Editor’s note: The Institute for Justice and the Center for Competitive Politics filed a federal lawsuit on behalf of Speechnow.org in the U.S. District Court for the District of Columbia on Feb. 14, 2008. In Speechnow.org v. Federal Election Commission, the organizations will argue that it is unconstitutional to force a group of citizens to register as a political action committee to advocate for or against a political candidate.

WASHINGTON — Federal regulators recommended yesterday that a newly formed political group cannot accept unlimited contributions from donors if it wants to advocate for or against candidates for federal office.

The draft opinion opens the way for SpeechNow.org to challenge a key provision of campaign-finance law in federal court.

SpeechNow.org was formed last year by critics of government restrictions on political advocacy. Yesterday's recommendation by lawyers for the Federal Election Commission would have to be approved or rejected by the six-member commission.

But the FEC has only two active members because the Senate has not acted on four pending nominations. Democrats have refused to confirm Hans von Spakovsky, a former Justice Department official, and Republicans want all four nominees voted on as a package.

The two remaining commissioners planned to meet tomorrow to discuss the staff recommendation, but without a quorum they will be unable to vote on it.

SpeechNow.org organized last year as a nonprofit organization, typically called a 527 for the section of the Internal Revenue Code that authorizes such groups. The groups can raise unlimited amounts of money and can conduct lobbying activities, including airing ads promoting issues. But SpeechNow.org organizers, in a test of FEC regulations, wanted to support candidates in 2008 "who favor returning America to the state of political freedom and advocate the defeat of candidates who favor speech restrictions in the name of campaign finance reform."

FEC lawyers said the group could do that only if it registered as a political committee, which would limit its contributions to $5,000 from individuals.

SpeechNow.org President David Keating said any restrictions on the ability of individuals to associate by forcing them to abide by FEC regulations would violate free-speech guarantees in the Constitution.

"We'll probably have to ask the courts to let us do it," he said.

In the past two years, the FEC found that several prominent 527 organizations, both pro-Democratic and pro-Republican, violated the law by advocating for or against candidates. Several of the groups, under agreements where they did not acknowledge wrongdoing, paid fines totaling hundreds of thousands of dollars.

Paul S. Ryan, of the Campaign Legal Center, said the draft opinion was in keeping with those past findings. The legal center supports the FEC staff proposal.

"It's really the only outcome that the commission's general counsel's office could have put forth," Ryan said.

Already this election cycle, several groups have been accepting contributions in excess of federal limits to spend money in support of candidates but have not specifically advocated for their election.

A successful court challenge by SpeechNow.org would permit groups to raise money without limits and to advocate for the election or defeat of a candidate. SpeechNow.org, however, does disclose the identities of its donors and its expenditures.