Democrats, GOP Seek Access to ‘Soft Money’ for Conventions

Democrats and Republicans have found at least one issue that unites them in the upcoming 2004 presidential campaign. It’s not terrorism or taxes. It’s “soft money.”

Both parties are claiming that corporations, unions and wealthy individuals should be allowed to bankroll their national conventions next year with six- and seven-figure checks and other expensive gifts, despite the new federal law that aims to curb such outsized political largess.

This week, the Federal Election Commission will consider petitions from the two major parties to allow committees organized to handle the conventions -- in New York for the GOP and in Boston for the Democrats -- to raise so-called soft money, the unlimited contributions given for party-building activities.

In another significant step, Republican congressional leaders are asking the commission to allow lawmakers to solicit such funds for the host committees.

Campaign reform advocates say the partisan requests, if granted, could create a breach in a law that generally prohibits national parties and federal candidates from raising soft money, forcing them instead to solicit funds in far smaller chunks. For instance, an individual can give a candidate no more than $2,000 per election.

This clash over interpretation of the new campaign law underscores how unsettled the political finance rules remain just months before the presidential caucus and primary season begins in January 2004.

And while the commission considers new regulations, the Supreme Court is expected as early as September to hear arguments over the constitutionality of the law, in a case that will determine whether it survives -- and if so, in whole or in part. The court’s decision will have a critical effect on parties and interest groups in the coming presidential and congressional elections, potentially shaking up the fund-raising world.

Officials planning the partisan extravaganzas in New York and Boston are counting on large private donations to help meet their budgets. Such gifts have become common in recent years. In 2000, for example, AT&T; Corp., General Motors Corp. and Microsoft Corp. each donated an estimated $2 million in goods and services to the parties’ national conventions.

For next year’s events, the New York host committee estimates the total cost at $80 million and the Boston committee is budgeting $49.5 million. Both figures dwarf the amount of public financing -- about $15 million for each convention -- the federal government is expected to provide.

In briefs filed last month with the commission, attorneys for the Republican and Democratic national committees argued that Congress wrote nothing into the new campaign law to target soft money for presidential conventions. The host committees in New York and Boston, they contend, are nonpartisan and therefore exempt from the ban.

“Even if every word of [the soft-money prohibition] is ultimately ruled constitutional,” wrote Joseph E. Sandler and Neil P. Reiff, attorneys for the Democratic National Committee, “nothing in [the law] even remotely addresses the issue of financing of nominating conventions.”

Sandler and Reiff say that if the commission chooses to regulate convention fund-raising, it should postpone enforcement until 2008.

“Any changes at this juncture would be enormously disruptive and seriously impair the ability of the [Democrats] to put on the 2004 Democratic National Convention,” they wrote.

In an unusual instance of bipartisanship in Washington, attorneys for the Republican National Committee echoed the Democrats’ arguments.

The campaign law, wrote Thomas J. Josefiak, chief counsel for the RNC, and Charles R. Spies, deputy counsel, “was in no way targeted at public-funding issues, nor does the voluminous law ever even mention, for example, national nominating conventions or ‘host committees.’ ”

Indeed, the leading congressional sponsors of the soft money ban, Sens. John McCain (R-Ariz.) and Russell D. Feingold (D-Wis.), appeared to give scant attention to the presidential conventions during debate before the law’s enactment in March 2002. But their opponents certainly focused on the issue.

Speaking just before the McCain-Feingold bill cleared Congress, Sen. Mitch McConnell (R-Ky.) declared it would “end party conventions as we have known them.”

McConnell added: “The soft-money ban covers the committees that are created to host these grand events.... All the soft money that you used to put on the convention the last time [in 2000] is now gone.” A ban would wipe out 80% of convention financing, McConnell predicted.

McConnell’s views are notable because he is the second-ranking Republican senator and the lead plaintiff in litigation challenging the constitutionality of the law.

Party attorneys contend that McConnell’s assertion was nothing more than legislative hyperbole.

Efforts to reach the senator for comment on the Federal Election Commission hearing were unsuccessful. In reply to an e-mail inquiry, his spokesman last week said McConnell was traveling and has generally declined to discuss the commission’s rulemaking. Proponents of the new law say that the fund-raising rules for conventions should be no different from those applied to any other federal election activity.

“The conventions have become vehicles for the infusion of massive amounts of soft money into both political parties, and to their candidates and officeholders,” wrote Donald J. Simon, an attorney for campaign-reform advocacy groups Common Cause and Democracy 21. Simon wrote that the soft-money ban “should be given full force in writing new rules to govern the funding of conventions.”

Whether the six-member commission will agree is uncertain. Two commissioners skeptical of the campaign reform movement, David M. Mason and Bradley A. Smith, expressed preliminary support for the stance of the political parties in separate telephone interviews.

“What some people would call loopholes,” Mason said, “other people would call protected activity.”

However, Mason and Smith both said they would oppose postponing any new regulations to 2008.

Ellen L. Weintraub, who chairs the commission, said she was undecided. As for the appetite for soft money, Weintraub said: “Everybody always wants to put on a fancier party and have a really splashy event and make people feel good about nominating a candidate.”