Protecting Federal Funds from Human Trafficking and Smuggling Act of 2025

Bill Number

H.R. 1168

Origin Chamber

House

Congress

119th Congress, Session 1

Policy Area

Crime and Law Enforcement

Status

Introduced

Latest Action

2025-02-10: Referred to the Committee on the Judiciary, and in addition to the Committees on Oversight and Government Reform, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.

Last Updated

2025-04-24T16:20:48Z

AI-Generated Summary

Purpose

The Protecting Federal Funds from Human Trafficking and Smuggling Act of 2025 aims to prevent non-profit organizations involved in human trafficking, alien smuggling, or related violations from receiving federal funds or tax exemptions. It requires certifications of compliance with federal laws and imposes penalties for non-compliance, while directing government agencies to enhance oversight and reporting on these issues.

Key Provisions

• Certification Requirement for Federal Funds: Non-profit entities must certify to the Director of the Office of Management and Budget (OMB) that they comply with federal laws on human trafficking, alien smuggling (defined under 8 U.S.C. 1324 as bringing in or harboring undocumented immigrants for profit or gain), fraud, bribery, or gratuities, and have no convictions under the alien smuggling statute.
• New recipients: Certification required starting 120 days after enactment before any funds are awarded.
• Existing or prior recipients (including those funded before January 1, 2025): Certification due within 60 days; non-submission or violation leads to repayment of all awarded funds.
• Denial of Tax-Exempt Status: Amends the Internal Revenue Code (Section 503) to revoke tax-exempt status under Section 501(c) for non-profits that fail to certify or are found to have violated the alien smuggling law. Affected organizations can reapply for exemption after one year.
• Department of Homeland Security (DHS) Responsibilities: Within 120 days of enactment, the DHS Secretary must:
• Create a strategy and guide for non-profits on complying with laws, including detecting, deterring, and reporting human trafficking and alien smuggling.
• Publish online details of any non-profit violations related to these issues under state or federal law.
• Develop a plan to boost cooperation between non-profits, state, and federal law enforcement on preventing, detecting, reporting, and removing undocumented immigrants.
• Comptroller General Reports: The Government Accountability Office (GAO) must report to Congress within 180 days of enactment, and annually thereafter, on non-profit failures to certify under the act.
• Applicability: Covers all non-profits receiving federal funding, including those with existing contracts, agreements, or relationships with the federal government as of enactment.
• Amendment to Verification Law: Strikes subsection (d) of Section 432 of the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (8 U.S.C. 1642), which previously outlined specific verification processes for non-profit charitable organizations regarding eligibility for federal benefits (removing this simplifies or alters those requirements).

Significant Changes to Existing Law

• Introduces a new mandatory certification process tied directly to federal funding eligibility, which did not previously exist in this form for these specific violations.
• Modifies the Internal Revenue Code to link tax-exempt status to compliance with immigration-related laws, expanding grounds for revocation beyond current fraud or illegal activities.
• Adds reporting and strategy mandates for DHS, creating new oversight tools not previously required.
• Removes a subsection from an existing immigration benefits law (8 U.S.C. 1642(d)), potentially streamlining verification for non-profits but eliminating prior detailed procedures for checking eligibility in charitable contexts.
• Applies retroactively to pre-2025 funding recipients, allowing repayment demands for past awards.

Potential Impacts

• On Government Agencies: Increases administrative burdens for OMB (certification reviews), IRS (tax status revocations), DHS (developing guides and publishing violations), and GAO (annual reporting), potentially requiring new resources for enforcement and coordination.
• On Citizens and Non-Profits: Non-profits, especially those providing immigrant services, humanitarian aid, or border-related support, may face funding cuts or tax penalties, disrupting operations and services to vulnerable populations like immigrants or trafficking victims. Citizens relying on these non-profits for aid could experience reduced access.
• On International Relations: Could strain relations with countries affected by U.S. immigration policies by increasing scrutiny on non-profits involved in cross-border aid, potentially deterring international NGOs from U.S. partnerships; however, it may enhance U.S. efforts to combat global human trafficking.

Main Stakeholders Affected

• Non-Profit Organizations: Primary targets, particularly 501(c) entities receiving federal grants or involved in immigration, refugee, or anti-trafficking work; risk losing funds, tax benefits, and facing repayment demands.
• Federal Agencies: OMB, DHS, IRS, and GAO, which gain new duties in certification, reporting, and enforcement.
• Law Enforcement and Congress: State and federal agencies benefit from improved cooperation strategies; Congress receives ongoing violation reports to inform oversight.
• Immigrants and Victims: Undocumented individuals or trafficking survivors may see changes in service availability from affected non-profits.
• Taxpayers: Indirectly impacted through potential repayment of misused funds and shifts in federal spending priorities.

Notable Legal, Constitutional, or Political Implications

• Legal Implications: Strengthens accountability for non-profits under immigration laws (e.g., 8 U.S.C. 1324), but the broad certification language could lead to challenges over what constitutes "compliance" or "violation," potentially resulting in litigation on due process or arbitrary enforcement.
• Constitutional Implications: Revoking tax-exempt status based on immigration violations might raise free speech or association concerns under the First Amendment if it chills non-profits' advocacy on immigration issues; the retroactive repayment provision could face ex post facto challenges, though it applies to civil penalties rather than criminal ones.
• Political Implications: Aligns with efforts to tighten immigration enforcement and reduce federal support for entities perceived as enabling smuggling or trafficking, likely appealing to restrictionist policymakers but drawing criticism from humanitarian groups for potentially harming legitimate aid organizations. The bill's referral to multiple committees (Judiciary, Oversight, Ways and Means) signals broad jurisdictional interest in fiscal and immigration policy intersections.

This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.

Sponsor

Rep. Gooden, Lance [R-TX-5]

Cosponsors (10)

Rep. Biggs, Andy [R-AZ-5], Rep. Gill, Brandon [R-TX-26], Rep. Mace, Nancy [R-SC-1], Rep. Weber, Randy K. Sr. [R-TX-14], Rep. Gosar, Paul A. [R-AZ-9], Rep. Ellzey, Jake [R-TX-6], Rep. Ogles, Andrew [R-TN-5], Rep. Rose, John W. [R-TN-6], Rep. Haridopolos, Mike [R-FL-8], Rep. Tiffany, Thomas P. [R-WI-7]

Recent Actions

• 2025-02-10: Referred to the Committee on the Judiciary, and in addition to the Committees on Oversight and Government Reform, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-02-10: Referred to the Committee on the Judiciary, and in addition to the Committees on Oversight and Government Reform, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-02-10: Referred to the Committee on the Judiciary, and in addition to the Committees on Oversight and Government Reform, and Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.
• 2025-02-10: Introduced in House
• 2025-02-10: Introduced in House

Bill Versions

• Protecting Federal Funds from Human Trafficking and Smuggling Act of 2025 — issued 2025-02-10 — PDF (5 pages)