House Bill 633-Limit Contributions From Political Parties

From North Carolina FreeEnterprise Foundation (NCFEF):

Pardon for the long quote but I did not have a url.

About the Capital- Bill Would Clamp Down on Party Funding
NCFEF News - April 7, 2011:
A bill introduced in the North Carolina General Assembly this week would curtail huge money transfers from political candidates to state political parties, and likewise, from the parties to political candidates. House Bill 633-Limit Contributions From Political Parties would extend to the executive committees of state political parties the $4,000 campaign contribution limit that currently applies to individuals, Political Action Committees (PACs) and campaign committees. This means the parties could neither receive from nor give to any political candidate more than $4,000 per election cycle. Such a change could dramatically influence the manner in which campaign funds are collected and distributed by political parties in North Carolina, especially in state legislative races.

In 2010, the State Democratic and Republican Parties operated on a much more level playing field financially than in years past. During the 2009-2010 election cycle, the State Democratic Party raised $7.6 million and spent just shy of $8 million, while the State Republican Party raised and spent slightly more than $6 million. Overall, the Democratic Party raised $1.27 for every dollar collected by the Republican Party and spent $1.32 for every dollar expended by the State GOP. For comparison purposes - albeit in a very different election year - the State Democratic Party enjoyed a $4 to $1 fundraising and spending advantage over their Republican counterparts in 2008.

Considering the relative parity in money raised and spent by both major political parties during the last election cycle, it is interesting to examine where substantial portions of that money came from and how it was distributed, as well as how these activities would be impacted should HB 633 be enacted into law.

In the month leading up to the November 2, 2010 General Election, the State Democratic Party received substantial contributions from a number of well-heeled state legislative campaign committees. Most notably, former Senate President Pro Tempore Marc Basnight (D-Dare) contributed over $720,000 to the party between October 1, 2010 and November 2, 2010. Former Speaker of the House Joe Hackney (D-Orange) gave the party $252,000 during the same time period. In addition, at least eight other Democratic state lawmakers transferred over $50,000 from their campaign committees to the state party in October, including Rep. Pricey Harrison (D-Guilford), a co-sponsor of HB 633.

The Republican Party engaged in similar activities. Current Senate President Pro Tempore Phil Berger (R-Rockingham) dropped $305,000 in the State GOP coffers in the month leading up to the general election, and current Speaker of the House Thom Tillis (R-Mecklenburg) gave over $160,000. At least eleven other Republican state legislative candidates contributed $50,000 or more to the party from their campaign accounts in October 2010.

Although candidates may presently give unlimited amounts of campaign cash to a state political party, they are legally prohibited from specifying how the party spends those funds, and the parties employed different strategies in 2010. Generally speaking, the Democratic Party utilized a "rifle" approach, dolling out high dollar contributions to a relatively small number of candidates. In fact, in October alone, the party gave over $50,000 to at least eleven of its state legislative candidates, and five of those received well into six-figures. Incumbent Senators Tony Foriest (D-Alamance), Joe Sam Queen (D-Haywood) and John Snow (D-Cherokee) all received over $200,000 from the party only to lose their seats on November 2.

In contrast, the Republican Party exercised more of a "shotgun" method, spreading out most of their direct contributions in smaller amounts among a broader range of candidates. In addition, a significant portion of the GOP's spending was through in-kind contributions, as opposed to handing over proverbial buckets of cash directly to the candidates. No doubt, this enabled the party to maintain more control over campaign spending and ensure a consistent approach and messaging across campaigns. Nonetheless, five GOP legislative candidates benefitted from over $100,000 in spending from the party and at least another three received over $50,000 in the four weeks prior to the election.

It will be a fascinating thing to watch if House Bill 633 gains traction in the General Assembly. The bill has some prominent Republican primary co-sponsors including Reps. Bill Current (R-Gaston), Marilyn Avila (R-Wake) and John Blust (R-Guilford), in addition to the aforementioned Democratic Rep. Pricey Harrison.

Considering the historic flow of money from the candidates to the state political parties (particularly from those holding major posts within the legislative leadership), and conversely, from the political parties to the candidates (particularly to those candidates in the most hotly contested races), House Bill 633 would fundamentally change the way many political campaigns are funded in North Carolina. No longer would state political leaders have the ability to collect huge sums of money and hand it over to their parties in unlimited amounts, and no longer would the parties be able to dump huge cash deposits into the campaigns of their most vulnerable candidates.

House Bill 633 would be like tightening a clamp around a fire hose until just a trickle drips out, but we have all observed in the world of politics how money, like water, always seems to find a way to get to where it is going.

This would really make things interesting in light of Citizens United.