Whether they won or not, some of the candidates seeking a coveted spot on the ballot in the November general election for U.S. House and Minnesota governor raised quite a lot of campaign money.
The lucky winners have the November general election to look forward to and will put the money left in their campaign bank accounts — plus a lot more they have to raise — toward TV ads, mailers and lawn signs.
But what about the losers’ cash balances? They can’t just keep the change. But there are options.
Different rules apply to campaign fundraising at different levels of government.
For state-level candidates — that would include candidates for governor, like Tim Pawlenty, Erin Murphy and Lori Swanson, and the state House this year — Minnesota state law determines where campaign leftovers go.
We’ll use former Gov. Tim Pawlenty, who raised $2.1 million and had $1 million on hand on July 23, the end of the last reporting period, as an example. For him, after a primary defeat by Hennepin County Commissioner Jeff Johnson, there are a few possibilities for any money left in the bank:
1. Keep options open
Pawlenty says he’s done with politics, but if he wasn’t and planned to run again, he could keep his committee open but inactive. Committees can be inactive for six years after the last time a candidate filed for office, which would give Pawlenty until 2024. In this case, the candidate can continue to raise and spend money, subject to the same restrictions as active candidate campaigns. They can’t make contributions to other candidates. They have to file end-of-year reports, said Jeff Sigurdson, the executive director of the Minnesota Campaign Finance and Public Disclosure Board.
But assuming he’s terminating his campaign, Pawlenty has to get rid of the money.
2. Put it to political purposes
State-level candidates can’t donate campaign money to federal or local candidates, but they are allowed to give it to other state-level candidates, with limits.
Pawlenty could give up to $40,000 to, for example, another gubernatorial candidate, up to $25,000 to attorney general candidates or up to $10,000 per candidate to state House or Senate candidates. Those are the limits on the amount of money candidates can receive from all political parties and terminating candidates combined.
Candidates can get around those limits and still help their fellow Minnesota elected hopefuls by donating their cash to a registered political party in the state in any amount.
They can also give it to a political committee — as long as it’s registered in Minnesota. That means Pawlenty could give to Minnesota Action Network, a PAC that supported his gubernatorial campaign this cycle, but not a federal PAC.
We likely won’t know the fate of Pawlenty’s post-primary campaign cash until early next year, since candidates knocked out in the primary don’t have to file any more campaign finance reports until then.
3. Charitable giving
Last but not least, candidates can give their money to a nonprofit, as long as it’s a 501(c)3 charity.
So if T-Paw was, for example, a big fan of MN Paws, a nonprofit that finds homes for shelter dogs, he could give his campaign cash to that organization.
Federal rules apply to federal candidates who are pulling out after the primary, like U.S. House hopefuls State Sen. Carla Nelson (who ran in the CD1 GOP primary) or former House Speaker Margaret Anderson Kelliher (who ran in the CD5 DFL primary).
If any of the U.S. House candidates defeated last week were incumbents (none were), they could use leftover money for “winding down costs.” This includes moving expenses, paying committee staff or for nominal gift giving — as long as it’s not to family members — said Judith Ingram, the Federal Election Commission’s press officer.
Since that’s not the case, what options to candidates have? Here, let’s use Anderson Kelliher, who raised $348,000 and had $260,000 on hand as of July 25, the end of the pre-primary federal reporting period, as an example.
Some of the money has to go back to the donors. Individuals are allowed to donate $2,700 to a federal candidate for the primary, and $2,700 for the general. Sometimes, people donate more than the primary limit before the primary, as in the case of H. William, Julie, Judy and Matthew Walter, who each gave the Kelliher campaign $5,400, according to the pre-primary report. Since Kelliher won’t be on the ballot, the $2,700 each of them gave over and above the primary limit will have to be refunded to them, unless it was redesignated to another election cycle.
If Anderson Kelliher is planning on running for federal office again, she can keep her campaign committee open indefinitely, not for just six years as in the case of candidates for state offices in Minnesota. She would have to keep making reports to the FEC, the agency that deals with federal campaign finance, in this case.
If she plans to terminate the committee, her options are similar to that of statewide candidates.
She could give money to other federal candidates (limit: $2,00o per candidate). In Minnesota, terminating federal candidates are not allowed to give money to a state-level candidate, Sigurdson said.
She could give the money to a federal, state or local political party’s committee in any amount.
She could start a PAC.
Or, as with state-level candidates, she could give the money to charity.
Regardless of what she does with any leftover money, Kelliher would have to keep reporting to the FEC until the agency approves a termination.