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Money Matters: An Opportunity Lost?

A federal judge last week denied a request by conservative activists to lift spending limits on ad buys and other independent expenditures while they tangle in court with the Federal Election Commission. [IMGCAP(1)]

Lawyers for, which currently exists only on paper, were told by the United States District Court for the District of Columbia on July 1 that the group must register as a political action committee if it plans to raise or spend more than $1,000. The group sued the elections regulator earlier this year, arguing that the $5,000 individual limit on contributions to political groups violates its constitutional rights.

Several prominent conservative activists are affiliated with the group, including Club for Growth Executive Director David Keating and Center for Competitive Politics Chairman Bradley Smith, a former FEC commissioner.

“We’ll never know if races we lost the opportunity to speak about would have turned out differently if voters knew more about the candidates’ stands on First Amendment rights,” Keating said in a statement after the ruling. “It is baffling that Americans are barred from speaking to Americans about who should be elected to public office.”

The group said it plans to appeal the decision.

Campaign finance reform groups, which are fighting’s challenge, applauded the judge’s decision. Democracy 21 and the Campaign Legal Center both signed a friend-of-the-court brief supporting the current law.

“This is an important victory in the effort to ensure that 527 groups spending money to influence federal elections comply with federal campaign finance laws, including the limits on contributions to such 527 groups,” Democracy 21 President Fred Wertheimer said in a statement.

“The FEC found that 527 groups made more than $200 million in illegal expenditures in the 2004 presidential election. … Democracy 21 is monitoring the 2008 presidential campaign with the goal of filing complaints and requesting investigations, as appropriate, to help prevent similar violations in the 2008 presidential and congressional elections.”

Fightin’ Illini. Rep. Mark Kirk (R-Ill.) and business consultant Dan Seals (D) are gearing up for the most expensive House race in the Chicago area this cycle — and it may turn

into the most expensive race in the country that doesn’t involve a self-funder.

Both candidates are already trumpeting their second-quarter fundraising figures, even though they aren’t officially due to be released until July 15.

Early Monday afternoon, the Seals campaign announced it had raised more than $635,000 in the second quarter of the year ($2.1 million overall for the cycle) and will show $1.17 million in cash on hand as of June 30. Those are impressive numbers for a challenger anywhere in the country.

Four hours later, Kirk released his fundraising figures, including $900,000 raised in the second quarter ($3.87 million for the cycle) and $2.85 million in the bank.

Both candidates have more money at this point than they did in their 2006 match, when Kirk bested Seals in the 10th district, 53 percent to 47 percent. The Congressman spent more than $3.5 million in the previous cycle, compared with almost $1.9 million for Seals. The Democratic Congressional Campaign Committee chipped in a mere $158,000, while the National Republican Congressional Committee sat the race out.

That election was overshadowed by very competitive and extremely expensive races in the neighboring 6th and 8th districts. But this year, the Kirk-Seals matchup will be the main event.

In the 6th district in the previous cycle, then-state Sen. Peter Roskam (R) battled Iraq War veteran Tammy Duckworth (D) in an open-seat race that received national attention. Roskam spent $3.3 million and the NRCC almost $3.4 million compared with Duckworth, who spent more than $4.5 million, and the DCCC, an additional $3.2 million, in a race Roskam won 51 percent to 49 percent.

With Illinois Sen. Barack Obama (D) at the top of the ticket, Roskam can’t take anything for granted, but the race has not developed for the Democrats. Challenger Jill Morgenthaler (D), also an Iraq War vet, raised $307,000 through March 31 and had only $163,000 on hand. Roskam raised almost $1.4 million through the first quarter with $967,000 in the bank.

In the 8th district, Rep. Melissa Bean (D) spent almost $4.3 million in the previous cycle in her successful re-election run, and the DCCC came in with about $1.3 million. Her opponent, wealthy businessman David McSweeney (R), spent $5.1 million (including primary spending), but the NRCC tacked on another $2.4 million. Bean won 51 percent to 44 percent.

This year, Republicans have another wealthy businessman running, Steve Greenberg, but it’s unclear how much he’s willing and able to invest in the race. He raised almost $523,000 through March 31 but had only $5,000 in cash on hand. Bean raised more than $2.2 million through the first quarter with almost $1.4 million in the bank, and she is a heavy favorite for re-election.

Open-seat races in Illinois’ 11th and 18th districts will also get national party attention this year, and the 14th district rematch between new Rep. Bill Foster (D) and dairy magnate Jim Oberweis (R) could also be competitive.

For What It’s Worth. A former local mayor has filed an FEC complaint against retired Marine Corps officer Tom Manion (R), who is challenging freshman Rep. Patrick Murphy (D) in the southeastern Pennsylvania 8th district.

A copy of the complaint supplied by the Democratic Congressional Campaign Committee showed that former Riegelsville Mayor Todd Myers, who has run for office both as a Republican and Democrat, alleged the Manion campaign improperly used staff and resources from Worth and Company for a March 25 fundraiser in Pipersville, Pa.

Myers’ complaint alleges that per FEC rules, Manion’s campaign should have paid for the company’s resources and staff time in advance and that the expenditure should have showed up on the first-quarter financial report due April 15.

Manion campaign manager Jerry Morgan said the campaign had not yet received the complaint as of Tuesday afternoon. Morgan also said the campaign paid for the event’s costs as soon as the bill came and said a record will show up on the next financial report, which is due on July 15.

“As soon as we got the invoice, they were paid,” Morgan said.

FEC spokeswoman Michelle Ryan confirmed the commission had received the complaint. After the agency’s general counsel reviews the complaint and confirms it was properly filed, both parties will be notified within five days and Manion’s campaign will have 15 days to respond. Myers’ complaint was dated July 1, but the FEC could not confirm when it received the paperwork.

Democrats saw the incident as an attempt by Manion to skirt fundraising rules.

“It appears Tom Manion is trying to play fast and loose with the law,” said DCCC spokesman Doug Thornell. “This is a serous allegation and raises numerous questions about the conduct of Tom Manion’s campaign for Congress.”

CREW Questions Coleman’s Crib. The watchdog group Citizens for Responsibility and Ethics in Washington last week asked the Senate Ethics Committee to look into Sen. Norm Coleman’s (R-Minn.) perhaps overly cozy relationship with a GOP operative.

As reported recently in National Journal, Coleman may have violated ethics rules by paying rent irregularly on his Capitol Hill basement apartment, which is owned by Jeff Larson, the lawmaker’s political consultant. At the time, Coleman also employed Larson’s wife at his St. Paul office, according to CREW, while the lawmaker’s political action committee was run out of Larson’s telemarketing firm.

CREW alleges Coleman’s living arrangement violates the Senate’s ethics rules because their relationship “appears to be more business than personal.” And because Larson does not live in the building, Larson “is not hosting Sen. Coleman and ‘the personal hospitality’ exception would not apply.”

“Few Americans have landlords who sometimes fail to cash their rent checks, ignore unpaid rent, or accept furniture in lieu of rent,” CREW Executive Director Melanie Sloan said in a statement. “That Sen. Coleman has just such a landlord, who also happens to financially benefit from his relationship with the senator creates exactly the sort of appearance of impropriety that undermines the public’s faith in government.”

Shira Toeplitz contributed to this report.

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