On Feb. 18 the Federal Election Commission (FEC) approved Advisory Opinion 2003-37, which was requested by a Republican group Americans for a Better Country (ABC). It expands regulation of political committees registered with the FEC, but does not impact other groups, including 501(c)(3) organizations. However, the commissioners’ deliberations indicated that further consideration of a “range of options” for setting new boundaries of regulation would be considered in a rulemaking proceeding beginning in March. There was widespread interest in the outcome of the Advisory Opinion for ABC, since the draft submitted by staff two weeks earlier proposed a new theory of regulation that would have greatly expanded activities covered by the Federal Election Campaign Act. Hundreds of groups, including OMB Watch, signed on to comments objecting to the staff draft, saying it would extend campaign finance regulation to genuine issue advocacy and other non-partisan activities. The Republican National Committee submitted comments supporting the staff draft. Campaign finance reform groups were split on the issues, with Public Citizen, Common Cause and the Brennan Center for Justice opposing the draft because it “could chill the First Amendment rights of activists and non-profit organizations that seek to influence public policy.” Public Campaign also opposed the staff draft. Democracy 21, the Center for Responsive Politics and the Campaign Legal Center supported the draft, saying it would only apply to political committees registered with the FEC. In the end the FEC compromised on a limited draft from FEC Vice-Chair Ellen Weintraub, agreeing that the big questions should be decided in a rulemaking proceeding. Issues raised by the Advisory Opinion request, which will be considered in the upcoming rulemaking proceeding address the new legal framework created by the Bipartisan Campaign Reform Act of 2002 and the Supreme Court decision in McConnell v. FEC that upheld it. FEC regulation is limited to registered federal political committees, but the threshold for requiring registration is one of the questions left open by the Supreme Court decision. The ABC staff draft took the approach that registration should be required if a group says its “major purpose” is to influence federal elections. While this sounds simple at first, it leaves open many problematic details, such as how “major purpose” would be defined. Prior to the McConnell decision, the FEC limited its authority to “express advocacy” or specific calls for election or defeat of federal candidates. The FEC’s challenge in the rulemaking will be to find a standard that does not impact non-partisan advocacy, including grassroots lobbying and public criticism of the president or members of Congress. One standard proposed by the staff draft ABC Advisory Opinion failed to achieve this; it would have extended FEC regulation to any communication that “promotes, supports, attacks or opposes” a federal candidate, even if the election is not mentioned. Vice-Chair Weintraub said the rulemaking will give the FEC the opportunity to look at a broader range of options, including the IRS’s recent Revenue Ruling 2004-6, which lays out factors that distinguish genuine issue advocacy from partisan electoral communications. The scope of the FEC’s authority to expand the reach of its regulatory authority will be hotly contested in the rulemaking. Some reform groups and the FEC’s counsel have taken the position that the McConnell decision requires expansion of federal regulation to all political committees seeking to influence federal elections. This would bring current soft money activities under the FEC’s restrictions on contributions and expenditures. Others argue that the FEC is limited to the authority Congress provides, and that BCRA only addressed soft money and political parities and political committees funded or controlled by parties. The FEC has said it will begin the rulemaking process in early March, and after taking public comments, will issue final rules by the end of May in time for the general election. The stakes are high in a presidential election year, with Republicans hoping to limit the activities of soft money Democratic leaning groups like America Coming Together. However, in the deliberations on the ABC Advisory Opinion, FEC Chair Bradley Smith, a Republican appointee, warned that the party should not seek to win the election by silencing its opponents. More information on this issue can be found at www.nonprofitadvocacy.org, which is hosted by Alliance for Justice, Charity Lobbying in the Public Interest, National Committee for Responsive Philanthropy, National Council of Nonprofit Associations, and OMB Watch.