WASHINGTON, June 16 (JTA) — The Supreme Court will have the next word in an eight-year battle over the legal status of the American Israel Public Affairs Committee. The high court this week agreed to hear arguments in a case whose outcome could profoundly affect AIPAC, the pro-Israel lobby. A group of former government officials — all known as staunch opponents of Israel — have battled in vain since 1989 to convince the Federal Election Commission to regulate AIPAC as a political action committee and thereby subject it to restrictive federal campaign finance laws. Such a designation would limit contributions to — and expenditures by — AIPAC, which in spite of its name is not currently classified as a political action committee. Political action committees, commonly known as PACs, raise funds to distribute to political candidates. For its part, AIPAC, which defines itself as a registered lobby on behalf of legislation affecting U.S.-Israel relations, says it does not contribute to political campaigns. Any decision on AIPAC’s status will now wait until after the Supreme Court rules in the case. The court announced this week that it would hear oral arguments during its next term, which begins in October. A decision is expected by July 1998. Responding to the Supreme Court’s announcement Monday, AIPAC President Melvin Dow said, “We are pleased with the fact that the Supreme Court” will hear an appeal of a lower court’s ruling that the FEC misapplied the law when it ruled in AIPAC’s favor. The case stems from the campaign of six former government officials to classify AIPAC as a PAC in order to restrict the lobby’s activities and force public disclosure of its finances. The six officials include James Akins, former U.S. ambassador to Saudi Arabia, former U.S. Rep. Paul Findley (R-Ill.) and Richard Curtiss, a former official at the U.S. Information Agency and the current editor of the Washington Report on Middle East Affairs. All of these officials are known as staunch opponents of Israel and of AIPAC’s work on behalf of strong U.S.-Israel ties. Indeed, Findley blames AIPAC for his 1982 failed re-election bid. Curtiss called the court decision “good news, bad news,” because it “postpones a final decision on what we had considered a victory.” In 1992, the FEC, in response to a complaint filed by Akins and the others, found that AIPAC spent money in an effort to influence congressional elections. But the FEC, which monitors compliance with campaign laws, also ruled that this was not AIPAC’s “major purpose” and decided that the pro-Israel lobby did not have to register as a PAC. A lower court and a three-judge panel of the U.S. Court of Appeals for the District of Columbia initially upheld the FEC’s decision. At that point, AIPAC and legal observers thought the battle was over. But last December, the full U.S. Court of Appeals for the District of Columbia ruled that the FEC misapplied the law. The court said that the percentage of an organization’s work that is campaign-related should not determine the definition of a PAC. Ruling 9-2, the justices said an organization with a $100 million budget that spends $1 million on campaigns should face the same rules as a $1 million organization that spends all of its money on campaigns. When the court hears the case in the fall, the Justice Department, on behalf of the FEC, plans to argue that the appeals court decision would unduly impact free speech. Dow, the AIPAC president, said that with the case in the hands of the Supreme Court, “now there are two bases to win on.” If the Supreme Court overturns the lower court’s ruling and allows a group’s “major purpose” to determine if it is a PAC, the case against AIPAC would end. But if the court upholds the appeals court and strikes down the major purpose test, AIPAC’s fate would once again lie with the FEC. Because AIPAC is a membership organization, Dow said he is confident that the FEC would rule that the lobby is not a political action committee. Federal law grants wide latitude for membership groups to raise money and to communicate with their members on political matters and candidates’ positions. But Curtiss, too, sounded a note of confidence. Even if the case goes back to the FEC, he said, he and his colleagues would continue to pursue the case.