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Incumbents Set to Gain Millions in Campaign Cash from Leadership PAC Proposal to be Voted on this Week in Senate

Sept. 14, 2005

Incumbents Set to Gain Millions in Campaign Cash from Leadership PAC Proposal to be Voted on this Week in Senate

Analysis Shows Overall Campaign Funds Could Increase by 20 Percent; Sponsors Frist and McConnell Would Reap an Even Bigger Windfall

WASHINGTON, D.C. – An analysis by Public Citizen shows that incumbent officeholders stand to dramatically boost their campaign fundraising prowess at the expense of challengers under a little-noticed provision inserted into an unrelated appropriations bill scheduled for Senate floor action as early as Thursday. By eliminating limits on contributions that “Leadership PACs” can make to political parties, officeholders could take advantage of two separate campaign fundraising committees rather than the single campaign committee available to challengers.

The measure, sponsored by Senate leaders Bill Frist (R-Tenn.) and Majority Whip Mitch McConnell (R-KYy.), would overturn a to remove the post-Watergate campaign finance limit and give a huge advantage to incumbents over their challengers, who are not permitted to establish Leadership PACs. It also effectively would dramatically increase the amount that individuals and special interest PACs can contribute to the campaigns of incumbents.

Public Citizen’s analysis shows that incumbent senators, who run for re-election every six years, could use unlimited transfers from Leadership PACs to boost their campaign fundraising by at least 20 percent – and probably much more. The 57 Leadership PACs run by sitting senators raised a total of $80 million during the 2000, 2002 and 2004 elections. They spent a total of $404.1 million on their races during that period. If the Frist-McConnell proposal had been law during that period, that $80 million could have been transferred to the political parties and spent to support these incumbents or to oppose their challengers.

To see the analysis of Leadership PAC funds for the Senate during the 2000 to 2004 election cycles, click here.

“This scheme is nothing but an incumbent protection act whose ramifications are breath-taking,” said Public Citizen President Joan Claybrook. “Eliminating the cap on Leadership PACs would provide officeholders with a huge slush fund that would allow them to launder money through the parties for their own benefit.”

Leadership PACs, which can be created by any member of Congress, are a special – and legally questionable – class of political committees. They are not codified in federal law. Nevertheless, federal elections officials have allowed them as a means to help pay for duties associated with serving in Congress, such as travel for speechmaking, and to make limited contributions to other candidates and party committees, in the amount of $5,000 per election and $15,000 per year respectively. These funds are not supposed to be used to promote the candidacy of the officeholder who operates the Leadership PAC. But political parties are free to spend funds on behalf of the incumbent who transfers the money to them.

The Frist-McConnell proposal would allow wealthy special interests to have even more influence over lawmakers. Currently, candidates may receive up to $4,200 per election cycle (primary and general) from individual contributors to pay for their campaigns. Individuals and PACs may also give an additional $5,000 per year to an officeholder’s Leadership PAC. 

Under Frist-McConnell, individuals effectively would be able to contribute $34,200 to support a lawmaker’s campaign, or eight times more to support their candidacy than they can now – the $4,200 that can be directly contributed to a senator’s campaign and another $30,000 ($5,000 per year during a senator’s six-year term) to his Leadership PAC. Similarly, corporate and union PACs effectively would be able to increase their giving to an incumbent fourfold – from the current $10,000 per election cycle to $40,000.

Frist, the second most prolific Leadership PAC fundraiser in the Senate, raised $6.1 million over the past six years for his Leadership PAC and spent $7.5 million on his re-election. Having the ability to transfer the $6.1 million in his Leadership PAC would have amounted to an 80 percent increase in the funds he could have raised to support his candidacy. Similarly, McConnell’s leadership PAC raised $2 million, and he spent $5.7 million to get re-elected. His Leadership PAC money could have increased his campaign funds by 34 percent. 

“In all likelihood, the funneling of campaign cash from Leadership PACs to the party committees would turn into a flood,” said Craig Holman, legislative representative for Public Citizen. “Officeholders would be free to turn these committees into second fundraising operations, giving them an unfair advantage over challengers.”

  Sens. John McCain (R-Ariz.) and Russ Feingold (D-Wisc.) will introduce an amendment to strip the Frist-McConnell proposal from the transportation appropriations bill.