AUSTIN - Federal Election Commission audit documents released Thursday indicate U.S. Rep. Tom DeLay's national leadership committee pushed the limits of federal law in 2002 by spending almost $100,000 in corporate money to affect the outcome of five congressional races.

Meanwhile in Texas, Travis County prosecutors subpoenaed telephone records for DeLay's home, mobile phone and campaign office from Sept. 1 to Dec. 31, 2002.

District Attorney Ronnie Earle also sought telephone records for DeLay's daughter, Dani DeLay Ferro, who served as a fundraiser for both DeLay's national Americans for a Republican Majority, ARMPAC, and the DeLay-founded Texans for a Republican Majority, TRMPAC.

DeLay, R-Sugar Land, is under indictment in Texas on charges related to spending corporate money to affect the outcome of seven state House races in 2002. DeLay has said the prosecution is politically motivated.

ARMPAC's citation
ARMPAC was cited for reporting violations by the FEC in August in an audit indicating the committee may have spent more than $200,000 in restricted corporate money in 2001 and 2002 on federal political activities.

The audit made no recommendations on whether the FEC should pursue an enforcement action against ARMPAC.

Records from the audit were made public Thursday by Political Money Line, a tracking service, showing ARMPAC paid $96,551 in restricted corporate money to Federal Capital Communications Corp. on Nov. 7, 2002, to pay for 145,348 direct mail pieces that were sent in five congressional races. It is unclear whether the money was included in what the FEC cited as reporting problems.

The mailings were sent a week before the elections in races in Florida, Kansas, Iowa and two in Indiana. A sample of one mailing was included in the documents.

While the mail piece did not specifically advocate the election of a candidate, it praised Republican Chris Chocola of Indiana as a gun rights advocate. Chocola won the election.

Federal law forbids the use of corporate money to specifically advocate for a candidate.

But numerous political organizations got around the so-called soft money rule by using corporate money to pay for "issue advocacy" advertisements that told voters how a candidate stood on a specific issue.

Federal election law has since changed to severely limit such issue advertising, and federal courts have ruled that the FEC can look at the totality of circumstances to rule whether issue advertising was meant to affect the outcome of an election.

Political Money Line co-founder Kent Cooper said it would be up to the FEC to determine whether the ARMPAC ads violated federal law.

ARMPAC Executive Director Jim Ellis and lawyer Donald McGahn did not return calls for comment. DeLay spokeswoman Shannon Flaherty said the latest documents prove nothing.

"These items were all disclosed in compliance with federal campaign law, the transactions were legal, and this happened three years ago," she said. "This is just a flashback masked as breaking news."

DeLay and Ellis are under indictment along with TRMPAC Executive Director John Colyandro on charges of conspiring to violate state election laws, conspiracy to money launder and money laundering in relation to how $190,000 in corporate money was spent in 2002 Texas House elections.

Today's hearing
Ellis and Colyandro have a hearing today before state District Judge Bob Perkins. Ellis is asking Perkins to order Earle to release a list, "if it in fact exists," of candidates that Ellis supposedly gave to a Republican National Committee official in 2002 outlining how much money state candidates should received.

The indictments say Colyandro gave Ellis a check for $190,000 in corporate money that Ellis then gave to RNC official Terry Nelson along with a list of Texas candidates who should receive national funding. Then the RNC's state elections committee gave $190,000 in non-corporate money to the seven candidates, the indictment alleges.

Ellis lawyer Mark Stevens of San Antonio said he wants to find out if prosecutors actually have such a list.

DeLay lawyer William White of Austin said Earle was just trying to make news by issuing the telephone subpoenaes after the grand jury has concluded a three-year investigation.

"It's something they should have done three years ago," White said.

DeLay's lawyers have accused Earle of misconduct by taking the case to three separate grand juries to get the indictments. DeLay's lead attorney, Dick DeGuerin of Houston, issued a subpoena on Wednesday to compel Earle to testify about the grand jury activities.

Chronicle reporter Michael Hedges contributed to this report from Washington, D.C.

r.g.ratcliffe@chron.com

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