State Issues New Guidance on Campaign Contributions, Allowable Expenditures

pmnj5itr25oemd3wt236_400x400.jpegThe Maryland State Board of Elections last week issued new guidance on allowable campaign expenditures. Permissible expenditures now include child care expenses and cybersecurity costs.

Maryland law requires campaign funds to be used solely for the purpose of supporting or opposing a candidate, question, or political committee. (See Election Law Article §1-101(aa).) Furthermore, there must exist a nexus between the expenditure and the candidacy for which the expenditure relates. In other words, the expenditure is permissible if it would not have occurred but for the fact a candidacy is being promoted, supported or opposed.

According to the State Board of Elections, certain child care expenses can be personal or have an electoral purpose. The determination of the purpose for the expense will decide whether campaign funds are permissible.

Child care expenses would have to have an electoral purpose in order for them to be permissible. For example, a candidate hires a babysitter to care for the candidate’s children while the candidate attends a fundraiser event. This expenditure would not have occurred but for the candidacy and the event has a nexus to enhancing the success of the candidacy. As result of this analysis, the expenditure for the babysitter in this scenario would be a permissible expenditure.

Furthermore, it is important to keep in mind that contributors give to campaign committees for one important reason – they want to support the committee’s candidate, question, or political party. When campaign funds are spent for a non-campaign related purpose, it frustrates the intent of the contributor. There are instances when child care expenses would not be permissible because they are incurred for a personal or non-electoral purpose. For example, a candidate goes to see a movie or attend a school function. In these cases, the nexus to being a candidate is tenuous at best or nonexistent. The attendance at the school function occurred because the candidate is a parent; not because he or she is a candidate. Additionally, going to the movies is personal in nature. In both cases, the need to hire a babysitter would have been present regardless of whether the individual was a candidate or not. Therefore, campaign funds may not be used in circumstances like these.

The importance of election cybersecurity is undeniable. The events of the 2016 elections underscore that foreign nationals attempted to break into campaign accounts and steal priority campaign strategies and information.

In recognition of the threat, the State Board of Elections says some cybersecurity costs qualify as permissible campaign expenditures under Maryland law.

Expenditures in support of cybersecurity countermeasures to protect emails, storage of voter data and other campaign information would have to have an electoral purpose in order for them to be permissible. For example, a campaign that hires an IT specialist to activate two-factor authentication to the campaign email system makes an expenditure that would not have occurred but for the candidacy. Moreover, the expenditure has a nexus to enhancing the success of the candidacy. As result of this analysis, the expenditure for the IT specialist would be a permissible expenditure. However, securing personal accounts of the candidate would not be.

Furthermore, it is permissible for a political party or a legislative party caucus committee to provide cybersecurity protection for candidate campaigns. The political party can allocate the resources used as a coordinated in-kind contribution to the campaign in order to keep expenses at a minimum for a small campaign. Since the expenditures in this scenario would have a campaign purpose, administrative funds may not be used.

Useful Links

Maryland State Board of Elections Guidance on Child Care Expenses

Maryland State Board of Elections Guidance on Cybersecurity Expenditures

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