1. What you need to know about campaign finance
FEC – Federal Election Commission
BCRA – Bipartisan Campaign Reform Act
Hard money = Federal money
Political donations raised from federally permissible sources within the limits established by BCRA
Soft money = Nonfederal money
Political donations made in such a way as to avoid federal regulations.

2. Overview History of Campaign Finance Regulation
Beginning of time—Civil War: No regulation
Civil War—1910
Gilded Age
Exceptionally scandalous politicians nationally
Boss Tweed
1868: 75% of money used in congressional elections through party assessments
1867: Naval Appropriations Bill
First federal effort to regulate campaign finance
Aimed at stopping the political shakedown naval yard workers for political contributions
Prohibits officers and employees of the fed. gov’t from soliciting contributions
1883: Civil Service Reform Act (Pendleton Act) prohibits the same solicitation of all federal workers

3. Overview History of Campaign Finance Regulation
Corrupt Practices Acts of 1911 and 1925
Set disclosure requirements for House and Senate Elections
Spending limits ($25k for Senate; $5k for House)
Ridiculously weak and regularly violated
1971 Federal Election Campaign Act (FECA)
1976: Buckley v. Valeo (1976)

4. Campaign Finance Reform and Buckley I
Original Provision
Effect of Buckley v. Valeo
Expenditure limits
Overall spending limits (Congress and president)
Struck down partially (freedom of speech)
Limits on the use of candidates’ own resources
Struck down entirely (freedom of speech)
Limits on media expenditures
Independent expenditure limits

5. Campaign Finance Reform and Buckley II
Original Provision
Effect of Buckley v. Valeo
Contribution limits
Individual limits: $1k/candidate/election
Affirmed
PAC limits: $5k/candidate/election
Party committee limits: $5k/candidate/election
Cap on total contributions individual can make to all candidates ($25k)
Struck down (freedom of speech)
Cap on spending “on behalf of candidates” by parties

6. Federal Election Commission
Purpose
In 1975, Congress created the Federal Election Commission (FEC) to administer and enforce the Federal Election Campaign Act (FECA)
the statute that governs the financing of federal elections.
The duties of the FEC, which is an independent regulatory agency, are to
disclose campaign finance information
enforce the provisions of the law such as the limits and prohibitions on contributions,
oversee the public funding of Presidential elections.

7. FEC Rules & Regulations The Players
Government
FEC – Federal Election Commission
Campaign Committees
Candidates
National Party Committees
State & Local Party Committees
Separate Segregated Funds
PACs connected to corporations, unions, etc.
Nonconnected Committees
All other PACs
527s
Individuals

8. Various Election Law Federal Election Campaign Act (FECA) 1975
Bipartisan Campaign Reform Act (BCRA) 2003
Major changes under BCRA

9. What does Federal Election Law Regulate?
In General
The financing of federal elections
Specifically
Disclosure of financial activity
Contributions
Receiving and Giving
Expenditures
Candidate support activities
Federal election activities

10. Disclosure What is required? Reporting complexity Honor
Problem/loophole?

11. Types of Money Federal Funds Levin Funds Nonfederal Funds
Collected from permissible sources
Subject to contribution limits
Levin Funds
For state and local party committees only
Collected from any entity except fed cand.
Only used for certain types of FEA
Nonfederal Funds
Subject to state law only
May be used to pay for expenses related to not federal elections

12. Fundraising & Making Contributions
Who can contribute?
How much can they contribute?
Special methods
Joint fundraising
Earmarking

13. Special Rules for Candidates
Only federal funds
Same restrictions on fundraising
Restrictions on spending
Millionaire’s Amendment

14. Other Ways to Support Candidates
In-kind contributions
Anyone
Independent expenditures
Coordinated Expenditures
Issues
SC overruled provision in BCRA prohibiting IEs after CE in same month
Violation of 1st Amendment

15. Federal Election Activities
GOTV
Voter ID
Generic Campaign Activity
Voter Registration
Public Communication

16. Content of Communications
Express Advocacy
Direct Candidate Support
Contribution, IE or CE
Public Communication Language
Promote, oppose, support, attack
Not direct candidate support
Must be paid for with federal funds
What is the difference?

17. Effects of BCRA on National Parties
RNC
Almost $40,000,000
DNC
Slightly over $10,000,000
Hilary Clinton
Over $20,000,000
Where did all the money go?
Surge in dem affiliated 527s post BCRA

18. Upcoming Federal Campaign Finance Issues
Should they be regulated by the FEC?
Internet
Currently not considered political advocacy
Not regulated by FEC

19. Who raises What? Federal candidate comm State candidate comm
Only federal money
State candidate comm
Only state money
National Parties
State/Local parties
Federal
Levin
State
PACs
527s
Neither fed nor state money

20. Hierarchy of MONEY State Parties
Federal
“Hard Money”
Levin
Quasi-Fed $
State
“Soft Money”
Federal Money
Most limitations
Federal, state and local elections
Levin Money
Fewer limitations
Some Federal election activities, state and local
State Money
Typically, fewest limitations
State and local elections only

21. Example State Party Regulations
Virginia State Contribution Regulations
Rule 1 – Unlimited contributions from any type of entity (except foreign nationals) are permitted
Rule 2 – If in doubt, see Rule 1
TN State Party Contribution Regulations
Unlimited contributions from individuals
Contributions from foreign nationals, corporations and some LLCs are prohibited

22. Where does my money go? It depends! Candidate
Candidate specific activities
Contributions to other candidates, parties or causes
DNC/RNC
Federal candidates
Allocated nationally
State Party Committees
Federal, state & local candidates
Allocated statewide
PACs
Support candidates, parties that agree on specific issues
527s
Separate campaign

23. Loopholes/Issues of BCRA Purpose: To outlaw the use of soft money in federal elections
Continuous re-writing of FEC regulations
Unlimited State to State transfers
Honor system vs. realistic expectations
Constitutional Violations
Internet

24. Campaign Structure

25. “Working Together”
Federal Candidate Committee (FEC) –Nicolosi for President Campaign Committee
National Party (FEC) – Democratic National Committee
State Parties (FEC & State Election Comm) – Democratic Party of Virginia
Local Parties (FEC & State Election Comm)
PACs
Leadership PACs – Forward Together
Union PACs
Corporate PACs
Individual contributors

26. Working ‘Together’ ACT/Swift Boat Veterans for Truth Section 527
File reports with IRS
Not subject to FEC contribution/expenditure restrictions
Not permitted to coordinate with candidates and campaigns for candidates
Separate GOTV plan
Separate message – but no “expressed advocacy”
Nicolosi rocks because he loves puppy dogs NOT Vote for Nicolosi
FEC REGULATIONS APPLICABLE if:
Mention federal candidate AND
Aired within 60 days of federal election

27. Citizens United Case: Changing the game? Or Not?
Case: Conservative advocacy group –
-Accepted corporate money to make a movie about Hillary Clinton
- Was it an attack ad funded by an outside group? Prohibited by FEC/ BCRA
- Court looks at Speech during an election year
Decision 5-4 – Corporations have First Amendment Rights too!
SUPER PACs – must disclose donors, 527s GENERALLY do not. Still can’t coordinate
with the campaign. Must be independent, but does it leave you, the candidate, in less
control of your campaign and its message?
Effects? Huge amounts of Money Spent – see next slide. Does it matter.