Accurate PAC Compliance Takes on New Importance for 2022
February 11, 2021
|By Peter Sherman, Senior Vice President of PAC Services |
To say the 2020 election cycle was tumultuous is putting it mildly. From the pandemic to questions about the legitimacy of our elections to an assault on the Capitol threatening certification of the Electoral College results, our politics were in upheaval in ways we haven’t seen since the mid-19th century. The role of PACs has been at the center of much of the controversy. Unfortunately, corporate and association PACs are being scapegoated alongside super PACs and other methods of campaign financing that are far less transparent and regulated. In this heightened political environment, accurate compliance at both federal and state levels needs to remain a priority.
The debate about PAC participation in the political process has led to an uncertain future for many corporate and association PACs. PAC boards and managers, responding to concerns from leadership, employees, and heightened media attention, are being forced to make difficult decisions about their political giving strategy even though we are only a month into the 2022 election cycle—and make them in much more public ways than ever before. Now is the time to get prepared. As campaigns get underway, it is imperative to reassess what’s best in managing your PAC.
Below we outline several steps you should be taking now to ensure your PAC is positioned to weather the storm hanging over the 2022 election cycle as a result of what we saw in 2020.
Start the new election cycle with a clean slate and set up your PAC for the future:
Cash on Hand
State Reporting Schedules
Legislative Black-Out Periods
Communicating with Your Contributors
Between Democrats who refuse to accept contributions from corporate-sponsored PACs and Republicans who opposed certification of the 2020 presidential election, many of our clients are dealing with inquiries from the press and concerns from their leadership and contributors. DDC encourages our clients to take a measured approach and remember that their PAC eligible classes represent a diverse array of political viewpoints. We also encourage our clients to communicate proactively with leadership, PAC boards and eligibles to ensure concerns are being heard and addressed. Your strategy for making contributions going forward must be both well thought out and clearly communicated, and you should avoid taking any reactive positions that you may need to walk back from later in the election cycle.
The current situation is challenging, but as with most challenges, it also presents opportunity—the opportunity to help your eligibles better understand the important role the PAC plays in supporting the company and helping lawmakers stay informed on what is happening with your industry. It’s also important to remind eligibles why engaging with candidates and legislators across the political spectrum is just as vital now, if not more so, than it was in years past. Make sure eligibles understand that remaining active in the political process is critical to the success of the company long term, and that it makes it possible for good candidates who don’t have the resources to self-finance or the public visibility to raise funds exclusively from individual contributions to run competitive campaigns.
It’s also an opportunity to refresh your eligibles on the basics of the PAC—how the company decides which candidates to support, how the PAC is regulated internally and externally, how and why the PAC maintains transparency, and which issues the company is facing. The more people can be reminded how the PAC works to avoid partisanship, stay focused on core business policy issues, and represent the interests of all employees or members, the better the PAC will weather the current storm and emerge stronger.
DDC is here to help if you need assistance with any of the activities discussed above—or simply need to bounce ideas off an expert. We can help you plan your next steps.
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