Let's say you're a donor to a candidate or an elected official who quits a race mid-campaign or chooses not to run again. What if you made a contribution to one of the nine Texas legislators who decided not to seek reelection this year — to Plano's Brian McCall (who had nearly $542,000 in his campaign account, according to his latest filing with the Texas Ethics Commission), or Lubbock's Carl Isett (nearly $139,000), or San Antonio's Frank Corte (more than $123,000)? What if you gave to Tom Schieffer, the former Texas House member and American diplomat who campaigned as a prospective nominee for governor before deciding against running, or to Jack McDonald, the former tech executive who raised more than $805,000 while considering a challenge to U.S. Rep. Michael McCaul that he utimately thought better of? What happens to your money?
Almost-candidates and former officer-holders have wide latitude in how they can unload their campaign cash. The same rules apply to lawmakers who leave office and to abortive hopefuls. According to Texas campaign finance attorney Ed Shack, the only firm Thou Shalt Not is that candidates can’t dip into contributions for personal use (which is a narrowly proscribed territory, as shown by the Texas Ethics Commission’s recent approval of Sen. John Whitmire’s purchase of $90,000 in baseball tickets with campaign funds). Candidates must also clear campaign-associated accounts within six years after they get out of office or leave electoral politics, whichever is later.
As long as they make sure they're using contributions in a way that's related to serving in office or campaigning, the recipients of your cash have a few options. They can give it to their political parties, other candidates or political committees, charities, or to the state comptroller for deposit in the state treasury (though a spokesperson for the Comptroller’s office said they don’t have a record of that ever happening). As long as it's used for the express purpose of setting up or helping a scholarship program, candidates can even donate to schools or colleges. State candidates can also opt to refund contributions to donors; the only limit is that they can’t reimburse more money to a donor than that donor contributed during the past two years.
Cliff Johnson, who left the Texas House in 1988 after two terms, said he gave his residual cash to legislators he served with. Johnson said the main motivation for disbursing money this way was to reward past loyalty. “No real advantage other than [giving it] to like-minded folks, people whose vote you counted on when you were a House member or Senate member, the people who kind of hung with you on difficult votes,” Johnson said.
Former lawmakers can use campaign contributions to ensure future loyalty, too. Nothing in the Texas Election Code precludes lawmakers who follow the well-trod path from the Capitol into a lobby shop from handing money left in their accounts to former colleagues they’re now pressing on behalf of clients.
This can create a group of so-called super-lobbyists who not only use their past relationships with former colleagues to gain access to legislators but also deploy “mad money” to gain supportive ears, said Andy Wilson, a campaign finance researcher with Public Citizen’s Texas office: “Essentially you are doubling down on a single lobbyist who has not only a collegial relationship but also a generally large campaign war chest that he can dole out.”
The rules aren't much different for federal candidates. Take McDonald, who decided against running for Congress. He could, like his state counterparts, send unspent campaign dollars to his political party, a charity, other federal and state candidates or PACs, or back to donors under Federal Election Commission rules. Like the TEC, the FEC also bans personal use of campaign money.
Texans who either drop out of federal races or give up their U.S. House or Senate seats and decide they want to donate to remaining campaign sums to other federal candidates, office-holders, or PACs, have to follow the FEC’s campaign committee limits. That means any donation would be capped at $2,400 for an individual candidate and $5,000 for other political committees. If they wanted to give money to a state candidate or PAC, federal law says that’s fine as long as it complies with state regulations, which in Texas is easy because the state doesn’t limit contribution amounts.
McDonald said in an e-mail that he will return all contributions to donors who want their money back, even if that means opening up his personal pocketbook to refund money already spent by his campaign. Since he didn’t compete in a general election camapign, federal law says he has to return any cash in his general election account anyway. But the majority of McDonald’s money is in his primary account, so he is doing his donors a favor, because he could spend that money in any way he wants within FEC Rules. It doesn’t matter that he never filed for the primary; according to Paul Ryan, an attorney at the Washington, D.C.-based Campaign Legal Center, federal law considers a person a “candidate” as soon as he publically announces he's running for office or when he raises more than $5,000 in contributions.
And as the Tribune has previously reported, if a federal office-holder follows U.S. Sen. Kay Bailey Hutchison’s lead and decides to run for state office, she can still use money she’s raised for past federal races to campaign on the state level. Candidates like Bill White, who switch from a federal race to a state race, can spend what they’ve raised for the federal race under Texas law as long as they abide by the FEC rule about returning money to donors if it’s tagged for a general election they haven’t entered.
Unlike McDonald, Schieffer said he doesn't have anything to refund: "I've pretty well spent it." McCall, Isett, and Corte said they weren’t sure how they’d spend their remaining contributions. Former Rep. Cliff Johnson’s advice: “Just make damn sure you know what the law says.”