Panel Backs Bill To Rein In '527' Advocacy Groups

By Thomas B. Edsall
Washington Post Staff Writer
Thursday, April 28, 2005

The Senate rules committee approved legislation yesterday to prohibit "527" organizations such as Swift Vets and POWs for Truth and the Media Fund from using unlimited contributions to run political commercials.

The measure immediately provoked a firestorm of criticism from left and right advocacy groups -- and from top Senate Democrats, who called the bill a Republican "Trojan horse" designed to benefit the GOP while weakening financial support of Democrats.

The legislation, which may go to the Senate floor next month, would prohibit 527 advocacy organizations buying television time in federal elections from accepting unlimited contributions. If the bill becomes law, for example, financier George Soros, who gave more than $6 million to the Media Fund in 2003-2004, and developer Bob J. Perry, who gave the Swift boat group $4.5 million, would be allowed to give no more than $32,500 to such groups.

Other major provisions include:

· A ban on federal campaign finance regulation of political activities on the Internet, including the political Web logs that have become increasingly significant players in elections.

· An increase from $5,000 to $7,500 in maximum contributions to political action committees. The amount that PACS could give to candidates would rise from $5,000 to $7,500, and the amount they could give to political parties would jump from $15,000 to $25,000.

· Allowing trade association and corporate PACs to solicit employees, including non-supervisory workers.

Fred Wertheimer, president of Democracy 21 and a leading proponent of setting restrictions on 527 groups, which are named after a section of the tax code, said the amendments adopted yesterday "seriously undermine the effort to close the soft-money loophole for 527 groups which resulted in hundreds of millions of dollars in unlimited soft money being spent to influence the 2004 federal elections."

During committee proceedings, one of the lead sponsors, Sen. Charles E. Schumer (D-N.Y.), withdrew his support for the bill, warning Democratic colleagues that "this bill is serving as an anti-campaign-finance Trojan horse" that GOP leaders will use to gain partisan advantage.

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