The (Dunkin') Donut Hole: Fixing the LLC Loophole in State Campaign Finance Laws—A New Hampshire Exemplar

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Seattle University Law Review, Vol: 41, Issue: 4, Page: 1227

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O'Neill, Brendan
new; hampshire; dunkin'; donut; campaign; finance; reform; loophole; LLC; fund; funding; Civil Law; Election Law; Law and Society; Other Law; State and Local Government Law
article description
The campaign finance laws of New Hampshire (and other states) permit direct contributions to gubernatorial candidates from individuals or corporations of up to $7,000 per campaign cycle. However, no state campaign finance statutes discuss, define, or even mention LLCs. Each LLC is its own individual donor for the purpose of direct campaign contributions, regardless of who controls it. Thus, a wealthy individual can max out the $7,000 direct contribution to his or her preferred candidate through every LLC under his or her control, limited only by imagination and the ability to set up as many LLCs as legally feasible. A rich and resourceful person could disperse funds directly into the campaign coffers of a preferred candidate without limit—some have. Part I of this Note reviews the mechanics of the LLC loophole and its prevalence around the country and then examines the legal and political circumstances of loopholes in New York and Washington, D.C. Part II of this Note focuses in on New Hampshire’s unique circumstances for closing its LLC loophole, and then further reviews the current relevant statutes and legislative effort for correcting the LLC loophole, and culminates in a legislative proposal for closing New Hampshire’s loophole. Part III broadens the lens to discuss the legal and political circumstances implicated in any attempt to close the LLC loophole—in New Hampshire and other states around the country.