In preparation for this rulemaking, the Alliance for Justice, Charity Lobbying in the Public Interest, the National Council of Nonprofit Associations, the National Committee for Responsive Philanthropy and OMB Watch developed four principles that we believe must be incorporated into any rule the FEC adopts. The principles are available at www.nonprofitadvocacy.org Click here to see the FEC's Federal Register Announcment. On March 4, the Federal Election Commission (FEC) approved issuance of a proposal that would establish a new threshold for when an organization becomes a regulated political committee, subject to fundraising and spending rules under the Federal Election Campaign Act. Several Commissioners and the General Counsel made it clear that they do not necessarily recommend the proposal, but feel it represents important issues that need public comment. The effect of the rule would be to greatly expand the scope of regulation, possibly reaching groups that are exempt under 501(c)(3) and 501(c)(4) of the tax code. The proposal contains several alternatives and a host of questions for comment. Under current law a group is considered a “political committee” subject to federal regulation if it has $1,000 or more in “contributions” and “expenditures” in a calendar year. The definitions of what constitutes “contributions” and “expenditures” are crucial in determining what groups must register with the FEC and operate under its regulations. Current rules define “expenditure” as direct donations to candidates, parties or campaigns, or communications that have “magic words” that directly urge voters to support or oppose candidates. This has been known as the “express advocacy” test. The Supreme Court’s decision in McConnell v. FEC said the Constitution does not require that regulation of federal elections be limited to express advocacy communications. (For more on the decision see the /node/1771. The FEC rulemaking is an attempt to clarify the law in this new legal environment, and determine if the definition of “expenditure” should be broadened accordingly. The general approach in the proposed rule is to extend regulation to any groups whose major purpose is to influence federal elections and spends more than $1,000 within 120 days of an election on voter registration, contacting voters to assist them in getting to the polls or voting absentee, and issue ads that promote, support, attack or oppose named federal candidates. No magic words would be required. Alternative definitions of “major purpose” would all apply to the current calendar year or any one of the four previous years. The alternatives are:

• a statement of purpose and spending more than $10,000 on get out the vote or candidate ads; or
• making more than half of annual disbursements for get out the vote activities or electioneering communications (broadcasts naming a federal candidate within 60 days of a general election or 30 days of a primary election); or
• making more than $50,000 in get-out-the-vote or electioneering communications.

The Commission asks for comment on whether it should use “a” major purpose or “the” major purpose as the measure for when a group becomes regulated. Although the explanation portion of the 108 page proposed rule says it is not intended to apply to organizations exempt under section 501(c) of the tax code, the language of the proposed rule itself does not have this limit. The rule also fails to define what constitutes “promoting, supporting, attacking or opposing” a federal candidate, leaving the door open to regulation of nonpartisan lobbying communications. Comments on the proposed rule are due at the FEC on April 5 for organizations that wish to testify at the public hearings, which will be held April 14 and 15. All other comments are due April 9.