- The Washington Times - Wednesday, September 1, 2004

The Bush campaign yesterday filed a lawsuit in federal court to force the Federal Election Commission to take action against the so-called 527 groups that are collecting and spending unlimited amounts of money to influence this year’s presidential election.

“To prevent these 527s from continuing to violate federal election law, we have asked the federal court to step in and order the FEC to act,” campaign attorney Tom Josefiak said.

Tax-exempt 527 groups, named for the section of the IRS code that regulates them, have no spending and fund-raising caps and don’t have to disclose their donors to the FEC.

Congress overhauled federal election laws in 2002 when it passed the Bipartisan Campaign Finance Reform Act (BCRA), also known as the McCain-Feingold bill after the two senators who sponsored the legislation.

The BCRA prevents political parties from using unlimited and undisclosed contributions, also called soft money. Since then a crop of organizations formed under the 527 code have emerged, taking millions from unions, corporations and private donors to influence the 2004 elections.

Mr. Josefiak said that despite a recent ruling to rein in the activities of the groups, the FEC has given no public indication that it will act on the complaints.

“The partial regulations they put out do not adequately state the threshold for when an organization’s major purpose is to influence federal elections,” he added.

Under the new regulations, once a 527 group solicits $1,000, saying that the money will be used to elect or defeat a federal candidate, it will be considered a “political committee” and must register with the FEC and face fund-raising limitations.

The new rules also say if such a group runs an ad that mentions a federal candidate, it must use at least 50 percent hard money, or funds that must be disclosed and are limited for individuals and banned for corporations and unions.

However, the rules won’t take effect until the 2006 election cycle.

Republican FEC Commissioner Michael E. Toner said the agency took a small but positive step in the August rulings.

“The most important issue in campaign finance today is determining under what circumstances should the 527s be considered political committees,” said Mr. Toner, who couldn’t comment on yesterday’s lawsuit.

Meanwhile, President Bush said last week he would join the bipartisan coalition of congressmen — Republicans Rep. Christopher Shays of Connecticut and Sen. John McCain of Arizona and Democrats Rep. Martin T. Meehan of Massachusetts and Sen. Russell D. Feingold of Wisconsin — in their legal battle to stop the activities of the 527s.

Sen. Trent Lott, Mississippi Republican, said Congress will have little time to deal with the FEC and 527s once it returns from summer recess next week, and will wait until the court rulings before taking action early next year.

“I do think we need to look at these 527s. It is partial to our role in passing BCRA. It is happening just as I thought it would, with the soft money oozing out to somewhere else, and I have been concerned that the FEC has not stepped up to adequately regulate these groups,” said Mr. Lott, chairman of the Senate Rules and Administration Committee, which has oversight of federal election law.

He said the ultimate answer is “full disclosure, no limits but full disclosure from the 527s, so we know who and where the money is coming from.”

Ohio Republican Rep. Bob Ney, who like Mr. Lott opposed the campaign-finance legislation, called it the “worst piece of legislation passed by Congress in recent history.”

“It is nothing but sheer hubris on the part of supporters of McCain-Feingold to simply blame the FEC, while shirking all responsibility for a political system now dominated by unaccountable organizations and foreign billionaires,” said Mr. Ney, who heads the Committee on House Administration.

But the bicameral coalition of lawmakers who championed the legislation has argued in its lawsuit that the FEC has misinterpreted long-standing campaign-finance laws interpreted by the Supreme Court.


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