The Virginian-Pilot
                             THE VIRGINIAN-PILOT 
              Copyright (c) 1996, Landmark Communications, Inc.

DATE: Thursday, August 8, 1996              TAG: 9608080388
SECTION: LOCAL                   PAGE: B3   EDITION: FINAL 
SOURCE: BY ROBERT LITTLE, STAFF WRITER 
DATELINE: RICHMOND                          LENGTH:   70 lines

ATTORNEY GENERAL ASKED TO STUDY CHRISTIAN COALITION STATUS STATE SENATOR SEEKS AN OPINION ON WHETHER THE GROUP SKIRTS VIRGINIA LAW.

As the Christian Coalition continues a legal battle with federal regulators over its ability to raise money and participate in political campaigns, some state officials are questioning whether the organization has run afoul of Virginia law as well.

At issue is whether the coalition is a state ``political committee'' that must disclose its contributors.

Attorney General James S. Gilmore III received a request Wednesday from a top General Assembly Democrat asking for an official opinion.

The request by Fairfax Sen. Joseph V. Gartlan Jr. does not name the Christian Coalition specifically, but refers to a hypothetical organization distributing voter guides and using phone banks to solicit political support.

The attorney general typically will not issue an opinion that involves a pending lawsuit. The Federal Election Commission sued the coalition last week, saying its activities amounted to in-kind political contributions.

While federal officials threaten greater restrictions - namely, limits on how much it can raise and spend on campaigns - the in-state challenge could alter the Chesapeake-based coalition's role in local and statewide political contests.

Besides using its $21-million-a-year fund-raising machine to influence presidential and congressional elections, the coalition sometimestargets state and municipal races.

In 1991, the group founded by religious broadcaster Pat Robertson distributed voter guides and phoned supporters to help defeat Sen. Moody E. ``Sonny'' Stallings Jr., who lost in an upset to now-Sen. Kenneth W. Stolle.

Critics say the boast by coalition Executive Director Ralph Reed that his organization helped defeat a state senator in Virginia Beach highlights a possible violation of state law, or at least a loophole.

``There's always a fine line between the right of free speech and the extent to which it can be regulated in a political contest,'' Gartlan said. ``The protection Virginia has in place is based on full disclosure, and from time to time, those disclosure requirements seem to be inadequate. This may be another of those times.''

A spokesman for Gilmore would not comment, except to suggest that the request from Gartlan, a left-leaning Democrat, is politically motivated. Regardless of what Gilmore concludes when he issues the opinion within the next month or two, the Christian Coalition's finances are expected to fuel debate when the General Assembly next meets in January.

Coalition officials were in San Diego Wednesday preparing for next week's Republican National Convention and could not be reached.

But the issues in Gartlan's request resemble those in the FEC lawsuit, to which coalition officials responded that their political activities are simply for educational purposes. Under federal law, organizations can conduct educational campaigns without being subject to disclosure requirements.

But Virginia law could pose a different challenge. It defines a political committee as ``any person or group of persons which receives contributions or makes expenditures for the purpose of influencing the outcome of any election.''

And while state law exempts churches and other religious organizations from disclosing contributors and spending, it does not specifically exempt groups with the Internal Revenue Service classification that the coalition carries.

The FEC lawsuit says the coalition's voter guides and telephone canvassing amount to in-kind political contributions. If the FEC prevails, the coalition could be forced to register as a political action committee, limiting its political contributions to $5,000.

That case could also affect a review by the Internal Revenue Service of the coalition's tax-exempt status. If deemed a political organization, the coalition could be asked to pay millions of dollars in current and back federal taxes.

KEYWORDS: FEC CHRISTIAN COALITION INVESTIGATION VIRGINIA LAW

by CNB