Apr 17, 2022 - Politics & Policy

Out-of-state money floods midterm races

Data: FEC; Chart: Sara Wise/Axios

Candidates in key midterm primaries are getting huge cash boosts from wealthy out-of-state donors — funneled through groups that can raise and spend unlimited sums for them, according to an Axios analysis.

Why it matters: The massive out-of-state spending shows the degree to which high-profile congressional races have been nationalized. It precedes major Senate primaries, including Ohio's on May 3 and Pennsylvania's on May 17.

How it works: Axios examined Federal Election Commission filings for 26 top-tier, single-candidate super PACs.

  • The independent groups spend in support of, or, in some cases, in opposition to, one specific midterm hopeful.
  • Spending through March 31 was made public after a Friday reporting deadline.

The big picture: Those 26 super PACs together reported raising $84 million so far this cycle. More than three-fourths of that haul came from donors who don't reside in the states where those groups are spending.

  • Half of the 26 received at least 95% of their funding from out of state.
  • These include the top three single-candidate super PACs of the cycle so far: Honor Pennsylvania, Saving Arizona and Protect Ohio Values.

The details: Honor Pennsylvania is backing Republican David McCormick in that state's Senate race. All of its $15.3 million in receipts came from outside of Pennsylvania, the filings showed.

  • Saving Arizona and Protect Ohio Values — groups backing Republican Senate hopefuls Blake Masters and J.D. Vance, respectively— are funded almost entirely by a single out-of-state donor, California tech mogul Peter Thiel.
  • Vance rival Josh Mandel enjoys the backing of the USA Freedom Fund, which got 100% of its nearly $2 million this cycle from out of state.

Pennsylvania, Arizona and Ohio weren't the only states where these patterns are playing out.

  • Alabama Patriots PAC, which supports Republican Senate candidate Mike Durant, is also entirely funded by out-of-state donors.
  • The top House-focused super PAC on the list, Progress Pinellas, is backing Democrat Eric Lynn in Florida's 13th District. All of its $1.5 million came from Chicago private equity executive Justin Ishbia.
  • Other donors are single-handedly funding super PACs in other states. Illinois industrial supply magnate Richard Uihlein is the sole donor to groups supporting Senate candidates Eric Greitens in Missouri and Jake Bequette in Arkansas.
  • Las Vegas casino magnate Steve Wynn is bankrolling Protect and Defend America, a PAC backing Republican Brady Duke's Florida House bid.

What they're saying: Some super PAC officials told Axios a national fundraising profile is the only way their candidates can compete with wealthy, self-funded rivals, who can pour unlimited sums directly into their own campaigns.

  • "Our campaign finance system overwhelmingly benefits people who can self-fund campaigns to the tune of many millions of dollars," Luke Thompson, the executive director of pro-Vance group Protect Ohio Values, told Axios.
  • Vance's primary opponents include Ohio businessman Mike Gibbons, who's given millions to his campaign. "Candidates who aren’t mega-rich have to try to make up the difference with a combination of small-dollar fundraising and support from outside groups,” Thompson said.
  • A spokesperson for Saving Arizona, the pro-Masters group, noted self-funders such as Masters rival Jim Lamon can "access the cheapest television rates available due to FCC rules for candidate ads."
  • "To a degree, independent expenditure groups like ours level the playing field and allow us to help candidates who aren’t extremely wealthy to be competitive with those that are," the spokesperson said.

Between the lines: At this stage in the cycle, candidates aren't competing for congressional majorities; the fight is over the particular candidates who will make it to the general election as their party's nominee.

  • That's what sets single-candidate groups apart from high-dollar spenders such as Republicans' Senate Leadership Fund, or the Democrats' Senate Majority PAC, both deep-pocketed super PACs devoted to winning party control of the upper chamber.
  • For high-dollar donors, single-candidate groups present opportunities to shape the slate of candidates competing in what is expected to be a favorable year for Republicans.

Yes, but: It's not all out-of-staters backing these independent spenders.

Some candidates enjoy the support of in-state funders as well.

  • Two groups backing Alabama Republican Katie Britt's Senate bid, Alabama's Future and the Alabama Conservatives Fund, are almost entirely funded by Alabama donors.
  • Restore Common Sense, a group backing North Carolina Republican Senate candidate Marjorie Eastman, got all of its money from the Tarheel State.
  • It came, specifically, from a single donor: pharmaceutical executive Fred Eshelman.
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