Bush team forms tax-exempt organization to fund transition

Both sides raise millions to defray legal expenses

From Brooks Jackson/CNN

WASHINGTON (CNN) -- Texas Gov. George W. Bush's campaign team has officially formed an organization, the Bush-Cheney Presidential Transition Foundation Inc., to raise private funds for a presidential transition.

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Bush spokesman Ari Fleischer said the group will seek approval from the Internal Revenue Service for tax-exempt status under section 501(c)4 of the tax code, a status that does not give donors a tax deduction for their gifts. Incorporation papers were filed in Texas on Monday night.

GOP vice presidential running mate Dick Cheney said the Clinton-Gore ticket used the same type of non-profit corporation in 1992. The Clinton transition fund raised $5.3 million in private donations, according to a spokeswoman for the General Services Administration.

The Presidential Transition Act of 1963 allows private gifts from individuals and organizations -- including corporations -- which are subject to a limit of $5,000 per donor. There is no limit on the value of in-kind gifts -- donations of goods or services, such as office space or loaned automobiles.

But Cheney said Monday that the Bush team won't take corporate donations of any kind. Officials said the GOP team also won't take any in-kind gifts from individuals that would put an individual over the $5,000 limit.

Federal law requires full public disclosure of the private donations, excluding in-kind donations, to be filed with the General Services Administration 30 days after the inauguration, according to a GSA spokeswoman. The Bush team has promised prompt disclosure, posting all donations on a transition team Web site, currently in the works.

Both camps raise millions for legal challenges

Bush aides said they have now raised a total of $6 million to help pay for legal costs surrounding the Florida ballot dispute. Bush is making voluntary disclosure on his campaign Web site, but donations listed there as of Tuesday totaled only $3 million, and the most recent donation was dated November 20.

Gore officials have acknowledged raising about $3 million. The vice president's camp intends to make full disclosure of all receipts and expenditures over $200 -- the same standard used by the Federal Election Commission.

The Gore team chose to register its recount fund under section 527 of the tax code, a status that requires public disclosure through the IRS. The first report, due December 7, could include some very large gifts, as Gore has not limited the size of recount donations he will accept. There's no limit under federal law.

As of Tuesday, Gore had not set up any official transition organization or raised any money to finance a transition, according to spokesman Doug Hattaway.