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Thursday, Feb. 12, 2004

Among the largest recipients are new groups such as America Coming Together and MoveOn.org Voter Fund, which want to help win the White House for Democrats, and Republican State Leadership Committee, which is focusing on state and local races.

Such tax-exempt political groups began cropping up in larger numbers after a law enacted by Congress in 2002 banned political parties from accepting soft money as they had for two decades.

Their biggest donors include people and companies who used to write huge checks to political parties.

Democrat giver and billionaire financier George Soros gave ACT $5 million. Hollywood producer Steve Bing gave millions to the Democratic Party in 2002; last year he donated nearly $1 million to MoveOn.org and $2 million to be split between ACT and a like-minded group. Citigroup gave $65,000 to Republican State Leadership Committee, along with $217,580 to Republican Governors Association and $100,000 to its Democrat counterpart.

The law, upheld by the Supreme Court in December, left such tax-exempt groups as the primary repository for big political donations from companies and unions.

"The soft money, your corporate and labor union money that used to be going to the national parties, is now starting to crop up in these nonparty groups," said Kent Cooper, co-founder of Political Money Line. The nonpartisan campaign finance tracking service compiled the total by reviewing the tax-exempt political groups' IRS filings.

Democrats Undermine the 'Reform' They Demanded

So far, most groups have been started by Democrat activists, whose party was more reliant on soft money than the GOP. The Republican Party for years collected millions of dollars more in the limited "hard money" donations from individuals the parties can still raise. That advantage has continued this election cycle.

The law also broadly bans outside groups such as the tax-exempts from using soft money for federal elections. But exactly what that means is under debate. The Federal Election Commission is expected to issue its first key opinion on the issue next week.

Several of the top 10 soft-money-raising groups last year are liberal groups that have said their top priority is helping elect a Democrat president in 2004.

One of them, America Coming Together, raised $12.51 million, second only to Republican Governors Association's $12.53 million in soft money.

ACT is focused on get-out-the-vote activities and is raising soft money and the limited hard money.

Which Definition of 'Progress'?

ACT attorney Laurence E. Gold said that it planned to pay for its activities with a mix of soft and hard money and that the FEC has long allowed such groups to do so. Its purpose is winning "election of progressive candidates at all levels of government," not just defeating President Bush, Gold said.

Other top soft-money raisers last year include Democratic Governors' Association, with $9.3 million; the Democrat-leaning American Federation of State, County and Municipal Employees Special Account, $6.2 million; the pro-DemocratMoveOn.org Voter Fund, $4.8 million; and Republican State Leadership Committee, $3.7 million.

In the 2001-02 election season, before the new law took effect, "527" groups raised more than $200 million. At that time, many of the multimillion-dollar groups were started by members of Congress to raise funds for fellow party members; the lawmakers are now banned from raising soft money.

Cooper said that despite the $102 million tally so far, the political groups hadn't reached their full soft-money-raising potential. He believes uncertainty about the law's fate during the more than yearlong court fight and jockeying among new groups to become the go-to organization for big donors have slowed their activities.

© 2004 Associated Press. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.

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