“The Wizard” – Campaign Finance Laws

After Kramer’s bid for Condo President of Del Boco Vista phase III takes a hit when Kramer is caught barefoot at the clubhouse, puppet master and campaign manager Morty Seinfeld suggests buying each member of the condo board a Wizard tip calculator as a form of damage control. Bribery questions aside, are Kramer and Morty guilty of breaking campaign finance laws by making such a large expenditure in favor of the campaign?

Although Florida has specific rules regarding limits on campaign contributions, we will apply the Federal campaign donation limits here for simplicity. We encourage the reader to perform their own analysis with the specific numbers from their own state. A helpful table can be found here.

The simple rule in Federal Campaign Finance Laws is that there are no restrictions on the amount of money a campaign can spend, but there are limits as to how much individuals, corporations, unions, and PACS can donate to an individual campaign. The maximum amount that any single individual person can donate to a single political campaign is $2,700 per election. This is true even for the candidate actually running for office. This means that Kramer is only allowed to spend $2,700 of his own money on his campaign, and Morty can only donate $2,700 of his own money to the Kramer campaign (Morty could independently spend larger sums of money – see Citizens United case for further researcho independent expenditures). The reason for these limitations is to help ensure that a candidate is not installed in some kind of puppet regime where a donor can wield power from behind the scenes in a sauna in the clubhouse.

To rule the people, one must walk among them.

An exception to this rule, however, is that the candidate running for office is allowed to loan his or her campaign funds in excess of that $2,700 limit, so long as it is an actual loan and will be paid back to the candidate from campaign funds. Legally, those funds are not considered a campaign contribution, since they are a loan, and therefore do not exceed the $2,700 campaign limit. Therefore, if either Morty Seinfeld or Kramer spent more than $2,700 on the “Wizard” tip calculators then they would be in violation of campaign finance laws, unless Kramer could demonstrate that his expenditure was merely a loan that was to be paid back to him.

According to Jerry, each Wizard tip calculator costs $200, and there are 20 board members of the condo board. This means that, in total, somebody paid $4,000 for the calculators – over $1,000 in excess of the limit! However, it appears that it was neither Morty nor Kramer who purchased the calculators but rather it was Jerry who made the payments, as he said “a Willard? Saccamano, Sr. screwed me!” By saying “me,” Jerry is indicating that he was the one who made the purchase. Even though Jerry did not make this $4,000 contribution directly to the Kramer campaign, he spent this money with the intent of helping the campaign, which is enough to consider it a campaign contribution. Therefore, it seems like Jerry is open to criminal liability for violating campaign finance laws and faces a punishment of up to one year! Additionally, since both Kramer and Morty not only knew about the plan but openly advocated for Jerry to pursue it, this means that both Morty and Kramer are also open to criminal liability!

...sit in the heat, pretend it's not hot, and enforce these rules.

Not so fast though. Ultimately, any attempt to pursue criminal charges against Jerry, Morty, and Kramer might turn out to be a Witch Hunt from that Pinko Commie Rag, The Boca Breeze, as Jerry actually took a deal and purchased “Willards” from Bob Saccamano’s father. While we don’t know the actual price of the “Willard,” it is safe to say that they are approximately $50 a pop. This would mean that Jerry only spent $1,000 on Kramer’s campaign, safely keeping him within the campaign finance limits. Thank God Jerry took that deal!

While tipping $5 on a BLT might not be criminal, making campaign contributions in excess of the FEC limits could be treated criminally by the government. Directly contributing to a campaign account is one way to reach the limit, but expenditures made in conjunction with the candidate or with the campaign can also account as going toward this campaign contribution limit. When Jerry purchased the “Willard” tip calculators, he was making a campaign contribution even though the money came out of his own pocket and was never intermingled with campaign funds. Additionally, because both Kramer and Morty knew about and encouraged the purchase, they too could have faced criminal liability if the expenditure exceeded the $2,700 limit. And when faced with that kind of liability, anybody would start looking for a deal…

- You didn't have a deal? - No deal. Not hot.


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