Bloomberg BNA: Campaign Money Freed by Supreme Court Plays $300 Million Role in Battle for Senate

Kenneth P. Doyle
Oct 21, 2014
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GROUPS AVOIDING DISCLOSURE, NOBLE SAYS

Larry Noble is a former FEC general counsel now with the nonprofit Campaign Legal Center, which supports stronger campaign finance disclosure rules. After leaving the FEC and before coming to the Campaign Legal Center, he advised corporate clients on the ins and outs of election law.

In a phone interview with Bloomberg BNA, Noble explained that the variation in form and practice of different types of politically active groups stems largely from concerns about disclosure and often specifically from promises to donors that their identity will not be revealed.

“Many donors say they don't want to be disclosed,” he said. “A lot of them are companies and individuals who would be recognized” by the public and are concerned about negative publicity or other fallout. “They wouldn't give if people knew about it,” Noble added.

He noted, however, that groups seeking to avoid disclosure have to navigate complex tax and FEC reporting rules, including rules that require greater reporting for messages of express advocacy, directly calling for votes for or against candidates. There are also reporting requirements for electioneering communications—defined by the FEC as TV and radio ads in the pre-election period that refer to candidates but stop short of express advocacy.

“If you are really cautious” about avoiding disclosure, the best way is not to run TV ads, Noble said in analyzing the shifting tactics of some of the groups operating this year.

He said donors to 501(c) groups can get around disclosure rules by saying they give for general support of a group. Under tax laws, however, such groups must have a “primary purpose” beyond running campaign ads. That factor can become a problem for groups that start up by sponsoring campaign ads and say they will do non-campaign issue ads or other activities later. Noble said these groups often cease operating after the election is over, but there is no apparent consequence for them.

“The reality is that if you had strong coordination and disclosure rules, a lot of this would go away,” Noble said of the surge in campaign spending by outside groups. The Supreme Court has said disclosure is constitutional, so “if it forces some people to stop giving, so be it.”

To read the full article at Bloomberg BNA, click here.

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