Corporate PAC FAQs

What is a Corporate PAC?

A “corporate PAC” is not a rhetorical or subjective term, it is a category set by the Federal Election Commission (FEC). PACs that are connected to a corporation and engage in federal elections must file a Statement of Organization with the FEC. If they are operated by a corporation they must disclose that information with the FEC, thus designating them as a corporate PAC. These PACs are controlled by corporations and underwritten with direct corporate money, meaning corporations are able to pay for overhead costs and staff time to run their PAC.

During the 2018 election cycle, corporate PACs spent over $419 million to influence elections, which includes $185 million contributed directly to candidates running for federal office. That’s 40% of all PAC giving, making them the largest source of PAC giving in the country.

Who Funds Corporate PACs?

In addition to the money corporations spend directly on overhead, operations, and fundraising, corporate PACs raise money from a narrow subset of employees and stockholders referred to as “restricted class.” These are people who have decision-making power for the corporation, like executives and managers. “Restricted class” does not include employees represented by a union or hourly employees. Corporations are able to encourage employees to contribute to their PACs with incentives paid for by the corporation, like raffles with prizes. Corporate PACs are only able to ask non-restricted class employees to contribute to their PACs twice a year in writing.

What are the differences between Corporate PACs and Ideological PACs?

In most cases, corporate PACs expressly make contributions to candidates to advance the corporation’s interests and its stockholders. Corporate PACs are often controlled by corporate lobbyists and government affairs staff who approve PAC contributions.

Ideological PACs exist and make contributions to candidates that align with issues for which those groups advocate for.

Does taking money from Leadership PACs equate to taking Corporate PAC money?

Leadership PACs are run by members of Congress and candidates for office. They typically give donations to other candidates to help elect more members of their political party to build a governing majority.

Accepting support from another candidate in your political party does not equate to taking corporate PAC money.

Candidates who refuse to take corporate PAC money deny corporations the ability to hold a corporate PAC check over their head to sway their vote once in office. Whether or not a corporate PAC donated to a leadership PAC is irrelevant to that process.