Super PAC fights for ability to raise unlimited contributions

The organizer of a super PAC formed to support U.S. Sen. David Vitter argues that it should not be subject to Louisiana campaign contribution limits because it is operating independent of Vitter.

But the organizers of the super PAC — the Fund for Louisiana’s Future — have a direct tie to Vitter’s political operations. Two of the people paid to raise money for the super PAC are also paid by Vitter’s campaign operations to raise money for the candidate.

It’s an arrangement that some elections experts say could invite a review by the Federal Elections Commission, called FEC.

The relationships are not necessarily improper because super PACs are so new that the rules are still developing.

For instance, Matthew T. Sanderson, a Washington, D.C., lawyer who handled legal work for political action committees and campaigns of Republicans Mitt Romney and John McCain, says a conflict could exist because the FEC generally forbids fundraisers from working for both a candidate and a super PAC that supports the same candidate.

Charles Spies, who organized the Fund for Louisiana’s Future, counters that other FEC guidances allows fundraisers to work for multiple political committees.

The Fund for Louisiana’s Future was set up last year to support Vitter in a 2015 governor’s race or 2016 U.S. Senate re-election bid. The two-term Republican senator has since announced he’ll run for governor.

The Fund raised more than $1.5 million in 2013 and had $1.3 million in the bank as the year ended, according the latest FEC report.

According to Federal Election Commission reports, Courtney Guastella, of New Orleans, and The LS Group, in Washington, D.C., were paid to raise money for the super PAC and for Vitter’s Senate campaign fund during the same recent time period. Guastella received $40,000 from Vitter’s Senate account and another $28,378 from the Fund.

Guastella is a long-time Vitter fundraiser who has helped raise funds for other Vitter-organized political committees, such as the Louisiana Committee for a Republican Majority and Louisiana Reform PAC.

Vitter’s U.S. Senate campaign paid The LS Group $42,756 last year, while the Fund paid the firm $500.

The LS Group is owned by Lisa Spies, the wife of Charles Spies, the Fund for Louisiana’s Future founder.

Charles Spies’ D.C. law firm continues to work for Vitter.

Federal super PACs, such as the Fund, are allowed to accept unlimited contributions from individuals, corporations, trade associations, unions and other groups, as long as they don’t illegally coordinate with a candidate’s campaign. Corporations and labor unions still cannot give money directly to federal candidates and candidates are subject to individual contribution limits.

Louisiana law caps individual contributions to political action committees at $100,000 per four-year election cycle, which Spies argues is an unconstitutional restriction on “political speech.” He cites a 2010 U.S. Supreme Court decision that allows unlimited contributions as long as super PAC and candidate campaigns are not coordinated.

Spies registered the Fund with both the Federal Election Commission and state campaign finance offices, so the entity can do political work in both arenas on behalf of Vitter.

The Louisiana Board of Ethics rejected Spies’ request that it ignore the $100,000 contribution limit written in state law and allow unlimited contributions. At the time Spies said he expected “someone” to challenge the limit in federal court. On Friday, Spies said he had “nothing to publicly announce” on a lawsuit’s progress.

Legislators who oversee campaign finance laws have said they don’t want super PACs and their unlimited fundraising ability in Louisiana’s state and local elections.

Super PACs are relatively new and issues surrounding their operation are being scrutinized. While there is some guidance in FEC regulations and advisory opinions, others keep coming up. “Things are still changing,” said Andrew Mayersohn, a researcher for the Center for Responsive Politics.

Mayersohn said instances of “vendors” working for a candidate as well as that candidate’s super PAC are being seen more often these days. He said the Center, which promotes transparency in the campaign finance arena, is working on a report about what he called that phenomenon.

“It’s sort of a gray area. I would imagine somebody would try to raise a complaint about that type (of activity) at some point with the FEC,” Mayersohn said.

Former FEC Associate General Counsel Kenneth Gross said having a common vendor is an indicator of coordination “but not a determinative factor.”

“It could invite a review of whether the common vendor acted as a conduit of information between the two committees compromising independence,” said Gross, who worked in the FEC’s enforcement division and now leads the political law practice at a Washington, D.C. firm.

Gross said coordination issues typically come up on how a campaign spends its money rather than on the fundraising side.

D.C. elections lawyer Sanderson said the coordination conflict comes in when a super PAC starts spending money to assist a candidate’s election. But Vitter fundraisers working for the Fund could pose other problems, he said.

“It might be a violation of ‘soft money solicitation’ restrictions,” said Sanderson. Hard money has specific contribution limits. Soft money refers to unlimited contributions such as those flowing through super PACs.

Federal Election Commission advisory opinions make it clear that federal officeholders and their agents cannot raise funds for any organization or election in excess of the federal contribution limits for candidates and political action committees.

As such they are prohibited from raising funds for any federal election or PAC that exceed the federal campaign finance law limits, which is $5,000 a year, or come from prohibited sources, which include corporations and labor unions.

The Fund has received contributions above those limits, some up to $100,000, and from corporations.

“It’s a violation if the fundraiser is determined to be an agent of the candidate,” Sanderson said. “In this instance, if you raise money all the time to benefit the candidate ... they never take that hat off.”

Spies, who organized the Vitter-supporting super PAC said, “The FEC has talked about this dual-hats theory. You can wear multi-hats” doing fundraising for a variety of groups ... It’s not a problem raising money for David Vitter and money for a super PAC. You just can’t say that’s on behalf of David Vitter.”

He added, “The issue comes in if you use strategic knowledge.”

He expects accusations of coordination with the Vitter campaign because of “common vendors,” such as media consultants, pollsters and mass mailers. Fundraisers are not agents involved in how the money is spent, he argued.

Vitter fundraisers can raise contributions on behalf of the Vitter-supporting super PAC, Spies said. “But they have to be clear it’s on behalf of us. You can’t say on behalf of Sen. Vitter, ‘Please give money to Fund for Louisiana’s Future.’ ”

Spies also said donor lists cannot be shared. “You cannot give it from one entity to another,” he said.

One of the FEC opinions involved the son of U.S. Sen. Harry Reid, D-Nev., who raised funds for his father, but also wanted to help raise unlimited contributions to benefit the Nevada Democratic Party. “The FEC allowed him to do that. He could wear multiple hats with one stipulation —that the fundraiser only ask for money that could be used in a non-federal election,” Sanderson said.

The FEC has said that people involved with super PACs can leave and go to work for the candidate they are supporting in an election cycle, but not the other way around — candidate campaign to super PAC. “You can’t have inside information about what the candidates are doing,” Mayersohn said.