The Influence Industry

Mixed reaction to new FEC rules on candidates, interest groups working together

By Dan Eggen
Washington Post Staff Writer
Thursday, September 2, 2010; 12:27 AM

After years of wrangling, the Federal Election Commission has issued new rules aimed at clearing up the question: When is it illegal for an interest group to coordinate with a political candidate?

But it's not clear if anyone likes the FEC's answer.

By a vote of 5 to 1, the commission decided last week that any ads or other messages that contain the "functional equivalent of express advocacy" for or against a congressional candidate should be considered subject to FEC campaign finance restrictions.

Some campaign finance reformers, however, say the rules don't go far enough and leave loopholes allowing broad coordination between candidates and outside groups that support them. The rules also appear to do little to clarify what kinds of cases might run afoul of the limits, almost ensuring further litigation.

The issue is important because deciding whether an interest group is acting in coordination with a party or a candidate is crucial in determining whether it must abide by contribution limits and other oversight from the FEC.

The issue is even more relevant in the wake of January's Supreme Court ruling in Citizens United v. FEC, which found that corporations can spend unlimited amounts of money in an election - as long as they are not coordinating with a candidate.

Consider one high-profile example in the news this week: Joe Miller, the political novice who beat Sen. Lisa Murkowski in the Alaska GOP primary, benefited from about $600,000 in independent expenditures by the California-based Tea Party Express. To spend that much, however, the group could not coordinate directly with Miller's campaign.

The FEC's new rules do not take effect until December, so they will have no immediate impact on the 2010 election cycle. Outside political groups are expected to play a central role in the November midterms and are already spending millions each week.

The debate over coordination stems from the 2002 McCain-Feingold campaign finance law, which repealed the FEC's rules at the time and ordered the commission to write new ones.

The agency's attempts to define coordination have repeatedly been overturned by the courts; the rules issued last week were its latest attempt to get the regulations right.

The final vote amounted to a compromise after the six-member commission deadlocked along partisan lines, as it has frequently in recent years. One Democrat, Steven T. Walther, issued a separate opinion in dissent.

Brett Kappel, a campaign finance lawyer at Arent Fox, notes that coordination cases are notoriously difficult to decide and that the FEC has prosecuted few of them over the years. He also said many candidates of both parties allege unlawful coordination as a way to harass their opponents and grab a few headlines before an election.

"The rules have been in flux ever since McCain-Feingold," Kappel said. "It's a really hard area to try and draw lines. I think they've made a good-faith effort to come up with a workable standard."

But some advocates of tougher regulation of campaign finance spending say the FEC is giving far too much leeway to independent groups.

Fred Wertheimer of Democracy 21, a longtime campaign reform activist, said the new rules contain a "huge loophole" that effectively allows candidates to fully coordinate with outside groups in the period between a primary and a general election.

What's more, Wertheimer argues, the FEC's definitions are so broad that almost any level of planning and communication between candidates and outside groups is acceptable as long as they don't talk about a specific advertisement.

"They can do what any normal human being considers coordination, and it's not treated as coordination," Wertheimer said in an interview. "As a practical matter, it means we don't have coordination rules."

Wertheimer said his group is weighing whether to challenge the rules in court, based in part on whether Congress decides to wade into the issue.

But Jeff Patch of the Center for Competitive Politics, which opposes most forms of campaign finance regulation, said Wertheimer and other critics are grossly exaggerating the potential impact of the rules.

Patch wrote on his group's Web site that the FEC's new regulations put in place a more restrictive standard than it had previously required.

"The new coordination regulations are not perfect," Patch wrote, but "reflect a compromise by the FEC to comply with court rulings. Pro-regulation groups will never be happy with the FEC until the agency endorses every aspect of its agenda."

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