Skip to content

FEC Must Rewrite Regulations

An appellate court has denied a request by the Federal Election Commission to reconsider a lower court ruling that had struck down 15 key regulations the agency drafted to implement the Bipartisan Campaign Reform Act.

The decision by the U.S. Court of Appeals for the D.C. Circuit late last week puts the agency on a high-pressure course to rewrite acceptable regulations to implement the 2002 law before next year’s midterm elections. Many of the invalidated rulemakings cut to the very core of campaign finance law and form the basis for the interactions of candidates and interest groups during the course of the campaign. Unless the agency significantly picks up the pace, it’s unlikely the new rules would be in place before next spring, at the earliest.

“We have an obligation to move as soon as possible,” said Republican FEC Commissioner Michael Toner, while also expressing disappointment about the D.C. Circuit’s ruling. Toner was perhaps most fervent among the commissioners about appealing the September 2004 determination by the district court that the agency had not correctly implemented the soft-money ban.

Although the FEC has held a number of hearings on certain provisions of the regulations thrown out by the district court, only one new regulation out of 15 has been reissued in its final form, more than a year after U.S. District Judge Colleen Kollar-Kotelly rejected the regulations for lack of proper justification or outright incompatibility with the law. None of the 14 other regulations is in final form.

It’s been nearly three years since BCRA went into effect and outlawed soft money in federal elections.

When she denied the agency’s request for a stay last October, Kollar-Kotelly made clear that the FEC should go forth with rulemaking proceedings so new regulations could be issued should the agency lose its appeal. Such regulations, the judge wrote, should be crafted with “reasonable expediency.”

Democracy 21 President Fred Wertheimer, a member of the legal team who brought the case, doesn’t think the FEC’s pace has been anywhere near reasonable. “All of this raises very serious questions about whether the FEC has failed to comply with the judge’s order to proceed with ‘reasonable expediency,’” Wertheimer said, adding that it is “essential for the FEC to move immediately” in order to adopt new regulations effective for the 2006 elections.

Brought by Reps. Marty Meehan (D-Mass.) and Christopher Shays (R-Conn.), the suit challenged the FEC’s original regulations as “arbitrary,” “capricious” and in conflict with the law they helped write. Sens. John McCain (R-Ariz.) and Russ Feingold (D-Wis.), the principal Senate co-sponsors of BCRA, joined the case in “friend of the court” briefs.

In addition to appealing Kollar-Kotelly’s determinations on the merits, the FEC had also challenged Meehan and Shays’ standing to bring the suit. In July, a three-judge panel for the D.C. Circuit upheld Kollar-Kotelly’s decision. The FEC appealed to the full circuit, which on Friday denied a rehearing of the case in front of all active judges on the appellate court.

The three-judge panel in July affirmed the lower court’s ruling in all respects, finding that the plaintiffs had standing to bring the challenge and that the district court correctly struck down the five rules the FEC defended in the appeal.

In September 2004, Kollar-Kotelly threw out 15 of 19 regulations the plaintiffs challenged, ruling that the agency had repeatedly misread the law. Kollar-Kotelly determined that one regulation ran “completely afoul” of the law, while another would “foster corruption” and yet another “would render the statute largely meaningless.”

Also lurking in the not-so-distant background is the incomplete commission, which is down one member since Republican Commissioner Brad Smith left at the end of his term. Three of the five remaining commissioners are working under expired terms. The law allows the commissioners to remain until their successors are confirmed.

But Congress and the president have studiously avoided the confirmation process for most of the past decade, instead choosing to put members on the commission via recess appointment. Indeed, that is what is expected to happen when Congress adjourns — either sine die or just for a one- or two-week recess — sometime in November.

What remains is an agency with more than a dozen contentious and difficult regulations to craft just a year out from the next election. At stake are such issues as how candidates can coordinate with outside groups under the law, what constitutes “soliciting” contributions, and the ability to conduct federal election campaign activity on the Internet within the confines of BCRA — all of which will determine the height and depth of the wall between soft money and federal candidates and the roles outside organizations play as conduits.

For most, if not all, of those issues, more hard work remains than the FEC has accomplished to date. “It’s going to be a major undertaking,” Toner said.