FEC Approves New 'Soft Money' Limits

WASHINGTON – Interest groups spending big donations on ads and voter outreach in the presidential race will face new limits after the fall election under rules approved by federal regulators. Campaign watchdogs criticized them as too little, too late.

The Federal Election Commission (search) rules, approved 4-2 Thursday, will require nonparty groups that raise more than $1,000 to take only limited donations from individuals if they tell donors the money will be used to promote or oppose a particular presidential or congressional candidate. They will also have to disclose their financing and spending to the FEC.

The commission also placed new spending restrictions on groups that collect both "soft money" — corporate, union and unlimited donations — and "hard money," limited donations from individuals.

The commission said the groups will have to use hard money, which is more difficult to raise, to cover at least half the cost of their overhead, nonpartisan voter drives and ads, phone banks and mailings that refer to a federal candidate.

Commissioners who supported the changes argued they would sweep in many groups now criticized for spending soft money on ads and voter drives despite a broad ban on the use of the big donations in federal elections.

"I think we have done something huge," said Commissioner Ellen Weintraub (search), a Democrat. "It isn't tinkering. It's a big deal."

Democratic Commissioner Scott Thomas, who voted against the rules and wanted more restrictions, said he feared the regulations would be easy to evade. Groups would just have to alter the phrasing of their fund-raising solicitations to avoid falling under the FEC's oversight, he said, expressing frustration that the commission didn't go further.

"Congress, it's your turn," Thomas said.

Commission lawyers and Republican Commissioner Michael Toner (search) had also proposed tougher restrictions.

The changes will take effect starting with the 2005-06 election cycle. Campaign finance watchdogs, who want soft-money spending in this year's election blocked, criticized the commission.

Fred Wertheimer, head of Washington-based Democracy 21, said the new rules won't stop soft-money groups "from blatantly violating the federal campaign finance laws." He called them "an effort to create the illusion that this rogue agency was doing its job."

Thursday's vote marked the second time this year that the commission debated how a new campaign finance law affects nonparty groups spending huge sums in this year's election.

The law, which took effect in November 2002, bars national party committees and federal officeholders and candidates from raising or spending soft money, and broadly bars its use in federal elections.

In response, several partisan groups have popped up to raise soft money and spend it on ads and get-out-the-vote activities, which the national party committees now lack the large donations to finance. Democratic and Republican activists are involved in such groups, though organizations that oppose President Bush's re-election have raised millions of dollars more than their pro-Bush counterparts so far.

The commission decided last spring to delay a ruling to give it more time to consider proposed changes, prompting Thursday's vote.