Defend Oregon reports that Measure 64 could lead to a loss in funding or severe penalties for Oregon charities. Measure 64 on the ballot in the November general election would prohibit public employees from using voluntary payroll deductions to donate to nonprofits, charities, unions, and other organizations of their choice.

It prohibits money collected with the use of public resources from being used for political purposes, except elections, official voter pamphlets and most lobbying. "Political purpose" is defined as: candidates, political committee or party, initiative or referendum committee, and supporting/opposing candidates or ballot measures (including signature gathering for petitions ).

A new group the American Issues Project (AIP) has been caught in controversy over an ad linking candidate Senator Barack Obama (D-IL) to former domestic terrorist William Ayers. As a 501(c)(4) organization it is allowed to air a political ad as long as the majority of its spending is nonpolitical, it cannot accept money from corporations, and it must identify the donors that finance its ads in reports to the Federal Election Commission (FEC). The ad however, is being considered by some to be a violation of election law.

The ad "Know Enough" has images of Obama and Ayers, with a narrator asking, "Why would Barack Obama be friends with someone who bombed the Capitol and is proud of it? Do you know enough to elect Barack Obama?"

Those who are calling the ad illegal consider it to clearly be express advocacy; the ad concerns an election, takes a position on the character and fitness for office of the candidate, and raises no legislative issue. The Ayers ad mentions Obama's name and uses the word "elect." According to the Supreme Court decision in FEC v. Wisconsin Right to Life, an ad can be regulated and considered express advocacy "only if the ad is susceptible of no reasonable interpretation other than as an appeal to vote for or against a specific candidate."

In response, Obama's general counsel wrote letters to television stations, asserting that the Ayers ad is illegal and false, and that its airing is subject to a FEC penalty. The letter states that Obama never called Ayers "respectable" and "mainstream." In addition a letter was sent to the Department of Justice (DOJ) requesting an investigation into the group's activities for possible violations of campaign finance law.

According to a Politico story, a spokesman for AIP Christian Pinkston said, "This is a sad ploy to circumvent the First Amendment by a campaign who has no arguments with the merits of our ad. It's the classic maneuver: If you can't win on the merits, file a lawsuit."

AIP submitted an independent expenditure report that indicates the group is spending nearly $3 million on television ads attacking Obama.

Press coverage of the Democratic National Convention spotlights the convention parties in light of the new lobbying and ethics law, and it will likely be the same during the Republican convention. Many are quick to criticize and declare that in regards to the conventions, the new ethics rules were a failed attempt to weaken the connection between lawmakers and lobbyists, and were merely superficial changes.

The House Ethics Committee for example decided that events honoring a group of members such as a particular caucus or state delegation were allowable. The new law also has an exemption for events that benefit a charity. So the proceeds of the Poker Players Alliance tournament will benefit Paralyzed Veterans of America.

According to CQ ($$), groups are on the look out for convention parties that violate the new ethics rules. "Lobbyists beware: Watchdog groups are making the rounds to monitor convention-goers' compliance with new ethics rules and call attention to events where corporate sponsors wine and dine members of Congress and their aides."

The Sunlight Foundation has launched its "Party Time" project that will track parties at the Democratic and Republican National Conventions and fund raising activities by all lawmakers. The Sunlight Foundation also released a list of 400 parties and other functions scheduled for the two party conventions.

And Public Citizen has released a report finding that corporate donors and lobbyists have contributed more than $112 million toward the national conventions. "This flood of unlimited soft money from special interests, and the lavish parties and wining and dining it pays for at the conventions, runs counter to the federal election law and congressional ethics rules."

However, an editorial in the Washington Post is a bit more pragmatic; "the new lobbying law has meant a decided change for the better in the nature of convention partying." It would be unrealistic to think that the ethics law that was put in place last year would completely end such activities. "But the new rules have brought with them a new and welcome caution for those on both sides of the partying transaction. The era of big gift bags is over."

The Alliance for Justice has released a new fact sheet, 501(c)(3)s at National Party Conventions.

The American Civil Liberties Union of North Carolina Legal Foundation (ACLU-NCLF) filed a lawsuit yesterday against the North Carolina Board of Elections due to the Board of Elections policy banning lobbyist from contributing any money to candidates for the state legislative, as well as many other state candidates, during the year in which the individual is a registered lobbyist.

The ACLU-NCLF asserts that the ban violates the first and fourteenth amendments of the U.S. Constitution, which guarantee freedom of association and free speech. According to the ACLU's press release, "[t]his year-round, zero-dollar ban applies without regard to whether the would-be recipient of the contributions is, ever has been, or will be the object" of [the individual's] lobbying efforts."

The ACLU-NCLF's Legal Director, Katy Parker, acknowledges that the State has a legitimate interest in preventing corruption and that "preventing lobbyists from wielding undue influence is a legitimate means of preserving the integrity of the electoral process. However, such restrictions must allow for the fact that everyone in America has the right to free speech and free association, especially when it comes to people expressing their political beliefs. By imposing a year-round, zero-dollar total ban, North Carolina's extreme prohibition goes far beyond what is reasonable or necessary to prevent actual or apparent corruption in government and far beyond the types of limits on lobbyists' contributions that have been upheld by any court in the United States."

A federal judge ruled that requiring groups to pledge their opposition to prostitution in order to participate in the federal government's international HIV/AIDS program continues to violate the First Amendment. This lawsuit challenges the requirement that public health groups receiving U.S. funds under the U.S. Leadership Against HIV/AIDS, Tuberculosis and Malaria Act pledge their opposition to prostitution in order to continue to receive funding.

A Brennan Center press release states; "Under this 'pledge requirement,' recipients of U.S. funds are forced to censor even their privately funded speech regarding the most effective ways to engage high-risk groups in HIV prevention. In May 2006, Judge Victor Marrero of the U.S. District Court for the Southern District of New York ruled that the requirement violates the First Amendment rights of two plaintiff organizations, Alliance for Open Society International and Pathfinder International, by restricting their privately funded speech and forcing them to adopt the government's viewpoint. Today's ruling extends that injunction to the members of InterAction, the largest alliance of U.S.-based humanitarian organizations, and to the U.S.-based members of Global Health Council, a preeminent public health membership group."

The court disagreed with the government's argument that government issued guidelines allow recipients to speak freely with their private funds. The guidelines require organizations to set up legally and physically separate affiliates, which the court ruled were too burdensome. Meanwhile, the Department of Health and Human Services is currently involved in a comment period on a final regulation which is almost identical to the guidelines the court ruled unconstitutional. In May OMB Watch submitted comments opposing these separation requirements.

The Center for Civic Policy, a 501(c)(3) organization in New Mexico, distributed a series of mailers regarding the voting records of some members of the state legislature months before the June 3 primary. After losing the primary election, three lawmakers have sued Aug. 1, asserting that the group committed fraud in the financing of campaigns against them, alleging that the group's efforts crossed the line into political activity. They also want the group to register as a political action committee to fully disclose its funders. Meanwhile, New Mexico Attorney General Gary King asserted that the activities crossed the line into campaigning and requested the Secretary of State require them to register as a political committee.

"There's an old saying that if it walks like a duck and quacks like a duck, then its probably a duck," say AG King. "And I think we know a duck when we see one."

And reportedly, the Secretary of State now agrees.

The executive director of the Center for Civic Policy Eli Il Yong Lee, stated; "Any effort to restrict this legal activity would muzzle New Mexico nonprofits from doing the very important job of keeping public officials accountable."

A Sept. 10 hearing is scheduled for the Real Truth About Obama Inc.'s (RTAO) lawsuit. RTAO is requesting that the Federal Election Commission (FEC) is prohibited from enforcing reporting requirements for independent political groups. The rules being challenged could require a group to disclose its finances, limit contributions to $5,000 per contributor and ban corporate and union money if the group is considered by the FEC to be a "political committee."

The RTAO lawsuit references a Department of Justice letter to Democracy 21 President Fred Wertheimer that said DOJ would "vigorously pursue instances where individuals knowingly and intentionally violate clear commands" of the Federal Election Campaign Act.

According to BNA Money and Politics ($$), the FEC is questioning the assignment of U.S. District Judge James Spencer, a federal judge who has ruled against campaign finance regulations in the past. A motion filed by FEC lawyers details that the plaintiffs had intentionally sought Judge Spencer's assignment to the case and suggested that the case be reassigned through a random process.

Specifically, "a case brought by the Virginia Society for Human Life (VSHL) in 2000, in which the judge ruled against an FEC regulation defining 'express advocacy' more broadly than a few 'magic words' referring to elections. [. . .] RTAO cited the VSHL matter as a 'related case,' apparently helping to ensure that. The FEC indicated that VSHL, a case decided seven years ago involving questions that have been subject to subsequent litigation and rulings by the Supreme Court, could not properly be viewed as 'related' to a new case."

BNA Money and Politics ($$) reports on some findings from the new database of lobbyist campaign contributions as required by the Honest Leadership and Open Government Act. "Lobbyists and the organizations they work for have disclosed nearly 100,000 contributions and other payments linked to members of Congress and other top officials under a new reporting system required by last year's lobbying and ethics reform law."

"Only a little more that 2,700 of the reported transactions involved 'honorary' payments, meeting expenses, and contributions to presidential library funds, which were not previously required to be disclosed. One researcher, Craig Holman of the watchdog group Public Citizen, said he has used the new database to calculate a total of $26 million just in direct campaign contributions by individual lobbyists to lawmakers over the first half of this year."

In doing a search on the House site, I found 97,662 disclosed contributions from both individual lobbyists and political action committees controlled by lobbyists or lobbying organizations, to candidates and political committees regulated under the Federal Election Campaign Act.

Attorney Kenneth Gross of the firm Skadden Arps Slate Meagher & Flom said the reports being filed under the new law are "of mild interest but contain no great revelations." Particularly interesting are the reports regarding money contributed by political action committees controlled by lobbyists and lobbying organizations, Gross suggested. Although the contributions themselves were required to be reported before, the link between this PAC money and particular lobbying interests was not necessarily known.

"The confusion over requirements did lead some organizations to report large payments honoring members of Congress, which may have been misleading." The new Senate site is here and the House site is here.

In June a federal appeals court struck down Federal Election Commission (FEC) rules dealing with coordination rules between candidates and outside groups. Reportedly, the FEC has not appealed the court decision ordering a rewrite of the rules. According to BNA Money and Politics ($$), "FEC Chairman Donald McGahn indicated at a commission meeting July 28 that the FEC could consider issuing advisory rulings on pressing issues in the run-up to the November election, including questions about permissible pre-election activity that may have been raised by the Shays III ruling. McGahn said that political parties and others may have questions about issues such as whether their plans for get-out-the-vote activities comply with the law."

A recent Watcher article addressed the possibility that FEC coordination rules on grassroots lobbying efforts may become more serious as the result of the June 13 ruling. An FEC complaint was filed seeking an investigation into an ad that featured House Speaker Nancy Pelosi (D-CA) and former Speaker Newt Gingrich. Pelosi was running for re-election in a June 3 primary and the ad aired in her district within 90 days of the primary election, and it was not paid for by Pelosi's campaign. The FEC coordination rules prohibit referencing a candidate within 90 days of a primary and 120 days of a general election. The complaint seeks an investigation into a possible case of illegal corporate contribution to Pelosi's campaign.

The Honest Leadership and Open Government Act of 2007 requires lobbyists and all lobbying organizations to file forms to the Senate and House by July 30 and Jan. 30 reporting contributions to political action committees, federal campaigns, and expenditures for events that honor officials covered by the law. A Wall Street Journal article describes some new understanding into lobbyists' contributions and other activity because of the new lobbying disclosure report, LD-203. "While many candidates decry special interests' influence in Washington, new reports show campaigns received $140 million from lobbyists in the first half of 2008." The public can search the disclosure reports in the House and Senate.

As of July 28, before the filing deadline, CQ Politics reported that "nearly $1.2 million is listed as 'honorary expenses' and another $300,000 as meeting expenses — all of it associated directly with either legislative or political events tied to lawmakers or government officials."

And CongressDaily ($$) details the confusion surrounding the new reporting requirements. "Lawyers advising clients on the LD-203 forms said guidance issued two weeks before the July 30 deadline caused a scramble to understand the changes. And lingering confusion over changes in requirements for reporting contributions by PACs and expenses at social events for lawmakers appears to have led to inconsistencies in those areas." The guidance might be revised before the next reporting deadline in January. Pam Gavin, the Senate's superintendant of documents, said; "In terms of the forms, it's as paint-by-the-numbers as you can get."