Nov 20, 2007 -- The Hill: New FEC rule receives mixed watchdog review
By: Susan Crabtree

The Federal Election Commission (FEC) on Tuesday voted to approve a modified rule governing corporate and union-funded political ads that will be tested throughout the presidential election.

As of Monday evening, election reform groups were raising fears that the new FEC rule would carve a large loophole in the restrictions governing political advertisements established by the Bipartisan Campaign Reform Act (BCRA) of 2002 and lead to an onslaught of negative attack ads on the eve of the presidential primary.

After the decision, reform advocates appeared somewhat mollified. One vocal critic, the Campaign Legal Center 's Paul Ryan , said the FEC improved the rule somewhat by accepting an amendment by FEC Commissioner Ellen Weintraub at the last minute.

But Ryan remained concerned about what the overall impact would be of the rulemaking coupled with the Supreme Court decision rendered earlier this year in FEC v. Wisconsin Right to Life (WRTL), which caused the FEC to act.

"The amendment significantly improved a seriously flawed draft rule," Ryan said. "It would have been a disaster without it."

Richard Hasen, a professor at Loyola Law School, continued to predict that "corporate-funded sham issue advocacy will soon hit election 2008" on his election law blog after the vote, but he appeared to place the blame on the Supreme Court decision rather than the FEC.

The WRTL decision held that BCRA cannot keep corporate and union money from paying for election ads and communications 30 days before a primary and 60 days before a general election, if the ads do not directly advocate for the election or defeat of a candidate or engage in the "functional equivalent" of doing so.

The court said that an ad is the functional equivalent of express advocacy only if it is "susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate."

The FEC was under pressure to act because the 30 days before the first presidential primary, the time period where the BCRA laws apply, will begin in less than two weeks.

In the days before the FEC's vote on the new rule interpreting the Supreme Court decision, the commissioners wrote a flurry of drafts that caused concern among the reform groups, as well as some of their usual opponents, such as James Bopp, the election lawyer who argued the WRTL case, and Bob Bauer, an attorney for presidential hopeful Sen. Barack Obama (D-Ill.) and the Democratic Congressional and Senatorial party committees.

The FEC adopted a draft written by its chairman, Robert Lenhard, with an amendment offered by Weintraub that provided a broader interpretation of evidence of "express advocacy" in the ads. It passed 4 to 1, with Hans von Spakovsky voting against it.

"While the Lenhard version will create some uncertainty on the edges, it is not fair to blame the agency for creating a wide loophole," Hasen wrote on his blog Tuesday after the vote. "As I've argued in great detail, that's exactly what Chief Justice Roberts and Justice Alito were trying to accomplish in the principal opinion in WRTL."

Public Citizen also had a mixed review of the FEC rule. The watchdog applauded Lenhard and Weintraub for "significantly reining in a potentially aberrant FEC rulemaking."

While the new rule preserves a ban on soft money funding for campaign ads, the watchdog also said it created a large exemption for ads that are deemed rightly or wrongly as "genuine issue ads."

For the most part, Public Citizen gave the commissioners credit for wrestling with the rules to come up with a measured interpretation.

"Public Citizen and other groups encouraged the FEC to closely hew to the WRTL decision," said Joan Claybrook , president of Public Citizen. "Today, the commission recognized that ads are likely subject to the soft money restriction if they highlight an election or candidacy or a candidate's qualifications or fitness for office."

Democracy 21's Fred Wertheimer issued a statement that said the new FEC rule shifts the focus to the question of how the agency will interpret and apply the new regulation to corporate and union-funded ads. When ads contain evidence of express advocacy, such as an attack on a candidate's character, qualifications, or fitness for office, the FEC must presume that such ads are campaign ads and must recognize that such attack ads can reasonably be interpreted in no other way, he argued. Unions and corporations should not be allowed to fund these ads that fall under the electioneering communication provisions of BCRA.

"Any other conclusion will take the FEC well beyond what the Supreme Court had before it in the WRTL case, and will open the door to campaign attack ads masquerading as issue ads again being funded with soft money," he said.

Commissioner David Mason, a 10-year veteran of the FEC and a former GOP congressional aide, said there's no doubt that corporations will be funding more ads this election cycle in the wake of the WRTL Supreme Court ruling.

"It's very obvious that under this ruling there's going to be corporate ads that we wouldn't have had otherwise," he acknowledged, predicting that the U.S. Chamber of Commerce will respond by funding more ads in the next eleven months.

The new rule did not exempt corporate and union-funded ads from disclosing when they fund ads to the FEC. Commissioner Von Spakovsky's supported the idea, but his motion failed.

"This was not my first choice or even my second choice," Weintraub said after the vote. "But we needed to find something that could get four votes [on the commission.]"

She said the new rule would include an accompanying explanation with concrete examples of ads that clearly violate the new rule and ones that do not.