In the previous How the Money Moves I mentioned that it seemed likely Comptroller Leslie Munger would receive significant funding soon based upon how little financial activity her committee had shown up to that point. Since that time there were two key developments, neither unexpected: 1) Munger’s committee received a loan of $260,000, enough to lift the contribution limits for this race, and 2) late last week she received $2 million from Richard Uihlein and $3 million from Ken Griffin, two of the Governor’s wealthy allies.
Combined with the $280K Munger had on hand on 6/30 these new contributions gave her an estimated $5.5 million to spend in the homestretch of her campaign, much less than you’d typically see in a top ballot statewide race like Governor or US Senator but along the higher end for the other statewide constitutional offices. With her new ad on TV it was reasonable to assume that this money would be used to fund her fall budget.
However today there was an unexpected development, the Illinois Republican Party filed two A-1’s (here and here) for transfers totaling $3 million from Munger to the State Party. Here are a few possible explanations:
Possible Explanation #1
It’s possible that she is transferring this money to the State Party to fund a mail budget. State Parties pay a lower postage rate, that’s why you so often see General Assembly candidates file A-1’s with in-kind contributions for mail from the State Party. However in this case this seems somewhat unlikely, she’s already up on TV with her ad and $3 million seems like an awfully large mail budget. It’s very common for statewide campaigns to have mail in addition to TV, especially in those media markets where the candidate isn’t up on TV, but usually not at this level or at this proportion.
Possible Explanation #2
It’s possible that in order to keep staffing costs low she’s outsourcing some of her campaign activities to the State Party, where some of the Governor’s top political staffers are employed, and she’s transferring part of her budget to their control. If that’s the case this transfer would seem like an unnecessary step, her campaign and the State Party are allowed to fully coordinate strategy and tactics and her campaign committee could have easily paid any campaign expenditures that were needed.
Possible Explanation #3
Another very likely possibility is that her campaign committee is being used as an entryway to get unlimited contributions into the system where that money can then move freely around to be spent on other races. I discussed the need for entryways in my previous post. The House Dems have had a number of large donors, particularly in labor and legal, who are willing to contribute more than the maximum amount so they’ve had to break up those contributions into the amounts permitted by contribution limits and then contribute those amounts to as many Democratic affiliated committees as necessary to get all the money in the system. In a general election candidate committees can make unlimited transfers to party committees and party committees can make unlimited transfers to candidate committees so once that money is in the system the candidate committees with surplus funds can either transfer those funds to their fellow candidates up to the limited amount or they can make unlimited transfers to their party committee where the funds can then be redistributed in unlimited amounts to other candidates in need.
However in this case the contribution limits are off for the Comptroller’s race because of the $260,000 loan Munger received from her husband. Munger (and Mendoza) can accept contributions in unlimited amounts and if they so choose they can then make unlimited transfers to the party committee who can then spend or transfer unlimited amounts on other candidates, such as targeted general assembly races.
Prior to last week the Governor had been almost single-handedly funding the Republican legislative effort. The only other significant pool of money was in the Independent Expenditure committee Liberty Principles PAC which had raised $5 million since June, $2.5 million from Governor Rauner personally, $1.5 million from Richard Uihlein and $1 million from Ken Griffin. However the funds in the IE committee are somewhat walled off, independent expenditure committees are not allowed to transfer funds to candidate or party committees so if these donors wanted to use their money to help legislative candidates they could only do so by making expenditures independently. But now that the contribution limits have been lifted in the Comptroller’s race they can make direct unlimited contributions to Munger who can then transfer that money to the party as needed and it can be put to use elsewhere.
Just because Munger transferred $3 million to the State Party today doesn’t mean she won’t get additional financial support later to supplement her campaign budget, she may still very well spend $5.5 million on her fall effort if additional contributions are received. Also, it’s unlikely that this is our last unexpected development before the election. Stay tuned.