Race is on for convention cash

Race is on for convention cash
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Democrats and Republicans are firing up their fundraising machines for next summer’s presidential conventions.

After Congress eliminated public funding for the nominating extravaganzas, both parties are under pressure to come up with the upwards of $60 million that will be needed to showcase their 2016 nominees.

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The GOP is off to a faster start than Democrats, according to federal reports reviewed by The Hill, hauling in about $3 million from donors for their event so far this year. 

Billionaire hedge fund managers Paul Singer and T. Boone Pickens, the National Rifle Association Political Victory Fund and Charles R. Schwab, the CEO of the financial company with the same name, have all made donations to the fund for the Republican convention, which will be held in Cleveland next July. 

Democrats, meanwhile, have only pooled about $811,000 for their Philadelphia convention so far this year, though Warren Buffett made an early contribution of $16,600.

The convention money involves a trio of new campaign accounts that Congress quietly included in a spending bill that was approved in December. The account for the conventions allows donors to contribute up to $100,200 per year.

The two other accounts, to be used for expenses related to both parties’ headquarters in Washington and legal fees, can also receive gifts of up to $100,200 annually, raising the bar for how much donors can give to party committees.

Watchdog groups, including the Campaign Legal Center and Public Citizen, are concerned that the accounts give wealthy contributors a direct line to lawmakers and party leaders.

“This time around, it’s going to be a blast, because now we don’t even have the pretense of public financing behind the conventions,” said Craig Holman, a government affairs lobbyist at Public Citizen. “These are just going to be special interest soirees [with donors] buying face-time with the presidential candidates and members of Congress.”

“Every convention, the extent of the schmoozing is breathtaking,” he said. “Once they give this kind of money, they’re paying for face-time. That’s what they get: they get dinner, they get receptions with the candidate.”

In 2012, the Republican National Convention in Tampa, Fla., cost the GOP $74 million, while Democrats spent $66 million on their nominating convention in Charlotte, N.C. 

The parties each received about $18.2 million in funding from taxpayers to help defray the cost of the 2012 conventions, but President Obama last year signed a new law, pushed by then-House Majority Leader Eric CantorEric CantorA path forward on infrastructure Democrats step up calls that Russian hack was act of war Paul replaces Cruz as GOP agitator MORE (R-Va.), that redirected those public funds to childhood disease research.

Stripped of public funding, Democrats and Republicans will now have to make up the difference — and will be turning to their allies and big donors to do it.

Both the Democratic National Committee (DNC) and Republican National Committee (RNC) have a political entity set up for their host cities; those entities can raise unlimited sums from corporations, and have provided most of the money for conventions in the past.

In 2012, the RNC had financial help from casino magnate Sheldon Adelson, Cisco Systems, AT&T, the billionaire David Koch, Microsoft, Hewlett-Packard and Coca-Cola when staging its convention bash.

The DNC in 2011 initially said it would not accept corporate donations, though it did receive large checks from the law firm McGuireWoods, comedian Chelsea Handler, billionaire Tom Steyer and Penny PritzkerPenny PritzkerDeVos should ‘persist’ despite liberal opposition Indiana teachers hold sit-in to demand Young recuse himself from DeVos vote Overnight Tech: Trump team eyes FCC overhaul | AT&T chief says no plans to spin off CNN in merger | Commerce pick heads to hearing MORE, who is now secretary of the Commerce Department. 

Democrats also set up a nonprofit called New American City to help fund activities surrounding the convention; that entity raised $19 million and was allowed to use corporate funds.

A DNC spokeswoman told The Hill that the Democrats’ host committee would allow corporate cash to fund the 2016 convention.

But the host city accounts are no longer the only funding option, now that the party committees can stockpile convention cash in internal accounts.

“These additional accounts do change the landscape, and it will be interesting to see how they will come into play during these election,” said Jason Abel, of counsel at Steptoe & Johnson and a former chief counsel to Sen. Charles SchumerCharles SchumerMcConnell: ObamaCare 'status quo' will stay in place moving forward NRA launches M Supreme Court ad Senate about to enter 'nuclear option' death spiral MORE (D-N.Y.).

“Elections are expensive, and the ability for the parties to remain a main focus of the elections is important,” he said. “There have been many in the industry — on both sides of the aisle — who are concerned that the parties have become less of a focus while outside entities [like super-PACs] have gained more power.”

While the DNC has put more than $800,000 in its convention coffers so far, it has not had any donors for its other new administrative accounts. The RNC, meanwhile, pulled in a total of $9.4 million for the three accounts in the first half of 2015.

While the GOP’s convention account had a sizable influx of about $3 million, the building fund garnered the most donations, taking in more than $4.9 million during the first six months of the year.

Gifts to the GOP building fund included contributions from casino magnates Stephen and Andrea Wynn, Peter Coors of the Coors Brewing Co. and H. Ross Perot, Jr., the son of the former presidential hopeful. The RNC’s legal fund took in $1.5 million.

Paul RyanPaul RyanTHE MEMO: Frustrated Trump looks to turn it around Insurers face big choice on staying in ObamaCare Republicans seek to lower odds of a shutdown MORE, senior counsel at the Campaign Legal Center, said that there are no rules for how the money in the new accounts can be spent beyond the account’s general purposes. There is also nothing from stopping party committees from moving the money around, he said.

“The [Federal Election Commission] has not even started any rule making to flesh out what these accounts can be used for,” he said. “The statute is broadly written that the parties may try to — and may get away with — using these accounts for very broad purposes.”