Now that the presidential election has concluded and 2024 is drawing to a close, it is worth looking back at one of the most consequential years for the Federal Election Commission (FEC) in recent memory. From expanding opportunities for federal candidates to both collaborate with grassroots groups on getting out the vote and raise unlimited money for state ballot measures to clarifying the ways in which candidates and parties can engage in joint fundraising activities to issuing guidance on the use of AI-generated content in campaign ads, the FEC had a remarkably active year that will have an enduring impact on the country’s electoral system.
Below is a summary of the FEC’s most significant decisions in 2024.
Candidate interactions with canvassing groups. In a decision that significantly influenced the interactions between campaigns and outside groups during the 2024 election, the FEC concluded in Advisory Opinion 2024-01 (Texas Majority PAC) that federal candidates may consult and share non-public strategies and plans with groups engaged in door-to-door canvassing without these activities being considered “coordinated” under FEC regulations. This means that expenses related to such canvassing programs are not counted as in-kind contributions to the candidates being consulted.
The FEC reached this decision after determining that door-to-door canvassing programs are not “public communications” because they do not involve the dissemination of content through an intermediary like a TV or radio station, a newspaper, or a third-party website. As non-public communications, canvassing programs fall outside the definition of “coordinated communication,” even when they are financed with money raised outside federal contribution limits and involve extensive input from a federal campaign.
This decision created new opportunities for candidates to work directly with outside groups (like Super PACs and non-federal political committees) to conduct grassroots activities supporting those candidates, including express advocacy on the candidates’ behalf. Groups that collaborate with candidates on canvassing efforts but that also plan to engage in paid advertising (such as TV ads, phone-banking, and direct mail)—all of which qualify as public communications—will need to establish appropriate firewalls to ensure that such ads do not trigger the FEC’s coordination regulations.
Candidate fundraising for state ballot measures. In Advisory Opinion 2024-05 (Nevadans for Reproductive Freedom), the FEC considered whether a federal candidate may raise money outside of federal limits and source prohibitions for groups that support or oppose state ballot measures. The advisory opinion was requested because federal candidates are subject to a prohibition against raising or spending funds “in connection with an election for Federal office … unless the funds are subject to the limitations, prohibitions, and reporting requirements of” the Federal Election Campaign Act (FECA). The Commission concluded that FECA’s definition of “election” only covers individuals seeking elective office, and that ballot measure contests fall outside the scope of the term. For this reason, restrictions on a federal candidate’s ability to raise and spend funds in connection with elections do not apply in the context of ballot measure contests.
Thus, following Advisory Opinion 2024-05, federal candidates may now raise unlimited funds from wealthy individuals, corporations, and labor unions on behalf of groups supporting or opposing state ballot measures if otherwise permitted by state law. This is true even if federal races and a ballot measure are voted on during the same election. Candidates will need to remain mindful, though, that they are still subject to state laws, which may impose their own contribution limits and source prohibitions. (Relatedly, the FEC recently submitted a legislative recommendation to Congress to amend FECA to prohibit foreign nationals from making contributions or expenditures in connection with state and local ballot initiatives and referenda.)
Joint fundraising committees. The FEC received multiple advisory opinion requests regarding the rules applicable to joint fundraising committees (JFCs) this past year. The first request was brought by Holtzman Vogel on behalf of Team Graham, the principal campaign committee of Senator Lindsey Graham, asking whether the JFC in which it participates may also include a Super PAC. The FEC approved the request on the condition that (1) any funds raised by the Super PAC comply with federal contribution limits and source prohibitions, and (2) the campaign may not engage in coordinated communications with the Super PAC. Importantly, the FEC determined that the candidate’s campaign and other JFC participants (including the Super PAC) may collaborate on distributing public communications in the form of solicitations, invitations, and similar fundraising event announcements on behalf of the JFC, and that the communications will not constitute coordinated communications, so long as each JFC participant pays its proportionate share of the related expenses.
A month later, the FEC addressed a second request regarding JFCs, this one brought by the DSCC and two Democratic Senate candidates. Their question was whether a JFC consisting of a federal candidate and a political party could (1) pay for television ads that expressly advocate for the election or defeat of an identified candidate and contain a fundraising solicitation (with an on-screen QR code linking to an online donation webpage) at the end and then (2) split the costs among the JFC participants according to the allocation formula in the joint fundraising agreement. The requesters also asked whether the proposed ads would need to include the full joint fundraising notice, disclosing (among other things) all participants and the allocation formula.
Holtzman Vogel submitted comments on behalf of both the NRCC and attorneys in the firm’s campaign finance group explaining that a JFC’s payments for the proposed solicitation communications would be consistent with FEC regulations and precedents and with past joint fundraising practice. Nevertheless, the requesters indicated through their written comments and their responses at the FEC meeting at which the request was considered that their primary motivation was not to fund JFC ads themselves but to impose restrictions on third parties engaged in joint fundraising activities similar to those described in the requesters’ proposal.
The FEC split 3-3 on the request, with the three Republican Commissioners concluding that the requesters’ proposal complied with the applicable joint fundraising regulations and that the proposed ads did not need to include a full joint fundraising notice so long as the QR code in the ads directs viewers to a webpage containing the full notice, while the three Democratic Commissioners took the opposite position. The Commission’s deadlock will likely result in more JFCs between parties and candidates running similar solicitation ads since it is clear that there are not currently four votes on the FEC to find that such conduct amounts to a violation.
Note, though, that the DCCC has filed suit against the FEC, arguing that the agency’s failure to issue an advisory opinion in response to the DSCC’s request violated the Administrative Procedure Act and seeking a declaration that the joint fundraising activity at issue in the request constitutes a contribution from the political party to the participating candidates. The district court denied the DCCC’s motion for preliminary injunction before the election. But the case is ongoing and worth monitoring.
Candidates establishing state PACs. In a decision that enhances the ability of federal candidates to assert influence in state and local elections, the FEC approved Advisory Opinion 2023-09 (Cortez Masto) concluding that a federal candidate may establish a state-level political committee that engages exclusively in non-federal activities, so long as the committee complies with federal contribution limits and source prohibitions. The FEC also determined that donations to the state-level committee will not be aggregated with contributions made by the same source to the candidate’s federal leadership PAC. This is because amounts raised by the state committee are not “contributions” under FECA since they will not be used for the purpose of influencing federal elections. So, a single person may now annually give up to $5,000 to a federal candidate’s leadership PAC and another $5,000 to that candidate’s state committee.
Now that federal candidates can establish what are, in essence, state-level leadership PACs that have their own separate contribution limits, they have another vehicle available to them for raising and spending money, in this case to sway state and local elections as well as ballot measure contests. Candidates who decide to establish state committees will need to ensure they comply with all applicable state law requirements, including those governing registration and reporting.
Hybrid advertisements. “Hybrid advertisements” are campaign communications that contain both (1) a reference to a specific federal candidate and (2) a more generic reference to a political party and its candidates and whose costs are allocated between the candidate and the political party on a time-space basis. Hybrid ads have been commonplace in federal races for 20 years, but until this year, an FEC majority had never formally held that such ads are permissible. That changed in Advisory Opinion 2024-14 (Rosen), where the Commission confirmed that the costs for ads that “equally promote” a particular candidate and a political party more generally may be split evenly between the candidate and the party.
In the opinion, the FEC clarified that portions of an ad that depict or feature narration from a federal candidate must be allocated to—and paid by—that candidate’s campaign committee. The FEC split, however, on whether certain audio and visual elements (including references to a party’s presidential candidate) qualify as generic references to a party’s candidates. Holtzman Vogel submitted comments on behalf of the NRCC recounting the prominent role that hybrid ads have played in the political process for over two decades.
Candidate security. The FEC promulgated a new rule clarifying that a federal officeholder or candidate may use campaign funds to pay for various security measures to address ongoing threats. The use of campaign funds for such measures is not considered prohibited “personal use” of campaign funds so long as the threats would not exist if the individual were not an officeholder or a candidate.
Permissible security measures—which may also be provided to an officeholder or candidate’s family members and employees—include:
- Non-structural security devices, such as locks, alarm systems, motion detectors, and security cameras;
- Structural security devices, such as wiring, lighting, doors, and fences, provided these are solely for security and not for property-improvement purposes;
- Professional security personnel; and
- Cybersecurity protections.
The FEC has previously authorized the use of campaign funds for officeholder/candidate security through a long-running series of advisory opinions. The new rule codifies those earlier advisory opinions and expands upon them in certain instances to address additional issues.
AI in campaign ads. The FEC declined to act on a rulemaking petition asking the FEC to broadly prohibit campaign ads that use deceptive images, video, and audio of candidates that are generated by artificial intelligence (AI). The primary reason for not opening a rulemaking on AI was that the FEC lacked the statutory authority to do so. FECA regulates “fraudulent misrepresentation” only in circumstances where (1) a candidate purports to speak, write, or act on behalf of another candidate or political party in a damaging manner, or (2) any person falsely represents that he or she is speaking, writing, or acting on behalf of a candidate or political party for purposes of soliciting contributions. The more comprehensive rulemaking on AI-generated campaign content sought by the petitioners would have gone far beyond those narrow statutory limits.
Instead, the FEC issued an interpretive rule clarifying that FECA’s “fraudulent misrepresentation” provision is “technology neutral,” and that “[t]his fraud may be accomplished using AI-assisted media, forged signatures, physically altered documents or media, false statements, or any other means.” The FEC’s decisions demonstrate that any additional regulation of AI usage in political communications will first require congressional action.
Reporting independent expenditures by non-political committees. In the enforcement context, the FEC clarified the donor disclosure that is required to be reported by non-political committees that disseminate communications that expressly advocate the election or defeat of a federal candidate. Five Commissioners concluded that independent expenditure reports filed by groups that are not federal political committees only need to disclose contributions that are received during the same quarter in which the independent expenditure was made. Contributions received during previous quarters do not need to be included on such reports.
The donor disclosure requirement discussed above only applies to “contributions”—donations earmarked for political purposes or funds intended to influence elections. The three Republican Commissioners interpret “contributions” to mean funds “designated or solicited for, or restricted to, activities or communications that expressly advocate the election or defeat of a clearly identified candidate for federal office.”
Definition of “express advocacy.” A Commission majority also provided additional guidance on the definition of “express advocacy” this year. Understanding the parameters of this definition is crucial because engaging in express advocacy may activate requirements to register as a political committee or report independent expenditures.
The FEC addressed the express advocacy issue in an enforcement matter involving Super PAC ads that sharply criticized a federal candidate. The ads at issue referred to the candidate as “shady,” claimed he got rich off government loans he never paid back, said his campaign was spending millions to buy a Senate seat, and called him “[j]ust another millionaire politician who says one thing and does another.” A four-vote Commission majority concluded the ad was not express advocacy under either the “magic words” test or the broader test that requires that “reasonable minds” cannot differ about an ad’s message. The majority’s rationale rested primarily on the fact that the ad was run nine months before the election, concluding that “it is axiomatic that the further an ad is run from a given election, the more likely that reasonable minds could differ about whether the ad constitutes an exhortation to vote for or against a specific candidate.”
The group that filed the complaint in this matter is challenging the legality of the FEC’s dismissal in D.C. federal district court. So, this is another case to watch closely.
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To paraphrase George Orwell, all years are equal, but some are more equal than others. That is certainly true of this past year for the FEC. The reverberations from the agency’s decisions in 2024 will be felt well into the future and create new opportunities for candidates, political parties, and advocacy organizations alike.
