House OKs Cap on Campaign Financing : Politics: Democrats back a measure setting voluntary limits on spending and public funds for candidates. GOP critics call the bill a sham.

The House voted Monday to change its current campaign financing system by setting voluntary spending limits and providing some public funds for House candidates, even though critics argued the measure would still allow the candidates to spend nearly $1 million.

Adopted by a vote of 273 to 156, the Democratic measure was said by its sponsors to set a $600,000 ceiling on candidate spending, with no more than $200,000 of the money to come from political action committees. Candidates agreeing to abide by those limits could qualify to receive up to $200,000 of their total campaign financing from a public fund.

But the measure also contained several substantial exemptions that would permit most candidates to spend far beyond $600,000. As some Democrats explained it, candidates could spend an additional $60,000 to raise money, another $60,000 on salaries and overhead and an unlimited amount on legal and accounting fees without violating the proposed law.

Moreover, any candidate with a contested primary could spend another $150,000.

As a result, the measure’s opponents--most of them Republicans--argued that the Democratic bill set no real spending limits. Rep. Bill Thomas (R-Bakersfield) estimated that many candidates could still spend at least $750,000 and perhaps as much as $1 million without violating any of the provisions of the legislation.

“This is nothing more than a sham,” Thomas said. “ . . . Under this bill, no one will have to fundamentally change the way they campaign. It is not as advertised.”

Rep. Gerald Solomon (R-N.Y.), another opponent, called it “the Democratic Incumbent Protection Bill.”

A Times’ computer-assisted analysis of spending in the 1990 House elections found that only 80 House candidates--including both incumbents and challengers--spent more than $600,000 on their own campaigns during the last election.

Furthermore, 15 candidates spent more than $50,000 on legal expenses and accounting costs, categories that would have no limits under the House-passed measure. Rep. Don Young (D-Alaska) spent the most on lawyers and accountants: $160,399.

Although the overall spending limit would appear to have little impact, many candidates would be affected by the $200,000 limit on PAC contributions established in the bill.

The Times study found 201 candidates who ran in the 1990 House elections received $200,000 or more from PACs. The top PAC recipient was Majority Leader Richard A. Gephardt (D-Mo.), who took $762,687 from PACs.

The House-passed measure is a long way from becoming law. President Bush has vowed to veto any measure that sets spending limits or would provide candidates with public funds.

In 1990, both the House and Senate passed measures to reform their respective campaign finance systems, but they failed to agree on a single bill. House and Senate leaders have said they expect to spend most of next year trying to resolve differences between their separate bills and to work out a compromise that would also pass muster with the President.

Congressional leaders have indicated they believe pressure is growing for enactment of campaign finance reform because polls show that a rapidly growing number of voters are disillusioned with the Congress and think that incumbents have access to too much special interest money.

Although Republicans castigated the Democratic bill, they failed to offer an alternative that was any more appealing to House members. By a vote of 265 to 165, the House rejected a Republican substitute, which set no limits on overall spending or PAC contributions but would force candidates to raise 50% of their campaign financing in their own district.

The GOP bill was designed to answer critics who claim that by relying primarily on PACs and rich contributors in New York, California and Texas, today’s legislators no longer represent the interests of the people in their own districts.

Democrats charged that under the Republican bill, only candidates with the support of the wealthiest people in their districts could ever be elected. Rep. Sam Gejdenson (D-Conn.), principal author of the Democratic bill, argued that the Republican version would limit the opportunities of women and minorities, who generally do not get support from moneyed interests in their districts.

Gejdenson called the GOP proposal “the Wealthy Individual Protection Act.”

At the heart of the debate over the two bills was the question of whether taxpayers should be asked to finance congressional elections, as they have financed all presidential elections since 1976. On their income tax returns, all Americans are offered the option of designating $1 of their taxes to finance presidential elections.

Republican presidential candidates have received more than $200 million in public financing over the last two decades, but Bush and other GOP leaders are opposed to it--both in congressional and presidential elections. Polls show most Americans also oppose it.

Thomas contended the Democrats had slipped a provision into the bill at the last minute providing tax incentives for contributors.

Many details of the bill were unavailable because it had been rewritten at the last minute by Democratic leaders in an effort to garner wider support from members of their own party.