Understanding nonconnected PACs

A nonconnected committee is a political committee that is not a party committee, an authorized committee of a candidate or a separate segregated fund established by a corporation or labor organization.

Although nonconnected committees and corporate or labor separate segregated funds (SSFs) are both commonly called “political action committees” or “PACs,” a nonconnected committee is distinguishable from an SSF by the following basic features:

No connected organization

A nonconnected committee does not have a “connected organization”—that is, no corporation or labor organization establishes, administers or raises money for a nonconnected committee. (An SSF, by definition, always has a sponsoring corporation or labor organization.)

However, a nonconnected committee may nonetheless receive limited financial and administrative support from a sponsoring organization that is not a corporation or a labor organization, such as a partnership or an unincorporated association.

Limited sponsorship

All forms of support including money and other things of value received by a nonconnected committee from a sponsoring organization are considered contributions, which are subject to annual limits, prohibitions and disclosure requirements under the Federal Election Campaign Act.

By contrast, an SSF may generally receive unlimited administrative support from its connected organization, and such support is usually not subject to federal disclosure requirements.

Unrestricted solicitations

Unlike an SSF, a nonconnected committee may solicit contributions from anyone in the general public who may lawfully make a contribution in connection with a federal election.

An SSF, by contrast, may solicit only a limited class of individuals who have specific relationships with the connected organization (i.e., stockholders or members and certain employees of the connected organization and their families).