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National Party 2.0: FECA Amendments in Omnibus Spending Bill Increase Fundraising Power of National Parties

If you skipped to the final pages of the omnibus spending bill unveiled last night to see how it ends, you would find a rather dramatic change in campaign finance law related to party committee contribution limits.  Page 1599 (of 1603) of the spending package contains amendments to the Federal Election Campaign Act (FECA) that give national party committees additional avenues for fundraising, effectively returning to the parties some of the power that has been diminished with the rise of super PACs and other outside spending groups.  The law still needs to pass Congress and be signed by the President, but it is not too soon to consider the potential impact of these changes.

What is in the omnibus amendments to FECA?

At its core, the changes to the law would allow national party committees to create up to three additional specialized “accounts,” each of which could receive contributions from individuals and PACs that are triple the amount that can be given to the main party account.  The three separate, segregated accounts can be used to pay for expenses related to the following areas:

  1. Presidential nominating conventions;

  2. Headquarters buildings of the party (which includes construction, purchase, renovation, operation, and furnishing);

  3. Election recounts, contests, and other legal proceedings.

While the presidential nominating conventions account is only available to the RNC and the DNC, the other two accounts are available to all national party committees (RNC, NRSC, NRCC, DNC, DSCC, DCCC).  Based on the language of the statutory amendments, it appears that this could give each party the ability to createseven new accounts, each with triple the existing contribution limits.  The following chart should help summarize how much individuals could give to the various accounts per year.

 Chart Spending 

As this chart shows, individuals would be able to give up to $777,600 to a party’s various accounts each year.  This means that a couple could give up to $3,110,400 to a party in a two-year election cycle.  This is a major increase in the potential spending power of the national parties.

The amendments also allow PACs to contribute more to national party committees.  PACs could contribute up to $15,000 per year to the main accounts of a party committee and up to $45,000 per year to each of the seven new accounts described above.

These changes apply only to contributions from individuals and PACs.  The ban on corporate and union contributions still applies to the new accounts.

In addition to providing several new accounts into which each party can stockpile funds, the FECA amendments in the omnibus spending bill stripped away the coordination restrictions on each of these new accounts.  This would allow the party committees to work with presidential and congressional candidates on activities supported by these funds without violating existing limits on coordinated activities or in kind contribution limits.

What will the parties do with all of this new money?

The answer to this question will be developed over time as the parties figure out the boundaries of the new law.  But the activities supported by these funds will almost certainly extend beyond what is traditionally thought of as relating to the national party conventions, party headquarter buildings, and legal expenses.

This is particularly the case with the building account.  Under the omnibus amendments, this account can be used to pay for construction and operation of party headquarters buildings.  It is possible that “party operations” could include activities such as data mining and modeling projects or opposition research centers.  This is the account to watch to determine how much of an impact these amendments will have on the balance of power between national parties and super PACs.

Other account activities to watch, should the bill become law:  the new party convention accounts could be a route to tickets and passes to the national conventions.  While this might be too much for many PACs, some bigger PACs could afford $45,000 for a convention ticket.  The amendments do contain a $20 million cap on expenditures from the new convention accounts.

Remember, this is not the law yet.  We will continue to monitor the progress of these amendments as the spending bill makes its way through the congressional process and to the President’s desk.

© 2022 Covington & Burling LLPNational Law Review, Volume IV, Number 344

About this Author

Robert Kelner, Covington, Government affairs attorney

Robert Kelner is the chair of Covington’s nationally recognized Election and Political Law Practice Group.  He counsels clients on the full range of political law compliance matters, and defends clients in civil and criminal law enforcement investigations concerning political activity. He also leads the firm’s prominent congressional investigations practice.

Mr. Kelner’s political law compliance practice covers federal and state campaign finance, lobbying disclosure, pay to play, and government ethics laws. His expertise includes the Federal Election Campaign Act...

Robert Lenhard, Election and political attorney, Covington

Robert Lenhard is a member of the firm’s Election & Political Law practice group and advises corporations, trade associations, not-for-profit organizations, and high-net-worth individuals on compliance with federal and state campaign finance, lobbying, and government ethics laws.

Mr. Lenhard routinely assists clients in establishing and operating federal and state PACs, compliance programs associated with campaign finance and pay-to-play laws; advises advocacy groups and their donors; conducts compliance trainings and audits of federal and state lobbying and...

Anthony Herman, international arbitration lawyer, Covington
Senior Counsel

A first-chair litigator and trial lawyer, Tony Herman has tried to verdict more than 25 cases, jury and non-jury, in federal and state courts and before arbitration panels throughout the U.S. His broad ranging general litigation, arbitration and trial practice includes environmental, intellectual property and technology litigation, employment litigation, FDA litigation, and general commercial litigation involving contracts, license agreements, and business torts. He has been in charge of large, complex litigation matters for companies such as National Geographic, Thomson...

Derek Lawlor, Election and political law attorney, Covington
Special Counsel

Derek Lawlor is special counsel in the firm’s Washington office and a member of the firm’s Election & Political Law and White Collar practice groups.  He assists corporations, nonprofit organizations, and trade associations with federal and state lobbying, campaign finance, and government ethics issues.  Mr. Lawlor also represents clients in government investigations and inquiries conducted by the Federal Election Commission, Office of Congressional Ethics, and Congressional Committees and Commissions.

Prior to receiving his law degree, Mr. Lawlor worked in...

Andrew Garrahan, Public policy attorney, Covington Burling

Andrew Garrahan represents and counsels clients at the intersection of law and politics. He guides them through both regulatory compliance issues and government investigations on matters including state and federal campaign finance, ethics, lobbying, and corruption.

Mr. Garrahan’s prior career in political fundraising gives him a unique perspective on the challenges faced by his clients, which include corporations, candidates, government officials, political and nonprofit organizations, and private individuals.