The following opinion is presented on-line for informational use only and does not replace the official version. (Mich Dept of Attorney General Web Site - www.ag.state.mi.us)



STATE OF MICHIGAN

FRANK J. KELLEY, ATTORNEY GENERAL


Opinion No. 5279

March 22, 1978

ELECTIONS:

Corporate contributions

Establishment of separate segregated fund by a corporation

CAMPAIGN FINANCE ACT:

Establishment of separate segregated fund by a corporation

A corporation is prohibited from establishing a political committee for the support of state candidates but may make expenditures for the establishment, administration and solicitation of contributions for a separate segregated fund to be used for political purposes.

Contributions to a separate segregated fund established by a corporation to be used for political purposes may be in the form of a voluntary payroll deduction plan, but contributions to the fund may only be made by the following persons or their spouses: (1) stockholders of the corporation; (2) officers and directors of the corporation; and (3) employees of the corporation who have policy-making, managerial, professional, supervisory or administrative nonclerical responsibilities.

The administration of a separate segregated fund established by a corporation for political purposes and authorization of expenditures from the fund must be in the board of directors of the corporation or by a committee authorized by the board of directors.

Mr. Bernard J. Apol

Director

Elections Division

Department of State

106 South Pine Street

Lansing, Michigan

You have requested my opinion on the following questions:

1. Does Michigan law prohibit a corporation from establishing or maintaining a political committee for the support of state candidates?

2. Does Michigan law prohibit using a voluntary payroll deduction plan to collect political contributions to a separate segregated fund established by a corporation?

3. Does Michigan law prohibit a corporation from establishing or maintaining a political committee for the support of federal candidates?

Section 55 of the campaign finance act, 1976 PA 388; MCLA 169.255; MSA 4.1703(55), provides:

'(1) A corporation or joint stock company formed under the laws of this or another state or foreign country may make an expenditure for the establishment and administration and solicitation of contributions to a separate segregated fund to be used for political purposes. A fund established under this section shall be limited to making contributions to, and expenditures on behalf of, candidate committees, ballot question committees, political party committees, and independent committees.

'(2) Contributions for a fund established by a corporation or joint stock company under this section may be solicited from any of the following persons or their spouses:

'(a) Stockholders of the corporation.

'(b) Officers and directors of the corporation.

'(c) Employees of the corporation who have policy making, managerial, professional, supervisory, or administrative nonclerical responsibilities.

'(3) Contributions for a fund established under this section by a corporation which is nonprofit may be solicited from any of the following persons or their spouses:

'(a) Members of the corporation who are individuals.

'(b) Stockholders of members of the corporation.

'(c) Officers or directors of members of the corporation.

'(d) Employees of the members of the corporation who have policy making, managerial, professional, supervisory, or administrative nonclerical responsibilities.

'(4) Contributions shall not be obtained for a fund established under this section by use of coercion, physical force, or as a condition of employment or membership or by using or threatening to use job discrimination or financial reprisals.

Thus, contributions by a separate segregated fund established by a corporation may only be made to four committees, these being (1) a candidate committee; (2) a ballot question committee; (3) a political party committee; and (4) an independent committee. The act, therefore, prohibits a corporation from establishing a political committee for the support of state candidates. This section does, however, permit a corporation to make expenditures for the establishment, administration and solicitation of contributions for a separate segregated fund to be used for political purposes, but does not authorize the corporation to contribute its funds to the separate segregated fund or to establish a political committee for the support of state candidates. It must be noted that the administration of such a fund and the authorization of expenditures from the fund must be by the board of directors of the corporation or by a committee authorized by the board of directors of the corporation.

As to your second question, the act does permit a voluntary payroll deduction plan as a form of collection of contributions to the separate segregated fund, but limits the contributors to the following persons and their spouses (1) officers and directors of the corporation and (2) employees of the corporation who have policy making, managerial, professional, supervisory or administrative responsibilities.

Finally, in answer to your third question, while Michigan law does not specifically prohibit a corporation from establishing a political committee for the support of federal candidates, a prohibition does exist by virtue of federal law. 90 Stat 490, 2 USC 441b.

Frank J. Kelley

Attorney General