Election Law Attorneys serving Denver and Colorado

I'm interested in making a donation to a candidate or political party. What are the applicable individual contribution limits for the 2008 election cycle?

Federal individual contribution limits:

$10,000 per year to the federal account of a state political party;
$28,500 per year to a national political party;
$2,300 per election (primary and general) to a federal candidate committee;
Election cycle total limit of $108,200 to all federal candidates, parties and federal political committees (PACs) (with no more than $42,700 to federal candidates, and $65,500 to federal PACs and political parties).
State individual contribution limits:

$3,175 combined to the state, county, and local committees of a political party, with no more than $2,650 to the state political party;
$400 to a candidate for State Senate, State Representative, State Board of Education, CU Regent, or District Attorney ($200 primary / $200 general);
No contribution limits apply to county or municipal candidates, unless a local ordinance or charter provision has been adopted to limit contributions to such county or local candidates.

Who is prohibited from making political contributions?

For-profit corporations (including both C-corporations and S-corporations) and labor organizations (including labor unions) are prohibited from contributing to federal candidates, state or local candidates, and national, state, and local political parties. Foreign citizens are also prohibited from making political contributions to federal, state, and local candidates and political parties, and federal contractors cannot give to federal candidates or federal PACs.

Limited liability companies (LLCs) are prohibited from contributing at the federal or state level if they are taxed as corporations. If the LLC is taxed as a partnership, the contributions to federal committees are permitted, but contributions apply towards the individual contribution limits of the LLC members. Similarly, LLCs taxed as partnerships are also permitted to give to state and local candidates and political parties, with certain additional limitations, and contributions will be attributed to the individual LLC members and will count against applicable individual limits.

Corporations and labor organizations may contribute to up to $500 to a state political committee per election cycle, but are prohibited from giving corporate dollars to any federal PACs.

What contribution limits apply to 527 political organizations, or 501(c)(4) nonprofit groups?

In a word, virtually none (actually, that's two words). Corporations, labor organizations, foreign nationals, individuals, LLCs, partnerships, associations, state political committees, other out-of-state political action committees, and other entities may all contribute to a 527 political organization or a 501(c)(4) nonprofit. However, although such organizations may accept funds from virtually any individual or organization, not every individual or entity may contribute funds if other provisions of law and tax considerations apply to restrict the donor or contributor. Candidate committees are prohibited under state and federal law from giving to certain 527 and 501(c)(4) organizations, and churches and charitable foundations could lose their tax-exempt charitable status by engaging in any activity designed to support candidates for public office, including giving funds to support such political activity.

The use of corporate or labor organization funds by 527 or 501(c)(4) nonprofit groups for any communications referencing a candidate within 30 days of a primary election, or within 60 days of a general election (i.e. “electioneering communications”) may be subject to additional limitations and reporting requirements, depending on the nature of the communication. The application of recent case law and regulatory changes to the way independent organizations such as 527 groups and 501(c)(4) organizations may engage in electioneering communications is complicated, and often case-specific.

What registration and reporting requirements apply to 527 or 501(c)(4) nonprofit organizations?

In addition to the registration and contribution and expenditure disclosures required by the Internal Revenue Service, new registration and reporting requirements also apply to 527 political organizations attempting to influence the election of state or local candidates. 527 political organizations must register with the Colorado Secretary of State, and are required to disclose information about their donors and expenditures. In addition, 501(c)(4) groups and certain other non-profit organizations are now required to file annual reports with the IRS, regardless of their annual budgets. Prior rules only required nonprofits with annual income or expenditures in excess of $25,000 to file reports to the IRS.

What is the difference between "express advocacy" and "non-express" or "issue advocacy", and why is the distinction important?

In Colorado, any organization or group of persons that spends more than $200 to expressly advocate for the election or defeat of a state or local candidate, regardless of the group's filing or registration status, will be deemed to be a “political committee” for the purpose of state campaign finance regulation and limitations. Groups and organizations should studiously avoid using terms or words of express advocacy such as “vote for,” “elect,” “support,” “cast your ballot for,” “Smith for State Senate,” “vote against,” “defeat,” or “reject” in any publications or communications directed towards voters, or toward individuals other than the group's own members, unless they wish to be classified as and subject to all the campaign finance limits and reporting requirements of a political committee for state law purposes.

If a group engages in express advocacy, it must register with the Secretary of State as a political committee and is required to file regular contribution and expenditure reports and disclosures on a quarterly basis during off-election years and monthly and up to bi-weekly during election years. Moreover, the organization would then be prohibited from accepting corporate contributions, and would be limited to receiving only $500 per contributor, per election cycle. By understanding what constitutes express advocacy, and exercising a proper level of care, organization leaders can prevent their groups from inadvertently being considered political committees for the purposes of campaign finance law and restrictions. In addition, however, the Secretary of State and courts may look to the “major purpose” of the organization in determining whether they are subject to registration and regulation as a political committee, or as a political organization.

What is an "electioneering communication," and how are such communications regulated?

At the state level, an "electioneering communication" is any communication-including flyers, advertisements, television or radio broadcasts, direct mail, or other communications-directed toward voters that "unambiguously refers" to any state or local candidate within 30 days of a primary election, or 60 days of a general election. Any individual or group spending $1,000 or more per calendar year for such "electioneering communications" must report with the Secretary of State. The report must list the name, address, occupation, and employer of anyone contributing more than $250 to the electioneering communication and no contributions from corporations or labor organizations may be used. Similar prohibitions on corporate and labor organization funds are in place at the federal level for "electioneering communications" which unambiguously refer to any federal candidate for public office within 30 days of a primary election, or 60 days of a general election, although the federal law only applies to certain types of expenditures, direct mail, and broadcast communications.

The application of campaign finance and election law is often complicated and case-specific. At the law firm of Zakhem Atherton, we are strongly committed to helping our clients find creative and proactive solutions to their political questions, while helping them fully comply with all applicable federal, state, and local election and campaign finance laws.

If you are campaigning for elective office, are interested in starting or expanding the effectiveness of your political organization or committee, or otherwise seek to influence the political process, talk to the experienced election law team of Zakhem Atherton for skilled advice. Call or email our Denver office today for a free consultation with an experienced election law attorney.

*Note that the above-reference article and information is intended to be educational purposes only, and does not constitute legal advice upon which any person or third party may rely.