Senate To Look at Campaign Finance

By Donna Cassata
CQ Staff Writer

In all likelihood, the first bill of the 105th Congress will be the Senate Campaign Finance Reform Act of 1997, which would revamp two decades worth of laws governing spending on political campaigns.

The bipartisan bill by Sens. John McCain, R-Ariz., and Russell D. Feingold, D-Wis., largely would mirror legislation that died a quick and quiet death in the 104th Congress. The earlier bill would have banned special-interest money, provided incentives for candidates who voluntarily adhered to spending limits and prohibited the national parties from raising unlimited funds for party-building activities and then using the money to influence federal elections.

The bill was moot on the two major complaints lodged in the 1996 election cycle - the use by labor unions of membership dues for political advertisements, and the use of campaign contributions from foreign nationals for U.S. races. To address those problems, the sponsors plan to add a provision limiting campaign contributions to individuals eligible to vote, effectively banning donations from foreign nationals and children.

McCain also favors a provision requiring labor unions to get a signed waiver from members before using dues for political purposes. Feingold would consider such a provision only if it were coupled with a similar waiver from corporate stockholders.

In most other respects, the new bill would contain virtually the same provisions as the measure (S1219) that stalled in the 104th Congress. The Senate bill would:

--Spending limits and benefits. Set voluntary spending limits on primary and general Senate elections based on the voting-age population of a state. A Senate candidate in California, for example, could spend about $8 million, while an individual seeking office in Wyoming could spend close to $1.5 million. In return, a candidate would receive 30 minutes of free, prime-time air time from television stations within the state or an adjacent state, reduced broadcast rates calculated at 50 percent of the lowest amount a station charged, and discounted postage rates. Taxpayers would foot the bill for the mail discounts, and broadcasters would be required to provide the free television time.

A candidate who faced an opponent who rejected the limits would be allowed to accept larger contributions from individuals, as much as $2,000 per election, up from the $1,000 limit. Candidates who faced a wealthy opponent who spent more than $250,000 of his own funds on his campaign would also be able to accept up to $2,000 from individuals.

A candidate would have to raise 60 percent of his campaign funds from individuals in his home state.

--Reduction of special-interest influence. Allow only individuals to contribute to candidates and only a candidate's official election committee to solicit funds. It would ban contributions from political action committees (PACs), which special interest groups have traditionally used to raise funds for and funnel contributions to candidates.

The goal of the provision is to level the political playing field to eliminate apparent advantages incumbents have against challengers in fundraising. A 1995 Federal Election Commission report showed that incumbents received $59 million in PAC money in a non-election year, while challengers collected just $3 million.

The bill would make contingencies for any Supreme Court ruling on the constitutionality of a ban on PACs. If the Supreme Court ruled such a ban unconstitutional, the bill would allow a PAC to contribute to a candidate but would require the committees to adhere to the same contribution limits imposed on individuals.

--Soft money of political parties. Ban so-called "soft money," the unlimited funds that national political parties raise from corporations, unions and other sources to spend on party- building activities.

Republicans raised $121 million in soft money over a 21- month period beginning in January 1995, an increase of 166 percent from the previous presidential election cycle. Democrats collected $102 million in soft money, a jump of 232 percent from 1991 to 1992.

Soft money spending by state committees on voter registration or get-out-the-vote activities that might influence a federal election could be made only from funds that were subject to federal limits and prohibitions.

--Contribution limits. Prohibit contributions from being "bundled," which allows an individual to collect several contributions and give them as a group to a candidate. All bundled contributions would be considered the individual contributions of an intermediary and would be subject to limits on individual contributions. Currently, bundled contributions are counted separately.

--Reporting requirements. Lower the threshold for reporting contributions and expenditures from the current $200 to $50.

--Severability. Require that if any provisions of the bill are ruled unconstitutional, the other provisions will remain in effect.

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