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Tuesday, July 9, 2024 | Back issues
Courthouse News Service Courthouse News Service

Group Seeks Removal of Campaign Enriching Provisions from Tax Bill

A nonpartisan campaign finance watchdog is asking Washington lawmakers to remove language from the GOP tax overhaul plan that they believe could further open the floodgates on troublesome campaign contributions.

WASHINGTON (CN) - A nonpartisan campaign finance watchdog is asking Washington lawmakers to remove language from the GOP tax overhaul plan that they believe could further open the floodgates on troublesome campaign contributions.

The Campaign Legal Center, run by Trevor Potter, a former chair of the Federal Election Commission, sent a letter to leading Senators on the Appropriations Committee Monday asking them to remove language the group fears will have drastic consequences in the way politicians, churches, and private businesses work with money in politics.

The legal center's main concern is a mechanism called a "joint fundraising agreement" that was employed by both Donald Trump and Hillary Clinton during the 2016 presidential campaign.

These agreements allow a single donor to write individual checks to multiple entities, and let the candidate and national party combine the funds for a single purpose.

This, according to Brendan Fischer, director of the center's Federal and FEC Reform Program, enables a donor to skirt the individual $2,700 limit per election to a presidential candidate; the $33,400 per year limit on contributions to a national party committee; and the $10,000 per year limit to each of a party’s 50 state party committees.

By aggregating this contribution limits, the well-heeled donor can write a single six- or seven-figure check that is ostensibly divided between the participating committees.

In 2016, Fischer said, the money raised through Clinton’s and Trump’s presidential joint fundraising committees was deposited in the state party accounts and then almost all of it was sent to either the Democratic or Republican National Committees. The committees were then free to spend the money to benefit their respective presidential candidate.

"The Senate appropriations bill would make this already problematic situation even worse,” Fischer said.

Currently, the only check on a presidential candidate controlling how the national party spends joint fundraising proceeds are the “party coordinated expenditure limits.”

"As the name suggests, party coordinated expenditure limits cap how much the DNC or RNC may spend in coordination with a candidate," Fischer wrote. "By narrowing the definition of 'coordination' for purposes of the party coordinated expenditure limits, the Senate bill would effectively eliminate those limits, and allow presidential candidates to control how the parties spend the entirety of the massive checks raised through joint fundraisers."

But this isn't the only appropriation measure aimed at further entrenching the role of so-called dark money in the political process, he said.

One measure would roll back provisions of the Johnson Amendment, a 1954 law that prohibits churches from participating in political activity.

The prohibition was targeted in the House version of the bill, and while that target was removed in the Senate, amendments that block the Internal Revenue Service from enforcing the Johnson Amendment were kept.

Another measure that survived keeps the IRS from “issuing, revising, or finalizing rules clarifying the definitions of political activity for 501(c)(4) entities.”

The Campaign Legal Center said passing such a measure would deprive tax-exempt groups the clarity needed to “protect robust civic engagement” while opening a window for “dark money actors” to find new ways to exploit tax-exempt groups.

A change to the Securities and Exchange Commission's authority is also on the CLC’s removal list.

The amendment would stop the SEC from developing a rule which would force companies to release their campaign donation history to stockholders.

“The Supreme Court’s 2010 Citizens United v. FEC decision fundamentally changed our nation’s campaign finance laws," Fischer said. "In the years since that decision, at least $800 million has been spent on political advertising by organizations that do not disclose their donors,” reads the letter. “The result is that investor demand for this information has only increased, as the magnitude of the problem and the potential for abuse has skyrocketed.”

But one man who found himself challenging a well-financed incumbent in 2013 is not worried about the ramifications of these measures.

Rep. Dave Brat, R-Va., was a professor at Virginia's Randolph–Macon College when he unseated former House Majority Leader Eric Cantor. Brat secured victory after raising just over $200,000 -- about $7.5 million less than his opponent.

“Three years ago I ran for Congress, and I promised to support term limits and not become consumed with the power politics of D.C.,” said Brat in a statement sent to Courthouse News.

“The D.C. establishment machine did not like it and I was outspent nearly 40 to 1 in my race, largely fueled by D.C. money.”

Since taking office, Brat has challenged limits on campaign donations and spending, arguing measures like the Johnson Amendment limit free speech and actually help to consolidate money and its influence in Washington.

“That is not the way to get all of this special interest money out of politics,” he said. “The way to reduce special interest influence is to remove the culture of cronyism out of Washington where lobbyists seek to get their piece of a nearly $4 trillion annual budget.”

With the Senate's passage of its tax plan early Saturday morning, the next step is for the leadership of the House and Senate to reconcile the differences in their respective bills.

The Campaign Legal Center said it has not decided what it will do if the measures it objects to remain in place, but legal action is not out of the question.

“I don’t know that there would be any grounds in a lawsuit with any of these specific provisions,” Fischer said. “But we’re a legal shop. We file complaints ... And these are bad ideas. Both Republicans and Democrats should oppose them."

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Categories / Government, Law, National, Politics

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