Campaign finance reform

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Campaign Finance Reform (CFR)

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Types of CFRDebating reformCurrent regulationsHistory of CFRPublic financing of campaignsState reporting requirements
Campaign finance reform or CFR refers to attempts to regulate the ways in which political campaigns are funded. This includes all spending done to promote or support the promotion of candidates, ballot measures, political parties and more. Regulations can be applied to natural persons, corporations, political action committees, political parties and other organizations. They can come in the form of incentives, such as providing public financing to candidates who abide by spending limits, as well as restrictions, such as contribution limits on donors. Legislative efforts, judicial rulings and citizen initiatives have all played roles in shaping the regulation of political contributions.

This page provides information regarding:

  • Different types of campaign finance reform, such as disclosure, public financing and contribution limits
  • Debates surrounding campaign finance reform
  • Federal and state campaign finance regulations
  • Organizations related to advocacy and research around campaign finance reform
See also: History of campaign finance reform

Types of CFR

Disclosure

The federal and state governments require some level of disclosure from candidates, committees and political parties of the amount and source of contributions and expenditures. States vary in the detail required in disclosures and in the frequency of reporting. A recent trend has been the use of electronic disclosure systems. According to the National Conference of State Legislatures, this method is effective because it is quick and accurate, as well as being inexpensive once software is developed.[1]

In 2008, Grading State Disclosure published a comprehensive assessment of state campaign finance disclosure laws and practices. The report graded states on a letter scale from A to F. The reports' significant findings included:

Grading State Disclosure project logo
  • 31 states require candidates to disclose the occupation and employer of their contributors;
  • 36 states require timely reporting of last-minute contributions;
  • 44 states require independent expenditures to be reported;
  • 30 states require statewide candidates to file disclosure reports electronically;
  • 24 states require both statewide and legislative candidates to file disclosure reports electronically;
  • 12 states operate a voluntary electronic filing program for candidates;
  • 8 states have no electronic filing program;
  • 49 states post campaign finance data on their disclosure web sites;
  • 39 states provide searchable databases of contributions online; and
  • 27 states provide searchable databases of expenditures online.

[2]

—Grading State Disclosure, [3]

Ballotpedia has pages for each state's campaign finance requirements for ballot measures. A list of those pages can be found here. To see a state-by-state comparison of the disclosure requirements for ballot measures see this state by state comparison of campaign finance reporting requirements.

Contribution limits

Another common method of regulating political contributions is to limit the amount and source of them. Such limits can be made to adjust periodically according to the Consumer Price Index. Limitations can take the form of bans against certain sources, such as corporations or unions, or they can place limitations as to the amounts that can be contributed. However, there are a number of potential ways to combine these methods. For example, particular sources can be given differing contribution limits. Another example could be having contribution limits on particular campaigns, overall limits for a source or a combination of individual campaign and overall election limits.[1][4]

Federal law prohibits any contributions from foreign nationals to any federal, state or local candidate, unless the person has a green card. Cash contributions are limited in 31 states. Most states set their limit at $100, but some have limits as low as $25. Minors are restricted in 19 states from making political contributions. Most states consider contributions of minors as part of their parent or guardian's political contributing. Ohio, in particular, prohibits any person under age seven from making political contributions. Lobbyists frequently face separate contribution limitations, as well.[5]

As of 2008, 13 states had no limit on how much can be given to political parties. Fourteen states had limits on how much corporations and labor unions could give, but did not restrict or limit contributions from other sources. The remaining 27 states had limits on contributing to political parties from most or all sources.[6]

The national average limit on individual contributions to candidates were as follows in 2011:[7]

  • $8,579 for gubernatorial races
  • $4,003 for state senates
  • $3,632 for house of representatives

Spending limits & public financing

Map of state public campaign financing methods for individual candidates. The colors correspond to the following financing methods: Purple-"Clean Elections," Orange-matching grants, Green-fixed subsidy, Pink-combination of matching grants and fixed subsidy and Gray-no public funds[8]

Spending limits are closely related to the method of contribution limits. Campaign spending limits place a cap on the amount a campaign can spend. The U.S. Supreme Court ruled in Buckley v. Valeo in 1976 that requiring candidates to abide by spending limits violates the First Amendment of the United States Constitution. The argument was because political campaigns use their funds to make political communications, those communications are deemed protected by the freedom of speech. Therefore, spending limits, on candidates, at least, were deemed to be limiting that right and unconstitutional.[1][9] The court has ruled that spending limits are constitutional only if they are optional, and several states have such optional spending limits. The case of Randall v. Sorell, upheld the Buckley v. Valeo ruling in 2006.[10]

Public financing of campaigns can be used to encourage candidates to abide by such optional limitations. Some states provide funds directly to individual candidates, some to political parties and yet others provide tax incentives to those who make political contributions.[1][11]

See also: Public financing of campaigns

Public funding to individual candidates

In total, 14 states offer some kind of public funding system to political candidates. A particular subset of these practices are sometimes referred to as Clean Elections. "Clean Elections" refers to systems where candidates who choose to receive public funding are prohibited from raising funds from other sources. However, in most states, public funds are only a portion of a candidates expenditures and they raise other funds within in the limitations of the public financing laws.[8]

Public funding to political parties

As of 2013, 10 states provided grants to qualified political parities. These grants tend to be small and funded through income tax check-offs or add-ons, usually in the amount of $1 to $5. These grants are often used to help finance party conventions. The grants are funded by income tax check-offs (which do not increase filer's tax liability) or add-ons (which increase filer's tax liability), ranging in amounts from $1 to $25. In most states, the amount is between $1 and $5. In eight states, the full amount of the add-on or check-off goes to the political party designated by the taxpayer. In most states, if the taxpayer fails to designate a political party, the amount is divided among the qualified political parties in the state according to their registration or their share of the most recent gubernatorial vote.[12] The following states give the full amount of the add-on or check-off of a taxpayer to a party they designate (or distribute it equally between the qualified parties if no party is designated):[12]

The remaining three states that provide public funds to political parities are the following:[12]

  • Kentucky: The full amount is given to the party designated by the taxpayer, but it is divided into two portions. The county party organization receives $0.50 and the state party receives $1.50.
  • Ohio: The funds are divided equally among all qualified parties.
  • Rhode Island: The first $2 is given to the political party designated by the taxpayer, and the remaining $3 is given to the candidate fund.

Debating reform

The arguments surrounding campaign finance reform are multifaceted. Individuals and organizations may support some kinds of reform while opposing others. They might also like reforms applied to only some types of campaigns, candidates, donors or organizations. The following sections provide a small look at the perspectives and arguments held by supporters and opponents of different CFR types. In these debates, several themes can be seen repeatedly, such as:

  • Is spending money an act of speech? If so, is that speech covered by the First Amendment?
  • Who counts as a person? Should corporations, non-profits and other groups have the same rights as natural persons?
  • What privacy is afforded to political speech? What should the balance be between transparency of campaign and privacy of contributors?

Also at stake in campaign finance reform debates is the matter of who is influencing politics. Proponents of more stringent regulations argue that without them the highest bidder wins. Opponents of such moves argue that regulations limit the freedom of speech and make politicians less accountable to voters.[13] The following sections discuss some of the tensions underlying opposition and support for various forms of campaign finance reform.

Transparency versus privacy

Disclosure practices lie at the heart of the debate surrounding the need for transparency in campaign financing and the right to privacy for political contributors.

In favor of transparency

Some argue that public campaign financing is a way to provide greater transparency to political campaigning. Public campaign financing has been touted as giving candidates the option to avoid being swayed by special interest donors. Public Campaign, which advocates for public funding of campaigns, argues that public financing allows elected officials to "consider legislation on the merits, without worrying about whether they are pleasing well heeled donors and lobbyists." It is also seen as reducing the amount of time spent raising money so that candidates and elected officials can spend more time talking to constituents.[14]

League of Women Voters logo

The American Civil Liberties Union has supported the disclosure of direct contributions to candidates, direct contributions to PACs and independent expenditures. The League of Women Voters has also supported full and timely disclosure of campaign contributions and expenditures. They have also advocated for one committee to coordinate, control and report financial transactions for each candidate, party or other committee, as well as an independent body to monitor and enforce the law.[15][16]

In favor of contributor privacy

Most of the arguments against disclosure are not entirely against the practice. Rather, they seek to place limits on which contributions should have to be disclosed, and whether they should be disclosed publicly. Many who oppose broader disclosure of contributors to political campaigns see those contributions as a protected form of speech. Other arguments include concerns about the arduousness of reporting requirements hindering speech and that such disclosure reports are rarely utilized by voters because of their complexity and length.[17]

David N. Bossie, President of Citizens United and Citizens United Productions, has claimed that the information provided by current disclosure practices "does little if anything to enlighten a voter," due to the extensive length of the reports. He argues that,

David N. Bossie, President of Citizens United and Citizens United Productions

Disclosure must be balanced against the burden on potential speakers. Having to file reports that are thousands of pages long if one so much as mentions a candidate will severely chill speech. [2]

—David N. Bossie, [18]

David Keating, President of the Center for Competitive Politics, has argued that disclosure laws were put in place to shine light on large, secretive donations to candidates, but that the current disclosure efforts are covering too many small donations. The fact that donors of amounts as small as $50 can be looked up online and that potential employers could look up these donations are potential disincentives to smaller contributors who want to protect their privacy, according to Keating. He advocates for raising the threshold for publicly disclosing donations until they reach a set cumulative total.[19]

Money as speech

Related to the tension between transparency and privacy is the issue of money as speech. The U.S. Supreme Court ruling in Buckley v. Valeo established the precedent of political campaign donations as being a protected form of the freedom of speech. However, arguments continue to surround this ruling.

Contributions as protected speech

The American Civil Liberties Union has supported efforts to broaden disclosure and other transparency efforts, but they have "fought to protect the speech and privacy rights of those whose participation in the political process posed no threat of corruption or appearance of corruption." This has included advocating in several court cases for the removal of contribution limits or to increase the limit amount. The ACLU also opposed the 2010 DISCLOSE Act, arguing that it "fails to improve the integrity of political campaigns in any substantial way while significantly harming the speech and associational [sic] rights of Americans."[20][21][22][23]

The National Rifle Association has opposed efforts to broaden disclosure requirements on campaign contributions and expenditures, including legally challenging the McCain-Feingold campaign finance reform bill. In 2010, the organization said, "NRA believes that any restrictions on the political speech of Americans are unconstitutional."[24][25]

Money ≠ speech

Some of the arguments given by opponents of the "money as speech" position include:

  • "Money is not speech, but a way to fund and amplify speech:" spending money in politics can help people express themselves and lead to political speech, but it is not an act of speech in itself.[26]
  • "An election system in which unlimited political spending is protected speech replicates the systemic inequalities found in society." Money as speech means that those groups of people whose majority tend to have lower incomes have less speech-making power than groups whose majority have higher incomes. According to Public Citizen, the "median income of the top five donor zip codes in 2010 was approximately twice the national rate. The ethnic and racial background of those zip codes was also 80-90% white."[26]

John Paul Stevens, former U.S. Supreme Court justice, made a statement to Senate Committee on Rules and Administration on April 30, 2014, opposing the rulings of McCutcheon v. FEC. In his statement, he spoke strongly against the idea that money should be considered speech, saying,

While money is used to finance speech, money is not speech. Speech is only one of the activities that are financed by campaign contributions and expenditures. Those financial activities should not receive precisely the same constitutional protections as speech itself. After all, campaign funds were used to finance the Watergate burglary, actions that clearly were not protected by the First Amendment.[2]

John Paul Stevens, [27]

Attorney Dan Backer, who counseled Shaun McCutcheon in the McCutcheon v. FEC, said of the court's ruling on the matter,

The court did not say, and really neither does any serious commentator, that money is speech. Money is not speech. Money is a necessary tool to engage in political speech and political association.[2]

—Dan Backer, [28]

Current regulations

Federal campaign finance reporting

Penalties for noncompliance

According to the FEC, most violations of the Federal Election Campaign Act (FECA) result in civil penalties, but knowingly and willfully violating certain FECA provisions can lead to imprisonment. The FEC has exclusive civil enforcement authority, and may refer criminal violations to the U.S. Department of Justice. The sentencing guidelines for criminal violations of the law are set by the U.S. Sentencing Commission.[29]

State campaign finance reporting

The following table provides links to the rules for campaign finance in each state, the agencies that report on campaign finance, and links to public financing programs or voluntary spending limits when applicable. Note that states may have public financing or voluntary spending limits for only certain offices, and may even have public financing for some offices and voluntary spending limits for others.

Click on the green check marks to read about public financing and voluntary spending limit options in those states.

State Rules Reporting agency Public financing? Voluntary spending limits?
Alabama Read here Secretary of State
Alaska Read here Public Offices Commission
Arizona Read here Secretary of State Arizona Clean Elections
Arkansas Read here Secretary of State
California Read here Secretary of State Yes.png
Colorado Read here Secretary of State Yes.png
Connecticut Read here State Elections Enforcement Commission Citizens' Election Program
Delaware Read here State Election Commissioner
Florida Read here Division of Elections Public Campaign Finance
Hawaii Read here Campaign Spending Commission Yes.png
Idaho Read here Secretary of State
Illinois Read here Division of Campaign Disclosure
Indiana Read here Election Division
Iowa Read here Ethics & Campaign Disclosure Board
Kansas Read here Governmental Ethics Commission
Kentucky Read here Registry of Election Finance
Louisiana Read here Ethics Administration Program
Maine Read here Commission on Governmental Ethics and Election Practices Maine Clean Election Act
Maryland Read here State Board of Elections Yes.png
Massachusetts Read here Office of Campaign & Political Finance Public Finance System
Michigan Read here Secretary of State Yes.png
Minnesota Read here Campaign Finance and Public Disclosure Board link={
Mississippi Read here Secretary of State
Missouri Read here Ethics Commission
Montana Read here Commissioner of Political Practices
Nebraska Read here Accountability and Disclosure Commission Yes.png
Nevada Read here Secretary of State
New Hampshire Read here Secretary of State Yes.png
New Jersey Read here Election Law Enforcement Commission Yes.png
New Mexico Read here Secretary of State Yes.png
New York Read here Board of Elections Inprogress.jpg[30][31][32]
North Carolina Read here State Board of Elections Repealed 2013[33]
North Dakota Read here Secretary of State
Ohio Read here Secretary of State
Oklahoma Read here Ethics Commission
Oregon Read here Secretary of State
Pennsylvania Read here Secretary of State
Rhode Island Read here Board of Elections Yes.png
South Carolina Read here Ethics Commission
South Dakota Read here Secretary of State
Tennessee Read here Registry of Election Finance
Texas Read here Ethics Commission Yes.png
Utah Read here Lieutenant Governor's Office: Elections
Vermont Read here Secretary of State Yes.png
Virginia Read here State Board of Elections
Washington Read here State Public Disclosure Commission
West Virginia Read here Secretary of State Yes.png Yes.png
Wisconsin Read here Government Accountability Board Repealed 2013[34]
Wyoming Read here Secretary of State

See also

News articles

Related ballot measures

Additional reading

External links

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Suggest a link

CFR organizations

The lists below provide links to some of the many organizations that advocate for and against specific campaign finance reform practices, as well as organizations that research the impact of campaign finance reform efforts.

State specific links

References

  1. 1.0 1.1 1.2 1.3 National Conference of State Legislatures, "CAMPAIGN FINANCE REFORM: AN OVERVIEW," accessed May 2, 2014
  2. 2.0 2.1 2.2 2.3 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributed to the original source.
  3. Grading State Disclosure, "Executive Summary," September 17, 2008
  4. National Conference of State Legislatures, "CONTRIBUTION LIMITS: AN OVERVIEW," accessed May 2, 2014
  5. National Conference of State Legislatures, "PROHIBITED DONORS," December 6, 2011
  6. National Conference of State Legislatures, "Limits on Contributions to Political Parties," February 5, 2008
  7. National Conference of Legislatures, "MEDIAN AND AVERAGE CONTRIBUTION LIMITS -- 2011-2012 ELECTION CYCLE," October 3, 2011
  8. 8.0 8.1 National Conference of State Legislatures, "States Offering Public Financing to Candidates," January 23, 2013
  9. FindLaw, "Buckley v. Valeo. 424 U.S. 1 (1976)," decided January 20, 1976
  10. Cornell Univeristy Law School, Legal Information Institute, "RANDALL v. SORRELL (Nos. 04-1528, 04-1530 and 04-1697)," decided June 26, 2006
  11. National Conference of State Legislatures, "PUBLIC FINANCING OF CAMPAIGNS: AN OVERVIEW," January 23, 2013
  12. 12.0 12.1 12.2 National Conference of State Legislatures, "PUBLIC FINANCING OF CAMPAIGNS: AN OVERVIEW--States Offering Public Funds to Political Parties," January 23, 2013
  13. The Washington Times, "Senate Democrats declare war on Roberts’ Supreme Court, campaign finance freedoms," April 20, 2014
  14. Public Campaign, "Fair Facts," accessed May 12, 2014
  15. American Civil Liberties Union, "Campaign Finance Reform," accessed May 6, 2014
  16. League of Women Voter's, "Campaign Finance: The League’s History," July 2, 2013
  17. U.S. News, "Debate Club: Should There Be Less Disclosure in Campaign Finance?," accessed May 6, 2014
  18. U.S. News, "Campaign Finance Disclosure Is a Burden That Restricts Independent Speech," June 21, 2012
  19. U.S. News, "Campaign Finance Disclosure Rules Infringe on First Amendment Rights," June 21, 2012
  20. Cite error: Invalid <ref> tag; no text was provided for refs named ALCU
  21. American Civil Liberties Union, "Campaign Contribution Limits," June 24, 2010
  22. American Civil Liberties Union, "Nixon v. Shrink Missouri Government PAC: Rethinking Campaign Contribution Limits," March 20, 2000
  23. American Civil Liberties Union, "DISCLOSE ACT Passed By House Today Compromises Free Speech," June 24, 2010
  24. Sunlight Foundation, "NRA fights campaign finance reform, disclosure," January 15, 2013
  25. National Rifle Association, "NRA, Campaign Finance Bills And The Second Amendment," September 8, 2010
  26. 26.0 26.1 Public Citizen, "A Constitutional Amendment to Keep Corporate Money out of Elections: Overturning the “Money=Speech” Doctrine," accessed May 22, 2014
  27. Common Dreams, "'Money is Not Speech': Retired Justice Stevens Slams Dark Money Rulings," April 30, 2014
  28. Huffington Post, "Now He Tells Us: McCutcheon Attorney Admits Money Is Not Speech," April 7, 2014
  29. Federal Election Commission, "What penalties can the FEC impose for violations of the law?," accessed May 20, 2014
  30. New York is a unique case because it began testing a public financing program in 2014 limited to the State Comptroller election.
  31. New York State Board of Elections, "Public Financing Pilot Program," accessed May 21, 2014
  32. New York State Board of Elections, "Draft Regulation on Public Financing Pilot Program," accessed May 21, 2014
  33. North Carolina State Board of Elections, "2014 Campaign Finance Manual, (scroll to p. 6)" accessed May 21, 2014
  34. Wisconsin Government Accountability Board, "Public Funding," accessed May 21, 2014
  35. Note: This resource is somewhat out-of-date.