August 30, 2007

By: Laurence D. Laufer

Soliciting Political Contributions: A Recent Subject of Regulation

Generally, campaign finance laws limit -- or prohibit -- the making and acceptance of certain campaign contributions. Some recent laws go further and regulate the act of soliciting contributions. Here are a few examples. Under the federal Bipartisan Campaign Reform Act (BCRA) (2002) national parties, federal candidates and federal officeholders may not solicit non-federal funds (a/k/a "soft money"). After rulemaking, litigation, and another rulemaking, the Federal Election Commission (FEC) defines "to solicit" as "to ask, request, or recommend, explicitly or implicitly, that another person make a contribution, donation, transfer of funds, or otherwise provide anything of value." The federal lobbying reform legislation (2007) that is expected to be signed into law by President Bush would require candidate committees, leadership PACs and political parties to disclose to the FEC those registered federal lobbyists who have "bundled contributions" and the aggregate amount the lobbyist has bundled. The bill defines a bundled contribution as a contribution the lobbyist has "forwarded" or that the recipient has "credited" to the lobbyist "through records, designations, or other means of recognizing that a certain amount of money has been raised by that person." Business entities are ineligible for being awarded procurement contracts with the State of New Jersey if they or associated persons solicit reportable contributions (i.e., > $300 per election for a gubernatorial committee, or > $300 per year for a state or county party committee) during time periods specified in New Jersey's "pay-to-play" prohibition law (2004 - 2005). This restriction on soliciting contributions accompanies a comparable limitation on making contributions. Some of the municipal ordinances regulating pay-to-play in New Jersey impose similar restrictions on soliciting (and making) contributions to local candidates and committees (2003 - 2007). In the City of New York, lobbyists must report fundraising activities of the lobbyist and associated persons, specifically the “solicitation or collection” of contributions for candidates for City office and for public servants who are candidates for any elective office, whether done as a volunteer or for compensation (2006). New York City lobbyists must also report their political consulting activities. A recent amendment to NYC's campaign finance law (2007) will broaden the definition of "intermediary" to include persons who solicit contributions, where such solicitation is known to the candidate or authorized committee. Previously, only persons who "delivered" contributions were treated as intermediaries. City candidates must report intermediaries and intermediated contributions in their public disclosure statements.

Tags: New York CityNew JerseyFederal