FEC Rules Personal Use Prohibition Does Not Apply to Leadership PACs
In a recent FEC ruling regarding whether Congressman Lou Barletta’s leadership PAC (LOU PAC) made unlawful rent payments to his wife, the FEC commissioners explicitly articulated that leadership PACs (“LPACs”)— are entirely exempt from the ban on personal use of funds that is applicable to federal campaigns. Federal law lays down a hard ban on candidates using campaign funds for their personal use. However, the commissioners ruled the “prohibition against personal use applies only to the use of funds in a campaign account of a present or former candidate.” Meaning, the personal use prohibition is limited in scope to funds held by a candidate’s authorized committee and does not extend to LPACs.
Therefore, the FEC ruled the Barlettas did not violate these strict regulations because they appeared to be paying fair market value for rent and the funds used came from an LPAC. Further, the FEC upheld the exemption despite the background that here, the funds in question were originally donations from a campaign committee converted into a PAC and then transferred to the LPAC.
The full FEC ruling can be found here.
Despite this FEC ruling, campaigns should still consider political ramifications and appropriateness of using LPAC funds for personal use.
Reach out your Holtzman Vogel contact if you have any questions regarding this new ruling regarding personal expenses and Leadership PACs.