William & Mary Bill of Rights Journal
The Death of Non-Resident Contribution Limit Bans and the Birth of the New Small, Swing State
New Hampshire’s 1st Congressional District race in 2018 featured an eye-popping number: 96.7. That figure represents the percentage of candidate Maura Sullivan’s individual contributions derived from out-of-state, non–New Hampshire donors. In August 2018, of the $1.37 million USD of individual contributions that Sullivan had raised, only 3.3%—$46,648 USD—originated from in-state contributors. Sullivan had received individual donations amounting to $497,405 USD from Boston, $216,359 USD from New York City, $101,562 USD from the Washington, D.C. metropolitan area, and $92,371 USD from San Francisco.
In nearby Maine, campaign finance reports filed on October 15, 2019, with the Federal Election Commission (FEC) indicate that the Pine Tree State’s 2020 Senate race will be a national battleground. According to the independent regulatory agency, out-of-state donors to the campaigns of Republican Senator Susan Collins and Democrat Sara Gideon constitute the majority of contributions of $200 USD or more between July 2019 and September 2019. So far, Maine residents have made up only 7% and 18.5% of all $200-plus individual contributions to Collins and Gideon, respectively. The largest percentage of individual donations exceeding the $200 USD reporting threshold to both campaigns stem from California and New York. While both candidates are seeking big-dollar donors nationally, smaller-donor, online donations are becoming increasingly common and crucial in close, pivotal races like this.
Approximately one thousand miles westward, in Wisconsin, incumbent Governor Scott Walker had raised $11.5 million USD from out-of-state donors through early October 2018. He was one of three 2018 gubernatorial candidates—in Wisconsin, Pennsylvania, and New York—who raised at least $5.5 million USD from across state lines. While non-resident campaign contributions constituted up to 10% of direct gubernatorial fundraising across the United States as a whole, these three aforementioned gubernatorial candidates raised between 18% and 50% of their campaign funds from out-of-state contributions. These figures cannot be ignored because state legislatures and governors not only establish laws and policies impacting their local constituencies, but also draw up the very congressional maps that have massive repercussions for national politics.
While both Sullivan and Walker ultimately lost their races, their campaigns demonstrate that political engagement across state lines has become a noteworthy development in pivotal federal elections like Maine’s 2020 U.S. Senate race, state-level races, and campaign finance law as a whole. Today, despite various efforts by states to legislate restrictions on out-of-state campaign contributions, only Hawaii maintains such laws. This Article, therefore, seeks to analyze the latest developments in campaign finance laws pertaining to state residency-based limits, especially in swing states. It posits that while smaller, swing states may disproportionately impact the national political landscape, the prospect of increased out-of-state fundraising could allow citizens of larger, inelastic states to heavily impact those races and guide the disproportionate influence of citizens in those smaller states.
Part I of this Article will provide a brief history of individual contribution limits in federal campaign finance law, starting with the Federal Election Campaign Act of 1971. It will analyze the impact of Supreme Court cases like Buckley v. Valeo, Citizens United v. FEC, and McCutcheon v. FEC on this nation’s campaign finance jurisprudence, particularly with respect to individual contributions. Part II will lay out a case study of the four states that have dared to pass laws limiting individual out-of-state contributions—Alaska, Hawaii, Oregon, and Vermont. It will analyze the arguments and holdings of influential Second and Ninth Circuit cases, including VanNatta v. Keisling, Landell v. Sorrell, and most recently, Thompson v. Hebdon. Part III will explore a chief argument raised in favor of limiting out-of-state campaign contributions—the protection of republicanism. It proceeds to explore the confusion of defining an elected official’s “constituent”—a challenge that complicates any recognition of an interest to preserve separate, state-specific political communities in the campaign finance law context. This Part also explores the surrogate representation that a non-resident donor may seek and how this impacts politics outside the constituent’s home state. Finally, Part IV will adopt statistician Nate Silver’s notion of “elasticity” to demonstrate a basic example of how a concerted effort by out-ofstate individual donors could one day be strategically directed to states that have transformed into platforms for national political struggles.
This Article does not pretend to ignore the unprecedented flow of money from political action committees (PACs) and super PACs, which may trump individual out-of-state contributions. Nevertheless, it is still a worthwhile exercise to examine the rising influence of these individual contributions, especially if reforms curbing or eliminating the influence of PACs and super PACs are enacted in the future.