[NOTE: Read the update below. It appears I was mostly wrong. My bad, but I own it.]
When Rep. Dave Reichert reported about $100,000 in illegal, excess contributions a couple weeks back, did he think nobody would notice?
I was skimming through Reichert’s quarterly FEC report, when I came upon something quite odd. The campaign contribution limit for House races this cycle is an aggregate $2,100 from individuals and $5,000 from PACs for each the primary and the general elections. And yet I found contribution after contribution in excess of those amounts.
In all, I found 47 individual contributions in excess of the $2,100 individual limit — as much as $4,700 each — and most of these individuals had given excess contributions for both the primary and the general elections. In addition, I found 9 PAC contributions apparently in excess of the $5,000 aggregate limit, including notable WA state business leaders like Microsoft, Boeing and Weyerhaeuser.
Add it all up and Reichert’s haul of excess contributions totals over $97,000. And that’s just from donors who contributed during the previous quarter… I’ve yet to go back to earlier reports to see if other donors had already exceeded their aggregate limit as well.
Of course, Reichert didn’t just solicit all this extra cash and figure the FEC wouldn’t notice. The PDFs of his itemized receipts include the following notation:
Limit Increased Due to Opponent’s
Spending (2 U.S.C. 441a(i)(441a-1)
Oh. So there’s an explanation. No biggie, I guess. Until you look up 441a-1 and find that this explanation is a load of shit.
What Reichert is referring to is something called the “Millionaires’ Amendment,” which allows candidates to exceed the normal contribution limits, under certain circumstances, when an opponent spends personal funds in excess of an established threshold. The FEC publishes a brochure, which clearly explains the provisions:
The provisions of the Millionaires’ Amendment may, in certain circumstances, increase the contribution limits for House and Senate candidates facing opponents who spend personal funds in excess of certain threshold amounts. […] For House candidates, the threshold amount is $350,000. 11 CFR 400.9(b). House candidates whose opponent’s personal spending exceeds that threshold may trigger increased limits.
Um… last time I checked, Darcy Burner had spent less than $47,000 of her own money to jumpstart her campaign — nowhere near the $350,000 threshold. And in any case, at the time Reichert started soliciting his excess contributions, Burner hadn’t yet reported $350,000 in total contributions, from any source.
And of course, the contribution limit increase doesn’t just come automatically; there is a process. Candidates are required to estimate in their Statement of Candidacy the amount of personal funds in excess of the threshold they intend to expend, and Burner’s statement estimates exactly $0.00. Furthermore, candidates are required to send a copy of Form 10 to both the FEC and their opponents within 24-hours of exceeding the threshold; of course, Burner has never filed such a form, because she’s more than $300,000 shy of the mark.
An opposing candidate’s campaign-related expenditures from personal funds in excess of the triggering threshold do not automatically result in increased contribution limits. The Millionaires’ Amendment also takes into account fundraising by the campaigns. Campaigns must use the “opposition personal funds amount” formula to determine whether an opposing candidate has spent sufficient personal funds in comparison to the amounts raised by the campaigns to trigger increased contribution limits
A candidate with a significant fundraising advantage over a self-financed opponent might not receive an increased contribution limit. In this way, the regulations avoid giving increased contribution limits to candidates whose campaigns have a significant fundraising advantage over their opponents.
Reichert has outraised Burner $1.4 million to $540,000 thus far… so I’m not sure the limit increase would have been triggered even if Burner had hit the threshold.
I’m no FEC expert, so maybe I’m missing something obvious here… but it’s hard to believe that the Reichert campaign itself actually believes that it qualifies for increased contribution limits under the Millionaires’ Amendment. So what could possibly explain this discrepancy?
Well, I suppose it could just be a mistake. Because donors don’t always understand the limits, campaigns inadvertently receive excess contributions all the time, and there’s a mechanism in place for returning them in a timely matter without penalty. But 56 contributions totaling nearly $100,000 in a single quarter? What’s the chance of that?
And, oh yeah… the vast majority of these excess contributions were recorded in the final couple weeks of the quarter, while all nine of the excess PAC contributions were recorded on March 31… the very last of the reporting period.
Coincidence? I think not.
Here’s what I think happened. The Reichert campaign got spooked by what they correctly perceived to be a late quarter fundraising surge by Burner, and so they booked tens of thousands of dollars in excess contributions during the final days — knowing that they would eventually have to refund the money — simply to make the fundraising gap look less embarrassing. The goal was to prevent Burner from gaining the credibility and momentum she had earned.
It didn’t work.
Diane Tebelius, Washington State GOP chairman, asked the FEC to look into alleged violations of federal campaign reporting laws including receipt of excessive contributions and failure to properly report disbursements.
This complaint paints a picture of a campaign that is unable to comply with federal election rules and regulations. Earlier this year Burner pledged to adhere to the highest ethical standards if elected to Congress. This latest revelation makes that pledge sound hollow. “Darcy Burner makes a mockery of her own pledge with her inability or unwillingness to follow even the most basic campaign finance rules,” commented Chairman Tebelius.
The GOP’s complaint was trivial and frivolous, centering on a video, legally produced by a volunteer. But if Tebelius wants to mock Burner for failing to report volunteer work she wasn’t required to report, what can we say about Reichert? His campaign not only failed to comply with federal election rules and regulations, it flouted them, apparently and intentionally soliciting nearly $100,000 in excess contributions, simply to gain a PR advantage.
Reichert wasn’t merely gaming the system… he was lying. And it gives us a good idea of what we can expect from his campaign from here on out.
As it turns out, it looks like I may have misunderstood the “Election Cycle to Date” field to refer to the election cycle to date, per election. Take a look at this section of the form, and you can see my confusion:
Hmm. Others have suggested this field may actually represent the aggregate across both elections, and looking at the way the numbers add up, I’m leaning in that direction. My bad.
So… the amount of the excess contributions may be much less than I had assumed. Two individuals who have contributed totals of $4,700 and $4,600 respectively (over the combined limit of $2,100) plus two PACs, Microsoft and Boeing, who have contributed an aggregate of $15,000 and $11,000 respective (over the combined limit of $10,000).
I guess I was so caught up in the bogus reference to the Millionaires’ Amendment, that I didn’t see the forest for the trees.
Sure, it’s embarrassing to get things like this wrong, but I’m man enough to admit it. So rather than delete the post, I’m leaving it up here for all to see my mistake and my correction. If anything, this is a great example of the self-correcting feature of blogging, when practiced honestly. This is a kind of open-source journalism, and any time I truly make a mistake, my readers are there to correct me and set the record straight.