Single-Candidate Super PACs and the Transparency Option

January 8, 2016
posted by Bob Bauer

The Super PAC that sits most poorly with critics is the one devoted to a single candidate.  It comes across as a flaunting of the form: often established by a candidate’s friends or associates, created in just the election cycle in which the candidate runs, it just seems to them like a sham.  There been proposals to limit or cripple single candidate PACs, met in turn by objections that the constitutional law does not allow for it.  This objection has force because reform proposals focus solely on the question of spending limits, and it is on this point precisely that the constitutional barriers go up.  If the committee is not “coordinating” with the candidate on a specific expenditure, it retains it’s right to spend without limit for his benefit.

But there is another issue presented by the single-candidate Super PAC, allowing more room for a regulatory response: transparency.  As it happens, the problem is created in part by the law.  Unless a Super PAC is committed to the defeat of a particular candidate, in which case it can use the candidate’s name in “projects” or communications, it cannot have the candidate’s name built into its own. 11 C.F.R. 102.14(a), (b)(3).  The support that it provides the candidate is presented under an anodyne name, like Committee for An America Back on Track.  The press may well say that it is candidate X’s Super PAC, and candidate X may well try to sneak the independent committee’s fundraising into boasts about his financial position. On the public record, however, the candidate has no connection to the committee: he has “not authorized” it– for purposes of contribution or spending limits.

Because the single-candidate Super PAC is new to the scene, it stands out as a type of committee that falls through various disclosure cracks.  For example, “draft committees” established to encourage an individual to run to have the right to use her name: there’s no mystery about whom they’re supporting. 11 C.F.R.102.14(b)(2).  The individual being implored to run may be asked to “disavow” the draft committee, so its spending is not treated as her own and does not trigger any related requirements that she register a campaign committee. 11 C.F.R. 100.3(a)(3).  But the draft committee can proceed clearly and by name to urge a candidacy.

So it is only an independent committee supporting a particular candidate that is barred from using the candidate’s name. In this case, there is no public link between the committee and the candidate.

One conceivable approach would establish that link without running into constitutional complications.  A Super PAC organizing or operating to support only one candidate could be deemed a “supporting organization”, or something like that, defined as an independent committee organized and operating for the primary purpose of supporting candidate X.  A rule might provide that X be notified of an independent committee meeting that test. As in the case of draft committees, the candidate could “disavow” the designation, disputing that the committee truly supports him.

Most of the time, disavowal will be unavailable, because the purpose of the committee will be obvious. In the typical case, the candidate will be helping the independent committee within one of the exemptions—such as appearing as a speaker or “honored guest” at one of its events.  Candidates routinely “brand” their favored Super PACs, signaling to potential donors that the PAC has their approval, and then helping it in all ways they can.  A candidate involved in these activities will have to think twice about contesting a “supporting organization” designation.

This designation would not affect the right to spend independently, which would still be controlled by coordination rules applied within constitutional limits. The candidate, however, would have to amend FEC reporting forms to identify the committee as a supporting organization, and the supporting organization would do the same with its own filings, identifying the candidate as the one it was established or operating to support.  The disclaimers of the independent committee could similarly disclose or state its status as an independent committee “established or operating to support candidate X.”

It is true that at present political committees that register with the FEC have to indicate whether they “support/oppose” only one candidate.  The Super PACs known to be dedicated to particular candidates typically do not identify themselves as such. It is a designation easily avoided, because the political committees would answer that they support affirmatively only one candidate but oppose a significant number of others – – who happen to be candidates who present the greatest challenge to one they were established to support.  In any event, this requirement, useless in the case of Super PACs, was not promulgated with anything like single-candidate Super PACs in mind.

A new transparency requirement that applied to single-candidate Super PACs would be useful in going some way toward answering the complaints of those who think that these new political organizations require some regulatory response.  Building that response around transparency policy, in keeping with long-standing regulatory concerns with similar issues, as in the case of draft committees, might be worth considering.  The litigation risks would be manageable: in this instance, the odds would likely  favor of the regulator, if the Supreme Court holds to what it has said about transparency.

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