What Reports Are Required

The C-4 report filed on January 10, 2018, is the final report if the campaign is concluded, there are no outstanding debts, loans or other obligations, surplus funds have been disposed of and the campaign has been dissolved.

If the campaign does not or cannot file a final report the first January after the general election, continue to file C-4 reports until all debts and other obligations are satisfied.  These reports are filed on the 10th of each month (covering the previous calendar month, or the period since the last report) whenever expenditures made total $200 or more since the last C-4 report was filed.  If you have a campaign surplus, but make no new expenditures, no C-4 reports are required until campaign financial activity resumes.

If the candidate has debts or loans outstanding after the election (but insufficient campaign funds after the election to cover these obligations), there are three options.

  1. Through December 31 of the election year, contributors who have not given the maximum amount allowed may make contributions, so long as any post-election contributions when combined with those given earlier in the campaign do not exceed their limit.  For most contributors that limit is $2,000 to state executive candidates and $1,000 to legislative candidates for the general election.  For the state committee of a bona fide political party and a caucus political committee, the limit is $1.00 times the number of registered voters in the jurisdiction.  Party county central committees and the legislative district committee in the candidate's jurisdiction share a combined limit of $.50 times the number of registered voters.  (These contributions are also reported on a C-3.)
  1. The candidate may contribute personal funds to his or her campaign and use these funds to pay off the debts and loans.  (These contributions are also reported on a C-3 report.)
  1. The candidate decides to seek another public office and files a C-1 registration statement with PDC to that effect.  A final C-4 report for the campaign just concluded is filed.  A beginning C-4 report for the new campaign is also filed, showing the debt being carried forward to this new campaign.  It is conceivable that there could be a cash surplus that is also carried forward; but, it is more likely that all cash remaining from the earlier campaign has been used to reduce the amount of the debt left from that campaign.  (In order to use this debt payment method, the person must be a legitimate candidate in the new election, and not simply re-registering as a candidate in order to collect money to pay off the old debts or loans.  All contributions received count against the contributor's limit (if any) for the new campaign, even if they are spent on debts or loans from the previous campaign.)

Because of the way the law is worded, after December 31 of the election year, no one (except as discussed above) may give a candidate in that election money or anything else of value to pay off remaining campaign debts/loans.  Nor may anyone else directly pay the persons who are owed the money, since those payments constitute in-kind contributions (and contributions have to be made on or before December 31).  Nor may the person to whom the debt or loan is owed forgive the obligation, unless the person did so on or before December 31 (and the amount forgiven, when combined with other contributions from that contributor, does not exceed $1,000 for state legislative candidates and $2,000 for state executive office candidates).

Spending Surplus Campaign Funds

If there is a surplus after the election, you may:

  1. move the money into a Surplus Funds Account and file a final C-4 report for the campaign;
  2. dispose of the surplus in one or more of the other ways allowed by law and file a final C-4 report for the campaign;
  3. let the funds lie dormant in the campaign account (or invest them as discussed below), but before receiving any contributions for a new campaign or making any expenditures for a new campaign, file a final report for the old campaign, file a new C-1 registration for the new campaign, and file a C-4 for the new campaign showing the surplus being carried forward.

Surplus Funds Account

Definition

The balance of contributions given for a specific election that remain after the election and are not needed to pay off that election's campaign debts.  Funds remaining after an election are no longer surplus once they are mingled with new contributions for a future election or used to make expenditures for a future election campaign.
 

Who Needs to Set Up a Surplus Funds Account?

Any elected official who wants to spend surplus campaign funds for non-reimbursed public office related expenses must set up a Surplus Funds Account in order to make these types of expenditures.  The other six legally permissible options for disposing of surplus campaign funds found in RCW 42.17A.430 and listed below in "Using the Account" may be engaged in either with a Surplus Funds Account or directly out of the old campaign account.  However, the dangers of not setting up a separate Surplus Funds Account and simply disposing of surplus funds out of the now inactive campaign account are:

  1. the funds can't be used for non-reimbursed public office related expenses; and
  2. once new campaign monies are co-mingled with any existing surplus balance, or the surplus is carried forward to a new campaign, or expenditures triggering candidacy for a new campaign are made out of the account, none of the funds in the account is considered surplus funds and the money may only be used for expenditures that are directly related to the new campaign.

Opening the Account

Take all or a portion of truly surplus funds and open a separate Surplus Funds Account (or transfer latest surplus into an already existing Surplus Funds Account). The campaign reports an expenditure to show that a transfer has occurred.

Authorized Uses of Surplus

According to RCW 42.17A.430, you may only use monies in a Surplus Funds Account for one or more of the following purposes.

  • Non-reimbursed public office related expenses.*
  • Refunds to contributors.  Refunds of contributions made by the candidate to his or her own campaign are subject to restriction. 
  • Payments to the candidate for verifiable earnings lost because of campaigning.
  • Unlimited contributions to a bona fide political party or caucus political committee.
  • Donations to a charity registered with the Secretary of State in accordance with RCW 19.09.
  • Deposits into the state's general fund, the oral history, state library, and archives account under RCW 43.07.380, or the legislative international trade account under RCW 43.15.050, as specified by the candidate or political committee.
  • Transfers to your campaign account for use in a future election (if a different office is sought than the one for which the surplus funds were initially raised, written permission will have to be obtained from the contributors of the remaining surplus before the surplus may be used to seek the different office).

*A "non-reimbursed public office-related expense" is an expenditure incurred by an elected or appointed official, or a member of his or her immediate family, solely because of being an official. WAC 390-24-032. If the official incurs a non-reimbursed public office-related expense that also, in any manner, could be considered personal in nature, PDC staff recommends paying the expenditure with personal funds, and then seeking reimbursement from a surplus funds account only for that specific portion that is directly related to his or her elected office.

Disclosure

When the account is established by opening a separate bank account:

  • file a C-1 giving the Candidate's Name plus the words "Surplus Funds Account;"
  • transfer all or a portion of the eligible surplus funds into the new or existing Surplus Funds Account (which should be a checking account -- rather than a savings account -- if there will be more than infrequent expenditures out of it); and
  • file C-4 reports along with Schedule A's showing any transfers into the account at the top of the Schedule A and also itemizing all expenditures out of the account on the form.  File a C-4 for the Surplus Funds Account monthly by the 10th of the month, covering the preceding calendar month, for any month in which you transferred in or spent over $200.  If over $200 in activity does not occur in a month, the next report is triggered when over $200 has been transferred into the account or spent out of it since the last report was filed.  Then, file the C-4 by the 10th of the following month.