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Small donor committees
Voluntary spending limits



Small Donor Committees

Q1. What is a Small Donor Committee?

A1.  A Small Donor Committee (SDC) is a political committee that accepts contributions from natural persons. [1]  Each natural person must be a U.S. citizen and can contribute no more than fifty dollars per calendar year.

If your committee will accept more than fifty dollars per person in a calendar year, see Political Committee.

 

Q2. How do I register a Small Donor Committee?

A2.  You must register a committee online.  

Before registering, make sure that you have:

  • A committee name and any acronyms that you will use.
  • A registered agent.
  • The registered agent's email address and phone number.
  • Physical and mailing addresses for the committee's principal place of business.
  • A description of your committee's purpose.  This information should be detailed, including candidates, ballot measure numbers, or policy positions that you will support or oppose.
  • Financial information, including the name of the bank where the committee has or will have an account.

To register:

  1. Go to the TRACER campaign finance disclosure website.
  2. Click on the "Committee Registration" button.
  3. Select "Small Donor Committee", then click on "Next >".
  4. Fill out the form.  When you are finished, click on "Submit".
  5. Print a copy of the form for your records.
  6. Click on "Finished" to complete your registration.
  7. Login information will be sent to the registered agent's email address.

If you need help using TRACER, see Learn to Use TRACER.


Q3. Who can form a Small Donor Committee?

A3.  Corporations and labor organizations can establish Small Donor Committees.   However, corporations and labor organizations cannot contribute to SDCs, and money contributed to a SDC cannot be given back to a corporation or labor organization for general use. 

A group of 2 or more natural persons can form a Small Donor Committee.  If the committee is formed by only two persons, they can not be a married couple. [2]

Small Donor Committees established by substantially the same group of persons will be treated as a single committee.

 

Q4. What is a registered agent?

A4.  A registered agent is the person to whom all correspondence about the committee will be addressed.  He or she is also responsible for maintaining committee records and filing reports on time.  The registered agent must be a natural person.

The registered agent acts as a treasurer, keeping track of all contributions and expenditures.

In addition to the registered agent, the committee may also appoint a designated filing agent to be responsible for the timely filing of Contribution and Expenditure reports.

 

Q5. Do we have to have a registered agent?

A5.  Yes.  All committees registered with our office must have a registered agent.

 

Q6. How do we change our registered agent?

A6.  A committee can file an amended registration to change the registered agent. 

A registered agent can also resign. To resign, a registered agent must file a resignation letter with the appropriate filing officer via certified mail.

There must be a registered agent associated with each committee at all times.

 

Q7. Can members of the organization(s) that formed the Small Donor Committee contribute?

A7.  Members of organizations can contribute, but corporations and labor organizations themselves cannot.

Dues transferred to a small donor committee from a membership organization, whether individually or as a lump sum, are considered pro rata contributions to the committee from individual members. The actual transfer itself is not considered a contribution from the membership organization to the small donor committee.

If the pro rata amount from each individual is $20 or more in a reporting period, each individual member must be listed as a contributor.

 

Q8. Can corporations and labor organizations make direct contributions to small donor committees?

A8.  No, only their employees or members (who are natural persons) may make contributions to small donor committees.

 

Q9. What are the reporting requirements for Small Donor Committees?

A9.  All contributions received and expenditures made by a small donor committee must be reported to our office.  The exception is municipal committees who report to the municipal clerk.

The name and address of the contributor must be reported for all contributions of $20 or more.

 

Q10. How do I amend our registration?

A10.  Amendments, including name and address changes, changes to the committee's purpose and changes to financial institution, can be filed online at the TRACER campaign finance disclosure website.  Amendments must be reported within five days of the change. 

 

Q11. Can LLCs contribute to SDCs?

A11.  No.  Contributions from LLCs are prohibited, because LLCs are not natural persons.

 

Q12. Who can sign and file our reports?

A12.  Only the registered agent may sign and electronically file committee reports.

 

Q13. How do we terminate a Small Donor Committee?

A13.  You must submit a termination report through the TRACER system to close a Small Donor Committee (with the exception of municipal committees).

The committee must have a zero balance, which means there are no funds on hand and no outstanding debts or other obligations. 

As long as the committee remains open, it must file disclosure reports.

The termination report may be filed at any time.

There are no regulations related to unexpended funds held by a small donor committee.  However, keep in mind the definition of a small donor committee when expending these funds. 

 

Q14. How do small donor committees work?

A14.  Small donor committees are a form of political committee. The contribution limit from their supporters is lower than political committees at only $50 per natural person per year, but the committees may make larger contributions to candidates. [3] 

 

Q15. Can a small donor committee transfer a portion of the balance of funds on hand back to the local union for regular union expenditure use?

A15.  No.

 

Q16. Can the transfer of membership dues from a membership organization to a small donor committee be excluded from the $50 limitation set forth in Section 2(14)(a) based upon the exclusive language contained in Section 2(5)(b), which states, that  “Contribution does not include…a transfer by a membership organization of a portion of a member’s dues to a small donor committee sponsored by such membership organization”?

A16.  The transfer itself of membership dues from a membership organization to a small donor committee is excluded from the $50 limitation set forth in Article XXVIII, Sec. 2(14)(a) of the Colorado Constitution based upon the exclusive language contained in Article XXVIII, Sec. 2(5)(b) of the Colorado Constitution. However, that portion of a member’s dues transferred from a small donor committee is considered a pro-rata contribution from the individual members to the small donor committee.

 

Q17. Is a membership organization required to segregate the dues it receives from corporations from the dues it receives from natural persons?

A17.  Not if the dues received from corporations are payment for the membership dues of natural persons. If the dues are received from corporations for their own corporate memberships, then such dues must be segregated and cannot be transferred to a small donor committee.

 

Q18. Can a membership organization transfer dues to a small donor committee that were paid to the organization by a member’s corporation on behalf of one or more individual members?

A18.  Yes. The dues transferred by a membership organization to the small donor committee sponsored by such organization will be treated as pro-rata contributions from the individual members whose portion of membership dues was transferred. It is considered a contribution from the member, not the corporation.

 

Q19. How does a small donor committee list a membership transfer from a membership organization since they are not contributions?

A19.  If a small donor committee (SDC) receives $20 or more in dues and other contributions from any individual during a reporting period (as attributed pro-rata), the small donor committee should list each such individual.

Amounts received from individuals that total less than $20 during a reporting period should be reported as non-itemized contributions. The membership organization must provide a list of the members and the amount of dues transferred for each member.  The small donor committee must keep that list for audit purposes to be sure that individuals do not exceed the $50 per year contribution limit.

 

Q20. Do we have to set up a bank account specifically for the committee?

A20.  All contributions received by a committee must be deposited in a financial institution in a separate account with a title that includes the committee name.

You can choose which bank you will use for your committee account.  Please consult your bank and IRS regulations concerning account requirements, which may vary depending on the institution.

 

Q21. What statutes and rules apply to Small Donor Committees?

A21.  The following provisions apply to small donor committees:

 

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[1] Campaign Finance Rule 1.15
[2] Campaign Finance
Rule 1.18.1
[3] Campaign Finance Rule 10