Washington, D.C. - Today, Senators John McCain, Russ Feingold, Joe Lieberman and Chuck Schumer and Congressmen Christopher Shays and Marty Meehan introduced the 527 Reform Act, legislation to close the 527 loophole.

“This year, the FEC has looked the other way while 527s have played by their own rules, evading the campaign finance laws to flood the airwaves with attack ads paid for with soft money,” Meehan said.  “Thirty years of election law and Supreme Court opinion have made clear that 527s, which exist to influence federal elections, are political committees and should be regulated as such.  But the FEC has failed to enforce the law and has actually gone out of its way to open a special loophole for 527 groups.”

“This bill is part of a two-front approach to uphold the law and close the 527 loophole.  Last week, Rep. Shays and I filed suit against the FEC for failing to do its job.  This bill further clarifies existing law to guard against the FEC’s attempts to undermine it.”

Shays added: “For 30 years, the FEC has allowed 527 groups to channel soft money into federal elections, clearly violating the letter and spirit of the 1974 campaign finance law.  By bringing 527 groups working to influence federal elections under the same set of rules as every other political committee, the 527 Reform Act does the job the FEC has failed to do.”

The bill will:

• Require 527s to register as a political committee with the Federal Election Commission;
• Set a minimum allocation formula for political committees, which have both a federal and non-federal account; and
• Limit contributions by individuals to non-federal (soft money) accounts of political committees (from which the non-federal portion of allocable spending can be paid) to $25,000 per donor, per year.  Corporations and unions cannot contribute to such accounts.