What Counts as Legitimate Campaign Spending?
Political campaigning doesn’t begin or end with fundraising. However, having enough money to run an efficient, competitive race is essential. Given the rules and various sources of campaign funding, it’s important that candidates follow FEC regulations about where their campaign financing originates and how the money is spent.
Understanding what constitutes legitimate campaign spending is crucial, especially for independent candidates running for office at the state and local levels. Read on as we discuss campaign spending and provide clarity on what you can consider as a legitimate expense for your political campaign.
The Basics of Campaign Finance
Before diving into the specifics, it's essential to grasp the basic principles of campaign finance. Campaign finance laws are designed to ensure transparency and fairness in the electoral process. They regulate the amount of money that can be raised and spent as well as how campaign expenditure reporting is mandated by the appropriate regulatory bodies.
Campaign contributions can be divided into two categories, hard money and soft money. Hard money is the traditional campaign spending that’s directly donated to a candidate and related to an election. All donors must be disclosed and donations made within legal guidelines.
Soft money, which falls under the category of “outside spending,” is money spent on activities on behalf of a campaign. This money can come from any number of individuals or groups, and there are no limits on the amount that can be spent. However, any funds given directly to a candidate or campaign must be reported.
For independent candidates, navigating these laws can be a daunting task. But making sure that everything is done with transparency and accountability is fundamental to running a successful and lawful campaign.
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Legitimate Campaign Expenses
Campaign expenses can broadly be categorized into several key areas. Understanding these categories can help independent candidates plan their budget and make the most of limited campaign funds.
Understanding legitimate campaign expenses and avoiding even the hint of impropriety will help to ensure compliance with legal requirements and optimize your campaign strategy.
Here are ten of the most common campaign expenses:
Staffing Costs: Staff are the backbone of any campaign. Salaries, wages, and benefits for campaign staff are legitimate campaign expenses. This includes campaign managers, strategists, finance officers, and grassroots organizers.
Office Expenses: Renting office space for your campaign headquarters, utilities, office supplies, and equipment rental are all necessary expenses for running a campaign. These operational costs support the day-to-day functioning of your campaign.
Travel Expenses: Campaigning often requires travel. Expenses related to travel, including airfare, lodging, car rentals, and mileage for personal vehicle use, are considered legitimate, provided they are strictly for campaign purposes. Make sure to get and keep receipts for anything spent on the road while you’re campaigning.
Advertising and Promotional Materials: A significant portion of a campaign's budget typically goes to advertising. This includes traditional media ads (including TV, radio, and print advertising), digital advertising (like social media and email campaigns), and promotional materials (flyers, posters, and yard signs). These expenses are crucial for raising awareness and communicating your message to voters.
Event Expenses: Hosting political rallies, town hall meetings, fundraisers, and other campaign-related events can be costly. Venue rental, event production, security, and catering are legitimate expenses that contribute to engaging with voters and fundraising efforts.
Professional Services: Campaigns often require the expertise of political consultants, lawyers, accountants, and other professionals. Fees for these services are legitimate expenses that are essential for strategic planning, legal compliance, and financial management.
Technology and Software: In today's digital age, investing in technology and software for data management, cybersecurity, communication tools, and digital marketing is indispensable for an efficient campaign.
Campaign Materials: Besides promotional materials, expenses for creating and distributing campaign literature, policy documents, and voter education materials are legitimate and vital for informing the electorate about your platform.
Postage and Shipping: The costs associated with mailing campaign materials, merchandise, or correspondence are legitimate expenses. This includes postage costs for direct mail campaigns, one of the most traditional forms of voter outreach.
Fees and Permits: Various fees, such as filing fees to appear on the ballot and permits for event spaces or advertising, count as necessary expenses for a campaign.
Keep in mind that no campaign funds can be used for the personal benefit of a candidate, their family members, or any individual or organization associated with the campaign, even if it is “borrowed” temporarily and replaced.
The Federal Election Commission (FEC) furthers this distinction by placing campaign spending under an “irrespective test.” That means any financial obligation that would exist regardless of a campaign’s existence is considered a personal expense and is, therefore, not legitimate campaign spending.
Understanding Compliance and Reporting
The Fair Political Practices Commission (FPPC) has created a set of guidelines for what are considered legitimate campaign expenses. For example, any personal funds used for the campaign must be deposited into the campaign bank account. Volunteers may use personal funds for their campaign-related activities, but they must provide adequate proof of use and be reimbursed from the campaign bank account within 45 days.
Vehicle purchases of leases for legitimate campaign activities, like traveling to and from events or on the campaign trail, must be held by the campaign committee. Lessees or title holders cannot be the candidate, their family members, or other individuals or entities, even those who are directly associated with the campaign.
Legal expenses are legitimate, but only if they are related directly to campaigning or for election activities like:
Defending or halting defamation during a campaign
Defending against allegations of campaign funding misuse
Challenging ballot access
Contested elections and recounts
Compliance expenses, such as reporting fees of creating campaign finance reports
Compliance with campaign finance laws is not optional; it's mandatory. Keeping meticulous records of all campaign expenses is crucial for reporting to the relevant electoral or campaign finance authorities. This transparency not only ensures compliance but also builds trust with your supporters.
Best Practices for Managing Campaign Spending
Budgeting Wisely
Given the wide range of legitimate campaign expenses, effective budget management is essential. Prioritizing spending according to your campaign strategy, audience reach, and fundraising capacity is key to allocating resources wisely. Always plan for contingencies and monitor your spending closely to stay within legal limits and financial constraints.
Seeking Guidance
Navigating campaign finance laws and managing campaign expenses can be complex, particularly for independent candidates without the backing of a major party. Seeking advice from experienced campaign finance attorneys or consultants is advisable to avoid pitfalls and ensure compliance.
Connecting with Campaign Resources
Understanding what counts as legitimate campaign spending is foundational to running an effective and compliant campaign. By familiarizing yourself with the types of expenses you're likely to encounter and adhering to campaign finance laws, you can navigate the complexities of campaign finance with confidence.
Remember, the goal is not just to run an inspirational campaign, but to do so in a way that’s transparent, responsible, and ultimately successful in connecting with voters.
Independent, non-partisan, and third-party candidates can get access to free campaign resources through GoodParty.org, including free consultations about campaign finance and other areas of political campaigning. Ready to get the support you need to run an effective and efficient campaign? Book a meeting with our team today.
Photo by Jorge Salvador on Unsplash
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Frequently Asked Questions
