Satellite spending

This article does not receive scheduled updates. If you would like to help our coverage grow, consider donating to Ballotpedia. Contact our team to suggest an update.

Satellite spending refers to political spending not controlled by candidates or their campaigns; that is, any political expenditures made by groups or individuals that are not directly affiliated with a candidate. This includes spending by political party committees, super PACs, trade associations, and 501(c)(4) nonprofit groups. This type of spending includes express and issue advocacy.

Usage

What Ballotpedia defines satellite spending is commonly referred to as outside spending by opponents of this type of activity. Ballotpedia defines political spending that is not controlled by candidates or their campaigns, as satellite spending because, as with satellites in space, in neither case does the center necessarily control the satellites, even though the center does explain their orbit. Numerous satellites orbit the earth each day, all of which have different reasons for doing so. Numerous instances of satellite spending related to an election or issue orbit around the campaign or topic, but have different purposes and objectives relative to them.

When covering campaigns and issues, Ballotpedia describes the specific satellite spending listed below according to the way that spending is described by other groups observing the elections and campaigns. Where Ballotpedia is in disagreement with other groups' description, or perhaps because of ambiguity in available descriptions, we make our most educated determination.

It should be noted that our determination is not be taken to express an opinion about the intention of the issue group, nor of the law. Issue advocacy, for instance, has varied uses and the evolution of its usage is described in the section below.

Satellite spending typically takes one of the following forms:

1. Express advocacy, which refers to political advertisements that expressly and clearly support or oppose a particular electoral outcome.
2. Electioneering communications, or advertisements "that do not expressly advocate the election or defeat of a candidate but that are nevertheless aimed at influencing the outcome of an election." Although an electioneering communication does not expressly advocate for or against a candidate, it does refer explicitly to a candidate. Such advertisements are broadcast within the 60-day period preceding a general election or the 30-day period preceding a primary.
3. Issue advocacy is focused on "broad political issues rather than specific candidates."
4. Communication costs, which apply primarily to unions, trade groups and other member organizations. Such groups "can communicate with their members and stockholders on any subject, but when the communications expressly advocate the election or defeat of a clearly-identified federal candidate, the directly-associated costs have to be reported to the Federal Election Commission."

Regulations and reporting requirements vary depending on the type of organization making an expenditure and the type of expenditure being made. A super PAC is required to register with the Federal Election Commission (FEC) and must file regular reports disclosing the group's receipts, disbursements, and other financial information. Other organizations, such as unions, corporations or nonprofit groups, must file disclosure reports with the FEC if they spend more than $250 in a calendar year on express advocacy. These organizations must also report to the FEC when they have spent more than $10,000 in aggregate on electioneering communications in a single year.

At the federal level, this kind of spending, regardless of the form it takes, cannot be coordinated with a candidate's campaign.

Issue advocacy

Seal of the United States Supreme Court

The meaning of issue advocacy has evolved and has multiple potential uses as a way of raising awareness about both political and social issues. Below is a history of its development.

Buckley v. Valeo

The 1976 Buckley v. Valeo U.S. Supreme Court decision established two types of political advertising: express advocacy and issue advocacy. Express advocacy advertisements explicitly recommend election or defeat of a candidate. They are also subject to federal campaign regulations. Issue advocacy advertisements, on the other hand, educate voters on broader issues; they are not campaign-oriented.

The Buckley decision established a test by which to judge whether political advertisements were express advocacy or issue advocacy by use of the so-called “magic words,” which are "clear expressions of support or opposition" for a particular electoral outcome. Examples of clear expression or opposition include terms like “vote for,” “election,” "support,” "vote against,” “defeat” and "reject.” Advertisements avoiding those magic words are not considered express advocacy; rather, they are considered issue advocacy.

Bipartisan Campaign Reform Act

Sen. John McCain (R)

According to the Congressional Research Service, two campaign finance issues dominated the public discourse during the 1990s: "soft money" and issue advocacy:

“	Two issues—soft money and issue advocacy (issue advertising)—were especially prominent. Soft money is a term of art referring to funds generally perceived to influence elections but not regulated by campaign finance law. At the federal level before BCRA, soft money came principally in the form of large contributions from otherwise prohibited sources, and went to party committees for “party-building” activities that indirectly supported elections. Similarly, issue advocacy traditionally fell outside FECA regulation because these advertisements praised or criticized a federal candidate—often by urging voters to contact the candidate—but did not explicitly call for election or defeat of the candidate (which would be express advocacy).	”
—Congressional Research Service

To address these issues, Congress passed the Bipartisan Campaign Reform Act in 2002, also known as the McCain-Feingold Act, named for the law's two primary sponsors in the United States Senate, John McCain (R) and Russ Feingold (D). As enacted, the law prohibited national political parties, federal candidates and officeholders from soliciting soft money contributions in federal elections. The law also barred corporations and unions from using their treasury funds to finance electioneering communications, which are defined as "broadcast ads referring to clearly identified federal candidates within 60 days of a general election or 30 days of a primary election or caucus." In 2010, the United States Supreme Court ruled in Citizens United v. Federal Election Commission that this latter provision was unconstitutional.

Citizens United v. Federal Election Commission

Justice Anthony Kennedy penned the majority opinion in Citizens United v. Federal Election Commission.

See also: Citizens United v. Federal Election Commission

On January 21, 2010, the United States Supreme Court ruled that the First Amendment right to freedom of expression applies to corporations; thus, the government cannot limit political spending by corporations. Justice Anthony Kennedy penned the majority opinion, which was joined by Chief Justice John Roberts and Justices Clarence Thomas, Samuel Alito, and Antonin Scalia.

“	Although the First Amendment provides that “Congress shall make no law ... abridging the freedom of speech,” §441b’s prohibition on corporate independent expenditures is an outright ban on speech, backed by criminal sanctions. It is a ban notwithstanding the fact that a PAC created by a corporation can still speak, for a PAC is a separate association from the corporation. Because speech is an essential mechanism of democracy—it is the means to hold officials accountable to the people—political speech must prevail against laws that would suppress it by design or inadvertence.	”
—Justice Anthony Kennedy

The court upheld requirements for disclaimer and disclosure by the sponsors of political advertisements. The court also sustained the prohibition against direct contributions by corporations to candidates.

Justice John Paul Stevens penned the dissent, which was joined by Justices Sonia Sotomayor, Ruth Bader Ginsburg, and Stephen Breyer.

“	The basic premise underlying the Court’s ruling is its iteration, and constant reiteration, of the proposition that the First Amendment bars regulatory distinctions based on a speaker’s identity, including its 'identity' as a corporation. While that glittering generality has rhetorical appeal, it is not a correct statement of the law. Nor does it tell us when a corporation may engage in electioneering that some of its shareholders oppose. It does not even resolve the specific question whether Citizens United may be required to finance some of its messages with the money in its PAC. The conceit that corporations must be treated identically to natural persons in the political sphere is not only inaccurate but also inadequate to justify the Court’s disposition of this case.	”
—Justice John Paul Stevens

Noteworthy events

2019

Pursuing America's Greatness v. FEC

Judge Tanya S. Chutkan issued an order overturning an FEC regulation which limited how political committees could use the names of candidates in their campaign materials. Her March 21, 2019, decision held that the regulation violated the First Amendment because it was a restriction on speech that was not narrowly tailored to promote a compelling government interest.

The regulation in question, known as the PAC Name Prohibition, was issued in 1992. It prevented political action committees (PACs) not affiliated with a particular candidate's campaign from using that candidate's name in any name under which the committee conducted political activities, such as in the name of a website or fundraising drive, unless the committee was unambiguously opposed to the candidate in question. A separate rule which was not impacted by the ruling prohibits PACs themselves from being named after candidates.

The plaintiff, Pursuing America's Greatness, was a PAC which supported Mike Huckabee's (R) 2016 presidential campaign. It issued the legal challenge after being ordered by the FEC to take down a website and Facebook page titled, "I Like Mike Huckabee".

In granting the group's motion for summary judgment, Judge Chutkan ruled that the regulation was a content-based restriction of speech and therefore would need to stand up to strict legal scrutiny. This meant that the government would need to demonstrate a compelling need for the regulation and provide evidence that a less stringent regulation would not suffice. She found that the government's desire to prohibit PACs from misrepresenting themselves as supporting a candidate they do not was a compelling need. However, she also found that the FEC had not demonstrated that a more narrow regulation would not suffice.

2018

On July 16, 2018, the U.S. Department of the Treasury and the Internal Revenue Service announced that tax-exempt nonprofit groups described under section 501(c) of the nation's tax code would no longer be required to disclose the names and addresses of their donors on tax documents. The policy change did not apply to reporting requirements for 501(c)(3) groups, which remained unchanged. Groups covered by the policy change included 501(c)(4) organizations, such as Americans for Prosperity, Organizing for Action, the National Rifle Association, and Planned Parenthood. The policy change took immediate effect.

In a press release, U.S. Treasury Secretary Steve Mnuchin said, "Americans shouldn't be required to send the IRS information that it doesn't need to effectively enforce our tax laws, and the IRS simply does not need tax returns with donor names and addresses to do its job in this area. It is important to emphasize that this change will in no way limit transparency. The same information about tax-exempt organizations that was previously available to the public will continue to be available, while private taxpayer information will be better protected." Senate Majority Leader Mitch McConnell (R-Ky.) praised the policy change: "It's particularly welcome news to those of us who are intently focused on defending the First Amendment, for those of who raised concerns during the last administration about activist regulators punishing free speech and free association. The IRS will no longer pointlessly demand private contributor lists from whole categories of tax-exempt organizations."

Democrats criticized the decision, arguing that it could make it easier for foreign entities to influence U.S. elections by making undisclosed donations to politically active nonprofit groups. Sen. Sheldon Whitehouse (D-R.I.) said, "When you have dark money, you have an avenue for foreign influence that by definition you cannot police. And why, in this world in which every red light is blinking, according to our own [director of national intelligence) about Russian interference, why would we want to expand this avenue, not narrow it?" Sen. Ben Cardin (D-Md.) said, "It jeopardizes our national security. It allows for us not to have transparency in our political system."

Recent news

The link below is to the most recent stories in a Google news search for the terms Outside spending. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

Satellite spending - Google News

See also

• Federal Election Commission
• Independent expenditure
• Express advocacy
• Issue advocacy
• Nonprofit regulation in the states
• State nonprofit regulation information
• Super PAC

---

---