The Federal Election Commission is considering two advisory opinion requests that, in the absence of Congressional action on the DISCLOSE Act, will redefine the parameters of corporate political speech in the months leading up to the general election in November.

Both advisory opinion requests ask the FEC to rule that the Supreme Court’s decision in Citizens United v. FEC and the District of Columbia Circuit’s even more recent decision in SpeechNow.org v. FEC allow organizations to form independent expenditure-only political committees that can accept unlimited contributions from corporations, labor unions and individuals and use those funds to make independent expenditures expressly advocating the election or defeat of specific clearly-identified candidates for Federal office.

The Club for Growth filed an advisory opinion request (AOR 2010-09) with the FEC on May 21, 2010 asking two very specific, but narrow questions. First, could the Club establish an independent expenditure-only political committee, separate and apart from its existing PAC, which could solicit and accept donations from individuals that would exceed the current $5,000 limit on contributions to PACs? Second, if so, could the Club’s independent expenditure-only committee solicit and accept donations from individuals that would be earmarked for independent expenditures that would support a specific candidate – even if the individual making that donation had already maxed out to that candidate?

After Citizens United and SpeechNow, the answer to the first question is clearly yes. The second question is the more interesting of the two because it would require the FEC to invalidate one of its own regulations. Under existing rules, an individual who has already maxed out to a specific candidate may still contribute to a political committee that anticipates supporting the same candidate, but only if the individual does not give with the knowledge that his or her contribution will be expended to support that candidate in the same election. 11 C.F.R. 110.1(h). The District of Columbia Circuit’s SpeechNow decision would seem to compel the FEC to also answer this second question in the affirmative, allowing individuals to spend unlimited amounts to elect the candidates of their choosing.

The Club for Growth’s advisory opinion request is conservative, however, compared to the one recently submitted by a group of Democratic activists. Commonsense Ten registered with the FEC as a nonconnected PAC on June 11, 2010 and simultaneously filed an advisory opinion request (AOR 2010-11) with the FEC asking the Commission to confirm that the PAC could raise unlimited amounts of money from corporations, unions and individuals, provided that those funds were used only to make independent expenditures expressly advocating the election or defeat of specific federal candidates. Commonsense Ten has asked the FEC to give expedited consideration to its request because it would like to make independent expenditures in primary elections to be held in July and August.

Commonsense Ten’s advisory opinion request goes several steps beyond the requested submitted by the Club for Growth and, for that reason, may define the outer limits of what independent expenditure-only political committees will be able to do in the 2010 general election. First, Commonsense Ten didn’t limit itself to accepting unlimited contributions from individuals – it wants the FEC to confirm that it can also accept unlimited amounts from corporations and labor unions too. Second, the Club for Growth specified in its request that it would keep its independent expenditure-only committee separate and apart from its PAC. Commonsense Ten is already a PAC and its request states specifically that it intends to commingle any new donations with the contributions it has already received. The PAC did, however, specify that any new donations it receives will be used only to make independent expenditures and that the PAC will not be making any contributions directly to federal candidates, political party committees or other federal political committees that contribute to candidates or political parties.

If the Federal Election Commission does issue an advisory opinion in response to the Commonsense Ten request, it would instantly become the standard for designing independent expenditure-only political committees after Citizens United and SpeechNow. The big question, however, is whether the FEC will be able to muster a four-vote majority to issue an advisory opinion in response to either the Club for Growth or Commonsense Ten requests. The six-member FEC is evenly divided between Republicans and Democrats and the current Commission has repeatedly deadlocked 3-3 on both advisory opinions and enforcement cases.

Moreover, the Commission may be reluctant to redefine the campaign finance universe by issuing an advisory opinion only a few months before the 2010 general election. When the Supreme Court handed down its decision in Citizens United, the Commission issued a press release indicating that it intended to conduct a rulemaking to implement the decision. The Commission doesn’t really have the option not to pursue a rulemaking – the James Madison Center for Free Speech filed a petition for a rulemaking implementing the Citizens United decision just days after the Supreme Court decision was handed down.

Commonsense Ten seems to have anticipated that the FEC will try to use the pending rulemaking to avoid issuing an advisory opinion before the general election. The PAC’s advisory opinion request went out of its way to argue that the Commission is not required to wait to conduct a rulemaking in order to issue its formal interpretation of Citizens United and even cited an earlier instance in which the FEC issued an advisory opinion in direct response to a District of Columbia Circuit decision.

The Federal Election Campaign Act requires the FEC to issue an advisory opinion within 60 days after a request is submitted. Last year, the FEC changed its internal procedures to expedite advisory opinions that are election sensitive. That change in policy, however, is not a binding rule, but only a policy statement that the FEC will attempt to issue a response to an election-sensitive advisory opinion request within 20 days.

As is so often the case with FEC, those who are seeking guidance on how the Commission will interpret Citizens United and SpeechNow will have to stay tuned.

Brett G. Kappel
Counsel
Arent Fox LLP