Raising the Roof
March 7, 2014
Michigan’s major new campaign finance law, PA 252 of 2013, doubles the limits on contributions to state candidate committees and the four state political action committees (PACs) that have contribution limits – the legislative caucuses’ PACs. There are no limits on contributions to the rest of Michigan’s PACs, superPACs, ballot committees or the political parties.
Raising contribution limits wasn’t unique to Michigan last year. We were one of nine states across the country that increased contribution limits substantially in 2013. In some states it was framed as a way to give candidates greater capacity to counteract independent spenders whose role has increased significantly since the Citizens United decision in 2010. In Michigan it was presented as “modernizing” campaign finance law. After all, proponents argued, if contribution limits had ratcheted up with the consumer price index since they were first set in the 1970s, they would have increased more than two-fold.
How much will this affect Michigan campaigns and elections? It remains to be seen, and the effects are likely to be very uneven. Not many Michiganders wrote checks to state candidates at the former limits, and it doesn’t automatically follow that all those who gave the old maximums will be doubling their contributions this year.
In the 2006 Granholm/DeVos campaign, the biggest gubernatorial spend-fest in state history, 1,508 Michiganders maxed-out at $3,400 – 1,002 to Gov. Granholm and 506 to Dick DeVos. The other 99.985 percent of us still had room to give more, if we’d wanted. Three hundred out-of-staters also gave the limit – 170 to Granholm, 130 to DeVos. Twenty state PACs made maximum contributions of $34,000 to Granholm. No state PACs made a maximum contribution to DeVos.
Just 817 Michiganders donated the maximum in the 2010 gubernatorial – 755 to Gov. Snyder and 62 to Virg Bernero. Four state PACs gave the limit to Bernero, while Snyder eschewed contributions from PACs. Once again, 99.99 percent of Michiganders had room to give more under the old limits. Raising contribution limits is a solution to a problem that most of us were not experiencing.
Some ardent supporters already have made contributions at the new maximum of $6,800 to this year’s gubernatorial candidates. At year-end reporting, there were about 30 to Gov. Snyder and about ten to Mark Schauer, even though the new limits had been signed into law just four days before books closed on 2013 giving. As a suggestion of the possible, if a candidate can find 1,000 donors to give the new maximum, he would raise $3.4 million more than he could have from those supporters under the old limits. We’ll have to see how many of our neighbors have been waiting for that opportunity.
While Michigan had the most expensive Supreme Court campaign in its history in 2012, and the most expensive in the nation for that election cycle, just 75 Michiganders hit the old contribution limit of $3,400. Just two PACs gave the $34,000 limit. One of those, Gov. Snyder’s One Tough Nerd PAC, gave $34,000 to each of the three Republican nominees.
The number of maximum donors to candidates for state senator under the old limits was similar to the number of maximum gubernatorial donors. Just 1,000 Michiganders gave the maximum contribution of $1,000 to a Senate candidate in 2010. That’s just one percent of one percent of Michiganders – one of every 10,000 of us.
Maximum PAC contributions to state senator candidates under the old limits also were scarce, unless you happened to be running in one of the eight or ten most competitive districts. Many current senators received no $10,000 PAC contributions in 2010. None received more than eleven, and most of the maximum PAC contributions came from officeholders’ leadership PACs, not interest groups.
The most maximum contributions under the old limits went to House candidates. That’s almost certainly a function of the lower limit: formerly $500. In 2012, 3,000 Michiganders gave the maximum amount to a representative candidate. Still, 99.97 percent of us had room to give more, if we’d wanted. The incidence of maximum PAC contributions to representative candidates was similar to that for senate candidates. Most were concentrated in the 12, or so, most competitive races. Many current representatives didn’t receive a maximum PAC contribution in 2012.
Leadership PACs is one category where the new contribution limits could have significant impact. Consider the possibilities for a hypothetical candidate to fill the position of Senate majority leader. If he can raise the money, he can establish three leadership PACs and support a prospective caucus-mate with $60,000 – $20,000 from each of his committees. Since there are no limits on contributions to PACs, just one supporter could feed all three of Sen. Hypothetical’s PACs with just one check, which could be redistributed among his three committees and donated to candidates. A candidate to fill a vacated caucus leadership post can win a lot of loyalty by providing that level of financial support. A super-donor who can provide that kind of fuel for leadership PACs can win consideration too.
There are a small number of individuals who really were constrained by the old limits, and they wanted to give more – in some cases, much more. The best example we’ve seen so far is the robust new support for the Republican legislative caucuses’ PACs by the DeVos family. Nine members of the family of Republican super-donors each gave the new annual limit of $40,000 to the Republican caucus PACs in the waning days of 2013. That is a windfall of $180,000 for the House Republican Campaign Committee and the Senate Republican Campaign Committee, just for starters. The DeVoses also have been prominent among a relatively small handful of political donors who contribute to a number of legislative candidates across the state, not just their own representatives.
The overwhelming majority of candidates who win elections have greater financial backing than their opponents. Doubling contribution limits undoubtedly will help some candidates raise more money. But since there are no limits on contributions to party committees or PACs (except the caucus PACs) and those committees can make unlimited independent expenditures, what has really changed? As the keeper of the checkbook for one major state PAC once told me, “You get more leverage when you give the money directly to the candidate.”
Finally, the more important feature of PA 252 of 2013 was the provision to protect anonymity for donors to party administrative accounts and nonprofit corporations. That is a topic for a future column.