On April 6, 2017, we sent a mailing alerting you to the fact that the Republican Attorneys General Association had registered its main account — the general operating account — as a political committee with the Commonwealth of Virginia. It has recently come to our attention that both the Republican Governors Association (RGA) and the Republican State Leadership Committee (RSLC) have similarly registered their main accounts as political committees in Virginia. As a result, these organizations must publicly disclose to Virginia all contributors that made aggregate contributions of $2,500 or more to their general operating accounts since January 1, 2017.
While it is common for various 527 organizations to establish state political committees and support them with transfers of certain unrestricted funds from their general operating accounts, it is unusual for a 527 organization to register its main operating account as a political committee, thus subjecting that account to applicable election law restrictions and disclosure requirements. Indeed, the RGA, RSLC and other 527 organizations have routinely made written representations to donors that it will not make political contributions or independent expenditures from, or otherwise trigger political committee status for, the main operating account.
Given that Virginia law allows corporations and individuals to contribute an unlimited amount to its state political committees, the fact that the RGA and RSLC have registered as political committees should not affect the legal permissibility of contributions that already have been made to their main operating accounts. However, anyone who has contributed to either or both of these organizations based on an understanding that their main operating accounts would not trigger political committee status — either for policy or other non-legal reasons, such as voluntary agreements the company may have made with shareholders in response to a proxy proposal — may want to follow up with the organization.
This memorandum is provided by Skadden, Arps, Slate, Meagher & Flom LLP and its affiliates for educational and informational purposes only and is not intended and should not be construed as legal advice. This memorandum is considered advertising under applicable state laws.