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Liberal 527 Group Scales Back Operations

After raising more than $140 million in the last election cycle, America Coming Together (ACT), the biggest liberal “527” group, is dramatically scaling back its operations as its leaders decide what role it can play in 2006 and beyond.

Faced with a difficult fundraising environment in a non-election year, Steve Rosenthal, ACT’s CEO, said the group was “reassessing its mission,” with a decision expected later this year on its future plans.

ACT has raised more than $6 million since January and had planned to spend roughly $30 million in battleground states next year, although officials with the group acknowledged they will not come close to meeting that target now.

ACT is also certain to be laying off a number of its 28 employees, according to Rosenthal. “We’ve tried very hard to keep everyone intact, but it won’t be possible,” Rosenthal acknowledged.

Rosenthal himself will stay with the organization as CEO, although he will also begin pursuing private projects later in the year.

“It’s been very difficult difficult to raise the amount of money we had hoped to raise,” said Harold Ickes, a top Democratic political operative and member of ACT’s board of directors. “We are in the the process of re-evaluating our direction.”

ACT — formed by the leaders of the labor movement, pro-abortion rights advocates and environmentalists — raised more than $140 million last cycle, primarily in large soft-money contributions from organized labor and wealthy individuals. The organization spent all of those funds and more, running up a roughly $4 million debt as it attempted to keep President Bush from a second term.

But Bush’s victory, combined with acknowledged “donor fatigue” on the left, has made it hard for ACT to continue operations. Rosenthal said the organization will keep testing its get-out-vote message as it decides on a new strategy.

New Federal Election Commission regulations now require 527 groups with hard and soft money operations to use at least 50 percent hard-money funds in their political activities — a rule that Ickes acknowledged has had an impact on what ACT’s goals. “We raised $6 million this year, which is a lot of money on the heels of a bitterly-fought presidential race. There is a lot of disappointment out there,” he said.

At least one GOP campaign expert suspects that ACT may shut-down its hard-money operation in order to avoid having to comply with the new FEC regulation. Ickes said that “was a possibility,” but noted that no such decision has been made yet.

Ickes also said ACT’s board is closely monitoring legislation being considered by Congress that would require 527s to register with the FEC and comply with federal hard-dollar contribution limits. ACT is opposed to that bill, Ickes said.

Tracey Schmitt, a spokeswoman for the Republican National Committee, described the news that ACT was scaling back its operations as a “positive sign.”

“Americans in both parties have long lost their appetite for divisive, angry extremism,” said Schmitt. “It is high time that Democrats in Washington follow their lead.”

With ACT cutting back its activities, the Democratic National Committee and the party’s two Congressional campaign committees will once again have to shoulder the burden of organizing the bulk of field operations for the upcoming elections.

A Democratic campaign strategist with close relations to several ACT executives said there had been discussions about the effectiveness of having two parallel field operations. The strategist noted that even though ACT was working on behalf of Democratic candidates, the law prohibited these Democrats from coordinating strategy with the 527 group.

“The campaigns couldn’t talk to ACT even though they were driving the money to the field,” said the strategist. “There had been a lot of debate about having two field operations that couldn’t talk to each other.”

“So, while this idea was created off of the law, still the best and the strongest way is to run it through the party,” the Democratic strategist added.

Phil Singer, the spokesman for the Democratic Senatorial Campaign Committee, sought to minimize the impact of ACT’s decision to scale down operations, saying it would have no affect on the outlook for Democratic Senate candidates in 2006.

“We are focused on working with our campaigns and state parties to build pro-active, aggressive, targeted field operations around the country,” Singer said.