Windfall For State Ballot Measure Committees

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Last week the FEC issued Advisory Opinion 2024-05 that could be a game-changer for state ballot measure committees.
United States Government, Public Sector
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Last week the FEC issued Advisory Opinion 2024-05 that could be a game-changer for state ballot measure committees. The opinion held that a federal candidate is permitted to contribute to a state ballot measure committee and related 501(c)(4) at any time without regard to contribution limits set by FECA ("Act"). This could result in a significant influx of cash for state committees on issues that are the hotbed of the November election.

The Nevadans for Reproductive Freedom (NFRF) maintains two entities engaged in gathering signatures to get a state constitutional initiative on the 2024 general election ballot: NFRF PAC and a related 501(c)(4) organization. The question presented is "may a federal candidate or officeholder solicit funds for NFRF (c)(4) and NFRF PAC, without regard to limitations or source restrictions both before and after the initiative qualifies for the 2024 general election ballot?" The answer was a minimally qualified "yes."

One of the gatekeeping questions was whether a contribution to NFRF's ballot measure activities is for an "election." "Election" is limited to an individual seeking office under the regulatory and statutory definitions under the Act. The NFRF proposed solicitations by candidates and officeholders in support of the ballot initiative which are not in connection with any "election," for federal office of otherwise, and thus are not restricted. The distinction between a ballot initiative and election is also supported by the Supreme Court's opinion that FECA only applies to candidate elections and not referenda or issue-based ballot measures.

Contributions to the (c)(4) are permissible because the organization's principal purpose is to advocate for the ballot measure. It will solicit federal candidates and officeholders for general support of the organization's mission and not for any specific purpose. Given this, it does not violate the Act, which excludes restrictions on certain solicitations by non-profits as long as the solicitation does not specify how the funds will be spent.

This opinion puts state ballot measure committees in the position of soliciting and receiving significant amounts of funds from federal candidates and officeholders before the November election on major issues.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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