Can Anyone Start a PAC?

Political action committees (PACs) are a staple of the American political system. They play a significant role in supporting candidates, influencing legislative agendas, and swaying public opinion on critical issues. 

The question, however, is whether anyone can start a PAC. The easy answer is “Yes,” but there are some nuances that you’ll have to navigate along the way. 

Here’s what you need to know:

What Is a PAC?

A PAC is a type of organization that collects and disburses funds to advocate for or against political candidates, legislation, or policies in the United States. 

PACs work to influence the outcome of elections or legislative processes according to its members’ or founders’ interests. And they can support candidates by contributing to their campaigns, financing independent expenditure initiatives (independent ads), or engaging in other political activities.

There are several types of PACs, such as:

  • Connected PACs: Established by businesses, labor unions, trade associations, or other organizations 
  • Non-Connected PACs: Operate independent of any sponsoring entity 
  • Leadership PACs: Established by politicians but cannot be used to fund their own campaigns 
  • Super PACs: Can raise unlimited sums of money and spend unlimited amounts to overtly advocate for or against political candidates

The Federal Election Commission (FEC) regulates PACs and governs the registration process. Each state election commission also imposes regulations on PACs, which (among other things) limit the amount that individual entities can give to PACs and the amount that the committee can give to a candidate. 

Regulations also govern the reporting of PAC contributions and expenditures, as well as general behavior. For instance, a connected PAC has to be established by an organization and can only receive donations from its membership (i.e., union members). Conversely, a non-connected PAC can solicit donations from anyone but must follow strict funding limitations. 

The Legal Framework of PACs

If you want to establish a PAC, there’s a good chance that creating a non-connected PAC will be the best framework for your cause. Before you can proceed in doing so, though, you’ll have to navigate overlapping state and federal legal requirements, including registration, reporting contributions and expenditures, and adhering to limits and prohibitions. 

With that in mind, here are some steps to take as you form your own PAC:

Define Your Purpose

Creating a PAC can be a daunting process. And managing the records of your newly formed entity is even more tedious. While forming a PAC can be worthwhile and effective, it’s vital that you understand your “Why” before embarking on such an endeavor. In other words, you need to clearly identify and define your PAC’s mission and purpose. Doing so will guide its activities, messaging, and fundraising strategies.

Navigate the Legalities

Next, you’ll need to register your PAC with the FEC. However, if you don’t plan to participate in or contribute to federal campaigns, you may only need to register your PAC with the relevant state authority. 

Either way, you will have to submit detailed information about your committee to the appropriate governing body, including its name, officers, and bank account details. Be transparent and carefully review every form you submit, as you could incur serious civil and criminal liability for any outstanding errors.

Fundraising and Financial Management

After you’ve successfully registered with the FEC, it’s time to start fundraising. You can leverage grassroots strategies that rely on an abundance of very small donations or target a few large donors. 

From the moment you receive your first donation, you must carefully track your garnered funds. Document the amounts of each donation, the date you received them, who they were provided by, and where they were deposited. Once you start divvying out funds to campaigns or candidates, track where they go. 

Ultimately, you must be able to account for every dollar that enters and leaves your PAC. 

Strategic Operations

With your PAC officially established, the focus now shifts to operationalizing your strategic objectives. This includes things such as endorsing candidates and funding campaigns to advocating for policy positions. The essence of your operations lies in leveraging financial resources to amplify the political voice of the PAC. 

Ethical Considerations

The general public has mixed views regarding PACs. But many may not even know what a PAC is or what one does, either. You can help move public perception in a positive direction by being transparent about contributions and expenditures. More importantly, you can demonstrate your commitment to ethical practices from day one.  

Potential Challenges

You’ll encounter numerous hurdles on the journey to creating a PAC. That’s not to say that you shouldn’t do it, of course, but you need to know what you are up against.

The biggest challenge involves familiarizing yourself with complex federal and state regulations. Once you get past these and register your committee, your next barrier will involve securing initial funding. 

If you want to set the stage for ongoing success, you need to combine a sound mission that you are passionate about with a skilled team and high-quality tools. These are the three pillars of effective political fundraising. 

Need Support for Your PAC? Connect With Aristotle

At Aristotle, we provide comprehensive consulting services for PACs, as well as technologies and tools designed to support your fundraising objectives. We also offer compliance outsourcing intended to help you operate your PAC in a legal and ethical way. If you would like to learn more about Aristotle and our suite of services for political action committees, we invite you to schedule a demo with us today.

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