Some Troubling Omnibus Riders Removed but Two Left in Would Encourage ‘Dark Money’ Abuses: Statement of Trevor Potter, Legal Center President


The deal struck late last night on the Omnibus funding measure removed some troubling campaign finance riders that would have rolled back longstanding reforms. The current bill however includes two riders that will cement in place the ‘dark money’ status quo for the 2016 election cycle.

The first rider blocks the Securities and Exchange Commission from acting on a proposed rule to require corporations to tell shareholders how corporate money is being spent on elections-- disclosure the Citizens United decision assumed shareholders would have. Current SEC Chair Mary Jo White has refused to slot the proposed rule for action, despite receiving more than a million signatures calling for action on the proposed rule, so this rider takes the pressure off her to do anything.

The IRS rider blocks the agency from clarifying rules governing the acceptable limits of political activities of social welfare organizations. There is virtually universal agreement that the current rules are confusing and unclear, and have resulted in abuses both by dark money groups and by IRS agents in the exemption approval process. However, the IRS effort to update these rules has been bogged down in bureaucracy and plagued by partisan opposition. Now, Congress has mandated that these same inadequate rules remain untouched for another year-- the agency is not even allowed to continue working on drafting better ones.

An effect of this rider is that the door to secret foreign dollars in U.S. elections remains wide open through secret contributions to these ostensibly "nonpolitical" groups that run campaign ads without any disclosure of their donors.

On the positive side, the omnibus deal is also notable for what was not included in terms of riders pushed by some Members on campaign finance issues-- no provision to remove the coordinated spending limits for parties, no ban on an Executive Order regarding disclosure of campaign finance activities by government contractors and no provision to effectively close down the remaining structure of the presidential public financing system. All of these were apparently considered during the deliberations on the Omnibus.

It is unfortunate and a sad commentary on the grip of deep-pocketed special interests on our elections that both of the remaining riders target the kinds of disclosure that the majority of Americans strongly support and that the Supreme Court has consistently upheld and has said is important to the functioning of our democracy. These riders encourage dark money groups to seek to gain even more leverage in our political discourse and our elections.