Supreme Court Strikes Down Federal Limits On Coordinated Party Expenditures

Summary

The Upshot

• The Court removed the limits on the amount that party committees can spend on coordinated expenditures with their federal candidates.
• The opinion does not remove the existing contribution limits on individuals and political action committees, nor does it change the coordinated expenditure restrictions on outside groups. Thus, Super PACs, 501(c)(4)s, and other outside groups remain subject to the strict prohibition on coordinating with federal candidates and party committees.
• The Court now recognizes only one legitimate governmental interest for restricting campaign finances: preventing quid pro quo corruption. Whether and how this ruling may apply to state-level campaign finance limits will depend on how those laws are structured. The party coordinated limits were a unique facet of federal campaign finance law, and most states do not have analogous provisions.

The Bottom Line

The Court removed the coordinated expenditure limit for party committee spending on federal candidates. Under FECA, party committees could coordinate with their candidates, but only up to a limit—which varied in amount based on the candidate’s state and office. In prior precedent in Colorado II, the Court upheld these limits, reasoning that the restriction was Constitutional to “minimize circumvention of [individual] contribution limits.” In other words, the limitation properly addressed Congress’s concern that individual donors would make large contributions to party committees, direct the contribution to a particular candidate, and effectively circumvent the lower individual contribution limit.

The Court rejected its prior holding, reasoning that First Amendment jurisprudence has evolved significantly since the Colorado II opinion. Today, the Court opined, the only legitimate governmental interest Congress may have in imposing campaign finance restrictions is to prevent quid pro quo corruption. The Court reasoned that contributions to political parties do not carry the same risk of quid pro quo corruption as direct contributions to candidates because political parties are independent actors between contributors and candidate committees (thus suggesting that the Court may not be ready to overturn Buckley v. Valeo and contribution limits in general). The Court further reasoned that existing earmarking and disclosure rules are adequate to prevent any of the circumvention concerns raised in Colorado II. Considering these rules, the Court found that FECA’s limit on federal political party coordinated expenditures improperly burdened free speech without a valid justification, holding the limits were unconstitutional.

Importantly, the opinion only removes the limit for political parties. It does not remove any other contribution limits, such as those on individuals and political action committees. The Court also did not remove coordination rules for outside groups. Thus, Super PACs, 501(c)(4)s, and other outside groups that engage in independent expenditure activities remain subject to the strict prohibition on coordinating with federal candidates and party committees, and hard-dollar “traditional” PACs are subject to contribution limits with respect to their coordinated in-kind activities. This ruling does not mark the end of contribution limits in general, nor is it as monumental as the 2010 Citizens United decision that, along with SpeechNow, opened the floodgates of independent expenditure activity. Rather, this decision is one more hammer tap in a progression of rulings chipping away at the federal campaign finance laws.

Despite the narrow scope of this decision, voters are likely to feel the impact of this ruling immediately, with midterm races in full swing. At base, party committees are likely to devote more resources to coordinated advertising, messaging, and other campaign activities on behalf of federal candidates; and likewise, federal candidates will shift to rely more heavily on the parties for coordinated campaign support. There may be a swing for donors away from outside spending, such as Super PACs and other entities which are still subject to anti-coordination rules, and an emphasis on the more targeted funding power of political parties. That said, contributions to party committees from individual donors and PACs are still subject to contribution limits and contributions from corporations, nonprofit organizations, and Super PACs to party committee coordinated accounts remain prohibited. Whether this decision shifts money away from independent expenditures or just increases the overall amount of money in elections remains to be seen.

Finally, whether and how this ruling may apply to state-level campaign finance limits will depend on how those laws are structured. The party coordinated limits were a unique facet of federal campaign finance law, and most states do not have analogous provisions that would appear to be immediately implicated by this ruling.

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