With Tennessee political action committees growing in numbers and pouring millions of dollars into legislative campaigns, Republican lawmakers are proposing to repeal the limits in current law on how much PAC money they can accept.
Senate Speaker Pro Tempore Bo Watson, R-Hixson, says SB3654 is a logical follow through to legislation enacted last year that authorized direct corporate contributions to state candidates and treats corporations as if they were PACs insofar as disclosing donations goes.
Last year’s law also raised the limits on how much PACs and individuals can donate to Tennessee candidates and provides those limits can be raised annually as inflation increases, a so-called “indexing” provision.
But the 2011 law, pushed by Republicans over objections from some Democrats, left intact the “aggregate limit” on how much PACs can give to candidates. It did raise the aggregate limit for legislative candidates from $75,000 per election to $107,200 — the latter figure being subject to annual increases through indexing.
“With indexing, you reach a point where that limit (on overall PAC donations) is, for lack of a better term, too limiting,” said Watson in an interview.
Dick Williams, president of Common Cause of Tennessee and a longtime advocate of limits on the flow of political money, disagrees.
“The aggregate limit provides at least a little bit of restraint on the influence of PACs,” he said. He contends the growing importance of PACs in campaign finances decreases the importance of donations by individual citizens who cannot give as much as PACs can.
Current law limits individual donations to legislative candidates to $1,400 per election.
PACs may donate up to $10,700 to a state Senate candidate and $7,100 to a House candidate.
Registry of Election Finance figures show that the number of state-level PACs grew from 373 in 2001 to 540 in 2011. Many of the newer PACs are “personal PACs” or “leadership PACs,” set up by legislators as a means of collecting and distributing money outside their individual campaign accounts.
In 2011, a non-election year, PACs gave $2.93 million to state candidates. If traditional trends hold, they likely will more than double that this year, when legislators are running for reelection.
In 2009, also a non-election year, PACs gave $2.69 million, then donated $6.77 million in the election year of 2010. That was with the old, lower limits on how much PACs can give still in effect and direct corporate contributions prohibited.
Drew Rawlins, executive director of the Bureau of Campaign Finance and Ethics, says some legislators — particularly senators — had found themselves “bumping up against” the old $75,000 aggregate limit. That was true even though the limit is for each election, meaning that a candidate could take $75,000 from PACs for his or her primary, then another $75,000 for the general election.
Indeed, at least four legislators collected more than the old $75,000 from PACs during 2011, when the new $107,200 aggregate limit took effect. They were Senate Commerce Committee Chairman Jack Johnson, R-Franklin; Sen. Doug Overbey, R-Maryville; Senate State and Local Government Committee Chairman Ken Yager, R-Harriman; and House Speaker Beth Harwell.
Johnson, who chairs a committee overseeing business-oriented legislation, led the list with $88,242 in PAC money.
House Democratic Caucus Chairman Mike Turner of Nashville said repeal of the aggregate PAC limit is another way for Republicans to enhance the importance of the rich and wealthy private interests and lessen the influence of average citizens.
“We’ve got way, way too much money in politics,” Turner said. “It’s gotten to be un-American the way we let them throw money around.”
Republicans, who control both the House and Senate with solid majorities, are collecting far more money than Democrats are.
A review of financial disclosure filed in January shows Republicans collectively with more than $3.2 million cash on hand in their campaign accounts for legislative races, including party caucus funds as well as individual campaign accounts. The comparable total for Democrats was about $770,000.
The top Democrat in collecting PAC money during 2011 was House Minority Leader Craig Fitzhugh, D-Ripley, with $37,900. Twenty-one Republican legislators collected more than that.
Watson’s bill, which is sponsored by House Republican Caucus Chairman Debra Maggart of Hendersonville in the House, has other provisions that the senator says are also logical follow-ups on the 2010 changes in campaign finance law.
Most notably, the bill would declare that insurance companies can make direct contributions to legislator campaigns. In legalizing corporate contributions generally last year, lawmakers ignored a separate provision in insurance laws — dating back to 1907, Watson said — that forbids insurance companies from making contributions.
The “obsolete” law now on the books, Watson said, is so broadly written that it would apparently prohibit stockholders in insurance companies from making contributions — a provision that is probably violated unknowingly by “hundreds of people” each year.
Williams said he sees no objection to legalizing insurance company contributions, given that other corporations can legally donate. He has sent legislators on the State and Local Government Committee a letter requesting they “divide the question” when the bill comes up for a vote.
That would mean a separate vote on repeal of the aggregate PAC limit rather than lumping all provisions of the bill together to be covered with one vote. The insurance company provision could thus be carved out of the bill, allowing it to pass while the PAC provision could be killed on a separate vote.
Williams said he is uncertain whether the committee will go along with his request.