Letter to FEC Expresses Deep Concerns about the Agency

In a letter sent today
by seven reform organizations to the six Commissioners who serve on the
Federal Election Commission (FEC), the groups strongly criticized the
agency for its misguided rulemaking priorities.

The groups also strongly criticized three of the six Commissioners-Vice
Chairman Matthew Petersen, Commissioner Donald McGahn, and Commissioner
Caroline Hunter-for their demonstrated "distinct lack of interest in
enforcing" the campaign finance laws.

The votes of four of the six FEC Commissioners are required to take any enforcement action.

The letter was sent by Democracy 21, the Campaign Legal Center, the
Brennan Center for Justice at the NYU School of Law, Common Cause, the
League of Women Voters of the United States, Public Citizen and U.S.
PIRG.

The groups called for fundamental changes in the approach used by the
President to nominate Commissioners to the FEC and in the structure and
authority of the agency.

The letter urges that President Obama:

establish a system by which an advisory group made up of
distinguished Democrats, Republicans and independents or members of
other political parties, would provide him (and future Presidents) with
a list of potential nominees for each FEC appointment, from which he
would select a nominee. This would change the longstanding practice of
having FEC nominees chosen by congressional leaders and party
officials.

The groups' letter was sent to the FEC is in the midst of its
fast-track rulemaking on changes to its "agency procedures," mostly
relating to enforcement practices as they affect the interests of
respondents in enforcement proceedings.

The letter expresses deep concern about the FEC giving priority
treatment to its current rulemaking on "agency procedures," while the
agency still has failed to adopted a lawful regulation on
"coordination," almost seven years after the requirement to do so was
enacted in the Bipartisan Campaign Reform Act of 2002 (BCRA).

The coordination provisions are essential elements of the contribution
limits and prohibitions contained in BCRA and earlier campaign finance
laws.

According to the letter:

In September 2007 the federal district court in
Washington, D.C. invalidated as contrary to law the Commission's deeply
flawed rules on coordination issued to implement BCRA-rules which are
essential to the proper functioning of the law.

This district court action in 2007 followed the court's invalidation in
2004, as contrary to law, of the first version of the FEC coordination
regulation.

In its 2007 decision, as it had in its 2004 decision, the district
court remanded back to the Commission, the coordination regulation, as
well as other important regulations promulgated to implement BCRA that
were struck down by the court, "for further action consistent with this
opinion." Shays v. FEC, 508 F. Supp. 2d 10, 71 (D.D.C. 2007) (Shays III).
The court said that "it assumes that, on remand, the Commission will
act promptly, in light of the impending 2008 election." Id.

That was seventeen months ago.

The letter continues:

Instead of fixing the regulations, however, the Commission
appealed the district court decision. The FEC lost its appeal in the
D.C. Circuit Court of Appeals, as it had when it appealed the district
court ruling in 2004 striking down the first FEC coordination
regulation.

That was eight months ago.

The letter points out that the FEC still has failed to issue
coordination regulations that comply with the law. According to the
letter:

One might reasonably have thought that fixing the
coordination regulation, and the other BCRA regulations invalidated by
the courts in Shays III, would have commanded the Commission's urgent attention, especially since BCRA was enacted in 2002.

Yet, as far as we are aware, the Commission has done nothing to replace
the defective coordination regulation and the other BCRA regulations
invalidated in Shays III,
and instead has chosen to consider this "agency procedures" rulemaking
on a fast-track basis and moved it to the head of the line.

The effort to obtain an FEC coordination regulation that complies with
the campaign finance laws has been going on for more than six years,
over three federal election cycles, and has involved two district court
decisions and two court of appeals decisions, each of which rejected as
contrary to law the FEC's coordination regulations. Yet the FEC still
has failed to adopt a lawful coordination regulation to govern federal
elections.

The letter also notes another rulemaking that has been sitting for more than a year and a half without resolution stating:

In another matter, the pending FEC rulemaking on "hybrid"
ads has languished on the Commission's docket since a public hearing
was held in July 2007, leaving unaddressed by the FEC an area of
significant abuse where clarification of the rules is plainly required.

The letter states that the current rulemaking deals largely with due
process rights for respondents in agency enforcement proceedings.
According to the letter:

This is more than a little ironic since recent actions by
three of the six FEC Commissioners-Vice Chairman Petersen, Commissioner
McGahn, and Commissioner Hunter-indicate not only sharp ideological
disagreements with the campaign finance laws, but also a distinct lack
of interest in enforcing them.

To illustrate the point, one need look no further than the outcome in
MUR 5541 (The November Fund), in which the three Commissioners cited
above voted to reject a conciliation agreement that was negotiated by
the professional staff of the agency, based on past precedents of the
agency, and that was agreed to and signed by the respondent in the case.

The Statement of Reasons issued by the three Commissioners goes so far
as to reject the construction of "electioneering communication" set
forth in Chief Justice Roberts' controlling Supreme Court opinion in FEC v. Wisconsin Right to Life, 127 S. Ct. 2652 (2007). See
Statement of Reasons of Vice Chairman Matthew S. Petersen and
Commissioners Carolyn C. Hunter and Donald F. McGahn in MUR 5541 (Jan.
23, 2008) at 6 n. 22 ("[W]hat Justice Alito anticipated could
happen-that the standard set forth in the Chief Justice's opinion may
not prove to be sufficiently clear and could, without the reversal of
the holding in McConnell, impermissibly chill political speech-apparently has happened.").

When there are three Commissioners who have little apparent interest in
enforcing the laws-indeed, who support reversal of the Supreme Court's
opinion in the McConnell
case-and who also are able to block enforcement of the laws by the FEC,
there seems to be little point to a rulemaking about how to improve the
rights of respondents in enforcement cases.

The letter states that while due process rights for respondents in
enforcement proceedings are "essential," the Commission "should be
extremely wary of taking unnecessary new steps that would make an
already slow and cumbersome enforcement process even more so. Many of
the proposals discussed in the current rulemaking would tend to make
the status quo worse by slowing the current enforcement process even
further."

"Under current procedures, for example, it is not uncommon for the
FEC to take three or four years to resolve complaints. Creating
unnecessary new procedures that would slow the disposition of
enforcement matters even further would not serve the public interest,"
according to the letter.

The letter further notes that the call for additional procedural
protections "does serve to highlight one of the key structural problems
with the agency-the fact that the FEC was not given the powers to make
its own adjudicatory decisions about violations of law and impose its
own penalties-powers that many other agencies have."

The letter states, "The types of due process rights that the defense
bar advocates for respondents may be appropriate for an agency that can
exercise its own adjudicatory authority. But there is little reason to
provide respondents with such rights where the FEC has no such
adjudicatory power."

The reform groups state in the letter that they have not participated in the rulemaking on agency procedures because:

it cannot and does not address the fundamental problems
that plague the FEC-problems that require changes to be made by
Congress in the structure and powers of the agency, and changes to be
made by the President in the appointment process for nominating FEC
Commissioners.

These problems have often left the FEC largely dysfunctional.

This does not mean, however, that the FEC cannot and should not be
doing a better job of enforcing the campaign finance laws under
existing circumstances. Operating within the framework of the agency's
powers, Commissioners are obligated to faithfully administer and
enforce the laws as enacted by Congress and construed by the
courts-regardless of whether you agree or disagree with the laws or the
court decisions construing them.

The letter from the reform groups states that "the structural flaws in
the Commission's enforcement authority are a statutory problem that
must be fixed by legislation." The groups state that they will support
legislation, like H.R. 421 introduced in the last Congress, "to replace
the FEC with a new agency to administer and enforce the campaign
finance laws, one that will have its own power to adjudicate violations
of law and impose appropriate sanctions, subject to judicial review."

The letter also challenges the way FEC Commissioners are currently named. According to the letter:

A central cause of the agency's problems over the years
has been its process for appointing Commissioners, which in practical
application allows the congressional leadership of both parties, in
conjunction with the national party committees, to name the FEC
Commissioners, and thereby to choose their own regulators.

In reality, the President has become little more than a pass-through,
receiving the names provided by congressional leaders and party
officials, and passing them on to the Senate as nominees for
confirmation as FEC Commissioners.

The result of this process has too often been the appointment of
Commissioners who adhere to a very truncated view of the law, either as
a matter of ideology or personal constitutional interpretation, or who
are responsive to partisan interests in the administration and
enforcement of the law.

The letter calls for a change in the approach by which the President selects Commissioners to nominate to the FEC:

That is why we will urge President Obama to establish a
system by which an advisory group made up of distinguished Democrats,
Republicans and independents or members of other political parties,
would provide him (and future Presidents) with a list of potential
nominees for each FEC appointment, from which he would select a
nominee. This would change the longstanding practice of having FEC
nominees chosen by congressional leaders and party officials.

And that is why we will urge President Obama to exercise his
appointment authority, at the earliest opportunity, to nominate FEC
Commissioners under this new process that have a demonstrated
commitment to effective, non-partisan administration and enforcement of
the campaign finance laws.

The letter concludes:

The path to solving the larger problems with the FEC does
not lie in a rulemaking about how to craft procedural protections for
respondents in enforcement matters. It requires fundamental changes in
the structure and powers of the FEC, and in the process for selecting
Commissioners to serve on the agency.

It is essential for the nation to have an enforcement agency committed
to properly interpreting and effectively enforcing the nation's
campaign finance laws, as written by Congress and as interpreted by the
courts. In order to accomplish this goal, we will work with the Obama
Administration and Congress to establish a new approach for nominating
Commissioners to the agency and to achieve fundamental statutory
reforms of the FEC.