AO 2022-09: Joint fundraising by state party committee and nominee fund
The Democratic Party of Wisconsin Federal (the state party committee) may form a joint fundraising committee with a nominee fund established for the party’s eventual nominee for U.S. Senate under the conditions proposed.
Background
The state party committee plans to form a joint fundraising committee with a nominee fund that has been established for the party’s eventual nominee, who will be selected in Wisconsin’s primary election. The nominee fund is a separate account of a nonconnected political action committee that is registered with the Commission and not affiliated with the state party committee.
The state party committee proposes to open a new separate account to be used solely for receiving and disbursing joint fundraising proceeds and to register a new joint fundraising committee. The joint fundraising committee would only accept contributions up to the total amount that the donor could contribute to the state party committee and the yet-determined federal candidate under the Federal Election Campaign Act (the Act). The state party committee and the nominee fund would comply with the Commission’s joint fundraising regulation, and the funds allocated to the nominee fund would be held in escrow by the joint fundraising committee.
After the primary election, the joint fundraising committee plans to disburse the funds directly to the nominee only if the nominee ratifies the joint fundraising agreement within 10 days of the state declaring a winner of the primary.
Analysis
In prior advisory opinions, the Commission has approved proposals to solicit and accept contributions to be forwarded to another committee where the ultimate recipient was not identified at the time of the solicitation. The Commission found these proposals permissible if they met four criteria: the condition that would trigger disbursement of the funds was objectively determinable and outside of the forwarding committee’s control; the forwarding committee specified a date by which the condition would or would not be met; the committee would refund or otherwise lawfully distribute the funds if the condition was not met; and all of these criteria were clearly communicated to contributors.
The Commission found the state party committee’s proposal to be consistent with these criteria because the committee will only disburse the funds if the state of Wisconsin declares the winner of the Democratic primary and the nominee ratifies the joint fundraising agreement. These conditions are objectively determinable events outside of the control of the forwarding committee. The joint fundraising committee will only disburse the escrowed funds if the nominee ratifies the agreement within 10 days of the state declaring a winner and it will refund the escrowed funds if the nominee does not ratify the agreement within that 10-day period. Lastly, the joint fundraising committee will clearly communicate these factors to contributors.
As such, the Commission found the state party committee’s proposal to be permissible because it is consistent with the regulation governing joint fundraising activities and prior advisory opinions concerning the solicitation of contributions on behalf of a yet-determined recipient.
Date Issued: July 14, 2022; Length: 7 pages
Citations
Regulations
11 CFR § 102.17
Joint fundraising by committees other than separate segregated funds