CAP Calls for Administration to Take Action through IRS, SEC, Federal Contractors

Center for American Progress: “”Specifically, CAP is calling on the executive branch to act in the following three areas:

  • IRS rulemaking on political activity by nonprofit organizations: Current regulations enable so-called dark-money groups to masquerade as 501(c)(4) “social welfare” organizations, thereby avoiding campaign finance disclosure laws. The IRS should clarify the rules for 501(c) organizations and should also tackle the problem of undisclosed political spending more directly by amending the regulations for Section 527 of the tax code. Rather than simply regulating dark money groups out of Section 501(c), the IRS should regulate those groups into Section 527 and thereby mandate public disclosure of donors.
  • Political activity by federal contractors: The executive branch should mandate further disclosure of political spending by federal contractors and should furthermore require those contractors take steps to ensure that they are not making impermissible federal political contributions.
  • SEC rulemaking: Currently, there is no rule requiring corporations to disclose political activity expenditures to their shareholders. The SEC should prioritize the development and implementation of a political activity disclosure rule. This corporate transparency would not only help to ensure that corporate spending is in line with shareholder interest, but it would also combat the problem of dark money.”

More information here.

FEC to Consider Loosening Rules on PACs to Draft Candidates

National Journal: “The current interpretation of the rules allows draft groups to raise funds for a specific prospective candidate, which would then be given to that candidate if he or she decides to run before the filing deadline for the race the draft group identified.

“Under the guidelines expected to be approved Thursday, the groups will have more options on what to do if their candidate doesn’t run. The rules would allow a draft group to promise would-be donors that if their preferred candidate doesn’t enter the race, the money would then go to a second candidate. For example, they could say that if Warren doesn’t run, the money would instead go to Sen. Bernie Sanders. The new rules would also give the groups more leeway to set deadlines for their candidates to enter the race.

“The new rules would also allow groups to raise money for a candidate who fits certain criteria. Specifically, a group could raise funds for ‘the first female president,’ which would go to the eventual party nominee should the nomination go to a woman.”

FEC Member Call to Consider Requiring Disclosure for Internet-Based Campaign Media Generates Conflict

Sacramento Bee: “We have a regulation that I find very frustrating, that essentially exempts anything that’s web-based from the regulations” that require disclosure of who pays for other kinds of political advertising,” [Commissioner Ann] Ravel said Thursday in a meeting with the Sacramento Bee Editorial Board to discuss a variety of federal election issues. Ravel becomes chairman of the commission early next year.”

“It would mean if a campaign is going to put something on a different medium than on TV that there are ways that those things could be exempted… from disclosure,” she said. “If campaigns are moving into the Internet, as they are, we need to be thoughtful about those distinctions. We need to be informed.'” [Brackets added]

“It’s an idea that hasn’t sat well with Lee Goodman, the Republican who chairs the FEC.”

Note: the text here has been rearranged from the original article.

Anti-Reform Group Accuses Mayday PAC of Failing to Use Required Disclosure Language in Ads

Free Beacon: “‘Paid for by Mayday PAC. Not affiliated with any candidate or campaign,’ the group disclaimed in eight of its New Hampshire radio ads. A compliant disclaimer would’ve said that the group “is responsible for the content of this advertising.”

“Small changes to disclaimers in ads also allowed MAYDAY to reduce the time in 30 or 60-second spots devoted to satisfying the FEC’s disclaimer requirements. That allowed the group to devote more airtime to the actual contents of the ad.

“‘Mayday PAC saved approximately 10 percent of its advertising costs compared to other non-candidate speakers’ by illegally abridging disclaimers on two New Hampshire television ads, CCP said. ‘This amount is not trivial.'”

“After publication, Lessig directed inquiries about the complaint to this statement on his website: ‘To be clear: Every Mayday.US ad fully identified Mayday.US as its sponsor. And unlike Super PACs that accept dark money, Mayday.US discloses every contribution (over $200) as well. None could be confused about whom the ad was from, and anyone who cared could identify whom the PAC was funded by.'”

My take: appears that Mayday may have made some mistakes here, but hypocrisy is a bit far – Lessig doesn’t support the current disclosure rules, he wants to eliminate the need for them altogether.