Federal Election Commission should act to close loophole exposed by billionaire Michael Bloomberg

Issue One Executive Director Meredith McGehee today commended the Federal Election Commission (FEC) for opening the door to consideration of a potential new rulemaking that could limit the amount of leftover campaign funds a candidate who self-funded their campaign could legally transfer to national party committees.

“If the FEC does not take action to close this loophole, it’s virtually guaranteed that we’ll see more affluent individuals embrace this maneuver. Wealthy people should not be allowed to evade campaign contribution limits by self-funding campaigns and then transferring large sums to political parties. The actions by former presidential candidate Michael Bloomberg  demonstrate why this is not just a hypothetical and why the FEC should commit to addressing this issue in a timely fashion. Inaction will encourage wealthy Americans to form and self-fund candidate committees simply for the purpose of transferring funds to the parties,” McGehee said.

Background:

Today’s action by the FEC — at its first public meeting since it lost its quorum in August 2019 — was prompted by the conservative advocacy group Citizens United, which asked the commission to clarify the rules regarding transfers of leftover campaign funds. The public now has roughly 60 days to comment about this issue. Then, the FEC will consider the merits of the petition and decide whether to begin an official rulemaking proceeding. 

Currently, there are no limits on how much money a candidate’s official campaign committee can transfer to a national party committee. Concerns about unlimited transfers arose after billionaire Michael Bloomberg transferred $18 million in leftover campaign funds to the Democratic National Committee — money that all initially came from his personal funds. In March, two groups filed complaints alleging that Bloomberg illegally contributed more than the legal limit to the DNC with his $18 million transfer.

By law, an individual may contribute up to $355,500 per year to the Democratic National Committee or Republican National Committee, including no more than $35,500 to the party’s main account and up to $106,500 apiece to three separate accounts for the party’s convention, its headquarters/buildings, and legal expenses/recounts.