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Senate begins debate on campaign finance bill

June 28, 2000
Web posted at: 10:57 p.m. EDT (0257 GMT)

WASHINGTON (CNN) -- In what campaign finance reform advocates call an "important first step," the Senate began debate Wednesday evening on a bill to require controversial secret tax-exempt political organizations known as "527s" to disclose their sources of income, just one day after the measure passed the House of Representatives.

"Tomorrow will be an historic day. For the first time since 1979, the Congress is going to pass a campaign finance reform bill," said Sen. Russell Feingold, D-Wisconsin, a chief advocate of campaign funding reform.

"The bill we're gong to pass is by no means a solution to all the problems of the campaign finance system, but it is a start, an important start."

The rapid consideration of the measure, set for a vote Thursday morning, hands a win to campaign finance reform advocate Sen. John McCain, R-Arizona, who was the original author of the legislation.

Though satisfied with the likely passage of this bill, McCain lamented the fact that he has been unable to pass a comprehensive overhaul of the campaign finance system.

"Would I have liked to have accomplished more? Absolutely. Will we continue our fight along with my friend from Wisconsin to enact more sweeping reform? I absolutely promise to do so," McCain said.

"We will continue to do whatever is necessary to restore the public's confidence in an electoral system."

Known as "stealth PACs," "527" organizations fall into a loophole in the tax code which allows them to raise and spend unlimited amounts of money for campaign use, many times under the guise of issue advocacy, without requiring disclosure of donors or expenditures.

McCain was attacked during his presidential bid earlier this year by an advertisement paid for by a "stealth PAC" called "Republicans For Clean Air" working on behalf of his opponent, Texas Gov. George W. Bush.

If the disclosure requirement passes as expected, it will be available for President Clinton's signature in time to affect this year's general election.

The bill would require "527" groups to disclose their identities to the IRS, report all campaign-related spending in excess of $500, and disclose the names of people who donate more than $200 to the organization.

Many Republicans, who oppose reforming the campaign finance system by limiting contributions because it curbs free speech, support disclosure of contributors.

Others, such as House Majority Whip Tom Delay, R-Texas, who has his own "527" organization, argue that a disclosure requirement still violates the first amendment because it intimidates tax-exempt groups.

McCain won a surprise victory when the same legislation initially passed the Senate last month.

Following its passage, a chief foe of campaign finance reform, Sen. Mitch McConnell, R-Kentucky, endorsed legislation to expand disclosure requirement beyond "527s" to also include tax-exempt organizations like labor unions and trade organizations.

Aides to McConnell say he is unlikely to push to expand the legislation now, but he believes disclosure requirements to be unconstitutional and, if challenged, would be struck down by the courts.

"These 527 groups are small and few [but] the constitutional questions are real," McConnell argued.

"The case law demonstrates that there are serious questions as to whether the government can require public donor disclosure of groups not engaging in express advocacy."

The Senate must vote again on the measure for procedural reasons.

The House passed the bill by a vote of 385-39.

CNN Producer Dana Bash contributed to this report.



Wednesday, June 28, 2000


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