You have no doubt heard the old adage that in comedy timing is everything. Well, the same could be said of making political contributions.

If you finished out 2023 scrambling to make last minute, year-end contributions before December 31, you may be looking for less hectic ways to plan your political giving. With 40 years of disbursement planning under our belts, we have a few ideas to help you create a giving plan for the new year.

At a minimum, your PAC should have contribution criteria that outlines which candidates/committees are eligible to receive a PAC contribution. A good rule of thumb is to have PAC bylaws which expand on your contribution criteria and detail how money can be raised and spent. Each PAC has its own criteria for giving and this will factor into planning your political spending.  In addition to different giving criteria, many PACs have different individuals requesting contributions to campaigns and committees. Streamlining your process will help to ensure contributions are made in a timely manner and meet all rules and regulations related to giving in a particular jurisdiction.

Consider setting a routine schedule for making your expenditures. Depending on the size of your program, you could create a weekly, monthly, or quarterly schedule. Your PAC may want to consider having a schedule for obtaining Board approval to make expenditures. Having approvers sign off by Tuesday each week, for example, helps Board members plan time to review and approve PAC expenditure requests and avoids any last-minute delays due to a required approver being unavailable.

Another benefit of having a set schedule is to be able to document why a contribution was made on a specific date. Questions from auditors, your eligible class, or a reporter on why a contribution was made to a specific candidate the day before a crucial vote on an important issue, through the PAC, are more easily answered if your organization always write checks on Thursdays, or 10 days before the end of the quarter.

By making some of these small changes, you will set yourself and your PAC up for success during this election season. PASS is here to help implement any and all of these suggestions!

PACs are under attack and not just attacks in the media by anti-PAC factions. These attacks are from criminals stealing money from PAC accounts by duplicating PAC disbursement checks. While it is unclear how the perpetrators are getting the PAC checks, the results are clear. Criminals obtain a legitimate PAC check and use the account name and address along with the banking information to create fraudulent checks. The fraudulent checks look exactly like your PAC check with the routing and account information and even your PAC’s check signature. Criminals change the amounts and distribute the checks to unsuspecting individuals as payment to purchase goods. By the time the seller deposits the check and realizes it’s fraudulent, the criminal is long gone with the merchandise and the seller is left with nothing.

One such situation occurred when a perpetrator sent a check to an individual attempting to purchase a boat listed on an internet selling site. The criminal sent a check in advance to the boat’s owner. The check was for more than the purchase price which the criminal claimed was a “mistake by his secretary”. The criminal then asked the seller to have the difference in cash ready when he came to pick up the boat. Thankfully, this smart seller called the PAC listed on the check and learned that the check he received was fraudulent and he did not go through with the transaction.

More times than not, individuals only learn they deposited a fraudulent check when the check comes back as unpaid. Or the PAC learns about fraudulent activity when they get their bank statement and see that a check that doesn’t match the check register, has been cashed.

What should we do to combat check fraud, you ask? First, talk to your bank about adding positive pay to your account. The positive pay function involves the account holder submitting a file to the bank anytime a check is written. As checks are presented for payment, the bank checks the date, payee, and amount against the file you submitted. Any differences between the file and the check presented result in the check being put into a decision queue. The account holder must review the check presented and determine if it is the check they wrote. If the check presented is not the same as the check written, the account holder simply declines to pay the check and the check is returned to the individual who presented it.

The second option is to skip sending paper checks and move to ACH transactions. Using ACH transactions eliminates a paper check being sent through the mail so there’s no chance it can be used to create fraudulent checks. ACH transactions are electronic and are very secure; however, they are not 100% secure as criminals can obtain the PAC account details and create fraudulent transactions. Additionally, two downsides to ACH transactions are bank fees for each transaction, and you will need to obtain banking information from each campaign seeking a contribution. This could slow down the process of getting a campaign their check, but it will secure your transaction.

The third, and most secure, option for transmitting money to campaigns is to use a combination of ACH and positive pay. Using positive pay – submitting a file to the bank with transaction details to be compared against the instrument presented for payment – and ACH as the payment instrument, you can virtually eliminate fraud on your PAC account. This does take a bit more time and potentially money, but it will save you from the headache of trying to get the funds back from a fraudulent transaction or losing PAC funds if, in the end, you are not able to recoup your money.

To secure your PAC bank account contact the experts at PASS for information about the positive pay feature and ACH transactions.

As state legislatures start to adjourn from their sessions, this time of year usually brings to light campaign finance legislation that was passed and signed into law. This summer is no exception!

Many states raised their campaign contribution limits this year. Most of these increases were based on the rising cost of living as some states include indexing contribution limits for inflation in their campaign finance statutes. However, in some states like New York, the contribution limits were lowered slightly.

Several states enacted legislation this year that changes their existing campaign finance reporting rules.  For instance, Virginia previously required state PACs to file campaign finance reports on a quarterly basis. Going forward, PACs will instead file five reports per year as well as additional reports due within 24 hours if a PAC receives or spends $1,000 or more close to an election. Tennessee eliminated the requirement for state-registered PACs to register and file campaign finance reports in any county where they make county or local political contributions. All reporting going forward will be done at the state level only through the Tennessee Registry of Election Finance. In Wyoming, Federal PACs will once again be required to register and file campaign finance reports with the state when making contributions to Wyoming non-federal candidates.

There is also a growing trend in state legislatures to introduce bills that prohibit “foreign participation” in state elections. At the Federal level, foreign nationals have been banned from participating in the political process for a long time. Some states are simply codifying the Federal ban into their state laws. While others are taking it a step further. This year, Minnesota enacted a ban on political spending by foreign-influenced corporations and LLCs. A legal challenge to the law is likely with the definition of “foreign influence” at the center of the debate. This ban appears to impact many publicly traded companies who have foreign shareholders through the sale of company stock on the exchanges.

When you choose PASS for your federal and state PAC compliance needs, you can rest assured we’ve got you covered. PASS will continue watching closely as states consider and enact campaign finance legislation.