“I don’t think the FEC should do anything that restricts or interferes with the ability of citizens at the grass-roots level to use the Internet or support the candidates of their choice,” said Michael Toner, the Republican vice chairman of the FEC.

Specifically, the FEC is planning to examine the question of how Internet activities, when coordinated with candidates’ campaigns, fit into the definition of “public communications.” While coordinated communications are considered campaign contributions and therefore subject to strict contribution limits, current FEC regulations adopted in 2002 carve out an exemption for coordinated political communications that are transmitted over the Internet.

Last year, a federal judge challenged that provision, saying that “to allow such expenditures to be made unregulated would permit rampant circumvention of the campaign finance laws and foster corruption or the appearance of corruption.”

But Toner said there is no evidence that Congress intended to regulate the Internet when it enacted the Bipartisan Campaign Reform Act, also known as the McCain-Feingold bill.

“Congress is clearly familiar with the fact that the Internet is an increasingly important tool in politics and yet did not mention it in the McCain-Feingold law so ... I still see no evidence that Congress intended to regulate the Internet at all,” Toner remarked.

Dave Mason, another Republican who sits on the FEC, also worries that that agency may be treading “into that thicket” that will cause “almost certain damage to political freedom.”

The territory is not completely uncharted for the FEC.

In 2001, the agency issued a “notice of proposed rulemaking” on the use of the Internet in federal elections, but after collecting public comments from dozens of individuals and holding a hearing, the agency opted not to issue any new regulations. FEC officials decided the subject deserved more examination and research and that it did not have sufficient resources to tackle the tough questions related to regulating the Internet.

And interestingly, before BCRA’s enactment, the FEC did define general public political communications to include those made on “any electronic medium, including the Internet or on a Web site.”

But Mason said the agency’s “hands-off” approach to Internet activity has worked well in the post-BCRA environment.

“We don’t get complaints about it, or outraged newspaper articles,” the commissioner noted.

But this time the agency may have little choice in the matter.

Last fall, U.S. District Judge Colleen Kollar-Kotelly ruled that the agency had erred in its interpretation of several portions of BCRA, including its exemption of the Internet from coordinated communications.

“The Commission’s exclusion of Internet communications from the coordinated communications regulation severely undermines FECA’s purposes,” Kollar-Kotelly wrote in her September 2004 opinion.

Siding with Reps. Christopher Shays (R-Conn.) and Marty Meehan (D-Mass.), BCRA’s two key House sponsors, Kollar-Kotelly concluded that not regulating such expenditures would “permit rampant circumvention of the campaign finance laws and foster corruption or the appearance of corruption.”

Mason, who had wanted to appeal that part of the judge’s decision but couldn’t get enough backing from his colleagues, said he views her ruling as “very unfortunate.”

“I understand the rationale of the judge’s ruling, but I think it’s really a horrible example of regulation for its own sake that is not justified by any problem that anybody’s been able to point to in terms of abuse [or] corruption,” Mason said.

For his part, Toner is concerned about just how far any potential regulations could reach and whether a crackdown on certain Internet activities, for example, might unjustly endanger unsuspecting campaign volunteers who are active on the Web.

“If we do decide to regulate the Internet, it’s going to put on the table a lot of important issues such as what is the value of Internet activity is, particularly when it’s coordinated with candidates or political parties,” Toner explained. “And if we take the position, which I’d be very uncomfortable doing, that if an individual volunteering with a candidate consults with a candidate on his or her Internet activities, e-mails, Web sites ... are we really going to be viewing that as an in-kind contribution to the candidate? And if so, is that going to be putting people in jeopardy?”

But critics of the watchdog agency insist that the judge has done nothing more than instruct commissioners to correct a loophole in the law that will only get bigger as the political uses of the Internet expand.

“It would be completely irresponsible now for the FEC to ignore the mandate of the campaign finance laws twice after having been told by a federal district court they were wrong,” said Democracy 21 President Fred Wertheimer.

“This isn’t really an issue about the Internet,” Wertheimer added. “It’s an issue about the potential illegal coordination between a spender and a candidate regardless of where the money is being spent.”

According to Wertheimer, “there’s absolutely no rationale that says, ‘I can’t spend a million in coordination with the candidate on TV advertising, but it’s OK to make the same expenditures on Internet advertising.’”

Carol Darr, an expert on politics and the Internet, is in agreement.

As director of the Institute for Politics, Democracy & the Internet at George Washington University’s Graduate School of Political Management, Darr has closely tracked the explosion of Internet advertising in the political arena, and she sees a potential for abuse if the FEC does not act.

“The Internet does not have a monopoly on free speech, and there is no logical reason why communications that are coordinated with a candidate and which would otherwise be treated as a contribution should escape regulation simply because they occur online,” Darr said.

Not so, challenged James Bopp, a Republican lawyer who challenged the Bipartisan Campaign Reform Act on behalf of the Christian Coalition and the National Right to Life Committee.

“There’s good reason to keep your hands off the Internet,” Bopp said.

Regulating communications on the Internet makes little sense, Bopp argued, especially considering the fact that the costs of such activities are typically very low — if not entirely free — and therefore create no risk of corruption.

“Of course the FEC has approved the idea of de minimus costs, the use of corporate facilities by an employee — you can make a [photo] copy. You can pick up your phone and make a phone call,” Bopp explained. “And it always has seemed to me that the activities on the Internet are so cost-free that we’re not really talking about money influencing elections.”

Wertheimer rejected the notion that cyberspace offers cut-rate, closeout prices for campaigns.

“The idea that you barely spend anything on the Internet is an illusion when it comes to campaigns,” Wertheimer said. “There is an awful lot of money being spent on advertising on the Internet.”