The FEC approved bundling disclosure rules yesterday, and prominent reform advocates objected immediately.  Rick Hasen predicts litigation.  First, however, we have see to the Explanation and Justification, not yet issued, which could clarify how large a disagreement there is. 

     The rules define bundled contributions, subject to disclosure, to include those contributions received and credited to the lobbyist "through records, designations, or other means of recognizing that a certain amount of money has been raised…."  What forms of credit does the rule contemplate?  The Commission defines "records" to mean "written evidence" of any kind that documents the "attribution of specific contributions to a specific lobbyist.  But it also covers "designations" or "other means of recognizing" the fundraising effort, and it ties these recognitions to "benefits" for the lobbyist, such as titles, access to events, methods of tracking contributions by fundraising source, and mementos.  The list is not exclusive.

     The reform critique is that the rules were expected by the legislation's sponsors to achieve the "broadest possible disclosure," and that this objective is far from satisfied by what the FEC has done here.  One objection is that the "means of recognizing" should not be defined with a limiting reference to "benefits."  Knowledge should be enough:  one example given, by Paul Ryan, is that the lobbyist merely informs the candidate that she raised the money, and that this is sufficient to compel disclosure.  A further complaint is that candidates are free under the rule to list multiple hosts of event for the sheer purpose of apportioning the total amount raised among them, with the result that none is credited with the $15,000 threshold for reporting.

     The rules adopted yesterday do not clearly support this reading of how event "co-hosting" could be manupulated.  The Commission's E&J will have more to say bout this, or it should, and then it will be  more certain that there is or isn't a conflict between the FEC and reform community critiques.  Predictions of litigation, at least on this issue, are premature until the Commission's position is clearer.

     The first quarrel—with the treatment of "means of recognition" to mean some form of "benefit"—seems destined to continue.  And here one is reminded that in any rulemaking, there are to choices to be made, and that both the FEC and the reform critics have reasons for their choices.  Neither should be bold enough to believe that its own is the "right" one, or the one most perfectly in line with Congressional intent.  True, the Congress urged the agency to adopt the "broadest possible disclosure":  but the reform community picks out from this phrase the word "broadest" and the agency has given more attention to "possible." 

     Here the E&J should be helpful:  there is a question here of the sense in which the FEC means "benefit."  A benefit can be understood to mean a return to the contributor, or it can be treated as concrete evidence that the candidate truly recognizes—in fact would "credit"—the lobbyist's fundraising.  The contributor who simply says that she raised money may or may not have done so:  she may have tried but failed, or she may have succeeded but has overstated her success.  Candidates (or their fundraising staff) are fairly tough-minded about such matters.  Credit is not lightly given.  And, usually, there is a benefit developed to distinguish between those who have raised the money and others who have made or faked the attempt.

     Wertheimer and Ryan seem sure that there is a more general form of "knowledge" that will provide candidates and bundlers an escape from the new rules.  The cold print of just the rules leaves them suspicious.  It leaves their questions unanswered more than it gives them the wrong answers. 

     It would not be the worst of all outcomes for the hostilities to be suspended until the E&J is published.  Then the differences can be better appreciated and they may turn out to be less dramatic than now assumed, or—and this can happen—they may be differences arrived at reasonably, each side having something to say for itself.  In time, it can be seen whether these are material differences, with actual consequences for disclosure, or whether the agency would have to do more with the benefit—yes, that word again—of experience.

Bob Bauer