AO 2021-09: LLC may sell sponsored ads to political committees
Certified Voter, LLC (Certified Voter) may sell sponsored advertisement services to political committees for a commercially reasonable fee without the services resulting in an in-kind contribution.
Background
Certified Voter proposes to offer a commercial service to political committees by selling customized “sponsored” advertisements. A contributor would make a minimum contribution to a political committee and then be offered the option to receive a customized version of a political advertisement already created and paid for by the campaign. Certified Voter would then create a brief message identifying the contributor as a “sponsor” of the ad to be appended to the advertisement.
Analysis
The Federal Election Campaign Act (the Act) and Commission regulations prohibit corporations, (including limited liability companies that have elected to be treated as corporations for federal tax purposes), from making contributions in connection with a federal election. A contribution includes “any direct or indirect payment, distribution, loan, advance, deposit, or gift of money, or any services, or anything of value . . . to any candidate, campaign committee, or political party or organization, in connection with any [federal] election.” “[A]nything of value” includes all in-kind contributions, such as the provision of goods and services without charge or at less than the “usual and normal charge.” Commission regulations define “usual and normal charge” as the price of goods in the market from which they ordinarily would have been purchased at the time of the contribution, or the commercially reasonable rate prevailing at the time the services were rendered.
Certified Voter intends to sell customized, sponsored advertisement services to political committees for a “commercially-reasonable” fee. Because Certified Voter will provide its services to client committees at a “commercially-reasonable” fee, it is not providing goods or services at less than the “usual or normal charge,” and is not making an in-kind contribution to its political committee customers.
Date Issued: September 30, 2021; Length: 4 pages
Citations
Regulations
11 CFR 100.52(d)
Gift, subscription, loan, advance or deposit of money.
11 CFR 110.1(g)(3)
Contributions by limited liability companies
11 CFR 114.2(b)
Prohibition on contributions by corporation
Statutes
52 U.S.C. 30118(a)
Prohibition on contributions by corporations
52 U.S.C. 30101(8)(A)(i)
Definition of contribution