Just the Facts

Five Facts on Campaign Finance

By No Labels
July 29, 2019 | Blog

Political campaigns are complex and expensive operations. Presidential campaigns can cost over $1 billion per candidate. Many people wonder where all of the money comes from and how candidates raise it. Here are the facts. 

The Federal Election Commission (FEC) is the independent regulatory body that enforces campaign finance law in federal elections. 

The FEC oversees federal campaigns – covering U.S. House, Senate, and presidential elections. The FEC works to prevent corruption in federal elections by monitoring campaign contributions, enforcing regulations on spending, and disclosing campaign finance information to the public. The FEC also oversees the presidential public funding program which gives federal funds to eligible candidates[1]

While some candidates may choose to self-fund campaigns, the majority are funded through outside contributions. 

A contribution is “anything of value given, loaned or advanced to influence a federal election”. The FEC imposes limits on campaign contributions that any individual can contribute to any campaign. The limits are set to ensure that a small number of wealthy individuals wouldn’t have disproportionate influence on elections[2]. For 2019-2020 federal elections, an individual can donate up to $2,800 directly to a candidate committee per each separate election and up to $106,500 per account per year to national party committee accounts[3]. Donations less than $200 are unitemized and are considered small donations which candidates use to gauge grassroots support. 

Aside from individual contributions, candidates can also be supported by Political Action Committees (PACs).

PACs are organized to raise and spend money to elect or defeat candidates. PACs can represent specific interests or organizations[4]. PACs have been in existence since 1944 and are not directly run by a candidate or a party, and have limitations on contributions they can receive and money they can spend. A PAC can accept contributions up to $5,000 per year from any individual, can contribute $5,000 per election to a specific candidate and $15,000 to a party committee[5]

The 2010 Supreme Court decision in Citizens United v. FECoverturned restrictions on political spending by corporations, nonprofits, and unions. 

The Citizens United decision allowed for the creation of Super PACs that can accept unlimited contributions for independent political spending[6]. In Citizens United the Supreme Court ruled that limiting independent expenditures by corporations, unions and other groups violated free speech. Super PACs cannot donate directly to candidates nor coordinate with their official campaigns. However, they can raise and spend unlimited amounts of money to advocate directly for or against political candidates or causes.

Campaigns can decide how to spend the money that they raise, but the FEC does place limits on how they can use campaign funds. 

The Federal Election Campaign Act states that funds can be used for campaign expenses such as salaries, rent, day-to-day operations, campaign fundraisers, travel, and media expenses. Campaign funds can be used for minimal non-campaign expenses, but cannot be used for personal expenses. [7]

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