Capitalizing on a political contribution cap hike

Introduction

A pair of wealthy campaign contributors — including one who’s dead — wasted no time exercising their newfound right to pump political parties with significantly more cash than they could before December.

Public Storage founder B. Wayne Hughes Sr. gave the Republican National Committee $67,600 on Dec. 30, which the RNC labeled as a “convention fund contribution,” according to new federal campaign finance disclosures.

The Democratic Congressional Campaign Committee, meanwhile, reported receiving $38,392.06 on Dec. 31 from what appears to be a trust for the estate of Robert Bohna, a Sonoma, California, businessman who died five years ago. That contribution is labeled in a federal filing as a “building fund contribution.”

Campaign finance changes passed by Congress in mid-December and subsequently signed into law by President Barack Obama allow national political party committees to collect money designated for separate presidential convention, building and recount funds. The law builds on a Federal Election Commission ruling from October, which gave political parties greater ability to raise funds for their quadrennial political conventions.

The practical effect for wealthy donors: It greatly increases the total amount of money they may give to party committees, from less than $100,000 a year to $777,600 per year.

Political parties “don’t miss a beat,” said Larry Noble, a former general counsel of the Federal Election Commission who is now a lawyer with the Campaign Legal Center, referring to the parties. “They’re relentless … usually, the day after the election they start fundraising for the next election, so it’s not surprising that the day after the bill went into effect they started raising money for it.”

Josh Schwerin, a spokesman for the DCCC, said the Bohna contribution is the only one the DCCC has accepted under the new rules so far.

The RNC did not respond to a request for comment about the contribution from Hughes. But the new law, passed Dec. 11, allowed parties to create such convention funds.

Parties had recount funds before the law passed, but the new law allows donors to give more. The National Republican Congressional Committee reported receiving contributions for a recount fund both before and after the legislation passed Congress, making it difficult to tell which contributions are attributable to the new law.

The NRCC declined comment. Among the contributions to the recount fund it reported receiving after the new law passed: $15,000 from Koch Industries PAC on Dec. 23.

The FEC has not yet created rules directing parties how to report the contributions to the new funds, nor is there a timetable for the agency to issue the guidelines. This could make for confusing reporting — both for the party committees and people reading the committees’ reports.

The parties “are probably identifying these things on their own … because they want to avoid getting letters from the FEC saying they have exceeded contribution limits. A lot of this stuff is automated,” said Jan Baran, co-chairman of the election law and government ethics practice at Wiley Rein.

In a related matter, the FEC this week did release a routine increase to contribution caps to compensate for inflation.

Under the new limits, individuals can give candidates up to $2,700 for the primary and $2,700 for the general election, an increase from $2,600, and up to $33,400 per year to national party committees, compared to $32,400 per year.

The FEC also increased the threshold amount lobbyists can raise for a political committee before their names must be disclosed, to $17,600 from $17,300.