While the ASA advocacy team has been working hard to build and utilize the ASA-PAC, you may have noticed a Prior Approval form as part of the process we use to talk about the PAC.
The Prior Authorization form began in 1976 when the amendments to the Federal Election Campaign Act established a requirement that corporate-member trade association PACs obtain written approval from member corporations before talking in depth about the PAC and/or soliciting their executive staff. Furthermore, the regulation states that a corporation may approve solicitations by only one trade association per calendar year.
What is the issue with the Prior Approval form? There are three big issues this form has created. First, and most importantly, The First Amendment rights of association member company employees are restricted. Association members have a constitutional right to join in support of or in opposition to candidates for political office. Requiring prior approval discourages our members from participating in our association's PACs, and creates an unequal playing field that limits our members’ First Amendment rights to free speech. This creates an overly burden restriction on associations.
The second issue is requiring trade associations to seek prior approval is discriminatory. Trade-association PACs are heavily regulated by the Federal Election Commission (FEC). There is no “dark” undisclosed money. There are no “mega-donors,” because $5,000 is the maximum amount an individual can contribute in a calendar year. Yet, no other class of PAC – including corporate, labor union and individual membership association – is subject to the prior approval requirement.
The final big issue is that the requirement creates unnecessary confusion for thousands of association member companies. Individuals who are eligible to contribute to a trade association PAC are confused as to why their company must first grant permission for them to be solicited. Most often, association representatives have to repeatedly explain the arduous process.
All these issues create a huge problem for PACs to communicate efficiently with their association members. So what is the solution? There is a coalition that has been formed called the Prior Approval Reform Coalition. This coalition is working hard to get rid of the requirement for trade associations to have to have prior approvals.
The coalition has had some great victories thus far. Representative Mark Amodei (R-NV) sponsored the bill H.R. 2101, which amends the Federal Election Campaign Act of 1971 to allow a trade association or a separate segregated fund established by a trade association to solicit contributions from a member corporation's stockholders and executive or administrative personnel and their families without the approval of the member corporation. Most recently, The House of Representatives passed language in the Financial Services and General Government (FSGG) appropriations bills in 2017 and 2018 defunding enforcement of prior approval. However, similar language must be included in the Fiscal Year 2019 FSGG bill to keep the momentum running.
The coalition sent a letter on Sept.12, 2018, which ASA supported and signed, to the Speaker of the House Paul Ryan, House Majority Leader Kevin McCarthy, Senate Majority Leader Mitch McConnell and Senate Majority Whip John Coryn. The letter addressed the need to defund the Federal Election Commission’s Prior Approval requirement for trade association PACs for the fiscal year 2019.
ASA supports these initiatives and we are very excited to see the work that the coalition has done to help trade associations finally be able to get rid of the Prior Approval and get on a level playing field with other PACs. If you are interested in learning more about the ASA-PAC you can click here. If you would like to learn more about the coalition feel free to contact ASA Director of Government Affairs Catherine Treadwell at firstname.lastname@example.org.