A powerful Democratic lawyer helped craft a provision that was slipped into a year-end spending bill allowing political parties to raise huge new pools of cash — including some for legal fees that are likely going to be collected by his own firm.

Marc Elias, a partner at the Seattle-based law firm Perkins Coie, was called in to advise outgoing Senate Majority Leader Harry Reid’s aides on the campaign finance proposal on Tuesday, as they negotiated it with representatives from House Speaker John Boehner’s office, multiple sources confirm.


The provision was then added to a massive $1.1 trillion funding bill hours before it was introduced Tuesday night. The question of who was behind this major campaign finance deal had been the source of intense speculation in Washington over the past few days, but nobody has been willing to take credit for it.

The change has the potential to halt or at least slow the erosion of power of the political parties, since it would increase the maximum amount of cash that rich donors may give to the national Democratic and Republican party committees each year from $97,400 to $777,600 or more.

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While the increased limits stand to benefit both parties, they open Democrats in particular to charges of hypocrisy, since they made a major election-year issue of the GOP’s reliance on huge checks from super-rich donors like the billionaire brothers Charles and David Koch.

Many Democrats — including President Barack Obama and House Minority Leader Nancy Pelosi — objected to the rider as expanding the role of big money in politics.

POLITICO revealed Thursday that the provision was hammered out between Reid’s office and Boehner’s, but sources offered new details on Friday.

A senior Democratic congressional aide told POLITICO that Reid’s chief of staff, David Krone, oversaw the negotiations for Reid’s team, but that the office called in Elias as an adviser “to try to get our side something as well.” Elias, who represents the senator and his leadership PAC, was tasked with figuring out: “If Republicans want limit increases, how could we structure that provision to help some of our priorities?”

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Representative from the offices of Reid and Boehner declined to comment, as did Elias and Krone.

Elias’ firm could benefit from a section of the new provision that codifies a new fund with higher contribution limits for legal and other fees within the Democratic National Committee, the Democratic Congressional Campaign Committee and the Democratic Senatorial Campaign Committee. Perkins Coie represents all three committees. It helps them — and many of their candidates — navigate complicated federal and state election and tax laws, which is lucrative work. The firm has been paid more than $40 million in legal fees by federally registered political committees since 2000, the earliest date for which there are easily searchable electronic records. That includes about $10 million from the DNC and DCCC. The DSCC has paid the firm millions more, but the precise amount cannot be easily determined, since the committee does not file reports in electronic format.

Jason Torchinsky — a lawyer whose firm represents the RNC, but which sources say was not involved in negotiating the rider — was not surprised when told that Elias played a major role.

“If the Democrats are doing something on campaign finance, Marc is likely to be in the middle of it,” he said of Elias.

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The quick-talking, Twitter-savvy 45-year old New York native — who is well-liked on both sides of the election law bar and is a regular presence at Federal Election Commission meetings — is a dominant force in U.S. election law.

In addition to pioneering new big money terrain (he filed the FEC request that led to the creation of super PACs), Elias has developed niches in redistricting fights and postelection litigation. He emerged as a star of the dramatic eight-month-long recount battle following Minnesota’s 2008 Senate race. It ended with his client, Democrat Al Franken, unseating former Republican Sen. Norm Coleman, and Elias earning Reid’s appreciation.

Perkins Coie’s political law practice, anchored by Elias and former White House Counsel Bob Bauer, has something of a stranglehold on the Democratic Party’s election law business, representing not only the party committees themselves but everyone from Reid (whose various committees have paid $317,000 in legal fees to Perkins Coie over the years) to Obama ($7.4 million) to the major Democratic super PACs ($19 million).

Yet Elias’ role in this week’s drama seemed to put his party clients in something of an awkward position.

Representatives of the DNC, DCCC and DSCC denied pushing for the increased limits and said Elias was not working on their behalf.

“We didn’t know about it,” said a DNC official. “ No one did it on our behalf. And it was a surprise for us when the news broke.”

DSCC spokesman Justin Barasky said, of Elias and the rider, “He is our lawyer, but he was not acting on our behalf. The DSCC was not involved with it.”

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Despite their efforts to distance themselves, all of the party committees — as well as their GOP counterparts — stand to benefit to varying extent from the changes in the rider.

In fact, one of the new provisions in the rider seems tailored to help the DSCC dig out of a financial hole. The committee finished the midterm election cycle with $20.4 million in debt, after having taken out a long-term loan in May of $5.2 million to buy a house adjacent to its Capitol Hill headquarters. The rider allows the DSCC and all the other national party committees to accept contributions of $97,400 per donor each year “to defray expenses incurred with respect to the construction, purchase, renovation, operation, and furnishing of one or more headquarters buildings” – including “to repay loans” taken out to finance them. The DSCC’s building loan fits perfectly into the time frame specified in the rider, which specifically allows the new funds to be used to pay building-related expenses “incurred during the 2-year period which ends on the date of the enactment” of the provision.

Election law experts disagree over how much flexibility the parties will have in spending the new funds created by the rider. But one of the other new funds authorized by the rider is for legal proceedings of the sort handled by attorneys both in the party committees’ relatively small in-house legal shops and at the outside firms like Perkins Coie.

Under the rider, each party committee — the DNC, DSCC, DCCC and the Republican National Committee, National Republican Senatorial Committee and National Republican Congressional Committee — will be able to accept annual donations of as much as $97,400 per donor per committee to pay for legal costs. The rider’s exact description of how the cash can be used is “to defray expenses incurred with respect to the preparation for and the conduct of election recounts and contests and other legal proceedings.”

Regardless of the precise language, the legal fund is going to be a bonanza for the party’s election lawyers, predicted Craig Holman, a lobbyist for Public Citizen, which advocates stricter campaign finance rules and opposed the rider.

“That particular account really drives home the point of how self-serving this is, because it is billed as financing recounts, but then it adds other legal expenses, which means it can be used for anything,” he asserted.

In addition to the legal fund and the building fund, the rider includes an account set up by the DNC and RNC to fund their presidential nominating conventions.

The FEC had recently cleared the DNC and the RNC to create stand-alone committees to finance their conventions, public funding of which Congress ended this year. Elias’ partner Bauer represented the DNC before the FEC in making the request. And the independent agency had previously authorized separate contributions to recount committees.

But the Reid-Boehner deal would both increase the maximum donation that can be accept for those purposes and codify the funds into law.

Holman said the rider creates more opportunity for aggressive lawyers, a category in which Elias is a leading practitioner, to find creative ways for their clients to spend the new cash — and accrue billable hours while they’re at it.

“They can consider this just desserts for having brought in all this new money,” said Holman, asserting, “there are all kinds of open windows for further mischief in this.” He pointed to the days before the 2002 McCain-Feingold law banned unlimited so-called “soft money” contributions to the parties, when that cash was legally supposed to be used exclusively for “party building activities,” but the parties found ways to use it for TV ads that, to most viewers, seemed like plain old campaign ads.

Reid — who waged a midterm war against the Kochs and big money in politics generally and even called a Senate floor vote on a long-shot constitutional amendment to limit its flow — has lost credibility on the issue, Holman said.

“This is absolute hypocrisy on the part of Harry Reid. Harry Reid was the person who championed getting a floor vote on the alamendment. And then, after that apparently didn’t get the results that he wanted in the 2014 election, he turned around and joined the money bandwagon,” said Holman, dismissing Democratic efforts to blame Republicans for the change.

“The Democratic Party — especially the lawyers for the Democratic Party — were half the team driving this,” he said.