FEC puts off enforcement fight


The Federal Election Commission demonstrated a rare burst of productivity Thursday, when commissioners settled one major issue, investigated another, but put off a brewing fight over how it conducts investigations for another day. 

The Republican and Democratic commissioners had no trouble giving the green light to requests brought by two separate committees to treat same-sex married donors the same as opposite-sex donors. Married donors can jointly contribute $10,400 to a candidate, even if only spouse earns income. The move was expected after the Supreme Court's reversal of the Defense of Marriage Act. 

The  commissioners were also unified in their skepticism of the Democratic Governors Association, which is asking the Commission to find wiggle room in the soft money ban introduced on state and local committees in 2002's Bipartisan Campaign Reform Act.

But the fight over how the FEC investigates complaints — outlined in its enforcement manual — hung over the meeting.

Republican Commissioner Don McGahn has led the charge in recent months to change the way in which the FEC legal staff weighs complaints alleging campaign finance law violations. McGahn wants to stop the staff's practice of communicating with other federal agencies and reading news reports before going to the commissioners for approval to begin an investigation. McGahn thinks it's dangerous and says it's not even supported by law.

Campaign finance reform groups — and editorial boards of major newspapers — have cried foul. The reformers asked the FEC to delay action until the agency is fully staffed with six commissioners instead of its current five. (Two nominees are being considered by a Senate committee now). The Los Angeles Times called McGahn's move "sabotage," saying it is meant to inhibit the agency from enforcing the law.

The FEC was expected to address the issue, but its agenda said that it would be "held over to a future meeting."

Though it wasn't on the agenda, the question did come up in the proceedings when McGahn sarcastically mused whether to approve a request about same-sex couples. "Should we wait?” he wondered. “I don’t know. Only five commissioners. A lot of people say that’s a problem," he said.

McGahn has said he's moving to change the enforcement practices for a couple of reasons. For one, it allows the Department of Justice to act on "untested legal theories" before the FEC comes to a decision on an investigation, he told Sunlight.

He also says a decision on whether to investigate should be voted on in public, not behind closed doors, which would in his mind ensure against the political targeting that the IRS has been accused of. Lois Lerner, the IRS official who led the Exempt Organization division until taking a leave of absence after pleading her Fifth Amendment right against self incrimination before a House committee hearing, once led the enforcement division at the FEC.

The FEC's recently departed general counsel, Anthony Herman, warned that the opposite would happen if McGahn prevails: It would lead to allegations that the commission is quashing investigations for political reasons. The current practice saves time, helps the legal staff make accurate recommendations, and helps DOJ avoid unnecessary investigations, Herman wrote in a recent memo.

McGahn insists he is not trying to hamstring investigations, and that he does not want the issue to be a partisan battle. He says the intent is to codify how the FEC investigates complaints.

Democratic governors want soft money

As for the request by the DGA, the group's lawyer, Marc Elias, argued Thursday that DGA should be allowed to use soft money — contributions in unlimited amounts from individuals, corporations and labor unions — to finance federal election activities such as get-out-the-vote operations. That's because, the DGA argued, Congress intended the soft money ban, passed as part of the McCain Feingold law in 2002, to apply to state and local party committees, and not associations like the DGA or its counterpart, the Republican Governors Association.

Campaign finance reform groups noted that associations of state officials are also covered by the soft money ban.

The commissioners were skeptical of DGA's argument but the group is hoping to get its way on a second one.

It wants to start a separate 527 organization, called Jobs and Opportunity, that could use soft money for federal races. It would be closely connected to DGA and lead by its executive officers, but the Democratic governors–all of whom belong to DGA–would not be members of Jobs and Opportunity. That legal loophole would allow the group to spend soft money in federal elections. In essence, DGA would be setting up the functional equivalent of its own super PAC.

The commissioners were worried that this new organization would essentially be akin to changing the sign on the office door. "It’s not entirely clear that this is a fully separate organization," the chair, Ellen Weintraub, said.

But the commissioners are working on legal language that would allow it to approve the Jobs and Opportunity request — potentially by having DGA agree that Jobs and Opportunity is a separate entity from it under state law.

The FEC has until mid-August to issue an opinion to DGA.