Gingrich Political Unit Broke Rules, FEC Says : Financing: Panel’s campaign spending five years ago created the ‘appearance of corruption,’ agency charges.

Creating “the appearance of corruption,” a political committee headed by House Speaker Newt Gingrich violated federal restrictions by spending large sums five years ago to elect GOP congressional candidates--including at least $250,000 to reelect Gingrich himself, according to documents released Wednesday by the Federal Election Commission.

Gingrich, a Georgia Republican, was questioned at length by the commission in September as part of a lawsuit that seeks to compel the GOP Action Committee, known as GOPAC, to disclose the sources and disposition of more than $500,000 in contributions in the 1989-90 election cycle. The FEC contends that the money went to influence federal elections at a time when GOPAC was barred from such activities because it had not registered as a federal political action committee.

The documents quote GOPAC officials as discussing actions “to inoculate Newt Gingrich from Democratic attacks” and targeting Georgia during the election cycle in part “to protect Congressman Newt Gingrich” during the redrawing of congressional districts. Gingrich narrowly won a seventh term in 1990 by 974 votes.

Gingrich and GOPAC officials have insisted that the group did not function as a federal political action committee at that time--and therefore was not subject to federal rules limiting contributions, prohibiting corporate donations and requiring disclosure of donors and the nature of its expenses.

GOPAC sought Tuesday to have the FEC suit dismissed on grounds that GOPAC “never supported any particular federal candidate or federal candidates” before it registered as a federal political action committee in 1991.

In unusually strong language, the FEC said in a 50-page motion for summary judgment filed Tuesday in U.S. District Court that “GOPAC’s failure to register and file disclosure reports creates the appearance of corruption and has deprived the electorate of information that Congress considered essential to the public’s electoral decisions.”

The bipartisan FEC, which is responsible for civil enforcement of federal campaign finance laws, has six members, all presidential appointees requiring Senate approval. By law, there can be no more than three members of a single political party, and four votes are required for any action. Two of the five commissioners were appointed by President Clinton; the sixth recently stepped down and has not been replaced.

The release of the thousands of pages of FEC documents is expected to put added pressure on Republican members of the House Ethics Committee, which is deadlocked over the scope of a pending inquiry by an outside counsel into various allegations against the Speaker. The findings are also likely to refocus attention, at a time when the Speaker’s popularity with the American public is plummeting, on allegations that Gingrich misused his office when he was a member of the GOP minority.

One ethics complaint pending against Gingrich, who stepped down as GOPAC general chairman earlier this year, is that GOPAC’s decision not to register as a federal PAC until 1991 constituted conduct unbecoming a member of the House. Former Georgia Democratic Rep. Ben Jones, who opposed Gingrich in 1994 and filed the GOPAC-related complaint, is expected to submit the FEC file to the ethics panel as corroborating material, said Steve Jost, Jones’ campaign consultant.

GOPAC has been credited with raising Gingrich’s profile and helping in last year’s election of the first Republican House majority in 40 years.

The 6,000 pages of internal documents that GOPAC turned over to the FEC as part of the lawsuit paint an inside portrait of the elaborate efforts by Gingrich and his associates to develop and communicate ideas and build a “farm team” of state and local elected officials who would eventually run for Congress in key districts.

The documents also discuss helping Gingrich retain his own seat.

The FEC maintains that GOPAC spent in excess of $250,000 for consultants’ salaries and travel costs and other “Newt support” to reelect Gingrich in 1990.

The depositions, GOPAC meeting transcripts, correspondence and other materials also include several letters from major GOPAC corporate donors seeking legislative help in resolving their problems with federal regulatory agencies, ranging from asbestos cleanup to a Texas firm’s dispute with Mexican cement producers.

GOPAC officials said that the documents support their contention that the organization limited its political involvement to helping elect non-federal candidates.

“Nowhere in the 6,000 pages of documents we turned over is there any indication that we specifically helped a federal candidate,” said Lisa B. Nelson, GOPAC’s executive director. Nelson said that the judge hearing the lawsuit told the FEC it needed to prove that GOPAC supported a specific federal candidate if the agency hoped to prevail. Of all the records released Wednesday, Nelson said, the only federal candidates the FEC claimed that GOPAC supported were President George Bush, an opponent of former Democratic Speaker Jim Wright and Gingrich himself. But in none of those cases, Nelson said, did the records show GOPAC made direct contributions. “I think they are reaching pretty far to try to make the case,” she said.

There is no dispute that GOPAC worked to elect a Republican majority in Congress by sending out mailers and fund-raising solicitations urging voters to oust the House Democratic leadership. But while GOPAC leaders maintain that the only individual candidates they directly supported were running for state and local offices, the FEC insists that GOPAC’s “major purpose was to influence the election” of House members.

The lawsuit is based on a complaint filed by the Democratic Congressional Campaign Committee in 1990.

On May 7, 1991, the FEC announced that it had found reason to suspect that GOPAC had improperly failed to register as a federal political action committee. The following day, GOPAC did so but declared that only a small percentage of its funds were channeled to federal elections. It continued to reveal limited amounts of its fund-raising and spending records until this year, when Gingrich announced a new policy of full disclosure in the face of intense public criticism.

In addition to requiring federal PACs to file periodic campaign reports with the FEC, federal election law restricts individual contributions to a political action committees to $5,000 per election. GOPAC, in contrast, set $10,000 as the minimum annual donation for charter members.

Although GOPAC was founded in 1983, the scope of the suit is confined to 1989-1990. In its original court filing, the FEC said that GOPAC had federal expenditures of $556,552 during that period. This means that if the FEC wins the case, GOPAC could face civil fines as high as that amount.

A 79-page transcript of Gingrich’s Sept. 26 deposition shows that he was grilled by FEC lawyers at his attorney’s Washington office about GOPAC activities and whether the organization engaged in supporting candidates for federal office.

Gingrich responded that GOPAC “worked very hard with our lawyer to always draw a very clear line” between supporting federal candidates, which was handled by the National Republican Campaign Committee, and state or local activities, which was GOPAC’s responsibility.

When asked about specific memos, fund-raising events and other documents that appeared to indicate GOPAC had actively supported federal candidates during the 1989-90 election cycle, Gingrich often said that he was unaware of details.