In addition to making contributions, party committees may support federal candidates in the ways described below.

In general, candidate-support activities must be paid with federally permissible funds.

A national party committee and state party committees may make special expenditures in connection with the general election campaigns of federal candidates. 109.30. These coordinated party expenditures do not count against the contribution limits but are subject to a different set of limits, as explained below. Also, coordinated party expenditures must be made with federally permissible funds only.

(Coordinated party expenditures are also called “441a(d) expenditures” because they are provided for in Section 441a(d) of the Federal Election Campaign Act.)

Committees Authorized to Make Coordinated Party Expenditures

National Committee

Only a national party committee has a coordinated party spending limit for the party’s Presidential nominee. 109.32(a).

A national party committee also has a coordinated party expenditure limit for the party’s House and Senate candidates in the general election. 109.32(b).

State Committee

A state party committee has its own separate spending limit for each of the party’s House and Senate nominees in that state. 109.32(b).

Local Committees

A local party committee or organization may make coordinated party expenditures if authorized to do so by the national or state committee. Local party units do not have any coordinated party spending authority of their own.

Assigning Spending Limits
to Designated Agent

General Rule

A national or state party committee may assign all or part of its coordinated party spending authority to another party committee. 109.33. The assigning committee must first authorize the spending in a written agreement that should specify the amount the designated agent may spend.

In this way, for example:

• State and local party committees may spend against the national committee’s Presidential spending limit; and

• A local party committee may spend against the state committee’s limits for House and Senate candidates.

Authorizing Committee’s Responsibility

A state party committee must monitor and disclose party expenditures made by designated local committees. A state committee may use an FEC-recommended plan for this purpose (see here) or some other method approved in advance by the Commission. 109.33(b).

National party committees should also monitor and disclose coordinated party expenditures made by designated agents.

Formulas for Coordinated Party Expenditure Limits

Coordinated party expenditure limits are calculated as follows:

• House Candidate:[1] $10,000 increased by the Cost of Living Adjustment (COLA)[2] or, in states with only one representative, the same as the Senate limit.

• Senate Candidate: state voting age population x 2 cents, increased by the COLA; or $20,000 increased by the COLA, whichever is greater.

• Presidential Candidate: National voting age population x 2 cents, increased by the COLA. 109.32

Every election year, the Commission publishes the dollar amounts of the coordinated party expenditure limits in its newsletter, the Record.

The Millionaires Amendment

The coordinated party expenditure limits for House and Senate candidates increase when their opponents’ personal spending exceeds certain threshold amounts. See below.

Party Expenditures vs. In-Kind Contributions

In making a coordinated party expenditure, the party committee pays for goods or services to benefit the candidate but does not give the money directly to the candidate or candidate committee. For example, the payment of a campaign bill could be treated and reported as a coordinated party expenditure, while a check payable to the candidate committee could not—it would have to be treated as a contribution.

Similarities

Coordinated party expenditures, then, are similar to in-kind contributions in that both represent payments for goods or services. An expenditure in connection with a general election campaign may count against either the coordinated party expenditure limit or the contribution limit  for the candidate. It is up to the party committee to decide (assuming it has authority to make a coordinated party expenditure).

Differences

Coordinated party expenditures differ from contributions in the following ways:

• Coordinated party expenditures may be made in connection with the general election only, whereas contributions may be made in connection with any election.

• Coordinated party expenditures count against special limits, distinct from the contribution limits.

• There is only one coordinated party expenditure limit per candidate (it applies only to the general election candidate)[3] whereas there is a separate contribution limit for each election in which a candidate participates.

• The coordinated party expenditure limits are much larger than the contribution limits.

• Coordinated party expenditures are reported by the party committee only, while contributions are reported by both the party committee and the recipient candidate committee.

Communications

Coordination

If a communication is coordinated with a candidate, then it is either an in-kind contribution to that campaign or it is a coordinated party expenditure. A communication is coordinated if it satisfies a three prong test. For more on determining coordination, see here.

Disclaimers

Disclaimers on communications done as coordinated party expenditures must identify the committee that actually paid for the communication, regardless of whether the committee is spending against its own limit or against an amount assigned to it by another committee. 110.11(d)(1)(i).

When a coordinated party expenditure is made before the date of the party’s nomination, the communication need only state who paid for it; no authorization statement is required. 110.11(d)(1). However, for post-nomination coordinated party expenditures approved by a candidate or candidate’s committee, the communication must state also that it is authorized by the nominee or nominee’s committee. 110.11(d)(2). These post-nomination coordinated party expenditures must also comply with the additional disclaimer requirements explained here.

For more on candidate appearances in their communications, see the Campaign Guide for Congressional Candidates.

Allocation Among Candidates

A coordinated party expenditure made on behalf of more than one candidate must be allocated in proportion to the benefit each candidate is expected to receive. The amount allocated to a candidate counts against the coordinated spending limit (or contribution limit) for that candidate. Allocation procedures are the same as those used to allocate in-kind contributions; see page 13. 104.10(a); 106.1(a) and (b).

Pre-nomination expenditures

Party committees may make coordinated party expenditures in connection with the general election campaign before or after the party’s candidate has been nominated. All pre-nomination coordinated expenditures continue to be subject to the coordinated party expenditure limitations, whether or not the candidate on whose behalf they are made receives the party’s nomination. 109.34.

 

Under provisions of the so-called “Millionaire’s Amendment,” the coordinated party expenditure limit applicable to a candidate may be increased if personal spending by one or more opposing candidates creates a funding dispartity that exceeds certain threshold amounts.

Threshold Amounts

The threshold amounts for House and Senate candidates differ. For House candidates the threshold amount is $350,000. Senate candidates must exceed ten times the threshold amount set forth in FEC regulations ($150,000 + (.04 x voting age population of the state)) to trigger increased 441(a)(d) limits. These figures are available on the FEC’s web site here.

Opposition Personal Funds Amount     

Opposition personal spending that exceeds the threshold amounts does not by itself trigger increased limits. The regulations also take into account expenditures from the personal funds of the candidate seeking increased limits under the Millionaires’ Amendment as well as fundraising by the campaigns.

Campaigns must use the appropriate “opposition personal funds amount” formula to determine whether an opposing candidate has spent sufficient personal funds in comparison to the amounts raised by the campaigns to trigger increased contribution and coordinated party expenditure limits. The opposition personal funds formula takes half the difference between the gross receipts of the candidate and the gross receipts of the opponent and subtracts that from the amount by which the opponent is outspending the candidate using his or her personal funds.[4]  Hence, a candidate with a significant fundraising advantage over a self-financed opponent might not receive an increased contribution limit or 441a(d) limit.

Avoiding Excessive Expenditures Under the Increased Limits

National and state party committees must monitor the opposition personal funds amount for campaigns in which they are making coordinated party expenditures in excess of the regular coordinated party expenditure limits (at 11 CFR 109.32(b)).

House candidates (and their authorized committees) must not accept, and national and state party committees making coordinated party expenditures on behalf of House candidates must not make, any contribution or coordinated party expenditure that causes the aggregate contributions accepted and coordinated party expenditures made under the increased limits to be greater than 100 percent of the opposition personal funds amount.

Similarly, Senate candidates (and their authorized committees) must not accept, and national and state party committees making coordinated party expenditures on behalf of Senate candidates must not make, any contribution or coordinated party expenditure that causes the aggregate contributions accepted and coordinated party expenditures made under the increased limits to be greater than 110 percent of the opposition personal funds amount.

Candidate Reporting Requirements

Notification of Personal Spending

A House candidate’s principal campaign committee must notify the Commission, each opposing candidate and the national party committee of each opposing candidate within 24 hours when the candidate’s aggregate expenditures from personal funds exceed the threshold amount (FEC Form 10). 11 CFR 400.21(b).

A Senate candidate’s principal campaign committee must notify the Secretary of the Senate, the Commission and each opposing candidate within 24 hours when the candidate’s aggregate expenditures from personal funds exceed two times the threshold amount (FEC Form 10). 11 CFR 400.21(a).

After the initial notification, House and Senate candidates must inform the same group within 24 hours each time the candidate makes an additional expenditure from personal funds in excess of $10,000. 11 CFR 400.22.  Both the initial and additional notifications must be made by faxing or e-mailing a copy of FEC Form 10 to all of the designated entities. 11 CFR 400.24.

Notification of Eligibility for Increased Limits

Within 24 hours after they become eligible, candidates who qualify for increased coordinated party expenditure limits (or their principal campaign committees) must file FEC Form 11 to inform their national and State party committees and the Commission.

Within 24 hours of attaining funds comparable to that of the wealthy opponent – 100 percent of opposition personal funds for House candidates and 110 percent for Senate candidates – the candidate must file FEC Form 12 and inform the national and state committees of his or her political party that the increased limits have been suspended.

Party Committee Reporting Requirements

Each time a national or state political party committee makes coordinated expenditures in excess of the normal limits, it must notify the Commission and the candidate on whose behalf the expenditure is made by fax or e-mail within 24 hours, using Schedule F. A check-off box on Schedule F indicates that it is a 24 hour report made under modified limits. 11 CFR §400.30(c)(2).

A national or state party committee must report this activity a second time on a Schedule F filed with its next scheduled report.

For further information on reporting coordinated party expenditures, see here.

State and local party committees may spend unlimited amounts for certain activities—called exempt party activities—that benefit federal candidates but that are exempt from the definitions of contribution and expenditure. (A national party committee is not entitled to these exemptions.)

Generally, party committees must report spending on exempt activities as operating expenditures. (Exempt party activities are not reportable by the committees of federal candidates benefiting from the activity.) In many instances, however, these activities will qualify as FEA, triggering specific payment and disclosure requirements discussed in the next chapter.

Disclaimers

Exempt state and local party activities are required to carry a “paid for by” disclaimer. Being exempt from the contribution and expenditure limits does not exempt these communications from the disclaimer requirement. However, the disclaimer does not need to state whether the communication is authorized by a candidate, or any authorized committee or agent of any candidate.  See further discussion of the disclaimer rules here. 110.11(e).

Slate Cards and Sample Ballots

A state or local party committee may prepare and distribute a slate card, sample ballot, palm card or other printed list naming candidates for any public office. The payments are not considered contributions or expenditures on behalf of any federal candidate listed, as long as the following conditions are met:

• The list names at least three candidates running for election to any public office.

• The list is not distributed through public political advertising (which includes broadcast media, newspapers, magazines and billboards but not direct mail). AO 1978–9.

• The content is limited to the identification of each candidate (pictures may be used), the office or position currently held, the office sought and party affiliation. The list must exclude any additional biographical data on candidates and their positions on issues as well as statements on party philosophy. Certain voting information, however, may be given, such as time, place and instructions on voting a straight party ticket. AO 1978–89.

• Costs allocable to federal candidates are paid with permissible funds. 100.80; 100.140. For information on how to allocate exempt activity expenses, see here.

Campaign Materials

A state or local party committee may prepare and distribute campaign materials such as pins, bumper stickers, handbills, brochures, posters and yard signs. The payments are not considered contributions or expenditures if the following conditions are met:

• The activity is conducted on behalf of the party’s nominees in the general election (not on behalf of candidates running in primary elections).

• The materials are distributed by volunteers—not through public political advertising such as television, radio, newspapers, magazines, billboards or direct mail (mailings by a commercial vendor or from commercial lists).

• The party committee does not use materials purchased by the national party committee or money transferred from the national committee to purchase materials.

• The party committee does not use funds designated for a particular federal candidate.

• A payment from a nonfederal campaign to help pay for the materials does not exceed its allocated share of the expenses.

• Costs allocable to federal candidates are paid with permissible funds. 100.87; 100.147. For information on how to allocate exempt activity expenses, see here.

Voter Drives for Presidential Nominee

A state or local party committee may conduct a voter registration or get-out-the-vote drive on behalf of the party’s Presidential and Vice Presidential nominees without the payments being considered contributions or expenditures as long as the following conditions are met:

• The activity does not involve the use of public political advertising such as television, radio, newspapers, magazines, billboards or direct mail (mailings by a commercial vendor or from commercial lists).

• Phone banks are operated by volunteers (although paid professionals may design the system, develop calling instructions and train supervisors).

• The party committee does not use funds transferred by the national party committee for voter drive activities.

• The party committee does not use funds designated for a particular federal candidate.

• Cost allocable to federal candidates are paid with permissible funds. For information on how to allocate exempt activity expenses, see here.

Any reference to a U.S. House or Senate candidate must be incidental to the overall activity; otherwise, the cost allocable to the House or Senate candidate is an in-kind contribution or coordinated party expenditure on behalf of that candidate. 100.89; 100.149; and 106.1(c)(3).

In some cases, phone banks are governed by unique allocation rules. These unique rules apply to a phone bank conducted by a national, state, district or local party committee that:

·       Refers to a clearly identified federal candidate;

·       Does not refer to any other clearly identified federal or nonfederal candidate;

·       Includes another reference that generically refers to other candidates of the federal candidate’s party without clearly identifying them (i.e., “Come out and vote for President John Doe and our great Party team.”);

·       Does not solicit any contribution or donation or any other funds from any person; and

·       Is not a contribution or expenditure. 106.8(a).

If the phone bank satisfies all of these conditions, then 50 percent is attributed to the federal candidate as an in-kind contribution or coordinated party expenditure (or must be refunded by the campaign) and must be paid for with federal funds. The remaining 50 percent is not attributed to any candidate, but must be paid for with federal funds. 106.8(b).

Contributions to Major Party Nominees

No Contributions to General Election Campaign of Publicly Funded Candidate

Major party nominees who opt to receive public funding for the general election may not accept any campaign contributions and must limit campaign spending to the amount of the public funding grant.[5] Thus, a Republican or Democratic party committee may not make any contributions to the general election campaign of its Presidential and Vice Presidential nominees if those nominees accept public funding. 9003.2(a)(2).

Contributions to Compliance Fund

Publicly funded nominees may, however, accept contributions designated for a general election legal and accounting compliance fund (GELAC fund), a special account used to pay legal and accounting expenses incurred in complying with the campaign finance law. Contributions to a GELAC fund are subject to the Act’s prohibitions and the per-election contribution limits. (Contributions are limited to $2,000 or, in the case of a multicandidate committee, $5,000.)

Contributions to Nonmajor Party Nominees

General election contributions to the Presidential nominee of a nonmajor party are subject to the per-election contribution limits. 110.1(j)(1) and 110.2(i)(1).

A minor or new party candidate in the Presidential general election may qualify for partial public funding if the party’s nominee in the previous Presidential election received at least 5 percent of the popular vote or if the current nominee receives at least 5 percent of the vote. The nominee may accept contributions (subject to the limits and prohibitions) to pay for expenses in excess of the public funding grant. (The candidate is subject to the same spending limit as a major party nominee.) 9003.2(b) and 9003.3(c)(1).

Exempt Activities

State and local party committees may support the party’s Presidential ticket through the exempt party activities listed earlier in this chapter.

Coordinated Party Expenditures

As stated earlier, only a national party committee has a coordinated party spending limit for the party’s Presidential nominee. Other party committees may spend against this limit if they have the national committee’s prior written authorization (which should include the amount that may be spent). 109.33.

As explained before, a party committee cannot include the name of any candidate in its own name. FEC rules also prohibit a party committee (or any unauthorized committee) from using a candidate’s name in the name of a special communication, such as a fundraising or advertising project, unless the name clearly shows opposition to the identified candidate. 102.14(a) and (b)(3). Candidate names may, however, be used in the text of the communication.

A special project that opposes a candidate (e.g., a fundraiser entitled “Defeat Jones in ’04”) is considered an in-kind contribution, a coordinated party expenditure or an independent expenditure on behalf of the candidate’s opponent. (See “Communications.” )

Party activities and expenses that indirectly benefit candidates but that are not directly attributable to any clearly identified candidate are not considered contributions or coordinated party expenditures and therefore do not count against those limits. Nevertheless, party committees with separate federal, Levin and nonfederal accounts must allocate a portion of such costs as federal expenses, payable with permissible funds. 106.1(c)(1) and (2), 106.1(e); 106.5(a)(1). (For information on setting up federal and nonfederal accounts, see here; see Chapters 13 and 14 for details on allocation.)

The specific types of indirect support activities described below must be allocated.

Administrative Expenses

Expenses for rent, personnel, overhead and other day-to-day costs of running the committee are not considered contributions or coordinated party expenditures as long as the expenses are not directly attributable to a clearly identified candidate. As explained above, however, some of these expenses are allocable. 106.1(c)(1); 106.5(a)(2)(i).

Generic Voter Drive Costs

Activities that urge the general public to register, to vote or to support candidates of a particular party or associated with a particular issue, without mentioning a specific candidate, are not considered contributions or coordinated party expenditures, but costs for this type of activity are allocable. 106.1(c)(2); 106.5(a)(2)(iv).

In many instances, however, these activities will qualify as federal election activity, triggering specific payment and disclosure requirements discussed in the next chapter.