Voting Campaign Finance Reform: PACs Use these links to navigate the main sections of the Voting: Campaign Finance Reform section. Links for navigating the entire voting section, as well as the rest of the Law, Diversity and the Vote site are at the bottom of the page. Introduction, History & Change | PACs | Recent Reform Proposals Arguments For & Against Campaign Finance Reform YOU Vote! | Resources/Links for This Section PACs Political action committees or PACs began forming as early as 1943, but formed more quickly in the 1970s as the new laws made it clear which types of campaign contributions and expenditures were legal. There are two types of PACs: PACs may be affiliated with labor unions, corporations, and associations or organizations which maintain separate funds from their operating budget funds. These “segregated” funds are supported by voluntary donations on the part of members for contributions to candidates; “Nonconnected” or independent PACs are not affiliated with any other organization, but raise money to try to influence the outcomes of election campaigns. Instead of contributing money towards a candidate. While corporations were initially cautious about the legality of PACs, the Federal Election Campaign Act of 1971 authorized use of separate, segregated funds by corporations and unions. An advisory opinion from the newly created Federal Election Commission stating that corporations and unions that were government contractors could give to federal candidates led to a rapid increase in the number of PACs. From just over 100 PACs in 1971, the number grew to 3,525 by 1983. Buckley v. Valeo In 1976, the U.S. Supreme Court ruled unconstitutional substantial portions of the 1974 Federal Election Campaign Act. In Buckley v. Valeo, the Court stated that limits on contributions by candidates to their own campaigns, limits on independent PAC expenditures, and limits on campaign expenditures restricted the First Amendment rights to free speech and association. The Court noted that any limitation on campaign contributions and expenditures restricts freedom of expression. At the same time, the Court ruled that expenditure limits have a more severe impact on free expression than limits on contributions. According to the case, contributions to a candidate are intended to facilitate free expression by someone else - the candidate - and may be limited. The Court accepted the idea that the government has a legitimate interest in the prevention of corruption and therefore upheld the $1,000 limit on individual contributions and the $5,000 limit on PAC contributions. While the Court rejected the claim that the government had an interest in curtailing skyrocketing costs of political campaigns, it upheld the legality of restricting contributions to and spending by presidential candidates who accept public campaign funds. Click here to read the decision in Buckley v. Valeo Soft Money v. Hard Money Under current law, corporations and labor unions are prohibited from making contributions in connection with a federal election, while individuals and PACs are subject to federal limits of $1,000 and $5,000 respectively. We talk about two types of money when we talk about campaign financing: Hard money is direct contributions to a political candidate that is regulated under federal law. Soft money is money that is raised by political parties for general purposes but not designated for a particular candidate. In the past, this money has been unregulated and candidates were not required to disclose the amount of their “soft money” contributions. The FEC began requiring parties to disclose their soft money contributions in 1991. During the 1996 election, national parties raised over $622 million in soft money and they are on track to double that amount in the upcoming election. >>Youth Citizenship >>Voter Registration >>Representation >>Campaign Reform Conversation | *Voting* | Activities | Resources Online Conversations | Law, Diversity, and the Vote