Presidential Hopefuls Skirt FEC Rules | Rules of the Game
Republican Wisconsin Gov. Scott Walker’s political organization is opening a campaign office for him in Iowa. Ex-Florida Gov. Jeb Bush is meeting with major donors and hosting dozens of fundraisers around the country. Hillary Rodham Clinton, former senator, secretary of State and first lady, is quietly hand-picking a team of high-level advisers to run her anticipated White House bid.
Yet none of these presidential hopefuls has officially declared their candidacy or even announced plans to test the waters of a White House run. That’s given them free rein to raise money through a crazy quilt of campaign-style committees, from tax-exempt issue groups to personal leadership political action committees, unrestricted super PACs, foundations and political organizations. Oversight is scant and disclosure spotty.
With only a couple of exceptions, the nearly 20 hopefuls eyeing the Oval Office are “likely violating” Federal Election Commission regulations that impose strict limits on candidates testing the waters of a White House bid, said Paul Ryan, senior counsel at the Campaign Legal Center and no relation to the congressman. Ryan recently published a white paper dubbed, “’Testing the Waters’ and the Big Lie: How Prospective Presidential Candidates Evade Candidate Contributions While the FEC Looks the Other Way.”
FEC guidelines state clearly that candidates testing the viability of a presidential bid may not collect corporate or union money, and must cap donations at $2,700 per election. Money used to test the presidential waters must also be publicly reported once a candidate officially declares. “They are ignoring federal campaign finance laws,” Ryan said of Walker, Bush and a long list of other candidates.
Until they officially declare their candidacies, the presidential hopefuls in the field run little risk of drawing attention from the FEC, which is stalemated by partisan divisions and has done little to enforce the rules lately. The candidates have said they are complying with campaign finance regulations.
Still, from Bush’s unrestricted super PAC, which reportedly has set out to raise $100 million by March 31, to the nonprofit advocacy group backing Republican Rick Santorum, the former senator from Pennsylvania, the diverse committees operated by this election’s 2016 White House hopefuls raise myriad legal and regulatory questions.
Take the global foundation set up by former President Bill Clinton. The charity’s work fighting AIDS, hunger and poverty has been overshadowed by recent reports it has accepted millions in contributions from corporations and foreign governments. The foundation halted most foreign contributions while Hillary Rodham Clinton served as secretary of State, to avoid the appearance of corruption and conflicts of interest. Should it do the same as she mulls a White House bid?
For all the bad press its foreign contributions have generated, the Clinton Foundation has voluntarily disclosed its contributions. The same cannot be said of the tax-exempt advocacy groups backing such presidential hopefuls as Santorum and former Arkansas Gov. Mike Huckabee, another Republican.
The nonprofit backing Santorum has the same name — Patriot Voices — as his leadership PAC. It was ostensibly set up to advance issues Santorum cares about, but is run by his former aides and largely promotes and publicizes his activities. America Takes Action, a tax-exempt social welfare group, similarly promotes Huckabee’s issues and agenda. Both groups may collect contributions of any size from any source, and operate outside the campaign disclosure rules.
And what about the unrestricted super PAC launched by Bush when he first signaled interest in a presidential campaign? Such PACs may collect unlimited donations as long as they don’t coordinate with the candidates they back. Bush is not yet a declared candidate, which explains why he is reportedly raising money for the group. But in the event Bush announces a candidacy, Ryan argues the PAC should be barred from spending money on his behalf.
As for Walker, his aides told U.S. News & World Report that his political organization, Our American Revival, is promoting “an issue environment and platform” for 2016 candidates, not testing the waters for Walker’s potential presidential bid. The organization, while it does disclose its receipts to the IRS, may accept unlimited contributions from any source.
GOP Sen. Marco Rubio of Florida is on a promotional tour sponsored by Sentinel, the Penguin Books subsidiary that published his book, “American Dreams.” The tour includes stops to sign books in Iowa and New Hampshire — a schedule that might raise questions if Rubio were a declared candidate.
In 2013, the Office of Congressional Ethics asked the full Ethics Committee to investigate whether then-Rep. Michele Bachmann’s book tour, paid for by the publisher of her book “Core of Conviction,” constituted an illegal in-kind contribution to her presidential campaign. The Ethics panel dropped the matter, but Bachmann remains under federal investigation amid various campaign finance allegations.
Only two White House hopefuls — Sen. Lindsey Graham, R-S.C., and former Sen. Jim Webb, D-Va. — have set up legitimate “testing the waters” committees that comply with FEC regulations, Ryan said. Graham’s “Security Through Strength” organization and Webb’s 2016 “Exploratory Committee” both accept contributions no larger than $2,700 per election.
“Sen. Graham and Sen. Webb appear to be complying with that requirement,” Ryan said. “And more than a dozen prospective presidential candidates appear to be ignoring it.”
Eliza Newlin Carney is a senior staff writer covering political money and election law for CQ Roll Call.