state board of elections

6400 Mail Service Center ● Raleigh, NC 27699-6400

 

 

GARY O. BARLETT                                                                                                                          Mailing Address

Director                                                                                                                                                  PO Box 27255

                                                                                                                                                                Raleigh, NC 27611-7255

                                                                                                                                                                (919) 733-7173

                                                                                                                                                                Fax (919) 715-1035

 

July 26, 2001

 

Ms. Glenda Clendenin, Director

Moore County Board of Elections

PO Box 787

Carthage, NC 28327

 

Re: Your July 3, 2001 request for an opinion

 

Dear Ms. Clendenin:

 

This letter contains an opinion of this office pursuant to GS 163-278.23.

 

The answer to your first question is that it is permissible for a PAC to organize for the sole purpose of supporting a candidate. The fact that there is a candidate's committee already formed is not relevant.

 

A PAC can only contribute up to $4000 per election to a candidate. An election is considered as a primary, second primary (if on the ballot), a run-off election, and an election to fill a vacancy, and a general election. (See GS 163.278.6(8)) So it is possible to give up to $12,000 to a candidate goes through a primary, second primary, and a general election.

 

As to your question about possible in-kind contributions when a PAC makes expenditures for a candidate, the expenditure aren't treated as in-kind if they are independent expenditures. However if the expenditures were coordinated, those expenditures from a PAC, even one controlled by a candidate or a group of candidates, must be shown in-kind on the one or more of candidate's committee report.  A coordinated expenditure benefiting more than one candidate will have to reported in-kind on each benefited candidate's report and properly noted in the PAC report.

 

It is permissible for a candidate to allow a PAC to handle campaign activities as long as the contributions and expenditures are fully reported. However, the $4,000 contribution limitation would apply.

 

If expenditures and other campaign efforts by a PAC, group, or individuals benefit a candidate, and are performed in coordination with that candidate's campaign, then those expenditures will be counted toward the $4,000 contribution limit. In other words, a person or PAC could not spend $3,000 on a coordinated mailing for a candidate and then contribute $4,000 on top of that. The later contribution would be limited to $1,000 the remaining balance of the $4,000 contribution limits after the $3,000 coordinated mailing.  If the PAC makes an expenditure that benefits more than one candidate, then the coordinated expenditure is offset against the $4,000 contribution limitation of each candidate benefited. So if the mailing referred to above supports three candidates, then $3000 is offset against the $4,000 limit that the PAC may give each of the three candidates. Again, the reporting requirements will mandate that each of the candidates reports must show this as a contribution and the PAC report must show it as an expenditure benefiting more than one candidate.

 

Expenditures by PACs, groups, or persons that may benefit a candidate, but are not done in coordination with that candidate's campaign are independent expenditures and not subject to the $4,000 contribution limit. However, GS 163-278.12 requires the reporting of independent expenditures in excess of $100. The general prohibition against campaign contributions by corporations and business entities would apply to coordinated expenditures and independent expenditures.

 

Who determines what is coordinated or independent? The elections office in which the campaign must file its reports determines the issue, and this issue must be studied on a case by case basis. As a general rule, in order to find coordinated expenditures, there must have been some prior communication between the provider of the expenditure and the candidate. For instance, a citizen sends a candidate a print ad he plans to run to a candidate, asking for the candidate's review of the ad. The candidate makes a change in the ad, and sends it back. That has become a coordinated expenditure. But if the candidate received the unsolicited ad for review and does nothing, then if the ad is run, it continues to be an independent expenditure.  If a county office has questions or concerns on these type issues, the State Board of Elections office will offer advice upon request.

 

Based upon recent court decisions involving our office, it appears that groups that deal with issue advocacy and do not expressly ask voters to or not to "vote" or "support" a candidate, are not considered PACs and do not have to file as a PAC or report their activities. Again, this office would be more than happy to consider any situation that might present itself to your office.

 

                                                                                                Sincerely,

 

 

                                                                                                Gary O. Bartlett

                                                                                                Executive Secretary-Director