Earlier this week, the three Republican members of the Federal Election Commission (FEC) released a statement of reasons explaining their votes in May to dismiss a case against a no longer active 501(c)(4) group, Freedom's Watch. The Washington Independent says that the material released "bodes particularly ill for the chances of any form of meaningful campaign finance disclosure from independent groups during the upcoming election cycle."

After a 2008 ad titled "Family Taxes," the Democratic Congressional Campaign Committee (DCCC) filed a complaint charging that the group violated FEC rules by failing to report the donors who paid for the ad. The Republican commissioners interpreted the disclosure rules to require information about donations "only if such donations are made for the purpose of furthering" a specific ad.

The statement of reasons says, "there is no specific evidence to contradict the assertion of Freedom's Watch that all funds contributed during 2008 were for general purposes." However, if a group primarily engages in producing electioneering communications, wouldn't donations likely go towards producing the ads? As opponents of the DISCLOSE Act have argued, existing disclosure requirements are adequate to reveal who is funding campaign ads. However such rules, as demonstrated with this case, can easily be avoided.

According to BNA Money and Politics ($$), their "statement is relevant to ongoing questions about when groups funding ads or other campaign spending must disclose donors. Despite recent requests by FEC staff that some of these groups provide information about their donors, the GOP commissioners' statement indicates they would vote to require disclosure only when it can be demonstrated that a specific donation was linked to a specific ad."

The House Financial Services Committee approved the Shareholder Protection Act, H.R. 4790. The bill requires shareholder approval of a corporation's political spending for federal races. The Securities and Exchange Commission would have to issue rules requiring corporations to disclose any materials for political activities created with or purchased using company money. The bill was introduced by Rep. Michael Capuano (D-MA) in March, and is another effort by House Democrats to try and mitigate the effects of the Citizens United decision.

According to CQ, the "bill would allow shareholders to vote on the total amount of proposed political expenditures for that fiscal year. It would require corporations to include in its bylaws a requirement for a shareholder vote on political expenditures in excess of $50,000 or any expenditure that would make the total amount spent by the corporation more than $50,000. A majority vote would be required for approval."

The legislation is strongly opposed by the U.S. Chamber of Commerce, which sent a letter to the committee urging their rejection of the bill, as "an assault on First Amendment rights."

BNA Money and Politics ($$) reports that Financial Services Chairman Barney Frank (D-MA) said during mark up that the bill, "simply clarifies that the right actually belongs to a corporation's owners, i.e., its shareholders. In Frank's view, the bill and the court's [Citizens United] decision work hand-in-hand." Frank asserted it, "would simply require companies to add an additional item to their annual proxy materials and, as such, would not impose new costs."

An amendment offered by Rep. Michael Castle (R-DE) would have allowed states to opt out of compliance. The majority of large U.S. companies are incorporated in Delaware. The amendment did not pass. Rep. Jeb Hensarling (R-TX) proposed another failed amendment, which would have prohibited the bill from taking effect until Congress enacts another bill he sponsors, H.R. 5860. Hensarling's bill, the Union Member Protection Act, would require labor unions to obtain approval for political expenditures and disclose those activities to its members.

The Shareholder Protection Act now moves to the full House, and may be considered in September. The Senate is unlikely to act.

Reportedly, the American League of Lobbyists is working with the Sunlight Foundation to change the Lobbying Disclosure Act (LDA). Once again Tom Daschle is the poster child for why such reform is needed. "Daschle, working with his firm's lobbyists, uses his decades of congressional experience to tell clients how to favorably influence policy. But Daschle insists, 'I do not lobby.'" Dave Wenhold, president of the American League of Lobbyists said, "I don’t care if you call it a rainmaker or a strategic adviser, if you're talking to a lawmaker about any issue or anything you’re lobbying."

The LDA requires registration if more than one lobbying contact is made, more than 20 percent of one's time is spent lobbying and have more than $11,500 in expenses or $3,000 in income from lobbying per quarter. POLITICO reports that the Sunlight Foundation "is proposing to eliminate the 20 percent rule and to lower the thresholds to $5,000 in expenses or $2,500 in income per quarter."

The article identified about a half-dozen people who are not registered, but "whose job descriptions put them in the heart of D.C.’s influence business."

Senator Chuck Schumer (D-NY) introduced a revised version of the DISCLOSE Act (S. 3628) on July 21, in hopes of gaining some much needed support from moderate Republicans before the upcoming August recess.

The new bill includes changes to address concerns that the bill favored unions. For example, a provision in the House passed version exempted unions from disclosing the transfer of money between affiliates. The revised bill removes this, and also keeps a controversial carve-out for large, 501(c)(4) membership groups. The changes have reportedly created concerns with the AFL-CIO. According to POLITICO, an AFL-CIO spokesman said, "We continue to review the legislation and fight to ensure that the final bill addresses the tilted advantage that big business has enjoyed for far too long."

Another change would only require groups to state their geographic locations in television ad disclaimers and not radio ads because television ads could do so visually.

Senate Majority Leader Reid filed cloture late Thursday night on a motion to proceed to the bill. However, it remains uncertain whether the bill will have the 60 votes needed to overcome a possible Republican filibuster. A vote on whether to proceed with the DISCLOSE Act is expected on Monday, July 26.