As Super PACs and campaigns continue to edge closer to the legal line between “independence” and “coordination,” it has become common to hear calls for the FEC to take a stricter role in enforcing the law. Yet as recently reported by BNA, the FEC has not found a single violation of its coordination rules in the past five years. A recent case before the California Fair Political Practices Commission (“FPPC”) provides a sharp contrast.

At its August 20 meeting, the FPPC entered into an agreement with state senate candidate Joe Coto, his campaign committee, and Vote Matters, a state political committee in which the three admitted to making and receiving excessive contributions and related reporting violations, and agreed to pay a total of $16,000 in penalties. The FPPC alleged, and the parties agreed, that Vote Matters made an illegal contribution of over $110,000 to the Coto campaign after it hired two individuals who had run the campaign’s field operation and had them provide similar services for the independent expenditure program.

The FPPC concluded that state law created a presumption of coordination when former staffers worked for an independent expenditure program in the same cycle as the campaign, and that Vote Matters had not rebutted that presumption. As a result, both the Vote Matters field operation (which the two former staffers ran) and the group’s direct mail operation (which they were not involved with) were treated as contributions to the campaign that far exceeded the $3,900 contribution limit. Even though the FPPC found no evidence the Coto campaign authorized or was aware of its former staffers’ activities, it concluded that the expenditures were sufficiently large that the campaign “should have been aware” of them and found it had received an excessive contribution. Because Vote Matters reported the costs of its mailers and field operation as an independent expenditure rather than a contribution, and the campaign never reported receiving the excessive contribution, all parties were also assessed penalties for reporting violations.

This case is an important reminder that some state campaign finance agencies are aggressively enforcing the coordination rules, and that coordination can occur without explicit agreement between the parties.

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Photo of Robert Lenhard Robert Lenhard

Robert Lenhard is a member of the firm’s Election & Political Law practice group and advises corporations, trade associations, not-for-profit organizations, and high-net-worth individuals on compliance with federal and state campaign finance, lobbying, and government ethics laws.

Mr. Lenhard routinely assists clients in…

Robert Lenhard is a member of the firm’s Election & Political Law practice group and advises corporations, trade associations, not-for-profit organizations, and high-net-worth individuals on compliance with federal and state campaign finance, lobbying, and government ethics laws.

Mr. Lenhard routinely assists clients in establishing and operating federal and state PACs, compliance programs associated with campaign finance and pay-to-play laws; advises advocacy groups and their donors; conducts compliance trainings and audits of federal and state lobbying and political programs; and counsels clients on compliance with congressional gift and travel rules.

Prior to joining the firm in 2008, Mr. Lenhard served as Chairman of the Federal Election Commission (FEC) in 2007 and Vice Chairman of the agency in 2006, during which time the agency handled over 10 major rulemakings, had among its most productive years in enforcement and audit, and adopted several reforms to the enforcement process.  Mr. Lenhard has also led the Presidential Transition Team that reviewed the FEC for the incoming Obama administration in 2008-2009.

Photo of Andrew Garrahan Andrew Garrahan

Andrew Garrahan represents and counsels clients at the intersection of law and politics. He guides them through both regulatory compliance issues and government investigations on matters including state and federal campaign finance, ethics, lobbying, and corruption.

Mr. Garrahan’s prior career in political fundraising…

Andrew Garrahan represents and counsels clients at the intersection of law and politics. He guides them through both regulatory compliance issues and government investigations on matters including state and federal campaign finance, ethics, lobbying, and corruption.

Mr. Garrahan’s prior career in political fundraising gives him a unique perspective on the challenges faced by his clients, which include corporations, candidates, government officials, political and nonprofit organizations, and private individuals.

Mr. Garrahan is a member of the Virginia and District of Columbia bars.