FEC: Public Financing Option Still Open for Obama

By Matthew Mosk
Washington Post Staff Writer
Thursday, March 1, 2007; 1:42 PM

Federal regulators ruled this morning that Sen. Barack Obama (D-Ill.) will be permitted to collect money for a potential general election presidential campaign without foreclosing the possibility that he will still accept federal funds for that phase of the campaign.

The ruling preserves the possibility, however slight, that presidential candidates who reach the general election will broker a deal to remain part of the public funding program created in the aftermath of the Watergate scandals.

FEC Chairman Robert Lenhard said the commissioners reached their unanimous decision after recognizing that without this ruling, public financing would almost certainly be abandoned.

"The reality is, the public financing system may no longer be viable," he said.

Obama argued that he had little choice but to start raising money for the general election, because at least two of his opponents for the Democratic nomination, New York Sen. Hillary Rodham Clinton and former North Carolina senator John Edwards, had already rejected the public financing system that has governed presidential elections for better than three decades.

The FEC ruling means Obama could reverse course if he wins the Democratic nomination, presuming he can persuade his Republican opponent to also participate in the public financing system. That system gives candidates a prescribed amount of federal dollars -- in 2008 it would be about $80 million -- rather than force them to continue devoting time and energy to raising it themselves.

Earlier this year, Clinton became the first to signal that she believed she could raise far more money outside the system and so would forgo the public funds.

Dan Pfeiffer, a spokesman for Obama, said last month that the senator's appeal to the regulators was intended to "preserve the public financing option for the parties' nominees."

Until now, candidates believed that once they started to raise a separate pool of money for the general election, they were committing to running without federal matching funds.

The FEC agreed, however, with Obama's contention that rules prohibiting him from "accepting" donations for a general election run, would not prohibit him from "receiving" those contributions, so long as he held them in a separate account, and if he were to decide to take public funds, simply return the money.

Commissioner Ellen Weintraub said she believed "it would be wrong for the agency to stand on a wooden interpretation [of those words] while the public financing system crashes and burns."

The leading Republican candidates -- Sen. John McCain (Ariz.), former Massachusetts governor Mitt Romney and former New York mayor Rudolph W. Giuliani -- have not said whether they will take public funds. But it is unlikely they would agree to limit their spending if the Democratic nominee is unwilling to do so.

© 2007 The Washington Post Company