AO 2005-13: Nonconnected PAC’s allocation of expenses and treatment of solicitation proceeds as contributions
EMILY’s List, a nonconnected federal political action committee (PAC), must use federal funds to pay for at least half of its administrative and generic voter drive expenses, and communications that refer to a political party. Communications that refer to a clearly identified federal candidate must be financed exclusively with federal funds. In addition, EMILY’s List must treat as federal contributions the proceeds of any communication that indicates a portion of the funds received will be used to support the election of a clearly identified federal candidate.
Allocation of administrative and generic voter drive expenses
EMILY’s List is a nonconnected PAC active in both federal and nonfederal elections. During the 2006 election cycle, EMILY’s List plans to spend 65 percent of its “candidate budget” on nonfederal candidates. These expenses include, among other things, in-kind donations, polling, get-out-the-vote programs, fundraising and broadcast communications.
Commission regulations require nonconnected federal political committees to pay administrative and generic voter drive expenses with a minimum of 50 percent federal funds. 11 CFR 106.6(b)(1)(i), (b)(1) (iii) and (c). This allocation minimum recognizes that nonconnected PACs can be “dual purpose,” engaging in both federal and nonfederal election activity, but requires them to use the 50 percent federal minimum regardless of their activity. Therefore, even if EMILY’s List spends 65 percent of its budget on nonfederal candidates, it must pay for at least half of its administrative and generic voter drive expenses with federal funds.
Allocation of expenses for public communications
Public communication that refers to a clearly identified federal candidate
EMILY’s List plans to make a public communication this election cycle in support of state legislative candidates. The communication will refer to a federal officeholder, Senator Debbie Stabenow, who represents Michigan in the US Senate, and is also up for re-election in 2006, and will feature a discussion of the Senator’s experiences earlier in her career as a candidate for state office. The communication will not be distributed in the Senator’s home state of Michigan, nor will it make reference the Senator’s candidacy for re-election or solicit funds for her campaign.
Commission regulations require nonconnected PACs to pay the costs of a public communication that refers to a clearly identified federal candidate, but does not refer to any nonfederal candidate, with 100 percent federal funds, regardless of whether the communication references a political party. 11 CFR 106.6(b)(2)(ii) and (f)(1)(i). Since EMILY’s List’s proposed communication references a clearly identified federal candidate, it must be paid for with federal funds.
The Commission noted that its analysis of the proposed communication would not change if a candidate for election in a year other than 2006 were substituted for Senator Stabenow. The Federal Election Campaign Act (the Act) and Commission regulations define a candidate as an individual seeking nomination for election, or election, to federal office and, who has received contributions or made expenditures aggregating in excess of $5,000. See 2 U.S.C. 431(2)(A); 11 CFR 100.3(a)(1). Neither the Act nor regulations distinguish between candidates based on election date.
Public communication that refers to a political party
EMILY’s List also plans to make a public communication in support of state legislative initiatives and referenda that will refer to “Democrats,” but not to any federal or nonfederal candidate. The communication will not be broadcast on radio or television.
Commission regulations require nonconnected PACs to pay for public communications that refer to a political party, but do not refer to any candidates, with at least 50 percent federal funds. 11 CFR 106.6(b)(1)(iv) and (c). In promulgating these rules, the Commission noted that references solely to a political party inherently influence both federal and nonfederal elections, and applying the 50 percent minimum federal funds requirement reflects the “dual nature” of the communication. Therefore, EMILY’s List must use federal funds to finance at least half the cost of its public communication referring to “Democrats.”
The result would not change even if EMILY’s List otherwise supports only nonfederal candidates in the state where the public communication is distributed. Commission regulations apply to public communications based upon the content of the communication, without regard to other activities of the person making the communication.
Treatment of solicitation proceeds as contributions
Commission regulations treat as federal contributions any funds donated in response to a communication that indicates the funds received will be used to support or oppose the election of a clearly identified federal candidate. 11 CFR 100.57(a). As federal contributions, the funds must comply with the Act’s limits and prohibitions, and also count toward the recipient’s $1,000 political committee registration threshold. 11 CFR 100.5(a).
EMILY’s List provided excerpts from three fundraising letters it plans to send that feature a federal candidate—Senator Stabenow—but do not reference any other clearly identified federal candidates. Each of the three excerpts indicates that the funds EMILY’s List receives in response will be used to support candidates and implicitly to support their election to office. However, in evaluating the sample text, the determination as to whether the proceeds must be considered contributions, and as such comply with the amount limitations, source prohibitions and reporting requirements of the Act, depends upon whether the communication indicates that Senator Stabenow is among those supported candidates.
In two of the three excerpts, Senator Stabenow indicates some of the funds raised would be used to support her re-election.¹ As such, all of the funds received in response to those communications must be treated as federal contributions to EMILY’s List. In contrast, the third excerpt indicates that the funds collected would be used on behalf of women seeking state office, which would not include Senator Stabenow as a federal candidate. As such, any of the funds received in response to that communication may be considered donations to the EMILY’s List nonfederal account.
Date Issued: October 20, 2005; Length: 7 pages
¹ The statements of support for Senator Stabenow include, “support candidates, who like me, could never succeed as women in politics,” and “I [Senator Stabenow] need your help.