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How much is too much?  A study of PAC burn rates

 

As Q1-2012 FEC reports are about to come due (& March monthly's), now is a good time for PACs to ask themselves "are we running our business well?"  Make no mistake; PACs are serious businesses, and a key measure of the health of any enterprise is its burn rate - the percentage of revenues consumed in operations.

 

For PACs, the burn rate is based on non-political costs other than candidate contributions, Independent Expenditures, and the like.  If too much of a PACs' revenues are consumed by administration, correspondingly little goes towards political purposes, and it risks failing in its role as a good steward of donor contributions.

 

Building on our first analysis in July 2010, we've prepared a comparative study of 2010 and 2012 (to date) non-connected PAC burn rates based on FEC reports.  Expanding on our original 2010 analysis, this study further analyzes the distribution of burn rates across PACs by size.  Ultimately, we identify a suggested target burn rate for PACs.

 

CLICK HERE TO DOWNLOAD THE STUDY

 

This study only includes non-connected PACs, and excludes Leadership PACs, connected PACs, and PACs with Carey Accounts (SuperPACs & Hybrid PACs).  Leadership PACs have unique characteristics set apart from other Non-connected PACs.  the administrative costs of Connected-PACs are generally paid for by the connected entity, which need not report them, so there is neither a direct relation between revenues and costs nor any data.  PACs with Carey Accounts are excluded because their ability to accept unlimited contribution would skew the data and they are too new to draw comparisons.

 

Special thanks to Huan Zhu, S.J.D., who recently completed her clerkship at DB Capitol Strategies and was the lead researcher and co-author of this extensive study.

 

For more info on complying with upcoming reporting in the changing campaign finance landscape, contact us at 202-210-5431 or via email to [email protected].

Dan BackerDB Capitol Strategies & Dan Backer, esq.

 

DB Capitol Strategies offers campaign finance & political law advisory to PACs, campaigns and candidates.

 

Dan Backer, is at the front lines defending free speech and association before the FEC.  Most recently, Dan was lead counsel in the ground-breaking Carey v FEC case, which paved the way for Hybrid PACs by winning the right of any non-connected PAC to operate a "Carey Account" - in essence becoming SuperPACs.

 

Dan previously served as a legal policy analyst and subject matter expert in military and overseas voting for the Department of Defenses' Federal Voting Assistance Program (FVAP)

 

Dan earned his J.D. at George Mason University School of Law, a PAC Mgmt. Masters Certificate from George Washington, and a B.A. in Political Science from the Univ. of Massachusetts at Amherst. In 2009, Dan earned the American League of Lobbyists Professional Lobbying Certification (PLC).

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Steve Hoersting

Stephen M. Hoersting* brings campaign & litigation leadership to DB Capitol Strategies

 

Rapidly changing campaign finance laws continue to be a dominant theme of the 2012 cycle. DB Capitol Strategies is pleased to have Stephen Hoersting, an innovator at the cutting edge of campaign finance law, join our firm.  Steve brings tremendous experience advising campaigns and advancing free-speech for political organizations to our team.

 

Steve co-founded the Center for Competitive Politics (2005 to 2011) where he devised speech-protective projects, including co-counsel on SpeechNow.org v. FEC and Carey v FEC. Steve served as general counsel to the National Republican Senatorial Committee under then-chairman Sen. George Allen (R-Va.) from 2003 to 2005, where he advised 51 Senate offices and 34 campaigns in the first election under McCain-Feingold to help win seven of eight open seat races for U.S. Senator.

 

Steve also served as chief counsel to a vice chairman of the Federal Election Commission from 2000 to 2003, was a pre-publication commenter on John Samples' The Fallacy of Campaign Finance Reform, University of Chicago Press (2006) and a commentator and research assistant for Bradley A. Smith's Unfree Speech, Princeton Univ. Press (2001). He has published on campaign finance issues for the Cato Institute, the Election Law Journal, The Washington Times, Roll Call, The Weekly Standard and National Review Online; appeared on C-SPAN's Washington Journal, CNBC's Street Signs and offered expert testimony on Capitol Hill.

 

Steve earned his J.D. from Capital University Law School, cum laude, in 1996, and a B.A. in economics from The Ohio State University in 1990. He is an alumnus of the Institute for Humane Studies and served as The Federalist Society's Publications Chairman for its Free Speech and Election Law Practice Group.

 

Connect with Steve at [email protected]
 
*This attorney is only licensed to practice in Ohio

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This information is not intended as legal advice, which turns on specific facts. Seek specific legal advice before acting with regard to the subjects mentioned herein.  For more information, visit our website at www.DBCapitolStrategies.com�2012 DB Capitol Strategies PLLC, All rights reserved.