Campaign Costs For Political Hopefuls: Governor's Race

Running for governor will likely cost a lot of money. The amount of money spent on a campaign varies depending on the office sought, the location, and the individual's campaign strategy. For example, a countywide campaign may cost $20,000 or more, whereas a small-town council campaign may cost around $2,500. In the US, political campaigns collected around $8.6 billion for the 2024 House, Senate, and presidential elections, with over 65% of that money coming from political action committees (PACs). These committees can represent industry groups, labour unions, or individual companies, and they spend millions of dollars on elections without revealing the source of their money. In the US, the Federal Election Commission enforces restrictions on money spent on political campaigns.

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Political action committees (PACs)

At the federal level in the US, an organisation becomes a PAC when it receives or spends more than $1,000 for the purpose of influencing a federal election, and registers with the Federal Election Commission (FEC). Federal law formally allows for two types of PACs: connected and non-connected. Connected PACs, sometimes also called corporate PACs, are established by businesses, non-profits, labour unions, trade groups, or health organisations. Non-connected PACs are formed by groups with an ideological mission, single-issue groups, and members of Congress and other political leaders.

PACs can give $5,000 to a candidate committee per election (primary, general or special). They can also give up to $15,000 annually to any national party committee and $5,000 annually to any other PAC. PACs may receive up to $5,000 from any one individual, PAC or party committee per calendar year.

Super PACs, officially known as "independent expenditure-only political action committees", are unlike traditional PACs in that they may raise unlimited amounts from individuals, corporations, unions, and other groups to spend on, for example, ads overtly advocating for or against political candidates. However, they are not allowed to coordinate with or contribute directly to candidate campaigns or political parties. Hybrid PACs, sometimes called Carey Committees, are similar to super PACs but can give limited amounts of money directly to campaigns and committees, while still making independent expenditures in unlimited amounts.

State-level campaigns

The cost of campaigns varies depending on the state and the specific race. For instance, the race for governor of Illinois in 2023 was the second most expensive on record, costing $210 million. The second costliest governor's race in 2023 was in Florida, where Republicans raised twice as much as Democrats. In Colorado, on the other hand, Democrats had a 2-to-1 fundraising advantage over Republicans.

The sources of campaign funding also vary by state and party. Most states limit the amount an individual contributor can give to each candidate, but political groups, companies, charities, and individuals can spend unlimited amounts as long as they do not coordinate with the candidates' official campaigns. In some states, these entities are not required to disclose their spending or the identities of their donors. National party-affiliated organizations are among those that do report spending, and they often work with state-level campaigns. For example, the Republican Governors Association raised $156 million from the start of 2017 through September 2023, while the Democratic Governors Association brought in $108 million through October 17, 2023.

Political action committees (PACs) also play a significant role in campaign funding at the state level. PACs are groups that pool donations from individuals, corporations, or other organizations to support or oppose political candidates. In the 2023-2024 election cycle, PACs raised $3.7 billion and spent $3.1 billion, according to campaign finance reports filed with the Federal Election Commission.

Federal funding

In the context of gubernatorial campaigns, federal funding can come from various sources, including private individuals, political action committees (PACs), and public funding programs. Private individuals can make contributions directly to a candidate, which is known as "hard money." However, FECA imposes restrictions on the amount they can donate to a candidate, and these contributions must be reported to the FEC.

Political action committees (PACs) are another crucial source of federal funding. PACs are groups that pool funds from multiple donors to support candidates or promote specific political agendas. There are different types of PACs, including connected PACs, nonconnected PACs, leadership PACs, and super PACs, each with its own set of regulations. For example, connected PACs are sponsored by corporations or labor unions and can only receive funds from a restricted class, such as managers and shareholders. On the other hand, super PACs can accept unlimited contributions from various entities, provided they operate within the legal framework.

Public funding programs also play a role in gubernatorial campaign financing. The presidential public funding program, for instance, provides federal government funds to eligible presidential candidates to cover qualified expenses for both primary and general elections. This program utilizes tax dollars to match the first $250 of individual contributions during the primary campaign and to fund the major party nominees' general election campaigns.

Additionally, federal funding regulations aim to maintain transparency and fairness in the campaign process. Candidates are required to disclose detailed financial records of campaign contributions and expenditures, ensuring compliance with contribution limits and reporting requirements. These regulations are enforced by the FEC, which conducts audits of campaigns receiving public funds to ensure adherence to the law.

While federal funding provides a significant financial boost to gubernatorial campaigns, it is just one aspect of the broader campaign financing landscape, which also includes state-specific regulations and private fundraising efforts.

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Private funding

Political party committees provide financial support to candidates within their party. They raise funds from various sources, including members, supporters, and other organisations. PACs are also a common source of private funding for political campaigns. These committees are formed by corporations, labour organisations, and membership groups, which are prohibited from directly contributing to federal campaigns. Instead, they use PACs to solicit donations and make campaign contributions or fund campaign activities such as advertising. Super PACs, or independent expenditure-only political committees, are another form of PAC that raises money to influence federal elections through advertising.

Self-funded candidates, or those who spend a significant amount of their own personal funds on their campaigns, also contribute to the private funding landscape. There is no limit to the amount of personal funds a candidate can spend on their campaign, but they must report the amount to the Federal Election Commission (FEC). This lack of restriction allows wealthy individuals to have a significant impact on political campaigns.

In addition to individual donations and self-funding, private funding for gubernatorial races can also come from organisations and interest groups. For example, labour unions and realtor associations have been known to contribute substantial amounts to gubernatorial campaigns, often favouring specific parties or candidates. These contributions can significantly impact the outcome of elections, as they provide additional resources for advertising, outreach, and other campaign activities.

Campaign finance laws

At the federal level, the FEC enforces the Federal Election Campaign Act of 1971 (FECA), which limits the amount of money individuals and political organizations can contribute to candidates running for federal office, such as the President and Congress. The FEC also oversees public funding used in presidential elections, with eligible candidates receiving funds to cover qualified expenses during the primaries and general elections.

In addition to federal laws, individual states have their own campaign finance regulations. For example, Arizona, Maine, Connecticut, Portland (Oregon), and Albuquerque (New Mexico) have implemented "Clean Elections" laws, which allow officials to be elected without spending private contributions.

The cost of running for governor varies widely depending on the state and the competitiveness of the race. For example, Illinois had the second most expensive race for governor on record, with $210 million spent, while Florida had the second costliest governor's race in 2023. Overall, state-level campaigns for governor, legislative seats, and other offices attracted more than $2 billion in campaign contributions in 2023.

To influence elections and public policy, individuals, political action committees (PACs), and special interest groups contribute significant amounts of money. PACs are organizations that raise and spend funds to influence elections and can be connected or nonconnected to corporations, unions, or other interest groups. A 2022 study found that billionaires increasingly use their personal wealth and that of corporations they control to influence politics.

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