- The Washington Times - Friday, November 30, 2001

The Federal Election Commission yesterday turned down the Democratic Party's request to change fund-raising rules in the wake of September 11, which party officials said hurt fund raising and sapped their bank accounts.

Democratic National Committee spokeswoman Maria Cardona said the committee canceled several fund-raisers after the terrorist attacks, losing out on an expected $1.65 million.

The committee petitioned the FEC to grant an extension in order to have more time to raise funds and pay some expenses.

But by a 3-3 vote with the three Democrats in favor of the change and the three Republicans opposed the FEC rejected the request.

The DNC's request involved a convoluted money transfer between "hard money" and "soft money" campaign accounts. Raising hard money is restricted by federal law, but it can be spent on most election activities. Raising soft money is unregulated, but the law restricts expenditure items.

Some basic operational expenses such as salaries and office costs can be paid using hard money, then a portion of those costs can be reimbursed by soft money within 60 days of the expenses. The DNC wanted to extend the period to 120 days to give it more time to raise the money.

"This is simply a modest, administrative request for a one-time extension of this time period," said Ms. Cardona. "It was not an effort to ask for any waiving of the rules to raise soft money or any waiving of the rules to spend soft money."

But a wide range of groups, including campaign finance reform advocates Common Cause and the campaign watchdog Center for Responsive Politics, said the DNC should stick to existing rules.

These groups feared the precedent that would be established if the FEC waived the rules for any political party committee even though the DNC was the only organization to ask for the waiver.

The DNC's request comes at the same time many lawmakers Democrats in particular, but joined by some Republicans are calling for elimination of soft money in federal politics.

Rep. Christopher Shays, Connecticut Republican and one of the key sponsors of campaign finance reform legislation in the House, said the FEC was correct to reject the DNC's request.

As of Aug. 31 the latest numbers the DNC provided the FEC the party was about $1 million in debt. Since then, the party has borrowed $1.7 million to spend in the 2001 New Jersey and Virginia gubernatorial elections.

That spending, coupled with ads run before September 11 that criticized President Bush on issues such as arsenic in drinking water, were what put Democrats in the red, some Republican strategists said.

But Ms. Cardona said the money was well spent contesting races on every level and across the country. In addition to Democrats' retaking the governorships in New Jersey and Virginia, they claimed success in 31 of 32 mayoral races they targeted throughout the country.

"We might be in debt, but we have a lot of election successes to show for it," she said.

Even though the FEC's decision means the party will have to redouble its efforts on raising campaign funds, she said, the prospects for the Democrats are bright because of electoral victories on Nov. 6 and an improved fund-raising base.

Meanwhile, a spokesman for the Republican National Committee said its last report showed that the party had $26 million in hard money on hand.

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