Political committees operating in a gray area of the law spent more than $430 million during the past three years to influence elections and policy debates across the country, according to an analysis by the Center for Public Integrity. Until now, no one has put a dollar amount to these groups' collective impact on the electoral process. The Center analysis is the first to present a comprehensive view of the activity of these committees, known as 527 organizations after the portion of the Internal Revenue Code that defines their tax status. These groups take advantage of a provision in the tax code that allows 527 committees to claim tax-exempt status as a political organization and at the same time avoid regulation under state or federal election law. Due to their unique legal status, 527 committees are almost totally free from fund-raising restrictions while still being able to engage in just about any election-related activity short of contributing to federal candidates. They can, for example, promote issues through advertisements, participate in voter drives and conduct political research. Experts say this makes 527 committees ideal conduits for the millions of dollars in "soft money" unregulated and unlimited contributions by individuals, corporations and unionsthat Congress banned last year.
