PAC Donations Rise as Elections Loom

With less than a month remaining before Election Day and partisan control of both houses up for grabs, credit union trade groups are shifting their political spending into high gear.

CUNA’s political action committee, known as CULAC, is on pace to spend a record $7 million on the mid-term elections, according to Trey Hawkins, CUNA’s deputy chief advocacy officer for political action.

In 2016, CUNA and its political action committee spent almost $2.4 million on the election, according to the Center for Responsive Politics. During the last mid-term election in 2014, CUNA spent almost $2.5 million.

NAFCU operates a much smaller political action committee. By the end of August, NAFCU had spent $166,000 on candidates. In 2016, it spent $223,500.

The volatility apparent in the electorate has not changed NAFCU’s strategy, according to Carrie Hunt, the trade group’s EVP of government affairs and general counsel.

“We stay focused supporting both Republicans and Democrats,” she said, adding, “It really hasn’t changed our strategy.”

And the goal is always the same, she added. “We have a strong strategy about how we’re going to move our credit union agenda forward.”

For both trade groups, the goal is to support their “friends,” House and Senate candidates who have shown support for credit unions.

For instance, CUNA and NAFCU are providing financial support to moderate Democratic senators who were cosponsors of the bipartisan regulatory overhaul bill crafted by Senate Banking Chairman Mike Crapo (R-Id.).

Some of those Democrats took heat from party members who said that the overhaul de-regulated the financial services industry far too much. And some of those Democrats are locked in tight reelection efforts.

For instance, Sen. Claire McCaskill (D-Mo.) is being challenged by Missouri’s Republican attorney general, Josh Hawley.

President Trump carried Missouri by a wide margin in 2016 and the race is considered to be a toss-up, with polls in recent months showing that neither candidate has a lead of more than three percentage points.

CUNA has announced its support for McCaskill and has contributed $10,000 to her campaign war chest.

Then there’s Sen. Jon Tester (D-Mt.), another bill co-sponsor, who’s facing stiff competition from State Auditor Matt Rosendale. Rosendale describes himself as a “Trump conservative,” in a state that Trump carried in 2016.

Trump has campaigned for Rosendale and signaled Tester out for criticism.

However, Tester supported the Crapo bill, which Trump signed, and so credit unions are supporting his reelection effort. NAFCU’s political action committee has contributed $6,500 to Tester’s reelection effort so far.

“Some of the Senate races are very important,” Hunt said.

Hawkins and Hunt said they have close ties to both sides of the aisles in both houses of Congress.

But in a deeply divided election, someone is inevitably going to be unhappy with a PAC’s decision to support one candidate over another, Hawkins said.

“People are going to want us to take sides,” he said. “Somebody is going to be upset with whomever you pick.”

Hawkins said CUNA relies on its payroll deduction program, in which credit union employees can contribute a small amount from each paycheck to the committee. For some credit union employees, that means contributing 50 cents a week, he said, adding that CUNA’s political action committee has more than 35,000 donors.

Hawkins noted with the electoral margins appearing to be close in both Houses, political action committees like CUNA’s can have a real impact. He said CUNA is in the position of trying to assist longtime Republican credit union defenders in the House and Senate Democratic credit union friends.

For instance, CUNA has announced its support for Rep. Bruce Poliquin (R-Maine) and contributed $10,000 to his campaign. A member of the House Financial Services Committee, Poliquin is being challenged by Jared Golden, a member of the Maine House of Representatives. While Golden is a Democrat, he served on the staff of Sen. Susan Collins (R-Maine) and is a former Marine.

Poliquin is a supporter of Financial Services Chairman Jeb Hensarling’s (R-Texas) huge overhaul of the Dodd-Frank Act, known as the Financial CHOICE Act.

He was an outspoken opponent of former CFPB Director Richard Cordray, with Cordray, at one point, accusing him of character assassination.

And then there’s Rep. Peter Roskam (R-Ill.).

Roskam is chairman of the House Ways and Means Committee’s tax policy subcommittee. That subcommittee is a key panel in any fight over the credit union tax exemption.

Roskam has been an avid supporter of Trump’s proposals even though Hillary Clinton handily carried the district, located in the western suburbs of Chicago.

The New York Times also polled in Roskam’s district and reported that based on 512 responses, the Republican had a 45% to 44% lead over Sean Casten, a clean-energy entrepreneur. Some 11% of the respondents said they were undecided. The poll was conducted Sept. 4 to Sept. 6 and had a margin of error of 4.7 percentage points.

As of August, CUNA had contributed $9,500 to Roskam’s campaign. NAFCU has also shown its support for the Ways and Means Committee Republican, contributing $1,000 so far.

Both trade groups are also supporting Rep. Randy Hultgren (R-Ill.).

Hultgren is a staunch Trump supporter and has been described as a leader of the Tea Party Movement.

As a member of the Financial Services Committee, Hultgren has been an outspoken opponent of Dodd-Frank and supported Hensarling’s Financial Choice Act. He is a supporter of simplified reporting requirements for community financial institutions.

Hultgren’s opponent is Lauren Underwood, a registered nurse who served as a senior advisor in the Department of Health and Human Services during the Obama Administration.

At 32, she is the youngest African American woman running for Congress this year.

So far, CUNA has given $8,500 to Hultgren’s campaign and NAFCU has given the Republican $1,000.

The credit union trade groups are hedging their bets when it comes to partisan control of the House.

If Democrats gain control, Rep. Maxine Waters (D-Calif.) is likely to take over the gavel as chairman of the House Financial Services Committee. Waters has been an outspoken proponent of tighter regulation – something the credit union trades vehemently oppose.

Nonetheless, CUNA has contributed $10,000 to Waters’ campaign war chest, while NAFCU has given $7,500 to her campaign.

Of course, credit unions are not alone among financial institution trade groups contributing to campaigns. By the end of August, the American Bankers Association’s political action committee had donated almost $2 million to House and Senate candidates, while the Independent Community Bankers of America had donated almost $830,000.

But political giving by credit unions tends to be more bipartisan than banking groups. So far this year, the ABA committee had spent 75% on Republicans and 25% on Democrats, according to the Center for Responsive Politics. By comparison, CUNA had spent 53% on Republicans and 46% on Democrats.

Hawkins said CUNA is trying to deliver a clear message: “Credit union friends are going to be there for you when your back is up against the wall.”