Leftover Campaign Funds are Useful Even After the Election

by Bob Lackner

With the start of the legislative session, the memory of your months of electioneering are beginning to fade, but there is one continuing, nagging concern: What to do about the leftover money in the campaign account? You may be worried about the legal consequences of possessing these moneys and confused about what, if anything, you can do with the money. This article gives guidance to legislators in answering these questions.

Unexpended campaign contributions are treated as political party contributions for the next election cycle
By way of terminology, in the arcane world of campaign finance law, these leftover moneys are called “unexpended campaign contributions” and their use is governed by provisions of the Colorado constitution and state statutory provisions.

An important principle to keep in mind following any general election is that unexpended campaign contributions held by a member-elect’s candidate committee are treated as political party contributions for contribution limit purposes. What does this mean? This means that the amount of unexpended campaign contributions held by a Senator-elect or Representative-elect candidate committee on the first day of the next election cycle are treated as contributions from a political party, regardless of the original source of the moneys, for purposes of the limit on political party contributions in that next election cycle. In that respect, by operation of law all unexpended contributions convert or are “morphed” into political party contributions.

The 2014 election cycle began on December 7, 2012. So, any unexpended campaign contributions that a legislator-elect held after midnight on December 6, 2012, are treated as a political party contribution in the 2014 election cycle.

The amount of unexpended campaign contributions on hand affects the amount of political party contributions a legislator’s candidate committee may accept in the next election cycle.
The amount of political party contributions a legislator may accept in the new election cycle depends on the amount of his or her unexpended campaign contributions on the first day of the new election cycle. The amount of political party contributions a legislator may accept in the new cycle is the limit set in the state constitution as adjusted for inflation —  $20,500 for senators and $14,805 for representatives — minus the unexpended campaign contributions in the legislator’s candidate committee account at the end of the old election cycle.

For example, Representative Helton’s candidate committee had $9,805 in unexpended campaign contributions on the first day of the new election cycle. Her committee may accept up to $5,000 ($14,805 – $9,805) in political party contributions in the new (or 2014) election cycle. If her committee accepts more than $5,000 in political party contributions in the new election cycle, it will violate the campaign finance law.

The acceptable uses of unexpended campaign contributions.
Section 1-45-106 (1) (b), C.R.S., sets out the ways that a legislator can use unexpended campaign contributions. These uses include “[a]ny expenses that are directly related to such person’s official duties as an elected official….” The statute provides a long list of examples of how a legislator can use this money, including purchasing or leasing office equipment and supplies; renting rooms for public meetings; paying necessary travel and lodging expenses for legislative education programs, including seminars, conferences, and meetings on legislative issues; and telephone and pager expenses. A frequently asked question is whether a legislator can use these moneys to hire legislative aides to help him or her with official duties. The OLLS has opined that, consistent with the statute, hiring aides is an acceptable use of unexpended campaign contributions.

Disclosing the use of unexpended campaign contributions
In connection with the 2012 election cycle and the 2014 election cycle that started December 7, 2012, a candidate had to disclose any expenditures donated or used between October 25, 2012, and November 30, 2012, on the regular report of contributions and expenditures that candidates are required to file 30 days after the major election, or on or before December 6, 2012. See section 1-45-108 (2) (a) (I) (E), C.R.S. Each legislator should have disclosed any expenditures donated or used between December 1 and December 6 on the subsequent regular report of contributions and expenditures that must be filed quarterly in off-election years, or on or before January 15, 2013. See section 1-45-108 (2) (a) (I) (A), C.R.S. A legislator must disclose any additional expenditures made after December 6, 2012, in accordance with the timetable for reporting and other requirements specified in section 1-45-108, C.R.S.

A legislator who has questions concerning campaign contributions should contact the Colorado Secretary of State’s office, at (303) 894-2200, as the agency charged by law with administering the state’s campaign finance laws.

The OLLS has recently published on its website a memo of frequently asked questions and answers concerning the use of campaign contributions. In addition, Dan Cartin or Bob Lackner of the OLLS at (303) 866-2045 are happy to assist you with any questions you may have about the matters discussed in this article.