nov. 21 issue of the Weekly, out tomorrow. And if you’d like to share your view with Panetta, you can contact him directly. His district office phone number is (831) 424-2229, Washington phone number is (202) 225-2861, or you can fill out a contact form online.