US Presidents

What happens to campaign contributions if the candidate quits?

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2008-02-21 18:16:01

January 10, 2008 | As the once-thick presidential field

thins with every primary contest, the candidates who fail to

capture their party's nomination may be left with lots of money but

few options for using it. According to the nonpartisan Center for

Responsive Politics, as of the end of September, the candidates had

stored up $33.6 million for the general election-money they can't

touch unless they make it beyond the primaries. The money the

candidates have raised for the general-which will probably turn out

to be even higher when year-end reports are filed Jan. 31-is

equivalent to the cost of putting 28,000 new Apple computers in

schools that need them, buying a McDonald's Big Mac for every

resident of Michigan or donating the entire Harry Potter book

series to nearly every household in New Hampshire and Maine. The

candidates who drop out of the race or end up losing their party's

nomination won't get to use their leftover money for anything of

the sort, however. Instead, under the Federal Election Commission's

rules, candidates can either refund the money to their donors

within 60 days after the person is no longer a candidate or get

permission from their donors to re-designate it for use by the

candidate's campaign for another federal office. To pay off debts

from their primary campaigns, candidates can tap general-election

funds from contributors who didn't max out in the primary*, with

the donor's permission. If, for example, Hillary Clinton doesn't

make it to the general election season, she'll have to go back to

the donors who've given her at least $16.7 million toward

November's election and get their permission to use it to pay off

primary debts, transfer it to her Senate committee or use it in a

future presidential campaign. As of the end of the 3rd Quarter,

Clinton had more saved up for the general election than any other

candidate, according to FEC reports, while Rudy Giuliani had the

most among Republicans at $5.1 million. By comparison, the

also-rans in the 2004 presidential race ended their bids with only

$2.5 million among them. When presidential hopefuls abandon their

campaigns before their party nominates its candidate, they often do

so because they don't have enough money to compete in the

primaries, much less the general election. By the time Sam

Brownback (R-Kan.) and Tom Tancredo (R-Colo.) dropped out of the

race, neither had raised any funds for use beyond the primary

season. New Mexico Gov. Bill Richardson, a Democrat, dropped out of

the race this week with at least $674,680 in the bank for the

general election. Chris Dodd (D-Conn.), who quit after the Iowa

caucuses, had collected $1.5 million toward November's contest,

while Joe Biden (D-Del.) had brought in $1 million. With Biden now

likely to run again for Senate this year, one of the supporters of

his aborted presidential campaign said he's not expecting his money

back. He trusts the candidate to do what's best with the money,

including putting it toward his upcoming re-election. "If you

support a candidate and give him money, you're saying you'd support

what he'd do with the country and with national security," said

Harvey Gurland, a lawyer in Miami who gave $1,000 to Biden. "If you

trust someone to protect our citizens, you'd certainly have a good

feeling about what they'd do with the contribution you gave to his

candidacy." Sometimes, though not often, candidates drop out of the

race, or lose, with money designated for the primaries still

sitting in their bank accounts. (Those who do make it to the

general election can put any remaining primary funds toward that

race). Although the presidential candidates raised about $400

million for the primaries in the campaign's first nine months,

they're likely to have spent most of it to compete in the

early-voting states. For those who finish the race with money

remaining in their primary-season account, the FEC's rules for how

they can use it aren't as strict. They can: * Give the money to a

charity from which they don't earn a salary * Make unlimited

transfers to party committees * Make unlimited transfers to the

candidate's committee for another federal office, without

permission from donors * Transfer money to their state committees

if state law allows * Refund the money to donors * Contribute up to

$2,000 to another federal candidate's campaign committee *

Contribute money to state and local candidates, subject to state

and local law Moreover, candidates can leave their campaign

accounts open indefinitely. Former president Bill Clinton, for

example, has an old committee that still has $13,000 on hand.

Republican Gary Bauer, who ran for president in 2000 and dropped

out, has $4,810 sitting in his account. The leftover money can't be

used, however, for any personal expenses, although the line

sometimes blurs between personal expenses and political interests.

Six years after his unsuccessful bid for president in 2000,

Democrat Al Gore gave $117,500 of his leftover funds to the Climate

Project, a nonprofit organization that aims to educate the public

about global warming, Gore's pet issue. The group also trained

volunteers to present the slide show on which Gore's film, "An

Inconvenient Truth," was based. The only limit on giving to a

charity is that the candidate and his or her immediate family can't

receive compensation from it. In the 2008 race, if she isn't the

Democrats' nominee, Hillary Clinton could decide to donate leftover

primary funds to her husband's charitable foundation, the William

J. Clinton Foundation, which focuses on hunger and poverty in

developing countries, AIDS and climate change. Or she could give it

to the Clinton Family Foundation, which donates to other

nonprofits. The Clintons do not draw salaries from either

foundation, according to Hillary Clinton's personal financial

disclosures. If John Edwards doesn't get the Democratic nomination,

he could give his supporters' contributions to the foundation he

and his wife established in memory of their late son, the Wade

Edwards Foundation, which has opened computer and learning labs for

high school students in North Carolina. Edwards could also transfer

his leftover primary cash to his nonprofit, the Center for Promise

and Opportunity, which raises awareness about poverty. Questions

arose as the center, which is prohibited from engaging in political

activity, financed Edwards's travel to New Hampshire and other

states before he officially became a candidate. *A clarification

added Jan. 31, 2008 CRP Researcher Douglas Weber contributed

to this report. Capital Eye thanks Bob Biersack, press

officer at the Federal Election Commission, for his assistance with

this story.

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