Senators and representatives call them "clubs," "educational funds," constituents service funds," "communication funds" and "office accounts."
Critics call them "slush funds," and since 1952, when the disclosure of Richard Nixon's $18,000 fund nearly cost him the vice presidential nomination, they have remained one of the most questionable practices on the hill.
The funds are usually known as "unofficial office accounts" set up by senators and representatives ostensibly to pay for expenses that taxpayers-funded official allowances don't cover, such as additional newsletters, subscriptions to magazines and newspapers, renting cars and paying hotel bills, and so on.
What makes the funds "insidious," as Rep. David Obey (D-Wis.) describes them, is that they are financed by private contributions, without any limit on the amount that can be contributed and no requirements, in the house, at least, for disclosing the source or amount of contribution or what it is used for. A Senator is required to account for the receipt and distribution of all contributions over $50.
Obey is chairman of the Commission on Administrative Review, mandated to write a new House code of ethics, and the commission has proposed abolising the accounts, though in a controversial addendum aimed at compensating for that loss it has recommended adding $5,000 to the taxpayer-funded official allowance each member receives.
Obey says the $5,000 increase would be "cheap at the price" if it got private money out of what should be official business.
The Obey commission estimates that "a minimum of 150 members currently use these accounts and that the number may well exceed 175." The House accounts average $5,000, with some going as high as $60,000, according to Obey commission member Rep. Lee Hamilton (D-Ind). In the Senate, about dozen senators report having such accounts.
Recently there has been less justification for such accounts. Official allowances, particularly for newsletters, have been increased handsomely. House members, now get an average expense allowance of $50,000 s year, with members living the farthest from Washington getting the most because of travel and telephone expenses. Senators have similar allowances though theirs vary with the population of the state.
The abuses of unofficial office accounts were most recently illustrated by the revelation that Rep. John McFall (D-Calif.) concealed a $4,000 contribution from South Korean businessman Tongsun Park by putting it in his office account fund.
After the Park contribution was revealed, McFall made public his account. He had received several thousand dollars from eight Washington lobbyists for the air transportation industry (McFall is chairman of the Transportation Subcommittee on Appropriations), the California Wine Institute and other interests.
The account was used to make interest-free loans to himself and his staff, for which the fund was later reimbursed. He also used the money, later reimbursed, to repair a car and buy tires. The fund paid for a Christmas party for the staff, his dues at the Democratic Club, brandy for a dinner, and a staff member's parking ticket in addition to the usual newsletter funding, wedding gifts and office supplies.
In the Senate, where the contributors and expenditures over $50 must be reported, it is sometimes the amount of the fund that seems questionable.
Sen. John Tower (R-Tex.), who calls his fund the "Tower Senate Club," had a cash balance of $103,698.48 at the close of 1975. During that year he spent $27,174.18, mostly on travel for himself and his staff, plus newsletters and other items.
In the election year of 1976, the spending increased to $43,997.97, again much of it for staff travel and expenses, while the fund took in only $16,007.22, leaving a balance at the end of '76 of $75,707.73.
The contributions to the fund ranged from $100 to $300 and came from numerous Texas oil company executives, ranchers, and businessmen.
Carolyn Bacon, administrative assistant to Tower, said the fund was used to pay both political expenses and office expenses not covered by official allowances. She explained the size by saying, "When you think about the size of the state of Texas, it takes more money to represent that state."
She added that the fund was "being used in accordance with Senate rules and Federal Election Commission rules."
Since there are no laws restricting the disposition of campaign funds, the commingling of campaign funds and unofficial funds, or the transferring of campaign funds to office accounts is not an uncommon practice.
Sen. Lloyd Bentson (D-Tex.), transferred some $68,000 from "Bentsen in '76' to his office account. An aide explained that the money came from a 1973 fund-raiser in Houston that netted about $360,000. He said it was explained at the time that the money would be used for exploring the possibility of a presidential race or for the office account. A total of about $26,000 was also transferred to the office account from his senatorial campaign committee, the Sen. Lloyd Bentson Re-Election Committee.
The funds also allow House members to make money from lobbyists that they do not have to report.
Reports by the lobbyists, however, show donations when made from their political action committees.
Rep. Charles Wilson (D-Calif.) got some $2,500 from 10 unions in 1973 for his communications fund. In 1975 he got $500 from the Seafarers International Union and $100 from the Truck Operators Non-Partisan Committee of the American Trucking Associations, Inc.
Also shown receiving money from unions over the past five years of educational funds or newsletter committees were Reps. Frank Annunzio (D-Ill.), Charles Carney (D-Ohio), Charles N.Y.), Mario Biaggi (D-N.Y.), William D. Ford (D-Mich.), and John Murphy (D-N.Y.).
About 40 House members voluntarily report their funds either to the clerk of the house or in the Congressional Record. Some, like Rep. Berkley Bedell (D-Iowa), limit them to contributions from constituents, usually $100 or less.
Others, like former Rep. Don Riegle (D-Mich.), who is now a senator, and Rep. Tom Harkin (D-Iowa) accept special interest contributions, mainly from unions.
Among the largest House funds is Majority Leader Jim Wright's. Called the "Wright Congressional Club," it has had between $25,000 and $35,000 a year in it since it was started in 1971. In 1971, Wright, a Texas Democrat, repaid a note with interest for $2,037.50 from the fund.