Personal Use of Campaign Funds–Some Clarifications

by Dick Hall-Sizemore

James Sherlock has posted an article accusing the General Assembly of being “the only state that allows candidates to raise unlimited funds and spend that money on personal expenses.” He bases that accusation on the defeat of two bills:  HB 1952 in 2021 and SB 1471 in 2023.

The accusation is misleading and the issue is more complex than he acknowledges.

Currently, Sec. 24.2-948.4 of the Code of Virginia has this language: “It shall be unlawful for any person to convert any contributed moneys, securities, or like intangible personal property to his personal use or to the use of a member of the candidate’s ‘immediate family’ as that term is defined in § 30-101.” If that language seems familiar, it is because it is the same language quoted by Jim as being in the 2021 and 2023 bills.

This language has been the source of debate and consternation for legislators for several years. The problem revolves around the meaning of “personal use.” If a candidate uses campaign funds to buy a couple of new suits for campaigning, does that constitute “personal use”? Can a candidate use campaign donations to pay his dry-cleaning bill while campaigning? Can a single parent with school-age children use campaign funds to provide child care while he/she is on the campaign trail? If these examples constitute “personal use” for which campaign funds cannot be used, then people with lower incomes or single parents would be discouraged from running. Another example that came up: If a candidate holds an event and there is food left over, can the candidate take that food home for consumption by him and his family?

Because of the ambiguity of the language, vague reporting requirements, and the absence of any enforcement or auditing mechanisms, there have been instances in which candidates could have been said to have used campaign funds for mostly personal uses.

The purpose of the 2021 and 2023 bills was not primarily to prohibit the use of campaign funds for personal use; that was already in the law. The purpose was to attempt to clarify what constitutes “personal use” and to establish enforcement mechanisms. An examination of those bills would be helpful in understanding this issue.

2021—HB 1952

As passed by the House and reported out of the Senate Privileges and Elections Committee, the bill would have moved the language in Sec. 24.2-948.4, quoted above, to a new, stand-alone section along with the following paragraph:

For purposes of this section, a contribution shall be considered to be converted to personal use if the contribution, in whole or in part, is used to fulfill any commitment, obligation, or expense that would exist irrespective of the person’s seeking, holding, or maintaining public office. “Personal use” does not include the ordinary and accepted expenses related to campaigning for or holding elective office, including the use of campaign funds to pay for the candidate’s child care expenses that are incurred as a direct result of campaign activity.

The bill also would have required the Attorney General to issue an opinion “explaining” the provisions prohibiting the use of campaign funds for personal uses.

Some Senators must have been uncomfortable with the Attorney General defining what constituted personal use. There was a floor substitute introduced that set out what did not constitute a violation of the provision and eliminating the provision requiring the Attorney General to do the defining. Included in the list of allowed expenses were child care expenses. As I remember the debate, that was the provision that drew the most opposition. They passed the bill by for two days while they debated it among themselves and, having failed to reach a consensus, sent the bill back to committee where it remained until the legislature adjourned.

2023—SB 1471

As passed by the Senate, the bill would have eliminated the previously-quoted language in Sec. 24.2-948.4 and created a new section, setting out expenses for which campaign funds could be used and specific uses that were prohibited.  Among explicitly permitted expenses was dependent care. The expressly prohibited expenses were:

  • A home mortgage, rent, or utility payment;
  • A non-campaign-related automobile expense;
  • A country club membership;
  • A vacation or other non-campaign-related trip;
  • A tuition payment;
  • Admission to a sporting event, concert, theater, or other form of entertainment not associated with an election campaign; or
  • Dues, fees, and other payments to a health club or recreational facility.

The bill also included a lot of language dealing with the reporting and investigation of violations.

The bill passed the Senate unanimously. It died with no debate in a House subcommittee.