Democratic Party cleared in interstate donations

The Hawaii GOP claimed gifts were traded to bypass limits

The Democratic Party in Hawaii, Maine and Massachusetts did not break federal campaign contribution laws when they gave money to a Rhode Island U.S. Senate candidate in last year's election, according to a Federal Election Commission ruling.

The Democratic Party in the three states funneled a total of $25,000 beginning in December 2005 to Rhode Island Secretary of State Matt Brown, who was seeking the Democratic Senate nomination.

Over the next few weeks, three of Brown's top donors contributed a total of $28,000 back to the out-of-state parties that had made the donations to Brown's campaign. In each case the donor had already given Brown the maximum allowed under federal law, $4,200.

Those transactions led to a complaint by the Hawaii Republican Party alleging that Brown's campaign broke campaign finance laws by routing money through state parties to avoid contribution limits.

"Though it may be reasonable to infer that the individual donors solicited by Brown gave to the state parties under the assumption that some portion of their contribution might then be donated to the Brown Committee, such an inference alone is insufficient," according to the Federal Election Commission's decision, which was dated April 4 but not publicly announced.

The commission wrote that there was no evidence of an explicit arrangement between the state parties and the Brown campaign for a money swap that would skirt election laws.

"We made our case, and we still believe that what the Democratic Party of Hawaii did was wrong," said Hawaii Republican Party Chairman Sam Aiona.

The matter had little apparent impact on the 2006 election in Hawaii, where Democrats retained 80 percent control of both legislative houses and swept U.S. House and Senate elections. Although incumbent Gov. Linda Lingle won decisively, Democrats did no worse than expected in any race.

In Rhode Island, Brown later dropped out of the race because he lacked enough money to continue his campaign. Sheldon Whitehouse went on to win the Democratic primary and defeated incumbent Republican Lincoln Chafee in the general election.

The controversy contributed to the resignation of Maine Democratic Party Chairman Patrick Colwell, who stepped down on the same day his state party adopted new rules preventing future out-of-state donations.

The Hawaii Democratic Party also banned out-of-state donations as a result, said Chairman Mike McCartney.

"I'm happy that it's over, and we just have to move ahead," McCartney said.